--- page 1 ---
* For Identification Purpose Only
Sole Sponsor, Sole Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers (in alphabetical order)
Joint Lead Managers (in alphabetical order)
Joint Bookrunners and Joint Lead Managers (in alphabetical order)
GLOBAL OFFERING
(A joint stock company incorporated in the People’s Republic of China with limited liability)
Stock Code : 2495
上海聲通信息科技股份有限公司
Shanghai Voicecomm Information Technology Co., Ltd.
上海聲通信息科技股份有限公司
Shanghai Voicecomm Information Technology Co., Ltd.


--- page 2 ---
IMPORTANT: If you are in any doubt about any of the contents of this prospectus, you should obtain independent professional advice.
Shanghai Voicecomm Information Technology Co., Ltd. *
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
: 4,365,660 H Shares (subject to the
Over-allotment Option)
Number of Hong Kong Offer Shares : 436,580 H Shares (subject to adjustment)
Number of International Offer Shares : 3,929,080 H Shares (subject to
adjustment and the Over-allotment
Option)
Offer Price : HK$152.10 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 : RMB1.00 per H Share
Stock code : 2495
Sole Sponsor, Sole Overall Coordinator, Joint Global Coordinator, Joint Bookrunner
and Joint Lead Manager
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
(in alphabetical order)
Joint Bookrunners and Joint Lead Managers (in alphabetical order)
⳪暲@:9)
Joint Lead Managers (in alphabetical order)
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 howsoever arising from or in re liance upon the whole or any part of the contents
of this prospectus.
A copy of this prospectus, having attached thereto the documents specified in “Appendix VII – Documents Delivered to the Registrar of Companies and Av ailable on Display”, has been registered by
the Registrar of Companies in Hong Kong as required by section 342C of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Chapter 32 o f the Laws of Hong Kong). The Securities
and Futures Commission of Hong Kong and the Registrar of Companies in Hong Kong take no responsibility for the contents of this prospectus or any other d ocument referred to above.
The Offer Price will be HK$152.10 per Offer Share, unless otherwise announced. Applicants for Hong Kong Offer Shares are required to pay, on applicati on, the Offer Price of HK$152.10 for each Hong
Kong Offer Share together with a brokerage fee of 1.0%, a SFC transaction levy of 0.0027%, an AFRC transaction levy of 0.00015% and a Hong Kong Stock Exch ange trading fee of 0.00565%.
The Sole Overall Coordinator, on behalf of the Underwriters, may, with the consent of our Company, reduce the number of Hong Kong Offer Shares and/or th e Offer Price below that stated in this
prospectus (being HK$152.10 per Offer Share) at any time on or prior to the morning of the last date for lodging applications under the Hong Kong Public O ffering. In such a case, notices of the reduction
in the number of Hong Kong Offer Shares and/or the Offer Price will be published on the websites of the Stock Exchange at www.hkexnews.hk and our Company at www.voicecomm.cn as soon as
practicable following the decision to make such reduction, but in any event not later than the morning of the day which is the last day for lodging applic ations under the Hong Kong Public Offering.
For further information, see “Structure of the Global Offering” and “How to Apply for Hong Kong Offer Shares” in this prospectus.
We are incorporated and substantially all of our business and assets are located in the PRC. Potential investors should be aware of the differences in t he legal, economic and financial systems between
the PRC and Hong Kong, and the fact that there are different risk factors relating to investment in PRC-incorporated companies. Potential investors s hould also 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 the H Shares. Such differences and risk factors are set out in “Risk
Factors” and “Regulatory Overview” in this prospectus and in Appendix III, Appendix IV and Appendix V to this prospectus.
Pursuant to the termination provisions contained in the Hong Kong Underwriting Agreement in respect of the Hong Kong Offer Shares, the Sole Sponsor an d the Sole Overall Coordinator, on behalf
of the Hong Kong Underwriters, have the right in certain circumstances, in their absolute discretion, to terminate the obligation of the Hong Kong Und erwriters pursuant to the Hong Kong Underwriting
Agreement at any time prior to 8:00 a.m. on the Listing Date. Further details of the terms of the termination provisions are set out in “Underwriting – Un derwriting Arrangements and Expenses – The
Hong Kong Public Offering – Grounds for Termination” in this prospectus.
The Offer Shares have not been and will not be registered under the U.S. Securities Act or any state securities laws in the United States, and may not be of fered, sold, pledged or transferred within the
United States, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and i n accordance with any applicable U.S. state securities
laws. The Offer Shares may be offered and sold only outside of the United States in offshore transactions in reliance on Regulation S under the U.S. Secu rities 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 websites of the Stock Exchange ( www.hkexnews.hk ) and our Company ( www.voicecomm.cn ). If you require a printed copy of this prospectus, you may download
and print from the website addresses above.
* For identification purpose only
IMPORTANT
June 28, 2024


--- page 3 ---
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 to the public in relation
to the Hong Kong Public Offering.
This Prospectus is available at the website of the Hong Kong Stock Exchange at
www.hkexnews.hk under the “ HKEXnews > New Listings > New Listing Information ”
section, and our website at www.voicecomm.cn . If you require a printed copy of this
document, you may download and print from the website addresses above.
To apply for the Hong Kong Offer Shares, you may:
(1) apply online through the White Form eIPO service at www.eipo.com.hk ;
(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.
IMPORTANT
–i–


--- page 4 ---
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 above. Please refer to the section headed “How to Apply for Hong Kong Offer
Shares” in this prospectus for further details of the procedures through which you can
apply for the Hong Kong Offer Shares electronically.
Your application through the White Form eIPO service or the HKSCC EIPO
channel service must be for a minimum of 20 Hong Kong Offer Shares and in one of the
numbers set out in the table.
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. You
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.
Shanghai Voicecomm Information Technology Co., Ltd.
(HK$ 152.10 per Hong Kong Offer Share)
NUMBER OF HONG KONG OFFER SHARES THAT MAY BE APPLIED
FOR AND PAYMENTS
No. of
Hong Kong
Offer Shares
applied for
Amount
payable on
application (2)
No. of
Hong Kong
Offer Shares
applied for
Amount
payable on
application (2)
No. of
Hong Kong
Offer Shares
applied for
Amount
payable on
application (2)
No. of
Hong Kong
Offer Shares
applied for
Amount
payable on
application (2)
HK$ HK$ HK$ HK$
20 3,072.67 400 61,453.57 6,000 921,803.57 80,000 12,290,714.28
40 6,145.35 500 76,816.96 7,000 1,075,437.51 90,000 13,827,053.56
60 9,218.04 600 92,180.36 8,000 1,229,071.43 100,000 15,363,392.86
80 12,290.72 700 107,543.75 9,000 1,382,705.35 120,000 18,436,071.42
100 15,363.39 800 122,907.14 10,000 1,536,339.29 140,000 21,508,749.99
120 18,436.07 900 138,270.54 20,000 3,072,678.56 160,000 24,581,428.55
140 21,508.74 1,000 153,633.93 30,000 4,609,017.85 180,000 27,654,107.14
160 24,581.43 2,000 307,267.86 40,000 6,145,357.15 218,280
(1) 33,535,213.91
180 27,654.11 3,000 460,901.78 50,000 7,681,696.43
200 30,726.79 4,000 614,535.71 60,000 9,218,035.71
300 46,090.18 5,000 768,169.64 70,000 10,754,375.00
(1) Maximum number of Hong Kong Offer Shares 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).
No application for any other number of the Hong Kong Offer Shares will be
considered and any such application is liable to be rejected.
IMPORTANT
–i i–


--- page 5 ---
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 the websites of
the Stock Exchange at www.hkexnews.hk and our Company at www.voicecomm.cn .
Hong Kong Public Offering commences ........................ .9:00 a.m. on Friday,
June 28, 2024
Latest time to complete electronic applications under
White Form eIPO service through the designated
website www.eipo.com.hk (2) ..............................1 1:30 a.m. on Friday,
July 5, 2024
Application lists of the Hong Kong Public Offering open (3) ......... 1 1:45 a.m. on Friday,
July 5, 2024
Latest time for (a) complete payment of White Form eIPO
applications by effecting Internet banking transfer(s) or
PPS payment transfer(s) and (b) give electronic application
instructions to HKSCC
(4) ............................... .12:00 noon on Friday,
July 5, 2024
If you are 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 through the HKSCC EIPO channel, you are advised to contact your
broker or custodian for the earliest and latest time for giving such instructions which may be
different from the latest time as stated above, as this may vary by broker or custodian.
Application lists of the Hong Kong Public Offering close
(3) ....... .12:00 noon on Friday,
July 5, 2024
Announcement of an indication of the of
level 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
to be published on the websites of the Stock Exchange at
www.hkexnews.hk and our Company at www.voicecomm.cn on
or before (4) ...........................................T uesday, July 9, 2024
EXPECTED TIMETABLE
– iii –


--- page 6 ---
Announcement of results of allocations in the Hong Kong Public Offering (including
successful applicants’ identification document numbers, where appropriate) to be available
through a variety of channels including:
 the announcement to be posted on websites of the
Stock Exchange at www.hkexnews.hk and
our Company’s website at
www.voicecomm.cn (5) ............................T uesday, July 9, 2024
 from the designated results of allocations for the Hong Kong
Public Offering will be available at www.iporesults.com.hk
(alternatively: www.eipo.com.hk/eIPOAllotment )
with a “search by ID” function .......................... from 11:00 p.m.
on Tuesday, July 9, 2024
to 12:00 midnight
on Monday, July 15, 2024
 from the allocation results telephone enquiry by
calling +852 2862 8555 between
9:00 a.m. and 6:00 p.m. ................... from Wednesday, July 10, 2024
to Monday, July 15, 2024
(excluding Saturday, Sunday and
public holidays in Hong Kong)
Dispatch of H Share certificates or deposit of
Share certificates into CCASS in respect of wholly or
partially successful applications pursuant to
the Hong Kong Public Offering on
or before
(5) ........................................... T uesday, July 9, 2024
White Form e-Refund payment instructions/refund
cheques in respect of wholly or partially successful
applications or wholly or partially unsuccessful
applications to be dispatched/collected
on or before
(6) ...................................... W ednesday, July 10, 2024
Dealings in H Shares on the Stock Exchange to
commence at 9:00 a.m. on ............................W ednesday, July 10, 2024
EXPECTED TIMETABLE
–i v–


--- page 7 ---
The application for the Hong Kong Offer Shares will commence on Friday, June 28,
2024 through Friday, July 5, 2024, being longer than normal market practice of three and
a half days. The application monies (inclusive of brokerage, SFC transaction levy, Hong
Kong Stock Exchange trading fee and AFRC transaction levy) will be held by the
receiving banks on behalf of the Company and the refund monies, if any, will be returned
to the applicants without interest on Wednesday, July 10, 2024. Investors should be aware
that the dealings in the Shares on the Hong Kong Stock Exchange are expected to
commence on Wednesday, July 10, 2024.
Notes:
(1) All times and dates refer to Hong Kong local time and date, except as otherwise stated.
(2) You need to submit your application under the White Form eIPO service through the designated website at
www.eipo.com.hk from 9:00 a.m. on Friday, June 28, 2024 to 11:30 a.m. on Friday, July 5, 2024 for submitting
applications. The latest time for completing full payment of application monies will be 12:00 noon on Friday,
July 5, 2024.
(3) If there is a typhoon warning signal number 8 or above, Extreme Conditions and/or a “black” rainstorm
warning at any time between 9:00 a.m. and 12:00 noon on Friday, July 5, 2024, the application lists will not
open on that day. See “How to Apply for Hong Kong Offer Shares – E. Severe Weather Arrangements” in this
prospectus.
(4) None of the websites or any of the information contained on the websites forms part of this Prospectus.
(5) H Share certificates will only become valid evidence of title at 8:00 a.m. on the Listing Date, which is expected
to be Wednesday, July 10, 2024, provided that the Global Offering has become unconditional in all respects
at or before that time. Investors who trade H Shares on the basis of publicly available allocation details before
the receipt of H share certificates and before they become valid do so entirely of their own risk.
(6) Applicants being individuals who are eligible for personal collection may not authorize any other person to
collect on their behalf. Individuals 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 HKSCC EIPO channel should refer to the
section headed “How to Apply for the Hong Kong Offer Shares – D. Despatch/Collection of H Share
Certificates and Refund of Application Monies” in this prospectus 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
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.
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 the sections headed “How to Apply for the Hong Kong Offer Shares – D.
Despatch/Collection of H Share Certificates and Refund of Application Monies”.
The above expected timetable is a summary only. Y ou should read carefully the
sections headed “Underwriting”, “Structure of the Global Offering” and “How to Apply
for Hong Kong Offer Shares” of this Prospectus for details relating to the structure of the
Global Offering, procedures on the applications for Hong Kong Offer Shares and the
expected timetable, including conditions, effect of bad weather and the dispatch of refund
cheques and H Share certificates.
EXPECTED TIMETABLE
–v–


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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 or
invitation 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
jurisdiction 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 Overall Coordinator , the Joint Global Coordinators, the
Joint Bookrunners, the Joint Lead Managers, the Underwriters, any of our or their
respective directors, officers, employees, partners, agents or representatives, or any other
party involved in the Global Offering. Information contained on our website
www.voicecomm.cn does not form part of this prospectus.
Page
Expected Timetable ................................................. i i i
Table of Contents .................................................. v i
Summary ......................................................... 1
Definitions ........................................................ 2 7
Glossary of Technical Terms ......................................... 4 2
Forward-looking Statements .......................................... 5 1
Risk Factors ...................................................... 5 3
Information about this Prospectus and the Global Offering ................ 1 0 0
Waivers from Strict Compliance with the Listing Rules .................... 1 0 5
Directors, Supervisors and Parties Involved in the Global Offering .......... 1 0 9
TABLE OF CONTENTS
–v i–


--- page 9 ---
Corporate Information .............................................. 1 2 4
Industry Overview ................................................. 1 2 6
Regulatory Overview ............................................... 1 4 7
History, Development and Corporate Structure .......................... 1 6 7
Business .......................................................... 2 2 6
Relationship with our Controlling Shareholders .......................... 3 5 7
Share Capital ..................................................... 3 6 2
Substantial Shareholders ............................................ 3 6 7
Directors, Supervisors and Senior Management .......................... 3 7 6
Financial Information ............................................... 3 9 6
Future Plans and Use of Proceeds ..................................... 4 7 4
Cornerstone Investors ............................................... 4 8 1
Underwriting ...................................................... 4 8 8
Structure of the Global Offering ...................................... 5 0 1
How to Apply for Hong Kong Offer Shares ............................. 5 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
Appendix V – Summary of Articles of Association .................. V - 1
Appendix VI – Statutory and General Information .................. VI-1
Appendix VII – Documents Delivered to the Registrar of Companies and
Available on Display ............................ VII-1
TABLE OF CONTENTS
– vii –


--- page 10 ---
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 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 IT solution provider in China. Based upon our technologies, we provide
services for enterprise-level users to improve the level of convenience and intelligence for their
information exchanges and business interactions. Our solutions are built upon our technologies
comprising core conversational AI technologies, unified communication technologies, and
other AI and computer technologies. Our unified communication technologies, core
conversational AI technologies and product engine technologies address enterprise-level user’s
demand of “communication”, “thinking” and “execution”, respectively, thus facilitating a
complete enterprise-level conversational AI experience. According to the iResearch Report, we
rank the second in the full-stack
(note) enterprise-level conversational AI solution market in
China as measured by revenue in 2023, representing a market share of 3.8%, where the first
largest solution provider has a market share of 13.1%. According to the same source and by the
same measure, we rank the sixth in the enterprise-level conversational AI solution market in
China, representing a market share of 1.3%, and have a market share of 1.2% in the entire
conversational AI solution market in China that reached RMB67.8 billion in 2023.
During the Track Record Period, we primarily offered our solutions to four key
end-customer industries where we had accumulated rich industry know-how, engineering
experiences and customer insights, i.e., city management and administration, automotive and
transportation, telecommunications, and finance. Our solution offerings are enabled by
V oicecomm Brain, our technology infrastructure, and V oicecomm Suites, our functional
modules. V oicecomm Brain is underpinned by our core technologies in both unified
communications and AI. On top of our V oicecomm Brain, we have developed a full set of
V oicecomm Suites, the modular combination of which allows us to offer different types of
solutions. Depending upon specific users’ concrete needs, our solutions involve core
conversational AI technologies, unified communication technologies and/or other technologies
to varying extent, and core conversational AI technologies may not be significant in certain
applications. During the Track Record Period, core conversational AI technologies had been
Note: “Full-stack” refers to the characteristics of the enterprise-level conversational AI solutions that distinguish
them from non-full-stack enterprise-level conversational AI solutions by virtue of its integration of unified
communication and essential AI algorithm capabilities, so as to address a number of pain points experienced
by enterprise-level users. In 2023, the full-stack enterprise-level conversational AI solution market takes up
34.0% of the entire enterprise-level conversational AI solution market in China, according to the iResearch
Report.
SUMMARY
–1–


--- page 11 ---
applied in most of our existing projects, and we also elected to offer solutions to customers
currently only demanding the realization of unified communications with a goal to further
upsell core conversational AI technologies. To the best knowledge of our Directors, our
projects that applied core conversational AI technologies contributed to approximately 89%,
89% and 92% of our revenue generated from offering enterprise-level solutions in 2021, 2022
and 2023, respectively.
During the Track Record Period, our research and development expenses amounted to
RMB36.3 million, RMB64.0 million and RMB98.8 million in 2021, 2022 and 2023,
respectively, among which, technology service fees amounted to RMB20.1 million, RMB29.1
million and RMB46.4 million in 2021, 2022, and 2023, respectively, representing 55.3%,
45.5%, and 47.0% of our research and development expenses in the same years, respectively.
Such technology service fees represented outsourcing costs for certain non-core and less
sophisticated research and development programs. For details, see “Financial Information –
Description of Selected Components of Consolidated Statements of Profit or Loss – Research
and Development Expenses” in this prospectus. In addition to such expensed expenditures, we
also recorded carrying amount of purchased software, net of accumulated amortization of
RMB16.2 million, RMB95.1 million and RMB97.0 million as of December 31, 2021, 2022 and
2023, respectively, primarily in relation to (i) areas that synergize with our technologies to
allow speedy offering of solutions catering to enterprise-level users’ demands; (ii) management
and optimization of multimodal data, which could improve our efficiency for AI algorithm
training; and (iii) other technologies that render coordination in specific application scenarios
of our solutions. For details, see “Financial Information – Discussion of Selected Items from
Consolidated Statements of Financial Position – Intangible Assets” in this prospectus. Also, we
collaborate with Baidu regarding the implementation of ERNIE Bot, its chatbot product, into
enterprise-level conversational AI application scenarios. For details, see “Business – Our
Technologies – Conversational AI Technologies – Technological Collaboration” in this
prospectus.
Empowered by our enterprise-level solution offerings and delivery capabilities, our
revenue increased rapidly during the Track Record Period, during which time we also achieved
continuously improving gross profit margin. The following table sets forth our total revenue,
gross profit and gross profit margin in each year of the Track Record Period:
Y ear Ended December 31,
2021 2022 2023
Revenue (RMB’000) 459,935 514,992 813,017
Gross profit (RMB’000) 152,162 201,466 325,417
Gross profit margin (%) 33.1% 39.1% 40.0%
SUMMARY
–2–


--- page 12 ---
Thanks to our technology infrastructure and standardized solution offerings, we are able
to maintain stable profitability from our operations, with our adjusted net profit (a non-IFRS
measure) amounting to RMB62.3 million, RMB71.7 million and RMB117.7 million in 2021,
2022 and 2023, respectively.
Our Solution Offerings
Through years of iterative research and development, we have offered various enterprise-
level solutions in a number of end-customer industries including city management and
administration, automotive and transportation, telecommunications, finance, as well as
education, healthcare, tourism, the media, E-commerce and retailing, etc., using V oicecomm
Brain and V oicecomm Suites, as illustrated by the following diagram:
City
Management and
Administration
Automotive and
Transportation
CiCiCiiCi
ttttt
y
Telecommunications Finance
Communication ExecutionThinking
Multi-Media
Gateways
Intelligent
Softswitch
n
t
e
lllliig
e
n
Workflow
Tools
W
o
r
kk
ff
lol
Product
Tools
P
 dd
 t
n
t
e
llig
e
n
t
 P
r
odu
Voicecomm
Suites
Voicecomm
Brain
Voicecomm
Solutions
Language
Understanding
L
U
Knowledge
Graphs
Language
Generation
Speech
Recognition
Emotion
Recognition
Speech
Synthesis
Our Solutions Applied in V arious End-Customer Industries – V oicecomm Solutions
Leveraging V oicecomm Brain and V oicecomm Suites, we have offered various types of
enterprise-level solutions proven to have effectively improved the level of convenience and
intelligence with respect to enterprise-level users’ information exchanges and business
interactions. In particular, our solutions have been used by enterprise-level users from various
end-customer industries, primarily including city management and administration, automotive
and transportation, telecommunications, and finance. We have also established and are further
expanding the presence of our solutions into other industries such as the media, healthcare,
E-commerce and retailing, etc., that can be empowered by conversational AI.
SUMMARY
–3–


--- page 13 ---
 City Management and Administration. Our solutions have primarily been applied
in intelligent community (comprehensive governmental projects involving diverse
application scenarios), intelligent administration and intelligent internet of things
(IoT), where our technologies contribute to the establishment of smart cities where
city infrastructure, public spaces and objects are interactively connected, and also
make city management and administrative services more convenient and intelligent.
For example, our solutions have been applied in local governments’ “12345”
hotlines, where our core conversational AI technologies assist human agent seats to
understand, reply to and document calling citizens’ requests, and our unified
communication technologies expand the handling scope of such hotlines pre-call
and facilitate the issue-solving process post-call. For more details, see “Our Solution
Offerings – V oicecomm Solutions – City Management and Administration – Case
Study – Case Study 2: Conversational AI “12345” Hotline Solutions” in this
prospectus.
 Automotive and Transportation. Our solutions have primarily been applied in
customer service for automobile and logistics companies, internet of vehicles (IoV)
service that enables a smart cockpit and facilitates the intelligent scheduling of
vehicle resources and route navigation, as well as vehicle-to-everything (V2X)
autonomous driving, which helps realize a safe, convenient, intelligent and
integrated automobile management and travel experience. For example, our
solutions have been applied by automobile and logistics companies to establish
well-connected multinational intelligent customer service centers, where our unified
communication technologies ensure the integration of calls made from various
countries, and our core conversational AI technologies enable speech-based
interactions based upon different foreign languages. For more details, see “Our
Solution Offerings – V oicecomm Solutions – Automotive and Transportation – Case
Study – Case Study 1: Multinational Intelligent Customer Service Centers” in this
prospectus.
 Telecommunications. Our solutions can empower telecommunications companies’
communication tools and other value-added services. Such solutions allow various
communication and management needs of the enterprises that have procured such
communication tools and value-added services to be intelligently satisfied, while
substantially lowering deployment and maintenance costs. For example, our
solutions have been applied in enterprises’ cloud-based phone systems, integrating
multimodal information and various communication terminals so as to facilitate
enterprises’ communication needs. Realized primarily through our unified
communication technologies, the solutions are embedded with value-added
functions based upon our core conversational AI technologies and collaboration
solutions that improve enterprises’ work and communication efficiency. With an
emphasis on information infrastructure and data protection, such solutions can
ensure the security environment of the cloud hosted thereby while not compromising
the cost-effective advantages of such solutions. For more details, see “Our Solution
Offerings – V oicecomm Solutions – Telecommunications – Case Study – Case Study
1: Cloud-Based Phone System Solutions” in this prospectus.
SUMMARY
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 Finance. Our solutions offered to financial institutions have been applied primarily
to upgrade their customer services and promote the comprehensive intelligent
transformation of the finance industry. For example, our solutions have been applied
in telephone banking, enabling intelligent virtual agents capable of intelligent
conversational interactions with the callers/callees based upon our core
conversational AI technologies, and realizing the seamless switch to human agent
seats for complex issues by virtue of our unified communication technologies. For
more details, see “Our Solution Offerings – V oicecomm Solutions – Finance – Case
Study – Case Study 1: Intelligent Virtual Agent Solutions for Banks” in this
prospectus. Additionally, we also offer solutions in service training that facilitate
their internal processes.
Our Technology Infrastructure – V oicecomm Brain
V oicecomm Brain, our technology infrastructure, is underpinned by our core technologies
in both unified communications and AI. V oicecomm Brain affords enterprise-level users with
the following key values:
 Quality and Reliability. V oicecomm Brain is able to achieve a time interval
between failures (the elapsed time between inherent failures during normal system
operation) of 50 thousand hours, seamless redundant switching of servers without
user awareness, as well as an average multimodal information transmission success
rate of 99.999%, which lead above the industry average in China according to the
iResearch Report.
 High Compatibility. V oicecomm Brain is compatible with the three major
international protocols for computer telecommunications integration (CTI), i.e.,
TAPI, TSAPI and CSTA, and the three major types of signal communication
methods, i.e., analog transmission, digital transmission and SIP-based
communications. In addition, V oicecomm Brain is compatible with various types of
organizational operating systems, including but not limited to that on office
automation, customer relationship management and enterprise resource planning.
 Synergetic Technological Capabilities. Our core technologies in unified
communications and AI synergize with each other effectively. For instance, our
voiceprint recognition technology is uniquely empowered by our technologies
analyzing the underlying communication protocols used for transmission of signals
via different terminal devices, which realizes the accurate audio source separation
and intelligent analysis of conversations involving multiple speakers.
 Cost Efficiency. V oicecomm Brain can realize cost efficiency for users by
significantly improving their communication efficiency with substantially lowered
costs, thereby facilitating the rapid expansion of their operation scale. Take our
conversational AI administrative service solution deployed in Zibo, Shandong as an
example, it enabled cost reduction by more than 85% compared with the solutions
previously used therein, while the efficiency for reaching out to callees increased by
tens of times and the administrative service completion rate exceeded 80%.
SUMMARY
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Our Functional Modules – V oicecomm Suites
To realize large-scale deployment of our solutions and their quick replications in adjacent
use cases, we have developed a full set of functional modules, V oicecomm Suites. Covering
various steps of enterprise-level users’ end-to-end information exchanges and business
interactions, such modules can effectively address a number of pain points manifested in the
enterprise-level conversational AI solution market, such as the needs of one-stop and in-depth
service, convenient application-scenario expansion, selectable delivery and cost efficiency. For
details, see “Business – Our Solution Offerings” in this prospectus. The major features and
advantages of V oicecomm Suites are as follows:
 Completeness. V oicecomm Suites in aggregate functionally enable the processing
and two-way transmission of the underlying communication signals, AI
empowerment in the application layer, and algorithm-equipped and productized
operational interface-side tools.
 High Standardization. Characterized by their high level of standardization,
V oicecomm Suites can empower users’ business operations in a cost-efficient
fashion and help us achieve economies of scale by allowing us to readily replicate
and adjust our solution offerings in similar application scenarios.
 High Scalability. V oicecomm Suites support free combination among themselves
and output differently in accordance with users’ specific business needs, and also
enable interfacing with their various systems and software, through which we are
able to diversify our solutions to the degree needed conveniently.
 Low-Code. V oicecomm Suites allow development personnel of users to realize the
software applications that they want efficiently and agilely based upon application
programming interfaces (APIs) in a low-code fashion featuring high stability and
easy-to-use.
OUR REVENUE MODEL
During the Track Record Period, we generated our revenue on a project basis mainly from
offering enterprise-level solutions enabled primarily by our technologies on unified
communications and AI to our customers. Depending upon specific users’ concrete needs, the
extent to which a certain solution involves each category of technologies may vary. During the
Track Record Period, core conversational AI technologies had been applied in most of our
existing projects. As the record of such technologies being discretionarily applied after
implementation is documented within the enterprise-level users’ own systems, historical data
regarding the frequency at which such technologies were applied in the relevant projects are
unavailable from our end and inherently contingent upon the conversation volumes involved,
which can vary significantly across diverse scenarios of different end-customer industries. For
SUMMARY
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details of use cases showcasing the variations of applications of our core conversational AI
technologies, see “Business – Our Revenue Model” in this prospectus. The following diagram
illustrates our revenue model as well as the service flow and funds flow in relation to our
solutions:
Suppliers
• Communication
devices
 Servers and
computers
 network and other
telecommunication
resources...
System
Integrators*
Enterprise-Level
Users*
 Governmental
entities
 Automobile
companies
 Telecommunication
companies
 Financial Institutions
 Other enterprises...
SSSSSSSSSSS
EEEEEEEEEEEEnEE
hardware
offerings bundling
our solutions
Enterprise-Level
Users
 Governmental
entities
 Automobile
companies
 Telecommunication
companies
 Financial Institutions
 Other enterprises...
n
g
 EEEEEEEEnEsoftware only/software
plus hardware
solutions
software only/software
plus hardware
solutions
Service flow
Funds flow
As our customers*
Specifically, our customers for our solutions during the Track Record Period included: (i)
system integrators that embedded our solutions into their offerings to enterprise-level users;
and (ii) enterprise-level users that used our solutions directly. The following table sets forth a
breakdown of our revenue generated from offering solutions by customer types, in absolute
amounts and as a percentage of total solution revenue, for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Revenue from
– System integrators 381,101 83.4 378,897 77.1 638,528 79.7
– Enterprise-Level
users 75,770 16.6 112,744 22.9 162,532 20.3
Total 456,871 100.0 491,641 100.0 801,060 100.0
SUMMARY
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The solutions that we offered during the Track Record Period consisted of: (i) software
only solutions; and (ii) software plus hardware solutions in which we integrated our software
systems with hardware devices, network and other telecommunication resources, and/or other
services (if needed), etc., procured from suppliers as part of our total solutions. The following
table sets forth a breakdown of our revenue generated from offering solutions by solutions
types, in absolute amounts and as a percentage of total solution revenue, for the years
indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Software only solutions 85,447 18.7 162,548 33.1 282,980 35.3
Software plus hardware
solutions 371,424 81.3 329,093 66.9 518,080 64.7
Total 456,871 100.0 491,641 100.0 801,060 100.0
The following table sets forth a breakdown of our gross profit generated from offering
solutions by solution types, in absolute amounts and in terms of gross profit margin for the
years indicated:
Y ear Ended December 31,
2021 2022 2023
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
RMB’000 % RMB’000 % RMB’000 %
Software only
solutions 76,467 89.5 149,468 92.0 229,996 81.3
Software and
hardware
solutions 86,661 23.3 59,707 18.1 95,134 18.4
163,128 35.7 209,175 42.5 325,130 40.6
SUMMARY
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During the Track Record Period, we generated an increasing amount of revenue from our
software only solutions, which also took up an increasing portion in our total revenue, mainly
due to that (i) it is our increasingly heightened focus to scale up offering such solutions of
higher margins in order to enhance our competitive positioning while expanding profit pools
through the maturation and accumulation of our technologies. As we establish and enhance our
market presence, we have gradually adopted the strategy that prioritizes offering software only
solutions in projects in which customers do not specifically demand software plus hardware
delivery or where there is no concrete scenario-specific benefit for doing so, provided that this
priority would not affect our acquisition of such customers; and (ii) the continuous expansion
of our customer bases who typically purchased from us software plus hardware solutions to
firstly establish their communication platforms affords us the opportunities to up-sell software
only solutions later to further diversify and enhance their unified communications and AI
capabilities.
As certain customers may have specific demand on functionalities that are incidental to
our technologies, we from time to time externally purchased software and/or services on
developing project-specific software to enable offering total solutions on a one-stop basis
during the Track Record Period. The following table sets forth a breakdown of our revenue
generated from software only solutions enabled solely by our technologies and those that
incorporated externally purchased software and/or software-development services for the years
indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Software only solutions
– Enabled solely by our
technologies 72,385 84.7 154,456 95.0 219,777 77.7
– Including externally
purchased software
and/or software-
development services 13,062 15.3 8,092 5.0 63,203 22.3
Total 85,447 100.0 162,548 100.0 282,980 100.0
SUMMARY
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Our revenue generated from software only solutions that incorporated externally
purchased software and/or software-development services fluctuated in each year of the Track
Record Period, reflecting the contingent nature of the accessory functionalities demanded the
relevant customers in each year. By contrast, our revenue generated from software only
solutions enabled solely by our technologies increased continuously during the Track Record
Period, which was consistent with the general trend of our revenue growth and also took up the
major portion of our revenue generated from software only solutions. Our revenue generated
from software only solutions enabled solely by our technologies contributed to a less
percentage of our revenue generated from software only solutions in 2023, primarily due to the
fact that we participated in certain projects that involved the purchase of functionally specific
platforms supplementary to our technologies and accordingly generated a greater amount of
revenue during the same period. Specifically, we primarily purchased externally for certain
platforms for data analytic and management, and vehicle inspection to offer the relevant IoV
solutions, as well as that for human resource maintenance to offer the relevant intelligent
administration solutions, in each case on a one-stop basis.
During the Track Record Period, we generated our revenue primarily from providing our
solutions in a number of end-customer industries, mainly including city management and
administration, automotive and transportation, telecommunications, and finance. The following
table sets forth a breakdown of our revenue generated from offering solutions by end-customer
industries, in absolute amounts and as a percentage of total solution revenue, for the years
indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
City management and
administration 165,075 36.1 192,734 39.2 321,239 40.1
Automotive and
transportation 81,251 17.8 83,393 17.0 191,077 23.9
Telecommunications 68,385 15.0 91,782 18.7 173,976 21.7
Finance 96,051 21.0 79,745 16.2 84,530 10.5
Other industries 46,109 10.1 43,987 8.9 30,238 3.8
Total 456,871 100.0 491,641 100.0 801,060 100.0
SUMMARY
–1 0–


--- page 20 ---
Project Backlog
The following table sets forth the movement of the number of our projects in each year
of the Track Record Period and up to the Latest Practicable Date:
Y ear Ended December 31,
From
January 1,
2024 and
up to the
Latest
Practicable
Date2021 2022 2023
Number of ongoing projects at
the beginning of the
year/period 64 60 84 150
Add: Number of newly
awarded projects 204 197 298 151
Less: Number of projects
completed 208 173 232 106
Number of ongoing projects at
the end of the year/period 60 84 150 195
The following table sets forth the rolling backlog of our projects by outstanding contract
sum in each year of the Track Record Period and up to the Latest Practicable Date:
Y ear Ended December 31,
From
January 1,
2024 and
up to the
Latest
Practicable
Date2021 2022 2023
RMB’000 RMB’000 RMB’000 RMB’000
Outstanding balance at the
beginning of the year/period 324,582 297,884 382,476 500,850
Add: Contract value of newly
awarded projects 476,136 625,401 1,013,744 473,415
Less: Revenue (V AT inclusive)
recognized during the
year/period* 502,833 540,809 895,370 405,281
Outstanding balance at the end
of the year/period 297,884 382,476 500,850 568,983
Note:
* As the contract value according to the agreement is inclusive of V AT, for the purposes of calculating the
project backlog, the revenue recognized during the relevant year/period also includes V AT.
SUMMARY
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--- page 21 ---
OUR CUSTOMERS
During the Track Record Period, we mainly had two main categories of customers: (i)
solution partner customers, who were primarily third-party system integrators that embedded
our solutions into their offerings to cater to enterprise-level users’ needs; and (ii) enterprise-
level users purchasing and using our solutions directly. Sales amount generated from our five
largest customers in each year of the Track Record Period represented 43.0%, 37.2% and 35.4%
of our total sales amount for the same years, respectively. For details, see “Business –
Customers and Customer Support” in this prospectus. Besides, revenue generated from our
largest project during each year of the Track Record Period amounted to RMB121.4 million,
RMB128.5 million and RMB134.8 million, respectively, which entails the establishment of a
digitalized technological infrastructure for an intelligent town cluster in Chengdu where the
administration, production and service activities, healthcare, security and educations, etc., of
more than 200 towns are being unified and integrated into one public service platform. For
details, see “Business – Our Solution Offerings – V oicecomm Solutions – City Management
and Administration – Case Study – Case Study 1: Intelligent Town Project in Chengdu” in this
prospectus.
OUR SUPPLIERS
During the Track Record Period, our suppliers consisted primarily of (i) providers of
hardware components such as communication devices, servers and computers that were or are
to be integrated into our solutions; (ii) telecommunications companies with whom we
cooperated for providing network and other telecommunication resources; (iii) providers of
certain non-core and less sophisticated research and development programs; (iv) providers of
cloud services; and (v) our business partners whose software/services were embedded into our
solutions. Purchase amount from our five largest suppliers in each year of the Track Record
Period represented 72.6%, 65.9% and 63.0% of our total purchase amount for the same years,
respectively. For details, see “Business – Suppliers and Procurement” in this prospectus.
MARKET OPPORTUNITIES
According to the iResearch Report, the enterprise-level conversational AI solution market
in China reached RMB62.1 billion in 2023, and is expected to reach RMB204.1 billion in 2028,
at a CAGR of 26.9% from 2023 to 2028. However, the penetration rate of enterprise-level
conversational AI solutions in China was merely 11.6% in 2023, as compared to 18.2% for the
U.S., according to the same source. Currently, the penetration rate of enterprise-level
conversational AI solutions in China still has huge growth potentials, which is estimated to
increase to 16.2% in 2028.
China’s enterprise-level conversational AI solution market is currently still experiencing
a number of pain points, which makes it especially challenging for non-full-stack solution
providers to fundamentally address the needs of enterprise-level users, such as one-stop and
in-depth service, convenient application-scenario expansion, selectable delivery and cost
efficiency. It is expected that full-stack enterprise-level conversational AI solution providers
SUMMARY
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that possess unified communication and essential AI algorithm capabilities with the ability to
self-develop conversational AI applications will seize greater market opportunities by fully
exercising their technological advantages. By continuously exploring into innovative
application scenarios, we aim to solve the pain points of the industry and make efficient
enterprise-level communications at fingertips.
OUR COMPETITIVE STRENGTHS
We believe that the following strengths have contributed to our success and differentiated
us from our competitors:
 A seasoned IT solution provider with nearly two decades’ dedication to enterprise-
level conversational AI;
 Complete full-stack technology infrastructure;
 Highly standardized and scalable offering capabilities that facilitate solution
launches and continuously improve operating efficiency;
 Sustainable growth empowered by a vibrant conversational AI ecosystem; and
 Industry-dedicated and visionary management team.
OUR STRATEGIES
 Further invest in research and development to ensure the leading position and
innovativeness of our conversational AI technologies;
 Strengthen our commercialization capabilities by enriching our solution offerings;
 Enhance our connections with industrial participants to support a more prosperous
conversational AI ecosystem that further realizes sustainable development; and
 Actively expand into Southeast Asia and other international markets.
RISK FACTORS
Our business faces risks including those set out in “Risk Factors” in this prospectus. As
different investors may have different interpretations and criteria when determining the
significance of a risk, you should read the “Risk Factors” section in its entirety before you
decide to invest in our Offer Shares. Some of the major risks that we face include: (i) we are
subject to credit risk related to defaults of customers as our trade receivables balance and trade
receivables turnover days increased significantly during the Track Record Period, and any
significant delay in payment or default on our trade receivables could materially and adversely
affect our liquidity, working capital, financial condition and results of operations; (ii) as our
SUMMARY
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business is subject to complex and evolving laws, regulations and governmental policies
regarding cybersecurity, privacy and data protection and generative AI services, actual or
alleged failure to comply with applicable laws, regulations and governmental policies could
damage our reputation, deter current and potential customers or end users from using our
solutions, and subject us to significant legal, financial and operational consequences; (iii) as
the industry in which we operate is highly competitive, our results of operations could be
harmed if we do not effectively compete against our current or future competitors, which may
particularly include major technology giants and cloud service companies; (iv) if we fail to
continuously develop and innovate our solutions to meet enterprise-level users’ evolving needs,
our business, financial condition and results of operations may be materially and adversely
affected; (v) we derived a significant portion of revenue from our intelligent town project in
Chengdu during the Track Record Period; and (vi) we recognized substantial goodwill and
intangible assets during the Track Record Period and may incur significant impairment charges
related thereto, which may adversely affect our results of operations as a result.
SUMMARY OF KEY FINANCIAL INFORMATION
The following tables summarize our consolidated financial results during the Track
Record Period and should be read in conjunction with “Financial Information” of this
prospectus and the Accountants’ Report set out in Appendix I to this prospectus, together with
the respective accompanying notes.
Summary Consolidated Statements of Profit or Loss
The following table sets forth a summary of our consolidated statements of profit or loss
for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Revenue 459,935 514,992 813,017
Cost of revenue (307,773) (313,526) (487,600)
Gross Profit 152,162 201,466 325,417
Other revenue 7,692 11,016 27,226
Other net gain/(loss) 200 (16) (25)
Research and development expenses (36,310) (63,983) (98,798)
Selling and marketing expenses (3,162) (7,249) (10,347)
Administrative and other operating
expenses (24,552) (31,486) (58,499)
Impairment loss on trade receivables (17,444) (42,562) (55,379)
SUMMARY
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--- page 24 ---
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Profit from operations 78,586 67,186 129,595
Net finance costs (8,183) (9,034) (11,696)
Changes in carrying amount of
redeemable capital contributions (25,950) (157,504) (146,892)
Changes in fair value of financial assets
measured at fair value through profit
or loss – 8,337 258
Share of (loss)/gain of associates (22) 131 (20)
Profit/(loss) before taxation 44,431 (90,884) (28,755)
Income tax (8,047) 5,073 (446)
Profit/(loss) for the year 36,384 (85,811) (29,201)
Attributable to
Equity shareholder of our Company 36,895 (87,155) (33,754)
Non-controlling interests (511) 1,344 4,553
Non-IFRS Measure
To supplement our consolidated financial statements which are presented in accordance
with IFRS, we also use the adjusted net profit (a non-IFRS measure) as an additional financial
measure, which is not required by, or presented in accordance with, IFRS. We believe that such
non-IFRS measure facilitates comparisons of operating performance from period to period and
company to company by eliminating potential impacts of certain items. We believe that such
measure provides useful information to investors and others in understanding and evaluating
our consolidated results of operations in the same manner as it helps our management.
However, our presentation of the adjusted net profit (a non-IFRS measure) may not be
comparable to similarly titled measures presented by other companies. The use of such
non-IFRS measure has limitations as an analytical tool, and you should not consider it in
isolation from, or as substitute for analysis of, our results of operations or financial condition
as reported under IFRS.
SUMMARY
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--- page 25 ---
We define the adjusted net profit (a non-IFRS measure) as profit for the year by
eliminating the impacts of changes in carrying amount of redeemable capital contributions. The
following table reconciles our adjusted net profit (a non-IFRS measure) presented to the
financial measure calculated and presented in accordance with IFRS, namely profit/loss for the
year:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Reconciliation of profit/loss for the
year and adjusted net profit
(a non-IFRS measure)
Profit/(loss) for the year 36,384 (85,811) (29,201)
Add:
Changes in carrying amount of
redeemable capital contributions 25,950 157,504 146,892
Adjusted net profit (a non-IFRS
measure) 62,334 71,693 117,691
Our management considers that changes in carrying amount of redeemable capital
contributions is a non-cash item, primarily due to which we incurred net loss for the year of
2022 and 2023 and such carrying amount will be reclassified from financial liabilities to equity
upon completion of the Listing and the Global Offering. Therefore, by eliminating the impacts
of the said item in the calculation of the adjusted net profit (a non-IFRS measure), such
measure could better reflect our underlying operating performance and could better facilitate
the comparison of operating performance from year to year.
Discussion of Fluctuations of Net Profit
We incurred profit for the year of RMB36.4 million in 2021 and loss for the year of
RMB85.8 million in 2022, primarily due to changes in carrying amount of redeemable capital
contributions, which offset the increase in our revenue and gross profit. Our loss for the year
then decreased to RMB29.2 million in 2023, primarily due to a significant increase in our
revenue and gross profit, which offset the increase in our research and development expenses
and administrative and other operating expenses, among other expenses. The aforesaid
negative impact of changes in carrying amount of redeemable capital contributions on our net
profit during the Track Record Period was in relation to our obligation to repurchase equity
investments respecting the Pre-IPO Investments and as a result of our growing market
capitalization, which will be eliminated upon completion of the Listing and the Global
Offering.
SUMMARY
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--- page 26 ---
Summary of Consolidated Statements of Financial Position
The table below sets forth selected information from our consolidated statements of
financial position as of the dates indicated:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Total non-current assets 152,991 300,678 489,064
Current assets
Inventories and other contract costs 112,475 95,269 7,653
Trade and other receivables 242,812 339,674 602,705
Prepayments 95,296 139,219 233,834
Cash 10,641 20,434 46,876
Total current assets 461,224 594,596 891,068
Current liabilities
Trade and other payables 46,518 59,433 43,389
Contract liabilities 26,732 31,127 97,423
Bank loans and other borrowings 150,663 211,650 342,000
Lease liabilities 2,302 4,128 8,115
Taxation payable 2,897 2,890 3,169
Redeemable capital contributions 265,666 527,970 852,912
Total current liabilities 494,778 837,198 1,347,008
Net current liabilities (33,554) (242,602) (455,940)
Total non-current liabilities 9,677 23,433 25,552
Net assets 109,760 34,643 7,572
Total equity/(deficit) attributable to
equity shareholders of our Company 107,059 19,941 (11,683)
Non-controlling interests 2,701 14,702 19,255
SUMMARY
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--- page 27 ---
We had net current liabilities of RMB33.6 million, RMB242.6 million and RMB455.9
million as of December 31, 2021, 2022 and 2023, respectively, primarily due to a continuous
increase in our (i) redeemable capital contributions; and (ii) bank loans and other borrowings.
The aforementioned significant amount of our redeemable capital contributions was in relation
to our obligation to repurchase equity investments respecting the Pre-IPO Investments and as
a result of our growing market capitalization, and the increase in our bank loans and other
borrowings were incurred to fund our continuously expanded business. We expect to turn our
net current liabilities position into net current assets upon completion of the Listing and the
Global Offering, as carrying amount of such redeemable capital contributions will be
reclassified from financial liabilities to equity as a result of the termination of the preferred
rights. For details, see “Financial Information – Discussion on Selected Items from
Consolidated Statements of Financial Position – Redeemable Capital Contributions” in this
prospectus.
Our net assets decreased from RMB109.8 million as of December 31, 2021 to RMB34.6
million as of December 31, 2022, mainly reflecting changes in equity primarily resulting from
our loss for the year of 2022 of RMB85.8 million. Our net assets decreased from RMB34.6
million as of December 31, 2022 to RMB7.6 million as of December 31, 2023, mainly
reflecting changes in equity primarily resulting from our loss for the year of 2023 of RMB29.2
million.
Summary of Consolidated Statements of Cash Flows
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cash generated from operations before
movements in working capital 99,664 127,678 215,526
Changes in working capital (158,414) (150,912) (282,141)
Tax paid (16,328) (7,880) (1,454)
Net cash used in operating activities (75,078) (31,114) (68,069)
Net cash used in investing activities (108,142) (140,677) (184,386)
Net cash generated from financing activities 186,719 181,584 278,897
Net increase in cash 3,499 9,793 26,442
Cash at beginning of the year 7,142 10,641 20,434
Cash at end of the year 10,641 20,434 46,876
SUMMARY
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--- page 28 ---
We incurred net cash used in operating activities during the Track Record Period,
primarily as a result of the increase in our trade and other receivables and prepayments,
offsetting our profit/loss before taxation adjusted for non-cash and non-operating items in a
positive net effect. Our net cash used in investing activities increased from RMB108.1 million
in 2021 to RMB140.7 million in 2022, primarily as a result of a significant increase in payment
for the acquisition of intangible assets. Our net cash used in investing activities further
increased to RMB184.4 million in 2023, primarily as a result of a significant increase in
payment for the acquisition of property and equipment. Our net cash generated from financing
activities increased substantially from RMB181.6 million in 2022 to RMB278.9 million in
2023, primarily as a result of a significant increase in proceeds from redeemable capital
contributions and proceeds from bank loans and other borrowings, offsetting an increase in
repayment of bank loans and other borrowings. For details, see “Financial Information –
Liquidity and Capital Resources” in this prospectus.
PRIOR QUOTATION AND WITHDRA W AL FROM QUOTATION ON THE N BOARD
Our Shares had been quoted on the N Board under the stock code 300005 from December
18, 2015 to December 23, 2022 (both days inclusive). Concurrently upon the withdrawal from
quotation on the N Board, our Company was transferred to the Q Board as approved by the
Shanghai Equity Exchange. On August 31, 2023, a resolution was passed by the Shareholders
to apply for the withdrawal of quotation from the Q Board. Our application for withdrawal
from quotation on the Q Board was approved by the Shanghai Equity Exchange on 24 February
2024, and the withdrawal was completed on 28 February 2024.
The withdrawal from quotation on the N Board was a commercial and strategic decision
made by our then Directors, with a view to achieving our overall strategic objective to develop
an international financing platform and maximize our shareholders’ value. Our Directors
believe the withdrawal from quotation on the N Board and the Listing on the Stock Exchange
would be in the interests of our Group and the Shareholders as a whole, in particularly, among
others, (i) the Listing on the Stock Exchange would facilitate the identification and
establishment of the fair value of our Group; (ii) the Stock Exchange could offer us a direct
access to the international capital markets, enhance our fund-raising capabilities and channels
and broaden our Shareholders base; (iii) shares listed on the Stock Exchange generally has
higher liquidity as compared to that of the N Board, which would provide better chance of
realising the interest in our Group; and (iv) the Listing will further raise our business profile
and industry presence.
For details, see “History, Development and Corporate Structure – Joint Stock Reform and
Quotation on the N Board” and “History, Development and Corporate Structure – Withdrawal
from Quotation on the N Board” in this prospectus.
SUMMARY
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OUR SHAREHOLDING STRUCTURE
Our Controlling Shareholders
As of the Latest Practicable Date, Mr. Tang, Ms. Xu (the spouse of Mr. Tang and holding
1% of the equity interests in V oicecomm Rongzhi), V oicecomm Rongzhi, Mr. Sun, Jiageng
Culture, Mr. Yang, Mr. Jiang Haisheng (ऎ͛) (holding indirectly 40% of the equity interests
in Jiangfan Technology), Jiangcheng Asset Management (the holding company of Jiangfan
Technology) and Jiangfan Technology were collectively entitled to exercise voting rights of
approximately 35.97% of the total issued shares of our Company, and are considered as a group
of controlling shareholders of our Company before the Listing. Immediately following the
completion of the Global Offering (assuming the Over-allotment Option is not exercised), Mr.
Tang, Ms. Xu, V oicecomm Rongzhi, Mr. Sun, Jiageng Culture, Mr. Yang, Mr. Jiang Haisheng
(ऎ͛), Jiangcheng Asset Management and Jiangfan Technology will be collectively entitled
to exercise voting rights of approximately 31.54% of the total issued shares of our Company,
and hence they will be a group of controlling shareholders of our Company. For details, see
“Relationship with our Controlling Shareholders – Our Controlling Shareholders” in this
prospectus.
Pre-IPO Investments
The Pre-IPO Investments include: (i) Series A Financing; (ii) Series B Financing; (iii)
Series B+ Financing; (iv) Series C Financing; and (v) the 2023 Investments by Equity
Transfers. We raised a total of approximately RMB499.6 million through the Series A
Financing, Series B Financing, Series B+ Financing and Series C Financing. Pursuant to the
PRC Company Law, all the existing Shareholders (including the Pre-IPO Investors) are subject
to a 12-month lock-up period from the Listing Date. Our Pre-IPO Investors consist of private
equity funds, government-led fund and investment holding companies, some with specific
focus on information technology. For details on the Pre-IPO Investments received by us, see
“History, Development and Corporate Structure – Pre-IPO Investments” in this prospectus.
GLOBAL OFFERING STATISTICS
Based on the
Offer Price of
HK$152.10
Market capitalization of our Shares (1) HK$5,388.1
million
Unaudited pro forma adjusted net tangible assets attributable to the
equity shareholders of our Company per Share as of
December 31, 2023
(2)(3)
RMB35.00
(HK$38.38)
SUMMARY
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Notes:
(1) Calculation of market capitalization is based on 35,424,890 Shares expected to be in issue immediately
after completion of the Global Offering.
(2) The unaudited pro forma adjusted net tangible assets attributable to the equity shareholders of our
Company per Share have been arrived at after adjustments referred to in “Unaudited Pro Forma
Financial Information” in Appendix II to this prospectus.
(3) No other adjustment has been made to the unaudited pro forma adjusted net tangible assets to reflect any
trading results or other transactions of our Group entered into subsequent to December 31, 2023.
LISTING EXPENSE
During the Track Record Period, we incurred listing expenses of RMB4.6 million
(HK$5.0 million) and RMB15.9 million (HK$17.5 million) charged to administrative and other
operating expenses in our statements of profit or loss in 2022 and 2023, respectively.
Listing expenses to be borne by us are estimated to be approximately RMB84.2 million
(HK$92.4 million), at the Offer Price of HK$152.10 per Offer Share, and assuming the
Over-allotment Option is not exercised, among which (i) underwriting-related expenses,
including underwriting commission and other expenses are approximately RMB33.3 million
(HK$36.6 million); and (ii) non-underwriting-related expenses are approximately RMB50.9
million (HK$55.8 million), comprising (a) fees and expenses of legal advisors and accountants
of approximately RMB26.9 million (HK$29.5 million); and (b) other fees and expenses of
approximately RMB24.0 million (HK$26.3 million). As of December 31, 2023, we incurred a
total of RMB24.1 million (HK$26.4 million) in listing expenses, among which RMB20.5
million (HK$22.5 million) was recognized in our statements of profit or loss, and RMB3.6
million (HK$3.9 million) is expected to be deducted from equity. We estimate that we will
further incur listing expenses of RMB60.1 million (HK$66.0 million), of which RMB20.7
million (HK$22.7 million) will be recognized in our statements of profit or loss, and RMB39.4
million (HK$43.3 million) will be deducted from equity. Our listing expenses as a percentage
of gross proceeds from the Global Offering will be 13.9%, assuming an Offer Price of
HK$152.10 per Offer Share and that the Over-allotment Option is not exercised. The listing
expenses above are the latest practicable estimate for reference only, and the actual amount
may differ from this estimate.
SUMMARY
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FUTURE PLANS AND USE OF PROCEEDS
At an Offer Price of HK$152.10 per Offer Share, we estimate that we will receive net
proceeds of approximately HK$571.6 million from the Global Offering after deducting the
underwriting commissions and other estimated expenses paid and payable by us in connection
with the Global Offering and assuming that the Over-allotment Option is not exercised. We
currently intend to use the net proceeds we expect to receive from the Global Offering for the
following purposes and in the amounts set out below:
 Approximately 60.0%, or HK$343.0 million, will be used to enhance the
fundamental research on our key technologies, improve the development of our
standardized solutions and iteratively launch diverse commercialization applications
and functions for more business scenarios.
 Approximately 20.0%, or HK$114.3 million, will be allocated to expand our
solution offerings, build our brand and enhance our commercialization capabilities.
 Approximately 10.0%, or HK$57.2 million, will be used to pursue domestic and
overseas strategic investment and acquisition opportunities, so as to implement our
long-term growth strategy to optimize our solutions and expand and penetrate the
end-customer industries that we cover.
 Approximately 10.0%, or HK$57.2 million, will be used for general corporate
purposes.
For details, see “Future Plans and Use of Proceeds” in this prospectus.
DIVIDEND
No dividends were paid or declared by our Company or any of our subsidiaries during the
Track Record Period. Any proposed distribution of dividends shall be formulated by our Board
and will be subject to approval of our Shareholders. A decision to declare or to pay any
dividends in the future, and the amount of any dividend, will depend upon a number of factors,
including our earnings and financial condition, operating requirements, capital requirements,
business prospects, statutory, regulatory and contractual restrictions on our declaration and
payment of dividends, and any other factors that our Directors may consider important.
According to the PRC Company Law , a PRC incorporated company is required to set aside at
least 10% of its after-tax profits each year, after making up previous years’ accumulated losses,
if any, to contribute to certain statutory reserve funds until the aggregate amount contributed
to such funds reaches 50% of its registered capital. Such company may pay dividends out of
after-tax profits after making up for accumulated losses and contributing to statutory reserve
funds as mentioned above. As advised by our PRC Legal Adviser, our Company cannot pay
dividends if it is in an accumulated loss position. Currently, we do not intend to adopt a formal
dividend policy or a fixed dividend distribution ratio following the Global Offering. For
details, see “Financial Information – Dividend” in this prospectus.
SUMMARY
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RECENT DEVELOPMENT
Financial Performance after the Track Record Period
Since the end of the Track Record Period, we have continued developing our business and
we expect that our revenue will further increase for the year of 2024, mainly considering our
continuous penetration into our key end-customer industries and launching our solutions that
can be applied to various enterprise-level scenarios. Specifically, we have been newly awarded
with 151 projects from January 1, 2024 and up to the Latest Practicable Date, and the number
of ongoing projects has increased from 150 as of December 31, 2023 to 195 as of the Latest
Practicable Date. Moreover, the contract value of such newly awarded projects from January
1, 2024 and up to the Latest Practicable Date amounted to RMB473.4 million. For details of
our project backlog in terms of project number and contract amount since the end of the Track
Record Period and up to the Latest Practicable Date, see “Business – Our Project – Project
Backlog” in this prospectus.
In addition to our stable revenue growth, we also expect that our gross profit margin for
the year of 2024 will further improve in comparison with that in 2023, which is continuously
bolstered by (i) the increase in our offerings of higher-margin software systems within our
solutions; and (ii) the increased level of modularization and standardization of our solutions.
As technology is one of the key fundamentals that supports our business development, we
expect to continuously incur considerable research and development expenses in the future,
and our research and development expenses are expected to increase significantly for the year
of 2024. We also expect to incur an increased amount of selling and marketing expenses to
further build our brand and enhance our commercialization capabilities. Additionally, we
expect that changes in carrying amount of redeemable capital contributions for the year of
2024, which is due to our growing market capitalization but will no longer impact our financial
performance upon completion of the Listing and the Global Offering because of the termination
of the relevant preferred shares in connection with the Pre-IPO Investments, will considerably
decrease in 2024. Based upon the foregoing, we expect that we will recognize net profit for the
year of 2024.
Regulatory Update
Recent Regulatory Update Relating to Data Privacy, Cybersecurity and Generative AI
Services
Network Data Security Management Regulations (Draft for Comment) (the “Draft
Regulations”)
On November 14, 2021, the CAC released the Draft Regulations, which stipulate several
requirements for entities who process data through the use of networks, including that data
processors shall (i) be responsible for the security of the data it processed and shall undertake
data protection obligations; and (ii) establish comprehensive data protection system and
technical protection mechanism. For details of the Draft Regulations, see “Regulatory
Overview – Regulations Relating to Internet Information Security and Privacy Protection” in
this prospectus.
SUMMARY
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Our PRC Legal Adviser is of the view that the possibility that our proposed Listing in
Hong Kong may give rise to national security risks and require the application of cybersecurity
review is remote. Based upon such view, our Directors believe, and the Sole Sponsor concurs,
that even if the Draft Regulations are adopted in their current form, it is unlikely that we will
be required to apply for cybersecurity review for our proposed Listing in Hong Kong. The data
processing activities involved in our business operations will be subject to the requirements set
by the Draft Regulations if they become effective. Even if the Draft Regulations are
implemented in their current form, our Directors believe that we will be able to comply with
the requirements in our business operations and they will not have a material adverse impact
on us. For details of our PRC Legal Adviser’s view and our ability to comply with the
requirements under the Draft Regulations without material adverse impact on us, see “Business
– Information System, Data Security and Privacy Protection – Internet Information Security”
in this prospectus.
Cybersecurity Review Measures
According to the amended Cybersecurity Review Measures , which have come into effect
on February 15, 2022, (i) the purchase of cyberspace products and services by the CIIOs and
the network platform operators (the “ Network Platform Operators ”) which engage in data
processing activities that impact or may impact national security shall be subject to
cybersecurity review by the Cybersecurity Review Office; and (ii) the Network Platform
Operators with personal information of more than one million users that seek for listing in a
foreign country are obliged to apply for cybersecurity review by the Cybersecurity Review
Office. For details of the Cybersecurity Review Measures , see “Regulatory Overview –
Regulations Relating to Internet Information Security and Privacy Protection” in this
prospectus.
Our PRC Legal Adviser confirms that neither our business operations nor our proposed
Listing in Hong Kong will trigger the obligation to apply for cybersecurity review by the
Cybersecurity Review Office pursuant to the amended Cybersecurity Review Measures . Our
Directors are of the view that the Cybersecurity Review Measures do not apply to us and will
not have a material adverse impact on us in material aspects, and the Sole Sponsor concurs with
the Directors’ view based on the reasons above. For details of our PRC Legal Adviser’s view
and discussions on the applicability of the Cybersecurity Review Measures to us, see “Business
– Information System, Data Security and Privacy Protection – Internet Information Security”
in this prospectus.
Interim Administrative Measures on Generative AI Services (the “Interim Measures on GAI”)
On July 13, 2023, the CAC and other six ministries jointly published the Interim
Measures on GAI, effective on August 15, 2023. For details of the Interim Measures on GAI,
see “Regulatory Overview – Regulations and Policies on Information Industry – Regulations
on the Application of Artificial Intelligence Technologies” in this prospectus. The Interim
Measures on GAI apply to the provision of generated contents such as texts, images, audios and
videos to the public within the territory of China by utilizing generative AI technologies (“ GAI
SUMMARY
–2 4–


--- page 34 ---
Services ”), to which our business operations may be subject. Since we do not directly or
indirectly provide any AI-based content generating services to individual users, our PRC Legal
Adviser believes that our current businesses fall out of the applicable scope of the Interim
Measures on GAI. However, it essentially remains uncertain as to whether our current
businesses will be deemed by competent authorities to constitute indirectly providing AI-based
content generating services to individual users and thus subject to the Interim Measures on
GAI.
That said, our PRC Legal Adviser is of the view that we would be able to comply with
the Interim Measures on GAI in all material respects assuming its applicability to our current
businesses, considering that: (i) we have adopted internal procedures to ensure that our
operations are in compliance with applicable laws and regulations, including the Interim
Measures on GAI. Specifically, we will strengthen our legal and compliance risk management
by monitoring legal updates and updates on the interpretation of applicable laws and
regulations by relevant regulatory authorities, including that in relation to the Interim Measures
on GAI, and accordingly updating our internal protocols and procedures in a timely manner;
and (ii) moreover, we have also taken contractual and other measures to ensure the legitimacy
of the source of the training data we used. As of the Latest Practicable Date, we (a) had
formulated and implemented our algorithm security management standards and rules, including
the mechanism preventing our AI models from being used to generate illegal or false
information; and (b) were in the process of filing for record for our algorithms with the CAC.
Specifically, under the Administrative Provisions on Deep Synthesis in Internet-based
Information Services , (i) we have to file our algorithm record with the CAC; (ii) as of the
Latest Practicable Date, we had submitted the eligibility certification application, and had
obtained approval from the CAC; and (iii) we then submitted algorithm security self-
assessment report and other materials to the CAC for further review. According to our PRC
Legal Adviser, the entire filing procedure will normally take three to four months based upon
the general practice, based upon which it is expected that such filing will be completed before
September or October 2024. Based on the reasons above, our Directors are of the view that
even if the Interim Measures on GAI did apply to us, it would not have a material adverse
impact on us in material aspects, and the Sole Sponsor concurs with the Directors’ view based
on the reasons above.
For details of the analysis of the Interim Measures on GAI’s applicability to our business,
as well as our ability to comply with the Interim Measures on GAI, see “Business – Information
System, Data Security and Privacy Protection – Generative AI Services” in this prospectus.
Recent Regulatory Update Relating to Overseas Listing
On February 17, 2023, the CSRC promulgated the Trial Administrative Measures of
Overseas Securities Offering and Listing by Domestic Enterprises (ྤʫΆุྤ̮೯БᗇՎ
) (the “ Trial Administrative Measures ”) and relevant supporting
guidelines, which came into effect on March 31, 2023. Pursuant to the Trial Administrative
Measures, PRC domestic enterprises that directly or indirectly offer or list their securities in
an overseas market, which include (i) any PRC enterprise limited by shares; and (ii) any
SUMMARY
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offshore enterprise that conducts its business operations primarily in China and contemplates
to offer or list its securities in an overseas market based on its onshore equities, assets or
similar interests, are required to file with the CSRC within three business days after its
application for overseas listing is submitted. We have timely filed with the CSRC, which was
officially accepted by the CSRC on July 7, 2023. The CSRC confirmed our completion of the
filing on March 8, 2024. As advised by our PRC Legal Adviser, we have completed all
necessary filings with the CSRC for the listing of the H Shares on the Stock Exchange. We are
also proactively following up on changes in laws and regulatory development and will carry
out relevant work to ensure continuous compliance with laws and regulations with the aid of
external counsels, including our PRC Legal Adviser. For details, see “Regulatory Overview –
Regulations on Overseas Listing” in this prospectus.
No Material Adverse Change
Our Directors confirmed that, up to the date of this prospectus, there had been no material
adverse change in our financial or operational prospects since December 31, 2023, being the
latest balance sheet date of our consolidated financial statements in the Accountants’ Report in
Appendix I to this prospectus.
SUMMARY
–2 6–


--- page 36 ---
In this prospectus, the following expressions shall have the meanings set out below
unless the context otherwise requires.
“affiliate(s)” any other person, directly or indirectly, controlling or
controlled by or under direct or indirect common control
with such specified person
“AFRC” the Accounting and Financial Reporting Council
“Application Lists” the application lists for the Hong Kong Public Offering
“Articles” or “Articles of
Association”
our articles of association, as conditionally adopted on
June 16, 2023 and will come into effect upon Listing (as
amended, supplemented or otherwise modified from time
to time), a summary of which is set out in Appendix V to
this prospectus
“associate(s)” has the meaning ascribed thereto under the Listing Rules
“Audit Committee” the audit committee of our Board
“Board” or “Board of Directors” our board of Directors
“Board of Supervisors” our board of Supervisors
“Business Day” a day that is not a Saturday, Sunday or public holiday in
Hong Kong
“CAC” Cyberspace Administration of China ( ʕശɛ͏΍ձ਷਷
܃)
Capital Market Intermediaries”
or “capital market
intermediary(ies)”
the capital market intermediaries participating in the
Global Offering and has the meaning ascribed thereto
under the Listing Rules;
“CCASS” the Central Clearing and Settlement System established
and operated by HKSCC
“Chongqing V oicecomm” Chongqing Shengtong Intelligent Technology Co., Ltd.
(ʮ̡), a limited liability company
established under the laws of PRC, being a wholly-owned
subsidiary of our Company
DEFINITIONS
–2 7–


--- page 37 ---
“China” or “the PRC” the People’s Republic of China excluding, for the
purposes of this prospectus, Hong Kong, the Macau
Special Administrative Region of the People’s Republic
of China and Taiwan
“close associate(s)” has the meaning ascribed thereto under the Listing Rules
“Companies Ordinance” the Companies Ordinance, Chapter 622 of the Laws of
Hong Kong (as amended, supplemented or otherwise
modified from time to time)
“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)
“Company” or “our Company” Shanghai V oicecomm Information Technology Co., Ltd.
(ʮ̡), a joint stock company
incorporated in the PRC with limited liability on May 7,
2015, or, where the context requires (as the case may be),
its predecessor with the same English name (ڦ
ʮ̡), a limited liability company established
in the PRC on December 5, 2005
“Concert Parties” refer to Mr. Tang, Mr. Sun and Jiangfan Technology, and
“Concert Party” means any one of them
“Concert Party Agreement” the concert party agreement dated March 20, 2021
entered into by Mr. Tang, Mr. Sun and Jiangfan
Technology, pursuant to which the parties agreed, inter
alia, that they shall act in concert with respect to, inter
alia, operation and business development related matters
of the Company which are subject to approval in general
meetings or board meetings of the Company since the
date of the agreement and up until they cease to hold any
shares of the Company. For further details, see “History,
Development and Corporate Structure – Concert Party
Arrangement” in this prospectus
“connected person(s)” has the meaning ascribed thereto under the Listing Rules
DEFINITIONS
–2 8–


--- page 38 ---
“Controlling Shareholder(s)” has the meaning ascribed thereto under the Listing Rules
and in the context of this prospectus, refers to the
controlling shareholders of our Company, being the
Concert Parties, Ms. Xu, V oicecomm Rongzhi, Jiageng
Culture, Jiangcheng Asset Management, Mr. Yang and
Mr. Jiang Haisheng (ऎ͛)
“Conversion of Unlisted Shares
into H Shares”
The conversion of 8,625,913 Unlisted Shares in
aggregate held by 30 existing Shareholders into H Shares
upon the completion of Global Offering. The Company
has applied for such conversion of Unlisted Shares into H
Shares with the CSRC on November 16, 2023, which has
been approved by CSRC on March 8, 2024, and an
application has been made to the Listing Committee for
such H Shares to be listed on the Stock Exchange
“core connected person(s)” has the meaning ascribed thereto under the Listing Rules
“CSRC” China Securities Regulatory Commission ( ʕ਷ᗇՎ္ຖ
ึ), a regulatory body responsible for the
supervision and regulation of the PRC national securities
markets
“Director(s)” the director(s) of our Company or any one of them
“Designated Bank” HKSCC Participant’s EIPO Designated Bank
“Extreme Conditions” extreme conditions caused by a super typhoon as
announced by the Government of Hong Kong
“FINI” Fast Interface for New Issuance, a new digital platform
through which IPO market participants and regulators can
manage the end-to-end settlement process for new
listings in Hong Kong
“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
DEFINITIONS
–2 9–


--- page 39 ---
“Group”, “our Group”, “our”,
“we”, or “us”
the Company and all of its subsidiaries, or any one of
them as the context may require or, where the context
refers to any time prior to its incorporation, the business
which its predecessors or the predecessors of its present
subsidiaries, or any one of them as the context may
require, were or was engaged in and which were
subsequently assumed by it
“Guang’an V oicecomm” Guang’an V oicecomm Information Technology Co., Ltd.
(ʮ̡), a limited liability
company established under the laws of PRC, being an
wholly owned subsidiary of our Company
“H Share(s)” overseas listed foreign invested ordinary share(s) in the
ordinary share capital of our Company, with a nominal
value of RMB1.00 each, which are to be subscribed for
and traded in Hong Kong dollars and for which an
application has been made for the granting of listing and
permission to deal in on the Stock Exchange
“H Share Registrar” Computershare Hong Kong Investor Services Limited
“Hainan V oicecomm Intelligent
Technology”
Hainan V oicecomm Intelligent Technology Co., Ltd. ( ऎ
ப΂ʮ̡), a limited liability
company established under the laws of PRC, being an
wholly-owned subsidiary of our Company
“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 HKSCC
Participant to give electronic application instructions via
HKSCC’s FINI system to apply for the Hong Kong Offer
Shares on your behalf
“HKSCC Nominees” HKSCC Nominees Limited, a wholly owned subsidiary
of the HKSCC
DEFINITIONS
–3 0–


--- page 40 ---
“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 Participant” a participant admitted to participate in CCASS as a direct
clearing participant, a general clearing participant or a
custodian participant
“Hong Kong” the Hong Kong Special Administrative Region of the
PRC
“Hong Kong dollars” or “HK
dollars” or “HK$”
Hong Kong dollars and cents respectively, the lawful
currency of Hong Kong
“Hong Kong Offer Shares” the 436,580 H Shares initially being offered by us for
subscription pursuant to the Hong Kong Public Offering,
subject to reallocation as described in the section headed
“Structure of the Global Offering” in this prospectus
“Hong Kong Public Offering” the offer for subscription of the Hong Kong Offer Shares
to the public in Hong Kong (subject to adjustment as
described in the section headed “Structure of the Global
Offering” in this prospectus) at the Offer Price (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%) on the terms and subject to the
conditions described in this prospectus, as further
described in the section headed “Structure of the Global
Offering – The Hong Kong Public Offering”
“Hong Kong Stock Exchange” or
“Stock Exchange”
The Stock Exchange of Hong Kong Limited, a wholly-
owned subsidiary of Hong Kong Exchanges and Clearing
Limited
“Hong Kong Underwriters” the underwriters of the Hong Kong Public Offering as
listed in the paragraph headed “Underwriting – Hong
Kong Underwriters”
DEFINITIONS
–3 1–


--- page 41 ---
“Hong Kong Underwriting
Agreement”
the underwriting agreement dated June 27, 2024 relating
to the Hong Kong Public Offering and entered into
amongst our Company, the Controlling Shareholders,
China International Capital Corporation Hong Kong
Securities Limited and the Hong Kong Underwriters
“IFRS” the International Financial Reporting Standards, which
include standards, amendments and interpretations
promulgated by International Accounting Standards
Board (IASB) and the International Accounting
Standards (IAS) and interpretations issued by the
International Accounting Standards Committee (IASC)
“IIT Law” the Individual Income Tax Law of the PRC ( ʕശɛ͏
)
“Independent Third Party” or
“Independent Third Parties”
a person or entity which, 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
“International Offer Shares” the 3,929,080 H Shares initially being offered by us for
subscription under the International Offering, together,
where relevant, with any additional Shares that may be
allotted and issued pursuant to the exercise of the
Over-allotment Option, and subject to reallocation as
described in the section headed “Structure of the Global
Offering” in this prospectus
“International Offering” the conditional placing by the International Underwriters
of the International Offer Shares at the Offer Price
outside the United States in offshore transactions in
reliance on Regulation S, as further described in the
section headed “Structure of the Global Offering” in this
prospectus
“International Underwriters” the underwriters of the International Offering listed in the
International Underwriting Agreement
DEFINITIONS
–3 2–


--- page 42 ---
“International Underwriting
Agreement”
the underwriting agreement relating to the International
Offering and to be entered into on or around Monday,
July 8, 2024 by, among others, our Company, the Sole
Sponsor, the Sole Overall Coordinator, the Joint Global
Coordinators, Joint Lead Managers, Joint Bookrunners
and the International Underwriters
“iResearch” Shanghai iResearch Co., Ltd., the industry consultant
commissioned by us and an Independent Third Party
“iResearch Report” the independent industry report in respect of the Global
Offering prepared by iResearch
“Jiageng Culture” Shanghai Jiageng Culture Communication Co., Ltd. ( ɪ
ʮ̡), a limited liability company
established under the laws of PRC and is wholly-owned
by Mr. Sun. It is one of our Controlling Shareholders
“Jiangcheng Asset Management” Shanghai Jiangcheng Asset Management Co., Ltd. ( ɪऎ
ʮ̡), a limited liability company
established under the laws of PRC and is held as to 60%
by Mr. Yang and 40% by Mr. Jiang Haisheng (ऎ͛). It
is one of our Controlling Shareholders
“Jiangfan Technology” Shanghai Jiangfan Technology Development Co., Ltd. ( ɪ
ʮ̡), a limited liability company
established under the laws of PRC and is wholly-owned
by Shanghai Jiangcheng Asset Management Co., Ltd. ( ɪ
ʮ̡), which is in turn held as to
60% by Mr. Yang and 40% by Mr. Jiang Haisheng (ऎ
͛). It is one of our Controlling Shareholders
“Jinxun Digital Intelligence” Xian Jinxun Digital Intelligence Information Technology
Co., Ltd. (ʮ̡), a limited
liability company established under the laws of PRC,
being a non-wholly-owned subsidiary of our Company
DEFINITIONS
–3 3–


--- page 43 ---
“Joint Bookrunners” China International Capital Corporation Hong Kong
Securities Limited, China Securities (International)
Brokerage Company Limited, CMBC Securities
Company Limited, Orient Securities (Hong Kong)
Limited, ABCI Capital Limited, CCB International
Capital Limited, China Everbright Securities (HK)
Limited, China Galaxy International Securities(Hong
Kong) Co., Limited, China Merchants Securities (HK)
Co., Limited, CMB International Capital Limited, DBS
Asia Capital Limited, GF Securities (Hong Kong)
Brokerage Limited, ICBC International Securities
Limited, Shenwan Hongyuan Securities (H.K.) Limited
and Zhongtai International Securities Limited
“Joint Global Coordinators” China International Capital Corporation Hong Kong
Securities Limited, China Securities (International)
Brokerage Company Limited, CMBC Securities
Company Limited and Orient Securities (Hong Kong)
Limited
“Joint Lead Managers” China International Capital Corporation Hong Kong
Securities Limited, China Securities (International)
Brokerage Company Limited, CMBC Securities
Company Limited, Orient Securities (Hong Kong)
Limited, ABCI Securities Company Limited, CCB
International Capital Limited, China Everbright
Securities (HK) Limited, China Galaxy International
Securities(Hong Kong) Co., Limited, China Merchants
Securities (HK) Co., Limited, CMB International Capital
Limited, DBS Asia Capital Limited, GF Securities (Hong
Kong) Brokerage Limited, ICBC International Securities
Limited, Shenwan Hongyuan Securities (H.K.) Limited,
Zhongtai International Securities Limited, Fosun
International Securities Limited, Futu Securities
International (Hong Kong) Limited, Guosen Securities
(HK) Capital Company Limited, Livermore Holdings
Limited, Tiger Brokers (HK) Global Limited and
TradeGo Markets Limited
“Latest Practicable Date” June 20, 2024, being the latest practicable date for the
purpose of ascertaining certain information contained in
this prospectus prior to its publication
DEFINITIONS
–3 4–


--- page 44 ---
“LEI” Legal Entity Identifier, a 20-character alpha-numeric
code under the Global LEI System adopted by the
Financial Stability Board to uniquely identify distinct
legal entities which participate in financial transactions
“Listing” listing of the H Shares on the Main Board of the Stock
Exchange
“Listing Committee” the listing committee of the Stock Exchange
“Listing Date” the date, expected to be on or about Wednesday, July 10,
2024, on which the H Shares will be listed and dealings
in the H Shares first commence on the Stock Exchange
“Listing Rules” the Rules Governing the Listing of Securities on The
Stock Exchange of Hong Kong Limited (as amended,
supplemented or otherwise modified from time to time)
“Main Board” the stock market (excluding the option market) operated
by the Hong Kong Stock Exchange which is independent
from and operated in parallel with the Growth Enterprise
Market of the Stock Exchange
“MIIT” Ministry of Industry and Information Technology of the
PRC (ʷ௅) (formerly known
as the Ministry of Information Industry)
“MOF” Ministry of Finance of the PRC (௅)
“MOFCOM” Ministry of Commerce of the PRC ( ʕശɛ͏΍ձ਷ਠਕ
௅)
“Mr. Sun” Mr. Sun Qi (೘), the general manager of our Company,
an executive Director and one of our Controlling
Shareholders
“Mr. Tang” Mr. Tang Jinghua ( ಷหശ), the chairman of the Board, an
executive Director and one of our Controlling
Shareholders
“Mr. Yang” Mr. Yang Xiaoyuan ( เወ๕), a non-executive Director
and one of our Controlling Shareholders
DEFINITIONS
–3 5–


--- page 45 ---
“Ms. Xu” Ms. Xu Xiangfeng (Σቜ), the spouse of Mr. Tang and
one of our Controlling Shareholders
“N Board” Shanghai Equity Exchange Tech Innovative Board ( ɪऎ
ؐan equity trading platform for
technology or innovative companies, which is managed
by the Shanghai Equity Exchange (ʕ
ʮ̡)
“NDRC” the National Development and Reform Commission of
the PRC (ึ)
“NPC” the National People’s Congress of the PRC ( ʕശɛ͏΍
ɽึ)
“Offer Price” the offer price per Offer Share in Hong Kong dollars
(exclusive of brokerage fee of 1.0%, SFC transaction
levy of 0.0027%, AFRC transaction levy of 0.00015%
and Hong Kong Stock Exchange trading fee of
0.00565%) of HK$152.10, at which the Offer Shares are
to be subscribed for and to be determined in the manner
further described in “Structure of the Global Offering –
Pricing of the Global Offering” in this prospectus
“Offer Shares” the Hong Kong Offer Shares and the International Offer
Shares, together with, where relevant, any additional H
Shares which may be issued by our Company pursuant to
the exercise of the Over-allotment Option
“Over-allotment Option” the option to be granted by us to the International
Underwriters exercisable by the Sole Overall Coordinator
on behalf of the International Underwriters under the
International Underwriting Agreement, to require us to
allot and issue up to 654,840 additional H Shares at the
Offer Price, representing up to 15% of the total number of
Offer Shares initially available under the Global Offering
to, among others, cover over-allocations in the
International Offering, if any, further details of which are
described in the section headed “Structure of the Global
Offering – The International Offering – Over-allotment
Option” in this prospectus
DEFINITIONS
–3 6–


--- page 46 ---
“PBOC” People’s Bank of China ( ʕ਷ɛ͏ვБ), the central bank
of the PRC
“PRC Government” the central government of the PRC and all governmental
subdivisions (including provincial, municipal and other
regional or local government entities) and
instrumentalities thereof or, where the context requires,
any of them
“PRC Legal Adviser” Jingtian & Gongcheng, our legal adviser as to PRC laws
“Pre-IPO Investments” the investment(s) in our Company undertaken by the
Pre-IPO Investors pursuant to the respective capital
injection agreement(s) and equity transfer agreement(s),
details of which are set out in the section headed
“History, Development and Corporate Structure” in this
prospectus
“Pre-IPO Investor(s)” the investor(s) who participated in our Pre-IPO
Investments, details of which are set out in the section
headed “History, Development and Corporate Structure”
in this prospectus
“prospectus” this prospectus being issued in connection with the Hong
Kong Public Offering
“Q Board” Tech Innovative Q Board (௴Qؐa display board
managed by the Shanghai Equity Exchange (ᛆৄ
ʮ̡), catering for enterprises which
are in the industries encouraged by the N Board and are
expected to be able to meet the financial performance
requirements for quotation on the N Board. The Tech
Innovative Q Board offers no online trading platform or
trading function
“Regulation S” Regulation S under the U.S. Securities Act
“RMB” or “Renminbi” Renminbi, the lawful currency of the PRC
“SAFE” the State Administration of Foreign Exchange of the PRC
(ʕശɛ͏΍ձ਷̮ි၍ଣ҅)
“SAIC” the State Administration for Industry and Commerce of
the PRC (၍ଣᐼ҅)
DEFINITIONS
–3 7–


--- page 47 ---
“SAT” the State Administration of Taxation of the PRC ( ʕശɛ
೼ਕᐼ҅)
“Securities and Futures
Commission” or “SFC”
the Securities and Futures Commission of Hong Kong
“Securities Law” the Securities Law of the PRC (ج,)
as amended, supplemented or otherwise modified from
time to time
“SFO” the Securities and Futures Ordinance, Chapter 571 of the
Laws of Hong Kong (as amended, supplemented or
otherwise modified from time to time)
“Shandong V oicecomm
Information Technology”
Shandong V oicecomm Information Technology Co., Ltd.
(ʮ̡), a limited liability
company established under the laws of PRC, being an
wholly-owned subsidiary of our Company
“Shandong V oicecomm Intelligent
Technology”
Shandong V oicecomm Intelligent Technology Co., Ltd.
(ʮ̡), a limited liability
company established under the laws of PRC, being an
wholly-owned subsidiary of our Company
“Share(s)” ordinary share(s) in the capital of our Company with a
nominal value of RMB1.00 each, comprising Unlisted
Shares and H Shares
“Shareholder(s)” holder(s) of the Share(s)
“Sichuan V oicecomm Yunji” Sichuan V oicecomm Yunji Information Technology Co.,
Ltd. (ʮ̡), a limited
liability company established under the laws of PRC,
being an wholly-owned subsidiary of our Company
“Sichuan V oicecomm Zhigan” Sichuan V oicecomm Zhigan Technology Co., Ltd. ( ̬ʇ
ʮ̡), a limited liability company
established under the laws of PRC, being an wholly-
owned subsidiary of our Company
“Sichuan V oicecomm Zhishi” Sichuan V oicecomm Zhishi Technology Co., Ltd. ( ̬ʇᑊ
ʮ̡), a limited liability company
established under the laws of PRC, being an wholly-
owned subsidiary of our Company
DEFINITIONS
–3 8–


--- page 48 ---
“Sole Overall Coordinator” China International Capital Corporation Hong Kong
Securities Limited
“Sole Sponsor” China International Capital Corporation Hong Kong
Securities Limited
“Stabilizing Manager” China International Capital Corporation Hong Kong
Securities Limited
“State Council” the State Council of the PRC ( ʕശɛ͏΍ձ਷਷ਕ৫)
“Strategy Committee” the strategy committee of our Board
“subsidiary(ies)” has the meaning ascribed thereto under the Listing Rules
“substantial shareholder(s)” has the meaning ascribed thereto under the Listing Rules
“Supervisor(s)” member(s) of our Board of Supervisors
“Takeovers Code” the Code on Takeovers and Mergers and Share Buy-
backs, as published by the SFC (as amended,
supplemented or otherwise modified from time to time)
“Track Record Period” the three years ended December 31, 2021, 2022 and 2023
“Underwriters” the Hong Kong Underwriters and the International
Underwriters
“Underwriting Agreements” the Hong Kong Underwriting Agreement and the
International Underwriting Agreement
“United States” or “U.S.” the United States of America, its territories, its
possessions and all areas subject to its jurisdiction
“Unlisted Shares” ordinary share(s) issued by our Company, with a nominal
value of RMB1.00 each, which is/are not listed on any
stock exchange
“U.S. dollars”, “US$” or “USD” United States dollars, the lawful currency of the United
States
“U.S. Securities Act” the U.S. Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder
DEFINITIONS
–3 9–


--- page 49 ---
“V AT” value-added tax
“V AT License” value-added telecommunication services operating
license
“V oicecomm Gengyou” Sichuan V oicecomm Gengyou Auto Parts Intelligent
Manufacturing Co., Ltd. (Ԡӛԓཧ௅΁౽ঐ
ʮ̡), a limited liability company established
under the laws of PRC, being an wholly-owned
subsidiary of our Company
“V oicecomm (Hong Kong)” V oicecomm Limited (ʮ̡), a
limited liability company incorporated in Hong Kong,
being an wholly-owned subsidiary of our Company
“V oicecomm Jiachen” Sichuan V oicecomm Jiachen Information Technology
Co., Ltd. (ʮ̡), a limited
liability company established under the laws of PRC,
being an wholly-owned subsidiary of our Company
“V oicecomm Rongzhi” Shanghai V oicecomm Rongzhi Technology Group Co.,
Ltd. (ʮ̡), formerly known
as Shanghai Fengjing Information Consultation Co., Ltd.
(ʮ̡), a limited liability
company established under the laws of PRC and is owned
as to 99.0% and 1.0% by Mr. Tang and Ms. Xu,
respectively. It is one of our Controlling Shareholders
“V oicecomm Xuanwu” Sichuan V oicecomm Xuanwu Information Technology
Co., Ltd. (ʮ̡), a limited
liability company established under the laws of PRC,
being a wholly-owned subsidiary of our Company
“V oicecomm Yilian” V oicecomm Yilian (Shanghai) Software Technology Co.,
Ltd. ( ᑊஷɓ⥴(ɪऎ)ʮ̡), a limited
liability company established under the laws of PRC,
being a non wholly-owned subsidiary of our Company
“V oicecomm Yunxiu” Sichuan V oicecomm Yunxiu Information Technology Co.,
Ltd. (ʮ̡), a limited
liability company established under the laws of PRC,
being an wholly-owned subsidiary of our Company
DEFINITIONS
–4 0–


--- page 50 ---
“White Form eIPO ” the application for Hong Kong Offer Shares to be issued
in the applicant’s own name by submitting applications
online through the designated website of White Form
eIPO Service Provider at www.eipo.com.hk
“White Form eIPO Service
Provider”
Computershare Hong Kong Investor Services Limited
“Yuanya Information” Shanghai Yuanya Information Technology Co., Ltd. ( ɪऎ
ʮ̡), a limited liability company
established under the laws of PRC, being a non-wholly-
owned subsidiary of our Company
“%” per cent
For ease of reference, the names of the PRC established companies or entities, laws or
regulations have been included in this prospectus in both the Chinese and English languages;
in the event of any inconsistency, the Chinese versions shall prevail.
For the purpose of this prospectus, references to “provinces” of China include provinces,
municipalities under direct administration of the central government and provincial-level
autonomous regions
DEFINITIONS
–4 1–


--- page 51 ---
“5G” the 5th generation mobile network, a new global wireless
standard after 1G, 2G, 3G, and 4G networks
“AI” artificial intelligence, simulation of human intelligence
by machines
“AI empowerment computing
center”
a computing center with AI supercomputing
infrastructure and a large number of GPUs, to offer
pre-trained AI models and produce new AI models
“AI model” mathematical algorithms which can take unstructured
data as input and transform them into informative outputs
through its “intelligence”, namely, the capability of
perceiving the world, transcribing and organizing
information, enhancing or generating contents, or making
decisions
“algorithm” a procedure or formula for solving a problem, based on
conducting a sequence of specific actions, especially by a
computer
“API” application programming interface, a computer
programming approach for facilitating exchange of
information and executing instructions between different
computer systems
“app” or “application” application software designed to run on smartphones and
other mobile devices
“architecture” the structure under which an information system’s
hardware, software, data and communication capabilities
are put together
“automatic speech recognition”
or “ASR”
a technology that uses machine-learning algorithms to
convert spoken language to computer-processable inputs,
such as keystrokes, binary codes or character sequences
“CAGR” compound annual growth rate, representing the year-
over-year growth rate of a value over a specified period
of time taking into account the effects of compounding
and calculated by subtracting one from the result of
dividing the ending value by its beginning value raised to
the power of one divided by the period length
GLOSSARY OF TECHNICAL TERMS
–4 2–


--- page 52 ---
“carbon neutrality” net zero carbon emissions, achieved through a transparent
process of measuring emissions, reducing those
emissions and offsetting residual emissions
“city-level autonomous driving” autonomous driving that enables city-wide scheduling of
vehicles, including city-wide coverage and compatibility
with various vehicle types within the city
“cloud” a network of remote servers hosted on the
internet/intranet and used to store, manage, and process
data in place of local servers or personal computers
“cloud-based” applications, services or resources made available to
users on demand via the internet from a cloud computing
provider’s servers with access to shared pools of
configurable resources
“cloud computing” the practice of storing computer data and programs on
multiple servers that can be accessed through the internet
“computer telecommunications
integration” or “CTI”
a set of technologies for integrating and managing
computers and telecommunications systems
“computer vision AI” a field of AI that enables cameras and computers to
identify, track and measure images and videos in lieu of
human eyes, through which it allows extraction of
valuable information and data, and performance of tasks
such as analyses and automation
“computing power” the ability of a computer to perform an operation
“core conversational AI
technologies”
conversational AI technologies necessary for realizing
speech-based interactions between human beings and
machines, such as automatic speech recognition, emotion
recognition, natural language processing, natural
language generation and text to speech
“COVID-19” coronavirus disease 2019, a disease caused by a novel
virus designated as severe acute respiratory syndrome
coronavirus 2
“CSTA” computer-supported telecommunications applications, a
protocol interface which enables the smart connection of
computers and phone systems
GLOSSARY OF TECHNICAL TERMS
–4 3–


--- page 53 ---
“customer relationship
management” or “CRM”
a strategy for managing an organization’s relationships
and interactions with customers and potential customers,
including automatic analysis of sales and marketing
strategies, and customer services, as well as
implementations procedures
“deep learning” a subset of AI and machine learning that mimics the
working of biological neural systems such as human
brains and uses multi-layered neural networks to deliver
state-of-the-art accuracy in tasks such as object detection
and recognition, speech recognition and natural language
processing. Deep learning differs from traditional
machine learning techniques in that it can automatically
learn representations from data such as images, video or
text, without introducing hand-coded rules or human
domain knowledge. Its highly flexible architecture can
learn directly from raw data and can increase its
predictive accuracy when provided with some data
“digital human” a human-like digital avatar that interacts with users
naturally and vividly through dialogues, expressions and
gestures
“eco-partners” participants within the AI industrial value chain featured
by increasing technology fusion for serving specific
scenarios that can not only form reciprocal
supplier-customer relationships between themselves, but
also collaboratively develop technologies and expand
market penetration by leveraging their respective
strengths and/or resources in technology, service and/or
commercialization, etc.
“emotion recognition” the attribution of emotion states based on the observation
of visual and auditory nonverbal cues
“end-customer industry(ies)” an industry-based classification of our direct customers,
i.e., the industry (i) that a system integrator primarily
serves; or (ii) in which an enterprise-level user operates
“end users” enterprise-level users that have used or may potentially
use our solutions offered through system integrators as
our customers
GLOSSARY OF TECHNICAL TERMS
–4 4–


--- page 54 ---
“enterprise-level users” organizations (including corporations and government
entities) that have used or may potentially use
conversational AI solutions
“enterprise resource planning” a business process management software that allows an
organization to use a system of integrated applications to
manage the business and digitalize back-office functions
relating to technologies, services, and human resources
“ETC” a wireless system to automatically collect the usage fee
or toll charged to vehicles using toll roads, high-
occupancy vehicle lanes, toll bridges and toll tunnels
“federated learning” a decentralized approach to training machine learning
models where the raw data on edge devices are used to
train models locally without an exchange of data to
global servers
“few-shot learning” the practice of feeding a learning model with a very small
amount of training data, in contrast to the practice of
using a large amount of data
“gateway” a computer system that conducts the conversion between
two systems with different communication protocols,
data formats or languages, or even completely different
architectures
“GDP” Gross Domestic Product
“GPU” graphics processing unit, a specialized electronic circuit
designed to rapidly manipulate and alter memory to
accelerate the creation of images
“Hz” hertz, a measurement of frequency
“IDC” internet data centers, physical facilities that house data
servers and other IT infrastructure
“image recognition” a technology that uses computers to process, analyze and
understand images in order to recognize targets in a
variety of different patterns
GLOSSARY OF TECHNICAL TERMS
–4 5–


--- page 55 ---
“intelligent connective vehicle”
or “ICV”
an emerging product accelerating cross-border
integration and transformation in information and
communication, the internet, big data, AI, and road
transportation industries
“interactive voice response” or
“IVR”
an automated voice system technology to provide or
gather information from incoming callers via a voice
response system, with pre-recorded or synthesized speech
generated from text-to-speech technology, without
having to speak to a human agent
“internet of vehicles” or “IoV” a network of vehicles equipped with sensors, software,
and the technologies that mediate between these with the
aim of connecting and exchanging data over the Internet
according to agreed standards
“IoT” internet of things, the extension of internet connectivity
into physical devices and everyday objects
“IP” Internet Protocol, a set of rules for communication over
the internet, with an IP address identifying a network or
device on the internet
“ISCSLP” International Symposium on Chinese Spoken Language
Processing, a biennial conference for scientists,
researchers, and practitioners to report and discuss the
latest progress in all theoretical and technological aspects
of spoken language processing. ISCSLP is the flagship
conference of the Special Interest Group on Chinese
Spoken Language Processing (SIG-CSLP)
“ISO” International Organization for Standardization, an
international standard-setting body composed of
representatives from various national standards
organizations
“IT” information technology
“knowledge base” a centralized repository of information designed to store
complex structured data and capture the knowledge of
human experts to support decision-making
GLOSSARY OF TECHNICAL TERMS
–4 6–


--- page 56 ---
“knowledge graphs” a series of different graphics showing the process of
knowledge development and structural relationships,
describing subjects or concepts using visualization
techniques, and containing multiple abilities to mine,
analyze, construct, map and display knowledge and their
interconnections
“large language model” or
“LLM”
without formal definition and normally referring to a
language model trained on large quantities of text data
with billion-level or above parameters for general
purposes, as opposed to models trained for accomplishing
specific tasks
“low-code” characteristics of a development environment used to
create application software through a graphical user
interface
“machine learning” the scientific study of algorithms and statistical models
that computer systems use to effectively perform specific
tasks without being explicitly programmed to do so
“natural language processing”
or “NLP”
a subfield of linguistics, computer science and AI
primarily consisted of natural language understanding
(NLU) and natural language generation (NLG) and
concerned with the interactions between computers and
human language, in particular how to program computers
to process and analyze large amounts of natural language
data
“office automation system” also known as OA system, a system that enables to create,
collect, store, manipulate and relay office information in
a data storage system
“on-board unit” a device installed in a vehicle for recording data for the
vehicle and communication with specific devices
installed in the ETC toll lanes by way of microwave
signals. The on-board unit must be used in conjunction
with the ETC card to allow non-stop drive through on the
ETC lanes
“open-source” a source code that is made freely available for possible
modification and redistribution
GLOSSARY OF TECHNICAL TERMS
–4 7–


--- page 57 ---
“PC” personal computer, a multi-purpose computer whose size,
capabilities, and price make it feasible for individual use
“power usage effectiveness” or
“PUE”
a metric used to determine the energy efficiency of a
facility and is determined by dividing the total amount of
power entering the facility by the power used to run the
IT equipment within it
“public switched telephone
network”
also known as PSTN, a generic term for a fixed network
to which a cellular network is interconnected in order to
be able to send and receive calls to and from fixed
network subscribers
“R&D” research and development
“reinforcement learning” an area of machine learning concerned with how
intelligent agents ought to take actions in an environment
in order to maximize the notion of cumulative reward
“return on investment” financial ratios used to calculate the benefit an investor
will receive in relation to their investment cost
“roadside unit” a special wireless communicating device located on the
roadside that provides connectivity and information
support to passing vehicles, including safety warnings
and traffic information
“self-supervised learning” a machine learning paradigm and corresponding methods,
for processing unlabeled data and completing pretext
tasks to obtain useful representations that can help with
downstream learning tasks
“sensor” a device, module, machine, or subsystem whose purpose
is to detect events or changes in its environment and send
the information to other electronics, frequently a
computer processor
“SIP” Session Initiation Protocol, a signaling protocol used for
initiating, maintaining, and terminating communication
sessions that include voice, video and messaging
applications
GLOSSARY OF TECHNICAL TERMS
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--- page 58 ---
“SMS” short message service, a basic communication technology
for mobile data transfer and is characterized by the
exchange of short alphanumeric text messages between
digital line and mobile devices
“softswitch” also known as software switch, a call-switching node in
a telecommunications network based in software instead
of specialized switching hardware. It separates the call-
control functions of a telephone call from the media
gateways that carry it. It is the core communication
component in a communication platform, which
processes all calls taking place on the platform and
performs key functions such as communication protocol
processing, communication routing processing, and
codec (coder/decoder) processing
“software development kits” a set of tools used for developing applications provided
by hardware and software providers
“TAPI” telephony application programming interface, a set of
standard application programming interfaces for
connecting a computer to telephone services
“T-box” also known as telematics box, an electronic device fitted
to a vehicle to record and monitor the vehicle’s
performance
“text to speech” or “TTS” a type of speech synthesis application that converts text
into natural speech output
“time interval between failures” the elapsed time between inherent failures of a
mechanical or electronic system, during normal system
operation
“total cost of ownership” the purchase price of an asset plus the costs of operation
“transfer learning” a research field in machine learning that focuses on
storing knowledge gained while solving one problem and
applying it to a different but related problem
“TSAPI” telephony server application programming interface, a
computer telecommunications integration standard that
enables telephony and CTI application programming
GLOSSARY OF TECHNICAL TERMS
–4 9–


--- page 59 ---
“vehicle-to-everything” or “V2X” communication between a vehicle and any object, such as
road, traffic lights and roadside signals that may affect, or
may be affected by, the vehicle
“video gateway” a gateway that integrates core functions such as
streaming protocol conversion, streaming distribution
services, multi-channel video decoding, and video screen
segmentation
“virtual reality” the computer-generated simulation of a three-
dimensional image or environment that can be interacted
with in a seemingly real or physical way by a person
using special electronic equipment, such as a helmet with
a screen inside or gloves fitted with sensors
“voiceprint recognition” a technology that identifies the speaker through acoustic
features
“V oIP” V oice over Internet Protocol, the category of hardware
and software that enables people to make telephone calls
via the Internet or IP networks, including phone to phone,
phone to PC, PC to phone but excluding PC to PC
communications and private network traffic. V oice
signals are converted to packets of data, which are
transmitted on shared public lines, hence avoiding the
tolls of the traditional public switched telephone network
GLOSSARY OF TECHNICAL TERMS
–5 0–


--- page 60 ---
This prospectus contains certain forward-looking statements relating to our plans,
objectives, beliefs, expectations, predictions and intentions, which are not historical facts and
may not represent our overall performance for the periods of time to which such statements
relate. Such statements reflect the current views of our management with respect to future
events, operations, liquidity and capital resources, some of which may not materialize or may
change. These statements are subject to certain risks, uncertainties and assumptions, including
the other risk factors as described in this prospectus. You are strongly cautioned that reliance
on any forward-looking statements involves known and unknown risks and uncertainties. The
risks, uncertainties and other factors facing the Company which could affect the accuracy of
forward-looking statements include, but are not limited to, the following:
 our business strategies and plans to achieve these strategies;
 our future debt levels and capital needs;
 changes to the political and regulatory environment in the industry and markets in
which we operate;
 our expectations with respect to our ability to acquire and maintain regulatory
licenses or permits;
 changes in competitive conditions and our ability to compete under these conditions;
 future developments, trends and conditions in the industry and markets in which we
operate;
 general economic, political and business conditions in the markets in which we
operate;
 effects of the global financial markets and economic crisis;
 our financial conditions and performance;
 our dividend policy; and
 change or volatility in interest rates, foreign exchange rates, equity prices, volumes,
operations, margins, risk management and overall market trends.
Additional factors that could cause actual performance or achievement to differ materially
including but not limited to those discussed in “Risk Factors” and elsewhere in this prospectus.
In some cases, we use the words “aim,” “anticipate,” “believe,” “can,” “continue,” “could,”
“estimate,” “expect,” “going forward,” “intend,” “ought to,” “may,” “might,” “plan,”
“potential,” “predict,” “project,” “seek,” “should,” “will,” “would” and similar expressions to
identify forward-looking statements. In particular, we use these forward-looking statements in
FORW ARD-LOOKING STATEMENTS
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the “Business” and “Financial Information” sections of this prospectus in relation to future
events, our future financial, business or other performance and development, the future
development of our industry and the future development of the general economy of our key
markets.
We caution you not to place undue reliance on these forward-looking statements which
are based on current plans and estimates, and speak only as of the date they were made. We
undertake no obligation to update or revise any forward-looking statements in light of new
information, future events or otherwise. Forward-looking statements involve inherent risks and
uncertainties and are subject to assumptions, some of which are beyond our control. We caution
you that a number of important factors could cause actual outcomes to differ, or to differ
materially, from those expressed in any forward-looking statements.
Our Directors confirm that the forward-looking statements are made after reasonable care
and due consideration. Nonetheless, due to the risks, uncertainties and assumptions, the
forward-looking events and circumstances discussed in this prospectus might not occur in the
way we expect, or at all. Statements of or references to our intentions or those of any of our
Directors are made as of the date of this prospectus. Any such intentions may change in light
of future developments.
Accordingly, you should not place undue reliance on any forward-looking statements in
this prospectus. All forward-looking statements contained in this prospectus are qualified by
reference to this cautionary statement.
FORW ARD-LOOKING STATEMENTS
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An investment in our H Shares involves significant risks. You should carefully
consider all of the information in this prospectus, including the risks and uncertainties
described below, as well as our financial statements and the related notes, and the
“Financial Information” section, before deciding to invest in our H Shares. The following
is a description of what we consider to be our material risks. Any of the following risks
could have a material adverse effect on our business, financial condition, results of
operations and growth prospects. In any such an event, the market price of our H Shares
could decline, and you may lose all or part of your investment. Additional risks and
uncertainties not presently known to us or that we currently deem immaterial also may
impair our business operations.
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.
We believe there are certain risks and uncertainties involved in our operations, some of
which are beyond our control. We have categorized these risks and uncertainties into: (i) key
risks relating to our business, industry, regulatory compliance, general operations and financial
prospects; (ii) risks relating to our business; (iii) risks relating to our industry; (iv) risks
relating to regulatory compliance; (v) risks relating to our financial position and need for
additional capital; (vi) risks relating to our general operations; and (vii) risks relating to the
Global Offering. Additional risks and uncertainties that are presently not known to us or that
we currently deem immaterial could also have a material adverse effect on our business,
financial condition and results of operations. You should consider our business and prospects
in light of the challenges we face, including the ones discussed in this section.
KEY RISKS RELATING TO OUR BUSINESS, INDUSTRY, REGULATORY
COMPLIANCE, GENERAL OPERATIONS AND FINANCIAL PROSPECTS
We are subject to credit risk related to defaults of customers as our trade receivables
balance and trade receivables turnover days increased significantly during the Track
Record Period, and any significant delay in payment or default on our trade receivables
could materially and adversely affect our liquidity, working capital, financial condition
and results of operations.
We are exposed to credit risk related to delays in payments and defaults of our customers.
As of December 31, 2021, 2022 and 2023, our trade and other receivables amounted to
RMB242.8 million, RMB339.7 million and RMB602.7 million, respectively, in which our trade
receivables amounted to RMB248.1 million, RMB379.1 million and RMB704.7 million,
respectively, with loss allowance thereon amounting to RMB32.4 million, RMB66.5 million
and RMB121.9 million, respectively. Moreover, our trade receivables turnover days increased
significantly during the Track Record Period, from 137 days in 2021 to 222 days in 2022, and
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further to 243 days in 2023. Such increase was primarily due to the fact that COVID-19 had
extended the period over which we used to collect our trade receivables, especially in 2022.
Also, the macro-economic conditions and weakened financial conditions of our
customers/enterprise-level users affected by COVID-19 further temporarily prevented them
from making payment timely to us even in the aftermath of the pandemic. Moreover, our
solutions had been increasingly offered via large-scale projects to end customers from the
public sector that features solid credit status yet a long payment cycle with respect to such
projects because of their internal financial management and payment approval processes.
We may not be able to timely collect all such trade receivables due to a variety of factors
that are beyond our control, including the long payment cycle associated with end users from
the public sector because of their internal financial management and payment approval
processes. Our exposure to such trade receivables recoverability issue would especially be
more pronounced if the financial condition of enterprises or entities from the public sector, to
whom our solutions were substantially offered during the Track Record Period, would
deteriorate in the case of a combination of factors such as local governments’ significant debt
obligations and diminished tax and other revenues, as well as uncertain availability of
financing vehicles therefor.
If any of our customers experience financial difficulties in settling our trade receivables,
or if the relationship between us and any of our customers is terminated or deteriorates, our
corresponding trade receivables might be adversely affected in terms of recoverability. As the
increase of the amount of provisions made on our trade receivables are recorded as expenses
on our consolidated statements of profit or loss, if we are not able to manage the credit risk
associated with our trade receivables effectively, our financial condition and results of
operations may be materially and adversely affected. Furthermore, substantial defaults or
delays by our customers for making payments could materially and adversely affect our cash
flow and we may have to terminate our relationships with such customers. In the worst-case
scenario if the abovementioned microeconomic factors would ever and indeed materialize, a
double squeeze of much higher write-off of trade receivables and slower cash inflows could
quickly and significantly strain our working capital in the short term, which might bring
various challenges to our business operations, including: (i) sizeable cash flow gaps that might
necessitate expensive bridge financing; (ii) cost overruns on existing projects and inability to
fund upfront costs of implementing new projects; (iii) workforce shrinkage impacting our
service capabilities; (iv) defaults in debt repayments and inability to obtain new borrowings;
and (v) loss of credibility with customers, suppliers, lenders and other partners in a vicious
cycle that would ultimately threaten our solvency. In addition, we had net loss for the year 2022
and 2023 and net cash flows used in operating activities during the Track Record Period.
Significant amount of trade receivables may make us continue to have net losses and net cash
outflows from operating activities in the future. For details, see “– Risks Relating to Our
Financial Position and Need for Additional Capital – We had net loss for the year 2022 and
2023 and net cash flows used in operating activities during the Track Record Period, and may
need to obtain additional financing to fund our operations, which may cause dilution to our
Shareholders and restrict our operations, and we may not be able to obtain additional financing
on favorable terms or at all” in this section.
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As our business is subject to complex and evolving laws, regulations and governmental
policies regarding cybersecurity, privacy and data protection and generative AI services,
actual or alleged failure to comply with applicable laws, regulations and governmental
policies could damage our reputation, deter current and potential customers or end users
from using our solutions, and subject us to significant legal, financial and operational
consequences.
In recent years, privacy and data protection has become an increasing regulatory focus of
government authorities across the world. The PRC government has enacted a series of laws,
regulations and governmental policies on privacy and data protection in the past few years, to
which our business may be subject. For example, on June 10, 2021, the Standing Committee
of the National People’s Congress (the “ SCNPC ”) promulgated the PRC Data Security Law
(), which came into effect on September 1, 2021. The PRC
Data Security Law stipulates data security obligations on entities and individuals carrying out
data processing activities, introduces a data classification and hierarchical protection system
based on the importance of data in economic and social development, and the degree of harm
it will cause to national security, public interests or legitimate rights and interests of
individuals or organizations when such data are tampered with, destroyed, leaked, or illegally
acquired or used, and provides for a national security review procedure for those data
processing activities which may affect national security as well as regulates the export of
certain data and information. On August 20, 2021, the SCNPC issued the PRC Personal
Information Protection Law (), coming into effect on
November 1, 2021, which reiterates the circumstances under which a personal information
processor could process personal information and the requirements thereunder. The PRC
Personal Information Protection Law clarifies the scope of application, the definition of
personal information and sensitive personal information, the legal basis of personal
information processing and the basic requirements of notice and consent.
As the regulatory requirements on privacy and data protection are relatively new and
complex, and may therefore continue to evolve, we cannot assure you that our privacy and data
protection measures are, and will be, always considered sufficient under applicable laws and
regulations. Additionally, the effectiveness of our privacy and data protection measures is also
subject to system failures, interruptions, inadequacy, security breaches or cyberattacks. In
addition, as the enterprises that we serve expand their footprints globally, they may leverage
our solutions in other countries or territories outside the PRC, which may thus subject us to
laws and regulations regarding privacy and data protection in such jurisdictions. Any failure or
perceived failure by us to comply with applicable laws and regulations on privacy and data
protection may result in governmental investigations, inquiries, enforcement actions and
prosecutions, private claims and litigation, fines and penalties, adverse publicity or potential
loss of business, which could damage our reputation, deter current and potential customers or
end users from using our solutions and subject us to significant legal, financial and operational
consequences.
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On November 14, 2021, the CAC released the Network Data Security Management
Regulations (Draft for Comment) (the “ Draft Regulations ”) ( ၣഖᅰኽτΌ၍ଣૢԷ(ᅄӋ
จԈᇃ)). The Draft Regulations stipulate several requirements for entities who process data
through the use of networks, including that data processors shall (i) be responsible for the
security of the data it processed and shall undertake data protection obligations; and
(ii) establish comprehensive data protection system and technical protection mechanism. As of
the Latest Practicable Date, the Draft Regulations had only been released for consultation
purposes, and some of the requirements under the Draft Regulations were subject to more
specific implementing rules, so its final content, anticipated adoption or effective date, final
interpretation and implementation, and other aspects may continue to evolve. As such, we
cannot predict the impact of these draft measures, if any, at this stage, and will closely monitor
and assess any development in the rule-making process. On December 28, 2021, the CAC and
12 other relevant PRC government authorities published the amended Cybersecurity Review
Measures (), which became effective on February 15, 2022, and
superseded and replaced the Cybersecurity Review Measures previously promulgated on
April 13, 2020. The Cybersecurity Review Measures provide that cybersecurity review shall be
conducted with respect to (i) critical information infrastructure operators purchasing network
products and services; and (ii) internet platform operators carrying out data processing
activities in a manner which affects or may affect national security. In addition, the
relevant governmental authorities may initiate cybersecurity review if they determine certain
network products, services, or data processing activities affect or may affect national security.
There can be no assurance that we will not be required to follow the cybersecurity review
procedures, and if so, whether we would be able to complete the applicable cybersecurity
review procedures in a timely manner, or at all.
In addition, some provisions under certain laws and regulations still remain at the
principle level and lack specific interpretation up to date, especially to a specific case scenario.
Nevertheless, failure to comply with the cybersecurity requirements in a timely manner, or at
all, may result in reputational damages and subject us to government enforcement actions and
investigations, fines, penalties, suspension of our non-compliant operations, and revocation of
relevant business permits or licenses, among other sanctions, which could materially and
adversely affect our business and results of operations.
These and other similar legal and regulatory developments could lead to legal and
economic uncertainties, affect how we design our solutions, how we operate our business, as
well as how we process data, which could negatively impact demand for our solutions. For
example, on July 10, 2023, the CAC and other six ministries jointly published the Interim
Administrative Measures on Generative AI Services (the “ Interim Measures on GAI ”) ( ͛
), effective on August 15, 2023, which apply to the
provision of generated contents such as texts, images, audios and videos to the public within
the territory of China by utilizing generative AI technologies (“ GAI Services ”). The Interim
Measures on GAI, among other things, (i) set forth principles for provision and use of GAI
Services; (ii) impose various obligations for the provider of GAI Services, from protection of
users’ personal information to content monitoring and filtering; (iii) provide specific
requirements for the data training activities such as pre-training and fine-tuning; and (iv)
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require the providers of GAI Services to conduct security assessment for provision of GAI
Services with public opinion attributes or social mobilization capabilities and file for records
with the CAC. On the basis that our solutions are only provided to institution users, our PRC
Legal Adviser is of the view that our current businesses do not fall into the scope of provision
of GAI Services to the public and thus the Interim Measures on GAI do not apply to our current
businesses. For details, see “Summary – Recent Development – Regulatory Update – Recent
Regulatory Update Relating to Data Privacy, Cybersecurity and Generative AI Services –
Interim Administrative Measures on Generative AI Services (the ‘Interim Measures on GAI’)”
in this prospectus. Nevertheless, there can be no assurance that the relevant authorities will not
subject our business operations to the ambit of the Interim Measures on GAI, and require us
to apply for security assessment or complete the filing, change or deregistration formalities of
algorithms, among others.
We expect that there may continue to be newly proposed laws, rules, regulations and
industry standards concerning cybersecurity, privacy and data protection and GAI Services. As
a result, we may be required to upgrade or adjust our solutions to ensure continuous
compliance. However, the relevant developments in regulatory requirements and standards may
increase our costs of compliance, delay or reduce demand for our solutions, and affect the way
in which we operate, any of which could harm our business, financial condition and results of
operations.
As the industry in which we operate is highly competitive, our results of operations could
be harmed if we do not effectively compete against our current or future competitor,
which may particularly include major technology giants and cloud service companies.
The industry in which we operate is relatively new, rapidly evolving and highly
competitive. We face competitions in various aspects of our business, including, among others,
the comprehensiveness and adaptability of solutions, brand recognition, ability to continuously
innovate solutions, and expertise based upon different end-customer industries in developing
industry-specific solutions. We face competitions from other companies that have transitioned
from communication technology services to AI research and development and thus have
full-stack service capabilities, traditional communication technology service companies,
intelligent speech and semantic companies, and general AI companies. Moreover, technology
giants or cloud service companies with extensive technological accumulations, substantial
resources and greater brand power could swiftly enter into or further expand in the industry in
which we operate to compete with us. For details, see “Industry Overview – Market of IT
Solutions Empowered by Conversational AI & UC in China – Market of Full-Stack
Enterprise-Level IT Solutions Empowered by Conversational AI & UC in China – Competitive
Landscape” in this prospectus. Some of our competitors can devote significantly greater
resources than we can to the development, promotion and sales of their products, services
and/or solutions, and have the ability to initiate or withstand substantial price competition. Our
competitors may also have longer corporate operating history, or have or in the future gain
more financial resources and sophisticated technological capabilities, as well as broader
customer base and relationships than us. Furthermore, our current or potential competitors may
be acquired by third parties with significantly greater resources and therefore gain competitive
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advantages. Additionally, our competitors may also establish cooperative relationships among
themselves or with third parties that may further enhance their product offerings or resources
and ability to compete. Last but not least, as we expand into new technological areas and
end-customer industries, the basis for competition will be different and we are likely to face
additional competitors. By contrast, our competitors may be able to respond more quickly and
effectively to new or changing opportunities, technologies, regulatory requirements or user
demand than us.
With the introduction of new technologies and entry of new market participants who may
offer lower prices or new technologies and products, we expect the competitions to continue
to intensify in the future. If we fail to predict the right combination of market and technologies
and our competitors’ products, services and/or solutions become more accepted than ours, if
they are successful in bringing their products, services and/or solutions to market earlier than
ours, or if their products, services and/or solutions are less expensive or more technologically
capable than ours, our competitive position could be harmed, which may result in lower sales,
price reductions and reduced margins. Further, we may be compelled to make substantial
additional investments in research and development, marketing and sales, recruiting and
retaining innovative talents, and acquiring technologies complementary to, or necessary for,
our current and future solutions in order to respond to such competitive threats, and we cannot
assure you that such endeavors will be successful. If we are unable to differentiate ourselves
in the intense competitions, or if competing successfully requires us to take costly actions in
response to the actions of our competitors, we may not be able to retain existing customers or
attract new customers, which will materially and adversely affect our results of operations.
If we fail to continuously develop and innovate our solutions to meet enterprise-level
users’ evolving needs, our business, financial condition and results of operations may be
materially and adversely affected.
Our business growth relies on our ability to retain existing customers, attract new
customers, and increase sales to both new and existing customers, which depends essentially
on our ability to provide advanced solutions that meet enterprise-level users’ evolving needs
at competitive prices and our continuous improvement and enhancement of the functionality,
performance, reliability, design, security and adaptability of our solutions. However, we may
experience difficulties in developing new technologies as it is costly and time-consuming,
which in turn could delay or prevent the development, enhancement, introduction or
implementation of any new solutions. Specifically, in order to enhance the performance of our
solutions and improve our AI technological capabilities in the future, we may need to expand
our computing power from time to time as we grow, and may therefore be in need of additional
sites, infrastructure, facilities and equipment to support such computing power expansion
through capital expenditures or procurement of third-party services. However, we may not
always be able to identify such sites, infrastructure, facilities or equipment at acceptable prices
and in a timely manner, or at all. If we are unable to do so, our computing power expansion
plans could suffer, which would negatively impact our business operations and prospects. Even
if we are able to identify such sites, infrastructure, facilities and equipment, it may put a strain
on our financial resources and divert the attention of our management. As we have been and
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will continue expanding our customer base and diversifying end-customer industries that we
cover, to the extent we are not able to provide solutions that meet users’ requirements, or we
are not able to improve and enhance the functionality, performance, reliability, design, security
and adaptability of our solutions in a manner that responds to users’ evolving needs, our
existing customers may not spend more on our solutions and we may not be able to attract new
customers. As a result, our business, financial condition and results of operations may be
materially and adversely affected.
Any flaws or misuse of conversational AI technologies, whether actual or perceived,
intended or inadvertent, committed by us or third parties, could have a material adverse
effect on our reputation, business, financial condition, results of operations and prospects.
Conversational AI technologies are still at preliminary stages of development and will
continue to evolve. Flaws or deficiencies in conversational AI technologies could undermine
the accuracy and thoroughness of the decisions and analyses made by the relevant products,
services or solutions. There can be no assurance that we will be able to detect and remedy such
flaws or deficiencies with our conversational AI technologies in a timely manner, or at all. Any
flaws or deficiencies in our conversational AI technologies, whether actual or perceived, could
result in competitive disadvantages, potential legal liabilities, and reputational damages.
Moreover, insufficient, low-quality or inaccurate data could materially affect the performance
of our solutions. The information available to us, our customers or end users may be limited,
and we cannot ensure the accuracy and timeliness of the various sources of data used for
various reasons. In such events, our solutions may not be able to generate satisfactory results.
Consequently, there may be negative conceptions about our solutions, which could adversely
affect our business and reputation.
Similar to many innovations, conversational AI technologies present social and ethical
risks and challenges, such as potential misuse by third parties for inappropriate purposes or
biased applications that could affect user perception and public opinion. Any inappropriate,
abusive or premature usage of conversational AI technologies, whether actual or perceived,
intended or inadvertent, committed by us or third parties, may dissuade prospective users from
adopting conversational AI services or solutions, impair the general acceptance of
conversational AI technologies by the society, attract negative publicity and adversely impact
our reputation, and affect views of policymakers and regulators. It may even violate applicable
laws and regulations in jurisdictions where we operate and subject us to legal or administrative
proceedings, pressures from activists and/or other organizations and heightened regulatory
scrutiny. Each of the foregoing events may in turn materially and adversely affect our
reputation, business, financial condition, results of operations and prospects.
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We may be subject to product liability claims or negative publicity if our solutions contain
or are perceived to contain defects, which may damage our reputation and negatively
affect our business, financial condition and results of operations.
The technologies underlying our solutions are inherently complex and may contain errors,
defects, security vulnerabilities or software issues that are difficult to detect and correct,
particularly when new features or capabilities are released or when integrated with new or
updated third-party hardware or software. In particular, the source of interruptions that our
solutions may experience, which could be caused by our solutions themselves, the products or
services of our third-party vendors, or equipment and networks of our customers or end users,
may be difficult to identify. Therefore, we may not be able to successfully correct serious
errors, defects, security vulnerabilities or software issues in a timely and cost-effective manner,
or at all.
Given that many customers or end users use our solutions in processes that are critical to
their businesses, any error, defect, security vulnerability or software issue in our solutions
could result in their losses. As a result, our customers may seek significant compensation from
us for any losses they suffer or cease conducting business with us altogether. In addition to
incurring significant expenses to remediate such defects, product liability claims or legal
proceedings may be brought against us. Even if unsuccessful, a claim brought against us by any
of our customers would likely be time-consuming and result in funds and managerial efforts in
defending thereagainst. In addition, our customers or end users may share information about
their negative experiences publicly, which could damage our reputation and result in a loss of
future sales. Any of the foregoing could result in revenue loss, significant expenditures of
capital, and a delay or loss in market acceptance, therefore having an adverse effect on our
business, financial condition and results of operations.
We derived a significant portion of revenue from our intelligent town project in Chengdu
during the Track Record Period.
During the Track Record Period, we derived a significant portion of our revenue from our
intelligent town project in Chengdu, a municipal-level project entailing the establishment of a
digitalized technological infrastructure for an intelligent town cluster where the administration,
production and service activities, healthcare, security and educations, etc., of more than 200
towns are being unified and integrated into one public service platform. Our revenue generated
from the project, i.e., Project No. 6, one of our top projects in terms of contract sum and
revenue contribution during the Track Record Period, contributed 26.4%, 24.9% and 16.6% of
our total revenue in 2021, 2022 and 2023, respectively. Comparatively, the other projects we
engaged during the Track Record Period were smaller in scale. Our revenue under the project
was derived from a group of local system integrators and enterprise-level users. Based upon the
term of the contract with the latest expiration date among the ongoing agreements that we
entered into therewith as of the Latest Practicable Date, the project is expected to be completed
on November 11, 2025. For details of the project and the solutions we offered therefor, see
“Business – Our Project – Top Projects” and “Business – Our Solution Offerings – V oicecomm
Solutions – City Management and Administration – Case Study – Case Study 1: Intelligent
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Town Project in Chengdu” in this prospectus. We cannot guarantee that our current contracts
under the project 6 will not be terminated early due to reasons out of our control, or that we
will be able to continue to maintain our relationships with our customers under such project
after current contracts expire, the failure of which will render us unable to derive any business
and revenue from them in the future. In such case, we may not be able to maintain our revenue
scale or growth if we are not able to secure new customers which, individually or in aggregate,
have comparable revenue contribution capacity, and our business, financial performance and
results of operations may be materially and adversely affected.
Our historical growth may not be indicative of our future performance, and any failure
to effectively manage our growth could materially and adversely affect our business,
financial condition and results of operations.
We achieved significant growth during the Track Record Period, as our revenue increased
from RMB459.9 million in 2021 to RMB515.0 million in 2022, and further to RMB813.0
million in 2023 at a CAGR of 33.0% from 2021 to 2023. Meanwhile, our gross profit increased
from RMB152.2 million in 2021 to RMB201.5 million in 2022, and further to RMB325.4
million in 2023 at a CAGR of 46.2% from 2021 to 2023. However, our historical growth may
not be indicative of our future performance. We cannot assure you that this level of significant
growth will be sustainable or achievable in the future for various reasons. Specifically, our
growth prospects depend on a number of factors, including but not limited to, our ability to
continuously:
 maintain and upgrade our technology infrastructure, and develop new technologies;
 further commercialize our solutions;
 expand the features and capabilities of our solutions;
 identify appropriate sites, infrastructure, facilities and equipment to support our
computing power expansion plans;
 attract new customers and retain existing ones;
 successfully complete and deliver our existing projects to the satisfaction of our
customers and/or end users, as well as identify, develop and acquire new project
opportunities;
 achieve widespread acceptance and use of our solutions;
 provide effective and timely customer support;
 maintain the security and reliability of our solutions;
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 expand our sales force adequately and increase our brand awareness through
marketing and promotional activities;
 attract, retain and motivate key employees, including research and development
talents as well as staff with in-depth industry know-how;
 price our solutions effectively without compromising our profitability;
 successfully compete against established companies and new market entrants;
 expand into new end-customer industries and launch new solutions;
 further expand our business internationally;
 comply with existing and newly enacted applicable laws, regulations and
governmental policies; and
 defend ourselves against litigations and regulatory, intellectual property, privacy,
data protection or other claims.
If we are unable to accomplish any one of these goals, our revenue growth may be
harmed. Further, all of the aforementioned endeavors will require significant capital
expenditures, research and development expenses, operating expenses, and allocation of
valuable management and employee resources. If our revenue does not increase sufficiently to
offset such expenditures, we may not be able to achieve or maintain profitability.
Our growth may also decline due to a variety of risks and uncertainties frequently
experienced by growing companies in rapidly evolving industries that we may encounter in the
future but not be able to address successfully. Moreover, expansion in new businesses may
increase the complexity of our operations and place a significant strain on our managerial,
operational, financial and human resources. We cannot assure you that we will be able to
effectively manage our growth or to implement all such business systems, operation procedures
and control measures effectively, which could hamper our growth and materially and adversely
affect our business, financial condition and results of operations.
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RISKS RELATING TO OUR BUSINESS
If we are not successful in maintaining and expanding the compatibility of our solutions
with a variety of hardware platforms and software applications developed by others, we
may become less competitive and our results of operations may be adversely affected.
The competitive position of our solutions depends in part on their ability to operate with
a variety of hardware platforms and software applications developed by third parties. As we
intend to integrate additional communication channels into our systems and make our solutions
available across a variety of IT systems, devices and platforms that we do not control, the
compatibility therewith is critical to the performance of our solutions. In recent years, smart
devices including mobile phones, tablets, wearable devices and other IoT devices have gained
increasing popularity. We expect this trend of technological developments to continue as more
advanced mobile communication technologies are broadly implemented. IT systems deployed
by customers or end users are also diversified and vary from each other. As such, we must
continuously modify and enhance our solutions to adapt to changes in hardware, software,
networking, browser, and database technologies.
However, changes to technologies used in our solutions or hardware platforms and/or
software applications that we intend to integrate may make it difficult for our customers or end
users to access our solutions. For instance, in the future, one or more technology companies
may choose not to support the operation of their hardware, software, or infrastructure that our
technologies are compatible with, or our technologies may not support the capabilities needed
to operate with such hardware, software, or infrastructure. Moreover, if a third party were to
develop software, products or services that compete with ours, such third party may choose not
to support one or more of our technologies. As a result, failure to ensure compatibility of our
solutions with third-party hardware platforms and software applications may negatively affect
our competitive edge, reduce the demand for our solutions, and result in user dissatisfaction,
which could harm our results of operations.
Any failure to offer high-quality maintenance services and technical support may harm
our relationships with our customers and/or end users and thus materially and adversely
affect our business and results of operations.
Our business depends on our ability to satisfy our customers and/or end users, not only
with respect to our solutions but also the maintenance services and technical support that are
performed to enable them to implement and use our solutions in order to address their business
needs. As we continue to grow our operations and support our customer base, we need to be
able to continue to provide effective maintenance services and efficient technical support at
scale. Any return, exchange and warranty policies that we adopt from time to time to improve
their experience and promote customer loyalty could nevertheless subject us to additional costs
and expenses which we may not recoup through increased revenue. If we revise these policies
to reduce our costs and expenses, however, our customers may be dissatisfied, which may
result in loss of existing customers or failure to acquire new customers at a desirable pace.
Also, if we experience increased demand for maintenance services and technical support, we
may face increased costs and not be able to recruit or retain sufficient qualified support
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personnel with experiences in such supporting performance. As a result, we may be unable to
respond quickly enough to accommodate short-term increases in demand for maintenance
services and technical support. In addition, we also may be unable to modify the future scope
and delivery of our maintenance services and technical support to align with changes in that
provided by our competitors.
If our customers and/or end users are not satisfied with the deployment and ongoing
services performed by us, the demand for which may increase continuously, we could lose our
customers, miss opportunities to expand our business with such customers, incur additional
costs, and lose, or suffer reduced margins on, our revenue. In addition, negative publicity
related to our maintenance services and technical support, regardless of its accuracy, may
further damage our business and results of operations by affecting our ability to compete for
new businesses.
Our business depends substantially on continuing efforts of our senior management, core
technical personnel and other key staff, as well as a competent pool of talents supporting
our existing operations and future growth. If we are unable to retain, attract, recruit and
train such personnel, our business and future prospects may be materially and adversely
affected.
Our future success depends substantially on continuing efforts of our senior management,
core technical personnel and other key staff. In particular, we rely on the expertise, experience
and vision of our leadership team in the areas of research and development, marketing and
sales as well as other functions, and other key individual contributors. If any senior member
of our management becomes unable or unwilling to continue to contribute his/her services to
us, we may not be able to find replacement easily, or at all. As a result, our business may be
severely disrupted, and our financial condition and results of operations may be materially and
adversely affected.
To execute our growth plan, we must also retain, attract, recruit and train a considerable
number of qualified personnel. Competitions for these personnel are intense, and we expect to
continue to experience difficulties in hiring and retaining employees with appropriate
qualifications. In order to compete for talents, we may need to offer higher compensation,
better trainings, more attractive career opportunities and other benefits to our employees,
which may be costly and burdensome. Also, many of the companies with which we compete
for experienced personnel have greater resources than we have. If we hire employees from our
competitors or other companies, such competitors or former employers may attempt to assert
that these employees or we have breached legal obligations, resulting in a diversion of our time
and resources and potential damages. In addition, our investments of significant time and
expenses in training our employees increase their value to competitors who may seek to recruit
them. Furthermore, any disputes or legal proceedings between us and our employees or any
labor-related regulatory authorities may divert our management and financial resources,
negatively impact staff morale, reduce our productivity, or harm our reputation and future
recruiting efforts. Last but not least, our ability to train and integrate new employees into our
operations may not meet the demand for our growing business. Any of the above issues related
to our workforce may materially and adversely affect our business and future prospects.
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Our business is subject to system and data security risks, and our technology
infrastructure may experience unexpected system failures, interruptions, inadequacy,
security breaches or cyberattacks, which may harm our reputation, business and results
of operations.
Nowadays, cyberattacks, distributed denial of service attacks, hacking and phishing
attacks, security breaches, computer malware and other malicious internet-based activities
continue to increase. Our business is at risk of similar attacks and breaches. We cannot assure
you that our relevant defense measures are, or will be, adequate to prevent any of such attacks
or breaches and protect us from any network or service interruptions, system failures or data
losses. We may not be able to anticipate or prevent all techniques that could be used to obtain
unauthorized access or to compromise our systems because such techniques change frequently
and are generally not recognizable until after an incident has occurred.
In addition, our technology infrastructure may encounter disruptions or other outages
caused by problems or defects in our own technologies and systems, such as malfunctions in
software or network overload. Our technology infrastructure may also be vulnerable to
damages or interruptions caused by telecommunication failures, power losses, human errors,
fires, floods, earthquakes and other natural disasters, or other accidents. Despite any
precautionary measures we will take, the occurrence of unanticipated problems that affect our
technology infrastructure could result in interruptions in the availability or performance of our
solutions.
As we cannot be certain that we will be able to address or respond to any vulnerabilities
in our software systems and technology infrastructure in a timely manner, or at all, any of the
aforementioned risks may cause interruptions to our operations, affect the ability of customers
or end users to use our solutions and reduce their satisfaction, harm our revenue and
profitability, and require us to allocate significant capital and other resources to alleviate
problems caused thereby. Moreover, security or technology infrastructure related incidents
experienced by us, or by others such as our competitors, customers or end users, may lead to
public disclosures and widespread negative publicity against us, our customers or end users, or
the industry in which we operate generally. Concerns regarding information security may thus
cause our existing customers to lose confidence in the security of our solutions, stop using or
promoting our solutions and decline to renew their agreements with us, which will make it
harder for us to acquire new customers and further affect our business, financial condition and
results of operations. In addition, security breaches or unauthorized access to confidential
information could subject us to legal or regulatory actions and liabilities under laws and
regulations on privacy and data protection. For details, see “– Key Risks Relating to Our
Business, Industry, Regulatory Compliance, General Operations and Financial Prospects – As
our business is subject to complex and evolving laws, regulations and governmental policies
regarding cybersecurity, privacy and data protection, actual or alleged failure to comply with
applicable laws, regulations and governmental policies could damage our reputation, deter
current and potential customers or end users from using our solutions, and subject us to
significant legal, financial and operational consequences” in this section.
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A substantial portion of our business depends on sales to the public sector. Developments
in government policies in respect of, and government spending on, conversational AI
products, services and/or solutions may negatively affect our business, financial condition
and results of operations.
During the Track Record Period, portions of our business depend on sales to the public
sector. Sales to the public sector can be expensive and time-consuming, and require significant
upfront time and expenses without any assurance that these efforts will generate a sale.
Moreover, government spending and the decision-making process are contingent upon various
factors that are not necessarily related to the features of our solutions and are subject to
changes beyond our control, such as the future growth of urban population or amendments in
government’s fiscal policy. There is no assurance that government spending that relates to our
business will continue to grow or remain at the current level. Accordingly, our business,
financial condition and results of operations may be adversely affected by certain events or
activities, including, but not limited to:
 changes in governmental fiscal or procurement procedures or decreases in available
government spending;
 changes in policies or priorities and resultant funding;
 changes in the government’s assessment of the capabilities that we offer;
 long payment cycle as required by the government’s internal financial management
and payment approval processes;
 appeals, disputes, or litigations relating to governmental procurement, including but
not limited to bid protests by unsuccessful bidders on potential or actual awards of
contracts granted to us or our business partners by the government;
 additional selection processes administered by the system integrators engaged;
 the adoption of new laws or regulations or developments in existing laws or
regulations;
 budgetary constraints, including constraints imposed by any lapses in appropriations
for the governments or certain of their departments and agencies;
 influences by, or competitions from, third parties with respect to existing, pending
or new contracts with governmental or public sector customers; and
 potential delays or changes in the government appropriations, including as a result
of incidents of natural disasters or epidemics and public health concerns.
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Any such event or activity, among others, could cause governmental and public sector
customers to delay or refrain from purchasing our solutions in the future, reduce the size or
payment amounts from existing or new governmental or public sector customers, or otherwise
have an adverse effect on our business, financial condition and results of operations.
Moreover, our growth in a broader sense depends in part on favorable government
policies in respect of the industry in which we operate and on conversational AI products,
services and/or solutions. However, such policies may be subject to developments that are
beyond our control, and there can be no assurance that government policies favorable to us will
continue. Developments in such policies may have a material adverse impact on our business,
financial condition and results of operations.
Our sales to system integrators could potentially subject us to risks relating to delays in
collecting trade receivables, which may adversely impact our liquidity, financial condition
and results of operations.
During the Track Record Period, we generated a significant percentage of revenue from
offering our solutions to system integrators that embedded our solutions into their offerings to
enterprise-level users. For details, see “Business – Our Revenue Model” and “– Customers and
Customer Support” in this prospectus. This business arrangement introduces inherent risks
related to delays in collecting trade receivables as system integrators may prioritize settling
payments from their end customers before making payments to us as their upstream suppliers,
thereby temporarily impacting our liquidity, financial condition and results of operations.
Despite our efforts to mitigate these risks, there can be no assurance that our measures will
always be effective in managing trade receivables collection and working capital challenges.
Unforeseen disruptions, macro-economic condition fluctuations, or systemic payment delays
within the value chain compounded by our business arrangement with system integrators could
adversely our ability to effectively manage our trade receivables collection. For details of risks
relating to our trade receivables balance and trade receivables turnover days that increased
significantly during the Track Record Period, see “– Key Risks Relating to Our Business,
Industry, Regulatory Compliance, General Operations and Financial Prospects – We are subject
to credit risk related to defaults of customers as our trade receivables balance and trade
receivables turnover days increased significantly during the Track Record Period, and any
significant default on our trade receivables could materially and adversely affect our liquidity,
financial condition and results of operations” in this section.
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If our expansion into new end-customer industries or attempt to upgrade our solutions is
unsuccessful, our business and growth prospects may be materially and adversely
affected.
Leveraging our conversational AI technologies, we are able to provide innovative
solutions designed to address diversified needs of enterprise-level users across different
end-customer industries. We cannot assure you that we will be able to continuously expand into
new end-customer industries or develop new solutions in the future. Expanding offering
categories into new areas involves new risks and challenges. Our lack of familiarity with new
end-customer industries may make it more difficult for us to keep pace with the evolving user
demand and preferences. In addition, there may be one or more existing market leaders in any
end-customer industry in which we decide to expand, and such companies may be able to
compete more effectively than us by leveraging their experiences in doing business in that
market as well as their deeper industry insights and greater brand recognition among users
therein. We may also be required to develop new business relationships and capabilities, and
comply with new laws and regulations applicable to these businesses. Moreover, expansion
into any new end-customer industry and development of new solutions may place a significant
strain on our management and resources, and cause us to incur substantial research and
development and other costs and expenses before generating any revenues. Any failure to
expand successfully could have a material adverse effect on our business and growth prospects.
We may fail to effectively implement our future expansion and acquisition plans, which
may have a material adverse effect on our business, reputation, financial condition and
results of operations.
We have made investments and acquisitions in recent years, such as our acquisitions of
Yuanya Information and Jinxun Digital Intelligence. For details, see “History, Development
and Corporate Structure – Acquisitions During the Track Record Period” in this prospectus. We
may in the future evaluate and consider a wide array of acquisitions and investments that we
believe are complementary to our growth strategies, particularly those that can help us enrich
our solution offerings, enhance our technologies, and expand our customer base. Acquisition
processes involve certain known and unknown risks that could impose significant challenges,
including but not limited to that:
 we may not be able to identify suitable acquisition candidates or to consummate
acquisitions on acceptable terms in a timely and cost-effective manner, or at all;
 we may compete with others to acquire complementary businesses and technologies,
which could result in decreased availability of, or increased price for, suitable
acquisition candidates;
 we may not be able to obtain the necessary financing on favorable terms, or at all,
to finance any or all of our potential acquisitions;
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 our results of operations may be harmed due to dilutive issuances of equity
securities, the use of our available cash or incurrence of debts; and
 our acquisition activities may be subject to various laws, rules and regulations,
including that on antitrust and competition, of the countries in connection with any
proposed acquisitions.
Even if a planned acquisition were consummated, we might not be able to achieve the
anticipated benefits or synergies from our acquired businesses due to a number of factors,
including but not limited:
 difficulties in integrating the acquired personnel, products and/or solutions,
operations and technologies, or effectively managing the combined business
following the acquisition;
 unanticipated costs or liabilities associated with the acquisition that may adversely
affect us following the acquisition;
 for investments over which we do not obtain management and operational control,
lack of influence over the controlling partners or shareholders, which may prevent
us from achieving our strategic goals in such investments;
 new regulatory requirements and compliance risks that we become subject to as a
result of investments or acquisitions in new industries;
 actual or alleged misconduct or non-compliance by the acquired company (or by its
affiliates) that occurred prior to our acquisition, which may lead to negative
publicity, government inquiries or investigations against such company or us;
 difficulties in converting the customers of the acquired business to our solutions due
to disparities in the business model of the acquired company;
 potential issues with the technologies, internal controls and financial reporting of
the acquired company;
 increased operating costs and expenses;
 disruptions of our ongoing business and diversion of management’s attention from
other business concerns;
 harm to our existing relationships with our business partners as a result of the
acquisition;
 the occurrence of significant goodwill impairment charges and amortization
expenses for other intangible assets;
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 the loss of our or the acquired business’s key employees and established customer
relationships; and
 diversion of resources that could have been more effectively deployed in other parts
of our business.
Any negative developments described above could disrupt our existing business and have
a material adverse effect on our business, reputation, financial condition and results of
operations.
If we are unable to manage the risks related to our expansion in international markets,
which involves various technical and regulatory risks and uncertainties, our business,
financial results and prospects may be adversely impacted.
As we may explore business opportunities in overseas markets and regions, our
international operations and expansion efforts may result in allocation of significant resources
and management attention, and subject us to intellectual property, regulatory, economic and
political risks and uncertainties that are different from those in the PRC. As we increase our
international sales efforts, the various risks and uncertainties that we may face include but are
not limited to:
 the need to localize and adapt our solutions for specific countries, including
translation into foreign languages and the associated costs and expenses;
 difficulties in staffing and managing foreign operations, particularly in hiring and
training qualified sales and service personnel;
 different pricing environments, potentially longer sales and accounts receivable
payment cycles and collections issues;
 challenges in commercializing our solutions in new markets where we have limited
experiences with the local market dynamics and no existing or developed sales,
distribution and marketing infrastructure;
 new and different sources of competitions;
 general economic conditions and political instability in international markets and
the unexpected changes thereof;
 fluctuations in between the value of Renminbi and foreign currencies, which may
make our solutions more expensive in other countries or may impact our results of
operations when our revenue are translated into Renminbi;
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 compliance challenges related to the complexity of conflicting and changing
territorial and trans-jurisdictional laws and regulations, including that on privacy
and data protection, employment, tax and telecommunications, and obtaining the
necessary licenses, permits and approvals;
 weaker protection for intellectual property and other legal rights, and practical
difficulties in enforcing or defending against claims thereof;
 increased risk of international telecom fraud;
 laws and business practices favoring local competitors; and
 increased financial accounting and reporting burdens and complexities.
If we are unable to effectively avoid or mitigate these risks, our ability to expand in
international markets will be impaired, or our international business may not be able to achieve
or sustain profitability, which could have a material adverse effect on our business, financial
condition and prospects.
Failure to expand our sales and marketing capabilities could limit the number of
customers we serve and the spending by our customers, and materially and adversely
affect our ability to grow and expand.
Our ability to increase our customer base and achieve broader market acceptance of our
solutions will depend to a considerable extent on our ability to expand our sales and marketing
capabilities. As our business grows, we may need to strengthen our sales and system integration
capabilities by expanding our direct sales teams, providing more training opportunities and
upgrading our sales management system. Our business may be harmed if we fail to retain key
members of our direct sales force or if our efforts, and the expenses incurred, to retain, expand
and train our direct sales force do not generate a corresponding increase in revenue. In
addition, our sustained success also requires continued efforts to develop and maintain stable
relationships with third-party solution business partners and increasing the sales opportunities
that they refer to us. If we fail to do so, or if they are not successful in their sales efforts, we
may be unable to grow and expand our business, and our results of operations and financial
condition could be materially and adversely affected.
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If we fail to retain existing customers, attract new customers or increase the spending by
our customers, our business and results of operations could be materially and adversely
affected.
We may not be able to effectively retain our customers after the initial sale, and there is
no assurance that our customers will repurchase from us within a short period of time, or at all.
As the industry in which we operate matures, or as our competitors introduce less costly and/or
differentiated products, services and/or solutions that are perceived to compete favorably
against ours, our ability to attract new customers and retain or upsell existing customers could
be impaired. There can be no assurance that we will always be able to renew our agreements
with existing customers, attract new customers or develop new business from existing
customers. In particular, if we lose any of our key customers or if such customers reduce their
purchase of our solutions, our business, results of operations and financial condition could be
significantly impacted.
It may not be possible for us to predict the level of demand of our customers for our
solutions, which may be affected by a combination of factors beyond our control. For instance,
our customers may not be able to sustain or grow their business operations and may as a result
cancel or reduce their purchase of our solutions. Our revenue from customers in a particular
industry may fluctuate due to different reasons, including factors affecting the end-customer
industries we focus on such as market or economic conditions, development in regulatory
requirements and release of new government policies. If certain enterprises that we serve elect
to terminate or reduce their operations due to developments in laws and regulations or
interpretation of the existing ones, our business and results of operations may be materially and
adversely affected.
Our sales cycle can be lengthy and unpredictable and requires considerable time and
expenses under certain circumstances, and we may encounter configuration, integration,
implementation and customer support challenges that could affect our results of
operations.
Our sales cycle primarily consists of initial communications, project evaluation and
design, proof of concept and contracts execution, which varies from project to project and can
be lengthy and unpredictable under certain circumstances. Normally ranging from two to three
months for ordinary projects, our sales cycle could nevertheless be as long as over twenty
months when serving the public sector, especially respect to large-scale and complex projects.
As some customers or end users may not have prior experiences with conversational AI
products, services or solutions, they may spend significant time and resources evaluating our
solutions before they deploy our solutions. Similarly, we typically spend time and efforts
determining their requirements and educating them about the usage, technological capabilities
and benefits of our solutions. As a result, our sales efforts may require a significant investment
of human resources, time and expenses, including that by our management. Moreover, it may
not always be possible for us to accurately forecast whether we will secure the contract, when
a potential sale will close, the size of the customer’s initial service order and the period over
which the implementation will occur, any of which may impact the amount of revenue we
recognize or the timing of revenue recognition. If our sales efforts to a potential customer do
not result in sufficient revenue to justify our investments, our results of operations could be
adversely affected.
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In addition, we may experience challenges in configuring, integrating and implementing
our solutions and providing ongoing support. As customers’ or end users’ networks and
operational systems may be complex, the configuration, integration and implementation of our
solutions for them may require substantial time and resources. There can be no assurance that
they will make available to us the necessary personnel and other resources for a successful
configuration. The lack of local resources may prevent us from proper configurations, which
can in turn adversely impact the quality of solutions that we deliver over their networks, and
may result in delays in the implementation of our solutions. If a customer is unsatisfied with
the quality of support services that we provide, we may need to incur costs beyond the scope
of our contract therewith in order to address the issue, which may in turn reduce or eliminate
the profitability of the contract. In addition, negative publicity related to our customer
relationships, regardless of its accuracy, could harm our reputation and make it more difficult
for us to attract new customers and retain existing ones. Hence, any failure to effectively
execute the sale, configuration, integration, implementation and ongoing support of our
solutions will materially and adversely affect our results of operations and overall ability to
grow our customer base.
Our business relies on the communication infrastructure and telecommunications
resources provided by third parties and any disruption of, or interference with, our use
of such third-party services would adversely affect our business, results of operations and
financial condition.
Our business depends on the performance and reliability of the internet infrastructure in
China. Almost all access to the internet in China is maintained through state-owned
telecommunication operators under the regulatory supervision of the MIIT. In addition, the
national networks in China are connected to the internet through state-owned international
gateways, which are the only channels through which a domestic user can connect to the
internet outside of China. As such, we may not have access to alternative networks in the event
of disruptions, failures or other problems with China’s internet infrastructure, which may not
always support the demand associated with continued growth in internet usage.
Moreover, we rely on major telecommunications companies in China to provide
uninterrupted and error-free services necessary for our solution offerings through their
telecommunications networks. We exercise little control over them, which increases our
vulnerability to problems with the services they provide. For instance, the failure of
telecommunications network operators to provide us with the requisite bandwidth could
interfere with the functionality and availability of our solutions. Also, these
telecommunications companies possess significant bargaining power and may change their
service terms or other policies during the course of our cooperation. If the prices that we pay
for telecommunications and internet services rise significantly, our gross margins and
operation plans could be adversely affected. As a result, any disruption, or interference with,
our use of such third-party services would adversely affect our business, results of operations
and financial condition.
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Misconduct, non-compliance or omissions by our employees or third parties involved in
our business could harm our results of operations and reputation.
Misconduct and omissions by our employees could subject us to liabilities or negative
publicity. For instance, the information that we process or transmit in our business may be
subject to improper disclosure and misappropriation by our employees. We are also exposed to
the risk of other types of employee misconduct, including failing to comply with government
regulations, whether intentionally or not, engaging in unauthorized activities and
misrepresentation during marketing activities. Despite our strict human resources risk
management policies implemented, there can be no assurance that our employees will not
engage in misconduct or omissions that could materially and adversely affect our results of
operations and reputation.
Misconduct and omissions by our business partners, including our various suppliers,
service providers and customers, as well as other third parties who have established business
relationships with our business partners, could also subject us to liabilities or negative
publicity. Our business partners may be subject to regulatory penalties or punishments because
of their regulatory compliance failures, which may, directly or indirectly, affect our business.
We cannot be certain whether such third parties have infringed or will infringe any other
parties’ legal rights or violate any regulatory requirements. We cannot assure you either that we
will be able to identify irregularities or non-compliances in the business practices of our
business partners or other third parties, or that such irregularities or non-compliance will be
corrected in a prompt and proper manner. It is not always possible to deter third-party
misconduct, and the precautions we take to prevent and detect such misconduct may not be
effective in controlling unknown or unmanaged risks or losses. As we cannot rule out the
possibility of incurring liabilities or suffering losses due to any non-compliance by third
parties, any legal liability and regulatory action on our business partners or other third parties
involved in our business may affect our business activities and reputation, which may in turn
affect our results of operations.
Our arrangements with third-party business partners in our operations reduce our
control over the quality, development, and deployment of our solutions and could harm
our business.
We engage third parties in our business operations, including procuring certain hardware
components and other equipment, outsourcing certain non-core and less sophisticated research
and development projects to third-party vendors, and collaborating with system integrators for
the sales of our solutions. Such arrangements may reduce our direct control over the quality,
development and deployment of our solutions, and any failure of our third-party business
partners to perform their responsibilities or be in compliance with all applicable laws and
regulations may have a material negative impact on our business. For instance, our third-party
business partners may experience operational difficulties, including supply shortages,
reductions in the availability of production capacity, failures to comply with product
specifications, failures to meet delivery deadlines, and/or insufficient quality control. Our
third-party business partners may also experience disruptions in their operations due to
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equipment breakdowns, labor strikes or shortages, natural disasters, component or material
shortages, cost increases, environmental non-compliance issues or other similar problems. In
addition, we may not be able to renew contracts with our third-party vendors or identify
qualified substitutes who are capable for providing the equipment and services that we need for
our solutions.
For details of our reliance on the communication infrastructure and telecommunications
resources provided by third parties and the risks related thereto, see “– Our business relies on
the communication infrastructure and telecommunications resources provided by third parties
and any disruption of, or interference with, our use of such third-party services would
adversely affect our business, results of operations and financial condition” in this section.
We had a concentration of suppliers during the Track Record Period.
Purchase amount from our five largest suppliers in each year of the Track Record Period
amounted to RMB279.0 million, RMB336.0 million and RMB308.0 million, respectively,
representing 72.6%, 65.9% and 63.0% of our total purchase amount for the same years,
respectively; purchase amount from our largest supplier in each year of the Track Record
Period amounted to RMB152.6 million, RMB136.7 million and RMB148.4 million,
respectively, representing 39.7%, 26.8% and 30.4% of our total purchase amount for the same
years, respectively. We cannot assure you that we will be able to secure a stable supply of
qualified equipment and/or services at all times going forward. Specifically, we cannot assure
you that we will be able to identify an alternative qualified supplier in a timely manner or at
all, in the event that any of our existing suppliers terminates its contract with us or is no longer
qualified. Any change in suppliers could also require significant efforts or investments in
circumstances where the items or services supplied are integral to solution performance or
incorporate unique technologies, and the loss of existing supply contracts could have a material
adverse effect on us.
The termination of any collaborations with our partners for joint research and
development projects may adversely affect our business prospects.
We entered into strategic partnerships with certain partners for joint research and
development projects and other initiatives. For details, see “Business – Research and
Development” in this prospectus. We expect to continue our substantial collaborations with our
partners in various aspects. However, there can be no assurance that our partners will not
discontinue their collaborations with us or collaborate with any of our competitors. In the event
that such collaborations suspend, expire or are terminated by our partners, we cannot assure
you that we will be able to establish new partner relationships or extend existing relationships
with our partners. If we are unable to maintain our relationships with our key partners, any of
our collaborations with our key partners is terminated, or we are unable to establish substitute
partner relationships, we will need to improve the research and development capabilities solely
on our own and our business prospects may be materially and adversely affected.
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Our use of open-source software could impose limitations on our business operations, and
certain software we use leverages open-source codes, which, under certain circumstances,
may lead to unintended consequences and, therefore, could materially and adversely
affect our business, results of operations and financial condition.
We use open-source software in some of our technologies and expect to continue to use
open-source software in the future. Accordingly, we may face allegations from others alleging
ownership of, or seeking to enforce the terms of, an open-source license, including by
demanding release of the open-source software, derivative works, or our source code that was
developed using such software. These allegations could also result in litigation. The terms of
many open-source licenses remain to be further elaborated and interpreted in judicial practice.
There is a risk that these licenses could be construed in a way that could impose unanticipated
conditions or restrictions on our ability to commercialize our solutions. In such an event, we
may be required to seek licenses from third parties to continue commercially offering our
software, make our code generally available in source code form, re-engineer our software, or
discontinue the sale of our software if re-engineering could not be accomplished in a timely
and cost-effective manner, any of which could adversely affect our business operations.
The use of open-source software subjects us to a number of other risks and challenges.
As certain software we use leverages open-source codes, we may, under certain circumstances,
be subject to unintended consequences that could materially and adversely affect our business,
results of operations and financial condition. Open-source software is subject to further
developments or modifications by anyone. It is also possible for competitors to develop their
own products, services and/or solutions using open-source software, potentially reducing the
demand for our solutions or rendering them no longer useful. If we are unable to successfully
address these challenges, our business, results of operations and financial condition may be
adversely affected, and our development costs may increase.
We may be unable to obtain, maintain and protect our intellectual property rights and
proprietary information or prevent third parties from any unauthorized use of our
technologies.
We consider our patents, copyrights, trademarks, domain names, trade secrets and other
intellectual properties critical to our success and rely on a combination of intellectual property
laws, trade secrets protection, intellectual property ownership clauses with our employees to
protect these rights. However, the steps we take to secure, protect and enforce our intellectual
property rights may be inadequate. We may not be able to obtain any further patents or
trademarks, any of our patents upon grant could be invalidated or our competitors could design
their products around such patented technologies, and our pending applications may not result
in the issuance of patents or trademarks. Consequently, we may be unable to prevent our
technologies from being infringed or exploited, which could require costly efforts in order to
protect our technologies.
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Policing unauthorized use of our technologies and other intellectual properties is difficult
and expensive, and we may be required to spend significant resources to monitor and protect
these rights. Litigations brought to protect and enforce our intellectual property rights could be
costly, time-consuming and distracting to our management, and could result in the impairment
or loss of our intellectual property. Furthermore, our efforts to enforce our intellectual property
rights may be met with defenses, counterclaims and countersuits attacking the validity and
enforceability of our intellectual property rights. Accordingly, we may not be able to prevent
third parties from infringing upon or misappropriating our intellectual properties. Any failure
to secure, protect and enforce our intellectual property rights could substantially harm the
value of our technologies, business and prospects.
Confidentiality agreements and intellectual property ownership clauses with employees
may not adequately prevent disclosure of our trade secrets and other proprietary
information.
We have devoted substantial resources to the development of our technologies and
know-how. Although we enter into employment agreements with confidentiality and
intellectual property ownership clauses with our employees, we cannot assure you that these
agreements and/or clauses will not be breached, we will have adequate remedies for any breach
in time, or at all, or our technologies, know-how or other intellectual properties will not
otherwise become known to third parties. In addition, other third parties may independently
discover trade secrets and proprietary information, limiting our ability to assert any proprietary
rights against such parties. Costly and time-consuming litigations may be necessary to enforce
and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret
protection could adversely affect our competitive position.
We may be subject to intellectual property infringement claims, which could be
time-consuming and costly to defend and may result in diversion of our financial and
management resources.
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, know-how, trade secrets or
other intellectual property rights held by other parties, whether such claims are valid or
otherwise. As the validity, enforceability and scope of protection of intellectual property rights
in general and patents in specific are still evolving, we cannot assure you that courts or
regulatory authorities would agree with our analysis. As we face increasing competitions from
other competitors, there may be a higher risk for us to be subject to intellectual property
infringement claims or other legal proceedings. Defending against such intellectual property
infringement claims is time-consuming and costly, and may divert our financial and
management resources from our business and operations. There is no guarantee that we can
obtain favorable final outcomes in all cases. Such intellectual property claims may harm our
brand and reputation, even if they are vexatious or do not result in any liability. If we are found
to have violated the intellectual property rights of any third party, we may be subject to
liabilities for our infringement activities, which could result in a judgment, fine or settlement
involving a payment of a material sum of money, prohibitions from using such intellectual
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property, or requirements for incurring licensing fees or developing alternatives of our own.
Such significant monetary liabilities and/or restrictions or prohibitions from using the
intellectual property at question may materially disrupt our business, financial condition and
results of operations. In the event that we have to indemnify our customers or other third
parties for their losses suffered or incurred as a result of intellectual property infringement
claims against us, large indemnity payments could be imposed on us that may further harm our
business, results of operations and financial condition. In addition, any dispute with customers
respecting such indemnification obligations could adversely affect our relationships with them
and our prospective customers, and harm our business and results of operations.
The changes in international political relationships, trade policies and trade barriers, or
the escalation of trade tensions, may have an adverse effect on our business operations.
In order to cater to enterprises’ business needs, we may from time to time procure
hardware devices into which our software only solutions are embedded, including from certain
overseas suppliers as the circumstance may require. In the event that the countries from which
we import equipment impose import tariffs, trade restrictions or other trade barriers affecting
the importation of such components of our solutions, we may not be able to obtain a steady
supply in time, at competitive prices or at all, and our business and operations may be
adversely affected. Our business is therefore subject to constantly changing international
economic, regulatory, social and political conditions, and local conditions in foreign countries
and regions.
It is notable that the U.S. government has made significant changes in its trade policy in
recent years and has taken certain actions that may materially impact international trade, such
as announcing import tariffs which have led to some other countries to impose tariffs against
the U.S. in response. Currently, it remains unclear what actions, if any, the U.S. government
will take with respect to other existing international trade agreements. It is also unknown
whether and to what extent new tariffs (or other new laws or regulations) will be adopted, or
the effect that any such actions would have on us or our industry. Furthermore, any escalation
in existing trade tensions or the advent of a trade war, or news and rumors of the escalation of
a potential trade war, could affect consumer confidence and have a material adverse effect on
our business, results of operations and, ultimately, the market price of our H Shares. Rising
political tensions could reduce levels of trades, investments, technological exchanges and other
economic activities between the relevant major economies, which would have a material
adverse effect on global economic conditions and the stability of global financial markets. If
any new tariffs, legislation and/or regulations are implemented, or if existing trade agreements
are renegotiated, such changes could have an adverse effect on our business, financial
condition and results of operations.
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RISKS RELATING TO OUR INDUSTRY
If the growth of full-stack enterprise-level conversational AI commercialization or the
usage of our solutions in end-customer industries we focus on does not meet expectation,
or the industry in which we operate develops more slowly than we expect, our business,
growth and prospects may be significantly affected.
We may face challenges with respect to the future growth rate and size of China’s
enterprise-level conversational AI solution market in general that continues to evolve, as well
as adoption rates and demand for our solutions in specific. According to the iResearch Report,
the enterprise-level conversational AI solution market in China reached RMB62.1 billion in
2023, and is expected to reach RMB204.1 billion in 2028, at a CAGR of 26.9% from 2023 to
2028. However, the penetration rate of enterprise-level conversational AI solutions in China
was merely 11.6% in 2023, as compared to 18.2% for the U.S., according to the same source.
Market expansion for enterprise-level conversational AI solutions in China depends on a
number of factors. For details, see “Industry Overview – Market of IT Solutions Empowered
by Conversational AI & UC in China” in this prospectus. If such solutions do not achieve
widespread acceptance, or there is a reduction in demand therefor caused by technological
challenges, privacy and data protection concerns, governmental regulations, or competing
technologies, products, services and/or solutions, our business, growth prospects and results of
operations will be materially and adversely affected.
Our future success will also depend in large part on our ability to further penetrate the
industry in which we operate, which is contingent upon a number of factors, such as potential
users’ level of awareness of our solutions and the widespread use of similar products, services
and/or solutions. We cannot assure you that the trend of adopting and utilizing such products,
services and/or solutions by potential users will continue in the future, as they may be reluctant
to invest in novel technologies. Also, the industry in which we operate is not as mature as the
markets for traditional communication systems or platforms that have been well established,
and it is uncertain whether our solutions will achieve and sustain high levels of user demand
and market acceptance. In addition, we cannot be sure that our expenditures on educating
potential users about our solutions will help our solutions achieve any additional market
acceptance. Moreover, if other providers of similar products, services and/or solutions
experience security incidents, loss of customer data, disruptions in delivery or other problems,
the market as a whole, including our solutions, may be harmed. All in all, if the market in
which we operate fails to grow or grows slower than we expect, our business, growth and
prospects could be significantly affected.
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As the industry in which we operate is characterized by constant changes, we may fail to
continuously innovate our technologies and provide useful solutions that meet users’
expectations.
The industry in which we operate is characterized by constant changes, including rapid
technological evolutions, frequent introductions of new products, services and/or solutions,
continual shifts in user demand and constant emergence of new industry standards and
practices. As such, our success will be dependent on our ability to respond to these changes in
a cost-effective and timely manner. For instance, we need to develop expertise across different
end-customer industries, adapt our solutions to different end-customer industries, stay abreast
of the continuously evolving industry trends and rapid technological developments, and
constantly anticipate the emergence of new technologies and assess their market acceptance.
We also need to invest significant resources in research and development to lead technological
advances in order to keep our solutions innovative and competitive in the market.
However, we may not be able to leverage new technologies effectively or adapt our
solutions to meet user needs or emerging industry standards. Our technology approach might
not align with our future development plans or even become obsolete if we are unable to adapt
in a cost-effective and timely manner to changing market conditions, whether for
technological, legal, financial or other reasons. Moreover, uncertainties regarding the timing
and nature of the development of conversational AI technologies, or modifications to existing
solutions or technologies, could impose further challenges to our research and development. As
our success will depend on our ability to continuously identify, develop, acquire or protect
advanced and new technologies that are valuable to our solutions, failure to do so could render
our existing solutions obsolete and unappealing, thereby adversely affecting our business
prospects.
Demand for our solutions may not increase as rapidly as we anticipate due to a variety of
factors, including weakness in general economic conditions, which would materially and
adversely affect our business, results of operations and financial condition.
Our revenue growth is highly dependent on enterprise-level users’ continuous corporate
spending on and demand for our solutions, which may not increase as rapidly as we anticipate
due to a variety of factors, including any weakening economic conditions. The global
macroeconomic environment face numerous challenges. For instance, there have been concerns
about international political relationships, which may potentially have negative economic
effects, such as trade policies, treaties, government regulations and tariffs. Economic
conditions in China may be affected by global economic conditions, as well as a number of
other complex factors. Any severe or prolonged slowdown in the global or Chinese economy
might lead to tighter credit markets, increased market volatility, sudden drops and dramatic
changes in business, which may materially and adversely affect our business, results of
operations and financial condition.
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RISKS RELATING TO REGULATORY COMPLIANCE
We are subject to extensive and evolving regulatory requirements, and we may be
adversely affected by the complexity and developments in regulations related to our
business.
We are operating in an industry that the relevant government authorities extensively
regulate, with applicable laws, regulations and policies and their interpretation and
enforcement subject to future developments. As such, we may be subject to compliance risks
since, under certain circumstances, it may be difficult to determine what actions or omissions
may be deemed to be in violation of applicable laws and regulations. We cannot assure you that
future laws and regulations or the interpretation of existing ones would not render our
operations non-compliant or that we would always be in full compliance with applicable laws
and regulations. Responding to any action will likely result in a significant diversion of
management’s attention and incurrence of significant expenses. Non-compliance with
applicable laws or regulations could subject us to investigations, sanctions, enforcement
actions, disgorgement of profits, fines, damages, civil and criminal penalties or injunctions. If
any governmental sanction, fine or penalty is imposed, or if we do not prevail in any civil or
criminal litigation, our business, financial condition, results of operations and reputation could
be harmed. In addition, we may be required to modify our business models as well as solution
offerings in a manner that undermines their attractiveness. Also, if we determine that the
requirements for operating in compliance are overly burdensome, we may elect to terminate the
non-compliant operations. In each case, our business, financial condition and results of
operations may be further affected.
We are required to obtain and maintain the requisite licenses, permits or approvals
required in any jurisdiction where we operate our business, and if we are required to take
actions that are time-consuming or costly in order to obtain and maintain such licenses,
permits or approvals, our business, financial condition and results of operations may be
materially and adversely affected.
The industry in which we operate is extensively regulated, and we are required to obtain
and maintain the requisite licenses, permits or approvals required in the jurisdictions where we
operate our business from different regulatory authorities. For details, see “Regulatory
Overview” in this prospectus. For instance, we have obtained from the MIIT V AT licenses. For
details of our material licenses and permits, see “Business – Licenses and Permits” in this
prospectus. We may also be required to take actions that are time-consuming or costly in order
to obtain and maintain such licenses, permits or approvals, which may negatively affect our
financial condition and results of operations.
As the regulatory regime for the industry in which we operate continues to evolve and in
the course of our expansion to new business operations, the government authorities may
continue to implement new laws and regulations, or interpretations and applications of existing
laws and regulations, applicable to us. As such, we may be required to obtain additional
licenses, permits or approvals so that we can continue to operate our existing or future
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businesses, which may increase our costs for business operations. We cannot assure you that
we can successfully do so in a timely and cost-effective manner, or at all, considering the
possible future developments regarding the interpretation and implementation by the relevant
authorities of existing and future laws and regulations governing our business activities.
Similarly, there is no assurance that we can successfully update or renew the licenses, permits
or approvals required for our business upon revocation or expiration in a timely and
cost-effective manner, or at all, which may be due to various reasons, including changes in our
shareholding structure. Specifically, if we fail to renew or update any of our current licenses
and permits, including our V AT licenses, in a timely manner or at all, our business, results of
operations and financial condition could be materially and adversely affected. Moreover, if we
fail to obtain and maintain any of the required licenses, permits or approvals in any jurisdiction
where we operate our business, we may be subject to various penalties, such as confiscation
of the revenue generated through the unlicensed business activities, imposition of fines and
discontinuation or restriction of our operations. Any such penalties may disrupt our business
operations, negatively impact our reputation and materially and adversely affect our business,
financial condition and results of operations.
Export control and economic or trade restrictions that were imposed on a number of
entities may affect our business, financial condition and results of operations.
In recent years, the U.S. government imposed targeted economic and trade restrictions on
a number of Chinese companies and institutions that limit their access to U.S.-origin goods,
software and technologies (collectively, “ Items ”), as well as items that contain a significant
portion of certain U.S.-origin Items or are a direct product of certain U.S.-origin Items. U.S.
export controls and trade laws and regulations are complex and likely subject to frequent
changes, and the interpretation and enforcement of the relevant regulations involve substantial
uncertainties, which may be driven by political and/or other factors that are not within our
control or that are heightened by national security concerns. For example, the U.S. government
has tightened certain chip shipments to China. If any potential restrictions, any associated
inquiries or investigations, or any other government actions occur, they may be difficult or
costly to comply with and may, among other things, delay or impede the development of our
technologies and solutions, and hinder the stability of our supply chain. They could also result
in negative publicity, require significant time and attention of the management, and subject us
to fines, penalties or orders that we cease or modify our existing business practices. Any of
these events may have a material adverse effect on our business, financial condition and results
of operations.
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We are subject to complex anti-corruption, anti-money laundering and anti-bribery laws
of the jurisdictions where we operate our business.
We are subject to complex anti-corruption, anti-money laundering and anti-bribery laws
and regulations in the jurisdictions where we operate our business. For example, under the
Anti-Unfair Competition Law of the PRC, any commercial bribery committed by an employee
of a given company will be deemed as conduct of such company unless it has evidence to rebut
the presumption, and the offering of anything of value to employees, agents or representatives
of any given transacting party or to any person with substantial influence over the decision
making of such transacting party with an intent to obtain business opportunities or commercial
advantages constitutes bribery. The scope of bribery includes not only kickbacks, gifts and
other things of value or benefit transfer, but also rebates that are not properly recorded or
evidenced in accounting. Therefore, any wrongdoings committed by our employees, even if
committed without our knowledge or in violation of our policies, or any bad practice in terms
of record keeping of the spending by our employees during the business development process,
could subject us to anti-corruption and anti-bribery law liabilities.
If our compliance processes have not been duly implemented or our internal control
systems have not been operating properly, or if any of our subsidiaries, employees or other
persons engages in fraudulent, corrupt or other unfair business practices or otherwise violates
applicable laws, regulations or our internal control policies, we could become subject to
investigations, enforcement actions or proceedings by governmental authorities, which may
disrupt our operations, lead to management distraction and significant costs and expenses, and
result in penalties, fines sanctions, or other liabilities. In addition, our reputation and sales
activities could be adversely affected if we become the subject of any negative publicity related
to actual or potential violations of anti-corruption, anti-money laundering and anti-bribery laws
and regulations. Given the uncertainty, complexity and scope of many of these regulatory
matters, their outcome generally cannot be predicted with a reasonable degree of certainty, and
any of the foregoing results could materially and adversely affect our business, financial
condition and results of operations.
We are subject to regulatory requirements in labor-related laws and regulations.
Companies operating in China are required to participate in various government-
sponsored employee benefit plans, including certain social insurance, housing reserve funds
and other welfare-oriented payment obligations, complete related registration with the
competent authorities and contribute to the 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. We had
historically engaged third-party human resource agencies to make social insurance and housing
provident funds for our employees during the Track Record Period. As of the Latest Practicable
Date, we had not received any notice of warnings or been subject to any administrative
penalties or other disciplinary actions from the relevant governmental authorities in this regard.
As advised by our PRC Legal Adviser, if any of the relevant social insurance authorities is of
the view that we have failed to make full social insurance contributions for our employees in
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accordance with the relevant laws and regulations, it may order us to pay outstanding amounts
within a prescribed time limit. As a result, we may be subject to a late charge at the daily rate
of 0.05% on the outstanding amounts from the date on which such amounts are payable. If such
payment is not made within the prescribed period, the competent authorities may further
impose a fine one to three times the amount of any overdue payment. In addition, if any of the
relevant housing reserve fund authorities is of the view that we have failed to make full housing
reserve fund contributions for our employees in accordance with the relevant laws and
regulations, it may order us to make the outstanding payment within a prescribed time limit.
If the payment is not made within such time limit, an application may be made to PRC courts
for compulsory enforcement. In sum, if we are found not in compliance with relevant laws and
regulations, we may face fines or penalties which could adversely affect our business, financial
condition and results of operations.
Moreover, as the interpretation and implementation of labor-related laws and regulations
may continue to evolve and the relevant government authorities have recently enhanced
measures relating to social insurance collection, which may lead to stricter enforcement, we
cannot assure you that our employment practices and policies will at all times be deemed to be
in full compliance with such laws and regulations, which may subject us to labor disputes or
government investigations. If we are deemed to have violated the relevant labor laws and
regulations, we could be subject to related penalties, fines or legal fees, and our business,
financial condition and results of operations could be materially and adversely affected.
Our leased property interests may be defective and our right to lease or use the properties
may be challenged.
Pursuant to applicable PRC laws and regulations, property lease agreements must be filed
with the local branch of the Ministry of Housing and Urban-Rural Development of the PRC.
As of the Latest Practicable Date, our ten leased properties in China had not been registered
with the relevant PRC governmental authorities. According to our PRC Legal Adviser, the
failure to do so does not in itself invalidate the leases, but we may be ordered by the relevant
PRC governmental authorities to rectify such non-compliance and, if we fail to do so within
a given period of time, we may be subject to fines ranging from RMB1,000 and RMB10,000
for each of our unregistered lease agreements. As such, we estimate that the maximum penalty
we might be subject to with respect to these unregistered leased properties as of the Latest
Practicable Date would be approximately RMB100,000. We cannot assure you that we will not
be subject to any penalties arising from the non-registration of our lease agreements and any
disputes arising out of our leased properties in the future.
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Changes in political and economic policies, as well as the interpretation and enforcement
of law, rules and regulations, may affect our business, financial condition, results of
operations and prospects.
Due to our extensive operations in the PRC, our business, financial condition, results of
operations and prospects are affected by political, economic and legal developments in the
PRC. The overall economic growth of PRC is influenced by the governmental regulations and
policies in relation to resource allocation, monetary policies, regulations of financial services
and institutions and others. Any of the foregoing would affect our business, financial condition,
results of operations and prospects.
We shall comply with the applicable PRC laws, rules and regulations. The relevant PRC
laws, rules and regulations in force at present may be amended in the future, and their
interpretation and implementation shall be determined in accordance with relevant laws and
regulations in force at the time. Any non-compliance with any existing or new laws and
regulations could materially and adversely affect our business, financial condition, results of
operations, cash flows and prospects.
Regulations on currency exchange and the fluctuation of currency exchange rate may
adversely affect our business and our ability to pay dividends to holders of our H Shares.
Government authorities in regions where we operate our business regulate the
convertibility and remittance of currencies. Our accounts were denominated in the Renminbi
during the Track Record Period, which is currently convertible under the “current account,”
which includes dividends, trade and service-related foreign exchange transactions, but not
under the “capital account,” which includes foreign direct investment and loans. A portion of
our revenue may be converted into other currencies in order to meet our foreign currency
obligations. For example, we need to obtain foreign currency to make payments of declared
dividends, if any, on our H Shares. Under existing laws and regulations on foreign exchange,
following the completion of the Global Offering, we will be able to make dividend payments
in foreign currencies by complying with certain procedural requirements and without prior
approval from the State Administration of Foreign Exchange, or SAFE, of the PRC. In the
future, the relevant regulatory developments may affect our ability to pay dividends in foreign
currencies to holders of our H Shares.
We are also exposed to foreign currency risk. The value of the Renminbi against the U.S.
dollar and other currencies is affected by a number of factors, such as regulatory updates and
developments in the PRC’s and international political and economic conditions. As all of our
revenue and operating expenses are denominated in Renminbi and the proceeds from the
Global Offering will be received in Hong Kong dollars, any appreciation of the Renminbi
against the U.S. dollar, the Hong Kong dollar or any other currencies may result in the decrease
in the value of our foreign currency denominated assets and our proceeds from the Global
Offering. Conversely, any depreciation of the Renminbi due to fluctuation of the relevant
exchange rates may affect the value of, and any dividends payable on, our H Shares in foreign
currency. In addition, there are limited instruments available for us to reduce our foreign
exchange currency exposure at reasonable costs. We cannot assure you that we will be able to
minimize or reduce our foreign currency risk exposure relating to our foreign currency
denominated assets.
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Y ou may experience difficulties in effecting service of legal process and enforcing
judgments against us and our management.
We are incorporated under the laws of the PRC with limited liability, and substantially all
of our assets are located in the PRC. In addition, substantially all of our executive Directors,
Supervisors and senior management personnel reside within the PRC, and substantially all their
assets are located within the PRC. As a result, it may be difficult for investors to directly effect
service of legal process within the U.S. or elsewhere outside the PRC upon us or our Directors,
Supervisors and senior management personnel.
On July 14, 2006, the Supreme People’s Court of the PRC and the government of Hong
Kong Special Administrative Region entered into the Arrangement on Reciprocal Recognition
and Enforcement of Judgments in Civil and Commercial Matters by the Courts of the Mainland
and of the Hong Kong Special Administrative Region Pursuant to Choice of Court Agreements
between Parties Concerned (ʝႩ̙ձੂБ຅ԫɛ՘ᙄ၍
τર) (the “ Arrangement ”). Under the Arrangement, where any
designated PRC court or any designated Hong Kong court has made an enforceable final
judgment requiring payment of money in a civil or commercial case under a choice of court
agreement in writing, any party concerned may apply to the relevant PRC court or Hong Kong
court for recognition and enforcement of the judgment. A choice of court agreement in writing
is defined as any agreement in writing entered into between parties after the effective date of
the Arrangement in which a Hong Kong court or a PRC court is expressly selected as the court
having sole jurisdiction for the dispute. In addition, the Arrangement has expressly provided
for “enforceable final judgment”, “specific legal relationship” and “written form”. A final
judgment that does not comply with the Arrangement may not be recognized and enforced in
a PRC court.
On January 18, 2019, the Supreme People’s Court of the PRC and the government of the
Hong Kong Special Administrative Region entered into the Arrangement on Reciprocal
Recognition and Enforcement of Judgments in Civil and Commercial Matters by the Courts of
the Mainland and of the Hong Kong Special Administrative Region (݁
τર) (the “ 2019 Arrangement ”), which seeks to
establish a mechanism with greater clarity and certainty for recognition and enforcement of
judgments in wider range of civil and commercial matters between Hong Kong and the PRC.
The 2019 Arrangement discontinued the requirement for a choice of court agreement for
bilateral recognition and enforcement. The 2019 Arrangement will only take effect after the
promulgation of a judicial interpretation by the Supreme People’s Court of the PRC and the
completion of the relevant legislative procedures in Hong Kong. The 2019 Arrangement will,
upon its effectiveness, supersede the Arrangement. Therefore, before the 2019 Arrangement
becomes effective, a choice of court agreement in writing by parties in the dispute remains the
condition precedent for enforcing a judgment rendered by a Hong Kong court in China.
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Gains on the sales of H Shares and dividends on the H Shares may be subject to PRC
income taxes.
Under applicable PRC tax laws, both the dividends we pay to non-PRC resident
individual holders of H shares (“ Non-Resident Individual Holders ”), and gains realized
through the sale or transfer by other means of H shares by such shareholders, are subject to
PRC individual income tax at a rate of 20%, unless reduced by applicable tax treaties or
arrangements. And the dividends we pay to, and gains realized through the sale or transfer by
other means of H shares by non-PRC resident enterprise holders of H shares are both subject
to PRC enterprise income tax at a rate of 10%, unless reduced by applicable tax treaties or
arrangements. In addition, pursuant to the Arrangements between the Mainland and the Hong
Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention
of Fiscal Evasion with Respect to Taxes on Incomes (੻ᒒе
τર) dated August 21, 2006, any non-resident enterprise
registered in Hong Kong that holds directly at least 25% of the shares of our Company shall
pay enterprise income tax for the dividends declared and paid by us at a tax rate of 5%.
With respect to Non-Resident Individual Holders in specific, income received from
dividends and bonuses of a foreign-invested enterprise, as well as that from transfer of stocks
of listed companies are currently exempt from individual income tax pursuant to applicable
PRC regulations. On February 3, 2013, the State Council approved and promulgated the Notice
of Suggestions to Deepen the Reform of System of Income Distribution (ҷ
). On February 8, 2013, the General
Office of the State Council promulgated the Circular Concerning Allocation of Key Works to
Deepen the Reform of System of Income Distribution (ܓ
). According to these two documents, the PRC government is
planning to cancel foreign individuals’ tax exemption for dividends obtained from foreign-
invested enterprises, and the Ministry of Finance and the State Administration of Taxation
should be responsible for making and implementing details of such plan. There is no assurance
that any gains on the sales of our H Shares and the dividend thereon will not be subject to PRC
income taxes in the future.
Our operations are subject to and may be affected by developments in PRC tax laws and
regulations.
We are subject to periodic examinations on fulfillment of our tax obligation under the
PRC tax laws and regulations by the relevant tax authorities. We cannot assure you that future
examinations by such tax authorities would not result in fines, other penalties or actions that
could adversely affect our business, financial condition and results of operations, as well as our
reputation.
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Furthermore, the PRC tax laws and regulations may continue to evolve. For example,
under the amended Individual Income Tax Law which was last amended on August 31, 2018
and came into effect on January 1, 2019, foreign nationals who have no domicile in the PRC
but have resided in the PRC for a total of 183 days or more in a tax year would be subject to
PRC individual income tax on their income gained within or outside the PRC. Should such rule
be strictly enforced, our ability to attract and retain skilled foreign personnel to work in the
PRC may be affected, which may in turn have an adverse effect on our business, financial
condition, results of operations and prospects.
RISKS RELATING TO OUR FINANCIAL POSITION AND NEED FOR ADDITIONAL
CAPITAL
Our ability to continue to enhance our solutions is dependent on adequate research and
development resources. If we are not able to adequately fund our research and
development efforts, we may not be able to compete effectively and our business and
results of operations may be harmed.
During the Track Record Period, our research and development expenses amounted to
RMB36.3 million, RMB64.0 million and RMB98.8 million in 2021, 2022 and 2023,
respectively. As we expect to continue developing new solution offerings and enhance existing
offerings, maintaining adequate research and development personnel and resources to meet the
demand of the market is essential to our business growth. As such, we need to invest significant
resources, including financial resources, in research and development to make technological
advances in order to expand our solution offerings and make our solutions innovative and
competitive in the market. On the other hand, if we are unable to develop solutions,
applications or features due to certain internal constraints, including that on fundings for
research and development activities, we may miss market opportunities. Furthermore, many of
our competitors may expend a considerably greater amount of funds on their research and
development programs, and those that do not may be acquired by larger companies that would
allocate greater resources to such competitors’ research and development programs. Any of our
failures to devote adequate research and development resources or compete effectively with the
research and development programs of our competitors could harm our business and results of
operations. Moreover, we expect that our research and development expenses will continue to
increase in the future. As research and development activities are inherently uncertain and we
might encounter practical difficulties in commercializing our research and development
outcomes, any of our significant expenditures on research and development may not generate
corresponding benefits and negatively impact our financial performance.
RISK FACTORS
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We have historically received government grants, which we may not be able to receive in
the future.
We have historically received government grants as rewards of our contribution to
technological innovations and regional economic development, and encouragement of project
development, which were recognized in the consolidated statements of profit or loss when
related conditions, if any, were satisfied. In 2021, 2022 and 2023, we recognized government
grants as other revenue of RMB7.7 million, RMB11.0 million and RMB27.2 million,
respectively. For details of our government grants, see Note 5 to the Accountants’ Report in
Appendix I to this prospectus. Our eligibility for government grants depends on a variety of
factors, including the assessment of our improvement on existing technologies, relevant
government policies, the availability of funding at different granting authorities and the
research and development progress made by other peer companies. In addition, the timing,
amount and criteria of government grants are determined by the local government authorities
and cannot be influenced by us or predicted with certainty before we actually receive them.
Also, some of the government financial incentives are granted on a project basis and subject
to the satisfaction of certain conditions, including compliance with the applicable financial
incentive agreements and completion of the specific projects therein. We cannot guarantee that
we will satisfy all relevant conditions, and if we fail to satisfy any such conditions, we may
be deprived of the relevant grants. Therefore, the current government grants enjoyed by us have
a non-recurring nature and we cannot assure you of the continued availability of that currently
enjoyed by us. Any reduction or elimination of such government grants would have an adverse
effect on our financial performance and results of operations.
Changes in fair value of our financial assets measured at fair value through profit or loss
(FVPL) may materially and adversely affect our financial condition and results of
operations.
During the Track Record Period, our financial assets measured at FVPL arose from our
strategic investment in a private company incorporated in PRC that primarily engages in the
manufacturing and sales of AI hardware. The investment was classified as financial assets
measured at FVPL because it contains substantive liquidation preference and is redeemable at
our option if the investee is liquidated in the future. As of December 31, 2021, 2022 and 2023,
we recorded such financial assets measured at FVPL of RMB20.0 million, RMB28.3 million
and RMB28.6 million, respectively. In 2021, 2022 and 2023, we recorded changes in fair value
of financial assets measured at FVPL of nil, RMB8.3 million and RMB0.3 million,
respectively.
According to applicable accounting policies, financial assets measured at FVPL are
recorded in the consolidated statements of financial position at fair value, with net changes in
their fair value recognized in the consolidated statements of profit or loss, and therefore
directly affect our financial condition and results of operations. Such treatment of gain or loss
may cause significant volatility in, or materially and adversely affect, our period-to-period
earnings, financial condition and results of operations. We cannot assure you that market
conditions and regulatory environment will create fair value gains and we will not incur any
fair value losses on our financial assets measured at FVPL in the future.
RISK FACTORS
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In addition, estimated changes in fair values involve the exercise of professional
judgment and the use of certain basis and assumptions, which, by their nature, are subjective
and uncertain. To measure fair value of our financial assets measured at FVPL, we use the
assumptions that market participants would use to price the asset or liability acting in their
economic best interest. For more details, see Note 30(e) to the Accountants’ Report in
Appendix I to this prospectus. As such, the financial assets valuation has been, and will
continue to be, subject to uncertainties in accounting estimation, which may not reflect actual
fair value of these financial assets measured at FVPL and result in significant fluctuations in
our profit or loss from period to period. To the extent we need to revalue these financial assets
measured at FVPL, any change in their fair value and related valuation uncertainty could
materially affect our financial condition and results of operations.
We recognized substantial goodwill and intangible assets during the Track Record Period
and may incur significant impairment charges related thereto, which may adversely affect
our results of operations as a result.
As of December 31, 2021, 2022 and 2023, we had goodwill of RMB17.1 million,
RMB39.2 million and RMB39.2 million, respectively. However, our acquired businesses may
not generate the financial results that we expect, which could result in the occurrence of
significant investments and goodwill impairment charges. We periodically review goodwill and
investments for impairment. If we conclude that any of these equity investments and/or
acquired businesses are impaired, we will write down the asset to its fair value and take a
corresponding charge to our consolidated statements of profit or loss. Similarly, we recorded
intangible assets of RMB24.2 million, RMB111.0 million and RMB110.7 million as of
December 31, 2021, 2022 and 2023, respectively, which are reviewed annually to identify any
indication of impairment and the recoverable amount will be estimated if so. As a result, in case
of any significant impairment charges related to the aforementioned assets, our results of
operations may be negatively affected.
We face risks of overstocking or under-stocking inventories.
During the Track Record Period, our inventories primarily included communication
devices, servers and computers, and perception equipment and accessories that were or are to
be integrated into our solutions. As of December 31, 2021, 2022 and 2023, we had inventories
of RMB112.5 million, RMB95.3 million and RMB6.2 million, respectively. Maintaining an
optimal level of inventories is important for the success of our business. We regularly track our
inventories to keep it at a level sufficient to fulfill customers’ orders. We also proactively
assess changes in market conditions and pre-store strategically inventories in anticipation of
potential supply shortage. However, we may be exposed to risks of overstocking or
under-stocking inventories as a result of a variety of factors beyond our control, including
changes of customer needs and the inherent uncertainty of successful solution launches. We
cannot assure you that we can accurately predict these trends and events, or that our inventories
management measures will be implemented effectively so that we will not have significant
levels of inventories excess or shortage. As a result of any unforeseen or sudden events, we
may experience slow movement of our inventories, or fail to utilize our inventories swiftly.
RISK FACTORS
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Moreover, as we plan to continue expanding our solution offerings, we expect to include more
materials in our inventories, which will make it more challenging for us to manage our
inventories effectively. Inventories levels in excess of customer demand may result in
inventories write-downs or an increase in inventories holding costs, and a potential negative
effect on our liquidity. If we fail to manage our inventories effectively, we may also be subject
to a heightened risk of inventories excess or shortage, which may have a material adverse effect
on our business, financial condition and results of operations.
We may be subject to impairment losses on our prepayments.
As of December 31, 2021, 2022 and 2023, we recorded prepayments of RMB168.2
million, RMB173.6 million and RMB413.8 million, respectively. During the Track Record
Period, our prepayments primarily represented our prepayments for goods and services and for
purchase of property, equipment and intangible assets. We may be subject to impairment losses
on our prepayments if the actual recoverability of such prepayments is lower than the expected
level, which could adversely affect our cash flow and our ability to meet our working capital
requirements, thereby adversely affecting our business, financial condition and results of
operations.
If we fail to fulfill our obligations in respect of our contract liabilities, our results of
operations, liquidity and financial position may be adversely affected.
As of December 31, 2021, 2022 and 2023, we had contract liabilities of RMB26.7 million,
RMB31.1 million and RMB97.4 million, respectively, which were primarily due to the advance
payments received from our customers for solutions and services to be provided during a
period of time in the future. As our recognition of contract liabilities as revenue is subject to
future performance obligations, they may not be representative of our revenue for future
periods. In addition, there is no assurance that we will be able to fulfill our obligations in
respect of contract liabilities as the completion of the sales of our solutions is subject to various
factors, including the availability of relevant personnel and the supply of equipment from our
third-party suppliers, among others. If we are not able to fulfill our obligations with respect to
our contract liabilities, customers may request to cancel their agreements with us and we may
need to refund a portion or all of our contract liabilities not yet recognized as revenue to our
customers, which could result in an adverse impact on our cash flows generated from operating
activities and liquidity, and also lead to customer dissatisfaction or even disputes with us. In
the event that we are required to refund some or all of the prepayments from our customers,
we may not have the cash or other available resources to fulfill the refund obligation.
Furthermore, if we fail to fulfill our obligations with respect to our contract liabilities,
customers may request not to prepay us in the future, in which case we would have to find other
sources of funding for our operations, capital expenditures and expansion plans, which would
be costly as compared to the aforementioned cost-free customer prepayment funding and may
not be available when needed or on acceptable terms, if at all. Any failure to fulfill our
obligations in respect of contract liabilities may have an adverse impact on our results of
operations, liquidity and financial position.
RISK FACTORS
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Our financial condition and results of operations may be adversely affected by changes in
carrying amount of redeemable capital contributions, including due to the valuation
uncertainty in association with the use of unobservable inputs.
As of December 31, 2021, 2022 and 2023, the redeemable capital contributions from our
existing investors amounted to RMB265.7 million, RMB528.0 million and RMB852.9 million,
respectively. In 2021, 2022 and 2023, changes in carrying amount of such redeemable capital
contributions amounted to RMB26.0 million, RMB157.5 million and RMB146.9 million,
respectively. According to applicable accounting policies, such redeemable capital
contributions are recorded in the consolidated statements of financial position, with changes in
their fair value recognized in the consolidated statements of profit or loss, therefore directly
affecting our financial condition and results of operations.
The determination of changes in carrying amount of such redeemable capital
contributions requires the use of estimates that are based on significant unobservable inputs,
such as discounts for lack of marketability and discount rate. For details, see Note 26 and Note
30(e) to the Accountants’ Report in Appendix I to this prospectus. Such unobservable inputs
require us to make significant estimates, which may be subject to material changes, and
therefore inherently involve a certain degree of uncertainty. For instance, factors beyond our
control can significantly influence and cause adverse changes to the estimates we use and
thereby affect the fair value of such liabilities. These factors include, but are not limited to,
general economic condition, changes in market interest rates and stability of the capital
markets. Any of these factors, as well as others, could cause our estimates to vary from actual
results, which could materially and adversely affect our financial condition and results of
operations.
We had net current liabilities during the Track Record Period, which may adversely affect
our liquidity.
During the Track Record Period, we had net current liabilities of RMB33.6 million as of
December 31, 2021, RMB242.6 million as of December 31, 2022 and RMB455.9 million as of
December 31, 2023, which were primarily attributable to the significant amount of redeemable
capital contributions in relation to equity investments in connection with the redemption rights
and liquidation preferences by the relevant investors in certain situations. For details, see
“Financial Information – Discussion of Selected Items from Consolidated Statements of
Financial Position – Redeemable Capital Contributions” in this prospectus. For details of risks
related thereto, see “– Our financial condition and results of operations may be adversely
affected by changes in carrying amount of redeemable capital contributions, including due to
the valuation uncertainty in association with the use of unobservable inputs” in this section.
We cannot guarantee that we will not continue to incur net current liabilities in the future.
If we are to record net current liabilities again, it will affect our liquidity, as well as our ability
to raise funds, obtain bank loans, pay debts when they become due and declare and pay
dividends. Specifically, our liquidity position may also be adversely affected by our failure to
fulfill our obligations in respect of our contract liabilities if we experience a shortage in cash
flow generated from operations. This, in turn, may impact our ability to execute our business
strategies. For details, see “– If we fail to fulfill our obligations in respect of our contract
liabilities, our results of operations, liquidity and financial position may be adversely affected”
in this section. If such event occurs, our results of operations and financial position will be
materially and adversely affected.
RISK FACTORS
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We had net loss for the year 2022 and 2023 and net cash flows used in operating activities
during the Track Record Period, and may need to obtain additional financing to fund our
operations, which may cause dilution to our Shareholders and restrict our operations, and
we may not be able to obtain additional financing on favorable terms or at all.
In 2022 and 2023, we recorded net loss for the year of RMB85.8 million and RMB29.2
million, respectively, which was primarily attributable to changes in carrying amount of our
redeemable capital contributions of RMB157.5 million and RMB146.9 million in the same
year, respectively. Moreover, in 2021, 2022 and 2023, we recorded net cash used in operating
activities of RMB75.1 million, RMB31.1 million and RMB68.1 million, respectively. We
expect to continue to spend substantial amounts of capital on conducting research and
development activities, commercializing our solutions and responding to unforeseen
circumstances. We believe that our future abilities to achieve and maintain stable profitability
and generate positive operating cashflow will depend on, among other factors, our ability to
develop new technologies, enhance customer experience, establish effective monetization
strategies, compete effectively and successfully, and continuously grow our customers base and
revenues in a cost-effective way. However, the foregoing efforts may take a long time to realize
returns, and we may therefore continue to have net losses and net cash outflows from operating
activities in the future. We have historically funded our cash requirements additionally with
capital contribution from shareholders and financing through the issuance of shares in private
placement transactions. In the event that our existing capital resources fail to sufficiently cover
our overall cash needs, we will need further funding through public or private offerings, debt
financing, governmental subsidies, and/or other sources. We cannot assure you that we will be
able to secure sufficient financial resources to support our operations. Our future funding
requirements will depend on many factors, including:
 our future liquidity, payment of trade and other payables, capital expenditure plans
and repayment of outstanding debt obligations;
 cash requirements of the research and development of our technologies and
solutions;
 the terms and timing of any future acquisitions;
 the costs of filing, prosecuting, defending and enforcing any patent claims, trade
secret and other intellectual property rights;
 our headcount growth and associated costs; and/or
 selling and marketing costs associated with our solutions, including the costs and
timing of expanding our sales and marketing team.
RISK FACTORS
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We cannot assure you that we will have sufficient financing from other sources to fund
our operations. Our ability to obtain additional capital is subject to a variety of uncertainties,
including:
 our market position and competitiveness in the industry in which we operate;
 our future profitability, overall financial condition, results of operations and cash
flows;
 general market conditions for capital-raising activities in China;
 overall conditions of the market for conversational AI solutions in China; and
 economic, political and other conditions in China and internationally.
If we are unable to raise capital when needed, we would be forced to delay, reduce or
eliminate our research and development programs or future commercialization efforts, which
may materially and adversely affect our continued business operations.
Even if we resort to other financing activities, we may not be able to obtain the financing
on terms acceptable to us with respect to financing costs and other commercial terms. If we
raise additional capital through the sale of equity or convertible debt securities, your ownership
interest will be diluted, and the terms may include liquidation or other preferences that
adversely affect your rights as a holder of our H Shares. The incurrence of additional
indebtedness or the issuance of certain equity securities could result in increased fixed payment
obligations and could also result in certain additional restrictive covenants, such as limitations
on our ability to incur additional debt or issue additional equity, as well as other operating
restrictions that could adversely impact our ability to conduct our business. In addition,
issuance of additional equity securities, or the possibility of such issuance, may cause the
market price of our H Shares to decline.
RISKS RELATING TO OUR GENERAL OPERATIONS
Rumors or negative publicity involving us, our solutions, management, customers, or
business partners may materially and adversely affect our reputation, business, results of
operations and financial condition.
We believe that positive publicity about us plays an important role in achieving
widespread acceptance of our solutions as well as strengthening our ability to maintain and
attract our customers. Negative publicity or citation involving us, our solutions, management,
customers or business partners may on the other hand harm our reputation and business. We
cannot assure you that we will be able to preclude any future negative media reports, defuse
such negative publicity or citation to the satisfaction of our investors, customers and business
partners, or prevent consequential misconception and other damages caused thereby. In
addition, we may have to incur significant expenses and divert our management’s time and
attention in order to remedy the effects of such negative coverage, which may materially and
adversely affect our business, results of operations and financial condition.
RISK FACTORS
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We may be involved in legal proceedings and commercial disputes, which could have a
material adverse effect on our business, financial condition and results of operations.
We may be subject to claims or disputes of various types brought by our competitors,
employees, customers or others against us relating to contractual disputes, labor disputes,
intellectual property infringements, misconduct of our employees or others. Such claims and
disputes may evolve into litigations which could be costly and time-consuming, distracting to
our management and detrimental to our reputation, thereby adversely affecting our customer
base. In addition, one or more legal or administrative matters resolved against us could result
in significant compensatory, punitive or trebled monetary damages, disgorgement of revenue
or profits, remedial corporate measures, injunctive relief or specific performance that could
materially and adversely affect our business, financial condition and results of operations.
Our insurance coverage may be limited and expose us to significant costs and business
disruption.
We face various risks in connection with our business, and we believe we maintain
insurance policies in line with industry standards. However, we may still lack adequate
insurance coverage or have no relevant insurance coverage. We may also be unable to insure
certain risks related to our assets or business even if we desire to. Any uninsured occurrence
of business disruption, litigation or natural disaster, or significant damages to our uninsured
equipment or facilities could result in our incurrence of substantial costs and diversion of
resources, which could have a material adverse effect on our business operations. In addition,
there is no certainty that we will be able to successfully claim our losses under our current
insurance policy 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.
Failure to renew our current leases at reasonable terms or to locate desirable alternatives
for our offices and facilities could materially and adversely affect our business and results
of operations.
There is no assurance that our existing leases would be successfully extended or renewed
on similar or favorable terms, in particular with respect to the amount of rent and the term of
the lease, or at all. Any substantial increase in the rent due to high demand for the leased
properties at certain locations or of desirable sizes, for instance, may increase our property
rental and related expenses, which could materially and adversely affect our profitability. If we
are unable to renew our lease agreements upon their expirations, we will have to relocate the
affected operations, which could disrupt our business and result in significant relocation
expenses. We could not assure you that we would be able to secure comparable locations with
leases based on comparable terms to relocate our affected operations in time, or at all,
especially when our leases were to be terminated early by the lessors before the expiry of the
relevant term, and as a result our business and results of operations may be material adversely
affected.
RISK FACTORS
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We face risks related to force majeure events, natural disasters, health epidemics and
other outbreaks of contagious diseases.
Our business could be affected by force majeure events, natural disasters, or other adverse
public health developments, such as snowstorms, earthquakes, fires or floods, the outbreak of
a widespread health epidemic, including the Severe Acute Respiratory Syndrome or SARS, the
H5N1 avian flu, the human swine flu, also known as Influenza A (H1N1) and COVID-19 and
its variants, or other events, such as wars, acts of terrorism, environmental accidents, power
shortage or communication interruptions. Any natural disasters, epidemics and other outbreaks
that are beyond our control may be expected to affect the economy, restrict the level of business
activities in the affected areas and directly impact our and our customers’ operations, including
straining facilities and employees, exposing employees to personal risks, temporarily closing
office spaces, imposing additional health or safety measures upon office spaces, or exposing
us to potential liabilities for actions taken or not taken.
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, and the price and trading volume of our H Shares
may be volatile.
Prior to this Global Offering, there has been no public market for our H Shares. The Offer
Price for our Offer Shares was the result of negotiations among us and Sole Overall
Coordinator (for itself and on behalf of the Underwriters) and the Offer Price may differ
significantly from the market price for our H Shares following this Global Offering. We have
applied for listing of and permission to deal in our Offer Shares on the Stock Exchange.
A listing on the Stock Exchange, however, does not guarantee that an active and liquid
trading market for the H Shares will develop, or if it does develop, that it will be sustained
following the Global Offering, or that the market price of the H Shares will not decline
following the Global Offering. In addition, the trading price and trading volume of the H
Shares may be subject to significant volatility in responses to various factors beyond our
control, including the general market conditions of the securities in Hong Kong and elsewhere
in the world. In particular, the business and performance and the market price of the shares of
other companies engaging in similar business may affect the price and trading volume of our
H Shares. In addition to market and industry factors, the price and trading volume of our H
Shares may be highly volatile for specific business reasons, such as regulatory developments
affecting the relevant markets, industries and other related matters, fluctuations in our revenue,
earnings, cash flows, investments and expenditures, relationships with our suppliers,
movements or activities of key personnel, or actions taken by competitors.
RISK FACTORS
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Future sales or perceived sales of a substantial number of our H Shares in the public
market following the Global Offering could materially and adversely affect the price of
our H Shares and our ability to raise additional capital in the future.
Prior to the Global Offering, there has not been a public market for our H Shares. Future
sales or perceived sales by our existing Shareholders of our H Shares after the Global Offering
could result in a significant decrease in the prevailing market price of our H Shares. Only a
limited number of the Shares currently outstanding will be available for sale or issuance
immediately after the Global Offering due to contractual and regulatory restrictions on disposal
and new issuance. Nevertheless, after these restrictions lapse or if they are waived, future sales
of significant amounts of our H Shares in the public market or the perception that these sales
may occur could significantly decrease the prevailing market price of our H Shares and our
ability to raise equity capital in the future.
Y ou will incur immediate and significant dilution and raising additional capital may cause
further dilution or restrict our operation.
The Offer Price of the Offer Shares is higher than the net tangible asset value per H 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 our Shareholders after the creditors’ claims. If we
raise additional capital through the sale of equity or convertible debt securities, your ownership
interest will be diluted, and the terms of these securities may include liquidation or other
preferences that adversely affect your rights as a shareholder. Debt financing and preferred
equity financing, if available, may involve agreements that include covenants limiting or
restricting our ability to take specific actions, such as incurring additional debt, making capital
expenditures, limitations on our ability to acquire or license intellectual property rights or
declaring dividends, or other operating restrictions.
We cannot assure you that we will declare and distribute any amount of dividends in the
future.
There can be no assurance that we will declare and pay dividends because the declaration,
payment and amount of dividends are subject to the discretion of our Directors, depending on,
among other considerations, our operations, earnings, cash flows and financial position,
operating and capital expenditure requirements, our strategic plans and prospects for business
development, our constitutional documents and applicable law. For more details on our
dividend policy, see “Financial Information – Dividend” in this prospectus.
RISK FACTORS
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The future conversion of Unlisted Shares into H Shares upon completion of the Global
Offering could increase the supply of H Shares in the market and may negatively impact
the market price of our H Shares.
Our Unlisted Shares are currently not listed or traded on any stock exchange. We have
applied for the conversion of Unlisted Shares into H Shares. The conversion of Unlisted Shares
into H Shares has been approved by the CSRC on March 8, 2024. Upon completion of the
Global Offering, these Unlisted Shares will be converted into H Shares on a one-for-one basis.
For details, see “History, Development and Corporate Structure” and “Share Capital –
Conversion of Unlisted Shares into H Shares” in this prospectus. The conversion of our
Unlisted Shares will increase the number of H Shares available on the market. As a result, it
may negatively affect the trading price of our H Shares due to the increased supply in the
market.
Our Controlling Shareholders has significant influence over our Company and their
interests may not be aligned with the interest of our other Shareholders.
Our Controlling Shareholders will, through their voting power at the Shareholders’
meetings and delegates on the Board, have significant influence over our business and affairs,
including decisions in respect of mergers or other business combinations, acquisition or
disposition of assets, issuance of additional shares or other equity securities, timing and
amount of dividend payments, and our management. Our Controlling Shareholders may not act
in the best interests of our minority Shareholders. In addition, without the consent of our
Controlling Shareholders, we could be prevented from entering into transactions that could be
beneficial to us. This concentration of ownership may also discourage, delay or prevent a
change in control of our Company, which could deprive our Shareholders of an opportunity to
receive a premium for the Shares as part of a sale of our Company and may significantly reduce
the price of our Shares.
We have not independently verified government statistics and facts in this prospectus.
This prospectus includes certain statistics that have been extracted from relevant
government official sources and publications. Our Directors believe the sources of these
statistics are appropriate for such statistics and have taken reasonable care in extracting and
reproducing such statistics. Our Directors have no reason to believe that such statistics are false
or misleading or that any fact has been omitted that would render such statistics false or
misleading. However, these statistics from these sources have not been independently verified
by our Company, the Sole Sponsor, the Sole Overall Coordinator, the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers or the Underwriters, any of their
respective directors or any other parties involved in the Global Offering and therefore, our
Company makes no representation as to the accuracy or completeness of these statistics, which
may not be consistent with other information compiled within or outside Hong Kong.
Furthermore, there is no assurance that they are stated or compiled on the same basis, or with
the same degree of accuracy, as similar statistics presented elsewhere. In all cases, investors
should give consideration as to how much weight or importance they should attach to or place
on such statistics or facts.
RISK FACTORS
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Y ou should read the entire prospectus carefully, and we strongly caution you not to place
any reliance on any information contained in press articles or other media regarding us
or the Global Offering.
You should rely solely upon the information contained in this prospectus, the Global
Offering and any formal announcements made by us in Hong Kong when making your
investment decision regarding our H Shares. Subsequent to the date of this prospectus but prior
to the completion of the Global Offering, there may be press and media coverage regarding us
and the Global Offering, which may contain, among other things, certain financial information,
projections, valuations and other forward-looking information about us and the Global
Offering. We have not authorized the disclosure of any such information in the press or media
and do not accept any responsibility for the accuracy or completeness of any such press articles
or other media coverage, nor the fairness or appropriateness of any forecasts, views or opinions
expressed by the press or other media regarding our H Shares, the Global Offering or us. 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 in any such press
articles or media coverage. Accordingly, prospective investors are cautioned to make their
investment decisions on the basis of the information contained in this prospectus only and
should not rely on any other information. By applying to purchase our H Shares in the Global
Offering, you will be deemed to have agreed that you will not rely on any information other
than that contained in this prospectus.
RISK FACTORS
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--- page 109 ---
DIRECTORS’ RESPONSIBILITY FOR THE CONTENTS OF THIS PROSPECTUS
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
(Cap 571V of the Laws of Hong Kong) and the Listing Rules for the purpose of giving
information to the public with regard to us. 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 in
this prospectus misleading or deceptive.
UNDERWRITING AND INFORMATION ON THE GLOBAL OFFERING
This prospectus is published solely in connection with the Hong Kong Public Offering,
which forms part of the Global Offering.
The Listing of our H Shares on the Stock Exchange 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 pursuant to the Hong Kong
Underwriting Agreement under the terms of the Hong Kong Underwriting Agreement on a
conditional basis. The International Offering is expected to be fully underwritten by the
International Underwriters under the terms of the International Underwriting Agreement
relating to the International 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 and therein must not be relied upon as
having been authorized by our Company, the Sole Sponsor, the Sole Overall Coordinator, the
Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Underwriters,
any of their respective directors, officers, employees, partners, agents, employees or advisers
or any other party involved in the Global Offering.
Neither the delivery of this prospectus nor any subscription or acquisition made under it
shall, 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.
Further information regarding the structure of the Global Offering, including its
conditions, are set out in the section headed “Structure of the Global Offering”, and the
procedures for applying for our Hong Kong Offer Shares are set out in the section headed “How
to Apply for Hong Kong Offer Shares” in this prospectus.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 110 ---
RESTRICTIONS ON OFFER AND SALE OF THE OFFER SHARES
Each person acquiring the H Shares under the Hong Kong Public Offering will be
required to, or be deemed by his/her acquisition of the Hong Kong Offer Shares to, confirm that
he/she is aware of the restrictions on offers and sales of the H Shares described in this
prospectus.
No action has been taken to permit a public offering of the H Shares in any jurisdiction
other than Hong Kong, and no action has been taken to permit the distribution of this
prospectus in any jurisdiction other than Hong Kong. Accordingly, without limitation to the
following, this prospectus may not be used for the purpose 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 and sales 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. In particular, the H
Shares have not been publicly offered or sold, directly or indirectly, in the PRC or the United
States.
INFORMATION ON THE CONVERSION OF UNLISTED SHARES INTO H SHARES
The Company has applied for the Conversion of Unlisted Shares into H Shares, which
involves 8,625,913 Shares held by 30 Shareholders. The Conversion of Unlisted Shares into H
Shares has been approved by CSRC on March 8, 2024. Please see “History, Development and
Corporate Structure” and “Share Capital” in this prospectus for further details of the
aforementioned Shareholders and their interests in the Company and relevant procedures for
the Conversion of Unlisted Shares into H Shares. Such H Shares are restricted from trading for
a period of one year after the Listing pursuant to the PRC Company Law.
APPLICATION FOR LISTING OF THE H SHARES ON THE STOCK EXCHANGE
We have applied to the Listing Committee for the granting of the listing of, and
permission to deal in, (i) the H Shares to be issued by us pursuant to the Global Offering
(including any H Shares which may be issued pursuant to the exercise of the Over-allotment
Option); and (ii) the H Shares to be converted from our Unlisted Shares.
Dealings in the H Shares on the Stock Exchange are expected to commence on
Wednesday, July 10, 2024. No part of our Shares or loan capital is listed or dealt in on any other
stock exchange and no such listing or permission to list is being or proposed to be sought on
any other stock exchange as of the date of this prospectus. All the Offer Shares will be
registered on the Hong Kong register of members of the Company in order to enable them to
be traded on the Stock Exchange.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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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, our H Shares on the Stock Exchange pursuant to this prospectus has
been refused before the expiration of three weeks from the date of the closing of the application
lists, or such longer period (not exceeding six weeks) as may, within the said three weeks, be
notified to the Company by or on behalf of the Stock Exchange.
PROFESSIONAL TAX ADVICE RECOMMENDED
Potential investors in the Global Offering are recommended to consult their professional
advisers as to the taxation implications of subscribing for, purchasing, holding or disposal of,
and/or dealing in the H Shares or exercising rights attached to them. None of us, the Sole
Sponsor, the Sole Overall Coordinator, the Joint Global Coordinators, the Joint Bookrunners,
the Joint Lead Managers, the Underwriters, any of their respective directors, officers,
employees, partners, agents, advisers or representatives or any other person or party involved
in the Global Offering accepts responsibility for any tax effects on, or liabilities of, any person
resulting from the subscription, purchasing, holding, disposition of, or dealing in, the H Shares
or exercising any rights attached to them.
OVER-ALLOTMENT OPTION AND STABILIZATION
Details of the arrangements relating to the Over-allotment Option and stabilization are set
out in “Underwriting” and “Structure of the Global Offering” in this prospectus.
H SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
Subject to the granting of the listing of, and permission to deal in, the H Shares on the
Stock Exchange and compliance 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 on the Stock
Exchange or on 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.
All necessary arrangements have been made enabling the H Shares to be admitted into
CCASS. Investors should seek the advice of their stockbrokers or other professional advisers
for details of the settlement arrangements as such arrangements may affect their rights and
interests.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 112 ---
REGISTRATION OF SUBSCRIPTION, PURCHASE AND TRANSFER OF H SHARES
We have instructed the H Share Registrar, and the H Share Registrar has agreed, not to
register the subscription, purchase or transfer of any H Shares in the name of any particular
holder unless the holder delivers a signed form to the H Share Registrar in respect of those H
Shares bearing statements to the effect that the holder:
(1) agrees with us and each of our Shareholders, and we agree with each Shareholder,
to observe and comply with the PRC Company Law, the Companies Ordinance, the
Companies (Winding Up and Miscellaneous Provisions) Ordinance, the Special
Regulations and our Articles of Association;
(2) agrees with us, each of our Shareholders, Directors, Supervisors, managers and
officers, and we, acting for ourselves and for each of our Directors, Supervisors,
managers and officers agree with each Shareholder, to refer all differences and
claims arising from our Articles of Association or any rights or obligations conferred
or imposed by the PRC Company Law or other relevant laws and administrative
regulations concerning our affairs to arbitration in accordance with our Articles of
Association, and any reference to arbitration shall be deemed to authorize the
arbitration tribunal to conduct hearings in open session and to publish its award,
which shall be final and conclusive;
(3) agrees with us and each of our Shareholders that our H Shares are freely transferable
by the holders thereof; and
(4) authorizes us to enter into a contract on his or her behalf with each of our Directors,
Supervisors, managers and officers whereby such Directors, Supervisors, managers
and officers undertake to observe and comply with their obligations to our
Shareholders as stipulated in our Articles of Association.
PROCEDURES FOR APPLICATION FOR HONG KONG OFFER SHARES
The procedures for applying for Hong Kong Offer Shares are set out in the section headed
“How to Apply for the Hong Kong Offer Shares” in this prospectus.
H SHARE REGISTER AND STAMP DUTY
All of the Offer Shares issued pursuant to applications made in the Global Offering and
the H Shares converted from the Unlisted Shares will be registered on the H Share register of
members of our Company maintained by our H Share Registrar, Computershare Hong Kong
Investor Services Limited, in Hong Kong. Our register of members will also be maintained by
us at our legal address in the PRC.
Dealings in the H Shares registered on the H Share register of members of our Company
in Hong Kong will be subject to Hong Kong stamp duty.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 113 ---
DIVIDENDS PAYABLE TO HOLDERS OF H SHARES
Unless determined otherwise by our Company, dividends payable in respect of our H
Shares will be paid to the Shareholders listed on the H Share register of our Company in Hong
Kong, by ordinary post, at the Shareholders’ risk, to the registered address of each Shareholder
of our Company.
STRUCTURE OF THE GLOBAL OFFERING
Details of the structure of the Global Offering, including its conditions, are set out in the
section headed “Structure of the Global Offering” in this prospectus.
EXCHANGE RATE CONVERSION
Solely for your convenience, this prospectus contains translations among certain amounts
denominated in Renminbi, Hong Kong dollars and U.S. dollars. No representation is made that
the amounts denominated in one currency could actually be converted into the amounts
denominated in another currency at the rates indicated or at all. Unless indicated otherwise, (i)
the translations between Renminbi and U.S. dollars were made at the rate of RMB7.1192 to
US$1.00, (ii) the translations between U.S. dollars and Hong Kong dollars were made at the
rate of HK$7.8062 to US$1.00. Any discrepancies in any table between totals and sums of
amounts listed therein are due to rounding.
LANGUAGE
If there is any inconsistency between this prospectus and the Chinese translation of this
prospectus, this prospectus shall prevail. However, the English names of the PRC nationals,
entities, departments, facilities, certificates, titles, laws, regulations and the like are
translations of their Chinese names and are included for identification purposes only. If there
is any inconsistency, the Chinese name prevails.
ROUNDING AND OTHERS
Certain amounts and percentage figures included in this prospectus have been subject to
rounding adjustments, or have been rounded to one or two decimal places. Any discrepancies
in any table, chart or elsewhere between totals and sums of amounts listed therein are due to
rounding.
Unless otherwise specified, all references to any shareholdings in our Company following
the completion of the Global Offering assume that the Over-allotment Option is not exercise.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 114 ---
In preparation for the Global Offering, our Company has sought and has been granted the
following waivers from strict compliance with the relevant provisions of the Listing Rules:
W AIVER IN RELATION TO MANAGEMENT PRESENCE IN HONG KONG
Pursuant to Rule 8.12 and Rule 19A.15 of the Listing Rules, we must have a sufficient
management presence in Hong Kong. This normally means that at least two of our executive
Directors must be ordinarily resident in Hong Kong.
Our management, business operations and assets are primarily located outside Hong
Kong. The principal management headquarters of our Group are primarily based in the PRC.
Our Company considers that our Group’s management is best able to attend to its functions by
being based in the PRC. None of our executive Directors is or will be ordinarily resident in
Hong Kong after the Listing of our Company. Our Directors consider that relocation of our
executive Directors to Hong Kong will be burdensome and costly for our Company, and it may
not be in the best interests of our Company and our Shareholders as a whole to appoint
additional executive Directors who are ordinarily resident in Hong Kong. As such, we do not
have, and for the foreseeable future will not have, sufficient management presence in Hong
Kong for the purpose of satisfying the requirements under Rule 8.12 and Rule 19A.15 of the
Listing Rules.
Accordingly, 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 8.12 and Rule
19A.15 of the Listing Rules, provided that our Company implements the following
arrangements to maintain effective communication between the Stock Exchange and us:
(1) pursuant to Rule 3.05 of the Listing Rules, the Company has appointed and will
continue to maintain two authorized representatives, namely, Mr. Tang and Ms. Liu
Yihan, being respectively an executive Director and a joint company secretary of our
Company, to be the principal communication channel at all times between the Stock
Exchange and the Company. Each of the Company’s authorized representatives will
be available to meet with the Stock Exchange within a reasonable time frame upon
the request of the Stock Exchange and will be readily contactable by telephone,
facsimile and email;
(2) as and when the Stock Exchange wishes to contact our Directors on any matters,
each of our authorized representatives has the means to contact all of our Directors
(including the independent non-executive Directors) promptly at all times;
(3) although our executive Directors do not ordinarily reside in Hong Kong, each of our
Directors not ordinarily residing in Hong Kong possesses or can apply for valid
travel documents to visit Hong Kong and is able to meet with the Stock Exchange
within a reasonable period of time, when required;
W AIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
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--- page 115 ---
(4) we have appointed Maxa Capital Limited as our compliance advisor (the
“Compliance Advisor ”), pursuant to Rule 3A.19 of the Listing Rules, who will have
access at all times to our authorized representatives, Directors and senior
management, and will act as an additional channel of communication between the
Stock Exchange and us for the period commencing from the Listing Date to the date
on which our Company complies with Rule 13.46 of the Listing Rules in respect of
its financial results for the first full financial year commencing after the Listing
Date. The Compliance Advisor will maintain constant contact with the authorized
representatives, Directors and senior management through various means, including
regular meetings and telephone discussions whenever necessary. Our authorized
representatives, Directors and other officers of our Company will provide promptly
such information and assistance as the Compliance Advisor may reasonably require
in connection with the performance of the Compliance Advisor’s duties as set forth
in Chapter 3A of the Listing Rules;
(5) we have provided the Stock Exchange with the contact details of each Director
(including their respective mobile phone number, office phone number and e-mail
address), and in the event that any Director expects to travel or otherwise be out of
the office, he will provide the phone number of the place of his accommodation to
the authorized representatives; and
(6) we will also retain legal advisers to advise on on-going compliance requirements as
well as other issues arising under the Listing Rules and other applicable laws and
regulations of Hong Kong after Listing.
W AIVER IN RESPECT OF JOINT COMPANY SECRETARIES
Pursuant to Rule 8.17 of the Listing Rules, an issuer 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 the company secretary of our Company
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.
Note 1 to Rule 3.28 of the Listing Rules provides that the Stock Exchange considers that
the following academic or professional qualifications to be acceptable:
(a) a member of The Hong Kong Institute of Chartered Secretaries;
(b) a solicitor or barrister (as defined in the Legal Practitioners Ordinance); or
(c) a certified public accountant (as defined in the Professional Accountants
Ordinance).
W AIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
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--- page 116 ---
Note 2 to Rule 3.28 of the Listing Rules provides that in assessing “relevant experience”,
the Stock Exchange will consider the individual’s:
(a) length of employment with the Company and other listed companies and the roles
he/she played;
(b) familiarity with the Listing Rules and other relevant law and regulations including
the Securities and Futures Ordinance, the Companies Ordinance, the Companies
(Winding Up and Miscellaneous Provisions) Ordinance and the Takeovers Code;
(c) relevant training taken and/or to be taken in addition to the minimum requirement
of taking not less than fifteen hours of relevant professional training in each
financial year under Rule 3.29 of the Listing Rules; and
(d) professional qualifications in other jurisdictions.
Our Company considers that while it is important for the company secretary to be familiar
with the relevant securities regulation in Hong Kong, he/she also needs to have experience
relevant to our Company’s operations, nexus to the Board and close working relationship with
the management of our Company in order to perform the function of a company secretary and
to take the necessary actions in the most effective and efficient manner. It is for the benefit of
our Company to appoint a person who has been a member of the senior management for a
period of time and is familiar with our Company’s business and affairs as company secretary.
We have appointed Ms. Liu Yihan (“ Ms. Liu ”) and Mr. Cheung Kai Cheong Willie (“ Mr.
Cheung ”) as the joint company secretaries of our Company. Mr. Cheung is a fellow member
of the Hong Kong Institute of Certified Public Accountants and the Association of Chartered
Certified Accountants in the United Kingdom, and 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. Ms. Liu, however, does not possess the qualifications set out in Rule
3.28 of the Listing Rules. We believe that Ms. Liu, by virtue of her knowledge and experience
in handling financial management and corporate development matters, is capable of
discharging her functions as a joint company secretary. We therefore believe that it would be
the best interests of our Company and of the corporate governance of our Group to appoint Ms.
Liu as a joint company secretary. For more details of Ms. Liu and Mr. Cheung’s biographical
information, see “Directors, Supervisors and Senior Management” in this prospectus.
We have therefore applied to the Stock Exchange for, and the Stock Exchange has granted
us, a waiver from strict compliance with the requirements under Rules 3.28 and 8.17 of the
Listing Rules on the conditions that: (i) Ms. Liu must be assisted by Mr. Cheung, 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 will
be revoked if there are material breaches of the Listing Rules by our Company. We expect that
Ms. Liu will acquire the qualifications or relevant experience required under Rule 3.28 of the
Listing Rules prior to the end of the three-year period after the Listing. We will liaise with the
W AIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
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--- page 117 ---
Stock Exchange before the end of the three-year period to enable it to assess whether Ms. Liu,
having had the benefit of Mr. Cheung’s assistance for three years and has acquired relevant
experience within the meaning of Rule 3.28 of the Listing Rules so that a further waiver will
not be necessary.
W AIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
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DIRECTORS
Name Address Nationality
Executive Directors
Mr. Tang Jinghua ( ಷหശ) Room 1701, No.17,
Chunshen Jingcheng II, Lane 1199,
Xingmei Road, Minhang District,
Shanghai
Chinese
Mr. Sun Qi (೘) Room 301, No.501, Lane 1088,
Xin Nan Road, Song Jiang District,
Shanghai
Chinese
Non-executive Directors
Mr. Yang Xiaoyuan ( เወ๕) No.186, Lane 99, Wending Road,
Minhang District, Shanghai
Chinese
Mr. Tan Xiaobo (تRoom 503, Building 3, No.188
Tongzhou Road, Hongkou District,
Shanghai
Chinese
Mr. Chen Yulei ( ௓ρཤ) Room 102, No.1, Lane 38,
Zhongcao Road, Xuhui District,
Shanghai
Chinese
Ms. Ma Tiantian ( ৵˂૴) Room 1903, No.5, Baohua City Star,
Lane 18, Shiquan Road, Shanghai
Chinese
Independent non-executive
Directors
Mr. Liu Rong ( ᄎ࿰) No.8, Lane 999, Zhaojiabang Road,
Xuhui District, Shanghai
Chinese
Mr. Wu Haipeng ( юऎᘄ) Duplex Unit 503, Building 30,
Mingzhu Garden,
No.197 Minjiang Avenue,
Jinshan Street,
Cangshan District,
Fuzhou City, Fujian Province
Chinese
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 119 ---
Name Address Nationality
Mr. Mu Binrui ( ϳⅳ๿) Room 101, No.8, Lane 789,
Yingkou Road, Yangpu District,
Shanghai
Chinese
Mr. Sinn Wai Kin Derek
(ᤑਃ਄)
Flat D, 5/F, Tower 21,
23 Fo Chun Road,
Mayfair by the Sea,
I Pak Shek Kok, Tai Po,
New Territories
Chinese
SUPERVISORS
Name Address Nationality
Ms. Wu Yongzheng (݁Room 502, No.49, Lane 277, Guoding
Road, Shanghai
Chinese
Ms. Xu Xiaodi (ࠔRoom 502, No. 171, Lane 1200,
Qianxin Road, Sheshan Town,
Songjiang District, Shanghai
Chinese
Mr. Xiao Dong (؇Room 1903, Building 11,
Changfahaojun Garden, No. 233 Xingpu
Road, Lujia Town, Kunshan City,
Jiangsu Province
Chinese
For details of the biographies and other relevant information of the Directors and
Supervisors, see “Directors, Supervisors and Senior Management” in this prospectus.
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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PARTIES INVOLVED IN THE GLOBAL OFFERING
Sole Sponsor China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Sole Overall Coordinator China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Joint Global Coordinators China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
China Securities (International)
Brokerage Company Limited
18/F
Two Exchange Square
8 Connaught Place
Central
Hong Kong
CMBC Securities Company Limited
45/F
One Exchange Square
8 Connaught Place
Central
Hong Kong
Orient Securities (Hong Kong) Limited
28/F-29/F
100 Queen’s Road Central
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Joint Bookrunners China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
China Securities (International)
Brokerage Company Limited
18/F
Two Exchange Square
8 Connaught Place
Central
Hong Kong
CMBC Securities Company Limited
45/F
One Exchange Square
8 Connaught Place
Central
Hong Kong
Orient Securities (Hong Kong) Limited
28/F-29/F
100 Queen’s Road Central
Central
Hong Kong
ABCI Capital Limited
11/F
Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
–1 1 2–


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CCB International Capital Limited
12/F
CCB Tower
3 Connaught Road Central
Central
Hong Kong
China Everbright Securities (HK) Limited
33/F
Everbright Centre
108 Gloucester Road
Wanchai
Hong Kong
China Galaxy International Securities
(Hong Kong) Co., Limited
20/F
Wing On Centre
111 Connaught Road
Central
Hong Kong
China Merchants Securities (HK)
Co., Limited
48/F, One Exchange Square
8 Connaught Place
Central
Hong Kong
CMB International Capital Limited
45th Floor, Champion Tower
3 Garden Road
Central
Hong Kong
DBS Asia Capital Limited
73/F, The Center
99 Queen’s Road Central
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
–1 1 3–


--- page 123 ---
GF Securities (Hong Kong)
Brokerage Limited
27/F
GF Tower
81 Lockhart Road
Wan Chai
Hong Kong
ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Hong Kong
Shenwan Hongyuan Securities (H.K.)
Limited
Level 6
Three Pacific Place
1 Queen’s Road East
Hong Kong
Zhongtai International Securities Limited
19 Floor
Li Po Chun Chambers
189 Des V oeux Road
Central
Hong Kong
Joint Lead Managers China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
China Securities (International)
Brokerage Company Limited
18/F
Two Exchange Square
8 Connaught Place
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
–1 1 4–


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CMBC Securities Company Limited
45/F
One Exchange Square
8 Connaught Place
Central
Hong Kong
Orient Securities (Hong Kong) Limited
28/F-29/F
100 Queen’s Road Central
Central
Hong Kong
ABCI Securities Company Limited
10/F
Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
CCB International Capital Limited
12/F
CCB Tower
3 Connaught Road Central
Central
Hong Kong
China Everbright Securities (HK) Limited
33/F
Everbright Centre
108 Gloucester Road
Wanchai
Hong Kong
China Galaxy International Securities
(Hong Kong) Co., Limited
20/F
Wing On Centre
111 Connaught Road
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
–1 1 5–


--- page 125 ---
China Merchants Securities (HK)
Co., Limited
48/F, One Exchange Square
8 Connaught Place
Central
Hong Kong
CMB International Capital Limited
45th Floor, Champion Tower
3 Garden Road
Central
Hong Kong
DBS Asia Capital Limited
73/F, The Center
99 Queen’s Road Central
Central
Hong Kong
GF Securities (Hong Kong) Brokerage
Limited
27/F
GF Tower
81 Lockhart Road
Wan Chai
Hong Kong
ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Hong Kong
Shenwan Hongyuan Securities (H.K.)
Limited
Level 6
Three Pacific Place
1 Queen’s Road East
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
–1 1 6–


--- page 126 ---
Zhongtai International Securities Limited
19 Floor
Li Po Chun Chambers
189 Des V oeux Road
Central
Hong Kong
Fosun International Securities Limited
Suite 2101-2105, 21/F, Champion Tower
3 Garden Road
Central, Hong Kong
Futu Securities International
(Hong Kong) Limited
34/F
United Centre
No. 95 Queensway
Admiralty
Hong Kong
Guosen Securities (HK) Capital Company
Limited
Suites 3207-3212 on Level 32
One Pacific Place
88 Queensway
Hong Kong
Livermore Holdings Limited
Unit 1214A
12/F, Tower II, Cheung Sha Wan Plaza
833 Cheung Sha Wan Road
Kowloon
Hong Kong
Tiger Brokers (HK) Global Limited
1/F
No. 308 Des V oeux Road Central
Sheung Wan
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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TradeGo Markets Limited
Room 3405
West Tower, Shun Tak Centre
168-200 Connaught Road
Central
Hong Kong
Capital Market Intermediaries China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
China Securities (International)
Brokerage Company Limited
18/F
Two Exchange Square
8 Connaught Place
Central
Hong Kong
CMBC Securities Company Limited
45/F
One Exchange Square
8 Connaught Place
Central
Hong Kong
Orient Securities (Hong Kong) Limited
28/F-29/F
100 Queen’s Road Central
Central
Hong Kong
ABCI Capital Limited
11/F
Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
–1 1 8–


--- page 128 ---
ABCI Securities Company Limited
10/F
Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
CCB International Capital Limited
12/F
CCB Tower
3 Connaught Road Central
Central
Hong Kong
China Everbright Securities (HK) Limited
33/F
Everbright Centre
108 Gloucester Road
Wanchai
Hong Kong
China Galaxy International Securities
(Hong Kong) Co., Limited
20/F
Wing On Centre
111 Connaught Road
Central
Hong Kong
China Merchants Securities (HK)
Co., Limited
48/F, One Exchange Square
8 Connaught Place
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
–1 1 9–


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CMB International Capital Limited
45th Floor, Champion Tower
3 Garden Road
Central
Hong Kong
DBS Asia Capital Limited
73/F, The Center
99 Queen’s Road Central
Central
Hong Kong
GF Securities (Hong Kong) Brokerage
Limited
27/F
GF Tower
81 Lockhart Road
Wan Chai
Hong Kong
ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Hong Kong
Shenwan Hongyuan Securities (H.K.)
Limited
Level 6
Three Pacific Place
1 Queen’s Road East
Hong Kong
Zhongtai International Securities Limited
19 Floor
Li Po Chun Chambers
189 Des V oeux Road
Central
Hong Kong
Fosun International Securities Limited
Suite 2101-2105, 21/F, Champion Tower
3 Garden Road
Central, Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Futu Securities International
(Hong Kong) Limited
34/F
United Centre
No. 95 Queensway
Admiralty
Hong Kong
Guosen Securities (HK)
Capital Company Limited
Suites 3207-3212 on Level 32
One Pacific Place
88 Queensway
Hong Kong
Livermore Holdings Limited
Unit 1214A
12/F, Tower II, Cheung Sha Wan Plaza
833 Cheung Sha Wan Road
Kowloon
Hong Kong
Tiger Brokers (HK) Global Limited
1/F
No. 308 Des V oeux Road Central
Sheung Wan
Hong Kong
TradeGo Markets Limited
Room 3405
West Tower, Shun Tak Centre
168-200 Connaught Road
Central
Hong Kong
Legal Advisers to the Company As to Hong Kong law:
Jingtian & Gongcheng LLP
Suites 3203-3207, 32/F, Edinburgh Tower
The Landmark
15 Queen’s Road Central
Hong Kong, China
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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As to U.S. laws:
Ashurst Hong Kong
43/F Jardine House
1 Connaught Place
Central
Hong Kong, China
As to PRC law:
Jingtian & Gongcheng
34/F, Tower 3
China Central Place
77 Jianguo Road
Chaoyang District
Beijing
PRC
Legal Advisers to the Sole Sponsor and
Underwriters
As to Hong Kong and U.S. laws:
O’Melveny & Myers
31/F, AIA Central
1 Connaught Road Central
Hong Kong, China
As to PRC law:
AllBright Law Offices
11, 12/F, Shanghai Tower
No. 501 Yincheng Middle Road
Pudong New Area Shanghai, PRC
Auditors and Reporting Accountants KPMG
Certified Public Accountants
8/F, Prince’s Building
10 Chater Road
Central
Hong Kong, China
Industry Consultant Shanghai iResearch Co., Ltd.
3/F, Building H
Xuhui Wanke Center
No. 9333 Humin Road
Xuhui District
Shanghai
PRC
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Receiving Banks Bank of China (Hong Kong) Limited
1 Garden Road
Hong Kong
China Construction Bank (Asia)
Corporation Limited
26/F, CCB Tower
3 Connaught Road Central
Central
Hong Kong
Industrial and Commercial Bank of China
(Asia) Limited
33/F, ICBC Tower
3 Garden Road
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 133 ---
Registered Office in the PRC Unit 418, Building 2, No. 508, Chundong
Road, Minhang District, Shanghai, PRC
Headquarters and Principal Place of
Business in the PRC
7DEF, Building G, Weijing Center, No.
2337 Gudai Road, Minhang District,
Shanghai
Principal Place of Business in Hong Kong 40th Floor, Dah Sing Financial Centre,
No. 248 Queen’s Road East,
Wanchai, Hong Kong, China
Company Website www.voicecomm.cn
(Information contained on this website does
not form part of this prospectus)
Joint Company Secretaries Ms. Liu Yihan
(ᄎᖵ଄ɾɻ)
Lane 748, Baochun Road
Minhang District
Shanghai
Mr. Cheung Kai Cheong Willie
(΋͛)
(FCCA, CP A)
40th Floor, Dah Sing Financial Centre
No. 248 Queen’s Road East
Wanchai
Hong Kong, China
Authorized Representatives Mr. Tang Jinghua
(ಷหശ)
Room 1701, No.17
Chunshen Jingcheng II, Lane 1199
Xingmei Road Minhang District
Shanghai
Ms. Liu Yihan
(ᄎᖵ଄ɾɻ)
Lane 748, Baochun Road
Minhang District
Shanghai
CORPORATE INFORMATION
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--- page 134 ---
Audit Committee Mr. Sinn Wai Kin Derek ( ᤑਃ਄) (Chairman)
Mr. Wu Haipeng ( юऎᘄ)
Mr. Yang Xiaoyuan ( เወ๕)
Remuneration Committee Mr. Liu Rong ( ᄎ࿰) (Chairman)
Mr. Sinn Wai Kin Derek ( ᤑਃ਄)
Mr. Tang Jinghua ( ಷหശ)
Nomination Committee Mr. Mu Binrui ( ϳⅳ๿) (Chairman)
Mr. Liu Rong ( ᄎ࿰)
Mr. Tang Jinghua ( ಷหശ)
Strategy Committee Mr. Tang Jinghua ( ಷหശ) (Chairman)
Mr. Sun Qi (೘)
Mr. Chen Yulei ( ௓ρཤ)
Compliance Advisor Maxa Capital Limited
2602 Golden Centre
188 Des V oeux Road Central
Sheung Wan, Hong Kong
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 Bankers Bank of China Limited,
Shanghai Minhang Sub-branch
256 Xinjian Road
Minhang District
Shanghai
Agricultural Bank of China Limited,
Shanghai Minhang Sub-branch
58 Shuiqing South Road
Shanghai
CORPORATE INFORMATION
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--- page 135 ---
The information and statistics set out in this section and other sections of this
prospectus were extracted from the report prepared by iResearch, which was
commissioned by us, and from various official government publications and other
publicly available publications. We engaged iResearch to prepare the iResearch Report,
an independent industry report, in connection with the Global Offering. We believe that
the sources of this information are appropriate sources for such information and have
taken reasonable care in extracting and reproducing such information. We have no reason
to believe that such information is false or misleading or that any fact has been omitted
that would render such information false or misleading. The information from official
government sources has not been independently verified by us, the Sole Sponsor , the Sole
Overall Coordinator , the Underwriters or any other party involved in the Global Offering
and no representation is given as to its accuracy.
Accordingly, you should not place undue reliance on such information. For risks
relating to our industry, see “Risk Factors – Risks Relating to Our Industry” in this
prospectus.
AI SOLUTION MARKET IN CHINA
Artificial Intelligence (AI) is a branch of computer science that studies and develops
technologies applied to simulate and extend human intelligence. It is aimed at simulation of
human perception, cognition, and thinking through algorithms and models, so as to realize
human-like intelligence throughout the communication, thinking and execution processes.
With the surging trend of digitalization and intelligent transformation globally, AI is
currently being integrated deeply with various industries, in which it is leading towards global
technological innovations and development of new application scenarios. Therefore, AI has
been regarded as the “next-generation infrastructure”, being widely applied in areas including
city management and administrative services, transportation, telecommunications, finance,
healthcare and education, etc. According to the iResearch Report, the global AI solution market
reached RMB1.4 trillion in 2023 and is expected to reach RMB4.3 trillion in 2028, at a CAGR
of 24.1% from 2023 to 2028.
The AI solution market in China is now pioneering the global AI solution market with the
highest growth rate, which has been strongly stimulated by continuous favorable industrial
policies and constant accumulations of talents, patents and investments, among other
development resources, into the area. According to the iResearch Report, the AI solution
market in China reached RMB272.4 billion in 2023 and is expected to reach RMB761.2 billion
in 2028, at a CAGR of 22.8% from 2023 to 2028.
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The AI solution market in China can be categorized into segments including
conversational AI solutions, computer vision AI solutions and AI general technologies
solutions. The following sets forth the definition and major applications of these three
categories of technologies:
 Conversational AI comprises the complex of technologies that enable machines to
understand the intent behind natural languages and, through effective human-
machine interactions, respond to human beings or execute various tasks assigned by
human beings. It realizes speech-based communications between human beings and
machines by combining technologies including unified communications, automatic
speech recognition, emotion recognition, natural language processing and text to
speech.
 Computer Vision AI enables cameras and computers to identify, track and measure
images and videos in lieu of human eyes, through which it allows extraction of
valuable information and data, and performance of tasks such as analyses and
automation.
 AI General Technologies refer to those key generally applicable AI technologies
other than conversational AI and computer vision AI, such as machine learning,
which can also play an important role in the aforementioned two areas.
According to the iResearch Report, conversational AI solutions accounted for 24.9% of
the AI solution market in China in 2023. This share expected to increase to 28.8% in 2028. The
conversational AI solution market in China is expected to grow at a CAGR of 26.4% from 2023
to 2028, making it the fastest-growing segment among all three segments.
Market Size of AI Solution Market in China by Segment, 2021-2028E
(2)
210.6 232.9
328.6
399.9
491.3
609.0
761.2
+13.9% +26.4%
+13.7%
CAGR
21-23
CAGR
23-28E
+22.8%
+18.3% +25.4%
+11.6% +19.5%
47.3
83.8
(25.5%)
105.3
(26.3%)
131.6
(26. 8%)
163.6
(26.9%)
204.7
(26.9%)111.1
122.4
(52.6%)
161.3
(49.1%)
190.5
(47.6%)
227.8
(46.4%)
275.9
(45.3%)
337.7
(44.4%)
52.2
58.0
(24.9%)
83.5
(25.4%)
272.4
66.1
(24.3%)
138.5
(50.9%)
67.8
(24.9%)
104.1
(26.0%)
131.9
(26.8%)
169.5
(27.8%)
218.9
(28.8%)
2021 2022 2023 2024E 2025E 2026E 2027E 2028E
Conversational AI Solution(1)
AI General Technologies Solution
Computer Vision AI Solution
RMB billion
52.5
(22.5%)
Source: iResearch Report
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Notes:
(1) Conversational AI solutions referred to in this prospectus also include IT solutions that, besides core
conversational AI technologies defined below, are additionally empowered by unified communications and/or
other AI technologies.
(2) The market size is calculated based on revenue from sales of software, hardware, and supporting services. In
the case of AI general technologies solutions being applied to conversational AI or computer vision AI
solutions, they were taken into account when calculating the respective market size of conversational AI or
computer vision AI solutions within China’s AI solution market. Numbers of each item may not add up to the
total due to rounding.
MARKET OF IT SOLUTIONS EMPOWERED BY CONVERSATIONAL AI & UC IN
CHINA
According to the iResearch Report, the conversational AI solution market in China can be
divided into that of enterprise-level conversational AI solutions and consumer-level
conversational AI solutions based on the type of target users, among which:
 Enterprise-Level Conversational AI Solutions target organizations, including
corporations and government entities, and aim to offer solutions based on
conversational AI technologies applied in various end-customer industries. By being
integrated with organizations’ business procedures on production, sales and post-
sales services, etc., such solutions are to improve their communication efficiency
and facilitate the intelligent transformation of their operations, so as to achieve
cost-efficiency.
 Consumer-Level Conversational AI Solutions aim at providing individual
consumers with conversational AI-empowered solutions that can be used in daily
application scenarios to achieve human-machine interactions and device control.
The following table illustrates a comparison between the current application status of
enterprise-level conversational AI solutions and consumer-level conversational AI solutions:
Technical threshold
High
High
Medium
High
High
Low
Assessed by the type of technologies required to meet
the minimum usage requirements
Development investment requirements
Assessed by the average R&D investment of solution providers
Technology maturity
Assessed by current demand satisfaction in various
application scenarios
Commercialization potential
Anti-cyclicality
Assessed by the size of the potential serviceable market
Assessed by revenue model and key factors that affect
market payment
Market competition
Assessed by the number of market participants and
whether there is an oligopoly or monopoly market
Enterprise-Level
conversational AI Solution
Consumer-Level
conversational AI Solution
Low
Low
Medium
Low
Low
High
Source: iResearch Report
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According to the iResearch Report, the market growth of consumer-level conversational
AI solutions depends substantially on consumers’ willingness for spending on the smart
devices into which the conversational AI technologies are embedded. By contrast, enterprise-
level conversational AI solutions in China are pertinent to more diversified application
scenarios in the course of enterprise-level users’ digitalization and intelligent transformation,
thus having higher commercial values in comparison with the former. In 2023, the
enterprise-level conversational AI solution market in China reached RMB62.1 billion, and is
expected to reach RMB204.1 billion in 2028, at a CAGR of 26.9% from 2023 to 2028.
However, the penetration rate of enterprise-level conversational AI solutions in China,
calculated based on the proportion of enterprise-level users that have deployed conversational
AI solutions, was merely 11.6% in 2023, which is expected to increase to 16.2% in 2028.
Market Size of IT Solutions Empowered by Conversational AI & UC in China
(Enterprise-Level vs. Consumer-Level), 2021-2028E*
52.2 58.0
67.8
83.5
104.1
131.9
169.5
218.9
+13.9%
CAGR
21-23
CAGR
23-28E
+26.4%
+13.5% +21.1%
+13.9% +26.9%
47.8
53.2
(91.6%)
62.1
(91.6%)
76.8
(92.0%)
96.0
(92.2%)
122.1
(92.6%)
157.5
(92.9%)
204.1
(93.2%)
4.4 5.7
(8.4%)
4.9
(8.4%)
6.7
(8.0%)
8.1
(7.8%)
9.8
(7.4%)
12.0
(7.1%)
14.8
(6.8%)
2021 2022 2023 2024E 2025E 2026E 2027E 2028E
Consumer-level
solution
Enterprise-level
solution
RMB billion
Source: iResearch Report
Note:
* The market size of enterprise-level conversational AI solution market is calculated based on revenue from sales
of relevant software and hardware, as well as other related supporting services, to enterprise-level users. The
market size of consumer-level conversational AI solution market takes into account the output value of
algorithms for AI speech assistant embedded in smart hardware in China, the forms of which include API calls
or technological outputs, etc. Numbers of each item may not add up to the total due to rounding.
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Enterprise-Level Conversational AI Leads Technological Innovations in China’s
Conversational AI Solution Market
According to the iResearch Report, the AI technologies key to conversational AI solutions
include speech-related core conversational AI technologies, i.e., automatic speech recognition
(ASR), emotion recognition, natural language processing (NLP) (primarily consisted of natural
language understanding (NLU) and natural language generation (NLG)) and text to speech
(TTS), as well as AI general technologies that can be applied in speech and semantic analysis,
the details of which are set forth below:
 ASR converts human speech signals into corresponding computer-readable inputs
such as texts, through speech signal processing and pattern recognition based upon
parameters of speech features. ASR includes such key technological areas as
voiceprint recognition, accent adaptation, end-to-end recognition, and low-power
recognition, etc.
 Emotion Recognition suggests the current emotion states of human through
collecting speech, facial expression, gestures and other physiological
characteristics, as well as the analysis and processing of the same. Specifically,
emotion recognition extracts the acoustic features expressing emotions from speech
signals and establishes the mapping relationship between such features and human
emotions, so as to realize the automatic recognition of the latter.
 NLU allows machines to understand the meaning of human languages through
mapping users’ inputs into the semantic slots predefined according to different
scenarios, which covers the analyses of human pronunciation, vocabulary, grammar,
semantics and pragmatics, as well as reasonings and logics.
 NLG transforms the abstract expressions output by machines into syntactically
sensible and semantically accurate natural language utterances, which covers such
key steps as content determination, text structuring, sentence aggregation,
lexicalization, referring expression generation and linguistic realization.
 TTS realizes human-machine speech interactions by firstly generating speech
parameters based on models, and then converting such parameters into natural
speech streams, thereby giving machines the ability to talk.
In addition to the abovementioned core conversational AI technologies, enterprise-level
conversational AI solutions can be substantially empowered by technologies on unified
communications (UC), which represent a new mode of communications that integrates
computer technologies with traditional communication technologies. Unified communications
realize the connection and integration of multi-standard communication methods through
gateways, and provide full-service support covering audios, videos, data and multimedia, etc.,
thereby enhancing the level of communication flexibility and efficiency. The high synergies
between unified communications and AI technologies for enterprise-level conversational AI lie
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in the fact that, in order for the solutions to truly improve enterprises’ communication
efficiency and facilitate the intelligent transformation of their operations on a one-stop basis,
a complete and seamless human-machine dialogue process has to be enabled. Such a process
necessitates the integration of signal input before human-machine dialogue for the interaction
to be made and signal output after human-machine dialogue for the execution to be
implemented, so that the application value of the processing activities realized by core
conversational AI technologies can be considerably amplified. As such, for enterprise-level
users of conversational AI solutions that require high standards of scale, efficiency and quality
in speech signal input and output, unified communications can effectively support and ensure
the said steps crucial for a complete human-machine dialogue process. For details of the value
of unified communications in addressing the pain points experienced by enterprise-level users
of conversational AI solutions in China, see “– Market of Full-Stack Enterprise-Level IT
Solutions Empowered by Conversational AI & UC in China” in this section.
Enterprise-level conversational AI solutions need to be deeply integrated with
applications scenarios of users from different end-customer industries, and are expected to
continuously improve user experiences in cross-industry, cross-area, and cross-department
business settings. As such, enterprise-level conversational AI solutions carry higher
technological requirements compared with consumer-level conversational AI solutions with
respect to recognition accuracy, response speed, system stability and ability to deal with high
concurrencies, etc., therefore necessitating large-scale development expenditures.
Furthermore, in contrast to consumer-level conversational AI solutions featured by a single
round of conversation mostly in absence of mandatory technological parameters, enterprise-
level conversational AI solutions need to be equipped with the capabilities of making
multiple-round meaningful conversations to truly and accurately understand users’ semantics
and intent, and accordingly generate the accurate answers. Currently, enterprise-level
conversational AI is hence leading the technological innovations and application
diversification of conversational AI in China.
Growth Drivers of China’s Enterprise-Level Conversational AI Solution Market
Stimulated by China’s favorable industrial policies facilitating the digitalization of
organizations on the supply side, and the significant economic scale and considerable social
activity level giving rise to a rich variety of application scenarios on the demand side, growth
of the enterprise-level conversational AI solution market in China is primarily driven by:
 Organization Digitalization. The digitalization of organizations in China is already
a major trend. In 2022, the digital economy in China reached RMB50.2 trillion,
accounting for 41.5% of the total GDP and substantially impacting the overall
economy. As a crucial pathway for and process of organization digitalization,
enterprise-level conversational AI solutions facilitate organizations’ cost-effective
operations and improve the overall recognition of their commercial value and their
monetization abilities. Firstly, organizations’ digitalization necessitates unified
communication technologies enabling the inbound and outbound communications of
information generated during their operations in various formats, such as audios,
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--- page 141 ---
texts, images, videos, and a combination of the same. Such unified communication
capabilities enrich organizations’ information exchanged, expand their forms of
communications and improve their communication efficiency. In addition,
organizations’ accumulation of insights in the aforementioned multimodal forms
through the digitalization trend further assists the efficient, speedy and scenario-
oriented research and development of novel algorithms and optimization of machine
learning models.
 Technological Improvements. With the evolvement of core intelligent-speech
technologies, the boundaries of enterprise-level conversational AI with respect to
the value it is able to create have been constantly extended. Originated from the
simple Q&A interactions between human beings and machines, enterprise-level
conversational AI solutions have gradually evolved to integrate knowledge
engineering capabilities, such as knowledge base and knowledge graphs, and
emotion computing models, which have equipped machines with solid knowledge
background and the ability to conceive human emotions. Such progress has been
efficiently automating business operations and enhancing enterprise-level user
experiences, and further driving the ongoing expansion of the enterprise-level
conversational AI solution market in China.
 Application Scenarios Expansion and User Experience Enhancement. As the
application scenarios of human-machine interactions continue to deepen and
broaden, enterprise-level conversational AI solutions have been empowering
business operations through technological offerings, with innovative ones with
higher cognitive abilities and tighter integration with downstream applications being
actively explored. Benefitting from the foregoing, incremental markets have
gradually been emergent. In addition, enterprise-level users have developed more
diversified and demanding needs for the level of intelligence, flexibility and
efficiency enabled by conversational AI solutions in the course of industrial
upgrading, intensification of market competitions and updates in management
notions, whereby differentiated market demand and continuously improved user
experiences further stimulating the development of enterprise-level conversational
AI solutions.
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 Favorable Industrial Policies. Enterprise-level conversational AI acts as the key
infrastructure that integrates the digital and real sectors of the Chinese economy. In
recent years, favorable policies supporting the development of digital economy,
unified communications and AI technologies have been released in succession, in
order to encourage the development and commercialization of the relevant
technologies. The following table illustrates a number of major favorable industrial
policies:
Policies
Issuance
Date Issuer Description
Plan for the Overall
Layout of Building a
Digital China (ᅰο
ண዆᜗б҅஝
ྌ) (the “ Plan”)
February
2023
Central Committee
of the Communist
Party of China,
the State Council
The Plan clarifies that the construction
of digital China will be laid out in
accordance with the overall
framework of “2522”, by, among
others, solidifying the “two
foundations” of digital infrastructure
and data resource systems.
Opinions on Building a
Basic Data System to
Better Fulfill the
Functions of Data
Elements (ܔ
һλ೯౨
จ
Ԉ) (the “ Opinions ”)
December
2022
Central Committee
of the Communist
Party of China,
the State Council
The Opinions propose to, among others,
fully leverage China’s advantages of
vast data scale and diverse application
scenarios, and scale up, strengthen
and optimize China’s digital economy.
Notice on Supporting the
Construction of a New
Generation of AI
Exemplary Application
Scenarios (ܵ
ணอɓ˾ɛʈ౽ঐͪ
)
(the “ Notice ”)
August 2022 Ministry of Science
and Technology
The Notice proposes to, among others,
fully harness AI’s role of empowering
economic and social development, and
support a group of AI application
scenarios with relatively mature
accumulations.
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Policies
Issuance
Date Issuer Description
Guiding Opinions on
Accelerating Scenario
Innovation to Promote
High-Quality Economic
Development Through
Advanced AI
Applications (̋
Ҟఙ౻௴อ˸ɛʈ౽ঐ
ආ຾᏶৷
ኬจ
Ԉ) (the “ Guiding
Opinions ”)
July 2022 Ministry of Science
and Technology,
the MIIT, etc.
The Guiding Opinions, among others,
propose the theme of deep integration
of AI and the real economy, and the
direction of opening up scenario
resources and enhancing scenario
innovation capabilities.
Guidelines for the
Construction of a New
Generation of National
Open Innovation
Platforms for AI (਷
׳
ܸ
ˏ) (the
“Guidelines ”)
July 2017 Ministry of Science
and Technology
The first batch of a new generation of
national open innovation platforms for
AI released pursuant to the Guidelines
included such platforms as related to
autonomous driving, city brain and
intelligent speech, etc.
In addition, the Plan for Development of Digital Economy during the “14th
Five-Year” Period (“ɤ̬ʞ”஝ྌ) issued by the State Council in
December 2021 specifically singles out the development of digital economy and sets
raising the added-value of core digital economy industries to account for 10% of the
GDP by 2025 as a major objective. It also highlights facilitating China’s strength in
cyberspace, accelerating digital economy, digital society and digital government
construction, and evolutionizing economic production, social lifestyle and
governance patterns through digital transformation. In addition to calling for
development in key fields such as AI, big data and cloud computing, it, among
others, proposes the planning and construction of new type of infrastructure such as
information infrastructure, integrated infrastructure and innovative infrastructure,
centered upon enhancing the digital transformation, intelligent upgrading and
integrated innovations.
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In addition to the aforementioned key drivers, the enterprise-level conversational AI
solution market in China may be further catalyzed by the development of large language
models (LLMs) in the broader conversational AI field and the emergence of any disruptive
market players. As a model that may potentially lead to the development of artificial general
intelligence, LLMs have become a prominent topic in the AI industry in recent years as they
have shown remarkable capabilities in natural language understanding and generation.
Particularly, LLMs have received huge public attention since the end of 2022 with the launch
of several ground breaking LLM-based products.
Market of Enterprise-Level IT Solutions Empowered by Conversational AI & UC in
China by End-Customer Industries
Enterprise-level conversational AI solutions can be widely applied in a number of
representative end-customer industries such as city management and administration,
automotive and transportation, telecommunications, and finance, where conversational AI
technologies empower various types of organizations to optimize their business procedures and
iterate their business paradigms, thereby improving their operation efficiency and reducing
operating costs. Specifically,
 City Management and Administration. Conversational AI empowers local
administrators’ improving their civil governance and facilitating industrial
development, as well as other related missions, i.e., upgrading of administrative
services, intelligent interconnection and scheduling of administrative facilities, and
establishment of regional intelligent technological infrastructure.
 Automotive and Transportation. Conversational AI empowers the automobile and
logistics industries and the public transportation system through the intelligent
transformation of customer services of automobile and logistics companies, and the
realization of internet of vehicles based upon human-vehicle intelligent in-cabin
speech interactions and vehicle-to-everything autonomous driving.
 Telecommunications. Conversational AI empowers telecommunications companies
and users of their services through the intelligent transformation of customer
services of telecommunications companies and communication tools offered to
enterprises for the latter’s communication and management needs.
 Finance. Conversational AI empowers financial institutions through the intelligent
transformation of their customer communication-related services and their
employment training and management.
 Other Industries. Conversational AI solutions can also be widely applied to other
industries, such as education, healthcare, tourism, the media, E-commerce and
retailing, etc.
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Market Size of Enterprise-Level IT Solutions Empowered by
Conversational AI & UC in China by End-Customer Industries, 2021-2028E*
204.1
17.8 City management and
administration
Automotive and
transportation
RMB billion
Telecommunications
Finance
Other industries
+11.0%
+25.6%
+15.6%
+11.7%
+8.3%
+21.7%
+13.9% +26.9%
CAGR
21-23
CAGR
23-28E
+30.3%
+23.6%
+22.7%
+30.0%
47.6
46.4
20.1
72.2
14.3
36.0
36.7
15.9
54.5
40.831.0
10.4
24.0
21.0
9.676.8
7.9
16.3
19.6
8.67.2
16.1
12.7
6.7
62.1
47.8
5.4
8.0
12.0
5.8
16.6 24.419.4
6.4
13.4
9.9
6.1
53.2
17.4
96.0
12.8
29.5
27.4
11.7
122.1
157.5
2021 2022 2023 2024E 2025E 2026E 2027E 2028E
Source: iResearch Report
Note:
* Numbers of each item may not add up to the total due to rounding.
Market of Full-Stack Enterprise-Level IT Solutions Empowered by Conversational AI &
UC in China
Despite the surge in demand for enterprise-level conversational AI applications and
optimistic market growth prospects, China’s enterprise-level conversational AI solution market
is currently still experiencing a number of pain points in fundamentally addressing the needs
of enterprise-level users. Such pain points make it especially challenging for non-full-stack
providers, i.e., those who focus merely on the development and commercialization of certain
single-point conversational AI technological segments, yet some or all of the unified
communication and essential AI algorithm capabilities are realized by integrating with
third-party providers, to truly and effectively satisfy enterprise-level users’ needs. Specifically,
it may not be possible for such non-full-stack solution providers to allow enterprise-level users
to enjoy:
 One-Stop Service. Considering enterprise-level users’ needs of conversational AI
empowerment on a one-stop basis, each product under non-full-stack solutions is
independently designed and developed by different providers. Such fragmentation of
products and providers will lead to issues with product compatibility, lower overall
system efficiency and cause substantial post-integration maintenance, etc., with data
silos left unconnected.
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 Convenient Application-Scenario Expansion. Notwithstanding that users often
need the solutions to be highly scalable across various scenarios, non-full-stack
solution providers may not be able to realize the uniform management of the
resulting solutions due to the fact that each integrated software is associated with its
own management and monitor platform, making it challenging to deliver a
“ready-to-use-whenever-needed” user experience.
 In-Depth Service. With respect to the users who need the solutions to cover both the
establishment of underlying technological infrastructure and upper-layer
AI-empowerment of applications, non-full-stack solutions are nevertheless
generally limited to the application layer, and their providers are hence unable to
optimize the overall system according to the specific application scenarios.
 Selectable Delivery. Users ultimately choose the delivery, e.g. privatized
deployment, cloud-based subscription or a combination of the same, based on
various considerations such as business stability, data security, available budget,
deployment locality and technological iterations, etc. However, it is difficult for
non-full-stack solution providers to deliver their solutions flexibly to meet the
rapidly iterative business needs of users.
 Cost Efficiency. According to the iResearch Report, the total cost of ownership of
procuring and integrating multiple non-full-stack solutions is about 15%-30% higher
than full-stack solutions due to functional redundancy and lack of standardization,
causing substantial additional cost of use and operation and maintenance costs.
Besides, the potential improvement for business operations’ efficiency enabled by
such multiply integrated solutions may not meet users’ expectations, thus leading to
uncertain return on investment.
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In order to fundamentally address these key pain points and challenges, market players in
China’s enterprise-level conversational AI solution market are increasingly seeking for
“full-stack” solutions, developed and offered by conversational AI solution providers that
possess proprietary unified communication and essential AI algorithm capabilities with the
ability to self-develop conversational AI applications which have achieved large-scale
commercialization. The following table illustrates the comparison between full-stack
enterprise-level conversational AI solution providers and their non-full-stack counterparts with
respect to addressing the pain points discussed above:
Full-stack Conversational AI solution providers Non-full-stack Conversational AI solution providers
One-stop service
capability
Application-scenario
expansion capability
Device compatibility
Service depth
Cost efficiency
Delivery selectability
Non-full-stack solution providers are generally unable to empower old
hardware devices with conversational AI abilities due to a lack of unified
communication capabilities
Full-stack solution providers have  advantages especially for the
conversational AI empowerment of  old hardware devices due to
compatibility with multiple communication protocols
Non-full-stack solutions may result in substantial additional cost of use
and operation and maintenance costs
Full-stack solution providers are usually able to deliver their solutions in
the form as selected by the specific users
Full-stack solution providers can offer one-stop service from
communication infrastructure to front-end application for users
The technological support or services offered by non-full-stack solution
providers are to be integrated with other similar providers to aggregately
enable a full-stack conversational AI solution
Option Availability
Due to the all-encompassing nature of full-stack solutions, users will
compromise their autonomy while implementing the project with respect
to technological specifications
Users can discretionarily choose from non-full-stack solution providers
(including that on communication infrastructure) to allow focused
customization and wide choices of specific solutions that they may need
Non-full-stack solution providers are usually able to deliver their
solutions in identical form according to their technological specialty
Full-stack solution providers may comprehensively adapt to user needs in
terms of communication quality, optimization by scenario-specific AI
algorithms, etc.
The depth of service of non-full-stack solution providers depends upon
the specific technological segments that they are able to empower, on
which they are yet able to offer advantageous solutions tailored to users’
the particular need for the same
Full-stack solutions may cover various scenarios through follow-up
application development
The application scenarios that can be expanded by non-full-stack
solution providers are contingent upon the infrastructure of the integrated
third-party platform or the coding capabilities on the integrators
Full-stack solutions from the infrastructure layer to the application layer
can save external procurement costs
Source: iResearch Report
As can be seen, full-stack enterprise-level conversational AI solution providers have
comprehensive advantages over non-full-stack enterprise-level conversational AI solution
providers with respect to one-stop service capability, application-scenario expansion
capability, service depth, delivery selectability, cost efficiency realized for users, and device
compatibility. In particular, due to the higher requirements by major users in the market
(including large enterprises and government entities) thereon, it is expected that full-stack
solution providers will seize greater market opportunities by fully exercising their
technological advantages.
In addition to the disparities with respect to addressing the pain points discussed above,
please see below for a further comparison between full-stack enterprise-level conversational AI
solution providers and non-full-stack enterprise-level conversational AI solution providers in
terms of capital investment, technical expertise, pricing and qualifications, according to the
iResearch Report. The comparison below is made only by virtue of the fact that full-stack
enterprise-level conversational AI solution providers and non-full-stack enterprise-level
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conversational AI solution providers provide full-stack enterprise-level solutions and non-full-
stack enterprise-level solutions, respectively, and may not be indicative of any comparison
between two concrete enterprise-level conversational AI solution providers that are contingent
upon the specific customer groups, research and development regimes, and solution offerings
etc., involved. Specifically:
 Capital Investment. To develop complete solutions based upon core technologies
in both unified communication and AI, full-stack enterprise-level conversational AI
solution providers generally have to invest in wider range of technological segments
than non-full-stack enterprise-level conversational AI solution providers, when
achieving equivalent service outcomes and scale, whose solutions based upon their
expertized technological segments have to be integrated with that of other providers.
 Technical Expertise. As mentioned above, full-stack enterprise-level
conversational AI solution providers possess proprietary unified communication and
essential AI algorithm capabilities with the ability to self-develop conversational AI
applications, whereas non-full-stack enterprise-level conversational AI solution
providers focus on single-point conversational AI technological segments, yet some
or all of the unified communication and essential AI algorithm capabilities are
realized by integrating with solutions of other providers.
 Pricing. Without considering the specific competitive strategies and business
models of different conversational AI solution providers, wider range of proprietary
technologies under full-stack enterprise-level conversational AI solutions need to be
priced than that under non-full-stack enterprise-level conversational AI solutions.
Users have to invest additionally if they want to access the complete range of
functionalities when they deploy non-full-stack conversational AI solutions.
 Qualifications. The attainment of certain qualifications is essentially an
autonomous action of enterprise-level conversational AI solution providers in
association with their intended scope of business, operational capacities and
technological capabilities, without mandatory industry-entry standards. Common
qualifications within the industry include Software Enterprise Certificate ( ழ΁Άุ
ࣣQuality Management System Certificate (ࣣ,)
Information Technology Service Standard (ITSS) Certificate (ਕᅺ๟ᗇ
ࣣHigh and New Technology Enterprise Certificate (ࣣetc.
Full-stack enterprise-level conversational AI solution providers involved in
telecommunications services may, as required or as relevant, possess V AT License
(ุਕ຾ᐄ஢̙ᗇ).
The size of the full-stack enterprise-level conversational AI solution market in China is
expanding significantly, with robust business value and considerable growth potentials.
According to the iResearch Report, the full-stack enterprise-level conversational AI solution
market in China is expected to grow from RMB21.1 billion in 2023 to RMB73.3 billion in
2028, at a CAGR of 28.3% from 2023 to 2028, which is higher than the 26.1% CAGR of the
non-full-stack enterprise-level conversational AI solution market in China during the same
years.
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Market Size of Full-Stack Enterprise-Level IT Solutions Empowered by
Conversational AI & UC in China
(Full-Stack vs. Non-Full-Stack), 2021-2028E*
62.1
76.8
96.0
122.1
157.5
204.1
130.7
101.9
79.6
63.250.641.0
+13.9%
CAGR
21-23
CAGR
 23-28E
+26.9%
+13.5% +26.1%
+14.8% +28.3%
2021 2022 2023 2024E 2025E 2026E 2027E 2028E
Non-full-stack
Full-stack
47.8
31.8
16.0
(33.5%)
21.1
(34.0%)
53.2
35.2
17.9
(33.7%)
26.2
(34.1%)
32.9
(34.2%)
42.5
(34.8%)
55.6
(35.3%)
73.3
(35.9%)
RMB billion
Source: iResearch Report
Note:
* Numbers of each item may not add up to the total due to rounding.
Competitive Landscape
According to the iResearch Report, our competitors in China’s enterprise-level
conversational AI solution market can be divided into the following categories: (i) companies
that have transitioned from communication technology services to AI research and
development and thus have full-stack service capabilities; (ii) traditional communication
technology service companies; (iii) intelligent speech and semantic companies; and (iv)
general AI companies. According to the iResearch Report, we rank the sixth in the
enterprise-level conversational AI solution market in China as measured by revenue in 2023.
The respective comparable revenue and market share of each of the top ten solution providers
in such market is shown in the following table:
Ranking Company
Comparable Revenue
in 2023 Market Share in 2023
(RMB billion) (%)
1 Company G (1) 5.58 9.0
2 Company A 2.77 4.5
3 Company H
(2) 1.35 2.2
4 Company I (3) 0.93 1.5
5 Company J (4) 0.90 1.5
6 V oicecomm 0.80 1.3
7 Company K
(5) 0.73 1.2
8 Company L (6) 0.60 1.0
9 Company B 0.40 0.6
10 Company C 0.30 0.5
Top ten in total 14.36 23.3
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Notes:
(1) Company G is a leading provider of information and communications technology (ICT) infrastructure
and smart devices. Company G is a private company founded in 1987 and headquartered in Shenzhen.
(2) Company H, listed on the NASDAQ Exchange in 2005 and dual-listed on the Stock Exchange in 2021,
is a leading technology company, specializing in internet-related services, products, and AI. Company
H was founded in 2000 and is headquartered in Beijing.
(3) Company I, listed on the New York Stock Exchange in 2014 and dual-listed on the Stock Exchange in
2019, is a leading provider of e-commerce and technology infrastructure services. Company I was
founded in 1999 and is headquartered in Hangzhou.
(4) Company J, listed on the Stock Exchange in 2004, is a leading provider of internet value-added services.
Company J was founded in 1998 and is headquartered in Shenzhen.
(5) Company K is a leading provider of intelligent voice technology and AI solutions. Company K is a
private company founded in 2012 and headquartered in Beijing with a registered capital of
approximately RMB69 million.
(6) Company L is a professional conversational AI solution provider offering both enterprise-level solutions
and consumer-level smart devices. Company L is a private company founded in 2007 and headquartered
in Suzhou with a registered capital of approximately RMB360 million.
According to the iResearch Report, we rank the second in the full-stack enterprise-level
conversational AI solution market in China, as measured by comparable revenue in 2023. The
combined market share of the top five providers account for 21.1% within China’s full-stack
enterprise-level conversational AI solution market. The respective comparable revenue and
market share of each such provider in 2023 is shown in the following table:
Ranking Company
Comparable Revenue
in 2023
Market Share
in 2023
(RMB billion) (%)
1 Company A (1) 2.77 13.1
2 V oicecomm 0.80 3.8
3 Company B
(2) 0.40 1.9
4 Company C (3) 0.30 1.4
5 Company D (4) 0.18 0.9
Top five in total 4.45 21.1
Notes:
(1) Company A, listed on the Shenzhen Stock Exchange in 2008, is a leading player in the field of NLP
technologies in China, and provides a wide range of AI-enabled software, systems and services such as
speech recognition, voiceprint recognition, language translation and intelligent speakers for use in
various applications. Company A was founded in 1999 and is headquartered in Hefei, Anhui with a
registered capital of approximately RMB2,323 million.
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(2) Company B is a leading provider of intelligent customer service management software and solutions
across various industries in China. Company B is a private company founded in 2013 and headquartered
in Beijing with a registered capital of approximately RMB100 million. In 2022, Company B was
included in the “National-Level Specialized, Refined, Distinctive and Innovative ‘Small Giant’
Enterprises (SRDI) (ॴਖ਼ၚतอ“ʃ̶ɛ”)” list and became a member of the Chinese Association
for Artificial Intelligence ( ʕ਷ɛʈ౽ঐኪึ).
(3) Company C is a leading provider of intelligent contact center, customer service and enterprise
communication products and solutions in China. Company C is a private company founded in 2016 and
headquartered in Hangzhou with a registered capital of approximately RMB10 million. Company C was
included in the “Key Programs of AI-Precisely-Empowered SMEs (AIࣩby
the Department of Science and Technology of the MIIT of the PRC (Ҧ̡) in 2021,
and was selected as one of the “Outstanding Cases of Customer Service Center Application of 2022
(2022Է)” by the Artificial Intelligent Industry Alliance of China ( ʕ਷ɛʈ౽ঐପ
ᑌຑ) in 2022.
(4) Company D is a leading provider of intelligent customer service solutions in China, specializing in
AI-empowered chatbot and voice assistant technologies. Company D is a private company founded in
2014 and headquartered in Beijing with a registered capital of approximately RMB16 million. Company
D completed its Series D financing of USD100 million in February 2022.
The following table sets forth the respective comparable revenue and market share of each
top provider in China’s full-stack enterprise-level conversational AI solution market for city
management and administration in 2023:
Ranking Company
Comparable Revenue
in 2023
Market Share
in 2023
(RMB billion) (%)
1 V oicecomm 0.32 14.2
2 Company A 0.12 5.3
3 Company F* 0.02 0.9
Top three in total 0.46 20.4
Note:
* Company F is a leading intelligent technology company in China. With core competencies in AI, big
data and cloud computing, Company F is committed to helping China’s digitalization process and
provides digital solutions for enterprises across finance, retailing, education, medical care and
intelligent manufacturing, among other industries. Company F is a private company founded in 2007 and
headquartered in Beijing with a registered capital of approximately RMB1.4 billion. Company F is a
national High and New Technology Enterprise and High and New Technology Enterprise in
Zhongguancun, and was included in the “Beijing Specialized, Refined, Distinctive and Innovative
‘Small Giant’ Enterprises ( ̏ԯ̹ਖ਼ၚतอ“ʃ̶ɛ”)” list.
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The following table sets forth the respective comparable revenue and market share of each
top provider in China’s full-stack enterprise-level conversational AI solution market for
automotive and transportation in 2023:
Ranking Company
Comparable Revenue
in 2023
Market Share
in 2023
(RMB billion) (%)
1 Company A 0.75 17.4
2 V oicecomm 0.19 4.4
3 Company E* 0.06 1.4
Top three in total 1.00 23.2
Note:
* Company E, listed on the Stock Exchange in 2022, is a leading provider of customer contact solutions
for enterprises in China. Company E was founded in 2006 and is headquartered in Beijing with a
registered capital of approximately RMB52 million.
The following table sets forth the respective comparable revenue and market share of each
top provider in China’s full-stack enterprise-level conversational AI solution market for
telecommunications-related applications in 2023:
Ranking Company
Comparable Revenue
in 2023
Market Share
in 2023
(RMB billion) (%)
1 Company A 0.58 10.6
2 V oicecomm 0.17 3.1
3 Company D 0.02 0.4
Top three in total 0.77 14.1
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The following table sets forth the respective comparable revenue and market share of each
top provider in China’s full-stack enterprise-level conversational AI solution market for
finance-related applications in 2023:
Ranking Company
Comparable Revenue
in 2023
Market Share
in 2023
(RMB billion) (%)
1 Company A 0.14 5.7
2 Company B 0.10 4.1
3 V oicecomm 0.08 3.3
Top three in total 0.32 13.1
The key successful factors with respect to the aforementioned enterprise-level
conversational AI solution market in China primarily include:
 Technologies Accumulation. Technologies for enterprise-level conversational AI
solutions, such as UC, ASR, emotion recognition, NLU, NLG and TTS, as well as
AI general technologies, are charged with significant technological requirements,
and featured by high difficulties, long cycle and great expenditures with respect to
technological research and development. Therefore, new market entrants face great
difficulty in achieving practicable and sufficient technology accumulations in a
short period of time, and existing enterprise-level conversational AI solution
providers lacking the capabilities in technological development and iteration may
also lose their competitive edges.
 Industry Knowledge. Conversational AI solutions are applied in city management
and administration, automotive and transportation, telecommunications, finance and
other end-customer industries. Each industry accordingly requires in-depth
knowledge of the technological adjustment, solution design, and service process
unique thereto. Therefore, early movers with abundant industry knowledge
accumulations from previous project experiences usually deliver solutions and
accompanying services of higher quality and better consistency, thus forming a
competitive advantage over new market entrants.
 Customer Base. Existing enterprise-level conversational AI solution providers
dedicated to such solution offerings are also able to enhance their technological
development capabilities, speed up their model and algorithm training processes,
accumulate end-customer industry know-how and improve capabilities of serving
enterprise-level users through ample project implementation experiences, so as to
realize the establishment and accumulation of product modules and solutions in a
technology-oriented fashion. Benefitting from such conversational AI solution
offerings proven to be of high quality, they can more easily acquire new customer
orders and establish customer loyalty. In contrast, new market entrants are
constrained by their insufficient service experiences and may not be able to
sustainably acquire orders in a short period of time.
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 Capital Sufficiency. Due to the aforementioned technological requirements,
competitors in the enterprise-level conversational AI solution market are required to
devote huge capital investments in the establishment of strong technological R&D
teams by attracting highly qualified, skilled and multi-disciplinary professionals
experienced in conversational AI technologies. In addition, enterprise-level
conversational AI solution providers may be influenced by the internal budget
management, as well as bidding and other approval processes, of various enterprise-
level users. Therefore, new market entrants are challenged by such capital barrier
and requirements on working capital sufficiency.
MAJOR RA W MATERIAL ANALYSIS
The raw materials involved in conversational AI solutions primarily include (i) common
and standardized hardware devices (communication devices, computers and servers); and (ii)
network and telecommunication resources. The historical prices of hardware devices are
generally stable from 2021 to 2023, which is beneficial for the business development of
conversational AI solution providers. According to the iResearch Report:
 The global prices of smart phones, as measured by average wholesale price,
decreased from USD304.6 in 2021 to USD293.4 in 2023, representing a CAGR of
-1.9% from 2021 to 2023.
 The global prices of typical computing devices including desktop PCs, laptops, and
storage units have been relatively stable from 2021 to 2023. Detailed global average
prices of computing devices are set out below:
For the Y ear Ended
December 31,
CAGR
From 2021
to 20232021 2023
USD USD %
Desktop PCs 623.4 625.8 0.2
Laptops 639.3 637.1 (0.2)
Storage units 13.5 14.1 2.2
 The global average price of servers increased from USD8,048.7 in 2021 to
USD10,427.1 in 2023, representing a CAGR of 13.8% from 2021 to 2023. The price
of servers worldwide generally saw a surge attributed to increased demand driven by
escalating technological advancements, supply chain disruptions, and rising
infrastructure costs.
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The price of network and telecommunication resources generally had a steady decreasing
trend from 2021 to 2023. The average price of network and telecommunication resources in
China as measured by the average revenue generated therefrom per user of three major
telecommunications companies in China decreased from RMB418.5 in 2021 to RMB412.9 in
2023, according to the iResearch Report.
SOURCES OF INFORMATION
We commissioned iResearch, an independent market research and consulting firm, to
provide an analysis of, and to produce a report (the “ iResearch Report ”) on China’s AI
solution market. Founded in 2002, iResearch provides professional services including, among
others, industry consulting and strategic consulting, and has accumulated extensive
experiences in researching and monitoring the development of China’s AI solution market. We
have agreed to pay a fee of RMB600,000 to iResearch for preparing the iResearch Report. The
report was prepared independent of the influence of us and other interested parties. We have
extracted certain information from the iResearch Report in this section, as well as elsewhere
in this prospectus, to provide our potential investors with a more comprehensive presentation
of the industry in which we operate. Our Directors confirm that, after taking reasonable care,
they are not aware of any material adverse change in the overall market information since the
date of the iResearch Report that would materially qualify, contradict or have an adverse
impact on such information.
During the preparation of the iResearch Report, iResearch performed both primary and
secondary research, and obtained knowledge, statistics, information on and industry insights
into China’s AI solution market. Primary research involved interviewing key industry experts
and leading industry participants. Secondary research involved analyzing data from various
publicly available data sources.
The market projections in the iResearch Report are based on the following assumptions:
(i) the overall social, economic, and political environment in China is expected to remain stable
during the forecast period; (ii) relevant key drivers are likely to drive the continued growth of
China’s AI solution market throughout the forecast period; and (iii) there is no extreme force
majeure or unforeseen industry regulation in which the industry may be affected in either a
dramatic or fundamental way. All forecasts in relation to market size are based on the general
economic conditions as of the Latest Practicable Date.
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Information disclosed in this section is relevant PRC laws, regulations and
regulatory documents in effect which have a significant impact on our operations in the
PRC as of the date of this Document (hereinafter referred to as “PRC Laws”), which are
subject to change in the future, but it does not include a detailed analysis of PRC Laws
related to our business activities and operations in the PRC, or serve as all PRC Laws
applicable to our operations in the PRC.
REGULATIONS AND POLICIES ON INFORMATION INDUSTRY
Policies on Artificial Intelligence
In accordance with the Notice of the State Council on Promulgating “Made in China
2025” Plan (Ι೯
ʕ਷Ⴁி2025) which was promulgated by the
State Council on May 8, 2015 and came into effect on the same date, to fully implement the
intention of the 18th National Congress of CPC and the Second, Third and Fourth Plenary
Sessions of the 18th Central Committee of the CPC and adhere to the path of new
industrialization with Chinese characteristics, the promotion of integrated development of the
next generation information technology and manufacturing technology and regard intelligent
manufacturing are the main directions of comprehensive integration of informationization and
industrialization. And efforts should be made to develop intelligent equipment and intelligent
products, promote intelligent production process, cultivate new production methods, and
comprehensively enhance the intelligent level of research and development, production,
management and service of enterprises.
The Development Plan of New Generation Artificial Intelligence (࢝
஝ྌ) which was promulgated by the State Council on July 8, 2017 and came into effect on
the same date, according to which, the State accelerates the cultivation of an artificial
intelligence industry with a major leading role, promote the in-depth integration of artificial
intelligence and various industrial fields, and form a data-driven, human-machine
collaboration, cross-border integration, and co-creation and sharing of intelligent economic
forms. Data and knowledge have become the first element of economic growth, human-
machine collaboration has become the mainstream mode of production and service, cross-
border integration has become an important economic model, co-creation and sharing has
become a basic feature of economic ecology, personalized demand and customization have
become a new trend in consumption. Develop key basic software such as artificial intelligence-
oriented operating systems, databases, middleware, and development tools, break through core
hardware such as graphics processors, and study image recognition, speech recognition,
machine translation, intelligent interaction, knowledge processing, control decision-making
and other intelligent system solutions and cultivate and expand the basic software and
hardware industries for artificial intelligence applications.
REGULATORY OVERVIEW
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The Guidelines for the Construction of the National New Generation of AI Open
Innovation Platform (ˏ), promulgated by
Ministry of Science and Technology of the People’s Republic of China on August 1, 2019 and
came into effect on the same date, pointed out that “open and sharing” shall be the important
philosophy in promoting artificial intelligence innovation and industry development in China,
and encouraged to open innovation platforms for companies to do testing, and thus to form
standard and modularized models, middleware and applications for providing services to the
public in the form of open interfaces, model libraries, algorithm packages, etc.
The Guidelines for the Construction of the National New Generation Artificial
Intelligence Innovation and Development Pilot Zone (༊᜕ਜ
ˏ), promulgated by Ministry of Science and Technology of the People’s
Republic of China on August 29, 2019, amended on September 29, 2020 and came into effect
on the same date, underlines that an environment conducive to the innovation and development
of artificial intelligence shall be created, as well as to promote the construction of artificial
intelligence infrastructure and strengthen the conditional support for the innovation and
development of artificial intelligence.
Regulations on the Application of Artificial Intelligence Technologies
The Administrative Provisions on Deep Synthesis in Internet-based Information Services
(֛which was promulgated by the CAC on November 25,
2022 and took effective since January 10, 2023, impose certain compliance obligations upon
service providers using deep synthesis technology to provide Internet-based information
services, including but not limited to establishing a database to identify illegal or adverse
information, adding tags on information generated from using deep synthesis technologies,
authenticating users’ real identities before allowing them to use deep synthesis information
publishing services, etc. Deep synthesis technologies are defined as technologies that utilize
algorithms, such as deep learning and virtual reality, to synthesize or generate text, photo,
audio, video, or virtual scenes. Importantly, this regulatory document extends the applicable
scope of record filing obligations from certain service providers to technical supporters. It
requires the technical supporters of deep synthesis technology (the organizations or individual
that provide technical supports for deep synthesis services) to file for record with CAC’s
algorithm record-filing system and disclose the information regarding the algorithm data,
algorithm models, algorithm strategies and algorithm risk and prevention mechanisms, as well
as how the technical supports are provided, such as name of the technical services, the access
methods, the recipients of the technical supports, and the frequency of technical services.
On July 13, 2023, the CAC and six other ministries jointly published the Interim
Administrative Measures on Generative AI Services (ج)
Interim Measures on GAI”), which came into effect on August 15, 2023. The Interim
Measures on GAI apply to the provision of generating content such as text, images, audio and
video to the public within the territory of China by utilizing generative AI technology (“GAI
Service”). On the other hand, Interim Measures on GAI will not apply to industrial
organizations, enterprises, educational and scientific research institutions, public cultural
institutions, and relevant professional institutions that develop and apply generative AI
technologies but do not provide GAI Services to the public within China.
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The Interim Measures on GAI impose various obligations on GAI service providers, from
content filtering and control to protecting the personal data of users, mainly including:
(i) Providers will be responsible as generators of the generated content. Upon
discovering any “illegal content”, the providers should promptly take measures such
as terminating generation or terminating transmission in order to dispose of such
content, optimize and train the models to rectify, and report the same to the
authorities. They must add tags to generated content such as images and videos.
(ii) Providers must protect users’ personal information, input data and usage records,
and are forbidden from (x) collecting personal information beyond the necessary
scope for providing services; (y) unlawfully retaining input data and usage records
which could be used to identify users; or (z) unlawfully providing users’ input data
and usage records to other parties.
(iii) Providers must publish details of suitable users, use scenarios and usages, and guide
users to use their GAI Services in a lawful and reasonable manner. They must also
take effective measures to prevent minors from overly relying on or becoming
addicted to GAI Services.
(iv) If discovering that a user is making use of GAI Services for unlawful purposes,
providers must take control measures such as giving warnings, restricting functions,
suspending, or terminating services, maintaining records, and reporting such usage
to the authorities.
Interim Measures on GAI provide special requirements for data training activities such as
pre-training and fine-tuning:
(i) to use data and base models from legal sources;
(ii) not to infringe others’ intellectual property rights where intellectual property is
involved;
(iii) to obtain consents from individuals or ensure that other conditions provided by laws
and regulations are met if personal information is used;
(iv) to take measures to improve the quality of training data and enhance the authenticity,
accuracy, objectivity and diversity of training data; and
(v) to comply with the requirements of relevant laws.
In addition, Interim Measures on GAI require the providers to conduct security
assessment for provision of GAI Services with “public opinion attributes or social mobilization
capabilities”, and file for records with the CAC according to the Administrative Provisions on
Recommendation Algorithms in Internet-based Information Services.
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Regulations on Computer Software
In accordance with the Regulations on the Protection of Computer Software (ၑዚழ
ᚐૢԷ) promulgated by the State Council on June 4, 1991 and latest amended on
January 30, 2013, with the latest revision effective on March 1, 2013, Chinese citizen, legal
person or other organization is entitled under the copyright of the software he/it has developed,
including the right of publication, right of acknowledgement, right of alteration, right of
reproduction, right of distribution, right of leasing, right of dissemination, right of translation
and other rights that software copyright owners shall have, regardless of whether such software
has been published.
In accordance with the Measures for Registration of Computer Software Copyright (ࠇ
) promulgated by the National Copyright Administration on April
6, 1992 and latest amended on February 20, 2002, with the latest revision effective on the same
date, software copyrights, exclusive software copyright licensing contracts and transfer
contracts shall be registered, and the National Copyright Administration shall be the competent
authority for the administration of software copyright registration and has certified the China
Copyright Protection Centre as the institution responsible for software registration.
Applications that comply with the rules shall be granted registration, and a corresponding
registration certificate shall be issued by the China Copyright Protection Centre.
National Catalogue for Guidance on Industrial Restructuring
In accordance with the National Catalogue for Guidance on Industrial Restructuring
(2024 Version) (ኬͦ፽(2024 ϋ͉)) which was promulgated by the
National Development and Reform Commission (the “NDRC”) on December 27, 2023 and
came into effect on February 1, 2024, big data, cloud computing, software and information
technology service and blockchain information services within the extent permitted by PRC are
under the encouraged category.
Outline of the 14th Five-Y ear Plan for National Economic and Social Development
The Outline of the 14th Five-Year Plan for National Economic and Social Development
of the People’s Republic of China and Outlines of Objectives in Perspective of the Year
2035 (ʞϋ஝ྌձ2035),
promulgated by the Standing Committee of the National People’s Congress on March 11, 2021
and came into effect on the same date, points out the focus of key areas include high-end chips,
operating systems, key artificial intelligence algorithms, sensors, and PRC shall speed up
technology R&D, and make breakthroughs in basic theories, basic algorithms, and equipment
materials.
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Policies on the Software Industry
The Several Policies on Further Encouraging the Development of the Software and
Integrated Circuit Industries (ഄ) which
was promulgated by the State Council on January 28, 2011 and came into effect on the same
date, specifies a series of policies on tax preference, promotion of investment and scientific
research and talent support for the software industry.
REGULATIONS RELATING TO INTERNET INFORMATION SECURITY AND
PRIV ACY PROTECTION
In accordance with the Law of the Cybersecurity Law of the People’s Republic of China
() which was promulgated by the Standing Committee of the
National People’s Congress on November 7, 2016 and came into effect on June 1, 2017, PRC
adopts graded system for cybersecurity protection, under which network operators are required
to perform the obligations of security protection to ensure that the network is free from
interference, disruption or unauthorized access, and prevent network data from being disclosed,
stolen or tampered. In the event that the network operator fails to fulfill obligation concerning
graded system for cybersecurity protection, the competent authority shall warn such operator
and order it to make rectifications. A fine ranging from RMB10,000 to RMB100,000 shall be
imposed on such operator if it refuses to make rectifications or in case of consequential severe
damage to the network, and a fine ranging from RMB5,000 to RMB50,000 shall be imposed
on the supervisor directly in charge.
In accordance with the Administrative Measures for the Hierarchical Protection of
Information Security () which was promulgated by the
Ministry of Public Security, State Secrecy Administration, State Cryptography Administration,
and the Information Office of the State Council on June 22, 2007 and came into effect on the
same date, and the Guide for the Grading of Information Security and Cybersecurity (ࢹڦ
), which was promulgated by Standardization
Administration of the PRC on April 28, 2020 and came into effect on November 1, 2020, the
hierarchical protection of the information security at the national level shall follow the
principle of “independent grading and independent protection”. Accordingly, the security
protection grade of the information system shall be determined by entities operating and using
an information system in accordance with the applicable rules. And in the cloud computing
environment, based on different service modes, the cloud computing platform/system is
divided into different grading objects.
In accordance with the State Security Law of the People’s Republic of China ( ʕശɛ
) which was promulgated by Standing Committee of the National
People’s Congress on February 2, 1993 and latest amended on July 1, 2015, with the latest
revision effective on the same date, the PRC government 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
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information core technologies, critical infrastructure and information systems and data in key
areas; the PRC government 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.
In accordance with the Criminal Law of the People’s Republic of China ( ʕശɛ͏΍
) which was promulgated by the National People’s Congress on July 6, 1979,
December 26, 2020 and latest amended on December 29, 2023, with the latest revision
effective on March 1, 2024, a network service provider is subject to criminal liability if such
network service provider fails to perform such obligation to manage information network
security as specified by laws and administrative regulations, and refuses to make corrections
when is ordered by a supervisory authority to do so, and involves any of the specified serious
cases.
In accordance with the Data Security Law of the People’s Republic of China ( ʕശɛ
) which was promulgated by the Standing Committee of the National
People’s Congress on June 10, 2021 and came into effect on September 1, 2021, PRC protects
the rights and interests of individuals and organizations relating to data, encourages the lawful,
reasonable and effective use of data, guarantees the orderly and free flow of data in accordance
with the law, and promotes the development of the digital economy with data as a key element.
And PRC establishes a data classification and hierarchical protection system and data security
review system, under which data processing activities that affect or may affect national security
shall be reviewed for national security. A decision on security review made in accordance with
the law shall be final. Processors of important data shall establish a sound data security
management system throughout the whole process, organize data security education and
training, and take corresponding technical measures and other necessary measures to ensure
data security, in accordance with the provisions of laws and regulations. To carry out data
processing activities by making use of the Internet or any other information network, the
aforesaid obligations for data security protection shall be performed on the basis of the graded
protection system for cybersecurity. Provided that the national core data management system
is violated, which endangers the sovereignty, security and development interests of PRC, the
relevant competent authority will impose a fine of not less than RMB2 million but not more
than RMB10 million, and may order suspension of the relevant business, stop the business for
rectification, and revoke the relevant business permit or business license as the case may be;
if a crime is constituted, criminal liability will be investigated in accordance with the law.
On November 14, 2021, the CAC released the Network Data Security Management
Regulations (Draft for Comment) (the “Draft Regulations”) ( ၣഖᅰኽτΌ၍ଣૢԷ(ᅄӋจ
Ԉᇃ)). The Draft Regulations, among other things, stipulates that (i) data processors possess
personal information of more than one million users seeking a public listing in a foreign
country, and (ii) data processors seeking a public listing in Hong Kong that influence or may
influence national security, must apply for a cybersecurity review, in accordance with the
relevant stipulations of the State. On 28 December 2021, the CAC and other twelve PRC
regulatory authorities jointly revised and promulgated the Cybersecurity Review Measures
(), which came into effect on 15 February 2022, and the Measures for
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Cybersecurity Review () which took effect on 1 June 2020 was
abolished at the same time. The Cybersecurity Review Measures provides that, among others,
(i) the purchase of cyber products and services by critical information infrastructure operators
(the “CIIOs”) and the network platform operators (the “Network Platform Operators”) which
engage in data processing activities that affects or may affect national security shall be subject
to the cybersecurity review by the Cybersecurity Review Office, the department which is
responsible for the implementation of cybersecurity review under the CAC; and (ii) the
Network Platform Operators with personal information data of more than one million users that
seek for listing in a foreign country are obliged to apply for a cybersecurity review by the
Cybersecurity Review Office. At present, the Draft Regulations had only been released for
consultation purposes, and this requirement is newly included in the Draft Regulations, as such
there still remain uncertainties as to its final content, anticipated adoption or effective date,
final interpretation and implementation, and other aspects.
REGULATIONS ON OVERSEAS LISTING
Recently, certain PRC regulatory authorities issued Opinion on Severely Punishing Illegal
Activities in Securities Market (จԈ), which were
available to the public on July 6, 2021, further emphasized to strengthen cross-border
regulatory collaboration, to improve relevant laws and regulations on data security, cross-
border data transmission, and confidential information management, and provided that efforts
will be made to revise the regulations on strengthening the confidentiality and archive
management relating to the offering and listing of securities abroad, to implement the
responsibility on information security of companies listed in foreign countries, and to
strengthen the standardized management of cross-border information provision mechanisms
and procedures.
On February 17, 2023, the CSRC promulgated the Trial Administrative Measures of
Overseas Securities Offering and Listing by Domestic Enterprises ( ྤʫΆุྤ̮೯БᗇՎ
) (the “Trial Administrative Measures”) and five supporting guidelines,
which has become effective on March 31, 2023. Pursuant to the Trial Administrative Measures,
PRC domestic enterprises that directly or indirectly offer or list their securities in an overseas
market, which include (i) any PRC company limited by shares, and (ii) any offshore company
that conducts its business operations primarily in China and contemplates to offer or list its
securities in an overseas market based on its onshore equities, assets or similar interests, are
required to file with the CSRC within three business days after its application for overseas
listing is submitted. Failure to complete the filing under the Trial Administrative Measures may
subject a PRC domestic enterprise to rectification ordered by the CSRC, warning, and fine of
RMB1 million to RMB10 million.
On the same date, the CSRC promulgated the Notice on the Arrangement for the
Filing-based Administration of Overseas Securities Offering and Listing by Domestic
Enterprises () (the “Arrangement for
Filing-based Administration”). According to the Arrangement for Filing-based Administration,
PRC domestic enterprises shall not be required to complete the filing procedures if all of the
following conditions are met: (i) the application for indirect overseas offering or listing shall
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have been approved by the overseas regulatory authorities or the overseas stock exchanges (for
example, a contemplated offering and/or listing in Hong Kong has passed the hearing) prior to
the effective date of the Trial Administrative Measures; (ii) it is not required to re-perform the
overseas regulatory procedures for overseas securities offering and listing; (iii) such overseas
securities offering or listing shall be completed before September 30, 2023. From March 31,
2023, domestic enterprises that have submitted valid applications for overseas offerings and
listings but have not obtained the approval from overseas regulatory authorities or overseas
stock exchanges shall complete the filing procedures with the CSRC prior to their overseas
offerings and listings.
REGULATIONS ON ESTABLISHMENT OF COMPANIES AND FOREIGN
INVESTMENT
In accordance with the Foreign Investment Law and the Implementation Regulations for
the Foreign Investment Law of the People’s Republic of China (ج
ૢԷ) (hereinafter referred to as “Regulations”), which was promulgated by the State
Council on December 26, 2019 and came into effect on January 1, 2020, any discrepancy
between the Foreign Investment Law and these Regulations and the provisions on foreign
investments formulated before January 1, 2020, the provisions of the Foreign Investment Law
and these Regulations shall prevail. Investments by foreign investors in fields for which
investment is restricted by the Negative List shall comply with the restrictive admission special
administrative measures such as equity requirements, senior management personnel
requirements stipulated by the Negative List.
In accordance with the Measures on Reporting of Foreign Investment Information ( ̮
), which was promulgated by the Ministry of Foreign Trade and
Commerce (the “MOFCOM”) and State Administration for Market Regulation on
December 30, 2019 and came into effect on January 1, 2020, foreign investors or foreign
investment enterprises shall submit investment information to the commerce administrative
authorities through the Enterprise Registration System and the National Enterprise Credit
Information Publicity System. In accordance with the Measures for the Security Review of
Foreign Investments (), which was promulgated by the NDRC and
MOFCOM on December 19, 2020 and came into effect on January 18, 2021, the office of the
working mechanism for the security review of foreign investments is set up under the NDRC,
which is led by the NDRC and the MOFCOM to undertake he routine work of the security
review of foreign investments.
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REGULATION ON FOREIGN INVESTMENT RESTRICTIONS
Investment activities in the PRC by foreign investors are principally governed by the
Industry Catalog Relating to Foreign Investment ( ̮ਠҳ༟ପุͦ፽), or the Catalog,
which was promulgated and is amended from time to time by the MOFCOM and the NDRC.
The Catalog divides industries into three categories: encouraged, restricted and prohibited.
Industries not listed in the Catalog are generally deemed as constituting a fourth “permitted”
category and open to foreign investment unless specifically restricted by other PRC
regulations. Industries such as value-added telecommunication services are restricted to
foreign investment.
On December 27, 2021, the MOFCOM and the NDRC promulgated the Special
Management Measures (Negative List) for the Access of Foreign Investment (ɝ
݄(૶ఊ)), or the Negative List (2021), which became effective on
January 1, 2022. The Negative List (2021) expands the scope of industries in which foreign
investment is permitted by reducing the number of industries that fall within the Negative List
(2021). Foreign investment in V ATS (other than e-commerce, domestic multi-party
communications, store-and-forward and call center) still falls within the Negative List (2021).
According to the Administrative Regulations on Foreign-Invested Telecommunications
Enterprises () issued by the State Council on December 11,
2001 and amended on September 10, 2008, February 6, 2016 and March 29, 2022 respectively,
foreign-invested value-added telecommunications enterprises must be in the form of a
Sino-foreign equity joint venture. The regulations restrict the ultimate capital contribution
percentage held by foreign investor(s) in a foreign-invested value-added telecommunications
enterprise to 50% or less.
On July 13, 2006, the Ministry of Industry and Information Technology (the “MIIT”)
issued the Circular of the Ministry of Information Industry on Strengthening the
Administration of Foreign Investment in Value-added Telecommunications Business (ପ
), or the MIIT Circular, according to
which, a foreign investor in the telecommunications service industry in China must establish
a foreign invested enterprise and apply for a telecommunications businesses operation license.
The MIIT Circular further requires that: (i) PRC domestic telecommunications business
enterprises must not, through any form, lease, transfer or sell a telecommunications businesses
operation license to a foreign investor, or provide resources, offices and working places,
facilities or other assistance to support the illegal telecommunications services operations of a
foreign investor; (ii) value-added telecommunications business enterprises or their
shareholders must directly own the domain names and trademarks used by such enterprises in
their daily operations; (iii) each value-added telecommunications business enterprise must
have the necessary facilities for its approved business operations and to maintain such facilities
in the regions covered by its license; and (iv) all V ATS providers are required to maintain
network and internet security in accordance with the standards set forth in relevant PRC
regulations. If a license holder fails to comply with the requirements in the MIIT Circular and
cure such non-compliance, the MIIT or its local counterparts have the discretion to take
measures against such license holder, including revoking its value-added telecommunications
business operation license.
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REGULATIONS RELATED TO V ALUE-ADDED TELECOMMUNICATIONS
BUSINESS
Among all of the applicable laws and regulations, the Telecommunications Regulations of
the People’s Republic of China (ૢԷ) (the “Telecom Regulations”),
promulgated by the State Council on September 25, 2000 and amended on July 29, 2014 and
February 6, 2016 respectively, is the primary governing law, and sets out the general
framework for the provision of telecommunications services by domestic PRC companies.
Under the Telecom Regulations, telecommunications service providers are required to procure
operating licenses prior to their commencement of operations. The Telecom Regulations
distinguishes basic telecommunications services from Value-Added Telecommunications
Service (the “V ATS”).
The Telecom Catalogue (ุਕʱᗳͦ፽), was issued as an attachment to the
Telecom Regulations to categorize telecommunications services as either basic or value-added.
The Telecom Catalogue amended on December 28, 2015 (which became effective on March 1,
2016 and was further amended on June 6, 2019), or the 2015 Telecom Catalogue, categorizes
internet data centers, online data and transaction processing, on-demand voice and image
communications, domestic internet virtual private networks, message storage and forwarding
(including voice mailbox, e-mail and online fax services), call centers, internet access and
online information and data search, among others, as V ATS. Under the 2015 Telecom
Catalogue, “fixed network domestic data transmission services” is categorized as a basic
telecommunications business and defined as “a domestic end-to-end data transfer business by
wired mode under fixed-net, except for the internet data transfer business” and the “domestic
internet virtual private networks service” and “internet access services” are categorized as
value-added telecommunications business that “domestic internet virtual private networks
service” is defined as “a customization business of internet closed user group network for
domestic users by self-owned or leased internet network resources of the operators and
adopting TCP/IP agreement.” And “internet access services” is defined as “Access servers and
corresponding hardware and software resources are used to establish service nodes, and public
communication infrastructure is used to connect the service nodes to the Internet backbone
network to provide access to the Internet for all types of users. Users can connect to their
service nodes using the public communication network or other access means and access the
Internet through the node.”
On March 1, 2009, the MIIT promulgated the Administrative Measures for
Telecommunications Business Operating License (), or the
original Telecom License Measures, which became effective on April 10, 2009. The original
Telecom License Measures set forth the types of licenses required to provide
telecommunications services in China and the procedures and requirements for obtaining such
licenses. With respect to licenses for value-added telecommunications businesses, the original
Telecom License Measures distinguish between licenses for business conducted in a single
province, which are issued by the provincial-level counterparts of the MIIT and licenses for
cross-regional businesses, which are issued by the MIIT. The licenses for foreign invested
telecommunications business operators need to be applied with MIIT. An approved
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telecommunications services operator must conduct its business in accordance with the
specifications stated on its telecommunications business operating license. Pursuant to the
original Telecom License Measures, cross-regional V ATS licenses shall be approved and issued
by the MIIT with five-year terms. On July 3, 2017, the MIIT issued the Telecom License
Measures (), which became effective on September 1, 2017
and replaced the original Telecom License Measures. The changes mainly include among
others, (i) the establishment of a telecommunications business integrated management online
platform; (ii) provisions allowing the holder of a telecommunications business license to
authorize a company, of which such license holder holds at least 51% of the equity interests
indirectly, to engage in the relevant telecommunications business; and (iii) the cancellation of
the requirement of an annual inspection of telecommunications business licenses, instead
requiring license holders to complete an annual report.
On January 17, 2017, the MIIT issued the Circular of the Ministry of Industry and
Information Technology on Clearing up and Regulating the Internet Access Service Market
(), or the 2017 MIIT
Circular, according to which the MIIT determined to clear up and regulate the internet access
service market nationwide from the issuance date of the 2017 MIIT Circular until March 31,
2018. The 2017 MIIT Circular provides, among others, that (i) an enterprise that holds the
corresponding telecom business license, including the relevant V ATS license, shall not provide,
in the name of technical cooperation or other similar ways, qualifications or resources to any
unlicensed enterprises for their illegal operation of the telecom business, (ii) if an enterprise
with its IDC license obtained prior to the implementation of 2015 Telecom Catalogue issued
on March 1, 2016, has actually carried out internet resources collaboration services, it shall
make a written commitment to its original license issuing authority before March 31, 2017 to
meet the relevant requirements for business licensing and obtain the corresponding telecom
business license by the end of 2017, failure of which will result in such enterprise not being
able to continue operating the business of internet resources collaboration services as it
currently does as of January 1, 2018, and (iii) without the approval of the MIIT, enterprises are
not allowed to carry out cross-border business operations by setting up on its own or leasing
private network circuits (including virtual private networks, or VPNs) or other information
channels.
On January 6, 2014, the Ministry of Industry and Information Technology and the
Shanghai Municipal People’s Government issued the Opinions on Further Opening up Value
Added Telecommunications Services in the China (Shanghai) Pilot Free Trade Zone ( ʈุձ
ʕ਷ (ɪऎ)ٙ
จԈ). The opening policy for value-added telecommunications services in the China
(Shanghai) Pilot Free Trade Zone is: (i) In the information service business and the
storage-forwarding business that have opened up according to China’s WTO commitments and
in which the ratio of equity held by foreign investors is not more than 50%, the ratio of equity
held by foreign investors may exceed 50% on a trial basis. However, the information service
business merely includes app stores; (ii) Four types of business will be added to the pilot
programs of opening up: call center business, domestic multi-party communication service,
Internet access service (providing access services for Internet users), and domestic Internet
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virtual private network business. In call center business, domestic multi-party communication
service, and Internet access service (providing access services for Internet users), the ratio of
equity held by foreign investors may exceed 50%, while the ratio of equity held by foreign
investors in domestic Internet virtual private network business may not exceed 50%.
On December 27, 2021, the National Development and Reform Commission and the
Ministry of Commerce issued special management measures for foreign investment access in
free trade pilot zones (negative list) (݄(૶
ఊ)). According to which the pilot policy of the original area (28.8 square kilometers) of the
China (Shanghai) Pilot Free Trade Zone has been promoted to all pilot free trade zones of PRC
for implementation.
REGULATIONS ON INTELLECTUAL PROPERTY RIGHTS
Patent
In accordance with the Patent Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷
) which was promulgated by the Standing Committee of the National People’s
Congress on March 12, 1984 and latest amended on October 17, 2020, with the latest revision
effective on June 1, 2021, the Implementation Regulations for the Patent Law of the People’s
Republic of China () which was promulgated by the State
Council on December 21, 1992, January 9, 2010 and latest amended on December 11, 2023,
with the latest revision effective on January 20, 2024, and the Public Announcement on
Measures on Filing of Patent Licensing Contracts () which
was promulgated by the State Intellectual Property Office on June 27, 2011 and came into
effect on August 1, 2011, patent in PRC shall be categorized as invention, utility model and
design. The duration of patent rights for an invention shall be 20 years, the duration of patent
rights for a utility model shall be 10 years and the duration of patent rights for a design shall
be 15 years, commencing from the filing date. Any organization or individual proposing to
implement the patent of others shall enter into a licensing contract with the patentee for
implementation and pay royalties to the patentee. And the State Intellectual Property Office
shall be responsible for filing of patent licensing contracts nationwide. The parties concerned
shall complete filing formalities within three months from the effective date of a patent
licensing contract.
Trademark
In accordance with the Trademark Law of the People’s Republic of China ( ʕശɛ͏΍
) which was promulgated by Standing Committee of the National People’s
Congress on August 23, 1982, and was latest amended on April 23, 2019, with the latest
revision effective on November 1, 2019, and the Implementation Regulations for the
Trademark Law of the People’s Republic of China (ૢԷ)
which was promulgated by the State Council on August 3, 2002 and was latest amended on
April 29, 2014, with the latest revision effective on May 1, 2014, trademarks approved and
registered by the trademark bureau are registered trademarks, including commodity
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trademarks, service marks and collective trademarks, certification marks; trademark registrants
are entitled to exclusive rights to use trademark and are protected by the law. A registered
trademark shall be valid for 10 years, commencing from the date of registration. Use of a
trademark identical or similar to a registered trademark on the same type of commodities
without licensing by the trademark registrant shall be deemed as infringement of exclusive
rights to use registered trademarks.
Domain Name
In accordance with the Administrative Measures on Internet Domain Names ( ʝᑌၣਹ
) which was promulgated by the Ministry of Industry and Information
Technology of the People’s Republic of China on August 24, 2017 and came into effect on
November 1, 2017, the Implementing Rules for the Registration of National Top-level Domain
Names () and Procedural Rules for Resolution of Disputes
over National Top-level Domain Names () which were
promulgated by China Internet Network Information Center on June 18, 2019 and came into
effect on the same date, the domain name registration services shall in principle implement
“first apply first register”; where the corresponding detailed rules for domain name registration
stipulate otherwise, such provisions shall prevail. The applicant shall be deemed as domain
name holder via registration. The domain name disputes shall be accepted and solved by a
domain name dispute resolution body as recognized by the China Internet Network Information
Center.
In accordance with the Notice of the Ministry of Industry and Information Technology on
Regulating the Use of Domain Names in Providing Internet-based Information Services ( ʈ
) (hereinafter referred to as
“Notice”), which was promulgated by the Ministry of Industry and Information Technology of
the People’s Republic of China on November 27, 2017 and came into effect on January 1, 2018,
the Internet access service provider concerned shall check the real identity information of the
domain name registrant via the Record-filing System, and shall not provide access services if
the Internet-based information service provider fails to provide real identity information or the
identity information provided is inaccurate or incomplete, with the exception of domain names
that have been filed for record with the Record-filing System prior to the effectiveness of this
Notice.
Copyright
In accordance with the Copyright Law of the People’s Republic China ( ʕശɛ͏΍ձ
) which was promulgated by Standing Committee of the National People’s
Congress on September 7, 1990 and latest amended on November 11, 2020, with latest revision
effective on June 1, 2021, Chinese citizens, legal persons or organizations without legal
personality enjoy copyright over their works, whether published or not, including written
works; oral works; musical, dramatic, opera, dance, acrobatic artistic works; fine arts,
architectural works; photographic works; audio-visual works; graphic works and model works,
such as engineering design plan, product design plan, map, schematic diagram, etc.; computer
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software and any other intellectual achievements which comply with the characteristics of the
works. Copyright shall include the following personal rights and property rights: publication
right, right of authorship, right of revision, right to preserve the integrity of work, reproduction
right, distribution right, rental right, exhibition right, performance right, screening right,
broadcasting right, information network transmission right, filming right, adaptation right,
translation right, compilation right, and any other rights enjoyed by a copyright holder.
REGULATIONS IN RELATION TO TAX
Enterprise Income Tax
In accordance with the Enterprise Income Tax Law of the People’s Republic of China
() which was promulgated by the Standing Committee of the
National People’s Congress on March 16, 2007, and was latest amended on December 29,
2018, with the latest revision effective on the same date and the Implementation Regulations
for the Enterprise Income Tax Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷Άุ
ૢԷ) which was promulgated by the State Council on December 6, 2007, and
was latest amended on April 23, 2019, with the latest revision effective on the same date, a
uniform income tax rate of 25% will be applied to resident enterprises and non-resident
enterprises that have established institutions and premises in China. Besides enterprises
established within the PRC, enterprises established in accordance with the laws of other
judicial districts whose “de facto management bodies” are within the PRC are considered
“resident enterprises” and subject to the uniform 25% enterprise income tax rate for their
income derived from both inside and outside the PRC. Corporate income tax for key advanced
and new technology enterprises supported by PRC shall be at a reduced tax rate of 15%.
In accordance with the Administrative Measures on Accreditation of High-tech
Enterprises () which was promulgated by the Ministry of
Science and Technology, the Ministry of Finance and the State Administration of Taxation on
April 14, 2008 and amended on January 29, 2016 and came into effect on January 1, 2016,
high-tech enterprises referred to in these Measures shall mean resident enterprises registered
in China (excluding Hong Kong, Macau and Taiwan) which are continuously engaging in
research and development and technology commercialization within the realm of the Regions
of Advanced Technologies Strongly Supported by PRC, forming the core independent
intellectual property of the enterprise, and carrying out business activities on such basis, which
accredited pursuant to these Measures may declare and claim tax incentives pursuant to the
Enterprise Income Tax Law (جand its Implementation
Regulations, the Administrative Law of the People’s Republic of China on the Levying and
Collection of Taxes, the Implementation Regulations for the Law of the People’s Republic of
China on Administration of Tax Collection (ۆetc.
Upon obtaining the qualification as a high-tech enterprise, the enterprise shall complete tax
reduction and exemption formalities with the tax authorities in charge and the qualifications of
an accredited high-tech enterprise shall be valid for three years from the date of issuance of the
certificate.
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Value-added Tax
In accordance with the Provisional Regulations of the People’s Republic of China on
Value-added Tax (೼ᅲБૢԷ) which was promulgated by the State
Council on December 13, 1993, and was latest amended on November 19, 2017, with the latest
revision effective on the same date, the Detailed Rules for the Implementation Rules for the
Provisional Regulations the People’s Republic of China on Value-added Tax ( ʕശɛ͏΍ձ
) which was promulgated by the Ministry of Finance on
December 25, 1993, and was latest amended on October 28, 2011, with the latest revision
effective on November 1, 2011, In accordance with the Decisions on Abolishing the PRC
Provisional Regulations on Business Tax and Amending the PRC Provisional Regulations on
Value-Added Tax (ᄻ˟<ʕശɛ͏΍ձ਷ᐄุ೼ᅲБૢԷ>ҷ<ʕശɛ͏΍
೼ᅲБૢԷ>) which was promulgated by the State Council and effective on
November 19, 2017 and the Notice of the Ministry of Finance and the State Administration of
Taxation on the Adjustment to V AT Rates ()
which was promulgated by the Ministry of Finance and the State Administration of Taxation
on April 4, 2018 and came into effect on May 1, 2018, entities and individuals selling goods,
services and intangible assets in the People’s Republic of China are V AT taxpayers and shall
pay value-added tax. Taxpayers selling services and intangible assets are subject to a tax rate
of 6%, except in particular circumstances. If a taxpayer is engaged in sale subject to V AT at
the previously applicable rate of 17%, the tax rate is reduced to 16%. In accordance with the
Announcement on Policies for Deepening the V AT Reform which was issued by the Ministry
of Finance, State Taxation Administration and General Administration of Customs (ଉ
ʮѓ) on March 20, 2019 and came into effect on April 1, 2019. If
a general V AT taxpayer is engaged in a V AT taxable sale or imports goods at the previously
applicable rate of 16%, the tax rate is reduced to 13%.
In accordance with the Notice of Ministry of Finance and State Administration of
Taxation on Value-added Tax Policies for Software Products (ٝ)
which was promulgated by the Ministry of Finance and the State Administration of Taxation
on October 13, 2011 and came into effect on January 1, 2011, a value-added tax general
taxpayer selling software products developed and produced by itself shall be subject to levying
and collection of value-added tax at the tax rate of 17%, and the policy of forthwith levy and
forthwith refund shall be implemented for the portion of value-added tax actually paid which
exceeds 3%.
Urban Maintenance and Construction Tax
In accordance with Urban Maintenance and Construction Tax Law of People’s Republic
of China () which was promulgated by Standing
Committee of National Peoples Congress on August 11, 2020 and came effect on September 1,
2021 and the Notice of the State Council on Harmonizing the Urban Maintenance and
Construction Tax and Educational Surcharges for Chinese and Foreign-funded Enterprises and
Individuals (ஷ
) which was promulgated by the State Council on October 18, 2010 and latest effective on
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December 1, 2010, entities and individuals which are subject to consumption tax, V AT and
business tax shall pay urban maintenance and construction tax. The tax rate is 7% for a
taxpayer who is domiciled in a downtown area, and 5% for a taxpayer who is domiciled in a
county or town, and 1% for a taxpayer who is domiciled outside a downtown area, county or
town.
REGULATIONS ON LABOR
Labor Relations
The Labor Contract Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷௶ਗΥΝ
) which was promulgated by Standing Committee of the National People’s Congress on
June 29, 2007, and was latest amended on December 28, 2012, with the latest revision effective
on July 1, 2013, governs the establishment of labor relationships between enterprises,
individual economic organizations, private non-enterprise entities etc., in the PRC and their
workers and the conclusion, performance, variation, rescission or termination of labor
contracts, specifies relevant detailed requirements on terms and contents of labor contracts
signed between the parties, and stipulates the maximum working hours per day and week and
the monthly minimum wage.
Social Insurance and Housing Provident Fund
In accordance with the Social Insurance Law of the People’s Republic of China ( ʕശ
) which was promulgated by Standing Committee of the National
People’s Congress on October 28, 2010 and was latest amended on December 29, 2018, with
the latest revision effective on the same date, employers are required to contribute, on behalf
of their employees, to a number of social security funds, including funds for basic pension
insurance, unemployment insurance, basic medical insurance, occupational injury insurance,
and maternity insurance. Employers failed to promptly contribute social security premiums in
full amount shall be ordered by the social security premium collection agency to make or
supplement contributions within a stipulated period, and shall be subject to a late payment fine
computed from the due date at the rate of 0.05% per day; where payment is not made within
the stipulated period, the relevant administrative authorities shall impose a fine ranging from
one to three times the amount of the amount in arrears.
In accordance with the Regulations on the Administration of Housing Provident Fund
(၍ଣૢԷ) which was promulgated by the State Council on April 3, 1999, and
was latest amended on March 24, 2019, with the latest revision effective on the same date, an
employer shall make registration of contribution to the housing provident fund with the
housing provident fund management center, and go through the formalities of opening housing
provident fund accounts on behalf of its employees. And an employer fails to undertake
contribution registration of housing provident fund or fails to go through the formalities of
opening housing provident fund accounts for its employees, the housing provident fund
management center shall order it to go through the formalities within a prescribed time limit;
where failing to do so at the expiration of the time limit, a fine of not less than RMB10,000
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nor more than RMB50,000 shall be imposed. An employer is overdue in the contribution of,
or underpays, the housing provident fund, the housing provident fund management center shall
order it to make the contribution within a prescribed time limit; where the contribution has not
been made after the expiration of the time limit, an application may be made to a people’s court
for compulsory enforcement.
REGULATIONS ON FOREIGN EXCHANGE ADMINISTRATION
General Foreign Exchange Administration
The Foreign Exchange Control Regulations of the People’s Republic of China ( ʕശɛ
͏΍ձ਷̮ි၍ଣૢԷ), promulgated by the State Council on January 29, 1996, and latest
amended on August 5, 2008, with the latest revision effective on the same date, is a
fundamental legal basis for foreign exchange supervision and regulation by relevant authorities
in PRC, according to which, RMB may be freely converted into other currencies for current
account items (such as foreign exchange transactions in relation to commodity, trade and
service, and dividend distribution), based on real and lawful transactions; but capital account
items (such as share capital transfer, direct investment, securities investment, derivatives or
loan) unless it is approved by the relevant foreign exchange administration department and it
has completed the pre registration with the relevant foreign exchange administration
department.
In accordance with the Circular of SAFE on Further Improving and Adjusting Foreign
Exchange Administration Policies for Direct Investment (ආɓӉҷආձ
) (hereinafter referred to as “Circular 59”) was
promulgated by SAFE on November 19, 2012, became effective on December 17, 2012, and
was further amended on May 4, 2015, approval is not required for the opening of an account
entry in foreign exchange accounts under direct investment. Circular 59 also simplifies the
capital verification and confirmation formalities for foreign invested enterprises (“FIEs”); the
foreign capital and foreign exchange registration formalities required for the foreign investors
to acquire equities from Chinese party and further improve the administration on exchange
settlement of FIEs.
The Notice of the State Administration of Foreign Exchange on Reforming the
Administration of Foreign Exchange Settlement of Capital of Foreign-invested Enterprises
() (hereinafter
referred to as “Circular 19”) was promulgated by SAFE on March 30, 2015, came into effect
on June 1, 2015 partially repealed on December 30, 2019 and partially amended by the Notice
of the State Administration of Foreign Exchange of Policies for Reforming and Regulating the
Control over Foreign Exchange Settlement under the Capital Account (׵
) promulgated by SAFE on June 9, 2016 and
superseded the Notice from the State Administration of Foreign Exchange on Reforming the
Administration Method of Settlement of Foreign Exchange Capitals of Foreign-invested
Enterprises (hereinafter referred to as “Circular 142”) from the effective date. Circular 19
specifies that foreign exchange settlement by foreign-invested enterprise is subject to
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supervision under foreign exchange settlement policies, and cancels certain foreign exchange
restrictions under Circular 142. However, Circular 19 restates that the use of capital of foreign
invested enterprises should follow the principle of truthfulness and self-use within the business
scope of a enterprise.
In accordance with the Notice from the State Administration of Foreign Exchange on
Reforming and Regulating the Policies of Administration of Foreign Exchange Settlement
for Capital Items ()
(hereinafter referred to as “Circular 16”) which was promulgated by the State Administration
of Foreign Exchange on June 9, 2016 and came into effect on the same date, an enterprise
registered in China may, at its sole discretion, convert its foreign debts in a foreign currency
to RMB. Circular 16 provides a unified standard for foreign exchange under capital items
(including but not limited to foreign currency capital and foreign debt) which may be
convertible at the sole discretion of the enterprise. Such standard is applicable to all enterprises
registered in the PRC. In addition, Circular 16 restates that, unless otherwise specified, an
enterprise shall not directly or indirectly use RMB funds obtained as a result of conversion of
foreign currency funds, for purposes outside the business scope, or for investments wealth
management other than securities investment or capital protected products of banks in China.
Moreover, except within the business scope, RMB funds obtained as a result of conversion
shall not be used as loans to non-related companies; save for investment in a real estate
enterprise, RMB funds obtained as a result of conversion shall not be used for construction or
purchase of real estate which will not be used by the enterprise.
On October 23, 2019, the State Administration of Foreign Exchange released the Notice
of the State Administration of Foreign Exchange on Further Promoting the Facilitation of
Cross-border Trade and Investment (лʷ
), which was amended on December 4, 2023, according to which, besides foreign-
invested enterprises engaged in investment business, non-investment foreign-invested
enterprises are also permitted to make domestic equity investments with their capital funds in
accordance with the laws provided that such investments do not violate the Special
Administrative Measures (Negative List) for Foreign Investment Access (ɝतй
݄(૶ఊ)) (hereinafter referred to as “Negative List”) and the target investment
projects are genuine and in compliance with laws. According to the Notice of the SAFE on
Optimizing Foreign Exchange Administration to Support the Development of Foreign-related
Business (ٝissued by the State
Administration of Foreign Exchange on April 10, 2020, 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 submitting the evidentiary materials concerning
authenticity of such capital for banks in advance; provided that their capital use is authentic
and in compliance with administrative regulations on the use of income under capital accounts.
The bank in charge shall follow the principle of prudential business development to manage
and control relevant business risks, and conduct post spot checking on the facilitation of
payment for the income under capital accounts in accordance with relevant requirements.
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DIVIDEND DISTRIBUTION
In accordance with the Company Law of the People’s Republic of China ( ʕശɛ͏΍
), which was promulgated by the Standing Committee of the National People’s
Congress on December 29, 1993, October 26, 2018, and was amended on December 29, 2023,
and the Foreign Investment Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷̮ਠҳ
) (hereinafter referred to as “Foreign Investment Law”), which was promulgated by the
National People’s Congress of the People’s Republic of China on March 15, 2019 and came
into effect on January 1, 2020, foreign-invested enterprises in the PRC may pay dividends only
out of their accumulated profit, if any, determined in accordance with PRC accounting
standards and regulations. A PRC company, including foreign-invested enterprise, is required
to set aside as general reserves at least 10% of its after-tax profit, until the cumulative amount
of such reserves reaches 50% of its registered capital unless the provisions of laws regarding
foreign investment otherwise provided, and shall not distribute any profits until any losses
from prior fiscal years have been offset. Profits retained from prior fiscal years may be
distributed together with distributable profits from the current fiscal year.
REGULATIONS RELATED TO THE “FULL CIRCULATION” OF H-SHARE
In accordance with the Guidelines for the Application by H-share Companies for “Full
Circulation” of Unlisted Shares ( H΅͡ሗ“ஷ”ˏ) which
was promulgated by the CSRC on 14 November 2019 and came into effect on the same date,
which was partly revised on August 10, 2023 according to the Decision on Revising and
Abolishing Part of Securities and Futures Policy Documents by CSRC ( ʕ਷ᗇՎ္ຖ၍ଣ
), the term “full circulation” means the
circulation of domestically unlisted shares (including domestically unlisted shares held by
domestic shareholders prior to the listing abroad, additional domestically unlisted shares issued
domestically after listing abroad and unlisted shares held by holders of foreign shares) of
H-share companies on the Hong Kong Stock Exchange. On the premise of complying with
relevant laws and regulations as well as policies governing state-owned asset management,
foreign investment and industrial supervision, the shareholders of domestically unlisted shares
may determine the number and proportion of shares under application for circulation through
negotiation at their discretion and entrust a H-share company to file an application for “full
circulation”. After the domestically unlisted shares are listed for circulation on the Hong Kong
Stock Exchange, they shall not be transferred back to the Mainland China. A shareholder of
domestically unlisted shares may reduce or increase its holding of the shares involved that are
circulating on the Hong Kong Stock Exchange according to relevant business rules. H share
companies shall submit a report on the relevant information to the CSRC within 15 days from
completion of re-registration of the shares involved in the application to CSDC.
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In accordance with the Notice on Promulgation of the Implementing Rules for “Full
Circulation” of H-shares (೯б<Hٰ“ஷ”ۆ>) which was
promulgated by CSDC and Shenzhen Stock Exchange on December 31, 2019 and came into
effect on the same date, it shall apply to the relevant businesses involved in “full circulation”
of H-shares, such as cross-border re-registration, custodian and maintenance of holding details,
entrustment of transactions and order routing, settlement, management of clearing participants,
services of nominee holders etc. Upon completion of information disclosure by a H-share listed
company approved by the CSRC to participate in “full circulation” of H-shares, such company
shall register anew its fully tradable H-shares free from pledge, freezing, restriction of transfer
and other restrictive status with the Hong Kong share registration authorities to have them
become shares that can be listed and circulated on the Hong Kong Stock Exchange. The
relevant securities shall be deposited centrally with CSDC in China. CSDC, as the nominee of
the aforesaid securities, shall handle the business such as the depository and maintenance of
holding details as well as cross-border clearing and settlement involved in the “full circulation”
of H-shares, and provide services of nominee for investors. H-share listed companies shall
obtain the authorization from investors and select a domestic securities company to participate
in the “full circulation” of H-shares. Investors submit the trading orders for the “full
circulation” of H-shares through a domestic securities company. The domestic securities
company shall select a Hong Kong securities company through which investors’ trading
instructions shall be reported to the Hong Kong Stock Exchange for trading. After transactions
are concluded, CSDC and China Securities Depository and Clearing (Hong Kong) Company
Limited shall handle cross-border clearing and settlement of relevant shares and funds. The
settlement currency of H-share “full circulation” transaction business is Hong Kong dollars.
Where an H-share listed company entrusts CSDC to distribute cash dividends, it shall file an
application with CSDC. The H-share listed company, when distributing cash dividends, may
claim the details of the shares held by relevant investors on the equity registration date for cash
dividends from CSDC. If an investor obtains “fully tradable” non-H-shares listed on the Hong
Kong Stock Exchange due to the equity distribution or conversion of H-shares under full
circulation, the investor may sell but cannot purchase such securities; if the investor obtains the
right to subscribe for shares listed on the Hong Kong Stock Exchange and such right is listed
on the Hong Kong Stock Exchange, the investor may sell but shall not exercise such right.
In accordance with the Notice on the Guidelines to the Program for “Full Circulation” of
H-shares (೯б<Hٰ“ஷ”یܸ>) which was promulgated by CSDC on
February 2, 2020 and came into effect on the same date, it specified the business preparation,
account arrangement, cross-border share transfer registration and overseas centralized custody,
etc. And China Securities Depository and Clearing (Hong Kong) Company Limited also
promulgated the Guide to the Program for Full Circulation of H-shares ( ʕ਷ᗇՎ೮াഐၑ
ʮ̡Hٰ“ஷ”) to specify the relevant escrow, custody, agent service of
China Securities Depository and Clearing (Hong Kong) Company Limited, arrangement for
settlement and delivery and other relevant matters.
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INTRODUCTION
Overview
Our history dates back to December 2005 when Mr. Tang (the chairman of the Board,
executive Director, and one of our Controlling Shareholders) established our Company and
became our largest shareholder. Prior to the establishment of our Company, Mr. Tang had
already obtained a master degree in software engineering from Shanghai Jiao Tong University
(ɪऎʹஷɽኪ) in the PRC, and accumulated years of industry research and development
experience. In May 2015, our Company was converted into a joint stock company with limited
liabilities.
Since our Company’s inception in 2005, the scenarios we have served are mainly
scenarios that require interaction. We believe that to achieve effective interaction, the three
capabilities for conducts are generally required, namely “communication”, “thinking” and
“execution” while the corresponding technologies are unified communications, artificial
intelligence and product engine. “Communication” corresponds to unified communication
technology, which is similar to human vision, hearing, and speaking abilities. This process is
to obtain information through the sensory organs, transfer the information to the brain, and then
output the information after analysis by the brain. “Thinking” corresponds to artificial
intelligence technology, which is similar to human analytical ability. “Execution” corresponds
to product engine technology, which is similar to human execution capabilities and is used to
complete interactions to achieve the final goal. In this regard, from 2005 to 2015, we mainly
engaged in the research and development of unified communication-related technologies,
having developed applications that unified multiple forms of communication and integrated
them to product engines. Starting from 2016, we embarked on the development of artificial
intelligence required in interactive scenarios. In 2020, we extensively consolidated our
products and technologies, such as unified communications, product engines and artificial
intelligence developed in the early stage, to forge our current solution offerings, and persisting
in exploring, researching and developing in key technology areas.
After nearly two decades of persistent research and development, we have become a
seasoned IT solution provider dedicated to enterprise-level conversational AI in China. We
have independent research and development capabilities for unified communications, artificial
intelligence and product engines, being the three technologies required in interactive scenarios,
based on which we have expanded a comprehensive suite of standardized products, which can
meet the needs of customers in terms of completeness, convenience, affordability and
replicability of product, which thereby was taken as our Company’s core competitiveness.
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Business Milestones
The following table illustrates the key milestones of our business and corporate
developments:
Time Milestone
2005  Our Company was established in the PRC with limited liability in
December 2005.
2007  We launched our enterprise-level interactive software products
with unified communications as the core.
 We began providing service for the hotline of a power company in
the PRC.
 We were awarded the “Software Enterprise Certificate” ( ழ΁Άุ
ࣣand was accredited as a “Software Enterprise” ( ழ΁Ά
ุ).
2011  We completed the technology upgrade of our enterprise-level
interactive software products, with the addition of low-code
business platform software.
 We successfully achieved double software certifications ( ᕐழႩ
ᗇ), i.e. having obtained the “Software Product Registration
Certificate” (ࣣin 2011 in addition to the
“Software Enterprise Certificate” (ࣣpreviously
obtained in 2007.
 We provided services to a company engaging in the provision of
in-vehicle security systems, which marked our entry into the field
of IoV .
2012  We completed the technology upgrade of our enterprise-level
interactive software products to support distributed multi-tenant
application.
 We obtained the qualification as high-technology enterprise.
2014  We provided a service platform supporting distributed customer
service application for a telecommunications company in Tianjin.
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Time Milestone
2015  The conversion of our Company into a joint stock company with
limited liability was completed, and our Company was renamed as
Shanghai V oicecomm Information Technology Co., Ltd. ( ɪऎᑊஷ
ʮ̡).
2016  We completed the technology upgrade of our unified
communications and AI-empowered platform to support mobile
terminals and natural language understanding (NLU).
2017  We were engaged to implement the intelligent town project in
Chengdu, Sichuan, to facilitate the unification and integration of
the infrastructure, administration, production and service
activities, healthcare, security and educations, etc., of more than
200 towns into one cloud-based platform.
2018  We completed the technology upgrade of our unified
communications and AI-empowered platform to support natural
language generation (NLG), realizing human-machine
interactions.
2019  We were accredited as a specialized and new enterprise ( ਖ਼ၚतอ
Άุ).
2020  We completed the technology upgrade of our unified
communications and AI-empowered platform to support automatic
speech recognition (ASR) and text to speech (TTS) technologies.
 We were awarded the “Little Giant” Enterprise in 2019 (2019ܓ
ʃ̶ɛΆุ).
 We completed our Series A Financing and raised RMB74.4 million.
2021  The School of Electronic Information and Electrical Engineering
of Shanghai Jiao Tong University and we jointly established the
Research Laboratory for AI Applications.
 We were awarded the “Golden V oice” – China Best All Media
Intelligent Customer Service Solution Award, 2021 (ᆤ–2021
ᆤ).
 We become a member of the Information Technology Application
Innovation Working Committee (ึ).
 We completed our Series B Financing and raised RMB140.4
million.
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Time Milestone
2022  We completed the technology upgrade of our unified
communications and AI-empowered platform to support video-
based interaction and emotion recognition.
 We were awarded, among others, the Second prize, ISCSLP 2022
Conversational Short-Phrase Speaker Diarization Challenge
(ISCSLP2022ࠏ.)
 We become a member of the National SME Public Service
Demonstration Platform (ਕͪᇍ̨̻).
 We completed our Series B+ Financing and raised RMB104.8
million.
2023  Academician He Jifeng ( Оጐᔮ), an academician of the Chinese
Academy of Sciences and an renowned expert in the field of AI,
became our chief scientist.
 We completed our Series C Financing and raised approximately
RMB180.0 million.
2024  We were awarded 2023 Outstanding Products in the Information
Technology Application Innovation Industry (2023௴
ۜfor our Video Call Centre Business Management System
VC-COMS ( ൖ᎖խ̣ʕːุਕ၍ଣӻ୕VC-COMS)
 We were recognized as one of the 2024 Forbes China Top 50
Artificial Intelligence Technology Companies (2024 ၅̺౶ʕ਷ɛ
ҦΆุTOP 50).
CORPORATE DEVELOPMENT
Establishment of our Company, initial capital increase and initial equity transfers
Our Company was established in the PRC on December 5, 2005 with an initial registered
capital of RMB1,000,000, which was held by Mr. Tang as to 28%, and four other shareholders
(the “ Initial Shareholders ”) as to 27%, 15%, 15% and 15%, respectively. To the best
knowledge and information of our Directors, Mr. Tang and the Initial Shareholders established
our Company using their own funds. Since its incorporation, we have principally engaged in
offering unified communications and AI-empowered solutions.
Pursuant to the shareholders’ resolutions dated December 10, 2010, the registered capital
of our Company was increased to RMB5,000,000. Such additional registered capital was
contributed by Mr. Tang and the Initial Shareholders in proportion to their respective equity
interests in our Company at the time. As a result, the shareholding percentage of Mr. Tang and
the Initial Shareholders remained unchanged upon completion of the said capital increase.
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To the best knowledge and belief of our Directors, the Initial Shareholders subsequently
wished to divert their resources for investment in other areas in the industry. On the other hand,
Mr. Tang saw the potential in the industry, and decided to invite Mr. Sun and Mr. Shi Yerong
(ุͩᏌ)( “ Mr. Shi ”), who were business partners of our Group to develop our business
together, and provide them with an opportunity to acquire equity interests in our Company as
incentive for their commitment and continuing contribution. Against this backdrop, pursuant to
a series of equity transfer agreements dated June 19, 2013, the Initial Shareholders transferred
(i) a total of 42% of equity interests of our Company to Mr. Tang at the total consideration of
RMB2,100,000 representing the corresponding registered capital of RMB2,100,000; (ii) 15%
of equity interests of our Company to Mr. Sun at the total consideration of RMB750,000
representing the corresponding registered capital of RMB750,000; and (iii) 15% of equity
interests of our Company to Mr. Shi at the total consideration of RMB750,000 representing the
corresponding registered capital of RMB750,000. The consideration was arrived after arm’s
length negotiation between the parties with reference to the registered capital of our Company
at the time. Upon completion of the above equity transfers on June 28, 2013, (i) our Company
was owned as to 70% by Mr. Tang, 15% by Mr. Sun, and 15% by Mr. Shi; and (ii) the Initial
Shareholders ceased to have any interests in our Group since then. The work and contributions
of Mr. Sun and Mr. Tang had been instrumental to the development of the Group to become a
provider of unified communications and AI-empowered solutions in China. Mr. Tang and Mr.
Sun are currently our executive Directors. For details of their biographies, see “Directors,
Supervisors and Senior Management – Executive Directors” in this prospectus.
Capital Increase in 2015
Pursuant to the shareholders’ resolutions dated January 10, 2015, the registered capital of
our Company was increased to RMB10,000,000. Such additional registered capital was
contributed by Mr. Tang, Mr. Sun and Mr. Shi in proportion to their respective equity interests
in our Company at the time. As a result, their shareholding percentage in our Company
remained unchanged upon completion of the said capital increase on January 27, 2015.
Joint Stock Reform and quotation on the N Board
In contemplation of the quotation on the N Board managed by the Shanghai Equity
Exchange (ʮ̡), our Company convened an inaugural
meeting on April 26, 2015, pursuant to which the then existing Shareholders agreed to convert
our Company into a joint stock limited liability company with a registered capital of
RMB10,000,000. In furtherance of the above, out of the total net assets of our Company as of
February 28, 2015 in the amount of RMB11,558,441.88, (i) RMB10,000,000 was converted
into 10,000,000 Shares of RMB1.0 par value each, and issued to the then Shareholders in
proportion to their capital contribution to our Company; and (ii) the remaining
RMB1,558,441.88 was converted into capital reserve. On May 7, 2015, the conversion of our
Company into a joint stock company with limited liability was completed, and our Company
was renamed as Shanghai V oicecomm Information Technology Co., Ltd. (ٰ
ʮ̡).
On December 18, 2015, 10,000,000 Shares, being the then entire share capital of our
Company, became quoted on the N Board under the stock code 300005.
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Increase in share capital in 2016
Pursuant to an investment agreement dated December 28, 2015 entered into between our
Company and Shanghai Xiding Equity Investment Fund Management Co., Ltd. (ᛆ
ʮ̡)( “ Shanghai Xiding ”), the registered capital of our Company was
increased to RMB10,750,000, with the additional registered capital being subscribed by
Shanghai Xiding as nominee shareholder on behalf of certain investors at the total subscription
price of RMB6.0 million (for details, see “Historical nominee arrangements and their
termination” in this section below). The subscription price of the capital increase was
determined after arm’s length negotiations between the parties with reference to, among others,
the status of business development of our Company, the market environment, the estimated
valuation of our Company based on the average price to earnings ratio of the industry and the
operation of comparable companies in the industry. On April 1, 2016 and upon completion of
the subscription of Shares by Shanghai Xiding, the shareholding structure of our Company was
as follows:
Shareholder Number of Shares Shareholding
Mr. Tang 7,000,000 65.12%
Mr. Shi Yerong ( ุͩᏌ) 1,500,000 13.95%
Mr. Sun 1,500,000 13.95%
Shanghai Xiding 750,000 6.98%
Total 10,750,000 100.00%
Increase in share capital in 2019
Pursuant to the shareholders’ resolutions dated April 19, 2019, the total share capital of
our Company was increased to 17,200,000 Shares by way of conversion of capital reserve of
our Company on the basis of six new Shares for every ten existing Shares. Upon completion
of the capital increase (after also taking into account the share transfer on the platform of the
N Board by the then Shareholders prior to the capital increase), the shareholding structure of
our Company was as follows:
Shareholder Number of Shares Shareholding
Mr. Tang 11,200,000 65.12%
Mr. Sun 2,400,000 13.95%
Mr. Shi 2,400,000 13.95%
Shanghai Xiding 1,120,000 6.51%
Mr. Qin Huai’er ( ൕᕿɚ)( “ Mr.
Qin”) 80,000 0.47%
Total 17,200,000 100.00%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Series A Financing
Pursuant to a number of capital increase agreements entered into, among others, between
our Company and each of the investors in the Series A Financing (the “ Series A Investors ”),
the Series A Investors agreed to subscribe for an aggregate of 4,960,000 new Shares
(corresponding to additional registered share capital of RMB4,960,000) for the total
subscription price of RMB74,400,000. Details of the subscription of the new Shares by the
Series A Investors (the “ Series A Financing ”) were as follows:
Name of Series A Investor
Date of capital
increase agreement
Number of
Shares
subscribed for
Subscription
price
Corresponding
approximate equity
interest in our Company
(upon completion of the
Series A Financing)
Zibo Yingke Jiyun Venture
Capital Partnership (Limited
Partnership) (Λ༶௴
ุҳ༟ΥྫΆุ(Υྫ))
(“Yingke Jiyun ”)
June 18, 2020
(as amended and
supplemented by a
supplemental
agreement dated
June 22, 2023)
2,400,000 RMB36,000,000 10.83%
Jiaxing Shangyu Investment
Partnership (Limited
Partnership) (༃ҳ༟Υ
ྫΆุ(Υྫ)) (“ Jiaxing
Shangyu ”)
April 24, 2020
(as amended and
supplemented by a
supplemental
agreement dated
June 22, 2023)
1,300,000 RMB19,500,000 5.87%
Shanghai Xinzhuang Industrial
Park Economic and
Technology Development Co.,
Ltd. ( ɪऎ̹୸୿ʈุਜ຾᏶Ҧ
ʮ̡)( “ Xinzhuang
Industrial Park ”)
September 27, 2020
(as amended and
supplemented by a
supplemental
agreement dated
June 21, 2023)
660,000 RMB9,900,000 2.98%
Gongqingcheng Softbank Huaxin
Investment Center (Limited
Partnership) (ழვശ㒥
ҳ༟ʕː(Υྫ))
(“Gongqingcheng Softbank ”)
June 10, 2019
(as amended and
supplemented by a
supplemental
agreement dated
May 5, 2023)
600,000 RMB9,000,000 2.71%
Total 4,960,000 RMB74,400,000 22.40%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 183 ---
The consideration of the Series A Financing was determined after arm’s length
negotiations between our Company and the Series A Investors with reference to the then status
of the business development of our Company, and was supported by the appraised value of the
total shareholders’ equity in our Company by an independent asset appraisal agency by using
the income approach with December 31, 2019 as the reference date. For details, see “Pre-IPO
Investments” in this section below.
Upon completion of the Series A Financing in September 2020, the shareholding structure
of our Company (after also taking into account a number of share transfers conducted on the
platform of the N Board by the Shareholders before then) was as follows:
Shareholder Number of Shares held
Shareholding
(Note 4)
Shanghai Fengjing Information
Consultation Co., Ltd.
(ʮ̡)
(Note 1) 5,516,000 24.89%
Mr. Tang (Note 1) 3,500,000 15.79%
Shanghai Chenqi Information
Consultation Co., Ltd.
(ʮ̡)
(“Chenqi Information ”)
(Note 2) 2,412,000 10.88%
Yingke Jiyun 2,400,000 10.83%
Jiaxing Shangyu 1,800,000 8.12%
Mr. Sun (Note 3) 1,800,000 8.12%
Mr. Qin 1,220,000 5.51%
Xinzhuang Industrial Park 660,000 2.98%
Gongqingcheng Softbank 600,000 2.71%
Jiageng Culture (Note 3) 600,000 2.71%
Mr. Zhang Zhuo ( ੵՙ) 500,000 2.26%
Shanghai Xiding 452,000 2.04%
Mr. Bian Yulong ( ʼ͗Ꮂ) 200,000 0.90%
Mr. Luo Jun (ࠏ200,000 0.90%
Mr. Yang Leizhe ( เᑜ䂮) 200,000 0.90%
Mr. Ding Yi ( ɕᆇ) 100,000 0.45%
Total 22,160,000 100.00%
Notes :
1. Shanghai Fengjing Information Consultation Co., Ltd. (ʮ̡) (the former name
of V oicecomm Rongzhi) is a company established in the PRC which was owned as to 99.00% by Mr.
Tang and 1.00% by Ms. Xu (the spouse of Mr. Tang). As a result, Mr. Tang was interested in an
aggregate of approximately 40.70% of the issued shares of our Company at the time.
2. Chenqi Information is a company established in the PRC which was wholly-owned by Mr. Shi.
3. Jiageng Culture is a company established in the PRC which was wholly-owned by Mr. Sun. As a result,
Mr. Sun was interested in an aggregate of approximately 10.80% of the issued shares of our Company
at the time.
4. The aggregate of the percentage figures in the above table may not add up to 100% due to rounding of
the percentage figures to two decimal places.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 184 ---
Series B Financing
Pursuant to a number of capital increase agreements entered into, among others, between
our Company and each of the investors in the Series B Financing (the “ Series B Investors ”),
the Series B Investors agreed to subscribe for an aggregate of 3,510,000 new Shares
(corresponding to additional registered share capital of RMB3,510,000) for the total
subscription price of RMB140,400,000. Details of the subscription of the new Shares by the
Series B Investors (the “ Series B Financing ”) were as follows:
Name of Series B Investor
Date of capital
increase agreement
Number of
Shares
subscribed for
Subscription
price
Corresponding
approximate equity
interest in our Company
(upon completion of the
Series B Financing)
Qingdao Yingke Value Venture
Capital Partnership (L.P.) (ڡ
௴ุҳ༟ΥྫΆุ
(Υྫ)) (“ Qingdao
Yingke ”)
July 1, 2021 (as
amended and
supplemented by two
supplemental
agreements dated July
1, 2021 and June 21,
2023)
1,250,000 RMB50,000,000 4.87%
Shanghai Cuiwen Network
Technology Co., Ltd. ( ɪऎയ
ʮ̡)
(“Cuiwen Network ”)
June 4, 2021 (as
amended and
supplemented by two
supplemental
agreements dated
June 4, 2021 and June
13, 2023)
510,000 RMB20,400,000 1.99%
Jiaxing Laida Investment
Partnership (Limited
Partnership) ( ྗጳഺ༺ҳ༟Υ
ྫΆุ(Υྫ)) (“ Jiaxing
Laida ”)
May 17, 2021 (as
amended and
supplemented by
two supplemental
agreements dated
May 17, 2021 and
May 30, 2023)
500,000 RMB20,000,000 1.95%
Zibo Bokai Venture Capital Co.,
Ltd. (ʮ
̡)( “ Zibo Bokai ”)
June 10, 2021 (as
amended and
supplemented by two
supplemental
agreements dated
June 10, 2021 and
June 12, 2023)
500,000 RMB20,000,000 1.95%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 185 ---
Name of Series B Investor
Date of capital
increase agreement
Number of
Shares
subscribed for
Subscription
price
Corresponding
approximate equity
interest in our Company
(upon completion of the
Series B Financing)
Qingdao Huazi Shengtong
Equity Investment Fund
Partnership (Limited
Partnership) (ٰ
ΥྫΆุ(Υ
ྫ)) (“ Huazi Shengtong ”)
July 5, 2021 (as
amended and
supplemented by two
supplemental
agreements dated
July 5, 2021 and
June 19, 2023)
500,000 RMB20,000,000 1.95%
Beijing Jingjin Investment
Management Consulting Co.,
Ltd. ( ̏ԯཨᎀҳ༟၍ଣፔ༔Ϟ
ʮ̡)( “ Jingjin
Investment ”)
June 10, 2021 (as
amended and
supplemented by two
supplemental
agreements dated
June 10, 2021 and
May 19, 2023)
250,000 RMB10,000,000 0.97%
Total 3,510,000 RMB140,400,000 13.68%
The consideration of the Series B Financing was determined after arm’s length
negotiations between our Company and the Series B Investors with reference to the then status
of the business development of our Company, and was supported by the appraised value of the
total shareholders’ equity in our Company by an independent asset appraisal agency by using
the income approach with February 28, 2021 as the reference date. For details, see “Pre-IPO
Investments” in this section below.
Upon completion of the Series B Financing in July 2021, the shareholding structure of our
Company (after also taking into account a number of share transfers conducted on the platform
of the N Board by the Shareholders since the completion of the Series A Financing and up until
then) was as follows:
Shareholder Number of Shares held
Shareholding
(Note 8)
Shanghai Fengjing Information
Consultation Co., Ltd. ( ɪऎ໶
ʮ̡)
(Note s1&7 ) 5,516,000 21.49%
Mr. Tang (Note s1&7 ) 3,500,000 13.63%
Yingke Jiyun (Note 2) 2,400,000 9.35%
Chenqi Information (Note 3) 2,389,000 9.31%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 186 ---
Shareholder Number of Shares held
Shareholding
(Note 8)
Jiaxing Shangyu (Note 4) 1,800,000 7.01%
Mr. Sun (Note s5&7 ) 1,800,000 7.01%
Qingdao Yingke (Note 2) 1,250,000 4.87%
Mr. Qin 1,220,000 4.75%
Xinzhuang Industrial Park 660,000 2.57%
Gongqingcheng Softbank 600,000 2.34%
Jiageng Culture (Note s5&7 ) 600,000 2.34%
Cuiwen Network 510,000 1.99%
Huazi Shengtong 500,000 1.95%
Jiaxing Laida (Note 4) 500,000 1.95%
Mr. Zhang Zhuo ( ੵՙ) 500,000 1.95%
Zibo Bokai 500,000 1.95%
Mr. Yang Leizhe ( เᑜ䂮) 300,000 1.17%
Jingjin Investment 250,000 0.97%
Jiangfan Technology (Note s6&7 ) 240,000 0.93%
Mr. Luo Jun (ࠏ200,000 0.78%
Shanghai Xiding 112,000 0.44%
Mr. Bian Yulong ( ʼ͗Ꮂ) 100,000 0.39%
Mr. Ding Yi ( ɕᆇ) 100,000 0.39%
Ms. Du Yingdong (؇ߵ100,000 0.39%
Jiangsu Xinzhi Equity Investment
Management Co., Ltd. ( Ϫᘽ㒥
ʮ̡)
(“Jiangsu Xinzhi ”) 20,000 0.08%
Mr. Shi (Note 3) 3,000 0.01%
Total 25,670,000 100.00%
Notes:
1. Shanghai Fengjing Information Consultation Co., Ltd. (ʮ̡) (the former name
of V oicecomm Rongzhi) is a company established in the PRC which was owned as to 99.00% by Mr.
Tang and 1.00% by Ms. Xu (the spouse of Mr. Tang). As a result, Mr. Tang was interested in an
aggregate of approximately 35.12% of the issued shares of our Company at the time.
2. Yingke Jiyun and Qingdao Yingke are both managed by Yingke Innovation Asset Management Co., Ltd.
(ʮ̡) as their general partner. Yingke Jiyun and Qingdao Yingke together were
interested in an aggregate of approximately 14.22% of the issued shares of our Company at the time.
3. Chenqi Information is a company established in the PRC which was wholly-owned by Mr. Shi. As a
result, Mr. Shi was interested in an aggregate of approximately 9.32% of the issued shares of our
Company at the time.
4. Jiaxing Shangyu and Jiaxing Laida are both managed by Shanghai Qifeng Investment Management Co.,
Ltd. (ʮ̡) as their respective general partner and fund manager. Jiaxing
Shangyu and Jiaxing Laida together were interested in an aggregate of approximately 8.96% of the
issued shares of our Company at the time.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 187 ---
5. Jiageng Culture is a company established in the PRC which was wholly-owned by Mr. Sun. As a result,
Mr. Sun was interested in an aggregate of approximately 9.35% of the issued shares of our Company
at the time.
6. Jiangfan Technology is a company established in the PRC which was wholly-owned by Jiangcheng Asset
Management, and which was in turn held as to 60.0% by Mr. Yang, our non-executive Director, and
40.0% by Mr. Jiang Haisheng (ऎ͛). To the best knowledge and information of our Directors, Mr.
Jiang Haisheng (ऎ͛) is a business associate of Mr. Yang, and engaged in asset management through
Shanghai Jiangcheng Asset Management Co., Ltd. (ʮ̡) (the holding company
of Jiangfan Technology). Save for the aforesaid and that Jiangfan Technology is a limited partner with
approximately 29.97% of partnership interests in Jiaxing Chengshun Phase II (being one of the Pre-IPO
Investors. For details, see “Series C Financing” in this section below), Mr. Jiang Haisheng (ऎ͛)i s
independent from the Group, its Directors and senior management and Shareholders and their respective
close associates. For the background leading to Jiangfan Technology becoming a Shareholder and
entering into the Concert Party Agreement, see “Concert Party Arrangement” in this section below.
7. Pursuant to the Concert Party Agreement dated March 20, 2021, Mr. Tang, Mr. Sun and Jiangfan
Technology agreed that they shall act in concert with respect to, inter alia, the right to convene board
meetings and general meetings, right to propose resolutions, nomination right, voting rights, nomination
of senior management, and other matters which are subject to approval in general meetings or board
meetings of the Company, for the period since the date of the Concert Party Agreement and up until they
cease to hold any shares of the Company or upon the termination of the Concert Party Agreement. For
details, see “Concert Party Arrangement” in this section below.
8. The aggregate of the percentage figures in the above table may not add up to 100% due to rounding of
the percentage figures to two decimal places.
Series B+ Financing
Pursuant to a number of capital increase agreements entered into, among others, between
our Company and each of the investors of the Series B+ Financing (the “ Series B+ Investors ”),
the Series B+ Investors agreed to subscribe for an aggregate of 2,620,000 new Shares
(corresponding to additional registered share capital of RMB2,620,000) for the total
subscription price of RMB104,800,000. Details of the subscription of the new Shares by the
following Series B+ Investors (the “ Series B+ Financing ”) as follows:
Name of Series B+ Investor
Date of capital
increase agreement
Number of
Shares
subscribed for
Subscription
price
Corresponding
approximate equity
interest in our Company
(upon completion of the
Series B+ Financing)
Suzhou Bodao Dinghua Equity
Investment Partnership
(Limited Partnership) ( ᘽψ
ᛆҳ༟ΥྫΆุ
(Υྫ)) (“ Bodao
Dinghua ”)
August 30, 2022 (as
amended and
supplemented by
two supplemental
agreements dated
August 30, 2022 and
May 5, 2023)
750,000 RMB30,000,000 2.65%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 188 ---
Name of Series B+ Investor
Date of capital
increase agreement
Number of
Shares
subscribed for
Subscription
price
Corresponding
approximate equity
interest in our Company
(upon completion of the
Series B+ Financing)
Gongqingcheng Huanping
Equity Investment
Partnership (Limited
Partnership) (ٰ
ᛆҳ༟ΥྫΆุ(Υྫ))
(“Gongqingcheng
Huanping ”)
August 15, 2022 (as
amended and
supplemented by
two supplemental
agreements dated
August 15, 2022 and
May 5, 2023)
745,000 RMB29,800,000 2.63%
Chengdu Technology
Innovation Investment
Group Co., Ltd. (Ҧ
ʮ̡)
(“Chengdu Technology
Innovation Investment ”)
March 31, 2022 (as
amended and
supplemented by
two supplemental
agreements dated
March 31, 2022 and
June 22, 2023)
603,000 RMB24,120,000 2.13%
Shanghai Donghao Lansheng
Human Resources Industry
Equity Investment Fund
Partnership (Limited
Partnership) (खᚆ͛
ږ
ΥྫΆุ(Υྫ))
(“Donghao Lansheng ”)
August 16, 2022 (as
amended and
supplemented by
two supplemental
agreements dated
August 16, 2022 and
May 9, 2023)
500,000 RMB20,000,000 1.77%
Chengdu Tongchuang Zhixing
Enterprise Management
Consulting Partnership
(Limited Partnership) ( ϓே
БΆุ၍ଣፔ༔Υྫ
Άุ(Υྫ))
(“Tongchuang Zhixing ”)
March 31, 2022 (as
amended and
supplemented by
two supplemental
agreements dated
March 31, 2022 and
June 22, 2023)
22,000 RMB880,000 0.08%
Total 2,620,000 RMB104,800,000 9.26%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 189 ---
The consideration of the Series B+ Financing was determined after arm’s length
negotiations between our Company and the Series B+ Investors following the same pricing
basis as the Series B Financing. For details, see “Pre-IPO Investments” in this section below.
Upon completion of the Series B+ Financing in October 2022, the shareholding structure
of our Company (after also taking into account a number of share transfers conducted on the
platform of the N Board by the Shareholders since the completion of the Series B Financing
and up until then) was as follows:
Shareholder Number of Shares held
Shareholding
(Note 11)
V oicecomm Rongzhi (Note s1&7 ) 5,375,000 19.00%
Mr. Tang (Note s1&7 ) 3,498,000 12.36%
Yingke Jiyun (Note 2) 2,400,000 8.48%
Chenqi Information (Note 3) 2,365,000 8.36%
Jiaxing Shangyu (Note 4) 1,800,000 6.36%
Mr. Sun (Note s5&7 ) 1,800,000 6.36%
Qingdao Yingke (Note 2) 1,250,000 4.42%
Mr. Qin (Note 10) 1,000,000 3.53%
Bodao Dinghua 750,000 2.65%
Gongqingcheng Huanping 745,000 2.63%
Xinzhuang Industrial Park 660,000 2.33%
Chengdu Technology Innovation
Investment 603,000 2.13%
Gongqingcheng Softbank 600,000 2.12%
Jiageng Culture (Note s5&7 ) 550,000 1.94%
Cuiwen Network 510,000 1.80%
Donghao Lansheng 500,000 1.77%
Jiaxing Laida (Note 4) 500,000 1.77%
Zibo Bokai 500,000 1.77%
Huazi Shengtong 500,000 1.77%
Mr. Zhang Zhuo ( ੵՙ) 500,000 1.77%
Mr. Yang Leizhe ( เᑜ䂮) 300,000 1.06%
Jingjin Investment 250,000 0.88%
Jiangfan Technology (Note s6&7 ) 240,000 0.85%
Mr. Luo Jun (ࠏ200,000 0.71%
Mr. Lu Liguang ( ጅᓿΈ) 125,000 0.44%
Ms. Pan Peihong (ߎ125,000 0.44%
Ms. Du Yingdong (؇ߵ100,000 0.35%
Mr. Bian Yulong ( ʼ͗Ꮂ) 100,000 0.35%
Shanghai Jiayuan Intelligent
Technology Co., Ltd. ( ɪऎྗӑ
ʮ̡)( “ Jiayuan
Intelligent ”) (Note 10) 100,000 0.35%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 190 ---
Shareholder Number of Shares held
Shareholding
(Note 11)
Shanghai Juntuo Intelligent
Technology Co., Ltd. (ן
ʮ̡)( “ Shanghai
Juntuo ”) (Note s8&1 0 ) 100,000 0.35%
Mr. Yan Zhiqiang ( ᘌқ੶) 80,000 0.28%
Shandong Xizhan Private Equity
Fund Management Co., Ltd. ( ʆ
ʮ̡)
(“Shandong Xizhan ”) (Note 9) 50,000 0.18%
Mr. Ding Yi ( ɕᆇ) 50,000 0.18%
Tongchuang Zhixing 22,000 0.08%
Jiangsu Xinzhi 20,000 0.07%
Mr. Feng Jian ( ඹ਄)
(Note s8&1 0 ) 20,000 0.07%
Mr. Shi (Note 3) 2,000 0.01%
Total 28,290,000 100.00%
Notes:
1. V oicecomm Rongzhi (formerly known as Shanghai Fengjing Information Consultation Co., Ltd. ( ɪऎ
ʮ̡)) is a company established in the PRC which was owned as to 99.00% by Mr.
Tang and 1.00% by Ms. Xu (the spouse of Mr. Tang). As a result, Mr. Tang was interested in an
aggregate of approximately 31.36% of the issued shares of our Company at the time.
2. Yingke Jiyun and Qingdao Yingke are both managed by Yingke Innovation Asset Management Co., Ltd.
(ʮ̡) as their general partner. Yingke Jiyun and Qingdao Yingke together were
interested in an aggregate of approximately 12.90% of the issued shares of our Company at the time.
3. Chenqi Information is a company established in the PRC which was wholly-owned by Mr. Shi. As a
result, Mr. Shi was interested in an aggregate of approximately 8.37% of the issued shares of our
Company at the time.
4. Jiaxing Shangyu and Jiaxing Laida are both managed by Shanghai Qifeng Investment Management Co.,
Ltd. (ʮ̡) as their respective general partner and fund manager. Jiaxing
Shangyu and Jiaxing Laida together were interested in an aggregate of approximately 8.13% of the
issued shares of our Company at the time.
5. Jiageng Culture is a company established in the PRC which was wholly-owned by Mr. Sun. As a result,
Mr. Sun was interested in an aggregate of approximately 8.30% of the issued shares of our Company
at the time.
6. Jiangfan Technology is a company established in the PRC which was wholly-owned by Jiangcheng Asset
Management, and which was in turn held as to 60.0% by Mr. Yang, our non-executive Director, and
40.0% by Mr. Jiang Haisheng (ऎ͛).
7. Pursuant to the Concert Party Agreement dated March 20, 2021, Mr. Tang, Mr. Sun and Jiangfan
Technology agreed that they shall act in concert with respect to, inter alia, the right to convene board
meetings and general meetings, right to propose resolutions, nomination right, voting rights, nomination
of senior management, and other matters which are subject to approval in general meetings or board
meetings of the Company, for the period since the date of the Concert Party Agreement and up until they
cease to hold any shares of the Company or upon the termination of the Concert Party Agreement. For
details, see “Concert Party Arrangement” in this section below.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 191 ---
8. Shanghai Juntuo is wholly owned by Mr. Feng Jian. As a result, Mr. Feng Jian was interested in an
aggregate of approximately 0.42% of the issued shares of our Company at the time.
9. Shandong Xizhan is currently known as Shanghai Hengxi Private Equity Fund Management Co., Ltd.
(ʮ̡).
10. In September 2022, Mr. Qin transferred through the platform of the N Board 100,000 Shares, 100,000
Shares and 20,000 Shares to Jiayuan Intelligent, Shanghai Juntuo and Mr. Feng Jian ( ඹ਄), respectively.
The consideration of the above equity transfers were each conducted at the basis of RMB32.0 per Share,
which was lower than the consideration of the Series B+ Financing and the other equity transfers
between other Shareholders conducted during the same period (i.e. RMB40.0 per Share). To the best
knowledge and information of our Directors, the consideration of the equity transfers between Mr. Qin
and each of Jiayuan Intelligent, Shanghai Juntuo and Mr. Feng Jian ( ඹ਄) were determined after arm’s
length negotiation and taking into account the relatively urgent capital needs of Mr. Qin, which
attributed to the relatively lower price per Share for the relevant equity transfers.
11. The aggregate of the percentage figures in the above table may not add up to 100% due to rounding of
the percentage figures to two decimal places.
Withdrawal from quotation on the N Board
On December 18, 2022, the shareholders’ resolution regarding the voluntary withdrawal
of quotation of our Company from the N Board (the “ Withdrawal from Quotation on the
N Board ”) was passed at a shareholders’ general meeting of our Company at the time.
On December 23, 2022, we received approval from the Shanghai Equity Exchange for the
Withdrawal from Quotation on the N Board with effect after December 23, 2022.
As at the date immediately prior to the Withdrawal from Quotation on the N Board, the
total share capital of our Company was 28,290,000 shares.
Concurrently, upon the Withdrawal from Quotation on the N Board, our Company was
transferred to the Q Board after discussion with the Shanghai Equity Exchange as a transitional
arrangement unrelated to the financial performance of our Group. As confirmed by our
Directors, the Withdrawal from Quotation on the N Board and our transfer to the Q Board was
not arising from our non-compliance with any financial indicators imposed on companies
continuously quoted on the N Board. The Q Board offers no online trading platform or trading
function. On August 31, 2023, a resolution was passed by the Shareholders to apply for the
withdrawal of quotation from the Q Board. Our application for withdrawal from quotation on
the Q Board was approved by the Shanghai Equity Exchange on 24 February 2024, and the
withdrawal was completed on 28 February 2024 (the “ Withdrawal from Quotation on the Q
Board ”).
Reasons of the Withdrawal from Quotation on the N Board and the Listing on the Stock
Exchange
The Withdrawal from Quotation on the N Board was a commercial and strategic decision
made by our then Directors, with a view to achieving our overall strategic objective to develop
an international financing platform and maximize our shareholders’ value.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Our Directors believe that the Withdrawal from Quotation on the N Board and the Listing
on the Stock Exchange will be in the interests of our Group and the Shareholders as a whole
for the following reasons:
(i) Our Company mainly adopted negotiated transfer trading mechanism during its
quotation on the N Board, which limited investor discovery and order execution. The
nature of the N Board and its relatively low trading volume (in contrast to the Stock
Exchange which has a broader investor base and more active participation of
investors in general) could make it relatively more difficult to identify and establish
the fair value of our Group to reflect our competitive strengths which differentiate
us from our competitors;
(ii) in contrast to the N Board, the Stock Exchange, as a leading player of the
international financial markets, could offer us a direct access to the international
capital markets, enhance our fund-raising capabilities and channels and broaden our
Shareholders base. Accordingly, the Listing would provide us a viable source of
capital to support our business growth;
(iii) the liquidity of shares listed on the Stock Exchange is generally higher than that of
N Board and would provide better chance of realising the interest in our Group. The
Listing would also enable our Company to, if necessary after the Listing, devise
more appealing share incentive plans, which correlates directly to the performance
in our Group’s business, which in turn would help us to attract and motivate the
talents needed to support our rapid growth and enhance our operating efficiency on
an on-going basis; and
(iv) the Listing will further raise our business profile and industry presence, further
enhance our bargaining power in our business dealings with our customers, enhance
our ability to attract higher profile customers, business partners and strategic
investors as well as to recruit, motivate and retain key management personnel for
our Group’s business.
Compliance during quotation on the N Board and the Q Board
Our Directors confirm that, to the best of their knowledge and belief, during the
respective period which our Shares were quoted on the N Board and the Q Board:
(a) our Company had been in compliance with all applicable PRC securities laws and
regulations as well as applicable rules and regulations with respect to the N Board
and the Q Board in all material respects;
(b) our Company had not been subject to any material disciplinary action by the relevant
regulators; and
(c) there were no other matters in relation to our prior quotation on the N Board and the
Q Board, the Withdrawal from Quotation on the N Board and the Withdrawal from
Quotation on the Q Board that should be brought to the attention of potential
investors of our Company.
Based on the due diligence work performed by the Sole Sponsor, nothing has come to its
attention that would cause them to disagree with the Directors’ view above.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Series C Financing
Pursuant to a number of capital increase agreements entered into, among others, between
our Company and each of the investors of the Series C Financing (the “ Series C Investors ”),
the Series C Investors agreed to subscribe for an aggregate of 2,769,230 new Shares
(corresponding to additional registered share capital of RMB2,769,230) for the total
subscription price of RMB179,999,940. Details of the subscription of the new Shares by the
following Series C Investors (the “ Series C Financing ”) was as follows:
Name of Series C Investor
Date of capital
increase agreement
Number of
Shares
subscribed for
Subscription
price
Corresponding
approximate equity
interest in our Company
(upon completion of the
Series C Financing)
Jiaxing Chengshun Phase II
Equity Investment
Partnership (Limited
Partnership) ྗጳ༐න൩ಂ
ᛆҳ༟ΥྫΆุ(Υ
ྫ)( “ Jiaxing Chengshun
Phase II ”)
May 25, 2023 (as
amended and
supplemented by a
supplemental
agreement dated
May 25, 2023)
1,538,462 RMB100,000,000 4.95%
Zhejiang Jiuli Investment
Management Co., Ltd. ( एϪ
ʮ̡)
(“Zhejiang Jiuli
Investment ”)
May 31, 2023 (as
amended and
supplemented by a
supplemental
agreement dated
May 31, 2023)
461,538 RMB29,999,970 1.49%
Neijiang High-tech Investment
Service Co., Ltd. ( ʫϪ৷อ
ப΂ʮ̡)
(“Neijiang High-tech
Investment ”)
June 15, 2023 (as
amended and
supplemented by a
supplemental
agreements dated
June 15, 2023)
461,538 RMB29,999,970 1.49%
Xi’an Jinxuntong Software
Technology Co., Ltd. ( Гτ
ʮ̡)
(“Jinxuntong Software
Technology ”)
November 28, 2022
(as amended and
supplemented by
two supplemental
agreement dated
November 28, 2022
and June 2, 2023)
277,692 RMB18,050,000 0.89%
Zhang Weihua ( ੵਃശ) June 15, 2023 20,000 RMB1,300,000 0.06%
Chen Xuanjun (ё) June 15, 2023 10,000 RMB650,000 0.03%
Total 2,769,230 RMB179,999,940 8.92%
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The consideration of the Series C Financing was determined after arm’s length
negotiations between our Company and the Series C Investors with reference to the then status
of the business development of our Company, and was supported by the appraised value of the
total shareholders’ equity in our Company by an independent asset appraisal agency by using
the income approach with November 30, 2022 as the reference date. For details, see “Pre-IPO
Investments” in this section below.
Concurrent equity transfers
After the Withdrawal from Quotation on the N Board and concurrently with the
abovementioned Series C Financing, there were several investments by certain Pre-IPO
Investors by way of equity transfers (“ 2023 Investments by Equity Transfers ”) and equity
transfers between our Shareholders as follows:
Selling
Shareholder Purchaser
Date of share
transfer agreement
Number
of Shares
transferred Consideration
Corresponding
approximate equity
interest in our Company
(upon completion of the
Series C Financing)
2023 Investments by Equity Transfers
V oicecomm
Rongzhi
Chongqing Yuanzhi
Xingjian Information
Technology
Partnership (Limited
Partnership) (ᅅჃ
ҦஔΥྫ
Άุ(Υྫ))
(“Yuanzhi Xingjian”)
February 3, 2023 (as
amended and
supplemented by
two supplemental
agreements dated
February 3, 2023
and June 15, 2023)
141,442 RMB9,193,700 0.46%
V oicecomm
Rongzhi
Ms. Song Qimin ( ҂ೡ
ઽ)
May 20, 2023 50,000 RMB3,250,000 0.16%
V oicecomm
Rongzhi
Shanghai Zhuyi
Enterprise
Management
Partnership (Limited
Partnership) (ؗ
ῸΆุ၍ଣΥྫΆุ
(Υྫ)) (“Zhuyi
Enterprise
Management”)
May 22, 2023 50,000 RMB3,250,000 0.16%
Chenqi
Information
Ms. Pan Qi ( ᆙ೘) March 1, 2023 30,000 RMB1,950,000 0.10%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Selling
Shareholder Purchaser
Date of share
transfer agreement
Number
of Shares
transferred Consideration
Corresponding
approximate equity
interest in our Company
(upon completion of the
Series C Financing)
Equity Transfers between Shareholders in 2023
Xue Guangtao
(ᑡᄿᏹ)
V oicecomm Rongzhi May 25, 2023 30,000 RMB1,200,000 0.10%
Chenqi
Information
V oicecomm Rongzhi February 17, 2023 10,000 RMB650,000 0.03%
Jiageng
Culture
V oicecomm Rongzhi February 17, 2023 10,000 RMB650,000 0.03%
The consideration for the equity transfers above was determined after arm’s length
negotiations between the relevant parties following the same pricing basis as the Series C
Financing (save for the transfer between Mr. Xue Guangtao ( ᑡᄿᏹ) and V oicecomm Rongzhi,
which was determined after arm’s length negotiations between the parties and in accordance
with the original investment price of Mr. Xue Guangtao ( ᑡᄿᏹ), being RMB40 per Share,
when he acquired the Shares through the trading platform of the N Board).
Upon completion of the Series C Financing and the aforesaid concurrent equity transfers
in June 2023 (after also taking into account a number of share transfers conducted on the
platform of the N Board by the Shareholders since the completion of the Series B+ Financing
and up until the Withdrawal from Quotation on the N Board), the shareholding structure of our
Company was as follows:
Shareholder Number of Shares held
Shareholding
(Note 10)
V oicecomm Rongzhi (Note s1&6 ) 5,093,558 16.40%
Mr. Tang (Note s1&6 ) 3,498,000 11.26%
Yingke Jiyun (Note 2) 2,400,000 7.73%
Chenqi Information 2,327,000 7.49%
Jiaxing Shangyu (Note 3) 1,800,000 5.80%
Mr. Sun (Note s4&6 ) 1,800,000 5.80%
Jiaxing Chengshun Phase II 1,538,462 4.95%
Qingdao Yingke (Note 2) 1,250,000 4.02%
Mr. Qin 1,000,000 3.22%
Bodao Dinghua 750,000 2.41%
Gongqingcheng Huanping 745,000 2.40%
Xinzhuang Industrial Park 660,000 2.12%
Chengdu Technology Innovation
Investment 603,000 1.94%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Shareholder Number of Shares held
Shareholding
(Note 10)
Gongqingcheng Softbank 600,000 1.93%
Jiageng Culture (Note s4&6 ) 540,000 1.74%
Cuiwen Network 510,000 1.64%
Jiaxing Laida (Note 3) 500,000 1.61%
Zibo Bokai 500,000 1.61%
Huazi Shengtong 500,000 1.61%
Mr. Zhang Zhuo ( ੵՙ) 500,000 1.61%
Donghao Lansheng 500,000 1.61%
Zhejiang Jiuli Investment 461,538 1.49%
Neijiang High-tech Investment 461,538 1.49%
Mr. Yang Leizhe ( เᑜ䂮) 300,000 0.97%
Jinxuntong Software Technology 277,692 0.89%
Jingjin Investment 250,000 0.80%
Jiangfan Technology (Note s5&6 ) 240,000 0.77%
Mr. Luo Jun (ࠏ200,000 0.64%
Yuanzhi Xingjian (Note 7) 141,442 0.46%
Mr. Lu Liguang ( ጅᓿΈ) 125,000 0.40%
Ms. Pan Peihong (ߎ125,000 0.40%
Ms. Du Yingdong (؇ߵ100,000 0.32%
Mr. Bian Yulong ( ʼ͗Ꮂ) 100,000 0.32%
Shanghai Jiayuan Intelligent
Technology Co., Ltd. ( ɪऎྗӑ
ʮ̡) 100,000 0.32%
Shanghai Juntuo (Note 8) 100,000 0.32%
Mr. Yan Zhiqiang ( ᘌқ੶) 80,000 0.26%
Ms. Xu Ping ( ஢റ) 60,000 0.19%
Shandong Xizhan (Note 9) 50,000 0.16%
Mr. Ding Yi ( ɕᆇ) 50,000 0.16%
Ms. Song Qimin ( ҂ೡઽ) 50,000 0.16%
Zhuyi Enterprise Management 50,000 0.16%
Ms. Pan Qi ( ᆙ೘) 30,000 0.10%
Tongchuang Zhixing 22,000 0.07%
Jiangsu Xinzhi 20,000 0.06%
Mr. Feng Jian ( ඹ਄) (Note 8) 20,000 0.06%
Mr. Zhang Weihua ( ੵਃശ) 20,000 0.06%
Mr. Chen Xuanjun (ё)
(Note 7) 10,000 0.03%
Total 31,059,230 100.00%
Notes:
1. V oicecomm Rongzhi (formerly known as Shanghai Fengjing Information Consultation Co., Ltd. ( ɪऎ
ʮ̡)) is a company established in the PRC which was owned as to 99.00% by Mr.
Tang and 1.00% by Ms. Xu (the spouse of Mr. Tang). As a result, Mr. Tang was interested in an
aggregate of approximately 27.66% of the issued shares of our Company at the time.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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2. Yingke Jiyun and Qingdao Yingke are both managed by Yingke Innovation Asset Management Co., Ltd.
(ʮ̡) as their general partner. Yingke Jiyun and Qingdao Yingke together were
interested in an aggregate of approximately 11.75% of the issued shares of our Company at the time.
3. Jiaxing Shangyu and Jiaxing Laida are both managed by Shanghai Qifeng Investment Management Co.,
Ltd. (ʮ̡) as their respective general partner and fund manager. Jiaxing
Shangyu and Jiaxing Laida together were interested in an aggregate of approximately 7.41% of the
issued shares of our Company at the time.
4. Jiageng Culture is a company established in the PRC which was wholly-owned by Mr. Sun. As a result,
Mr. Sun was interested in an aggregate of approximately 7.54% of the issued shares of our Company
at the time.
5. Jiangfan Technology is a company established in the PRC which was wholly-owned by Jiangcheng Asset
Management, and which was in turn held as to 60.0% by Mr. Yang, our non-executive Director and
40.0% by Mr. Jiang Haisheng (ऎ͛).
6. Pursuant to the Concert Party Agreement dated March 20, 2021, Mr. Tang, Mr. Sun and Jiangfan
Technology agreed that they shall act in concert with respect to, inter alia, the right to convene board
meetings and general meetings, right to propose resolutions, nomination right, voting rights, nomination
of senior management, and other matters which are subject to approval in general meetings or board
meetings of the Company, for the period since the date of the Concert Party Agreement and up until they
cease to hold any shares of the Company or upon the termination of the Concert Party Agreement. For
details, see “Concert Party Arrangement” in this section below.
7. Mr. Chen Xuanjun (ё) is the general partner of Yuanzhi Xingjian. Accordingly, Mr. Chen Xuanjun
(ё) and Yuanzhi Xingjian together were interested in an aggregate of approximately 0.49% of the
issued shares of our Company at the time.
8. Shanghai Juntuo is wholly owned by Mr. Feng Jian. As a result, Mr. Feng Jian was interested in an
aggregate of approximately 0.38% of the issued shares of our Company at the time.
9. Shandong Xizhan is currently known as Shanghai Hengxi Private Equity Fund Management Co., Ltd.
(ʮ̡).
10. The aggregate of the percentage figures in the above table may not add up to 100% due to rounding of
the percentage figures to two decimal places.
Historical nominee arrangements and their termination
(i) Nominee arrangements between Shanghai Xiding and investors
As disclosed in the paragraph headed “Subscription of new Shares in 2016” in this section
above, Shanghai Xiding subscribed for 750,000 Shares and held such Shares in the capacity as
nominee shareholder for and on behalf of 17 investors (two of which being Mr. Yang and his
wife).
Each of such 17 investors had entered into a share investment agreement in 2015 with
Shanghai Xiding, our Company and Mr. Tang prior to the subscription of the Shares by
Shanghai Xiding, pursuant to which each investor had agreed to subscribe for the agreed
number of Shares at the consideration of RMB8.0 per Share, with Shanghai Xiding acting as
a nominee shareholder and held such subscribed Shares for and on behalf of the investors. As
confirmed by our Directors, the investors, Shanghai Xiding, our Company and Mr. Tang agreed
to the nominee arrangements to reduce the administrative burden of managing the investors.
All the nominee arrangements were terminated as at the Latest Practicable date, by the sale of
the relevant Shares by Shanghai Xiding through the trading platform of the N Board and the
return of sale proceeds to such investors.
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(ii) Nominee arrangement between Mr. Tang and Mr. Qin
Between 2015 and 2017, (i) Mr. Qin made an investment in the amount of RMB2.0
million to acquire 250,000 Shares from Mr. Tang (the “ Share Investment ”); and (ii) Mr. Tang
made several financial arrangements with Mr. Qin, pursuant to which Mr. Qin lent an aggregate
of RMB4.2 million (the “ Loans ”) to Mr. Tang. In 2018, Mr. Tang and Mr. Qin agreed to settle
the Loans by Mr. Tang transferring a total of 750,000 Shares to Mr. Qin. As Mr. Tang and Mr.
Qin did not immediately undergo the formal legal procedure to effectuate the transfer of Shares
under the Share Investment and the settlement of the Loans, they agreed that the concerned
aggregate of 1,000,000 Shares (the “ Settlement Shares ”) shall be continued to be held by Mr.
Tang for and on behalf of Mr. Qin for the time being. The nominee arrangement between Mr.
Tang and Mr. Qin was subsequently fully terminated in 2019 and the return of the Settlement
Shares was arranged through share transfers to Mr. Qin over the trading platform of the N
Board.
OUR SUBSIDIARIES
The following table sets out the details of our subsidiaries as at the Latest Practicable
Date:
Name of subsidiary
Place of
establishment
Date of
establishment
Registered
capital as at
the Latest
Practicable
date
Our
Company’s
effective
interest
Principal
business
activities
V oicecomm Yilian (Note 1) PRC July 13, 2020 RMB10
million
67% Software and
information
technology
services
Shandong V oicecomm
Information Technology
PRC November 10,
2020
RMB10
million
100% Software and
information
technology
services
Yuanya Information (Note 2) PRC July 27, 2017 RMB10
million
51% Software and
information
technology
services
Hainan V oicecomm
Intelligent Technology
PRC December 5,
2022
RMB10
million
100% Software and
information
technology
services
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Name of subsidiary
Place of
establishment
Date of
establishment
Registered
capital as at
the Latest
Practicable
date
Our
Company’s
effective
interest
Principal
business
activities
Shandong V oicecomm
Intelligent Technology
PRC April 20,
2021
RMB10
million
100% Software and
information
technology
services
Jinxun Digital Intelligence
(Note 3)
PRC July 7, 2022 RMB5.5
million
51% Software and
information
technology
services
V oicecomm Jiachen PRC August 30,
2022
RMB20
million
100% Software and
information
technology
services
V oicecomm Gengyou PRC May 10, 2023 RMB20
million
100% Software and
information
technology
services
V oicecomm Xuanwu PRC May 11, 2023 RMB20
million
100% Software and
information
technology
services
Chongqing V oicecomm PRC June 8, 2023 RMB10
million
100% Software and
information
technology
services
Sichuan V oicecomm Zhigan PRC June 28, 2023 RMB20
million
100% Software and
information
technology
services
V oicecomm Yunxiu PRC June 28, 2023 RMB20
million
100% Software and
information
technology
services
Sichuan V oicecomm Zhishi PRC July 31, 2023 RMB30
million
100% Software and
information
technology
service
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Name of subsidiary
Place of
establishment
Date of
establishment
Registered
capital as at
the Latest
Practicable
date
Our
Company’s
effective
interest
Principal
business
activities
Guang’an V oicecomm PRC August 23,
2023
RMB10
million
100% Software and
information
technology
services
Sichuan V oicecomm Yunji PRC April 19,
2024
RMB50
million
100% Software and
information
technology
service
V oicecomm (Hong Kong) Hong Kong May 24, 2024 HK$1 100% Software and
information
technology
service
Notes:
1. The remaining 33% of equity interests of V oicecomm Yilian was held by Shanghai Youjia Fire Engineering
Testing Co., Ltd. (ʮ̡), which is an Independent Third Party.
2. We acquired 51% of equity interests in Yuanya Information from Cuiwen Network in February 2021. As at the
Latest Practicable Date, Yuanya Information is held as to 51% by our Company and 49% by Cuiwen Network.
For details, see “Acquisitions during the Track Record Period” in this section below.
3. We acquired 51% of equity interests in Jinxun Digital Intelligence from Jinxuntong Software Technology in
December 2022. As at the Latest Practicable Date, Jinxun Digital is held as to 51% by our Company and 49%
by Jinxuntong Software Technology. For details, see “Acquisitions during the Track Record Period” in this
section below.
For changes in the registered capital of our subsidiaries, see “Statutory and General
Information – 3. Changes in the share capital of our subsidiaries” in this prospectus.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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ACQUISITIONS DURING THE TRACK RECORD PERIOD
Yuanya Information
Pursuant to an equity transfer agreement dated February 26, 2021 (as amended and
supplemented by two supplemental agreements dated February 27, 2021) entered into between,
among others, our Company, Cuiwen Network (a Pre-IPO Investor in our Series B Financing)
and Yuanya Information, we acquired from Cuiwen Network 51% of the equity interests of
Yuanya Information at the consideration of RMB20,400,000. The consideration was arrived
after arm’s length negotiation between the parties with reference to, among others, the
valuation of the intangible assets of Yuanya Information as of January 31, 2021 conducted by
an independent valuer, and the financial performance of Yuanya Information as of January 31,
2021. Yuanya Information is a limited liability company established in the PRC in 2017. It was
principally engaged in, among others, the development and sales of automobile direct sales
platforms, and it held 13 software copyrights (in relation to, among others, customer
relationship management, purchase order management, and automobile e-commerce platform)
at the time of its acquisition by our Group. The Directors believe the acquisition of a
controlling stake in Yuanya Information would have the following benefits:
(i) Technology synergy effect . Our Group is an upstream technology provider while
Yuanya Information is a downstream system integrator. Through the acquisition of
a majority stake in Yuanya Information, it could facilitate the resource and
technological knowhow sharing and communication between our Group and Yuanya
Information. On one hand, our Group could benefit from the knowhow of Yuanya
Information (including the software copyrights obtained along the acquisition) and
leverage on Yuanya Information’s understanding to the end users’ demands and
preferences accumulated over its years as system integrator, which could facilitate
our development of solutions that would better serve the end users’ needs, and thus
further promoting the competitiveness of our solution offerings. On the other hand,
Yuanya Information could benefit from our high-quality solutions, which could
promote customers’ satisfaction and potentially higher sales.
(ii) Market synergy effect . As both of our Group and Yuanya information have a broad
clientele in the automobile industry, the acquisition would enable our Group and
Yuanya to gain access to each other’s clientele, explore more potential business
opportunities, and potentially facilitating the market expansion for both parties and
expanding their revenue streams.
Upon completion of the acquisition on July 19, 2021, Yuanya Information became our
non-wholly owned subsidiary which is owned as to 51% by our Company and 49% by Cuiwen
Network. The financial information of Yuanya Information since the completion of the
acquisition has been reflected in our consolidated financial statements for the Track Record
Period. Our Directors have confirmed that none of the applicable percentage ratios as
stipulated under the Listing Rules of the above-mentioned acquisition of Yuanya Information
exceeds 25%. Accordingly, the acquisition of Yuanya Information during the Track Record
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Period does not amount to a major acquisition under Rule 4.05A of Listing Rules, and the
pre-acquisition financial information of Yuanya Information is not required to be disclosed
pursuant to Rule 4.05A of the Listing Rules. For details, see Note 34 to the Accountant’s Report
in Appendix I to this prospectus.
As confirmed by our Directors, our acquisition of Yuanya Information and the investment
of Cuiwen Network in the Series B Financing were not inter-conditional upon each other and
were both conducted after arm’s length negotiations between the relevant parties.
Jinxun Digital Intelligence
Pursuant to an equity transfer agreement dated November 28, 2022 (as amended and
supplemented by two supplemental agreements dated November 28, 2022 and June 2, 2023)
entered into between our Company, Jinxuntong Software Technology (a Pre-IPO Investor in the
Series C Financing) and Jinxun Digital Intelligence, we obtained 51% of the equity interests
of Jinxun Digital Intelligence partly through acquisition from Jinxuntong Software Technology
and partly through capital injection at the total consideration of RMB28,050,000. The
consideration was arrived after arm’s length negotiation between the parties, and was supported
by the valuation of the equity interests of Jinxun Digital Intelligence with December 30, 2022
as the reference date conducted by an independent valuer. Jinxun Digital Intelligence is a
limited liability company established in the PRC in 2022. It was principally engaged in, among
others, the operation of the “12345” government service platform and the big data governance
platform. The acquisition of a controlling stake in Jinxun Digital Intelligence would enable our
business expansion in the field of government service and big data governance.
Upon completion of the acquisition on December 30, 2022, Jinxun Digital Intelligence
became our non-wholly owned subsidiary which is owned as to 51% by our Company and 49%
by Jinxuntong Software Technology. The financial information of Jinxun Digital Intelligence
since the completion of the acquisition has been reflected in our consolidated financial
statements for the Track Record Period. Our Directors have confirmed that none of the
applicable percentage ratios as stipulated under the Listing Rules of the above-mentioned
acquisition of Jinxun Digital Intelligence exceeds 25%. Accordingly, the acquisition of Jinxun
Digital Intelligence during the Track Record Period does not amount to a major acquisition
under Rule 4.05A of Listing Rules, and the pre-acquisition financial information of Jinxun
Digital Intelligence is not required to be disclosed pursuant to Rule 4.05A of the Listing Rules.
For details, see Note 34 to the Accountant’s Report in Appendix I to this prospectus.
As confirmed by our Directors, our acquisition of Jinxun Digital Intelligence and
Jinxuntong Software Technology’s investment in the Series C Financing were not
inter-conditional upon each other and were both conducted after arm’s length negotiations
between the relevant parties.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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To the best knowledge and information of our Directors, save that (i) Cuiwen Network
and Jinxuntong Software Technology are our Pre-IPO Investors and currently our
Shareholders; (ii) one of the shareholders of Cuiwen Network, Mr. Wei Yangchun (݆is
a director, the legal representative and general manager of Yuanya Information; (iii) two of the
shareholders of Jinxuntong Software Technology, namely Mr. Han Zhaoning ( ᒵ̜ྐྵ) and Mr.
Shen Xiaobei ( ӏѽ̏), are the director, legal representative and general manager of Jinxun
Digital Intelligence and supervisor of Jinxun Digital Intelligence, respectively, Cuiwen
Network, Jinxuntong Software Technology and each of their respective shareholders/beneficial
owners has no other relationship with our Company, our Shareholder(s) and/or the connected
persons of our Company. As disclosed above, the considerations for acquisitions of Yuanya
Information and Jinxun Digital Intelligence have been arrived after arm’s length negotiation
between the relevant parties, and were supported by the relevant valuation on Yuanya
Information and Jinxun Digital Intelligence, respectively.
During the Track Record Period and up to the Latest Practicable Date, save as disclosed
above, our Group did not have any other significant acquisitions, disposals or mergers. As
advised by our PRC Legal Adviser, each of the above-mentioned acquisitions has been
conducted in compliance with applicable laws and regulations of the PRC and has been legally
completed and duly registered with local registration authorities of the PRC.
CONCERT PARTY ARRANGEMENT
Pursuant to the Concert Party Agreement dated March 20, 2021, Mr. Tang, Mr. Sun and
Jiangfan Technology agreed that they shall act in concert with respect to, inter alia, the right
to convene board meetings and general meetings, right to propose resolutions, nomination
right, voting rights, nomination of senior management, and other matters which are subject to
approval in general meetings or board meetings of the Company, for the period since the date
of the Concert Party Agreement and up until they cease to hold any Shares or upon the
termination of the Concert Party Agreement. In particular, among others, Mr. Tang, Mr. Sun
and Jiangfan Technology have agreed that (i) they shall reach consensus before voting
unanimously at the general meetings or board meetings of the Company; (ii) Mr. Tang and Mr.
Sun shall be responsible for the production and operation of the Company, and Jiangfan
Technology shall not involve in such matters; (iii) in the event consensus cannot be reached
among the parties, the parties shall follow the instruction of Mr. Tang; and (iv) upon the
execution of the Concert Party Agreement, all Shares directly or indirectly held by the parties
shall nonetheless be bound by the terms of the agreement, and the parties shall exercise their
voting rights in accordance with the Concert Party Agreement.
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As of the Latest Practicable Date, by virtue of the Concert Party Agreement, Mr. Tang,
Mr. Sun and Jiangfan Technology were collectively entitled to exercise voting rights of
approximately 35.97% of the voting rights in our Company, among which:
(i) Mr. Tang was able to exercise approximately 27.66% of the voting rights in our
Company through (a) his direct individual interest as to approximately 11.26%; and
(b) V oicecomm Rongzhi as to approximately 16.40%. V oicecomm Rongzhi is a
company established in the PRC which is owned as to 99.00% by Mr. Tang and
1.00% by Ms. Xu (the spouse of Mr. Tang);
(ii) Mr. Sun was able to exercise approximately 7.54% of the voting rights in our
Company through (a) his direct individual interest as to approximately 5.80%; and
(b) Jiageng Culture as to approximately 1.74%. Jiageng Culture is a company
established in the PRC which is wholly-owned by Mr. Sun; and
(iii) Jiangfan Technology was able to exercise approximately 0.77% of the voting rights
in our Company. Jiangfan Technology is wholly owned by Jiangcheng Asset
Management, which is in turn held as to 60.0% by Mr. Yang, our non-executive
Director, and 40.0% by Mr. Jiang Haisheng (ऎ͛).
In light of the above, Mr. Tang, Ms. Xu (the spouse of Mr. Tang holding 1% of equity
interests in V oicecomm Rongzhi), V oicecomm Rongzhi, Mr. Sun, Jiageng Culture, Mr. Yang,
Mr. Jiang Haisheng (ऎ͛) (holding indirectly 40% of equity interests in Jiangfan
Technology), Jiangfan Technology and Jiangcheng Asset Management (the holding company of
Jiangfan Technology) will be a group of Controlling Shareholders upon Listing. For details, see
“Relationship with our Controlling Shareholders” in this prospectus.
Background leading to Jiangfan Technology becoming a Shareholder and entering into
the Concert Party Agreement
Mr. Yang Xiaoyuan (our non-executive Director) and his spouse invested in our Company
back in 2015 through the nominee arrangements with Shanghai Xiding (for details, see
“Historical nominee arrangements and their termination – (i) Nominee arrangements between
Shanghai Xiding and investors” in this section below). Subsequently, upon the termination of
the relevant nominee arrangements and restoration of the relevant equity interests, the relevant
Shares were transferred to and held by Jiangfan Technology (a company indirectly held as to
60% by Mr. Yang Xiaoyuan) in March 2021 at the instruction of Mr. Yang Xiaoyuan and his
spouse.
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Mr. Yang Xiaoyuan and Mr. Tang both attended and graduated from Donghua University
(formerly known as China Textile University ( ʕ਷५ᔌɽኪ)) in 1999 and have been friends
for many years. He was nominated to the Board by Mr. Tang in May 2018, and had been
working alongside Mr. Tang and Mr. Sun for handling matters of the Board over the years. To
the best information and knowledge of our Directors, Mr. Yang Xiaoyuan was confident in the
leadership of Mr. Tang and Mr. Sun in our operation as well as the prospect of our Group.
Due to the dilution of shareholding interests following the several rounds of Pre-IPO
Investments, and by reasons of the longtime friendship and working relationship between Mr.
Yang Xiaoyuan and Mr. Tang, with a view to consolidate control of our Company and exert
greater influence on its management, Mr. Yang Xiaoyuan agreed to Jiangfan Technology
entering into the Concert Party Agreement with Mr. Tang and Mr. Sun.
PRE-IPO INVESTMENTS
The Pre-IPO Investments include: (i) Series A Financing; (ii) Series B Financing; (iii)
Series B+ Financing; (iv) Series C Financing; and (v) the 2023 Investments by Equity
Transfers. Our Company became acquainted with each of the Pre-IPO Investors through
various means such as introduction by the financial advisers engaged by our Company for the
purpose of the Pre-IPO Investments, through introduction by our Directors, Shareholders or
business partners or through networking events.
Series A Financing Series B Financing Series B+ Financing
Series C
Financing
2023 Investments
by Equity Transfers
Date of agreements See “Series A
Financing” in
this section
above.
See “Series B
Financing” in this
section above.
See “Series B+
Financing” in this
section above.
See “Series C
Financing” in
this section
above.
See “Concurrent
equity transfers”
in this section
above.
The last payment
date of
investment sum
in the relevant
round of
investment
September 29, 2020 July 28, 2021 October 12, 2022 June 25, 2023 May 26, 2023
Approximate cost
per Share paid
(1)
RMB15.00 RMB40.00 RMB40.00 RMB65.00 RMB65.00
Discount to the
Offer Price (2)
89.19% 71.16% 71.16% 53.14% 53.14%
Amount of
consideration
paid
RMB74,400,000 RMB140,400,000 RMB104,800,000 RMB179,999,940 RMB17,643,730
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Series A Financing Series B Financing Series B+ Financing
Series C
Financing
2023 Investments
by Equity Transfers
Use of proceeds
from the
Pre-IPO
Investments
The proceeds of the Pre-IPO Investments (other than the 2023 Investments by Equity Transfers) have been used to
finance (i) our business operation team development, business development and projects execution; and (ii) the
research and development of our Group. As of the Latest Practicable Date, the net proceeds from the Pre-IPO
Investments (other than the 2023 Investments by Equity Transfers) had been fully utilized.
Strategic benefits
of the Pre-IPO
Investors
brought to our
Company
At the time of the Pre-IPO Investments, our Directors were of the view that (i) the Pre-IPO Investments would
strengthen our shareholder base; and (ii) our Company could benefit from the additional capital from the Pre-
IPO Investor Investments and the Pre-IPO Investors’ knowledge and experience.
Furthermore, our Directors believe that the Pre-IPO Investments are demonstrations of confidence from the Pre-
IPO Investors in our operation, which serves as endorsements of our performance and prospects. Further, our
non-executive Directors represent certain of our Pre-IPO Investors and they complement our executive Directors
to support good corporate governance.
Lock-up Pursuant to the PRC Company Law, all the existing Shareholders (including the Pre-IPO Investors) are subject to a
12-month lock-up period from the Listing Date.
Notes:
(1) Calculated by dividing the total amount of the investment sums paid in the relevant round of financing with
the number of Shares acquired by the relevant investors before the Listing.
(2) Calculated based on the currency translation of HK$1 to RMB0.9120 and at the Offer Price of HK$152.10 per
H Share.
Special Rights of the Pre-IPO Investors
In connection with the pre-IPO investments, certain Pre-IPO Investors were entitled to
certain customary special rights, including among others, financial performance guarantee,
redemption right, information right, tag-along right, anti-dilution right, liquidation preferences,
director nomination right and prior consent for certain corporate actions (collectively the
“Special Rights ”).
In connection to the foresaid, pursuant to the supplemental agreements entered into,
among others, the Pre-IPO Investors and our Company, all the Special Rights have been
terminated automatically upon our Company’s submission of listing application for its listing
of H Shares on the Stock Exchange, provided that all such Special Rights shall automatically
be reinstated upon the earliest occurrence of any one of the following events: (i) the Listing
does not occur before December 31, 2024 (or December 31, 2025 for certain Pre-IPO
Investment); (ii) our Company withdraws its Listing application; or (iii) our Listing application
is rejected.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Information about our Pre-IPO Investors
Information of our Pre-IPO Investors (i.e. the investors in (i) the Series A Financing; (ii)
the Series B Financing; (iii) the Series B+ Financing; (iv) the Series C Financing; and (v) the
2023 Investments by Equity Transfers) are as set out below:
1. Gongqingcheng Softbank : Gongqingcheng Softbank is a limited partnership
established in the PRC and is managed by Gongqingcheng Softbank Zhongan
Investment Co., Ltd. (ʮ̡)( “ Softbank Zhongan ”) as its
general partner with approximately 80% partnership interest. Softbank Zhongan is
a limited liability company established in the PRC which is held as to 90% by Mr.
Ma Jun (ڲand 10% by Ms. Ma Tiantian ( ৵˂૴). Ms. Ma Tiantian is also the
sole limited partner of Gongqingcheng Softbank holding 20% partnership interest,
and currently serving as its supervisor and development manager. Gongqingcheng
Softbank engages in investment, with primary investment areas on, among others,
new energy industry, new material industry, healthcare, supply chain finance
industry, artificial intelligence industry, culture and tourism industry and
information technology industry, etc. Ms. Ma Tiantian is currently serving as our
non-executive Director.
2. Qifeng Investment (Jiaxing Shangyu & Jiaxing Laida) : Jiaxing Shangyu is a
private equity fund established in the PRC with investment focus in technology and
new generation information technology enterprises. Jiaxing Laida is a private equity
fund established in the PRC with investment focus in technology and new generation
information technology enterprises. Both Jiaxing Shangyu and Jiaxing Laida are
managed by Shanghai Qifeng Investment Management Co., Ltd. ( ɪऎ઼ჾҳ༟၍ଣ
ʮ̡)( “ Qifeng Investment ”) as their respective general partner and fund
manager, which held approximately 0.79% of the partnership interest in Jiaxing
Shangyu and approximately 0.50% of the partnership interest in Jiaxing Laida.
Qifeng Investment is a limited liability company established in the PRC and a
registered private fund manager under the relevant PRC Laws, which is owned as to
approximately 54.50% and 45.50% by Mr. Zhao Qi ( Ⴛೡ) and Mr. Zhao Fenggao
(Ⴛჾ৷), respectively. Jiaxing Shangyu has two limited partners, being Ms. Gu
Luying (ߵand Ms. Wang Weilu ( ˮၪⶨ), holding approximately 74.23% and
24.98% of the partnership interests in Jiaxing Shangyu, respectively. To the best
knowledge and information of our Directors, the said limited partners of Jiaxing
Shangyu are independent from each other. Jiaxing Laida has three limited partners,
being Ms. Wang Jing ( ˮ᎑), Mr. Zhao Fenggao ( Ⴛჾ৷) and Mr. Dong Zongde ( ໨
ᅃ), holding approximately 50.00%, 34.50% and 15.00% of the partnership
interests in Jiaxing Laida. To the best knowledge and information of our Directors,
the said limited partners of Jiaxing Laida are independent from each other.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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3. Yingke Innovation (Yingke Jiyun & Qingdao Yingke) : Yingke Jiyun is a private
equity fund established in the PRC with investment focus in industries including
healthcare, key & core technology and new energy. It is managed by Yingke
Innovation Asset Management Co., Ltd. (ʮ̡)( “ Yingke
Innovation ”) as its general partner and fund manager, holding directly
approximately 1.00% of partnership interest in Yingke Jiyun. Yingke Innovation is
a registered private fund manager under the relevant PRC law, and is ultimately
controlled by Mr. Qian Mingfei (࠭׼Yingke Jiyun has ten limited partners,
with the largest limited partner being Zibo Caijin Holding Group Co., Ltd. ( ଍௹̹
ʮ̡) directly holding approximately 24.5% of the partnership
interests in Yingke Jiyun. None of the other limited partners of Yingke Jiyun directly
holds more than 30% of the partnership interests in Yingke Jiyun.
To the best knowledge and information of our Directors, the details and background
of the limited partners of Yingke Jiyun are as follows:
Name of limited partner
Percentage of
partnership
interests in
Yingke Jiyun
Place of
establishment
Principal
business
Zibo Caijin Holding Group
Co., Ltd. (ණ
ʮ̡)( “ Zibo Caijin
Holding ”) (Note i)
24.50% PRC Including, among
others, venture
investment in
unlisted
companies and
engaging in
investment
activities with
proprietary
funds
Zibo Qixin Asset Management
Co., Ltd. (༟ପ၍ଣ
ʮ̡)( “ Zibo Qixin
AM”) (Note i)
19.50% PRC Including, among
others, trust
asset
management
and outward
investment
using
proprietary
funds
Changan Fortune Asset
Management Co., Ltd. (τ
ʮ̡)
(“Changan Fortune AM ”)
(Note ii)
14.78% PRC Specific client
asset
management
business
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Name of limited partner
Percentage of
partnership
interests in
Yingke Jiyun
Place of
establishment
Principal
business
Zibo Yingke Core Value No. 6
Venture Capital Partnership
(Limited Partnership)ޮ
ʬ໮௴ุҳ༟Υྫ
Άุ(Υྫ)) (“ Zibo
Yingke Venture Capital ”)
(Note iii)
13.35% PRC Including, among
others, venture
investment in
unlisted
companies and
engaging in
investment
activities with
proprietary
funds
Zibo Qilu Venture Capital Co.,
Ltd. (ࠢ
ப΂ʮ̡)( “ Zibo Qilu
Venture Capital ”) (Note i)
12.50% PRC Including, among
others, venture
investment in
unlisted
companies and
engaging in
investment
activities with
proprietary
funds
Zibo High-tech Industry
Investment Co., Ltd. ( ଍௹৷
ʮ̡)( “ Zibo
High-tech Industry
Investment ”) (Note iv)
5.00% PRC Including, among
others,
corporate
management
consulting and
engaging in
investment
activities with
proprietary
funds
Zibo Jincai Public Assets
Management Co., Ltd. ( ଍௹
ʮ̡)
(“Zibo Jincai ”) (Note v)
2.50% PRC Including, among
others, park
management
services and
engaging in
investment
activities with
proprietary
funds
Zibo Zichuan District Caijin
Holdings Co., Ltd. ( ଍௹̹଍
ʮ̡)
(“Zichuan Caijin
Holdings ”) (Note vi)
2.50% PRC Including, among
others, venture
investment in
unlisted
companies
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Name of limited partner
Percentage of
partnership
interests in
Yingke Jiyun
Place of
establishment
Principal
business
Zibo Wenchang Lake Public
Assets Management Co., Ltd.
(ಳʮϞ༟ପ຾ᐄϞ
ʮ̡)( “ Wenchang Lake
PAM”) (Note vii)
2.50% PRC Including, among
others,
government
entrusted public
asset
management
and urban and
rural
infrastructure
construction
Zibo Yingke Growth No. 9
Equity Investment
Partnership (Limited
Partnership) (ɘ
ᛆҳ༟ΥྫΆุ(Υ
ྫ)( “ Zibo Yingke Equity
Investment ”) (Note viii)
1.87% PRC Including, among
others, equity
investment,
investment
management,
and asset
management
Notes:
i. Zibo Caijin Holding, Zibo Qixin AM and Zibo Qilu Venture Capital are ultimately controlled by
Zibo Finance Bureau (҅).
ii. Changan Fortune AM is the asset manager of Changan Asset Hengfeng Bank Venture Capital
No. 1 Single Asset Management Plan (τ༟ପ㛬ᔮვБ௴ҳ1ྌ) and
represents such asset management plan to be a limited partner of Yingke Jiyun. Changan Fortune
AM is held as to 80% by Changan Fund Management Co., Ltd. (ʮ̡)
(“Changan Fund Management ”) and 20% by Shanghai Jingtang Enterprise Management
Consulting Partnership (Limited Partnership) (Άุ၍ଣፔ༔ΥྫΆุ(Υྫ)).
Changan Fund Management has five shareholders, with the largest shareholder being Changan
International Trust Co., Ltd. (ʮ̡)( “ Changan International Trust ”),
holding approximately 29.63% of equity interests in Changan Fund Management. Changan
International Trust has seven shareholders, with the largest being Xian Investment Holding Co.,
Ltd. (ʮ̡), holding approximately 40.44% of the equity interests in Changan
International Trust, which is in turn wholly-owned by the Xian Finance Bureau.
iii. Zibo Yingke Venture Capital is managed by Guangxi Yingji Investment Holdings Co., Ltd. ( ᄿГ
ʮ̡) as its general partner, holding approximately 1.67% of its partnership
interests. Guangxi Yingji Investment Holdings Co., Ltd. is controlled by Yingke Innovation. Zibo
Yingke Venture Capital has three limited partners, with Yingjia Keda Investment Co., Ltd.
holding approximately 97.50% of the partnership interests, which is in turn wholly-owned by
Yingke Innovation.
iv. Zibo High-tech Industry Investment is ultimately controlled by the Finance Bureau of Zibo
High-tech Industrial Development Zone (҅).
v. Zibo Jincai is wholly-owned by the Zibo Zhoucun Finance Bureau (҅).
vi. Zichuan Caijin Holdings is ultimately controlled by the Zibo Zichuan Finance Bureau ( ଍௹̹଍
҅).
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vii. Wenchang Lake PAM is held as to approximately 60.47% by Zibo Cultural Tourism Development
Group Co., Ltd. (ʮ̡) and 39.53% by the Finance Bureau of Zibo
Wenchang Lake Provincial Tourism Resort Management Committee (৿ਜ
҅). Zibo Cultural Tourism Development Group Co., Ltd. is indirectly held as to
approximately 99.10% by Zibo Finance Bureau (҅).
viii. Zibo Yingke Equity Investment is managed by Yingke Innovation as its general partner, holding
approximatel y1%o fi t s partnership interests. Yingjia Keda Investment Co., Ltd. (༺ҳ༟
ʮ̡) is the sole limited partner of Zibo Yingke Equity Investment, holding 99% of its
partnership interest and is wholly-owned by Yingke Innovation.
To the best knowledge and information of our Directors, save that (i) Zibo Caijin
Holding, Zibo Qixin AM, Zibo Qilu Venture Capital and Wenchang Lake PAM are
ultimately controlled by Zibo Finance Bureau (҅); (ii) Zibo High-tech
Industry Investment is ultimately controlled by the Finance Bureau of Zibo
High-tech Industrial Development Zone (҅);
(iii) Zibo Jincai is wholly-owned by the Zibo Zhoucun Finance Bureau ( ଍௹̹մӀ
҅); (iv) Zichuan Caijin Holdings is ultimately controlled by the Zibo
Zichuan Finance Bureau (҅); and (v) Zibo Yingke Venture
Capital and Zibo Yingke Equity Investment are both controlled by Yingke
Innovation, the limited partners of Yingke Jiyun are independent from each other.
Qingdao Yingke is a private equity fund established in the PRC with investment
focus in industries including healthcare, key & core technology and new energy. It
is also managed by Yingke Innovation. Qingdao Yingke has four limited partners,
being Qingdao City Investment Technology Development Co., Ltd. (ҳ௴ุ
ʮ̡), Yantai Chuangji Real Estate Co., Ltd. (ʮ̡),
Qingdao (Jiaozhou) Urban and Rural Community Construction Investment Co., Ltd.
(ࢥڡ(ᇭψ)ʮ̡) and Qingdao Huiquan Private Capital
Management Co., Ltd. (ʮ̡), holding approximately
86.00%, 10.00%, 2.00% and 1.00% of the partnership interests in Qingdao Yingke,
respectively. All the aforesaid limited partners of Qingdao Yingke are ultimately
controlled by the State-Owned Assets Supervision & Administration Commission of
Qingdao People’s Government (ึ). Mr.
Chen Yulei was nominated by Yingke Innovation to be our non-executive Director.
4. Xinzhuang Industrial Park : Xinzhuang Industrial Park is a state-owned limited
liability company established in the PRC, wholly owned by the State-owned Assets
Supervision and Administration Commission of Shanghai Minhang District ( ɪऎ̹
ึ). Xinzhuang Industrial Park primarily engaged in
establishment of industry park, attraction of investment, and corporate services, with
a focus on the development of electromechanical and automotive components, major
equipment, aerospace, electronic information, new materials, new energy and fine
chemicals, biopharmaceuticals and service-oriented manufacturing industries, etc.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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5. Zibo Bokai : Zibo Bokai is a limited liability company established in the PRC which
is wholly-owned by the Management Committee of Boshan Economic Development
Zone, Shangdong Province (ึ). Zibo Bokai is
mainly engaged in park development and supporting facilities construction.
6. Huazi Shengtong : Huazi Shengtong is a private equity fund established in the PRC
with investment focus in the fields of high-end equipment manufacturing, new
energy and new materials, and new generation information technology. It is
managed by Qingdao Science and Technology Venture Capital Co., Ltd. (߅
ʮ̡)( “ Qingdao Science and Technology Investment ”) as its
general partner and fund manager with approximately 0.50% partnership interest.
Qingdao Science and Technology Investment is a limited liability company
established in the PRC and a registered private fund manager under the relevant PRC
Laws. Huazi Shengtong has one limited partner, being Qingdao Huatong Venture
Capital Investment Co., Ltd. (ப΂ʮ̡)( “Huatong Venture
Capital ”), which holds 99.50% of partnership interest in Huazi Shengtong. Qingdao
Science and Technology Investment and Huatong Venture Capital are respectively
ultimately controlled by the State-Owned Assets Supervision & Administration
Commission of Qingdao Municipal People’s Government (਷Ϟ༟ପ
ึ).
7. Jingjin Investment : Jingjin Investment is a limited liability company established in
the PRC which primarily conduct investments in the fields of, among others,
information technology, intelligent manufacturing and energy saving and
environmental protection, healthcare, consumption and new energy. It is ultimately
held as to 99.00% by Mr. Wu Mengxia (ڪand 1.00% by Ms. Wu Mengxue ( ю
ྫྷ௛).
8. Cuiwen Network : Cuiwen Network is a limited liability company established in the
PRC which is owned as to 79.00% by Mr. Wei Yangchun (݆10.00% by
Shanghai Yuanya Enterprise Management Consulting Center (Limited Partnership),
6.00% by Mr. Li Yipeng ( ҽនᘄ), and 5.00% by Mr. Lu Bin ( ௔ⅳ). Shanghai
Yuanya Enterprise Management Consulting Center (Limited Partnership) is a limited
partnership established in the PRC which is held as to 80.25% by Mr. Wei Yangchun
(݆as its managing general partner, and 19.75% by Mr. Li Yipeng ( ҽនᘄ)a s
its limited partner. Cuiwen Network is principally engaged in the development and
application of software technology. In February 2021, separately from the Pre-IPO
Investments, we acquired 51% of the equity interests of Yuanya Information from
Cuiwen Network (which still held 49% of equity interests in Cuiwen Network as at
the Latest Practicable Date). For details of the said acquisition, see “Acquisitions
during the Track Record Period” in this section above.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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9. Gongqingcheng Huanping : Gongqingcheng Huanping is a government-led fund
established in the PRC with investment focus in energy saving and environmental
protection, new energy, new materials and high-tech manufacturing. It is managed
by Chongqing Environmental Protection Industry Private Equity Investment
Fund Management Co., Ltd. (ʮ̡)
(“Chongqing Environmental Fund ”) as its general partner and fund manager with
1.00% partnership interest in Gongqingcheng Huanping. Chongqing Environmental
Fund is in turn a limited liability company established in the PRC and a registered
private fund manager under the relevant PRC law.
To the best knowledge and information of our Directors, the details and background
of the shareholders of Chongqing Environmental Fund are as follows:
Name of shareholder
Percentage
of equity
interests in
Chongqing
Environmental
Fund
Place of
establishment Principal business
Chongqing Development
Investment Co., Ltd.
(ʮ
̡)( “ Chongqing
Development
Investment ”) (Note i)
33% PRC Including, among
others, engaging
in fund, equity,
and debt
investment and
management
Beijing Baishida
Investment Management
Co., Ltd. ( ̏ԯϵԫ༺
ʮ̡)
(“Beijing Baishida ”)
(Note ii)
28% PRC Project investment
management
China Green Enterprise
Limited (ࠢ
ʮ̡)( “ China Green
Enterprise ”) (Note iii)
18% PRC Primarily in the
environmental
industry, including
but not limited to
the development
of environment
management
information
system,
development of
environmental-
friendly
technologies and
product
manufacturing
investment
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Name of shareholder
Percentage
of equity
interests in
Chongqing
Environmental
Fund
Place of
establishment Principal business
Wuhu Conch Venture
Industrial Company
Limited ( ጾಳऎ௴ྼุ
ப΂ʮ̡)( “ Wuhu
Conch ”) (Note iv)
10% PRC Industrial
investment
Fengdu County State-
Owned Assets
Management Investment
Co., Ltd. ( ᔮேጤ਷Ϟ
ࠢ
ʮ̡)( “ Fengdu
SAMI”) (Note v)
6% PRC Including, among
others, state-
owned asset
management and
utilizing state-
owned assets for
project investment
(financing)
Beijing P.C. Lee Jiazhou
Beef Noodles King
Limited Company ( ̏ԯ
ҽ΋͛̋ψˬЂᙢɽˮ
ʮ̡)( “ P.C. Lee
Jiazhou Beef
Noodles ”) (Note vi)
5% PRC Catering
Notes:
i. Chongqing Development Investment is wholly-owned by Chongqing State-owned Assets
Supervision and Administration Commission (ึ).
ii. Beijing Baishida is held by five individuals, with the largest shareholder being Mr. Zhang Linbing
(ж), holding 25% of the equity interests of Beijing Baishida.
iii. China Green Enterprise is wholly-owned by the Foreign Environmental Cooperation Center,
Ministry of Ecology and Environment (ʕː).
iv. Wuhu Conch is ultimately wholly-owned by China Conch Venture Holdings Limited ( ʕ਷ऎᑮ
ʮ̡), a company whose shares are listed on the Stock Exchange (stock code: 586).
v. Fengdu SAMI is ultimately wholly-owned by Fengdu County State-owned Assets Affairs Center
(ᔮேጤ਷Ϟ༟ପԫਕʕː).
vi. P.C. Lee Jiazhou Beef Noodles is wholly owned by Mr. Lee Business Management Co., Ltd. ( ҽ
ʮ̡), which is in turn held as to approximately 52.09% by Beijing Baishida
and 47.91% by six other shareholders.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 215 ---
Gongqingcheng Huanping has two limited partners, being Guang’an Xiaoping
Hometown Development Fund Center (Limited Partnership) (ਿ
ʕː(Υྫ)) and Chongqing Environmental Protection Industry Equity
Investment Fund Partnership (Limited Partnership) (Υ
ྫΆุ(Υྫ)), which hold 49% and 50% of the fund interests in
Gongqingcheng Huanping, respectively. Guang’an Xiaoping Hometown
Development Fund Center (Limited Partnership) (ʕː(ࠢ
Υྫ)) is a private equity fund established in the PRC which is ultimately controlled
by the Guang’an Government State-owned Assets Supervision and Administration
Commission (ึ). Chongqing Environmental
Protection Industry Equity Investment Fund Partnership (Limited Partnership) (ᅅ
ΥྫΆุ(Υྫ)) is a private equity fund established in
the PRC which is managed by Chongqing Environmental Fund, and is held as to
approximately 31.00% by Wuhu Conch, 31.00% by Chongqing Development
Investment, 18.60% by Fengdu SAMI, 15.50% by P.C. Lee Jiazhou Beef Noodles,
3.10% by Beijing Baishida and 0.81% by Chongqing Environmental Fund. To the
best knowledge and information of our Directors, the limited partners of
Gongqingcheng Huanping are independent from each other.
10. Donghao Lansheng : Donghao Lansheng is a private equity fund established in the
PRC with investment focus in the field of human resource services. It is managed
by Shanghai Foreign Service Investment Management Co. Ltd (ᛆҳ༟
ʮ̡)( “ FSG Capital ”) as its general partner and fund manager. FSG
Capital is a limited liability company established in the PRC and a registered private
fund manager under the relevant PRC law. FSG Capital is owned as to (i) 35.00%
by Shanghai Foreign Service (Group) Co., Ltd. (؂(ණྠ)ʮ̡), which is
wholly-owned by Shanghai Foreign Service Holding Group Co., Ltd. (છ
ʮ̡) (a company listed on the Shanghai Stock Exchange, stock
code: 600662); (ii) 35.00% by Shanghai Hualin Equity Investment Management
Centre LLP (ᛆҳ༟၍ଣʕː(Υྫ)) (“ Hualin Equity
Investment ”), which is in turn managed by Shanghai Huatan Enterprise
Management Co., Ltd. (ʮ̡)( “ Huatan Enterprise ”) as its
general partner with 0.05% partnership interest. Huatan Enterprise is a limited
liability company established in the PRC which is principally engaged in enterprise
management consulting and financial consulting, and is controlled by Ms. Yang
Yanhua ( เᝣശ). Hualin Equity Investment has six limited partners, being Ms. Yang
Yanhua ( เᝣശ) holding 66.95% of its partnership interests, Mr. Wang Bo ( ˮ௹)
holding 19% of its partnership interests, Mr. Zhou Gaojie ( մ৷ᆎ) holding 7% of its
partnership interests, Mr. Ye Cheng ( ໢ϓ) holding 4% of its partnership interests,
Mr. Wang Anqi ( ˮτೡ) holding 2% of its partnership interests, and Shanghai
Guosheng Group Assets Co., Ltd. (ʮ̡)( “ Shanghai
Guosheng ”) holding 1% of its partnership interests. To the best information and
knowledge of our Directors, Shanghai Guosheng is a limited liability company
established in the PRC which is principally engaged in investments in the fields of,
among others, real estate and related industries and urban infrastructure, and is
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 216 ---
wholly owned by the Shanghai State-owned Assets Supervision and Administration
Commission (ึ); and (iii) 30% by Shanghai Yirui
Enterprise Management Partnership (Limited Partnership) ( ɪऎͺቚΆุ၍ଣΥྫ
Άุ(Υྫ)), which is in turn owned as to 51.00% by Mr. Zhu Nongfei (࠭)
and 49% by Ms. Wang Anqi ( ˮτೡ).
Donghao Lansheng has four limited partners. To the best knowledge and information
of our Directors, the details and background of the limited partners of Donghao
Lansheng are as follows:
Name of limited partner
Percentage of
partnership
interests in
Donghao
Lansheng
Place of
establishment
Principal
business
Shanghai Donghao
Lansheng Investment
Management Co., Ltd.
(खᚆ͛ҳ༟၍ଣ
ʮ̡)( “ Donghao
Lansheng Investment
Management ”) (Note i)
49.51% PRC Investment
management,
investment
consultancy,
asset
management
and
industrial
investment
Guotai Junan Zhengyu
Investment Co., Ltd.
(ࠢ
ʮ̡)( “ Guotai Junan
Zhengyu ”) (Note ii)
16.50% PRC Equity
investment
and financial
product
investment
Shanghai Zhangjiang
Technology Venture
Capital Co., Ltd.
(Ҧ௴ุҳ༟
ʮ̡)( “ Shanghai
Zhangjiang
Technology ”) (Note iii)
16.50% PRC Including,
among
others,
venture
capital
investments
in the
fields of
biomedicine,
information
technology,
new energy
and cultural
creativity
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 217 ---
Name of limited partner
Percentage of
partnership
interests in
Donghao
Lansheng
Place of
establishment
Principal
business
Shangnai Suhewan (Group)
Co., Ltd. (ᝄ(ණ
ྠ)ʮ̡)
(“Shangnai Suhewan
(Group) ”) (Note iv)
16.50% PRC Including,
among
others,
industrial
investment
and real
estate
investment
Notes:
i. Donghao Lansheng Investment Management is ultimately wholly-owned by the Shanghai
State-owned Assets Supervision and Administration Commission (ࡰ
ึ).
ii. Guotai Junan Zhengyu is wholly-owned by Guotai Junan Securities Co., Ltd. (΅
ʮ̡), a company whose H shares are listed on the Stock Exchange (stock code: 2611) and
the A Shares are listed on the Shanghai Stock Exchange (stock code: 601211). To the best
knowledge and information of our Directors, Shanghai State-owned Assets Management Co., Ltd.
(ʮ̡) is the largest shareholder of Guotai Junan Securities Co., Ltd. and
is ultimately wholly-owned by the Shanghai State-owned Assets Supervision and Administration
Commission (ึ).
iii. Shanghai Zhangjiang Technology is ultimately wholly-owned by Shanghai Pudong New Area
State-owned Assets Management Commission (ึ).
iv. Shanghai Suhewan (Group) is wholly-owned by Shanghai Jingan District State-owned Assets
Supervision and Administration Commission (ึ).
To the best knowledge and information of our Directors, save that (i) Donghao
Lansheng Investment Management and the largest shareholder of Guotai Junan
Zhengyu are controlled by Shanghai State-owned Assets Supervision and
Administration Commission (ึ); (ii) Shanghai
Zhangjiang Technology is wholly-owned by Shanghai Pudong New Area State-
owned Assets Management Commission (ึ);
and (iii) Shangnai Suhewan (Group) is wholly-owned by Shanghai Jingan District
State-owned Assets Supervision and Administration Commission ( ɪऎ̹᎑τਜ਷
ึ), the limited partners of Donghao Lansheng are independent
from each other.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 218 ---
11. Bodao Dinghua : Bodao Dinghua is a private equity fund established in the PRC
with investment focus in the emerging industries. It is managed by Chenguan
Dinghua (Hainan) Private Equity Fund Management Co., Ltd. ( ોᗫཻശ(ی)ӷ෍
ʮ̡)( “Chenguan Dinghua ”) as its general partner and fund manager
with 0.1% of partnership interest in Bodao Dinghua. Chenguan Dinghua is a limited
liability company established in the PRC and a registered private fund manager
which is ultimately wholly-owned by Zhongguan Fitness Asset Management Co.,
Ltd. (ʮ̡) (a state-controlled enterprise). Bodao Dinghua
has a sole limited partner, Yibin Xuzhou Productive Industry Investment Co., Ltd
(ʮ̡)( “ Yibin Chuangyi ”), with 99.9% of
partnership interest in Bodao Dinghua. Yibin Chuangyi is wholly-owned by the
Yibin Xuzhou District State-owned Assets Supervision and Administration Bureau
(Ⴗ̹ાψਜ਷Ϟ༟ପ္ຖ၍ଣ҅).
12. Chengdu Technology Innovation Investment : Chengdu Technology Innovation
Investment is a limited liability company established in the PRC with investment
focus in core technology projects and innovation technology, covering industries
including electronic information, biomedical, new material, new energy and
aerospace. Chengdu Technology Innovation Investment has a total of ten
shareholders, among which six of the shareholders, holding 85.6% of the equity
interests of Chengdu Technology Innovation Investment, were ultimately controlled
by Chengdu State-owned Assets Supervision and Administration Commission ( ϓே
ึ).
13. Tongchuang Zhixing : Tongchuang Zhixing is a limited partnership established in
the PRC, and is a follow-up investment platform for employees of Chengdu
Technology Innovation Investment. Tongchuang Zhixing is managed by Ms. Li
Wenjia ( ҽ˖Գ) as its general partner with approximately 29.41% of partnership
interest in Tongchuang Zhixing. Tongchuang Zhixing has three limited partners who
are individuals, holding approximately 29.41%, 23.53% and 17.65% of the
partnership interest in Tongchuang Zhixing, respectively. To the best information
and knowledge of our Directors, save that the said three individual limited partners
are all employees of Chengdu Technology Innovation Investment, they are
independent from each other.
14. Yuanzhi Xingjian : Yuanzhi Xingjian is a limited partnership established in the
PRC, and is managed by Mr. Chen Xuanjun (ё) as its general partner with
approximately 8.33% of partnership interest in Yuanzhi Xingjian. Yuanzhi Xingjian
has five limited partners, being Yuanzhi Tongchuang (Beijing) Information
Technology Co., Ltd. (Ν௴(̏ԯ)ʮ̡)( “ Yuanzhi
Tongchuang ”), Mr. Ren Guangfeng (ࢤMr. Xie Zhiren ( ᑽқʠ), Mr. Wang
Dajun (ࠏand Mr. Li Jianwei (ਃ), holding approximately 33.33%,
33.33%, 8.33%, 8.33% and 8.33% of the partnership interests in Yuanzhi Xingjian,
respectively. Yuanzhi Tongchuang is controlled by Mr. Wang Dajun. Yuanzhi
Xingjian principally engages in information technology services. To the best
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 219 ---
knowledge and information of our Directors, save that Mr. Wang Dajun (ࠏa
limited partner of Yuanzhi Xingjian) controls Yuanzhi Tongchuang (another limited
partner of Yuanzhi Xingjian), the limited partners of Yuanzhi Xingjiang are
independent from each other.
15. Jinxuntong Software Technology : Jinxuntong Software Technology is a limited
liability company established in the PRC, principally engaged in the development
and application of software technology. It is held as to 95% by Mr. Han Zhaoning
(ᒵ̜ྐྵ) and 5% by Mr. Shen Xiaobei ( ӏѽ̏).
16. Ms. Pan Qi ( ᆙ೘): Ms. Pan is an individual investor and she is currently an
employee of the Beijing branch of Yuanya Information. Ms. Pan has fifteen years of
experience in the consulting industry. Ms. Pan invested in our Company as she is
optimistic about the prospects of our Company.
17. Ms. Song Qimin ( ҂ೡઽ): Ms. Song is an individual investor. She was introduced
to our Group through one of the Pre-IPO Investors. To the best knowledge and
information of our Directors, Ms. Song decided to invest in our Company due to her
confidence to the prospect and growth potential of our Company.
18. Zhuyi Enterprise Management : Zhuyi Enterprise Management is a limited
partnership established in the PRC with investment focus in the intelligent
technology industry. It is managed by Shanghai Yujun Industrial Group Co., Ltd. ( ɪ
ʮ̡) as its general partner with 1% of partnership interest in
Zhuyi Enterprise Management. Zhuyi Enterprise Management has six limited
partners, Ms. Xiao Yujun (ё), Ms. Xu Oulian (ᖷᇳ), Mr.Yang Zhenji (ࣈ
ਿ), Ms. Ni Jian (ᄉ), Mr. Bu Fan ( ɥɭ) and Mr. Weng Qingfeng ( ॽᅅᔮ),
holding 29.00%, 20.00%, 20.00%, 10.00%, 10.00% and 10.00% of the partnership
interests in Zhuyi Enterprise Management, respectively. Shanghai Yujun Industry
Group Co., Ltd. is a limited liability company established in the PRC, and is held
as to 70% by Mr. Xiao Chongan ( ӽਫ਼τ) and 30% by Ms. Dong Aili ( ໨ฌᘆ). To
the best knowledge and information of our Directors, the limited partners of Zhuyi
Enterprise Management are independent from each other.
19. Jiaxing Chengshun Phase II : Jiaxing Chengshun Phase II is a limited partnership
established in the PRC with investment focus in the equity investment and industrial
investment. It is managed by Chengmeng (Shanghai) Equity Investment Fund
Management Co., Ltd. ( ༐ຑ(ɪऎ)ʮ̡)( “ Chengmeng
(Shanghai) ”) as its general partner with approximately 0.09% of partnership interest
in Jiaxing Chengshun Phase II. Chengmeng (Shanghai) is a registered private fund
manager under the relevant PRC Laws which is ultimately controlled by Mr. Fan Jue
(ᅾ䊌), who holds 70% of equity interests in Chengmeng (Shanghai). Jiaxing
Chengshun Phase II has three limited partners, being Mianyang Xintou Dinghua
Equity Investment Partnership (Limited Partnership) (ᛆҳ༟Υྫ
Άุ(Υྫ)), Jiangfan Technology and Shanghai Qiuteng Asset Management
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 220 ---
Co., Ltd. (ʮ̡), holding approximately 49.95%, 29.97% and
19.98% of the partnership interests in Jiaxing Chengshun Phase II, respectively.
Mianyang Xintou Dinghua Equity Investment Partnership (Limited Partnership) is
held as to (i) 99.90% by Mianyang Sci-Tech City New Area Investment Holding
(Group) Co., Ltd. (ٰ(ණྠ)ʮ̡), which is controlled
by Mianyang Sci-Tech City New Area Management Committee (อਜ၍
ึ); and (ii) 0.10% by Chenguan Dinghua. To the best knowledge and
information of our Directors, the limited partners of Jiaxing Chengshun Phase II are
independent from each other.
20. Zhejiang Jiuli Investment : Zhejiang Jiuli Investment is a limited liability company
established in the PRC with investment focus in new materials, new energy,
intelligent manufacturing and information technology. It is wholly owned by
Zhejiang Jiuli Hi-tech Metals Co., Ltd. (ʮ̡)( a
company listed on the Shenzhen Stock Exchange, stock code: 002318).
21. Neijiang High-tech Investment : Neijiang High-tech Investment is a limited
liability company established in the PRC. Neijiang High-tech Investment principally
engages in industrial investment, financial services and technology incubation, and
has an investment focus in electronic information technology, intelligent
manufacturing, software information, digital economy and new materials, etc. It is
wholly owned by Neijiang High-tech Industry Development Zone Management
Committee (ึ).
22. Mr. Zhang Weihua ( ੵਃശ): Mr. Zhang is an individual investor is experienced in
the technology and finance industries. Other than the investment in our Group, Mr.
Zhang had also invested in an environmental company in the PRC which principally
engaged in the building and restoration of aquatic environment and ecology.
23. Mr. Chen Xuanjun (ё): Mr. Chen is the general partner of Yuanzhi Xingjian,
one of the Series C Investors (For details of Yuanzhi Xingjian, see “14. Yuanzhi
Xingjian” above). Mr. Chen is experienced in the information technology service
industries. In addition to the investment in our Company, Mr. Chen had also invested
in two limited partnerships which engaged in the information technology service
industry.
To the best knowledge and information of our Directors, the Pre-IPO Investors decided
to invest in our Company due to their confidence in our prospect and growth potential. Save
as disclosed above and to the best knowledge of our Directors, our Pre-IPO Investors and their
ultimate beneficial owners are Independent Third Parties.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
–2 1 1–


--- page 221 ---
Compliance with Pre-IPO Investment Guidance
The Sole Sponsor confirms that the Pre-IPO Investments are in compliance with Chapter
4.2 of the Guide for New Listing Applicants published by the Stock Exchange, on the basis that
(i) the Listing will take place more than 120 clear days after the completion of the Pre-IPO
Investments, and (ii) no Special Rights will survive the Listing.
SHAREHOLDING STRUCTURE OF OUR COMPANY
The Company has applied for the Conversion of Unlisted Shares into H Shares, which
involves 8,625,913 Shares held by 30 Shareholders. The table below is a summary of the
shareholding structure of our Company as of the Latest Practicable Date and following the
completion of the Global Offering and the Conversion of Unlisted Shares into H Shares
(assuming the Over-allotment Option is not exercised):
As at the Latest
Practicable Date
Immediately following the completion of the Global Offering and Conversion of the
Unlisted Shares into H Shares (Assuming the Over-allotment Option is not exercised)
Unlisted Shares H Shares Unlisted Shares Total Shares
Shareholder
Number
of Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
Shareholding
in the H
Shares
Number of
Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
shareholding
in the total
issued Shares
Shareholdings holding Unlisted Shares upon Listing
(i) Core Connected Person
V oicecomm Rongzhi
(Notes 1 ,6&1 2 )
5,093,558 16.40% – – 5,093,558 22.71% 5,093,558 14.38%
Mr. Tang
(Notes 1 ,6&1 2 )
3,498,000 11.26% – – 3,498,000 15.59% 3,498,000 9.87%
Mr. Sun
(Notes 4 ,6&1 2 )
1,800,000 5.80% – – 1,800,000 8.02% 1,800,000 5.08%
Jiageng Culture
(Notes 4 ,6&1 2 )
540,000 1.74% – – 540,000 2.41% 540,000 1.52%
Jiaxing Chengshun
Phase II
(Notes 12 & 14)
1,538,462 4.95% – – 1,538,462 6.86% 1,538,462 4.34%
Gongqingcheng
Huanping
(Notes 12 & 14)
745,000 2.40% – – 745,000 3.32% 745,000 2.10%
Chengdu Technology
Innovation
Investment
(Notes 12 & 14)
603,000 1.94% – – 603,000 2.69% 603,000 1.70%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 222 ---
As at the Latest
Practicable Date
Immediately following the completion of the Global Offering and Conversion of the
Unlisted Shares into H Shares (Assuming the Over-allotment Option is not exercised)
Unlisted Shares H Shares Unlisted Shares Total Shares
Shareholder
Number
of Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
Shareholding
in the H
Shares
Number of
Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
shareholding
in the total
issued Shares
Zibo Bokai
(Notes 12 & 15)
500,000 1.61% – – 500,000 2.23% 500,000 1.41%
Neijiang High-tech
Investment
(Notes 12 & 14)
461,538 1.49% – – 461,538 2.06% 461,538 1.30%
Subtotal 14,779,558 47.59% – – 14,779,558 65.88% 14,779,558 41.72%
(ii) Other Shareholders
Xinzhuang Industrial
Park (Note 12)
660,000 2.12% – – 660,000 2.94% 660,000 1.86%
Donghao Lansheng
(Note 12)
500,000 1.61% – – 500,000 2.23% 500,000 1.41%
Ms. Xu Ping ( ஢റ)
(Note 12)
60,000 0.19% – – 60,000 0.27% 60,000 0.17%
Shanghai Hengxi
Private Equity Fund
Management Co.,
Ltd. ( ɪऎ㛬ഝӷ෍
ʮ̡)
(“Shanghai
Hengxi ”)
(Notes 11 & 12)
50,000 0.16% – – 50,000 0.22% 50,000 0.14%
Ms. Pan Qi ( ᆙ೘)
(Note 12)
30,000 0.10% – – 30,000 0.13% 30,000 0.08%
Tongchuang Zhixing
(Note 12)
22,000 0.07% – – 22,000 0.10% 22,000 0.06%
Jiangsu Xinzhi
(Note 12)
20,000 0.06% – – 20,000 0.09% 20,000 0.06%
Mr. Feng Jian ( ඹ਄)
(Note s8&1 2 )
20,000 0.06% – – 20,000 0.09% 20,000 0.06%
Subtotal 1,362,000 4.39% – – 1,362,000 6.07% 1,362,000 3.84%
(A) Total 16,141,558 51.97% – – 16,141,558 71.95% 16,141,558 45.57%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 223 ---
As at the Latest
Practicable Date
Immediately following the completion of the Global Offering and Conversion of the
Unlisted Shares into H Shares (Assuming the Over-allotment Option is not exercised)
Unlisted Shares H Shares Unlisted Shares Total Shares
Shareholder
Number
of Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
Shareholding
in the H
Shares
Number of
Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
shareholding
in the total
issued Shares
Shareholdings holding Unlisted and/or H Shares upon Listing
(i) Core Connected Person
Yingke Jiyun
(Note s2&1 5 )
2,400,000 7.73% 1,200,000 9.24% 1,200,000 5.35% 2,400,000 6.77%
Qingdao Yingke
(Note s2&1 5 )
1,250,000 4.02% 625,000 4.81% 625,000 2.79% 1,250,000 3.53%
Cuiwen Network 510,000 1.64% 400,000 3.08% 110,000 0.49% 510,000 1.44%
Jinxuntong Software
Technology
277,692 0.89% 138,846 1.07% 138,846 0.62% 277,692 0.78%
Jiangfan Technology
(Note s5&6 )
240,000 0.77% 72,000 0.55% 168,000 0.75% 240,000 0.68%
Bodao Dinghua
(Note 14)
750,000 2.41% 250,000 1.92% 500,000 2.23% 750,000 2.12%
Huazi Shengtong
(Note 15)
500,000 1.61% 500,000 3.85% – – 500,000 1.41%
Subtotal 5,927,692 19.09% 3,185,846 24.52% 2,741,846 12.22% 5,927,692 16.73%
(ii) Other Shareholders
Chenqi Information 2,327,000 7.49% 1,500,000
(Note 13)
11.55% 827,000 3.69% 2,327,000 6.57%
Jiaxing Shangyu 1,800,000 5.80% 1,300,000
(Note 13)
10.01% 500,000 2.23% 1,800,000 5.08%
Mr. Qin (Note 9) 1,000,000 3.22% 200,000
(Note 13)
1.54% 800,000 3.57% 1,000,000 2.82%
Gongqingcheng
Softbank
600,000 1.93% 150,000
(Note 13)
1.15% 450,000 2.01% 600,000 1.69%
Jiaxing Laida (Note 3) 500,000 1.61% 500,000
(Note 13)
3.85% – – 500,000 1.41%
Mr. Zhang Zhuo
(ੵՙ)
500,000 1.61% 250,000
(Note 13)
1.92% 250,000 1.11% 500,000 1.41%
Zhejiang Jiuli
Investment
461,538 1.49% 153,846
(Note 13)
1.18% 307,692 1.37% 461,538 1.30%
Mr. Yang Leizhe
(เᑜ䂮)
300,000 0.97% 250,000
(Note 13)
1.92% 50,000 0.22% 300,000 0.85%
Jingjin Investment 250,000 0.80% 125,000
(Note 13)
0.96% 125,000 0.56% 250,000 0.71%
Mr. Luo Jun (ࠏ
200,000 0.64% 200,000
(Note 13)
1.54% – – 200,000 0.56%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 224 ---
As at the Latest
Practicable Date
Immediately following the completion of the Global Offering and Conversion of the
Unlisted Shares into H Shares (Assuming the Over-allotment Option is not exercised)
Unlisted Shares H Shares Unlisted Shares Total Shares
Shareholder
Number
of Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
Shareholding
in the H
Shares
Number of
Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
shareholding
in the total
issued Shares
Yuanzhi Xingjian
(Note 7)
141,442 0.46% 70,721
(Note 13)
0.54% 70,721 0.32% 141,442 0.40%
Mr. Lu Liguang
(ጅᓿΈ)
125,000 0.40% 62,500
(Note 13)
0.48% 62,500 0.28% 125,000 0.35%
Ms. Pan Peihong
(ߎ)
125,000 0.40% 125,000
(Note 13)
0.96% – – 125,000 0.35%
Ms. Du Yingdong
(؇ߵ)
100,000 0.32% 100,000
(Note 13)
0.77% – – 100,000 0.28%
Mr. Bian Yulong
(ʼ͗Ꮂ)
100,000 0.32% 100,000
(Note 13)
0.77% – – 100,000 0.28%
Shanghai Jiayuan
Intelligent
Technology Co.,
Ltd. ( ɪऎྗӑ౽ঐ
ʮ̡)
100,000 0.32% 100,000
(Note 13)
0.77% – – 100,000 0.28%
Shanghai Juntuo
(Note 8)
100,000 0.32% 100,000
(Note 13)
0.77% – – 100,000 0.28%
Mr. Yan Zhiqiang
(ᘌқ੶)
80,000 0.26% 40,000
(Note 13)
0.31% 40,000 0.18% 80,000 0.23%
Mr. Ding Yi ( ɕᆇ) 50,000 0.16% 25,000
(Note 13)
0.19% 25,000 0.11% 50,000 0.14%
Ms. Song Qimin
(҂ೡઽ)
50,000 0.16% 50,000
(Note 13)
0.38% – – 50,000 0.14%
Zhuyi Enterprise
Management
50,000 0.16% 25,000
(Note 13)
0.19% 25,000 0.11% 50,000 0.14%
Mr. Zhang Weihua
(ੵਃശ)
20,000 0.06% 8,000
(Note 13)
0.06% 12,000 0.05% 20,000 0.06%
Mr. Chen Xuanjun
(ё) (Note 7)
10,000 0.03% 5,000
(Note 13)
0.04% 5,000 0.02% 10,000 0.03%
Subtotal 8,989,980 28.94% 5,440,067 41.87% 3,549,913 15.82% 8,989,980 25.38%
(B) Total 14,917,672 48.03% 8,625,913 66.40% 6,291,759 28.05% 14,917,672 42.11%
(C) Investors involved
in the Global
Offering (H
Shares)
– – 4,365,660 33.60% – – 4,365,660 12.32%
(A)+(B)+(C) 31,059,230 100% 12,991,573 100% 22,433,317 100% 35,424,890 100%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 215 –


--- page 225 ---
Notes:
1. V oicecomm Rongzhi was a company established in the PRC which was owned as to 99.00% by Mr. Tang and
1.00% by Ms. Xu (the spouse of Mr. Tang). As a result, Mr. Tang is deemed to be interested in the Shares held
by V oicecomm Rongzhi.
2. Yingke Jiyun and Qingdao Yingke are both managed by Yingke Innovation as their general partner, and they
together held approximately 11.75% of the total issued share capital of our Company as at the Latest
Practicable Date.
3. Jiaxing Shangyu and Jiaxing Laida are both managed by Shanghai Qifeng Investment Management Co., Ltd.
(ʮ̡) as their respective general partner and fund manager, and they together held
approximately 7.41% of the total issued share capital of our Company as at the Latest Practicable Date.
4. Jiageng Culture is a company established in the PRC which was wholly-owned by Mr. Sun. As a result, Mr.
Sun was deemed to be interested in the Share held by Jiageng Culture.
5. Jiangfan Technology is a company established in the PRC which was wholly-owned by Jiangcheng Asset
Management, and which was in turn held as to 60.0% by Mr. Yang, our non-executive Director and 40.0% by
Mr. Jiang Haisheng (ऎ͛).
6. Pursuant to the Concert Party Agreement dated March 20, 2021, Mr. Tang, Mr. Sun and Jiangfan Technology
agreed that they shall act in concert with respect to, inter alia, the right to convene board meetings and general
meetings, right to propose resolutions, nomination right, voting rights, nomination of senior management, and
other matters which are subject to approval in general meetings or board meetings of the Company, for the
period since the date of the Concert Party Agreement and up until they cease to hold any shares of the Company
or upon the termination of the Concert Party Agreement. For details, see “Concert Party Arrangement” in this
section above.
7. Mr. Chen Xuanjun (ё) is the general partner of Yuanzhi Xingjian. Mr. Chen Xuanjun (ё) and
Yuanzhi Xingjian together were interested in an aggregate of approximately 0.49% of the total issued share
capital of our Company at the time.
8. Shanghai Juntuo is wholly owned by Mr. Feng Jian. As a result, Mr. Feng Jian was interested in an aggregate
of approximately 0.38% of the issued shares of our Company at the time.
9. Mr. Qin was formerly our Director between July 2017 and November 2020. He was nominated by Mr. Tang
into the Board to primarily serve as his representative in the Board after Mr. Tang resigned from his
directorship in our Company in June 2017 (for details, please refer to Mr. Tang’s biography in “Directors,
Supervisors and Senior Management – Executive Directors” in this prospectus). In connection to the above,
in anticipation of Mr. Tang’s re-appointment as our Director in December 2020, Mr. Qin resigned from his
directorship in November 2020.
10. The aggregate of the percentage figures in the above table may not add up to the total due to rounding of the
percentage figures to two decimal places.
11. Shanghai Hengxi is formerly known as Shandong Xizhan.
12. These Shareholders have decided not to convert all or part of Unlisted Shares held by them to H Shares upon
Listing.
13. These H Shares will be counted towards the public float for the purpose of Rule 8.08 of the Listing Rules
immediately following the completion of the Global Offering and Conversion of the Unlisted Shares into H
Shares. For details, please refer to the paragraph headed “Public Float” in this section below.
14. The relevant Shareholder is ultimately under the supervision and management of the Sichuan Provincial
People’s Government. For details, please see the paragraph headed “Public Float” below in this section.
15. The relevant Shareholder is ultimately under the supervision and management of the Shandong Provincial
People’s Government. For details, please see the paragraph headed “Public Float” below in this section.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 226 ---
PUBLIC FLOAT
The 4,911,913 Unlisted Shares held by our Shareholders (other than those held by
V oicecomm Rongzhi, Mr. Tang, Mr. Sun, Jiageng Culture, Jiangfan Technology, Cuiwen
Network, Jinxuntong Software Technology, SD Control Entities and SC Control Entities (as
defined below)), representing approximately 15.81% of our total issued Shares as of the Latest
Practicable Date, or approximately 13.87% of our total issued Shares upon Listing (assuming
the Over-allotment Option is not exercised), or approximately 13.61% of our total issued
Shares upon exercise of the Over-allotment Option in full, will not be considered as part of the
public float as the Shares they hold are Unlisted Shares which will not be converted into H
Shares and listed following the completion of the Global Offering.
The 5,440,067 Unlisted Shares held by Chenqi Information, Jiaxing Shangyu, Mr. Qin,
Gongqingcheng Softbank, Jiaxing Laida, Mr. Zhang Zhuo ( ੵՙ), Zhejiang Jiuli Investment,
Mr. Yang Leizhe ( เᑜ䂮), Jingjin Investment, Mr. Luo Jun (ࠏYuanzhi Xingjian, Mr. Lu
Liguang ( ጅᓿΈ), Ms. Pan Peihong (ߎMs. Du Yingdong (؇ߵMr. Bian Yulong ( ʼ
͗Ꮂ), Shanghai Jiayuan Intelligent Technology Co., Ltd. (ʮ̡),
Shanghai Juntuo, Mr. Yan Zhiqiang ( ᘌқ੶), Mr. Ding Yi ( ɕᆇ), Ms. Song Qimin ( ҂ೡઽ),
Zhuyi Enterprise Management, Mr. Zhang Weihua ( ੵਃശ) and Mr. Chen Xuanjun (ё),
representing approximately 17.52% of our total issued Shares as at the Latest Practicable Date,
or approximately 15.36% of our total issued Shares upon Listing (assuming the Over-allotment
Option is not exercised), or approximately 15.08% of our total issued Shares upon exercise of
the Over-allotment Option in full, will be converted into H Shares and listed following the
completion of the Global Offering. As these entities will not be core connected person of our
Company upon Listing, are not accustomed to take instructions from core connected persons
in relation to the acquisition, disposal, voting or other disposition of their Shares and their
acquisition of Shares were not financed directly or indirectly by core connected persons, the
H Shares held by them will be counted towards the public float for the purpose of Rule 8.08
of the Listing Rules after the Listing.
V oicecomm Rongzhi, Mr. Tang, Mr. Sun, Jiageng Culture, and Jiangfan Technology are
part of the group of controlling shareholders of our Company as at the Latest Practicable Date,
and will remain as our group of Controlling Shareholders upon Listing. Yingke Jiyun and
Qingdao Yingke are both managed by Yingke Innovation, which is a substantial shareholder of
our Company. Further, more than 30% of the equity interests of Yingke Jiyun, Qingdao Yingke,
Huazi Shengtong and Zibo Bokai (“ SD Control Entities ”) are ultimately under the supervision
and management of the Shandong Provincial People’s Government, and SD Control Entities
collectively will hold more than 10% of our total issued Shares upon Listing (assuming the
Over-allotment Option is not exercised). Also more than 30% of the equity interests of Bodao
Dinghua, Chengdu Technology Innovation Investment, Jiaxing Chengshun Phase II, Neijiang
High-tech Investment and Gongqingchen Huanping (“ SC Control Entities ”) are ultimately
under the supervision and management of Sichuan Provincial People’s Government, and SC
Control Entities collectively will hold more than 10% of our total issued Shares upon Listing
(assuming the Over-allotment Option is not exercised). Cuiwen Network and Jinxuntong
Software Technology are respectively the substantial shareholder of Yuanya Information and
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 217 –


--- page 227 ---
Jinxun Digital Intelligence. As a result, the 20,707,250 Unlisted Shares (out of which
3,185,846 Shares will be converted into H Shares and listed following the completion of the
Global Offering, and 17,521,404 Shares will not be converted into H Shares), representing
approximately 66.67% of our total issued Shares as of the Latest Practicable Date, or
approximately 58.45% of our total issued Shares upon Listing (assuming the Over-allotment
Option is not exercised), or approximately 57.39% of our total issued Shares upon exercise of
the Over-allotment Option in full, controlled by V oicecomm Rongzhi, Mr. Tang, Mr. Sun,
Jiageng Culture, Jiangfan Technology, Cuiwen Network, Jinxuntong Software Technology, SD
Control Entities and SC Control Entities will not be counted towards the public float for the
purpose of Rule 8.08 of the Listing Rule after Listing.
Immediately upon completion of the Global Offering, assuming that (i) 4,365,660 H
Shares are issued and sold in the Global Offering; (ii) the Over-allotment Option is not
exercised; (iii) 35,424,890 Shares are issued upon completion of the Global Offering; (iv) the
Conversion of the Unlisted Shares into H Shares is completed, the total number of listed H
Shares held by the public represents approximately 27.68% of our total issued Shares upon
Listing. Therefore, our Company will be able to meet the minimum public float requirement
under Rule 8.08 of the Listing Rules.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 218 –


--- page 228 ---
OUR STRUCTURE IMMEDIATELY PRIOR TO THE GLOBAL OFFERING
The following chart sets forth our Group’s corporate structure immediately prior to the completion of the Global Offering and the Conversion
of Unlisted Shares into H Shares. (0)
V oicecomm
Rongzhi(1),(4)
99%
100%
Mr. Tang(1),(4) Mr. Sun(2),(4)
Jiageng Culture(2),(4)
Series A
Investors(5)
17.58%
Series B
Investors(6)
11.29%
Series B+
Investors(7)
8.43%
Series C
Investors(8)
8.91%
Jiangfan
Technology(3),(4)
Our Company
(PRC)
Corporate
Shareholders(9)
8.97%
Individual
Shareholders(10)
8.81%
16.40% 11.26% 1.74% 5.80% 0.77%
Shandong V oicecomm
Intelligent Technology
(PRC)
V oicecomm Jiachen
(PRC)
100%
Hainan V oicecomm
Intelligent Technology
(PRC)
100% 100%
V oicecomm
Gengyou
(PRC)
V oicecomm
Xuanwu
(PRC)
100%
Shandong V oicecomm
Information Technology
(PRC)
100%
V oicecomm
Yilian
(PRC)(11)
67%
Yuanya
Information
(PRC)(12)
51%
Jinxun Digital
Intelligence
(PRC)(13)
51%
Sichuan
V oicecomm Zhigan
ʢPRC)
100%
Sichuan
V oicecomm Zhishi
ʢPRC)
100%
Guang'an
V oicecomm
(PRC)
100%
Chongqing
V oicecomm
(PRC)
100%
V oicecomm
Yunxiu
(PRC)
100%
100%
Sichuan
V oicecomm Yunji
(PRC)
100%
V oicecomm
(Hong Kong)
(Hong Kong)
100%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 219 –


--- page 229 ---
Notes:
0. The aggregate of the percentage figures of shareholding interests in our Company in the chart may not add up
to 100% due to rounding of the percentage figures to two decimal places.
1. V oicecomm Rongzhi (formerly known as Shanghai Fengjing Information Consultation Co., Ltd. (ڦ
ʮ̡) is a company established in the PRC which was owned as to 99.00% by Mr. Tang and 1.00%
by Ms. Xu (the spouse of Mr. Tang). As a result, Mr. Tang was interested in an aggregate of approximately
27.66% of the issued shares of our Company at the time.
2. Jiageng Culture is a company established in the PRC which was wholly-owned by Mr. Sun. As a result, Mr.
Sun was interested in an aggregate of approximately 7.54% of the issued shares of our Company at the time.
3. Jiangfan Technology is a company established in the PRC which was wholly-owned by Jiangcheng Asset
Management, and which was in turn held as to 60.0% by Mr. Yang, our non-executive Director, and 40.0% by
Mr. Jiang Haisheng (ऎ͛).
4. Pursuant to the Concert Party Agreement dated March 20, 2021, Mr. Tang, Mr. Sun and Jiangfan Technology
agreed that they shall act in concert with respect to, inter alia, operation and business development related
matters of the Company which are subject to approval in general meetings or board meetings of the Company
since the date of the Concert Party Agreement and up until they cease to hold any shares of the Company. For
details, see “Concert Party Arrangement” in this section above.
5. Series A Investors refer to the following Pre-IPO Investors, which respectively holds the following
shareholding interests in our Company immediately prior to the completion of the Global Offering:
Name of Series A Investors
Percentage of
shareholding interests
in our Company
Yingke Jiyun* 7.73%
Jiaxing Shangyu # 5.80%
Xinzhuang Industrial Park 2.12%
Gongqingcheng Softbank 1.93%
Total 17.58%
* Yingke Jiyun and Qingdao Yingke are both managed by Yingke Innovation as their general partner.
# Jiaxing Shangyu and Jiaxing Laida are both managed by Shanghai Qifeng Investment Management Co.,
Ltd. (ʮ̡) as their respective general partner and fund manager.
6. Series B Investors refer to the following Pre-IPO Investors, which respectively holds the following
shareholding interests in our Company immediately prior to the completion of the Global Offering:
Name of Series B Investors
Percentage of
shareholding interests
in our Company
Qingdao Yingke* 4.02%
Cuiwen Network 1.64%
Jiaxing Laida # 1.61%
Zibo Bokai 1.61%
Huazi Shengtong 1.61%
Jingjin Investment 0.80%
Total 11.29%
* Yingke Jiyun and Qingdao Yingke are both managed by Yingke Innovation as their general partner.
# Jiaxing Shangyu and Jiaxing Laida are both managed by Shanghai Qifeng Investment Management Co.,
Ltd. (ʮ̡) as their respective general partner and fund manager.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 220 –


--- page 230 ---
7. Series B+ Investors refer to the following Pre-IPO Investors, which respectively holds the following
shareholding interests in our Company immediately prior to the completion of the Global Offering:
Name of Series B+ Investors
Percentage of
shareholding interests
in our Company
Bodao Dinghua 2.41%
Gongqingcheng Huanping 2.40%
Chengdu Technology Innovation Investment 1.94%
Donghao Lansheng 1.61%
Tongchuang Zhixing 0.07%
Total 8.43%
8. Series C Investors refer to the following Pre-IPO Investors, which respectively holds the following
shareholding interests in our Company immediately prior to the completion of the Global Offering:
Name of Series C Investors
Percentage of
shareholding interests
in our Company
Jiaxing Chengshun Phase II 4.95%
Zhejiang Jiuli Investment 1.49%
Neijiang High-tech Investment 1.49%
Jinxuntong Software Technology 0.89%
Mr. Zhang Weihua ( ੵਃശ) 0.06%
Mr. Chen Xuanjun (ё)* 0.03%
Total 8.91%
* Mr. Chen Xuanjun (ё) is the general partner of Yuanzhi Xingjian.
9. Corporate Shareholders refer to the following Shareholders, which respectively holds the following
shareholding interests in our Company immediately prior to the completion of the Global Offering:
Name of Corporate Shareholders
Percentage of
shareholding interests
in our Company
Chenqi Information 7.49%
Yuanzhi Xingjian* 0.46%
Shanghai Jiayuan Intelligent Technology Co., Ltd.
(ʮ̡) 0.32%
Shanghai Juntuo # 0.32%
Shanghai Hengxi 0.16%
Zhuyi Enterprise Management 0.16%
Jiangsu Xinzhi 0.06%
Total 8.97%
* Mr. Chen Xuanjun (ё) is the general partner of Yuanzhi Xingjian.
# Shanghai Juntuo is wholly-owned by Mr. Feng Jian ( ඹ਄).
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 221 –


--- page 231 ---
10. Individual Shareholders refer to the following Shareholders, which respectively holds the following
shareholding interests in our Company immediately prior to the completion of the Global Offering:
Name of Individual Shareholders
Percentage of
shareholding interests
in our Company
Mr. Qin 3.22%
Mr. Zhang Zhuo ( ੵՙ) 1.61%
Mr. Yang Leizhe ( เᑜ䂮) 0.97%
Mr. Luo Jun (ࠏ0.64%
Mr. Lu Liguang ( ጅᓿΈ) 0.40%
Ms. Pan Peihong (ߎ0.40%
Ms. Du Yingdong (؇ߵ0.32%
Mr. Bian Yulong ( ʼ͗Ꮂ) 0.32%
Mr. Yan Zhiqiang ( ᘌқ੶) 0.26%
Ms. Xu Ping ( ஢റ) 0.19%
Mr. Ding Yi ( ɕᆇ) 0.16%
Ms. Song Qimin ( ҂ೡઽ) 0.16%
Ms. Pan Qi ( ᆙ೘) 0.10%
Mr. Feng Jian ( ඹ਄)* 0.06%
Total 8.81%
* Shanghai Juntuo is wholly-owned by Mr. Feng Jian ( ඹ਄).
11. V oicecomm Yilian is a non-wholly owned subsidiary of our Company, which is held as to 67% by our Company
and 33% by Shanghai Youjia Fire Engineering Testing Co., Ltd. (ʮ̡), which is
an independent third party.
12. Yuanya Information is a non-wholly owned subsidiary of our Company, which is held as to 51% by our
Company and 49% by Cuiwen Network. For details, see “Acquisitions during the Track Record Period –
Yuanya Information” in this section above.
13. Jinxun Digital Intelligence is a non-wholly owned subsidiary of our Company, which is held as to 51% by our
Company and 49% by Jinxuntong Software Technology. For details, see “Acquisitions during the Track Record
Period – Jinxun Digital Intelligence” in this section above.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 222 –


--- page 232 ---
OUR STRUCTURE IMMEDIATELY FOLLOWING THE GLOBAL OFFERING
The following chart sets forth our Group’s corporate structure immediately after the Global Offering and the Conversion of Unlisted Shares
into H Shares (assuming no exercise of the Over-allotment Option). (0)
Other
Public Shareholders
of H Shares
V oicecomm
Rongzhi(1),(4)
99%
100%
Mr. Tang(1),(4) Mr. Sun(2),(4)
Jiageng Culture(2),(4)
Series A
Investors(5)
15.41%
Series B
Investors(6)
9.91%
Series B+
Investors(7)
7.40%
Series C
Investors(8)
7.82%
Jiangfan
Technology(3),(4)
Our Company
(PRC)
Corporate
Shareholders(9)
7.87%
Individual
Shareholders(10)
7.73% 12.32%
14.38% 9.87% 1.52% 5.08% 0.68%
Shandong V oicecomm
Intelligent Technology
(PRC)
V oicecomm Jiachen
(PRC)
100%
Hainan V oicecomm
Intelligent Technology
(PRC)
100% 100%
V oicecomm
Gengyou
(PRC)
V oicecomm
Xuanwu
(PRC)
100%
Shandong V oicecomm
Information Technology
(PRC)
100%
V oicecomm
Yilian
(PRC)(11)
67%
Yuanya
Information
(PRC)(12)
51%
Jinxun Digital
Intelligence
(PRC)(13)
51%
Sichuan
V oicecomm Zhigan
ʢPRC)
100%
Sichuan
V oicecomm Zhishi
ʢPRC)
100%
Guang'an
V oicecomm
(PRC)
100%
Chongqing
V oicecomm
(PRC)
100%
V oicecomm
Yunxiu
(PRC)
100%
100%
Sichuan
V oicecomm Yunji
(PRC)
100%
V oicecomm
(Hong Kong)
(Hong Kong)
100%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 223 –


--- page 233 ---
Notes:
0. The aggregate of the percentage figures of shareholding interests in our Company in the chart may not add up
to 100% due to rounding of the percentage figures to two decimal places.
1. V oicecomm Rongzhi (formerly known as Shanghai Fengjing Information Consultation Co., Ltd. (ڦ
ʮ̡) is a company established in the PRC which is owned as to 99.00% by Mr. Tang and 1.00%
by Ms. Xu (the spouse of Mr. Tang). As a result, Mr. Tang is interested in an aggregate of approximately
20.75% of the issued shares of our Company after the completion of the Global Offering.
2. Jiageng Culture is a company established in the PRC which is wholly-owned by Mr. Sun. As a result, Mr. Sun
is interested in an aggregate of approximately 5.65 % of the issued shares of our Company after the completion
of the Global Offering.
(3), (4) See the notes to “– Our Structure Immediately Prior to the Global Offering” in this section.
5. Series A Investors refer to the following Pre-IPO Investors, which respectively holds the following
shareholding interests in our Company immediately after the completion of the Global Offering:
Name of Series A Investors
Percentage of
shareholding interests
in our Company
Yingke Jiyun* 6.77%
Jiaxing Shangyu # 5.08%
Xinzhuang Industrial Park 1.86%
Gongqingcheng Softbank 1.69%
Total 15.41%
* Yingke Jiyun and Qingdao Yingke are both managed by Yingke Innovation as their general partner.
# Jiaxing Shangyu and Jiaxing Laida are both managed by Shanghai Qifeng Investment Management Co.,
Ltd. (ʮ̡) as their respective general partner and fund manager.
6. Series B Investors refer to the following Pre-IPO Investors, which respectively holds the following
shareholding interests in our Company immediately after the completion of the Global Offering:
Name of Series B Investors
Percentage of
shareholding interests
in our Company
Qingdao Yingke* 3.53%
Cuiwen Network 1.44%
Jiaxing Laida # 1.41%
Zibo Bokai 1.41%
Huazi Shengtong 1.41%
Jingjin Investment 0.71%
Total 9.91%
* Yingke Jiyun and Qingdao Yingke are both managed by Yingke Innovation as their general partner.
# Jiaxing Shangyu and Jiaxing Laida are both managed by Shanghai Qifeng Investment Management Co.,
Ltd. (ʮ̡) as their respective general partner and fund manager.
7. Series B+ Investors refer to the following Pre-IPO Investors, which respectively holds the following
shareholding interests in our Company immediately after the completion of the Global Offering:
Name of Series B+ Investors
Percentage of
shareholding interests
in our Company
Bodao Dinghua 2.12%
Gongqingcheng Huanping 2.10%
Chengdu Technology Innovation Investment 1.70%
Donghao Lansheng 1.41%
Tongchuang Zhixing 0.06%
Total 7.40%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 224 –


--- page 234 ---
8. Series C Investors refer to the following Pre-IPO Investors, which respectively holds the following
shareholding interests in our Company immediately after the completion of the Global Offering:
Name of Series C Investors
Percentage of
shareholding interests
in our Company
Jiaxing Chengshun Phase II 4.34%
Zhejiang Jiuli Investment 1.30%
Neijiang High-tech Investment 1.30%
Jinxuntong Software Technology 0.78%
Mr. Zhang Weihua ( ੵਃശ) 0.06%
Mr. Chen Xuanjun (ё)* 0.03%
Total 7.82%
* Mr. Chen Xuanjun (ё) is the general partner of Yuanzhi Xingjian.
9. Corporate Shareholders refer to the following Shareholders, which respectively holds the following
shareholding interests in our Company immediately after the completion of the Global Offering:
Name of Corporate Shareholders
Percentage of
shareholding interests
in our Company
Chenqi Information 6.57%
Yuanzhi Xingjian* 0.40%
Shanghai Jiayuan Intelligent Technology Co., Ltd.
(ʮ̡) 0.28%
Shanghai Juntuo # 0.28%
Shanghai Hengxi 0.14%
Zhuyi Enterprise Management 0.14%
Jiangsu Xinzhi 0.06%
Total 7.87%
* Mr. Chen Xuanjun (ё) is the general partner of Yuanzhi Xingjian.
# Shanghai Juntuo is wholly-owned by Mr. Feng Jian ( ඹ਄).
10. Individual Shareholders refer to the following Shareholders, which respectively holds the following
shareholding interests in our Company immediately after the completion of the Global Offering:
Name of Individual Shareholders
Percentage of
shareholding interests
in our Company
Mr. Qin 2.82%
Mr. Zhang Zhuo ( ੵՙ) 1.41%
Mr. Yang Leizhe ( เᑜ䂮) 0.85%
Mr. Luo Jun (ࠏ0.56%
Mr. Lu Liguang ( ጅᓿΈ) 0.35%
Ms. Pan Peihong (ߎ0.35%
Ms. Du Yingdong (؇ߵ0.28%
Mr. Bian Yulong ( ʼ͗Ꮂ) 0.28%
Mr. Yan Zhiqiang ( ᘌқ੶) 0.23%
Ms. Xu Ping ( ஢റ) 0.17%
Mr. Ding Yi ( ɕᆇ) 0.14%
Ms. Song Qimin ( ҂ೡઽ) 0.14%
Ms. Pan Qi ( ᆙ೘) 0.08%
Mr. Feng Jian ( ඹ਄)* 0.06%
Total 7.73%
* Shanghai Juntuo is wholly-owned by Mr. Feng Jian ( ඹ਄).
(11), (12), (13) See the notes to “– Our Structure Immediately Prior to the Global Offering” in this section.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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COMPANY OVERVIEW
Who We Are
We are an IT solution provider in China. Based upon our technologies, we provide
services for enterprise-level users to improve the level of convenience and intelligence for their
information exchanges and business interactions. Our solutions are built upon our technologies
comprising core conversational AI technologies, unified communication technologies, and
other AI and computer technologies. Our unified communication technologies, core
conversational AI technologies and product engine technologies address enterprise-level user’s
demand of “communication”, “thinking” and “execution”, respectively, thus facilitating a
complete enterprise-level conversational AI experience.
Our complete and extensively applicable “UC+AI” technological capabilities allow us to
offer several typical types of solutions that can be used by various enterprise-level users in a
number of prevalent interactive scenarios, primarily including contact service (as needed by
various types of organizations to communicate with individuals, with corporation’s customer
services as an example), equipment control and scheduling, enterprise communication and
management, as well as the operation of intelligent community and vehicle-to-everything
autonomous driving. During the Track Record Period, we primarily offered solutions to four
key end-customer industries where we had accumulated rich industry know-how, engineering
experiences and customer insights, i.e., city management and administration, automotive and
transportation, telecommunications, and finance. The footprints of our solutions have covered
more than 100 cities and counties in China and five overseas countries.
Our solution offerings are enabled by V oicecomm Brain, our technology infrastructure,
and V oicecomm Suites, our comprehensive functional modules. V oicecomm Brain is
underpinned by our core technologies in both unified communications and AI, and is able to
connect stably to enterprise-level users’ various types of operating systems. On top of our
robust V oicecomm Brain, we have developed a full set of V oicecomm Suites which
comprehensively cover various steps of enterprise-level users’ end-to-end information
exchanges and business interactions. The modular combination of such highly standard, highly
scalable and low-code V oicecomm Suites allows us to offer different types of solutions to
address the pain points experienced by enterprise-level users.
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Empowered by our comprehensive enterprise-level solution offerings and superior
delivery capabilities, our revenue increased rapidly during the Track Record Period, during
which time we also achieved continuously improving gross profit margin. The following table
sets forth our total revenue, gross profit and gross profit margin in each year during the Track
Record Period:
Y ear Ended December 31,
2021 2022 2023
Revenue (RMB’000) 459,935 514,992 813,017
Gross profit (RMB’000) 152,162 201,466 325,417
Gross profit margin (%) 33.1% 39.1% 40.0%
Thanks to our robust technology infrastructure and standardized solution offerings, we
are able to maintain stable profitability from our operations, with our adjusted net profit (a
non-IFRS measure) amounting to RMB62.3 million, RMB71.7 million and RMB117.7 million
in 2021, 2022 and 2023, respectively. Such growth was achieved despite our increasing
research and development expenses, which amounted to RMB36.3 million, RMB64.0 million
and RMB98.8 million in 2021, 2022 and 2023, respectively.
Market Opportunities
A new generation of information technologies including AI, cloud computing, big data
and 5G have been rapidly developing and iterating, massively transforming the paradigm of
enterprise-level information production, transmission and application. Accordingly, the
commercialization of enterprise-level conversational AI is embracing its inflection point, ready
to lay a crucial path for the improvement of communication efficiency, digitalization and
intelligent transformation of enterprise-level users. According to the iResearch Report, the
enterprise-level conversational AI solution market in China reached RMB62.1 billion in 2023,
and is expected to reach RMB204.1 billion in 2028, at a CAGR of 26.9% from 2023 to 2028.
However, the penetration rate of enterprise-level conversational AI solutions in China was
merely 11.6% in 2023, as compared to 18.2% for the U.S. according to the same source.
Currently, the penetration rate of enterprise-level conversational AI solutions in China still has
huge growth potentials, which is estimated to increase to 16.2% in 2028.
China’s enterprise-level conversational AI solution market is currently still experiencing
a number of pain points, which makes it especially challenging for non-full-stack solution
providers to fundamentally address the needs of enterprise-level users. Firstly, considering
enterprise-level users’ needs of conversational AI empowerment on a one-stop basis, each
product under non-full-stack solutions is independently designed and developed by different
providers, thus leading to a series of issues of compatibility, efficiency and maintenance, with
data silos left unconnected. Also, notwithstanding that enterprise-level users often need the
solutions to be highly scalable across various scenarios, non-full-stack solution providers may
not be able to realize the uniform management of the resulting solutions, making it challenging
to deliver a “ready-to-use-whenever-needed” user experience. Moreover, due to their lack of a
conversational AI infrastructure, non-full-stack solutions offered by such providers are
generally limited to the application layer, and they are hence unable to optimize the overall
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system according to the specific application scenarios. Further, while enterprise-level users
ultimately choose the delivery based on various specific considerations, it is difficult for
non-full-stack solution providers to deliver solutions flexibly to meet their rapidly iterative
business needs. Last but not least, according to the iResearch Report, the total cost of
ownership of procuring and integrating multiple non-full-stack solutions is about 15%-30%
higher than full-stack solutions due to functional redundancy and lack of standardization,
which also leads to uncertain return on investment.
In light of the above, it is expected that full-stack enterprise-level conversational AI
solution providers that possess unified communication and essential AI algorithm capabilities
with the ability to self-develop conversational AI applications will seize greater market
opportunities by fully exercising their technological advantages. By continuously exploring
into innovative application scenarios, we aim to solve the pain points of the industry and make
efficient enterprise-level communications at fingertips.
Our Solution Offerings
Through years of iterative research and development, we have offered various enterprise-
level solutions in a number of end-customer industries including city management and
administration, automotive and transportation, telecommunications, finance, as well as
education, healthcare, tourism, the media, E-commerce and retailing, etc., using V oicecomm
Brain and V oicecomm Suites, as illustrated by the following diagram:
City
Management and
Administration
Automotive and
Transportation
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ttttt
y
Telecommunications Finance
Communication ExecutionThinking
Multi-Media
Gateways
Intelligent
Softswitch
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Workflow
Tools
W
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ff
lol
Product
Tools
P
 dd
 t
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 P
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odu
Voicecomm
Suites
Voicecomm
Brain
Voicecomm
Solutions
Language
Understanding
L
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Knowledge
Graphs
Language
Generation
Speech
Recognition
Emotion
Recognition
Speech
Synthesis
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Our Solutions Applied in V arious End-Customer Industries – V oicecomm Solutions
Leveraging V oicecomm Brain and V oicecomm Suites, we have offered various types of
enterprise-level solutions proven to have effectively improved the level of convenience and
intelligence with respect to enterprise-level users’ information exchanges and business
interactions. In particular, our solutions have been used by enterprise-level users from various
end-customer industries, primarily including city management and administration, automotive
and transportation, telecommunications, and finance. We have also established and are further
expanding the presence of our solutions into other industries such as the media, healthcare,
E-commerce and retailing, etc., that can be empowered by conversational AI.
 City Management and Administration. Our solutions have primarily been applied
in intelligent community (comprehensive governmental projects involving diverse
application scenarios), intelligent administration and intelligent IoT, where our
technologies contribute to the establishment of smart cities where city
infrastructure, public spaces and objects are interactively connected, and also make
city management and administrative services more convenient and intelligent.
 Automotive and Transportation. Our solutions have primarily been applied in
customer service for automobile and logistics companies, IoV service that enables
a smart cockpit and facilitates the intelligent scheduling of vehicle resources and
route navigation, as well as V2X autonomous driving, which helps realize a safe,
convenient, intelligent and integrated automobile management and travel
experience.
 Telecommunications. Our solutions can empower telecommunications companies’
communication tools and other value-added services, such as cloud-based phone and
intelligent work badge. Such solutions allow various communication and
management needs of the enterprises that have procured such communication tools
and value-added services to be intelligently satisfied, while substantially lowering
deployment and maintenance costs.
 Finance. Our solutions offered to financial institutions have been applied primarily
in telephone banking, thereby upgrading their customer services and promoting the
comprehensive intelligent transformation of the finance industry. Additionally, we
also offer solutions in service training that facilitate their internal processes.
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Our Robust Technology Infrastructure – V oicecomm Brain
V oicecomm Brain, our technology infrastructure, is underpinned by our core technologies
in both unified communications and AI. V oicecomm Brain is able to connect stably to
enterprise-level users’ various types of operating systems, realizing the intelligent
transformation of their internal and external information exchanges and business interactions
from “communication” to “thinking” and “execution”. V oicecomm Brain affords enterprise-
level users with the following key values:
 Quality and Reliability. Having cumulatively served hundreds of enterprise-level
users for nearly two decades, we place great importance on the stability and
reliability of our technologies and solutions, for which reason we have been able to
win trust from the users of our solutions. Notably, V oicecomm Brain is able to
achieve a time interval between failures of 50 thousand hours, seamless redundant
switching of servers without user awareness, as well as an average multimodal
information transmission success rate of 99.999%, which lead above the industry
average in China according to the iResearch Report.
 High Compatibility. V oicecomm Brain is compatible with the three major
international protocols for computer telecommunications integration (CTI), i.e.,
TAPI, TSAPI and CSTA, and the three major types of signal communication
methods, i.e., analog transmission, digital transmission and SIP-based
communications. In addition, V oicecomm Brain is compatible with various types of
organizational operating systems, including but not limited to that on office
automation, customer relationship management and enterprise resource planning.
 Synergetic Technological Capabilities. Our core technologies in unified
communications and AI synergize with each other effectively. For instance,
leveraging our strong unified communication technological capabilities, our
voiceprint recognition technology is uniquely empowered by our technologies
analyzing the underlying communication protocols used for transmission of signals
via different terminal devices, which realizes the accurate audio source separation
and intelligent analysis of conversations involving multiple speakers.
 Cost Efficiency. We believe that V oicecomm Brain can realize cost efficiency for
users by significantly improving their communication efficiency with substantially
lowered costs, thereby facilitating the rapid expansion of their operation scale. Take
our conversational AI administrative service solution deployed in Zibo, Shandong as
an example, it enabled cost reduction by more than 85% compared with the solutions
previously used therein, while the efficiency for reaching out to callees increased by
tens of times and the administrative service completion rate exceeded 80%.
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Our Comprehensive Functional Modules – V oicecomm Suites
To realize large-scale deployment of our solutions and their quick replications in adjacent
use cases, we have developed a full set of functional modules, V oicecomm Suites, which
comprehensively cover various steps of enterprise-level users’ end-to-end information
exchanges and business interactions. The modular combination of such V oicecomm Suites
allows us to offer different types of solutions to address the pain points experienced by
enterprise-level users from various end-customer industries, and deliver the same flexibly and
selectably. The major features and advantages of V oicecomm Suites are as follows:
 Completeness. V oicecomm Suites in aggregate functionally enable the processing
and two-way transmission of the underlying communication signals, AI
empowerment in the application layer, and algorithm-equipped and productized
operational interface-side tools, so as to effectively empower the whole enterprise-
level conversational AI process from “communication” to “thinking” and
“execution” on a one-stop basis.
 High Standardization. Characterized by their high level of standardization,
V oicecomm Suites can empower users’ business operations in a cost-efficient
fashion. Besides, the standardization nature also helps us achieve economies of scale
by allowing us to readily replicate and adjust our solution offerings in similar
application scenarios.
 High Scalability. V oicecomm Suites support free combination among themselves
and output differently in accordance with users’ specific business needs, and also
enable interfacing with their various systems and software, through which we are
able to deliver comprehensive and highly scalable solutions and diversify the same
to the degree needed conveniently.
 Low-Code. V oicecomm Suites allow development personnel of users to realize the
software applications that they want based upon APIs in a low-code fashion
featuring high stability and easy-to-use, so that their concrete business requirements
and needs for cross-scenario application expansion could be satisfied with efficiency
and agility.
OUR COMPETITIVE STRENGTHS
We believe that the following strengths have contributed to our success and differentiated
us from our competitors:
A Seasoned IT Solution Provider with Nearly Two Decades’ Dedication to Enterprise-
Level Conversational AI
We are a seasoned provider of unified communications and AI-empowered solutions,
dedicated to facilitating enterprise-level communication for nearly two decades.
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Technological Innovations for Enterprise-Level Conversational AI
We have been dedicated to offering enterprise-level communication solutions for nearly
two decades, which has been crystalized in our integrated technology infrastructure capable of
intelligent communication, intelligent thinking and intelligent execution. According to the
iResearch Report, we are an early mover in China to have developed full-stack enterprise-level
conversational AI infrastructure and launched solutions based thereupon. Moreover, our
technological innovation capabilities have won us great prestige within the industry. For
instance, we have been granted with a number of reputed honors including the Shanghai
“Specialized, Refined, Characterized and Innovative” Small and Medium-Sized Enterprise, the
“Little Giant” Enterprise in 2019 and the “Golden V oice” – China Best All Media Intelligent
Customer Service Solution Award, 2021. For details of our major awards, honors and
recognitions, see “– Awards and Recognitions” in this section.
We are one of the few participants in the enterprise-level conversational AI solution
market in China with global service capabilities, according to the iResearch Report. Our
globally integrated delivery capabilities with respect to stable transmission of data and
high-concurrency scenarios have been highly recognized by enterprises that we serve, based on
which, we have become the long-term enterprise-level solution provider for a number of
industry giants in China with substantial overseas operations.
We have been continuously exploring into cutting-edge conversational AI technologies
and their commercialization applications. According to the iResearch Report, we are an early
mover in China to have launched visualizable and cross-carriers conversational AI customer
service solutions, and comprehensive ICV service platforms enabling a smart cockpit and V2X
autonomous driving.
Commercialization of Enterprise-Level Conversational AI
We have accumulated rich industry know-how, engineering experiences and customer
insights through, and in turn benefitting, our enterprise-level solution offerings. According to
the iResearch Report, we are one of the participants in the enterprise-level conversational AI
market in China with the broadest presence in different end-customer industries and the most
abundant application scenarios. In particular, our various types of solutions have been offered
to users across the following key end-customer industries:
 City Management and Administration. As of December 31, 2023, solutions of our
Company had been deployed in eleven provinces/municipalities across China.
According to the iResearch Report, we are one of the participants in the full-stack
enterprise-level conversational AI solution market in China with the widest
geographical coverage. Moreover, we rank the first in the full-stack enterprise-level
conversational AI solution market for city management and administration in China
as measured by revenue therefrom in 2023, according to the same source.
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 Automotive and Transportation. We are one of the earliest enterprise-level
solution providers that have penetrated into city-level autonomous driving,
according to the iResearch Report. As of December 31, 2023, we had accumulatively
served 17 automobile companies, ranging from traditional industry giants to
new-energy vehicle players and other automotive start-ups in the industry, as well
as a number of major logistics companies.
 Telecommunications. We have become a strategic conversational AI partner for the
four major telecommunications companies in China.
 Finance. As of December 31, 2023, we had accumulatively served 16 nationwide
financial institutions including banks and futures companies.
Complete Full-Stack Technology Infrastructure
Thoroughly utilizing our in-depth technological accumulations and rich experiences, we
have established our robust and complete full-stack technology infrastructure underpinned by
our core technologies in unified communications and AI.
Constantly Evolving Unified Communication Technologies
Our unified communication technologies are fundamental to successfully satisfying
enterprise-level users’ increasing demand for efficient and high-quality real-time
communications in a variety of forms, and unified in the sense of being equipped with the
following key capabilities:
 Multimodal Communications. Our unified communication technologies support
inbound and outbound communications in various formats, such as audios, texts,
images, videos, and a combination of the same, in a unified platform. Such
availability for multimodal communications enriches the information exchanged and
expands the forms of communications, which improves the communication
efficiency of users.
 Omni-Channel Access. Our unified communication technologies support two-way
transmission of information via various integratable channels, including those by the
internet-end, IoV-end, IoT-end and traditional channels, etc., which helps users
deploy and manage their communication platforms uniformly and conveniently.
 Compatibility with Different Communication Protocols. Our unified
communication technologies support the three major international CTI protocols,
i.e., TAPI, TSAPI and CSTA, and the three major types of signal communication
methods, i.e., analog transmission, digital transmission and SIP-based
communications, which substantially broadens their applicability and effectively
facilitates the smooth digital transformation of users’ IT infrastructure.
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 Operating System Integration. We have accumulated over 50 categories of APIs
and enabled the integration of more than ten types of organizational operating
systems, which help realize the unified collection and distribution of users’
operating data and simplify their operation processes, thus connecting data silos
within their internal organizations.
AI Technologies
Our AI technologies are composed of such key technologies including natural language
understanding (NLU), natural language generation (NLG), text to speech (TTS), automatic
speech recognition (ASR), emotion recognition and knowledge graphs, and thus realize the
high-speed and accurate recognition, understanding and response based upon multimodal data
through omni-channels. In combination with our in-depth technological accumulations in
unified communications, our AI technologies are of high compatibility and generality for being
widely applied in different scenarios, and have multiple-folded technological advantages in
regard of key functional measurements. Specifically:
 Superior Intelligent Processing Capabilities. We own competitive capabilities of
processing audio signals with respect to low sample-rate audios, self-adaptive and
accurate adjustments in complex signal transmission settings, as well as anti-
interference therefor. In particular, our technologies enable the intelligent
processing of low sample-rate audios the frequencies of which are as low as 8kHz.
 More Accurate Speech Recognition. Our AI technologies maintain a competitive
recognition accuracy rate in conversational scenarios involving multiple speakers.
In addition, our technologies can accurately recognize a variety of foreign languages
such as English, Vietnamese and Thai, etc., as well as Chinese dialects, which also
leads ahead the industry average. For instance, the accuracy rate for recognizing the
dialect from Anyang, Henan has reached 95.2%, based on our existing testing.
 Faster Speech Data Processing. To ensure a natural conversation flow, our AI
technologies are able to complete the whole interactive process from sound
collection, recognition, knowledge graph retrieval to speech synthesis and output on
a hundred millisecond basis.
 More Cutting-Edge Technologies with Huge Application Potentials. Our AI
models are designed, trained and optimized under our self-supervised leaning
framework, and are able to stably support multiple rounds of AI conversations,
which can be widely applied in emerging areas such as the newer generation of
digital human interactions, as well as V2X autonomous driving. With a number of
different types of AI algorithms accumulated, we have also developed our algorithm
engine capable of self-adaption to different scenarios to allow better performance of
our solutions.
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Highly Standardized and Scalable Offering Capabilities That Facilitate Solution
Launches and Continuously Improve Operating Efficiency
To facilitate the convenient and large-scale deployment of our enterprise-level solutions,
we have developed a full set of V oicecomm Suites that in aggregate functionally enable the
processing and two-way transmission of the underlying communication signals, AI
empowerment in the application layer, and algorithm-equipped and productized operational
interface-side tools, so as to effectively satisfy varied application demand of a wide range of
users on a one-stop basis. V oicecomm Suites allow us to deliver standardized solutions flexibly
and selectably, and cater to users’ specific needs by conveniently diversifying the same, as
evidenced by our speedy and replicable solution deployment in the following exemplary
projects:
 In our exemplary intelligent town project in Chengdu, Sichuan, our solutions
covered 257 towns within Chengdu as of December 31, 2023, where more than 80
million person-times had accumulatively been served based upon our solutions. In
addition, our similar solutions are being rapidly extended to a number of other
comprehensive governmental projects, such as the intelligent village project in
Deyang, Sichuan and the intelligent industrial park project in Chongming District,
Shanghai, across China.
 According to the iResearch Report, our “12345” hotline solutions had encompassed
the most number of prefecture-level administrative regions among participants in
the full-stack enterprise-level conversational AI solution market in China as of
December 31, 2023.
 In the ICV project in Zibo, Shandong, which was still ongoing and pending further
implementation as of the Latest Practicable Date, our technologies had already
successfully piloted 19 ICVs’ operation on an over 20-kilometer route. It is expected
that the project will be expanded from the project zone into the whole municipal area
in the future to empower more than 600 ICVs and provide intelligent transportation
services for more than three million citizens. Leveraging our rich experiences
accumulated from the successful launch of such project, we are able to readily
replicate similar solutions in other regions and assist more cities to build their
conversational AI-empowered intelligent transportation systems, thereby benefitting
tens of millions of people.
Meanwhile, the massive number of APIs that we provide enable us to not only lower
users’ costs of transferring between systems, but also contribute to the continuous
improvement of our operating efficiency. In addition, benefitting from the high standardization
of our solution offerings, the time length that we need to deploy our software installation
package onto to users’ systems from initiation of interfacing to completion of testing has been
shortened from multiple days to as few as several hours, which outperforms the industry
average that could range from a week to a month, according to the iResearch Report. Our
aforementioned outstanding deployment capabilities greatly contribute to our continuously
improved delivery efficiency and the ability to achieve economies of scale.
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Sustainable Growth Empowered by a Vibrant Conversational AI Ecosystem
We hold the belief that building a vigorous and diverse conversational AI ecosystem
enables players across the value chain to improve their productivity and prosperity, and also
enables us to realize sustainable development by gathering various resources. The key
components within the conversational AI ecosystem that foster our technological capabilities
and empower our commercialization success mainly comprise:
 Launch Customers. We believe that the launch customers in an end-customer
industry typically have considerable demand for enterprise-level conversational AI
and sufficient budgets. Such launch customers not only have strong stickiness to our
solutions, but also contribute significantly to the expansion of our customer base.
Specifically, serving the launch customers has been continuously improving our
conversational AI technological capabilities, degree of solution standardization,
service capabilities in complex scenarios and the replicability of our solutions,
during which process we are also able to accumulate vast industry know-how and
enhance our brand name. As such, we are able to further attract more quality
customers in multiple end-customer industries and geographical areas.
 Industrial Connections. We have established in-depth business relationships with
influential integrators, financial institutions, automobile companies and sensor
manufacturers, among others, as our customers, enterprise-level users or suppliers
across China, which facilitates us in providing and upgrading competitive and
commercially viable solutions. Moreover, such connections also inform us of the
latest development of conversational AI application scenarios of different end-
customer industries, and hence enables us to provide more users with solutions that
are more pertinent to their business needs.
In the course of our technological and solution innovations, we have also established
extensive connections with other AI technology companies. For instance, we have
become one of the first eco-partners of Baidu regarding the implementation of
ERNIE Bot, its chatbot product, into enterprise-level conversational AI application
scenarios. Leveraging our conversational AI technologies’ compatibility and their
ability to interface and coordinate with third-party models in specific solutions, we
can procure from Baidu APIs for ERNIE Bot. Specifically, we have realized the
connection of the large language model-based AI content generation capabilities of
ERNIE Bot with our NLG, TTS and multi-media gateway technologies, etc., in
development or testing environments, through which the two parties are able to
jointly serve relevant application scenarios. We expect that the centralized AI
services, large language model as well as general knowledge base underlying
ERNIE Bot will serve as beneficial complement to our distributed AI services,
models based on few-shot learning and professional knowledge base, which will
allow us to better focus on AI trainings relating to professional issues in specific
application scenarios.
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 Academic Alliances. We and the School of Electronic Information and Electrical
Engineering of Shanghai Jiao Tong University have jointly established the Research
Laboratory for AI Applications, which operates as a specific research and
development platform covering such primary conversational AI areas such as
voiceprint recognition, TTS, NLP and knowledge graphs, as well as fundamental
next-generation conversational AI studies and cutting-edge topics that are crucial for
our further growth prospects.
 Capital Partnerships. We have received strong endorsements from our diversified
strategic investors that include reputable local SOEs and industrial capitals, which
support our continuous expansion into different end-customer industries and
geographical areas. We will keep leveraging the synergetic effect between our
strategic investors and us to help with our business growth.
Industry-Dedicated and Visionary Management Team
Our success is to a large extent attributable to our diversified management team with
decades of dedications to the industry and sharp business visions, which is built up and
maintained embracing a cooperative culture. Led by such a reliable management team, we are
continuously advancing our technological innovations and commercialization progresses.
Both of our founder, Chairman and executive Director, Mr. Jinghua TANG, and our
executive Director and general manager, Mr. Qi SUN, have more than 20 years’ professional
experiences in the industry. Additionally, the core members of our management team have also
dedicated themselves to the industry averagely for more than ten years. Our experienced
management team features a collection of leaders in research and development,
commercialization, and sales and marketing, which empowers us to continuously improve our
industry insights, accurately seize business opportunities, and deftly deal with various
challenges and opportunities. The sharp business visions of our management team lie in their
leadership in constantly optimizing our technological paths and strategies by identifying the
promising intersection of various technological fields such as unified communications,
cloud-based computing and AI in a customer-oriented fashion. Accordingly, we have been able
to maintain our technological competitiveness and improve the standardization of our
solutions, which allows us to keep rapid growth.
As another demonstration of such sharp business visions, we have been constantly placing
great emphasis on our collaborations with renowned academics and influential scientists.
Thanks to our profound industrial accumulations and outstanding technological capabilities,
our pursuit of such collaborations has been met with warm response from the academia.
Academician Jifeng HE, a world-renowned computer scientist, joined us in 2023 as our Chief
Scientist. Graduated from the Mathematics Department of Fudan University in 1965,
Academician HE was elected to the Chinese Academy of Sciences in 2005. As a reputed
scientist with extensive scholarship experiences at top institutes across different countries,
Academician HE has led a number of national research programs and received numerous
prestigious science and technology awards. Academician HE is among the first few scientists
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in China to put forward the notion of responsible AI and facilitate the industrialization of the
same. His research on responsible AI fits nicely with our solutions in serving enterprise-level
application scenarios that necessitate high service professionality and output accuracy, and thus
have more promising commercialization potentials. As such, we believe that Academician HE’s
joining us will substantially enhance our fundamental technological capabilities in
conversational AI. Specifically, Academician He is responsible for our technological planning
in enterprise-level responsible AI and consulting on the application of our ICV solutions, which
we envision will greatly drive our technological accumulations in such areas with his academic
achievements.
The core members of our management team have been cooperating with each other for
more than 20 years, going through our evolvements in technologies, business models,
strategies and organizational structure hand-in-hand. We believe that such a stable and
mutually trusted management team can bring together needed resources to firmly execute our
core business strategies, thus helping us to grow steadily.
OUR STRATEGIES
Further Invest in Research and Development to Ensure the Leading Position and
Innovativeness of Our Conversational AI Technologies
We believe that maintaining competitiveness and innovativeness of our conversational AI
technologies lays the foundation of our business success, which allows us to acquire quality
customers, attract industry-leading talents and expand our market influence, as well as brings
us sustainable long-term prosperity. Aiming at satisfactorily serving enterprise-level users’
actual business needs, we will continue to invest in research and development so as to advance
the standardization of our enterprise-level solutions, as well as to iteratively develop more
application scenarios and innovative functions for the same. Specifically, we will continue to
enhance our technological capabilities by implementing our key technology initiatives such as
reinforcement learning, transfer learning and federated learning, visualizable conversational AI
empowered by computer vision AI and next-generation unified communications compatible
with visualizable conversational AI, so as to strengthen our competitiveness over existing and
emerging enterprise-level conversational AI solution providers, and maintain our
competitiveness and innovativeness of our conversational AI technologies.
To ensure effective implementation of our technology strategies, we will also expand our
research and development team on a continuous basis, recruit more industry-leading talents and
collaborate with more reputable laboratories and academic institutes, thereby nurturing an
innovative culture that appeals to and cultivates top conversational AI talents. Furthermore, we
had been establishing an AI empowerment computing center in Shandong as of the Latest
Practicable Date, which, equipped with ample GPU resources, could cloudify the computing
power and training of AI models. Through intelligent match-up of training assignments with
the computer resources, the completion rate of jobs training deep learning models through the
computing center can reach about 89.7% for GPU cluster, and the average GPU resource
utilization rate can reach about 58.0%.
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Strengthen Our Commercialization Capabilities by Enriching Our Solution Offerings
By leveraging our go-to-market strategies and accumulated industry insights proven to be
successful in serving our four key end-customer industries, we plan to accelerate our
penetration into other industries such as the media, healthcare, E-commerce and retailing, etc.,
in order to empower their intelligent transformation and improve our industry coverage.
Besides, fostered by our understanding of the existing users and our rich industry know-how,
we also aim to rapidly iterate our solution offerings, so as to expand our customers base, up-sell
our existing customers and increase their stickiness to our solutions, and ultimately increase
our market share. Specifically, we plan to serve a more diverse group of customers covering
governmental entities, large-scale state-owned enterprises and influential public companies,
among others. In addition, we plan to continue to enhance the standardization level of our
solutions and our delivery capabilities to more effectively reach a larger number of quality
customers in more end-customer industries and achieve profitability at scale.
With a goal to strengthen our commercialization capabilities effectively, we plan to
expand our in-house sales and marketing team by recruiting more professionals with rich
industry and customer insights. We believe that such personnel can help us capture the business
needs of users and the pain points of the industry, hence enabling our solutions to evolve at a
desirable pace.
Enhance Our Connections with Industrial Participant to Support a More Prosperous
Conversational AI Ecosystem that Further Realizes Sustainable Development
We have successfully built a vigorous and diverse conversational AI ecosystem. We
believe that the attraction and integration of value-carrying business partners can further
enhance our brand name, strengthen the competitiveness of our solutions, and achieve
reciprocal and sustainable development of the conversational AI ecosystem. Through
collaborations with such leading business partners, we will be able to acquire optimal industry
know-how and customer insights, which can further promote our development of preeminent
solutions. At the meantime, collaborating with system integrators with a cross-region and/or
cross-industry presence can extend our regional and industrial reach, and assist us in delivering
solutions that are better compatible with user needs.
With such belief, we intend to deepen our collaboration with our business partners within
the conversational AI ecosystem through resources sharing, strengths integration and mutual
empowerment, whereby we can grasp broad business opportunities. In addition, we also intend
to proactively identify and execute business acquisition opportunities throughout the upstream
and downstream industry chain, which we believe will serve as valuable supplement to our
existing conversational AI ecosystem and contribute to its long-term prosperity.
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Actively Expand into Southeast Asia and Other International Markets
We believe that various types of organizations across the globe commonly share the
pressing needs of intelligent transformation of their operations. As such, we plan to fully seize
business opportunities embedded within such trend by continuing to replicate our successful
domestic experiences into international markets. Specifically, we will solidify our first-mover
market advantages in Southeast Asia through the following endeavors. First, we will further
develop our technologies on recognizing less-spoken languages. Leveraging our ASR training
models and based upon our mature models developed for frequently spoken languages with
ample data samples, we will conduct transfer learning related trainings upon languages used in
Southeast Asia, such as Vietnamese and Thai, etc., to make the training models better
accommodate the characteristics of such languages and improve the recognition accuracy
therefor.
Through the aforementioned endeavors, we could overcome the technological difficulties
in achieving highly-accurate recognition of less-spoken languages traditionally bound by
limited data samples, and empower our customers/enterprise-level users with business
operations in Southeast Asia with enhanced communication efficiency. Second, we will further
our market explorations in Southeast Asia by leveraging our benchmark use cases therein, i.e.,
establishing multinational intelligent customer service centers for automobile and logistics
companies with international operations that were transnationally connected based on our
unified communication technologies and AI technologies. For details, see “– Our Solution
Offerings – V oicecomm Solutions – Automotive and Transportation – Case Study – Case Study
1: Multinational Intelligent Customer Service Centers” in this section. Such exemplary use
cases have demonstrated our accuracy of recognizing less-spoken languages which leads ahead
the industry average, as well as our ability to intelligently schedule customer service resources
in a multinational fashion.
We believe such use cases have showcased the robustness of our solutions and will
therefore help us achieve greater market acceptance in the Southeast Asia local market. In the
course of the increasing outbound expansion of other customers/enterprise-level users with
Southeast Asia footprints, we will be able to similarly demonstrate to them our transnational
service capabilities. In addition, the aforementioned amplification of our overseas presence
can also facilitate the expansion of our overseas operations by serving more offshore
customers/enterprise-level users directly. Specifically, supporting the international operations
of our current customers/enterprise-level users creates the opportunity for us to get visibility
to their regional partners, customers and vendors, among other local players, and showcase our
credentials to these prospect customers/enterprise-level users. This exposure will allow us to
forge direct relationships with new overseas targets. During the Track Record Period, we have
started to generate revenue from customers in Southeast Asia since 2023, and we plan to
gradually increase our overseas revenue going forward.
Moreover, overseas operations will significantly enrich our multilingual knowledge base,
which has great potentials to enhance our conversational AI technological accumulations and
commercialization experiences. Through the process of getting to know various complex
application scenarios and business requirements in a wider range of differentiated national,
geographical and/or organizational settings, we will continue to upgrade our technological
strengths, solution delivery capabilities and one-stop service abilities.
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OUR SOLUTION OFFERINGS
Our solution offerings are fundamentally enabled by V oicecomm Brain underpinned by
our core technologies in both unified communications and AI. Based upon V oicecomm Brain,
we have developed a full set of V oicecomm Suites, i.e., highly standardized, highly scalable
and low-code functional modules. Leveraging V oicecomm Brain and V oicecomm Suites, we are
able to offer various types of enterprise-level solutions that can be used by enterprise-level
users across a wide array of end-customer industries, primarily including city management and
administration, automotive and transportation, telecommunications, and finance.
Voicecomm Brain – Our Technology Infrastructure
V oicecomm Brain, our technology infrastructure, is underpinned by our core technologies
in both unified communications and AI. Our unified communication technologies are
fundamental to successfully satisfying enterprise-level users’ increasing demand for efficient
and high-quality real-time communications in a variety of forms, and our AI technologies
empower the “thinking” and “execution” processes of enterprise-level conversational AI. For
more details of our unified communication and AI technologies, see “– Our Technologies” in
this section.
Voicecomm Suites – Our Functional Modules
On top of our robust V oicecomm Brain, we have developed a full set of V oicecomm
Suites, i.e., highly standardized, highly scalable and low-code functional modules, which
comprehensively cover various steps of enterprise-level users’ end-to-end information
exchanges and business interactions. Such modules specifically include that on multi-media
gateways, intelligent softswitch, speech recognition, emotion recognition, language
understanding, language generation, speech synthesis, knowledge graphs, product tools and
workflow tools. The major features and advantages of V oicecomm Suites are as follows:
 Completeness. V oicecomm Suites in aggregate functionally enable the processing
and two-way transmission of the underlying communication signals, AI
empowerment in the application layer, and algorithm-equipped and productized
operational interface-side tools, so as to effectively satisfy varied application
demand of a wide range of users and empower their whole process from
“communication” to “thinking” and “execution” on a one-stop basis. Categorizable
in the manner below, V oicecomm Suites specifically include:
➢ Unified Communications Modules. Our multi-media gateways module supports
signal processing with respect to multimodal information such as audios, texts,
images and videos through different types of communication channels,
including those by the internet-end, IoV-end, IoT-end and traditional channels,
etc. Meanwhile, our intelligent softswitch module realizes the unified
integration of and interactions between such different communication
channels, providing users with a convenient and flexible communication
exchange system based on IPs that is internally and externally inter-connective
and allows two-way transmission and scheduling of extensive trans-modal and
trans-user terminal information and data.
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➢ AI Modules. After extensive trans-modal and trans-user terminal information
and data have been integrated into a unified platform, our complete AI
modules, consisting of recognitive modules (including speech recognition and
emotion recognition), natural language processing-related modules (including
language understanding and language generation) and speech synthesis
module, realize multiple rounds of meaningful and efficient human-machine
interactions based upon such information and data in an enterprise-level
setting. Additionally, such process is further empowered by our knowledge
graphs module intelligently achieving orderly knowledge accumulations,
graphical knowledge management and automatic reasoning and
recommendation.
➢ Product Engine Modules. Our product engine modules are backend procedure-
configuration software that enables enterprise-level users to conveniently
define external service processes, allocate communication resources, and
manage internal workflow through operative interfaces. Specifically, the
product tool module enables customization of conversation flows in a way
tailored to different scenarios and service processes involved, as well as
management of different communication channels to ensure smooth
information exchange and timely responsiveness. Our workflow tools module
allows enterprise-level users to manage work tickets and design procedures
across different departments, thereby improving enterprise-wide transparency
and efficiency. Our product engine modules can be seamless integrated with
our unified communications and AI modules, and realize enterprise-level
users’ external communication and internal management on a one-stop basis,
thus closing up the whole process of their end-to-end information exchanges
and business interactions straightforwardly without any cost of transferring
between systems.
 High Standardization. V oicecomm Suites are characterized by their high level of
standardization through our decades’ technological accumulations, and can
substantially lower users’ cost of use and operation and maintenance cost,
empowering their business operations in a cost-efficient fashion. Besides, the
standardization nature also helps us achieve economies of scale by allowing us to
readily replicate and adjust our solution offerings in similar application scenarios,
so as to shorten the research, development, deployment and commercialization
cycles.
 High Scalability. V oicecomm Suites support free combination among themselves
and output differently in accordance with users’ specific business needs, and also
enable interfacing with their various systems and software, through which we are
able to deliver comprehensive and highly scalable solutions and diversify the same
to the degree needed conveniently.
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 Low-Code. In addition to our ability to output our technological capabilities
through software development kits, V oicecomm Suites allow development personnel
of users to realize the software applications that they want based upon APIs. Such
free configuration of functions in a low-code fashion features high stability and
easy-to-use, so that their concrete business requirements and needs for cross-
scenario application expansion could be satisfied with efficiency and agility.
The completeness, high standardization, high scalability and low-code features of
V oicecomm Suites can effectively address a number of pain points manifested in enterprise-
level conversational AI solution market. As the choice of our customers, we are able to offer
different solutions through the modular combination of some or all V oicecomm Suites. Because
of the high synergies between unified communications and AI technologies, the typical types
of solutions that we offer to various enterprise-level users can primarily be used in such
prevalent interactive scenarios as contact service (as needed by various types of organizations
to communicate with individuals, with corporation’s customer services as an example),
equipment control and scheduling, enterprise communication and management, as well as the
operation of intelligent community and V2X autonomous driving. Leveraging our core
technologies’ completeness and extensive applicability to such interactive scenarios, we offer
a number of variant solutions to enterprise-level users from multiple end-customer industries
that facilitate and intelligently transform their respective form of information exchanges and
business interactions, which have primarily empowered:
City Management and Administration
 Intelligent community
 Intelligent administration (conversational AI-empowered contact service)
 Intelligent IoT (speech-based equipment control and scheduling)
Automotive and Transportation
 Customer service (conversational AI-empowered contact service)
 IoV service (speech-based equipment control and scheduling)
 V2X
Telecommunications
 Cloud-based phone (intelligent enterprise communication and management)
 Intelligent work badge (speech-based equipment management and scheduling)
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Finance
 Telephone banking (conversational AI-empowered contact service)
 Service training (intelligent enterprise communication and management)
The following diagram illustrates specifics of V oicecomm Suites as well as the major
solutions as applied in different end-customer industries that can be empowered thereby:
Internet-End
 Others
Online Chat
VoIP Phone
Smart Phone
SMS
WeChat
Car T-Box Camera Fax
Telephone
E-mail
……
Integratable
e Channels
City Management
and Administration
Automotive and
Transportation
 Telecommunications
 Other
Industries
Intelligent Community
Intelligent Administration
Intelligent IoT
Customer Service
IoV Service
V2X
Telephone Banking
Service Training
Cloud-Based Phone
Intelligent Work Badge
……
AI
Speech
Recognition
Language
Understanding
Language
Generation
Emotion
Recognition
Knowledge
Graphs
Speech
Synthesis
Unified
Communications
Product
Engine
A
I
Functional Modules
Finance
IoV-End IoT-End Traditional
End-Customer Industry Solutions
Voicecomm Solutions
Leveraging V oicecomm Brain and V oicecomm Suites, we are able to offer enterprise-level
solutions to effectively improve the level of convenience and intelligence with respect to
information exchanges and business interactions of enterprise-level users from various
end-customer industries. During the Track Record Period, we primarily offered our solutions
to four key end-customer industries where we had accumulated rich industry know-how,
engineering experiences and customer insights, i.e., city management and administration,
automotive and transportation, telecommunications, and finance, defined as the industry where
a certain enterprise-level user being empowered by solution(s) is from. We are also expanding
the presence of our solutions based upon existing V oicecomm Suites into other industries such
as the media, healthcare, E-commerce and retailing, etc., that can be empowered by
conversational AI.
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Our solutions are primarily based upon software systems designed and developed by us
catering to enterprise-level users’ concrete needs, which may also be offered in an integrated
manner, as the specific case may so request. In such software plus hardware solutions, we offer
hardware devices in which our software systems are embedded, network and other
telecommunication resources through which our technological capabilities are delivered,
and/or other service (if needed), etc., procured from suppliers.
City Management and Administration
We have a long history of providing solutions for local governments that meet their
various communication needs in their city management and administrative services since 2007.
The number of provinces/municipalities in which solutions in city management and
administration of our Company had been deployed during the Track Record Period expanded
from seven in 2021 to eight in 2022, and further to eleven in 2023, including such populous
provinces/municipalities as Sichuan, Beijing, Guangdong and Shanghai in which we focused
our penetrating efforts. According to the iResearch Report, we are one of the participants in the
full-stack enterprise-level conversational AI solution market in China with the widest
geographical coverage. Moreover, we rank the first in the full-stack enterprise-level
conversational AI solution market for city management and administration in China, as
measured by revenue therefrom in 2023, according to the same source. Specifically, we offer
solutions that are primarily used in the following areas:
 Intelligent Community. Through our technologies, the solutions that we offer in a
number of intelligent communities (such as intelligent towns and other similar
industrial parks) in China uniformly empower the digitalized operations of
numerous organizations and businesses stationed therein and the follow-up
development of software applications to be utilized therein, in the form of a
“intelligent platform”, so as to realize technological resource integration and
capacity precipitation. For details of our exemplary intelligent town project in
Chengdu, Sichuan, see “– Case Study – Case Study 1: Intelligent Town Project in
Chengdu” in this section.
 Intelligent Administration. The communication platforms that we establish for
local governments (such as “12345” hotlines and police hotlines) effectively support
their inbound/outbound contact needs, so as to help them fulfill their administrative
roles. According to the iResearch Report, our “12345” hotline solutions had
encompassed the most number of prefecture-level administrative regions among
participants in the full-stack enterprise-level conversational AI solution market in
China as of December 31, 2023. The hotlines we offer seamlessly integrate with
other administrative communication systems and intelligently transform
administrative services.
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 Intelligent IoT. We also offer solutions that can be applied in diverse scenarios
where city administrators have been increasingly exploring ways of digitally
transforming the landscape of city management by adopting various intelligent IoT
devices in areas ranging from public utilities to administrative facilities and
emergency response. Our technologies are widely applied therein to ensure the
reliable transmission and intelligent allocation of the unstructured data generated to
the relevant city administrative entities to facilitate their decision-making processes,
thus enabling the intelligent scheduling of administrative resources and the smooth
operation of an intelligent administration network.
Case Study
Case Study 1: Intelligent Town Project in Chengdu
China’s “Internet Plus” initiative was first proposed as a national strategy in the
government work report in March 2015 on the third session of the 12th National People’s
Congress of the PRC. In July 2015, the State Council released the Guiding Opinions on
Promoting the Development of “Internet Plus” (ጐ฽પආ“ʝᑌၣ+”ኬจԈ)
to promote in-depth integration of various traditional sectors with the internet. In 2016,
“Internet Plus” was enlisted in China’s 13th Five-Year Plan (2016-2020) as a prominent driver
of economic transformation and development, which aims to fuel economic growth by
integrating the internet with a great variety of sectors in economy and social life, such as
manufacturing, city management and administration, finance, healthcare, tourism, real estate
and agriculture. Seen as an important driving force for China’s economic and social innovation
and development, “Internet Plus” focuses on deepening the fusion of the internet, cloud
computing, and big data into national economy, thereby having great potential to foster new
economic forms, support mass entrepreneurship and innovation and provide a robust economic
growth engine.
In furtherance of the “Internet Plus” initiative, a number of cities and towns in China have
been adding intelligent elements to their local businesses. Starting from 2017, Chengdu,
Sichuan has been implementing its intelligent town project where the infrastructure,
administration, production and service activities, healthcare, security and educations, etc., of
more than 200 towns are being unified and integrated into one cloud-based platform, thereby
realizing the establishment of an intelligent town cluster that facilitates urban-rural
convergence. As such, the main purpose of our participation in the project was to facilitate the
establishment of a public service platform therein capable of unified communications and
equipped with AI technologies that could support the follow-up development of software
applications and integrate unstructured data. The following table sets forth the specific
V oicecomm Suites applied in and the key elements involved in our solutions for the project:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, intelligent
softswitch, speech recognition, emotion
recognition, language understanding,
language generation, speech synthesis,
knowledge graphs, product tools,
workflow tools
software systems, network resources,
maintenance and promotional services
for the town cluster
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In the project, we cooperated with the local telecommunications companies and
established a conversational AI-empowered digitalized technological infrastructure for the
intelligent town cluster in which we were primarily responsible for providing the
communication technological capabilities and AI technologies involved therein. Besides, we
have also been providing businesses stationed therein with conversational AI solutions for
various customer services, collection and distribution of data, as well as other value-added
services that involve intelligent unification of communications based on the infrastructure.
Specifically, our unified communication technologies could realize the coding and
transmission of videos and audios, as well as other signals, underlying various interactive
scenarios within the town cluster, and, on top of which, our core conversational AI
technologies could then intelligently transform such interactions. See below for concrete
technological steps involved in the management and operations of the intelligent town cluster’s
tourism functions that were empowered by our unified communication and core conversational
AI technologies:
 Platform Management. By contrast to traditional communications technology
facilitating data transmission via singular medium form, our unified communication
technologies enabled the transmission of text, audio, image and video signals
concerning onsite tourists to the tourism management center for its to manage the
same in an integrated manner. Equipped with such multimodal information, the
center could have a holistic and real-time understanding of visitor amount,
activeness and traffic, etc., allowing it to effectively schedule tourism management
personnel and other resources; and
 Visitor Communication. Commercial tenants stationed within the town cluster and
the social media platform of the said tourism management center were also equipped
with intelligent virtual agents empowered by our comprehensive core conversational
AI technologies. Such intelligent virtual agents were able to more intelligently serve
the visiting tourists than traditional tourist-town visitor services enabled solely by
human agent seats that are oftentimes faced with issues with language barriers,
untimely feedback and inconsistent service quality, etc. Specifically, our ASR
technology enabled visitors to verbally inquire about attractions, restaurants, hotels
and various other services through interactive voice communications in different
Chinese dialects, and our NLU technology could parse the spoken questions to
derive contextual meaning and visitors’ intent. During the same process, our
emotion recognition technology could also analyze emotions of the speaking visitors
manifested in the conversation through extracting acoustic features from speech
signals, such as tone, volume and speed. Based upon such analysis of the visitors’
intent and emotions, our NLG technology accordingly provided relevant answers or
recommendations by leveraging integrated knowledge graphs covering points of
interest, events, transportation options and more. The system could then deliver
responses via natural-sounding speech synthesized using our TTS technology.
Leveraging our technological accumulations in customer service related scenarios,
our TTS technology is able to output natural speech in tones that sound polite and
caring in tourism settings, so as to improve the complete interactive experiences. As
such, our technologies made the visitor services more accessible, engaging and
standardized.
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In addition to our unified communication and core conversational AI technologies, our
product engine technologies facilitated the operation of the town cluster primarily by realizing
(i) the flexible configuration of various service procedures involved in the diverse scenarios
within the town cluster such as citizen services, administrative management and tourism; and
(ii) the efficient scheduling and management of service personnel through the identification,
tracking and resolution of events based upon an integrated workflow management platform
cross different departments.
Besides our technological outputs, we have also provided management-side interfaces
visualizing the analysis and assisting the local administrators to effectively and conveniently
manage the intelligent town cluster. The following graphic is a screenshot of a unified interface
comprehensively illustrating the real-time status with respect to the facility integration,
advertising, governance monitoring and user behavioral statistics of the intelligent town
cluster:
2
3
1
4
5
Notes:
(1) Basic information, including the theme of the interface, access date and time
(2) Display of information including total amount of facilities integrated, their distribution by facility category,
online rate, and facility status, etc.
(3) Display of information including real-time sales statistics of the merchants integrated, user access status, and
product transaction rankings, etc.
(4) Display of real-time local events reported and the visualized analysis and statistics of the same, as well as the
corresponding monitor screen image, etc.
(5) Display of information including total visitor amount, their basic demographics and geographical origins,
visitor traffic by time phase, subsequent activities, and ways of traveling, etc.
As of December 31, 2023, our solutions had covered 257 towns within Chengdu, where
more than 80 million person-times had accumulatively been served based upon our
technologies. In addition, our similar solutions are being rapidly extended to a number of other
comprehensive governmental projects, such as the intelligent village project in Deyang,
Sichuan and the intelligent industrial park project in Chongming District, Shanghai, across
China. We believe that the benefits of our participation in the project are multiple-folded.
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Empowering the establishment of the intelligent town cluster through network resources that
are fundamental to carrying our conversational AI technological capabilities, we will then be
able to quickly acquire a mass of new customers who have arising yet unsatisfied demand for
intelligent communications that can be sufficiently addressed by our conversational AI
technologies. During the same process, we are also able to expand our sales channel and
presence in wider geographical areas of China. As such projects are being increasingly
launched across China, as supported by the aforementioned “Internet Plus” initiative and a
number of other favorable industrial policies stimulating the development of digital economy,
unified communications and AI technologies, we believe that we are able to further seize the
business opportunities in the substantial release of digitalization potentials for city
management and administration.
Case Study 2: Conversational AI “12345” Hotline Solutions
Local governments in China have been increasingly emphasizing the significance of their
“12345” hotlines as a valuable channel to improve the quality and level of their governance,
and leveraging the information generated therefrom as a key basis for evaluating the work
conducted by their departments. However, the efficiency of such hotlines sometimes fails to
meet the city administrators’ expectations due to the limited response speediness and varied
service quality of human agent seats only, especially when the request volumes and hotline
traffic skyrocket during material events affecting regional municipal management such as a
pandemic outbreak. Moreover, insufficient interconnectivity between different administrative
communication systems can cause multiple departments being repetitively involved in the
issue-solving processes, and the multifarious information and numerous work tickets generated
from such hotline are often featured by overly highly granularity, unless engaging cumbersome
human-based content analyses, categorizations and assignment distributions. As a result,
citizens’ requests or complains may not be able to be allocated to the relevant departments and
cleared timely and accurately, which will also render the governmental decision-making and
evaluation processes ill-informed. Accordingly, we have offered conversational AI “12345”
hotline solutions in a number of cities mainly for the purpose of effectively solving the
aforementioned issues in a conversational AI-empowered manner. Specifically, our core
conversational AI technologies can assist human agent seats to understand, reply to and
document calling citizens’ requests and improve their service quality, and our unified
communication technologies, through integrating multiple communication channels into a
unified platform, expand the handling scope of such hotlines pre-call and facilitate the
issue-solving process post-call. The following table sets forth the specific V oicecomm Suites
applied in and the key elements involved in our solutions:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, intelligent
softswitch, speech recognition, emotion
recognition, language understanding,
language generation, speech synthesis,
knowledge graphs, product tools,
workflow tools
software systems, maintenance services
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See below for concrete technological steps involved in the operation of such “12345”
hotlines that can be empowered by our core conversational AI technologies:
 Dialect Recognition. Various Chinese dialects in different regions have substantial
differences from Mandarin in pronunciation, tones, vocabularies, etc., which can
make it difficult for human agent seats to understand the requests of callers speaking
in dialects and result in poor communication outcomes. In this regard, the
effectiveness and accuracy of interactions between human agent seats and the
calling citizens across a wide range of geographical areas in China are ensured by
our strong ASR technological capabilities of recognizing Chinese dialects. We have
extensive accumulations in dialect recognition, and are able to conduct model
training and optimization based upon the specific characteristics of different dialects
to realize accurate recognition. For instance, our accuracy rate for recognizing the
dialect from Anyang, Henan has reached 95.2%;
 Automatic Reply. Human agent seats serving hotlines that are purely enabled
thereby need to manually look up relevant background information pertaining to the
calling citizens’ questions and answer accordingly. By contrast, our NLU
technology supports the automatic search of pertinent answers from backend
systems or against service protocols, and reply accordingly. This saved searching
and processing time therefore shortens the service process per call and improves the
hotlines’ operation efficiency;
 Work Ticketing. In the case of citizen requests that would need further handling by
being distributed to the relevant departments, human agent seats usually need to
spend a substantial amount of time analyzing and summarizing the requests, which
is not only inefficient but also prone to error. Rather, our ASR and NLG technologies
allow intelligent analysis of the work tickets automatically generated thereby, and
grouping of the same based on factors including subject matters, localities,
competent authorities, and levels of priority, therefore allowing them to be
accurately distributed to the relevant departments;
 Quality Assurance. Our ASR technology also enables 100% full-volume
performance quality assessment on the agent seats’ service process, which lifts the
burden of human-based conversation quality assurance characterized by selective
assurance due to high-volume conversations to be assessed versus limited number of
quality assurance analysts (for instance, a 50-personnel human agent team will
typically generate recordings of 160 hours per day, and normally one or two analysts
are engaged but merely able to selectively cover about 2% of the recordings per day,
with their standards inevitably difficult to be unified); and
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 Automatic Feedback Collection. Our NLG and TTS technologies also enable
automatic return calls to collect feedback on the status of request completion and
thus conveniently satisfy city administrators’ outbound communication needs,
especially during material events, without cumbersome human agent involvement.
These technologies not only improve citizens’ satisfaction with the hotlines’
operations but also ensure the responsiveness of the administrative service
platforms.
See below for concrete technological steps involved in the operation of such “12345”
hotlines that can be empowered by our unified communication technologies:
 Platform Integration. Our unified communication technological capabilities could
realize the integration of the hotlines with other administrative communication
systems, such as risk monitoring systems and cross-department communication
systems, as well as the communications via omni-channel accesses, into one unified
platform. Since administrative service platforms established upon singular
communication channels will lead to redundancies of administrative resources
allocated and inefficiency in the relevant department’s handling the matter promptly,
this interconnectivity substantially adds to the hotlines’ operational values; and
 Multiple-Channel Feedback Collection. To match with citizen’s diverse
communication habits, our unified communication technologies also enable
feedback collection requests to be transmitted via multiple communication channels
integrated, including WeChat, text messages and emails according to customized
notification strategies. This multiple-channel deliverability closes up the cycle of
administrative services in a cost-efficient fashion. Take our solution deployed in
Zibo, Shandong as an example, the efficiency for reaching out to callees increased
by tens of times and the administrative service completion rate exceeded 80%, while
the implementation cost reduced by more than 85% compared with the solutions
previously used therein.
Besides our core conversational AI and unified communication technologies, our product
engine technologies facilitate the operation of such “12345” hotlines primarily by realizing (i)
the management and allocation of hotline resources; (ii) the formulation of service procedures
involved; and (iii) the workflow management in relation to different governmental functions
such as administrative management, citizen services and emergency response, and the
automatic call transfer thereto in accordance with the requests identified.
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Finally, the insights generated from the whole communication process can be
systematically processed, quantitatively analyzed and visualized via interfaces to provide city
administrators with a better understanding of the efficiency, trends, recurring and newly
emergent issues with respect to their city governance and services, which can also be used as
a compelling source for evaluating departments’ work performance. The following graphic is
a screenshot of the interface monitoring the operations of the “12345” hotline offered in a
certain locality and displaying a wide array of findings intelligently analyzed, as could be
observed real-time by the decision makers of various departments of the local government:
12
43
5
6
Notes:
(1) Basic information, including the theme of the interface, access date and time
(2) Overall summary, including total amount of citizen requests accepted and closed per day/week/month, amount
of requests by subject matter and league table among units by performance score of the previous month
(3) Whole-process information of each event category, including the event type, subject matter, date of occurrence,
place of occurrence and current status
(4) Visualized analysis of citizen requests in the whole area
(5) Early warnings and anomaly alerts based on intelligent analysis of key events
(6) Grouped monitoring information and administration advice based on intelligent analysis
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Case Study 3: Visualized Conversational AI Fire Police Hotline Solutions
Our technologies have also been used in visualized fire police hotline solutions that have
upgraded traditional firefighting process. During our cooperation with a fire center in
Shandong, our core conversational AI technologies enabled intelligent generation of the fire
report and our unified communication technologies realized the transmission of video signals
concerning the view of real-time fire scene. With the support of such intelligently generated
fire report and visual information, the main purpose of our solutions was to improve the fire
reporting process and allow firefighting resources, including firefighters and fire trucks, to be
dispatched with ease and more precision, thus enabling a flexible allocation and optimization
of firefighting force. The following table sets forth the specific V oicecomm Suites applied in
and the key elements involved in our solutions:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, intelligent
softswitch, speech recognition, language
understanding, language generation,
speech synthesis, knowledge graphs,
product tools, workflow tools
software systems, maintenance services
Procedurally, when an emergency caller dialed in, the hotline operator would interact with
him/her applying our pre-formulated scripts and based upon our scenario-customized
knowledge base, after which a work ticket summarizing the fire report would be automatically
generated. See below for concrete technological steps involved in the fire reporting process
that were empowered by our core conversational AI and unified communication technologies:
 Streamlined Fire Alarm Response. The traditional fire alarm handling procedure
involves the alarm operator firstly receiving the fire alarm and confirming the planar
location and specific floor of the fire, and then notifying relevant onsite personnel.
This process would elongate the dispatch time and impact rescue efficiency. Instead,
the reporting and notification process enabled by our solutions was empowered by
our comprehensive core conversational AI technologies. Specifically, our ASR
technology automated the extraction of key words from the reporting persons on
fire-related matters in real-time, including reported location, burning substances,
fire situation (whether there was open flame, white smoke or black smoke, etc.,) and
the existence of any trapped individuals onsite. Afterwards, our NLG technology
automated the generation of fire report based upon the reported information that had
been intelligently processed. Automatically distributed to the fire police department,
such fire report substantially streamlined the fire-reporting process and improved
the disaster response efficiency; and
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 Multi-Channel Fire Scene Evaluation and Communication. Our unified
communication technological capabilities of integrating video calls allowed videos
from the emergency caller end to reach the fire center. This specifically allowed staff
handling the matter to capture the scene through transmissions of video signals, such
as smoke and firelight, and accordingly evaluate the fire level, risk level and
surrounding conditions. Moreover, urgent communication over the fire scene via
singular communication channel may be disrupted due to signal interference. To
address this uncertainty, our unified communication technologies supported
interactions through various devices (landlines, V oIP phones, etc.), ensuring that
relevant information could be timely delivered for prompt decision-making and
coordination.
Besides our core conversational AI and unified communication technologies, our product
engine technologies facilitated such fire reporting process primarily by realizing (i) the
configuration of communication procedures integrating human staffs, automatic response and
multi-media platforms; and (ii) the workflow management of the work tickets generated across
different departments such as firefighting, police and medical aid.
Based upon our aforementioned technologies, the solutions improved firefighting
performance including risk warning, prevention and control, as well as the overall response to
emergencies.
Automotive and Transportation
We have rich experiences and strong capabilities of serving automobile and logistics
companies. The number of customers to whom our solutions in automotive and transportation
had been offered during the Track Record Period increased from 52 in 2021 to 57 in 2022, and
further to 66 in 2023. Specifically, we offer solutions that are primarily used in the following
areas:
 Customer Service. We are a seasoned provider for customer service solutions for
automobile companies covering the whole process of their customer contact needs,
ranging from pre-sale consultations, product sales and marketing to customer
follow-ups. Depending upon the automobile companies’ specific requirements on
the functionalities of their customer service platforms, our solutions allow the needs
of their customers to be analyzed and solved in a conversational AI fashion.
Similarly, we also offer customer service solutions for logistics companies, which
help respond to their customers’ needs and queries in real-time, thus standardizing
their service processes and improving their service efficiency.
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 Internet of Vehicles (IoV) Service. IoV service provides another typical automotive
and transportation application for our technologies, in which we have accumulated
service experiences for more than one decade. Our solutions enable a smart cockpit
by empowering the data transmission and interactions between vehicles and the
remote control center, and can be used in real-time emergency rescue and
maintenance services, etc. Moreover, our solutions also support the collection and
transmission of data about vehicle operations and traffic conditions generated from
various smart in-vehicle and roadside traffic control devices, as well as the
intelligent analysis of the same, thereby facilitating the intelligent scheduling of
vehicle resources and route navigation. In short, our IoV service realizes data
interconnectivity and intelligent in-cabin interactions with respect to manned
vehicles.
 Vehicle-to-Everything (V2X). In addition to the above manned vehicles-related
application, we have also penetrated into the emerging V2X scenario, a major
technological path to realize autonomous vehicles. Specifically, our technologies
facilitate the conversational AI-empowered sharing of information between ICVs
and surroundings, such as other vehicles, road infrastructure and control center, etc.,
for better situational analysis and collaborative decision-making of ICV operation
and routing according to real-time information, thus realizing such V2X autonomous
driving. Through such technological steps, our solutions perform the crucial role
resembling that of traffic police in traditional transportation systems and ensure
smooth operations of ICVs in the newly emergent intelligent transportation systems.
We are one of the earliest enterprise-level solution providers that have penetrated
into city-level autonomous driving, according to the iResearch Report, which
affords us significant first-mover advantages compared with other new market
entrants in commercialization of the area. For details of our exemplary ICV project
in Zibo, Shandong, see “– Case Study – Case Study 2: ICV Project in Zibo” in this
section.
Case Study
Case Study 1: Multinational Intelligent Customer Service Centers
Automobile and logistics companies having international operations typically need to
establish multinational customer service centers to handle customer feedback, inquiries and
consultation, and other requests from the operation sites of overseas countries. The
multinational nature imposes much more demanding requirements on the solution providers
with respect to their unified communication technological capabilities of integrating
telecommunications services, hardware devices and different communication protocols in a
cross-country fashion. Moreover, the establishment of such multinational customer service
centers necessitates the technological capability of integrating customer service centers of
different countries to realize the efficient allocation of multinational agent seat resources.
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We accordingly offered solutions assisting certain automobile and logistics companies in
establishing their multinational intelligent customer service centers, which were globally
well-connected. In addition to our unified communication technologies that ensured the
integration of calls made from various countries, our core conversational AI technologies
empowered the operation of such customer service centers by enabling speech-based
interactions based upon different foreign languages catering to the multinational nature of such
centers. The following table sets forth the specific V oicecomm Suites applied in and the key
elements involved in our solutions:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, intelligent
softswitch, speech recognition, language
understanding, language generation,
speech synthesis, product tools,
workflow tools
software systems, maintenance and server
hosting services
See below for concrete technological steps involved in the operation of such multinational
intelligent customer service centers that were empowered by our unified communication, core
conversational AI and general AI technologies:
 Transnational Signal Transmission. As communication signals in different
countries or regions may be transmitted based upon different protocols, the
technologies of a solution provider serving such multinational customer service
centers have to be compatible with different protocols and communication methods.
In this regard, our unified communication technologies support the three major
international CTI protocols, i.e., TAPI, TSAPI and CSTA, and the three major types
of signal communication methods, i.e., analog transmission, digital transmission and
SIP-based communications, which made the centers’ multinational operation
possible;
 Recognition of Foreign Language. Operating customer service centers across
multiple countries introduces language diversity challenges, as many regions have
relatively lower-usage native languages that pose difficulties for accurate speech
recognition. Our ASR technology overcame this technological challenge based upon
our mature models developed for frequently spoken languages with ample data
samples and transfer learning conducted upon less spoken languages. Specifically,
it realized the automatic recognition of different less spoken languages, including
Vietnamese and Thai, and was able to maintain satisfactory accuracy rates for
recognizing such foreign languages. This allowed us to realize seamless voice
interactions based upon languages spanning customer service centers in different
counties, where the calling customers could speak naturally and comfortably
without friction caused by recognition errors. Compared with customer service
centers enabled by any single language, our solutions could drive higher customer
satisfaction due to the removal of language barriers; and
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 Allocation of Agent Seat Resource. In addition to our unified communications and
core conversational AI technologies, our general AI technologies could realize the
intelligent routing of incoming calls to available agent seats. Multinational customer
service centers regularly handle complex and diverse customer issues, which can
particularly encounter uneven distribution of agent seat resources, resulting in
excessive waiting time and eventually agent seat overload. Accordingly, the
automatic call distribution system enabled by our AI algorithms helped a well-
known Chinese automobile giant realize the intelligent allocation of agent seat
resources: when the incoming calls in a certain country were overloaded, then calls
received therein would be transferred to another country’s server system with
available agent seat resources, thus successfully avoiding excessive queuing,
reducing average caller waiting time, and improving the callers’ overall experiences.
Besides, our product engine technologies facilitated the operation of such multinational
intelligent customer service centers primarily by realizing (i) the configuration of IVR systems
that could lead the calling customers towards the specific service matters, such as shipment
tracking and complaints; and (ii) the establishment of a complete set of ticketing management
tools ranging from registration, transfer, processing and resolution that were multinationally
standardized.
On top of our technologies, we designed a number of monitoring interfaces visualizing a
wide array of metrics, including statistics on agent seats and calls received/made, so that the
companies could have a comprehensive understanding of the overall service performance of
customer service centers. A latest screenshot of one of such interfaces for a reputed logistics
company is set forth in the following graphic:











Notes:
(1) Basic information, including access date and time, and manager account
(2) Overview of call-answering statistics of the past seven days
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(3) Real-time monitoring panel of agent seat status
(4) Average-statistics analysis of agent seats of the day, including conversation length, amount of calls answered,
and duration of unready status
(5) Panel visualizing real-time data of the day, including total amount of calls received and cases of call overflows,
as well as statistical charts displaying amount of calls received, amount of calls answered, and call-answering
rate by each hour
(6) Panel monitoring agent seats in a real-time manner, displaying agent seat average workload and total amount
of agent seats
(7) Visualized report of call-answering rate, survey acceptance rate, and customer satisfaction rate
Case Study 2: ICV Project in Zibo
Starting from 2022, we have participated in the ICV project in Zibo, Shandong, a national
pilot city for synergetic development of smart city infrastructure and ICVs (̹ਿᓾ
̹). The project was launched in a local mountains park
with driveways characterized by plenty of sharp bends, steep slopes and narrow roads. Due to
the complex topographical conditions, the mountain driveways were designed in a complicated
manner that combined both two-way and one-way traffics. Moreover, ICVs operated on such
driveways included both high-speed sightseeing vehicles and low-speed vehicles playing
various maintenance roles including road cleaning. All of the above factors had to be taken
account for the intelligent scheduling of ICVs, in addition to the real-time tourist amounts,
traffic conditions and levels of congestions, which thus imposed fairly highly technological
requirements on the overall V2X autonomous driving solutions.
As such, the main purpose of our participation in the project was to support various
technological processes involved in ICVs to enable their stable and efficient operations.
Specifically, our core conversational AI technologies realized the speech-based scheduling of
ICVs through empowering interactions between passengers and ICVs and between the
cloud-based control center and ICVs, and our unified communication technologies facilitated
the transmission of multimodal data between ICVs, roadside units and the cloud-based control
center. The following table sets forth the specific V oicecomm Suites applied in and the key
elements involved in our solution for the project:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, intelligent
softswitch, speech recognition, language
understanding, language generation,
speech synthesis, knowledge graphs,
product tools, workflow tools
software systems, hardware components
(ICVs, sensors, electronic, computing
and networking devices, power piles,
cables, roadside units, displays and
accessories, etc.), maintenance, training,
classified protection and testing services
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Firstly, based upon the vehicles’ performance ability and the actual topographical
conditions, our technologies enabled the intelligent scheduling of ICVs from multiple aspects,
ensuring that they followed the optimal routes intelligently planned to effectively avoid
congestions, road hazards and on-going constructions, including:
 Vehicle-to-Network (V2N) and Infrastructure-to-Network (I2N) Coordination.
Our unified communication technological capabilities enabled the high-speed
transmission of a variety of signals including images, videos, voices and texts
generated from on-board units, as well as the roadside units arranged by us, to the
cloud-based control center, and also the transmission of cloud-based messages and
signals from such control center back to on-board units, roadside units and
intelligent stations. Our unified communication technological capabilities were
crucial to the successful operation of ICVs, given that traditional communications
technology supporting data transmission in singular medium form is not sufficient
for high-speed transmission of multimodal data required in ICV-related scenarios;
 Intelligent Scheduling of ICVs. Our comprehensive core conversational AI
technologies empowered the intelligent scheduling of ICVs primarily by enabling
the intelligent speech interactions between ICVs and passengers. Specifically, our
ASR technology could transcribe passengers’ vocal commands and questions into
texts for processing, and our NLP technology could then interpret the intent and
extract salient details. Using this insight, in-vehicle functions would be accordingly
executed. For instance, the technology allowed ICVs to conveniently respond to and
follow passengers’ voice instructions to pull over. With respect to complex requests,
they would be routed to the control center for handling, and our ASR technology’s
capabilities of recognizing Zibo dialect facilitated agent seats’ understanding local
passenger’s vocal commands. Additionally, our TTS technology allowed the control
center to provide natural speech responses or instructions to ICVs in case where
in-cabin collaboration was needed. Besides, our ASR and NLU technologies also
enabled thorough quality assessment and assurance on the service processes of the
control center, so that it could rigorously perform its control function for safety
purpose;
 Route Optimization. In addition to our core conversational AI technologies, our
general AI algorithms could analyze massive amounts of real-time traffic data and
information to automatically generate optimized routes for ICVs, which ensured
their safety when operated in the said complex topographical conditions; and
 Integration of External Devices. Besides our AI technologies, we also provided
neighboring parks, shopping malls and businesses with access to the ICV
management system through APIs based upon our unified communication
technological capabilities, which allowed integration of external devices into the
system, thus facilitating the formation of an interconnective and dynamic V2X
ecosystem. For instance, external devices would be allowed to send ride requests,
and signals would accordingly be sent to nearby vehicles to come to the requesting
location.
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Secondly, our core conversational AI technologies such as ASR, emotion recognition and
NLU also enabled passenger-ICV interactions within the smart cockpit, allowing, for instance,
ICVs to respond to and follow passengers’ speech instructions to pull over. Such technologies
even support recognition and understanding of Zibo dialect, which enriched ICVs’
functionalities and the intelligent level of the whole autonomous driving system.
Besides, after the relevant information were collected and processed, the management-
side interface tools enabled by our product engine technologies that we provided could allow
detailed analysis of ICVs’ operations through visualized roadmaps, as well as the remote
configuration of stations and routes and management of various on-board and roadside devices.
A latest screenshot of such an interface is set forth in the following graphic:







Notes:
(1) Basic column entrances, including smart intersections, unmanned shuttle buses and unmanned retail vehicles
(2) Basic information panel, including coverage area, smart road coverage, 5G network coverage and length of
pilot route
(3) Intelligent roadside units management panel to remotely manage various roadside units
(4) Data monitoring panel, allowing real-time monitoring of mileage, operating duration and number of failures
(5) Detailed analysis of ICVs’ operation status in the form of 3D visual maps
(6) ICV operation information panel, which realizes real-time monitoring of different models of ICVs, including
number of ICVs in operation and operation duration, and allows comprehensive management of the same
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As of the Latest Practicable Date, while the project was still ongoing and pending further
implementation, our technologies had already successfully piloted 19 ICVs’ operation on an
over 20-kilometer route. Upon its completion, it is expected that the project will be expanded
from the project zone into the whole municipal area in the future to empower more than 600
ICVs and provide intelligent transportation services for more than three million citizens. Since
the exchange and transmission of information from equipment and software of various sources
had to interact through the technological capabilities that we provided, we hence acted as the
general contractor for the project. Through such projects we have strengthened our
collaborations with our industrial partners in jointly serving the evolving business needs in the
autonomous driving areas. As a number of other cities are also expected to introduce similar
projects to their transportation systems in the near future given various favorable governmental
policies encouraging pilot implementation of intelligent transportation schemes, we will
attempt to further penetrate into V2X-related scenarios and grow our customer base in
automotive and transportation. For instance, leveraging our success in the project in Zibo, we
have newly participated in the establishment of a comprehensive V2X autonomous driving
system located at the Mianyang Science & Technology City New Area, an open urban space.
Through empowerment of the cloud-based control platform, among others, our technologies
have been similarly facilitating ICVs capable of V2X-based autonomous operations, including
real-time route planning and intelligent vehicle following, lane changing, vehicle avoidance
and stop. As of December 31, 2023, our technologies had empowered one driverless bus and
one driverless grocery truck operated across five stations within the Mianyang Science &
Technology City New Area.
Telecommunications
We empower telecommunications companies through unified communications and
AI-based empowerment of the communication tools and other value-added services that they
offer to enterprises based on their cloud and network services as well as various other
telecommunication resources. Delivered to telecommunications companies, our solutions allow
various communication and management needs of the enterprises that have procured such
communication tools and value-added services to be intelligently satisfied, while substantially
lowering deployment and maintenance costs. Besides, by synergizing such telecommunications
companies’ services with our technologies to jointly serve their users, we are also able to
expand the commercialization of our solutions. The number of customers to whom our
solutions in telecommunications industry had been offered during the Track Record Period
increased from 24 in 2021 to 28 in 2022, and further to 31 in 2023.
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Case Study
Case Study 1: Cloud-Based Phone System Solutions
Enterprises’ traditional communication and collaboration solutions involve a number of
complications, including high initial deployment costs on switches and communication
terminals, etc., a limited number of communication terminals enabled due to the switching
capacity of switches deployed, additional working space occupied and costs on maintenance
personnel, restricted forms of information transmitted via limited types of communication
terminals, as well as the fact that employees will have to switch numbers when using mobile
devices. Moreover, for large groups with wide geographical coverage, their decentralized
communication and collaboration solutions usually suffer from fragmented deployment and
ineffective management. We have thus delivered directly or indirectly to major
telecommunications companies in China cloud-based internet phone system solutions mainly
for the purpose of integrating multimodal information and various communication terminals
for them to facilitate enterprises’ communication needs. Realized primarily through our unified
communication technologies, the solutions are added with value-added functions based upon
our core conversational AI technologies and collaboration solutions that improve enterprises’
work and communication efficiency. Such solutions’ emphasis on information infrastructure
and data protection ensures the security environment of the cloud hosted thereby while not
compromising the cost-effective advantages of such solutions. The following table sets forth
the specific V oicecomm Suites applied in and the key elements involved in our solutions:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, intelligent
softswitch, speech recognition, language
understanding, language generation,
speech synthesis, product tools
software systems, maintenance services
The solutions have multiple advantages over traditional solutions. Being able to be easily
deployed in multiple localities and on multiple devices, our cloud-based phone system
solutions not only save users from investing heavily at the upfront for their communication
equipment, but also necessitate no additional working space or maintenance personnel. See
below for concrete examples of our unified communication technologies empowering the
functionalities of such cloud-based phone systems:
 Scalability of Communication Resources. Our unified communication
technological capabilities allow unlimited extensions of amount of terminals
without additional installment or implementation costs incurred for users, thus
satisfying enterprises’ scalable communication demand; and
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 Integration of Multimodal Information and Devices. Our unified communication
technological capabilities also can realize the transmission of multimodal
information (voices, videos and images, etc.) through multiple types of
communication terminals including mobile phone, landlines and V oIP phones, and
allow convenient interconnection with various applications on mobile phones and
computers. Through straightforward and flexible allocation of phone number
resources and tying the same to employees’ mobile devices, each individual is able
to be contacted easily both externally and internally and via different devices.
See below for the conversational AI empowerment of such cloud-based phone systems
that further makes our solutions attractive:
 Interactive Voice Response. If an employee is occupied and unable to immediately
address upcoming calls, he or she can activate the automated interactive voice
response system enabled by our core conversational AI technologies. Specifically,
our NLP technology helps understanding the caller’s intent and, in combination with
our TTS technology, navigates the caller through the menus and provides relevant
responses through natural language. As such, this self-service functionality acts as
a versatile tool to handle inbound calls and alleviates employees from repetitive,
low-complexity calls when their availability is limited; and
 Speech-Based Call Initiation. Our ASR technology also enables employees to
initiate calls hands-free by delivering voice instructions, which makes manual
initiation that is time-consuming and cumbersome in enterprise-level settings
unnecessary.
In addition to our unified communication and core conversational AI technologies, our
product engine technologies facilitate the operation of such cloud-based phone systems
primarily by realizing the configuration of communication procedures including automatic
response and escalation to human interactions to further improve the deploying enterprises’
communication efficiency.
Case Study 2: Intelligent Electronic Work Badge Solutions
A variety of enterprises face the common difficulty in effectively managing their
employees (especially onsite employees involving in sales and marketing services, etc.) in
relation to employment-related activities, and suffer from a lack of knowledge of their
real-time performance. In contrast to agent seat personnel the quality assurance and assessment
on whose services could be conducted relatively easily, enterprises’ supervision and inspection
on such employees oftentimes result in below-expectation outcomes due to limited inspection
intervals and personnel coverage, notwithstanding the fact that they may have incurred
substantial costs thereon, thus causing untimeliness and inefficiency in employee performance
assessment, evaluation and improvement. Accordingly, we deliver directly or indirectly to
telecommunications companies solutions where our core conversational AI technologies are
bundled onto smart devices as compact and light intelligent work badges, mainly for the
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purpose of increasing visibility of employment-related activities and facilitating the
standardized management of employees while helping users streamline monitoring costs in a
conversational AI empowered manner. In addition, our unified communication technologies
support the transmission of relevant information collected, such as voices and texts, to the
backend for statistics and analysis purposes. The following table sets forth the specific
V oicecomm Suites applied in and the key elements involved in our solutions:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, intelligent
softswitch, speech recognition, emotion
recognition, language understanding,
product tools, workflow tools,
knowledge graphs
software systems, maintenance services
In addition to their basic functions such as helping with documentation of customer basic
information and sending task reminders, such intelligent work badges are empowered by our
conversational AI technologies for users to effectively monitor the work performance of
employees wearing them. See below for concrete examples of our core conversational AI
technologies empowering the functionalities of such intelligent work badges:
 Speaker Identification. With our voiceprint recognition technology which
accurately separates and extracts audio sources and ensures oriented collection,
users can realize through the intelligent work badges audio recording of work-
related activities in designated working areas with respect to employees who have
signed to consent to wearing such badges. This application ensures that voices of the
persons with whom an employee carrying the badge is interacting will not be
wrongfully recorded; and
 Performance Supervision. Afterwards, our ASR technology can accurately
transform such recordings into texts, the service quality indicated thereby is then
completely and automatically assessed based upon our NLU and emotion
recognition technologies against the pre-designed protocols on triggering
expressions suggesting employment misconduct, underperformance or omission.
The said technologies overcome enterprises’ difficulties in tracking their
employees’ work-related verbal interactions in real-time, and provide additional
insights for them to comprehensively assess and manage their employees’ work
quality, especially with respect to those who are constantly on-the-go outside the
office. By capturing critical verbal exchanges, the application of our conversational
AI technologies thus delivers transparency into remote employees’ actions.
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Further, our unified communication technologies enable the transmission of the
recordings and transcripts to the backend. Additionally realized by our product engine
technologies, our solutions provide visualizable employee performance reports illustrating the
employees’ performance level in each dimension including proactiveness, fluency, accuracy
and compliance in their interactions with customers, and also intelligently suggesting
improvements to be made, through interfaces. The following graphic is a screenshot of an
interface displaying the quality assurance outcomes enabled by the intelligent work badges in
a number of metrics including the overall distribution of the scores and specific protocols
triggered, thereby allowing users to have a straightforward and holistic view of the service
quality and major issues discovered with respect to their employees wearing such intelligent
work badges:
2
3
1
8
5
76
4
Notes:
(1) Basic information, displaying the theme of the interface
(2) Integrated intelligent work badge management panel, including functions such as badge-enabled quality
assessment and assurance, quality assessment and assurance settings, and systems settings
(3) Statistical cycle management panel, allowing managers to freely select the statistical cycle based upon the
intelligent work badges deployed
(4) AI-enabled quality assessment statistics, providing information such as total volume conducted, qualification
results and early warnings, and automatically generating assessment scores
(5) Human-based re-assessment statistics, if any, which can be compared by managers with the AI-enabled quality
assessment results
(6) Display of the average score of AI-enabled quality assessment/human-based re-assessment
(7) Top five protocols triggered per analyzed
(8) Visualized statistical report of conversation durations
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Finance
Leveraging our technologies, we also provide financial service-related solutions to
financial institutions, primarily in telephone banking, for purposes such as telephone
transactions, marketing, identification, and customer notification and consultation, thereby
upgrading their customer services and promoting the comprehensive intelligent transformation
of the finance industry. Additionally, we also offer solutions in service training that facilitate
financial institutions’ internal processes. The number of customers to whom our solutions in
finance industry had been offered during the Track Record Period increased from 14 in 2021
to 34 in 2022, and further to 35 in 2023.
Case Study
Case Study 1: Intelligent Virtual Agent Solutions for Banks
Banks have always been at the forefront of endeavoring to provide exceptional customer
services. Keeping up with the increasing demand of their customers, banks are oftentimes faced
by substantial costs associated with operating and maintaining their customer service
platforms, as well as varied quality of the services provided by their human agent seats due to
substantial service pressures. Such factors may lead to a substandard customer experience,
which could potentially damage their reputation and negatively impact their business. For
purposes of overcoming these issues, we offer solutions based upon our core conversational AI
technologies that feature intelligent virtual agents capable of intelligent conversational
interactions with the callers/callees and leading them through the procedures. As part of our
total solution offering, our unified communication technologies also realize the seamless
switch to human agent seats for complex issues. The following table sets forth the specific
V oicecomm Suites applied in and the key elements involved in our solutions:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, intelligent
softswitch, speech recognition, emotion
recognition, language understanding,
language generation, speech synthesis,
knowledge graphs, product tools,
workflow tools
software systems, maintenance services
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See below for concrete technological steps involved in the service process of such
intelligent virtual agents that can be empowered by our core conversational AI and unified
communication technologies:
 Voice Interactions. Our comprehensive core conversational AI technologies enable
the intelligent virtual agents to intelligently fulfill various functions in relation to
telephone banking, such as queries, transaction instructions, marketing,
identification and customer complaints. Specifically, our ASR technology
transcribes customer queries from phone conversations to texts for processing, and
our NLP technology comprehends these queries and extracts key details for
responses. Empowered by these technologies, the intelligent virtual agents can
automatically parse and process customers’ voice or text inquiries, and provide
quick response. These applications improve the efficiency of banks’ customer
service, since otherwise human agent sets would have to suffer from laboriously
handling customers’ specific needs, such as on account balances, funds transfer,
transaction lookups and card services, etc. In situations where outbound
communication is needed for purposes like payment reminders, our TTS technology
allows intelligent virtual agents to automatically reaching out to customers
conversationally over phone;
 Sentiment Detection. Moreover, our emotion recognition technology embedded
ensures an accurate detection and understanding of the callers/callees’ emotions by
analyzing their voices, therefore providing them with contextualized responses and
leading to a more thoughtful service process; and
 Escalation to Human Agent. In addition to our core conversational AI
technologies, our unified communication technologies enable transferring calls
smoothly to human agent seats in situations where the customers require additional
assistance. Such human agent seats will in turn interact therewith based upon the
pre-incorporated knowledge base, freely formulated scripts and seamlessly
integrated backend operating systems. This transferability ensures that banks’ can
optimize their institutional resources to the extent possible, while not compromising
their dedication to providing meticulous and in-human customer service.
In addition to our core conversational AI and unified communication technologies, our
product engine technologies further enhance the functionalities of such intelligent virtual
agents primarily by realizing (i) the configuration of service procedures applicable to specific
service matters, such as bank account application, reporting loss of cards and balance check;
and (ii) the establishment of a complete ticketing management platform that integrates the
information collected from the intelligent virtual agents with the backend operating systems.
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Case Study 2: Intelligent Employment Training Systems
When training prospective employees including agent seats for customer services, banks
and other institutions are faced with the necessity for investing a great deal of expenditures due
to the complicatedness of operating or services procedures related to financial institutions.
Additionally, the difficulty in comprehensively covering massive training contents within
limited time and the inability to view training results and issues in a clear and concise way
usually compromise the training efficiency. For purposes of solving the issue, we have offered
a number of banks intelligent employment training systems where intelligent virtual trainers
empowered by our comprehensive core conversational AI technologies can automatically
conduct the training process by interacting with the trainees, and evaluate their training
performance. Upon completion of the training sessions, our unified communication
technologies also enable the transmission of relevant audio and text data for analysis purposes.
The following table sets forth the specific V oicecomm Suites applied in and the key elements
involved in our solutions:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, intelligent
softswitch, speech recognition, emotion
recognition, language understanding,
language generation, speech synthesis,
product tools, workflow tools
software systems, maintenance services
The intelligent employment training systems based upon our core conversational AI
technologies can vividly simulate a variety of practical question-and-answer scenarios
covering operational procedures, customer inquiries and enterprise value, where the trainees
interact with the intelligent virtual trainers in a low-latency, noise-resistant manner.
Specifically, during such interactions, our constantly optimizing ASR technology enables
real-time recognition of the trainees’ verbal responses with an accuracy rate up to 98%, so that
they are able to go through a large deal of training materials per session and the training
efficiency is improved. Our NLU technology enables deep semantic analysis of multiple rounds
of conversations, which makes the training process substantive and interactive. To solve the
issues with normal employee trainings carried out manually that tend to be monotonous and
unengaging, which can easily lead to fatigue and loss of attention, our TTS technology helps
generate diversified human-like timbres. This makes the whole training process livelier and
more interestingly. Through converting text materials into diverse voice-based training
contents, the application allows the trainees to learn in a relaxed and pleasant state, thus
providing efficient training for the trainees to improve their adaptability to various business
scenarios and performance level. Equipped with our solutions, the trainees can also conduct
multiple rounds of simulation tests on a daily basis on the systems that we provide to reinforce
their understanding of the training contents.
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Upon completion of the training sessions, our unified communication technological
capabilities support the automatic integration of the training recordings and transcripts, as well
as the training process that the intelligent virtual trainers lead the trainees through, onto a
visualized interface.
Enabled by our product engine technologies, the systems that we provide allow
convenient formulation and adjustment of training procedures in a node-dragging manner
according to the nature of the specific skills to be trained. Moreover, the training grade of each
trainee could be intelligently generated based upon pre-determined grading mechanisms, such
as adherence to scripts or procedures, emotional fluctuations, usage of keywords within the
white/blacklist, and occurrences of non-mitigable errors with respect to customer service
personnel, allowing the training managers to have a better idea of the training results while
substantially saving training costs. At the same time, the trainees can also clearly view the
training results which analyze and present their competencies and deficiencies. The following
graphic is a screenshot of the aforementioned backend interface realizing straightforward
review of the training process and convenient configuration of the same for the training
managers, in addition to a number of other management functions:
2
1
43
5
Notes:
(1) Basic information, displaying manager account
(2) Different selectable panels, allowing management of each aspect of training systems
(3) The panel currently selected to be displayed, which can be freely switched
(4) Main panel displaying the visualized map of the whole training process for question-and-answer scenarios,
which allows training managers to review the training contents went through by trainees at each node, as well
as to formulate the training procedures, etc.
(5) Node-selection buttons, enabling training managers to configure nodes for the training process by specific
functions
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Other Industries
In addition to offering enterprise-level solutions in the aforementioned four key
end-customer industries that we focus on and have accumulated rich industry know-how,
engineering experiences and customer insights, we have been expanding the presence of our
solutions into other industries such as the media, healthcare, E-commerce and retailing, etc.,
with common demand that can increasingly be empowered by conversational AI. For instance,
based upon intelligent virtual agents powered by our technologies, we offer intelligent
speech-based customer service solutions to media operators, medical device sellers and service
providers, E-commerce platforms and consumer goods companies to facilitate their marketing
and customer communication activities.
Case Study
Consumer goods companies facing stiffer competition nowadays increasingly adopt
intelligent customer service platforms to establish loyalty programs that are able to cope with
rising expectations by consumers engaging across different channels, such as apps and
websites, on seamless digital experiences and on-demand support, as well as seasonal spikes
in inquiries. We accordingly offered conversational AI-empowered membership management
and service platform solutions to a globally leading beer giant that operates more than 200 beer
brands. As one of the largest beer manufacturers and sellers in the world with complex retailing
and marketing networks in China, the company regularly handles a vast volume of individual
member interactions in China. Our solutions accordingly served its purpose of more efficiently
engaging with its members, building loyalties and driving beer sales, while delivering
top-notch services. Specifically, our core conversational AI technologies enabled interactions
between intelligent virtual agents and the members, and our unified communication
technologies realized the interfacing of multiple mobile user interfaces and applications with
the platform. The following table sets forth the specific V oicecomm Suites applied in and the
key elements involved in our solutions:
Voicecomm Suites Key Solutions-Involved Elements
multi-media gateways, emotion
recognition, language understanding,
language generation, knowledge graphs,
product tools, workflow tools
software systems, maintenance services
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See below for concrete technological steps involved in the operation of the membership
management and service platform that can be empowered by of our core conversational AI and
unified communication technologies:
 Member Interaction. The intelligent virtual agents based upon our core
conversational AI technologies embedded in the campaign management system
assisted the company in delivering enhanced member engagement and services
through intelligent interactions. Specifically, our NLU technology could understand
members’ textual requests and our NLG technology provided relevant answers or
recommendations by referencing integrated data sources on order histories, loyalty
points, product catalogs, among others. These applications thus fulfill membership
management capabilities such as order inquiries, promotional activities and after-
sale complaints. The self-learning abilities also allow the intelligent virtual agents
to improve over time based on real conversations. The knowledge graphs tailored to
the nature of the company’s business that we integrated into the campaign
management system helped human agent seats (to whom complex issues would be
escalated seamlessly by the intelligent virtual agents) to handle a broad range of
natural language queries. The query system based upon such knowledge graphs
could be used to deeply analyze members’ actual intent, and accordingly revert
detailed results in response to their questions. Functioning coordinately, our above
technologies not only optimized costs for the company by automating common
requests but also delivered consistent and scalable member services; and
 Data Integration. Our unified communication technological capabilities allowed
omni-channel access for members via a number of mobile user interfaces and
applications of the company, as well as full integration of data through various other
E-commerce platform-based membership systems. Such unification of multiple
channels further drove member traffic and enhanced vibrancy of each system, where
our unified communication technologies ensured that membership points and loyalty
were accurately exchanged and accumulated.
In addition to our core conversational AI and unified communication technologies, our
product engine technologies facilitated the operation of such membership management and
service platform primarily by realizing (i) the configuration of communication procedures
involving the intelligent virtual agents and human agent seats; and (ii) the workflow
management of the work tickets generated across different departments to address members’
various requests.
Like our solutions offered in other end-customer industries, we also provided intuitive
interfaces for the company that could suggest a variety of actionable insights, including
conversation volume, satisfaction rate, average turn of Q&As, average conversation length, and
virtual-to-human escalation rate, etc. Our solutions thus unlocked the power of conversational
AI on strengthening membership relationships for the company by enabling it to automate
common member requests and scaling up membership service in a fast yet standardized way.
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Others
During the Track Record Period, we also provided services for various subsidiaries of
major telecommunications companies in China, which primarily included promoting its
telecommunications terminals and other telecommunications resources and services by, among
others, leveraging our conversational AI technologies that could assist the purchasers to realize
a number of intelligent speech functions on their devices. For details of such a
telecommunications company that also acted as our largest supplier in each year of the Track
Record Period, see “– Suppliers and Procurement – Top Suppliers” in this section. We explored
such business line with an aim to broaden our collaboration scope with the said
telecommunications company, strength our commercial relationships therewith and solidify
mutual cooperation in conversational AI-related scenarios. The salient terms and conditions of
our agreements relating to such promotion services are set out below:
Service scope We typically provide promotion services to facilitate the sales of
telecommunications terminals and other telecommunications
resources and services offered by our customers.
Pricing Our customers will pay us channel marketing service fees based on
our promotional performance.
Payment Our customers shall pay the channel marketing service fees to us
after our issuance of invoice.
Termination Besides natural expiration upon the contractual term or by mutual
consent, the agreement may also be terminated by our prior
notification subject to contractual time restrictions or by either
party due to the other’s uncured breaches.
Confidentiality Each party shall maintain confidentiality of information obtained
in relation to the relevant agreement and not disclose to any third
parties, which shall supersede the expiration or termination of the
agreement.
Since we started to provide such promotion services in 2021, our revenue generated
therefrom increased from RMB3.1 million in 2021 to RMB23.4 million in 2022, which was in
line with our increased resources and efforts directed towards providing such promotion
services at an initial stage. As our business is centered upon offering enterprise-level solutions,
we consider providing such services as utilizable business opportunities to explore into other
areas that could be empowered by our conversational AI technologies as well as tighten our
relationships with major enterprise-level conversational AI participants. Going forward, we
expect to flexibly adjust our engagement in such promotion services in a way that both
addresses our customers’ needs, commensurate with our strategic plan of overall business
resources and further vitalizes a conversational AI ecosystem with such customers as important
participants.
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OUR REVENUE MODEL
During the Track Record Period, we generated our revenue on a project basis mainly from
offering enterprise-level solutions enabled primarily by our technologies on unified
communications and AI to our customers. Depending upon specific users’ concrete needs, the
extent to which a certain solution involves each category of technologies may vary. During the
Track Record Period, core conversational AI technologies had been applied in most of our
existing projects, and we also elected to offer solutions to customers currently only demanding
the realization of unified communications with a goal to further upsell core conversational AI
technologies. To the best knowledge of our Directors, our projects that applied core
conversational AI technologies contributed to approximately 89%, 89% and 92% of our
revenue generated from offering enterprise-level solutions in 2021, 2022 and 2023,
respectively. As the record of core conversational AI technologies being discretionarily applied
after implementation is documented within the enterprise-level users’ own systems, historical
data regarding the frequency at which such technologies were applied in the relevant projects
are unavailable from our end and inherently contingent upon the conversation volumes
involved, which can vary significantly across diverse scenarios of different end-customer
industries. For instance, a high-traffic customer service application in the finance industry may
experience substantially higher usage frequencies compared to a specialized application in fire
police hotlines.
We have recently piloted our conversational AI “12345” hotline solutions in certain cities
so as to enhance the service quality and enable sufficient interconnectivity of local “12345”
hotlines. In the cities where our solutions are implemented, all calls received on “12345”
hotlines are processed with our core conversational AI technologies. For more details, see “Our
Solution Offerings – V oicecomm Solutions – City Management and Administration – Case
Study – Case Study 2: Conversational AI “12345” Hotline Solutions” in this prospectus. We
have obtained the usage frequency data of our conversational AI “12345” hotline solutions
from our customers. The table below sets forth the daily call volumes processed with our
comprehensive core conversational AI technologies, ranging from ASR, NLU, NLG, TTS to
emotion recognition, to realize intelligent interaction, quality assurance and inspection and
feedback collection, among others, handled through certain “12345” hotlines recently launched
or upgraded:
City
Call Volumes
Processed with
Our Core
Conversational AI
Technologies
During a
Specific Day Date
A city in Henan Province 1,899 April 11, 2024
A city in Henan Province 4,347 April 13, 2024
A city in Shaanxi Province 3,631 April 12, 2024
A city in Yunnan Province 2,404 April 8, 2024
A city in Guizhou Province 1,894 April 12, 2024
A city in Guizhou Province 1,456 April 12, 2024
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Our continuous service of enterprise-level users and penetration into our key end-
customer industries for decades have enabled us to thoroughly understand the common demand
of such users and hence to develop and optimize V oicecomm Suites realizing solutions that
feature high level of modularization and standardization. The modularization and
standardization of our solutions ensure cost efficiency in both enterprise-level users’
deployment of our solutions and our offerings of the same. From enterprise-level users’
viewpoint, standardized V oicecomm Suites enabling our solutions essentially operate as a
menu through which they may pay only for the specific functions needed, which not only
makes the pricing transparent but also reduces their total cost of ownership as well as operation
and maintenance costs. Besides, the modularization and standardization of our solutions also
allow us to readily replicate and adjust our solution offerings in similar application scenarios,
therefore shortening the development and implementation cycle and contributing to our
promising profit levels once economies of scale are achieved. The following table sets forth a
breakdown of our total revenue by offering categories:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Enterprise-level
solutions 456,871 99.3 491,641 95.5 801,060 98.5
Others* 3,064 0.7 23,351 4.5 11,957 1.5
Total 459,935 100.0 514,992 100.0 813,017 100.0
Note:
* Primarily related to promoting products empowered by our conversational AI technologies for our
customers, from which we generated revenue
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The following diagram illustrates our revenue model as well as the service flow and funds
flow in relation to our solutions:
Suppliers
 Communication
devices
 Servers and
computers
 network and other
telecommunication
resources...
System
Integrators*
Enterprise-Level
Users*
 Governmental
entities
 Automobile
companies
 Telecommunication
companies
 Financial Institutions
 Other enterprises...
SSSSSSSSSSS
EEEEEEEEEEEEnEE
hardware
offerings bundling
our solutions
Enterprise-Level
Users
 Governmental
entities
 Automobile
companies
 Telecommunication
companies
 Financial Institutions
 Other enterprises...
n
g
 EEEEEEEEnEsoftware only/software
plus hardware
solutions
software only/software
plus hardware
solutions
Service flow
Funds flow
As our customers*
Specifically, our customers for our solutions during the Track Record Period included: (i)
system integrators that embedded our solutions into their offerings to enterprise-level users;
and (ii) enterprise-level users that used our solutions directly. The following table sets forth a
breakdown of our revenue generated from offering solutions by customer types, in absolute
amounts and as a percentage of total solution revenue, for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Revenue from
– System integrators 381,101 83.4 378,897 77.1 638,528 79.7
– Enterprise-Level
users 75,770 16.6 112,744 22.9 162,532 20.3
Total 456,871 100.0 491,641 100.0 801,060 100.0
The solutions that we offered during the Track Record Period consisted of: (i) software
only solutions; and (ii) software plus hardware solutions in which we integrated our software
systems with hardware devices, network and other telecommunication resources, and/or other
services (if needed), etc., procured from suppliers as part of our total solutions. The software
plus hardware solutions are usually required in order to avoid issues during the operation and
maintenance of the systems, such as difficulty in faults identification, or when a single
module’s upgrade affects the operation of other modules, etc. Customers can determine the
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specifications of the solutions to be purchased from us and the delivery method based on their
needs. The following table sets forth a breakdown of our revenue generated from offering
solutions by solutions types, in absolute amounts and as a percentage of total solution revenue,
for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Software only solutions 85,447 18.7 162,548 33.1 282,980 35.3
Software plus hardware
solutions 371,424 81.3 329,093 66.9 518,080 64.7
Total 456,871 100.0 491,641 100.0 801,060 100.0
The following table sets forth a breakdown of our gross profit generated from offering
solutions by solution types, in absolute amounts and in terms of gross profit margin for the
years indicated:
Y ear Ended December 31,
2021 2022 2023
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
RMB’000 % RMB’000 % RMB’000 %
Software only
solutions 76,467 89.5 149,468 92.0 229,996 81.3
Software and
hardware
solutions 86,661 23.3 59,707 18.1 95,134 18.4
163,128 35.7 209,175 42.5 325,130 40.6
During the Track Record Period, we generated an increasing amount of revenue from our
software only solutions, which also took up an increasing portion in our total revenue, mainly
due to that (i) it is our increasingly heightened focus to scale up offering such solutions of
higher margins in order to enhance our competitive positioning while expanding profit pools
through the maturation and accumulation of our technologies. As we establish and enhance our
market presence, we have gradually adopted the strategy that prioritizes offering software only
solutions in projects in which customers do not specifically demand software plus hardware
delivery or where there is no concrete scenario-specific benefit for doing so, provided that this
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priority would not affect our acquisition of such customers; and (ii) the continuous expansion
of our customer bases who typically purchased from us software plus hardware solutions to
firstly establish their communication platforms affords us the opportunities to up-sell software
only solutions later to further diversify and enhance their unified communications and AI
capabilities.
As certain customers may have specific demand on functionalities that are incidental to
our technologies, we from time to time externally purchased software and/or services on
developing project-specific software to enable offering total solutions on a one-stop basis
during the Track Record Period. Since we focus our business on delivering values to
enterprise-level users primarily based upon our technologies, such externally purchased
software and/or software-development services took up a limited percentage of our cost of
revenue in each year of the Track Record Period. For details, see “Financial Information –
Description of Selected Components of Consolidated Statements of Profit or Loss – Cost of
Revenue” in this prospectus. The following table sets forth a breakdown of our revenue
generated from software only solutions enabled solely by our technologies and those that
incorporated externally purchased software and/or software-development services for the years
indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Software only solutions
– Enabled solely by our
technologies 72,385 84.7 154,456 95.0 219,777 77.7
– Including externally
purchased software
and/or software-
development services 13,062 15.3 8,092 5.0 63,203 22.3
Total 85,447 100.0 162,548 100.0 282,980 100.0
Our revenue generated from software only solutions that incorporated externally
purchased software and/or software-development services fluctuated in each year of the Track
Record Period, reflecting the contingent nature of the accessory functionalities demanded the
relevant customers in each year. By contrast, our revenue generated from software only
solutions enabled solely by our technologies increased continuously during the Track Record
Period, which was consistent with the general trend of our revenue growth and also took up the
major portion of our revenue generated from software only solutions. Our revenue generated
from software only solutions enabled solely by our technologies contributed to a less
percentage of our revenue generated from software only solutions in 2023, primarily due to the
fact that we participated in certain projects that involved the purchase of functionally specific
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platforms supplementary to our technologies and accordingly generated a greater amount of
revenue during the same period. Specifically, we primarily purchased externally for certain
platforms for data analytic and management, and vehicle inspection to offer the relevant IoV
solutions, as well as that for human resource maintenance to offer the relevant intelligent
administration solutions, in each case on a one-stop basis.
During the Track Record Period, we generated our revenue primarily from providing our
solutions in a number of end-customer industries, mainly including city management and
administration, automotive and transportation, telecommunications, and finance. The following
table sets forth a breakdown of our revenue generated from offering solutions by end-customer
industries, in absolute amounts and as a percentage of total solution revenue, for the years
indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
City management and
administration 165,075 36.1 192,734 39.2 321,239 40.1
Automotive and
transportation 81,251 17.8 83,393 17.0 191,077 23.9
Telecommunications 68,385 15.0 91,782 18.7 173,976 21.7
Finance 96,051 21.0 79,745 16.2 84,530 10.5
Other industries 46,109 10.1 43,987 8.9 30,238 3.8
Total 456,871 100.0 491,641 100.0 801,060 100.0
For details of the period to period comparison of our results of operations, see “Financial
Information” in this prospectus.
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OUR PROJECT
Top Projects
The following table sets forth the particulars of our five largest projects during the Track
Record Period and up to the Latest Practicable Date that had been completed as of the same
date in terms of contract sum:
Percentage of Revenue Contribution
during the Track Record Period
Project Code Customer Project Type Solution Descriptions Duration
Contract
Sum Y ear Ended December 31,
2021 2022 2023
RMB’000 % % %
Project No. 7 Customer L* Software plus hardware
solutions in city management
and administration, including
maintenance services
Establishing Intelligent contact
centers for energy
management
Since May 2023
and completed
on November 1,
2023
60,233 – – 6.7
Project No. 1 Customer A* Software plus hardware
solutions in automotive and
transportation, including
maintenance services
IoV communication service
platform for a Shandong-
based automobile
manufacturer
Since October
2019 and
completed on
November 24,
2021
44,681 8.6 – –
Project No. 2 System integrator and
subsidiary of a Beijing-based
company providing science
and technology promotion
and application services,
including to apartment
management companies, with
a registered capital of
RMB10 million
Software plus hardware
solutions in other industries,
including maintenance
services
Intelligent online management
and mobile service platforms
for apartment management
companies
Since August
2021 and
completed on
July 31, 2022
40,531 2.9 4.4 –
Project No. 3 Customer B* Software plus hardware
solutions in
telecommunications industry,
including maintenance
services
Conversational AI-empowered
communication terminals and
relevant intelligent backend
management platform
delivered to a major
telecommunications company
for it to provide intelligent
communication services
Since December
2020 and
completed on
August 8, 2022
39,816 2.7 0.3 –
Project No. 4 Customer F* Software plus hardware
solutions in finance industry,
including maintenance
services
Intelligent customer service
platform for a Beijing-based
bank
Since September
2019 and
completed on
October 29,
2021
33,720 6.5 – –
Note:
* For details of our customers, see “– Customers and Customer Support – Top Customers” in this section.
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The following table sets forth the particulars of our five largest projects during the Track
Record Period and up to the Latest Practicable Date that had been ongoing as of the same date
in terms of contract sum:
Percentage of Revenue Contribution
during the Track Record Period
Project Code Customer Project Type Solution Descriptions Duration
Contract
Sum Y ear Ended December 31,
2021 2022 2023
RMB’000 % % %
Project No. 6 A group of local system
integrators and enterprise-
level users
(1)
Software plus hardware
solutions in city management
and administration, including
maintenance services
For details of our solutions
offered for the project, see
“– Our Solution Offerings –
V oicecomm Solutions – City
Management and
Administration – Case Study
– Case Study 1: Intelligent
Town Project in Chengdu” in
this section.
Since October
2018
N/A
(2) 26.4 24.9 16.6
Project No. 8 Customer M (3) Software plus hardware
solutions in city management
and administration, including
maintenance services
Establishing intelligent
administrative platforms for
certain governmental entities
in Shanghai
Since March 2023 46,680 – – 4.7
Project No. 10 Enterprise-level user and a
Shandong-based state-owned
company providing software
and information technology
services, including IoT-
related technologies, with a
registered capital of RMB0.1
billion
Software plus hardware
solutions in automotive and
transportation, including
maintenance services
For details of our solutions
offered for the project, see
“– Our Solution Offerings –
V oicecomm Solutions –
Automotive and
Transportation – Case Study
– Case Study 2: ICV Project
in Zibo” in this section.
Since August
2022
37,564 – – –
Project No. 18 System integrator and a
Shanghai-based company
providing computer system
integration and other
information technology
services involving
communication terminals and
software, with a registered
capital of RMB10 million
Software plus hardware
solutions in city management
and administration, including
maintenance services
Digitalization of a shopping
plaza-based business circle
in Nanjing by establishing
intelligent communication
platforms
Since June 2023 25,441 – – 1.0
Project No. 19 Customer A
(3) Software only solutions in
automotive and
transportation, including
maintenance services
Intelligent speech-based
customer service systems for
automobile companies
Since April 2023 19,805 – – –
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Notes:
(1) Our participation in the project entails the establishment of a digitalized technological infrastructure for an
intelligent town cluster where the administration, production and service activities, healthcare, security and
educations, etc., of more than 200 towns are being unified and integrated into one public service platform. The
large scale and complexity of the project hence necessitate empowering a wide array of local companies and
entities through our solutions to cover the breadth of the required domain expertise. As such, we transacted
with 14 local system integrators equipped with diverse resources and expertise during the Track Record Period
to facilitate and scale up solution deployment, in addition to enterprise-level users that use our solutions
directly, thus allowing tailored solutions for the varied needs within the intelligent town cluster in an efficient
manner per the project timeline. This approach lifts the burden of single-handedly manage delivery to each
enterprise-level user across the entire project and therefore enables us to focus on our core strengths in solution
development. According to the iResearch Report, it is market practice for a conversational AI solution provider
to transact with multiple system integrators and/or enterprise-level users in order to serve such type of
municipal level intelligent infrastructure and implement smart community projects of this magnitude. Due to
its municipally complex and extensive nature comprising hundreds of towns in contrast to our other projects
involving solutions offered to any single organization or enterprise, we derived a significant portion of revenue
from the project, which contributed 26.4%, 24.9% and 16.6% of our total revenue in 2021, 2022 and 2023,
respectively. Comparatively, the other projects we engaged during the Track Record Period were smaller in
scale. Based upon the term of the contract with the latest expiration date among the ongoing agreements that
we entered into with the said group of local system integrators and enterprise-level users as of the Latest
Practicable Date, the project is expected to be completed on November 11, 2025. For details of the risks related
thereto, see “Risk Factors – Key Risks Relating to Our Business, Industry, Regulatory Compliance, General
Operations and Financial Prospects – We derived a significant portion of revenue from our intelligent town
project in Chengdu during the Track Record Period” in this prospectus.
(2) The project involves the use of agreements in which the exact contract sum is not stated therein and we settle
with the respective customer through the actual amount of orders made by it, based on which as of the Latest
Practicable Date such project is ranked into the table above.
(3) For details of our customers, see “– Customers and Customer Support – Top Customers” in this section.
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The following tables set forth the particulars of our five largest projects in terms of revenue contribution in each year of the Track Record
Period:
For 2021
Project Code Customer Project Type Solution Descriptions Duration
Status as of
the Latest
Practicable Date
Contract
Sum
(1) Y ear Ended December 31,
2021 2022 2023
Revenue
recognized
Gross
Profit
Margin (2) Revenue
recognized
Gross
Profit
Margin (2) Revenue
recognized
Gross
Profit
Margin (2)
RMB’000 RMB’000 % RMB’000 % RMB’000 %
Project No. 6 A group of local system integrators
and enterprise-level users (3) Software plus hardware solutions in
city management and
administration, including
maintenance services
For details of our solutions offered
for the project,
see “– Our Solution Offerings –
V oicecomm Solutions – City
Management and Administration
– Case Study – Case Study 1:
Intelligent Town Project in
Chengdu” in this section.
Since October
2018
Ongoing N/A
(4) 121,415 17.3 128,489 21.8 134,793 25.5
Project No. 1 Customer A (5) Software plus hardware solutions in
automotive and transportation,
including maintenance services
IoV communication service platform
for a Shandong-based automobile
manufacturer
Since October
2019
Completed on
November 24,
2021
44,681 39,746 34.0 – – – –
Project No. 4 Customer F
(5) Software plus hardware solutions in
finance industry, including
maintenance services
Intelligent customer service
platform for a Beijing-based bank
Since
September
2019
Completed on
October 29,
2021
33,720 – – 29,956 23.9 – –
Project No. 2 System integrator and subsidiary of
a Beijing-based company
providing science and technology
promotion and application
services, including to apartment
management companies, with a
registered capital of RMB10
million
Software plus hardware solutions in
other industries, including
maintenance services
Intelligent online management and
mobile service platforms for
apartment management companies
Since August
2021
Completed on
July 31, 2022
40,531 13,443 25.1 22,509 10.8 – –
Project No. 3 Customer B
(5) Software plus hardware solutions in
telecommunications industry,
including maintenance services
Conversational AI-empowered
communication terminals and
relevant intelligent backend
management platform delivered to
a major telecommunications
company for it to provide
intelligent communication
services
Since
December
2020
Completed on
August 8, 2022
39,816 12,488 92.5 1,770 51.9 – –
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For 2022
Project Code Customer Project Type Solution Descriptions Duration
Status as of
the Latest
Practicable Date
Contract
Sum
(1) Y ear Ended December 31,
2021 2022 2023
Revenue
recognized
Gross
Profit
Margin (2)
Revenue
recognized
Gross
Profit
Margin (2)
Revenue
recognized
Gross
Profit
Margin (2)
RMB’000 RMB’000 % RMB’000 % RMB’000 %
Project No. 6 A group of local system integrators
and enterprise-level users (3)
Software plus hardware solutions in
city management and
administration, including
maintenance services
For details of our solutions offered
for the project,
see “– Our Solution Offerings –
V oicecomm Solutions – City
Management and Administration
– Case Study – Case Study 1:
Intelligent Town Project in
Chengdu” in this section.
Since October
2018
Ongoing N/A
(4) 121,415 17.3 128,489 21.8 134,793 25.5
Project No. 2 System integrator and subsidiary of
a Beijing-based company
providing science and technology
promotion and application
services, including to apartment
management companies, with a
registered capital of RMB10
million
Software plus hardware solutions in
other industries, including
maintenance services
Intelligent online management and
mobile service platforms for
apartment management companies
Since August
2021
Completed on
July 31, 2022
40,531 13,442 25.1 22,509 10.8 – –
Project No. 5 Customer B
(5) Software plus hardware solutions in
telecommunications industry,
including maintenance services
Intelligent security management
platform delivered to a major
telecommunications company for
it to provide value-added services
Since
November
2022
Completed on
December 1,
2022
24,748 – – 22,190 28.2 – –
Project No. 14 Customer A
(5) Software only solutions in
automotive and transportation,
including maintenance services
IoV management systems for
automobile companies
Since
November
2022
Completed on
November 10,
2022
15,600 – – 13,875 100.0 – –
Project No. 15 Enterprise-level user and a
Shanghai-based travel agency
providing a comprehensive range
of travel products and services,
with a registered capital of
RMB10 million
Software plus hardware solutions in
automotive and transportation,
including maintenance services
Intelligent travel consulting and
sales service platform
Since October
2022
Completed on
October 31,
2022
12,605 – – 11.302 51.9 – –
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For 2023
Project Code Customer Project Type Solution Descriptions Duration
Status as of
the Latest
Practicable Date
Contract
Sum
(1) Y ear Ended December 31,
2021 2022 2023
Revenue
recognized
Gross
Profit
Margin (2)
Revenue
recognized
Gross
Profit
Margin (2)
Revenue
recognized
Gross
Profit
Margin (2)
RMB’000 RMB’000 % RMB’000 % RMB’000 %
Project No. 6 A group of local system integrators
and enterprise-level users (3)
Software plus hardware solutions in
city management and
administration, including
maintenance services
For details of our solutions offered
for the project,
see “– Our Solution Offerings –
V oicecomm Solutions – City
Management and Administration
– Case Study – Case Study 1:
Intelligent Town Project in
Chengdu” in this section.
Since October
2018
Ongoing N/A
(4) 121,415 17.3 128,489 21.8 134,793 25.5
Project No. 7 Customer L (5) Software plus hardware solutions in
city management and
administration, including
maintenance services
Establishing Intelligent contact
centers for energy management
Since May
2023
Completed on
November 1,
2023
60,233 – – – – 54,070 13.1
Project No. 8 Customer M
(5) Software plus hardware solutions in
city management and
administration, including
maintenance services
Establishing intelligent
administrative platforms for
certain governmental entities in
Shanghai
Since March
2023
Ongoing 46,680 – – – – 38,005 1.8
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Project Code Customer Project Type Solution Descriptions Duration
Status as of
the Latest
Practicable Date
Contract
Sum
(1) Y ear Ended December 31,
2021 2022 2023
Revenue
recognized
Gross
Profit
Margin (2)
Revenue
recognized
Gross
Profit
Margin (2)
Revenue
recognized
Gross
Profit
Margin (2)
RMB’000 RMB’000 % RMB’000 % RMB’000 %
Project No. 9 System integrator and a Jiangsu-
based company providing
construction services, information
system integration and other
technology services, with a
registered capital of
approximately RMB7.1 million
Software plus hardware solutions in
automotive and transportation,
including maintenance services
Intelligent transportation
management and service platform
Since
December
2022
Completed on
December 20,
2023
32,134 – – – – 28,455 15.4
Project No. 19 System integrator and a Shanghai-
based company providing
computer information system
integration and other
development, consultation and
transfer services in related to
information technology, with a
registered capital of RMB10
million
Software plus hardware solutions in
automotive and transportation,
including maintenance services
Intelligent monitor and
communication systems for ships
Since April
2023
Completed on
December 1,
2023
28,000 – – – – 25,008 22.1
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Notes:
(1) For each completed project, the discrepancies between the contract sum and the total revenue generated were resulted from the exclusion of V AT.
(2) The gross profit margin for each project is calculated based upon costs that are directly related thereto, without considering fixed costs such as employee benefit expenses or
depreciation and amortization, etc.
(3) Our participation in the project entails the establishment of a digitalized technological infrastructure for an intelligent town cluster where the administration, production and
service activities, healthcare, security and educations, etc., of more than 200 towns are being unified and integrated into one public service platf orm. The large scale and
complexity of the project hence necessitate empowering a wide array of local companies and entities through our solutions to cover the breadth of the r equired domain expertise.
As such, we transacted with 14 local system integrators equipped with diverse resources and expertise during the Track Record Period to facilitate an d scale up solution
deployment, in addition to enterprise-level users that use our solutions directly, thus allowing tailored solutions for the varied needs within the intelligent town cluster in an
efficient manner per the project timeline. This approach lifts the burden of single-handedly manage delivery to each enterprise-level user across t he entire project and therefore
enables us to focus on our core strengths in solution development. According to the iResearch Report, it is market practice for a conversational AI sol ution provider to transact
with multiple system integrators and/or enterprise-level users in order to serve such type of municipal level intelligent infrastructure and imple ment smart community projects
of this magnitude. Due to its municipally complex and extensive nature comprising hundreds of towns in contrast to our other projects involving solut ions offered to any single
organization or enterprise, we derived a significant portion of revenue from the project, which contributed 26.4%, 24.9% and 16.6% of our total reven ue in 2021, 2022 and 2023,
respectively. Comparatively, the other projects we engaged during the Track Record Period were smaller in scale. Based upon the term of the contract w ith the latest expiration
date among the ongoing agreements that we entered into with the said group of local system integrators and enterprise-level users as of the Latest Prac ticable Date, the project
is expected to be completed on November 11, 2025. For details of the risks related thereto, see “Risk Factors – Key Risks Relating to Our Business, Indus try, Regulatory
Compliance, General Operations and Financial Prospects – We derived a significant portion of revenue from our intelligent town project in Chengdu du ring the Track Record
Period” in this prospectus.
(4) The project involves the use of agreements in which the exact contract sum is not stated therein and we settle with the respective customer through t he actual amount of orders
made by it.
(5) For details of our customers, see “– Customers and Customer Support – Top Customers” in this section.
The gross profit margin level of each of our projects is inherently dependent on the concrete software-and-hardware composition ratio of the
solutions that we provide therein. Overall, gross profit margins for our projects realized through software only solutions are higher than those
realized through software plus hardware solutions. With respect to our projects realized through software plus hardware solutions in specific, the
amount of hardware purchased by our customers largely depends on the specific hardware types required by the solutions as applied in the particular
scenarios. If the hardware involves servers, operating systems and other hardware deployed on the server side that are relatively confined by fixed
versions, our customers may procure a considerable portion of the same by themselves. If the hardware is more terminal side-oriented, such as
sensors, mobile devices, IoT devices, cameras, etc., as these hardware versions upgrade rapidly, there could be issues with software compatibility .
Specifically, software systems in relation to our V oicecomm Suites such as that on unified communication, speech recognition and language
processing need to be deeply embedded into such devices and adapted based on their operating system upgrades to provide compatible services. To
ensure overall service quality post-delivery and avoid compatibility issues caused by version upgrades, our customers typically prefer purchasin g
both software and hardware in an integrated fashion in such solutions, thus resulting in the relatively substantial hardware procurement amount and
lower gross profit margin level.
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As to a particular project realized through software plus hardware solutions, its gross
profit margin level in different years could additionally be affected by the fact that the
customer may purchase different items from us in batches. For example, it is common for our
customers to firstly procure hardware as an preparation for subsequently building
conversational AI capabilities, and then concentrate on purchasing software systems. It is
primarily due to this reason that the gross profit margin for project No. 8, an ongoing project
as of the Latest Practicable Date, temporarily amounted to 1.8% in 2023, and we expect that
the gross profit margin for the project will normalize towards a typical software plus hardware
solution level around 20% upon completion when software systems have subsequently been
purchased by the customer. In addition, after the said process, our customers may further
purchase additional hardware and software at the same time due to their business expansion
and increased communication needs, which can lead to drastic fluctuations of gross profit
margins for the same project across different years. It is primarily due to this reason that the
gross profit margins for project No. 3 fluctuated materially during the Track Record Period.
Specifically, its gross profit margin amounted to 92.5% in 2021, during which year the
customer concentrated on purchasing software systems after having procured hardware during
the previous year, and then decreased to 51.9% in 2022. Moreover, with respect to projects in
which the customers purchase software plus hardware solutions with a substantial amount of
mobile devices, it is common for them to firstly purchase integrated backend service platform,
and then concentrate on procuring mobile devices embedded with our software plug-ins
featured by a relatively lower gross profit margin level. It is primarily due to this reason that
the gross profit margin for project No. 2 decreased considerably from 25.1% in 2021 to 10.8%
in 2022.
When it comes to our projects realized through software only solutions, their gross profit
margins are primarily affected by: (i) software purchase volume, which impacts the per unit
software price; and (ii) the types and diversities of V oicecomm Suites specifically required by
the customers. As noted earlier, the gross profit margin for each top project listed above is
calculated based upon costs that are directly related thereto, without considering fixed costs
such as employee benefit expenses or depreciation and amortization, etc. As a result, the
project-based gross profit margin for project No. 14, which was realized through our software,
amounted to 100% in the relevant years.
Based upon the foregoing, the gross profit margins of the aforementioned top projects are
essentially not comparable, and the gross profit margin level of a given project in different
years may not necessarily be indicative of the overall level. However, the gross profit margin
for our software only solutions and software plus hardware solutions as a whole remained
relatively stable, respectively, during the Track Record Period. Moreover, primarily driven by
the increase in our offerings of higher-margin software systems within our solutions and the
increased level of modularization and standardization of our solutions, our overall gross profit
margin improved continuously during the Track Record Period, increasing from 33.1% in 2021
to 39.1% in 2022, and further to 40.0% in 2023. For details, see “Financial Information –
Description of Selected Components of Consolidated Statements of Profit or Loss – Gross
Profit and Gross Profit Margin” in this prospectus.
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Project Backlog
The following table sets forth the movement of the number of our projects in each year
of the Track Record Period and up to the Latest Practicable Date:
Y ear Ended December 31,
From
January 1,
2024 and
up to the
Latest
Practicable
Date2021 2022 2023
Number of ongoing projects at
the beginning of the
year/period 64 60 84 150
Add: Number of newly
awarded projects 204 197 298 151
Less: Number of projects
completed 208 173 232 106
Number of ongoing projects at
the end of the year/period 60 84 150 195
The following table sets forth the rolling backlog of our projects by outstanding contract
sum in each year of the Track Record Period and up to the Latest Practicable Date:
Y ear Ended December 31,
From
January 1,
2024 and
up to the
Latest
Practicable
Date2021 2022 2023
RMB’000 RMB’000 RMB’000 RMB’000
Outstanding balance at the
beginning of the year/period 324,582 297,884 382,476 500,850
Add: Contract value of newly
awarded projects 476,136 625,401 1,013,744 473,415
Less: Revenue (V AT inclusive)
recognized during the
year/period* 502,833 540,809 895,370 405,281
Outstanding balance at the end
of the year/period 297,884 382,476 500,850 568,983
Note:
* As the contract value according to the agreement is inclusive of V AT, for the purposes of calculating the
project backlog, the revenue recognized during the relevant year/period also includes V AT.
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OUR TECHNOLOGIES
Unified Communication Technologies
Unified communications refer to a mode of communications that integrates computer
technologies with traditional communication technologies, which require the unified
transmission of multi-media communications as of communications protocols, and interfaces
to integrate with information from operating software as of communication routing. It realizes
the connection and integration of multi-standard communication methods through gateways,
and provides full operational support covering audios, videos, data and multimedia, etc.,
thereby enhancing the level of communication flexibility and efficiency. Unified
communications rely fundamentally on the capabilities of integrating and harmonizing multiple
communication protocols governing different medium forms, whose adaptability to network
environments varies. Such harmonization allowing transmission of multi-media and
interactions of software systems are usually challenging in a conversational scenario. For
instance, each piece of communication transmits multimodal data consisting of not only audios
but also texts, images and videos, etc. In addition, unified telecommunications also allow the
direct interconnection between information from communication software and operating
software. Moreover, the software applied has to enable an effective control the initiation and
termination of the conversation and scheduling of the traffic of such data transmissions.
Additional considerations have also to be taken with respect to functions such as disaster
recovery, redundancy backups and automatic switches in the process of establishing a unified
communication system.
The foregoing entails numerous technological details and impose significant
technological requirements on the software engineering capabilities, which falls within our
realm of strengths owing to our strong unified communication technological capabilities.
Notably, our unified communication technologies support the three major international CTI
protocols, i.e., TAPI, TSAPI and CSTA, and the three major types of signal communication
methods, i.e., analog transmission, digital transmission and SIP-based communications.
Through nearly 20 years’ research and development, the communication channels that we are
able to unify have expanded from online chat, SMS, V oIP phone, WeChat and smart phone, as
well as traditional channels to those from the IoV-end and IoT-end, which has made us a leader
in the area. Leveraging our unified communication technological capabilities in a way that
synchronizes with the trend of organizations’ digital and intelligent transformation, we are able
to help them establish a softswitch platform that integrates traditional public switched
telephone network with mobile, data and other networks into an overall, unified and
multi-service network based on IPs, where there is no need to deploy media switching
hardware and communication channels integrated are intelligently routed, therefore facilitating
them to efficiently manage and utilize their communication resources. For example, when
receiving a call from service hotlines, our communication software can integrate with the CRM
system to retrieve the caller’s historical service information, thereby selecting proper service
personnel and plan, realizing personalized services, and creating fresh new interactive
experiences for users of our communication software.
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Our unified communication technological capabilities, as showcased by the successful
commercialization of our enterprise-level solutions offered to a wide range of end-customer
industries, derive essentially from our focused efforts exploring and developing unified
communication technologies for decades and the extensive capabilities formed during the same
process. Our founder, Chairman and executive Director, Mr. Jinghua TANG, began to conduct
research and development on unified communication technologies such as the CTI technology,
i.e., integrating and combining the functionality of PCs and desktop phones to manage call
operations synchronously, and enabling users to manage any call operation either using their
phones or PCs, as early as 2002. Since our Company was founded in 2005, unified
communications and their applications in different scenarios have continued to be a key area
of our research and development, and we are among the earliest in China focus on the area,
which makes us understand communication protocols more deeply and carry out related
software engineering more proficiently.
AI Technologies
Our AI technologies concentrate on effectively supporting multiple rounds of industry-
oriented conversations with natural flow and the whole interactive process from sound
collection, recognition, knowledge graph retrieval to speech synthesis and output being able to
be completed on a hundred millisecond basis. In light of the enterprise-level nature of the users
of our solutions, our AI technologies are being developed following a technological pathway
that emphasizes on accuracy and professionality of interactions enabled thereby with available
training data samples. As such, our AI technologies such as ASR, emotion recognition,
knowledge graphs, NLU, NLG and TTS are based upon AI models that are designed, trained
and optimized under our self-supervised leaning framework according to specific scenarios
faced by users in different end-customer industries, which can also be adjusted for any special
requirements. In addition to our completely AI technologies, we have developed a self-adaptive
algorithm engine that is able to automatically switch among algorithms and apply the most
optimal one for the specific conversational format and scenario. Highlights of the same are set
forth below:
 ASR. Our ASR technology allows high-performance and real-time conversion of
human speech into computer-processable inputs. Compatible with the speech inputs
of multiple languages, our ASR technology’s accuracy rates for recognizing a
variety of foreign languages such as English, Vietnamese and Thai, etc., as well as
Chinese dialects also lead ahead the industry average. For instance, the accuracy rate
for recognizing the dialect from Anyang, Henan has reached 95.2%, based on our
existing testing.
 Emotion Recognition. Based upon our algorithms extracting acoustic features from
speech signals, such as tone, volume and speed, we also have emotion recognition
technology that specifically processes and analyzes emotions of the speaker and
categorizes them into types such as happiness, anger, sadness and anxiety, etc.
Through analyzing speech signals in a sequential manner, our technology is able to
identify fluctuations and trends of emotions manifested in the conversation, and
analyze the emotional status of the speaker in different time intervals, based upon
which feedback and/or recommendations could be given intelligently as needed in
specific conversational scenarios, such as those related to customer services.
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 Knowledge Graphs. Our knowledge graphs are a set of intelligent knowledge
management and application systems featuring graphical organization and
presentation of, and structural storage of and interrelationships between, knowledge
related to different business operations, as well as automatic reasoning and
recommendation. Based on semantic webs which use knowledge fusion and entity
alignment technologies to form semantic entities as information nodes describing
instances and concepts, a visualized network diagram is formed to describe the
interlocking relationships between information nodes. Our technology is able to
automatically discover new knowledge and interrelationship between knowledge,
and intelligently analyze connections and attributes within the graphs, so as to come
up with individualized knowledge recommendation and analysis results concerning
cued connections. For example, when faced with users’ queries, the query system
based on our knowledge graphs can be utilized to deeply analyze the query intention
of users, and revert with accurate and comprehensive result information, which has
huge application potentials in addressing users’ query needs. Leveraging our
continuous service for different end-customer industries for decades, we are able to
develop industry-tailored knowledge graphs for different users.
 NLU. Our NLU technology realizes the intelligent analysis of texts by
understanding logics and semantic structures in natural language interactions.
Specifically, it enables functions including lexical and syntactic analysis
(constructing a syntax tree through the identification, disambiguation, word
segmentation and relationship establishment, etc., with respect to structures of
phrases and sentences), extraction and classification of specific entities (of names of
individuals, places and organizations, etc.), semantic extraction, i.e., intelligently
extracting relationships between the entities, and reference removal that accurately
identifies the referent in a sentence to ensure consistent interpretation. Leveraging
voluminous industry-specific insights in serving of our key end-customer industries
for decades, we have developed industry-tailored natural language algorithms that
have high re-use values to empower future projects. Notably, our natural language
algorithms support rapidly trainings based upon different languages through solid
learning of local language materials, which can then be efficiently put into our
natural language-related functional modules for use and thus substantially enhances
our engineering capabilities of globally implementing our solutions.
 NLG. Our NLG technology can generate natural language texts based upon our
algorithms and models. In addition to being applied in human-machine interaction-
related scenarios where texts could be automatically and intelligently generated for
making responses, the technology also supports generation of summary accounts
through processing and analyzing large-volume texts and extracting keywords
therein, and reports or articles based upon structural data, thus making business
management and operation more convenient and efficient.
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 TTS. With the unique intelligent voice controller enabled by the neural network
speech synthesis engine, our TTS technology can intelligently convert texts into
natural speech streams and generate smooth, natural and highly human-like audio
output with expectation-met timbre for listeners in real time, without the raw feeling
of machine voice. In addition, it has joint phonetic optimization ability and
high-fidelity audio generation ability. Specifically, it allows users to adjust such
output details as volume, speed, pronunciation of specific words and/or terms, voice
features (by female or male) and language (in Mandarin, English or Chinese local
accents, etc.) according to their specific needs in concrete application scenarios of
different end-customer industries.
 Self-Adaptive Algorithm Engine. Through developing our solutions to satisfy
diverse user needs, we have accumulated a number of AI algorithms that are
respectively at its best in different scenarios and functions (e.g., short texts vs. long
texts; real time vs. non-real time), including round-robin algorithms, convolution
algorithms, long short-term memory algorithms and migration algorithms.
Accordingly, we are able to embed within our solutions algorithm engine which is
self-adaptive to different scenarios to allow better performance of our solutions.
In addition, our core technologies in unified communications and AI as two technological
pillars synergize with each other effectively. For instance,
 Unified communication technologies effectively synergize with AI technologies.
Leveraging our strong unified communication technological capabilities, our
voiceprint recognition technology is uniquely empowered by our technologies
analyzing the underlying communication protocols used for transmission of signals
via different terminal devices. In multiple terminal device scenarios, we can
supplement the conventional technological approach to speaker recognition through
recognizing the specific speaker’s acoustic features with such communication
protocol analysis, which realizes the accurate audio source separation and intelligent
analysis of conversations involving multiple speakers. Also, our unified
communication technologies add on our ASR technology through the capability of
recognizing and withholding background noise involved in the conversation to
ensure the accuracy of speech recognition.
 AI technologies effectively synergize with unified communication technologies.
As to scenarios related to identity authentication over telephones, which have
traditionally been realized by password inputs based on telephone-routing
technology, they can further be empowered by our voiceprint recognition technology
as an additional method.
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Technological Collaboration
In addition to our AI algorithms and models, our AI technological capabilities are further
empowered by collaborations with our business partners. We have become one of the first
eco-partners of Baidu regarding the implementation of ERNIE Bot, its chatbot product
developed and offered through Baidu AI Cloud, into enterprise-level conversational AI
application scenarios. Leveraging our conversational AI technologies’ compatibility and their
ability to interface and coordinate with third-party models in specific solutions, we can procure
from Baidu APIs for ERNIE Bot. Specifically, we have realized the connection of the large
language model-based AI content generation capabilities of ERNIE Bot with our NLG, TTS
and multi-media gateway technologies, etc., in development or testing environments, through
which the two parties are able to jointly serve relevant application scenarios. We expect that
the centralized AI services, large language models as well as general knowledge base
underlying ERNIE Bot will serve as beneficial complement to our distributed AI services,
models based on few-shot learning and professional knowledge base. Our above-mentioned
technological orientation can strategically serve conversational AI needs in our key end-
customer industries characterized by relatively fewer training data samples and yet high
requirements on accuracy and professionality. The collaboration with Baidu on ERNIE Bot lets
us leverage its training achievements of general knowledge, which will allow us to better focus
on AI trainings relating to professional issues in specific application scenarios (where other
trainings on contents other than professional knowledge will be conducted by our
collaborators), thereby enabling us to further play to our strengths in scenarios requiring high
accuracy and professionality. For instance, we are able to realize path and answer predictions
with respect to our knowledge graphs technology and enhance its question identification
capability and reasoning speediness through large sample pre-training algorithms. As our
knowledge graphs technology focuses on ensuring response accuracy and accountability for the
enterprise-level users of our solutions, such technological fusion can additionally enable
humanized articulation and content expansion, thus providing an optimal user experience for
the individuals that they service. In addition, with our strong natural language generating
capabilities, we can enter into new end-customer industries or specific application scenarios
with faster speed and lower costs.
Our strategic collaboration with Baidu in such conversational AI ecosystem can be traced
back to 2021, in which we are also one of its few eco-partners with conversational AI research
and development capabilities. In addition to the foregoing technological synergies, we will
continuously cooperate with Baidu as well as other business partners on jointly developing and
offering competitive and standardized solutions through technology sharing and experience
exchanges, which will also bring us quality customer resources and improve our
commercialization strengths, therefore solidifying our competitiveness in enterprise-level
conversational AI.
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AI Empowerment Computing Center
To further enhance the capabilities of our AI technologies, we had been establishing an
AI empowerment computing center in Shandong as of the Latest Practicable Date, which,
equipped with ample GPU resources, could cloudify the computing power and training of AI
models. The computing center can not only substantially enlarge our computing power, but also
realize intelligent match-up of training assignments with the computer resources, thus
significantly reducing the average costs needed to train a model. Specifically, the completion
rate of jobs training deep learning models through the computing center can reach about 89.7%
for GPU cluster, and the average GPU resource utilization rate can reach about 58.0%. As the
computing center can significantly empower the efficiency of training our AI models, we are
able to effectively improve the performance of our solutions in various specific scenarios. As
such, we believe that our computing center will not only enhance our total computing power
and efficiency, but also make the production of AI models and the development of AI
capabilities more efficient and affordable, hence facilitating the commercialization of our
iterative and competitive solution offerings across different end-customer industries.
Our original plan was to establish the AI empowerment computing center within a
building made available by certain local governmental entity in Shandong pursuant to a
cooperation agreement that we entered into therewith in February 2021 (the “ Cooperation
Agreement ”). In accordance with the Cooperation Agreement, the governmental entity
constructed the building to provide venue for our AI empowerment computing center and we
then leased the said building and made necessary fixed assets investments thereto, including
necessary facilities and decorations, as well as servers, in order to use the said building as our
AI empowerment computing center. Such investments had been recorded in our consolidated
statements of financial position during the Track Record Period under the line item “property
and equipment”. For details, see “Financial Information – Discussion of Selected Items from
Consolidated Statements of Financial Position – Property and Equipment” in this prospectus
and Note 11 to the Accountants’ Report in Appendix I to this prospectus.
After the completion of the construction of the building itself, the main and standby
power supplies, which was undertaken by the governmental entity under the Cooperation
Agreement to provide, have not been provided, rendering the operation of the building as our
AI empowerment computing center infeasible. In response, we have been proactively and
continuously engaging in conversations with the relevant governmental authorities in order to
come up with solutions to the situations, and it has been mutually agreed upon between the
governmental entity and us that the parties’ cooperation over the building will continue. As of
the Latest Practicable Date, (i) we planned to use the building as a facility for customer
services, in which we can offer operators of customer services software systems and hardware
equipment, as well as workspace designated to agent seats, for them to provide services
remotely. As of the same date, we had completed the initial design of interior decoration and
renovation of the building, which could be so used after the completion of the same; and (ii)
the lease agreement entered pursuant to our cooperation with the governmental entity remained
effective without early termination by any party. However, due to the matters noted above, we
did not make any lease payment during the Track Record Period pursuant to our negotiations
with the governmental entity or make any actual use of the building.
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Under such circumstances, we consequentially identified alternative venues to
accommodate our AI empowerment computing center. Specifically, we have moved the servers
that we purchased out of the building mentioned above to the place of certain third-party
provider of server hosting services based in the same city, and intended to continue establishing
our AI empowerment computing center, at least for the period until the issues with the building
are solved, at the said place of the local service provider. By the end of December 2023, our
AI empowerment computing center had run online through such third-party provider of server
hosting services. For details of risks related to our expansion of computing power, see “Risk
Factors – Key Risks Relating to Our Business, Industry, Regulatory Compliance, General
Operations and Financial Prospects – If we fail to continuously develop and innovate our
solutions to meet enterprise-level users’ evolving needs, our business, financial condition and
results of operations may be materially and adversely affected” in this prospectus.
Key Technological Development Projects
We plan to continue to enhance our technological capabilities by exploring into various
areas with which our conversational AI technologies have promising expansion potentials.
Specifically, we have identified several key technological areas on which we have initiated
concrete projects, including:
 Reinforcement Learning, Transfer Learning and Federated Learning. We will
continue our fundamental AI technological explorations under the self-supervised
learning framework into reinforcement learning, transfer learning and federated
learning, aiming at further reducing the dependence of AI algorithms training on the
amount of data, and significantly enhancing the generalization ability of our
algorithms.
 Visualizable Conversational AI Empowered by Computer Vision AI. We will
endeavor to strengthen our technological accumulations in visualizable
conversational AI that is further empowered by computer vision AI technologies.
For instance, we aim to launch digital avatars with humanized images based upon
digital human technologies that are capable of mimicking human’s talking patterns,
logical thinking, facial expression recognition and learning, etc., in order to create
diverse characters performing customized interactions. Such digital avatars can be
applied in not only customer service scenarios in which it can recognize the
customers’ facial expressions to interact therewith in a more human-like fashion, but
also in wider areas that have demand for more vivid and engaging conversational
interaction experiences.
 Next-Generation Unified Communications Compatible with Visualizable
Conversational AI. Always committed to providing full-stack solutions, we have
also been exploring into the cutting-edge of unified communication technologies
compatible with the aforementioned visualizable conversational AI, especially
through mobile devices. In line with the proliferation of 5G networks and mobile
phones supporting 5G networks, the major telecommunications companies in China
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have gradually enabled video calls through their networks that are made via the
original calling interface of certain types of mobile phones. We believe that it will
be a trend for individuals to increasingly make video calls directly through such
original calling interface, which is likely to reshape the landscape of enterprises’
interactions with their customers.
As such, we have started researching into unified communication technologies for
signal processing and intelligent integration with respect to such video calls through
video gateways compatible with the networks of each major telecommunications
company in China. We expect that this endeavor will help achieve a new enterprise-
level interactive mode, with images of digital avatars smoothly delivered onto the
original calling interface of mobiles phones and signals of mobile phone users’
facial expressions stably transmitted and processed, thus enabling vivid human-
machine interactions. Moreover, since the said technologies can also enable the
customer service personnel to conveniently see what the mobile phone users see
through such video calls, we expect that the technologies will have broad
applicability in various scenarios where video-based conversations will provide
better user experiences and improve customer services, such as emergency
reporting, user identification, equipment maintenance and services, as well as
product presentation.
RESEARCH AND DEVELOPMENT
As conversational AI technologies continuously undergo rapid advancements, our
abilities to develop new technologies, design new solutions and enhance existing ones are
critical to maintaining our market leadership, which depends to a large extent on our
continuous commitment to research and development. As a result, we have invested
considerable resources in our research and development activities. In addition to our internal
research and development personnel, our research and development capabilities are further
reinforced by our collaborations with reputed academic institutes such as Shanghai Jiao Tong
University.
Our research and development activities are based upon iteration of our current solution
offerings and driven by promising market and technology trend, and each research and
development project is grounded in widely seen user needs and generally applicable scenarios,
which attributes considerably to the cost efficiency of our research and development. For
details of our research and development expenses during the Track Record Period, see
“Financial Information – Description of Selected Components of Consolidated Statements of
Profit or Loss – Research and Development Expenses” in this prospectus. During the Track
Record Period, all of our research and development expenditures were expensed.
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We have been conducting research and development on technologies in multiple areas,
which has been demonstrated by various awards, honors and recognition that we were granted
for our innovative endeavors and technological capabilities. For details, see – Awards and
Recognitions in this section. In the future, we will continue to invest in research and
development activities to enhance our technological capabilities and solution development.
Specifically, we are exploring new technological areas which may lead to the next generation
of conversational AI technologies. For details, see “– Our Technologies – Key Technological
Development Projects” in this section and “Future Plans and Use of Proceeds” in this
prospectus.
Our Research and Development Team
We have a rapidly growing research and development team, consisted of 215 dedicated
staff as of December 31, 2023, representing 67.4% of our total number of employees as of the
same date. Our research and development staff have expertise that spans a wide range of
technological areas including computer science, softswitch and integration technologies,
conversational AI and information security, and were involved in various processes of our
research and development activities on a regular basis. Our research and development
endeavors are supervised by our founder, Chairman and executive Director, Mr. TANG. Mr.
TANG is a seasoned innovator and business leader with more than 20 years’ extensive industry
experiences and sharp business acumen, during which period his continuous services for the
digitalization, informatization and intelligent transformation of enterprises have been widely
spanning from the design and implementation of networks to the development of various
computer systems. Mr. TANG received his master degree in software engineering from
Shanghai Jiao Tong University in 2005. With rich research, development and management
experience, our research and development team has developed an internal best practice and
maintained a mature and established process for the development, evaluation and validation of
our solutions.
In 2023, Academician Jifeng HE, a world-renowned computer scientist, joined us as our
Chief Scientist. Graduated from the Mathematics Department of Fudan University in 1965,
Academician HE was elected to the Chinese Academy of Sciences in 2005. Academician HE
primarily works as a distinguished professor at Tongji University and a tenure professor at East
China Normal University, and also served as the Dean of the School of Computer Science and
Software Engineering at East China Normal University. As a reputed scientist with extensive
scholarship experiences at top institutes across different countries, Academician HE has led a
number of national research programs and received numerous prestigious science and
technology awards.
Academician HE is the pioneer of trusted software design theory and technology, for
which he promoted the novel research of interdisciplinary information-physical fusion systems
in China which laid the foundation of the trusted software architecture. In furtherance of such
trusted software design theory, Academician HE is among the first few scientists in China to
put forward the notion of responsible AI that emphasizes the importance of data, model,
platform and operation being responsible in the applications of AI technologies, as well as to
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facilitate the industrialization of the same. Academician HE’s research on responsible AI fits
nicely with our solutions in serving enterprise-level application scenarios, such as city
administrations and ICVs, that necessitate high service professionality and output accuracy,
and thus have more promising commercialization potentials. As such, we believe that the
common interest between Academician HE and us in such intersection of “professional
responsible AI” will substantially enhance our fundamental technological capabilities in
conversational AI. Specifically, Academician He is responsible for our technological planning
in enterprise-level responsible AI and consulting on the application of our ICV solutions, which
we envision will greatly drive our technological accumulations in such areas with his academic
achievements.
Currently, Academician HE contributes to our research and development technological
capabilities by: (i) attending periodical discussions on recent developments and orientation of
our business expansion and research and development activities; (ii) reciprocally sharing
opportunities of industry forums, which keeps us abreast of industry and technology frontiers;
(iii) jointly formulating research and development programs, as well as assisting applications
of the same; and (iv) participating in the execution of our cutting-edge projects.
We have entered into legally-binding confidentiality agreements with our key
technological personnel and employees involved in our research and development activities,
pursuant to which any intellectual property conceived and developed during their employment
in the course of performing their duties thereunder or otherwise exploiting our technologies or
business-related information belongs to us.
V oicecomm Research Institute
Leverage our academic resources, we have established our V oicecomm Research Institute
(Ӻ৫) as a special unit under our broader research and development team, which is led
by Dr. Xiang LIN. Dr. LIN has comprehensive academic research experiences in conversational
AI areas for nearly 20 years. Dr. LIN is the assistant to the Dean of the Institute of Cyber
Science and Technology of Shanghai Jiao Tong University, and also acts as the Chief
Engineering of the National Engineering Laboratory for Information Content Analysis
Technology thereof. Dr. LIN has received the First Prize of Shanghai Science and Technology
Advancement Award (ኪҦஔආӉᆤɓഃᆤ) and was selected in the “Rising-Star
Program” of Shanghai’s Science and Technology Innovation Action Plan ( ɪऎ̹“Ҧ௴อБ
ྌ”ධͦ), among other awards and honors that demonstrate his widely recognized
academic credentials.
The research and development activities carried out through our V oicecomm Research
Institute mainly address specific projects worth of in-depth exploration that arise in the course
of our services of users of our solutions. Research and development personnel at our
V oicecomm Research Institute maintain regularly and constructive communications with team
members across various customer projects, and formulate research topics according to the
latter’s practical needs. For instance, it conducts research on ASR and NLU as needed in the
quality assessment and assurance process, on speaker recognition through communication
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protocol analysis, and on the scheduling of intelligent transportation related and AI resources
derived from the ICV project in Zibo. To further encourage and incentivize the research and
development personnel to make contributions to our customer projects, we have designed an
evaluation and compensation structure that includes a fixed component as well as a
performance-based component, and sets specific performance targets for each member.
Research Laboratory for AI Applications in Collaboration with the School of Electronic
Information and Electrical Engineering (the “SEIEE”) of Shanghai Jiao Tong University
On April 10, 2021, the SEIEE of Shanghai Jiao Tong University jointly and we
established the Research Laboratory for AI Applications (AI܃whereby the two
parties aimed at establishing comprehensive cooperation in the research and development of
conversational AI technologies. The Research Laboratory for AI Applications operates as a
specific research and development platform covering such primary conversational AI areas as
voiceprint-based emotion recognition analyzing multimodal information, TTS, NLP and
knowledge graphs, as well as fundamental next-generation conversational AI studies and
cutting-edge topics that are crucial for our further growth prospects and penetration into new
application scenarios. For instance, the Research Laboratory for AI Applications plans to
expand our knowledge graphs technology to improve its comprehensiveness and reasoning
capability. The Research Laboratory for AI Applications also targets to develop a machine
learning service platform based upon federated learning that ensures data security and privacy.
The Research Laboratory for AI Applications can explore the training of AI algorithms based
upon the intelligent computing platform within our AI empowerment computing center. The
Research Laboratory for AI Applications will utilize our intelligent computing platform with
cloudified computing power to effectively train and optimize our conversational AI models, as
well as to explore the self-adaptive engine for the most optimal conversational AI model for
specific scenarios. Moreover, the Research Laboratory for AI Applications is also expanding
such intelligent computing platform’s boundaries for being used as an AI model training
ecosystem that will not only benefit our solution offerings but can also be leveraged by other
enterprises and third parties for their needs of enhancing their in-house AI capabilities.
In addition, the Research Laboratory for AI Applications and we regularly hold forums
and salons, where faculty members from the SEIEE of Shanghai Jiao Tong University will
present latest development in various AI areas and awards-winning graduates therefrom will
also share with us their algorithm developments. Through such reciprocal dialogues and
exchanges, our research and development personnel also provide valuable insights that may
inform the future studies of such academicians. We believe that the establishment of the
Research Laboratory for AI Applications will help us combine AI fundamental theories and
technologies with specific application scenarios, form next-generation solutions through
in-depth cooperation, and build an AI innovation ecology of industry, academia, research and
application integration.
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Pursuant to the collaboration agreement that we entered into with the SEIEE of Shanghai
Jiao Tong University, we are solely entitled to any intellectual property in relation to our
research and development projects carried out by the Research Laboratory for AI Applications
and have the exclusive right to commercialize any of such projects. Provided that no
technological secrets are involved and no commercial interests of us are affected, the school
and the related personnel shall have the right to publish papers in relation to the joint research
and development and use the research results for scientific research and pedagogical purposes,
and shall not use the same for any commercialization purposes.
In the future, we also look forward to establishing further collaborations with other
institutes and we recognize the significance of such collaborations in contributing to our
continuous research and development efforts. For details of risks relating to such research and
development collaborations, see “Risk Factors – Risks Relating to Our Business – The
termination of any collaborations with our partners for joint research and development projects
may adversely affect our business prospects” in this prospectus.
Our Solution Development Process
Our solution development process is grounded in the pain points experienced by
enterprises and other organizations in their respective industries. Our research and
development staff collaborate closely with each other to develop high-quality solutions,
innovate sustainably and continually expand our technological boundaries, through which
process they also gain valuable experiences and know-how on solution development that will
further underpin our strong research and development capabilities. Key steps in our solution
development process typically consist of:
 Preliminary Study and Communication. We firstly conduct insightful study and
understand the relevant technological developments and trends, as well as take
initiatives on industry-oriented research to collect demands, requirements and
preferences from the existing and prospective users of our solutions.
 Technological Demand Characterization and Analysis. After our preliminary
study and communication, we then characterize the specific technological
requirements from the users, analyze our core competitive strengths in the respective
end-customer industries, and establish a clear priority among different demands and
pain points.
 Project Establishment and Design. We define the key functional and performance
parameters to address user demand, develop a detailed project schedule, establish
efficient workflows and progress monitoring, and set up definitive goals and
deliverables.
 Pilot Launch. After we develop the framework design, we will complete the coding,
testing and solution launch in-house.
 Continuous Optimization. Based on the feedback collected, we make continuous
efforts to optimize functions and performance of our solutions, and research into
updated versions with improved features and functionalities where necessary.
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Our Industry Know-how
In addition to our technological capabilities, industry know-how also contributes
significant to the commercial viability of our solutions. Without contribution of industry
know-how, our solutions may be of high technology but no business value. Given our core
research and development mindset that is well-advised by enterprise-level users’ needs and our
rich project experiences piled up since our foundation, we have recognized the necessity of
industry know-how in the process of our solution development. As such, we routinely
accumulate and comprehend industry know-how in the end-customer industries in which we
operate and apply the same into training our AI algorithms and optimizing the industry-specific
knowledge graphs and base, which has been proved to be crucial in putting our resources into
right direction and substantially ensured the performance of our solutions. Based on our
abundant industry know-how, we are also able to design and embed script templates of
communications into our competitive solutions that can significantly facilitate users’
communications with their customers or other third parties connected via our solutions.
Furthermore, to accelerate our development processes, we use our industry know-how to
evaluate (i) the commercial viability of our research; (ii) the competitiveness of our
technologies and solutions; and (iii) the costs and returns of research and development
activities as measured by research efficiency. Input from our industry know-how has therefore
focused our research and development efforts on areas with potential commercialization
opportunities, lower competitive barrier and cost savings such that our resources are efficiently
utilized.
INFORMATION SYSTEM, DATA SECURITY AND PRIV ACY PROTECTION
Information system and data security is our long-held commitment, to which we attach the
greatest importance. In this regard, we have formulated comprehensive internal control policies
and risk management mechanisms with the purpose to ensure data and information security,
optimized data governance, protection of the benefits of our customers, business partners,
employees and other third parties, and compliance with all applicable laws and regulations as
well as prevalent industry practice. For details, see “– Risk Management and Internal Control
– Information System and Data Security Risk Management” in this section.
Our Board of Directors is collectively responsible for formulating information system and
data security strategies, and decision-making in material information and data incidents. Under
its supervision, our management oversees network, system and data security matters related to
our business operations, and we also have dedicated technological personnel who maintain our
IT systems and infrastructure and implement our policies on information system and data
security. As sufficient maintenance, storage and protection of data and other related
information are critical to our success, we intend to continually invest heavily in information
system and data security. During the Track Record Period and up to the Latest Practicable Date,
we had not experienced any material incidents of system breakdowns, data breaches, hackings
or losses, or information leakage.
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However, we are exposed to risks in relation to system and data security in our operations.
We may be targeted by cyberattacks, distributed denial of service attacks, hacking and phishing
attacks, security breaches, computer malware, and other malicious internet-based activity. For
details of risks with respect to information system and data security that we may encounter, see
“Risk Factors – Risks Relating to Our Business – Our business is subject to system and data
security risks, and our technology infrastructure may experience unexpected system failures,
interruptions, inadequacy, security breaches or cyberattacks, which may harm our reputation,
business and results of operations” in this prospectus.
Data Privacy
We are subject to various laws and regulations regarding cybersecurity, privacy and data
protection. For details of such laws and regulations, see “Regulation Overview – Regulations
Relating to Internet Information Security and Privacy Protection” in this prospectus.
For purposes of completing transactions and offering solutions in the course of our
business operations, the types of customers’ data that we usually receive through email
communications include: (i) the basic corporate information and contact information of the
customers; (ii) the business description of the customers and other information related to their
business operations; and (iii) certain technical information of the customers and their
systems/platforms, which may also be authorized by our customers to be downloaded from the
portals that they provide.
With respect to personal information, we do not have ownership over or proactively
collect the data from our customers/enterprise-level users or their users, and only access and
process such data on an as-needed basis per our customers’ authorization and request for model
training to fulfill the purposes of our solution offerings in limited cases, such as for optimizing
AI algorithms and enhancing our standardized solutions’ functionalities in a specific
application scenario. We do not proactively collect data from our customers/enterprise-level
users in the sense that, when providing our standardized solutions, we do not require our
customers/enterprise-level users to provide their data or their end users’ personal information
to us. However, if a customer requires us to customize the solutions in specific industry or use
scenarios for more satisfactory performance, we may need to ask it to provide us with data
consisting of dialogues involving individuals, for the purpose of optimizing the AI algorithms
involved and enhancing our solutions’ data recognition accuracy therefor.
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Substantially all of the data we access, process or use for us to analyze the scenarios are
in the form of raw audio recordings consisting of voice dialogues involving individuals in
scenarios across a number of industries provided by our customers. Procedurally, we access
such raw audio recording data normally through portals designated by the customers to
download the same by using the account and password provided by the customers, and the data
will be stored in the servers deployed in our premises for processing. After receipt of the raw
audio recording data from a customer, the recordings will be partitioned and randomized before
we use them to optimize the AI algorithms which will be used in the solutions to be provided.
After the said steps, the resultant recordings will no longer contain any information which can
be used to identify or to correlate with any particular individuals. The recordings will only be
retained by us during the period necessary for completing the optimization, the duration for
which is essentially contingent upon the specifics of different projects and will normally last
less than two weeks. During the Track Record Period and up until May 2023, we conducted the
abovementioned data desensitization process ourselves. To further tighten our data processing
practice in relation to data privacy, we have been requiring our customers to desensitize the
data before sharing to us for optimizing AI algorithms since June 2023. After completing the
optimization, the raw audio recording data will be deleted permanently and we will only retain
the C-language files (source code files written in the C programming language, representing a
desensitized and machine-readable binary format) resulting from the optimization as our
training data, which contain no personal identifiable information. As between our customers
and us, our customers own the raw audio recordings data, and we own the said C-language files
as our work product, which will be added into our database for further use in the future.
Under such circumstances, we obtain the customers’ prior authorization and delegation
before accessing and processing such data. During the Track Record Period, we obtained the
consents from our customers under our agreement therewith for accessing and processing the
data that they provided. Furthermore, we have formulated a comprehensive data protection
clause that is provided in the agreement entered into with our customers. Such data protection
clause clearly provides for the customer’s responsibilities for handling personal information
when using our solutions or entrusting us to process personal information on its behalf. If a
customer provided its raw audio recording data to us, we also required it under such data
protection clause to contractually commit to us that it had obtained the consents from the
relevant data subjects for collecting and processing their personal information or had other
legal basis under the PRC Personal Information Protection Law (ࢹڦ
)( “PIPL”) to collect and process such personal information. As advised by our PRC
Legal Adviser, given that the customer determines the purposes and processing methods of
processing the personal information contained in the raw audio recordings, the customer is the
“personal information handler (٫as defined by the Article 73 of PIPL and we
are only the entrusted party under the Article 21 of PIPL to process desensitized information
under its instructions. As further advised by our PRC Legal Adviser, according to the
Articles 13 and 14 of PIPL, the customer as the “personal information handler” is obligated to
ensure the legitimacy of collecting the relevant personal information and entrusting us to
process on behalf of it. Our accessing and processing of data are strictly restricted to the
limited purposes of AI algorithm training and optimization and will only last for the service
period as agreed upon with our customers, after which, all relevant data except for the
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C-language files noted above will be promptly and properly deleted or destructed. We typically
undertake to comply with all applicable laws and regulations in connection with the collection
of such data, including but not limited to any laws in respect of intellectual property rights,
privacy, data protection, personal information protection, and personality rights. In addition,
we have established data privacy policies to ensure that our data accessing and processing
activities are for legitimate purposes and conducted in accordance with applicable laws and
regulations, for instance:
 We strictly process data in the manner that has the least impact on the rights of data
subjects. We process data with specific and reasonable purpose, which is limited to
the minimum scope for achieving the purpose of optimizing our AI models and
solutions, and data shall not be used for any purpose irrelevant to such purpose;
 Before AI models training, we ensure that the input data are not used for individual
identification purposes and are contents pre-treated without personal identifiable
information attached in nature;
 We implement internal authentication and authorization mechanisms to ensure that
the data we process can only be accessed by authorized personnel, with visit records
documented via system logs; and
 We annotate and conduct training on the data in accordance with the restricted
purposes of usage and limited time frame of storage as stated in our agreements.
After the collaborations are completed, we will proceed with deletion or destruction
of the relevant data to comply with our corresponding obligations promptly and
properly.
Moreover, we strictly follow our internal data security policies and rules when collecting
and processing the above data provided by our customers. Our data security policies and rules
cover the data security objectives, organization, data security risk assessment and response
mechanism, and access control requirements and more. We have formulated a data
classification and grading catalog and implements different access control and security
measures accordingly. We have also established and appointed management groups and
executive teams in charge of data security matters. By implementing those policies and rules,
we believe that the data collected and processed by us are safeguarded from unauthorized
access, destruction, leakage, or misuse. Upon reviewing our relevant internal control policies,
our internal control consultant confirms that the design of such policies does not contain any
material defects or issues, and confirms that such policies, once implemented, can effectively
safeguard irregularities with accessing and processing data (including personal data, if any) in
all material aspects.
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We believe that, by the above-mentioned measures, we have reasonably fulfilled our
protection obligations with respect to the personal information that may be contained in the
data that we access and process. During the Track Record Period, we had not purchase any
personal information or other data from our customers or any other third parties during the
Track Record Period.
During the Track Record Period and up to the Latest Practicable Date, there had been no
incident of data or personal information leakage, pending or threatened investigation, penalty,
litigation or other legal proceeding against us claiming personality rights infringement or data
protection initiated by competent government authorities or third parties, or violations of data
privacy laws and regulations, to the best knowledge of our Directors, that would materially and
adversely affect our business operations. Based upon the foregoing, our PRC Legal Adviser
was of the view that, during the Track Record Period and up to the Latest Practicable Date, the
data privacy practice of our Group met the requirements of laws and regulations in effect in
material respects.
We will continue to pay close attention to the legislative and regulatory developments in
data privacy and ensure that our operations comply with the latest regulatory requirements.
Nevertheless, we are subject to risks relating to the regulatory uncertainties in this regard. For
details, see “Risk Factors – Key Risks Relating to Our Business, Industry, Regulatory
Compliance, General Operations and Financial Prospects – As our business is subject to
complex and evolving laws, regulations and governmental policies regarding cybersecurity,
privacy and data protection and generative AI services, actual or alleged failure to comply with
applicable laws, regulations and governmental policies could damage our reputation, deter
current and potential customers or end users from using our solutions, and subject us to
significant legal, financial and operational consequences.” in this prospectus.
Internet Information Security
On November 14, 2021, the CAC released the Network Data Security Management
Regulations (Draft for Comment) (the “ Draft Regulations ”), which stipulate several
requirements for entities who process data through the use of networks, including that data
processors shall (i) be responsible for the security of the data it processed and shall undertake
data protection obligations; and (ii) establish comprehensive data protection system and
technical protection mechanism. For details of the Draft Regulations, see “Regulatory
Overview – Regulations Relating to Internet Information Security and Privacy Protection” in
this prospectus.
Our PRC Legal Adviser is of the view that the possibility that our proposed Listing in
Hong Kong may give rise to national security risks and require the application of cybersecurity
review is remote, considering that: (i) we do not utilize the internet to provide services, and the
solutions delivered to our customers are deployed on servers or cloud platforms controlled by
the customers/enterprise-level users themselves and utilized by them to carry out their own
business, while we are not involved in the operation of the solutions or their underlying
platforms; (ii) our main business is to utilize AI technologies to develop and provide the
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solutions that are deployed and used by our customers/enterprise-level users themselves, and
we do not externally provide any data processing services; (iii) as of the Latest Practicable
Date, no entity of our Group was determined by the competent authorities as a critical
information infrastructure operator (“ CIIO(s) ”); (iv) we do not directly collect the personal
information from our customers/enterprise-level users. Instead, we are only entrusted by a few
customers to use the raw audio recordings provided by them that will be partitioned and
randomized in prior to optimize the AI algorithms to be used by the relevant
customers/enterprise-level users. After completing the optimization, the raw audio recording
data will be deleted permanently and we will only retain files resulting from the optimization
as our training data, which contain no personal identifiable information; (v) we do not transfer
any customer data or other personal information to recipients outside of mainland China in our
business operations; and (vi) we have taken appropriate technical and organizational measures
to safeguard the security of the data that we processed. Based upon the foregoing, our Directors
believe, and the Sole Sponsor concurs, that even if the Draft Regulations are adopted in their
current form, it is unlikely that we will be required to apply for cybersecurity review for our
proposed Listing in Hong Kong.
The data processing activities involved in our business operations will be subject to the
requirements set by the Draft Regulations if they become effective. Even if the Draft
Regulations are implemented in their current form, our Directors believe that we will be able
to comply with the requirements in our business operations and they will not have a material
adverse impact on us, considering that: (i) we have established internal management bodies
responsible for information security, data security and personal information protection,
respectively, in accordance with the requirements of applicable laws and regulations, and have
appointed persons in charge of the said matters; (ii) under the supervision of these internal
management bodies, we have a data security team of engineers and technicians dedicated to
protecting the security of the data that we processed; and (iii) we have also adopted strict
internal policies on information system and data security risk management, to ensure the
security of the data that we processed. For details, see “– Risk Management and Internal
Control – Information System and Data Security Risk Management” in this section.
According to the amended Cybersecurity Review Measures , which have come into effect
on February 15, 2022, (i) the purchase of cyberspace products and services by the CIIOs and
the network platform operators (the “ Network Platform Operators ”) which engage in data
processing activities that impact or may impact national security shall be subject to
cybersecurity review by the Cybersecurity Review Office; and (ii) the Network Platform
Operators with personal information of more than one million users that seek for listing in a
foreign country are obliged to apply for cybersecurity review by the Cybersecurity Review
Office. For details of the Cybersecurity Review Measures , see “Regulatory Overview –
Regulations Relating to Internet Information Security and Privacy Protection” in this
prospectus.
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Our PRC Legal Adviser confirms that neither our business operations nor our proposed
Listing in Hong Kong will trigger the obligation to apply for cybersecurity review by the
Cybersecurity Review Office pursuant to the amended Cybersecurity Review Measures ,
considering that: (i) as of the Latest Practicable Date, no entity of our Group was determined
by the competent authorities as a CIIO; and (ii) we neither processed the personal information
of more than one million users nor applied for listing in a foreign country.
In addition, our PRC Legal Adviser notified China Cybersecurity Review Technology and
Certification Center (“ CCRC”) through a telephone consultation on May 23, 2023, and has
been advised that: (i) our proposed Listing in Hong Kong does not constitute a “listing in a
foreign country” as described under the Cybersecurity Review Measures , and therefore we are
not required to proactively apply for cybersecurity review thereunder; and (ii) the Draft
Regulations are in draft form and have not yet come into effect, and we are not required to
apply for cybersecurity review under the Draft Regulations. Based on the reasons above, our
Directors are of the view that the Cybersecurity Review Measures do not apply to us and will
not have a material adverse impact on us in material aspects, and the Sole Sponsor concurs with
the Directors’ view based on the reasons above.
Generative AI Services
On July 13, 2023, the CAC and other six ministries jointly published the Interim
Administrative Measures on Generative AI Services (the “ Interim Measures on GAI ”),
effective on August 15, 2023. The Interim Measures on GAI apply to the provision of generated
contents such as texts, images, audios and videos to the public within the territory of China by
utilizing generative AI technologies (“ GAI Services ”). The Interim Measures on GAI, among
other things, (i) set forth principles for provision and use of GAI Services; (ii) impose various
obligations for the provider of GAI Services, from protection of users’ personal information to
content monitoring and filtering; (iii) provide specific requirements for the data training
activities such as pre-training and fine-tuning; and (iv) require the providers of GAI Services
to conduct security assessment for provision of GAI Services with public opinion attributes or
social mobilization capabilities and file for records with the CAC. For details of the Interim
Measures on GAI, see “Regulatory Overview – Regulations and Policies on Information
Industry – Regulations on the Application of Artificial Intelligence Technologies” in this
prospectus.
According to our PRC Legal Adviser, there are two elements for determining the
applicability of the Interim Measures on GAI: (i) whether the services are GAI Services; and
(ii) whether such services are offered to the public within China. Our PRC Legal Adviser is of
the view that the definition of “the public” under the Interim Measures on GAI is confined to
individual users and does not apply to institution users, considering that:
 Textually, the term “the public” ( ʮ଺) in Chinese refers to the people, i.e., the
general public. It is a collective term for many individuals;
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 Specifically, Article 2 of the Interim Measures on GAI provides that they will not
apply to the industrial organizations, enterprises, educational and scientific research
institutions, public cultural institutions, and relevant professional institutions that
develop and apply generative AI technologies and do not provide GAI Services to
the public within China. Such clause reflects the legislative intent of regulating only
the GAI Services to be used by individual users; and
 In addition, there are various other detailed requirements of the Interim Measures on
GAI for services aimed at individual users, not enterprise-level services, for
example: (a) Article 10 requires the service provider to disclose the target groups of
people that its services are designed for and take measures to prevent minor users
from overly relying on or becoming addicted to its GAI Services; and (b) Article 11
prevents the service provider from retaining the inputs or use records that can be
used to identify a user’s identity.
By applying the test to us, our PRC Legal Adviser is of the view that our current
businesses do not fall into the scope of provision of GAI Services to the public and thus the
Interim Measures on GAI do not apply to our current businesses, considering that: (i) we only
provide our AI technology-based solutions to institutions and we do not directly provide any
services to individual users; (ii) as far as GAI technologies are concerned, our solutions are
provided in the form of preset software systems that are installed and deployed in the servers
and cloud platforms controlled by our customers/enterprise-level users, and the content
generating functions of our solutions are only used by themselves through such software
systems; and (iii) even if certain customers/enterprise-level users may provide their own
services enabled by our solutions to their own end users, such end users that they serve do not
have any access to our AI technologies to generate any content. Taking our telephone banking
solutions as an example, the intelligent virtual agents realized by our AI technologies can
facilitate banks’ customer services by intelligently engaging in voice conversations with the
individual customers of banks to fulfill various telephone banking functions such as queries,
transaction instructions and identification. The AI based services involved in this service
process realized by our AI technologies, however, are unilaterally and exclusively enjoyed by
banks, but not their individual customers. In other words, while our AI technologies automate
banks’ customer services from the institutional end, it is not possible for the individual
customers to leverage our GAI functionality provided to banks and they still have to interact
with the intelligent virtual agents by themselves. This is essentially because our AI models
cannot be used by any individual users through programmable interfaces, and, as noted above,
we do not open our AI models to the public.
Moreover, our PRC Legal Adviser made an anonymous consultation with the CAC’s
hotline responsible for the algorithm filing matters on December 19, 2023. Notwithstanding
that no clear guidance on the applicable scope of the Interim Measures on GAI was given
during the consultation, the official pointed out that if AI-based content generating services are
indirectly provided to individual users through institution users, the Interim Measures on GAI
will apply. According to our PRC Legal Adviser, “indirectly provided to individual users”
describes the scenario where an AI-based service provider allows the AI-based content
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generating functions to be used by individual users who do not transact with the service
provider but have access to the content generating functions through an intermediate entity
(i.e., an institution user of the service provider’s AI-based services). In that case, the Interim
Measures on GAI still applies because the AI-based content generating functions are ultimately
used by individual users, or the public, to generate contents. However, after examining our
solutions and our business model, our PRC Legal Adviser believes that this “indirect
provision” scenario is fundamentally different than the service process of our solutions
deployed by enterprise-level users based on the following reasons:
 As illustrated by the abovementioned telephone banking solutions case study, the
functionalities enabled by the AI-based content generating modules embedded
within our solutions are exclusively used by our enterprise-level users (institutions)
and none of our solutions provides any data interfaces to allow them to make the
content generating functions available to their end users (individuals). As displayed
by the following diagram, the AI-based content generating functions can only be
used within the scope of the dotted box:
Voicecomm
Enterprise-Level
User
Environment
End Users of
Enterprise-Level
Users
Communication through
voice or texts
AI-based content generating
functions are used by
enterprise-level users to generate
customized responses, etc.
Enterprise-Level
Users’ Platform
Facing End Users
Voicecomm Solution
(including AI-based content
generating modules)
Generate responses
and other contents
 In addition, from a technical feasibility perspective, our AI-based content generating
modules and other functional modules are encapsulated within our comprehensive
solutions. Not developed as standalone applications, such modules are able to form
a complete processing flow only when combined with each other to jointly assist our
enterprise-level users in better achieving their business objectives. From an
interactional meaningfulness perspective, the AI-based content generating modules
embedded within our solutions are trained solely for business scenarios of our
enterprise-level users across different end-customer industries, rather than for
personal use by their end users. Thus, it is not only technically infeasible for our
enterprise-level users to make the content generating functions of our solutions
available to their end users, but also interactionally unmeaningful for them to so.
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Based upon the foregoing, since we do not directly or indirectly provide any AI-based
content generating services to individual users, our PRC Legal Adviser believes that our
current businesses fall out of the applicable scope of the Interim Measures on GAI. However,
considering that only an anonymous consultation was conducted with the CAC during which
no clear confirmation on the applicable scope of the Interim Measures on GAI was provided,
as well as the additional fact that there has been no official interpretation or specific
implementing rules thereon, it essentially remains uncertain as to whether our current
businesses will be deemed to constitute indirectly providing AI-based content generating
services to individual users and thus subject to the Interim Measures on GAI. For details, see
“Risk Factors – Key Risks Relating to Our Business, Industry, Regulatory Compliance,
General Operations and Financial Prospects – As our business is subject to complex and
evolving laws, regulations and governmental policies regarding cybersecurity, privacy and data
protection and generative AI services, actual or alleged failure to comply with applicable laws,
regulations and governmental policies could damage our reputation, deter current and potential
customers or end users from using our solutions, and subject us to significant legal, financial
and operational consequences” in this prospectus.
That said, our PRC Legal Adviser is of the view that we would be able to comply with
the Interim Measures on GAI in all material respects assuming its applicability to our current
businesses, considering that: (i) we have adopted internal procedures to ensure that our
operations are in compliance with applicable laws and regulations, including the Interim
Measures on GAI. Specifically, we will strengthen our legal and compliance risk management
by monitoring legal updates and updates on the interpretation of applicable laws and
regulations by relevant regulatory authorities, including that in relation to the Interim Measures
on GAI, and accordingly updating our internal protocols and procedures in a timely manner.
For details of our risk management and internal control with respect to legal and compliance
risk management in particular, see “– Risk Management and Internal Control – Legal and
Compliance Risk Management” in this section; and (ii) moreover, we have also taken
contractual and other measures to ensure the legitimacy of the source of the training data we
used. As of the Latest Practicable Date, we (a) had formulated and implemented our algorithm
security management standards and rules, including mechanisms such as keywords
identification and illegal contents filtering that prevent our AI models from being used to
generate illegal or false information; and (b) were in the process of filing for record for our
algorithms with the CAC. Upon reviewing our internal management measures of algorithm
security, our internal control consultant confirms that the design of such measures does not
contain any material defects or issues, and confirms that such measures, once implemented, can
effectively prevent our algorithms from being misused in a way unintended by us in all material
aspects.
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Specifically, pursuant to the Administrative Provisions on Deep Synthesis in Internet-
based Information Services (), technical supporters of
deep synthesis technology (the organizations or individual that provide technical supports for
deep synthesis services) are required to file for record with the CAC’s algorithm record-filing
system and disclose the information regarding the algorithm data, algorithm models, algorithm
strategies and algorithm risk and prevention mechanisms, as well as how the technical supports
are provided. Moreover, under the Interim Measures on GAI, such filing requirement also
applies to the GAI services “with public opinion attributes or social mobilization capabilities”.
Under the Administrative Provisions on Deep Synthesis in Internet-based Information Services ,
(i) we have to file our algorithm record with the CAC; (ii) as of the Latest Practicable Date,
we had submitted the eligibility certification application, and had obtained approval from the
CAC; and (iii) we then submitted algorithm security self-assessment report and other materials
to the CAC for further review. According to our PRC Legal Adviser, the entire filing procedure
will normally take three to four months based upon the general practice, based upon which it
is expected that such filing will be completed before September or October 2024.
Based on the reasons above, our Directors are of the view that even if the Interim
Measures on GAI did apply to us, it would not have a material adverse impact on us in material
aspects, and the Sole Sponsor concurs with the Directors’ view based on the reasons above.
SALES AND MARKETING
Sales
We have a highly efficient internal sales team consisted of professional personnel with
work experiences in leading companies in different industries, which is led by our senior
management, who has in-depth insights into the businesses and industries that currently are and
potentially could be empowered by our solutions and rich experiences in serving the
end-customer industries that we focus on. In particular, Mr. Qi SUN, our executive Director
and general manager, has more than 20 year’s experiences spanning a variety of industries in
client management, product commercialization and sales and marketing. Led by Mr. SUN, our
sales team incorporates talents including Mr. Yiqing OUYANG, our deputy general manager,
and other personnel from different levels and across different functional teams, with whom we
proactively conduct sales training to make them familiar with the nature and details of our
solution offerings. Our leadership engages deeply in initially communicating with potential
customers and formulating our marking strategies, and our project teams follow up with such
potential customers to evaluate and address their needs.
Our sales activities are centered on the needs of enterprise-level users. We believe we can
understand their requirements and business development plans firsthand, propose technological
solutions and project plans, and help them solve their problems efficiently. The extensive
industry experiences of our sales force have been essential for the successful adoption and
implementation of our solutions in a wide variety of end-customer industries across different
geographies. Leveraging such experiences, our sales force identifies market trends and user
demand thoroughly and simultaneously works closely with our technology-related departments
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to propose suitable solutions addressing the pain points faced in the relevant end-customer
industries and deliver expectation-met solutions in a timely manner. We build experienced
project-based teams that are knowledgeable about the technological requirements by
participants in the relevant end-customer industries, allowing us to provide our solutions that
directly address user needs. Through development and commercialization of solutions for
similar users, we also leverage synergies across markets to iteratively upgrade and refine our
solutions, thereby creating affordable standardized solutions that also save our sales and
marketing and maintenance expenses to the extent possible. During the Track Record Period,
our customers, including our launch customers, were procured primarily via responding to
invitation to quote or solicitation based upon our wide reputation and industry connections
established through offering enterprise-level communication solutions for nearly two decades,
and also via open tenders, especially when serving the public sector. Such tenders submitted
would then be assessed based upon applicants’ qualifications, skills and experiences to
evaluate if they are capable of fulfilling the requirements as stipulated in the tender documents
together with their tender price. We recognize certain customer as a “launch customer” when
the following criteria have been met: (i) for an enterprise-level user, one that has an
industry-leading position in the end-customer industry that we target to enter, based on its
technological advantages, commercial success, societal recognition or leading market
occupation rate, etc.; and (ii) for a system-integrator, one that serves enterprise-level users with
the said industry-leading position within our target end-customer industry. For details of the
significance of our launch customers in relation to our go-to-market strategies, see “–
Marketing” in this section.
Our in-house sales team interacts closely with our customers to implement our sales plan
and execute the contracts therewith. As our business and customer base grow, we expect to
further expand our sales force to drive new business opportunities. Since we primarily focus
on providing solutions to large-scale organizations, we may spend significant time on customer
communications, project evaluation and design, thereby resulting in longer sales cycles. For
details, see “Risk Factors – Risks Relating to Our Business – Our sales cycle can be length and
unpredictable and requires considerable time and expenses under certain circumstances, and we
may encounter configuration, integration, implementation and customer support challenges
that could affect our results of operations” in this prospectus.
We also work closely with third-party solution business partners, which primarily consist
of system integrators, and leverage their understanding of the end users’ demand, thereby
developing solutions to better serve the latter’s needs. For details, see “– Customers and
Customer Support” in this section.
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Pricing
We price our solutions primarily with cost-based method by taking into consideration
factors such as (i) the number and complexity of the technological segments that the customer
request to be enabled within the solution that it purchased. Our pricing policies are designed
generally to scale proportionately with the number and comprehensiveness of the specific
functional modules required. As the number of such functional modules increases, the overall
complexity and efforts involved in building and delivering the solution accordingly escalates;
(ii) the number and types of hardware component and/or terminal devices that we need to
procure as elements of our solutions, and their costs. For solutions that involve hardware
components such as servers, mobile phones and other edge devices, our pricing takes into
account the volume of equipment required. Additionally, we also consider the complexity of
integrating these devices into the specific on-site infrastructure environment, which may
necessitate tailored configurations and deployment support; and (iii) the extent of incidental
technological functions that require customization and/or maintenance, and the value created.
For instance, if there is any request for customization or adjustment on top of the standardized
solutions, we will evaluate and assess the complexity of such customization. Specifically, when
incidental technological functions or customizations are required, we formulate the budget
based on the number of hours needed for our research and development team to perform
tailored software development, in order to accurately estimate the development efforts
involved. As an alternative, in certain cases where we determine that outsourcing specific
accessory technologies or components to be a more cost-effective and efficient option in the
short term, we will also evaluate the feasibility of integrating third-party technologies into
solution offerings on top of our core technologies. We believe it is crucial to provide our
solutions at competitive prices for our continued success, and it is thus one of our pricing
strategies to conduct market research and evaluate the existing competitors in the markets for
similar application scenarios, comparable offerings and assess the technological sophistication
and advantages of our own solutions.
Our solutions are primarily offered in an outright purchase nature negotiated on a
case-by-case basis. While we try to remain scalable and flexible in our pricing practices, we
will also consider our historical profit margin levels, such as that during the Track Record
Period, as a valuable benchmark for the anticipated level of profitability from each comparable
project to be carried out. Under certain circumstances, especially when we are exploring into
new application scenarios for our solutions, we may price such on a project-by-project basis
by taking into account factors including our expected procurement costs on completing the
project, pricings of our competitors as well as the possibilities of entering into new solution
offering areas.
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Marketing
We believe that our solutions speak for themselves. We are dedicated to creating value for
enterprise-level users of our solutions as we ultimately share their success, which at the same
time allows us to leverage the word-of-mouth referrals by our existing customer and business
partners to achieve organic customer acquisition and to expand our market presence in a
cost-efficient manner.
Our go-to-market strategies start at collaborations with early adopters, such as our launch
customers, in certain end-customer industry we target to enter, which allows us to accumulate
industry expertise and demonstrate the value of our solutions through one or a few entry
projects. Once our value has been proven, we are then able to expand our presence quickly to
cover other quality customers and further penetrate the end-customer industry, without
incurring significant sales and marking expenditures, by leveraging our enriched understanding
of the industry, our reputation established through collaborating with the launch customers, and
our strengthened ecosystem. As such, we have effectively expanded our solution offerings in
different end-customer industries. Simultaneously, our launch customers’ local and global
positioning allows us to expand into the different geographical markets in which they operate.
In addition, we enhance the awareness of new and existing solutions through various
channels, including participation in industry seminars, conferences, forums and salons to
showcase our technological advancements, as well as development of relationships with
industry participants. Furthermore, the various awards, honors and recognitions that we
received from industry organizations and business partners for our technology and
commercialization achievements and sales and marking capabilities also raise our profile with
our potential customers. For details, see “– Awards and Recognitions” in this section.
CUSTOMERS AND CUSTOMER SUPPORT
During the Track Record Period, our customers ranged over different end-customer
industries and we did not rely on customers from any specific end-customer industries. We
mainly had two categories of customers: (i) solution partner customers, who were primarily
third-party system integrators that embedded our solutions into their offerings to cater to
enterprise-level users’ needs; and (ii) enterprise-level users purchasing and using our solutions
directly. Contingent upon the essence of their needs and the scenario-specific deliverables,
certain end users of our solutions use system integrators when selecting suppliers or service
providers to benefit from the various services and/or products integrated by such system
integrators without the necessity of directly negotiating with a large number of such suppliers
or service providers. Such end users typically lay out the goals they plan to achieve and the
budget for their projects and engage third-party system integrators, instead of engaging us
directly. While system integrators do not specialize in developing their own solutions, they
procure hardware and/or software solutions from companies like us, and implement software
plus hardware solutions for end users with uniform standards. System integrators usually
provide various types of assistance in project implementation, such as selecting suppliers,
integrating the work products of different suppliers and managing the implementation.
According to iResearch, it is an industry norm for end users to engage system integrators to
implement their projects. There are no differences in pricing and other material terms between
our contracts entered into with system integrators and that entered into with enterprise-level
users.
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With respect to payment from system integrators, there is not any contractual term under
our agreements with them providing that they would only settle with us after receiving payment
from their end customers or otherwise establishing a direct correlation or dependency between
the two payment streams. Rather, we have the absolute entitlement to payment from the system
integrators within the agree-upon payment terms and conditions once we recognize revenue
upon acceptance thereby. Yet still, the pace at which the system integrators settle with us could
be factually contingent upon the timing of when they receive payments from their end
customers as a matter of commercial consideration and market practice driven by the cash flow
dynamics and operational realities within the value chain. According to the iResearch Report,
since system integrators normally have significant upfront costs associated with integrating,
customizing and deploying their offerings to their end customers, their ability and tendency to
settle timely with their upstream suppliers like us could be impacted by their receipt of
payments from their end customers, which is in line with common practice in the industry.
Given the potential trade receivables collection pressure arising from the abovementioned
business model of selling to system integrators, we have adopted a number of measures to
specifically manage and mitigate this impact, which include that:
 we have implemented rigorous credit evaluation processes for system integrators to
assess their creditworthiness and payment histories. Establishing credit terms based
on the credit risk profile of each system integrator, we regularly monitor and review
their credit exposures and payment performance. We also regularly consult publicly
available information to gather their information and engage in direct dialogue
therewith to stay informed about their operational status;
 we have adopted a detailed due diligence procedure to thoroughly evaluate the
system integrators that we conduct business with to gain better visibility into the
creditworthiness of their end customers. By assessing their customer base, we verify
their track record, reputation, and ability to secure contracts with financially solid
end customers, as well as ensure that they primarily serve large public-sector entities
supported with reliable funding sources and good credit status, well-established
enterprises, or end customers with strong credit histories and financial solvency;
 With respect to the system integrators with considerable outstanding historical trade
balances, we also plan to negotiate more favorable payment terms and consider
requiring partial upfront payments to reduce credit exposure to the extent possible;
and
 we have also been actively diversifying our own customer portfolio by pursuing
direct relationships with enterprise-level users, where appropriate, and reduce any
reliance on a limited number of system integrators, which can further help mitigate
concentration risk and exposure to specific payment practices.
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In addition to the above, our policies and measures to manage our trade receivables apply
to our customer who are system integrators by nature equally. For details, see “Financial
Information – Discussion of Selected Items from Consolidated Statements of Financial
Position – Trade and Other Receivables – Trade Receivables” in this prospectus. By
implementing a combination of these measures, we proactively manage the trade receivables
collection pressure arising from the business model of selling to system integrators, so as to
help improve cash flow management, mitigate credit risks, and ensure a steady liquidity
position.
Although a portion of our customers are our solution partners, which mainly are system
integrators and not the end users, we do not believe that our business model is a distributorship
model, primarily because: (i) as discussed above, solution partners are not distributors that we
engage to broaden our sales channels; instead, they are selected by our end users to implement
their projects, and the ultimate decisions as to which service provider to choose are primarily
made by the end users; and (ii) regardless of whether our contracts were entered into directly
with our end users or with system integrators, there are no material disparity in contract terms
and the scope of our services. Based on the foregoing, we do not believe that system integrators
are our distributors, and we do not believe that our business relationships with them raise any
concern in relation to inventory risk, channel stuffing or cannibalization. Rather, system
integrators’ extensive industry resources and know-how, as well as strong sales capabilities
contribute efficiently to the end users’ deployment of our solutions, and, through cooperating
with system integrators, we can better focus on providing standardized solutions by leveraging
our core technologies. In light of the growing customer base and increasing number of system
integrators therein, our Director confirm that we are not reliant on any particular system
integrators for our revenue growth. The total number of direct customers with whom we
entered into contractual relationships during the Track Record Period amounted to 65, 120 and
199 as of December 31, 2021, 2022 and 2023, respectively.
The value of our contracts with our customers can vary substantially from customer to
customer, depending on their business needs. The salient terms and conditions of our
agreements with customers are set out below:
Deliverables With respect to our software only solutions, we
provide software systems that can be readily
installed onto enterprise-level users’ hardware
equipment. With respect to our software plus
hardware solutions, we also provide hardware
equipment and/or network and other
telecommunication resources in addition to our
software systems bundled as total solution
offerings.
Pricing For more details, see “– Sales and Marketing –
Pricing” in this section.
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Payment Our customer usually pays us upon invoice issued
after its written acceptance of our delivery, and we
may sometimes grant credit terms for certain
customers.
Customer Support We are typically obligated to provide basic
maintenance services accessory to our software
systems under our contracts with our customers. In
very limited circumstances, we charge our customer
separately on maintenance and/or upgrading
services covering some or all of the solutions
purchased under the agreement for the agreed
period after the initial sales. For details, see
“– Customer Support” in this section.
Termination Besides natural expiration upon the contractual
term, the agreement may be terminated by either
party due to the other’s uncured breaches or force
majeure events.
Compliance The customer certifies that all solutions and/or
services will be used in compliance with all
applicable laws and regulations.
Confidentiality Each party shall maintain confidentiality of
information obtained in relation to the relevant
agreement and not to disclose to any third parties,
which shall supersede the expiration of the
agreement.
Top Customers
Sales amount generated from our five largest customers in each year of the Track Record
Period amounted to RMB197.8 million, RMB192.0 million and RMB287.1 million,
respectively, representing 43.0%, 37.2% and 35.4% of our total sales amount for the same
years, respectively; sales amount generated from our largest customer in each year of the Track
Record Period amounted to RMB58.5 million, RMB63.0 million and RMB80.2 million,
respectively, representing 12.7%, 12.2% and 9.9% of our total sales amount for the same years,
respectively.
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The following tables set forth the details of our five largest customers in each year of the
Track Record Period:
Five Largest
Customers for
2021 Company Background Registered Capitals Principal Business
Solutions/Services
Provided by Us
Length of
Relationship Sales Amount
Percentage of
Total Sales
Amount
RMB’000 %
Customer F A Beijing-based
company providing
commercial activities
related services, and
focusing on enterprise
information
management,
customer service,
economic information
consulting and data
processing
RMB80.5 million System integrator Enterprise-level
solutions in
finance industry
Since
December
2017
58,543 12.7
Customer A A Shanghai-based group
providing professional
and technical
services, as well as
software and
information
technology services,
and focusing on IoV
terminal development
and sales, IoV
platform and logistics
information
technology, as well as
IoT technology
Approximately
RMB17.8 million
System integrator Enterprise-level
solutions in city
management and
administration and
automotive and
transportation
Since July
2018
53,825 11.7
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Five Largest
Customers for
2021 Company Background Registered Capitals Principal Business
Solutions/Services
Provided by Us
Length of
Relationship Sales Amount
Percentage of
Total Sales
Amount
RMB’000 %
Customer G A Sichuan-based
company providing
internet infrastructure
installation,
maintenance and other
value-added services,
and focusing on
computer hardware
and software
development, system
integration and other
technical services, as
well as sales of
computer hardware,
software and auxiliary
equipment
RMB45 million System integrator Enterprise-level
solutions in
city management
and administration
Since May
2019
39,474 8.6
Customer H A Sichuan-based
company providing
software and
information
technology services,
and focusing on
software technology
development,
technology consulting
and other internet
services
RMB10 million System integrator Enterprise-level
solutions in
city management
and administration
Since July
2020
23,607 5.1
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Five Largest
Customers for
2021 Company Background Registered Capitals Principal Business
Solutions/Services
Provided by Us
Length of
Relationship Sales Amount
Percentage of
Total Sales
Amount
RMB’000 %
Customer D A Shaanxi-based
company providing
science and
technology promotion
and application
services, and focusing
on network and
information security
software development,
as well as computer
hardware, software
and auxiliary
equipment wholesale
RMB10 million System integrator Enterprise-level
solutions in
city management
and administration
Since
September
2020
22,358 4.9
Total 197,807 43.0
Five Largest
Customers for
2022 Company Background Registered Capitals Principal Business
Solutions/Services
Provided by Us
Length of
Relationship Sales Amount
Percentage of
Total Sales
Amount
RMB’000 %
Customer A A Shanghai-based group
providing professional
and technical
services, as well as
software and
information
technology services,
and focusing
on IoV terminal
development and
sales, IoV platform
and logistics
information
technology, as well as
IoT technology
Approximately
RMB17.8 million
System integrator Enterprise-level
solutions in city
management and
administration
and automotive
and transportation
Since July
2018
62,982 12.2
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Five Largest
Customers for
2022 Company Background Registered Capitals Principal Business
Solutions/Services
Provided by Us
Length of
Relationship Sales Amount
Percentage of
Total Sales
Amount
RMB’000 %
Customer B A Shanghai-based
company providing
software and
information
technology services,
and focusing on
technology
development, transfer,
and consulting
services for network
information,
computers, and
system integration
technologies
RMB15 million System integrator Enterprise-level
solutions in
telecommunications
industry
Since June
2017
50,635 9.8
Customer G A Sichuan-based
company providing
internet infrastructure
installation,
maintenance and other
value-added services,
and focusing on
computer hardware
and software
development, system
integration and other
technical services, as
well as sales of
computer hardware,
software and auxiliary
equipment
RMB45 million System integrator Enterprise-level
solutions in
city management
and administration
Since May
2019
32,402 6.3
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Five Largest
Customers for
2022 Company Background Registered Capitals Principal Business
Solutions/Services
Provided by Us
Length of
Relationship Sales Amount
Percentage of
Total Sales
Amount
RMB’000 %
Customer I/
Supplier A
A major
telecommunications
company in China
focusing on
telecommunications,
radio and television
broadcasting, and
satellite transmission
services, as well as
retailing. Supplier
A/Customer I is listed
on the Stock
Exchange and
Shanghai Stock
Exchange
Approximately
RMB213.0 billion
For details of the
principal business
of Customer I/
Supplier A, see “–
Suppliers and
Procurement –
Top Suppliers” in
this section
Promotion services Since
September
2021
23,351 4.5
Customer J A Sichuan-based
company providing
software and
information
technology services,
and focusing on basic
and value-added
telecommunication
services, and
technology
development,
consulting, transfer
and other services
RMB30 million System integrator Enterprise-level
solutions in
city management
and administration
Since May
2021
22,651 4.4
Total 192,021 37.2
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Five Largest
Customers
for 2023 Company Background Registered Capitals Principal Business
Solutions/Services
Provided by Us
Length of
Relationship
Sales
Amount
Percentage of
Total Sales
Amount
RMB’000 %
Customer A A Shanghai-based group
providing professional
and technical
services, as well as
software and
information
technology services,
and focusing on IoV
terminal development
and sales, IoV
platform and logistics
information
technology, as well as
IoT technology
Approximately
RMB17.8 million
System integrator Enterprise-level
solutions in city
management and
administration and
automotive and
transportation
Since July
2018
80,168 9.9
Customer B A Shanghai-based
company providing
software and
information
technology services,
and focusing on
technology
development, transfer,
and consulting
services for network
information,
computers, and
system integration
technologies
RMB15 million System integrator Enterprise-level
solutions in
telecommunications
industry
Since June
2017
59,450 7.3
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Five Largest
Customers
for 2023 Company Background Registered Capitals Principal Business
Solutions/Services
Provided by Us
Length of
Relationship
Sales
Amount
Percentage of
Total Sales
Amount
RMB’000 %
Customer G A Sichuan-based
company providing
internet infrastructure
installation,
maintenance and other
value-added services,
and focusing on
computer hardware
and software
development, system
integration and other
technical services, as
well as sales of
computer hardware,
software and auxiliary
equipment
RMB45 million System integrator Enterprise-level
solutions in
city management
and administration
Since May
2019
55,394 6.8
Customer L A Beijing-based state-
invested technology
company focusing on
energy informatization
Approximately
RMB230.7 million
Enterprise-level user Enterprise-level
solutions in city
management and
administration
Since May
2023
54,070 6.7
Customer M A Shanghai-based state-
invested company
focusing on radio and
television
broadcasting and
satellite transmission
services
Approximately
RMB45.3 million
System integrator Enterprise-level
solutions in city
management and
administration
Since
January
2023
38,005 4.7
Total 287,087 35.4
In each year of the Track Record Period, our five largest customers listed above used bank
transfer to pay us. For details of our credit terms granted thereto, see “Financial Information
– Discussion of Selected Items from Consolidated Statements of Financial Position – Trade and
Other Receivables – Trade Receivables” in this prospectus. As of the Latest Practicable Date,
none of our Directors, their associates or any of our shareholders (who to the knowledge of our
Directors had owned more than 5% of our issued share capital) had any interest in any of our
five largest customers in each year of the Track Record Period.
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Customer Support
In our ongoing efforts to enhance customer satisfaction and improve service quality, we
maintain a dedicated customer support and service team that is focused on real-time
problem-solving with the ultimate goal of increasing customer experience and stickiness. In
addition, we also gather feedback on how to improve our solutions, respond to customer
suggestions, and take a lifecycle approach to customer support, supporting customers from
onboarding, deployment, system integration, education and training, through maintenance and
upgrades. Our goal is to enable our customers to focus on their business, free from diverting
manpower and financial resources to system maintenance.
Given the highly standardized nature of our solutions, we rely on the expertise of our
project teams and our rigorous quality control procedures to ensure that our solutions are
properly examined before being sold. We are typically obligated to provide basic maintenance
services accessory to our software systems under our contracts with our customers without any
standalone contractual considerations or amounts specifically delineated as part of our total
solution offerings. Moreover, system integrators as our direct customers normally do not
anticipatorily procure from us upgrading services in relation to our software systems under the
contracts pursuant to which we provide such software systems, but rather tend to procure the
upgraded software systems themselves, if any, through entering into new contracts in future.
In very limited circumstances, the contracts provide that our customers will specifically
purchase from us maintenance and/or upgrading services for a minimum period of 12 months,
from which we generated de minimis amounts of revenue that accounted for less than 1% of
our total revenue during the Track Record Period. Our customer support and service team
provides remote customer service 24 hours a day, and our engineers provide both remote and
on-site technical support depending on the complexity of the issue. For issues caused by third
parties, we assist customers with troubleshooting and coordinate with third parties to resolve
the identified issues as fast as we can. Pursuant to the agreement with our third-party vendors
who supply us with certain hardware components that we integrate into our solutions, our
third-party vendors for quality maintenance in case of product defects and typically offer us
full warranty for replacement on the hardware products affected. Such full warranty coverage
typically runs for one to two years from the time of purchase by us. During the Track Record
Period and up to the Last Practicable Date, we had not experienced any complaints that had any
material adverse effect on our brand, business or results of operations, or any material sales
returns or refunds.
SUPPLIERS AND PROCUREMENT
During the Track Record Period, our suppliers consisted primarily of (i) providers of
hardware components such as communication devices, servers and computers that were or are
to be integrated into our solutions; (ii) telecommunications companies with whom we
cooperated for providing network and other telecommunication resources; (iii) providers of
certain non-core and less sophisticated research and development programs; (iv) providers of
cloud services; and (v) our business partners whose software/services were embedded into our
solutions.
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We typically engage reputable suppliers to ensure the quality of our solutions. We have
established a set of internal measures on the evaluation and selection of suppliers by taking into
account various factors, which primarily include (i) technological expertise and capabilities;
(ii) quality of their products/services; (iii) commercial terms offered; (iv) business background,
qualifications, credentials and market reputation; and (v) our project-specific demand. For the
principal hardware components that we need for our software plus hardware solutions, we
generally enter into an agreement with each supplier. The table below sets forth the salient
terms of our typical procurement agreements:
Relationship with Supplier Independent Third Parties and not that of a principal
and an agent.
Purchasing Amount and Pricing The purchasing amount and pricing for each type of
products are subject to negotiation and stipulated in
each agreement.
Transportation and Delivery The specific delivery method is at our choice among
shipment, picking up, etc., subject to our acceptance
of the delivered products.
Payment We usually make payment made and before
delivery.
Product Quality Suppliers are subject to standard quality control
terms specified in each agreement.
For details of our long-term procurement agreement on network resources entered into
with a major telecommunications company in China, see “– Top Suppliers” in this section.
The salient terms of our agreements with our third-party technology service providers
during the Track Record Period are set out below:
Deliverables Our third-party technology service providers are typically required
to complete a technological development project based on our
specific requirements and goals as set forth in the respective
agreement. They shall complete the project within the prescribed
time period, and deliver all relevant research and development
work products and accompanying documents and materials to us,
after which we are generally entitled to technical support and other
auxiliary services.
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Pricing The price of technology services in each contract shall be
determined through arm’s lengths negotiations between us and our
third-party technology service providers, based on the complexity
of the project, the time necessitated for completing the project and
the amount of human and other resources involved, etc.
Payment We typically pay the technology service fees in instalments based
on the progress of the relevant project or pay in full once.
Termination Our technology service agreements may typically be terminated
upon mutual consent between the parties, uncured breach by either
party or force majeure events.
Attribution of IP
results and
other
equipment,
devices or
materials
We are typically entitled to all intellectual properties conceived
and developed during such technological development process,
and have the exclusive right to commercialize or transfer any of
such intellectual properties, including but not limited to the design
drawings, technological secrets, technical materials, documents,
source codes and applications. We are also entitled to all the
equipment, devices or materials purchased or generated in such
process, if any.
Confidentiality Each party shall maintain confidentiality of information obtained
in relation to the relevant agreement and not disclose to any third
parties, which shall typically supersede the expiration or
termination of the respective agreement.
During the Track Record Period and up to the Latest Practicable Date, we had not
experienced any difficulties in procuring our major hardware components and/or other
equipment and had not experienced significant fluctuations in the prices of our supplies. To the
best knowledge of our Directors, there had been no breach of our procurement agreements with
our suppliers during the Track Record Period. While we believe that we have established stable
relationships with our key suppliers, we cannot assure that we will be able to maintain our
working relationships with our major suppliers on similar terms, if at all, and are thus subject
to risks associated with a shortage of qualified equipment and/or services. For risks associated
with our suppliers, see “Risk Factors – Risks Relating to Our Business – Our arrangements
with third-party business partners in our operations reduce our control over the quality,
development and deployment of our solutions and could harm our business” in this prospectus.
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Top Suppliers
Purchase amount from our five largest suppliers in each year of the Track Record Period
amounted to RMB279.0 million, RMB336.0 million and RMB308.0 million, respectively,
representing 72.6%, 65.9% and 63.0% of our total purchase amount for the same years,
respectively; purchase amount from our largest supplier in each year amounted of the Track
Record Period to RMB152.6 million, RMB136.7 million and RMB148.4 million, respectively,
representing 39.7%, 26.8% and 30.4% of our total purchase amount for the same years,
respectively. For details related thereto, see “Risk Factors – Risks Relating to Our Financial
Position and Need for Additional Capital – We had a concentration of suppliers during the
Track Record Period” in this prospectus.
The following table shows the details of our five largest suppliers in each year of the
Track Record Period:
Five Largest
Suppliers for
2021 Company Background Registered Capitals Principal Business
Products/Services
Purchased
Length of
Relationship
Purchase
Amount
Percentage of
Total
Purchase
Amount
RMB’000 %
Supplier A/
Customer I
A major
telecommunications
company in China.
Supplier A/Customer I
is listed on the Stock
Exchange and
Shanghai Stock
Exchange
Approximately
RMB213.0 billion
Telecommunications,
radio and
television
broadcasting, and
satellite
transmission
services, as well
as retailing
Network resources
and
communication
devices
Since
September
2018
152,621 39.7
Supplier B A Guangdong-based
company providing
integrated mobile
phone services.
Supplier B is the
wholly-owned
subsidiary of a
Shenzhen Stock
Exchange listed
company
RMB1.2 billion Telecommunications,
radio and
television
broadcasting, and
satellite
transmission
services
Communication
devices
Since
December
2017
43,452 11.3
Supplier D A Jiangsu-based
company focusing
on the technological
development, retail
and after-sales of
electronic products
RMB50 million Software and
information
technology
services
Communication
devices
Since June
2020
31,024 8.1
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Five Largest
Suppliers for
2021 Company Background Registered Capitals Principal Business
Products/Services
Purchased
Length of
Relationship
Purchase
Amount
Percentage of
Total
Purchase
Amount
RMB’000 %
Supplier F A Hunan-based
company focusing
on the research and
development, sales
and services of
computers and related
products. Supplier F
is the subsidiary of a
Shanghai Stock
Exchange listed
company
RMB20 million Software and
information
technology
services
Hardware, software
and/or other
services
Since
September
2021
26,419 6.9
Supplier E A Guangdong-based
company focusing
on rental and sales of
electronic products.
Supplier E is the
subsidiary of a
Shenzhen Stock
Exchange listed
company
RMB50 million Wholesale Communication
devices
Since June
2020
25,505 6.6
Total 279,021 72.6
Five Largest
Suppliers for
2022 Company Background Registered Capitals Principal Business
Products/Services
Purchased
Length of
Relationship
Purchase
Amount
Percentage of
Total
Purchase
Amount
RMB’000 %
Supplier A/
Customer I
A major
telecommunications
company in China.
Supplier A/Customer I
is listed on the Stock
Exchange and
Shanghai Stock
Exchange
Approximately
RMB213.0 billion
Telecommunications,
radio and
television
broadcasting, and
satellite
transmission
services, as well
as retailing
Network resources,
communication
devices and
other services
Since
September
2018
136,682 26.8
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Five Largest
Suppliers for
2022 Company Background Registered Capitals Principal Business
Products/Services
Purchased
Length of
Relationship
Purchase
Amount
Percentage of
Total
Purchase
Amount
RMB’000 %
Supplier F A Hunan-based
company focusing on
the research and
development, sales
and services of
computers and related
products. Supplier F
is the subsidiary of a
Shanghai Stock
Exchange listed
company
RMB20 million Software and
information
technology
services
Hardware, software
and/or other
services
Since
September
2021
58,199 11.4
Supplier G A Shandong-based
company providing
supply chain
management and
technical development
and consulting
services
RMB50 million Warehouse loading
and unloading
services
Servers Since
September
2021
56,142 11.0
Supplier H A Tianjin-based
company focusing the
sales of electronic
products
RMB200 million Retailing Communication
devices
Since July
2020
53,416 10.5
Supplier I A Jiangsu-based
company providing
advertisements design,
agency, production
and publication, and
public relations
services
RMB10 million Commercial
services
Promotion services Since
October
2020
31,530 6.2
Total 335,969 65.9
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Five Largest
Suppliers
for 2023 Company Background Registered Capitals Principal Business
Products/Services
Purchased
Length of
Relationship
Purchase
Amount
Percentage of
Total
Purchase
Amount
RMB’000 %
Supplier A/
Customer I
A major
telecommunications
company in China.
Supplier A/Customer I
is listed on the Stock
Exchange and
Shanghai Stock
Exchange
Approximately
RMB213.0 billion
Telecommunications,
radio and
television
broadcasting, and
satellite
transmission
services, as well
as retailing
Network resources,
communication
devices and
other services
Since
September
2018
148,414 30.4
Supplier E A Guangdong-based
company focusing
on rental and sales of
electronic products.
Supplier E is the
subsidiary of a
Shenzhen Stock
Exchange listed
company
RMB50 million Wholesale Communication
devices
Since June
2020
57,803 11.8
Supplier B A Guangdong-based
company providing
integrated mobile
phone services.
Supplier B is the
wholly-owned
subsidiary of a
Shenzhen Stock
Exchange listed
company
RMB1.2 billion Telecommunications,
radio and
television
broadcasting, and
satellite
transmission
services
Communication
devices
Since
December
2017
37,107 7.6
Supplier S A Shandong-based
company focusing on
the construction of
industry internet
infrastructure and
digitalization of the
manufacturing
industry
RMB200 million Research and testing
development
services
Servers and other
services
Since June
2023
36,870 7.5
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Five Largest
Suppliers
for 2023 Company Background Registered Capitals Principal Business
Products/Services
Purchased
Length of
Relationship
Purchase
Amount
Percentage of
Total
Purchase
Amount
RMB’000 %
Supplier Q A Shanghai-based
company focusing on
the research and
development, sales
and services of
computers and related
products
RMB10 million Software and
information
technology
services
Communication
devices and
servers
Since
December
2020
27,773 5.7
Total 307,967 63.0
Our largest supplier in each year of the Track Record Period, Supplier A, is a major
telecommunications company in China, from which we procured network resources, WiFi
coverage and related services for our city management and administration projects. We entered
into a long-term procurement agreement with Supplier A, the salient terms of which are set out
below:
Term 8 years from 2018 to 2026
Purchase Amount Approximately RMB850.0 million
Payment By 19 installments from 2018 to 2026
Termination Besides natural expiration upon the contractual term and
termination upon mutual consent, the agreement may be
terminated by either party due to the other’s uncured breaches
City management and administration projects usually involve the establishment of an
intelligent town cluster where the infrastructure, administration, and various businesses of
hundreds of towns are being unified and integrated into one cloud-based platform. Network
resources are fundamental resources for enterprise-level participants in city management and
administration projects. Our long-term cooperation with Supplier A provides us with
large-scale and stable network resources at favorable rates. We use the network resources to
empower our solution offerings and facilitate other enterprises’ participation and cooperation
with us in city management and administration projects. We also benefit from such network
resources in the acquisition of new customers in city management and administration.
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During the Track Record Period and up to the Latest Practicable Date, we did not have
any material disputes with Supplier A relating to the performance of the above procurement
agreement, and we expect to maintain close and stable cooperation relationship with Supplier
A in the foreseeable future. Upon expiration of the procurement agreement, we will discuss
future cooperation with Supplier A based on our then business needs, and we believe that we
can acquire similar network services at comparable costs in the future. Our Directors are of the
view that we would be able to engage similar suppliers at comparable costs if the
aforementioned procurement agreement with Supplier A was terminated or expired, given the
network resources transacted thereunder being available from other similar
telecommunications companies, as well as our large-volume need for the same.
During the Track Record Period, our aforementioned procurement of network resources
from Supplier A took up most of our purchase amount therefrom, which amounted to
RMB152.6 million, RMB136.7 million and RMB148.4 million in each year, in addition to
procurement of hardware devices integrated into our solutions under separate procurement
agreements. While such purchase amount was summarized by payment amount stipulated by
the terms of the aforementioned long-term procurement agreement, the relevant procurement
costs were expensed into our cost of revenue on a straight-line basis according to our
accounting policies. It is primarily due to such reason that the network and other
telecommunication resource costs under our cost of revenue remained largely the same from
2021 to 2023, but our purchase amount from Supplier A fluctuated during the same years. For
details of the breakdown of our cost of revenue by nature, see “Financial Information –
Description of Selected Components of Consolidated Statements of Profit or Loss – Cost of
Revenue” in this prospectus.
In each year of the Track Record Period, we used bank transfer to pay our five largest
suppliers listed above, and they settled with us on a delivery upon receipt of payment basis. As
of the Latest Practicable Date, none of our Directors, their associates or any of our shareholders
(who to the knowledge of our Directors had owned more than 5% of our issued share capital)
had any interest in any of our five largest suppliers in each year of the Track Record Period.
OVERLAPPING CUSTOMERS AND SUPPLIERS
Our largest supplier in each year of the Track Record Period, Supplier A, was also one of
our five largest customers in 2022. During the Track Record Period, purchase amount from
Supplier A in each year amounted to RMB152.6 million, RMB136.7 million and RMB148.4
million, respectively, representing 39.7%, 26.8% and 30.4% of our total purchase amount for the
same years, respectively; sales amount generated from Supplier A in each year amounted to
RMB3.1 million, RMB23.4 million and RMB10.3 million, respectively, representing 0.7%, 4.5%
and 1.3% of our total sales amount for the same years, respectively. During the Track Record
Period, we primarily purchased from Supplier A network resources for our city management and
administration projects, as well as communication devices and other services integrated into our
solutions. Our sales to Supplier A during the Track Record Period were primarily in relation to
the promotion services that we provided for it. For details, see “Business – Our Solution
Offerings” in this prospectus.
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According to the iResearch Report, it is not uncommon for the enterprise-level
conversational AI solution market in China to have overlapping customer-supplier
relationships, considering that major participants within the enterprise-level conversational AI
industry value chain, such as telecommunications companies and automobile companies, not
only act as the primary suppliers for hardware components including communication devices,
computers, network resources and vehicles, etc., necessary for offering integrated
conversational AI solutions, but are also in need of enterprise-level conversational AI solutions
themselves to improve their internal operational efficiency or empower users of their services
and/or products. Our Directors confirm that each of our sales to and our purchases from the
aforementioned overlapping customers-supplier were negotiated and conducted separately
under normal commercial terms. Our Directors are of the view that such arrangements are
mutually beneficial, given that we transacted with such customers-suppliers on an arm’s-length
basis. To the best knowledge and belief of our Directors, the aforementioned overlapping
customers-supplier is an Independent Third Party. As of the Latest Practicable Date, none of
our Directors, their associates or any of our Shareholders (who to the best knowledge of our
Directors had owned more than 5% of our issued capital) had any interest in the
aforementioned overlapping customers-supplier. Save as disclosed above, to the best
knowledge of our Directors, we did not have any other overlap between our major customers
and suppliers, during the Track Record Period.
LOGISTICS AND INVENTORIES MANAGEMENT
With respect to our solutions that combine software and hardware, the hardware
components are typically directly delivered by the hardware component vendors to us, which
are then configured and tested by us before delivering the software plus hardware solutions.
During the Track Record Period, our inventories primarily included communication
devices, servers and computers, and perception equipment and accessories that were or are to
be integrated into our solutions. As of December 31, 2021, 2022 and 2023, we had inventories
of RMB112.5 million, RMB95.3 million and RMB6.2 million, respectively. We adopt a strict
inventories control policy in place to monitor our stock levels and regularly track our
inventories to keep them at a level sufficient to fulfill the orders. Our personnel responsible for
supply management review the ageing of our inventories, prepare aging reports routinely and
take necessary actions to minimize risks of obsolescence. In addition, we will from time to time
review and make sufficient provisions if needed. Nevertheless, we may from time to time be
subject to risks relating to the level of our inventories that we maintain. For details, see “Risk
Factors – Risks Relating to Our Financial Position and Need for Additional Capital – We face
risks of overstocking or under-stocking inventories” in this prospectus. During the Track
Record Period, we did not procure hardware that was sourced from the U.S. and/or consisted
of components which had embedded technologies originated from the U.S., other than
consumer goods used internally or integrated into our solutions, including mobile phones,
laptops, smart watches, tablets, and accessories (earphones, power adapters, etc.), as well as
ordinary computer hardware including random-access memory (RAM) and servers. Our
directors confirm that we would not face difficulty in procuring such consumer goods from
origins other than the U.S., and there are plenty of alternatives of the same originated from the
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PRC and other overseas countries to which we have access. Our access to such products and/or
costs in procuring the same may be impacted by the trade war between the U.S. and other
countries. For details, see “Risk Factors – Risks Relating to Our Business – The changes in
international political relationships, trade policies and trade barriers, or the escalation of trade
tensions, may have an adverse effect on our business operations” in this prospectus.
QUALITY CONTROL
We are committed to providing our solutions of consistently high quality. In compliance
with industry standards, we have established a quality management system and formulated a
set of quality control measures to closely monitor and standardize our full research-to-
production cycle, including supervising the solution design process, managing solution
requirement documents, specifying design and technology requirements for solution research
and development, and handling solution defects. Our quality control and risk control staff
closely monitor our operation process so as to make sure that our quality control measures are
effectively implemented and we will keep upgrading our quality control system in course of
future developments of our solutions. In addition, we have obtained multiple professional
qualifications, which laid a solid foundation for the consistent delivery of high-standard
solutions. We have registered ISO9001 (Quality Management System) and have been appraised
at Capability Maturity Model Integration (CMMI V2.0) Level 3 Maturity for Development.
COMPETITION
We face competition especially in China’s full-stack enterprise-level conversational AI
solution market from other solution providers, in which the competition is primarily centered
upon the providers’ one-stop service capability, application-scenario expansion capability,
service depth, delivery selectability, cost efficiency realized for users, and device
compatibility. We face competitions from other companies that have transitioned from
communication technology services to AI research and development and thus have full-stack
service capabilities, traditional communication technology service companies, intelligent
speech and semantic companies, and general AI companies. In addition, new and enhanced
technologies may further increase competition in our industry. For details of the competitive
landscape of the market in which we compete, see “Industry Overview – Market of IT
Solutions Empowered by Conversational AI & UC in China – Market of Full-Stack
Enterprise-Level IT Solutions Empowered by Conversational AI & UC in China – Competitive
Landscape” in this prospectus. Leveraging our technologies, we believe we are well positioned
in such market competition. For details, see “– Our Competitive Strengths” in this section.
With the introduction of new technologies and entry of new market participants, we
expect the competition that we face to continue to intensify in the future. Moreover, some of
our competitors may have greater resources, longer corporate operating history, or broader
customer base and relationships than us. For details of the risks relating to the fierce
competition that we face, see “Risk Factors – Key Risks Relating to Our Business, Industry,
Regulatory Compliance, General Operations and Financial Prospects – As the industry in
which we operate is highly competitive, our results of operations could be harmed if we do not
effectively compete against our current or future competitor, which may particularly include
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major technology giants and cloud service companies” in this prospectus. In addition, we also
face competition for highly skilled personnel, including management, software engineers and
other research and development and sales and marketing staff with in-depth industry
know-how. Our growth depends in part on our ability to retain our existing personnel and
attract additional highly ones. For details, see “Risk Factors – Risks Relating to Our Business
– Our business depends substantially on continuing efforts of our senior management, core
technical personnel and other key staff, as well as a competent pool of talents supporting our
existing operations and further growth. If we are unable to retain, attract, recruit and train such
personnel, our business and future prospects may be materially and adversely affected” in this
prospectus.
INTELLECTUAL PROPERTY
Our intellectual property is critical to our innovation which underpins our success. We
rely on a combination of patents, copyrights, trademarks, domain names, trade secrets and
other proprietary rights protection laws, as well as contractual provisions, to protect our
intellectual property. We have designed and adopted comprehensive measures to protect our
intellectual property. For instance, we strive to make timely registrations, filings and
applications for our intellectual property rights. Further, we require our employees to enter into
standard employment contracts that include confidentiality clauses and intellectual property
ownership clauses stipulating that all patents, trademarks and any other intellectual property
developed by them during their employment with us are our properties. For details of our
material intellectual property rights, see “Appendix VI – Statutory and General Information –
B. Further Information About the Business of the Company – 2. Our Material Intellectual
Property Rights” to this prospectus.
As of the Latest Practicable Date, we had not been subject to any material disputes or
claims for infringement upon third parties’ intellectual property rights. Notwithstanding the
fact that we intend to protect our intellectual property rights vigorously, there can be no
assurance that our efforts will be successful. Unauthorized use of our intellectual properties by
third parties and expenses incurred to protect our intellectual property rights may materially
and adversely affect our business and operations. For details, see “Risk Factors – Risks
Relating to Our Business – We may be unable to obtain, maintain and protect our intellectual
property rights and proprietary information or prevent third parties from any unauthorized use
of our technologies” in this prospectus. Moreover, third parties may from time to time initiate
litigations or other legal proceedings against us alleging infringement of their proprietary
rights or otherwise challenging the validity of our intellectual property rights. For details, see
“Risk Factors – Risks Relating to Our Business – We may be subject to intellectual property
infringement claims, which could be time-consuming and costly to defend and may result in
diversion of our financial and management resources” in this prospectus.
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ENVIRONMENTAL, SOCIAL AND GOVERNANCE MATTERS
Making a positive environmental, social and governance (“ ESG”) impact on our
communities is an integral part of our business and essential to our sustainable development.
We are committed to being a responsible corporate citizen, abiding by applicable laws and
generally accepted ethical principles, and increasing the wellness of the society. As we vision
ourselves to provide solutions that catalyze progression of society and facilitate
communications among various enterprises, organizations and individuals, we attach great
importance to ESG matters. Leveraging our technologies, we thrive for creating sustainable
value for our business partners, customers, investors, employees and society, hence building a
healthy, vibrant and sustainable ecosystem.
During the Track Record Period and up to the Latest Practicable Date, we had not been
subject to any fines or other penalties due to non-compliance in relation to health, work safety
or environmental laws and regulations and had not had any accident, or received any claim for
personal or property damage made by our employees which had materially and adversely
affected our financial condition or business operations. During the Track Record Period and up
to the Latest Practicable Date, as confirmed by our PRC Legal Adviser, we had complied with
the applicable PRC laws, regulations and rules relating to resources consumption and
environmental protection in all material respects. Our Directors considered that the annual
costs for compliance with the applicable health, work safety or environmental laws and
regulations were not material during the Track Record Period and we do not expect such costs
to be material going forward.
Governance on ESG Matters
Our ESG policies primarily focus on areas such as environmental impacts, employment
safety and social responsibilities, and we believe we have adequate policies ensuring
compliance with laws and regulations thereon. Our Board of Directors has the collective
responsibility for formulating, adopting and reviewing our ESG vision, policies and targets,
and regularly evaluating, determining and addressing our ESG-related risks and opportunities.
Under the oversight of our Board of Directors, our management actively identifies and
monitors the actual and potential impact of ESG-related risks and opportunities on our
business, strategy and financial performance, and incorporates such consideration thereinto.
Our management will assess the likelihood of ESG-related risks occurring and the estimated
magnitude of any potential impact. Our management may engage independent third party(ies)
to evaluate our ESG-related risks and review our existing strategy, target and internal controls,
and improvement will then be implemented to mitigate the risks. As part of our efforts to
promote corporate social responsibility and sustainable development, we are in the process of
optimizing our ESG policies and plan to establish an ESG working group responsible for
overseeing and guiding our ESG initiatives pursuant to our internal control policies. We aim
to officially adopt our ESG policies and establish our ESG working group upon the Listing.
When necessary, we may also identify, assess, manage and mitigate ESG-related risks by
setting up dedicated project task forces that will report to our ESG committee regularly.
Moreover, we may engage professional external ESG consultants to help us establish and
improve our ESG policies and standards.
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Environmental Impacts and Protection
Given that we operate our business primarily in the office, we do not operate any
production facilities but instead conduct a majority of our operations online, which we believe
does not impose material threats to the environment or the climate. Therefore, we are not
subject to significant environmental risks, and do not expect that we will incur any material
liabilities in this regard that would have any material adverse impact on our business and
results of operations.
Nonetheless, we have made significant efforts towards environmental protection and
energy efficiency. We intend to develop solutions aiming to help enterprises and other
organizations across various end-customer industries enhance the effectiveness for
communications and thereby enable greater sustainability.
Metrics and Targets
We have assessed quantitative information that reflects our management of ESG-related
risks, which primarily includes greenhouse gas (“ GHG”) emissions and energy consumption.
While our GHG emissions and energy consumption increased during the Track Record Period
along with the growth of our business scale, we do not involve in material emissions or
consumption due to our business nature. Besides, given that substantially all of our operations
are carried out in the office, the individual water consumption wherein by our employees from
office facilities are generally included in the management fee or complimentary, and there were
thus no available records during the Track Record Period. Considering the sporadic nature of
water consumption in association of our operations, our Directors are of the view that the
wastewater generated therefrom is relatively limited. We adhere to and appreciate the
importance of integrating green development into daily operation, aiming at conducting our
business in an environmentally friendly manner. To move forward with the goals, we will adopt
resource conservation management policies and encouraging resource consumption efficiency
and saving behaviors among our employees during our daily operations to further reduce water
consumption.
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Our GHG emissions are consisted principally of scope 1 direct GHG emissions resulting
from burning of fuels in vehicles, scope 2 indirect GHG emissions resulting from purchased
electricity and scope 3 other indirect emissions resulting from business travel by employees.
The following table sets forth the breakdown of our estimated GHG emissions in each year of
the Track Record Period:
Y ear ended December 31,
2021 2022 2023
GHG emissions
Scope 1 direct emissions (tonnes
CO2 equivalent) 6.3 5.7 4.3
Scope 2 indirect emissions (tonnes
CO2 equivalent) 32.6 43.3 74.0
Scope 3 other indirect emissions* (tonnes
CO2 equivalent) 22.4 15.0 56.3
Total GHG emissions (tonnes
CO2 equivalent) 61.3 64.0 134.6
Overall GHG emissions intensity (tonnes
CO2 equivalent/revenue RMB’000) 0.000133 0.000124 0.000166
Note:
* Best estimates based upon air travel made by our employees that were job-related according to our
internal booking record
The following table sets forth the breakdown of our energy consumption in each year of
the Track Record Period:
Y ear ended December 31,
2021 2022 2023
Energy consumption
Electricity consumption (kWh) 53,465.0 71,034.4 121,318.2
Electricity consumption intensity
(kWh/revenue RMB’000) 0.12 0.14 0.15
Our electricity consumption and electricity consumption intensity increased significantly
during the Track Record Period, primarily due to the incorporation of various subsidiaries
under our Group and thus our expanded operational scales, which also contributed to the
significant increase in our total GHG emissions and overall GHG emissions intensity during
the same years. Our GHG emissions resulting from business travel by employees increased in
2023 as compared with 2022, which was in line with the expansion of our business presence
into wider geographical areas and hence the greater travel needs. The decrease in such
emissions in 2022 in comparison with 2021 was mainly a result of the impact of COVID-19.
We will make continuous efforts in effectively managing the level of our annual GHG
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emissions and energy consumption. Our Board will set targets at the beginning of each
financial year in accordance with the disclosure requirements of Appendix C2 to the Listing
Rules and other relevant rules and regulations upon the Listing. The relevant targets will be
reviewed on an annual basis to ensure that they remain appropriate to our needs. In setting the
ESG-related targets, we will take into account not only our historical discharge or consumption
levels, but also our future business expansion in a thorough and prudent manner with a view
of balancing business growth and environmental protection to achieve sustainable
development. Specifically, we aim to continuously manage the level of our energy consumption
which contributed primarily to our GHG emissions during the Track Record Period, ultimately
towards the target of limiting the increase in our GHG emissions by not more than 20% in 2025
as compared to our overall GHG emissions intensity in 2022. In addition, we also aim to
implement sustainable and environment-friendly practices to reduce the carbon emission,
energy consumption and other environmental impacts arising from our business operations,
including: (i) conducting trainings and remainders for our employees on electricity and paper
saving, such as turning off unnecessary air conditioning, lighting and power equipment in a
timely manner when the devices are not in operation and before they leave the premises, and
waste classification and recycling; (ii) arranging daily inspections of office areas to save
electricity energy; (iii) encouraging low-carbon and environmentally friendly travel; (iv)
actively digitalizing our business and promoting a paperless office where double-sided printing
is encouraged with respect to documents that must be printed; and (v) setting up waste sorting
containers separately so as to recycle and/or re-use used batteries and papers, among other
work wastes, to the extent possible. We are dedicated to enhancing the efficiency of electricity
and water consumptions in our operations to fulfill our environmental and social responsibility.
By the end of December 2023, our AI empowerment computing center had run online
through certain third-party provider of server hosting services, and the power consumption
therefrom was insignificant during the Track Record Period. However, in anticipation of the
increase in such power consumption to enable the required computing needs, we have been
formulating plans on energy-saving and environmental protection, which will be implemented
once the computing center is being formally operated. Specifically, we will implement
energy-saving power consumption systems to set energy-saving targets regularly. For instance,
we will use “power usage effectiveness” (PUE) to evaluate the energy consumption efficiency
of the computing center, which equals the total energy consumption from the operation of the
computing center divided by energy consumption generated from IT equipment. As a PUE
figure closer to one indicates less non-IT equipment related energy consumption and thus
higher efficiency, we currently expect an average PUE around 1.3977 annual at the computing
center. We will strive to achieve such targets through various measures to optimize the use of
equipment and other facilities via technologies on waste heat recovery, indirect evaporative
cooling and improvement of heat dissipation system, etc. We will also encourage our
employees to adopt energy-saving practices comprehensively. In addition, we expect to use
renewable energy as much as possible to power the operation of the computing center. We will
actively seek out opportunities to source electricity from clean energy sources such as solar
energy to reduce our carbon footprint. Same as other ESG-related risks and opportunities, our
management will conduct regular environmental impact assessments to identify potential risks
related to the operation of the computing center and implement measures to mitigate them, so
as to ensure that it is being operated in an environmentally responsible manner.
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Employment Safety
We do not operate any production facilities, and are therefore not subject to significant
health, work or safety risks. To ensure compliance with applicable laws and regulations, our
human resources team would, if necessary, adjust our human resources policies from time to
time to accommodate material changes to relevant labor and safety laws and regulations.
Furthermore, as we believe that having a balanced lifestyle is crucial to achieving a good
mindset at work, we encourage employees to maintain good mental and physical health by
participating in sports and recreational activities. With respect to our safety policy, we require
all employees to follow our safety rules and receive safety training, which includes fire drills
and videos on evacuation as well as other fire safety measures.
Social Responsibilities
Corporate social responsibility is viewed as part of our core growth philosophy that will
be pivotal to our ability to create sustainable value by embracing diversity and public interests.
In respect of social responsibility policies, we are committed to cultivating a collaborative
company culture that inspires teamwork. We value the contribution of each employee in
different roles and strive to provide a fair and balanced compensation scheme that offers proper
incentives. We also encourage our employees to treat each other with care and respect and to
feel cared and respected. We will continue to foster a positive working atmosphere while
enhancing equal job opportunities for all.
We hire employees based on their merits and it is our corporate policy to offer equal
opportunities to our employees regardless of gender, age, race, religion or any other social or
personal characteristics, and provide training programs to keep our employees abreast of
industry and regulatory developments. We will also continue to invest in the training and career
development of our employees covering corporate culture, employee rights and
responsibilities, job performance, technical skills and safety management.
In addition, we are committed to corporate responsibility projects through charitable
endeavors. For instance, in 2021, we made donations to an elderly care home in Shanghai
through a charitable organization for upgrading its shower facilities so as to fulfill our social
responsibilities for the underprivileged in our local communities. Also, we participated in an
east-west collaboration initiative between Minhang District, Shanghai and Yun County,
Yunnan, and have made donations to the villages within the county since 2021, which were
used for constructions of the living, production and recreational equipment and facilities there.
Our fulfilling social responsibilities also lies in our empowerment of various city
administrative projects that help improve social life and security. For details, see “– Our
Solution Offerings – V oicecomm Solutions – City Management and Administration” in this
section.
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Climate Change
Due to the nature of our business, we had not experienced any material impact on our
business operations, strategies or financial performance as a result of climate-related incidents
as of the Latest Practicable Date. However, we recognize the importance of the identification
and mitigation of significant climate-related issues and are committed to managing the
potential climate-related risks which may impact our business activities.
Specifically, we have identified potential risks from the climate change that may have
potential implications on our business and general operations. For instance, our business may
potentially be negatively impacted under extreme weather events as the safety of our
employees will be threatened and the power grid or communication infrastructures may be
damaged, which will expose us to risks associated with nonperformance or delayed
performance of our solutions. Extreme weather may also cause disruptions for our suppliers,
which may in turn adversely impact our ability to provide on-premises deployment or technical
support for our customers. To minimize the potential risks and hazards, our management will
actively respond to the relevant policies of local governments, make contingency plans to
ensure the safety of our staff. In the case of acute physical risks such as direct damage to assets
and indirect impacts from supply chain disruption as a result of extreme weather events, we
will also make the corresponding disaster preparedness plans. In any event, we will explore
emergency plans to further reduce our venerability to extreme weather events in order to
enhance business robustness.
In addition, we expect changes of the regulatory, technological and market landscape in
the course of achieving the global vision on carbon neutrality, due to climate change, including
the tightening of national policies and applicable listing rules and the emergence of
environmentally related taxes. Stricter environmental laws and regulations may expose us to
higher risks of claims and lawsuits, which might incur additional compliance costs and affect
our reputation. In anticipation of the potential policies and legal risks as well as the
reputational risks, our management constantly monitors any changes in laws or regulations and
national and international trends on climate change to avoid cost increments, non-compliance
fines or reputational damages due to delayed response.
EMPLOYEES
As of December 31, 2023, we had 319 full-time employees, the majority of which were
based in our headquarter in Shanghai. The following table sets forth the number of our
full-time employees by function as of December 31, 2023:
Function
Number of
Employees % of Total
Management 6 1.9
Research and Development 215 67.4
Marketing, Finance, General Administrative,
Project Implementation and Solution Support 98 30.7
Total 319 100.0
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Our success depends on our ability to attract, recruit, retain and motivate qualified
personnel, and we believe that our high-quality talent pool is one of our core strengths. We
adopt high standards and strict procedures in our recruitment to ensure the quality of new
hiring and use various methods for our recruitment, including campus recruitment, online
recruitment, internal recommendation and recruiting through executive search, to satisfy our
demand for different types of talents.
We provide regular and specialized training tailored to the needs of our employees in
different departments. Our employees can also improve their skills in the course of the research
and development and commercialization of our solutions and through mutual learning among
colleagues. New employees will receive pre-job training and general training. In addition, we
regularly evaluate the performance of our employees and reward those who perform well with
higher compensation or promotion.
In compliance with the relevant PRC labor laws, we enter into standard employment
contracts with our employees covering matters such as terms, wages and bonuses, employee
benefits, confidentiality obligations and grounds for termination. We are required under the
applicable PRC laws and regulations to contribute to employee social insurance and housing
provident funds at specified percentages of the salaries, bonuses and certain allowances of our
employees up to a maximum amount specified by the local governments from time to time. As
advised by our PRC Legal Adviser, if any of the relevant social insurance authorities is of the
view that we have failed to make full social insurance contributions for our employees in
accordance with the relevant laws and regulations, it may order us to pay outstanding amounts
within a prescribed time limit and subject us to a late charge at the daily rate of 0.05% on the
outstanding amounts from the date on which such amounts are payable. If such payment is not
made within the prescribed period, the relevant authorities may further impose a fine one to
three times the amount of any overdue payment. In addition, if any of the relevant housing
provident fund authorities is of the view that we have failed to make full housing reserve fund
contributions for our employees in accordance with the relevant laws and regulations, it may
order us to make the outstanding payment within a prescribed time limit. If the payment is not
made within such time limit, an application may be made to PRC courts for compulsory
enforcement.
We had historically engaged third-party human resource agencies to make contributions
to social insurance and housing provident funds for our employees during the Track Record
Period. Based upon the fact that we obtained official written letters from the competent social
insurance and housing fund authorities, confirming that no administrative penalty had been
imposed on us for violating any applicable laws or regulations during the Track Record Period,
our PRC Legal Adviser is of the view that our historical contributions to the relevant
employees’ social insurance and housing provident funds through third-party human resource
agencies had not violated the relevant PRC laws and regulations in material aspects,
considering that (i) we had undertaken to timely rectify in the event that we were ordered to
pay social insurance and housing provident funds for our employees through our own accounts;
(ii) starting from November 2023, we have fully rectified the matter by entering into
termination agreements with the relevant third-party human resource agencies and making
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contributions to employee social insurance and housing provident funds completely by
ourselves going forward; (iii) the employees for whom we paid social insurance and housing
provident funds through third-party human resource agencies have confirmed that they agree
with such arrangements and will not claim any responsibility against us; and (iv) we had not
received any notice from any relevant government authorities, as of the Latest Practicable
Date, requiring us to rectify or subjecting us to any penalties for engaging third-party human
resource agencies.
As of the Latest Practicable Date, our employees were not represented by any labor union.
We believe that we maintain a good working relationship with our employees, and, during the
Track Record Period and up to the Latest Practicable Date, we had not experienced any
material disputes with our employees.
INSURANCE
We consider our insurance coverage to be adequate as we have in place all the mandatory
insurance policies required by PRC laws and regulations and in accordance with the
commercial practices in our industry. Our employee-related insurance consists of pension
insurance, maternity insurance, unemployment insurance, work-related injury insurance and
medical insurance, as required by PRC laws and regulations, and we also purchase
supplemental commercial medical insurance for our employees. In addition, we maintain
property insurance for our machines, equipment and furniture, among other fixed assets, as
well as public liability insurance.
In line with general market practice, we do not maintain any business interruption
insurance, key man life insurance or insurance policies covering damages to our network
infrastructures or information technology systems which are not mandatory under PRC laws or
regulations. For details, see “Risk Factors – Risks Relating to Our General Operations – Our
insurance coverage may be limited and expose us to significant costs and business disruption”
in this prospectus.
PROPERTIES
According to section 6(2) of the Companies (Exemption of Companies and Prospectuses
from Compliance with Provisions) Notice and Chapter 5 of the Listing Rules, this prospectus
is exempted from compliance with the requirements of section 342(1)(b) of the Companies
(Winding Up and Miscellaneous Provisions) Ordinance in relation to paragraph 34(2) of the
Third Schedule to the Companies (Winding Up and Miscellaneous Provisions) Ordinance,
which requires a valuation report with respect to all our interests in land or buildings, for the
reason that, as of December 31, 2023, none of the properties leased by us had a carrying
amount of 15% or more of our total assets.
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Our corporate headquarter is located in Shanghai, China. As of the Latest Practicable
Date, we did not own any properties, and leased ten properties in Shanghai, Shandong, Jiangsu,
Chongqing, Beijing, Hainan and Sichuan, with an aggregate gross floor area of approximately
13,103.22 sq.m.. The following table sets forth the details of properties leased by us as of the
Latest Practicable Date:
No. Location Usage Leased Area End of Lease Term
(Approximate sq.m.)
1. Shanghai Office, R&D 1,099.13 March 14, 2027
2. Zibo, Shandong Office, R&D 855.71 June 30, 2027
3. Suzhou, Jiangsu R&D 410.00 February 28, 2025
4. Nanjing, Jiangsu Office 118.51 May 31, 2026
5. Chongqing Office 236.00 June 5, 2025
6. Shanghai Office, R&D 186.50 April 30, 2026
7. Beijing Office 15.00 April 27, 2025
8. Zibo, Shandong Office 9,551.47
(1) February 22, 2025
9. Haikou, Hainan Office 501.44 June 30, 2024 (2)
10. Chengdu, Sichuan Office 129.46 July 23, 2025
Notes:
(1) As of the Latest Practicable Date, we planned to use the building as a facility for customer services
pursuant to our cooperation with the local governmental entity. For details, see “– Our Technologies –
AI Technologies – AI Empowerment Computing Center” in this section.
(2) While the lease agreement was entered into in May 2023, we only started to use the leased property after
August 2023 by staffing our personnel on-site.
In the event that any of our leases expire after the end of their respective lease term, we
would need to seek alternative premises and incur relocation costs. We believe that there are
alternative properties at comparable rental rates available on the market, the use of which
would not materially and adversely affect our business operations, and we thus do not rely on
the existing leases for our business operations. For details of the risks with respect to our leased
properties, see “Risk Factors – Risks Relating to Our General Operations – Failure to renew
our current leases at reasonable terms or to locate desirable alternatives for our offices and
facilities could materially and adversely affect our business and results of operations” in this
prospectus.
As of the Latest Practicable Date, our aforementioned leased properties in China had not
been registered with the relevant PRC governmental authorities, as the relevant registering
procedures require cooperations by the respective lessor. According to our PRC Legal Adviser,
the failure to do so does not in itself invalidate the leases, but we may be ordered by the
relevant PRC governmental authorities to rectify such non-compliance and, if we fail to do so
within a given period of time, we may be subject to fines ranging from RMB1,000 and
RMB10,000 for each of our unregistered lease agreements. As such, we estimate that the
maximum penalty we might be subject to with respect to these unregistered leased properties
as of the Latest Practicable Date would be approximately RMB100,000, which we believe is
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immaterial. Our Directors are of the view that such failure to register will not have any material
adverse effect on our financial condition or results of operations. As of the Latest Practicable
Date, we were not aware of any notice or allegation of penalty from PRC government
authorities for each of our unregistered lease agreements. For details, see “Risk Factors – Risks
Relating to Regulatory Compliance – Our leased property interests may be defective and our
right to lease or use the properties may be challenged” in this prospectus.
A W ARDS AND RECOGNITIONS
During the Track Record Period and up to the Latest Practicable Date, we received
various awards, honors and recognitions that have demonstrated our advanced technological
and innovative capabilities, which primarily include:
Award, Honor or Recognition Y ear Awarding Entity
Shanghai “Specialized, Refined,
Characterized and Innovative”
Small and Medium-Sized
Enterprise ( ɪऎ̹“ਖ਼ၚतอ”ʕ
ʃΆุ)
2021-2022 Shanghai Municipal Commission
of Economy and Informatization
(ึ)
Selected in “Digital China, You
and Me” Information and
Communication Industry
Innovation and Entrepreneurship
Outstanding Entrant Project (“ ᅰ
οʕ਷ϞЫϞҢ”Бุ
ධͦ)
2021 China Association of
Communication Enterprises ( ʕ
Άุ՘ึ)
“Golden V oice” – China Best All
Media Intelligent Customer
Service Solution Award, 2021
(ᆤ – 2021 ʕ਷௰ԳΌద᜗
ᆤ)
2021 China Best Customer Contact
Center & Customer Experience
Selection Committee ( ʕ਷௰Գ
˒᜗᜕൙
፯ଡ଼։ึ), 51callcenter ( խ̣ʕ
ːၾBPOБุ༟ৃၣ), 4PS
Contact Center International
Standards Organization (4PS ᑌ
ഖʕː਷ყᅺ๟ଡ଼ᔌ), China
Contact Center & BPO
Association ( ʕ਷խ̣ʕːၾ
BPOପุᑌຑ), and China
Contact Center Industry Self-
Discipline and Supervision
Committee ( Ό਷խ̣ʕːБุ
ึ)
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Award, Honor or Recognition Y ear Awarding Entity
Second prize, ISCSLP 2022
Conversational Short-Phrase
Speaker Diarization Challenge
(ISCSLP2022Ⴍ༑ɛ
ࠏ)
2022 Institute of Acoustics, Chinese
Academy of Sciences (ኪ
הNorthwestern
Polytechnical University ( Г̏
ʈุɽኪ), Agency for Science,
Technology and Research ( อ̋
սA*STARה,)
Shanghai Jiao Tong University
(ɪऎʹஷɽኪ) and Magic Data
(ʮ̡)
“Golden V oice” – China Best
Customer Contact Center
Technology Solution of the Year
Awards, 2022 (ᆤ – 2022 ʕ
˒ᑌഖʕːҦஔ༆Ӕ˙
ᆤ)
2022 China Best Customer Contact
Center & Customer Experience
Selection Committee ( ʕ਷௰Գ
˒᜗᜕൙
፯ଡ଼։ึ), 51callcenter ( խ̣ʕ
ːၾBPOБุ༟ৃၣ), 4PS
Contact Center International
Standards Organization (4PS ᑌ
ഖʕː਷ყᅺ๟ଡ଼ᔌ), China
Contact Center & BPO
Association ( ʕ਷խ̣ʕːၾ
BPOପุᑌຑ), and China
Contact Center Industry Self-
Discipline and Supervision
Committee ( Ό਷խ̣ʕːБุ
ึ)
2021 Shanghai Computer Society
Science and Technology Award
– Technological Invention
Award (2021ၑዚ
ኪҦஔᆤ –ᆤ)
2022 Shanghai Computer Society ( ɪऎ
ၑዚኪึ)
Information System Construction
and Service Capability (CS2)
Grade Certificate (ண
ਕঐɢ(CS2)ࣣ)
2022 China Federation of Electronics
and Information Industry ( ʕ਷
БุᑌΥึ)
Shanghai Enterprise Technology
Center ( ɪऎ̹ΆุҦஔʕː)
2023 Shanghai Municipal Commission
of Economy and Informatization
(ึ)
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Award, Honor or Recognition Y ear Awarding Entity
Outstanding Innovation Award in
the First Science and
Technology Innovation
Conference of Shanghai
Xinzhuang Industry Park ( ɪऎ
Ҧ௴อɽึ
௫̈௴อᆤ)
2023 Shanghai Xinzhuang Industry Park
Management Committee ( ɪऎ̹
ึ)
During the Track Record Period and up to the Latest Practicable Date, awards, honors and
recognitions related to our commercialization achievements, sales and marketing capabilities,
as well as recognition from our business partners granted to us or our key personnel primarily
included:
Award, Honor or Recognition Y ear Awarding Entity
Contracts Observing and Promises
Keeping Enterprise – Class
AAA (2021-2024) (AAAΥ
؎2021-2024))
2021 China Business Credit Public
Service Platform (ڦ
ਕ̨̻) and Huaxia
Zhongcheng (Beijing)
International Credit Evaluation
Co., Ltd. (଺༐(̏ԯ)ڦ
ʮ̡)
The 19th China Information
Technology Service Intelligent
Customer Service Industry
Conference – 2020-2021 Best
Manager in China* (ʕ
˒ᑌഖʕːʿ௰Գ၍ଣ
ɛ൙ᄲ – 2020-2021ʕ਷௰
Գ၍ଣɛ)
2021 Customer Contact Center Standard
Committee (CCCS˒ᑌഖʕː
ึ)
Baidu AI Cloud – Favored Value-
Added Sales Partner (౽ঐ
ථ –ቖਯྫМ)
2021 Beijing Baidu Netcom Science and
Technology Co., Ltd. (ܓ
ʮ̡)
Guangzhou Unicom Outstanding
Partner in 2021 ( ᄿψᑌஷ2021
ᎴӸΥЪྫМ)
2022 China United Network
Communications Corporation
Limited Guangzhou Branch ( ʕ
ʮ̡ᄿψ̹
ʱʮ̡)
Hunan Unicom Outstanding
Partner in 2022 (ᑌஷ2022
ᎴӸΥЪྫМ)
2023 China United Network
Communications Corporation
Limited Hunan Branch ( ʕ਷ᑌ
̹ʱʮ
̡)
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Note:
* Granted to Mr. SUN.
In addition, we and our key personnel received a number of awards, honors and
recognitions on corporate governance and general operations during the Track Record Period
and up to the Latest Practicable Date, which primarily included:
Award, Honor or Recognition Y ear Awarding Entity
2020 (4th) Boao Enterprise Forum
– China (Industry) Leader
Enterprise (2020(֣)௹㏲Ά
ุሞእ – ʕ਷(Бุ)Άุ)
2021 China Business Herald ( ʕ਷ਠజ
ٟand CEN.CN ( ʕ਷Άุၣ)
2020 (4th) Boao Enterprise Forum
– China (Industry) Leader
Entrepreneur* (2020(֣)௹
㏲Άุሞእ – ʕ਷(Бุ)ɛ
ي)
2021 China Business Herald ( ʕ਷ਠజ
ٟand CEN.CN ( ʕ਷Άุၣ)
2021 Outstanding Enterprise
Award (2021ᎴӸΆุᆤ)
2022 Shanghai Xinzhuang Industry Park
Management Committee ( ɪऎ̹
ึ)
Top Companies to Watch for
Investors in 2022 (2022௰
Άุ)
2023 Shanghai Equity Exchange ( ɪऎ
ʕː)
Note:
* Granted to Mr. TANG.
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LICENSES AND PERMITS
As confirmed by our PRC Legal Adviser, as of the Latest Practicable Date, we had
obtained all material requisite licenses, permits and approvals from the relevant government
authorities for our operations in the PRC, and such licenses, permits and approvals remained
in full effect. The following table sets forth the details of the material licenses and permits
necessary for our operations held by us as of the Latest Practicable Date:
License/Permit
License/
Permit No.
License/
Permit Holder Grant Date Expiration Date
High and New Technology
Enterprise Certificate ( ৷อҦஔ
ࣣ)
GR202131004988 Company December 23,
2021
December 22,
2024
Quality Management System
Certificate ISO9001 ( ሯඎ၍ଣ᜗
ࣣISO9001)
00922Q10023R3M Company January 10,
2022
January 9, 2025
V AT License (ุਕ຾ᐄ஢
̙ᗇ), covering internet access
services business
B1-20235473 Sichuan
V oicecomm
Zhishi
November 14,
2023
November 14,
2028
Sichuan V oicecomm Zhishi will apply for a renewal of the existing V AT License with the
certificate number of “B1-20235473” after the Listing, and will continue to hold a V AT License
which includes ISP services (for internet users only), being a qualification required for our
business operations. We will conduct ISP services (for internet users only) through Sichuan
V oicecomm Zhishi. In accordance with current laws and regulations of the PRC, ISP services
do not fall within the types of value-added telecommunication services subject to restrictions
on foreign investment access in the PRC. Moreover, according to the Opinions on Further
Opening Up V alue-Added Telecommunication Services in the China (Shanghai) Pilot Free
Trade Zone (ʕ਷(ɪऎ)จԈ) issued
on January 6, 2014 and the Special Management Measures for Foreign Investment Access in
Free Trade Pilot Zones (negative list) (݄(૶
ఊ)) issued on December 27, 2021, the foreign shareholding ratio for ISP services (for
internet users only) in the China Pilot Free Trade Zone could exceed 50%. Considering that
Sichuan V oicecomm Zhishi is registered in the China (Sichuan) Pilot Free Trade Zone, as a
qualified company, and would hold a V AT License which includes ISP services (for internet
users only) after the Listing, the foreign shareholding ratio therefor may exceed 50%. In
addition, based on the consultation with relevant authority, our PRC Legal Adviser confirmed
that, after the Listing, Sichuan V oicecomm Zhishi holding a V AT License which includes ISP
services (for internet users only) will continue to comply with relevant foreign investment
access policies and regulations of the PRC with respect to ISP services.
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We intend to apply for renewal of our key licenses and permits, the procedures for which
is expected to be initiated timely prior to their respective expiration date. The successful
renewal of our existing licenses, permits and approvals will be subject to our fulfillment of
relevant requirements. As of the Latest Practicable Date, our Directors were not aware of any
reason that would cause or lead to the non-renewal of our existing licenses, permits and
approvals. Our PRC Legal Adviser confirmed that, as of the Latest Practicable Date, there was
no substantial legal impediment for us to renew our existing licenses, permits and certificates
as long as we would comply with the relevant legal requirements.
LEGAL PROCEEDINGS AND COMPLIANCE
During the Track Record Period and up to the Latest Practicable Date, we had not been
involved in any actual or pending legal, arbitration or administrative proceedings (including
any bankruptcy or receivership proceedings) that we believe would have a material adverse
effect on our business, financial condition, results of operations, reputation or compliance. Our
Directors confirmed that, during the Track Record Period and up to the Latest Practicable Date,
we were not involved in any non-compliance incidents which would, individually or in
aggregate, have a material adverse effect on our business as a whole. As confirmed by our PRC
Legal Adviser, our business operations had been carried out in compliance with applicable PRC
laws and regulations in all material respects during the Track Record Period and up to the
Latest Practicable Date.
From time to time, we may be involved in legal proceedings, investigations,
administrative penalties or other claims or disputes arising in the ordinary course of our
business. For risks and uncertainties relating thereto, see “Risk Factors – Risks Relating to Our
General Operations – We may be involved in legal proceedings and commercial disputes,
which could have a material adverse effect on our business, financial condition and results of
operations” in this prospectus.
RISK MANAGEMENT AND INTERNAL CONTROL
We are exposed to various risks for our operations so risk management is important for
our business. For details of the various operational risks we face, see “Risk Factors” in this
prospectus. In addition, we are also exposed to various financial risks, such as credit and
liquidity risks that arise in the normal course of our business. For details, see “Financial
Information – Risk Disclosures” in this prospectus. In order to identify, assess, and control the
risks that may cause impediments to our business, we have established and implemented
comprehensive risk management and internal control systems consisting of policies and
procedures that we consider appropriate for various aspects of our business operations, and are
dedicated to continuously improving these systems.
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Our Board of Directors is collectively responsible for the establishment and updating of
our risk management and internal control systems, while our management proactively monitors
the daily implementation of the internal control procedures and measures with respect to each
subsidiary and functional teams, and also conducts periodic review of the implementation
thereof, to ensure their effectiveness and sufficiency. Risks identified by our management will
be analyzed on the basis of likelihood and impact, and properly followed up, mitigated and
rectified, and reported to our Board of Directors. Specifically, we have adopted and
implemented the following risk management and internal control policies and protocols.
Operational Risk Management
We are faced with operational risks relating to our daily operations, which primarily arise
from inadequate or failed internal processes, human errors, IT system failures or external
events. We consider these operational risks to be the key risks in our business and believe that,
with adequate operational policies and procedures, these inherent risks can be controlled and
mitigated. We take a comprehensive approach with regard to operational risk management, and
implement mechanisms with detailed and decentralized responsibilities and clear rewards and
punishment systems. Different departments are collectively responsible for ensuring the
compliance of our daily operations with our internal procedures. We also reiterate the
importance of adherence to our operational protocols and procedures to our employees and, in
particular, new employees, to ensure effective implementation of our operational protocols and
procedures.
We also developed a robust risk management system monitoring and addressing risks in
our daily operations such as through the management of our internal financial records,
company chops, seals and signatures, key properties and business files. In the event of a major
adverse event, the matter will be escalated to our CEO and the Board of Directors to take
appropriate measures. Through effective operational risk management, we expect to control
operational risks within a reasonable range by identifying, measuring, monitoring and
containing the same to reduce potential losses. To ensure the continuity of our business, we
have also put in place contingency plans for detecting and responding to emergency incidents.
In the event of an emergency incident, our contingency plans set out prescribed response
protocols applicable to our various department. We continue to assess the effectiveness of our
contingency plans, and would perform reviews after each emergency incident to identify
potential areas for improvement. We also conduct regular emergency response drills to ensure
our employees are familiar with our response protocols.
Legal and Compliance Risk Management
Our business is subject to the regulation and supervision by national, provincial and local
government authorities with regard to our business operations, which may be subject to
changes. For further details on the applicable laws and regulations in relation to our business
operations, see “Regulatory Overview” in this prospectus. We have designed and adopted strict
internal procedures to achieve effective identification and management of compliance risk and
ensure that our operations are in compliance with applicable laws and regulations. We maintain
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internal procedures to ensure that we have obtained all material requisite licenses, permits and
approvals for our business operations, and conduct regular reviews to monitor the status and
effectiveness of such licenses, permits and approvals. We obtain requisite governmental
approvals or consents, including preparing and submitting all necessary documents for filing
with relevant government authorities, within the prescribed regulatory timelines. We have also
in place detailed internal procedures to ensure that our in-house legal personnel review our
solutions, including upgrades to existing solutions, for regulatory compliance before they are
made available to the general public. In addition, we strengthen our legal and compliance risk
management by monitoring legal updates, including updates on the interpretation of applicable
laws and regulations by relevant regulatory authorities, and accordingly updating our internal
protocols and procedures in a timely manner.
Financial Reporting Risk Management
We have adopted comprehensive accounting policies in connection with our financial
reporting risk management, such as financial reporting management policy, budget
management policy, treasury management policy, financial statements preparation policy, and
finance staff management policy. We have various procedures and IT systems in place to
implement our accounting policies, and our finance department reviews our management
accounts based on such procedures. In addition, we provide ongoing training to our finance
staff to ensure that these policies are well-observed and effectively implemented.
Intellectual Property Risk Management
We have implemented a set of comprehensive measures to protect our intellectual
property. For instance, our legal personnel will ensure that all necessary applications, renewals
or filings for trademark, copyright and patent registrations have been timely made to the
competent authorities. Moreover, we conduct uniform and centralized intellectual property
management, which requires that any application, implementation, authorization or transfer of
our intellectual property rights will need to be subject to the approval of our management. In
addition, any of our intellectual property rights, as long as it is owned by one of our
subsidiaries, can be shared among our Group members for usage, sales or promise to sell
relevant solutions.
Anti-Bribery and Anti-Corruption Risk Management
We have in place anti-bribery and anti-corruption policies to safeguard against any
bribery, corruption and fraud in violation of applicable anti-corruption and anti-bribery laws
and regulations within our Group, which prohibits any bribery or corruption activities by the
employees, either for the pursuit of improper personal benefits or improper interests of our
Group. The policies provide guidance on anti-corruption and anti-bribery practices, and
explain potential bribery and corruption conduct and our anti-bribery and corruption measures.
We keep accurate books and records that reflect the substance of transactions and asset
dispositions in reasonable details, and will not approve a transaction or payment if the books
and records do not reflect the substance thereof. We conduct routine trainings for our
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employees regarding our anti-bribery and anti-corruption policies to facilitate better
implementation. We make our internal reporting channel open and available for our staff to
report any suspicious bribery and corruption acts, which may be anonymous. Any reported
incidents and personnel will be investigated and handled in a prompt, independent and fair
manner, and appropriate measures will be taken.
Information System and Data Security Risk Management
We have established an information system and data security risk management
framework, including relevant internal control policies and risk management mechanisms to
ensure information and data security, which primarily consists of:
 internal authentication and authorization systems that set forth confidentiality
categorization and control access to data, so that confidential and data with
importance can only be accessed for authorized use and limited purposes, and by
authorized personnel;
 procedures for regular data backup, encryption and desensitization to prevent
unauthorized access, leakage, improper use or modification of, damage to or loss of
data;
 adoption of multiple layers of safeguards, including both internal and external
firewalls and anti-virus software, to identity and protect us against security attacks;
 procedures for regular system check, password policy and data recovery test to
safeguard our information assets and ensure the proper data management;
 information security incident management policies that evaluate critical risks and
set forth emergency plans for data security incidents;
 provision of information security training to our employees from time to time;
 security audits to be performed periodically and on an as-needed basis so as to
strengthen our security measures based on results thereof, which may include
vulnerability scanning and intrusion detection, data inspection and risk
identification, and security evaluation of idle equipment, etc.; and
 engagement of if necessary external legal counsel to review and update our internal
policies and ensure continuous compliance with all applicable laws and regulations;
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Human Resources Risk Management
We have established risk management and internal control policies covering various
aspects of human resource management such as recruitment, training, work ethics and legal
compliance. We maintain high standards in recruitment with strict procedures to ensure the
quality of new hires and provide specialized training sessions 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, enabling them to better meet customers’ needs. We also conduct
periodic performance reviews for our employees, and their remuneration is performance-based.
We have in place an employee handbook and a code of conduct approved by our management
and have distributed the same to all our employees. The handbook contains internal rules and
guidelines regarding work ethics, and fraud, negligence and corruption prevention
mechanisms. We monitor the implementation of internal risk management and internal control
policies on a regular basis to identify, manage and mitigate internal risks in relation to potential
incompliance with our code of conduct and violations of our internal policies or illegal acts at
all levels of our Group.
Investment Risk Management
As we may invest in or acquire businesses that are complementary to ours and aligned
with our overall growth strategies, such as businesses that can expand our solution offerings
and strengthen our technological capabilities, we have established investment project
evaluation and approval processes. Our management will review and determine all new
investments and major disposals. Specifically, it will be responsible for our investment project
sourcing, screening, due diligence, risk assessment, valuation, execution and post-investment
monitoring in accordance with our investment strategies. Each investment is assessed with
consideration of strategic values, risks, business synergies and potential return of the project
to be invested.
To monitor the ongoing implementation of our risk management policies and corporate
governance measures after the Global Offering, we have also adopted or will adopt, among
other things, the following risk management and internal control measures:
 the establishment of an audit committee responsible for overseeing our financial
records, internal control procedures and risk management systems. For details of the
qualifications and experiences of these committee members as well as a detailed
description of the responsibility of our audit committee, see “Directors, Supervisors
and Senior Management – Board Committees – Audit Committee” in this
prospectus;
 the appointment of Mr. Wenzhao ZHANG as our chief financial officer and Ms.
Yihan LIU and Mr. Willie Kai Cheong CHEUNG as our joint company secretaries
to ensure the compliance of our operations with relevant laws and regulations. For
details of their biographies, see “Directors, Supervisors and Senior Management” in
this prospectus;
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 the appointment of Maxa Capital Limited as our compliance advisor upon the
Listing to advise us on compliance with the Listing Rules; and
 the engagement of external legal advisers to advise us on compliance with the
Listing Rules and to ensure our compliance with the relevant regulatory
requirements and applicable laws, where necessary.
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OUR CONTROLLING SHAREHOLDERS
Pursuant to the Concert Party Agreement dated March 20, 2021, Mr. Tang, Mr. Sun and
Jiangfan Technology agreed that they shall act in concert with respect to, inter alia, the right
to convene board meetings and general meetings, right to propose resolutions, nomination
right, voting rights, nomination of senior management, and other matters which are subject to
approval in general meetings or board meetings of the Company, for the period since the date
of the Concert Party Agreement and up until they cease to hold any shares of our Company or
upon the termination of the Concert Party Agreement. For details, see “History, Development
and Corporate Structure – Concert Party Arrangement” in this prospectus.
As of the Latest Practicable Date, by virtue of the Concert Party Agreement, Mr. Tang,
Mr. Sun and Jiangfan Technology were collectively entitled to exercise voting rights of
approximately 35.97% of the voting rights in our Company, among which:
(i) Mr. Tang was able to exercise approximately 27.66% of the voting rights in our
Company through (a) his personal capacity as to approximately 11.26%; and (b)
V oicecomm Rongzhi as to approximately 16.40%. V oicecomm Rongzhi is a
company established in the PRC which is owned as to 99.00% by Mr. Tang and
1.00% by Ms. Xu (the spouse of Mr. Tang);
(ii) Mr. Sun was able to exercise approximately 7.54% of the voting rights in our
Company through (a) his personal capacity as to approximately 5.80%; and (b)
Jiageng Culture as to approximately 1.74%. Jiageng Culture is a company
established in the PRC which is wholly-owned by Mr. Sun; and
(iii) Jiangfan Technology was able to exercise approximately 0.77% of the voting rights
in our Company. Jiangfan Technology is wholly owned by Jiangcheng Asset
Management, which is in turn owned as to 60.0% by Mr. Yang, our non-executive
Director, and 40.0% by Mr. Jiang Haisheng (ऎ͛) (For background of Mr. Jiang
Haisheng (ऎ͛), see “History, Development and Corporate Structure – Series B
Financing” in this prospectus). Notwithstanding Mr. Jiang Haisheng (ऎ͛) only
holds 40% of equity interests in Jiangcheng Asset Management, Mr. Yang and Mr.
Jiang Haisheng (ऎ͛) confirmed that they are parties acting in concert with
respect to Jiangcheng Asset Management, and hence they jointly control Jiangfan
Technology and Jiangcheng Asset Management.
As such, Mr. Tang, Ms. Xu (the spouse of Mr. Tang and holding 1% of the equity interests
in V oicecomm Rongzhi), V oicecomm Rongzhi, Mr. Sun, Jiageng Culture, Mr. Yang, Mr. Jiang
Haisheng (ऎ͛) (holding indirectly 40% of the equity interests in Jiangfan Technology),
Jiangcheng Asset Management (the holding company of Jiangfan Technology) and Jiangfan
Technology were collectively entitled to exercise voting rights of approximately 35.97% of the
total issued shares of our Company as at the Latest Practicable Date, and are considered as a
group of controlling shareholders of our Company before the Listing. Immediately following
the completion of the Global Offering (assuming the Over-allotment Option is not exercised),
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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Mr. Tang, Ms. Xu, V oicecomm Rongzhi, Mr. Sun, Jiageng Culture, Mr. Yang, Mr. Jiang
Haisheng (ऎ͛), Jiangcheng Asset Management and Jiangfan Technology will be
collectively entitled to exercise voting rights of approximately 31.54% of the total issued
shares of our Company, and hence they will be a group of controlling shareholders of our
Company.
INDEPENDENCE FROM OUR CONTROLLING SHAREHOLDERS
As of the Latest Practicable Date, our Controlling Shareholders confirmed that 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. 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 respective close associates after the Listing.
Management Independence
Our Board comprises two executive Directors, four non-executive Directors and four
independent non-executive Directors. Although Mr. Tang, Mr. Sun and Mr. Yang being
members of our Controlling Shareholders, also serves as our executive Directors or
non-executive Director, our Directors believe that our Board and senior management will
function independently from our Controlling Shareholders for the following reasons:
1. each Director is aware of his/her fiduciary duties as a Director of our Company
which requires, among other things, that he/she acts for the benefit and in the best
interests of our Company and does not allow any conflict between his/her duties as
a Director and his/her personal interest;
2. in the event that there is a potential conflict of interest arising out of any transaction
to be entered into between our Company and our Directors or their respective
associates, the interested Director(s) shall abstain from voting at the relevant board
meetings of our Company in respect of such transactions, and shall not be counted
in the quorum;
3. our Board comprises ten Directors, and four of them are independent non-executive
Directors, which represents more than one-third of the members of our Board. Our
independent non-executive Directors have extensive experience in different areas
and have been appointed in accordance with the requirements of the Listing Rules
to ensure that the decisions of our Board are made after due consideration of
independent and impartial opinions; and
4. our senior management members are independent from our Controlling
Shareholders. They are experienced in the industry which we are engaged in.
Accordingly, they are able to discharge their duties independently from our
Controlling Shareholders.
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Having considered the above factors, our Directors are satisfied that they are able to
perform their roles in our Company independently, and our Director are of the view that we are
capable of managing our business independently from our Controlling Shareholders following
the completion of the Global Offering.
Operational Independence
We have full rights to make all decisions on, and to carry out, our own business operations
independently. Our Company, through our subsidiaries, holds the licenses and qualifications
necessary to carry on our current business, and has sufficient capital, facilities, technology and
employees to operate the business independently from our Controlling Shareholders. We have
access to third parties independently from and not connected to our Controlling Shareholders
for sources of suppliers and customers.
Based on the above, our Directors are satisfied that we will be able to function and
operate independently from our Controlling Shareholders and their respective close associates.
Financial Independence
During the Track Record Period and up to the Latest Practicable Date, we have
established our own finance department with a team of financial staff, who are responsible for
financial control, accounting, reporting, group credit and internal control functions of our
Company, independent from our Controlling Shareholders. We can make financial decisions
independently and our Controlling Shareholders do not intervene with our use of funds. We
have also established an independent audit system, a standardized financial and accounting
system and a complete financial management system.
During the Track Record Period and up to the Latest Practicable Date, we entered into
various facility agreements and loan agreements with certain banks (“ Lending Banks ”),
pursuant to which we obtained loans from the Lending Banks which were secured by personal
guarantees provided by some of our Controlling Shareholders and/or their spouses, namely Mr.
Tang, Ms. Xu (the spouse of Mr. Tang), Mr. Sun and his spouse. These loans were generally
used for supplementing the working capital of the Group, payment of procurement costs and/or
other financial needs in the ordinary and usual course of our business operation. As of the
Latest Practicable Date, (i) the guarantees provided by some of our Controlling Shareholders
and/or their spouses with respect to credit facilities in the aggregate amount of approximately
RMB300.0 million granted by the relevant Lending Banks will be released prior to the Listing
as agreed by the relevant banks; and (ii) the remaining loans in the aggregate amount of
approximately RMB38.0 million secured by the guarantees provided by our Controlling
Shareholders and/or their spouses have been fully repaid.
In addition, we had been capable of obtaining financing from third parties without relying
on any guarantee or security provided by the members of our Controlling Shareholders or their
respective associates.
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Based on the above, our Directors are of the view that we will be able to maintain
financial independence from our Controlling Shareholders and their respective close associates
after the Listing.
CORPORATE GOVERNANCE MEASURES
Our Directors recognize the importance of good corporate governance in protecting our
Shareholders’ interests. We have adopted the following measures to safeguard good corporate
governance standards and to avoid potential conflict of interests between our Group and our
Controlling Shareholders:
(a) our Articles provide that, unless otherwise provided, a Director shall not vote on any
resolution approving any contract or arrangement or any other proposal in which
such Director or any of his or her associates have a material interest nor shall such
Director be counted in the quorum present at the meeting;
(b) a Director with material interests shall make full disclosure in respect of matters that
may have conflict or potentially conflict with any of our interest and abstain from
the board meetings on matters in which such Director or his or her associates have
a material interest, unless attendance or participation of such Director at such
meeting of our Board is specifically requested by a majority of our independent
non-executive Directors;
(c) we are committed that our Board should include a balanced composition of
executive Directors and independent non-executive Directors. We have appointed
independent non-executive Directors and we believe our independent non-executive
Directors possess sufficient experience and they are free of any business or other
relationship which could interfere in any material manner with the exercise of their
independent judgement and will be able to provide an impartial, external opinion to
protect the interests of our public Shareholders. Details of our independent
non-executive Directors are set out in the section headed “Directors, Supervisors
and Senior Management” in this prospectus;
(d) as required by the Listing Rules, our independent non-executive Directors shall
review all connected transactions annually and confirm in our annual report that
such transactions have been entered into in our ordinary and usual course of
business, are either on normal commercial terms or on terms no less favorable to us
than those available to or from independent third parties and on terms that are fair
and reasonable and in the interest of our Shareholders as a whole;
(e) our Company will disclose decisions on matters reviewed by the independent
non-executive Directors either in its annual reports or by way of announcements as
required by the Listing Rules;
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(f) 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
(g) we have appointed Maxa Capital Limited as our compliance advisor to provide
advice and guidance to us in respect of compliance with the applicable laws and
regulations in Hong Kong, as well as 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 that may arise between our
Group and our Controlling Shareholders, and to protect our minority Shareholders’ interests
after the Listing.
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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 RMB31,059,230
comprising 31,059,230 Unlisted Shares with a nominal value of RMB1.00 each.
UPON COMPLETION OF THE GLOBAL OFFERING
Assuming the Over-allotment Option is not exercised, the share capital of our Company
immediately after the Global Offering and the Conversion of Unlisted Shares into H Shares will
be as follows:
Description of Shares (2) Number of Shares
Approximate
percentage of the
enlarged issued
share capital after
the Global Offering
Unlisted Shares 22,433,317 63.33%
H Shares converted from Unlisted
Shares (1) 8,625,913 24.35%
H Shares to be issued pursuant
to the Global Offering 4,365,660 12.32%
Total 35,424,890 100.00%
Notes:
(1) Please refer to the section headed “History, Development and Corporate Structure – Shareholding
structure of our Company” in this prospectus for details of the identities of the Shareholders whose
Shares will be converted into H Shares upon Listing.
(2) For the avoidance of doubt, both Unlisted Shares and H Shares are ordinary shares in the share capital
of our Company and are regarded as one class of Shares.
SHARE CAPITAL
– 362 –


--- page 372 ---
Assuming the Over-allotment Option is exercised in full, the share capital of our
Company immediately after the Global Offering and the Conversion of Unlisted Shares into H
Shares will be as follows:
Description of Shares (2) Number of Shares
Approximate
percentage of the
enlarged issued
share capital after
the Global
Offering (3)
Unlisted Shares 22,433,317 62.18%
H Shares converted from Unlisted
Shares (1) 8,625,913 23.91%
H Shares to be issued pursuant
to the Global Offering 5,020,500 13.92%
Total 36,079,730 100.00%
Notes:
(1) Please refer to the section headed “History, Development and Corporate Structure – Shareholding
structure of our Company” in this prospectus for details of the identities of the Shareholders whose
Shares will be converted into H Shares upon Listing.
(2) For the avoidance of doubt, both Unlisted Shares and H Shares are ordinary shares in the share capital
of our Company and are regarded as one class of Shares.
(3) The aggregate of the percentage figures in the above table may not add up to 100% due to rounding of
the percentage figures to two decimal places.
PUBLIC FLOAT REQUIREMENTS
Rules 8.08(1)(a) and (b) of the Listing Rules require there to be an open market in the
securities for which listing is sought and for a sufficient public float of an issuer’s listed
securities to be maintained. This normally means that (i) at least 25% of the issuer’s total
issued share capital must at all times be held by the public; and (ii) where an issuer has one
class of securities or more apart from the class of securities for which listing is sought, the total
securities of the issuer held by the public (on all regulated market(s) including the Stock
Exchange) at the time of listing must be at least 25% of the issuer’s total issued share capital.
In light of the above, at the time of the Listing, at least 25.0% of the total issued share
capital of our Company shall be held by the public (as defined in the Listing Rules).
SHARE CAPITAL
– 363 –


--- page 373 ---
OUR SHARES
Upon completion of the Global Offering and the Conversion of Unlisted Shares into H
Shares, our Company would have Unlisted Shares and H Shares. Both Unlisted Shares and H
Shares are ordinary shares in the share capital of our Company and are regarded as one class
of Shares. Apart from certain qualified domestic institutional investors in the PRC, certain PRC
qualified investors under the Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong
Kong Stock Connect, and other persons who are entitled to hold our H Shares pursuant to
relevant PRC laws and regulations or upon approvals of any competent authorities, H Shares
generally cannot be subscribed by or traded among legal and natural persons of the PRC.
The 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 for H Shares will be denominated and declared in Renminbi, and paid in
Hong Kong dollars or Renminbi, whereas all dividends for Unlisted Shares will be paid in
Renminbi. Other than cash, dividends could also be paid in the form of shares.
CONVERSION OF OUR UNLISTED SHARES INTO H SHARES
Our Unlisted Shares are unlisted Shares which are currently not listed or traded on any
stock exchange.
According to stipulations by the State Council securities regulatory authority and the
Articles of Association, the Unlisted Shares may be converted into H Shares. Such converted
Shares may be listed or traded on an overseas stock exchange provided that the conversion and
trading of such converted Shares shall only be effected after all requisite internal approval
process have been duly completed and the approval from the relevant PRC regulatory
authorities (including the CSRC) and the relevant overseas stock exchange have been obtained.
In addition, such conversion and trading shall in all respects comply with the regulations
prescribed by the State Council securities regulatory authority and the regulations,
requirements and procedures prescribed by the relevant overseas stock exchange.
If any of the Unlisted Shares are to be converted to H Shares and to be traded on the Stock
Exchange, such conversion requires the approval of the relevant PRC regulatory authorities,
including the CSRC. Approval of the Stock Exchange is required for the listing of such
converted Shares on the Stock Exchange. Subject to fulfilling the procedures below, our
Company may apply for the listing of all or any portion of the Unlisted Shares on the Stock
Exchange as H Shares before any proposed conversion so that the conversion process can be
completed promptly upon notice to the Stock Exchange and delivery of shares for entry on the
H Share register. As any listing of additional Shares after our Company’s initial listing on the
Stock Exchange is ordinarily considered by the Stock Exchange to be a purely administrative
matter, it does not require prior application for listing as at the time of our Company’s initial
SHARE CAPITAL
– 364 –


--- page 374 ---
listing in Hong Kong. A vote by our Shareholders in general meeting is not required for the
listing and trading of the converted Shares on an overseas stock exchange. Any listing of the
converted Shares on the Stock Exchange after the initial listing is subject to prior notification
by way of announcement to inform Shareholders and the public of any proposed conversion.
After all the requisite approvals have been obtained, the relevant Unlisted Shares will be
withdrawn from the Unlisted Share register, and our Company will re-register such Shares on
the H Share register maintained in Hong Kong and instruct the H Share Registrar to issue H
Share certificates. Registration on the H Share register of our Company will be on the
conditions that (i) the H Share Registrar lodges with the Stock Exchange a letter confirming
the entry of the relevant H Shares on the H Share register and the due dispatch of H Share
certificates; and (ii) the admission of the H Shares to be traded on the Stock Exchange complies
with the Listing Rules and the General Rules of HKSCC and the HKSCC Operational
Procedures in force from time to time. Until the converted Shares are re-registered on the H
Share register of our Company, such Shares would not be listed as H Shares.
The Company has applied for the Conversion of Unlisted Shares into H Shares, which
involves 8,625,913 Shares held by 30 Shareholders. For details, see “History, Development and
Corporate Structure – Shareholding structure of our Company” in this prospectus for further
details.
RESTRICTIONS OF SHARE TRANSFER
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
Shares issued by our Company prior to the issue of H Shares 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 of our Company shall
declare their shareholdings in our Company and any changes in their shareholdings. Shares
transferred by our Directors, Supervisors and 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 shares are listed and traded, nor within
half a year after they leave their positions in our Company. The Articles of Association may
contain other restrictions on the transfer of the Shares held by our Directors, Supervisors and
members of senior management of our Company.
For details of the lock-up undertaking given by our Controlling Shareholders pursuant to
Rule 10.07 of the Listing Rules, see “Underwriting – Undertakings pursuant to the Listing
Rules and the Hong Kong Underwriting Agreement – Undertakings by the Controlling
Shareholders” in this prospectus.
SHARE CAPITAL
– 365 –


--- page 375 ---
SHAREHOLDERS’ GENERAL MEETINGS
For details of circumstances under which Shareholders’ general meeting are required, see
“Appendix V – Summary of Articles of Association” to this prospectus.
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, our Company is required to
register its shares that are not listed on any overseas stock exchange with China Securities
Depository and Clearing Corporation Limited within 15 Business Days upon the Listing and
provide a written report to the CSRC regarding the centralized registration and deposit of our
Shares that are not listed on the overseas stock exchange as well as the offering and listing of
our H Shares.
SHARE CAPITAL
– 366 –


--- page 376 ---
So far as our Directors are aware, immediately following the completion of the Global
Offering and the Conversion of Unlisted Shares into H Shares and without taking into account
any H Shares which may be issued pursuant to the exercise of the Over-allotment Option, the
following persons will have an interest and/or short position in the Shares or the underlying
Shares which would fall to be disclosed to us and the Stock Exchange under the provisions of
Divisions 2 and 3 of Part XV of the SFO, or, who are, directly or indirectly interested in 10%
or more of the nominal value of any class of our share capital carrying rights to vote in all
circumstances at general meetings of our Company:
LONG POSITIONS IN THE SHARES OF OUR COMPANY
Name of Shareholder
Capacity/ nature
of interest
Description
of Shares
upon
completion
of the Global
Offering
and the
Conversion
of Unlisted
Shares into
H Shares
(12)
Number
of Shares
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company as
of the Latest
Practicable
Date (1)
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company
upon
completion of
the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Approximate
percentage of
shareholding in
our Unlisted
Shares/H Shares
(as appropriate)
upon completion
of the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Mr. Tang (3) & (4) Beneficial owner;
interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
V oicecomm
Rongzhi
(3) & (4)
Interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
Ms. Xu
(3) & (4) Spousal interest Unlisted Shares 11,099,558 35.74% 31.82% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
SUBSTANTIAL SHAREHOLDERS
– 367 –


--- page 377 ---
Name of Shareholder
Capacity/ nature
of interest
Description
of Shares
upon
completion
of the Global
Offering
and the
Conversion
of Unlisted
Shares into
H Shares
(12)
Number
of Shares
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company as
of the Latest
Practicable
Date (1)
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company
upon
completion of
the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Approximate
percentage of
shareholding in
our Unlisted
Shares/H Shares
(as appropriate)
upon completion
of the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Mr. Sun (3) & (5) Beneficial owner;
interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
Jiageng Culture
(3) & (5) Interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
Mr. Yang
(3), (6) & (7) Interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
Mr. Jiang Haisheng
(ऎ͛)
(3), (6) & (7)
Interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
SUBSTANTIAL SHAREHOLDERS
– 368 –


--- page 378 ---
Name of Shareholder
Capacity/ nature
of interest
Description
of Shares
upon
completion
of the Global
Offering
and the
Conversion
of Unlisted
Shares into
H Shares
(12)
Number
of Shares
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company as
of the Latest
Practicable
Date (1)
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company
upon
completion of
the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Approximate
percentage of
shareholding in
our Unlisted
Shares/H Shares
(as appropriate)
upon completion
of the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Jiangcheng Asset
Management (3), (6) & (7)
Interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
Jiangfan
Technology
(3), (6) & (7)
Beneficial owner;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
Zibo Yingke Jiyun
Venture Capital
Partnership (Limited
Partnership) (߅ޮ
Λ༶௴ุҳ༟ΥྫΆุ
(Υྫ)) (“ Yingke
Jiyun ”)
(8) & (13)
Beneficial owner Unlisted Shares 1,200,000 3.86% 3.39% 5.35%
H Shares 1,200,000 3.86% 3.39% 9.24%
Zibo Caijin Holding
Group Co., Ltd. ( ଍௹
ʮ
̡)( “ Zibo Caijin ”)
(8)
Interest in
controlled
corporation
Unlisted Shares 1,200,000 3.86% 3.39% 5.35%
H Shares 1,200,000 3.86% 3.39% 9.24%
Yingke Innovation Asset
Management Co., Ltd.
(௴อ༟ପ၍ଣϞ
ʮ̡)( “ Yingke
Innovation ”)
(8)
Interest in
controlled
corporation
Unlisted Shares 1,825,000 5.88% 5.15% 8.14%
H Shares 1,825,000 5.88% 5.15% 14.05%
Mr. Qian Mingfei (׼
࠭“() Mr. Qian ”)
(8)
Interest in
controlled
corporation
Unlisted Shares 1,825,000 5.88% 5.15% 8.14%
H Shares 1,825,000 5.88% 5.15% 14.05%
SUBSTANTIAL SHAREHOLDERS
– 369 –


--- page 379 ---
Name of Shareholder
Capacity/ nature
of interest
Description
of Shares
upon
completion
of the Global
Offering
and the
Conversion
of Unlisted
Shares into
H Shares
(12)
Number
of Shares
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company as
of the Latest
Practicable
Date (1)
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company
upon
completion of
the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Approximate
percentage of
shareholding in
our Unlisted
Shares/H Shares
(as appropriate)
upon completion
of the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Shanghai Chenqi
Information
Consultation Co., Ltd.
(ፔ༔Ϟ
ʮ̡)( “ Chenqi
Information ”)
(9)
Beneficial owner Unlisted Shares 827,000 2.66% 2.33% 3.69%
H Shares 1,500,000 4.83% 4.23% 11.55%
Mr. Shi Yerong ( ุͩᏌ)
(“Mr. Shi ”)(9)
Interest in
controlled
corporation
Unlisted Shares 827,000 2.66% 2.33% 3.69%
H Shares 1,500,000 4.83% 4.23% 11.55%
Jiaxing Shangyu
Investment Partnership
(Limited Partnership)
(༃ҳ༟ΥྫΆ
ุ(Υྫ))
(“Jiaxing
Shangyu ”)
(10)
Beneficial owner Unlisted Shares 500,000 1.61% 1.41% 2.23%
H Shares 1,300,000 4.19% 3.67% 10.01%
Ms. Gu Luying
(ߵ10)
Interest in
controlled
corporation
Unlisted Shares 500,000 1.61% 1.41% 2.23%
H Shares 1,300,000 4.19% 3.67% 10.01%
Shanghai Qifeng
Investment
Management Co., Ltd.
(ɪऎ઼ჾҳ༟၍ଣϞ
ʮ̡)( “ Qifeng
Investment ”)
(10)
Interest in
controlled
corporation
Unlisted Shares 500,000 1.61% 1.41% 2.23%
H Shares 1,800,000 5.80% 5.08% 13.86%
Mr. Zhao Qi ( Ⴛೡ)
(10) Interest in
controlled
corporation
Unlisted Shares 500,000 1.61% 1.41% 2.23%
H Shares 1,800,000 5.80% 5.08% 13.86%
SUBSTANTIAL SHAREHOLDERS
– 370 –


--- page 380 ---
Name of Shareholder
Capacity/ nature
of interest
Description
of Shares
upon
completion
of the Global
Offering
and the
Conversion
of Unlisted
Shares into
H Shares
(12)
Number
of Shares
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company as
of the Latest
Practicable
Date (1)
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company
upon
completion of
the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Approximate
percentage of
shareholding in
our Unlisted
Shares/H Shares
(as appropriate)
upon completion
of the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Mr. Zhao Fenggao
(Ⴛჾ৷)(10)
Interest in
controlled
corporation
Unlisted Shares 500,000 1.61% 1.41% 2.23%
H Shares 1,800,000 5.80% 5.08% 13.86%
Jiaxing Chengshun Phase
II Equity Investment
Partnership (Limited
Partnership) ྗጳ༐න
ᛆҳ༟ΥྫΆุ
(Υྫ)
(“Jiaxing Chengshun
Phase II ”)
(11) & (14)
Beneficial owner Unlisted Shares 1,538,462 4.95% 4.34% 6.86%
Chengmeng (Shanghai)
Equity Investment
Fund Management
Co., Ltd. ( ༐ຑ(ɪऎ)
ࠢ
ʮ̡)( “ Chengmeng
(Shanghai) ”)
(11)
Interest in
controlled
corporation
Unlisted Shares 1,538,462 4.95% 4.34% 6.86%
Mr. Fan Jue ( ᅾ䊌)
(11) Interest in
controlled
corporation
Unlisted Shares 1,538,462 4.95% 4.34% 6.86%
Mianyang Xintou
Dinghua Equity
Investment Partnership
(Limited Partnership)
(ᛆҳ
༟ΥྫΆุ(Υྫ))
(“Mianyang Xintou
Dinghua ”)
(11)
Interest in
controlled
corporation
Unlisted Shares 1,538,462 4.95% 4.34% 6.86%
SUBSTANTIAL SHAREHOLDERS
– 371 –


--- page 381 ---
Name of Shareholder
Capacity/ nature
of interest
Description
of Shares
upon
completion
of the Global
Offering
and the
Conversion
of Unlisted
Shares into
H Shares
(12)
Number
of Shares
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company as
of the Latest
Practicable
Date (1)
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company
upon
completion of
the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Approximate
percentage of
shareholding in
our Unlisted
Shares/H Shares
(as appropriate)
upon completion
of the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Mianyang Sci-Tech City
New Area Investment
Holding (Group) Co.,
Ltd. (อਜ
ٰ(ණྠ)ʮ
̡)( “ Mianyang Sci-
Tech City New Area
Investment ”)
(11)
Interest in
controlled
corporation
Unlisted Shares 1,538,462 4.95% 4.34% 6.86%
Zibo Bokai Venture
Capital Co., Ltd.
(଍௹௹ක௴ุҳ༟Ϟ
ʮ̡)
(13)
Beneficial owner Unlisted Shares 500,000 1.61% 1.41% 2.23%
Qingdao Yingke Value
Venture Capital
Partnership (L.P.)
(࠽
௴ุҳ༟ΥྫΆุ
(Υྫ))
(13)
Beneficial owner Unlisted Shares 625,000 2.01% 1.76% 2.79%
Beneficial owner H Shares 625,000 2.01% 1.76% 4.81%
Qingdao Huazi
Shengtong Equity
Investment Fund
Partnership (Limited
Partnership) (ശ༟
Υྫ
Άุ(Υྫ))
(13)
Beneficial owner H Shares 500,000 1.61% 1.41% 3.85%
SUBSTANTIAL SHAREHOLDERS
– 372 –


--- page 382 ---
Name of Shareholder
Capacity/ nature
of interest
Description
of Shares
upon
completion
of the Global
Offering
and the
Conversion
of Unlisted
Shares into
H Shares
(12)
Number
of Shares
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company as
of the Latest
Practicable
Date (1)
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company
upon
completion of
the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Approximate
percentage of
shareholding in
our Unlisted
Shares/H Shares
(as appropriate)
upon completion
of the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Gongqingcheng
Huanping Equity
Investment Partnership
(Limited Partnership)
(ᛆ
ҳ༟ΥྫΆุ
(Υྫ))
(14)
Beneficial owner Unlisted Shares 745,000 2.40% 2.10% 3.32%
Chengdu Technology
Innovation Investment
Group Co., Ltd.
(Ҧ௴อҳ༟ණ
ʮ̡)
(14)
Beneficial owner Unlisted Shares 603,000 1.94% 1.70% 2.69%
Neijiang High-tech
Investment Service
Co., Ltd. ( ʫϪ৷อ
ப΂
ʮ̡)
(14)
Beneficial owner Unlisted Shares 461,538 1.49% 1.30% 2.06%
Suzhou Bodao Dinghua
Equity Investment
Partnership (Limited
Partnership) ( ᘽψ☞༸
ᛆҳ༟ΥྫΆุ
(Υྫ))
(14)
Beneficial owner Unlisted Shares 500,000 1.61% 1.41% 2.23%
H Shares 250,000 0.80% 0.71% 1.92%
Notes:
(1) The calculation is based on the total number of 31,059,230 Shares in issue as at the Latest Practicable Date,
including 22,433,317 Unlisted Shares and 8,625,913 Unlisted Shares which will be converted into H Shares
upon completion of the Global Offering.
SUBSTANTIAL SHAREHOLDERS
– 373 –


--- page 383 ---
(2) The calculation is based on the total number of 22,433,317 Unlisted Shares and 12,991,573 H Shares in issue
upon Listing (comprising (i) an aggregate of 8,625,913 Shares to be converted from Unlisted Shares; and (ii)
4,365,660 Shares to be issued pursuant to the Global Offering, without taking into account the H Shares which
may be issued upon the exercise of Over-allotment Option).
(3) Pursuant to the Concert Party Agreement dated March 20, 2021, Mr. Tang, Mr. Sun and Jiangfan Technology
agreed that they shall act in concert with respect to, inter alia, the right to convene board meetings and general
meetings, right to propose resolutions, nomination right, voting rights, nomination of senior management, and
other matters which are subject to approval in general meetings or board meetings of the Company, for the
period since the date of the Concert Party Agreement and up until they cease to hold any shares of the Company
or upon the termination of the Concert Party Agreement. For details, see “History, Development and Corporate
Structure – Concert Party Arrangement” in this prospectus. As such, each of the Concert Parties are deemed
to be interested in the Shares each other is interested in.
(4) As at the Latest Practicable Date, Shares in which Mr. Tang is interested consist of (i) 3,498,000 Unlisted
Shares held by him in his own personal capacity; (ii) 5,093,558 Unlisted Shares held by V oicecomm Rongzhi,
a company held as to 99% by Mr. Tang and 1% by his spouse, in which Mr. Tang is deemed to be interested
under the SFO; and (iii) 2,580,000 Unlisted Shares (among which 72,000 Unlisted Shares will be converted
to H Shares upon Listing) in which Mr. Tang is deemed to be interested as a result of being a party
acting-in-concert with Mr. Sun, and Jiangfan Technology.
(5) As at the Latest Practicable Date, Shares in which Mr. Sun is interested consist of (i) 1,800,000 Unlisted Shares
held by him in his own personal capacity; (ii) 540,000 Unlisted Shares held by Jiageng Culture, a company
is wholly-owned by Mr. Sun, in which Mr. Sun is deemed to be interested under the SFO; and (iii) 8,831,558
Unlisted Shares (among which 72,000 Unlisted Shares will be converted to H Shares upon Listing) in which
Mr. Sun is deemed to be interested as a result of being a party acting-in-concert with Mr. Tang and Jiangfan
Technology.
(6) Jiangfan Technology is wholly-owned by Jiangcheng Asset Management, which is in turn held as to 60.0% by
Mr. Yang and 40.0% by Mr. Jiang Haisheng (ऎ͛). By virtue of the SFO, each of Mr. Yang and Mr. Jiang
Haisheng (ऎ͛) is deemed to be interested in the Shares that Jiangfan Technology is interested in.
(7) As at the Latest Practicable Date, Shares in which Jiangfan Technology is interested consist of (i) 240,000
Unlisted Shares (among which 72,000 Unlisted Shares will be converted to H Shares upon Listing) held by it
in its own capacity; and (ii) 10,931,558 Unlisted Shares in which Jiangfan Technology is deemed to be
interested as a result of being a party acting-in-concert with Mr. Tang and Mr. Sun.
(8) Zibo Caijin is a limited partner of Yingke Jiyun, which directly holds 24.5% of partnership interests of Yingke
Jiyun and is further deemed to be interested in 12.5% of partnership interests of Yingke Jiyun through its
interests in more than one-third of equity interests in Zibo Qilu Venture Capital Co., Ltd. ( ଍௹ᄁኁ௴ุҳ༟
ப΂ʮ̡) (being a limited partner holding 12.5% of partnership interests in Yingke Jiyun). In light of the
above and by virtue of the SFO, as Zibo Caijin is deemed to be interested in an aggregate of more than
one-third of the partnership interests in Yingke Jiyun, Zibo Caijin is deemed to be interested in the Shares held
by Yingke Jiyun.
Yingke Innovation is the general partner of Yingke Jiyun and Qingdao Yingke Value Venture Capital
Partnership (L.P.) (௴ุҳ༟ΥྫΆุ(Υྫ)) (“ Qingdao Yingke ”), which held 2,400,000
Unlisted Shares (among which 1,200,000 Unlisted Shares will be converted to H Shares upon Listing) and
1,250,000 Unlisted Shares (among which 625,000 Unlisted Shares will be converted to H Shares upon Listing),
respectively, as at the Latest Practicable Date. Further, more than one-third of the equity interests of Yingke
Innovation is held by Mr. Qian. As a result, by virtue of SFO, Mr. Qian and Yingke Innovation are deemed to
be interested in the Shares held by Yingke Jiyun and Qingdao Yingke.
(9) Chenqi Information is wholly owned by Mr. Shi. As a result, by virtue of SFO, Mr. Shi is deemed to be
interested in the Shares held by Chenqi Information.
(10) Qifeng Investment is the general partner of Jiaxing Shangyu Investment Partnership (Limited Partnership) ( ྗ
༃ҳ༟ΥྫΆุ(Υྫ)) (“ Jiaxing Shangyu ”) and Jiaxing Laida Investment Partnership (Limited
Partnership) ( ྗጳഺ༺ҳ༟ΥྫΆุ(Υྫ)) (“ Jiaxing Laida ”), which held 1,800,000 Unlisted Shares
(among which 1,300,000 Unlisted Shares will be converted to H Shares upon Listing) and 500,000 Unlisted
Shares (all of which will be converted to H Shares upon Listing), respectively, as at the Latest Practicable Date.
SUBSTANTIAL SHAREHOLDERS
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Qifeng Investment is in turn held as to approximately 54.50% and 45.50% by Mr. Zhao Qi ( Ⴛೡ) and Mr. Zhao
Fenggao ( Ⴛჾ৷), respectively. As a result, by virtue of the SFO, Mr. Zhao Qi ( Ⴛೡ), Mr. Zhao Fenggao ( Ⴛ
ჾ৷) and Qifeng Investment are deemed to be interested in the Shares held by Jiaxing Shangyu and Jiaxing
Laida.
Jiaxing Shangyu has two limited partners, with Ms. Gu Luying (ߵholding approximately 74.23% of the
partnership interest in Jiaxing Shangyu. As a result, by virtue of the SFO, Ms. Gu Luying (ߵis deemed
to be interested in the Shares held by Jiaxing Shangyu.
(11) Chengmeng (Shanghai) is the general partner of Jiaxing Chengshun Phase II, which is held as to 70% by Mr.
Fan Jue ( ᅾ䊌). As a result, by virtue of SFO, Mr. Fan Jue ( ᅾ䊌) and Chengmeng (Shanghai) are deemed to
be interested in the Shares held by Jiaxing Chengshun Phase II.
Further, Mianyang Xintou Dinghua is a limited partner holding 49.95% of the partnership interests in Jiaxing
Chengshun Phase II. Mianyang Xintou Dinghua is in turn held as to 0.1% by Chenguan Dinghua (being the
general partner of Mianyang Xintou Dinghua) and 99.9% by Mianyang Sci-Tech City New Area Investment
(being the limited partner of Mianyang Xintou Dinghua). Chenguan Dinghua is wholly owned by Zhongguan
Fitness Asset Management Co., Ltd. (ʮ̡)( “ Zhongguan Fitness AM ”) which is in
turn held as to 95% by Health and Sports Development Center of China Care for the Next Generation Working
Committee (ʕː). Mianyang Sci-Tech City New Area Investment is
held as to approximately 81.6% by Mianyang Science and Technology City New District Management
Committee (ึ). As a result, by virtue of SFO, Mianyang Xintou Dinghua, Chenguan
Dinghua, Zhongguan Fitness AM, the Health and Sports Development Center of China Care for the Next
Generation Working Committee, Mianyang Sci-Tech City New Area Investment and the Mianyang Science and
Technology City New District Management Committee are also deemed to be interested in the Shares held by
Jiaxing Chengshun Phase II.
In addition, Chenguan Dinghua is a general partner of Bodao Dinghua Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ)) (“ Bodao Dinghua ”), which held 750,000 Unlisted
Shares (among which 250,000 Unlisted Shares will be converted to H Shares upon Listing) as at the Latest
Practicable Date. As a result, by virtue of the SFO, Chenguan Dinghua, Zhongguan Fitness AM and the Health
and Sports Development Center of China Care for the Next Generation Working Committee are deemed to be
interested in the Shares held by Bodao Dinghua.
(12) For the avoidance of doubt, both Unlisted Shares and H Shares are ordinary Shares in the share capital of our
Company, and are considered as one class of Shares.
(13) The relevant Shareholder is ultimately under the supervision and management of the Shandong Provincial
People’s Government.
(14) The relevant Shareholder is ultimately under the supervision and management of the Sichuan Provincial
People’s Government.
Save as disclosed above and in “C. Further information about Directors, Supervisors and
substantial shareholders – 1. Disclosure of interests” in Appendix VI to this prospectus, our
Directors are not aware of any persons who will, immediately following completion of the
Global Offering (assuming the Over-allotment Option is not exercised), have interests and/or
short positions in Shares or underlying Shares which would fall to be disclosed 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 or any other member of our
Group.
SUBSTANTIAL SHAREHOLDERS
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--- page 385 ---
OVERVIEW
Our Board consists of ten Directors, comprising two executive Directors, four non-
executive Directors and four independent non-executive Directors. Pursuant to the Articles of
Association, our Directors are elected and appointed by our Shareholders at a Shareholders’
meeting for a term of three years, which is renewable upon re-election and re-appointment.
The following table sets forth certain information with respect to our Directors as at the
Latest Practicable Date:
Members of our Board:
Name Age
Position in
our Group
Date of
appointment
as a Director
Date of
joining our
Group
Main roles and
responsibilities in
our Group
Relationships
with other
Directors
or senior
management
Mr. Tang
Jinghua
(ಷหശ)
47 Chairman and
executive Director
December 5,
2005 (Note)
December 5,
2005
Responsible for the
overall strategy,
planning and
deployment, and
technology
research and
development of
our Company
None
Mr. Sun Qi
(೘)
49 Executive Director
and general
manager
April 26, 2015 October 10,
2012
Responsible for the
overall operation
and business
development of
our Group
None
Mr. Yang
Xiaoyuan
(เወ๕)
47 Non-executive
Director
May 28, 2018 May 28, 2018 Responsible for
providing
guidance and
advice on the
corporate and
business strategies
to the Board
None
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 386 ---
Name Age
Position in
our Group
Date of
appointment
as a Director
Date of
joining our
Group
Main roles and
responsibilities in
our Group
Relationships
with other
Directors
or senior
management
Mr. Tan
Xiaobo
(ت)
46 Non-executive
Director
April 19, 2019 April 19, 2019 Responsible for
providing
guidance and
advice on the
corporate and
business strategies
to the Board
None
Mr. Chen
Yulei
(௓ρཤ)
41 Non-executive
Director
May 8, 2021 May 8, 2021 Responsible for
providing
guidance and
advice on the
corporate and
business strategies
to the Board
None
Ms. Ma
Tiantian
(৵˂૴)
33 Non-executive
Director
May 8, 2021 May 8, 2021 Responsible for
providing
guidance and
advice on the
corporate and
business strategies
to the Board
None
Mr. Liu
Rong
(ᄎ࿰)
74 Independent
non-executive
Director
April 10, 2020 April 10, 2020 Responsible for
supervising and
providing
independent
advice to the
Board
None
Mr. Wu
Haipeng
(юऎᘄ)
44 Independent
non-executive
Director
June 30, 2021 June 30, 2021 Responsible for
supervising and
providing
independent
advice to the
Board
None
Mr. Mu
Binrui
(ϳⅳ๿)
67 Independent
non-executive
Director
November 4,
2021
November 4,
2021
Responsible for
supervising and
providing
independent
advice to the
Board
None
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 387 ---
Name Age
Position in
our Group
Date of
appointment
as a Director
Date of
joining our
Group
Main roles and
responsibilities in
our Group
Relationships
with other
Directors
or senior
management
Mr. Sinn
Wai Kin
Derek
(ᤑਃ਄)
65 Independent
non-executive
Director
June 16, 2023 June 16, 2023 Responsible for
supervising and
providing
independent
advice to the
Board
None
Note:
Mr. Tang served as our Director between December 2005 and June 2017, and was subsequently reappointed as our
Director in December 2020. Since December 2005, Mr. Tang has also been serving as our technical director.
The following sets forth the biographies of our Directors:
Executive Directors
Mr. Tang Jinghua ( ಷหശ), aged 47, is our founder, chairman of the Board and
executive Director. Mr. Tang served as the chairman and general manager of the Company
between December 2005 and June 2017. He was subsequently re-appointed as our Director in
December 2020 and as chairman of the Board in June 2021, and was re-designated as our
executive Director in May 2023. In addition, Mr. Tang has been our technical director since
December 2005 and is currently the director of several of our subsidiaries, including, Shandong
V oicecomm Intelligent Technology, Shandong V oicecomm Information Technology and Hainan
V oicecomm Intelligent Technology. He is primarily responsible for the overall strategy,
planning and deployment, and technology research and development of our Company.
Mr. Tang has over 20 years of extensive research and development experience in the
industry and has expertise in the field of conversational AI. Mr. Tang has led and completed
the research and development of software products for National Natural Science Foundation of
China (ږand Shanghai Sci-Tech Innovation Center Capital (ږ)
for numerous times. The products which were developed under the leadership of Mr. Tang have
received numerous renowned honours and awards, including the “Shanghai Sci-tech
Achievements Award”.
Prior to establishing our Group, Mr. Tang served as product manager at the technical
department of Shanghai Shengruan Message Technology Co., Ltd. (ʮ
̡) between January 2002 and November 2005, where he was responsible for the development
and application of computer telephony integration technology.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Mr. Tang founded our Company in December 2005 and served as our director and general
manager at the material time back then. Between September 2016 and October 2018, pursuant
to the invitation by Xinhuanet, Mr. Tang joined Xinhuanet Yilian (Beijing) Technology Co.,
Ltd. ( อശၣᄂஹ(̏ԯ)ப΂ʮ̡)( “Xinhuanet Yilian ”) as a deputy general manager,
and was responsible for the industrial implementation of “Internet Plus” strategy. At the
relevant time, Xinhuanet Yilian and our Company were strategic cooperation partners to
develop and promote cloud-based communication platform for intelligent town projects
through joint efforts. At the request of Xinhuanet Yilian that Mr. Tang shall not hold
directorship outside the group of Xinhuanet after his relevant appointment, Mr. Tang resigned
as a director of our Company in June 2017.
During his tenure as the deputy general manager of Xinhuanet Yilian, Mr. Tang further
expanded the upstream and downstream industry chain partners, established business
cooperation networks and ecosystems, and deepened the implementation of the “Internet Plus”
strategy to accumulate first-hand project experiences. Through these experiences accumulated
during his tenure in Xinhuanet Yilian, Mr. Tang could bring to our Group his deepened
understanding of the needs of different stakeholders along the industry chain as well as his
broadened business connections, which would enable our Group to further improve our
solution offerings to more closely cater for our customers’ needs. Further, Mr. Tang’s first hand
experience in the implementation of the “Internet Plus” strategy could be translated into and
facilitate the execution of our intelligent town projects. All in all, Mr. Tang’s tenure in
Xinhuanet Yilian is considered beneficial to the future development of our Group. In October
2018, Mr. Tang resigned from his position as deputy general manager in Xinhuanet Yilian to
focus on the business operation and technology research and development of our Company.
Notwithstanding the above, Mr. Tang has been serving as our technical director since
December 2005 and up to the Latest Practicable Date (including since Mr. Tang’s resignation
as our Director in June 2017 and up to his re-appointment as Director in December 2020),
whereby Mr. Tang continued to oversee the operation of our Group together with Mr. Sun, and
was responsible for leading the research and development of our solution offerings and our
technical management work, formulating our path in technology development in accordance
with our overall strategic business development plan and market demands, and determining the
direction of development of our solution offerings.
Mr. Tang obtained a master degree in software engineering from Shanghai Jiao Tong
University ( ɪऎʹஷɽኪ) in the PRC in March 2005, and is currently a PhD candidate in
artificial intelligence at Shanghai Jiao Tong University ( ɪऎʹஷɽኪ) in the PRC, with a
research focus on distributed artificial intelligence and knowledge graph.
Mr. Tang was a director and a general manager of Hangzhou Bojue Network Technology
Co., Ltd. (ʮ̡)( “ Hangzhou Bojue ”), a company established in the
PRC engaged in the business of software application development and system integration. The
business license of Hangzhou Bojue was revoked on June 25, 2019 as it was not engaging in
any business activities for more than six months prior to the date of revocation. As confirmed
by Mr. Tang, he had already resigned from his positions as the director and general manager
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 389 ---
of Hangzhou Bojue before 2019, which was confirmed by the board of Hangzhou Bojue in
February 2019, and he had not been actively involved in the operation of Hangzhou Bojue
since his resignation. As confirmed by Mr. Tang, Hangzhou Bojue was solvent at the time of
his resignation, there was no fraudulent act or misfeasance on the part of Mr. Tang leading to
the revocation and he was not aware of any actual or potential claim that has been or will be
made against him as a result of the revocation of business license of Hangzhou Bojue.
Mr. Sun Qi (೘), aged 49, is our executive Director and general manager. Mr. Sun
joined our Group in October 2012 as the sales director of our Company. He has been our
Director since April 2015 and the general manager of our Company since January 2017, and
he was re-designated as our executive Director in May 2023. He is currently the director of
several of our subsidiaries, including V oicecomm Jiachen, Shandong V oicecomm Information
Technology and V oicecomm Yilian. He is primarily responsible for the overall operation and
business development of our Group.
Mr. Sun has 20 years of rich experience in sales and marketing. Prior to joining our
Group, Mr. Sun served as (i) the deputy general manager of the Shanghai branch of Shenzhen
Kingdom Sci-tech Co., Ltd. (a company listed on the Shanghai Stock Exchange (stock code:
600446)) from September 1998 to September 2002; (ii) the sales manager of Eastern China
Region at Gaoyang Soft-tech Information Technology (Shanghai) Co., Ltd (Ҧஔ
(ɪऎ)ʮ̡)) from November 2003 to August 2005, where he was responsible for the sales
and marketing activities of the company in the Eastern China Region; and (iii) the co-founder
and the deputy general manager at Shanghai Lingteng Network Technology Co., Ltd ( ɪऎᜳ
ʮ̡) from October 2005 to September 2012, where he was responsible for the
daily management and channel expansion of the company.
Mr. Sun graduated from Hefei University of Technology (ʈุɽኪ) in the PRC after
completion of the undergraduate programme in engineering in July 1997.
Non-executive Directors
Mr. Y ang Xiaoyuan ( เወ๕), aged 47, is our non-executive Director. Mr. Yang joined
our Group in May 2018 and has been our Director since then. He was subsequently
re-designated as our non-executive Director in May 2023. Mr. Yang is primarily responsible for
providing guidance and advice on the corporate and business strategies to the Board.
Mr. Yang worked at Shanghai Potevio Co., Ltd (ʮ̡) from
September 1999 to May 2006 where he last served as the marketing director. In October 2005,
Mr. Yang founded Beijing Haizhide Technology Co., Ltd (ʮ̡), a
company in the scientific research and technical service industry. In January 2016, Mr. Yang
founded Shanghai Jiangcheng Asset Management Co., Ltd (ʮ̡), a
company primarily engaging in, among others, asset management, where his current position
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 390 ---
is general manager. He is also currently serving as the director or supervisor of various
subsidiaries of Shanghai Jiangcheng Asset Management Co., Ltd, the operation of which
include information technology, leasing of non-residential properties and corporate
management, etc.
Mr. Yang graduated from Donghua University (ശɽኪ) (formerly known as China
Textile University ( ʕ਷५ᔌɽኪ) in the PRC with a bachelor’s degree in industrial automation
in July 1999, and subsequently obtained a master degree in electronics and communication
engineering from Shanghai Jiao Tong University ( ɪऎʹஷɽኪ) in the PRC in March 2008.
Mr. Tan Xiaobo (ت)aged 46, is our non-executive Director. Mr. Tan joined our
Group in April 2019 and has been our Director since then. He was subsequently re-designated
as our non-executive Director in May 2023. Mr. Tan is primarily responsible for providing
guidance and advice on the corporate and business strategies to the Board.
Mr. Tan served as the general manager at Shanghai Softstone International Trading Co.,
Ltd (ʮ̡) from February 2002 to January 2017. Since January 2017,
Mr. Tan has been working at Shanghai Zepure International Trading Co., Ltd ( ɪऎዣ๙਷ყ
ʮ̡) (a company principally engaged in the import and distribution of plastics and
chemicals) and he is currently serving as its executive director and general manager.
Mr. Tan graduated from Shanghai Ocean University (ɽኪ) (formerly known as
Shanghai Fisheries University ( ɪऎ˥ପɽኪ) in the PRC upon completion of the
undergraduate programme in mechanical design and manufacturing and automation in July
2000.
Mr. Chen Yulei ( ௓ρཤ), aged 41, is our non-executive Director. Mr. Chen joined our
Group in May 2021 and has been our Director since then. He was subsequently re-designated
as our non-executive Director in May 2023. Mr. Chen is primarily responsible for providing
guidance and advice on the corporate and business strategies to the Board.
Mr. Chen is experienced in the investment field, including in the technology, media and
telecommunication (TMT) area. From April 2016 to April 2019, Mr. Chen worked at Shanghai
Baoju Investment Management Group Co., Ltd. (ʮ̡), where
his last held position was investment director. From November 2019 to September 2023, Mr.
Chen worked at Yingke Innovation Asset Management Co., Ltd. (ʮ̡),
and is served as one of the partners and the chief investment officer, where he was primarily
responsible for investment in the technology and innovation industry. In particular, Mr. Chen
had handled several investment projects in the TMT field, including (i) a company listed on the
Shanghai Stock Exchange that provides foundry services for analog chips and module
packaging, (ii) a company established in the PRC which engaged in the research, production,
sales, and recycling of sputtering targets and evaporative materials for vacuum coating, the
products of which are primarily used in the fields of display, photovoltaics and data storage,
etc., (iii) an enterprise engaged in the research, production, and sales of new energy intelligent
connected vehicles, and (iv) a chip manufacturing company, whose products are applied in the
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 381 –


--- page 391 ---
fields of, among others, internet of things (IOT), automotive electronics, and 5G etc. Mr. Chen
served as the vice president and regional manager of the Industrial Fund Department in the East
China region at Shanghai Fudi Industrial Development Group Co., Ltd. (ණ
ʮ̡) from September 2023 to December 2023. Since April 2024, Mr. Chen has been
working at Hangzhou Xingyu Enterprise Management Consulting Co., Ltd. (ѹΆุ၍
ʮ̡) and he is currently serving as the head of the Investment Business Center.
Mr. Chen graduated from Ningbo University (ɽኪ) in the PRC with a bachelor’s
degree in computer science and technology in July 2005, and subsequently graduated from
University of Keele in the United Kingdom with a master’s degree in financial management in
November 2006.
Ms. Ma Tiantian ( ৵˂૴), aged 33, is our non-executive Director. Ms. Ma joined our
Group in May 2021 and has been our Director since then. She was subsequently re-designated
as our non-executive Director in May 2023. Ms. Ma is primarily responsible for providing
guidance and advice on the corporate and business strategies to the Board.
Ms. Ma worked as an institutional sales at Tebon Fund Management Co., Ltd (ږ
ʮ̡) from October 2015 to July 2016. She then served as a project manager at
Dongyang Datang Entertainment TV and Film Production Co., Ltd (΅Ϟ
ʮ̡) from February 2017 to September 2018. From December 2018 to October 2020, she
served as the executive director at Shanghai Yueran Culture Communication Co., Ltd ( ɪऎᚔ
ʮ̡). Since October 2020, Ms. Ma has been working at Gongqingcheng
Softbank Zhongan Investment Co., Ltd (ʮ̡) and her current
position is supervisor and development manager.
Ms. Ma graduated from University of Sydney in Australia with a bachelor’s degree in
economics in May 2013, and subsequently obtained a postgraduate in business management
from University of Technology Sydney in Australia in March 2015.
Independent non-executive Directors
Mr. Liu Rong ( ᄎ࿰), aged 74, is our independent non-executive Director. Mr. Liu has
been appointed as our independent Director since April 2020, and was subsequently
reconfirmed as our independent non-executive Director in May 2023. Mr. Liu is primarily
responsible for supervising and providing independent advice to the Board.
Mr. Liu worked at SAIC Motor Industrial (Group) Co., Ltd. ( ɪऎӛԓʈุ(ණྠ)ʮ
̡) between April 1990 and December 2004, during which he served various positions
including manager assistant of the finance department (asset operation department), deputy
manager, deputy chief accountant and manager of the asset operation department. Subsequently
between December 2004 and May 2013, Mr. Liu served in various positions at SAIC Motor
Corp., Ltd. (ʮ̡) (a company listed on the Shanghai Stock Exchange
(stock code: 600104), and a company controlled by ɪऎӛԓʈุ(ණྠ)ʮ̡)),
including deputy chief accountant and chief operation officer. Mr. Liu is currently an
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 392 ---
independent director of Shanghai Lianming Machine Share Co., Ltd (ʮ
̡) (a company listed on the Shanghai Stock Exchange (stock code: 603006)), Shanghai Naen
Automotive Technology Co., Ltd (΅ʮ̡), Kuangda Technology Co. Ltd.
(ʮ̡) (a company listed on the Shenzhen Stock Exchange (stock code:
002516)) and Hangzhou BOSOM New Materials Technology Co., Ltd (ٰ
ʮ̡). He was an independent director of (i) Shanghai Jingzhi Enterprise Co., Ltd ( ɪ
ʮ̡) (a company quoted on National Equities Exchange and Quotations
(stock code: 873842) from March 2020 to March 2023; and (ii) Flying Technology Co., Ltd.
(ʮ̡) (a company listed on the Shanghai Stock Exchange (stock code:
603488) between December 2020 to August 2022.
Mr Liu has been awarded the “Advanced Production Work (٫by SAIC
Motor Corporation Limited in March 2007 and the “Advanced Accountant in Shanghai ( ɪऎ
٫awarded by Shanghai Municipal Finance Bureau in August 2009.
Mr. Liu completed the training programme in accounting in Shanghai First Mechanical
and Electrical Industry Bureau ( ɪऎ̹ୋɓዚཥʈุ҅) in the PRC in June 1981. Mr. Liu
subsequently graduated from the international finance and commerce college class of Institute
of Adult Education of East China Normal University (ᇍɽኪϓɛ઺ԃኪ৫) in the PRC
in July 1997 and completed the on-the-job postgraduate course majoring in global economy at
the International Finance Department of East China Normal University (ᇍɽኪ)i nt h e
PRC in April 1999.
Mr. Liu earned the qualification of senior accountant in Shanghai in April 2002. Mr. Liu
was also certified as having 30 years’ experience in accounting by the Ministry of Finance of
the People’s Republic of China (௅) in August 2008.
Mr. Wu Haipeng ( юऎᘄ), aged 44, is our independent non-executive Director. Mr. Wu
has been appointed as our independent Director since June 2021, and was subsequently
reconfirmed as our independent non-executive Director in May 2023. Mr. Wu is primarily
responsible for supervising and providing independent advice to the Board.
Mr. Wu served at Fujian Mintian Law Firm (הfrom September 2001
to June 2010 and his last position was partner. Mr. Wu then served as a partner at Fujian Junli
Law Firm (הfrom July 2010 to December 2017. Mr. Wu is currently a
partner at Grandall (Fuzhou) Law Firm (ࢪܛ(၅ψ)הHe is also currently an
independent director of Nanjing Aolian Automobile Electronics Co., Ltd (ԯෳᑌӛԓཥɿཥ
ʮ̡) (a company listed on the Shenzhen Stock Exchange (stock code: 300585)).
Mr. Wu graduated from Jilin University (ɽኪ) in the PRC with a bachelor’s degree
in the law of International Economics in June 2001. He is a registered lawyer in the PRC.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 393 ---
Mr. Mu Binrui ( ϳⅳ๿), aged 67, is our independent non-executive Director. Mr. Mu has
been appointed as our independent Director since November 2021, and was subsequently
reconfirmed as our independent non-executive Director in May 2023. Mr. Mu is primarily
responsible for supervising and providing independent advice to the Board.
Before his retirement in 2016, Mr. Mu worked at the Bank of Communications Co., Ltd.
(ʮ̡) (a company listed on the Shanghai Stock Exchange (stock code:
601328)), during which he was appointed as general manager in the credit management
department in October 2004 and as the vice chief credit executive officer in March 2013. He
is currently an independent non-executive director of China Yongda Automobiles Services
Holdings Limited (ʮ̡) (a company listed on the Stock Exchange
(Stock code: 3669) and China Bohai Bank Co., Ltd (ʮ̡) (a company listed
on the Stock Exchange (Stock Code: 9668).
Mr. Mu graduated from the School of Network Education of Renmin University of China
(ʕ਷ɛ͏ɽኪၣഖ઺ԃኪ৫) in the PRC after completion of the long distance course majoring
in finance in March 2005.
Mr. Mu has earned the honour of Special Allowances of the State Council as a National
Expert (࢕awarded by The State Council ( ʕശɛ͏΍ձ਷਷ਕ৫)i n
February 2013.
Mr. Sinn Wai Kin Derek ( ᤑਃ਄), aged 65, is our independent non-executive Director.
Mr. Sinn has been appointed as an independent non-executive Director since June 2023. He is
primarily responsible for supervising and providing independent advice to the Board.
Mr. Sinn is a fellow member of the Hong Kong Institute of Certified Public Accountants
since 1999, and has experience in audit, accounting, financial management and corporate
finance, in particular, Mr. Sinn served as an executive director of New Spring Holdings Limited
(ʮ̡) (currently known as Uni-Bio Science Group Limited (Ҧණ
ʮ̡), a company listed on the Main Board of the Stock Exchange (stock code: 0690),
between November 2001 and March 2003; Mr. Sinn served as the deputy financial controller
of Lee & Man Paper Manufacturing Limited (ʮ̡) (a company listed on the
Main Board of the Stock Exchange (stock code: 2314)) between August 2006 and September
2008; Mr. Sinn served as the chief financial officer and company secretary of Huajun Holdings
Limited (ʮ̡) (currently known as China Huajun Group Limited ( ʕ਷ശёණྠ
ʮ̡), a company listed on the Main Board of the Stock Exchange (stock code: 0377))
between September 2008 and August 2015; Mr. Sinn served as the chief financial officer of
Enviro Energy Management Services Limited (ʮ̡) between September
2015 and December 2015 and company secretary of Enviro Energy International Holdings
Limited (ʮ̡) between October 2015 and December 2015; and Mr. Sinn
served as the independent non-executive director of Han Tang International Holdings Limited
(ʮ̡) (a company formerly listed on the Main Board of the Stock Exchange
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(stock code: 1187) between July 2016 and June 2018. Mr. Sinn is currently the financial
consultant of a company primarily engaged in the field of hospital information systems and
medical internet-of-things (IoT). Mr. Sinn completed secondary education in Hong Kong in
1981.
Mr. Sinn was a director of Kam Pang Engineering Limited (ʮ̡), a
company incorporated in Hong Kong engaged in the business of engineering consultation. The
said company was struck off by the Registrar of Companies in Hong Kong and was dissolved
on December 30, 2016 pursuant to Section 746(2) of the Companies Ordinance (Chapter 622
of the Laws of Hong Kong). As confirmed by Mr. Sinn, the said company did not have
substantial business and was solvent at the time of struck off and dissolution, no claims had
been made against him and he was not aware of any threatened and/or potential claims made
against him as a result of the dissolution of the said company.
SUPERVISORY COMMITTEE
Our Supervisory Committee consists of three members, including two Supervisors
appointed by shareholders’ general meetings and one employee representative Supervisor,
elected at employee representative meetings. Our Supervisory Committee is responsible for
supervising the performance of duty of the Board and the senior management of our Company
and overseeing the financial, internal control and risk conditions of our Company. The
Supervisors serve a term of three years and may be re-elected for successive reappointments.
The following table sets out certain information with respect to members of our Supervisory
Committee as at the Latest Practicable Date:
Name Age Title
Date of
joining our
Group
Date of
appointment
as Supervisor
Main roles and
responsibilities
in our Group
Relationships
with other
Directors
or senior
management
Ms. Wu Yongzheng
(݁)
47 Chairman of
Supervisory
Committee
June 7, 2011 April 26, 2015 Supervising the
Board and
management
None
Ms. Xu Xiaodi
(ࠔ)
30 Supervisor April 26, 2015 April 26, 2015 Supervising the
Board and
management
None
Mr. Xiao Dong
(؇)
36 Employee
representative
supervisor
October 19,
2012
February 29,
2016
Supervising the
Board and
management
None
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Ms. Wu Y ongzheng (݁)aged 47, is our chairman of the Supervisory Committee.
Ms. Wu joined our Company in June 2011 and has been the chairman of the Supervisory
Committee since May 7, 2015. She is also the supervisor of the Shandong V oicecomm
Intelligent Technology.
Prior to joining our Group, Ms. Wu worked (i) as a technical engineer at Shanghai
Camelot Information System Co., Ltd. (ʮ̡) between July 2004 and
April 2006, where her clientele included a multinational technology corporation; and (ii) at
China HP Co., Ltd. (ʮ̡) (formerly known as China Hewlett-Packard Co., Ltd.
(Ҧ(̏ԯ)ʮ̡)), where her last held position was systems administrator before her
resignation in November 2010.
Ms. Wu graduated from Chinese People’s Liberation Army Guilin Military Academy (࣭
ኪ৫) in the PRC majoring in computer application in June 1999. Ms. Wu subsequently
graduated from Shanghai Polytechnic University ( ɪऎୋɚʈุɽኪ) in the PRC majoring in
computer science (adult higher education) through part-time study in January 2009. Ms. Wu
obtained a master degree of software engineering from Tongji University ( Ν᏶ɽኪ)i nt h e
PRC in March 2017.
Ms. Wu received the First prize for scientific progress awarded by Beihai People’s
Government Science and Technology Progress Award Review Committee (ኪҦஔආӉᆤ൙
ึ) in January 2001.
Ms. Xu Xiaodi (ࠔ)aged 30, is our supervisor. Ms. Xu joined our Company in April
2015 and has been our supervisor since then. She is also the general manager of the V oicecomm
Jiachen and the supervisor of the Hainan V oicecomm Intelligent Technology.
In addition to her role as supervisor of our Company, Ms. Xu served as an administrator
and sales assistant at our Company from April 2015 to September 2018, and later as assistant
general manager of our Company since February 2021.
Ms. Xu obtained online college degree of economic management from Huazhong
University of Science and Technology (Ҧɽኪ) in the PRC in January 2015, and
completed her undergraduate studies in Huazhong Normal University (ᇍɽኪ)i nt h e
PRC majoring in business administration in January 2021 through an online program.
Mr. Xiao Dong (؇)aged 36, is our employee representative supervisor. Mr. Xiao has
been our employee representative supervisor since February 2016.
Mr. Xiao joined our Group in October 2012 and has been serving as the system integration
engineer of the technical department of our Company since August 2017, where he was
responsible for the project research and development of the technical department.
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Mr. Xiao graduated from Southwest University of Science and Technology (Ҧɽ
ኪ) in the PRC upon completion of an online education undergraduate program on computer
science and technology in January 2017.
SENIOR MANAGEMENT
Members of our senior management
Our senior management, together with our executive Directors, is responsible for the
day-to-day management of our business. The following table sets out certain information with
respect to members of our senior management as at the Latest Practicable Date:
Name Age Position(s)
Date of
appointment
as senior
management
Date of joining
our Group
Main roles and
responsibilities
in our Group
Relationships
with other
Directors
or senior
management
Mr. Zheng Bo
(ت)
47 Deputy general
manager and
deputy director
of technical
department
May 7, 2023 February 1, 2021 Responsible for
assisting in
overseeing the
day-to-day
operation of the
technical
department
None
Mr. Ouyang Yiqing
(ڡ)
45 Deputy general
manager
November 3,
2023
June 5, 2023 Responsible for
formulating and
implementing
marketing
strategies and
client success
None
Mr. Zhang Wenzhao
(ੵ˖১)
46 Chief financial
officer
November 30,
2022
November 16,
2022
Responsible for
overseeing the
finance and
accounting
matters and
financial
reporting of our
Group
None
Ms. Liu Yihan
(ᄎᖵ଄)
39 Secretary of the
Board and joint
company
secretary
June 8, 2021 June 4, 2021 Responsible for
the equity
financing and
listing
preparation
works of our
Company
None
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Mr. Zheng Bo (ت)aged 47, is our deputy general manager and technical deputy
director. Mr. Zheng has been our technical deputy director since February 2021. Mr. Zheng Bo
was further appointed as our deputy general manager since May 2023. He is primarily
responsible for assisting in supervising the day-to-day operation of the technical department.
Prior to joining our Group in 2021, Mr. Zheng served (i) at Shanghai Lingteng Network
Technology Co., Ltd. (ʮ̡) as the chief technology officer between
May 2007 and September 2010, where he was responsible for leading the daily operation of the
technical department; (ii) at Jiangxi Nanchang High-tech District Talent Center between
October 2010 and January 2014, where he was responsible for the establishment of network
and information system; (iii) at our Company as our chief technology officer between February
2014 and May 2017; and (iv) as the vice president at Hefei Yipin Science and Trade Co., Ltd.
(ʮ̡) between February 2020 and January 2021.
Mr. Zheng graduated from Nanchang University (ɽኪ) in the PRC upon completion
of the undergraduate programme of computer and application in July 1998.
Mr. Ouyang Yiqing (ڡ)aged 45, is our deputy general manager. Mr. Ouyang
joined our Group in June 2023 and has been our deputy general manager since November 2023.
He is primarily responsible for formulating and implementing marketing strategies and client
success.
Mr. Ouyang possesses extensive experience in serving B2B enterprises and government-
enterprises, and had helped several leading Chinese companies and government institutions in
industries such as healthcare, education, publishing, and government achieve digital
transformation. Prior to joining our Group, Mr. Ouyang served in various software and
technology companies from 2005 to 2014, where he was principally responsible for sales and
business development. From September 2014 to November 2020, Mr. Ouyang served as
general manager of public services industry group at SAP (China) Co. Ltd (ฌ౷(ʕ਷)ࠢ
ʮ̡), where he was responsible for the formulation and implementation of marketing
strategies and client success. Subsequently between November 2020 and June 2023, Mr.
Ouyang served as senior sales director at Fourth Paradigm (Beijing) Data & Technology Co.,
Ltd. ( ୋ̬ᇍό(̏ԯ)ʮ̡) (a subsidiary of Beijing Fourth Paradigm Technology Co.,
Ltd. (ʮ̡), a company listed on the Stock Exchange (Stock
Code: 6682)), where he was responsible for business development of the company’s innovative
business and client success. Mr. Ouyang also served as an executive director of Shanghai
Paradigm Digital Software Technology Co. Ltd. (ʮ̡)( a
subsidiary of Fourth Paradigm (Beijing) Data & Technology Co., Ltd.) from July 2022 to
August 2023.
Mr. Ouyang graduated from the Dundalk Institute of Technology in Ireland in June 2005
with a bachelor’s degree in business.
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Mr. Zhang Wenzhao ( ੵ˖১), aged 46, is our chief financial officer. Mr. Zhang joined
our Group in November 2022 and has been our chief financial officer since then. He is
primarily responsible for overseeing the finance and accounting matters and financial reporting
of our Group.
Prior to joining our Group, Mr. Zhang had worked at the accounting and financial field,
for instance he had (i) worked in accounting at Hulunbeier Branch of China Netcom (Group)
Co., Ltd. ( ʕ਷ၣஷ(ණྠ)Ԏဧ̹ʱʮ̡) between July 2003 and August 2005;
(ii) served as a finance officer at Shanghai Metersbonwe Fashion & Accessories Co., Ltd. ( ɪ
ʮ̡) (a company listed on the Shenzhen Exchange (stock code:
002269)) between March 2006 and December 2008; (iii) served as a finance manager of
Shanghai Metersbonwe Fashion & Accessories Sales Co., Ltd. (ࠢ
ʮ̡) between December 2008 and September 2010; (iv) served as a financial manager at
Xijiewei (Shanghai) Enterprise Management Co., Ltd. (ၪ(ɪऎ)ʮ̡)
between October 2012 and June 2018; and (v) served as the financial controller at Shanghai
Zhitong Construction Development Co., Ltd. (ʮ̡) (a company
quoted on the National Equities Exchange and Quotations (stock code: 831395)) from October
2020 to November 2022.
Mr. Zhang graduated from Inner Mongolia Finance and Economics College ( ʫႆ̚ৌ຾
ኪ৫, currently known as Inner Mongolia University of Finance and Economics ( ʫႆ̚ৌ຾
ɽኪ)) in the PRC in July 2003 with a bachelor’s degree in business administration.
Mr. Zhang obtained (i) the tax advisor qualification issued by The China Certified Tax
Agents Association (՘ึ) in November 2019 and (ii) the Certificate for
Passing All the Required Subjects of the National Uniform CPA Examination (Ό
ᗇ) in December 2020 from The Certified Public Accountant Examination
Committee of The Ministry of Finance of the PRC (ึ).
Ms. Liu Yihan ( ᄎᖵ଄), aged 39, is our secretary of the Board and one of our joint
company secretaries. Ms. Liu joined our Group in June 2021 and has been our secretary of the
Board since then. She is subsequently appointed as one of the joint company secretaries of the
Company in May 2023 with effect upon the Listing Date. After joining our Group, Ms Liu is
primarily responsible for the equity financing and listing preparation works of the Company,
including the Series B, Series B+ and Series C Financing (the Pre-IPO Investments in our
Company). Ms. Liu has years of experience as IPO projects consultant, full-time stock trader
in secondary market, and corporate senior management.
Ms. Liu graduated from Jilin University (ɽኪ) in the PRC in July 2007 with two
bachelor’s degrees in engineering, and received a master of Laws degree from Peking
University in the PRC and a degree of Juris Doctor conferred by Peking University School of
Transnational Law in July 2018.
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None of our Directors and senior management members are related to other Directors or
members of our senior management. Save as disclosed above, none of our Directors and senior
management members held any directorship in public companies, whose securities were listed
on any securities market in Hong Kong or overseas in the three years immediately preceding
the date of this Prospectus. Save as disclosed above, to the best knowledge, information and
belief of our Directors having made all reasonable enquiries, there are no other matters in
respect of our Directors that are required to be disclosed pursuant to Rule 13.51(2)(a) to (v) of
the Listing Rules, and there is no other material matter relating to our Directors that needs to
be brought to the attention of our Shareholders.
JOINT COMPANY SECRETARIES
Ms. Liu Yihan ( ᄎᖵ଄) is one of our joint company secretaries. For biographical details
of Ms. Liu, see “– Senior Management” in this section.
Mr. Cheung Kai Cheong Willie (׹)aged 49, is one of our joint company
secretaries. Mr. Cheung was appointed as the other joint company secretary of our Company
in May 2023 with his appointment taking effect upon the Listing Date. Mr. Cheung is a senior
manager of SWCS Corporate Services Group (Hong Kong) Limited mainly responsible for
assisting listed companies in professional company secretarial work. Prior to joining SWCS
Corporate Services Group (Hong Kong) Limited, Mr. Cheung served as the company secretary
of certain companies, each of which is listed on the Stock Exchange.
Mr. Cheung is a fellow member of the Hong Kong Institute of Certified Public
Accountants and the Association of Chartered Certified Accountants in the United Kingdom.
Mr. Cheung obtained a bachelor’s degree of Arts (Honors) in Accounting and Finance at
the University of Glamorgan in the United Kingdom in June 1996.
BOARD COMMITTEES
Our Board delegates certain responsibilities to various committees. In accordance with
the relevant PRC laws and regulations and the Corporate Governance Code, Appendix C1 to
the Listing Rules, our Company has established four Board committees, namely the audit
committee, the remuneration committee, the nomination committee and the strategy
committee.
Audit Committee
We have established an Audit Committee with written terms of reference in accordance
with Rule 3.21 of the Listing Rules and the Corporate Governance Code as set out in Appendix
C1 to the Listing Rules. The Audit Committee comprises two independent non-executive
Directors and one non-executive Director, namely Mr. Sinn Wai Kin Derek, Mr. Wu Haipeng
and Mr. Yang Xiaoyuan, and is chaired by Mr. Sinn Wai Kin Derek. The primary duties of the
audit committee are to assist our Board by providing an independent view of the effectiveness
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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of the financial reporting process, risk management and internal control systems of our Group,
to oversee the audit process, to develop and review our policies, to make recommendations to
our Board on the appointment and dismissal of the external auditors, and to perform other
duties and responsibilities as assigned by our Board.
Remuneration Committee
We have established a Remuneration Committee with written terms of reference in
compliance with Rule 3.25 of the Listing Rules and the Corporate Governance Code as set out
in Appendix C1 to the Listing Rules. The Remuneration Committee comprises one executive
Director and two independent non-executive Directors, namely Mr. Tang Jinghua, Mr. Liu
Rong, and Mr. Sinn Wai Kin Derek, and is chaired by Mr. Liu Rong. The primary duties of the
remuneration committee are to establish and review the policy and structure of the
remuneration for our Directors, Supervisors and senior management, review and approve our
management’s remuneration proposals with reference to our Board’s corporate goals and
objectives, ensure none of our Directors determine their own remuneration, and make
recommendations on employee benefit arrangement.
Nomination Committee
We have established a Nomination Committee with written terms of reference in
compliance with the Corporate Governance Code as set out in Appendix C1 to the Listing
Rules. The Nomination Committee comprises one executive Director and two independent
non-executive Directors, namely Mr. Tang Jinghua, Mr. Mu Binrui and Mr. Liu Rong and is
chaired by Mr. Mu Binrui. The primary duties of the nomination committee are to review the
structure, size and composition (including the skills, knowledge and experience) of our Board
at least annually and make recommendation to our Board on any proposed changes to our
Board to complement our Company’s corporate strategy; identify individuals suitably qualified
as potential board members and select or make recommendations to our Board on the selection
of individuals nominated for directorships; assess the independence of independent non-
executive Directors; and make recommendations to our Board on the appointment or
reappointment of Directors and succession planning of Directors, in particular that of our
chairman.
Strategy Committee
We have established a Strategy Committee comprising three Directors, namely Mr. Tang
Jinghua, Mr. Sun Qi and Mr. Chen Yulei and is chaired by Mr. Tang Jinghua. The primary
duties of the Strategy Committee are to, among others, study and advise on the long-term
development strategy planning of our Company.
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BOARD DIVERSITY POLICY
With a view to achieving sustainable and balanced development, we have adopted a board
diversity policy (the “ Board Diversity Policy ”) to achieve diversity in our Board. The Board
Diversity Policy sets out the objective of and approach by our Board to achieve and maintain
diversity in our Board in order to enhance the effectiveness of our Board and recognises and
embraces the benefits of diversity in our Board. We endeavour to ensure that our Board
members have the appropriate balance of skills, experience and diversity of perspectives that
are required to support the implementation of our business strategy. Pursuant to the Board
Diversity Policy, we seek to achieve Board diversity through the consideration of a number of
factors, including but not limited to gender, age, cultural and educational background,
professional experience, skills, knowledge and length of service and any other factors that our
Board may consider relevant and applicable from time to time. The ultimate decision of the
appointment will be based on merit and the contribution which the selected candidates will
bring to our Board. Our Board believes that such merit-based appointments will enable our
Company to best serve our Shareholders and other stakeholders going forward.
Our Board currently comprises ten Directors, including two executive Directors, four
non-executive Directors and four independent non-executive Directors. Our Directors have a
balanced mix of experiences, including overall management and strategic development,
marketing and business development, and finance and accounting experiences in addition to
experience in the full-stack enterprise-level conversational AI solution market. For instance,
our executive Directors, Mr. Tang (the chairman of the Board and an executive Director) and
Mr. Sun (the general manager and an executive Director), both of whom being the steersmen
of our Group, possessed substantial relevant industry experience in the conversational AI
market and in the field of sales and marketing. We have four non-executive Directors and four
independent non-executive Directors with different industry backgrounds, including in the
equity investment, corporate management, accounting, finance and legal fields, and our
independent non-executive Directors represent more than one-third of the members of our
Board. Our Board believes that the female representation in our Board, a mix of different
background and experiences of our Directors and the age diversity, would enable our Directors
to bring in valuable views and opinions of different perspectives, which could enhance the
quality of decision making of our Board and benefit our Group as a whole. Based on the
foregoing, we consider our current Board composition satisfies the principles set out in the
Board Diversity Policy.
Our nomination committee will review the composition of our Board and identify and
recommend suitable candidates to our Board from time to time and make recommendations as
to the appointment of members of our Board in accordance with our Board Diversity Policy.
Our Company will also take into consideration factors based on our Group’s business model
and specific needs from time to time in determining the optimum composition of our Board.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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CORPORATE GOVERNANCE
We are committed to high standards of corporate governance with a view to safeguarding
the interests of our Shareholders. To accomplish this, we will comply with the corporate
governance requirements under the Corporate Governance Code and Corporate Governance
Report set out in Appendix C1 to the Listing Rules after the Listing.
REMUNERATION POLICY
Our Directors, Supervisors and members of our senior management receive compensation
from our Company in the form of salaries, discretionary bonuses, contributions to pension
schemes and other allowances and benefits in kind subject to applicable laws, rules and
regulations.
Our Board will review and determine the remuneration and compensation packages of our
Directors, Supervisors and senior management which, following the Listing, will receive
recommendation from the remuneration committee which will take into account salaries paid
by comparable companies, time commitment and responsibilities of our Directors and
performance of our Group.
REMUNERATION OF DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
For the years 2021, 2022 and 2023, the aggregate amount of directors’ fees, salaries,
allowances and benefits in kind, discretionary bonuses, retirement scheme contributions, and
termination benefits of our Directors and Supervisors were RMB3.9 million, RMB5.2 million
and RMB5.7 million, respectively. It is estimated that under the arrangements currently in
force, the aggregate emolument payable to the Directors and Supervisors (excluding
discretionary bonus) for the year ending December 31, 2024, will be RMB5.0 million.
Our Company’s five highest paid individuals includes two, two and two Directors for each
of the years 2021, 2022 and 2023, respectively. The aggregate amount of directors’ fees,
salaries, allowances and benefits in kind, discretionary bonuses, retirement scheme
contributions, and termination benefits of five highest individuals (including Directors) for
each of the years 2021, 2022 and 2023, were RMB5.8 million, RMB7.6 million and RMB8.3
million, respectively. During the Track Record Period, no remuneration was paid by our
Company to, or receivable by, our Directors, Supervisors or the five highest paid individuals
as an inducement to join or upon joining our Company or as a compensation for loss of office
in connection with the management of the affairs of our Company or any subsidiary during the
Track Record Period.
During the Track Record Period, none of our Directors and Supervisors waived or agreed
to waive any emolument.
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For details of Directors’ and Supervisors’ remunerations in each year of the Track Record
Period as well as details of the five highest paid individuals, see notes 8 and 9 in the
Accountants’ Report as set out in Appendix I to this prospectus.
COMPLIANCE ADVISOR
In accordance with Rule 3A.19 of the Listing Rules, our Company has appointed Maxa
Capital Limited as our compliance advisor. Pursuant to Rule 3A.23 of the Listing Rules, our
Company will consult with and 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
required by regulatory authorities or applicable laws;
(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 Listing in a manner
different from that detailed in this prospectus or where the business activities,
developments or results of our Group deviate from any forecast, estimate, or other
information in this prospectus; and
(d) where the Stock Exchange makes an inquiry of the listed issuer under Rule 13.10 of
the Listing Rules.
Pursuant to Rule 3A.24 of the Listing Rules, the Compliance Advisor will, in a timely
manner, inform us of any amendment or supplement to the Listing Rules that are announced
by the Stock Exchange as well as any amendment or supplement to applicable laws and
guidelines.
The Compliance Advisor’s term of appointment shall commence on the Listing Date and
end on the date which we distribute our annual report of financial results for the first full
financial year commencing after the Listing Date, or until the agreement is terminated,
whichever is earlier.
CONFIRMATION FROM OUR DIRECTORS
Rule 8.10 of the Listing Rules
As at the Latest Practicable Date, none of our Directors, or their respective close
associates, was engaged in or had any interest in a business, apart from business of our Group,
which competes or is likely to compete with our business, whether directly or indirectly, or
would otherwise require disclosure under Rule 8.10 of the Listing Rules.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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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 June 2023, and (ii) understands his or her
obligations as a director of a listed issuer under the Listing Rules.
Rule 3.13 of the Listing Rules
Each of the 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) 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 (as defined in the Listing Rules) of our
Company; and (iii) that there are no other factors that may affect his independence at the time
of his appointment.
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You should read the following discussion and analysis in conjunction with our
audited consolidated financial information, included in the Accountants’ Report in
Appendix I to this prospectus, together with the respective accompanying notes. Our
consolidated financial information has been prepared in accordance with IFRS, which
may differ in material aspects from generally accepted accounting principles in other
jurisdictions. You should read the entire Accountants’ Report and not merely rely on the
information contained in this section.
The following discussion and analysis contain forward-looking statements that
reflect our current views with respect to future events and financial performance that
involve risks and uncertainties. These statements are based on assumptions and analysis
made by us in light of our experience and perception of historical events, current
conditions and expected future developments, as well as other factors we believe are
appropriate under the circumstances. However , whether the actual outcome and
developments will meet our expectations and predictions depends on a number of risks
and uncertainties over which we do not have control. For details, see “Forward-looking
Statements” and “Risk Factors” in this prospectus.
OVERVIEW
We are an enterprise-level solution provider in China, dedicated to offering standardized
yet conveniently diversified solutions that could effectively improve the level of convenience
and intelligence with respect to enterprise-level users’ information exchanges and business
interactions. Our solutions are based upon our technologies comprising core conversational AI
technologies, unified communication technologies, as well as other AI and computer
technologies enabling product engine. Leveraging the completeness of our technologies, we are
able to offer a number of typical types of solutions that are commonly needed by various
enterprise-level users in their interactive scenarios. During the Track Record Period, we
primarily offered such solutions to four key end-customer industries where we had
accumulated rich industry know-how, engineering experiences and customer insights, i.e., city
management and administration, automotive and transportation, telecommunications, and
finance. Our solution offerings are enabled by V oicecomm Brain, our robust technology
infrastructure, and V oicecomm Suites, our comprehensive functional modules. V oicecomm
Brain is underpinned by our core technologies in both unified communications and AI. On top
of our robust V oicecomm Brain, we have developed a full set of V oicecomm Suites, the
modular combination of which allows us to offer different types of solutions to address the pain
points experienced by enterprise-level users.
Empowered by our comprehensive enterprise-level solution offerings and superior
delivery capabilities, our revenue increased rapidly during the Track Record Period, from
RMB459.9 million in 2021 to RMB515.0 million in 2022, and further to RMB813.0 million in
2023 at a CAGR of 33.0% from 2021 to 2023. Our revenue growth throughout the Track
Record Period was primarily due to the continuous expansion of both our operational scale and
FINANCIAL INFORMATION
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customer base. Meanwhile, our gross profit increased from RMB152.2 million in 2021 to
RMB201.5 million in 2022, and further to RMB325.4 million in 2023 at a CAGR of 46.2%
from 2021 to 2023, with our gross profit margin improving continuously from 33.1% in 2021
to 39.1% in 2022, and further to 40.0% in 2023. Despite our increasing investments in R&D
and commercialization during the Track Record Period, we are able to maintain profitability
from our operations, with our adjusted net profit (a non-IFRS measure) amounting to
RMB117.7 million in 2023.
BASIS OF PREPARATION
Our historical financial information has been prepared in accordance with all applicable
International Financial Reporting Standards (IFRS), which collectively include all applicable
individual International Financial Reporting Standards, International Accounting Standards,
and Interpretation issued by the International Accounting Standards Board. Our historical
financial information is presented in Renminbi (RMB), rounded to the nearest thousand, unless
otherwise indicated.
The measurement basis used in the preparation of our historical financial information is
the historical cost basis, except that the assets and liabilities are stated at their fair value as
explained in the accounting policies as set out in Note 2 to the Accountants’ Report in
Appendix I to this prospectus.
The preparation of financial statements in conformity with IFRS requires our
management to make judgements, estimates and assumptions that affect the application of
policies and reported amounts of assets, liabilities, income and expenses. The estimates and
associated assumptions are based on historical experience and various other factors that are
believed to be reasonable under the circumstances, the results of which form the basis of
making the judgements about carrying values of assets and liabilities that are not readily
apparent from other sources. Judgements made by our management in the application of IFRS
that have significant effect on the financial statements and major sources of estimation
uncertainty are discussed in Note 3 to the Accountants’ Report in Appendix I to this prospectus.
SIGNIFICANT FACTORS AFFECTING OUR RESULTS OF OPERATIONS
Our results of operation are primarily affected by the growth and penetration of the
enterprise-level conversational AI solution market in China. In addition to the general industry
backdrop and specifically on company level, we see our topline growth mainly driven by our
revenue from offering enterprise-level solutions, which is in turn contingent upon our ability
to grow our customer base and deepen existing customer relationships in our key end-customer
industries, as well as our ability to enhance our technological capabilities and expand into other
industries. Besides, our ability to achieve profitability will be constantly influenced by our cost
structure as well as research and development expenses and selling and marketing expenses,
among other expenses.
FINANCIAL INFORMATION
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Growth and Penetration of the Enterprise-Level Conversational AI Solution Market in
China
We believe that our financial performance and future growth are dependent on the overall
growth of, and our competitiveness in, the enterprise-level conversational AI solution market
in China. According to the iResearch Report, in 2023, the enterprise-level conversational AI
solution market in China reached RMB62.1 billion, and is expected to reach RMB204.1 billion
in 2028, at a CAGR of 26.9% from 2023 to 2028. However, the penetration rate of
enterprise-level conversational AI solutions in China was merely 11.6% in 2023, as compared
to 18.2% for the U.S. according to the same source. Currently, the penetration rate of
enterprise-level conversational AI solutions in China still has huge growth potentials, which is
estimated to increase to 16.2% in 2028. Furthermore, with China’s significant economic scale
and considerable social activity level that give rise to a rich variety of application scenarios
being increasingly penetrated and expanded by enterprise-level conversational AI, we expect
the market demand for our solutions to increase continuously, which will further drive our sales
in the foreseeable future.
Our Ability to Grow Our Customer Base and Deepen Existing Customer Relationships in
Our Key End-Customer Industries
During the Track Record Period, our various types of enterprise-level solutions had been
deployed in our key end-customer industries including city management and administration,
automotive and transportation, telecommunications, and finance. Our growth depends thus
significantly on our ability to attract new customers and retain and expand relationship with
existing ones in such key end-customer industries, which is in turn dependent upon our
effective go-to-market strategies.
Specifically, our go-to-market strategies start at collaborations with early adopters, such
as our launch customers, in certain end-customer industry we target to enter, which allows us
to accumulate industry expertise and demonstrate the value of our solutions through one or a
few entry projects. Once our value has been proven, we are then able to expand our presence
quickly to cover other quality customers and further penetrate the end-customer industry.
Fostered accordingly by our understanding of the existing users and our rich industry
know-how, we are able to rapidly iterate our solution offerings, so as to up-sell our existing
customers and increase their stickiness to our solutions, and ultimately increase our market
share. We have gained loyalty of our existing customers and are dedicated to creating value for
them with our standardized solutions. Going forward, we expect to achieve sustainable growth
in the foreseeable future as we continue to attract more customers and deepen relationships
with our existing customers in our key end-customer industries.
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Our Ability to Enhance Our Conversational AI Technological Capabilities and Expand
into Other Industries
Our conversational AI technological capabilities are crucial to our business operations.
Aiming at satisfactorily serving enterprise-level users’ actual business needs, we will continue
to invest in research and development so as to advance the standardization of our solutions, as
well as to iteratively develop more application scenarios and innovative functions for the same.
Specifically, we will continue to enhance our technological capabilities by implementing our
key technology initiatives such as reinforcement learning, transfer learning and federated
learning, visualizable conversational AI empowered by computer vision AI and next-generation
unified communications compatible with visualizable conversational AI, so as to strengthen
our competitiveness over existing and emerging enterprise-level conversational AI solution
providers, and maintain our competitiveness and innovativeness of our conversational AI
technologies. During the Track Record Period, our research and development expenses
amounted to RMB36.3 million, RMB64.0 million and RMB98.8 million in 2021, 2022 and
2023, respectively. We expect our strategic focus on innovations will further reinforce our
competitive edge and enable us to capture additional market shares, which in turn will enable
us to further increase our revenue and strengthen our financial performance.
Additionally, our further growth will also depend upon our ability to expand into other
industries. By leveraging our go-to-market strategies and accumulated industry insights proven
to be successful in serving our four key end-customer industries, we plan to accelerate our
penetration into other industries such as the media, healthcare, E-commerce and retailing, etc.,
in order to empower their intelligent transformation and improve our industry coverage. We
aim to acquire and retain new customers by, among others, further enhancing the quality and
efficiency of our existing solutions, offering additional innovative solutions and implementing
effective sales strategies, in a way that is appropriate for such industries in which we intend
to serve.
Our Ability to Continuously Maintain and Enhance Our Margin Levels and Operating
Efficiency
Our ability to continuously maintain and enhance our margin levels and operating
efficiency depends significantly on our ability to manage and optimize our costs and operating
expenses. During the Track Record Period, our gross profit margin improved continuously
from 33.1% in 2021 to 39.1% in 2022, and further to 40.0% in 2023, thanks to the high
standardization and modularization of our enterprise-level solutions that allow us to address
user demand effectively and efficiently. While our cost structure will be affected by the mix of
our solution offerings and might further impact our gross profit margin, we believe that we are
well positioned to scale up our revenues while achieving significant cost efficiency. As our
business grows in scale, we expect to further realize structural cost savings to compete more
efficiently.
FINANCIAL INFORMATION
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Besides, controlling operating expenses to achieve optimal operating efficiency is also
important to our success. In 2021, 2022 and 2023, our research and development expenses as
a percentage of our revenue was 7.9%, 12.4% and 12.2%, respectively, and our selling and
marketing expenses as a percentage of our revenue was 0.7%, 1.4% and 1.3%, respectively.
Benefitting from our effective go-to-market strategies, we have demonstrated promising
prospects for stable profitability. To ensure effective implementation of our technology
strategies, we will expand our research and development team on a continuous basis and recruit
more industry-leading talents. Moreover, with a goal to strengthen our commercialization
capabilities effectively, we plan to expand our in-house sales and marketing team by recruiting
more professionals with rich industry and customer insights. As such, we expect the absolute
amounts of our research and development expenses and selling and marking expenses will
continue to increase along our business growth in the future. Nevertheless, as we expand the
scale and scope of our business and solution offerings, we expect to benefit from various
economies of scale to improve our operational efficiency.
IMPACT OF THE COVID-19 PANDEMIC
Since late 2019, the outbreak of a novel strain of coronavirus named COVID-19 has
materially and adversely affected the global economy. The pandemic caused temporary
challenges to our financial performance and business operations during the Track Record
Period. COVID-19, among other various factors, contributed to our prolonged trade receivables
turnover days during the Track Record Period, by hampering the timely on-site acceptance and
prolonging the payment cycle with respect to the projects in which we were involved. For
details, see “– Discussion of Selected Items from Consolidated Statements of Financial
Position – Trade and Other Receivables – Trade Receivables” in this section. In addition, with
respect to our business operations, we took a series of measures in response to the pandemic
to protect our employees, including the temporary closure of our offices, remote working
arrangements, and travel restrictions or suspension, which had temporarily reduced our
operational capacity and efficiency. As of the Latest Practicable Date, we did not experience
any material adverse impact of COVID-19 on our financial performance or business
operations. We will continue to pay close attention to the development of the COVID-19
pandemic and dedicate resources to take actions to minimize any adverse impact therefrom.
MATERIAL ACCOUNTING POLICY INFORMATION AND MATERIAL
ACCOUNTING JUDGMENT
We have identified certain accounting policies that are material to the preparation of our
consolidated financial statements. Some of our accounting policies involve subjective
assumptions and estimates, as well as complex judgments relating to accounting items. The
estimates and assumptions we use and the judgments we make in applying our accounting
policies have a material impact on our financial position and operational results. Our
management continuously evaluates such estimates, assumptions and judgments based on past
experience and other factors, including industry practices and expectations of future events
which are deemed to be reasonable under the circumstances. There had not been any material
FINANCIAL INFORMATION
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deviation from our management’s estimates or assumptions and actual results, and we had not
made any material changes to these estimates or assumptions during the Track Record Period.
We do not expect any material changes to these estimates and assumptions in the foreseeable
future.
We set out below some of the accounting policies and estimates that we believe are of
critical importance to us or involve the most material estimates and judgments used in the
preparation of our financial statements. Our material accounting policy information and
material accounting judgment, which are important for understanding our financial condition
and results of operations, are set out in further details in Note 2 and Note 3 to the Accountants’
Report in Appendix I to this prospectus.
Revenue Recognition
Revenue arises from the sale of goods and the provision of services in the ordinary course
of our business.
Revenue is recognized when control over a product or service is transferred to the
customer. For each performance obligation satisfied over time, we recognize revenue over time
by measuring the progress toward complete satisfaction of that performance obligation. If we
do not satisfy a performance obligation over time, the performance obligation is satisfied at a
point in time, at the amount of promised consideration to which we are expected to be entitled,
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.
Revenue is allocated to each performance obligation based on its standalone selling price.
We generally determine standalone selling prices based on observable prices. If the standalone
selling price is not observable through past transactions, we estimate the standalone selling
price based on multiple factors, including, but not limited to management approved price list
or cost-plus margin analysis.
Where the contract contains a financing component which provides a significant
financing benefit to the customer for more than 12 months, revenue is measured at the present
value of the amount receivable, discounted using the discount rate that would be reflected in
a separate financing transaction with the customer, and interest income is accrued separately
under the effective interest method. 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. We
take advantage of the practical expedient in paragraph 63 of IFRS 15 and do not adjust the
consideration for any effects of a significant financing component if the period of financing is
12 months or less.
FINANCIAL INFORMATION
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We generate substantially all of the revenues from the following services and products:
 Enterprise-level solutions;
 Other services primarily include promotion service.
Our enterprise-level solutions are offered either on software platform or solutions come
with functionalities and interfacing capabilities tailored to customers’ operation environment
integrated with communication devices or other hardware and other service and software
license. We determine that such contracts typically comprise one single performance
obligation. Revenues are recognized at a point in time upon customer’s acceptance of the
respective solutions or products, which is when the control over our goods or services is
transferred to customers.
The maintenance services are provided to customers for a fixed amount over the service
period, usually within one year. We recognize revenues from maintenance services over the
period when the services were provided, since customers simultaneously receive and consume
the benefit of the services. We use straight-line method to recognize revenue ratably over the
service period. The other services provided to customers are recognized based on usage over
the period.
We recognize enterprise-level solutions revenue on a gross basis because we are the
principal and control the hardware to be provided to the customer before the hardware is
transferred to that customer. In addition, we are primarily responsible for fulfilling the promise
to provide the hardware and have discretion in establishing the price for the hardware.
Goodwill
Goodwill arising on acquisition of business is measured at cost less accumulated
impairment losses and is tested annually for impairment. For details, see Note 2(e) and 2(j)(ii)
to the Accountants’ Report in Appendix I to this prospectus.
Property and Equipment
The following items of property and equipment are stated at cost, which includes
capitalized borrowing costs, less accumulated depreciation and any accumulated impairment
losses:
 right-of-use assets arising from leasehold properties where we are not the registered
owner of the property interest; and
 items of plant and equipment, including right-of-use assets arising from leases of
underlying plant and equipment.
FINANCIAL INFORMATION
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If significant parts of an item of property, plant and equipment have different useful lives,
then they are accounted for as separate items (major components).
For details, see Notes 2(i) and 2(j) to the Accountants’ Report in Appendix I to this
prospectus.
Any gain or loss on disposal of an item of property and equipment is recognized in profit
or loss.
Depreciation is calculated to write off the cost of items of property and equipment, less
their estimated residual value, if any, using the straight line method over their estimated useful
lives, and is generally recognized in profit or loss.
The estimated useful lives for the current and comparative periods are as follows:
Electronic equipment Three years
Furniture Five years
Servers Five years
Vehicles Four years
Leasehold improvements Shorter of estimated useful life and remaining lease terms
Right-of-use assets Over the lease term
Depreciation methods, useful lives and residual values are reviewed at each reporting date
and adjusted if appropriate.
Construction in progress represents properties under construction and machinery and
equipment pending installation and is stated at cost less impairment losses. For details, see
Note 2(j)(ii) to the Accountants’ Report in Appendix I to this prospectus. Cost comprises the
purchase costs of the asset and the related construction and installation costs.
Construction in progress is transferred to property and equipment when the asset is
substantially ready for its intended use and depreciation will be provided at the appropriate
rates in accordance with the depreciation policies specified above.
No depreciation is provided in respect of construction in progress.
Intangible assets (other than goodwill)
Intangible assets (other than goodwill) that are acquired by us and have finite useful lives
are measured at cost less accumulated amortization and any accumulated impairment losses.
For details, see Note 2(j)(ii) to the Accountants’ Report in Appendix I to this prospectus.
Amortization is calculated to write off the cost of intangible assets less their estimated
residual values using the straight-line method over their estimated useful lives, if any, and is
generally recognized in profit or loss.
FINANCIAL INFORMATION
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The estimated useful lives for the current and comparative periods are as follow:
Software Five years
Patents Eight years
Amortization methods, useful lives and residual values are reviewed at each reporting
date and adjusted if appropriate.
Credit Losses and Impairment of Assets
We recognize a loss allowance for expected credit losses (ECLs) on financial assets
measured at amortized cost (including cash, trade receivables and other receivables, which are
held for the collection of contractual cash flows which represent solely payments of principal
and interest).
Measurement of ECLs
ECLs are a probability-weighted estimate of credit losses. Generally, credit losses are
measured as the present value of all expected cash shortfalls between contractual and expected
amounts.
The expected cash shortfalls are discounted using the following rates if the effect is
material:
 fixed-rate financial assets and trade and other receivables: effective interest rate
determined at initial recognition or an approximation thereof;
 variable-rate financial assets: current effective interest rate.
The maximum period considered when estimating ECLs is the maximum contractual
period over which we are exposed to credit risk.
ECLs are measured on either of the following bases:
 12-month ECLs: these are the portion of ECLs that result from default events that
are possible within the 12 months after the reporting date (or a shorter period if the
expected life of the instrument is less than 12 months); and
 lifetime ECLs: these are the ECLs that result from all possible default events over
the expected lives of the items to which the ECL model applies.
Loss allowances for trade receivables are always measured at an amount equal to lifetime
ECLs.
FINANCIAL INFORMATION
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Significant Increases in Credit Risk
When determining whether the credit risk of a financial instrument has increased
significantly since initial recognition and when measuring ECLs, we consider reasonable and
supportable information that is relevant and available without undue cost or effort. This
includes both quantitative and qualitative information and analysis, based on our historical
experience and informed credit assessment, that includes forward-looking information.
We assume that the credit risk on a financial asset has increased significantly if it is more
than 30 days past due dates.
We consider a financial asset to be in default when:
 the debtor is unlikely to pay its credit obligations to us in full, without recourse by
us to actions such as realising security (if any is held); or
 the financial asset is 90 days past due.
ECLs are remeasured at each reporting date to reflect changes in the financial
instrument’s credit risk since initial recognition. Any change in the ECL amount is recognized
as an impairment gain or loss in profit or loss. We recognize an impairment gain or loss for all
financial instruments with a corresponding adjustment to their carrying amount through a loss
allowance account, except for investments in non-equity securities that are measured at FVOCI
(recycling), for which the loss allowance is recognized in OCI and accumulated in the fair
value reserve (recycling) does not reduce the carrying amount of the financial asset in the
statement of financial position.
Interest Income
Interest income is recognized using the effective interest method. The “effective interest
rate” is the rate that exactly discounts estimated future cash receipts through the expected life
of the financial asset to the gross carrying amount of the financial asset. In calculating interest
income, the effective interest rate is applied to the gross carrying amount of the asset (when
the asset is not credit-impaired). However, for financial assets that have become credit-
impaired, subsequent to initial recognition, interest income is calculated by applying the
effective interest rate to the amortized cost of the financial asset. If the asset is no longer
credit-impaired, then the calculation of interest income reverts to the gross basis.
FINANCIAL INFORMATION
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Write-Off Policy
The gross carrying amount of a financial asset is written off to the extent that there is no
realistic prospect of recovery. This is generally the case when we otherwise determine that the
debtor does not have assets or sources of income that could generate sufficient cash flows to
repay the amounts subject to the write-off.
Subsequent recoveries of an asset that was previously written off are recognized as a
reversal of impairment in profit or loss in the period in which the recovery occurs.
Contract Liabilities
A contract liability is recognized when the customer pays non-refundable consideration
before we recognize the related revenue. A contract liability is also recognized if we have an
unconditional right to receive non-refundable consideration before we recognize the related
revenue. In such latter cases, a corresponding receivable is also recognized.
For details, see Note 2(v) to the Accountants’ Report in Appendix I to this prospectus.
Research and Development Expenses
Research and development expenses comprise all expenditures that are directly
attributable to research and development activities or that can be allocated on a reasonable
basis to such activities. Such research and development expenditures are recognized as
expenses in the period in which they are incurred.
Interest-Bearing Borrowings
Interest-bearing borrowings are measured initially at fair value less transaction costs.
Subsequent, these borrowings are stated at amortized cost using the effective interest method.
For details, see Note 2(z) to the Accountants’ Report in Appendix I to this prospectus.
Fair Value Measurement of Financial Instruments Using Valuation Techniques
The fair value of financial instruments that are not traded in an active market is
determined using valuation techniques. The valuation techniques include discounted cash flow
model, market comparable model, adjusted recent transaction price and so on. We use our
judgement to select a variety of methods and make assumptions that are mainly based on
market conditions existing at the end of each reporting period. For details of the key
assumptions used and the impact of changes to these assumptions, see Note 30(e) to the
Accountants’ Report in Appendix I to this prospectus. The use of different valuation techniques
or inputs may result in significant differences in fair value estimate. The fair value generated
by valuation technique is also verified with transactions of same or similar financial
instruments in observable markets according to market practice.
FINANCIAL INFORMATION
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Impairment of Non-Financial Assets (Other Than Goodwill)
We assess whether there are any indicators of impairment for all non-financial assets
(including the right-of-use assets) at the end of each of the relevant reporting periods.
Non-financial assets are tested for impairment when there are indicators that the carrying
amounts may not be recoverable. An impairment exists when the carrying value of an asset or
a cash-generating unit exceeds its recoverable amount, which is the higher of its fair value less
costs of disposal and its value in use. The calculation of the fair value less costs of disposal
is based on available data from binding sales transactions in an arm’s length transaction of
similar assets or observable market prices less incremental costs for disposing of the asset.
When value in use calculations are undertaken, our management must estimate the expected
future cash flows from the asset or cash-generating unit and choose a suitable discount rate in
order to calculate the present value of those cash flows.
Impairment of Goodwill
We determine whether goodwill is impaired at least on an annual basis. This requires an
estimation of the value in use of the cash-generating units to which the goodwill is allocated.
Estimating the value in use requires us to make an estimate of the expected future cash flows
from the cash-generating units and also to choose a suitable discount rate in order to calculate
the present value of those cash flows. For further details, see Note 15 to the Accountants’
Report in Appendix I to this prospectus.
Deferred Tax Assets
Deferred tax assets are recognized for unused tax losses to the extent that it is probable
that taxable profit will be available against which the losses can be utilized. Significant
management judgement is required to determine the amount of deferred tax assets that can be
recognized, based upon the likely timing and level of future taxable profits together with future
tax planning strategies.
Loss Allowance for ECLs
We estimate the amount of loss allowance for ECLs on trade and other receivables that
are measured at amortized cost based on the credit risk of the respective financial instruments.
The loss allowance amount is measured as the asset’s carrying amount and the present value
of estimated future cash flows with the consideration of expected future credit loss of the
respective financial instrument. The assessment of the credit risk of the respective financial
instrument involves high degree of estimation and uncertainty. When the actual future cash
flows are less than expected or more than expected, a material impairment loss or a material
reversal of impairment loss may arise, accordingly.
FINANCIAL INFORMATION
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DESCRIPTION OF SELECTED COMPONENTS OF CONSOLIDATED STATEMENTS
OF PROFIT OR LOSS
The following table sets forth our consolidated statements of profit or loss for the years
indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Revenue 459,935 514,992 813,017
Cost of revenue (307,773) (313,526) (487,600)
Gross Profit 152,162 201,466 325,417
Other revenue 7,692 11,016 27,226
Other net gain/(loss) 200 (16) (25)
Research and development expenses (36,310) (63,983) (98,798)
Selling and marketing expenses (3,162) (7,249) (10,347)
Administrative and other operating
expenses (24,552) (31,486) (58,499)
Impairment loss on trade receivables (17,444) (42,562) (55,379)
Profit from operations 78,586 67,186 129,595
Net finance costs (8,183) (9,034) (11,696)
Changes in carrying amount of
redeemable capital contributions (25,950) (157,504) (146,892)
Changes in fair value of financial assets
measured at fair value through profit
or loss – 8,337 258
Share of (loss)/gain of associates (22) 131 (20)
Profit/(loss) before taxation 44,431 (90,884) (28,755)
Income tax (8,047) 5,073 (446)
Profit/(loss) for the year 36,384 (85,811) (29,201)
Attributable to
Equity shareholder of our Company 36,895 (87,155) (33,754)
Non-controlling interests (511) 1,344 4,553
Earnings/(loss) per share
Basic and diluted (RMB) 1.61 (3.33) (1.13)
Other comprehensive income for
the year (84) 37 180
Total comprehensive income for
the year 36,300 (85,774) (29,021)
FINANCIAL INFORMATION
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Non-IFRS Measure
To supplement our consolidated financial statements which are presented in accordance
with IFRS, we also use the adjusted net profit (a non-IFRS measure) as an additional financial
measure, which is not required by, or presented in accordance with, IFRS. We believe that such
non-IFRS measure facilitates comparisons of operating performance from period to period and
company to company by eliminating potential impacts of certain items. We believe that such
measure provides useful information to investors and others in understanding and evaluating
our consolidated results of operations in the same manner as it helps our management.
However, our presentation of the adjusted net profit (a non-IFRS measure) may not be
comparable to similarly titled measures presented by other companies. The use of such
non-IFRS measure has limitations as an analytical tool, and you should not consider it in
isolation from, or as substitute for analysis of, our results of operations or financial condition
as reported under IFRS.
We define the adjusted net profit (a non-IFRS measure) as profit for the year by
eliminating the impacts of changes in carrying amount of redeemable capital contributions. The
following table reconciles our adjusted net profit (a non-IFRS measure) presented to the
financial measure calculated and presented in accordance with IFRS, namely profit/loss for the
year:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Reconciliation of profit/loss for the year
and adjusted net profit (a non-IFRS
measure)
Profit/(loss) for the year 36,384 (85,811) (29,201)
Add:
Changes in carrying amount of redeemable
capital contributions 25,950 157,504 146,892
Adjusted net profit (a non-IFRS measure) 62,334 71,693 117,691
Our management considers that changes in carrying amount of redeemable capital
contributions is a non-cash item, primarily due to which we incurred net loss for the year of
2022 and 2023 and such carrying amount will be reclassified from financial liabilities to equity
upon completion of the Listing and the Global Offering. Therefore, by eliminating the impacts
of the said item in the calculation of the adjusted net profit (a non-IFRS measure), such
measure could better reflect our underlying operating performance and could better facilitate
the comparison of operating performance from year to year.
FINANCIAL INFORMATION
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Revenue
During the Track Record Period, we generated our revenue on a project basis mainly from
offering enterprise-level solutions enabled primarily by our technologies on unified
communications and AI to our customers. Depending upon specific users’ concrete needs, the
extent to which a certain solution involves each category of technologies may vary. The
following table sets forth a breakdown of our total revenue by offering categories:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Enterprise-level solutions 456,871 99.3 491,641 95.5 801,060 98.5
Others* 3,064 0.7 23,351 4.5 11,957 1.5
Total 459,935 100.0 514,992 100.0 813,017 100.0
Note:
* Primarily related to promoting products empowered by our conversational AI technologies for our
customers, from which we generated revenue
Specifically, our customers for our solutions during the Track Record Period included: (i)
system integrators that embedded our solutions into their offerings to enterprise-level users;
and (ii) enterprise-level users that used our solutions directly. The following table sets forth a
breakdown of our revenue generated from offering solutions by customer types, in absolute
amounts and as a percentage of total solution revenue, for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Revenue from
– System integrators 381,101 83.4 378,897 77.1 638,528 79.7
– Enterprise-Level users 75,770 16.6 112,744 22.9 162,532 20.3
Total 456,871 100.0 491,641 100.0 801,060 100.0
FINANCIAL INFORMATION
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The solutions that we offered during the Track Record Period consisted of: (i) software
only solutions; and (ii) software plus hardware solutions in which we integrated our software
systems with hardware devices, network and other telecommunication resources, and/or other
services (if needed), etc., procured from suppliers as part of our total solutions. The software
plus hardware solutions are usually required in order to avoid issues during the operation and
maintenance of the systems, such as difficulty in faults identification, or when a single
module’s upgrade affects the operation of other modules, etc. Customers can determine the
specifications of the solutions to be purchased from us and the delivery method based on their
needs. The following table sets forth a breakdown of our revenue generated from offering
solutions by solutions types, in absolute amounts and as a percentage of total solution revenue,
for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Software only solutions 85,447 18.7 162,548 33.1 282,980 35.3
Software plus hardware
solutions 371,424 81.3 329,093 66.9 518,080 64.7
Total 456,871 100.0 491,641 100.0 801,060 100.0
During the Track Record Period, we generated an increasing amount of revenue from our
software only solutions, which also took up an increasing portion in our total revenue, mainly
due to that (i) it is our increasingly heightened focus to scale up offering such solutions of
higher margins in order to enhance our competitive positioning while expanding profit pools
through the maturation and accumulation of our technologies. As we establish and enhance our
market presence, we have gradually adopted the strategy that prioritizes offering software only
solutions in projects in which customers do not specifically demand software plus hardware
delivery or where there is no concrete scenario-specific benefit for doing so, provided that this
priority would not affect our acquisition of such customers; and (ii) the continuous expansion
of our customer bases who typically purchased from us software plus hardware solutions to
firstly establish their communication platforms affords us the opportunities to up-sell software
only solutions later to further diversify and enhance their unified communications and AI
capabilities.
As certain customers may have specific demand on functionalities that are incidental to
our technologies, we from time to time externally purchased software and/or services on
developing project-specific software to enable offering total solutions on a one-stop basis
during the Track Record Period. Since we focus our business on delivering values to
enterprise-level users primarily based upon our technologies, such externally purchased
software and/or software-development services took up a limited percentage of our cost of
revenue in each year of the Track Record Period. For details, see “– Cost of Revenue” in this
FINANCIAL INFORMATION
–4 1 1–


--- page 421 ---
section. The following table sets forth a breakdown of our revenue generated from software
only solutions enabled solely by our technologies and those that incorporated externally
purchased software and/or software-development services for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Software only solutions
– Enabled solely by our
technologies 72,385 84.7 154,456 95.0 219,777 77.7
– Including externally
purchased software
and/or software-
development services 13,062 15.3 8,092 5.0 63,203 22.3
Total 85,447 100.0 162,548 100.0 282,980 100.0
Our revenue generated from software only solutions that incorporated externally
purchased software and/or software-development services fluctuated in each year of the Track
Record Period, reflecting the contingent nature of the accessory functionalities demanded the
relevant customers in each year. By contrast, our revenue generated from software only
solutions enabled solely by our technologies increased continuously during the Track Record
Period, which was consistent with the general trend of our revenue growth and also took up the
major portion of our revenue generated from software only solutions. Our revenue generated
from software only solutions enabled solely by our technologies contributed to a less
percentage of our revenue generated from software only solutions in 2023, primarily due to the
fact that we participated in certain projects that involved the purchase of functionally specific
platforms supplementary to our technologies and accordingly generated a greater amount of
revenue during the same period. Specifically, we primarily purchased externally for certain
platforms for data analytic and management, and vehicle inspection to offer the relevant IoV
solutions, as well as that for human resource maintenance to offer the relevant intelligent
administration solutions, in each case on a one-stop basis.
During the Track Record Period, we generated our revenue primarily from providing our
solutions in a number of end-customer industries, mainly including city management and
administration, automotive and transportation, telecommunications, and finance:
 City Management and Administration. Our solutions have primarily been applied
in intelligent community (comprehensive governmental projects involving diverse
application scenarios), intelligent administration and intelligent IoT, where our
technologies contribute to the establishment of smart cities where city
infrastructure, public spaces and objects are interactively connected, and also make
city management and administrative services more convenient and intelligent.
FINANCIAL INFORMATION
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--- page 422 ---
 Automotive and Transportation. Our solutions have primarily been applied in
customer service for automobile and logistics companies, IoV service that enables
a smart cockpit and facilitates the intelligent scheduling of vehicle resources and
route navigation, as well as V2X autonomous driving, which helps realize a safe,
convenient, intelligent and integrated automobile management and travel
experience.
 Telecommunications. Our solutions can empower telecommunications companies’
communication tools and other value-added services, such as cloud-based phone and
intelligent work badge. Such solutions allow various communication and
management needs of the enterprises that have procured such communication tools
and value-added services to be intelligently satisfied, while substantially lowering
deployment and maintenance costs.
 Finance. Our solutions offered to financial institutions have been applied primarily
in telephone banking, thereby upgrading their customer services and promoting the
comprehensive intelligent transformation of the finance industry. Additionally, we
also offer solutions in service training that facilitate their internal processes.
In addition to offering solutions to the aforementioned four key end-customer industries,
we are also expanding application of our conversational AI technologies to other industries.
For details of our solution offerings, see “Business – Our Solution Offerings – V oicecomm
Solutions” in this prospectus. The following table sets forth a breakdown of our revenue
generated from offering solutions by end-customer industries, in absolute amounts and as a
percentage of total solution revenue, for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
City management and
administration 165,075 36.1 192,734 39.2 321,239 40.1
Automotive and
transportation 81,251 17.8 83,393 17.0 191,077 23.9
Telecommunications 68,385 15.0 91,782 18.7 173,976 21.7
Finance 96,051 21.0 79,745 16.2 84,530 10.5
Other industries 46,109 10.1 43,987 8.9 30,238 3.8
Total 456,871 100.0 491,641 100.0 801,060 100.0
FINANCIAL INFORMATION
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--- page 423 ---
In each year of the Track Record Period, we generated substantially all of our revenue
from customers in the PRC, except for RMB6.0 million from customers in overseas countries
in 2023. The geographical location of a certain customer is determined by the location at which
the relevant solutions at question were accepted.
Cost of Revenue
During the Track Record Period, our cost of revenue primarily consisted of (i) equipment
costs in relation to hardware devices such as communication devices, servers and computers
that were integrated into our solutions; (ii) network and other telecommunication resource
costs, which primarily represented the network resources we procured for our city management
and administration projects; (iii) employee benefit expenses; (iv) depreciation and
amortization; (v) costs mainly in relation to providing promotion services for the sales of
telecommunications terminals and other telecommunications resources and services; (vi)
externally outsourced services primarily on developing project-specific software tailoring to
certain customers’ specific demand on functionalities that are incidental to our technologies in
order to enable offering total solutions; and (vii) other costs.
Specifically, our promotion service costs increased from RMB14.0 million in 2021 to
RMB31.1 million in 2022, primarily due to our increased procurement costs in relation to
providing such promotion services, with the revenue generated therefrom increasing
substantially during the same periods. Such promotion service costs decreased from RMB31.1
million in 2022 to RMB11.7 million in 2023, which was in line with the decrease of our
revenue generated therefrom. For details, see “– Period to Period Comparison of Results of
Operations – 2023 Compared to 2022” in this section. Our costs of externally purchased
services fluctuated in each year of the Track Record Period, reflecting the contingent nature of
the accessory software functionalities demanded the relevant customers in each year. Such
costs increased from RMB6.2 million in 2022 to RMB53.8 million in 2023, primarily due to
our increased procurement costs in relation to externally outsourced software-development
services for providing IoV and intelligent administration solutions. The following table sets
forth a breakdown of our cost of revenue by nature, in absolute amounts and as a percentage
of total cost of revenue for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Equipment costs 180,719 58.7 162,735 51.9 300,593 61.7
Network and other
telecommunication resource
costs 100,351 32.6 100,486 32.1 100,390 20.6
Employee benefit expenses 4,941 1.6 9,177 2.9 10,908 2.2
FINANCIAL INFORMATION
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--- page 424 ---
Y ear Ended December 31,
2021 2022 2023
RMB’000 % RMB’000 % RMB’000 %
Depreciation and amortization 770 0.3 2,728 0.9 4,367 0.9
Promotion service costs 14,030 4.6 31,060 9.9 11,670 2.4
Costs of outsourced services 6,433 2.1 6,150 2.0 53,775 11.0
Others 529 0.1 1,190 0.3 5,897 1.2
Total 307,773 100.0 313,526 100.0 487,600 100
Gross Profit and Gross Profit Margin
Our gross profit represents our revenue less our cost of revenue, and our gross profit
margin represents our gross profit as a percentage of our revenue. Our gross profit amounted
to RMB152.2 million, RMB201.5 million and RMB325.4 million in 2021, 2022 and 2023,
respectively, while our gross profit margin reached 33.1%, 39.1% and 40.0% during the same
years, respectively.
The following table sets forth a breakdown of our gross profit generated from offering
solutions by customer types, in absolute amounts and in terms of gross profit margin for the
years indicated:
Y ear Ended December 31,
2021 2022 2023
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
RMB’000 % RMB’000 % RMB’000 %
Gross profit from
– System
integrators 125,656 33.0 154,110 40.7 230,872 36.2
– Enterprise-
Level users 37,472 49.5 55,065 48.8 94,258 58.0
163,128 35.7 209,175 42.5 325,130 40.6
FINANCIAL INFORMATION
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--- page 425 ---
The following table sets forth a breakdown of our gross profit generated from offering
solutions by solution types, in absolute amounts and in terms of gross profit margin for the
years indicated:
Y ear Ended December 31,
2021 2022 2023
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
RMB’000 % RMB’000 % RMB’000 %
Software only
solutions 76,467 89.5 149,468 92.0 229,996 81.3
Software and
hardware
solutions 86,661 23.3 59,707 18.1 95,134 18.4
163,128 35.7 209,175 42.5 325,130 40.6
Overall, gross profit margins for our software only solutions are higher than that for our
software plus hardware solutions, primarily due to the fact that our software only solutions are
primarily enabled by our technologies that are accounted for mainly as employee benefit
expenses under the intrinsic cost structures. Decades of technological accumulations have thus
allowed sustainably high gross profit levels as the usage of our software increments. By
contrast, our software plus hardware solutions bundle software with outsourced hardware
elements that can substantially normalize gross profit levels. During the Track Record Period,
the gross profit margins of our software only solutions were relatively stable, which amounted
to 89.5%, 92.0% and 81.3% in 2021, 2022 and 2023, respectively. In 2021, 2022 and 2023, the
gross profit margins of our software plus hardware solutions fluctuated between 18.1% and
23.3%, which were essentially a result of the varied software-hardware composition ratios of
different groups of software plus hardware solutions from which we generated revenue in each
year. By the same token, the gross profit margins of our solutions offered to system integrators
and enterprise-level users respectively also fluctuated in each year of the Track Record Period,
which were inherently not comparable therebetween or in a year-to-year fashion, and might not
be indicative of our overall gross profit margin level.
FINANCIAL INFORMATION
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--- page 426 ---
The following table sets forth a breakdown of our gross profit generated from software
only solutions as between those enabled solely by our technologies and those that incorporated
externally purchased software and/or software-development services, in absolute amounts and
in terms of gross profit margin for the years indicated:
Y ear Ended December 31,
2021 2022 2023
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
Gross
profit
Gross
profit
margin
RMB’000 % RMB’000 % RMB’000 %
Gross profit from
software only
solutions
– Enabled solely by
our technologies 69,404 95.9 147,443 95.5 209,402 95.3
– Including externally
purchased software
and/or software-
development
services 7,063 54.1 2,025 25.0 20,594 32.6
76,467 89.5 149,468 92.0 229,996 81.3
As can be seen, the gross profit margins of software only solutions that incorporated
externally purchased software and/or software-development services fluctuated in each year of
the Track Record Period, which was essentially a result of the concrete compositions between
such software and/or services and our software under the relevant solutions that we offered in
each year, and would accordingly affect the specific cost structure for each solution. By
contrast, the gross profit margins of our software only solutions enabled solely by our
technologies remained stable in each year of the Track Record Period.
Other Revenue
During the Track Record Period, our other revenue represented government grants
received as rewards of our contribution to technological innovations and regional economic
development, and encouragement of project development, which were recognized in the
consolidated statements of profit or loss when related conditions, if any were, satisfied. In
2021, 2022 and 2023, such government grants amounted to RMB7.7 million, RMB11.0 million
and RMB27.2 million, respectively.
FINANCIAL INFORMATION
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--- page 427 ---
Research and Development Expenses
During the Track Record Period, our research and development expenses primarily
consisted of (i) technology service fees, which primarily represented outsourcing costs for
certain non-core and less sophisticated research and development programs; (ii) employee
benefit expenses, which primarily represented wages and benefits of our research and
development staff; (iii) depreciation and amortization; and (iv) others. The following table sets
forth a breakdown of our research and development expenses for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Technology service fees 20,077 29,083 46,391
Employee benefit expenses 13,471 23,948 34,843
Depreciation and amortization 1,278 8,935 15,571
Others 1,484 2,017 1,993
Total 36,310 63,983 98,798
During the Track Record Period, we engaged third-party technology service providers
mainly for (i) the non-standardized steps in the development of our solutions, such as data
training, AI algorithm optimization and specific user application development, so that we could
more efficiently focus on our standardized functional modules to offer our solutions; and (ii)
certain non-core technological programs supplemental to our core conversational AI
technologies in areas that we have newly tapped into at the time, such as that related to ICV
projects and intelligent video analysis, so as to quickly penetrate into such areas and offer
innovative solutions in a cost-efficient manner. During the Track Record Period, such fees
accounted for a major portion of our research and development expenses in relation to other
expenditures thereunder (e.g., employee benefit expenses), mainly reflecting the fact that we
have accomplished a level of economies of scale in our technologies based upon our rich
technological and know-how precipitation accumulated for nearly two decades. While our
technology service fees increased during the Track Record Period, which was consistent with
our expanded business operations and enhanced research and development activities to be
carried out, our research and development expenses as a percentage of our revenue was 7.9%,
12.4% and 12.2%, respectively.
FINANCIAL INFORMATION
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--- page 428 ---
The following tables set forth the details of our major third-party technology service
providers in each year of the Track Record Period:
Major Technology
Service Providers
for 2021 Background
Research and
Development
Expenses
Attributable
to the Provider
Details of the Technology
Services Procured
RMB’000
Supplier K An Anhui-based
company focusing on
technology
development,
consulting, transfer
and other services in
the field of cloud
computing,
information and
network technology
10,377 Technological development
services relating to
intelligent video analysis
platform enabled by
technologies on visualization
engine, geographic
information system (GIS)
visualization, edge
computing and cloud-edge
coordination, etc., which
facilitated our video analysis
and management related
technological steps
Supplier F For details, see
“Business – Suppliers
and Procurement –
Top Suppliers” in this
prospectus
4,586 Technological development
services relating to big data
governance, comprising data
integration, quality control
and management, etc.,
according to industrial
standards, which optimized
our AI algorithm training
processes; and IoT
management platform used
for remote control of display
screens, which enabled
unified control of image and
video-based content output
and management, and
facilitated our terminal-end
display related technological
steps
FINANCIAL INFORMATION
– 419 –


--- page 429 ---
Major Technology
Service Providers
for 2021 Background
Research and
Development
Expenses
Attributable
to the Provider
Details of the Technology
Services Procured
RMB’000
Supplier L A Shanghai-based
company focusing on
software development
and other technology
development,
consulting, transfer,
and promotion
services
1,937 Technological development
services relating to software
applications on enterprises’
full life-cycle management
of their individual users for
purposes of facilitating
product sales, after-sale and
other customer services,
including functions such as
user profiling and
management of sales leads,
user identity, promotion
activities, and membership
and benefits, etc., which
supplemented our
technologies applied in
customer service related
scenarios
Supplier M A Shanghai-based
company focusing on
technology
development, transfer,
consulting and other
services in the field
of network
technology
1,280 Technological development
services relating to
livestreaming application and
management system realizing
functions such as accounts
management and data
statistics, which
supplemented our
technologies applied in
e-commerce and retailing
related scenarios
FINANCIAL INFORMATION
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--- page 430 ---
Major Technology
Service Providers
for 2022 Background
Research and
Development
Expenses
Attributable
to the Provider
Details of the Technology
Services Procured
RMB’000
Supplier N A Jiangsu-based
company focusing on
AI industry
application system
integration services
and software
development
10,663 Technological development
services relating to voice and
image data collection and
training, as well as AI
algorithm optimization for
purposes of training our AI
algorithms
Supplier J A Shanghai-based
company focusing on
computer system
integration services
and computer
software
development, design
and production
9,003 Technological development
services relating to
intelligent processing hub
based on big data, covering
data integration, storage,
processing, computing and
application, which could be
applied in projects where
data interconnection among
various heterogeneous
platforms such as that on big
data, IoT, user and visitor
management, video storage,
city infrastructure
management, etc., would be
needed
Supplier L A Shanghai-based
company focusing on
software development
and other technology
development,
consulting, transfer,
and promotion
services
5,258 Technological development
services relating to software
applications on enterprises’
full life-cycle management
of their individual users for
purposes of facilitating
product sales, after-sale and
other customer services,
including functions such as
user profiling and
management of sales leads,
user identity, promotion
activities, and membership
and benefits, etc., which
supplemented our
technologies applied in
customer service related
scenarios
FINANCIAL INFORMATION
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--- page 431 ---
Major Technology
Service Providers
for 2023 Background
Research and
Development
Expenses
Attributable
to the Provider
Details of the Technology
Services Procured
RMB’000
Supplier J A Shanghai-based
company focusing on
computer system
integration services
and computer
software
development, design
and production
8,719 Technological development
services relating to data
training and management
platform that enhanced our
data processing capabilities,
allowing such key functions
as managing multiple
training assignments based
upon different algorithm
frameworks, intelligently
allocating computing
resources and optimizing
parameters, managing and
evaluating models, scalably
integrating other systems,
and improving data security
and privacy protection
Supplier O For details, see
“Business – Suppliers
and Procurement –
Top Suppliers” in this
prospectus
7,358 Technological development
services relating to AI
algorithm optimization
targeting automatic analysis
of statutory and regulatory
texts in lieu of human labor,
which improved our
conversational AI
technologies’ performance in
serving administrative
service related scenarios
Supplier P For details, see
“Business – Suppliers
and Procurement –
Top Suppliers” in this
prospectus
8,269 Technological development
services relating to data
training based on a
centralized data platform
capable of managing,
processing and distributing
massive data involved in
ICV-related scenarios, so
that our technologies could
better serve the said
scenarios
FINANCIAL INFORMATION
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--- page 432 ---
Major Technology
Service Providers
for 2023 Background
Research and
Development
Expenses
Attributable
to the Provider
Details of the Technology
Services Procured
RMB’000
Supplier L A Shanghai-based
company focusing on
software development
and other technology
development,
consulting, transfer,
and promotion
services
5,836 Technological development
services relating to software
applications on enterprises’
full life-cycle management
of their individual users for
purposes of facilitating
product sales, after-sale and
other customer services,
including functions such as
user profiling and
management of sales leads,
user identity, promotion
activities, and membership
and benefits, etc., which
supplemented our
technologies applied in
customer service related
scenarios; processing and
analysis services for natural
language data via Enterprise
Wechat
Supplier R A Shandong-based
company focusing on
basic
telecommunication
services, information
system integration
services, software
development and
network technology
services
6,795 Server hosting services for the
purpose of continuing
establishing our AI
empowerment computing
center. For details, see
“Business – Our
Technologies – AI
Technologies – AI
Empowerment Computing
Center” in this prospectus.
For details of the salient terms of our agreements with our third party technology service
providers during the Track Record Period, see “Business – Suppliers and Procurement” in this
section.
FINANCIAL INFORMATION
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--- page 433 ---
Selling and Marketing Expenses
During the Track Record Period, our selling and marketing expenses primarily consisted
of (i) employee benefit expenses, which primarily represented wages and benefits of our selling
and marketing staff; (ii) marketing and traveling expenses; (iii) depreciation and amortization;
and (iv) others. The following table sets forth a breakdown of our selling and marketing
expenses for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Employee benefit expenses 2,091 2,656 5,779
Marketing and traveling expenses 827 3,957 3,268
Depreciation and amortization 138 518 663
Others 106 118 637
Total 3,162 7,249 10,347
Administrative and Other Operating Expenses
During the Track Record Period, our administrative and other operating expenses
primarily consisted of (i) employee benefit expenses, which primarily represented wages and
benefits of our administrative and other staff; (ii) professional service and other consulting fees
in relation to various legal, financial and consulting services; (iii) depreciation and
amortization; and (iv) others in relation to various miscellaneous costs. The following table
sets forth a breakdown of our administrative and other operating expenses for the years
indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Employee benefit expenses 9,424 13,185 18,281
Professional service and other
consulting fees 9,658 7,255 22,807
Depreciation and amortization 1,648 5,733 9,926
Others 3,822 5,313 7,485
Total 24,552 31,486 58,499
FINANCIAL INFORMATION
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--- page 434 ---
Impairment Loss on Trade Receivables
During the Track Record Period, our impairment loss on trade receivables represented the
allowance for credit losses on our trade receivables. In 2021, 2022 and 2023, we had
impairment loss on trade receivables of RMB17.4 million, RMB42.6 million and RMB55.4
million, respectively.
Net Finance Costs
During the Track Record Period, our finance income represented interest income from
bank deposits and our finance costs primarily consisted of (i) interest on bank loans and other
borrowings; (ii) interest on borrowings from related parties; and (iii) interest on lease
liabilities. The following table sets forth a breakdown of our net finance costs for the years
indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Interest income from bank deposits (30) (31) (73)
Finance income (30) (31) (73)
Interest on bank loans and other
borrowings 7,839 8,532 11,132
Interest on borrowings from related
parties – 130 –
Interest on lease liabilities 374 403 637
Finance costs 8,213 9,065 11,769
8,183 9,034 11,696
Changes in Carrying Amount of Redeemable Capital Contributions
During the Track Record Period, changes in carrying amount of redeemable capital
contributions represented that in relation to equity investments from the Series A Investors,
Series B Investors, Series B+ Investors and Series C Investors classified as current liabilities.
For details, see “– Discussion of Selected Items from Consolidated Statements of Financial
Position – Redeemable Capital Contributions” in this section. In 2021, 2022 and 2023, such
changes in carrying amount amounted to RMB26.0 million, RMB157.5 million and RMB146.9
million, respectively.
FINANCIAL INFORMATION
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--- page 435 ---
Changes in Fair Value of Financial Assets Measured at Fair Value Through Profit or Loss
During the Track Record Period, changes in fair value of financial assets measured at fair
value through profit or loss represented that in relation to our strategic investment in a private
company incorporated in PRC that primarily engages in the manufacturing and sales of AI
hardware. For details, see “– Discussion of Selected Items from Consolidated Statements of
Financial Position – Financial Assets Measured at Fair Value through Profit or Loss (FVPL)”
in this section. In 2021, 2022 and 2023, such changes in fair value amounted to nil, RMB8.3
million and RMB0.3 million, respectively.
Income Tax
During the Track Record Period, our income tax consisted of current income tax and
deferred tax. Our Company obtained the qualification as high-technology enterprise and was
entitled to a preferential income tax rate of 15% for each of 2021, 2022 and 2023. Under the
PRC Income Tax Law and its relevant regulations, 75% additional tax deduction was allowed
for our qualified research and development expenses in 2021 and the nine months ended
September 30, 2022, and 100% additional tax deduction was allowed for our qualified research
and development expenses from October 1, 2022 to December 31, 2023. For details of other
preferential tax treatments that certain of our subsidiaries were entitled to during the Track
Record Period, see Note 7 to the Accountants’ Report in Appendix I to this prospectus. For
details of our deferred tax assets and liabilities, see Note 27(b) to the Accountants’ Report in
Appendix I to this prospectus. The following table sets forth the components of our income tax
for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Current tax
Provision for the year 11,042 81 10,354
(Over)-provision in respect of prior
years – – (375)
Deferred tax
Origination and reversal of temporary
differences (2,995) (5,154) (9,533)
Total 8,047 (5,073) 446
FINANCIAL INFORMATION
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--- page 436 ---
PERIOD TO PERIOD COMPARISON OF RESULTS OF OPERATIONS
2023 Compared to 2022
Revenue
Our total revenue increased from RMB515.0 million in 2022 to RMB813.0 million in
2023, primarily due to our continuous expansion of operational scale, which drove our revenue
from each of our four key end-customer industries to increase simultaneously, the continuous
expansion of our customer base, as well as the fact that our revenue in 2022 had been
temporarily negatively impacted by the COVID-19 pandemic. Our revenue from automotive
and transportation increased substantially from RMB83.4 million in 2022 to RMB191.1 million
in 2023, primarily due to the increased purchase of our solutions from our existing major
customers and the expansion of customer base in the industry. For instance, Customer A, one
of our major customers in automotive and transportation during the Track Record Period that
contributed to our second largest project in 2021 and fourth largest project in 2022 in terms of
revenue contribution further expanded its purchase from us in 2023. Specifically, the revenue
generated from Customer A increased 27.3% in 2023 as compared with 2022. Our revenue from
city management and administration also increased substantially from RMB192.7 million in
2022 to RMB321.2 million in 2023, primarily due to our continuous offering of solutions for
intelligent towns and more diversified types of administrative platforms, as well as the
acquisition of Jinxun Digital Intelligence completed in December 2022. For instance, three of
our five largest projects in terms of revenue contribution in 2023 were from city management
and administration. Our revenue from telecommunications industry increased from RMB91.8
million in 2022 to RMB174.0 million in 2023, primarily due to the increased purchase of our
solutions from our existing customers. For instance, Customer B, one of our major customers
in telecommunications industry during the Track Record Period that contributed to our fifth
largest project in 2021 and third largest project in 2022 in terms of revenue contribution further
expanded its purchase from us in 2023. Specifically, the revenue generated from Customer B
increased 17.4% in 2023 as compared with 2022. Our revenue from finance industry also
increased slightly from RMB79.7 million in 2022 to RMB84.5 million in 2023.
Our revenue from other industries decreased from RMB44.0 million in 2022 to RMB30.2
million in 2023, primarily due to our primary focus on operating in our four key end-customer
industries. Our other revenue from providing promotion services for the sales of
telecommunications terminals and other telecommunications resources and services decreased
from RMB23.4 million in 2022 to RMB12.0 million in 2023, primarily due to our investment
of greater financial resources and efforts in the former period when we initiated the provision
of the said services.
Cost of Revenue
Our cost of revenue increased from RMB313.5 million in 2022 to RMB487.6 million in
2023, which was generally in line with the growth of our revenue.
FINANCIAL INFORMATION
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Gross Profit and Gross Profit Margin
As a result of the foregoing, our gross profit increased by 61.5% from RMB201.5 million
in 2022 to RMB325.4 million in 2023. Our gross profit margin increased slightly from 39.1%
in 2022 to 40.0% in 2023.
Other Revenue
Our other revenue increased from RMB11.0 million in 2022 to RMB27.2 million in 2023,
primarily due to the government grants that we newly received in 2023. Such government
grants that we newly received in 2023 primarily consisted of those that were income-related in
nature, including project-based rewards by local governmental entities in Shanghai for our
technological credentials and endeavors, such as “Project Support for High and New
Technology Enterprises in Minhang District” (ܵand “Little Giant
Project Subsidy by the Science and Technology Commission of Shanghai Municipality” ( ɪऎ
ึʃ̶ɛධͦ໾൨), as well as V AT refund.
Research and Development Expenses
Our research and development expenses increased significantly from RMB64.0 million in
2022 to RMB98.8 million in 2023, as we continuously increased our research and development
efforts to enhance our technological capabilities and to meet the needs of our business growth.
More specifically, the increase was primarily attributable to (i) an increase in technology
service fees from RMB29.1 million in 2022 to RMB46.4 million in 2023, primarily in relation
to data training and AI algorithm optimization in line with the increased demand for our
solutions and thus the greater data volume involved; (ii) an increase in employee benefit
expenses from RMB23.9 million in 2022 to RMB34.8 million in 2023, mainly due to the
increased headcounts and compensation level of our research and development staff as a result
of the expansion of our research and development team; and (iii) an increase in depreciation
and amortization in association with our research and development activities from RMB8.9
million in 2022 to RMB15.6 million in 2023.
Selling and Marketing Expenses
Our selling and marketing expenses increased from RMB7.2 million in 2022 to RMB10.3
million in 2023, primarily driven by an increase in employee benefit expenses from RMB2.7
million in 2022 to RMB5.8 million in 2023, mainly due to the increased headcounts and
compensation level of our selling and marketing staff as a result of the expansion of our sales
team.
Administrative and Other Operating Expenses
Our administrative and other operating expenses increased from RMB31.5 million in
2022 to RMB58.5 million in 2023, primarily as a result of (i) a significant increase in
professional service and other consulting fees from RMB7.3 million in 2022 to RMB22.8
million in 2023 in relation to the Global Offering; (ii) an increase in employee benefit expenses
from RMB13.2 million in 2022 to RMB18.3 million in 2023, mainly due to the increased
FINANCIAL INFORMATION
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headcounts and compensation level of our administrative and other staff as a result of the
expansion of our management and administration team and increased number of operating
subsidiaries; and (iii) an increase in depreciation and amortization in association with our
administrative and other operating activities from RMB5.7 million in 2022 to RMB9.9 million
in 2023.
Impairment Loss on Trade Receivables
Our impairment loss on trade receivables increased from RMB42.6 million in 2022 to
RMB55.4 million in 2023, reflecting a substantial slowdown in the increase of our loss
allowance on trade receivables. For details of our progresses made on collection of our trade
receivables since 2023, see “– Discussion of Selected Items from Consolidated Statements of
Financial Position – Trade and Other Receivables – Trade Receivables” in this section.
Net Finance Costs
Our net finance costs increased slightly from RMB9.0 million in 2022 to RMB11.7
million in 2023, primarily due to an increase in interest on bank loans and other borrowings.
Changes in Carrying Amount of Redeemable Capital Contributions
Our changes in carrying amount of redeemable capital contributions decreased from
RMB157.5 million in 2022 to RMB146.9 million in 2023, which was primarily related to the
expected amount to be paid to the relevant investors upon redemption or liquidation in relation
to the redemption rights and liquidation preference under their equity investments.
Changes in Fair V alue of Financial Assets Measured at Fair V alue through Profit or Loss
Our changes in fair value of financial assets measured at fair value through profit or loss
decreased from RMB8.3 million in 2022 to RMB0.3 million in 2023, which was related to our
strategic investment in a private company incorporated in PRC that primarily engages in the
manufacturing and sales of AI hardware in 2021.
Income Tax
Our income tax changed from a tax credit of RMB5.1 million in 2022 to a tax charge of
RMB0.4 million in 2023, primarily due to a significant increase in our current tax provision
for the year.
Loss for the Y ear
As a result of the foregoing, our loss for the year decreased from RMB85.8 million in
2022 to RMB29.2 million in 2023.
FINANCIAL INFORMATION
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2022 Compared to 2021
Revenue
Our total revenue increased from RMB459.9 million in 2021 to RMB515.0 million in
2022, primarily due to the growth in our revenue from city management and administration and
telecommunications industry. Our revenue from city management and administration increased
from RMB165.1 million in 2021 to RMB192.7 million in 2022, primarily due to our continuous
offering of solutions for intelligent towns and other industrial parks, as well as the increased
purchase of our solutions from our existing customers. Our revenue from telecommunications
industry also increased from RMB68.4 million in 2021 to RMB91.8 million in 2022, primarily
due to the increased purchase of our solutions from our existing customers. For instance,
Customer B, one of our major customers in telecommunications industry during the Track
Record Period that contributed to our fifth largest project in 2021 and third largest project in
2022 in terms of revenue contribution further expanded its purchase from us in 2022.
Specifically, the revenue generated from Customer B increased 173.6% in 2022 as compared
with 2021. Our revenue from automotive and transportation also increased from RMB81.3
million in 2021 to RMB83.4 million in 2022. Leveraging our IoV-related service experiences
accumulated for more than one decade and our recent penetration into V2X scenario, we expect
that our revenue from automotive and transportation will be further driven by the rapid
technological developments and proliferation of autonomous driving and new-energy vehicles
in China. Our revenue from finance industry decreased from RMB96.1 million in 2021 to
RMB79.7 million in 2022, primarily due to our temporarily reduced business transactions in
2022 with one of our major customers that contributed to our third largest project in 2021 in
terms of revenue contribution due to the adverse impact of COVID-19 on the end users’ timely
payment. However, based on the mutual understanding between us and such customer, we
believe that business transactions between the two parties will resume along with the decline
of the spread of COVID-19 in China since 2023.
Cost of Revenue
Our cost of revenue increased from RMB307.8 million in 2021 to RMB313.5 million in
2022, which was generally in line with the growth of our revenue.
Gross Profit and Gross Profit Margin
As a result of the foregoing, our gross profit increased by 32.4% from RMB152.2 million
in 2021 to RMB201.5 million in 2022. Our gross margin increased from 33.1% in 2021 to
39.1% in 2022, which was primarily due to the increased level of modularization and
standardization of our solutions. For instance, two of our five largest projects in terms of
revenue contribution in 2022 were realized through software only or software plus hardware
solutions featuring relatively high project-based gross profit margin.
FINANCIAL INFORMATION
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Other Revenue
Our other revenue increased from RMB7.7 million in 2021 to RMB11.0 million in 2022,
primarily due to the government grants that we newly received in 2022.
Research and Development Expenses
Our research and development expenses increased significantly from RMB36.3 million in
2021 to RMB64.0 million in 2022, as we further increased our research and development
efforts to enhance our technological capabilities and to meet the needs of our business growth.
More specifically, the increase was primarily attributable to (i) a significant increase in
employee benefit expenses from RMB13.5 million in 2021 to RMB23.9 million in 2022,
mainly due to the increased headcounts and compensation level of our research and
development staff as a result of the expansion of our research and development team; and (ii)
a significant increase in technology service fees from RMB20.1 million in 2021 to RMB29.1
million in 2022 as a result of our iterative and continuous development in relation to our
product engine and the analytic and application capabilities of our solutions, etc., in order to
further the penetration of our solutions into different end-customer industries.
Selling and Marketing Expenses
Our selling and marketing expenses increased from RMB3.2 million in 2021 to RMB7.2
million in 2022, which was primarily driven by our continuous efforts to enhance our brand
awareness and investments in engaging with existing customers and attracting new customers.
More specifically, the increase was primarily attributable to (i) an increase in marketing and
traveling expenses from RMB0.8 million in 2021 to RMB4.0 million in 2022, mainly due to
our advertisement placements to promote our solutions in automotive and transportation and
also build our brand; and (ii) an increase in employee benefit expenses from RMB2.1 million
in 2021 to RMB2.7 million in 2022, mainly due to the increased headcounts and compensation
level of our selling and marketing staff as a result of the expansion of our sales team.
Administrative and Other Operating Expenses
Our administrative and other operating expenses increased from RMB24.6 million in
2021 to RMB31.5 million in 2022, primarily as a result of (i) an increase in depreciation and
amortization from RMB1.6 million in 2021 to RMB5.7 million in 2022, mainly due to the
increased amortization of our acquired software; and (ii) an increase in employee benefit
expenses from RMB9.4 million in 2021 to RMB13.2 million in 2022, mainly due to the
increased headcounts and compensation level of our administrative and other staff as a result
of the expansion of our management and administration team to support our business growth.
FINANCIAL INFORMATION
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Impairment Loss on Trade Receivables
Our impairment loss on trade receivables increased from RMB17.4 million in 2021 to
RMB42.6 million in 2022, which was in line with the substantial increase in our trade
receivables during the same years as driven by the overall growth in the revenue generated
from our solutions. For details, see “– Discussion of Selected Items from Consolidated
Statements of Financial Position – Trade and Other Receivables – Trade Receivables” in this
section.
Net Finance Costs
Our net finance costs increased slightly from RMB8.2 million in 2021 to RMB9.0 million
in 2022, primarily due to an increase in interest on bank loans and other borrowings.
Changes in Carrying Amount of Redeemable Capital Contributions
Changes in carrying amount of redeemable capital contributions increased from RMB26.0
million in 2021 to RMB157.5 million in 2022, primarily due to an increase in the expected
amount to be paid to the relevant investors upon redemption or liquidation in relation to the
redemption rights and liquidation preference under their equity investments.
Changes in Fair V alue of Financial Assets Measured at Fair V alue through Profit or Loss
Changes in fair value of financial assets measured at fair value through profit or loss
increased from nil in 2021 to RMB8.3 million in 2022, which was related to our strategic
investment in a private company incorporated in PRC that primarily engages in the
manufacturing and sales of AI hardware in 2021.
Income Tax
Our income tax changed from a tax charge of RMB8.0 million in 2021 to a tax credit of
RMB5.1 million in 2022, primarily due to a significant decrease in our current tax provision
for the year.
Profit for the Y ear
As a result of the foregoing, we record net profit of RMB36.4 million in 2021 and net loss
of RMB85.8 million in 2022.
FINANCIAL INFORMATION
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DISCUSSION OF SELECTED ITEMS FROM CONSOLIDATED STATEMENTS OF
FINANCIAL POSITION
The table below sets forth selected items from our consolidated statements of financial
position as of the dates indicated:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current assets
Property and equipment 4,973 64,530 96,647
Right-of-use assets 7,702 10,694 14,616
Intangible assets 24,236 110,950 110,682
Goodwill 17,111 39,168 39,168
Interests in associates 360 2,041 230
Equity securities designated at fair
value through other comprehensive
income (FVOCI) 516 560 771
Financial assets measured at fair value
through profit or loss (FVPL) 20,000 28,337 28,595
Prepayments 72,909 34,360 179,956
Deferred tax assets 5,184 10,038 18,399
Total non-current assets 152,991 300,678 489,064
Current assets
Inventories and other contract costs 112,475 95,269 7,653
Trade and other receivables 242,812 339,674 602,705
Prepayments 95,296 139,219 233,834
Cash 10,641 20,434 46,876
Total current assets 461,224 594,596 891,068
Current liabilities
Trade and other payables 46,518 59,433 43,389
Contract liabilities 26,732 31,127 97,423
Bank loans and other borrowings 150,663 211,650 342,000
Lease liabilities 2,302 4,128 8,115
Taxation payable 2,897 2,890 3,169
Redeemable capital contributions 265,666 527,970 852,912
Total current liabilities 494,778 837,198 1,347,008
Net current liabilities (33,554) (242,602) (455,940)
FINANCIAL INFORMATION
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As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current liabilities
Bank loans and other borrowings – 10,000 10,000
Lease liabilities 6,614 8,589 10,684
Deferred tax liabilities 2,016 3,973 2,832
Deferred income 1,047 871 2,036
Total non-current liabilities 9,677 23,433 25,552
Net assets 109,760 34,643 7,572
Capital and reserves
Share capital 25,670 28,290 31,059
Reserves 81,389 (8,349) (42,742)
Total equity attributable to equity
shareholders of our Company 107,059 19,941 (11,683)
Non-controlling interests 2,701 14,702 19,255
Total equity 109,760 34,643 7,572
Current Assets and Liabilities
The table below sets forth our current assets and current liabilities as of the dates
indicated:
As of December 31,
As of
April 30,
2021 2022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Current assets
Inventories and other contract costs 112,475 95,269 7,653 5,059
Trade and other receivables 242,812 339,674 602,705 611,718
Prepayments 95,296 139,219 233,834 264,220
Cash 10,641 20,434 46,876 49,726
Total current assets 461,224 594,596 891,068 930,723
FINANCIAL INFORMATION
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As of December 31,
As of
April 30,
2021 2022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Current liabilities
Trade and other payables 46,518 59,433 43,389 41,424
Contract liabilities 26,732 31,127 97,423 55,131
Bank loans and other borrowings 150,663 211,650 342,000 434,840
Lease liabilities 2,302 4,128 8,115 9,189
Taxation payable 2,897 2,890 3,169 885,115
Redeemable capital contributions 265,666 527,970 852,912 3,185
Total current liabilities 494,778 837,198 1,347,008 1,428,884
Net current liabilities (33,554) (242,602) (455,940) (498,161)
Our net current liabilities increased from RMB33.6 million as of December 31, 2021 to
RMB242.6 million as of December 31, 2022, mainly because our total current assets increased
from RMB461.2 million as of December 31, 2021 to RMB594.6 million as of December 31,
2022, primarily due to an increase in our trade and other receivables, while our total current
liabilities increased from RMB494.8 million as of December 31, 2021 to RMB837.2 million as
of December 31, 2022, primarily due to an increase in our (i) redeemable capital contributions
significantly from RMB265.7 million as of December 31, 2021 to RMB528.0 million as of
December 31, 2022; and (ii) bank loans and other borrowings from RMB150.7 million as of
December 31, 2021 to RMB211.7 million as of December 31, 2022. Our net current liabilities
further increased to RMB455.9 million as of December 31, 2023, mainly because our total
current assets increased from RMB594.6 million as of December 31, 2022 to RMB891.1
million as of December 31, 2023, primarily due to an increase in our trade and other
receivables and prepayments as we scaled up our operations, while our total current liabilities
increased from RMB837.2 million as of December 31, 2022 to RMB1,347.0 million as of
December 31, 2023, primarily due to an increase in our (i) redeemable capital contributions
significantly from RMB528.0 million as of December 31, 2022 to RMB852.9 million as of
December 31, 2023; and (ii) bank loans and other borrowings from RMB211.7 million as of
December 31, 2022 to RMB342.0 million as of December 31, 2023. The aforementioned
significant amount of our redeemable capital contributions was in relation to our obligation to
repurchase equity investments respecting the Pre-IPO Investments and as a result of our
growing market capitalization, and the increase in our bank loans and other borrowings were
incurred to fund our continuously expanded business.
FINANCIAL INFORMATION
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We expect to turn our net current liabilities position into net current assets upon
completion of the Listing and the Global Offering, as carrying amount of such redeemable
capital contributions will be reclassified from financial liabilities to equity as a result of the
termination of the preferred rights. For details, see “Financial Information – Discussion on
Selected Items from Consolidated Statements of Financial Position – Redeemable Capital
Contributions” in this prospectus. Furthermore, we endeavor to improve our net current
position by improving our operating efficiency through enhanced cost control measures,
therefore leading to sustainable growth with limited incremental costs. Moreover, we will
further manage our cash flows, aiming to reach better liquidity and improved cash position
which in turn can increase our current assets.
Our net assets decreased from RMB109.8 million as of December 31, 2021 to RMB34.6
million as of December 31, 2022, mainly reflected changes in equity primarily resulting from
our loss for the year of 2022 of RMB85.8 million. Our net assets decreased from RMB34.6
million as of December 31, 2022 to RMB7.6 million as of December 31, 2023, mainly reflected
changes in equity primarily resulting from our loss for the year of 2023 of RMB29.2 million.
Property and Equipment
During the Track Record Period, our property and equipment primarily consisted of
electronic equipment, furniture, servers, vehicles, construction-in-progress and leasehold
improvements. The following table sets forth a breakdown of our property and equipment as
of the dates indicated:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Electronic equipment 2,008 1,475 2,801
Furniture 314 260 575
Servers 1,778 2,293 81,568
Vehicles 23 23 23
Construction-in-progress 253 60,172 –
Leasehold improvements 597 307 11,680
4,973 64,530 96,647
Our property and equipment increased from RMB5.0 million as of December 31, 2021 to
RMB64.5 million as of December 31, 2022, and further to RMB96.6 million as of December
31, 2023, primarily due to significant additions of construction-in-progress, which had been
transferred as fixed assets as of December 31, 2023, as a result of the construction of our AI
empowerment computing center.
FINANCIAL INFORMATION
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Right-of-Use Assets
During the Track Record Period, our right-of-use assets primarily related to our leased
buildings used in our operations. Our right-of-use assets increased from RMB7.7 million as of
December 31, 2021 to RMB10.7 million as of December 31, 2022, and further to RMB14.6
million as of December 31, 2023, primarily due to our entry into new leases to support our
business expansions and our modifications made thereto in 2023.
Intangible Assets
During the Track Record Period, our intangible assets primarily consisted of software and
patents. The following table sets forth a breakdown of our intangible assets as of the dates
indicated:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Software 16,173 95,056 96,988
Patents 8,063 15,894 13,694
24,236 110,950 110,682
Our intangible assets increased from RMB24.2 million as of December 31, 2021 to
RMB111.0 million as of December 31, 2022, primarily due to continuous additions of (i)
purchase of software in relation to enhancing our technological development and
accumulations, improving our service capabilities, as well as offering specific solutions; and
(ii) patents as a result of our acquisitions of Jinxun Digital Intelligence in 2022. While our
solutions offered during the Track Record Period were based upon our core technologies, we
made significant purchase of software during the Track Record Period primarily for purposes
of internal corporate management and administration, as well as in relation to: (i) video-related
areas such as intelligent human image recognition and image and video storage, which
synergize with our core conversational AI technologies to allow speedy offering of solutions
catering to enterprise-level users’ demands and facilitate the development and
commercialization of visualizable conversational AI in the short term; (ii) management and
optimization of multimodal data, which could improve our efficiency for AI algorithm training;
and (iii) other technologies that render coordination in specific application scenarios of our
solutions, such as that in city management and administration and automotive and
transportation. The net book value of our software increased significantly from RMB16.2
million as of December 31, 2021 to RMB95.1 million as of December 31, 2022, primarily due
to our increased purchase of software in relation to the aforementioned internal corporate
FINANCIAL INFORMATION
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management and administration, training and optimization of AI algorithms, and the
development of visualizable conversational AI. Our intangible assets remained relatively stable
at RMB111.0 million as of December 31, 2022 and RMB110.7 million as of December 31,
2023.
Goodwill
Our goodwill increased from RMB17.1 million as of December 31, 2021 to RMB39.2
million as of December 31, 2022 and December 31, 2023, as a result of our acquisition of
Jinxun Digital Intelligence in 2022. For details of the acquisitions, see “History, Development
and Corporate Structure – Acquisitions During the Track Record Period” in this prospectus.
Goodwill is attributable to the acquired market share and economies of scale expected to
be derived from combining with the operations of our Group following these acquisitions. We
carry out our annual impairment test on goodwill by comparing the recoverable amounts of
cash-generating unit (CGU) or group of CGUs to the carrying amounts. Goodwill arising from
the acquisitions of Yuanya Information and Jinxun Digital Intelligence was monitored
separately and assessed as separate CGUs for the purpose of impairment testing. Specifically,
impairment review on the goodwill had been conducted by our management as of December
31, 2021, 2022 and 2023. The recoverable amounts of the CGUs are determined based on
value-in-use (VIU) calculations. These calculations use cash flow projections based on
financial budgets approved by our management covering a five-year period. Cash flows beyond
the five-year period are extrapolated using an estimated weighted average growth rate. The
growth rates used do not exceed the long-term average growth rates for the business in which
the CGU operates.
Key assumptions of the significant CGU as of December 31, 2021 are set out as follow:
Yuanya
Information
Compound annual growth rate of revenue during the five-year
forecast period 12.5%
Long-term growth rate 2.5%
Discount rate 16.3%
Key assumptions of the significant CGU as of December 31, 2022 are set out as follow:
Yuanya
Information
Jinxun Digital
Intelligence
Compound annual growth rate of revenue during
the five-year forecast period 13.0% 7.9%
Long-term growth rate 2.3% 2.3%
Discount rate 16.3% 16.8%
FINANCIAL INFORMATION
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Key assumptions of the significant CGU as of December 31, 2023 are set out as follow:
Yuanya
Information
Jinxun Digital
Intelligence
Compound annual growth rate of revenue during
the five-year forecast period 8.1% 19.5%
Long-term growth rate 2.2% 2.2%
Discount rate 16.3% 16.8%
We adopted the discounted cash flow (“ DCF”) method to determine the recoverable
amount of the CGU with the assistance of an independent valuer. In order to perform the
impairment assessment, we prepared cash flow projections of the CGU as of December 31,
2021, 2022 and 2023, and specific risk has been considered in the risk adjusted cash flow
projections. After considering all the inputs, the pre-tax discount rate derived as of each of
December 31, 2021, 2022 and 2023 was around to 16.3% and 16.8% as the inputs to the model
in determining the discount rate remained similar as of each of the same dates.
Details of the headroom calculated based on the recoverable amounts deducting the
carrying amounts allocated for the significant CGUs are set out as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Yuanya Information 2,754 4,004 7,864
Jinxun Digital Intelligence – 2,854 7,861
Our management has undertaken sensitivity analysis on the impairment test of goodwill.
The following table sets out the hypothetical changes to annual growth rate during the five-year
forecast and discount rate that would, in isolation, have removed the remaining headroom
respectively as of December 31, 2021:
Yuanya
Information
Compound annual growth rate of revenue during the five-year
forecast period -0.5%
Discount rate +0.7%
FINANCIAL INFORMATION
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The following table sets out the hypothetical changes to annual growth rate during the
five-year forecast and discount rate that would, in isolation, have removed the remaining
headroom respectively as of December 31, 2022:
Yuanya
Information
Jinxun Digital
Intelligence
Compound annual growth rate of revenue during
the five-year forecast period -0.6% -0.6%
Discount rate +1.1% +0.6%
The following table sets out the hypothetical changes to annual growth rate during the
five-year forecast and discount rate that would, in isolation, have removed the remaining
headroom respectively as of December 31, 2023:
Yuanya
Information
Jinxun Digital
Intelligence
Compound annual growth rate of revenue during
the five-year forecast period -2.0% -2.0%
Discount rate +1.9% +1.6%
Our Directors determined that no impairment on goodwill was required as of December
31, 2021, 2022 and 2023 with reference to the recoverable amounts. We performed annual
impairment test on goodwill at the end of each reporting year. The recoverable amount of the
CGU based on the VIU calculations is higher than its carrying amount as of December 31,
2021, 2022 and 2023. With regard to the assessment of the VIU of the CGUs, our Directors
believe that any reasonably possible change in any of the above key assumptions would not
cause the carrying value, including goodwill, of the CGUs to exceed the recoverable amounts.
For details, see Note 15 to the Accountants’ Report in Appendix I to this prospectus.
Financial Assets Measured at Fair Value through Profit or Loss (FVPL)
During the Track Record Period, our financial assets measured at FVPL arose from our
strategic investment of unlisted equity securities in a private company incorporated in PRC that
primarily engages in the manufacturing and sales of AI hardware. The investment was
classified as financial assets measured at FVPL because it contains substantive liquidation
preference and is redeemable at our option if the invested company is liquidated in the future.
The redeemable amount is calculated by investment consideration plus remaining net assets on
pro rata basis. Our financial assets measured at FVPL increased from RMB20.0 million as of
December 31, 2021 to RMB28.3 million as of December 31, 2022, and further to RMB28.6
million as of December 31, 2023, as a result of the business growth of such invested company.
For details, see Note 18 to the Accountants’ Report in Appendix I to this prospectus.
FINANCIAL INFORMATION
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We have been in the past, and may in the future, prudently evaluate and consider a wide
array of potential investments in emerging businesses that are complementary to our business
to implement our long-term growth strategy, develop our solutions and expand and penetrate
the end-customer industries we cover. We select our investment target companies based on the
end-customer industry in which the target operates, the target’s strengths of technologies and
solutions, the target’s business and financial performance and the synergies between the target
and us. During the Track Record Period, we made minority equity investments in certain
private company, which were measured as financial assets at fair value through profit or loss.
We undertake prudent evaluation and approval process in making investment decisions. When
potential investment opportunities are presented to our leadership, our senior management
team will arrange dedicated personnel to conduct preliminary due diligence and evaluation
against the applicable selection criteria, the results of which will then be submitted to our
senior management team for pre-approval. Upon such pre-approval, a project working group
will be organized and third-party professionals will be engaged to conduct comprehensive due
diligence, negotiate with the target company and evaluate risks associated with the investment.
Investment agreements will be subject to review by professionals with legal and financial
expertise and our senior management team members experienced in negotiating and executing
equity investments. After making an investment, we typically conduct on-site visits at the
invested company periodically and report their operational and financial results to our senior
management team regularly, continuing to monitor its business performance. Our Board is the
ultimate decision-making authority on investments, responsible for overseeing all the
investment decisions and evaluating the reasons for the investment, and will conduct periodical
review on the returns of our investments. In particular, any investment to the following effects
shall be subject to our Board’s prior review: (i) the transaction amount (including debts and
expenses assumed) accounts for 50% or more of our Company’s audited net assets at latest
audited financial statements; (ii) the profit generated from the transaction accounts for 50% or
more of our Company’s audited net profit in the most recent accounting year; (iii) the relevant
operating revenue of the target in the most recent accounting year accounts for 50% or more
of our Company’s audited operating revenue in such most recent accounting year; or (iv) the
relevant net profit of the target in the most recent accounting year accounts for 50% or more
of our Company’s audited net profit in such most recent accounting year. These investments
will be subject to the compliance with Chapter 14 of the Listing Rules after the Listing.
Prepayments
During the Track Record Period, our prepayments primarily consisted of the current
portion of prepayments for goods and services and the non-current portion of prepayments for
purchase of property, equipment and intangible assets, as well as for services. The following
table sets forth a breakdown of our prepayments as of the dates indicated:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Current
Prepayments for goods and services 95,296 139,219 233,834
FINANCIAL INFORMATION
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As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current
Prepayments for purchase of property,
equipment and intangible assets 63,009 24,460 145,002
Prepayments for services 9,900 9,900 34,954
168,205 173,579 413,790
The current portion of our prepayments increased from RMB95.3 million as of December
31, 2021 to RMB139.2 million as of December 31, 2022, primarily in relation to our
prepayments for network resources for our city management and administration projects.
Specifically, city management and administration projects usually involve the establishment of
an intelligent town cluster where the infrastructure, administration, and various businesses of
hundreds of towns are being unified and integrated into one cloud-based platform, which
necessitates the use of network resources as fundamental resources for enterprise-level
participants in city management and administration projects. As such, we entered into a
long-term procurement agreement on such network resources with a major telecommunications
company in China. Pursuant to the agreement, we are obligated to make payment by 19
installments from 2018 to 2026. For details of the procurement agreement and our payment
obligations thereunder, see “Business – Suppliers and Procurement – Top Suppliers” in this
prospectus. The current portion of our prepayments further increased from RMB139.2 million
as of December 31, 2022 to RMB233.8 million as of December 31, 2023, which reflected the
balance of prepayments primarily related to (i) procurement of hardware components for
continuously offering software plus hardware solutions; and (ii) our research and development
programs, in addition to that in relation to the aforementioned network resources for our city
management and administration projects. Specifically, driven by our rapid revenue growth, we
expanded our offerings of software plus hardware solutions, which required us to procure a
greater volume of hardware primarily including communication devices, servers and
computers. Furthermore, we continuously outsourced from third-party technology service
providers certain research and development programs, primarily in relation to data training and
AI algorithm optimization, which was in line with the increased demand for our solutions and
thus the greater data volume involved. For details of the major technology services so procured
and the research and development expenses attributable thereto in 2023, see “– Description of
Selected Components of Consolidated Statements of Profit or Loss – Research and
Development Expenses” in this section. Such prepayments are expected to be gradually
recognized as cost of revenue in the course of our offering the software plus hardware solutions
or expensed once the relevant services are provided. The non-current portion of our
prepayments decreased from RMB72.9 million as of December 31, 2021 to RMB34.4 million
as of December 31, 2022, which reflected our suppliers’ continuous performance of their
obligations in delivering to us the prepaid property, equipment and intangible assets mainly in
relation to the construction and operation of our AI empowerment computing center, and our
FINANCIAL INFORMATION
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settlement therewith. The non-current portion of our prepayments increased significantly from
RMB34.4 million as of December 31, 2022 to RMB180.0 million as of December 31, 2023,
which reflected the balance of prepayments primarily related to that for property, equipment
and intangible assets associated with the construction and operation of our AI empowerment
computing center, as well as ICVs needed for our solutions in automotive and transportation
as we have increasingly penetrated into V2X scenario, such as in Mianyang, Sichuan.
As of the Latest Practicable Date, RMB138.6 million, accounting for approximately
59.3% of the current portion of our prepayments as of December 31, 2023, had been
subsequently settled.
Inventories and Other Contract Costs
During the Track Record Period, our inventories primarily included communication
devices, servers and computers, and perception equipment and accessories that were or are to
be integrated into our solutions. The following table sets forth a breakdown of our inventories
as of the dates indicated:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Communication devices 74,529 55,246 –
Servers and computers 37,306 30,742 593
Perception equipment and accessories – 8,134 5,561
Others 640 1,147 36
Other contract cost – – 1,463
112,475 95,269 7,653
Our inventories and other contract costs decreased from RMB112.5 million as of
December 31, 2021 to RMB95.3 million as of December 31, 2022, and further to RMB7.7
million as of December 31, 2023, which mainly reflected the continuous integration of the
hardware components anticipatorily prepared in 2021 into our solutions.
FINANCIAL INFORMATION
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The table below sets forth our inventories turnover days for the years indicated:
Y ear Ended December 31,
2021 2022 2023
Inventories turnover days* 128 121 62
Note:
* Inventories turnover days for a year is the arithmetic mean of the beginning and ending balances of
inventories for the relevant year divided by the sum of cost of sales for the relevant year divided by 365
for 2021, 2022 and 2023.
The fluctuation of our inventories turnover days during the Track Record Period was in
line with the fluctuation of our inventories as of the end of each reporting year. Our inventories
turnover days decreased from 128 days for 2021 to 121 days for 2022, which mainly reflected
the continuous integration of the hardware components anticipatorily prepared in 2021 into our
solutions. Our inventories turnover days decreased from 121 days for 2022 to 62 days for 2023,
reflecting the decreased balance of our inventories as of December 31, 2023 in comparison
with December 31, 2021.
We expect that we will maintain a stable and optimal level of inventories going forward.
Our Directors confirmed that we had not experienced any material recoverability issues for our
inventories during the Track Record Period as all inventories are expected to be recovered
within one year. We do not anticipate to have any material recoverability issues for our
inventories in the foreseeable future, given that (i) the accumulation of our inventories are well
backed by pre-existing orders made from our customers and thus their sufficient demand that
have constantly driven our increased sales performance in line with our business growth, and
will be recognized as cost of revenue per the satisfaction of our related performance
obligations; (ii) we had not encountered any material impairment loss that have materially and
adversely affected our business operations caused by slow-moving inventories during the Track
Record Period; (iii) to the best knowledge of our Directors, our quality customer base
maintains healthy financial conditions in general; (iv) our inventories are predominantly
electronics or network resources that are generally not perishable in nature and can maintain
marketable value with relatively long life cycle; and (v) our management is of the view that
the risk of failure to satisfy our related performance obligations is remote considering that our
business operation and financial conditions are healthy. Our Directors believe that our
inventories will be utilized in due course in the course of our business growth and the
continuously increasing demand for our software plus hardware solutions. Besides, we have
taken effective inventory management measures, including closely monitor our inventory level
and performing inventory count and physical inspection periodically, and will from time to
time review and make sufficient provisions if needed.
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The table below sets forth an ageing analysis of our inventories by category as of
December 31, 2023:
Communication
devices
Servers and
computers
Perception
equipment
and
accessories Others Subtotal
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Within 1 year – 593 5,561 36 6,190
As of the Latest Practicable Date, RMB6.0 million, accounting for approximately 97.0%
of our inventories as of December 31, 2023, had been subsequently utilized.
Trade and Other Receivables
During the Track Record Period, our trade and other receivables primarily consisted of
trade receivables, bills receivables and other receivables mainly including value added tax
(V AT) recoverable, taxation recoverable and other deposit and receivable. Our trade and other
receivables increased from RMB242.8 million as of December 31, 2021 to RMB339.7 million
as of December 31, 2022, and further to RMB602.7 million as of December 31, 2023. The
following table sets forth a breakdown of our trade and other receivables as of the dates
indicated:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade receivables 248,068 379,103 704,682
Less: loss allowance on trade
receivables (32,368) (66,479) (121,858)
Net trade receivables 215,700 312,624 582,824
Bills receivables 10,500 – –
V AT recoverable 9,296 16,661 13,430
Taxation recoverable 1,104 8,896 650
Capitalization of listing expenses – – 3,564
Other deposit and receivable 6,212 1,493 2,237
242,812 339,674 602,705
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Trade Receivables
During the Track Record Period, our trade receivables consisted primarily of outstanding
fees due from customers in connection with the transactions with respect to our solutions.
During the Track Record Period, our trade receivables continued to increase, which was
generally driven by the overall growth in the revenue generated from our solutions. As of
December 31, 2021, 2022 and 2023, our net trade receivables amounted to RMB215.7 million,
RMB312.6 million and RMB582.8 million, respectively. Our loss allowance on trade
receivables increased during the Track Record Period driven by the increase of our trade
receivables balance, which was in line with our business growth. We measure our loss
allowance on trade receivables at lifetime expected credit losses, which are determined based
upon our historical credit loss experience with reference to all reasonable and substantial
information, including forward-looking information, historical migration rates, judgments on
future recovery risk and a characteristic analysis of credit risk. As our historical credit loss
experience does not indicate significantly different loss patterns for different customer
segments, the loss allowance based on past due status is not further distinguished among our
different customer bases. During the Track Record Period, the provision ratios for bad and
doubtful debts across different ageing ranges of our trade receivables past due did not change
materially. As of December 31, 2021, 2022 and 2023, we recorded loss allowance on trade
receivables of RMB32.4 million, RMB66.5 million and RMB121.9 million, accounting for
approximately 13.0%, 17.5% and 17.3% of our trade receivables as of the same dates,
respectively. Our Directors confirmed that our credit policies in relation to our customers
remained the same. The table below sets forth a breakdown of our trade receivables as of
December 31, 2023 with subsequent settlement as of the Latest Practicable Date by customer
types:
As of
December 31,
2023
Subsequent Settlement as of
the Latest Practicable Date
RMB’000 RMB’000
%a so f
December
31, 2023
Enterprise-level solutions
– System integrators 569,557 146,227 25.7
– Enterprise-level users 132,259 38,638 29.2
Others 2,866 2,331 81.3
Total 704,682 187,196 26.6
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The table below sets forth our trade receivables turnover days for the years indicated:
Y ears Ended December 31,
2021 2022 2023
Trade receivables turnover days* 137 222 243
Note:
* Trade receivables turnover days for a year is the arithmetic mean of the beginning and ending balances
of trade receivables for the relevant year divided by the revenue for the relevant year divided by 365
for each of 2021, 2022 and 2023.
Our trade receivables turnover days were relatively lengthy during the Track Record
Period, which was primarily due to the fact that our solutions had been increasingly offered via
large-scale projects to end customers from the public sector that features solid credit status yet
a long payment cycle with respect to such projects because of their internal financial
management and payment approval processes. Also, it is market practice that end users in
China’s enterprise-level conversational AI solution market tend to settle payments with their
conversational AI solution suppliers and/or the system integrators involved typically only after
a relatively substantial period of time subsequent to delivery and acceptance of the projects,
according to the iResearch Report. According to the same source, the settlement cycle of our
customers is in line with industry average.
Furthermore, we generated a significant percentage of revenue from offering our
solutions to system integrators that embedded our solutions into their offerings to enterprise-
level users during the Track Record Period. There is not any contractual term under our
agreements with the system integrators providing that they would only settle with us after
receiving payment from their end customers or otherwise establishing a direct correlation or
dependency between the two payment streams. Rather, we have the absolute entitlement to
payment from the system integrators within the agree-upon payment terms and conditions once
we recognize revenue upon acceptance thereby. Yet still, the pace at which the system
integrators settle with us could be factually contingent upon the timing of when they receive
payments from their end customers as a matter of commercial consideration and market
practice driven by the cash flow dynamics and operational realities within the value chain.
Since system integrators normally have significant upfront costs associated with integrating,
customizing and deploying their offerings to their end customers, their ability and tendency to
settle timely with their upstream suppliers like us could be impacted by their receipt of
payments from their end customers, which is in line with common practice in the industry. For
details of our measures to manage such impact on collection of our trade receivables, see
“Business – Customers and Customer Support” in this prospectus.
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The table below sets forth a breakdown of our trade receivables by end-customer
industries as of the dates indicated with subsequent settlement of balance of December 31,
2023 as of the Latest Practicable Date:
As of December 31,
Subsequent Settlement of
Balance of December 31, 2023
as of the Latest Practicable
Date2021 2022 2023
RMB’000 RMB’000 RMB’000 RMB’000
%a so f
December 31, 2023
City management and
administration 29,336 67,057 198,083 43,024 21.7
Automotive and transportation 20,632 27,167 112,272 29,695 26.4
Telecommunications 34,485 82,558 193,560 54,677 28.2
Finance 103,532 124,019 125,128 21,178 16.9
The table sets forth our trade receivables turnover days by end-customer industries for the
years indicated:
Y ears Ended December 31,
2021 2022 2023
Trade receivables turnover days*
Enterprise-level solutions
– City Management and
Administration 42 92 151
– Automotive and Transportation 80 105 133
– Telecommunications 180 233 290
– Finance 248 521 538
Note:
* Trade receivables turnover days for a year is the arithmetic mean of the beginning and ending balances
of trade receivables for the relevant year divided by the revenue for the relevant year divided by 365
for each of 2021, 2022 and 2023.
During the Track Record Period, our trade receivables turnover days for each of our four
key end-customer industries were influenced by whether we recognized revenue and thus
recorded trade receivables over time or at a point in time upon a customer’s acceptance of the
projects. In line with our recognition of revenue over time in relation to the majority of our
customers in city management and administration pursuant to our contractual arrangements
therewith, such customers are more likely to settle with us periodically, mainly due to which
our trade receivables turnover days for city management and administration were relatively
shorter during the Track Record Period. By contrast, our revenue for the other end-customer
industries were recognized primarily at a point in time upon acceptance of the projects. Among
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these end-customer industries, our solutions in telecommunications industry and finance
industry were primarily offered to enterprise-level users from the public sector, who tended to
settle payments after a relatively long period of time subsequent to acceptance.
Our trade receivables turnover days increased substantially from 137 days in 2021 to 222
days in 2022, primarily because COVID-19 had in particular extended the period over which
we used to collect our trade receivables. For instance, widespread lockdowns and business
closures due to COVID-19 disrupted operations for many customers/enterprise-level users,
leading to fluctuated financial performance and cash flow challenges that delayed their ability
to pay outstanding balances on time. Also, absenteeism and remote work arrangements created
operational hurdles for certain customers/enterprise-level users, which slowed down the
approval processes for releasing payments.
Our trade receivables turnover days further increased from 222 days in 2022 to 243 days
in 2023, primarily driven by our customers/enterprise-level users’ adjustment of their internal
policies for settling with their service providers in accordance with the macro-economic
changes in the aftermath of the pandemic, which was in line with market practice according to
the iResearch Report, and therefore slowed the pace at which the outstanding payments were
being settled compared with previous years. Specifically, the macro-economic landscape
experienced continuous disruptions over the past few years stemming from an intricate
combination of factors. For instance, the pandemic triggered widespread lockdowns and
restrictions, severely impacting supply chains, production and consumer spending across
various industries. The post-COVID economic recovery was further complicated by heightened
geopolitical tensions that led to trade disputes, export controls and retaliatory actions,
introducing additional uncertainties and obstacles to global trade flows. The volatile and
challenging market condition shaped by such combination of factors ranging from pandemic-
induced operational constraints to geopolitical tensions straining supply chains and trade
relationships has prompted enterprises and organizations across sectors to exercise caution in
their financial management and payment cycles to grapple with cash flow pressures.
Accordingly, our customers/enterprise-level users elected to adjust their internal policies as
they navigated these unprecedented economic conditions. Because of the same reasons, as of
the Latest Practicable Date, RMB187.2 million, accounting for approximately 26.6% of our
trade receivables as of December 31, 2023, had been subsequently settled.
Notwithstanding the foregoing, our Directors are of the view that there is no material
recoverability issue with our trade receivables, based upon the reasons set forth below:
 Recent Regulatory Development on Clearing up Overdue Payments. The PRC
central authorities in recent months have placed a strong emphasis on tackling the
issue of the public sector’s overdue trade receivables owed to enterprises and urged
concerted efforts from governmental bodies to proactively clear up trade balances
payable to businesses. For instance, on September 20, 2023, the executive meeting
of the State Council reviewed and approved the Special Action Plan for Clearing Up
Overdue Payments Owed to Enterprises (), and
pointed out that, among others, provincial-level governments must take overall
responsibility for clearing up overdue payments in their regions, with state-owned
enterprises taking the lead in repayment, so as to ensure all eligible arrears are
FINANCIAL INFORMATION
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cleared. Moreover, the Report on the Review Results of the Implementation of the
2023 Central and Local Budgets and the Draft 2024 Central and Local Budgets by
the Fiscal and Economic Affairs Committee of the 14th National People’ s Congress
(׵2023 ϋʕ̯ձή˙ཫၑੂБઋ
ၾ2024జѓ) issued on March 8, 2024 made
the suggestions for implementing the 2024 budgets and fiscal work that
governments’ overdue payments owed to enterprises shall be cleared up proactively.
 Our Internal Policies and Measures to Manage the Recovery of Our Trade
Receivables. We have adopted polices and measures to manage our credit risks and
trade receivables. With respect to customer credit management, we have grouped
customers into different credit risk levels and monitor such credit risk levels
regularly. We grant credit terms to customers in accordance with the relevant
designated credit risk levels. We normally grant our customers a credit term around
six months. As to the customers with a relatively stronger credit record, we grant
them a longer credit term around nine months. During the Track Record Period, we
did not extend our credit terms to any of our customers.
With respect to trade receivables management, we have taken active steps to
mitigate our risk exposure to customers with potential prolonged delay settlement of
trade receivables, and collect the outstanding trade receivables. For instance, we
have allocated considerable human resources on trade receivable collection efforts
in a collaborative manner, including dedicated internal teams responsible for
continually monitoring the credit profiles and operating and financial conditions of
our customers, as well as maintaining frequent communications with our customers
to implement effective credit control and proactively following up with our
customers to ensure their payments be made as scheduled. Specifically, our finance
department prepares trade receivable summaries on a weekly basis according to the
amount of revenue recognized and the amount of cash collection. These trade
receivable summaries are allocated to assigned personnel to follow up, who
reconcile the outstanding trade receivables with our customers on a monthly basis.
If a customer’s payment is overdue, our finance department will promptly provide
trade receivable details to assist the assigned personnel in the collection of the same
according to customized collection strategies formulated based upon the customer’s
balance of trade receivables and the specific ageing situations, which will be
overseen and supervised by our general manager and head of our sales department.
Through frequent and good faith communication with the customer via multiple
channels including phone calls and WeChat, we examine in details the reasons for
its failure to make timely payment, and request it to pay as soon as possible in an
monitored manner. In doing so, we strive to balance between maintaining steady
customer relationships and trade receivables collection, so as to ensure our current
stable operations while laying the foundation for future offering prospects. We also
include the collection results of overdue payments as a performance indicator of
such assigned personnel, with a view to encouraging them to achieve improved work
performance. The effectiveness of the abovementioned measures has been
FINANCIAL INFORMATION
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particularly demonstrated by the fact that approximately RMB259.5 million,
accounting for approximately 68.4% of our trade receivables as of December 31,
2022 had been subsequently settled as of the Latest Practicable Date. We also have
policies in place to ensure that trade receivables are made to the customers with an
appropriate credit history, and our management performs ongoing credit evaluations.
These evaluations focus on the customer’s past history of making payments when
due and current ability to pay, taking into account information specific to the
customer as well as pertaining to the economic environment in which the customer
operates.
 Solid Credit History of Our Customers and Our Stable Relationship Therewith.
During the Track Record Period, a significant portion of our solutions were offered
to the public sector, and we had been expanding our business in the public sector.
Enterprise-level users from the public sector, mainly including governmental
entities, public institutions and state-owned enterprises, are characterized by strong
financial backing and low default risks. With respect to our private-sector customer
base, we prioritize conducting business with reputable and financially viable
enterprise-level users, or the system integrators serving the same. Our stringent
customer selection process and due diligence measures help ensure that we mainly
engage with well-established companies demonstrating solid financial standing and
creditworthiness, as evidenced by their industry leading position in the respective
industry based on their commercial success, societal recognition or market
occupation rate. The good credit history of our customers and our stable relationship
with them thus contribute to the relatively long credit term to them, and we believe
that the credit risk inherent in our outstanding trade receivable balances due from
them is low. As we regularly assess our customers’ credit quality carefully, taking
into account their business background, the general risks associated with their
industries, their financial position, past experience and other factors, we were not
aware of any significant changes in their credit status during the Track Record
Period. Moreover, we did not have any material disagreement or disputes with our
customers on trade receivables during the Track Record Period.
 Sufficient Loss Allowance Made on Trade Receivables. Our Directors confirm
that sufficient loss allowance has been made on our trade receivables during the
Track Record Period, as we prudently conduct periodic assessment to closely
monitor our credit exposure and identify significant increases in credit risks, and,
where applicable, make timely provision for expected credit losses. The provision
ratios have been determined based upon our historical collection of payments and
future recoverability. Specifically, we performed an impairment assessment at the
end of each of the year within the Track Record Period, with loss allowance on trade
receivables always measured at an amount equal to lifetime expected credit losses
(“ECLs”). When measuring ECLs, we consider reasonable and supportable
information that is relevant and available without undue cost or effort, including
both quantitative and qualitative information and analysis based on the our historical
experience and informed credit assessment that includes forward-looking
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information. In particular, we estimate ECLs based on historical credit loss
experience, the past default experience of the debtor, general economic conditions
of the industry and country in which the debtors operates, and assess both the current
and the forecast duration of condition as of December 31, 2021, 2022 and 2023.
Moreover, individual credit evaluations are performed on all customers requiring
credit over a certain amount. These evaluations focus on the customer’s past history
of making payments when due and current ability to pay, taking into account
information specific to the customer as well as pertaining to the economic
environment in which the customer operates. Last but not least, we base the
expected loss rates on actual loss experience over the past four years, which are
adjusted to reflect differences in economic conditions during the period over which
the historical data has been collected, current conditions and our view of economic
conditions over expected lives of the receivables. For details of our credit risk
exposures and the expected loss rates of our trade receivables, see Note 30 to the
Accountants’ Report in Appendix I to this prospectus. Based upon the foregoing,
sufficient provisions have been proactively made on our trade receivables, which
ensures that our financial condition accurately reflects the potential impact of the
extended collection periods and provides a realistic assessment of our receivables
position. While the timing of our receivables collection admittedly faces the
temporary challenge influenced by the external factors and extraordinary
circumstances noted above, our Directors are of the view that there is no material
recoverability issue with our net balance of trade receivables, considering the
provisions already made.
An ageing analysis of our trade receivables and bills receivables as of the dates indicated,
based on the invoice date and net of loss allowance with subsequent settlement of balance of
December 31, 2023 as of the Latest Practicable Date, is as follows:
As of December 31,
Subsequent Settlement of
Balance of December 31, 2023
as of the Latest Practicable
Date2021 2022 2023
RMB’000 RMB’000 RMB’000 RMB’000
%a so f
December 31, 2023
Within 1 year 220,157 236,186 505,107 122,296 24.2
After 1 year but within 2 years 3,199 74,653 72,420 59,603 82.3
After 2 years but within 3 years 2,600 1,737 5,297 5,297 100.0
Over 3 years 244 48 – – –
226,200 312,624 582,824 187,196 32.1
FINANCIAL INFORMATION
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Our Directors are of the view that there is no material recoverability issue for our trade
receivables aged over one year, considering: (i) we have made the aforementioned progress in
collecting outstanding trade receivables; (ii) our customers generally have good credit standing
and debt repayment ability, especially considering that our trade receivables aged over one year
are primarily due from customers from the public sector, to whom we generally grant a credit
term around nine months. Being state-backed, such enterprise-level users as
telecommunications companies and financial institutions, though have relatively long payment
cycles, are well supported with reliable funding sources and good credit status; (iii) with our
periodic assessment of our customers’ credit quality, we were not aware of any significant
changes in their credit status during the Track Record Period; (iv) we did not have any material
disagreement or disputes with our customers on trade receivables during the Track Record
Period; (v) we have taken stringent internal measures to enhance the management and
collection of trade receivables. For details of our polices and measures to manage our credit
risks and trade receivables, see “– Trade and Other Receivables” in this section; and (vi) there
have been few cases where we were unable to collect our trade receivables historically. In
general, we do not anticipate to have any material recoverability issue with our trade
receivables. For details thereon as well as the active steps that we have taken to mitigate the
risk exposure, see “– Trade and Other Receivables” in this section.
An ageing analysis of our trade receivables and bills receivables as of the dates indicated,
by due date with subsequent settlement of balance of December 31, 2023 as of the Latest
Practicable Date, is as follows:
As of December 31,
Subsequent Settlement of
Balance of December 31, 2023
as of the Latest Practicable
Date2021 2022 2023
RMB’000 RMB’000 RMB’000 RMB’000
%a so f
December 31, 2023
Current (not past due) 220,356 221,075 491,480 102,921 20.9
Less than 12 months past due 27,773 137,776 177,186 64,585 36.5
More than 12 months but less than
24 months past due 7,760 18,359 33,882 18,075 53.3
More than 24 months but less than
36 months past due 1,563 1,755 1,996 1,615 80.9
More than 36 months past due 1,116 138 138 – –
258,568 379,103 704,682 187,196 26.6
FINANCIAL INFORMATION
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The increase of the balance of our trade receivables and bills receivables in the less than
12 months past due portion from December 31, 2021 to December 31, 2022 was mainly due
to lower recovery rate during 2022 caused by the impact of COVID-19. The increase of the
balance of our trade receivables in the current and less than 12 months past due portion from
December 31, 2022 to December 31, 2023 was primarily a result of our newly recognized
revenue in 2023.
Bills and Other Receivables
During the Track Record Period, our bills receivables primarily represented short-term
commercial acceptance bills receivables entitling us to receive the full face amount from the
banks at maturity, which generally ranged from 6 to 12 months from the date of issuance. Our
bills receivable decreased from RMB10.5 million as of December 31, 2021 to nil as of
December 31, 2022 and December 31, 2023, primarily due to our decreased acceptance of bills
receivables for settlement by our customers.
During the Track Record Period, our other receivables primarily consisted of V AT
recoverable, taxation recoverable and other deposit and receivable. Our other receivables
increased from RMB16.6 million as of December 31, 2021 to RMB27.1 million as of December
31, 2022, primarily due to the continuous increases in V AT recoverable and taxation
recoverable. Our other receivables decreased from RMB27.1 million as of December 31, 2022
to RMB19.9 million as of December 31, 2023, primarily due to a decrease in V AT recoverable
and taxation recoverable.
As of the Latest Practicable Date, RMB10.8 million, accounting for approximately 54.4%
of our bills and other receivables as of December 31, 2023, had been subsequently settled.
Cash
During the Track Record Period, our cash represented our cash at bank. Our cash
increased from RMB10.6 million as of December 31, 2021 to RMB20.4 million as of December
31, 2022, and further to RMB46.9 million as of December 31, 2023, primarily due to an
increase in cash inflows generated from principals from bank borrowings and capital
contributions from our shareholders. For details of the analysis on cash flows during the Track
Record Period, see “– Liquidity and Capital Resources – Cash Flows” in this section.
FINANCIAL INFORMATION
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Trade and Other Payables
During the Track Record Period, our trade and other payables primarily consisted of trade
payables and other payables mainly related to accrued payroll and benefits, loans from related
parties, capital contribution from an investor, consideration payable for Jinxun Digital
Intelligence acquisition, payable for acquisition of property and equipment, payable for
acquisition of service, and accrual listing expenses. Our trade and other payables increased
from RMB46.5 million as of December 31, 2021 to RMB59.4 million as of December 31, 2022.
Our trade and other payables decreased from RMB59.4 million as of December 31, 2022 to
RMB43.4 million as of December 31, 2023. The following table sets forth a breakdown of our
trade and other payables as of the dates indicated:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Payable for acquisition of property and
equipment 15,152 7,148 6,557
Payable for acquisition of service 11,000 11,303 213
Accrual listing expenses – 4,400 5,829
Deposits received 60 61 60
Other payables and accrual expenses 2,943 1,781 1,155
Trade payables 6,635 3,306 14,402
Accrued payroll and benefits 4,421 6,607 8,493
Other taxes payable 958 1,777 3,680
Loans from related parties 5,349 – –
Capital contribution from an investor – 16,755 –
Consideration payable for Jinxun
Digital Intelligence acquisition – 6,295 3,000
46,518 59,433 43,389
Trade Payables
During the Track Record Period, our trade payables represented balances due to our
suppliers for hardware and services. We settle the trade payables according to the credit terms
offered by the suppliers, and the balances of our trade payables would depend upon (i) the time
at which the products or services are delivered or performed; (ii) the settlement date; and (iii)
the amount of purchase. As a result, our trade payables decreased from RMB6.6 million as of
December 31, 2021 to RMB3.3 million as of December 31, 2022, and then increased to
RMB14.4 million as of December 31, 2023.
FINANCIAL INFORMATION
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The table below sets forth our trade payables turnover days for the years indicated:
Y ears Ended December 31,
2021 2022 2023
Trade payables turnover days* 6 6 7
Note:
* Trade payables turnover days for a year is the arithmetic mean of the beginning and ending balances of
trade payables for the relevant year divided by the cost of revenue for the relevant year divided by 365
for each of 2021, 2022 and 2023.
During the Track Record Period, our trade payables turnover days remained stable at 6
days, 6 days and 7 days in 2021, 2022 and 2023, respectively. During the Track Record Period,
our trade payables turnover days were relatively short, especially in comparison with our trade
receivables turnover days, which was mainly due to the fact that we paid our major suppliers
in the form of prepayment and settled with them on a delivery upon receipt of payment basis,
as a way to maintain stable relationship therewith and also to get favorable procurement prices,
considering our stable liquidity and working capital position. According to the iResearch
Report, it is in line with industry norm to make such prepayment to suppliers, while the trade
payables turnover days of different companies can vary considerably because of the specific
types of projects carried out.
An ageing analysis of our trade payables as of the dates indicated, based on the invoice
date, is as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Within 6 months 5,697 674 13,806
After 6 months but within 1 year 5 552 477
Over 1 year 933 2,080 119
6,635 3,306 14,402
As of the Latest Practicable Date, RMB13.3 million, accounting for approximately 92.4%
of our trade payables as of December 31, 2023, had been subsequently settled.
FINANCIAL INFORMATION
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Other Payables
During the Track Record Period, our other payables primarily consisted of accrued
payroll and benefits, capital contribution from an investor representing amount received
therefrom for which the financing had not been completed as of December 31, 2022 and thus
accrued as liabilities, consideration payable for Jinxun Digital Intelligence acquisition, payable
for acquisition of property and equipment, payable for acquisition of service, and accrual
listing expenses. Our other payables increased from RMB39.9 million as of December 31, 2021
to RMB56.1 million as of December 31, 2022, primarily due to payables in relation to our
reception of the aforementioned capital contribution from an investor. Our other payables
decreased from RMB56.1 million as of December 31, 2022 to RMB29.0 million as of
December 31, 2023, primarily due to the decrease of the aforementioned payable for
acquisition of service and capital contribution from an investor from RMB11.3 million and
RMB16.8 million as of December 31, 2022, respectively, to RMB0.2 million and nil as of
December 31, 2023, respectively, offsetting the increase in accrual listing expenses mainly
related to the Listing and the Global Offering.
As of the Latest Practicable Date, RMB18.3 million, accounting for approximately 63.3%
of our other payables as of December 31, 2023, had been subsequently settled.
Contract Liabilities
Our contract liabilities mainly arise from the non-refundable advance payments made by
customers while the underlying services are yet to be provided. Our contract liabilities
increased significantly from RMB26.7 million as of December 31, 2021 to RMB31.1 million
as of December 31, 2022, and further to RMB97.4 million as of December 31, 2023, which was
in line with the expansion of our solution offerings and demonstrated our strengthened
relationship with our major customers. For details, see Note 23 to the Accountants’ Report in
Appendix I to this prospectus.
As of the Latest Practicable Date, RMB55.2 million, accounting for approximately 56.6%
of our contract liabilities as of December 31, 2023, had been subsequently recognized as
revenue.
FINANCIAL INFORMATION
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Redeemable Capital Contributions
During the Track Record Period, the redeemable capital contributions were primarily
related to the equity investments made by the relevant investors, including Series A Financing
in 2020, Series B Financing in 2021, Series B+ Financing in 2022 and Series C Financing in
2023. For details of our financing, see “History, Development and Corporate Structure –
Corporate Development” in this prospectus. Due to the redemption rights and liquidation
preferences in relation to such equity investments, we recognized the aforementioned financial
instruments issued to the relevant investors as financial liabilities. We expect to substantially
improve our net position and net current position upon completion of the Listing and the Global
Offering, as carrying amount of such redeemable capital contributions will be reclassified from
financial liabilities to equity as a result of the termination of the aforesaid preferred rights. Any
changes in the carrying amount of the financial liabilities were recorded in “changes in
carrying amount of redeemable capital contributions”. The redeemable capital contributions
increased significantly from RMB265.7 million as of December 31, 2021 to RMB528.0 million
as of December 31, 2022, and further to RMB852.9 million as of December 31, 2023, primarily
due to the continuous increase in carrying amount from the existing series of financing
recognized and/or redeemable capital contributions arising from subsequent series. For details
of the redeemable capital contributions, see Note 26 to the Accountants’ Report in Appendix
I to this prospectus.
The following table sets forth movement of the redeemable capital contributions:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At beginning of the year 99,316 265,666 527,970
Changes in carrying amount of
redeemable capital contributions 25,950 157,504 146,892
Issuance for cash 140,400 104,800 178,050
At ending of the year 265,666 527,970 852,912
FINANCIAL INFORMATION
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LIQUIDITY AND CAPITAL RESOURCES
Cash Flows
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cash generated from operations before
movements in working capital 99,664 127,678 215,526
Changes in working capital (158,414) (150,912) (282,141)
Tax paid (16,328) (7,880) (1,454)
Net cash used in operating activities (75,078) (31,114) (68,069)
Net cash used in investing activities (108,142) (140,677) (184,386)
Net cash generated from financing
activities 186,719 181,584 278,897
Net increase in cash 3,499 9,793 26,442
Cash at beginning of the year 7,142 10,641 20,434
Cash at end of the year 10,641 20,434 46,876
Net Cash Used in Operating Activities
In 2023, our net cash used in operating activities was RMB68.1 million, which was
primarily attributable to our loss before taxation of RMB28.8 million, adjusted for non-cash
and non-operating items. Positive adjustments for non-cash and non-operating items primarily
included (i) changes in the carrying amount of redeemable capital contributions of RMB146.9
million; (ii) impairment loss on trade receivables of RMB55.4 million; and (iii) amortization
of RMB24.6 million. The amount was then adjusted by changes in working capital, with
negative adjustments primarily including (i) an increase in prepayments of RMB116.1 million;
and (ii) an increase in trade and other receivables of RMB323.1 million.
FINANCIAL INFORMATION
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In 2022, our net cash used in operating activities was RMB31.1 million, which was
primarily attributable to our loss before taxation of RMB90.9 million, adjusted for non-cash
and non-operating items. Positive adjustments for non-cash and non-operating items primarily
included (i) changes in the carrying amount of redeemable capital contributions of RMB157.5
million; (ii) impairment loss on trade receivables of RMB42.6 million; (iii) amortization of
RMB14.1 million; and (iv) finance costs of RMB9.1 million. The amount was then adjusted by
changes in working capital, with negative adjustments primarily including (i) an increase in
trade and other receivables of RMB131.6 million; and (ii) an increase in prepayments of
RMB43.9 million.
In 2021, our net cash used in operating activities was RMB75.1 million, which was
primarily attributable to our profit before taxation of RMB44.4 million, adjusted for non-cash
and non-operating items. Positive adjustments for non-cash and non-operating items primarily
included (i) changes in the carrying amount of redeemable capital contributions of RMB26.0
million; (ii) impairment loss on trade receivables of RMB17.4 million; and (iii) finance costs
of RMB8.2 million. The amount was then adjusted by changes in working capital, with
negative adjustments primarily including (i) an increase in trade and other receivables of
RMB155.6 million; and (ii) an increase in prepayments of RMB24.9 million.
For details of our increasing trade receivables during the Track Record Period and the
impairment loss made thereon, see “– Discussion on Selected Items from Consolidated
Statements of Financial Position – Trade and Other Receivables – Trade Receivables” in this
section.
We plan to enhance our working capital management efficiency to improve our net
operating cash outflow position. For instance, we expect to collect our trade receivables in a
more efficient manner and have implemented relevant measures, such as by continually
monitoring the credit profiles and operating and financial conditions of our customers, and
proactively following up on our customers to ensure their payments as scheduled. For details
of our policies and measures to manage our trade receivables, see “– Discussion of Selected
Items from Consolidated Statements of Financial Position – Trade and Other Receivables –
Trade Receivables” in this section. In addition, as we continuously build trust with our
customers and gain more bargaining power through our business growth, we are able to
negotiate for shorter credit terms with our customers. In the future, we plan to develop
relationships with more customers of stronger credit profiles. Besides, we also expect to be
able to gradually enjoy economics of scale in the course of our business expansion, which will
further improve our net operating cash outflow position. Specifically, as we scale up, we expect
to have stronger bargaining power against our suppliers and are thus able to obtain more
favorable credit terms. Furthermore, We expect to improve our margin level over time as we
drive operational efficiencies, so as to achieve significant economies of scale that will
contribute to enhanced operating cash flows.
FINANCIAL INFORMATION
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Net Cash Used in Investing Activities
In 2023, our net cash used in investing activities was RMB184.4 million, primarily as a
result of (i) payment for the acquisition of property and equipment of RMB151.1 million; and
(ii) payment for the acquisition of intangible assets of RMB31.8 million.
In 2022, our net cash used in investing activities was RMB140.7 million, primarily as a
result of (i) payment for the acquisition of intangible assets of RMB102.6 million; (ii) payment
for the acquisition of property and equipment of RMB19.8 million; and (iii) acquisition of
subsidiary, net of cash acquired of RMB16.8 million.
In 2021, our net cash used in investing activities was RMB108.1 million, primarily as a
result of (i) payment for the acquisition of property and equipment of RMB56.6 million; (ii)
acquisition of a subsidiary, net of cash acquired of RMB20.4 million; and (iii) payment for
investment in financial assets measured at fair value through profit or loss of RMB20.0 million.
Net Cash Generated from Financing Activities
In 2023, our net cash generated from financing activities was RMB278.9 million,
primarily as a result of (i) proceeds from bank loans and other borrowings of RMB312.0
million; and (ii) proceeds from redeemable capital contributions of RMB161.3 million,
partially offset by repayment of bank loans and other borrowings of RMB181.7 million.
In 2022, our net cash generated from financing activities was RMB181.6 million,
primarily as a result of (i) proceeds from bank loans and other borrowings of RMB193.7
million; and (ii) proceeds from redeemable capital contributions of RMB104.8 million,
partially offset by repayment of bank loans and other borrowings of RMB122.7 million.
In 2021, our net cash generated from financing activities was RMB186.7 million,
primarily as a result of (i) proceeds from bank loans and other borrowings of RMB147.2
million; and (ii) proceeds from redeemable capital contributions of RMB140.4 million,
partially offset by repayment of bank loans and other borrowings of RMB94.5 million.
WORKING CAPITAL SUFFICIENCY
During the Track Record Period, we financed our operations primarily through cash
generated from our operating activities and bank borrowings as our principal sources of
funding, and our primary uses of cash were to fund our capital expenditures and working
capital. Going forward, we believe that our liquidity requirements will be satisfied with a
combination of cash flows generated from our operating activities and net proceeds from the
Global Offering. As of December 31, 2023, we had cash of RMB46.9 million.
FINANCIAL INFORMATION
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Sufficient working capital is essential to our ability to successfully execute our growth
strategies, and thus to enhance our business sustainability. To ensure working capital
sufficiency, we plan to enhance our working capital management efficiency, improve our
management of trade receivables and increase the focus on trade receivable collection, as well
as to maintain appropriate inventory and prepayment levels in relation to the required
procurement for offering software plus hardware solutions that meet the market demand. Our
Directors will continue to closely monitor the capital and liquidity requirements and ensure the
sufficiency of our working capital. Specifically, we have adopted the following measures to
manage our working capital and improve liquidity, including that: (i) we will prepare periodical
working capital forecasts in a timely manner that shall set out the expected cash inflows and
outflows on a monthly basis which our Directors will review together with cash flow
statements to enable us to better manage our liquidity resources in the near term; (ii) we will
prepare monthly management accounts in a timely manner, which will be reviewed by our
Directors and senior management and compared with our budgets. Any material variances will
be explained and followed up immediately; (iii) we will continue to actively monitor the
payment status of projects and customers, including conducting regular reviews of the relevant
accounts. Our finance department will also prepare an ageing analysis on a monthly basis for
the review by our Directors to ascertain if there are any long outstanding receivables; and (iv)
we will continue to closely monitor our cash and bank balance through constantly reviewing
our internal records and bank accounts. When any potential shortfall in our cash position is
identified, we will strive to negotiate for earlier settlement with our customers and/or request
a longer credit period from our suppliers in order to mitigate the cash flow mismatch. If
required, we may also obtain short-term bank borrowings to fund our capital needs. For details
of our policies and measures to manage our trade receivables, see “– Discussion of Selected
Items from Consolidated Statements of Financial Position – Trade and Other Receivables –
Trade Receivables” in this section.
Taking into account the financial resources available to us, including cash flow from
operating activities, our current cash, proceeds from the Pre-IPO Investments and the estimated
net proceeds from the Global Offering, our Directors are of the view that we have available
sufficient working capital to meet our present requirements, which is for at least the next 12
months from the date of this prospectus. Our relatively long trade receivables turnover days
during the Track Record Period admittedly expose us to liquidity risk. Such risk would
especially be more pronounced if the financial condition of enterprises or entities from the
public sector, to whom our solutions were substantially offered during the Track Record
Period, would deteriorate in the case of a combination of factors such as local governments’
significant debt obligations and diminished tax and other revenues, as well as uncertain
availability of financing vehicles therefor. If such factors would ever and indeed materialize,
a double squeeze of much higher write-off of trade receivables and slower cash inflows could
quickly and significantly strain our working capital in the short term, which might bring
various challenges to our business operations, including: (i) sizeable cash flow gaps that might
necessitate expensive bridge financing; (ii) cost overruns on existing projects and inability to
fund upfront costs of implementing new projects; (iii) workforce shrinkage impacting our
service capabilities; (iv) defaults in debt repayments and inability to obtain new borrowings;
and (v) loss of credibility with customers, suppliers, lenders and other partners in a vicious
FINANCIAL INFORMATION
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cycle that would ultimately threaten our solvency. For details, see “Risk Factors – Key Risks
Relating to Our Business, Industry, Regulatory Compliance, General Operations and Financial
Prospects – We are subject to credit risk related to defaults of customers as our trade
receivables balance and trade receivables turnover days increased significantly during the
Track Record Period, and any significant delay in payment or default on our trade receivables
could materially and adversely affect our liquidity, working capital, financial condition and
results of operations” in this prospectus.
INDEBTEDNESS
During the Track Record Period, our indebtedness mainly included bank loans and other
borrowings, lease liabilities, redeemable capital contributions, and loans from related parties.
The following table sets forth the components of our indebtedness as of the dates indicated:
As of December 31,
As of
April 30,
2021 2022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Current
Bank loans and other borrowings 150,663 211,650 342,000 434,840
Lease liabilities 2,302 4,128 8,115 9,189
Redeemable capital contributions 265,666 527,970 852,912 885,115
Loans from related parties 5,349 – – –
Non-current
Bank loans and other borrowings – 10,000 10,000 10,000
Lease liabilities 6,614 8,589 10,684 8,456
430,594 762,337 1,223,711 1,347,600
Loans From Related Parties
For details of our loans from related parties, see “Discussion of Selected Items From
Consolidated Statements of Financial Position – Trade and Other Payables” in this section.
FINANCIAL INFORMATION
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Bank Loans and Other Borrowings
We had bank loans and other borrowings of RMB150.7 million as of December 31, 2021,
RMB221.7 million as of December 31, 2022, RMB352.0 million as of December 31, 2023 and
RMB444.8 million as of April 30, 2024, being the indebtedness date for the purpose of the
indebtedness statement. Based on the rapid growth in demand in our solutions and our
increased operating scale, we proactively sought funding resources and incurred an increasing
amount of bank loans and other borrowings during the Track Record Period, primarily to
finance our working capital requirements and capital expenditures to meet the potential growth
in demand and to expand our business. As of April 30, 2024, our unutilized bank facilities
amounted to RMB1.2 million. The following table sets forth our bank loans and other
borrowings as of the dates indicated:
As of December 31,
As of
April 30,
2021 2022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Current
Bank loans
– Unsecured and unguaranteed 10,000 10,000 30,000 40,000
– Secured and guaranteed* 118,000 201,650 312,000 394,840
– Pledged and unguaranteed 10,500 – – –
138,500 211,650 342,000 434,840
Other borrowings
– Secured and guaranteed 3,063 – – –
– Pledged and guaranteed 9,100 – – –
12,163 – – –
150,663 211,650 342,000 434,840
FINANCIAL INFORMATION
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As of December 31,
As of
April 30,
2021 2022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Non-current
Bank loans
– Secured and guaranteed* – 10,000 10,000 10,000
– 10,000 10,000 10,000
Total 150,663 221,650 352,000 444,840
Note:
* The outstanding guarantee of bank loans will be released before the Listing.
Our bank borrowings agreements contain standard terms, conditions and covenants that
are customary for commercial bank loans. Our Directors confirmed that as of the Latest
Practicable Date, the agreements under our borrowings did not contain any covenant that would
have a material adverse effect on our ability to make additional borrowings or issue debt or
equity securities in the future. Our Directors further confirmed that we had no defaults in bank
and other borrowings, nor did we breach any covenants (that were not waived) during the Track
Record Period and up to the Latest Practicable Date. Our Directors further confirmed that
during the Track Record Period and up to the Latest Practicable Date, we did not experience
any material difficulties in obtaining credit facilities, withdrawal of facilities or requests for
early repayment. For details, see Note 24 to the Accountants’ Report in Appendix I to this
prospectus.
Lease Liabilities
As of December 31, 2021, 2022 and 2023 and April 30, 2024, we recorded lease liabilities
of RMB8.9 million, RMB12.7 million, RMB18.8 million and RMB17.6 million, respectively,
which was primarily in relation to the properties we leased for our operation premises. For
details, see Note 25 to the Accountants’ Report in Appendix I to this prospectus.
Redeemable Capital Contributions
For details of our redeemable capital contributions, see “Discussion of Selected Items
From Consolidated Statements of Financial Position – Redeemable Capital Contributions” in
this section.
FINANCIAL INFORMATION
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Except as disclosed above, we did not have any material mortgages, charges, debentures,
loan capital, debt securities, loans, bank overdrafts or other similar 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 or other contingent liabilities as of April 30, 2024. Since April 30, 2024 and up to
the Latest Practicable Date, there had not been any material change to our indebtedness.
CAPITAL EXPENDITURE
We regularly incur capital expenditures to purchase our property and equipment, as well
as intangible assets, in order to enhance our research and development and commercialization
capabilities, and expand our business operations. The following table sets forth our capital
expenditure for the years indicated:
Y ear Ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Payment for the acquisition of property
and equipment 56,579 19,810 151,112
Payment for the acquisition of
intangible assets 13,093 102,593 31,802
69,672 122,403 182,914
We plan to finance our future capital expenditure through cash generated from our
operations, our existing bank borrowings and the net proceeds from the Global Offering. Our
current capital expenditure plans for any future period are subject to change, and we may adjust
our capital expenditure according to our future cash flows, our results of operations and
financial condition, our business plans, market conditions and various other factors we believe
to be appropriate. For details, see “Future Plans and Use of Proceeds – Use of Proceeds” in this
prospectus.
CONTRACTUAL OBLIGATIONS
Commitments
As of December 31, 2021, 2022 and 2023, we had commitments of RMB444.1 million,
RMB359.6 million and RMB275.6 million, primarily related to purchase of network resources
from a major telecommunications company in China, in order to improve our service
FINANCIAL INFORMATION
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capabilities and further strengthen our solution offerings in city management and
administration projects. For details, see “Business – Suppliers and Procurement – Top
Suppliers” in this prospectus. The following table sets forth our commitments as of the dates
indicated:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Purchase of network and other
telecommunication resource costs 424,246 291,400 180,306
Purchase of property, equipment and
intangible assets 19,833 68,236 95,300
444,079 359,636 275,606
CONTINGENT LIABILITIES
As of December 31, 2021, 2022 and 2023, we did not have any material contingent
liabilities.
OFF-BALANCE SHEET COMMITMENTS AND ARRANGEMENTS
As of the Latest Practicable Date, we had not entered into any off-balance sheet
transactions.
KEY FINANCIAL RATIOS
The table below sets forth our key financial ratios for the years indicated:
Y ear Ended December 31,
2021 2022 2023
%%%
Gross profit margin (1) 33.1 39.1 40.0
Adjusted net margin
(a non-IFRS measure) (2) 13.6 13.9 14.5
Notes:
(1) Gross profit margin equals gross profit divided by revenue for the year and multiplied by 100%.
(2) Adjusted net margin (a non-IFRS measure) equals adjusted net profit (a non-IFRS measure) divided by
revenue for the year and multiplied by 100%.
FINANCIAL INFORMATION
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For details, see “– Description of Selected Components of Consolidated Statements of
Profit or Loss” and “– Period to Period Comparison of Results of Operations” in this section.
RELATED PARTY TRANSACTIONS AND BALANCES
We enter into transactions with our related parties from time to time. Our Directors are
of the view that each of the related party transactions set out in Note 33 to the Accountants’
Report included in Appendix I to this prospectus was conducted in the ordinary course of
business on an arm’s-length basis and with normal commercial terms between the relevant
parties. Our Directors are also of the view that our related party transactions during the Track
Record Period would not distort our track record results or cause our historical results to
become non-reflective of our future performance. Our balances with related parties as of
December 31, 2023 are set out in Note 33 to the Accountants’ Report in Appendix I to this
prospectus.
RISK DISCLOSURES
We are exposed to a variety of financial risks, including credit risk, liquidity risk, interest
rate risk and currency risk. Our overall risk management program focuses on the
unpredictability of financial markets and seeks to minimize potential adverse effects on our
financial performance. For more details, see Note 30 to the Accountants’ Report in Appendix
I to this prospectus. As of the Latest Practicable Date, we did not hedge or consider necessary
to hedge any of these risks.
Credit Risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations
resulting in a financial loss to us. Our credit risk is primarily attributable to trade receivables
and other receivables. Our exposure to credit risk arising from cash are limited because the
counterparties are reputable banks or financial institution, which we consider to present low
credit risks. Our exposure to credit risk arising from refundable rental deposits is considered
to be low, taking into account (i) the landlords’ credit rating; and (ii) the remaining lease term
and the period covered by the rental deposits. Our management has a credit policy in place and
the exposure to credit risk is monitored on an ongoing basis.
Our exposure to credit risk arising from trade receivables is influenced mainly by the
individual characteristics of each customer. The default risk of the industry or country in which
the customers operate also has an influence on credit risk. Individual credit evaluations are
performed on all customers requiring credit over a certain amount. These evaluations focus on
the customer’s past history of making payments when due and current ability to pay, taking into
account information specific to the customer as well as pertaining to the economic environment
in which the customer operates.
FINANCIAL INFORMATION
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--- page 478 ---
We measure loss allowances for trade receivables at lifetime ECL. We determine ECL by
using a provision matrix, estimated based on historical credit loss experience, the past default
experience of the debtor, general economic conditions of the industry and country in which the
debtors operate and an assessment of both the current and the forecast duration of condition as
of December 31, 2021, 2022 and 2023. As our historical credit loss experience does not
indicate significantly different loss patterns for different customer segments, the loss allowance
based on past due status is not further distinguished among our different customer bases. As
of December 31, 2021, 2022 and 2023, our loss allowance on trade receivables amounted to
RMB32.4 million, RMB66.5 million and RMB121.9 million, respectively.
In 2021, 2022 and 2023, our write-off of trade receivables amounted to nil, RMB8.5
million and nil, respectively. The write-off that we made in 2022 was in relation to our trade
receivables accrued before the Track Record Period that had been past due for more than three
years, after our multiple efforts to collect payment to no avail. Considering that we would not
continue to sell to the customers involved going forward, our management decided to write off
such trade receivables. During the Track Record Period, we did not recognize any revenue from
the customers the trade receivables from whom had been written off. As of December 31, 2023
and the Latest Practicable Date, the amounts of our outstanding trade receivables from such
customers were nil.
Liquidity Risk
Our management are responsible for their own cash management, including the
short-term investment of cash surpluses and the raising of loans to cover expected cash
demands, subject to approval by the parent company’s board when the borrowings exceed
certain predetermined levels of authority. Our policy is to regularly monitor our liquidity
requirements and our compliance with lending covenants, to ensure that we maintain sufficient
reserves of cash and readily realizable marketable securities and adequate committed lines of
funding from major financial institutions to meet our liquidity requirements in the short and
longer term.
Interest Rate Risk
Our interest-bearing financial instruments at variable rates are the cash at bank as of
December 31, 2021, 2022 and 2023. Our interest-bearing financial instruments at fixed interest
rates are loans and borrowings as of December 31, 2021, 2022 and 2023 that are measured at
amortized cost.
Our income and operating cash flows are substantially independent of exchanges in
market interest rates and we have no significant interest-bearing assets except for cash.
FINANCIAL INFORMATION
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Currency Risk
As of December 31, 2021, 2022 and 2023, we are not exposed to significant foreign
currency risk since financial assets and liabilities denominated in currencies other than the
functional currencies of our Company and our subsidiaries are not significant.
DIVIDEND
No dividends were paid or declared by our Company or any of our subsidiaries during the
Track Record Period. After completion of the Global Offering, we may distribute dividends in
the form of cash or by other means permitted by our Articles of Association. Any proposed
distribution of dividends shall be formulated by our Board and will be subject to approval of
our Shareholders. A decision to declare or to pay any dividends in the future, and the amount
of any dividend, will depend upon a number of factors, including our earnings and financial
condition, operating requirements, capital requirements, business prospects, statutory,
regulatory and contractual restrictions on our declaration and payment of dividends, and any
other factors that our Directors may consider important.
According to the PRC Company Law , a PRC incorporated company is required to set
aside at least 10% of its after-tax profits each year, after making up previous years’
accumulated losses, if any, to contribute to certain statutory reserve funds until the aggregate
amount contributed to such funds reaches 50% of its registered capital. Such company may pay
dividends out of after-tax profits after making up for accumulated losses and contributing to
statutory reserve funds as mentioned above. As advised by our PRC Legal Adviser, our
Company cannot pay dividends if it is in an accumulated loss position.
There is no assurance that dividends of any amount will be declared or be distributed in
any year. Currently, we do not intend to adopt a formal dividend policy or a fixed dividend
distribution ratio following the Global Offering.
PRC laws require that dividends be paid only out of the profit for the year calculated
according to PRC accounting principles, which differ in many aspects from the generally
accepted accounting principles in other jurisdiction, including the IFRS. According to the
applicable PRC laws and our Articles of Association, we will pay dividends out of our profit
after tax only after we have made the following allocations:
 recovery of the losses incurred in the previous year;
 allocations to the statutory common reserve equivalent to 10% of our profit after tax
until such reserve has reached more than 50% of our registered capital; and
 allocation to a discretionary common reserve of our profit after tax that are approved
by a shareholders’ meeting.
FINANCIAL INFORMATION
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We will therefore only be able to declare dividends after (i) all our historically
accumulated losses have been made up for; and (ii) we have allocated sufficient net profit to
our statutory common reserve fund as described above.
DISTRIBUTABLE RESERVES
As of December 31, 2023, we did not have any distributable reserves.
LISTING EXPENSE
During the Track Record Period, we incurred listing expenses of RMB4.6 million
(HK$5.0 million) and RMB15.9 million (HK$17.5 million) charged to administrative and other
operating expenses in our statements of profit or loss in 2022 and 2023, respectively.
Listing expenses to be borne by us are estimated to be approximately RMB84.2 million
(HK$92.4 million), at the Offer Price of HK$152.10 per Offer Share, and assuming the
Over-allotment Option is not exercised, among which (i) underwriting-related expenses,
including underwriting commission and other expenses are approximately RMB33.3 million
(HK$36.6 million); and (ii) non-underwriting-related expenses are approximately RMB50.9
million (HK$55.8 million), comprising (a) fees and expenses of legal advisors and accountants
of approximately RMB26.9 million (HK$29.5 million); and (b) other fees and expenses of
approximately RMB24.0 million (HK$26.3 million). As of December 31, 2023, we incurred a
total of RMB24.1 million (HK$26.4 million) in listing expenses, among which RMB20.5
million (HK$22.5 million) was recognized in our statements of profit or loss, and RMB3.6
million (HK$3.9 million) is expected to be deducted from equity. We estimate that we will
further incur listing expenses of RMB60.1 million (HK$66.0 million), of which RMB20.7
million (HK$22.7 million) will be recognized in our statements of profit or loss, and RMB39.4
million (HK$43.3 million) will be deducted from equity. Our listing expenses as a percentage
of gross proceeds from the Global Offering will be 13.9%, assuming an Offer Price of
HK$152.10 per Offer Share and that the Over-allotment Option is not exercised. The listing
expenses above are the latest practicable estimate for reference only, and the actual amount
may differ from this estimate.
UNAUDITED PRO FORMA ADJUSTED NET TANGIBLE ASSETS
The following statement of unaudited pro forma adjusted net tangible assets of our Group
is prepared in accordance with Rule 4.29 of the Listing Rules and is set out below for the
purpose to illustrate the effect of the Global Offering on the consolidated net tangible liabilities
attributable to equity shareholders of our Company as of December 31, 2023 as if it had taken
place on December 31, 2023.
The statement of unaudited pro forma adjusted net tangible assets has been prepared for
illustrative purposes only and because of its hypothetical nature, it may not give a true picture
of the financial position of our Group had the Global Offering been completed as of
December 31, 2023 or any future date.
FINANCIAL INFORMATION
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Consolidated net
tangible liabilities
attributable to the
equity shareholders
of our Company as
of December 31,
2023 (1)
Estimated net
proceeds from this
Global
Offering (2)(5)
Estimated impact
upon the
derecognition of
redeemable capital
contributions (3)
Unaudited pro
forma adjusted net
tangible assets
attributable to the
equity shareholders
of our Company (6)
Unaudited pro
forma adjusted net
tangible assets
attributable to the
equity shareholders
of our Company
per Share (4)
RMB’000 RMB’000 RMB’000 RMB’000 RMB (4) HK$(5)
Based on an Offer Price of
HK$152.10 per Share (154,823) 541,848 852,912 1,239,937 35.00 38.38
Notes:
(1) The consolidated net tangible liabilities attributable to the equity shareholders of our Company as of
December 31, 2023 is calculated based on the audited consolidated total deficit attributable to the equity
shareholders of our Company as of December 31, 2023 of RMB11,683,000 extracted from the Accountants’
Report set out in Appendix I to this prospectus, after deduction of intangible assets attributable to the equity
shareholders of our Company of RMB103,972,000 and goodwill of RMB39,168,000.
(2) The estimated net proceeds from this Global Offering are based on the expected issuance of 4,365,660 H shares
and the indicative Offer Prices of HK$152.10, after deduction of the estimated underwriting fees and other
estimated related expenses payable by our Group (excluding listing expenses of RMB20,509,000 which have
been expensed prior to December 31, 2023) and does not take into account of any shares which may be issued
upon the exercise of the Over-allotment Option.
(3) The carrying amount of redeemable capital contributions was RMB852,912,000 as of December 31, 2023 (as
set out in Note 26 to the Historical Financial Information included in the Accountant’s Report in Appendix I
to this prospectus). Upon the Listing and completion of the Global Offering, special rights attributable to the
investors of the redeemable capital contributions will be removed, and these redeemable capital contributions
will be derecognized as liabilities and transferred to equity.
(4) The unaudited pro forma adjusted net tangible assets attributable to equity shareholders of our Company per
Share is arrived at after adjustments on the basis that 35,424,890 Shares were in issue assuming that the Global
Offering had been completed on December 31, 2023 without taking into account of the Shares that may be
issued upon exercise of the Over-allotment Option.
(5) For illustrative purpose, the estimated net proceeds from the Global Offering is converted from the Hong Kong
Dollar into Renminbi and the unaudited pro forma adjusted net tangible assets attributable to the equity
shareholders of our Company per Share is converted from Renminbi into Hong Kong Dollar at the exchange
rate of HK$1 to RMB0.9120, the exchange rate set by PBOC prevailing on June 20, 2024. No representation
is made that the Hong Kong Dollars amounts have been, could have been or may be converted to Renminbi,
or vice versa, at that rate.
(6) No adjustment has been made to the unaudited pro forma adjusted net tangible assets attributable to equity
shareholder of our Company to reflect any trading results or other transactions entered into subsequent to
December 31, 2023.
FINANCIAL INFORMATION
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--- page 482 ---
NO MATERIAL ADVERSE CHANGE
Our Directors confirmed that, up to the date of this prospectus, there had been no material
adverse change in our financial or operational prospects since December 31, 2023, being the
latest balance sheet date of our consolidated financial statements in the Accountants’ in
Appendix I to this prospectus.
DISCLOSURE UNDER RULES 13.13 TO 13.19 OF THE LISTING RULES
Our Directors confirmed that, as of the Latest Practicable Date, there was no circumstance
that would give rise to a disclosure requirement under Rules 13.13 to 13.19 of the Listing
Rules.
FINANCIAL INFORMATION
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--- page 483 ---
FUTURE PLANS
For details of a description of our future plans, see “Business – Our Strategies” in this
prospectus.
USE OF PROCEEDS
At an Offer Price of HK$152.10 per Offer Share, we estimate that we will receive net
proceeds of approximately HK$571.6 million from the Global Offering after deducting the
underwriting commissions and other estimated expenses paid and payable by us in connection
with the Global Offering and assuming that the Over-allotment Option is not exercised.
We currently intend to use the net proceeds we expect to receive from the Global Offering
for the following purposes and in the amounts set out below.
 Approximately 60.0%, or HK$343.0 million, will be used to enhance the
fundamental research on our key technologies, improve the development of our
standardized solutions and iteratively launch diverse commercialization applications
and functions for more business scenarios. We plan to further apportion the use of
such net proceeds as follows.
➢ Approximately 30.0%, or HK$171.5 million, will be used to strengthen our
research and development team, including:
(i) approximately 23.0%, or HK$131.5 million, will be allocated for our
research and development team on further explorations into our key
technological areas, so as to strengthen our competitiveness over existing
and emerging enterprise-level conversational AI solution providers, and
maintain our competitiveness and innovativeness of our conversational
AI technologies. Specifically,
(1) approximately 10.0%, or HK$57.2 million, will be used for
reinforcement learning, transfer learning and federated learning
technologies. We will continue our fundamental AI technological
explorations under the self-supervised learning framework to further
reduce the dependence of AI algorithms training on the amount of
data and significantly enhance the generalization ability of our
algorithms. These technologies will further enhance the ability of
our solutions to be applied across different application scenarios,
thereby reducing our costs of expansion into new use cases and
end-customer industries;
FUTURE PLANS AND USE OF PROCEEDS
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--- page 484 ---
(2) approximately 10.0%, or HK$57.2 million, will be used for
technologies related to visualizable conversational AI empowered
by computer vision AI. We will endeavor to strengthen our
technological accumulations in visualizable conversational AI that
is further empowered by computer vision AI technologies, in order
to launch, for instance, conversational AI-enabled digital avatars
that can be applied in not only customer service scenarios, but also
in wider areas that have demand for more vivid and engaging
conversational interaction experiences;
(3) approximately 3.0%, or HK$17.1 million, will be used for
technologies related to next-generation unified communications
compatible with visualizable conversational AI. We will continue
our research into unified communication technologies for signal
processing and intelligent integration with respect to video calls
made via the original calling interface compatible with the networks
of each major telecommunications company in China, which we
believe are likely to achieve a new enterprise-level interactive mode
and have broad applicability in various scenarios where video-based
conversations will provide better user experiences and improve
customer services;
We had demonstrated promising prospects for stable profitability with
accessible research and development expenses during the Track Record
Period, leveraging the high standardization of our solutions based upon
our mature technological and know-how precipitation in the area for
decades. The aforementioned key technological development projects,
however, feature higher technological thresholds where multiple
technological areas intersect. We believe that such projects represent the
future of underlying conversational AI technologies that we are
committed to purse, on which we will need to enlarge our spending to
expedite our technological accumulations so as to profit on our first-
mover advantages in the future. For details, see “Business – Our
Technologies – Key Technological Development Projects” in this
Prospectus.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 485 ---
(ii) approximately 7.0%, or HK$40.0 million, will be allocated for our
research and development team on the improvement of our standardized
solutions to enhance their functionalities as applied in various application
scenarios of different end-customer industries, which we believe will help
improve our competitiveness in the enterprise-level conversational AI
market characterized by increasingly intensifying competitions. For
example, with the expansion of our business footprints both domestically
and globally, we plan to continue to strengthen our capabilities of
processing and analyzing conversations involving an increasing number
of linguistical contexts, ranging from Chinese dialects to foreign
languages.
To achieve the plans above, we plan to (i) recruit scientists, researchers,
architects and engineers with experience in unified communications, AI and
software development; and (ii) increase the compensation levels for our
present research and development staff.
To maintain our competitive edges and further innovate our solutions and
technologies, we plan to hire additional scientists, researchers, architects
and/or engineers with the net proceeds from the Global Offering over the next
three years upon the Listing. Qualified candidates are expected to include (i)
experienced laterals from renowned AI companies or academic institutes who
have published relevant papers on international journals or have extensive
experiences in the commercialization of AI technologies; and/or (ii)
outstanding and talented fresh graduates from leading universities. We believe
that qualified and experienced talents are crucial for sustaining our leadership
in the aforementioned key technologies and continuously upgrading our
algorithms and technological engines.
To effectively retain our R&D staff and prevent them from joining our
competitors, we intend to gradually increase the compensation levels for our
R&D staff to keep up with any increase in the industry level and maintain the
competitiveness of our compensation package. Specifically, we intend to
gradually increase their wages and benefits and implement share-based
incentives to motivate them by providing such persons with an opportunity of
sharing our business growth and future success. According to our current
recruitment plan, by the end of the said year, the compensation levels of our
R&D staff are expected to reach around RMB228 thousand per year,
representing an approximate 20.2% increase compared with that during the
Track Record Period.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 486 ---
➢ Approximately 30.0%, or HK$171.5 million, will be used to strengthen our
technological infrastructure and research and development capabilities.
Specifically,
(i) approximately 20.0%, or HK$114.3 million, will be allocated for the
procurement and installation of equipment, devices and/or software to
support our increasing business needs over the next three years upon the
Listing. Specifically, we were establishing an AI empowerment
computing center as of the Latest Practicable Date, which, equipped with
ample GPU resources, could cloudify the computing power and training
of AI models, in order to further enhance the capabilities of our AI
technologies. As the computing center can significantly empower the
efficiency of training our AI models, we are able to effectively improve
the performance of our solutions in various specific scenarios.
Accordingly, we plan to procure GPUs, advanced servers and other
hardware components such as network and other telecommunication
equipment and resources, as well as other accessory equipment, in order
to increase the total computing power and support training and production
of AI models. The table below sets forth the expected costs by each major
type of equipment/resource to be procured:
No. Equipment/Resource Expected Approximate Cost
1 Customized servers
(including GPUs)
RMB2,000 thousand/unit
2 Computer memories RMB1,000 thousand/unit
3 Bandwidths RMB30 per month/MB
4 Firewall RMB3,000 thousand/unit
5 Core switches RMB210 thousand/unit
The establishment of the computing center provides the infrastructure
support necessary for carrying out our future R&D endeavors, as we
continue to scale up our solution offerings. In addition to the historical
expenditures incurred during the Track Record Period, we expect to
further invest in this aspect in order to solidify our technologically
competitive position in the full-stack enterprise-level conversational AI
market in the long run. For details, see “Business – Our Technologies –
AI Technologies – AI Empowerment Computing Center” in this
prospectus;
(ii) approximately 10.0%, or HK$57.2 million, will be allocated on
technology development fees in relation to research and development
activities to be carried out under new research and development
centers/labs, among others. To further enhance our research and
FUTURE PLANS AND USE OF PROCEEDS
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--- page 487 ---
development capabilities and attract research and development talents,
we plan to establish a number of such research and development
centers/labs jointly with more reputed technology companies and
academic institutes. Under the management of our headquarter, these new
research and development centers/labs will work with us in jointly
conducting research and development activities that are informed by the
optimal industry experiences and customer insights, so as to develop
technological leading and commercially viable solutions. To the best
estimates of our Directors, we expect to establish approximately two to
three new research and development centers/labs with other technology
companies and academic institutes, respectively, in the near future and
the average technology development fees in association with each
research and development center/lab over the next three years upon the
Listing thus range around approximately RMB15 million, depending
upon the subject matter, complexity and depth, etc. of the collaboration.
For details of our exemplary external collaborations during the Track
Record Period, see “Business – Our Technologies – AI Technologies –
Technological Collaboration” and “Business – Research and
Development” in this prospectus.
 Approximately 20.0%, or HK$114.3 million, will be allocated to expand our
solution offerings, build our brand and enhance our commercialization capabilities.
By leveraging our go-to-market strategies and accumulated industry insights proven
to be successful in serving our four key end-customer industries, we plan to
accelerate our penetration into other industries such as the media, healthcare,
E-commerce and retailing, etc., in order to empower their intelligent transformation
and improve our industry coverage. We will conduct careful evaluation and analysis
on the expected market size, competitive landscape and potential challenges before
entering into other new end-customer industries. We plan to further apportion the
use of such net proceeds as follows.
➢ Approximately 8.0%, or HK$45.7 million, will be used to enhance our business
development efforts and increase market penetration. As an important way to
strengthen our sales and marketing capabilities, we plan to recruit and retain
diversely backgrounded professionals with rich industry and customer insights,
which we believe can help us capture the business needs of users and the pain
points of the industry to expand our user base and increase customer loyalty,
hence increasing the customers’ spending on our solutions. We plan to hire
additional sales and marketing staff over the next three to four years upon the
Listing to support our business growth and gradually improve the
compensation levels for our present sales and marketing staff, as well as to
implement share-based incentives.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 488 ---
➢ Approximately 12.0%, or HK$68.6 million, will be used to enhance our brand
awareness through various channels and develop relationships with industry
participants. We plan to promote our solutions by engaging in more marketing
activities through both offline and online channels, in order to build our brand.
Specifically,
(i) approximately 6.0%, or HK$34.3 million, will be used for brand
promotion and exposure, including organizing and sponsoring highly
influential industry events and other sales and marketing activities, over
the next three years upon the Listing;
(ii) approximately 6.0%, or HK$34.3 million, will be allocated for
collaborating with our eco-partners in other forms of marketing. We will
build an eco-collaboration department to promote our brand awareness
among our existing and potential customers and users.
 Approximately 10.0%, or HK$57.2 million, will be used to pursue domestic and
overseas strategic investment and acquisition opportunities, so as to implement our
long-term growth strategy to optimize our solutions and expand and penetrate the
end-customer industries that we cover. Specifically, we plan to select businesses (i)
with technologies that are complementary to our solutions in terms of improving our
cutting-edge conversational AI technologies and allowing us to comprehensively
optimize our deployment efficacy and the completeness of our solution offerings;
(ii) with proven market position, extensive know-how and stably maintained and
healthy financial track record in the end-customer industries where we have already
established strong presence and intend to further increase the penetration, and the
end-customer industries that we may expand into in the future; and/or (iii) with
promising overseas customer resources and conversational AI technological
capabilities.
As such, we may invest in leaders in the cutting-edge technologies that we are
focusing on and paying close attention to, providers focusing on solutions applied
to specific end-customer industries or sub-end-customer industries, and overseas
conversational AI enterprises with early-mover advantages. Leveraging such
potential strategic investments and acquisitions, we expect to achieve synergies
therewith in terms of optimizing our overall deployment efficacy, improving our
technological capabilities and solution offerings, enlarging our user base, and
enhancing and expanding our overseas presence, among others. We intend to make
such investments and acquisitions mainly through equity (controlling or
non-controlling) and may consider other forms of investment such as debt or that
with convertible features if such are better suited for the need of the transaction,
evaluated on a case-by-case basis. As of the Latest Practicable Date, we did not
identify any investment and acquisition target in this regard.
 Approximately 10.0%, or HK$57.2 million, will be used for general corporate
purposes.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 489 ---
If the Over-allotment Option is exercised in full, the additional net proceeds that we will
receive will be approximately HK$94.0 million at the Offer Price of HK$152.10 per Offer
Share. In the event that the Over-allotment Option is exercised in full, we intend to apply the
additional net proceeds to the above purpose on a pro rata basis.
To the extent that the net proceeds from the Global Offering are not immediately used for
the above purposes and to the extent permitted by applicable laws and regulations, we may hold
such funds in short-term interest-bearing accounts at other authorized financial institutions as
defined under the Securities and Futures Ordinance and/or licensed commercial banks so long
as it is deemed to be in the best interests of our Company. In such event, we will comply with
the appropriate disclosure requirements under the Listing Rules. In addition, there remains the
risk that our proceeds from the capital market or other open markets might not be sufficient for
our purposes planned above, and in such case, we would need additional capital to fund our
business expansion plans. See “Risk Factors – Risks Relating to Our Financial Position and
Need for Additional Capital – We had net loss for the year 2022 and 2023 and net cash flows
used in operating activities during the Track Record Period, and may need to obtain additional
financing to fund our operations, which may cause dilution to our Shareholders and restrict our
operations, and we may not be able to obtain additional financing on favorable terms or at all”
in this prospectus.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 490 ---
THE CORNERSTONE INVESTMENTS
We have entered into cornerstone investment agreements (each a “ Cornerstone
Investment Agreement ”, and together the “ Cornerstone Investment Agreements ”) with the
cornerstone investors set out below (each a “ Cornerstone Investor ”, and together the
“Cornerstone Investors ”), pursuant to which the Cornerstone Investors have agreed to,
subject to certain conditions, subscribe, or cause their designated entities to subscribe, at the
Offer Price for a certain number of Offer Shares (the “ Cornerstone Investments ”).
At the Offer Price of HK$152.10, the total number of Offer Shares to be subscribed for
by the Cornerstone Investors would be 1,798,640 Offer Shares (rounded down to the nearest
board lot of 20 H Shares), representing (i) approximately 41.2% of the Offer Shares pursuant
to the Global Offering (assuming the Over-allotment Option is not exercised; (ii)
approximately 5.1% of our total issued share capital immediately upon completion of the
Global Offering (assuming the Over-allotment Option is not exercised); and (iii) approximately
5.0% of our total issued share capital immediately upon completion of the Global Offering
(assuming the Over-allotment Option is exercised in full).
Our Company is of the view that, (i) the Cornerstone Investments will ensure a reasonable
size of solid commitment at the beginning of the marketing period of the Global Offering and
will provide confidence to the market; and (ii) given the background of the Cornerstone
Investors, the Cornerstone Investment will help raise the profile of our Company and to signify
that such investors have confidence in our business and prospect. The Cornerstone Investors
became acquainted with us through introduction by our Shareholder or its financial adviser.
The Cornerstone Investments will form part of the International Offering, and the
Cornerstone Investors will not subscribe for any Offer Shares under the Global Offering other
than pursuant to the Cornerstone Investment Agreements. The Offer Shares to be subscribed for
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 to be listed on the Stock
Exchange. The Offer Shares to be subscribed for by the Cornerstone Investors will be counted
towards the public float of our Company under Rule 8.08 of the Listing Rules.
Immediately following the completion of the Global Offering, (i) none of the Cornerstone
Investors will become a substantial Shareholder; (ii) none of the Cornerstone Investors will
have any Board representation in our Company, and (iii) equity interests in our Company being
beneficially owned by the three largest public Shareholders will be less than 50% of the
securities in public hands for the purpose of Rule 8.08(3) of the Listing Rules.
CORNERSTONE INVESTORS
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--- page 491 ---
To the best knowledge of our Company, (i) each of the Cornerstone Investors is an
independent third party and is independent of our Company, its connected persons and their
respective associates; (ii) none of the Cornerstone Investors is accustomed to take instructions
from our Company, the Directors, the Supervisors, chief executive of our Company,
Controlling Shareholders, substantial Shareholders or existing Shareholders or any of its
subsidiaries or their respective close associates; and (iii) none of the subscription for the
relevant Offer Shares by the Cornerstone Investors is financed by our Company, our
subsidiaries, the Directors, the Supervisors, chief executive of our Company, Controlling
Shareholders, substantial Shareholders or any of its subsidiaries or their respective close
associates.
As confirmed by each of the Cornerstone Investors, they made their own independent
decisions to enter into the Cornerstone Investment Agreements, and their subscriptions under
the Cornerstone Investment would be financed by their own internal resources. The
Cornerstone Investors have also confirmed that all necessary approvals have been obtained
with respect to the Cornerstone Investments and that no specific approval from any stock
exchange (if relevant) or their shareholders is required for the Cornerstone Investments. Other
than a guaranteed allocation of the relevant Offer Shares at the Offer Price, the Cornerstone
Investors do not have any preferential rights in the Cornerstone Investment Agreements
compared with other public Shareholders. Other than the Cornerstone Investment Agreements,
there are no side agreements or arrangements between us and the Cornerstone Investors in
relation to the Global Offering.
The total number of Offer Shares to be subscribed for by the Cornerstone Investors under
the Cornerstone Investment 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 the paragraphs headed “Structure of the
Global Offering – The Hong Kong Public Offering – Reallocation” in this prospectus. The
number of Offer Shares to be acquired by each Cornerstone Investor may be reduced on a pro
rata basis in accordance with the terms of the Cornerstone Investment Agreements to satisfy the
shortfall, after taking into account the requirements under Appendix F1 to the Listing Rules as
well as the discretion of the Sole Overall Coordinator (for itself and on behalf of the
International Underwriters) to exercise the Over-allotment Option. Details of the actual number
of Offer Shares to be allocated to each of the Cornerstone Investors will be disclosed in the
allotment results announcement to be issued by our Company on or around July 9, 2024.
Pursuant to the Cornerstone Investment Agreements, the Sole Overall Coordinator (for
itself and on behalf of the International Underwriters) has the discretion to effect a delayed
delivery of the Offer Shares to be subscribed for by each of the Cornerstone Investors on a date
later than the Listing Date, subject to the conditions contained therein. Such delayed delivery
arrangement is in place to facilitate the over-allocation in the International Offering. There will
be no delayed delivery if there is no over-allocation in the International Offering. The delayed
delivery arrangements relate only to the delay in the delivery of the Offer Shares to such
Cornerstone Investor on the condition that the Offer Price for the Offer Shares allocated to such
Cornerstone Investor will be fully paid before the Listing, and thus there will be no delayed
CORNERSTONE INVESTORS
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--- page 492 ---
settlement of payment no matter whether there is delayed delivery or not. For details of the
Over-allotment Option and the stabilization action by the Stabilizing Manager, please refer to
the paragraphs headed “Structure of the Global Offering – The International Offering –
Over-allotment Option” and “Structure of the Global Offering – The International Offering –
Stabilization” in this prospectus, respectively.
The table below sets out details of the Cornerstone Investment:
Based on the Offer Price of HK$152.1
Assuming the Over-allotment
Option is not exercised
Assuming the Over-allotment
Option is fully exercised
Cornerstone
Investor
Total investment
amount (Notes 1 & 2)
Number of
Offer Shares
to be
acquired (Note 3)
Approximate
% of the Offer
Shares
Approximate
% of the issued
share capital
following the
completion of
the Global
Offering
Approximate
% of the Offer
Shares
Approximate
% of the issued
share capital
following the
completion of
the Global
Offering
Jiangkong (as
defined below)
RMB50.0 million
(approximately
HK$54.8
million)
356,840 8.2% 1.0% 7.1% 1.0%
Guangtong
Gongying
(as defined
below)
(Note 4)
RMB200.0 million
(HK$219.3
million)
1,441,800 33.0% 4.1% 28.7% 4.0%
Total RMB250.0 million
(HK$274.1
million)
1,798,640 41.2% 5.1% 35.8% 5.0%
Notes:
(1) Calculated for illustrative purpose based on the exchange rate of HK$1 to RMB0.9120, being the exchange rate
set by PBOC prevailing on June 20, 2024. The actual investment amount may vary subject to the exchange rate
to be determined in accordance with the relevant Cornerstone Investment Agreements.
(2) The investment amount payable by Jiangkong is inclusive of brokerage, SFC transaction levy, Stock Exchange
trading fee and AFRC transaction levy, whereas the investment amount payable by Guangtong Gongying is
exclusive of brokerage, SFC transaction levy, Stock Exchange trading fee and AFRC transaction levy.
(3) Rounded down to the nearest whole board lot of 20 H Shares.
(4) Guangtong Gongying has agreed to subscribe for at the Offer Price (i) the number of H Shares (rounded down
to the nearest whole board lot of 20 H Shares) that may be purchased with an amount of Hong Kong dollar
equivalent of RMB200.0 million, or (ii) 33.3% of the number of Offer Shares offered under the Global
Offering (rounded down to the nearest whole board lot of 20 H Shares and assuming that the Over-allotment
Option is not exercised), whichever the lower.
CORNERSTONE INVESTORS
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THE CORNERSTONE INVESTORS
The information about our Cornerstone Investors set forth below has been provided by the
Cornerstone Investors in connection with the Cornerstone Investments.
Jiangkong
Jiangsu Jiangkong Investment Co., Ltd. (ʮ̡)( “ Jiangkong ”) is a
limited liability company established in the PRC on February 24, 2024, and is 99.99% owned
by Ganzhou Zhongchuan Jiangkong Equity Investment Center (Limited Partnership) ( ᜯψʕ
ᛆҳ༟ʕː(Υྫ)) (“Ganzhou Zhongchuan ”) as of the Latest Practicable Date.
Ganzhou Zhongchuan is a limited partnership established in the PRC focusing in equity
investments, and is managed by CCMG PE funds management Co., Ltd. (છ(ݵ)ᛆ
ʮ̡)( “CCMG PE ”) as its general partner with approximately 0.29% of the
partnership interest in Ganzhou Zhongchuan. Ganzhou Zhongchuan has three limited partners,
being Shanghai Yasida Technology Development Co., Ltd. (ʮ̡)
(“Shanghai Y asida ”), Shanghai Qiuteng Asset Management Co., Ltd. (ࠢ
ʮ̡)( “ Shanghai Qiuteng ”) and Jiuli Group Co., Ltd. (ʮ̡)( “ Jiuli
Group ”), holding approximately 42.86%, 42.57% and 14.29% of the partnership interests in
Ganzhou Zhongchuan, respectively. Shanghai Yasida is held by Guo Ying (ߵas to 65% and
Guo Libi( ெл၀) as to 35%. Shanghai Qiutent is held as to 55% by Shanghai Jieyu Technology
(which is in turn held as to 70% by Chen Bin ( ௓ⅳ) and 30% by Chen Yanmei ( ௓ᜮૠ)) and
45% by Shanghai Yasida. To the best knowledge and information of the Directors, Jiuli Group
has no control of Ganzhou Zhongchuan or Jiangkong. CCMG PE is a registered private fund
manager under the relevant PRC Laws. CCMG PE has six shareholders, with China Culture
Media Group Co., Ltd. (ʮ̡)( “ CCMG”) being the largest
shareholder holding approximately 19.59% of the equity interests in CCMG PE. CCMG is
wholly-owned by the State Council of the PRC.
As at the Latest Practicable Date, Zhejiang Jiuli Investment, which is wholly owned by
Zhejiang Jiuli Hi-tech Metals Co., Ltd. (ʮ̡)( “ Zhejiang Jiuli
Hi-tech ”) (a company listed on the Shenzhen Stock Exchange, stock code: 002318), held
approximately 1.49% of the total issued Shares of our Company. Jiuli Group holds
approximately 35.58% of the total issued shares of and is the holding company of Zhejiang
Jiuli Hi-tech, and according to the public disclosure of Zhejiang Jiuli Hi-tech, its financial
results are consolidated into those of Jiuli Group. In addition, Shanghai Qiuteng is a limited
partner of Jiaxing Chengshun Phase II, our existing Shareholder holding approximately 4.95%
of the total issued Shares as at the Latest Practicable Date, with approximately 19.98% of the
partnership interest of Jiaxing Chengshun Phase II.
Based on the information above, (i) Jiangkong is not a close associate of Zhejiang Jiuli
Investment, one of our existing Shareholders, as defined under the Listing Rules; and (ii)
Shanghai Qiuteng is not a close associate of Jiaxing Chengshun Phase II, one of our existing
Shareholders, as defined under the Listing Rules.
CORNERSTONE INVESTORS
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For the purpose of the Cornerstone Investment, Jiangkong will through its wholly owned
subsidiary, HONGKONG JIANGKONG INVESTMENT LIMITED, to subscribe for and hold
such number of Offer Shares under the relevant Cornerstone Investment Agreement.
Guangtong Gongying
Wuhan Guangtong Gongying Enterprise Management Partnership (Limited Partnership)
(ဏΈஷ΍ᙊΆุ၍ଣΥྫΆุ(Υྫ)) (“ Guangtong Gongying ”) is a limited
partnership established in the PRC on May 17, 2024, which mainly engages in investment
activities with self-owned funds and asset management services with self-owned funds.
Guangtong Gongying is managed by Wuhan Optics Valley Growth Venture Capital
Management Co., Ltd. (ʮ̡)( “ Optics Valley Growth VC ”)
as its general partner with approximately 0.005% of the partnership interest in Guangtong
Gongying. Guangtong Gongying has three limited partners, being Wuhan Optics Valley
Venture Capital Fund Co., Ltd. (ʮ̡)( “Optics Valley VC Fund ”),
Wuhan Optics Valley Industrial Investment Co., Ltd. (ʮ̡)( “ Optics
Valley Industrial Investment ”) and Wuhan Optics Valley Intelligent Network Technology
Co., Ltd. (ʮ̡)( “ Optics Valley Intelligent Network
Technology ”), holding approximately 39.995%, 30.000% and 30.000% of the partnership
interests in Guangtong Gongying, respectively.
Optics Valley VC Fund is held as to 57% by Wuhan Optics Valley Financial Holding
Group Co., Ltd (ʮ̡)( “ Optics Valley Financial Holding ”) and
43% by Optics Valley Growth VC. Optics Valley Financial Holding is in turn held as to
approximately 54.6% by Hubei Science and Technology Investment Group Co., Ltd. (޲
ʮ̡)( “ Hubei Science and Technology Investment ”), 20.0% by Wuhan
Hi-Tech State-owned Holding Group Co., Ltd. (ʮ̡)( “ Wuhan
Hi-Tech State-owned Holding ”), 12.5% by Wuhan Gehua Group Co., Ltd. (ဏ໤ʷණྠϞ
ʮ̡)( “Wuhan Gehua Group ”), 12.5% by Wuhan Hi-Tech Agriculture Group Co., Ltd. (؛
ʮ̡)( “ Wuhan Hi-Tech Agiculture ”), 0.4% by National Development
Fund Co., Ltd. (ʮ̡). Hubei Science and Technology Investment, Wuhan
Hi-Tech State-owned Holding, Wuhan Gehua Group and Wuhan Hi-Tech Agiculture are all
wholly owned by Wuhan Donghu New Technology Development Zone Management
Committee (ึ).
Optics Valley Industrial Investment is wholly owned by Hubei Science and Technology
Investment.
Optics Valley Intelligent Network Technology is wholly owned by Wuhan Optics Valley
Transportation Construction Co., Ltd. (ʮ̡), which is in turn held as to
approximately 95.98% by Hubei Science and Technology Investment.
Optics Valley Growth VC is a limited liability company established in the PRC which
mainly engages in venture capital management and venture capital consulting services. Optics
Valley Growth VC is a non-wholly owned subsidiary of Optics Valley Financial Holding, which
CORNERSTONE INVESTORS
– 485 –


--- page 495 ---
is interested in 80% of the voting rights in Optics Valley Growth VC. Optics Valley Financial
Holding is in turn ultimately controlled by Wuhan Donghu New Technology Development
Zone Management Committee (ึ) (please refer to above for
details).
For the purpose of the Cornerstone Investment, Guangtong Gongying will through its
wholly owned subsidiary, GuangTong Prosperous (Hong Kong) Co., Limited, to subscribe for
and hold such number of Offer Shares under the relevant Cornerstone Investment Agreement.
CLOSING CONDITIONS
The subscription obligation of each of the Cornerstone Investors under the Cornerstone
Investment Agreements is subject to, among other things, the following closing conditions:
(a) the underwriting agreements for the Hong Kong Public Offering and the
International Offering being entered into by, among others, our Company and the
Sole Overall-Coordinator 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 International Underwriters);
(c) the Listing Committee of the Stock Exchange having granted the listing of, and
permission to deal in, the H Shares (including the H Shares subscribed for by each
of the Cornerstone Investors as well as other applicable waivers and approvals in
relation to the Listing application), 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) the respective representations, warranties, undertakings, acknowledgements and
confirmations of the Cornerstone Investor under the Cornerstone Investment
Agreement are accurate and true in all respects as of the date of the Cornerstone
Investment Agreement and as of closing of the Cornerstone Investment, and not
misleading and that there is no breach of such Cornerstone Investment Agreement
on the part of the Cornerstone Investor; and
(e) no laws shall have been enacted or promulgated which prohibit the consummation
of the transactions contemplated in the Global Offering or in the Cornerstone
Investment Agreements and there shall be no orders or injunctions from government
authority or a court of competent jurisdiction in effect precluding or prohibiting
consummation of such transactions contemplated in the Global Offering or in the
Cornerstone Investment Agreement.
CORNERSTONE INVESTORS
– 486 –


--- page 496 ---
RESTRICTIONS ON DISPOSALS BY THE CORNERSTONE INVESTORS
Each of the Cornerstone Investors has agreed that it will not, whether directly or
indirectly, at any time during the period of six months from the Listing Date (the “ Lock-up
Period ”), dispose of any of the Offer Shares they have subscribed for pursuant to the relevant
Cornerstone Investment Agreement, save for in certain limited circumstances, such as transfers
to any of its wholly-owned subsidiaries who will be bound by the same obligations of such
Cornerstone Investor, including the Lock-up Period restriction.
CORNERSTONE INVESTORS
– 487 –


--- page 497 ---
HONG KONG UNDERWRITERS
China International Capital Corporation Hong Kong Securities Limited
China Securities (International) Brokerage Company Limited
CMBC Securities Company Limited
Orient Securities (Hong Kong) Limited
ABCI Securities Company Limited
CCB International Capital Limited
China Everbright Securities (HK) Limited
China Galaxy International Securities(Hong Kong) Co., Limited
China Merchants Securities (HK) Co., Limited
CMB International Capital Limited
DBS Asia Capital Limited
GF Securities (Hong Kong) Brokerage Limited
ICBC International Securities Limited
Shenwan Hongyuan Securities (H.K.) Limited
Zhongtai International Securities Limited
Fosun International Securities Limited
Futu Securities International (Hong Kong) Limited
Guosen Securities (HK) Capital Company Limited
Livermore Holdings Limited
Tiger Brokers (HK) Global Limited
TradeGo Markets Limited
UNDERWRITING ARRANGEMENTS AND EXPENSES
The Hong Kong Public Offering
Hong Kong Underwriting Agreement
Pursuant to the Hong Kong Underwriting Agreement, our Company is offering initially
436,580 Hong Kong Offer Shares (subject to reallocation) for subscription by the public in
Hong Kong on and subject to the terms and conditions of this Prospectus at the Offer Price.
Subject to the Listing Committee granting approval for the listing of, and permission to
deal in, the H Shares to be issued pursuant to the Global Offering (including any H Shares
which may be issued pursuant to the exercise of the Over-allotment Option) and certain other
conditions set out in the Hong Kong Underwriting Agreement, the Hong Kong Underwriters
have agreed to severally (and not jointly or jointly and severally) to subscribe or procure
subscribers for their respective applicable proportions of the Hong Kong Offer Shares now
being offered which are not taken up under the Hong Kong Public Offering on and subject to
the terms and conditions of this Prospectus and the Hong Kong Underwriting Agreement.
UNDERWRITING
– 488 –


--- page 498 ---
The Hong Kong Underwriting Agreement is conditional upon and subject to, among other
things, the International Underwriting Agreement having been signed and becoming
unconditional and not having been terminated in accordance with its terms.
Grounds for Termination
The Sole Sponsor and the Sole Overall Coordinator (for itself and on behalf of the Hong
Kong Underwriters) shall, in their sole and absolute discretion, be entitled by notice (in
writing) to the Company to terminate the Hong Kong Underwriting Agreement with immediate
effect if prior to 8:00 a.m. on the Listing Date:
(a) there shall develop, occur, exist or come into effect:
(i) any event or series of events or circumstance in the nature of force majeure
(including, without limitation, any acts of government, declaration of a
national or international or regional emergency or war, calamity, crisis,
epidemic, pandemic, outbreak of diseases or its escalations, mutation or
aggravation (including, without limitation, COVID-19, SARS, swine or avian
flu, H5N1, H1N1, H1N7, H7N9, Ebola virus, Middle East respiratory
syndrome (MERS) and such related/mutated forms), accidents or prolonged
interruption or delay in transportation, economic sanctions, strikes, labour
disputes, lock-outs, other industrial actions, fire, explosion, flooding,
earthquake, tsunami, volcanic eruption, riots, rebellion, civil commotion,
public disorder, acts of war, outbreak or escalation of hostilities (whether or
not war is declared), acts of God or acts of terrorism (whether or not
responsibility has been claimed)), economic sanctions, paralysis in government
operations, interruptions or delay in transportation in or affecting Hong Kong,
the PRC, the United States, Japan, Singapore, the United Kingdom, the
European Union (or any member thereof), or any other jurisdictions relevant to
any member of the Group (collectively, the “ Relevant Jurisdictions ”); or
(ii) any change, or any development involving a prospective change, or any event
or circumstance likely to result in any change or development involving a
prospective change in any local, national, regional or international financial,
economic, political, military, industrial, legal, fiscal, regulatory, currency,
credit or market conditions, equity securities or exchange control or any
monetary or trading settlement system (including, without limitation,
conditions in the stock and bond markets, money and foreign exchange
markets, the interbank markets and credit markets) in or affecting any Relevant
Jurisdictions; or
UNDERWRITING
– 489 –


--- page 499 ---
(iii) 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
Shanghai Stock Exchange, the Shenzhen Stock Exchange, the New York Stock
Exchange, the NASDAQ Global Market or the London Stock Exchange; or
(iv) any general moratorium on commercial banking activities in Hong Kong
(imposed by the Financial Secretary or the Hong Kong Monetary Authority or
other competent authority), the PRC, New York (imposed at Federal or New
York State level or other competent authority), London, or any other 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
(v) any new Law (as defined in the Hong Kong Underwriting Agreement), or any
change or any development involving a prospective change or any event or
circumstance likely to result in a change or a development involving a
prospective change in (or in the interpretation or application by any court or
other competent authority of) existing laws, in each case, in or affecting any of
the Relevant Jurisdictions; or
(vi) the imposition of sanctions, in whatever form, or the withdrawal of trading
privileges, directly or indirectly, under any sanction Laws (as defined in the
Hong Kong Underwriting Agreement), or regulations in, Hong Kong, the PRC
or any of the Relevant Jurisdiction; or
(vii) a change or development involving a prospective change in or affecting taxes
or exchange control, currency exchange rates or foreign investment regulations
(including, without limitation, a material devaluation of the Hong Kong dollar
or the Renminbi against any foreign currencies, a change in the system under
which the value of the Hong Kong dollar is linked to that of the United States
dollar), or the implementation of any exchange control, in any of the Relevant
Jurisdictions; or
(viii) any litigation or claim of any third party being threatened or instigated against
any member of the Group; or
(ix) a Director, a Supervisor or a member of the Group’s senior management as
named in this Prospectus being charged with an indictable offense, or
prohibited by operation of law or otherwise disqualified from taking part in the
management or taking directorship or supervisorship of a company; or
(x) a contravention by any member of the Group of the Listing Rules or applicable
Laws (as defined in the Hong Kong Underwriting Agreement); or
UNDERWRITING
– 490 –


--- page 500 ---
(xi) non-compliance of this prospectus (or any other documents used in connection
with the contemplated offer and sale of the H Shares), the CSRC Filings (as
defined in the Hong Kong Underwriting Agreement) or any aspect of the
Global Offering with the Listing Rules, the CSRC Rules (as defined in the
Hong Kong Underwriting Agreement) or any other applicable Laws (as defined
in the Hong Kong Underwriting Agreement); or
(xii) other than with the written consent of the Sole Overall Coordinator, the issue
or requirement to issue by the Company of any supplement or amendment to
this prospectus (or to any other documents used in connection with the
contemplated offer and sale of the H Shares) pursuant to the Companies
Ordinance or the Companies (Winding Up and Miscellaneous Provisions)
Ordinance or the Listing Rules, the CSRC Rules (as defined in the Hong Kong
Underwriting Agreement) or any requirement or request of the Stock
Exchange, the CSRC and/or the SFC; or
(xiii) any change or prospective change or development, or a materialization of, any
of the risks set out in the section headed “Risk Factors” of this Prospectus; or
(xiv) a valid demand by any creditor for repayment or payment of any indebtedness
of any member of the Group or in respect of which any member of the Group
is liable prior to its stated maturity or any loss or damage sustained by that
member of the Group (howsoever caused and whether or not the subject of any
insurance or claim against any person),
which, individually or in the aggregate, in the sole and absolute opinion of the Sole
Overall Coordinator and the Sole Sponsor: (A) has or will or may have a material adverse
effect on the assets, liabilities, business, general affairs, management, prospects,
shareholders’ equity, profits, losses, results of operations, position or condition, financial
or otherwise, or performance of the Group as a whole; or (B) has or will or may have a
material adverse effect on the success of the Global Offering or the level of applications
under the Hong Kong Public Offering or the level of interest under the International
Offering; or (C) make or will or may make it inadvisable or inexpedient or impracticable
for the Global Offering, to proceed or to market the Global Offering or the delivery or
distribution of the Offer Shares on the terms and in the manner contemplated by the
Offering Related Documents (as defined below); or (D) has or will or may have the effect
of making any part of the Hong Kong Underwriting Agreement (including underwriting)
incapable of performance in accordance with its terms or preventing or delaying the
processing of applications and/or payments pursuant to the Global Offering or pursuant
to the underwriting thereof.
UNDERWRITING
– 491 –


--- page 501 ---
(b) there has come to the notice of the Sole Overall Coordinator or the Sole Sponsor:
(i) that any statement contained in any of the Offering Documents (as defined in
the Hong Kong Underwriting Agreement), the formal notice, the Operative
Documents (as defined in the Hong Kong Underwriting Agreement), the
Preliminary Offering Circular (as defined in the Hong Kong Underwriting
Agreement), the PHIP (as defined in the Hong Kong Underwriting Agreement)
and/or in any notices, announcements, advertisements, communications or
other documents issued or used by or on behalf of the Company in connection
with the Hong Kong Public Offering (collectively, the “ Offer Related
Documents ”) (including any supplement or amendment thereto) was, when it
was issued, or has become, untrue, incorrect, inaccurate, incomplete or
misleading or deceptive in any material respect, or that any forecast, estimate,
expression of opinion, intention or expectation contained in any of the Offer
Related Documents (including any supplement or amendment thereto) is not
fair and honest and based on reasonable assumptions; or
(ii) that any matter has arisen or has been discovered which would, had it arisen
or been discovered immediately before the date of this Prospectus, constitute
a material misstatement in or omission from any of the Offer Related
Documents (including any supplement or amendment thereto); or
(iii) any material breach of any of the obligations imposed upon any party to the
Hong Kong Underwriting Agreement or the International Underwriting
Agreement (other than upon any of the Hong Kong Underwriters or the
International Underwriters); or
(iv) any event, act or omission which gives or is likely to give rise to any liability
of any of the Indemnifying Parties (as defined in the Hong Kong Underwriting
Agreement) pursuant to the provisions under the Hong Kong Underwriting
Agreement; or
(v) any adverse change, or any development involving a prospective adverse
change, in the assets, liabilities, business, general affairs, management,
prospects, shareholders’ equity, profits, losses, earnings, results of operations,
position or condition, financial or otherwise, or performance of the Group as
a whole; or
(vi) any breach of, or any event or circumstance rendering untrue or incorrect,
incomplete or misleading in any respect, any of the Warranties (as defined in
the Hong Kong Underwriting Agreement); or
(vii) the chairman, the chief executive officer or the chief financial officer of the
Company or any of the executive Directors vacating his/her or her office; or
UNDERWRITING
– 492 –


--- page 502 ---
(viii) an Authority (as defined in the Hong Kong Underwriting Agreement) or a
political body or organization in any Relevant Jurisdiction commencing any
investigation or other action, or announcing an intention to investigate or take
other action, against any Director or a member of the Company’s senior
management as disclosed in this prospectus; or
(ix) that approval by the Listing Committee of the Stock Exchange of the listing of,
and permission to deal in, the H Shares to be issued or sold (including any
additional H Shares that may be issued or sold pursuant to the exercise of the
Over-allotment Option) under the Global Offering is refused or not granted,
other than subject to customary conditions, on or before the Listing Date, or if
granted, the approval is subsequently withdrawn, qualified (other than by
customary conditions) or withheld; or
(x) that the Company withdraws any of the Offering Documents (as defined in the
Hong Kong Underwriting Agreement) or the Global Offering; or
(xi) that any expert (other than the Sole Sponsor) specified in this prospectus,
whose consent is required for the issue of the 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 to
being named in this prospectus or to the issue of any of the Offer Related
Documents; or
(xii) that there is a prohibition on the Company for whatever reason from offering,
allotting, issuing or selling any of the Offer Shares pursuant to the terms of the
Global Offering; or
(xiii) any Director, Supervisor or member of senior management of the Company as
disclosed in this prospectus being charged with an indictable offence or is
prohibited by operation of law or otherwise disqualified from taking part in the
management of a company or that there is the commencement by any
governmental, political or regulatory body of any investigation or other action
against any Director, Supervisor or member of senior management of the
Company in his/her capacity as such, or an announcement by any
governmental, political or regulatory body that it intends to commence any
such investigation or take any such action; or
(xiv) that there is any order or petition for the winding-up of any member of the
Group or any composition or arrangement made by any member of the Group
with its creditors or a scheme of arrangement entered into by any member of
the Group or any resolution for the winding-up of any member of the Group or
the appointment of a provisional liquidator, receiver or manager over all or part
of the material assets or undertaking of any member of the Group or anything
analogous thereto occurring in respect of any member of the Group; or
UNDERWRITING
– 493 –


--- page 503 ---
(xv) that a material portion of the orders placed or confirmed in the bookbuilding
process, or of the investment commitments made by any cornerstone investors
under agreements signed with such cornerstone investors, have been
withdrawn, terminated or cancelled.
Undertakings pursuant to the Listing Rules and the Hong Kong Underwriting Agreement
Undertakings by our Company
In accordance with Rule 10.08 of the Listing Rules, we have undertaken to the Hong
Kong Stock Exchange that, no further Shares or securities convertible into equity securities of
our Company (whether or not of a class already listed) may be issued by us 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 the issue of Shares or securities pursuant to the Global Offering (including the
Over-allotment Option) or under any of the circumstances provided under Rule 10.08 of the
Listing Rules.
Except for the offer and sale of the Offer Shares pursuant to the Global Offering
(including pursuant to the Over-allotment Option) and otherwise pursuant to the Listing Rules,
during the period commencing on the date of the Hong Kong Underwriting Agreement and
ending on, and including, the date that is six months after the Listing Date (the “ First
Six-Month Period ”), the Company hereby undertakes to each of the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Sponsor-Overall
Coordinator, the Sole Overall Coordinator, the Capital Market Intermediaries, the Hong Kong
Underwriters and the Sole Sponsor not to 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 (particularly, Rule 10.08 of the
Listing Rules):
(i) allot, issue, sell, accept subscription for, offer to allot, issue, repurchase or sell,
contract or agree to allot, issue or sell, mortgage, charge, pledge, 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 over, either directly or indirectly, conditionally or unconditionally,
any legal or beneficial interest in, any H Shares or other securities of the Company
or any interest in any of the foregoing (including, 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 H shares), or deposit any H Shares or other securities
of the Company, as applicable, with a depositary in connection with the issue of
depositary receipts; or
UNDERWRITING
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--- page 504 ---
(ii) enter into any swap or other arrangement that transfers to another, in whole or in
part, any of the economic consequences of ownership of any H Shares or other
securities of the Company, or any interest in any of the foregoing (including, 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 H Shares); or
(iii) enter into any transaction with the same economic effect as any transaction specified
in sub-paragraph (i) or (ii) above; or
(iv) offer to or agree to or announce any intention to effect any transaction specified in
sub-paragraph (i), (ii) or (iii) above,
in each case, whether any of the transactions specified in sub-paragraph (i), (ii) or (iii) above
is to be settled by delivery of H Shares or other equity securities of the Company, as applicable,
or in cash or otherwise (whether or not the issue of such H Shares or other shares or securities
will be completed within the First Six-Month Period). In the event that, during the period of
six months commencing on the date on which the First Six-Month Period expires (the “ Second
Six-Month Period ”), the Company enters into any of the transactions specified in sub-
paragraph (i), (ii) or (iii) above or offers to or agrees to or announces any intention to effect
any such transaction, the Company shall take all reasonable steps to ensure that it will not
create a disorderly or false market in the securities of the Company. Our Controlling
Shareholders undertake to each of the Sole Sponsor, the Sole Overall Coordinator, the Joint
Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market
Intermediaries and the Hong Kong Underwriters to procure the Company to comply with the
foregoing undertakings.
Undertakings by the Controlling Shareholders
Each member of our Controlling Shareholders hereby undertakes to each of the Sole
Sponsor, the Sole Overall Coordinator, the Joint Global Coordinators, the Joint Bookrunners,
the Joint Lead Managers, the Capital Market Intermediaries, the Hong Kong Underwriters and
the Company that subject to the terms of the Hong Kong Underwriting Agreement, 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:
(i) he/she/it will not, and will procure that the relevant registered holder(s), any
nominee or trustee holding on trust for him/her/it and the companies controlled by
him/her/it will not, at any time during the First Six-Month Period, (a) sell, offer to
sell, contract or agree to sell, mortgage, charge, pledge, hypothecate, lend, grant or
sell any option, warrant, contract or right to purchase, grant or purchase any option,
warrant, contract or right to sell, or otherwise transfer or dispose of or create an
Encumbrance over, or agree to transfer or dispose of or create an Encumbrance over,
either directly or indirectly, conditionally or unconditionally, any H Shares or other
securities of the Company or any legal or beneficial interest therein (including any
securities convertible into or exchangeable or exercisable for or that represent the
UNDERWRITING
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--- page 505 ---
right to receive, or any warrants or other rights to purchase, any Shares) (the
“Locked-up Securities ”), or deposit any Shares or other securities of the Company
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 of any Locked-up Securities, or (c) enter
into any transaction with the same economic effect as any transaction specified in
(a) or (b) above, or (d) offer to or agree to or announce any intention to effect any
transaction specified in (a), (b) or (c) above, in each case, whether any of the
transactions specified in (a), (b) or (c) above is to be settled by delivery of H Shares
or other securities of the Company or in cash or otherwise (whether or not the issue
of such Shares or other securities will be completed within the First Six-Month
Period or the Second Six-Month Period);
(ii) he/she/it will not, during the Second Six-Month Period, enter into any of the
transactions specified in (i)(a), (i)(b), (i)(c) or (i)(d) above or offer to or agree to or
contract or publicly 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 pursuant to such
transaction, he/she/it will cease to be a “controlling shareholder” (as the term is
defined in the Listing Rules) of the Company;
(iii) 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)(a), (i)(b) or (i)(c) above or offer to or
agrees to or announces any intention to effect any such transaction, he/she/it will
take all reasonable steps to ensure that it will not create a disorderly or false market
in the securities of the Company;
(iv) at any time during the First Six-Month Period and the Second Six-Month Period,
he/she/it or any relevant registered holder will (a) if and when he/she/it or any
relevant registered holder pledges or charges any Shares or other securities (or
interest therein) of the Company beneficially owned by it, immediately inform the
Company, the Sole Sponsor and the Sole Overall Coordinator in writing of such
pledge or charge together with the number of Shares or other securities of the
Company so pledged or charged; and (b) if and when he/she/it or any relevant
registered holder receives indications, either verbal or written, from any pledgee or
chargee that any of the pledged or charged Shares or other securities (or interest
therein) of the Company will be disposed of, immediately inform the Company, the
Sole Sponsor and the Sole Overall Coordinator in writing of such indications. For
the avoidance of doubt, the lock-up arrangements with the Controlling Shareholders
referred to herein shall not prevent any of the Controlling Shareholders from (1)
using the Shares or other securities of the Company (or any interest therein)
beneficially owned by them respectively as security (including a charge or a pledge)
in favour of an authorized institution (as defined in the Banking Ordinance (Chapter
155 of the Laws of Hong Kong)) for a bona fide commercial loan; and (2)
purchasing additional Shares or other securities of the Company or any interest
UNDERWRITING
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--- page 506 ---
therein or dispose of Shares or other securities of the Company (or any interest
therein) which are purchased in the First Six-Month Period and the Second
Six-Month Period, provided that such purchase does not contravene the compliance
by the Company with the requirement of Rule 8.08 of the Listing Rules to maintain
an open market in the securities and a sufficient public float in the Shares.
Indemnity
Each of the Company and the Controlling Shareholders has agreed to indemnify, among
others, the Sole Sponsor, the Sole Overall Coordinator, the Joint Global Coordinators, the Joint
Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries and the Hong Kong
Underwriters for certain losses which they may suffer, including any breach by them,
respectively of the Hong Kong Underwriting Agreement or certain provisions thereof.
Sole Sponsor’s Fee
An amount of US$1,000,000 is payable by our Company as sponsor fees to the Sole
Sponsor.
The International Offering
In connection with the International Offering, it is expected that our Company will enter
into the International Underwriting Agreement with, among others, the Sole Overall
Coordinator, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers
and the International Underwriters. Under the International Underwriting Agreement, the
International Underwriters will, subject to certain conditions set out therein, severally and not
jointly, agree to procure subscribers or purchasers for the International Offer Shares
(excluding, for the avoidance of doubt, the Offer Shares which are subject to the Over-
allotment Option), failing which they agree to subscribe for or purchase their respective
proportions of the International Offer Shares which are not taken up under the International
Offering.
Our Company is expected to grant to the International Underwriters the Over-allotment
Option, exercisable by the Sole Overall Coordinator on behalf of the International
Underwriters at any time from the date of the International Underwriting Agreement until 30
days after the last day for the lodging of applications under the Hong Kong Public Offering,
to require our Company to issue and allot up to an aggregate of 654,840 additional Offer Shares
representing no more than 15% of the initial Offer Shares, at the same price per Offer Share
under the International Offering to cover, among other things, over-allocations (if any) in 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 if the International Underwriting Agreement is not entered into, or is terminated, the
Global Offering will not proceed.
UNDERWRITING
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--- page 507 ---
Total Commission and Expenses
The Capital Market Intermediaries and the Underwriters will receive an underwriting
commission (the “ Fixed Fees ”) equals to 4.0% of the aggregate sale proceeds from the Global
Offering (including any proceeds arising from the exercise of any Over-allotment Option)
(collectively the “ Gross Proceeds ”). Our Company may, at our sole and absolute discretion,
pay to one or more Capital Market Intermediaries or Underwriters an incentive fee up to 1.5%
of the Gross Proceeds (the “ Discretionary Fees ”). Assuming the Discretionary Fees are paid
in full, the ratio of Fixed Fees and Discretionary Fees payable to all Underwriters is 58.7:41.3.
For unsubscribed Hong Kong Offer Shares reallocated to the International Offering, we will
pay an underwriting commission at the rate applicable to the International Offering and such
commission will be paid to the relevant International Underwriters and not the Hong Kong
Underwriters.
The aggregate commissions and fees, together with listing fees, SFC transaction levy,
AFRC transaction levy, Hong Kong Stock Exchange trading fee, legal and other professional
fees and other expenses, payable by our Company relating to the Global Offering are estimated
to be approximately HK$92.4 million in total.
Activities by Syndicate Members
We describe below a variety of activities that underwriters of the Hong Kong Public
Offering and the International Offering (together, referred to as “ Syndicate Members ”) and
their affiliates may each individually undertake and (as further described below) which do not
form part of the underwriting or the stabilizing 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 the ordinary course of their
various business activities, the Syndicate Members and their respective affiliates may
purchase, sell or hold a broad array of investments and actively trade securities, derivatives,
loans, commodities, currencies, credit default swaps, and other financial instruments for their
own account and for the accounts of their customers. Such investment and trading activities
may involve or relate to assets, securities and/or instruments of our Company and/or persons
and entities with relationships with our Company and may also include swaps and other
financial instruments entered into for hedging purposes in connection with our Group’s loans
and other debt.
In relation to the H Shares, the activities of the Syndicate Members and their affiliates
could include acting as agent for buyers and sellers of the H Shares, entering into transactions
with those buyers and sellers in a principal capacity, proprietary trading in the H Shares and
entering into over the counter or listed derivative transactions or listed and unlisted securities
transactions (including issuing securities such as derivative warrants listed on a stock exchange)
which have the H Shares as their or part of their underlying assets. Those activities may require
UNDERWRITING
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--- page 508 ---
hedging activity by those entities involving, directly or indirectly, buying and selling the 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 the H
Shares, in baskets of securities or indices including the H Shares, in units of funds that may
purchase the 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 the H Shares as their or part of their underlying assets, whether on the Hong Kong Stock
Exchange or on any other stock exchange, the rules of the relevant 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 the H Shares in most
cases.
All of these activities may occur both during and after the end of the stabilizing period
described in “Structure of the Global Offering – The International Offering – Over-allotment
Option” and “Structure of the Global Offering – The International Offering – Stabilization.”
These activities may affect the market price or value of the H Shares, the liquidity or trading
volume in the H Shares and the volatility of their share price, 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 (other than the Stabilizing Manager, its affiliates or any
person acting for it) 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) all of them must comply with all applicable laws, including the market misconduct
provisions of the SFO, the provisions prohibiting insider dealing, false trading, price
rigging and stock market manipulation.
Hong Kong Underwriters’ Interests in our Company
Save as otherwise disclosed in this prospectus and save for its obligations under the Hong
Kong Underwriting Agreement, none of the Hong Kong Underwriters has 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 the Shares as a result of fulfilling their
obligations under the Underwriting Agreements.
UNDERWRITING
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--- page 509 ---
Other Services to our Company
Certain of the Sole Overall Coordinator and the Underwriters or their respective affiliates
have, from time to time, provided and expect to provide in the future investment banking and
other services to our Company and our respective affiliates, for which such Sole Overall
Coordinator, Underwriters or their respective affiliates have received or will receive customary
fees and commissions.
Other Services Provided by the Underwriters
The Sole Overall Coordinator, the Joint Global Coordinators, the Joint Bookrunners, the
Joint Lead Managers and the Underwriters may in their ordinary course of business provide
financing to investors subscribing for the Offer Shares offered by this prospectus. Such Sole
Overall Coordinator, Joint Global Coordinators, Joint Bookrunners, Joint Lead Managers and
Underwriters may enter into hedges and/or dispose of such Offer Shares in relation to the
financing which may have a negative impact on the trading price of our H Shares.
Over-allotment Option and Stabilization
Details of the arrangements relating to the stabilization and Over-allotment Option are set
forth in “Structure of the Global Offering – The International Offering – Stabilization,” and
“Structure of the Global Offering – The International Offering – Over-allotment Option.”
Independence of the Sole Sponsor
The Sole Sponsor satisfied the independence criteria set out in Rule 3A.07 of the Listing
Rules.
UNDERWRITING
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--- page 510 ---
THE GLOBAL OFFERING
This Prospectus is published in connection with the Hong Kong Public Offering as part
of the Global Offering. The Global Offering comprises:
(i) the Hong Kong Public Offering of initially 436,580 Offer Shares in Hong Kong as
described below in the paragraph headed “– The Hong Kong Public Offering”
below; and
(ii) the International Offering of an aggregate of initially 3,929,080 Offer Shares,
consisting of the offering of H Shares outside the United States in offshore
transactions in reliance on Regulation S under the U.S. Securities Act as described
in the paragraph headed “– The International Offering” this section below. At any
time from the date of the International Underwriting Agreement until 30 days after
the last day for the lodging of applications under the Hong Kong Public Offering,
the Sole Overall Coordinator, as representative of the International Underwriters,
have an option to require us to issue and allot up to 654,840 additional Offer Shares,
representing approximately 15.0% of the initial number of Offer Shares to be offered
in the Global Offering, at the Offer Price to cover over-allocations in the
International Offering, if any. If the Over-allotment Option is exercised in full, the
Offer Shares will represent approximately 13.9% of our Company’s enlarged share
capital immediately following the completion of the Global Offering and the
exercise of the Over-allotment Option. In the event that the Over-allotment Option
is exercised, a press announcement will be made.
Investors may either
(1) apply for Offer Shares under the Hong Kong Public Offering; or
(2) apply for or indicate an interest for Offer Shares under the International Offering,
but may not do both.
The Offer Shares will represent approximately 12.3% of the enlarged issued share capital
of our Company immediately after completion of the Global Offering without taking into
account the exercise of the Over-allotment Option. If the Over-allotment Option is exercised
in full, the Offer Shares will represent approximately 13.9% of the enlarged issued share
capital immediately after completion of the Global Offering and the exercise of the
Over-allotment Option as set out in “– The International Offering – Over-allotment Option”
below.
The number of Offer Shares to be offered under the Hong Kong Public Offering and the
International Offering may be subject to reallocation as described in the paragraph headed “–
The Hong Kong Public Offering – Reallocation” below.
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
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--- page 511 ---
THE HONG KONG PUBLIC OFFERING
Number of Offer Shares initially offered
Our Company is initially offering 436,580 Offer Shares 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 Hong Kong Public Offering is open to members of the public in Hong Kong as well
as to institutional and professional investors. The Hong Kong Offer Shares will represent
approximately 1.2% of our Company’s registered capital immediately after completion of the
Global Offering, assuming that the Over-allotment Option is not exercised. Professional
investors generally include brokers, dealers, companies (including fund managers) whose
ordinary business involves dealing in shares and other securities and corporate entities which
regularly invest in shares and other securities.
Completion of the Hong Kong Public Offering is subject to the conditions as set out in
“– Conditions of the Global Offering” below.
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
would 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 Offer Shares initially available under the
Hong Kong Public Offering (after taking account of any reallocation referred to below) is to
be divided equally into two pools for allocation purposes: pool A and pool B with any odd lots
being allocated to Pool A. The Offer Shares in pool A will be allocated on an equitable basis
to applicants who have applied for Offer Shares with an aggregate price of HK$5 million
(excluding the brokerage, SFC transaction levy, AFRC transaction levy and Stock Exchange
trading fee payable) or less. The Offer Shares in pool B will be allocated on an equitable basis
to applicants who have applied for Offer Shares with an aggregate price of more than HK$5
million (excluding the brokerage, SFC transaction levy, AFRC transaction levy and Stock
Exchange trading fee payable) and up to the total value in pool B. Investors should be aware
that applications in pool A and applications in pool B may receive different allocation ratios.
If Offer Shares in one (but not both) of the pools are undersubscribed, the surplus Offer Shares
will be transferred to the other pool to satisfy demand in this other pool and be allocated
accordingly. For the purpose of this paragraph only, the “price” for Offer Shares means the
price payable on application therefor (without regard to the Offer Price as finally determined).
Applicants can only receive an allocation of Offer Shares from either pool A or pool B but not
STRUCTURE OF THE GLOBAL OFFERING
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--- page 512 ---
from both pools. Multiple or suspected multiple applications and any application for more than
approximately 50% of the 436,580 H Shares initially comprised in the Hong Kong Public
Offering (that is 218,280 Hong Kong Offer Shares) will be rejected.
Reallocation
The allocation of Offer Shares between the Hong Kong Public Offering and the
International Offering is subject to reallocation under the Listing Rules. Paragraph 4.2 of
Practice Note 18 of the Listing Rules requires a clawback mechanism to 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 certain prescribed total demand levels are reached. 436,580 Offer Shares are
initially available in the Hong Kong Public Offering, representing approximately 10% of the
Offer Shares initially available for subscription under the Global Offering. In accordance with
paragraph 4.2 of Practice Note 18 of the Listing Rules, if the number of Offer Shares validly
applied for in the Hong Kong Public Offering represents (i) 15 times or more but less than 50
times, (ii) 50 times or more but less than 100 times, and (iii) 100 times or more, of the number
of Hong Kong Offer Shares initially available under the Hong Kong Public Offering, the total
number of Hong Kong Offer Shares available under the Hong Kong Public Offering will be
increased to 1,309,700 Offer Shares, 1,746,280 Offer Shares and 2,182,840 Offer Shares,
respectively, representing approximately 30% (in the case of (i)), approximately 40% (in the
case of (ii)) and 50% (in the case of (iii)), respectively, of the total number of Offer Shares
initially available under the Global Offering (before any exercise of the Over-allotment
Option), reallocation being referred to in this Prospectus as “Mandatory Reallocation”.
In such cases, the number of Offer Shares allocated in the International Offering will be
correspondingly reduced, in such manner as the Sole Overall Coordinator deems appropriate,
and such additional Offer Shares will be reallocated to Pool A and Pool B. In addition, if the
Hong Kong Offer Shares are 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, and the
Allocation Cap as defined in and stated under Chapter 4.14 under the Guide for New Listing
Applicants published by the Stock Exchange will not be triggered.
In addition to any Mandatory Reallocation which may be required, the Sole Overall
Coordinator may reallocate Offer Shares initially allocated for the International Offering to the
Hong Kong Public Offering to satisfy valid applications in Pool A and Pool B under the Hong
Kong Public Offering in accordance with Chapter 4.14 of the Guide for New Listing Applicants
issued by the Stock Exchange. In the event that (i) the International Offer Shares are
undersubscribed and the Hong Kong Offer Shares are fully subscribed or oversubscribed
irrespective of the number of times; or (ii) the International Offer Shares are fully subscribed
or oversubscribed and the Hong Kong Offer Shares are fully subscribed or oversubscribed as
to less than 15 times of the number of Hong Kong Offer Shares initially available under the
Hong Kong Public Offering, up to 436,540 Offer Shares may be reallocated to the Hong Kong
Public Offering from the International Offering, so that the total number of the Offer Shares
STRUCTURE OF THE GLOBAL OFFERING
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--- page 513 ---
available under the Hong Kong Public Offering will be increased to no more than 873,120
Offer Shares, representing approximately 20% of the total number of Offer Shares initially
available under the Global Offering (before any exercise of the Over-allotment Option).
In the event that the International Offering and the Hong Kong Public Offering are
undersubscribed, the Global Offering shall not proceed unless fully underwritten by the
Underwriters pursuant to the Underwriting Agreements.
Applications
Each applicant under the Hong Kong Public Offering will also 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/she/it is making the application have 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
Offer Shares under the International Offering, and such applicant’s application is liable to be
rejected if the said undertaking and/or confirmation is breached and/or untrue (as the case may
be) or it has been or will be placed or allocated Offer Shares under the International Offering.
The listing of the H Shares on the Hong Kong Stock Exchange is sponsored by the Sole
Sponsor. Applicants under the Hong Kong Public Offering are required to pay, on application
(subject to application channel), the Offer Price of HK$152.10 per Hong Kong Offer Share in
addition to any brokerage, SFC transaction levy, AFRC transaction levy and Stock Exchange
trading fee payable on each Hong Kong Offer Share. For further details, see “How to Apply
for Hong Kong Offer Shares” in this prospectus.
References in this prospectus to applications, application monies or the procedure for
application relate solely to the Hong Kong Public Offering.
THE INTERNATIONAL OFFERING
Number of Offer Shares offered
Subject to reallocation as described above, the International Offering will consist of an
aggregate of 3,929,080 Offer Shares to be initially offered by us, representing approximately
90% of the total number of Offer Shares initially available under the Global Offering and
approximately 11.1% of our Company’s enlarged share capital immediately after the
completion of the Global Offering, assuming that the Over-allotment Option is not exercised.
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. Professional investors generally include brokers, dealers,
companies (including fund managers) whose ordinary business involves dealing in shares and
other securities and corporate entities which regularly invest in shares and other securities.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 514 ---
Allocation of Offer Shares pursuant to the International Offering will be effected in accordance
with the “book-building” process described in the paragraph headed “– The International
Offering – Pricing of the Global Offering” below 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 of the Offer
Shares on the Hong Kong Stock Exchange. 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 Company and our
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 application under the
Hong Kong Public Offering and to ensure that it is excluded from any application 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 mechanism described in the sub-section
headed “The Hong Kong Public Offering – Reallocation” above, the exercise of the
Over-allotment Option in whole or in part and/or any reallocation of unsubscribed Offer Shares
originally included in the Hong Kong Public Offering.
Over-allotment Option
In connection with the Global Offering, we are expected to grant an Over-allotment
Option to the International Underwriters exercisable by the Sole Overall Coordinator on behalf
of the International Underwriters.
Pursuant to the Over-allotment Option, the Sole Overall Coordinator has the right,
exercisable at any time from the date of the International Underwriting Agreement until 30
days after the last day for the lodging of applications under the Hong Kong Public Offering,
to require our Company to issue and allot up to 654,840 additional Offer Shares, representing
approximately 15% of the initial Offer Shares, at the same price per Offer Share under the
International Offering to cover over-allocation in the International Offering, if any. If the
Over-allotment Option is exercised in full, the additional Offer Shares will represent
approximately 1.8% of our Company’s enlarged share capital immediately following the
completion of the Global Offering and the exercise of the Over-allotment Option. In the event
that the Over-allotment Option is exercised, an announcement will be made.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 515 ---
Stabilization
Stabilization is a practice used by underwriters in some markets to facilitate the
distribution of securities. To stabilize, the underwriters may bid for, or purchase, the securities
in the secondary market, during a specified period of time, to retard and, if possible, prevent,
any decline in the market price of the securities below the offer price. In Hong Kong and
certain other jurisdictions, the price at which stabilization is effected is not permitted to exceed
the offer price.
In connection with the Global Offering, the Stabilizing Manager or any person acting for
it, on behalf of the Underwriters, may over-allocate or effect short sales or any other stabilizing
transactions with a view to stabilizing or maintaining the market price of the H Shares at a level
higher than that which might otherwise prevail in the open market for a limited period after the
Listing Date. Short sales involve the sale by the Stabilizing Manager of a greater number of
H Shares than the Underwriters are required to purchase in the Global Offering. “Covered”
short sales are sales made in an amount not greater than the Over-allotment Option. The
Stabilizing Manager may close out the covered short position by either exercising the
Over-allotment Option to purchase additional H Shares or purchasing H Shares in the open
market. In determining the source of the H Shares to close out the covered short position, the
Stabilizing Manager will consider, among others, the price of H Shares in the open market as
compared to the price at which they may purchase additional H Shares pursuant to the
Over-allotment Option. Stabilizing transactions consist of certain bids or purchases made for
the purpose of preventing or retarding a decline in the market price of the H Shares while the
Global Offering is in progress. Any market purchases of the H Shares may be effected on any
stock exchange, including the Hong Kong Stock Exchange, any over-the-counter market or
otherwise, provided that they are made in compliance with all applicable laws and regulatory
requirements. However, there is no obligation on the Stabilizing Manager or any person acting
for it to conduct any such stabilizing activity, which if commenced, will be done at the absolute
discretion of the Stabilizing Manager and may be discontinued at any time. Any such
stabilizing activity is required to be brought to an end within 30 days after the last day for the
lodging of applications under the Hong Kong Public Offering. The number of the H Shares that
may be over-allocated will not exceed the number of the H Shares that may be issued under
the Over-allotment Option, namely, 654,840 H Shares, which is approximately 15% of the
number of Offer Shares initially available under the Global Offering, in the event that the
whole or part of the Over-allotment Option is exercised.
In Hong Kong, stabilizing activities must be carried out in accordance with the Securities
and Futures (Price Stabilizing) Rules. Stabilizing actions permitted pursuant to the Securities
and Futures (Price Stabilizing) Rules, as amended, include:
(a) over-allocation for the purpose of preventing or minimizing any reduction in the
market price;
(b) selling or agreeing to sell the H Shares so as to establish a short position in them for
the purpose of preventing or minimizing any deduction in the market price;
STRUCTURE OF THE GLOBAL OFFERING
– 506 –


--- page 516 ---
(c) subscribing, or agreeing to subscribe, for the H Shares pursuant to the Over-
allotment Option in order to close out any position established under (a) or (b)
above;
(d) purchasing, or agreeing to purchase, the H Shares for the sole purpose of preventing
or minimizing any reduction in the market price;
(e) selling the H Shares to liquidate a long position held as a result of those purchases;
and
(f) offering or attempting to do anything described in (b), (c), (d) and (e) above.
Stabilizing actions by the Stabilizing Manager, or any person acting for it, will be entered
into in accordance with the laws, rules and regulations in place in Hong Kong on stabilization.
As a result of effecting transactions to stabilize or maintain the market price of the H
Shares, the Stabilizing Manager, or any person acting for it, may maintain a long position in
the H Shares. The size of the long position, and the period for which the Stabilizing Manager,
or any person acting for it, will maintain the long position is at the discretion of the Stabilizing
Manager and is uncertain. In the event that the Stabilizing Manager liquidates this long
position by making sales in the open market, this may lead to a decline in the market price of
the H Shares.
Stabilizing action by the Stabilizing Manager, or any person acting for it, is not permitted
to support the price of the H Shares for longer than the stabilizing period, which begins on the
day on which trading of the H Shares commences on the Hong Kong Stock Exchange and ends
on the thirtieth day after the last day for the lodging of applications under the Hong Kong
Public Offering. The stabilizing period is expected to end on Sunday, August 4, 2024. As a
result, demand for the H Shares, and their market price, may fall after the end of the stabilizing
period. These activities by the Stabilizing Manager may stabilize, maintain or otherwise affect
the market price of the H Shares. As a result, the price of the H Shares may be higher than the
price that otherwise may exist in the open market. Any stabilizing action taken by the
Stabilizing Manager, or any person acting for it, may not necessarily result in the market price
of the H Shares staying at or above the Offer Price either during or after the stabilizing period.
Bids for or market purchases of the H Shares by the Stabilizing Manager, any person acting for
it, may be made at a price at or below the Offer Price and therefore at or below the price paid
for the H Shares by purchasers. A public announcement in compliance with the Securities and
Futures (Price Stabilizing) Rules will be made within seven days of the expiration of the
stabilizing period.
In order to effect stabilization actions, the Stabilizing Manager will arrange cover of up
to an aggregate of 654,840 H Shares, representing up to 15% of the initial Offer Shares,
through delayed delivery arrangements with investors who have been allocated Offer Shares in
the International Offering. The delayed delivery arrangements (if specifically agreed by an
investor) relate only to the delay in the delivery of the Offer Shares to such investor and the
STRUCTURE OF THE GLOBAL OFFERING
– 507 –


--- page 517 ---
Offer Price for the Offer Shares allocated to such investor will be fully paid before the Listing
Date. Both the size of such cover and the extent to which the Over-allotment Option can be
exercised will depend on whether arrangements can be made with investors such that a
sufficient number of H Shares can be delivered on a delayed basis. If no investor in the
International Offering agrees to the delayed delivery arrangements, no stabilizing actions will
be undertaken by the Stabilizing Manager and the Over-allotment Option will not be exercised.
Pricing of the Global Offering
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 around, the last day for lodging applications under the Hong Kong Public Offering.
The Offer Price will be HK$152.10 per Offer Share unless otherwise announced, as
further explained below, not later than the morning of the last day for lodging applications
under the Hong Kong Public Offering.
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
professional and institutional investors during the book-building process, and with the
consent of our Company, reduce the number of Offer Shares offered in the Global
Offering and/or the Offer Price 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 a
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, publish on the website of the Hong
Kong Stock Exchange and on the website of our Company notices of the reduction. Upon the
issue of such a notice, the revised number of Offer Shares and/or the Offer Price will be final
and conclusive. Our Company will also, as soon as practicable following the decision to make
such change, issue a supplemental prospectus updating investors of the change in the number
of Offer Shares being offered under the Global Offering and/or the Offer Price. The Global
Offering must first be canceled and subsequently relaunched on FINI pursuant to the
supplemental prospectus. Applicants should have regard to the possibility that any
announcement of a reduction in the number of Offer Shares being offered under the Global
Offering and/or the Offer Price may not be made until the day which is the last day for lodging
applications under the Hong Kong Public Offering. Such notice will also include confirmation
or revision, as appropriate, of the Global Offering statistics as currently set out in this
Prospectus, and any other financial information which may change as a result of such
reduction. In the absence of any such notice so published, the number of Offer Shares will not
be reduced and/or the Offer Price will under no circumstances be set at a price that is not the
Offer Price as stated in this Prospectus.
STRUCTURE OF THE GLOBAL OFFERING
– 508 –


--- page 518 ---
In the event of a reduction in the number of Offer Shares being offered under the Global
Offering, the Sole Overall Coordinator may at its discretion reallocate the number of Offer
Shares to be offered under the Hong Kong Public Offering and the International Offering,
provided that the Hong Kong Offer Shares shall not be less than 10% of the total number of
Offer Shares in the Global Offering. The International Offer Shares and the Hong Kong Offer
Shares may, in certain circumstances, be reallocated as between these offerings at the
discretion of the Sole Overall Coordinator.
The indications of interest in the Global Offering, the results of applications and the basis
of allotment of Offer Shares available under the Hong Kong Public Offering, are expected to
be announced on Tuesday, July 9, 2024 and to be posted on the website of the Hong Kong Stock
Exchange and on the website of our Company.
UNDERWRITING
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters
under the terms of the Hong Kong Underwriting Agreement and is conditional upon 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 Monday, July 8, 2024.
These underwriting arrangements, and the respective Underwriting Agreements, are
summarized in the section headed “Underwriting” in this Prospectus.
Admission of the H Shares into CCASS
All necessary arrangements have been made enabling the H Shares to be admitted into
CCASS.
If the Hong Kong Stock Exchange grants the listing of, and permission to deal in, the H
Shares and our Company complies 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 on the Hong
Kong Stock Exchange or any other date HKSCC chooses. Settlement of transactions between
participants of the Hong Kong 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.
STRUCTURE OF THE GLOBAL OFFERING
– 509 –


--- page 519 ---
CONDITIONS OF THE GLOBAL OFFERING
Acceptance of all applications for Offer Shares will be conditional on:
(i) the Listing Committee granting approval for the listing of, and permission to deal in,
the H Shares to be issued pursuant to the Global Offering (including the additional
Offer Shares which may be made available pursuant to the exercise of the
Over-allotment Option);
(ii) the execution and delivery of the International Underwriting Agreement on or
around Monday, July 8, 2024; and
(iii) the obligations of the Underwriters under each of the respective Underwriting
Agreements becoming and remaining unconditional and not having been terminated
in accordance with the terms of the respective agreements.
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 times and dates specified,
the Global Offering will lapse and the Hong Kong 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 the Stock Exchange and our Company on the next day following
such lapse. In such eventuality, 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” in this
Prospectus. In the meantime, all application monies will be held in (a) separate bank account(s)
with the receiving bank(s) or other licensed bank(s) in Hong Kong licensed under the Banking
Ordinance (Chapter 155 of the Laws of Hong Kong) (as amended).
H Share certificates will only become valid evidence of title at 8:00 a.m. on Wednesday,
July 10, 2024, provided that the Global Offering has become unconditional in all respects and
the right of termination as described in the section headed “Underwriting – Underwriting
Arrangements – Hong Kong Public Offering – Grounds for Termination” in this prospectus has
not been exercised 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 Wednesday, July 10, 2024, it is expected that dealings in the H Shares
on the Hong Kong Stock Exchange will commence at 9:00 a.m. on Wednesday, July 10, 2024.
The H Shares will be traded in board lots of 20 H Shares each and the stock code of the
H Shares will be 2495.
STRUCTURE OF THE GLOBAL OFFERING
– 510 –


--- page 520 ---
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.voicecomm.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
You 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, Supervisor or any of his/her close associates.
HOW TO APPLY FOR HONG KONG OFFER SHARES
–5 1 1–


--- page 521 ---
2. Application Channels
The Hong Kong Public Offering period will begin at 9:00 am on Friday, June 28,
2024 and end at 12:00 noon on Friday, July 5, 2024 (Hong Kong time).
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
Applicants 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 am on Friday,
June 28, 2024 to 11:30
a.m. on Friday, July 5,
2024, Hong Kong time.
The latest time for
completing full payment
of application monies will
be 12:00 noon on Friday,
July 5, 2024, Hong Kong
time.
HKSCC EIPO
channel
Your 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
Applicants 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
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--- page 522 ---
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 application 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
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--- page 523 ---
3. Information Required to Apply
You must provide the following information with your application:
For Individual/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. You 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 shares in the Hong
Kong Public Offering. 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.
1 Subject to change, if the Company’s Articles of Incorporation and applicable company law prescribe a lower
cap.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 514 –


--- page 524 ---
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.
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 : 20 H Shares
Permitted number of
Hong Kong
: 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.
Offer Shares for
application and
amount payable on
application/successful
allotment
: The Offer Price is HK$152.10 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
– 515 –


--- page 525 ---
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 Shares you have selected. You must pay
the respective maximum amount payable on application in
full upon application for Hong Kong Offer Shares.
Shanghai Voicecomm Information Technology Co., Ltd.
(HK$ 152.10 per Hong Kong Offer Share)
NUMBER OF HONG KONG OFFER SHARES THAT MAY BE APPLIED
FOR AND PAYMENTS
No. of
Hong Kong
Offer Shares
applied for
Amount
payable on
application (2)
No. of
Hong Kong
Offer Shares
applied for
Amount
payable on
application (2)
No. of
Hong Kong
Offer Shares
applied for
Amount
payable on
application (2)
No. of
Hong Kong
Offer Shares
applied for
Amount
payable on
application (2)
HK$ HK$ HK$ HK$
20 3,072.67 400 61,453.57 6,000 921,803.57 80,000 12,290,714.28
40 6,145.35 500 76,816.96 7,000 1,075,437.51 90,000 13,827,053.56
60 9,218.04 600 92,180.36 8,000 1,229,071.43 100,000 15,363,392.86
80 12,290.72 700 107,543.75 9,000 1,382,705.35 120,000 18,436,071.42
100 15,363.39 800 122,907.14 10,000 1,536,339.29 140,000 21,508,749.99
120 18,436.07 900 138,270.54 20,000 3,072,678.56 160,000 24,581,428.55
140 21,508.74 1,000 153,633.93 30,000 4,609,017.85 180,000 27,654,107.14
160 24,581.43 2,000 307,267.86 40,000 6,145,357.15 218,280
(1) 33,535,213.91
180 27,654.11 3,000 460,901.78 50,000 7,681,696.43
200 30,726.79 4,000 614,535.71 60,000 9,218,035.71
300 46,090.18 5,000 768,169.64 70,000 10,754,375.00
(1) Maximum number of Hong Kong Offer Shares 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).
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 526 ---
5. Multiple Applications Prohibited
You 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. Application 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
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
– 517 –


--- page 527 ---
(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
2, 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 “ – G. Personal Data – 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 You 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;
2 Relevant Persons would include the Sole Sponsor, the Joint Global Coordinators, the Joint Bookrunners, the
Joint Lead Managers, the Underwriters, any of their or the Company’s respective directors, officers,
employees, partners, agents, advisers and any other parties involved in the Global Offering.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 528 ---
(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;
(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 the 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 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 application channel of
the H Share Registrar 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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B. PUBLICATION OF RESULTS
Results of Allocation
You 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” function.
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 ).
24 hours, from 11:00 p.m. Tuesday,
July 9, 2024 to 12:00 midnight
Monday, July 15, 2024 (Hong
Kong time)
The Stock Exchange’s website at
www.hkexnews.hk and our website at
www.voicecomm.cn which will provide
links to the above mentioned websites of
the H Share Registrar.
No later than 11:00 p.m. on
Tuesday, July 9, 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 Wednesday, July 10, 2024 to
Monday, July 15, 2024
(Hong Kong time) (excluding
Saturday, Sunday and public
holidays in Hong Kong)
For those applying through HKSCC EIPO channel, you may also check with your broker
or custodian from 6:00 p.m. on Monday, July 8, 2024 (Hong Kong time).
HKSCC Participants can log into FINI and review the allotment result from 6:00 p.m. on
Monday, July 8, 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 530 ---
Allocation Announcement
We expect to announce the results of the Offer Price, the level of indications of interest
in the Global Offer, 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.voicecomm.cn by no later than 11:00 p.m. on
Tuesday, July 9, 2024 (Hong Kong time).
C. CIRCUMSTANCES IN WHICH YOU WILL NOT BE ALLOCATED HONG KONG
OFFER SHARES
You 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:
Your 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 the 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. You may refer to
the paragraph headed “ – A. Application 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 531 ---
 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 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
banks 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
You 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 Share certificates will be deposited into CCASS as described
below).
No temporary document of title will be issued in respect of the 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 Wednesday,
July 10, 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 Shares prior to the receipt of Share certificates or the Share certificates
becoming valid do so entirely at their own risk.
The right is reserved to retain any Share certificate(s) and (if applicable) any surplus
application monies pending clearance of application monies.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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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
equal or over
100,000 Hong
Kong Offer Shares
issued under your
own name
Collection in person from the
H Share Registrar, Computershare
Hong Kong Investor Services
Limited at 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 Wednesday, July 10, 2024
(Hong Kong time)
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.
Note: If you do not collect your
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
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
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 after a super typhoon in force in Hong Kong in the morning on
Tuesday, July 9, 2024 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 share certificates in accordance with the contingency arrangements as agreed between them.
You may refer to “ – E. Severe Weather Arrangements ” in this section.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 533 ---
White Form eIPO service HKSCC EIPO channel
For physical share
certificates of less
than 100,000 Hong
Kong Offer Shares
issued under your
own name
Your H Share certificate(s) will be
sent to the address specified in
your application instructions by
ordinary post at your own risk
Time: Tuesday, July 9, 2024
Refund mechanism for surplus application monies paid by you
Date Wednesday, July 10, 2024 Subject to the arrangement between
you and your broker or custodian
Responsible party H Share Registrar Your broker or custodian
Application monies
paid through single
bank account
e-Refund payment instructions to
your designated bank account
Your 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
E. SEVERE WEATHER ARRANGEMENTS
The Opening and Closing of the Application Lists
The application lists will not open or close on Friday, July 5, 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 Friday, July 5, 2024.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 534 ---
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.voicecomm.cn of the revised timetable.
If a Severe Weather Signal is hoisted on Tuesday, July 9, 2024, the H Share Registrar will
make appropriate arrangements for the delivery of the share certificates to the CCASS
Depository’s service counter so that they would be available for trading on Wednesday, July 10,
2024, and for physical 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 canceled (e.g. in the afternoon of Tuesday, July 9, 2024
or on Wednesday, July 10, 2024.
If a Severe Weather Signal is hoisted on Wednesday, July 10, 2024, for physical share
certificates of equal or over 100,000 Offer Shares issued under your own name, you may
collect your share certificates from the H Share Registrar’s office after the Severe Weather
Signal is lowered or canceled (e.g. in the afternoon of Wednesday, July 10, 2024 or on
Thursday, July 11, 2024.
Prospective investors should be aware that if they choose to receive physical share
certificates issued in their own name, there may be a delay in receiving the share
certificates.
F. ADMISSION OF THE H SHARES INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the Shares on the
Stock Exchange and we comply with the stock admission requirements of HKSCC, the 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 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 Shares to be admitted into
CCASS.
You 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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 535 ---
G. PERSONAL DATA
The following Personal Information Collection Statement applies to any personal data
collected and held by the Company, the H Share Registrar, the receiving banks 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 the 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.
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 Share certificate(s) to which you are entitled.
It is important that applicants for and holders of Hong Kong Offer Shares inform the
Company and the H Share Registrar immediately of any inaccuracies in the personal data
supplied.
3. Purposes
Your 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
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;
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 536 ---
 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
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 Shares and identifying any
duplicate applications for the Shares;
 facilitating Hong Kong Offer Shares balloting;
 establishing benefit entitlements of holders of the Shares, such as dividends, rights
issues, bonus issues, etc.;
 distributing communications from the Company and its subsidiaries;
 compiling statistical information and profiles of the holder of the 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 Shares and/or regulators and/or any other purposes to which
applicants and holders of the Shares may from time to time agree.
4. Transfer of personal data
Personal data held by the Company and the H Share Registrar relating to the applicants
for and holders of Hong Kong Offer Shares will be kept confidential but the 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:
 the Company’s appointed agents such as financial advisers, receiving banks 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);
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 537 ---
 any agents, contractors or third-party service providers who offer administrative,
telecommunications, computer, payment or other services to the 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
The 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
the 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. The 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 the 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
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--- page 538 ---
The following is the text of a report set out on pages I-1 to I-88, received from the
Company’ s reporting accountants, KPMG, Certified Public Accountants, Hong Kong, for the
purpose of incorporation in this prospectus.
ACCOUNTANTS’ REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE
DIRECTORS OFʮ̡ SHANGHAI VOICECOMM
INFORMATION TECHNOLOGY CO., LTD.* AND CHINA INTERNATIONAL
CAPITAL CORPORATION HONG KONG SECURITIES LIMITED
Introduction
We report on the historical financial information ofʮ̡
Shanghai V oicecomm Information Technology Co., Ltd.* (the “Company”) and its subsidiaries
(together, the “Group”) set out on pages I-4 to I-88, which comprises the consolidated
statements of financial position of the Group and the statements of financial position of the
Company as at 31 December 2021, 2022 and 2023, and the consolidated statements of profit
or loss, 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, for
each of the years ended 31 December 2021, 2022 and 2023 (the “Track Record Periods”), and
material accounting policies information and other explanatory information (together, the
“Historical Financial Information”). The Historical Financial Information set out on pages I-4
to I-88 forms an integral part of this report, which has been prepared for inclusion in the
prospectus of the Company dated 28 June 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.
Directors’ responsibility for the Historical Financial Information
The directors of the Company are responsible for the preparation of Historical Financial
Information that gives a true and fair view in accordance with the basis of preparation and
presentation set out in Note 1 to the Historical Financial Information, and for such internal
control as the directors of the Company 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 the 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.
* For identification purpose only.
APPENDIX I ACCOUNTANTS’ REPORT
– I-1 –


--- page 539 ---
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’ judgement, 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 the Historical Financial Information that gives a true and fair view in accordance
with the basis of preparation and presentation set out in Note 1 to the Historical Financial
Information in order 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, 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 purpose of the
accountants’ report, a true and fair view of the Company’s and the Group’s financial position
as at 31 December 2021, 2022 and 2023 and of the Group’s financial performance and cash
flows for the Track Record Periods in accordance with the basis of preparation and presentation
set out in Note 1 to the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-2 –


--- page 540 ---
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 29(b) to the Historical Financial Information which states that no
dividends have been paid by the Company in respect of the Track Record Periods.
KPMG
Certified Public Accountants
8th Floor, Prince’s Building
10 Chater Road
Central, Hong Kong
28 June 2024
APPENDIX I ACCOUNTANTS’ REPORT
– I-3 –


--- page 541 ---
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 Periods, on
which the Historical Financial Information is based, were audited by KPMG Huazhen LLP
Shanghai Branch (ה(౷ஷΥྫ)הin accordance with
Hong Kong Standards on Auditing issued by the HKICPA (the “Underlying Financial
Statements”).
APPENDIX I ACCOUNTANTS’ REPORT
– I-4 –


--- page 542 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
(Expressed in RMB)
Y ear ended 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Revenue 4 459,935 514,992 813,017
Cost of revenue (307,773) (313,526) (487,600)
Gross Profit 152,162 201,466 325,417
Other revenue 5(a) 7,692 11,016 27,226
Other net gain/(loss) 5(b) 200 (16) (25)
Research and development expenses (36,310) (63,983) (98,798)
Selling and marketing expenses (3,162) (7,249) (10,347)
Administrative and other operating
expenses (24,552) (31,486) (58,499)
Impairment loss on trade receivables (17,444) (42,562) (55,379)
Profit from operations 78,586 67,186 129,595
Net finance costs 6(a) (8,183) (9,034) (11,696)
Changes in carrying amount of
redeemable capital contributions 26 (25,950) (157,504) (146,892)
Changes in fair value of financial
assets measured at fair value
through profit or loss 18 – 8,337 258
Share of (loss)/gain of associates 16 (22) 131 (20)
Profit/(loss) before taxation 6 44,431 (90,884) (28,755)
Income tax 7 (8,047) 5,073 (446)
Profit/(loss) for the year 36,384 (85,811) (29,201)
Attributable to
Equity shareholders of the Company 36,895 (87,155) (33,754)
Non-controlling interests (511) 1,344 4,553
Profit/(loss) for the year 36,384 (85,811) (29,201)
Earnings/(loss) per share
Basic and diluted (RMB) 10 1.61 (3.33) (1.13)
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-5 –


--- page 543 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
(Expressed in RMB)
Y ear ended 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Profit/(loss) for the year 36,384 (85,811) (29,201)
Other comprehensive income for the
year (after tax and reclassification
adjustments)
Item that will not be reclassified to
profit or loss:
Equity investments at FVOCI – net
movement in fair value reserves
(non-recycling) 17 (84) 37 180
Other comprehensive income for
the year (84) 37 180
Total comprehensive income for
the year 36,300 (85,774) (29,021)
Attributable to:
Equity shareholders of the Company 36,811 (87,118) (33,574)
Non-controlling interests (511) 1,344 4,553
Total comprehensive income for
the year 36,300 (85,774) (29,021)
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-6 –


--- page 544 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Expressed in RMB)
As at 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current assets
Property and equipment 11 4,973 64,530 96,647
Right-of-use assets 12 7,702 10,694 14,616
Intangible assets 13 24,236 110,950 110,682
Goodwill 15 17,111 39,168 39,168
Interests in associates 16 360 2,041 230
Equity securities designated at fair
value through other comprehensive
income (FVOCI) 17 516 560 771
Financial assets measured at fair value
through profit or loss (FVPL) 18 20,000 28,337 28,595
Prepayments 20 72,909 34,360 179,956
Deferred tax assets 27(b) 5,184 10,038 18,399
152,991 300,678 489,064----------- ----------- -----------
Current assets
Inventories and other contract costs 19 112,475 95,269 7,653
Trade and other receivables 20 242,812 339,674 602,705
Prepayments 20 95,296 139,219 233,834
Cash 21(a) 10,641 20,434 46,876
461,224 594,596 891,068----------- ----------- -----------
Current liabilities
Trade and other payables 22 46,518 59,433 43,389
Contract liabilities 23 26,732 31,127 97,423
Bank loans and other borrowings 24 150,663 211,650 342,000
Lease liabilities 25 2,302 4,128 8,115
Taxation payable 27(a) 2,897 2,890 3,169
Redeemable capital contributions 26 265,666 527,970 852,912
494,778 837,198 1,347,008-----------
----------- -----------
Net current liabilities (33,554) (242,602) (455,940)----------- ----------- -----------
Total assets less current liabilities 119,437 58,076 33,124----------- ----------- -----------
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-7 –


--- page 545 ---
As at 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current liabilities
Bank loans and other borrowings 24 – 10,000 10,000
Lease liabilities 25 6,614 8,589 10,684
Deferred tax liabilities 27(b) 2,016 3,973 2,832
Deferred income 28 1,047 871 2,036
9,677 23,433 25,552----------- ----------- -----------
NET ASSETS 109,760 34,643 7,572
CAPITAL AND RESERVES
Share capital 29 25,670 28,290 31,059
Reserves 29 81,389 (8,349) (42,742)
Total equity/(deficit) attributable to
equity shareholders of the
Company 107,059 19,941 (11,683)
Non-controlling interests 2,701 14,702 19,255
TOTAL EQUITY 109,760 34,643 7,572
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-8 –


--- page 546 ---
STATEMENTS OF FINANCIAL POSITION OF THE COMPANY
(Expressed in RMB)
As at 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current assets
Property and equipment 11 4,963 57,356 84,843
Right-of-use assets 12 6,300 4,764 4,962
Intangible assets 13 11,703 61,731 70,994
Interests in subsidiaries 14 38,106 66,766 74,439
Interests in associates 16 360 2,041 230
Equity securities designated at fair
value through other comprehensive
income (FVOCI) 17 516 560 771
Financial assets measured at fair value
through profit or loss (FVPL) 18 20,000 28,337 28,595
Prepayments 20 52,333 20,396 163,086
Deferred tax assets 27(b) 4,803 7,005 5,211
139,084 248,956 433,131----------- ----------- -----------
Current assets
Inventories and other contract costs 19 108,172 90,965 6,164
Trade and other receivables 20 243,747 362,625 637,334
Prepayments 20 94,259 139,201 226,537
Cash 21(a) 10,289 14,320 38,364
456,467 607,111 908,399----------- ----------- -----------
Current liabilities
Trade and other payables 22 42,001 53,539 33,901
Contract liabilities 23 26,732 31,127 96,941
Bank loans and other borrowings 24 150,663 211,650 340,000
Lease liabilities 25 1,565 1,631 1,752
Taxation payable – – 195
Redeemable capital contributions 26 265,666 527,970 852,912
486,627 825,917 1,325,701-----------
----------- -----------
Net current liabilities (30,160) (218,806) (417,302)----------- ----------- -----------
Total assets less current liabilities 108,924 30,150 15,829----------- ----------- -----------
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-9 –


--- page 547 ---
As at 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current liabilities
Lease liabilities 25 5,566 3,935 3,983
Deferred income 28 1,047 871 2,036
6,613 4,806 6,019----------- ----------- -----------
NET ASSETS 102,311 25,344 9,810
CAPITAL AND RESERVES
Share capital 29 25,670 28,290 31,059
Reserves 76,641 (2,946) (21,249)
TOTAL EQUITY 102,311 25,344 9,810
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-10 –


--- page 548 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(Expressed in RMB)
Attributable to equity shareholders of the Group
Note
Share
capital
Capital
reserve
PRC
statutory
reserves
Fair value
reserve
(non-
recycling)
Retained
earnings Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Balance at
1 January 2021 22,160 (4,819) 5,343 98 47,466 70,248 51 70,299------ ------ ------ ------- ------ ------ -------- ------
Changes in equity for
2021
Profit/(loss) for the year – – – – 36,895 36,895 (511) 36,384
Other comprehensive
income for the year – – – (84) – (84) – (84)
Total comprehensive
income for the year – – – (84) 36,895 36,811 (511) 36,300------ ------ ------ ------- ------ ------ -------- ------
Non-controlling
interests arising from
business combination 34 – – – – – – 3,161 3,161
Issue of ordinary shares 29(c) 3,510 136,890 – – – 140,400 – 140,400
Recognition of
redeemable capital
contributions as
current liabilities 26 – (140,400) – – – (140,400) – (140,400)
Appropriation for
surplus reserve – – 3,152 – (3,152) – – –------
------ ------ ------- ------ ------ -------- ------
Balance at
31 December 2021 25,670 (8,329) 8,495 14 81,209 107,059 2,701 109,760
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-11 –


--- page 549 ---
Attributable to equity shareholders of the Group
Note
Share
capital
Capital
reserve
PRC
statutory
reserves
Fair value
reserve
(non-
recycling)
Retained
earnings Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Balance at
31 December 2021 and
1 January 2022 25,670 (8,329) 8,495 14 81,209 107,059 2,701 109,760------
------ ------ ------- ------ ------ -------- ------
Changes in equity for
2022
(Loss)/profit for the year – – – – (87,155) (87,155) 1,344 (85,811)
Other comprehensive
income – – – 37 – 37 – 37
Total comprehensive
income for the year – – – 37 (87,155) (87,118) 1,344 (85,774)------
------ ------ ------- ------ ------ -------- ------
Non-controlling interests
arising from business
combination 34 – – – – – – 5,757 5,757
Capital contribution from
non-controlling interests – – – – – – 4,900 4,900
Issue of ordinary shares 29(c) 2,620 102,180 – – – 104,800 – 104,800
Recognition of redeemable
capital contributions as
current liabilities 26 – (104,800) – – – (104,800) – (104,800)------ ------ ------ ------- ------ ------ -------- ------
Balance at
31 December 2022 28,290 (10,949) 8,495 51 (5,946) 19,941 14,702 34,643
Balance at
31 December 2022 and
1 January 2023 28,290 (10,949) 8,495 51 (5,946) 19,941 14,702 34,643------
------ ------ ------- ------ ------ -------- ------
(Loss)/profit for the year – – – – (33,754) (33,754) 4,553 (29,201)
Other comprehensive
income – – – 180 – 180 – 180
Total comprehensive
income for the year – – – 180 (33,754) (33,574) 4,553 (29,021)------ ------ ------ ------- ------ ------ -------- ------
Issue of ordinary shares 29(c) 2,769 177,231 – – – 180,000 – 180,000
Recognition of redeemable
capital contributions as
current liabilities 26 – (178,050) – – – (178,050) – (178,050)------
------ ------ ------- ------ ------ -------- ------
Balance at 31 December
2023 31,059 (11,768) 8,495 231 (39,700) (11,683) 19,255 7,572
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-12 –


--- page 550 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in RMB)
Y ears ended 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Operating activities
Cash used in operations 21(b) (58,750) (23,234) (66,615)
Tax paid 27(a) (16,328) (7,880) (1,454)
Net cash used in operating activities (75,078) (31,114) (68,069)----------- ----------- -----------
Investing activities
Payment for the acquisition of
property and equipment (56,579) (19,810) (151,112)
Payment for the acquisition of
intangible assets (13,093) (102,593) (31,802)
Acquisition of subsidiary, net of cash
acquired 21(e) (20,400) (16,755) (3,295)
Payment for investment in financial
assets measured at FVPL (20,000) – –
Proceeds from disposal of interests in
an associate 2,200 – 2,000
Payment for investments in interests in
associates (300) (1,550) (250)
Interest received from bank deposits 30 31 73
Net cash used in investing activities (108,142) (140,677) (184,386)
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-13 –


--- page 551 ---
Y ears ended 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Financing activities
Proceeds from bank loans and other
borrowings 21(c) 147,161 193,666 312,000
Repayment of bank loans and other
borrowings 21(c) (94,499) (122,679) (181,650)
Proceeds from related parties loans 21(c) 5,000 – –
Repayment of related parties loans 21(c) (2,000) (3,000) –
Proceeds from non-controlling
interests shareholder 21(c) – 4,900 –
Interest element of lease rentals paid 21(c) (374) (403) (637)
Capital element of lease rentals paid 21(c) (1,130) (1,444) (1,958)
Proceeds from redeemable capital
contributions 21(c) 140,400 104,800 161,295
Payment for capitalization of listing
expenses 21(c) – – (971)
Capital contribution from investors 21(c) – 16,755 1,950
Interest paid 21(c) (7,839) (11,011) (11,132)
Net cash generated from financing
activities 186,719 181,584 278,897----------- ----------- -----------
Net increase in cash 3,499 9,793 26,442
Cash at the beginning of the year 21(a) 7,142 10,641 20,434
Cash at the end of the year 21(a) 10,641 20,434 46,876
The accompanying notes form part of the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-14 –


--- page 552 ---
NOTES TO THE HISTORICAL FINANCIAL INFORMATION
1 BASIS OF PREPARATION AND PRESENTATION OF HISTORICAL FINANCIAL INFORMATION
Shanghai V oicecomm Information Technology Co., Ltd. (the “Company”) was incorporated in the People’s
Republic of China (the “PRC”) on 5 December 2005 as a limited liability company under the Company Law of the
PRC, with its registered office at Unit 418, Building 2, No. 508, Chundong Road, Minhang District, Shanghai. Upon
approval by the Company’s board meeting held on 26 April 2015, the Company was converted from a limited liability
company into a joint stock limited liability company.
The Company and its subsidiaries (collectively referred to as “the Group”) are principally engaged in the
provision of enterprise-level solutions including audio and video communication hardware and software to enterprise
customers. The Group’s principal operations and geographic markets are in the People’s Republic of China (“PRC”).
The information of the subsidiaries is set out in Note 14.
The Historical Financial Information has been prepared assuming the Group will continue as a going concern
notwithstanding that the Group recorded net current liabilities of RMB455,940,000 as at 31 December 2023, which
is primarily due to redeemable capital contributions totaling RMB852,912,000 are classified as current liabilities (see
Note 26). As at 31 December 2023, certain conditions associated with redemption rights attributable to the investors
in Series A, Series B, Series B+ and Series C Financing (as defined and detailed in Note 26 were met, based on the
IPO filling schedule, the directors of the Company are of the opinion that the holders of pre-IPO Investments (as
defined in Note 2(p)) will not request the Company to redeem these investments within the next twelve months from
31 December 2023 and the related redemption options would be terminated and the financial instruments issued to
investors would be converted into equity upon the qualified initial public offering of the Company’s shares on the
Stock Exchange. Taken the above into consideration, and together with cashflow forecast for the twelve months
ending 31 December 2024 prepared by management of the Group, the directors of the Company are of the opinion
that the Group will have sufficient working capital, to meet its financial liabilities and obligations as and when they
fall due and to sustain its operations for the next 12 months from 31 December 2023.
The Historical Financial Information has been prepared in accordance with all applicable International
Financial Reporting Standards (“IFRSs”) which collective term includes all applicable individual International
Financial Reporting Standards, International Accounting Standards (“IASs”) and Interpretations issued by the
International Accounting Standards Board (“IASB”). Further details of the material accounting policies information
are set out in Note 2.
The IASB has issued a number of new and revised IFRSs. For the purpose of preparing this Historical Financial
Information, the Group has adopted all applicable new and revised IFRSs to the Track Record Periods, expect for any
new standards or interpretations that are not yet effective for the Track Record Periods. The revised and new
accounting standards and interpretations issued but not yet effective for the Track Record Periods are set out in Note
36.
The Historical Financial Information also complies with the applicable disclosure provisions of the Rules
Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”).
The accounting policies set out below have been applied consistently to all periods presented in the Historical
Financial Information.
The Historical Financial Information is presented in Renminbi (“RMB”) and all values are rounded to the
nearest thousand yuan (RMB’000) except when otherwise indicated.
2 MATERIAL ACCOUNTING POLICIES INFORMATION
(a) Basis of measurement
The measurement basis used in the preparation of the financial statements is the historical cost basis except
that the following assets and liabilities are stated at their fair value as explained in the accounting policies set out
below:
– investments in debt and equity securities (see Note 2(f)).
APPENDIX I ACCOUNTANTS’ REPORT
– I-15 –


--- page 553 ---
(b) Use of estimates and judgements
The preparation of financial statements in conformity with IFRSs requires management to make judgements,
estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income
and expenses. The estimates and associated assumptions are based on historical experience and various other factors
that are believed to be reasonable under the circumstances, the results of which form the basis of making the
judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual
results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised 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 the revision affects both current and future periods.
Judgements made by management in the application of IFRSs that have significant effect on the financial
statements and major sources of estimation uncertainty are discussed in Note 3.
(c) Subsidiaries and non-controlling interests
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has
rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its
power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements
from the date on which control commences until the date on which control ceases.
Intra-group balances and transactions, and any unrealised income and expenses (except for foreign currency
transaction gains or losses) arising from intra-group transactions, are eliminated. Unrealised losses resulting from
intra-group transactions are eliminated in the same way as unrealised gains, but only to the extent that there is no
evidence of impairment.
For each business combination, the Group can elect to measure any non-controlling interests (“NCI”) either
at fair value or at the NCI’s proportionate share of the subsidiary’s net identifiable assets.
NCI are presented in the consolidated statement of financial position within equity, separately from equity
attributable to the equity shareholders of the Company. NCI in the results of the Group are presented on the face of
the consolidated statement of profit or loss and the consolidated statement of profit or loss and other comprehensive
income as an allocation of the total profit or loss and total comprehensive income for the year between NCI and the
equity shareholders of the Company. Loans from holders of NCI and other contractual obligations towards these
holders are presented as financial liabilities in the consolidated statement of financial position in accordance with
Notes 2(o) or 2(r) depending on the nature of the liability.
Changes in the Group’s interests in a subsidiary that do not result in a loss of control are accounted for as
equity transactions.
When the Group loses control of a subsidiary, it derecognises the assets and liabilities of the subsidiary, and
any related NCI and other components of equity. Any resulting gain or loss is recognised in profit or loss. Any interest
retained in that former subsidiary is measured at fair value when control is lost.
In the Company’s statement of financial position, an investment in a subsidiary is stated at cost less impairment
losses (see Note 2(j)(ii)), unless it is classified as held for sale (or included in a disposal group classified as held for
sale).
(d) Associates
An associate is an entity in which the Group or the company has significant influence, but not control or joint
control, over the financial and operating policies.
An interest in an associate is accounted for using the equity method, unless it is classified as held for sale (or
included in a disposal group classified as held for sale). They are initially recognised at cost, which includes
transaction costs. Subsequently, the consolidated financial statements include the Group’s share of the profit or loss,
and other comprehensive income (“OCI”) of those investees, until the date on which significant influence ceases.
APPENDIX I ACCOUNTANTS’ REPORT
– I-16 –


--- page 554 ---
When the Group’s share of losses exceeds its interest in the associate, the Group’s interest is reduced to nil
and recognition of further losses is discontinued except to the extent that the Group has incurred legal or constructive
obligations or made payments on behalf of the investee. For this purpose, the Group’s interest is the carrying amount
of the investment under the equity method, together with any other long-term interests that in substance form part
of the Group’s net investment in the associate, after applying the ECL model to such other long-term interests where
applicable (see Note 2(j)(i)).
Unrealised gains arising from transactions with equity-accounted investees are eliminated against the
investment to the extent of the Group’s interest in the investee. Unrealised losses are eliminated in the same way as
unrealised gains, but only to the extent there is no evidence of impairment.
In the company’s statement of financial position, an investment in an associate is stated at cost less impairment
losses (see Note 2(j)), unless it is classified as held for sale (or included in a disposal group classified as held for
sale).
(e) Goodwill
Goodwill arising on acquisition of businesses is measured at cost less accumulated impairment losses and is
tested annually for impairment (see Note 2(j)(ii)).
(f) Other investments in securities
The Group’s policies for investments in securities, other than investments in subsidiaries and associates, are
set out below:
Investments in securities are recognised/derecognised on the date the Group commits to purchase/sell the
investment. The investments are initially stated at fair value plus directly attributable transaction costs, except for
those investments measured at FVPL for which transaction costs are recognised directly in profit or loss. For an
explanation of how the Group determines fair value of financial instruments, see Note 30. These investments are
subsequently accounted for as follows, depending on their classification.
(i) Non-equity investments
Non-equity investments are classified into one of the following measurement categories:
– Amortised cost, if the investment is held for the collection of contractual cash flows which
represent solely payments of principal and interest. Expected credit losses, interest income
calculated using the effective interest method (see Note 2(w)), foreign exchange gains and losses
are recognised in profit or loss. Any gain or loss on derecognition is recognised in profit or loss.
– FVOCI – recycling, if the contractual cash flows of the investment comprise solely payments of
principal and interest and the investment is held within a business model whose objective is
achieved by both the collection of contractual cash flows and sale. Expected credit losses, interest
income (calculated using the effective interest method) and foreign exchange gains and losses are
recognised in profit or loss and computed in the same manner as if the financial asset was
measured at amortised cost. The difference between the fair value and the amortised cost is
recognised in OCI. When the investment is derecognised, the amount accumulated in OCI is
recycled from equity to profit or loss.
– FVPL if the investment does not meet the criteria for being measured at amortised cost or FVOCI
(recycling). Changes in the fair value of the investment (including interest) are recognised in
profit or loss.
(ii) Equity investments
An investment in equity securities is classified as FVPL unless the investment is not held for trading
purposes and on initial recognition the Group makes an irrevocable election to designate the investment at
FVOCI (non-recycling) such that subsequent changes in fair value are recognised in OCI. Such elections are
made on an instrument-by-instrument basis but may only be made if the investment meets the definition of
equity from the issuer’s perspective. If such election is made, for a particular investment, at the time of
disposal, the amount accumulated in the fair value reserve (non-recycling) is transferred to retained earnings
and not recycled through profit or loss. Dividends from an investment in equity securities, irrespective of
whether classified as at FVPL or FVOCI, are recognised in profit or loss as other income.
APPENDIX I ACCOUNTANTS’ REPORT
– I-17 –


--- page 555 ---
(g) Property and equipment
The following items of property and equipment are stated at cost, which includes capitalised borrowing costs,
less accumulated depreciation and any accumulated impairment losses (see Note 2(j)):
– right-of-use assets arising from leasehold properties where the group is not the registered owner of the
property interest; and
– items of plant and equipment, including right-of-use assets arising from leases of underlying plant and
equipment (see Note 2(i)).
If significant parts of an item of property, plant and equipment have different useful lives, then they are
accounted for as separate items (major components).
Any gain or loss on disposal of an item of property and equipment is recognised in profit or loss.
Depreciation is calculated to write off the cost of items of property and equipment, less their estimated residual
values, if any, using the straight-line method over their estimated useful lives, and is generally recognised in profit
or loss.
The estimated useful lives for the current and comparative periods are as follows:
Electronic equipment 3 years
Furniture 5 years
Servers 5 years
Vehicles 4 years
Leasehold improvements Shorter of estimated useful life and remaining lease
terms
Right-of-use assets Over the lease term
Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if
appropriate.
Construction in progress represents properties under construction and machinery and equipment pending
installation and is stated at cost less impairment losses (see Note 2(j)(ii)). Cost comprises the purchase costs of the
asset and the related construction and installation costs.
Construction in progress is transferred to property and equipment when the asset is substantially ready for its
intended use and depreciation will be provided at the appropriate rates in accordance with the depreciation policies
specified above.
No depreciation is provided in respect of construction in progress.
(h) Intangible assets (other than goodwill)
Intangible assets (other than goodwill) that are acquired by the Group and have finite useful lives are measured
at cost less accumulated amortization and any accumulated impairment losses (see Note 2(j)(ii)).
Amortisation is calculated to write off the cost of intangible assets less their estimated residual values using
the straight-line method over their estimated useful lives, if any, and is generally recognised in profit or loss.
The estimated useful lives for the current and comparative periods are as follow:
Software 5 years
Patents 8 years
Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if
appropriate.
APPENDIX I ACCOUNTANTS’ REPORT
– I-18 –


--- page 556 ---
(i) Leased assets
At inception of a contract, the Group assesses whether the contract is, or contains, a lease. This is the case if
the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration. Control is conveyed where the customer has both the right to direct the use of the identified asset and
to obtain substantially all of the economic benefits from that use.
(i) As a lessee
Where the contract contains lease components and non-lease components, the Group has elected not to
separate non-lease components and accounts for each lease component and any associated non-lease
components as a single lease component for all leases.
At the lease commencement date, the Group recognises a right-of-use asset and a lease liability, except
for leases that have a short lease term of 12 months or less, and leases of low-value items. When the Group
enters into a lease in respect of a low-value item, the Group decides whether to capitalise the lease on a
lease-by-lease basis. If not capitalized, the associated lease payments are recognised in profit or loss on a
systematic basis over the lease term.
Where the lease is capitalised, the lease liability is initially recognised at the present value of the lease
payments payable over the lease term, discounted using the interest rate implicit in the lease or, if that rate
cannot be readily determined, using a relevant incremental borrowing rate. After initial recognition, the lease
liability is measured at amortised cost and interest expense is recognized using the effective interest method.
Variable lease payments that do not depend on an index or rate are not included in the measurement of the lease
liability, and are charged to profit or loss as incurred.
The right-of-use asset recognised when a lease is capitalised is initially measured at cost, which
comprises the initial amount of the lease liability adjusted for any lease payments made at or before the
commencement date, and plus any initial direct costs incurred and an estimate of costs to dismantle and remove
the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives
received. The right-of-use asset is subsequently stated at cost less accumulated depreciation and impairment
losses (see Note 2(j)(ii)).
Refundable rental deposits are accounted for separately from the right-of-use assets in accordance with
the accounting policy applicable to investments in non-equity securities carried at amortised cost. Any excess
of the nominal value over the initial fair value of the deposits is accounted for as additional lease payments
made and is included in the cost of right-of-use assets.
The lease liability is remeasured when there is a change in future lease payments arising from a change
in an index or rate, if there is a change in the Group’s estimate of the amount expected to be payable under
a residual value guarantee, or if the Group changes its assessment of whether it will exercise a purchase,
extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment
is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount
of the right-of-use asset has been reduced to zero.
The lease liability is also remeasured when there is a lease modification, which means a change in the
scope of a lease or the consideration for a lease that is not originally provided for in the lease contract, if such
modification is not accounted for as a separate lease. In this case the lease liability is remeasured based on the
revised lease payments and lease term using a revised discount rate at the effective date of the modification.
The only exceptions are rent concessions that occurred as a direct consequence of the COVID-19 pandemic
and met the conditions set out in paragraph 46B of IFRS 16 Leases . In such cases, the Group has taken
advantage of the practical expedient not to assess whether the rent concessions are lease modifications, and
recognised the change in consideration as negative variable lease payments in profit or loss in the period in
which the event or condition that triggers the rent concessions occurred.
In the consolidated statement of financial position, the current portion of long-term lease liabilities is
determined as the present value of contractual payments that are due to be settled within twelve months after
the reporting period.
APPENDIX I ACCOUNTANTS’ REPORT
– I-19 –


--- page 557 ---
(j) Credit losses and impairment of assets
(i) Credit losses from financial instruments
The Group recognises a loss allowance for expected credit losses (“ECL”s) on:
– financial assets measured at amortised cost (including cash, trade receivables and other
receivables, which are held for the collection of contractual cash flows which represent solely
payments of principal and interest).
Measurement of ECLs
ECLs are a probability-weighted estimate of credit losses. Generally, credit losses are measured
as the present value of all expected cash shortfalls between contractual and expected amounts.
The expected cash shortfalls are discounted using the following rates if the effect is material:
– fixed-rate financial assets and trade and other receivables: effective interest rate
determined at initial recognition or an approximation thereof;
– variable-rate financial assets: current effective interest rate.
The maximum period considered when estimating ECLs is the maximum contractual period over
which the Group is exposed to credit risk.
ECLs are measured on either of the following bases:
– 12-month ECLs: these are the portion of ECLs that result from default events that are
possible within the 12 months after the reporting date (or a shorter period if the expected
life of the instrument is less than 12 months); and
– lifetime ECLs: these are the ECLs that result from all possible default events over the
expected lives of the items to which the ECL model applies.
Loss allowances for trade receivables are always measured at an amount equal to lifetime ECLs.
Significant increases in credit risk
When determining whether the credit risk of a financial instrument has increased significantly
since initial recognition and when measuring 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 and analysis, based on the Group’s historical experience and informed credit
assessment, that includes 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 dates.
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 actions such as realising security (if any is held); or
– the financial asset is 90 days past due.
ECLs are remeasured at each reporting date to reflect changes in the financial instrument’s credit
risk since initial recognition. Any change in the ECL amount is recognised as an impairment gain or loss
in profit or loss. The Group recognises an impairment gain or loss for all financial instruments with a
corresponding adjustment to their carrying amount through a loss allowance account, except for
investments in non-equity securities that are measured at FVOCI (recycling), for which the loss
allowance is recognised in OCI and accumulated in the fair value reserve (recycling) does not reduce
the carrying amount of the financial asset in the statement of financial position.
APPENDIX I ACCOUNTANTS’ REPORT
– I-20 –


--- page 558 ---
Credit-impaired financial assets
At each reporting date, the Group assesses whether a financial asset is credit-impaired. A
financial asset is credit-impaired when one or more events that have a detrimental impact on the
estimated future cash flows of the financial asset have occurred.
Evidence that a financial asset is credit-impaired includes the following observable events:
– significant financial difficulties of the debtor;
– a breach of contract, such as a default or being more than 90 days past due;
– the restructuring of a loan or advance by the Group on terms that the Group would not
consider otherwise;
– it is probable that the debtor will enter bankruptcy or other financial reorganisation; or
– the disappearance of an active market for a security because of financial difficulties of the
issuer.
Write-off policy
The gross carrying amount of a financial asset is written off to the extent that there is no realistic
prospect of recovery. This is generally the case when the Group otherwise determines that the debtor
does not have assets or sources of income that could generate sufficient cash flows to repay the amounts
subject to the write-off.
Subsequent recoveries of an asset that was previously written off are recognised as a reversal of
impairment in profit or loss in the period in which the recovery occurs.
(ii) Impairment of other non-current assets
At each reporting date, the Group reviews the carrying amounts of its non-financial assets (other than
property carried at revalued amounts, investment property, inventories and other contract costs, contract assets
and deferred tax assets) to determine whether there is any indication of impairment.
If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill is tested
annually for impairment.
For impairment testing, assets are grouped together into the smallest group of assets that generates cash
inflows from continuing use that are largely independent of the cash inflows of other assets or cash-generating
units (“CGU”s). Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that
are expected to benefit from the synergies of the combination.
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs
of disposal. Value in use, is based on the estimated future cash flows 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.
An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its recoverable
amount.
Impairment losses are recognised in profit or loss. They are allocated first to reduce the carrying amount
of any goodwill allocated to the CGU and then to reduce the carrying amounts of the other assets in the CGU
on a pro rata basis.
An impairment loss in respect of goodwill is not reversed.
For other assets, an impairment loss is reversed only to the extent that the resulting carrying amount
does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if
no impairment loss had been recognised.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 559 ---
(k) Inventory and other contract costs
(i) Inventories
Inventories are electronic manufacturing which is measured at the lower of cost and net realizable.
Cost is calculated using the specific identification method and comprises all costs of purchase, costs of
conversion and other costs incurred in bringing the inventories to their present location and condition.
Net realisable value represents the estimated selling price in the ordinary course of business less the
estimated costs of completion and the estimated costs necessary to make the sale.
(ii) Other contract costs
Other contract costs are either the incremental costs of obtaining a contract with a customer or the costs
to fulfil a contract with a customer which are not capitalised as inventory (see Note 2(k)(i)), property, plant
and equipment (see Note 2(g)) or intangible assets (see Note 2(h)).
Incremental costs of obtaining a contract, e.g. sales commissions, are capitalised if the costs relate to
revenue which will be recognised in a future reporting period and the costs are expected to be recovered. Other
costs of obtaining a contract are expensed when incurred.
Costs to fulfil a contract are capitalised if the costs relate directly to an existing contract or to a
specifically identifiable anticipated contract; generate or enhance resources that will be used to provide goods
or services in the future; and are expected to be recovered. Otherwise, costs of fulfilling a contract, which are
not capitalised as inventory, property, plant and equipment or intangible assets, are expensed as incurred.
Capitalised contract costs are stated at cost less accumulated amortisation and impairment losses.
Amortisation of capitalised contract costs is recognised in profit or loss when the revenue to which the asset
relates is recognised (see Note 2(v)).
(l) Contract liabilities
A contract liability is recognised when the customer pays non-refundable consideration before the Group
recognises the related revenue (see Note 2(v)). A contract liability is also recognised if the Group has an
unconditional right to receive non-refundable consideration before the Group recognises the related revenue. In such
latter cases, a corresponding receivable would is also recognised (see Note 2(m)).
(m) Trade and other receivables
A receivable is recognised when the Group has an unconditional right to receive consideration and only the
passage of time is required before payment of that consideration is due.
Trade receivables that do not contain a significant financing component are initially measured at their
transaction price. Trade receivables that contain a significant financing component and other receivables are initially
measured at fair value plus transaction costs. All receivables are subsequently stated at amortised cost (see Note
2(j)(i)).
(n) Cash
Cash comprise cash at bank and on hand that are readily convertible into known amounts of cash and which
are subject to an insignificant risk of changes in value, having been within three months of maturity at acquisition.
Cash are assessed for ECL (see Note 2(j)(i)).
(o) Trade and other payables
Trade and other payables are initially recognised at fair value. Subsequently to initial recognition, trade and
other payables are stated at amortised cost unless the effect of discounting would be immaterial, in which case they
are stated at invoice amounts.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 560 ---
(p) Redeemable capital contribution
The Company entered into a series of investment agreements with certain independent investors, pursuant to
which, these investors agreed to make cash investments to the Company to acquire the equity interest of the Company
(collectively referred as “Series A, Series B, Series B+ and Series C Financing”).
Capital contributions from the Series A, Series B, Series B+ and Series C Financing are classified as financial
liabilities or equity in accordance with the substance of the share purchase agreement and the definitions of a
financial liability and an equity instrument.
Capital contributions from the Series A, Series B, Series B+ and Series C Financing are classified as equity
if they are nonredeemable by the Company or redeemable only at the Company’s option. Dividends on capital
contributions from the Series A, Series B and Series B+ Financing classified as equity are recognized as distributions
within equity.
The Company recognized the financial instruments issued to investors as financial liabilities, because not all
triggering events mentioned in the key terms above are within the control of the Company and these financial
instruments did not meet the definition of equity for the Company. The financial liabilities are measured at the higher
amount expected to be paid to the investors upon redemption or liquidation, on a present value basis, which is
assumed to be at the dates of issuance and at the end of each reporting period. Any changes in the carrying amount
of the financial liabilities were recorded in “Changes in carrying amount of redeemable capital contributions”.
Capital Contribution are classified as non-current liabilities or current liabilities depending on whether the
Capital Contribution can demand the Company to redeem the Preferred Shares for cash at least 12 months after the
end of the reporting period or not.
(q) Research and development costs
Research and development costs comprise all expenses that are directly attributable to research and
development activities or that can be allocated on a reasonable basis to such activities. Research and development
costs are recognized as expenses in the period in which they are incurred.
(r) Interest-bearing borrowings
Interest-bearing borrowings are measured initially at fair value less transaction costs. Subsequently, these
borrowings are stated at amortised cost using the effective interest method. Interest expense is recognised in
accordance with Note 2(z).
(s) Employee benefits
Short-term employee benefits and contributions to defined contribution retirement plans.
Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the
amount expected to be paid, if the Group has a present legal or constructive obligation to pay this amount as a result
of past service provided by the employee and the obligation can be estimated reliably.
Obligations for contributions to defined contribution retirement plans are expensed as the related service is
provided.
Contributions to local retirement schemes pursuant to the relevant labor rules and regulations in the
jurisdictions in which the Group’s subsidiaries located are recognized as an expense in profit or loss as incurred.
(t) Income tax
Income tax expense comprises current tax and deferred tax. It is recognised in profit or loss except to the extent
that it relates to a business combination, or items recognised in directly in equity or in OCI.
APPENDIX I ACCOUNTANTS’ REPORT
– I-23 –


--- page 561 ---
Current tax comprises the estimated tax payable or receivable on the taxable income or loss for the year and
any adjustments to the tax payable or receivable in respect of previous years. 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 taxes. It is measured using tax rates enacted or substantively enacted at the reporting date. Current tax also
includes any tax arising from dividends.
Current tax assets and liabilities are offset only if certain criteria are met.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised
for:
– temporary differences on the initial recognition of assets or liabilities in a transaction that is not a
business combination and that affects neither accounting nor taxable profit or loss and does not give rise
to equal taxable and deductible temporary differences;
– temporary differences related to investments in subsidiaries to the extent that the Group is able to
control the timing of the reversal of the temporary differences and it is probable that they will not
reverse in the foreseeable future; and
− taxable temporary differences arising on the initial recognition of goodwill.
The Group recognised deferred tax assets and deferred tax liabilities separately in relation to its lease liabilities
and right-of-use assets.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary
differences to the extent that it is probable that future taxable profits will be available against which they can be used.
Future taxable profits are determined based on the reversal of relevant taxable temporary differences. If the amount
of taxable temporary differences is insufficient to recognise a deferred tax asset in full, then future taxable profits,
adjusted for reversals of existing temporary differences, are considered, based on the business plans for individual
subsidiaries in the Group. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that
it is no longer probable that the related tax benefit will be realised; such reductions are reversed when the probability
of future taxable profits improves.
Deferred tax assets and liabilities are offset only if certain criteria are met.
(u) Provisions and contingent liabilities
Generally provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects
current market assessment of the time value of money and the risks specific to the liability.
A provision for warranties is recognised when the underlying products or services are sold, based on historical
warranty data and a weighting of possible outcomes against their associated probabilities.
A provision for onerous contracts is measured at the present value of the lower of the expected cost of
terminating the contract and the expected net cost of continuing with the contract, which is determined based on the
incremental costs of fulfilling the obligation under that contract and an allocation of other costs directly related to
fulfilling that contract. Before a provision is established, the Group recognises any impairment loss on the assets
associated with that contract (see note 2(j)(ii)).
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
benefits is remote. Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence
of one or more future events are also disclosed as contingent liabilities unless the probability of outflow of economic
benefits is remote.
Where some or all of the expenditure required to settle a provision is expected to be reimbursed by another
party, a separate asset is recognised for any expected reimbursement that would be virtually certain. The amount
recognised for the reimbursement is limited to the carrying amount of the provision.
APPENDIX I ACCOUNTANTS’ REPORT
– I-24 –


--- page 562 ---
(v) Revenue recognition
Revenue arises from the sale of goods and the provision of services in the ordinary course of the Group’s
business.
Revenue is recognised when control over a product or service is transferred to the customer. For each
performance obligation satisfied over time, the Group recognises revenue over time by measuring the progress toward
complete satisfaction of that performance obligation. If the Group does not satisfy a performance obligation over
time, the performance obligation is satisfied at a point in time, at the amount of promised consideration to which the
Group is expected to be entitled, 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.
Revenue is allocated to each performance obligation based on its standalone selling price. The Group generally
determines standalone selling prices based on observable prices. If the standalone selling price is not observable
through past transactions, the Group estimates the standalone selling price based on multiple factors, including, but
not limited to management approved price list or cost-plus margin analysis.
Where the contract contains a financing component which provides a significant financing benefit to the
customer for more than 12 months, revenue is measured at the present value of the amount receivable, discounted
using the discount rate that would be reflected in a separate financing transaction with the customer, and interest
income is accrued separately under the effective interest method. Where the contract contains a financing component
which provides a significant financing benefit to the Group, revenue recognised under that contract includes the
interest expense accreted on the contract liability under the effective interest method. The Group takes advantage of
the practical expedient in paragraph 63 of IFRS 15 and does not adjust the consideration for any effects of a
significant financing component if the period of financing is 12 months or less.
The Group generates substantially all of the revenues from the following services and products:
 Enterprise-level solutions;
 Other services primarily include promotion service.
The Group’s enterprise-level solutions are offered either on software platform or solutions come with
functionalities and interfacing capabilities tailored to customers’ operation environment integrated with
communication devices or other hardware and other service and software license. The Group determines that such
contracts typically comprise one single performance obligation. Revenues are recognised at a point in time upon
customer’s acceptance of the respective solutions or products, which is when the control over the Group’s goods or
services is transferred to customers.
The maintenance services are provided to customers for a fixed amount over the service period, usually within
one year. The Group recognizes revenues from maintenance services over the period when the services were
provided, since customers simultaneously receive and consume the benefit of the services. The Group uses
straight-line method to recognize revenue rateably over the service period. The other services provided to customers
are recognised based on usage over the period.
The Group recognises enterprise-level solutions revenue on a gross basis because the Group is the principal
and controls the hardware to be provided to the customer before the hardware is transferred to that customer. In
addition, the Group is primarily responsible for fulfilling the promise to provide the hardware and has discretion in
establishing the price for the hardware.
(w) Interest income
Interest income is recognised using the effective interest method. The “effective interest rate” is the rate that
exactly discounts estimated future cash receipts through the expected life of the financial asset to the gross carrying
amount of the financial asset. In calculating interest income, the effective interest rate is applied to the gross carrying
amount of the asset (when the asset is not credit-impaired). However, for financial assets that have become
credit-impaired, subsequent to initial recognition, interest income is calculated by applying the effective interest rate
to the amortised cost of the financial asset. If the asset is no longer credit-impaired, then the calculation of interest
income reverts to the gross basis.
APPENDIX I ACCOUNTANTS’ REPORT
– I-25 –


--- page 563 ---
(x) Government grants
Government grants are recognised in the consolidated statements of financial position initially when there is
reasonable assurance that they will be received and that the Group will comply with the conditions attaching to them.
Grants that compensate the Group for expenses incurred are recognised as income in profit or loss on a systematic
basis in the same periods in which the expenses are incurred. Grants that compensate the Group for the cost of an
asset are recognised initially as deferred income and amortised to profit or loss on a straight-line basis over the useful
life of the asset by way of being recognised in other income.
(y) Translation of foreign currency
Transactions in foreign currencies are translated into the respective functional currencies of Group companies
at the exchange rates at the dates of the transactions.
Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency
at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a
foreign currency are translated into the functional currency at the exchange rate when the fair value was determined.
Non-monetary assets and liabilities that are measured based on historical cost in a foreign currency are translated at
the exchange rate at the date of the transaction. Foreign currency differences are generally recognised in profit or
loss.
The income and expenses of foreign operations are translated into RMB at the exchange rates at the dates of
the transactions.
(z) Borrowing costs
Borrowing costs that are directly attributable to the acquisition, construction or production of an asset which
necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the
cost of that asset. Other borrowing costs are expensed in the period in which they are incurred.
(aa) Related parties
(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 the key management personnel of the Group or the Group’s parent.
(b) An entity is related to the Group if any of the following conditions applies:
(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 employees of either 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 the 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 to the Group’s parent.
APPENDIX I ACCOUNTANTS’ REPORT
– I-26 –


--- page 564 ---
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.
(bb) Segment reporting
Operating segments, and the amounts of each segment item reported in the financial statements, are identified
from the financial information provided regularly to the Group’s most senior executive management for the purposes
of allocating resources to, and assessing the performance of, the Group’s various lines of business and geographical
locations.
Individually material operating segments are not aggregated for financial reporting purposes unless the
segments have similar economic characteristics and are similar in respect of the nature of products and services, the
nature of production processes, the type or class of customers, the methods used to distribute the products or provide
the services, and the nature of the regulatory environment. Operating segments which are not individually material
may be aggregated if they share a majority of these criteria.
3 MATERIAL ACCOUNTING JUDGEMENT AND ESTIMATES
(a) Material accounting judgements in applying the Group’s accounting policies
In the process of applying the Group’s accounting policies, management made the following accounting
judgement:
Determining whether the Group is acting as a principal or as an agent in the sales of goods on the Group’s
platform requires judgement and consideration of all relevant facts and circumstances. In evaluation of the Group
acting as a principal or an agent, the Group considers, individually or in combination whether the Group is primarily
responsible for fulfilment the contract, is subject to the inventory risk, has discretion to establish prices. Having
considered the relevant facts and circumstances, the directors consider that the Group obtains control of those goods
sold in commerce business before the goods are transferred to the customers. Accordingly, the Group is acting as a
principal for the merchandise sales and the related revenue is presented on a gross basis.
(b) Source of estimation uncertainty
Notes 18 and 30(e) contain information about the assumptions and their risk factors relating to valuation of
fair value of financial assets. Other significant sources of estimation uncertainty are as follows:
(i) Fair value measurement of financial instruments using valuation techniques
The fair value of financial instruments that are not traded in an active market is determined using
valuation techniques. The valuation techniques include discounted cash flow model, market comparable model,
adjusted recent transaction price and so on. The Group uses its judgement to select a variety of methods and
make assumptions that are mainly based on market conditions existing at the end of each reporting period. For
details of the key assumptions used and the impact of changes to these assumptions see Note 30(e). The use
of different valuation techniques or inputs may result in significant differences in fair value estimate. The fair
value generated by valuation technique is also verified with transactions of same or similar financial
instruments in observable markets according to market practice.
(ii) Impairment of non-financial assets (other than goodwill)
The Group assesses whether there are any indicators of impairment for all non-financial assets
(including the right-of-use assets) at the end of each of the Track Record Periods. Non-financial assets are
tested for impairment when there are indicators that the carrying amounts may not be recoverable. An
impairment exists when the carrying value of an asset or a cash-generating unit exceeds its recoverable
amount, which is the higher of its fair value less costs of disposal and its value in use. The calculation of the
fair value less costs of disposal is based on available data from binding sales transactions in an arm’s length
transaction of similar assets or observable market prices less incremental costs for disposing of the asset. When
value in use calculations are undertaken, management must estimate the expected future cash flows from the
asset or cash-generating unit and choose a suitable discount rate in order to calculate the present value of those
cash flows.
APPENDIX I ACCOUNTANTS’ REPORT
– I-27 –


--- page 565 ---
(iii) Impairment of goodwill
The Group determines whether goodwill is impaired at least on an annual basis. This requires an
estimation of the value in use of the cash-generating units to which the goodwill is allocated. Estimating the
value in use requires the Group to make an estimate of the expected future cash flows from the cash-generating
units and also to choose a suitable discount rate in order to calculate the present value of those cash flows.
Further details are given in Note 15.
(iv) Deferred tax assets
Deferred tax assets are recognised for unused tax losses to the extent that it is probable that taxable
profit will be available against which the losses can be utilised. Significant management judgement is required
to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level
of future taxable profits together with future tax planning strategies.
(v) Loss allowance for expected credit losses
The Group estimates the amount of loss allowance for ECLs on trade and other receivables that are
measured at amortized cost based on the credit risk of the respective financial instruments. The loss allowance
amount is measured as the asset’s carrying amount and the present value of estimated future cash flows with
the consideration of expected future credit loss of the respective financial instrument. The assessment of the
credit risk of the respective financial instrument involves high degree of estimation and uncertainty. When the
actual future cash flows are less than expected or more than expected, a material impairment loss or a material
reversal of impairment loss may arise, accordingly.
4 REVENUE AND SEGMENT REPORTING
(a) Revenue
The principal activities of the Group are provision of on-premised integrated enterprise-level solutions
including software license, hardware and services. All of the Group’s revenues from contracts with customers within
the scope of IFRS 15.
The Group’s revenues are disaggregated by timing of revenue recognition and geographic information as
follows:
(i) Disaggregation of revenue from contracts with customers by major business lines of revenue
recognition
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Revenue from contracts with customers
within the scope of IFRS 15
Enterprise-level solutions 456,871 491,641 801,060
Others 3,064 23,351 11,957
459,935 514,992 813,017
APPENDIX I ACCOUNTANTS’ REPORT
– I-28 –


--- page 566 ---
(ii) Disaggregation of revenue from contracts with customers by the timing of revenue recognition
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Disaggregated by timing of revenue
recognition
Revenue over time 120,809 135,231 123,524
Revenue at a point in time 339,126 379,761 689,493
459,935 514,992 813,017
(iii) Information about major customers
The Group’s customer includes two, one and nil customers with whom transactions have exceeded 10%
of the Group’s revenues of each of the years ended 31 December 2021, 2022 and 2023 respectively. Revenue
from these customers during the Track Record Periods are set out below:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Customer A 53,825 62,982 N/A*
Customer B 58,543 N/A* N/A*
* Less than 10% of the Group’s revenue in the respective year.
(iv) Revenue expected to be recognized in the future arising from contracts with customers in existence
at the reporting date
As at 31 December 2021, 2022 and 2023, the Group has applied the practical expedient in paragraph 121
of IFRS 15 to its sales contracts for goods such that information about revenue expected to be recognized in
the future is not disclosed in respect of revenue that the Group will be entitled to when it satisfies the remaining
performance obligations under these contracts that had an expected duration of one year or less.
(b) Segment reporting
IFRS 8, Operating Segments, requires identification and disclosure of operating segment information based on
internal financial reports that are regularly reviewed by the Group’s chief operating decision maker for the purpose
of resources allocation and performance assessment. On this basis, the Group has determined that it only has one
operating segment during the Track Record Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-29 –


--- page 567 ---
(c) Geographic information
The following table sets out information about the geographical location of the Group’s revenue from external
customers. The geographical location of customers is based on the location at which the solution or services were
accepted.
Revenues from external customers
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Chinese Mainland 459,935 514,992 807,017
Other countries – – 6,000
459,935 514,992 813,017
5 OTHER REVENUE AND OTHER NET GAIN
(a) Other revenue
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Government grants 7,692 11,016 27,226
During the years ended 31 December 2021, 2022 and 2023, the Group received unconditional government
grants of RMB7,273,000, RMB10,840,000, and RMB27,084,000, respectively, as rewards of the Group’s contribution
to technology innovation and regional economic development.
During the years ended 31 December 2021, 2022 and 2023, the Group received conditional government grants
of RMB1,466,000, RMB nil, and RMB1,440,000, respectively, as encouragement of project development. The Group
recognized such type of grants of RMB419,000, RMB176,000, and RMB142,000, respectively, in the consolidated
statements of profit or loss when related conditions were satisfied.
(b) Other net gain/(loss)
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Net gain/(loss) on disposal of an associate 200 – (41)
Net (loss)/gain on disposal of property and
equipment and right-of-use assets – (16) (16)
200 (16) (25)
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 568 ---
6 PROFIT/(LOSS) BEFORE TAXATION
Profit/(loss) before taxation is arrived at after charging/(crediting):
(a) Net finance costs
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Interest income from bank deposits (30) (31) (73)
Finance income (30) (31) (73)------------ ------------ ------------
Interest on bank loans and other borrowings
(Note 21(c)) 7,839 8,532 11,132
Interest on borrowings from related parties
(Note 21(c)) – 130 –
Interest on lease liabilities (Note 21(c)) 374 403 637
Finance costs 8,213 9,065 11,769------------ ------------ ------------
8,183 9,034 11,696
(b) Staff costs
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Salaries, wages and other benefits 27,602 44,747 63,380
Contributions to defined contribution retirement
plan 2,325 4,219 6,431
29,927 48,966 69,811
(c) Other items
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cost of inventories
(Note 19) 180,719 162,735 302,493
Depreciation charge
– property and equipment (Note 11) 626 1,565 1,801
– right-of-use assets
(Note 12) 1,736 2,253 4,148
Amortisation of intangible assets (Note 13) 1,472 14,096 24,578
Auditors’ remuneration 75 71 52
Listing expenses – 4,575 15,934
APPENDIX I ACCOUNTANTS’ REPORT
– I-31 –


--- page 569 ---
7 INCOME TAX IN THE CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
(a) Taxation in the consolidated statements of profit or loss represents:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Current tax
Provision for the year 11,042 81 10,354
(Over)-provision in respect of prior years – – (375)
11,042 81 9,979
Deferred tax
Origination and reversal of temporary differences
(Note 27(b)) (2,995) (5,154) (9,533)
Total 8,047 (5,073) 446
Note: The Company and subsidiaries were all incorporated in PRC. The Company and subsidiaries are subject
to the PRC Corporate Income Tax Law (“CIT Law”) at the statutory income tax rate of 25%, except for
following specified:
According to the Administrative Measures for Determination of High-Tech Enterprises (Guokefahuo
[2016] No. 32), the Company obtained the qualification as high-technology enterprise and was entitled
to a preferential income tax rate of 15% from the years from 2021 to 2024.
According to Caishui [2019] No. 13, “The Announcement of Implementation on Inclusive Tax Relief
Policy of Small-scaled Minimal Profit Enterprise” issued by Ministry of Finance of the PRC and
National Tax Bureau on 17 January 2019, the small-scaled minimal profit enterprise with an annual
taxable income below RMB1,000,000 (RMB1,000,000 included) is entitled to a preferential tax
treatment of 75% exemption of taxable income and application of income tax rate as 20%; the
small-scaled minimal profit enterprise with an annual taxable income between RMB1,000,000 and
RMB3,000,000 (RMB3,000,000 included) is entitled to a preferential tax treatment of 50% exemption
of taxable income and application of income tax rate as 20%, from 1 January 2019 to 31 December 2021.
According to Announcement [2021] No. 12, “The Announcement of Implementation of Income Tax
Incentives for Micro and Small Enterprises and Individually-owned Businesses” issued by Ministry of
Finance of the PRC and National Tax Bureau on 2 April 2021, the small-scaled minimal profit enterprise
with an annual taxable income below RMB1,000,000 (RMB1,000,000 included) is entitled to a
preferential tax treatment of 87.5% exemption of taxable income and application of income tax rate as
20% from 1 January 2021 to 31 December 2022.
According to Announcement [2023] No. 6, “The Announcement of Implementation of Income Tax
Incentives for Micro and Small Enterprises and Individually-owned Businesses” issued by Ministry of
Finance of the PRC and National Tax Bureau on 26 March 2023, the small-scaled minimal profit
enterprise with an annual taxable income below RMB1,000,000 (RMB1,000,000 included) is entitled to
a preferential tax treatment of 75% exemption of taxable income and application of income tax rate as
20% from 1 January 2023 to 31 December 2023.
Certain subsidiaries in the Group meet the conditions as small-scaled minimal profit enterprise were
qualified for the entitlement of such preferential tax treatment during the Track Record Periods.
Under the PRC Income Tax Law and its relevant regulations, 75% additional tax deduction is allowed
for qualified research and development costs for the years ended 31 December 2020, 2021 and during
the period from 1 January 2022 to 30 September 2022.
APPENDIX I ACCOUNTANTS’ REPORT
– I-32 –


--- page 570 ---
According to Announcement [2022] No.28 of the Ministry of Finance, the State Taxation Administration
and the Ministry of Science and Technology, High-tech enterprises are allowed to deduct the full amount
of equipment and appliances newly purchased during the period from 1 October 2022 to 31 December
2022 from the taxable income amount on a one-off basis in the current year and allowed to conduct
100% additional tax deduction before tax. For the enterprises entitled to the current additional tax
deduction ratio of 75% for research and development expenses, such ratio is raised to 100% during the
period from 1 October 2022 to 31 December 2022.
According to Announcement [2023] No. 7 of the Ministry of Finance and the State Taxation
Administration, the enterprises entitled to the current additional tax deduction ratio of 100% for research
and development expenses during the period from 1 January 2023 to 31 December 2023.
(b) Reconciliation between actual income tax expense/(benefit) and accounting profit/(loss) at applicable tax
rates:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Profit/(loss) before taxation 44,431 (90,884) (28,755)
Notional tax on profit before taxation, calculated
at the rates applicable to profits in the countries
concerned 11,108 (22,721) (7,189)
Effect of preferential tax rate (3,717) 7,557 (1,238)
Super-deduction of research and development
expenses (4,422) (7,822) (14,561)
Tax effect of non-deductible expenses 54 69 291
Effect of utilisation of deductible losses
previously not recognised – – (526)
Tax effect of changes in the carrying amount of
redeemable capital contributions 3,892 23,626 22,034
Super-deduction of acquisition of property and
equipment – (7,717) –
Tax effect of deductible temporary differences or
deductible losses not recognized 1,132 1,935 2,078
Effect on deferred tax balances at 1 January
resulting from a change in tax rate – – (68)
(Over)-provision in respect of prior years – – (375)
Actual tax expense/(benefit) 8,047 (5,073) 446
APPENDIX I ACCOUNTANTS’ REPORT
– I-33 –


--- page 571 ---
8 DIRECTORS’ EMOLUMENTS
Directors’ emoluments disclosed pursuant to section 383(1) of the Hong Kong Companies Ordinance and Part
2 of the Companies (Disclosure of Information about Benefits of Directors) Regulation are as follows:
For the year ended 31 December 2021
Directors’
fees
Salaries,
allowances
and benefits
in kind
Discretionary
bonuses
Retirement
scheme
contributions
Termination
benefits Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors
Jinghua Tang – 1,264 254 36 – 1,554
Qi Sun – 1,264 254 36 – 1,554
Non-Executive directors
Xiaoyuan Yang 71 – – – – 71
Xiaobo Tan – – – – – –
Fenggao Zhao (resigned on
28 April 2021) – – – – – –
Bin Cao (resigned on
28 April 2021) – – – – – –
Yulei Chen (appointed on
8 May 2021) – – – – – –
Tiantian Ma (appointed on
8 May 2021) – – – – – –
Independent directors
Rong Liu 60 – – – – 60
Binrui Mou (appointed on
3 November 2021) 10 – – – – 10
Haipeng Wu (appointed on
30 June 2021) 35 – – – – 35
Supervisors
Dong Xiao – 249 – 25 – 274
Yongzheng Wu – 181 – 28 – 209
Xiaodi Xu – 167 – 14 – 181
176 3,125 508 139 – 3,948
For the year ended 31 December 2022
Directors’
fees
Salaries,
allowances
and benefits
in kind
Discretionary
bonuses
Retirement
scheme
contributions
Termination
benefits Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors
Jinghua Tang – 1,948 – 63 – 2,011
Qi Sun – 1,948 – 63 – 2,011
Non-Executive directors
Xiaoyuan Yang 72 – – – – 72
Xiaobo Tan – – – – – –
Yulei Chen – – – – – –
Tiantian Ma – – – – – –
Independent directors
Rong Liu 73 – – – – 73
Binrui Mou 73 – – – – 73
Haipeng Wu 73 – – – – 73
APPENDIX I ACCOUNTANTS’ REPORT
– I-34 –


--- page 572 ---
For the year ended 31 December 2022
Directors’
fees
Salaries,
allowances
and benefits
in kind
Discretionary
bonuses
Retirement
scheme
contributions
Termination
benefits Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Supervisors
Dong Xiao – 344 – 21 – 365
Yongzheng Wu – 221 – 31 – 252
Xiaodi Xu – 215 – 27 – 242
291 4,676 – 205 – 5,172
For the year ended 31 December 2023
Directors’
fees
Salaries,
allowances
and benefits
in kind
Discretionary
bonuses
Retirement
scheme
contributions
Termination
benefits Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors
Jinghua Tang – 2,029 – 68 – 2,097
Qi Sun – 2,034 – 68 – 2,102
Non-Executive directors
Xiaoyuan Yang 73 – – – – 73
Xiaobo Tan – – – – – –
Yulei Chen – – – – – –
Tiantian Ma – – – – – –
Independent directors
Rong Liu 72 – – – – 72
Binrui Mou 72 – – – – 72
Haipeng Wu 72 – – – – 72
Sinn Wai Kin Derek
(appointed on 19 June
2023) 195 – – – – 195
Supervisors
Dong Xiao – 389 – 51 – 440
Yongzheng Wu – 225 – 34 – 259
Xiaodi Xu – 313 – 35 – 348
484 4,990 – 256 – 5,730
During the years ended 31 December 2021, 2022 and 2023, no amounts were paid or payable by the Group
to the above non-director highest paid individuals as an inducement to join or upon joining the Group or as
compensation for loss of any office in connection with the management of the affairs of any member of the Group.
APPENDIX I ACCOUNTANTS’ REPORT
– I-35 –


--- page 573 ---
9 INDIVIDUALS WITH HIGHEST EMOLUMENTS
For the years ended 31 December 2021, 2022 and 2023, of the five individuals with the highest emoluments,
two, two and two are directors, respectively, whose emoluments are disclosed in Note 8. The aggregate of the
emoluments in respect of the remaining individuals are as follows:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Salaries, allowances and benefits in kind 2,274 3,255 3,408
Discretionary bonuses 301 135 453
Retirement scheme contributions 124 188 204
2,699 3,578 4,065
The emoluments of the three, three, and three with the highest emoluments during the year ended 31 December
2021, 2022 and 2023, respectively, are within the following bands:
Y ears ended 31 December
2021 2022 2023
Number of
individuals
Number of
individuals
Number of
individuals
HKDnil – HKD500,000 – – –
HKD500,001 – HKD1,000,000 2 2 1
HKD1,000,001 – HKD1,500,000 – – 1
HKD1,500,001 – HKD2,000,000 1 – –
HKD2,000,001 – HKD2,500,000 – 1 1
10 EARNINGS/(LOSS) PER SHARE
(a) Basic earnings/(loss) per share
The calculation of the basic earnings/(loss) per share for the years ended 31 December 2021, 2022 and 2023
are calculated by dividing the profit attributable to the ordinary shareholders of the Group by the weighted average
number of ordinary shares in issue during the Track Record Periods, calculated as follows:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Profit/(loss) attributable to equity shareholders of
the Company 36,895 (87,155) (33,754)
Allocation of profit/(loss) for the year
attributable to equity shareholders of
redeemable capital contributions (9,208) 29,813 14,241
Profit/(loss) attributable to ordinary equity
shareholders of the Company for the purpose
of basic earnings/(loss) per share 27,687 (57,342) (19,513)
APPENDIX I ACCOUNTANTS’ REPORT
– I-36 –


--- page 574 ---
Weighted average number of ordinary shares
Y ears ended 31 December
2021 2022 2023
Issued ordinary shares at the beginning of the
year 22,160,000 25,670,000 28,290,000
Effect of ordinary shares issued for redeemable
capital contributions (4,960,000) (8,470,000) (11,073,833)
Weighted average number of ordinary share at
the end of the year for the purpose of basic
earnings/(loss) per share 17,200,000 17,200,000 17,216,167
Y ears ended 31 December
2021 2022 2023
Profit/(loss) attributable to the ordinary
shareholders of the Company (in RMB’000) 27,687 (57,342) (19,513)
Weighted average number of ordinary shares in
issue (number of shares) 17,200,000 17,200,000 17,216,167
Basic earnings/(loss) per share (in RMB) 1.61 (3.33) (1.13)
Effect of ordinary shares issued for redeemable capital contributions represent the weighted average number
of ordinary shares of the Group associated with the redeemable capital contributions (see Note 26) at 31 December
2021, 2022 and 2023, which are subject to redemption and excluded from the calculation of the basic earnings/(loss)
per share.
(b) Diluted earnings/(loss) per share
Diluted earnings/(loss) per share is calculated by adjusting the weighted average number of ordinary shares
outstanding to assume conversion of all dilutive potential ordinary shares.
The effect of redeemable capital contributions is anti-dilutive during the year ended 31 December 2021, 2022
and 2023, therefore is not included calculation of diluted earnings per share of the Company.
Accordingly, diluted loss per share during the Track Record Periods are the same as basic earnings/(loss) per
share.
APPENDIX I ACCOUNTANTS’ REPORT
– I-37 –


--- page 575 ---
11 PROPERTY AND EQUIPMENT
The Group
Electronic
equipment Furniture Servers Vehicles
Construction-
in-process
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Cost:
At 1 January 2021 358 326 136 470 – 595 1,885
Additions 2,053 109 1,811 – 253 275 4,501
At 31 December 2021
and 1 January 2022 2,411 435 1,947 470 253 870 6,386
Additions 187 25 1,007 – 59,919 – 61,138
Disposals (269) (23) (15) – – – (307)
At 31 December 2022
and 1 January 2023 2,329 437 2,939 470 60,172 870 67,217
Additions 313 443 7,191 – 29,091 1,319 38,357
Transfers 1,769 – 72,672 – (89,263) 10,397 (4,425)
Disposals (8) (60) – – – – (68)
At 31 December 2023 4,403 820 82,802 470 – 12,586 101,081------- ------- ------- ------- ---------- ---------- -------
Accumulated
depreciation:
At 1 January 2021 (271) (48) (21) (447) – – (787)
Charge for the year (132) (73) (148) – – (273) (626)
At 31 December 2021
and 1 January 2022 (403) (121) (169) (447) – (273) (1,413)
Charge for the year (706) (78) (491) – – (290) (1,565)
Written back on
disposals 255 22 14 – – – 291
At 31 December 2022
and 1 January 2023 (854) (177) (646) (447) – (563) (2,687)
Charge for the year (756) (114) (588) – – (343) (1,801)
Written back on
disposals 8 46 – – – – 54
At 31 December 2023 (1,602) (245) (1,234) (447) – (906) (4,434)-------
------- ------- ------- ---------- ---------- -------
Net book value:
At 31 December 2021 2,008 314 1,778 23 253 597 4,973
At 31 December 2022 1,475 260 2,293 23 60,172 307 64,530
At 31 December 2023 2,801 575 81,568 23 – 11,680 96,647
APPENDIX I ACCOUNTANTS’ REPORT
– I-38 –


--- page 576 ---
The Company
Electronic
equipment Furniture Servers Vehicles
Construction-
in-process
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Cost:
At 1 January 2021 358 326 136 470 – 595 1,885
Additions 2,042 109 1,811 – 253 275 4,490
At 31 December 2021
and 1 January 2022 2,400 435 1,947 470 253 870 6,375
Additions 152 25 1,007 – 52,785 – 53,969
Disposals (269) (23) (15) – – – (307)
At 31 December 2022
and 1 January 2023 2,283 437 2,939 470 53,038 870 60,037
Additions 203 6 7,087 – 26,304 – 33,600
Transfers 1,766 – 72,420 – (79,342) 731 (4,425)
Disposals (8) (60) – – – – (68)
At 31 December 2023 4,244 383 82,446 470 – 1,601 89,144------- ------- ------- ------- ---------- ---------- -------
Accumulated
depreciation:
At 1 January 2021 (271) (48) (21) (447) – – (787)
Charge for the year (131) (73) (148) – – (273) (625)
At 31 December 2021
and 1 January 2022 (402) (121) (169) (447) – (273) (1,412)
Charge for the year (701) (78) (491) – – (290) (1,560)
Written back on
disposals 255 22 14 – – – 291
At 31 December 2022
and 1 January 2023 (848) (177) (646) (447) – (563) (2,681)
Charge for the year (733) (84) (575) – – (283) (1,675)
Written back on
disposals 9 46 – – – – 55
At 31 December 2023 (1,572) (215) (1,221) (447) – (846) (4,301)-------
------- ------- ------- ---------- ---------- -------
Net book value:
At 31 December 2021 1,998 314 1,778 23 253 597 4,963
At 31 December 2022 1,435 260 2,293 23 53,038 307 57,356
At 31 December 2023 2,672 168 81,225 23 – 755 84,843
APPENDIX I ACCOUNTANTS’ REPORT
– I-39 –


--- page 577 ---
12 RIGHT-OF-USE ASSETS
The analysis of the net book value of right-of-use assets by class of underlying asset is presented below:
The Group
Property leased
for own use
RMB’000
At 1 January 2021 8,676
Additions 762
Depreciation charge for the year (1,736)
At 31 December 2021 and 1 January 2022 7,702
Additions 5,245
Depreciation charge for the year (2,253)
At 31 December 2022 and 1 January 2023 10,694
Additions 4,917
Modification 3,519
Disposals (679)
Depreciation charge for the year (4,148)
Depreciation written back on disposal 313
At 31 December 2023 14,616
The Company
Property leased
for own use
RMB’000
At 1 January 2021 7,073
Additions 679
Depreciation charge for the year (1,452)
At 31 December 2021 and 1 January 2022 6,300
Additions –
Depreciation charge for the year (1,536)
At 31 December 2022 and 1 January 2023 4,764
Additions 591
Modification 1,587
Disposals (679)
Depreciation charge for the year (1,614)
Depreciation written back on disposal 313
At 31 December 2023 4,962
APPENDIX I ACCOUNTANTS’ REPORT
– I-40 –


--- page 578 ---
The analysis of expense items in relation to leases recognised in profit or loss is as follows:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Depreciation charge of right-of-use assets by
class of underlying asset:
– Office buildings (i) 1,736 2,253 4,148
Interest on lease liabilities (Note 6(a)) 374 403 637
Expense relating to short-term leases 123 12 45
Expense relating to leases of low-value assets,
excluding short-term leases of low-value assets 5 11 26
Details of total cash outflow for leases and the maturity analysis of lease liabilities are set out in Notes 21(d)
and 25, respectively.
(i) Office Buildings
The Group has obtained the right to use certain office buildings through tenancy agreements during the Track
Record Periods. The leases typically run for an initial period of 2 to 7 years, some leases include an option to renew
the lease when all terms are renegotiated. None of the leases include variable lease payments.
13 INTANGIBLE ASSETS
The Group
Software Patents Total
RMB’000 RMB’000 RMB’000
Cost:
At 1 January 2021 – – –
Additions 17,108 – 17,108
Acquisition of a subsidiary (Note 34) – 8,600 8,600
At 31 December 2021, and 1 January 2022 17,108 8,600 25,708
Additions 91,810 – 91,810
Acquisition of a subsidiary (Note 34) – 9,000 9,000
At 31 December 2022, and 1 January 2023 108,918 17,600 126,518
Additions 19,885 – 19,885
Transfers 4,425 – 4,425
At 31 December 2023 133,228 17,600 150,828 ------------ ------------ ------------
APPENDIX I ACCOUNTANTS’ REPORT
– I-41 –


--- page 579 ---
Software Patents Total
RMB’000 RMB’000 RMB’000
Accumulated amortisation:
At 1 January 2021 – – –
Charge for the year (935) (537) (1,472)
At 31 December 2021 and 1 January 2022 (935) (537) (1,472)
Charge for the year (12,927) (1,169) (14,096)
At 31 December 2022 and 1 January 2023 (13,862) (1,706) (15,568)
Charge for the year (22,378) (2,200) (24,578)
At 31 December 2023 (36,240) (3,906) (40,146) ------------
------------ ------------
Net book value:
At 31 December 2021 16,173 8,063 24,236
At 31 December 2022 95,056 15,894 110,950
At 31 December 2023 96,988 13,694 110,682
During the Track Record Periods, the amounts of amortization expense charged to cost of revenue, research
and development expenses and administrative and other operating expenses are as follows:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cost of revenue 670 2,568 4,099
Research and development expenses 569 7,584 13,744
Administrative and other operating expenses 233 3,944 6,735
1,472 14,096 24,578
Intangible assets patents represent patents acquired by the Group in connection with the acquisition of
Shanghai Yuanya Information Technology Co., Ltd. and Xian Jinxun Digital Intelligence Information Technology
Co., Ltd. completed on 19 July 2021 and 30 December 2022, The amortization charge for the years ended 31
December 2021, 2022 and 2023 is included in “Cost of revenue” in the consolidated statements of profit or loss.
APPENDIX I ACCOUNTANTS’ REPORT
– I-42 –


--- page 580 ---
The Company
Software
RMB’000
Cost:
At 1 January 2021 –
Additions 12,319
At 31 December 2021, and 1 January 2022 12,319
Additions 59,948
At 31 December 2022, and 1 January 2023 72,267
Additions 19,885
Transfers 4,425
At 31 December 2023 96,577--------------
Accumulated amortisation:
At 1 January 2021 –
Charge for the year (616)
At 31 December 2021 and 1 January 2022 (616)
Charge for the year (9,920)
At 31 December 2022 and 1 January 2023 (10,536)
Charge for the year (15,047)
At 31 December 2023 (25,583)--------------
Net book value:
At 31 December 2021 11,703
At 31 December 2022 61,731
At 31 December 2023 70,994
APPENDIX I ACCOUNTANTS’ REPORT
– I-43 –


--- page 581 ---
During the Track Record Periods, the amounts of amortization expense charged to cost of revenue, research
and development expenses and administrative and other operating expenses are as follows:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cost of revenue 133 972 1,899
Research and development expenses 250 5,881 8,411
Administrative and other operating expenses 233 3,067 4,737
616 9,920 15,047
14 INTERESTS IN SUBSIDIARIES
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Investment costs 38,106 66,766 74,439
As at 31 December 2023, the Company has direct or indirect interests in the following principal subsidiaries,
all of which are private companies:
Company name
Place and date of
establishment
Particulars of
registered and
paid-in capital
Effective interest
held
by the Group
Principal
activities
As at 31 December
2021 2022 2023
Shanghai Yuanya Information Technology
Co., Ltd. (ʮ̡)
(Notes (i), (ii) and (iii))
The People’s Republic of
China (“PRC”) 27 July
2017
RMB10,000,000/
RMB10,000,000
51% 51% 51% Software and
information
technology
services
V oicecomm Yilian (Shanghai) Software
Technology Co., Ltd. ( ᑊஷɓ⥴(ɪऎ)ழ
ʮ̡) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”) 13 July
2020
RMB10,000,000/
RMB3,445,700
67% 67% 67% Software and
information
technology
services
Shandong V oicecomm Information
Technology Co., Ltd. (߅ࢹڦ
ʮ̡) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”)
10 November 2020
RMB10,000,000/
RMB10,000,000
100% 100% 100% Software and
information
technology
services
Shandong V oicecomm Intelligent
Technology Co., Ltd. (߅
ʮ̡) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”) 20 April
2021
RMB10,000,000/
RMB10,000,000
100% 100% 100% Software and
information
technology
services
Xian Jinxun Digital Intelligence
Information Technology Co., Ltd. ( Гτ
ʮ̡) (Notes (i),
(ii) and (iv))
The People’s Republic of
China (“PRC”)
7 July 2022
RMB5,500,000/
RMB500,000
– 51% 51% Software and
information
technology
services
APPENDIX I ACCOUNTANTS’ REPORT
– I-44 –


--- page 582 ---
Company name
Place and date of
establishment
Particulars of
registered and
paid-in capital
Effective interest
held
by the Group
Principal
activities
As at 31 December
2021 2022 2023
Sichuan V oicecomm Jiachen Information
Technology Co., Ltd. (ڦ
ʮ̡) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”) 30
August 2022
RMB20,000,000/
RMB1,270,000
– 100% 100% Software and
information
technology
services
Hainan V oicecomm Intelligent Technology
Co., Ltd. (ப΂ʮ
̡) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”)
5 December 2022
RMB10,000,000/
RMB1,400,000
– 100% 100% Software and
information
technology
services
Jiangsu Shengtong Information
Technology Co., Ltd. (߅ࢹڦ
ப΂ʮ̡) (Notes (i), (ii)
and (v))
The People’s Republic of
China (“PRC”)
18 January 2023
RMB10,000,000/
nil
– – – Software and
information
technology
services
Sichuan Shengtong Xuanwu Information
Technology Co., Ltd. (ڦ؛
ʮ̡) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”)
11 May 2023
RMB20,000,000/
RMB1,760,000
– – 100% Software and
information
technology
services
Sichuan Shengtong Gengyou Automotive
Parts Intelligent Manufacturing Co.,
Ltd. (Ԡӛԓཧ௅΁౽ঐႡி
ʮ̡) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”)
10 May 2023
RMB20,000,000/
RMB1,250,000
– – 100% Manufactory
and
technology
service
Chongqing Shengtong Intelligent
Technology Co., Ltd. (߅
ʮ̡) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”)
8 June 2023
RMB10,000,000/
RMB1,140,000
– – 100% Software and
information
technology
services
Sichuan Shengtong Zhigan Technology
Co., Ltd. (ʮ̡)
(Notes (i) and (ii))
The People’s Republic of
China (“PRC”)
28 June 2023
RMB20,000,000/
RMB50,000
– – 100% Software and
information
technology
services
Sichuan Shengtong Yunxiu Information
Technology Co., Ltd. (ڦ
ʮ̡
) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”)
28 June 2023
RMB20,000,000/
RMB100,000
– – 100% Software and
information
technology
services
Chengdu Shengtong Zhigan Technology
Co., Ltd. (ʮ̡)
(Notes (i), (ii) and (v))
The People’s Republic of
China (“PRC”) 25 July
2023
RMB30,000,000/
nil
– – – Software and
information
technology
services
Sichuan Shengtong Zhishi Technology
Co., Ltd. (ʮ̡)
(Notes (i) and (ii))
The People’s Republic of
China (“PRC”) 31 July
2023
RMB30,000,000/
RMB770,000
– – 100% Software and
information
technology
services
Guang’an Shengtong Information
Technology Co., Ltd. (߅ࢹڦ
ʮ̡) (Notes (i) and (ii))
The People’s Republic of
China (“PRC”) 23
August 2023
RMB10,000,000/
RMB33,000
– – 100% Software and
information
technology
services
APPENDIX I ACCOUNTANTS’ REPORT
– I-45 –


--- page 583 ---
(i) These entities are limited liability companies established in the PRC. The official names of these entities
are in Chinese. The English translation of the Company names is for identification purpose only.
(ii) No audited financial statements have been prepared for the years ended 31 December 2021, 2022 and
2023.
(iii) On 19 July 2021, the Company acquired 51% equity interests in Shanghai Yuanya Information
Technology Co., Ltd. from third party which is principally engaged in, among others, the research and
development of automobile management platforms.
(iv) On 30 December 2022, the Company acquired 51% equity interests in Xi’an Jinxun Digital Intelligence
Information Technology Co., Ltd. from third party to enhance the Group’s service capabilities in voice
communication sector.
(v) These two subsidiaries were voluntarily deregistered in 2023.
All companies now comprising the Group have adopted December 31 as their financial year end date.
15 GOODWILL
The movement of goodwill is set out as below:
Cost: RMB’000
At 1 January 2021 –
Acquisition of a subsidiary (Note 34 (i)) 17,111
At 31 December 2021 17,111
Acquisition of a subsidiary (Note 34 (ii)) 22,057
At 31 December 2022 and at 31 December 2023 39,168
Accumulated impairment losses:
At 1 January 2021, 31 December 2021, 31 December 2022 and 31 December 2023 – --------------
Carrying amount:
At 31 December 2023 39,168
At 31 December 2022 39,168
At 31 December 2021 17,111
Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets
acquired in the acquisition. The goodwill is not deductible for tax purposes.
APPENDIX I ACCOUNTANTS’ REPORT
– I-46 –


--- page 584 ---
Impairment tests for cash-generating units containing goodwill
The goodwill mainly arose from the acquisitions of Shanghai Yuanya Information Technology Co., Ltd.
(“Yuanya Information”) on 19 July 2021 and Xi’an Jinxun Digital Intelligence Information Technology Co., Ltd.
(“Jinxun Digital Intelligence”) on 30 December 2022, amounting to RMB17,111,000 and RMB22,057,000 (Note 34),
respectively.
Goodwill is attributable to the acquired market share and economies of scale expected to be derived from
combining with the operations of the Group following these acquisitions.The Group carries out its annual impairment
test on goodwill by comparing the recoverable amounts of CGU or group of CGUs to the carrying amounts. Goodwill
arising from the acquisition of Yuanya Information and Jinxun Digital Intelligence, was monitored separately and
assessed as separate CGUs for the purpose of impairment testing.
Impairment review on the goodwill has been conducted by the management as of 31 December 2021, 2022 and
2023. The recoverable amount of the CGUs is determined based on value-in-use calculations. The Group engaged an
independent professional valuer to assist with the calculation. These calculations use cash flow projections based on
financial budgets approved by management covering a five-year period. Cash flows beyond the five-year period are
extrapolated using an estimated weighted average growth rate. The growth rates used do not exceed the long-term
average growth rates for the business in which the CGU operates.
Key assumptions of the significant CGU as at 31 December 2021 is set out as follow:
Yuanya
Information
Compound annual growth rate of revenue during the 5-year forecast period 12.5%
Long-term growth rate 2.5%
Discount rate 16.3%
Key assumptions of the significant CGUs as at 31 December 2022 are set out as follows:
Yuanya
Information
Jinxun Digital
Intelligence
Compound annual growth rate of revenue during the 5-year
forecast period 13.0% 7.9%
Long-term growth rate 2.3% 2.3%
Discount rate 16.3% 16.8%
Key assumptions of the significant CGUs as at 31 December 2023 are set out as follows:
Yuanya
Information
Jinxun Digital
Intelligence
Compound annual growth rate of revenue during the 5-year
forecast period 8.1% 19.5%
Long-term growth rate 2.2% 2.2%
Discount rate 16.3% 16.8%
APPENDIX I ACCOUNTANTS’ REPORT
– I-47 –


--- page 585 ---
Details of the headroom calculated based on the recoverable amounts deducting the carrying amount allocated
for the significant CGUs are set out as follows:
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Yuanya Information 2,754 4,004 7,864
Jinxun Digital Intelligence – 2,854 7,861
Management have undertaken sensitivity analysis on the impairment test of goodwill. The following table sets
out the hypothetical changes to annual growth rate during the 5-year forecast and discount rate that would, in
isolation, have removed the remaining headroom respectively as at 31 December 2021:
Yuanya
Information
Compound annual growth rate of revenue during the 5-year forecast period -0.5%
Discount rate +0.7%
Management have undertaken sensitivity analysis on the impairment test of goodwill. The following table sets
out the hypothetical changes to annual growth rate during the 5-year forecast and discount rate that would, in
isolation, have removed the remaining headroom respectively as at 31 December 2022:
Yuanya
Information
Jinxun Digital
Intelligence
Compound annual growth rate of revenue during the 5-year
forecast period -0.6% -0.6%
Discount rate +1.1% +0.6%
Management have undertaken sensitivity analysis on the impairment test of goodwill. The following table sets
out the hypothetical changes to annual growth rate during the 5-year forecast and discount rate that would, in
isolation, have removed the remaining headroom respectively as at 31 December 2023:
Yuanya
Information
Jinxun Digital
Intelligence
Compound annual growth rate of revenue during the 5-year
forecast period -2.0% -2.0%
Discount rate +1.9% +1.6%
The Company performs annual impairment test on goodwill at the end of the reporting year. The recoverable
amount of the CGU based on the value-in-use calculations is higher than its carrying amount as at 31 December 2021,
2022 and 2023. With regard to the assessment of the VIU of the CGUs, the directors of the Company believe that
any reasonably possible change in any of the above key assumptions would not cause the carrying value, including
goodwill, of the CGUs to exceed the recoverable amounts.
APPENDIX I ACCOUNTANTS’ REPORT
– I-48 –


--- page 586 ---
16 INTERESTS IN ASSOCIATES
The following list contains associates of the Group and the Company, all of which are unlisted corporate
entities whose quoted market price is not available:
Proportion of ownership
interest as at
31 December 2023
Name of company
Place of
establishment
and business
Particulars of
issued and
paid-in capital
Group’s
effective
interest
Held by the
Company
Principal
activities
Shanghai V oicecomm Yuanzhi
Technology Co., Ltd.
(“V oicecomm Yuanzhi”) ( ɪऎ
ʮ̡) (Notes
(i) and (iv))
The PRC RMB10,000,000/
RMB4,273,000
– – Software and
Information
Technology
Services
Jiangsu V oicecomm Information
Technology Co., Ltd. ( Ϫᘽᑊ
ʮ̡) (Notes
(ii) and (iii))
The PRC RMB10,000,000/
RMB2,000,000
– – Computer
software and
hardware
manufacturing
SDG V oicecomm Service
(Wuhan) Co., Ltd. (“SDG
V oicecomm”) (؂
ਕ(ဏ)ʮ̡) (Note (v))
The PRC RMB5,000,000/
RMB2,500,000
10% 10% Provision of
technology
related services
* The English translation of the associates’ names is for reference only. The official names of these
companies are in Chinese.
(i) In August 2019, the Group invested 20% of the equity interest in Shanghai V oicecomm Yuanzhi
Technology Co., Ltd. with contributed registered capital in RMB2,000,000. In 2020, 2021 and 2022, the
Group made the capital injection in RMB150,000, RMB300,000 and RMB1,550,000, respectively.
(ii) In June 2020, the Group invested 20% of the equity interest in Jiangsu V oicecomm Information
Technology Co., Ltd. through capital injection of RMB2,000,000 in cash.
(iii) In March 2021, the Group dispose its 20% of the equity interest of Jiangsu V oicecomm Information
Technology Co., Ltd. to Beijing Yujia Technology Co., Ltd. at a consideration of RMB2,200,000 in cash.
The gain of the disposal amounted to RMB200,000 was recorded in the other net gain/(loss) of the
consolidated statements of profit or loss.
(iv) In September 2023, the Group dispose its 20% of the equity interest of V oicecomm Yuanzhi to Shanghai
V oicecomm Rongzhi Technology Group Co., Ltd., a company controlled by Jinghua Tang, at a
consideration of RMB2,000,000 in cash. The loss of the disposal amounted to RMB41,000 was recorded
in the other net gain/(loss) of the consolidated statements of profit or loss.
(v) In August 2023, the Group invested 10% of the equity interest in SDG V oicecomm with contributed
registered capital in RMB500,000. In 2023, the Group made the capital injection in RMB250,000.
The Group accounts for SDG V oicecomm as an investment in an associate using the equity method in
the consolidated financial statements of the Group under applicable financial reporting standards, as the
Group has the right to appoint a director in the board of directors of SDG V oicecomm.
All of the above associates are accounted for using the equity method in the consolidated financial statements
during the Track Record Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-49 –


--- page 587 ---
The Group assesses whether this is any objective evidence that its interest in the associates are impaired at the
end of each reporting period by considering the associates’ business development process, any significant financial
difficulty, default or bankruptcy encountered by the associates and adverse change in technological, market,
economic or legal environment. Based on the assessment above, the Group concluded that no impairment indicator
was identified at the end of each reporting period and no impairment loss of interest in associates is considered
necessary to be recognized in the consolidated statements of profit or loss.
Aggregate information of associates that are not individually material:
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Aggregate carrying amount of individually
immaterial associates in the consolidated
financial statements 360 2,041 230
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
(Loss)/gain from continuing operations (22) 131 (20)
Total comprehensive income (22) 131 (20)
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 2,082 360 2,041
Capital injection of interests in associates 300 1,550 250
Disposal of interests in an associate (2,000) – (2,000)
Net loss on disposal of an associate – – (41)
Share of (loss)/gain of associates (22) 131 (20)
At the end of the year 360 2,041 230
17 FINANCIAL ASSETS AT FAIR V ALUE THROUGH OTHER COMPREHENSIVE INCOME
The Group and the Company
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Equity securities designated at FVOCI
(non-recycling)
– Unlisted equity securities 516 560 771
The unlisted equity security at FVOCI (non-recycling), represent investment in unlisted equity interest of a
private entity incorporated in the PRC.
APPENDIX I ACCOUNTANTS’ REPORT
– I-50 –


--- page 588 ---
This entity is principally engaged in software development.
The Group designated these investments at FVOCI (non-recycling), as the investment is held for strategic
purposes. No dividends were received on this investment during the Track Record Periods. The analysis on the fair
value measurement of the above financial asset is disclosed in Note 30(e).
The changes in fair value in amount of RMB99,000, RMB44,000 and RMB211,000 (Note 30) which is net off
tax impact in amount of RMB84,000, RMB37,000 and RMB180,000 (Note 27(b)) is recognised in other
comprehensive income for the year (after tax).
18 FINANCIAL ASSETS MEASURED AT FAIR V ALUE THROUGH PROFIT OR LOSS
The Group and the Company
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Financial assets at FVPL
– Unlisted equity securities 20,000 28,337 28,595
In June 2021, the Group invested 3.95% of the equity interest in another private company, which is
incorporated in the PRC and principally engaged in the AI hardware manufacturing and sales, for a consideration of
RMB20,000,000 in cash.
The investment was classified as financial assets measured at FVPL, because the investment contain
substantive liquidation preference and are redeemable at the option of the Group if the investee is liquidated in the
future. The redeemable amount is calculated by investment consideration plus remaining net assets on pro rata basis.
For the years ended 31 December 2021, 2022 and 2023, the Group recognised RMB nil, RMB8,337,000 and
RMB258,000 in the changes in fair value of financial assets measured at fair value through profit or loss.
The analysis on the fair value measurement of the above financial asset is disclosed in Note 30(e).
19 INVENTORIES AND OTHER CONTRACT COSTS
The Group
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Communication devices 74,529 55,246 –
Servers and computers 37,306 30,742 593
Perception equipment and accessories – 8,134 5,561
Others 640 1,147 36
112,475 95,269 6,190------------
------------ ------------
Other contract cost – – 1,463
112,475 95,269 7,653
APPENDIX I ACCOUNTANTS’ REPORT
– I-51 –


--- page 589 ---
The Company
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Communication devices 74,529 55,246 –
Servers and computers 33,003 26,438 567
Perception equipment and accessories – 8,134 5,561
Others 640 1,147 36
108,172 90,965 6,164------------
------------ ------------
Other contract cost – – –
108,172 90,965 6,164
The analysis of the amount of inventories recognised as an expense and included in profit or loss is as follows:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Carrying amount of inventories sold 180,719 162,735 302,493
As at 31 December 2021, 2022 and 2023, inventories of RMB23,486,000, RMB nil and RMB nil were pledged
as security for issuance of letters of credit, respectively.
All inventories are expected to be recovered within one year.
Other contract costs are either the incremental costs of obtaining a contract with a customer or the costs to
fulfil a contract with a customer which are not capitalised as inventory. There was no impairment in relation to the
opening balance of capitalised costs or the costs capitalised during the year.
All of the other capitalised contract costs are expected to be recovered within one year.
20 TRADE AND OTHER RECEIV ABLES AND PREPAYMENTS
The Group
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade and other receivables
Trade receivables 248,068 379,103 704,682
Less: loss allowance on trade receivables (32,368) (66,479) (121,858)
215,700 312,624 582,824
Bills receivables 10,500 – –
226,200 312,624 582,824------------ ------------ ------------
APPENDIX I ACCOUNTANTS’ REPORT
– I-52 –


--- page 590 ---
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Value added tax (“V AT”) recoverable 9,296 16,661 13,430
Taxation recoverable (Note 27(a)) 1,104 8,896 650
Capitalization of listing expenses – – 3,564
Other deposit and receivable 6,212 1,493 2,237
242,812 339,674 602,705
Prepayments
Current
Prepayments for goods and services 95,296 139,219 233,834
Non-current
Prepayments for purchase of property, equipment
and intangible assets 63,009 24,460 145,002
Prepayments for services 9,900 9,900 34,954
72,909 34,360 179,956
The Company
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade receivables 227,199 327,468 636,899
Less: loss allowance on trade receivables (30,070) (53,434) (83,735)
197,129 274,034 553,164
Bills receivables 10,500 – –
207,629 274,034 553,164------------ ------------ ------------
Value added tax recoverable 6,795 10,966 9,673
Taxation recoverable 1,104 8,896 251
Amounts due from subsidiaries 23,067 67,238 69,188
Capitalization of listing expenses – – 3,564
Other deposit and receivable 5,152 1,491 1,494
36,118 88,591 84,170------------
------------ ------------
243,747 362,625 637,334
Current
Prepayments for goods and services 94,259 139,201 226,537
APPENDIX I ACCOUNTANTS’ REPORT
– I-53 –


--- page 591 ---
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current
Prepayments for purchase of property, equipment
and intangible assets 52,333 20,396 137,702
Prepayments for services – – 25,384
52,333 20,396 163,086
As at 31 December 2021, 2022 and 2023, except for the rental deposits of RMB3,173,000, RMB566,000 and
RMB921,000, respectively, all of the Group’s trade and other receivables are expected to be recovered or recognised
as expense within a year.
Bills receivable primarily represent short-term commercial acceptance bills receivable that entitle the Group
to receive the full face amount from the banks at maturity, which generally ranges from 6 to 12 months from the date
of issuance. Historically, the Group had experienced no credit losses on bills receivable.
Certain bills receivable were discounted to financial institutions with recourse, where substantially the risks
and rewards of ownership had not been transferred. Since the Group has continuing involvement in the transferred
assets, discounted bills receivable of RMB10,500,000, RMB nil and RMB nil, respectively, were therefore not
derecognized as at 31 December 2021, 2022 and 2023.
(a) Ageing analysis of trade receivables and bills receivables
As at 31 December 2021, 2022 and 2023, the ageing analysis of the Group’s trade receivables and bills
receivables, based on the invoice date and net of loss allowance, is as follows:
The Group
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Within 1 year 220,157 236,186 505,107
After 1 year but within 2 years 3,199 74,653 72,420
After 2 years but within 3 years 2,600 1,737 5,297
Over 3 years 244 48 –
226,200 312,624 582,824
Trade receivables are generally due within 180 to 270 days from the date of billing. Further details on the
Group’s credit policy and credit risk arising from trade receivables are set out in Note 30(a).
APPENDIX I ACCOUNTANTS’ REPORT
– I-54 –


--- page 592 ---
(b) Movement in the allowance for credit losses of trade receivables:
The Group
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Balance at the beginning of the year 14,924 32,368 66,479
Impairment losses recognised 17,444 42,562 55,379
Write-off – (8,451) –
Balance at the end of the year 32,368 66,479 121,858
21 CASH AND OTHER CASH FLOW INFORMATION
(a) Cash:
The Group
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cash at bank 10,641 20,434 46,876
The Company
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cash at bank 10,289 14,320 38,364
APPENDIX I ACCOUNTANTS’ REPORT
– I-55 –


--- page 593 ---
(b) Reconciliation of profit/(loss) before taxation to cash used in operations
Y ear ended 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Profit/(loss) before taxation 44,431 (90,884) (28,755)
Adjustments for:
Depreciation 6(c) 2,362 3,818 5,949
Amortization 6(c) 1,472 14,096 24,578
Impairment loss on trade receivables 20(b) 17,444 42,562 55,379
Changes in carrying amount of redeemable
capital contributions 26 25,950 157,504 146,892
Changes in fair value of financial assets
measured at fair value through
profit or loss 30 – (8,337) (258)
Finance costs 6(a) 8,213 9,065 11,769
Finance income 6(a) (30) (31) (73)
Net (gain)/loss on disposal of an associate 5 (200) – 41
Share of loss/(gain) of associates 16 22 (131) 20
(Gain)/loss on disposal of property and
equipment and right-of-use assets 5(b) – 16 (16)
Changes in working capital:
(Increase)/decrease in inventories and other
contract costs (9,541) 17,206 87,616
Increase in trade and other receivables (155,599) (131,632) (323,092)
Increase in prepayments (24,876) (43,923) (116,130)
Increase in trade and other payables 16,338 3,218 2,004
Increase in contract liabilities 14,217 4,395 66,296
Increase/(decrease) in deferred income 1,047 (176) 1,165
Cash used in operations (58,750) (23,234) (66,615)
APPENDIX I ACCOUNTANTS’ REPORT
– I-56 –


--- page 594 ---
(c) Reconciliation of liabilities arising from financing activities
The table below details changes in the Group’s liabilities from financing activities, including both cash and
non-cash changes. Liabilities arising from financing activities are liabilities for which cash flows were, or future cash
flows will be, classified in the Group’s consolidated cash flow statements as cash flows from financing activities.
Bank loans
and other
borrowings
Loans from
related
parties
Lease
liabilities
Redeemable
capital
contributions Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Note 24) (Note 33) (Note 25) (Note 26)
At 1 January 2021 98,001 2,349 9,284 99,316 208,950---------- ---------- ---------- ----------- ----------
Changes from financing
cash flows:
Proceeds from bank loans and
other borrowings 147,161 – – – 147,161
Repayment of bank loans and
other borrowings (94,499) – – – (94,499)
Proceeds from related parties
loans – 5,000 – – 5,000
Repayment of related parties
loans – (2,000) – – (2,000)
Capital element of lease
rentals paid – – (1,130) – (1,130)
Interest element of lease
rentals paid – – (374) – (374)
Proceeds from redeemable
capital contributions – – – 140,400 140,400
Interest paid (7,839) – – – (7,839)
Total changes from
financing cash flows 44,823 3,000 (1,504) 140,400 186,719---------- ---------- ---------- ----------- ----------
Other changes:
Increase in lease liabilities
from entering into new
leases during the year – – 762 – 762
Interest expenses
(Note 6(a)) 7,839 – 374 – 8,213
Changes in carrying
amount of redeemable
capital contributions – – – 25,950 25,950
Total other changes 7,839 – 1,136 25,950 34,925----------
--------- --------- ---------- ---------
At 31 December 2021 and
1 January 2022 150,663 5,349 8,916 265,666 430,594
APPENDIX I ACCOUNTANTS’ REPORT
– I-57 –


--- page 595 ---
Bank loans
and other
borrowings
Loans from
related parties
Lease
liabilities
Redeemable
capital
contributions
Capital
contribution
from an
investor Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Note 24) (Note 33) (Note 25) (Note 26) (Note 22)
At 1 January 2022 150,663 5,349 8,916 265,666 – 430,594------- ---------- ------- -- -------- -------- -- ----
Changes from financing cash
flows:
Proceeds from bank loans and other
borrowings 193,666 – – – – 193,666
Repayment of bank loans and other
borrowings (122,679) – – – – (122,679)
Repayment of related parties loans – (3,000) – – – (3,000)
Capital element of lease rentals paid – – (1,444) – – (1,444)
Interest element of lease rentals paid – – (403) – – (403)
Proceeds from redeemable capital
contributions – – – 104,800 – 104,800
Capital contribution from an investor – – – – 16,755 16,755
Interest paid (8,532) (2,479) – – – (11,011)
Total changes from financing
cash flows 62,455 (5,479) (1,847) 104,800 16,755 176,684------- ---------- ------- -- -------- -------- -- ----
Other changes:
Increase in lease liabilities from
entering into new leases during the
year – – 5,245 – – 5,245
Interest expenses (Note 6(a)) 8,532 130 403 – – 9,065
Changes in carrying amount of
redeemable capital contributions – – – 157,504 – 157,504
Total other changes 8,532 130 5,648 157,504 – 171,814-------
---------- ------- ---------- -------- ------
At 31 December 2022 221,650 – 12,717 527,970 16,755 779,092
APPENDIX I ACCOUNTANTS’ REPORT
– I-58 –


--- page 596 ---
Bank loans
and other
borrowings
Lease
liabilities
Redeemable
capital
contributions
Capital
contribution
from an
investor
Capitalization
of listing
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Note 24) (Note 25) (Note 26) (Note 22) (Note 22)
At 1 January 2023 221,650 12,717 527,970 16,755 – 779,092------- ------- --------- -------- -- -------- --------
Changes from financing cash
flows:
Proceeds from bank loans and other
borrowings 312,000 – – – – 312,000
Repayment of bank loans and other
borrowings (181,650) – – – – (181,650)
Capital element of lease rentals paid – (1,958) – – – (1,958)
Interest element of lease rentals paid – (637) – – – (637)
Proceeds from redeemable capital
contributions – – 161,295 – – 161,295
Payment for capitalization of listing
expenses – – – – (971) (971)
Interest paid (11,132) – – – – (11,132)
Total changes from financing cash
flows 119,218 (2,595) 161,295 – (971) 276,947------- ------- --------- -------- -- -------- --------
Other changes:
Increase in lease liabilities from
entering into new leases during
the year – 4,917 – – – 4,917
Interest expenses (Note 6(a)) 11,132 637 – – – 11,769
Disposal of right-of-use assets – (396) – – – (396)
Modification of right-of-use assets – 3,519 – – – 3,519
Changes in carrying amount of
redeemable capital contributions – – 163,647 (16,755) – 146,892
Total other changes 11,132 8,677 163,647 (16,755) – 166,701-------
------- --------- -------- ---------- --------
At 31 December 2023 352,000 18,799 852,912 – (971) 1,222,740
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 597 ---
(d) Total cash outflow for leases
Amounts included in the consolidated cash flow statements for leases comprise the following:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Within operating cash flows 128 23 71
Within financing cash flows 1,504 1,847 2,595
1,632 1,870 2,666
These amounts relate to the following:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Lease rentals paid 1,632 1,870 2,666
(e) Net cash outflow arising from the acquisition of a subsidiary
The recognised amounts of assets acquired and liabilities at the date of acquisition of the subsidiary comprise
the following:
(i) Yuanya Information acquisition
Fair value on
acquisition
RMB’000
Intangible assets
– Patents (Note 13) 8,600
Other receivables 1,995
Other payables and accruals (1,995)
Deferred tax liabilities (2,150)
Net identifiable assets acquired 6,450
Less: non-controlling interests (3,161)
Add: goodwill (Note 15) 17,111
Total acquisition price 20,400
Total consideration paid in cash 20,400
Less: cash of subsidiary acquired –
Net cash outflow arising from the acquisition of a subsidiary 20,400
APPENDIX I ACCOUNTANTS’ REPORT
– I-60 –


--- page 598 ---
(ii) Jinxun Digital Intelligence acquisition
Fair value on
acquisition
RMB’000
Intangible assets
– Patents (Note 13) 9,000
Cash 5,000
Deferred tax liabilities (2,250)
Net identifiable assets acquired 11,750
Less: non-controlling interests (5,757)
Add: goodwill (Note 15) 22,057
Total acquisition price 28,050
Less: consideration payable for Jinxun Digital Intelligence acquisition
(Note 22) (6,295)
Total consideration paid in cash 21,755
Less: cash of subsidiary acquired (5,000)
Net cash outflow arising from the acquisition of a subsidiary 16,755
22 TRADE AND OTHER PAYABLES
The Group
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade payables 6,635 3,306 14,402
Accrued payroll and benefits 4,421 6,607 8,493
Other taxes payable 958 1,777 3,680
Loans from related parties 5,349 – –
Capital contribution from an investor – 16,755 –
Consideration payable for Jinxun Digital
Intelligence acquisition – 6,295 3,000
Payable for acquisition of property and
equipment 15,152 7,148 6,557
Payable for acquisition of service 11,000 11,303 213
Accrual listing expenses – 4,400 5,829
Deposits received 60 61 60
Other payables and accrual expenses 2,943 1,781 1,155
46,518 59,433 43,389
APPENDIX I ACCOUNTANTS’ REPORT
– I-61 –


--- page 599 ---
The Company
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade payables 4,130 2,858 12,727
Accrued payroll and benefits 3,460 4,793 6,216
Other taxes payable 577 886 227
Amounts due from a subsidiary – 2,000 2,000
Loans from related parties 5,349 – –
Capital contribution from an investor – 16,755 –
Consideration payable for Jinxun Digital
Intelligence acquisition – 6,295 3,000
Payable for acquisition of property and
equipment 15,152 2,545 2,954
Payable for acquisition of service 11,000 11,303 –
Accrual listing expenses – 4,400 5,829
Deposits received 60 61 60
Other payables and accrual expenses 2,273 1,643 888
42,001 53,539 33,901
All of the trade and other payables are expected to be settled or recognised as income within one year.
As at 31 December 2021, 2022 and 2023, the ageing analysis of the Group’s trade payables, based on the
invoice date, is as follows:
The Group
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Within 6 months 5,697 674 13,806
After 6 months but within 1 year 5 552 477
After 1 year 933 2,080 119
6,635 3,306 14,402
APPENDIX I ACCOUNTANTS’ REPORT
– I-62 –


--- page 600 ---
23 CONTRACT LIABILITIES
The Group
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Balance at the beginning of the year 12,515 26,732 31,127
Decrease in contract liabilities as a result of
recognizing revenue during the year that was
included in the contract liabilities at the
beginning of the year (12,474) (23,043) (30,967)
Increase in contract liabilities as a result of
receiving advance payment during the year 80,113 58,370 132,644
Decrease in contract liabilities as a result of
recognising revenue during the same year (53,422) (30,932) (35,381)
Balance at the end of the year 26,732 31,127 97,423
The Company
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Balance at the beginning of the year 12,515 26,732 31,127
Decrease in contract liabilities as a result of
recognizing revenue during the year that was
included in the contract liabilities at the
beginning of the year (12,474) (23,043) (30,967)
Increase in contract liabilities as a result of
receiving advance payment during the year 80,113 58,370 132,162
Decrease in contract liabilities as a result of
recognising revenue during the same year (53,422) (30,932) (35,381)
Balance at the end of the year 26,732 31,127 96,941
Contract liabilities of the Group mainly arise from the non-refundable advance payments made by customers
while the underlying services are yet to be provided.
APPENDIX I ACCOUNTANTS’ REPORT
– I-63 –


--- page 601 ---
24 BANK LOANS AND OTHER BORROWINGS
The Group
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Current
Bank loans
– Unsecured and unguaranteed 10,000 10,000 30,000
– Secured and guaranteed (i) 118,000 201,650 312,000
– Pledged and unguaranteed (ii) 10,500 – –
138,500 211,650 342,000------------ ------------ ------------
Other borrowings
– Secured and guaranteed (iii) 3,063 – –
– Pledged and guaranteed (iv) 9,100 – –
12,163 – –------------
------------ ------------
150,663 211,650 342,000
Non-current
Bank loans
– Secured and guaranteed (i) – 10,000 10,000
– 10,000 10,000
The Company
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Current
Bank loans
– Unsecured and unguaranteed 10,000 10,000 30,000
– Secured and guaranteed (i) 118,000 201,650 310,000
– Pledged and unguaranteed (ii) 10,500 – –
138,500 211,650 340,000------------ ------------ ------------
Other borrowings
– Secured and guaranteed (iii) 3,063 – –
– Pledged and guaranteed (iv) 9,100 – –
12,163 – –------------
------------ ------------
150,663 211,650 340,000
APPENDIX I ACCOUNTANTS’ REPORT
– I-64 –


--- page 602 ---
(i) As at 31 December 2021, 2022 and 2023, certain bank facilities granted to the Group for bank loans
were guaranteed by Mr. Jinghua Tang, Mr. Qi Sun and Mr. Yerong Shi (collected referred to
“Shareholders”) as the shareholders of the Company and their spouses.
(ii) As at 31 December 2021, 2022 and 2023, bills receivables of the Group in the amount of
RMB10,500,000, RMB nil and RMB nil were pledged for the bank loans, respectively.
(iii) As at 31 December 2021, 2022 and 2023, the Group borrowed secured borrowings from third-party
leasing companies amounted to RMB3,063,000, RMB nil and RMB nil which were guaranteed by the
shareholders. The loans were repaid in 2022 and the guarantee was released.
(iv) As at 31 December 2021, 2022 and 2023, the Group borrowed secured borrowings from third-party
leasing companies amounted to RMB9,100,000, RMB nil and RMB nil. These loans were pledged by
the inventories with carrying amount of RMB23,486,000, RMB nil and RMB nil, respectively.
As at 31 December 2021, 2022 and 2023, certain secured borrowings from bank and third-party leasing
companies were guaranteed by Shareholders are listed as follows:
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Bank loans with guarantees issued by
Shareholders (i) 118,000 211,650 322,000
Other loans with guarantees issued by
Shareholders (iii)(iv) 12,163 – –
130,163 211,650 322,000
The maturity of the secured borrowings is ranging from 1 to 3 years. As at 31 December 2021, 2022 and 2023,
secured borrowings carried an interest rate ranging from 1.4% to 17.7% per annum.
As at 31 December 2021, 2022 and 2023, the Group had unutilized banking facilities for bank loans and bills
payable totaling RMB10,675,000, RMB56,350,000 and RMB101,000,000, respectively.
All above-mentioned guarantees by shareholders will be released before the completion of IPO date.
APPENDIX I ACCOUNTANTS’ REPORT
– I-65 –


--- page 603 ---
25 LEASE LIABILITIES
The following table shows the remaining contractual maturities of the Group’s lease liabilities as at
31 December 2021, 2022 and 2023.
The Group
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Within 1 year 2,302 4,128 8,115 ------------ ------------ ------------
After 1 year but within 2 years 1,917 3,152 4,652
After 2 years but within 5 years 4,697 5,437 6,028
After 5 years – – 4
6,614 8,589 10,684------------
------------ ------------
8,916 12,717 18,799
The Company
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Within 1 year 1,565 1,631 1,752 ------------ ------------ ------------
After 1 year but within 2 years 1,631 1,850 1,792
After 2 years but within 5 years 3,935 2,085 2,191
5,566 3,935 3,983------------ ------------ ------------
7,131 5,566 5,735
26 REDEEMABLE CAPITAL CONTRIBUTIONS
In 2020, the Company entered into investment agreements with Series A investors, pursuant to which, these
investors agreed to subscribe 4,960,000 shares of the Company at a consideration of RMB74,400,000 (referred as
“Series A Financing”).
Pursuant to the Series A investment agreements, two of Series A investors (“Series A-1 investor”) are entitled
to the redemption rights, liquidation preference and anti-dilution rights, while the remaining two Series A investors
(“Series A-2 investor”) are entitled to the liquidation preference and one director nomination rights for each
investors.
In 2021, the Company entered into investment agreements with Series B investors, pursuant to which, these
investors agreed to subscribe 3,510,000 shares of the Company at a consideration of RMB140,400,000 (referred as
“Series B Financing”).
In 2022, the Company entered into investment agreements with Series B+ investors, pursuant to which, these
investors agreed to subscribe 2,620,000 shares of the Company at a consideration of RMB104,800,000 (referred as
“Series B+ Financing”).
APPENDIX I ACCOUNTANTS’ REPORT
– I-66 –


--- page 604 ---
In 2023, the Company entered into investment agreements with Series C investors, pursuant to which, these
investors agreed to subscribe 2,769,230 shares of the Company at a consideration of RMB180,000,000 in which
2,739,230 shares of the Company at a consideration of RMB178,049,940 are entitled to the redemption rights,
liquidation preference and anti-dilution rights (referred as “Series C Investment”).
The Series A, Series B, Series B+ and Series C investors (collectively refer to “the investors”) are entitled to
the same voting rights and dividend rights as other founding shareholders of the Company. Certain key special rights
attributable to the investors of the investments are summarized as follows:
Redemption rights
Shares issued by the Company for the Series A-1, Series B, Series B+ and Series C shall be redeemable by the
Company and the founder of the Company upon the occurrence of certain events, with the main conditions being:
(i) a qualified IPO does not occur within 31 December 2024 for Series A-1, Series B, Series B+ and Series
C Financing.
(ii) the Company didn’t meet guaranteed profit from 2020 to 2025; or
(iii) changes to the Company’s controlling shareholder.
The redemption price of the shares issued in the investments shall equal to the higher of (i) the aggregate of
the original issue price for the respective series plus an amount accruing daily at 8% of the original preferred shares
issue price per annum minus all paid dividends (ii) fair market value of the shares of relevant series on the date of
redemption.
Liquidation preference
In the event of any liquidation including deemed liquidation, dissolution, bankruptcy, acquisitions, sale or
transfer of all or part of the core assets, winding up of the Company, the founder of the Company and the Company
shall ensure that the investors of the investments are entitled to receive, prior and in preference to any distribution
of any of the assets or surplus funds of the Company to founder in order of priority, an amount equals to the aggregate
of the original issue price for the respective series plus an amount declared but not paid dividends and the remaining
assets of the Company available for distribution shall be distributed rateably among the shareholders.
Anti-dilution right
If the Company increases its share capital at a price lower than the price paid by the investors of the
investments on a per share capital basis prior to a qualified IPO, the investors have a right to require the founding
shareholders of the Company to transfer for nil consideration to the investors, so that the total amount paid by the
investors divided by the total amount of share capital obtained is equal to the price per share capital in the new
issuance.
Presentation and classification
The Company recognized the financial instruments issued to investors as financial liabilities, because not all
triggering events mentioned in the key terms above are within the control of the Company and these financial
instruments did not meet the definition of equity for the Company. The financial liabilities are measured at the higher
amount expected to be paid to the investors upon redemption or liquidation which is assumed to be at the dates of
issuance and at the end of each reporting period. Any changes in the carrying amount of the financial liabilities were
recorded in “Changes in carrying amount of redeemable capital contributions”.
APPENDIX I ACCOUNTANTS’ REPORT
– I-67 –


--- page 605 ---
The movements of the redeemable capital contributions are set out below:
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 99,316 265,666 527,970
Changes in carrying amount of redeemable
capital contributions 25,950 157,504 146,892
Issuance for cash 140,400 104,800 178,050
At the ending of the year 265,666 527,970 852,912
The Company received advance payment of Series C financing proceeds in amount of RMB16,755,000 in 2022
which is recorded in the trade and other payables as at 31 December 2022.
The fair market value of the shares were valued by the directors of the Company with reference to valuation
reports carried out by an independent qualified professional valuer. The Company used discounted cash flow method
to determine the total share value of the Company and applied the equity allocation model to determine the fair
market value of the shares of relevant series at the end of each reporting period upon redemption.
Key valuation assumptions used to determine the fair market value of the shares are as follows:
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Discount rate 14.7% 14.4% 14.4%
Discounts for lack of marketability (“DLOM”) 19.0% 14.0% 7.0%
If the Company’s significant unobservable inputs applied in the valuation had been 1% lower or higher than
management’s estimation as at 31 December 2021, 2022 and 2023, the present value of the redeemable preferred
shares would increase/(decrease) by the amounts listed in table below:
As at 31 December 2021
DLOM Discount rate
RMB’000 RMB’000
Impact on the profit/(loss) before income tax due to estimated
changes in carrying amount of redeemable capital contributions
Add 1% 204 751
Reduce 1% (204) (869)
As at 31 December 2022
DLOM Discount rate
RMB’000 RMB’000
Impact on the profit/(loss) before income tax due to estimated
changes in carrying amount of redeemable capital contributions
Add 1% 4,956 38,772
Reduce 1% (3,673) (46,196)
APPENDIX I ACCOUNTANTS’ REPORT
– I-68 –


--- page 606 ---
As at 31 December 2023
DLOM Discount rate
RMB’000 RMB’000
Impact on the profit/(loss) before income tax due to estimated
changes in carrying amount of redeemable capital contributions
Add 1% 7,656 67,339
Reduce 1% (7,658) (86,700)
27 INCOME TAX IN THE CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(a) Current taxation in the consolidated statements of financial position represents:
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 7,079 1,793 (6,006)
Provision for PRC Corporate Income Tax for the
year 11,042 81 9,979
Tax paid (16,328) (7,880) (1,454)
At the end of the year 1,793 (6,006) 2,519
Represented by:
Taxation recoverable (Note 20) (1,104) (8,896) (650)
Taxation payable 2,897 2,890 3,169
1,793 (6,006) 2,519
APPENDIX I ACCOUNTANTS’ REPORT
– I-69 –


--- page 607 ---
(b) Deferred tax assets and liabilities recognized:
(i) The components of deferred tax assets/(liabilities) recognized in the consolidated statements of financial position and the movements during t he Track Record Periods
are as follows:
Credit
loss
allowance
Deferred
income
Right-of-
use assets
Lease
Liabilities
Deductible
tax losses
Financial
assets at fair
value through
other
comprehensive
income
Financial
assets
measured
at fair
value
through
profit or
loss
Appraisal
of
intangible
asset
appreciation
Depreciation
of fixed
assets Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2021 2,238 – 136 (49) – (17) – – – 2,308
Charged/(credited) profit or loss 2,653 166 218 (176) – – – 134 – 2,995
Charged to reserves ––––– 1 5– – – 1 5
Acquisition of subsidiaries ––––– –– (2,150) – (2,150)
At 31 December 2021 and 1
January 2022 4,891 166 354 (225) – (2) – (2,016) – 3,168
Charged/(credited) to profit or loss 7,285 (35) 338 (213) 6,454 – (1,250) 292 (7,717) 5,154
Credited to reserves ––––– ( 7 ) – – – ( 7 )
Acquisition of subsidiaries ––––– –– (2,250) – (2,250)
At 31 December 2022 and 1
January 2023 12,176 131 692 (438) 6,454 (9) (1,250) (3,974) (7,717) 6,065
Charged/(credited) to profit or loss 10,432 175 526 (224) (2,479) – (39) 1,142 – 9,533
Credited to reserves ––––– (31) – – – (31)
At 31 December 2023 22,608 306 1,218 (662) 3,975 (40) (1,289) (2,832) (7,717) 15,567
APPENDIX I ACCOUNTANTS’ REPORT
– I-70 –


--- page 608 ---
(ii) The components of deferred tax/(liabilities) recognized in the statements of financial position and the movements during the Track Record Peri ods are as follows
Credit
loss
allowance
Deferred
income
Right-of-
use assets
Lease
Liability
Deductible
tax losses
Financial
assets at fair
value through
other
comprehensive
income
Financial
assets
measured
at fair
value
through
profit or
loss
Depreciation
of fixed
assets Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2021 2,238 – 136 (49) – (17) – – 2,308
Charged/(credited) to profit or loss 2,272 166 218 (176) – – – – 2,480
Charged to reserves ––––– 1 5– – 1 5
At 31 December 2021 and 1 January 2022 4,510 166 354 (225) – (2) – – 4,803
Charged/(credited) to profit or loss 4,772 (35) 231 (235) 6,443 – (1,250) (7,717) 2,209
Credited to reserves ––––– ( 7 ) – – ( 7 )
At 31 December 2022 and 1 January 2023 9,282 131 585 (460) 6,443 (9) (1,250) (7,717) 7,005
Charged/(credited) to profit or loss 4,544 175 242 (242) (6,443) – (39) – (1,763)
Credited to reserves ––––– (31) – – (31)
At 31 December 2023 13,826 306 827 (702) – (40) (1,289) (7,717) 5,211
APPENDIX I ACCOUNTANTS’ REPORT
– I-71 –


--- page 609 ---
(iii) Reconciliation to the consolidated statements of financial position:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Net deferred tax asset recognised in the
consolidated statement of financial position 5,184 10,038 18,399
Net deferred tax liability recognised in the
consolidated statement of financial position (2,016) (3,973) (2,832)
Net deferred tax asset recognized in the
consolidated statement of financial position 3,168 6,065 15,567
(c) Deferred tax assets not recognized
In accordance with the accounting policy set out in Note 2(t), the Group has not recognised deferred tax assets
in respect of unused tax losses and temporary differences as it is not probable that future taxable profits against which
the losses can be utilised will be available in the relevant tax jurisdiction and entity. The following table presents the
Group’s unused tax losses and temporary differences at the reporting dates:
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Deductible temporary differences 1,109 2,176 1,850
Unused tax losses 3,566 8,698 15,865
4,675 10,874 17,715
The expiration information of the Group’s unused tax losses is set out below:
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
2025 812 812 812
2026 2,754 2,754 2,754
2027 – 5,132 5,131
2028 – – 7,167
3,566 8,698 15,865
APPENDIX I ACCOUNTANTS’ REPORT
– I-72 –


--- page 610 ---
28 DEFERRED INCOME
As at 31 December 2021, 2022 and 2023, deferred income of the Group and the Company represented
unamortized conditional government grants amounted to RMB1,047,000, RMB871,000 and RMB2,036,000 for the
purchase of research and development equipment.
We recognize government grants in the consolidated statement of financial position initially when there is
reasonable assurance that they will be received and that we will comply with the conditions attaching to them. Grants
that compensate us for expenses incurred are recognized as income in profit or loss on a systematic basis in the same
periods in which the expenses are incurred. Grants that compensate us for the cost of an asset are recognized initially
as deferred income and amortized to profit or loss on a straight-line basis over the useful life of the asset by way of
being recognized in other income.
29 CAPITAL AND RESERVES
(a) Movements in components of equity
The reconciliation between the opening and closing balances of each component of the Group’s consolidated
equity is set out in the consolidated statement of changes in equity. Details of the changes in the Company’s
individual components of equity between the beginning and the end of the year are set out below:
The Company
Note
Share
capital
Capital
reserve
PRC
statutory
reserves
Fair value reserve
(non-recycling)
Retained
earnings/
(Accumulated
losses) Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Balance at 1 January 2021 22,160 (4,819) 5,343 98 48,090 70,872------ ------ ------ ------------ --------- --------
Changes in equity for 2021:
Profit for the year – – – – 31,523 31,523
Other comprehensive
income – – – (84) – (84) ------ ------ ------ ------------ --------- --------
Total comprehensive income
for the year – – – (84) 31,523 31,439
Issue of ordinary shares 29(c) 3,510 136,890 – – – 140,400
Recognition of redeemable
capital contributions as
current liabilities 26 – (140,400) – – – (140,400)
Appropriation for surplus
reserve – – 3,152 – (3,152) – ------
------ ------ ------------ --------- --------
Balance at 31 December
2021 and 1 January 2022 25,670 (8,329) 8,495 14 76,461 102,311------ ------ ------ ------------ --------- --------
APPENDIX I ACCOUNTANTS’ REPORT
– I-73 –


--- page 611 ---
Note
Share
capital
Capital
reserve
PRC
statutory
reserves
Fair value reserve
(non-recycling)
Retained
earnings/
(Accumulated
losses) Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Changes in equity for 2022:
Loss for the year – – – – (77,004) (77,004)
Other comprehensive
income – – – 37 – 37
Total comprehensive income
for the year – – – 37 (77,004) (76,967) ------ ------ ------ ------------ --------- --------
Issue of ordinary shares 29(c) 2,620 102,180 – – – 104,800
Recognition of redeemable
capital contributions as
current liabilities 26 – (104,800) – – – (104,800)------
------ ------ ------------ --------- --------
Balance at 31 December
2022 and 1 January 2023 28,290 (10,949) 8,495 51 (543) 25,344
Changes in equity for 2023:
Loss for the year – – – – (17,664) (17,664)
Other comprehensive
income – – – 180 – 180
Total comprehensive income
for the year – – – 180 (17,664) (17,484) ------ ------ ------ ------------ --------- --------
Issue of ordinary shares 2,769 177,231 – – – 180,000
Recognition of redeemable
capital contributions as
current liabilities – (178,050) – – – (178,050)------
------ ------ ------------ --------- --------
Balance at 31 December
2023 31,059 (11,768) 8,495 231 (18,207) 9,810
(b) Dividends
No dividends were paid or declared by the Company or any of its subsidiaries during the Track Record Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-74 –


--- page 612 ---
(c) Share capital
Note Number of shares In RMB’000
Ordinary shares, issued and fully paid:
At 1 January 2021 22,160,000 22,160
Ordinary shares issued (i) 3,510,000 3,510
At 31 December 2021 and 1 January 2022 25,670,000 25,670
Ordinary shares issued (ii) 2,620,000 2,620
At 31 December 2022 28,290,000 28,290
Ordinary shares issued (iii) 2,769,230 2,769
At 31 December 2022 and 31 December
2023 31,059,230 31,059
(i) In 2021, the Company entered into an investment agreement with certain investors, pursuant to which,
these investors agreed to invest RMB140,400,000 in the Company in exchange of 3,510,000 shares of
the Company. During the year ended 31 December 2021, the share capital of the Company increased
from RMB22,160,000 to RMB25,670,000 by issue of additional 3,510,000 ordinary shares at RMB1 per
share.
(ii) In 2022, the Company entered into an investment agreement with certain investors, pursuant to which,
these investors agreed to invest RMB104,800,000 in the Company in exchange of 2,620,000 shares of
the Company. During the year ended 31 December 2022, the share capital of the Company increased
from RMB25,670,000 to RMB28,290,000 by issue of additional 2,620,000 ordinary shares at RMB1 per
share.
(iii) In 30 June 2023, the Company entered into an investment agreement with certain investors, pursuant to
which, these investors agreed to invest RMB179,999,940 in the Company in exchange of 2,769,230
shares of the Company. During the year ended 31 December 2023, the share capital of the Company
increased from RMB28,290,000 to RMB31,059,230 by issue of additional 2,769,230 ordinary shares at
RMB1 per share.
(d) Capital reserve
The capital reserve represents (i) the difference between consideration received for ordinary shares
subscription net of any transaction costs directly attributable to the subscription and the par value of the ordinary
shares subscribed; (ii) the amount arises from the adjustment of redeemable capital contributions as current liabilities.
(e) PRC statutory reserve
Statutory reserve is established in accordance with the relevant PRC rules and regulations and the articles of
association of the companies comprising the Group which are incorporated in the PRC.
For the entity concerned, statutory reserves can be used to make good previous years’ losses, if any, and may
be converted into capital in proportion to the existing equity interests of investors, provided that the balance of the
reserve after such conversion is not less than 25% of the entity’s registered capital.
(f) Fair value reserve (non-recycling)
The fair value reserve (non-recycling) 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 the reporting period (see Note 2(f)).
APPENDIX I ACCOUNTANTS’ REPORT
– I-75 –


--- page 613 ---
(g) Capital management
The Group’s primary objectives when managing capital are to safeguard the Group’s ability to continue as a
going concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders, by
pricing products and services commensurately with the level of risk and by securing access to finance at a reasonable
cost.
The Group actively and regularly reviews and manages its capital structure to maintain a balance between the
higher shareholder returns that might be possible with higher levels of borrowings and the advantages and security
afforded by a sound capital position, and makes adjustments to the capital structure in light of changes in economic
conditions.
The Group monitors its capital structure on the basis of an adjusted net debt-to-capital ratio. For this purpose,
adjusted net debt is defined as total debt (which includes interest-bearing loans and borrowings, and lease liabilities
but excludes redeemable capital contributions) less cash. Adjusted capital comprises all components of equity and
redeemable capital contributions.
The Group’s adjusted net debt-to-capital ratio as at 31 December 2021, 2022 and 2023 and were as follows:
Y ears ended 31 December
Note 2021 2022 2023
RMB’000 RMB’000 RMB’000
Current liabilities:
Bank loans and other borrowings 24 150,663 211,650 342,000
Loans from related parties 33 5,349 – –
Lease liabilities 25 2,302 4,128 8,115
158,314 215,778 350,115----------- ----------- -----------
Non-current liabilities:
Bank loans and other borrowings 24 – 10,000 10,000
Lease liabilities 25 6,614 8,589 10,684
6,614 18,589 20,684----------- ----------- -----------
Total debt 164,928 234,367 370,799
Less: Cash 21(a) (10,641) (20,434) (46,876)
Adjusted net debt 154,287 213,933 323,923
Total equity 109,760 34,643 7,572
Add: Redeemable capital contributions 26 265,666 527,970 852,912
Adjusted capital 375,426 562,613 860,484
Adjusted net debt-to-capital ratio 41.1% 38.0% 37.6%
APPENDIX I ACCOUNTANTS’ REPORT
– I-76 –


--- page 614 ---
30 FINANCIAL RISK MANAGEMENT AND FAIR V ALUES OF FINANCIAL INSTRUMENTS
Exposure to credit, liquidity, interest rate and currency risks arises in the normal course of the Group’s
business.
The Group’s exposure to these risks and the financial risk management policies and practices used by the
Group to manage these risks are described below.
(a) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a
financial loss to the Group. The Group’s credit risk is primarily attributable to trade receivables and other receivables.
The Group’s exposure to credit risk arising from cash are limited because the counterparties are reputable banks or
financial institution, which the Group considered to present low credit risks. The Group’s exposure to credit risk
arising from refundable rental deposits is considered to be low, taking into account (i) the landlords’ credit rating and
(ii) the remaining lease term and the period covered by the rental deposits. Management has a credit policy in place
and the exposure to credit risk is monitored on an ongoing basis.
The Group’s exposure to credit risk arising from trade receivables is influenced mainly by the individual
characteristics of each customer. The default risk of the industry or country in which the customers operate also has
an influence on credit risk. As at 31 December 2021, 2022 and 2023, 53.8%, 51.7% and 36.1% of the total trade
receivables were due from the Group’s top five largest customers. Trade receivables are generally due within 180 to
270 days from the date of billing.
Individual credit evaluations are performed on all customers requiring credit over a certain amount. These
evaluations focus on the customer’s past history of making payments when due and current ability to pay, taking into
account information specific to the customer as well as pertaining to the economic environment in which the customer
operates.
The Group measures loss allowances for trade receivables at lifetime ECL. The Group determines ECL by
using a provision matrix, estimated based on historical credit loss experience, the past default experience of the
debtor, general economic conditions of the industry and country in which the debtors operates and an assessment of
both the current and the forecast duration of condition as at 31 December 2021, 2022 and 2023. As the Group’s
historical credit loss experience does not indicate significantly different loss patterns for different customer segments,
the loss allowance based on past due status is not further distinguished among the Group’s different customer bases.
The following table provides information about the Group’s exposure to credit risk and ECLs for trade
receivables, including trade-related balances in amounts due from related parties, as at 31 December 2021, 2022 and
2023:
As at 31 December 2021
Expected
loss rate
Gross carrying
amount Loss allowance
% RMB’000 RMB’000
Current (not past due) 7.7% 209,856 16,095
Less than 12 months past due 33.6% 27,773 9,326
More than 12 months but less than
24 months past due 58.4% 7,760 4,528
More than 24 months but less than
36 months past due 83.4% 1,563 1,303
More than 36 months past due 100.0% 1,116 1,116
248,068 32,368
APPENDIX I ACCOUNTANTS’ REPORT
– I-77 –


--- page 615 ---
As at 31 December 2022
Expected
loss rate
Gross carrying
amount Loss allowance
% RMB’000 RMB’000
Current (not past due) 7.9% 221,075 17,553
Less than 12 months past due 27.6% 137,776 37,998
More than 12 months but less than
24 months past due 51.5% 18,359 9,456
More than 24 months but less than
36 months past due 76.0% 1,755 1,334
More than 36 months past due 100.0% 138 138
379,103 66,479
As at 31 December 2023
Expected
loss rate
Gross carrying
amount Loss allowance
% RMB’000 RMB’000
Current (not past due) 10.7% 491,480 52,433
Less than 12 months past due 26.4% 177,186 46,837
More than 12 months but less than
24 months past due 60.9% 33,882 20,634
More than 24 months but less than
36 months past due 91.0% 1,996 1,816
More than 36 months past due 100.0% 138 138
704,682 121,858
Expected loss rate are based on actual loss experience over the past 4 years. These rates are adjusted to reflect
differences in economic conditions during the period over which the historical data has been collected, current
conditions and the Group’s view of economic conditions over expected lives of the receivables.
The following significant changes in the gross carrying amounts of trade receivables contributed to the change
in the loss allowance during the 2021, 2022 and 2023:
– origination of new trade receivables net of those settled resulted in an increase of RMB10,048,000,
RMB1,458,000 and RMB34,880,000 in loss allowance, respectively;
– change in past due trade receivables resulted in an increase of RMB7,396,000, RMB41,104,000 and
RMB20,499,000 in loss allowance, respectively; and
– write-off of trade receivables with a gross carrying amount of RMB nil, RMB8,451,000 and RMB nil
resulted in a decrease in loss allowance, respectively.
(b) Liquidity risk
The management are responsible for their own cash management, including the short-term investment of cash
surpluses and the raising of loans to cover expected cash demands, subject to approval by the parent company’s board
when the borrowings exceed certain predetermined levels of authority. The Group’s policy is to regularly monitor its
liquidity requirements and its compliance with lending covenants, to ensure that it maintains sufficient reserves of
cash and readily realizable marketable securities and adequate committed lines of funding from major financial
institutions to meet its liquidity requirements in the short and longer term.
APPENDIX I ACCOUNTANTS’ REPORT
– I-78 –


--- page 616 ---
The following tables show the remaining contractual maturities at the end of each reporting period of the
Group’s financial liabilities, which are based on contractual undiscounted cash flows (including interest payments
computed using contractual rates or, if floating, based on rates current at the reporting date) and the earliest date the
Group can be required to pay:
As at 31 December 2021
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 Total
Carrying
amount
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Bank loans and
other borrowings 154,67 2––– 154,672 150,663
Trade and other
payables 45,69 0––– 45,690 45,690
Lease liabilities 2,617 2,155 4,924 – 9,696 8,916
Redeemable capital
contributions 265,66 6––– 265,666 265,666
468,645 2,155 4,924 – 475,724 470,935
As at 31 December 2022
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 Total
Carrying
amount
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Bank loans and
other borrowings 216,433 700 10,700 – 227,833 221,650
Trade and other
payables 57,65 6––– 57,656 57,656
Lease liabilities 4,549 3,451 5,676 – 13,676 12,717
Redeemable capital
contributions 527,97 0––– 527,970 527,970
806,608 4,151 16,376 – 827,135 819,993
As at 31 December 2023
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 Total
Carrying
amount
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Bank loans and
other borrowings 348,553 10,700 – – 359,253 352,000
Trade and other
payables 39,70 9––– 39,709 39,709
Lease liabilities 8,690 5,008 6,192 4 19,894 18,799
Redeemable capital
contributions 852,91 2––– 852,912 852,912
1,249,864 15,708 6,192 4 1,271,768 1,263,420
APPENDIX I ACCOUNTANTS’ REPORT
– I-79 –


--- page 617 ---
(c) Interest rate risk
The Group’s interest-bearing financial instruments at variable rates are the cash at bank as at 31 December
2021, 2022 and 2023. The Group’s interest-bearing financial instruments at fixed interest rates are loans and
borrowings as at 31 December 2021, 2022 and 2023 that are measured at amortised cost.
The Group’s income and operating cash flows are substantially independent of exchanges in market interest
rates and the Group has no significant interest-bearing assets except for cash.
(d) Currency risk
As at 31 December 2021, 2022 and 2023, the Group is not exposed to significant foreign currency risk since
financial assets and liabilities denominated in currencies other than the functional currencies of the Company and its
subsidiaries are not significant.
(e) Fair value measurement
(i) Financial assets and liabilities measured at fair value
Fair value hierarchy
The following table presents the fair value of the Group’s financial instruments measured at the
end of the reporting period on a recurring basis, categorized into the three-level fair value hierarchy as
defined in IFRS 13, Fair value measurement. The level into which a fair value measurement is classified
is determined with reference to the observability and significance of the inputs used in the valuation
technique as follows:
Level 1 valuations: Fair value measured using only Level 1 inputs i.e. unadjusted quoted
prices in active markets for identical assets or liabilities at the
measurement date;
Level 2 valuations: Fair value measured using Level 2 inputs i.e. observable inputs which
fail to meet Level 1, and not using significant unobservable inputs.
Unobservable inputs are inputs for which market data are not available;
Level 3 valuations: Fair value measured using significant unobservable inputs.
Analysis on fair value measurement of financial instruments as at 31 December 2021, 2022 and
2023 are as follows:
Fair value at
31 December
2021
Fair value measurement at 31 December
2021 categorized into
Level 1 Level 2 Level 3
RMB’000 RMB’000 RMB’000 RMB’000
Recurring fair value
measurement
Assets:
Financial assets at
FVOCI
– Unlisted equity
securities (i) 516 – – 516
Financial assets at
FVPL
– Unlisted equity
securities (ii) 20,000 – – 20,000
20,516 – – 20,516
Liability:
Redeemable capital
contributions (iii) 265,666 – – 265,666
APPENDIX I ACCOUNTANTS’ REPORT
– I-80 –


--- page 618 ---
Fair value at
31 December
2022
Fair value measurement at 31 December
2022 categorized into
Level 1 Level 2 Level 3
RMB’000 RMB’000 RMB’000 RMB’000
Recurring fair value
measurement
Assets:
Financial assets at
FVOCI
– Unlisted equity
securities (i) 560 – – 560
Financial assets at
FVPL
– Unlisted equity
securities (ii) 28,337 – – 28,337
28,897 – – 28,897
Liability:
Redeemable capital
contributions (iii) 527,970 – – 527,970
Fair value at
31 December
2023
Fair value measurement at 31 December
2023 categorized into
Level 1 Level 2 Level 3
RMB’000 RMB’000 RMB’000 RMB’000
Recurring fair value
measurement
Assets:
Financial assets at
FVOCI
– Unlisted equity
securities (i) 771 – – 771
Financial assets at
FVPL
– Unlisted equity
securities (ii) 28,595 – – 28,595
29,366 – – 29,366
Liability:
Redeemable capital
contributions (iii) 852,912 – – 852,912
During the years ended 31 December 2021, 2022 and 2023, there were no transfers, or transfers
into or out of Level 3. The Group’s policy is to recognize transfers between levels of fair value hierarchy
as at the end of the reporting period in which they occur.
APPENDIX I ACCOUNTANTS’ REPORT
– I-81 –


--- page 619 ---
Information about Level 3 fair value measurements:
Valuation techniques
Significant
unobservable inputs
Unlisted equity securities (i) The comparable company
approach (Note i)
DLOM
Unlisted equity securities (ii) The adjusted latest round
financing price approach
(Note ii)
Changing trend of average
market multiples of
comparable companies
Redeemable capital
contributions (iii)
Discounted cash flow
(Note iii)
DLOM and Discount rate
(i) The fair value of certain unlisted equity security is determined average market multiples
of comparable companies. As at 31 December 2021, 2022 and 2023, it is estimated that
with all other variables held constant, an increase/decrease in change of DLOM by 5%
would have decreased/increased the Group’s other comprehensive income by RMB37,000,
RMB39,000 and RMB39,000, respectively.
(ii) The fair value of certain unlisted equity security is determined using latest round financing
price adjusted for changing trend of average market multiples of comparable companies.
The fair value measurement is positively correlated to the changing trend of average
market multiples of comparable companies. As at 31 December 2021, 2022 and 2023, it is
estimated that with all other variables held constant, an increase/decrease in change of
average market multiples of comparable companies by 5% would have increased/decreased
the Group’s profit by RMB1,000,000, decreased/increased the Group’s loss by
RMB2,518,000 and decreased/increased the Group’s loss by RMB1,512,000, respectively.
(iii) The sensitivity analysis for redeemable capital contributions was disclosed in Note 26.
The following table shows a reconciliation from the beginning balances to the ending balances
of financial assets for fair value measurement in Level 3 of the fair value hierarchy:
Financial
assets at FVOCI
Financial
assets at FVPL Total
RMB’000 RMB’000 RMB’000
As at 1 January 2021 615 – 615
Purchase – 20,000 20,000
Net realized and unrealized gains
on financial assets at fair value
other comprehensive income (99) – (99)
As at 31 December 2021 516 20,000 20,516
Net realized and unrealized gains
on financial assets at fair value
other comprehensive income 44 – 44
Net realized and unrealized losses
on financial liabilities at fair
value through profit or loss – 8,337 8,337
APPENDIX I ACCOUNTANTS’ REPORT
– I-82 –


--- page 620 ---
Financial
assets at FVOCI
Financial
assets at FVPL Total
RMB’000 RMB’000 RMB’000
As at 31 December 2022 560 28,337 28,897
Net realized and unrealized gains
on financial assets at fair value
other comprehensive income 211 – 211
Net realized and unrealized losses
on financial liabilities at fair
value through profit or loss – 258 258
As at 31 December 2023 771 28,595 29,366
The changes of redeemable capital contributions for the years ended 31 December 2021, 2022 and
2023 have been presented in Note 26.
Any gain or loss arising from the remeasurement of the Group’s unlisted equity securities held
for strategic purposes are recognized in the fair value reserve (non-recycling) in other comprehensive
income.
Upon disposal of the equity securities, the amount accumulated in other comprehensive income
is transferred directly to accumulated losses.
The gains arising from the financial assets at FVPL are presented in the “Changes in fair value
of financial assets measured at fair value through profit or loss” line item in the consolidated statements
of profit or loss.
All financial instruments carried at cost or amortized cost are at amounts not materially different
from their values as at 31 December 2021, 2022 and 2023.
31 COMMITMENTS
Commitments outstanding at 31 December 2021, 2022 and 2023 not provided for in the financial statements
were as follows:
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Purchase of network and other
telecommunication resource costs 424,246 291,400 180,306
Purchase of property, equipment and
intangible assets 19,833 68,236 95,300
32 CONTINGENT LIABILITIES
As at 31 December 2021, 2022 and 2023, the Group does not have any material contingent liabilities.
APPENDIX I ACCOUNTANTS’ REPORT
– I-83 –


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33 MATERIAL RELATED PARTY TRANSACTIONS
(a) Key management personnel remuneration
Remuneration for key management personnel of the Group, including amounts paid to the Company’s directors
as disclosed in Note 8 and certain of the highest paid employees as disclosed in Note 9, is as follows:
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
Short-term employee benefits 4,173 5,973 8,167
Contributions to defined contribution
retirement plans 278 382 497
4,451 6,355 8,664
Total remuneration is included in “staff costs” (see Note 6(b)).
(b) Related party transactions
During the Track Record Periods, the directors are of the view that the following personals and companies are
related parties:
Name of party Relationship
Jinghua Tang Founder of the Company and Shareholder
Qi Sun Shareholder
Yerong Shi* Shareholder
Shanghai Chenqi Information Consulting
Co., Ltd.**
The entity controlled by Yerong Shi
Shanghai V oicecomm Rongzhi Technology Group
Co., Ltd.**
The entity controlled by Jinghua Tang
QianHai (ShangHai) Technology Inc., Co.** The entity controlled by Tiantian Ma
* On 23 August 2021, Yerong Shi and Jinghua Tang signed the agreement to cease Yerong Shi acting in
concert with Jinghua Tang. Yerong Shi was not being related parties from the ceasing date.
** The English translation of these entities is for reference only. The official names of the entities
established in the PRC are in Chinese.
(c) Guarantees and pledges issued by related parties
Certain bank facilities granted to the Group were guaranteed or secured with pledges issued by related parties.
An analysis of the carrying value of these liabilities in Note 24.
APPENDIX I ACCOUNTANTS’ REPORT
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(d) Significant related party transactions
During the years ended 31 December 2021, 2022 and 2023, the Group had following transactions with related
parties:
Trade in nature
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
– Purchase from
QianHai (ShangHai) Technology Inc., Co. (i) – – 14,708
Non-trade in nature
Y ears ended 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
– Loan and advance to relate party
Jinghua Tang (ii) 3,000 – –
Shanghai Chenqi Information Consulting
Co., Ltd. (ii) 2,000 – –
5,000 – –
– Repayment of related parties loans
Jinghua Tang (ii) – 3,130 –
Yerong Shi (ii) – 2,349 –
Shanghai Chenqi Information Consulting
Co., Ltd. (ii) 2,000 – –
2,000 5,479 –
– Disposal of interests in associates
Shanghai V oicecomm Rongzhi Technology Group
Co., Ltd. (Note 16) – – 2,000
– Expenses paid on behave of shareholders
Yerong Shi – – 684
Jinghua Tang – – 26
– – 710
– Repayment of company advances
Yerong Shi – – 684
Jinghua Tang – – 26
– – 710
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 623 ---
(i) The Group purchased hardware and software for fulfilment of sales contract.
(ii) The Group’s related party transactions are based on the Group’s financing arrangements. The interest
rates on related party borrowings do not compare unfavorably with market terms.
(e) Significant related party balances
At 31 December 2021, 2022 and 2023, the Group had following balances with related parties:
Trade in nature
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
– Prepayment-current
QianHai (ShangHai) Technology Inc., Co. – – 386
Non-trade in nature
As at 31 December
2021 2022 2023
RMB’000 RMB’000 RMB’000
– Other payables and accruals
Jinghua Tang 3,000 – –
Yerong Shi 2,349 – –
5,349 – –
34 BUSINESS COMBINATIONS
(i) Yuanya Information acquisition
On 19 July 2021, the Company acquired 51% equity interests in Yuanya Information from a third party at a
cash consideration of RMB20,400,000 to enhance the Group’s service capabilities in vehicle sector.
From the dates of acquisitions to 31 December 2021, Yuanya Information contributed revenue of
RMB11,291,000 and net profit of RMB1,197,000, respectively. During the year ended 31 December 2021, Yuanya
Information contributed revenue of RMB11,291,000 and net profit of RMB1,197,000, respectively, had the
acquisition been completed as at 1 January 2021.
APPENDIX I ACCOUNTANTS’ REPORT
– I-86 –


--- page 624 ---
The following table summarizes the estimated fair value of the assets acquired and liabilities assumed at the
respective dates of acquisitions:
Fair value on
acquisition
RMB’000
Purchase consideration
Total acquisition price 20,400
Identifiable assets and liabilities:
Other receivables 1,995
Intangible assets
– Patents 8,600
Other payables and accruals (1,995)
Deferred tax liabilities (2,150)
Net identifiable assets acquired 6,450
Less: non-controlling interests (3,161)
Add: goodwill (Note 15) 17,111
Net assets acquired 20,400
(ii) Jinxun Digital Intelligence acquisition
On 30 December 2022, the Company acquired 51% equity interests in Jinxun Digital Intelligence from a third
party at a cash consideration of RMB28,050,000 to enhance the Group’s service capabilities in voice communication
sector.
From the dates of acquisitions to 31 December 2022, Jinxun Digital Intelligence contributed revenue of RMB
nil and net profit of RMB nil, respectively. During the year ended 31 December 2022, Jinxun Digital Intelligence
contributed revenue of RMB nil and net profit of RMB nil, respectively, had the acquisition been completed as at 1
January 2022.
The following table summarizes the estimated fair value of the assets acquired and liabilities assumed at the
respective dates of acquisitions:
Fair value on
acquisition
RMB’000
Purchase consideration
Total acquisition price 28,050
Identifiable assets and liabilities:
Intangible assets
– Patents 9,000
Cash 5,000
Deferred tax liabilities (2,250)
Net identifiable assets acquired 11,750
Less: non-controlling interests (5,757)
Add: goodwill (Note 15) 22,057
Net assets acquired 28,050
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 625 ---
35 IMMEDIATE AND ULTIMATE CONTROLLING PARTY
As at 31 December 2021, 2022 and 2023, the directors consider the immediate controlling parties of the Group
to be Jinghua Tang and his concert parties, and ultimate controlling party of the Group to be Jinghua Tang.
36 POSSIBLE IMPACT OF AMENDMENTS, NEW STANDARDS AND INTERPRETATIONS ISSUED
BUT NOT YET EFFECTIVE FOR THE TRACK RECORD PERIODS
Up to the date of issue of these financial statements, the IASB has issued a number of new or amended
standards, which are not yet effective for the year ended 31 December 2023 and which have not been adopted in these
financial statements. These developments include the following which may be relevant to the Group.
Effective for
accounting periods
beginning on or after
Amendments to IAS 1, Classification of liabilities as current or non-current 1 January 2024
Amendments to IFRS 16, Lease Liability in a Sale and Leaseback 1 January 2024
Amendments to IAS 1, Non-current Liabilities with Covenants 1 January 2024
Amendments to IAS 7 and IFRS 7, Supplier Finance Arrangements 1 January 2024
Amendments to IAS 21, Lack of exchangeability 1 January 2025
Amendments to IFRS 10 and IAS 28, Sale or contribution of assets between
an investor and its associate or joint venture
Available for optional
adoption/effective date
deferred indefinitely
The Group is in the process of making an assessment of what the impact of these amendments, new standards
and interpretations is expected to be in the period of initial application. So far the Group has concluded that the
adoption of them is unlikely to have a significant impact on the Group’s results of operations and financial position.
37 SUBSEQUENT EVENTS
Subsequent to December 31, 2023, there is no significant subsequent event.
Subsequent Financial Statements
No audited financial statements have been prepared by the Company or any of its subsidiaries in respect of any
period subsequent to 31 December 2023.
APPENDIX I ACCOUNTANTS’ REPORT
– I-88 –


--- page 626 ---
The information set forth in this appendix does not form part of the accountants’ report
prepared by KPMG, Certified Public Accountants, Hong Kong, the reporting accountants of
the Company, as set forth in Appendix I to this document, and is included herein for illustrative
purposes only.
The unaudited pro forma financial information should be read in conjunction with the
section headed “Financial Information” in this document and the accountants’ report set forth
in Appendix I to this document.
UNAUDITED PRO FORMA ADJUSTED NET TANGIBLE ASSETS
The following statement of unaudited pro forma adjusted net tangible assets of our Group
is prepared in accordance with Rule 4.29 of the Listing Rules and is set out below for the
purpose to illustrate the effect of the Global Offering on the consolidated net tangible liabilities
attributable to equity shareholders of the Company as of 31 December 2023 as if it had taken
place on 31 December 2023.
The statement of unaudited pro forma adjusted net tangible assets has been prepared for
illustrative purpose only and because of its hypothetical nature, it may not give a true picture
of the financial position of the Group had the Global Offering been completed as of
31 December 2023 or at any future date.
Consolidated
net tangible
liabilities
attributable
to the equity
shareholders of
the Company as
of 31 December
2023 (1)
Estimated net
proceeds from
this Global
offering (2)(5)
Estimated
impact upon the
derecognition
of redeemable
capital
contributions (3)
Unaudited
pro forma
adjusted net
tangible assets
attributable to
the equity
shareholders of
the Company (6)
Unaudited pro forma adjusted net
tangible assets attributable to the
equity shareholders of the
Company per Share (4)
(in thousands of RMB) RMB (4) HK$(5)
Based on an
Offer Price of
HK$152.10
per Share (154,823) 541,848 852,912 1,239,937 35.00 38.38
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-1 –


--- page 627 ---
Notes:
(1) The consolidated net tangible liabilities attributable to the equity shareholders of the Company as of 31
December 2023 is calculated based on the audited Consolidated total deficit attributable to the equity
shareholders of the Company as of 31 December 2023 of RMB11,683,000 extracted from the
Accountants’ Report set out in Appendix I to this Prospectus, after deduction of intangible assets
attributable to the equity shareholders of the Company of RMB103,972,000 and goodwill of
RMB39,168,000.
(2) The estimated net proceeds from this Global Offering are based on the expected issuance of 4,365,660
H shares and the indicative Offer Prices of HK$152.10, after deduction of the estimated underwriting
fees and other estimated related expenses payable by the Group (excluding listing expenses of
RMB20,509,000 which have been expensed prior to 31 December 2023) and does not take into account
of any shares which may be issued upon the exercise of the Over-allotment Option.
(3) The carrying amount of redeemable capital contributions was RMB852,912,000 as of 31 December 2023
(as set out in Note 26 to the Historical Financial Information included in the Accountant’s Report in
Appendix I to this Prospectus). Upon the Listing and completion of the Global Offering, special rights
attributable to the investors of the redeemable capital contributions will be removed, and these
redeemable capital contributions will be derecognized as liabilities and transferred to equity.
(4) The unaudited pro forma adjusted net tangible assets attributable to equity shareholders of the Company
per Share is arrived at after adjustments on the basis that 35,424,890 Shares were in issue assuming that
the Global Offering had been completed on 31 December 2023 without taking into account of the Shares
may be issued upon exercise of the Over- allotment Option.
(5) For illustrative purpose, the estimated net proceeds from the Global Offering is converted from the Hong
Kong Dollar into Renminbi and the unaudited pro forma adjusted net tangible assets attributable to the
equity shareholders of the Company per Share is converted from Renminbi into Hong Kong Dollar at
the exchange rate of HK$1 to RMB0.9120, the exchange rate set by PBOC prevailing on 20 June 2024.
No representation is made that the Hong Kong Dollars amounts have been, could have been or may be
converted to Renminbi, or vice versa, at that rate.
(6) No adjustment has been made to the unaudited pro forma adjusted net tangible assets attributable to
equity shareholder of the Company to reflect any trading results or other transactions entered into
subsequent to 31 December 2023.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-2 –


--- page 628 ---
The following is the text of a report received from the reporting accountants, KPMG,
Certified Public Accountants, Hong Kong, in respect of the Group’ s pro forma financial
information for the purpose in this prospectus.
INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE
COMPILATION OF PRO FORMA FINANCIAL INFORMATION
TO THE DIRECTORS OFʮ̡ SHANGHAI VOICECOMM
INFORMATION TECHNOLOGY CO., LTD.*
We have completed our assurance engagement to report on the compilation of pro forma
financial information of Shanghai V oicecomm Information Technology Co., Ltd. (the
“Company”) and its subsidiaries (collectively the “Group”) 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 net tangible assets as at 31 December
2023 and related notes as set out in Appendix II to the prospectus dated 28 June 2024 (the
“Prospectus”) issued by the Company. The applicable criteria on the basis of which the
Directors have compiled the pro forma financial information are described in Appendix II to
the Prospectus.
The pro forma financial information has been compiled by the Directors to illustrate the
impact of the proposed offering of the ordinary shares of the Company (the “Global Offering”)
on the Group’s financial position as at 31 December 2023 as if the Global Offering had taken
place at 31 December 2023. As part of this process, information about the Group’s financial
position as at 31 December 2023 has been extracted by the Directors from the Group’s
historical financial information included in the Accountants’ Report as set out in Appendix I
to the Prospectus.
Directors’ Responsibilities for the Pro Forma Financial Information
The Directors are responsible for compiling the 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 7 “Preparation of Pro Forma Financial Information for Inclusion in Investment
Circulars” (“AG 7”) issued by the Hong Kong Institute of Certified Public Accountants
(“HKICPA”).
* For identification purpose only.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-3 –


--- page 629 ---
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 behaviour.
The firm applies Hong Kong Standard on Quality Management 1 “Quality Management
for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or
Related Services Engagements”, 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.
Reporting Accountants’ Responsibilities
Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the
Listing Rules, on the 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 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 (“HKSAE”) 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 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 purpose of this engagement, we are not responsible for updating or reissuing any
reports or opinions on any historical financial information used in compiling the 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 pro forma financial information.
The purpose of pro forma financial information included in an investment circular 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 events or transactions as at 31 December 2023 would have
been as presented.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-4 –


--- page 630 ---
A reasonable assurance engagement to report on whether the 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 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 pro forma adjustments give appropriate effect to those criteria; and
 the pro forma financial information reflects the proper application of those
adjustments to the unadjusted financial information.
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 pro forma financial information has been compiled, and other relevant
engagement circumstances.
The engagement also involves evaluating the overall presentation of the pro forma
financial information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Our procedures on the pro forma financial information have not been carried out in
accordance with attestation standards or other standards and practices generally accepted in the
United States of America, auditing standards of the Public Company Accounting Oversight
Board (United States) or any overseas standards and accordingly should not be relied upon as
if they had been carried out in accordance with those standards and practices.
We make no comments regarding the reasonableness of the amount of net proceeds from
the issuance of the Company’s shares, the application of those net proceeds, or whether such
use will actually take place as described in the section headed “Future Plans and Use of
Proceeds” in the Prospectus.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-5 –


--- page 631 ---
Opinion
In our opinion:
(a) the pro forma financial information has been properly compiled 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 pro forma financial
information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.
KPMG
Certified Public Accountants
8th Floor, Prince’s Building
10 Chater Road
Central, Hong Kong
28 June 2024
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-6 –


--- page 632 ---
TAXATION FOR HOLDERS OF SECURITIES
Income tax and capital gains tax of holders of the 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 laws and practices, and has not taken in to account the expected change or
amendment to the relevant laws and policies and does not constitute any opinion or advice. The
discussion does not deal with all possible tax consequences relating to an investment in the H
shares, nor does it take into account the specific circumstances of any particular investor, some
of which may be subject to special regulation. Accordingly, you should consult your own tax
adviser regarding the tax consequences of an investment in the H shares. The discussion is
based upon laws and relevant interpretations in effect as of the Latest Practicable Date, all of
which are subject to change and may have retrospective effect.
No issues on PRC or Hong Kong taxation other than income tax, capital gain tax and
profits tax, business tax/V AT, 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 the 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 Arrangement between the Mainland of China and the Hong Kong Special
Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal
Evasion with respect to Taxes on Income (ᅄ೼
τર) (hereinafter referred to as the “ Arrangement for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income
(τર)”) signed by the Mainland of China and the
Hong Kong Special Administrative Region on August 21, 2006, the PRC government may
impose tax on dividends paid by a PRC company to a Hong Kong resident (including natural
person and legal entity), but such tax shall not exceed 10% of the total amount of dividends
payable. If a Hong Kong resident directly holds 25% or more of equity interest in a PRC
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-1 –


--- page 633 ---
company and the Hong Kong resident is the beneficial owner of the dividends and meets other
conditions, such tax shall not exceed 5% of the total amount of dividends payable by the PRC
company. The Fifth Protocol to the Arrangement between the Mainland of China and the Hong
Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention
of Fiscal Evasion with Respect to Taxes on Income (׵<ಥतйБ
τર>) (the “ Fifth Protocol (ୋ
)”) issued by the SAT and became effective on December 6, 2019 provides that such
provisions shall not apply to arrangements or transactions made for one of the primary
purposes of obtaining such tax benefits.
Enterprise Investors
In accordance with the Enterprise Income Tax Law of the PRC ( ʕശɛ͏΍ձ਷Άุ
) issued by NPC on March 16, 2007 and latest amended on December 29, 2018 and
the Implementation Provisions of the Enterprise Income Tax Law of the PRC ( ʕശɛ͏΍
ૢԷ) issued by the State Council on December 6, 2007, came into
effect on January 1, 2008 and amended on April 23, 2019 (hereinafter collectively referred to
as the “ EIT Law ”), a non-resident enterprise is generally subject to a 10% enterprise income
tax on PRC-sourced income (including dividends received from 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. 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. Such withholding tax may be reduced or exempted pursuant
to an applicable treaty for the avoidance of double taxation.
The Circular of the State Administration of Tax on Issues Relating to the Withholding and
Remitting of Enterprise 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 SAT on November 6, 2008, further clarified that a PRC-resident
enterprise must withhold corporate income tax at a rate of 10% on the dividends paid to
non-PRC resident enterprise holders of H Shares which are derived out of profit generated
since 2008. Non-PRC resident enterprise shareholders who need to enjoy tax treaty benefits,
the relevant provisions of such tax treaty shall apply.
Pursuant to the Arrangement for the Avoidance of Double Taxation and the Prevention of
Fiscal Evasion with respect to Taxes on Income (τ
ર), the PRC government may impose tax on dividends paid by a PRC company to a Hong
Kong resident (including natural person and legal entity), but such tax shall not exceed 10%
of the total amount of dividends payable. If a Hong Kong resident directly holds 25% or more
of equity interest in a PRC company and the Hong Kong resident is the beneficial owner of the
dividends and meets other conditions, such tax shall not exceed 5% of the total amount of
dividends payable by the PRC company. The Fifth Protocol () provides that
such provisions shall not apply to arrangements or transactions made for one of the primary
purposes of obtaining such tax benefits.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-2 –


--- page 634 ---
Although there may be other provisions under the Arrangement for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income ( ࿁
τર), the treaty benefits under the criteria shall not be
granted in the circumstance where relevant gains, after 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 Special Administrative Region,
Macau Special Administrative Region, 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
Pursuant to the Notice on Fully Implementing the Pilot Reform for the Transition from
Business Tax to Value-added Tax () (the
“Circular 36 ”), which was implemented on May 1, 2016 and partially repealed on July 1,
2017, January 1, 2018 and April 1, 2019, entities and individuals engaged in the services sale
in the PRC are subject to V AT 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
transfer of financial products, including transfer of the ownership of marketable securities,
shall be subject to V AT 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 AT taxpayer. However, individuals
who transfer financial products are exempt from V AT, 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 AT
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 the PRC, the holder is not
necessarily required to pay the PRC V AT, but if the H-share buyer is an individual or entity
located in China, the holder may be required to pay the PRC V AT.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-3 –


--- page 635 ---
However, in view of no clear regulations, it is still uncertain whether the non-Chinese
resident enterprises are required to pay the PRC V AT for the disposal of H shares in practice.
At the same time, V AT payers are also required to pay urban maintenance and
construction tax, education surtax and local education surcharge, which shall be usually subject
to 12% of the V AT payable (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 SAT 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 SAT 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 IIT Law.
However, on December 31, 2009, the Ministry of Finance, SAT and CSRC 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 (ɛᔷᜫɪ
), which came into effect on 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 (ɛᔷᜫɪ̹ʮ̡
) 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.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-4 –


--- page 636 ---
Stamp Duty
According to the Stamp Duty Law of the PRC (), which
was promulgated 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.
EIT
According to the EIT Law, enterprises and other income-generating organizations
(hereinafter collectively referred to as “ an enterprise ”o r“ enterprises ”) within the territory
of the PRC are the taxpayers of enterprise income tax and shall pay enterprise income tax in
accordance with the provisions of the EIT Law. The Enterprise Income Tax rate is 25%.
According to the Administrative Measures for Determination of High and New Tech
Enterprises (), which was promulgated by the Ministry of
Science and Technology, the Ministry of Finance and the State Administration of Taxation on
April 14, 2008, amended on January 29, 2016 and became effective on January 1, 2016, an
enterprise recognized as a high and new technology enterprise may apply for a preferential
enterprise income tax rate of 15% pursuant to the relevant requirements of the EIT Law.
VAT
Pursuant to the Interim Regulations on Value-added Tax of the PRC ( ʕശɛ͏΍ձ਷
೼ᅲБૢԷ) issued on December 13, 1993 by the State Council, came into effect on
January 1, 1994, and revised on November 10, 2008, February 6, 2016 and November 19, 2017,
as well as the Implementation Rules for the Interim Regulations on Value-Added Tax of the
PRC () issued on December 25, 1993 by the
MOF, came into effect on the same day and revised on December 15, 2008 and October 28,
2011, any entities and individuals engaged in the sale of goods, supply of processing, repair
and replacement services, and import of goods within the territory of the PRC are taxpayers of
V AT and shall pay the V AT in accordance with the law and regulation. The rate of V AT for sale
of goods is 17% unless otherwise specified, such as the rate of V AT for sale of transportation
is 11%. With the V AT reforms in the PRC, the rate of V AT has been changed several times. The
MOF and the SAT issued the Notice of on Adjusting V AT Rates (೼ਕᐼ҅ᗫ
) on April 4, 2018 to adjust the tax rates of 17% and 11%
applicable to any taxpayer’s V AT taxable sale or import of goods to 16% and 10%, respectively,
this adjustment became effect on May 1, 2018. Subsequently, the MOF, the SAT and the
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-5 –


--- page 637 ---
General Administration of Customs jointly issued the Announcement on Relevant Policies for
Deepening the V AT Reform (ʮ
ѓ) on March 20, 2019 to make a further adjustment, which came into effect on April 1,
2019. The tax rate of 16% applicable to the V AT taxable sale or import of goods shall be
adjusted to 13%, and the tax rate of 10% applicable thereto shall be adjusted to 9%.
TAXATION IN HONG KONG
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
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 Hong
Kong Stock Exchange will be considered to be derived from or arise in Hong Kong. Liability
for Hong Kong profits tax would thus arise in respect of trading gains from sales of H Shares
effected on the Hong Kong 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.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-6 –


--- page 638 ---
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 ADMINISTRATION IN THE PRC
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 People’s Bank of China (the “ PBOC”), is empowered with the functions
of administering all matters relating to foreign exchange, including the enforcement of foreign
exchange control regulations.
The Administrative Regulations on Foreign Exchange 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 5 August 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
individuals making direct investments in the PRC 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.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-7 –


--- page 639 ---
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.
According to the Notice of the State Administration of Foreign Exchange on Issues
Concerning the Foreign Exchange Administration of 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
prospectus and other disclosure documents.
According to the Notice of the State Administration of Foreign Exchange of the PRC on
Revolutionizing and Regulating Capital Account Settlement Management Policies (̮ි
) which was promulgated by the SAFE
and implemented on June 9, 2016, 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.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-8 –


--- page 640 ---
This Appendix contains a summary of laws and regulations on companies and
securities in the PRC, certain major differences between the PRC Company Law and
Companies (Winding Up and Miscellaneous Provisions) Ordinance and the Companies
Ordinance as well as the additional regulatory provisions of the Stock Exchange on joint
stock limited companies of the PRC. The principal objective of this summary is to provide
potential investors with an overview of the principal laws and regulations applicable to
us. This summary is with no intention to include all the information which may be
important to the potential investors. For discussion of laws and regulations specifically
governing the business of the Company, see “Regulatory Overview” in this prospectus.
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 NPC and the SCNPC are
empowered to exercise the legislative power of the State. The NPC has the power to formulate
and amend basic laws governing civil and criminal matters, state organs and other matters. The
SCNPC 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 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, National Audit Office of the
PRC as well as the other organs endowed with administrative functions directly under the State
Council 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.
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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, environmental protection, and historical and cultural protection 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.
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 or separate regulations 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 the SCNPC,
and to annul any autonomous regulations or separate regulations which have been approved by
the SCNPC but which contravene the Constitution or the Legislation Law. The SCNPC 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 SCNPC. According to the Decision of the Standing Committee of the NPC
Regarding the Strengthening of Interpretation of Laws (׵
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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.
PRC JUDICIAL SYSTEM
Under the Constitution and the PRC Law on the Organization of the People’s Courts
(2018 revision) (ج2018ࠈࡌ)), 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 (2023 revision) (ج2023ࡌ
ࠈ)) (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 such choice shall not violate the requirements of the level of jurisdiction and exclusive
jurisdiction.
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.
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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
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.
Pursuant to arrangements for Reciprocal Recognition and Enforcement of Judgments in
Civil and Commercial Cases between Courts of the Mainland and Hong Kong Special
Administrative Region (ʝႩ̙ձੂБ͏ਠ
τર), which came into effect on January 29, 2024, a party with an enforceable
final court judgment rendered by any designated people’s court of China or any designated
Hong Kong court requiring payment of money in a civil and commercial case according to a
written choice of court agreement, may apply for recognition and enforcement of the judgment
in the relevant people’s court of China or Hong Kong court.
THE COMPANY LA W
A joint stock limited company which was incorporated in the PRC and seeking a listing
on the Hong Kong Stock Exchange is mainly subject to the following three laws and
regulations in the PRC:
The Company Law of the PRC () (the “ 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 and December 29, 2023 respectively and the latest revision of which was
implemented on July 1, 2024.
Set out below is a summary of the major provisions of the Company Law applicable to
the Company.
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General
A joint stock limited company refers to an enterprise legal person incorporated in
accordance with 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 laws, the joint stock limited company may not
be a contributor that undertakes joint and several liabilities for the debts of the invested
companies.
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. According to the Interim Provisional
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Regulations on the Administration of Share Issuance and Trading (၍ଣᅲБ
ૢԷ) promulgated by the State Council on April 22, 1993 (which is only applicable to the
issuance and trading of shares in the PRC and their related activities), if a company is
established by means of public subscription, the promoters of such company are required to
sign on the prospectus to ensure that the prospectus does not contain any misrepresentation,
serious misleading statements or material omissions, and assume joint and several
responsibility for it.
Registered Capital
The promoters may make a capital contribution in currencies, or non-monetary assets
such as in kind or intellectual property rights or land use rights which can be appraised with
monetary value and transferred lawfully, except for assets which are prohibited from being
contributed as capital by the laws or administrative regulations. If a capital contribution is
made in non-monetary assets, a valuation of the assets contributed must be carried out pursuant
to the provisions of the laws or administrative regulations on valuation without any
over-valuation or under-valuation.
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.
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.
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.
Shares held by a promoter of a company shall not be transferred within one year after the
date of the company’s incorporation. Shares issued by a company prior to the public offer of
its shares shall not be transferred within one year from the date of listing of the shares of the
company on a stock exchange. Directors, supervisors and senior management of a company
shall not transfer over 25% of the shares held by each of them in the company each year during
their term of office and shall not transfer any share of the company held by each of them within
one year after the listing date. There is no restriction under the Company Law as to the
percentage of shareholding a single shareholder may hold in a company.
Increase of Registered Capital and Issue of Shares
According to the Company Law, in the event a company proposes to issue new shares,
resolutions shall be passed at general meeting in accordance with the articles of association to
determine the class, amount and issue price of the new shares. All issue of shares of a joint
stock limited company shall be based on the principles of equality and fairness. The same class
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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.
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.
According to 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.
Reduction of Registered Capital
A company may reduce its registered capital in accordance with the following procedures
prescribed by the Company Law:
 the company shall prepare a balance sheet and an inventory of the assets;
 the reduction of registered capital shall be approved by a general meeting;
 the company shall inform its creditors of the reduction in registered 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 shall 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 corresponding guarantees covering the debts;
 the company 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
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shareholders who vote against the resolution regarding the merger or division with other
companies at a general meeting; (v) to apply shares for conversion of convertible corporate
bonds issued by a listed company; and (vi) to maintain the company value and protect the
shareholders’ interests of a listed company as necessary.
Repurchase of its own shares on the grounds set out in (i) and (ii) above shall be subject
to resolution passed by the general meeting; repurchase of its own shares on the grounds set
out in (iii), (v) or (vi) above shall be subject to a resolution of the company’s board of directors
shall be made by a two-third majority of directors attending the meeting in accordance with the
provisions of the company’s articles of association or as authorized by the general meeting.
Following the repurchase of its own shares in accordance with (i) above, such shares shall
be canceled within 10 days from the date of repurchase; the shares shall be transferred or
canceled within six months if the repurchase of its own shares is in accordance with either (ii)
or (iv) above; and the shares repurchased in accordance with (iii), (v) or (vi) above shall not
exceed 10% of the company’s total issued shares, and shall be transferred or canceled within
three years.
A listed company shall perform its obligation of information disclosure according to the
provisions of the Securities Law when repurchasing its own shares. In the event the repurchase
of its own shares is in accordance with (iii), (v) or (vi) above, centralized public trading shall
be adopted.
A company shall not accept its own shares as the subject matter of a mortgage.
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.
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 a general meeting or 5 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.
According to 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; and 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
According to the Company Law, the rights of holders of ordinary shares of a joint stock
limited company include:
 the right to attend or appoint a proxy to attend general meetings and to vote thereat;
 the right to transfer shares in accordance with laws, administrative regulations and
provisions of the articles of association;
 the right to inspect the company’s articles of association, share register, counterfoil
of company debentures, minutes of general meetings, resolutions of meetings of the
board of directors, resolutions of meetings of the board of supervisors and financial
and accounting reports and to make proposals or enquiries on the company’s
operations;
 the right to bring an action in the people’s court to rescind resolutions passed by
general meetings and board of directors where the articles of association is violated
by the above resolutions;
 the right to receive dividends and other types of interest distributed in proportion to
the number of shares held;
 in the event of the termination or liquidation of the company, the right to participate
in the distribution of residual properties of the company in proportion to the number
of shares held; and
 other rights granted by laws, administrative regulations, other regulatory documents
and the company’s articles of association.
The obligations of a shareholder include the obligation to abide by the Company’s articles
of association, to pay the subscription moneys in respect of the shares subscribed for and in
accordance with the form of making capital contributions, to be liable for the company’s debts
and liabilities to the extent of the amount of his or her subscribed shares and any other
shareholders’ obligation specified in the company’s articles of association.
Shareholder’s General Meetings
The general meeting is the organ of authority of the company, which exercises its powers
in accordance with the Company Law. According to the Company Law, the general meeting
exercises the following principal powers:
 to decide on the company’s operational policies and investment plans;
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 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.
Annual general meeting is required to be held once every year. Extraordinary 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 registered capital;
 when shareholders individually 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.
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According to the Company Law, 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 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.
According the Company Law, notice of annual 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 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 general meeting.
According to the Company Law, shareholders present at 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 general
meeting, the accumulative voting system may be adopted for the election of directors and
supervisors at the 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 general
meeting and shareholders may consolidate their voting rights when casting a vote.
Pursuant to the Company Law, resolutions of the 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 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 issue of any types of shares, warrants or other similar securities; (iv) the issue of
debentures; (v) the merger, division, dissolution, liquidation or change in the form of the
company; (vi) other matters considered by the 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.
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According to the Company Law, meeting minutes shall be prepared in respect of decisions
on matters discussed at the 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
According to 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.
According to the Company Law, the board of directors mainly exercises the following
powers:
 to convene the general meetings and report on its work to the general meetings;
 to implement the resolutions passed in 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;
 to prepare plans for the merger, division, dissolution and change in the form of the
company;
 to formulate the company’s basic management system; and
 to exercise any other power under the articles of association.
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Board Meetings
According to 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
According to 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.
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;
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--- page 653 ---
 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.
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.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-14 –


--- page 654 ---
The board of supervisors of a company shall hold at least one meeting every six months.
According to the 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 the general
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 general meetings and to convene and
preside over general meetings when the board of directors fails to perform the duty
of convening and presiding over general meeting under this law;
 to initiate proposals for resolutions to 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.
Manager and Senior Management
According to the Company Law, a company shall have a manager who shall be appointed
or removed by the board of directors. The manager shall report to the board of directors and
may exercise the following powers:
 to supervise the business and administration of the company and arrange for the
implementation of resolutions of the board of directors;
 to arrange for the implementation of the company’s annual business plans and
investment proposals;
 to formulate the general administration system of the company;
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
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--- page 655 ---
 to formulate the company’s detailed rules;
 to recommend the appointment and dismissal of deputy managers and person in
charge of finance;
 to appoint or dismiss other administration officers (other than those required to be
appointed or dismissed by the board of directors); and
 to other powers conferred by the board of directors or the articles of association.
The manager shall comply with other provisions of the articles of association concerning
his/her powers. The manager shall attend board meetings.
According to the Company Law, senior management shall mean the manager, deputy
manager(s), person-in-charge of finance, board secretary (in case of a listed company) of a
company and other personnel as stipulated in the articles of association.
Duties of Directors, Supervisors and Senior Management
Directors, supervisors and senior management of the company are required in accordance
with 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 funds;
 depositing the company’s funds 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 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 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 general meeting;
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-16 –


--- page 656 ---
 accept and possess 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.
Finance and Accounting
According to the Company Law, a company shall establish financial and accounting
systems in accordance with 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. A company that makes public stock offerings shall 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 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.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-17 –


--- page 657 ---
Shares held by the company shall not be entitled to any distribution of profit.
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
Pursuant to the Company Law, the appointment or dismissal of accounting firms
responsible for the auditing of the company shall be determined by 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 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.
Distribution of Profits
According to the Company Law, a company shall not distribute profits before losses are
covered and the statutory common reserve fund 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.
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 general meeting
resolve 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
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-18 –


--- page 658 ---
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, a company 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 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 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.
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
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-19 –


--- page 659 ---
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 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 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.
Overseas Listing
The shares of a company shall only be listed overseas after filed with the CSRC, and the
listing must be arranged in accordance with procedures specified by the State Council.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-20 –


--- page 660 ---
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.
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.
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.
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 (), which were repealed on
March 31, 2023. 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.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-21 –


--- page 661 ---
The Securities Law of the People’s Republic of China () (the
“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. The latest
revised Securities Law came into effect on March 1, 2020. This is the first national securities
law in the PRC, which is divided into 14 chapters and 226 articles regulating, among other
things, the issuance 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 Securities Law comprehensively regulates activities in
the PRC securities market. Article 224 of the 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 issuance 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.
On November 14, 2019, CSRC promulgated the Guidance for the Application for the
“Full Circulation” of the Domestic Unlisted Shares of H-share Companies ( Hʮ̡ྤʫ͊
΅͡ሗ“ஷ”ˏ) and was partly revised on August 10, 2023 according to
the Decision on Revising and Abolishing Part of Securities and Futures Policy Documents by
CSRC (). This
guideline is to regulate the listing and circulation (hereinafter referred to as “ Full
Circulation ”) of unlisted domestic shares of domestic joint-stock limited companies
(hereinafter referred to as H-share Companies) listed on the Stock Exchange (including
unlisted domestic shares held by domestic shareholders before overseas listing, unlisted
domestic shares issued in China after overseas listing and unlisted shares held by foreign
shareholders).
Unlisted domestic joint stock limited companies may submit the application for “Full
Circulation” simultaneously when applying for overseas initial public offering and listing.
ARBITRATION AND ENFORCEMENT OF ARBITRAL A W ARDS
The Arbitration Law of the PRC () (the “ Arbitration Law ”)
was passed by the SCNPC on August 31, 1994, became effective on September 1, 1995 and was
amended on August 27, 2009 and September 1, 2017. According to 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.
Where a dispute or claim of rights referred to in the preceding paragraph is referred to
arbitration, the entire claim or dispute must be referred to arbitration, and all persons who have
a cause of action based on the same facts giving rise to the dispute or claim or whose
participation is necessary for the resolution of such dispute or claim, must comply with the
arbitration. Disputes in respect of the definition of shareholder and disputes in relation to the
issuer’s register of shareholders need not be resolved by arbitration.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-22 –


--- page 662 ---
A claimant may elect for arbitration to be carried out at either the China International
Economic and Trade Arbitration Commission (ึ)( “CIETAC”) in
accordance with its rules or the Hong Kong International Arbitration center (“ HKIAC ”) in
accordance with its Securities Arbitration Rules (the “ Securities Arbitration Rules ”). Once a
claimant refers a dispute or claim to arbitration, the other party shall submit to the arbitral body
elected by the claimant. If the claimant elects for arbitration to be carried out at the HKIAC,
any party to the dispute or claim may apply for a hearing to take place in Shenzhen in
accordance with the Securities Arbitration Rules. In accordance with the Arbitration
Regulations of CIETAC () which was amended on
November 4, 2014 and implemented on January 1, 2015, CIETAC shall deal with economic and
trading disputes over contractual or non-contractual transactions, based on an agreement of the
parties, including disputes involving Hong Kong based on the agreement of the parties. The
arbitration commission is established in Beijing and its branches and centers have been set up
in Shenzhen, Shanghai, Tianjin, Chongqing, Zhejiang, Hubei, Fujian, Shanxi, Jiangsu, Sichuan
and Shandong.
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
maybe 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 SCNPC passed
on December 2, 1986. The New York Convention provides that all arbitral awards made in a
state which is a party to the New York Convention shall be recognized and enforced by all other
parties to the New York 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
SCNPC 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 York 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
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-23 –


--- page 663 ---
effective on February 1, 2000. The above arrangement has been amended by the Supplementary
Arrangement on Mutual Enforcement of Arbitral Awards between Mainland China and Hong
Kong (໾̂τર), which adopted by the
Supreme People’s Court and became effective on November 27, 2020. In accordance with this
arrangement, 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.
SUMMARY OF MATERIAL DIFFERENCES BETWEEN HONG KONG AND PRC
COMPANY LA W
The Hong Kong law applicable to a company incorporated in Hong Kong is based on the
Companies (Winding Up and Miscellaneous Provisions) Ordinance and the Companies
Ordinance and is supplemented by common law and the rules of equity that are applicable to
Hong Kong. As a joint stock limited company established in the PRC that is seeking an initial
listing of shares on the Hong Kong Stock Exchange, we are governed by the Company Law and
all other rules and regulations promulgated pursuant to the Company Law.
Set out below is a summary of certain material differences between Hong Kong company
law applicable to a company incorporated in Hong Kong and the Company Law applicable to
a joint stock limited company incorporated and existing under the Company Law. This
summary is, however, not intended to be an exhaustive comparison.
Corporate Existence
Under Hong Kong company law, a company with share capital, is incorporated by the
Registrar of Companies in Hong Kong, which issues a certificate of incorporation to the
company upon its incorporation and the company will acquire an independent corporate
existence. A company may be incorporated as a public company or a private company. Pursuant
to the Companies Ordinance, the articles of association of a private company incorporated in
Hong Kong shall contain certain preemptive provisions. A public company’s articles of
association do not contain such pre-emptive provisions.
Under the Company Law, a joint stock limited company may be incorporated by
promotion or public subscription. The minimum registered capital of a joint stock limited
company is not required, unless otherwise provided by laws, administrative regulations and the
decisions of the State Council, for the paid-up registered capital and the minimum registered
capital of a joint stock limited company.
Hong Kong law does not prescribe any minimum registered capital requirements for a
Hong Kong company.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-24 –


--- page 664 ---
Share Capital
The directors of a Hong Kong company may, with the prior approval of the shareholders
if required, issue new shares of the company. The Company Law does not provide for
authorized share capital, either. Our registered capital is the amount of our issued share capital.
Any increase in our registered capital must be approved by our shareholders’ general meeting
and file with the relevant PRC governmental and regulatory authorities.
Under the Securities Law, an application for listing shall comply with the listing rules of
the stock exchange. Hong Kong law does not prescribe any minimum capital requirements for
companies incorporated in Hong Kong.
Under the Company Law, the shares may be subscribed for in the form of money or
non-monetary assets (other than assets not entitled to be used as capital contributions under
relevant laws and administrative regulations). For non-monetary assets to be used as capital
contributions, appraisals and verification must be carried out to ensure no overvaluation or
undervaluation of the assets. There is no such restriction on a Hong Kong company under Hong
Kong Law.
Restrictions on Shareholding and Transfer of Shares
Under the PRC law, the domestic shares, which are denominated and subscribed for in
Renminbi, can only be subscribed for and traded by PRC investors, designated qualified
overseas institutional investors or qualified overseas strategic investors. Generally, overseas
listed shares, which are denominated in Renminbi and subscribed for in a currency other than
Renminbi, may only be subscribed for, and traded by, investors from Hong Kong, Macau and
Taiwan or any country and territory outside the PRC, or qualified domestic institutional
investors as allowed under Tentative Regulatory Measures for Qualified Domestic Institutional
Investors Investing in Overseas Securities (ྤ̮ᗇՎҳ༟၍ଣ༊Б፬
). If the H Shares are eligible securities under the Southbound Trading Link, they are also
subscribed for and traded by PRC investors in accordance with the rules and limits of
Shanghai-Hong Kong Stock Connect or Shenzhen-Hong Kong Stock Connect.
Under the Company Law, a promoter of a joint stock limited company is not allowed to
transfer the shares it holds for a period of one year after the date of establishment of the
company. Shares in issue prior to our public offering cannot be transferred within one year
from the listing date of the shares on a stock exchange. Shares in a joint stock limited liability
company held by its directors, supervisors and managers transferred each year during their
term of office shall not exceed 25% of the total shares they held in the company, and the shares
they held in the company cannot be transferred within one year from the listing date of the
shares, and also cannot be transferred within half a year after the said personnel has left office.
The articles of association may set other restrictive requirements on the transfer of the
company’s shares held by its directors, supervisors and officers. There are no such restrictions
on shareholdings and transfers of shares under Hong Kong law although there are the
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-25 –


--- page 665 ---
six-month lockup on our Company’s issue of Shares and the 6-month lockup on our Controlling
Shareholders’ disposal of shares, as illustrated by the undertakings given by the Company and
our Controlling Shareholders to the Hong Kong Stock Exchange as described in
“Underwriting” in this prospectus.
Financial Assistance for Acquisition of Shares
The Company Law does not prohibit or restrict a joint stock limited company or its
subsidiaries from providing financial assistance for the purpose of an acquisition of its own or
its holding company’s shares.
Variation of Class Rights
The Company Law has no special provision relating to variation of class rights. However,
the Company Law states that the State Council can promulgate regulations relating to other
kinds of shares.
Under the Companies Ordinance, no rights attached to any class of shares can be varied
except (i) with the approval of a special resolution of the holders of the relevant class at a
separate meeting, (ii) with the consent in writing of the holders representing three fourths of
the nominal value of the issued shares in the class, (iii) with the consent of the Hong Kong
company or (iv) if there are provisions in the articles of association relating to the variation of
those rights, then in accordance with those provisions.
Directors, Senior Management and Supervisors
The Company Law, unlike Hong Kong company law, does not contain any requirements
relating to the declaration of directors’ interests in material contracts, restrictions on directors’
authority in making major dispositions, restrictions on companies providing certain benefits to
directors and guarantees in respects of directors’ liability and prohibitions against
compensation for loss of office without shareholders’ approval.
Board of Supervisors
Under the Company Law, a joint stock limited company’s directors and managers are
subject to the supervision of a supervisors committee. There is no mandatory requirement for
the establishment of a board of supervisors for a company incorporated in Hong Kong.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-26 –


--- page 666 ---
Derivative Action by Minority Shareholders
Under Hong Kong law, a shareholder may, with the leave of the Court, start a derivative
action on behalf of a company for any misconduct committed by its directors against the
company. For example, leave may be granted where the directors control a majority of votes
at a general meeting, and could thereby prevent the company from suing the directors in its own
name.
The Company Law provides shareholders of a joint stock limited company with the right
so that in the event where the directors and senior management violate their fiduciary
obligations to a company, the shareholders individually or jointly holding over 1% of the shares
in the company for more than 180 consecutive days may request in writing the board of
supervisors to initiate proceedings in the people’s court. In the event that the board of
supervisors violates their fiduciary obligations to a company, the above said shareholders may
send written request to the board of directors to initiate proceedings in the people’s court. Upon
receipt of such written request from the shareholders, if the board of supervisors or the board
of directors refuses to initiate such proceedings, or has not initiated proceedings within 30 days
upon receipt of the request, or if under urgent situations, failure of initiating immediate
proceeding may cause irremediable damages to the company, the above said shareholders shall,
for the benefit of the company’s interests, have the right to initiate proceedings directly to the
court in their own name.
Protection of Minorities
Under Hong Kong law, the company may be wound up by the court if the court considers
that it is just and equitable to do so, in addition, a shareholder who complains that the affairs
of a company incorporated in Hong Kong are conducted in a manner unfairly prejudicial to his
interests may petition to the court to make an appropriate order regulating the affairs of the
company. Furthermore, under certain circumstances, the Financial Secretary of Hong Kong
may appoint inspectors who are given extensive statutory powers to investigate the affairs of
a company incorporated in Hong Kong. The PRC law does not contain similar safeguards.
The Company Law provides that any shareholders holding 10% or more of the voting
rights of all issued shares of a company may request a People’s Court to dissolve the company
to the extent that the operation or management of the company experiences any serious
difficulties and the company continues to suffer serious losses and no other alternatives can
resolve.
Notice of Shareholders’ Meetings
Under the Company Law, notice of a shareholder’s annual general meeting must be given
not less than 20 days before the meeting, while notice of an extraordinary general meeting must
be given not less than 15 days before the meeting. If a company has bearer shares, a public
announcement of a general meeting must be made at least 30 days prior to the meeting.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
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--- page 667 ---
For a company incorporated in Hong Kong with limited liability, the minimum period of
notice of a general meeting is 14 days. Further, where a meeting involves consideration of a
resolution requiring special notice, the company must also give its shareholders notice of the
resolution at least 14 days before the meeting. The notice period for the annual shareholders’
general meeting is 21 days.
Quorum for Shareholders’ Meetings
Under Hong Kong law, the quorum for a general meeting must be at least two members
unless the articles of association of the company otherwise provide or the company has only
one member, in which case the quorum is one. For companies with only one member, the
quorum must be one member.
The Company Law does not specify any quorum requirement for a shareholders’ general
meeting.
Voting
Under Hong Kong law, an ordinary resolution is passed by a simple majority of votes cast
by members present in person or by proxy at a general meeting and a special resolution is
passed by a majority of not less than three-fourths of votes cast by members present in person
or by proxy at a general meeting.
Under the Company Law, the passing of any resolution requires affirmative votes of
shareholders representing more than half of the voting rights represented by the shareholders
who attend the general meeting except in cases of proposed amendments to a company’s
articles of association, increase or decrease of registered capital, merger, division or
dissolution, or change of corporation form, which require affirmative votes of shareholders
representing more than two-thirds of the voting rights represented by the shareholders who
attend the general meeting.
Financial Disclosure
Under the Company Law, a joint stock limited company is required to make available at
the company for inspection by shareholders its financial report 20 days before its shareholders’
annual general meeting. In addition, a joint stock limited company of which the shares are
publicly offered must publish its financial report.
The Companies Ordinance requires a company incorporated in Hong Kong to send to
every shareholder a copy of its balance sheet, auditors’ report and directors’ report, which are
to be presented before the company in its annual general meeting, not less than 21 days before
such meeting. A joint stock limited liability company is required under the PRC law to prepare
its financial statements in accordance with the PRC GAAP.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
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--- page 668 ---
Information on Directors and Shareholders
The Company Law gives shareholders the right to inspect the company’s articles of
association, minutes of the shareholders’ general meetings and financial and accounting
reports. Under the Articles of Association, shareholders have the right to inspect and copy (at
reasonable charges) certain information on shareholders and on directors which is similar to the
shareholders’ rights of Hong Kong companies under Hong Kong law.
Receiving Agent
Under the Company Law and Hong Kong law, dividends once declared are debts payable
to shareholders. The limitation period for debt recovery action under Hong Kong law is six
years, while under the PRC law this limitation period is three years according to PRC Civil
Code (Պ), promulgated on May 28, 2020 and became effective on
January 1, 2021.
Corporate Reorganization
Corporate reorganization involving a company incorporated in Hong Kong may be
effected in a number of ways, such as a transfer of the whole or part of the business or property
of the company in the course of voluntary winding up to another company pursuant to Section
237 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance or a compromise
or arrangement between the company and its creditors or between the company and its
members pursuant to Section 673 and Division 2 of Part 13 of the Companies Ordinance, which
requires the sanction of the court. Under PRC law, merger, division, dissolution or change to
the status of a joint stock limited liability company has to be approved by shareholders in
general meeting.
Dispute Arbitration
In Hong Kong, disputes between shareholders on the one hand, and a company
incorporated in Hong Kong or its directors on the other, may be resolved through legal
proceedings in the courts.
Mandatory Deductions
According to the Company Law, a company shall draw 10% of the profits as its statutory
reserve fund before it distributes any profits after taxation. When the aggregate amount of the
company’s statutory reserve fund reaches 50% of the company’s registered capital, the
company may no longer make allocations from the statutory reserve fund. After a company has
made an allocation to its statutory reserve fund from its after-tax profit, it may make an
allocation to its discretionary reserve fund from its after-tax profit upon a resolution approved
at the shareholders’ general meeting. There are no corresponding provisions under Hong Kong
law.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
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--- page 669 ---
Remedies of the Company
Under the Company Law, if a director, supervisor or manager in carrying out his duties
infringes any law, administrative regulation or the articles of association of a company, which
results in damage to the company, that director, supervisor or manager should be responsible
to the company for such damages. In addition, the Listing Rules require listed companies’
articles of association to provide for remedies of the company similar to those available under
Hong Kong law (including rescission of the relevant contract and recovery of profits from a
director, supervisor or senior management).
Dividends
The company has the power in certain circumstances to withhold, and pay to the relevant
tax authorities, any tax payable under PRC law on any dividends or other distributions payable
to a shareholder. Under Hong Kong law, the limitation period for an action to recover a debt
(including the recovery of dividends) is six years, whereas under PRC laws, the relevant
limitation period is three years. The company must not exercise its powers to forfeit any
unclaimed dividend in respect of shares until after the expiry of the applicable limitation
period.
Fiduciary Duties
In Hong Kong, directors owe fiduciary duties to the company, including the duty not to
act in conflict with the company’s interests. Furthermore, the Companies Ordinance has
codified the directors’ statutory duty of care.
Closure of Register of Shareholders
The Companies Ordinance requires that the register of shareholders of a company must
not generally be closed for the registration of transfers of shares for more than 30 days
(extendable to 60 days in certain circumstances) in a year, whereas, as required by the
Company Law, share transfers shall not be registered within 30 days before the date of a
shareholders’ meeting or within five days before the base date set for the purpose of
distribution of dividends.
Any person wishing to have detailed advice on PRC law or the laws of any jurisdiction
is recommended to seek independent legal advice.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
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--- page 670 ---
1. DIRECTORS AND BOARD OF DIRECTORS
(1) Power to allocate and issue shares
The Articles of Association provide that the shareholders may authorize the board of
directors through a general mandate at a general meeting to allocate or issue shares of no more
than 20% of all outstanding H shares. The board of directors shall prepare suggestions for share
allotment or issue, which are subject to approval by the shareholders at the general meeting in
the form of a special resolution. Any such allotment or issue shall be in accordance with the
procedures stipulated in appropriate laws, administrative regulations and supervision rules of
shares listed region.
(2) Power to dispose assets of our Company or any subsidiary
The sale of substantial assets that exceeds 30% of total assets of the latest audited
financial statement are subject to approval by the shareholders at the general meeting in the
form of a special resolution. The boards of directors may decide on the disposal of assets of
the Company as authorized by the shareholders in a general meeting.
(3) Emoluments or compensation for directors and supervisors
The emoluments or compensation for directors and supervisors that are not representative
of employees of the Company are subject to approval by the shareholders at the general
meeting in the form of an ordinary resolution.
(4) Appointment, Resignation and Dismissal
The board of directors consists of ten directors, four of which are independent
non-executive directors. The board of directors has one chairman. Directors are elected at the
general meeting.
The chairman of the Board shall be elected and dismissed by a vote of more than one half
of the directors. Provided that it is in compliance with relevant laws, regulations and rules, the
shareholders’ general meeting may remove any director whose term has not expired by an
ordinary resolution without affecting any claim for damages that may be made pursuant to any
contract.
The chairman of the Board and other directors all serve three-year terms. Upon expiration
of the term, the director may be re-elected. Director can be the general manager or other senior
management personnel at the same time. There is no provision in the Articles of Association
that imposes any age limit for directors beyond which retirement of a director is mandatory.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 671 ---
None of the following persons shall serve as our director, supervisor or senior
management:
i. A person who has no civil capacity or has limited civil capacity;
ii. A person who has been imposed penalty for the offense of corruption, bribery,
embezzlement, larceny, or disrupting the socialist economic order and is within
five years of the expiry date of punishment or has been deprived of political rights
because of this conviction and is within five years of the expiry date of the sentence;
iii. A person who is a former director, factory manager or general manager of a company
or enterprise that is bankrupt and liquidated because of poor operation, was
personally liable for the bankruptcy of such company or enterprise, and is within
three years of the date of completion of bankruptcy and liquidation of such company
or enterprise;
iv. A person who has served as the legal representative of a company or enterprise
whose business license was revoked or was ordered to close due to violation of laws,
was personally liable, and is within three years of the date on which the business
license of such company or enterprise was revoked;
v. A person who has a relatively large sum of debt, which was not paid at maturity;
vi. A person who is prohibited by China Securities Regulation Commission’s from
entering into the securities market and is still in such prohibition period; or
vii. Any other person who is otherwise not eligible under laws, administrative
regulations, regulations of the authorities, regulatory documents and other
conditions set out by the relevant regulatory bodies.
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.
(5) Borrowing powers
The Articles of Association do not contain any specific provisions regarding directors’
exercise of lending powers. The board of directors shall be entitled to develop proposals for
our Company to issue bonds and to list its Shares, and that such bond issues must be approved
by the shareholders by a special resolution at the general meeting.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 672 ---
(6) Duties
Directors shall comply with laws, administrative regulations, and the Articles of
Association, with the following duties of loyalty to the Company:
i. Directors shall not abuse their authority by receiving any bribe or other illegal
income, and shall not embezzle any of the property of the Company;
ii. Directors shall not misappropriate the Company’s funds;
iii. Directors shall not deposit company assets into accounts held in their own names or
in the name of any other individual;
iv. Directors shall not, in violation of the Articles of Association, lend Company funds
to other people or provide guarantee for other people with Company assets without
the consent of the shareholders’ general meeting or the board of directors;
v. Directors shall not enter into contracts or trade with the Company either in violation
of the Articles of Association or without the consent of the shareholders’ general
meeting;
vi. Without the consent of the shareholders’ general meeting, any director shall not take
advantage of his/her position to seek business opportunities that should belong to the
Company for himself/herself or for any other person, or operate business of the same
kind for himself/herself or for any other person;
vii. Directors shall not accept commissions for transactions with the Company as their
own;
viii. Directors shall not disclose Company secrets without authorization;
ix. Directors shall not make use of their related-party relationship to damage the
Company’s interests; and
x. Directors shall have other duties of loyalty specified by laws, administrative
regulations, departmental rules, Listing Rules and the Articles of Association.
Any income obtained by a director in violation of this article shall belong to the
Company; if losses are caused to the Company, the director shall be liable for compensation.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 673 ---
Directors shall comply with laws, administrative regulations, and the Articles of
Association, with the following duties of diligence to the Company:
i. Directors shall be prudent, scrupulous and diligent in exercising the authority
conferred by the Company to ensure that the business activities of the Company
comply with the laws, administrative regulations and various economic policy
requirements, and that the business activities do not go beyond the scope of business
activities specified in the Company’s business license;
ii. Directors shall treat all shareholders equally;
iii. Directors shall keep abreast of the Company’s business management status;
iv. Directors shall sign written statements confirming periodic reports of the Company,
and ensure that the information disclosed by the Company is true, accurate, and
complete;
v. Directors shall provide accurate information and materials to the board of
supervisors, and shall not interfere with the performance of duties by the board of
supervisors or individual supervisors; and
vi. Directors shall have other diligence duties prescribed by laws, administrative
regulations, departmental rules and the Articles of Association.
2. MODIFICATION OF THE ARTICLE OF ASSOCIATION
Our Company may amend the Articles of Association based on the provisions of the laws,
administrative regulations and Articles of Association.
In the event that the amendments to the Articles of Association passed by the general
meetings need the examination and approval of the competent authorities, these amendments
shall be submitted hereto for approval. Where the amendment of the Articles of Association
involves registration, it shall be necessary to carry out the lawfully prescribed procedures for
registration change.
3. SPECIAL RESOLUTIONS NEEDED TO BE ADOPTED BY ABSOLUTE
MAJORITY VOTE
The resolutions of the general meeting shall be divided into ordinary resolutions and
special resolutions.
An ordinary resolution may be adopted by a simple majority of the votes held by the
shareholders (including proxies of shareholders) attending the general meeting.
A special resolution can be adopted by a two-thirds majority of the votes held by the
shareholders (including proxies of shareholders) attending the general meeting.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 674 ---
4. VOTING RIGHTS
The ordinary shareholders have the right to attend or appoint a proxy to attend and vote
at the general meeting. When voting at the general meeting, the shareholder (including proxy)
may exercise his or her voting rights in accordance with the number of shares with voting
power held with each share representing one vote.
Any shareholder who is required by laws, regulations, regulatory documents and Listing
Rules to abstain from voting on a matter or is limited to an affirmative or negative vote shall
abstain from voting or be required to so vote; any vote cast by or on behalf of relevant
shareholder which is cast in violation of such requirement or restriction shall not be counted
in the voting result.
The shares held by the Company itself shall have no voting right and shall not be counted
in the total number of voting shares at the general meeting.
5. RULES ON GENERAL SHAREHOLDERS’ 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.
6. ACCOUNTING AND AUDITS
(1) Financial and accounting policies
Our Company shall develop its financial accounting policies pursuant to laws,
administrative regulations and rules developed by the competent department.
The interim results or financial information published or disclosed by our Company shall
at the same time be prepared in accordance with the PRC accounting standards, rules and
regulations as well as international accounting standards or the accounting standards of the
overseas area in which the shares are listed.
Our Company shall publish the financial reports twice in each accounting year. Interim
financial reports shall be published within 3 months of the end of the first six months of a fiscal
year, while the annual financial report shall be published within 4 months of the end of each
accounting year.
(2) Appointment and Dismissal of Accountants
Our Company shall appoint a reputable accounting firm that meets appropriate
requirements of the relevant regulations of the PRC to be responsible for providing services
such as the audit of financial statements, the verification of net assets and other relevant
consultancy services. The term of the accounting firm shall be one year.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 675 ---
If the position of an appointed accounting firm is vacant, the board of directors may
appoint an accounting firm before the start of general meeting. However, if during the vacant
period, our Company has other incumbent accounting firm, such accounting firm may take the
vacant.
Except the circumstances as above said, our Company shall appoint an accounting firm
by the decision of the general meeting. The shareholders may replace the accounting firm
through an ordinary resolution at the general meeting.
7. NOTICE AND AGENDA OF GENERAL SHAREHOLDERS’ MEETINGS
The general meeting is the authorized organ of our Company that performs duties and
exercises powers in accordance with the law.
Under any of the following circumstances, our Company shall convene an extraordinary
general meeting within two months:
i. The number of directors is less than the number specified in the PRC Company Law
or less than two thirds of the number required in the Articles of Association;
ii. The uncovered losses of our Company reach one-third of its total paid-in registered
capital;
iii. The shareholders with 10% or more shares of the Company separately or jointly
request to convene an extraordinary general meeting in writing;
iv. The board of directors considers it necessary;
v. The board of supervisors makes such proposal;
vi. Any other circumstances stipulated in laws, administrative regulations, departmental
regulations, the Listing Rules, the Articles of Association.
In the event that the general meeting is convened, the board of directors, the board of
supervisors and shareholders who separately or jointly hold more than 3% of the shares of our
Company may submit a proposal to the company.
Shareholders who separately or jointly hold more than 3% of the shares of our Company
may submit an extraordinary proposal 10 days before the general meeting is convened.
When convening a general meeting, our Company shall send a written notice 20 days
before it is convened. When convening an extraordinary general meeting, our Company shall
send a written notice 15 days before it is convened.
The shareholder’s meeting shall not decide on issues which are not listed in the notice.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-6 –


--- page 676 ---
The notice of the general meeting shall be made in writing, including the following
contents:
i. The place, the date and the hour of the meeting;
ii. The matters and proposals to be discussed at the meeting;
iii. Conspicuous statement that all shareholders are entitled to attend the meeting and
appoint proxy to attend and vote and that proxy need not be a shareholder;
iv. The date of record for the shareholders who are entitled to attend the meeting;
v. The name and telephone number of the contact person for the meeting;
vi. The time and procedure of voting online or by any other means;
vii. Other requirements stipulated by laws, administrative regulations, department rules,
Listing Rules and Articles of Association.
The resolution of the general meeting includes ordinary resolution and special resolution.
The following matters shall be approved by the general meeting through ordinary resolutions:
i. Work report of the board of directors and the board of supervisors;
ii. Plans of earnings distribution and loss make-up schemes drafted by the board of
directors;
iii. Appointment or dismissal of the members of the board of directors and the board of
supervisors, and their enumeration and payment methods;
iv. Annual budget plan and final account plan;
v. Annual reports of the Company;
vi. Other matters other than those approved by special resolution stipulated in the laws,
administrative regulations, Listing Rules or the Articles of Association.
The following matters shall be approved by special resolution at the general meeting:
i. The increase or decrease of the registered capital;
ii. Division, split, merger, dissolution and liquidation of our Company;
iii. Amendment of the Articles of Association;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-7 –


--- page 677 ---
iv. The purchase or sale by the Company within one year of material assets exceeding
30% of the audited total assets of the Company at latest audited financial statement;
v. Share incentive scheme;
vi. Other matters recognized by ordinary resolution of the general meeting that could
materially affect our Company and need to be approved by special resolution or as
required by the laws, administrative regulations, Listing Rules or the Articles of
Association;
In the event that any resolution of the general meeting or resolution of the board of
directors violates laws or administrative regulations, any shareholder is entitled to request the
court to deem it as invalid.
In the event that the convening procedure or voting formula of the shareholders meeting
or meeting of the board of directors violates any of laws, administrative regulations or the
Articles of Association, or resolution of which violates the Articles of Association, any
shareholder is entitled to ask the court to overturn within 60 days after the resolution was
adopted.
8. SHARES TRANSFERS
The shares of our Company holding by the funders thereof shall not be transferred within
one year of the date of establishment of our Company. The shares issued before the public
issuance of shares by our Company shall not be transferred within one year of the date on
which the stocks of our Company are offering and listing on a securities exchange.
The directors, supervisors, and senior management of our Company shall declare, to our
Company, information on their holdings of the shares of our Company and the changes thereto.
The shares transferable by them during each year of their term of office shall not exceed
25 percent of their total holdings of the shares of our Company. The shares that they held in
our Company shall not be transferred within one year of the date on which the stocks of our
Company are offering and listing on a securities exchange. The aforesaid persons shall not
transfer their shares of our Company within six months from the date of their resignation.
With regard to the H Shares that capital of which has been full-paid could be transferred
without limitation in accordance with the Articles of Association. However, unless meeting the
following conditions, the board of directors may refuse to recognize any transfer document
without giving any reason:
i. Document that related to any share ownership or transfer documents that may affect
the ownership of the shares shall be registered and a fee for registration shall be paid
to our Company according to the payment standard specified by the listing rules of
the stock exchange, and such payment shall not exceed the maximum fee provided
by the listing rules of the stock exchange from time to time;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 678 ---
ii. The transfer documents only involve H Shares listed in Hong Kong;
iii. The stamp duty chargeable on the transfer documents specified by Hong Kong Laws
has been paid;
iv. The relevant share certificate, and upon the reasonable request of the board of
directors, any evidence in relation to the right of the transferor to transfer the shares
has been submitted;
v. If the shares are to be transferred to joint holders, the number of the joint holders
shall not exceed four;
vi. Our Company does not have any lien on the relevant shares; and
vii. The shares shall not be transferred to minors or the person who is insane or is found
to be of unsound mind.
9. RIGHTS OF OUR COMPANY TO PURCHASE OUR OUTSTANDING ISSUED
SHARES
Our Company shall not buy back its shares. However, under any of the following
circumstances, our Company may buy back our outstanding issued shares without against any
laws, regulations, Listing Rules and the Articles of Association:
i. Reduce our Company’s registered capital;
ii. Merger with other companies which hold our shares;
iii. Granting shares to the staff of our Company for employee stock ownership plan or
equity incentive plan;
iv. Requesting the Company to buy back its shares from shareholders who vote against
any resolutions adopted at the general meeting concerning the merger and division
of the Company;
v. To convert shares into bond issued by our Company which is convertible to stock of
our Company;
vi. Necessary for our Company to maintain our Company’s value and shareholders’
equity; or
vii. Other circumstances as permitted by the laws, administrative regulations,
regulations of the authorities and Listing Rules.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 679 ---
10. POWER FOR ANY SUBSIDIARY OF OUR COMPANY TO OWN SHARES IN ITS
PARENT
There are no provisions in the Articles of Association relating to ownership by subsidiary
of our Company of shares in its parent.
11. DIVIDEND AND OTHER DISTRIBUTION METHODS
The Company may distribute dividends in the following manner of cash or stock.
12. SHAREHOLDER PROXIES
Shareholders may attend the shareholders’ general meeting in person or authorize proxies
to attend and vote on their behalf (A proxy need not be a shareholder of the Company). A legal
person shareholder should attend the meeting by its legal representatives or persons authorized
proxies to attend and vote on their behalf.
Shareholders shall, according to his or her free will, to instruct the proxy to vote and
provide instructions separately for matters to be put to vote on each item on the meeting
agenda.
13. REVIEW THE REGISTER OF SHAREHOLDERS AND OTHER RIGHTS OF
SHAREHOLDERS
Our Company shall make a register of shareholders in accordance with evidentiary
documents provided by the securities registration authorities.
Pursuant to the understanding and agreement entered into between the competent agency
in charge of securities of the PRC and the overseas securities regulatory authorities, our
Company may keep the original register of the shareholders of the overseas listed foreign
shares overseas and entrust an overseas entity to manage it. The original register of the
shareholders of the overseas listed foreign shares listed in Hong Kong shall be kept in Hong
Kong.
Our Company shall keep a copy of the register of the holders of the overseas listed foreign
shares at our residential address. The overseas entrusted agency shall at all times maintain
consistency between the original and copy of the register of the holders of the overseas listed
foreign shares.
In case of inconsistency between the original and copy of the register of the holders of
the overseas listed foreign shares, the original shall prevail.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 680 ---
When our Company convenes the general meeting, pays dividends, goes into liquidation
or is involved in other actions that require the confirmation of identities, the board of directors
or the convenor of the general meeting shall fix a date as the equity registration date, upon
expiration of which the shareholders whose names registered on the register of shareholders
shall be the shareholders entitled to relevant equity.
14. RESTRICTIONS ON RIGHTS OF CONTROLLING SHAREHOLDER
The controlling shareholder and de facto controller of the Company shall not take
advantage of their associated relationship to damage the Company’s interests. Any loss caused
to the Company as a result of such violation shall be compensated.
The controlling shareholder and de facto controller of the Company are obliged to act in
good faith to the Company and the general public company shareholders. The controlling
shareholder shall exercise their rights as capital contributors in strict accordance with the law
and shall not impair the lawful rights and interests of the Company or of the general public
company shareholders by means of the distribution of profits, reorganization of assets, external
investment, misappropriation of assets, loan, or guaranty, nor shall he make use of his
controlling position to impair the interests of the Company or of the general public company
shareholders.
15. PROCEDURES FOR LIQUIDATION
Under any of the following circumstances, our Company shall be lawfully dissolved:
i. The term of business of our Company has expired or other events of dissolution
occur under the Article of Association;
ii. The general meeting adopts a resolution to dissolve our Company;
iii. Our Company needs to be dissolved for the purpose of merger or division;
iv. The business license is revoked, or our Company is ordered to close or be eliminated
according to applicable law; or
v. Where our Company encounters significant difficulties in business and management,
continuous survival may be significantly detrimental to the interests of the
shareholders, and the difficulties may not be overcome through other means,
shareholders who hold more than 10% of all voting rights of the Company’s
shareholders may request the People’s Court to dissolve the Company.
Where our Company is dissolved due to the provisions set forth in i, ii, iv and v above,
the liquidation team shall be established within 15 days from the date of the event leading to
liquidation to commence dissolution and the personnel of the liquidation team shall consist of
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 681 ---
the persons determined by the directors or the general meeting. In the event the liquidation
team is not established to conduct liquidation during such period, the creditors can request the
people’s court to appoint relevant personnel to establish the liquidation team for liquidation.
Within 10 days of the establishment of the liquidation team, the creditors shall be notified
and an announcement shall be published within 60 days. The creditors shall declare their
claims to the liquidation team within 30 days of the date on which the notice is received or
45 days of the date of announcement if the notice is not received.
Creditors who declare claims shall state relevant issues related to the claims and provide
proofs. The liquidation team shall carry out registration of the claims.
During the period for declaration of claims, the liquidation group shall not make any
repayment to the creditors.
During the liquidation, our Company shall continue to exist, but shall not carry out
business activities irrelevant to the liquidation. The property of our Company shall not be
distributed to any shareholder before full payments have been made out of the property
according to the aforesaid provision.
In the event the liquidation team finds that, after taking stock of our Company’s property
and preparing the balance sheet and list of property, that the assets are insufficient to pay the
debts, it shall immediately apply to the people’s court to declare bankruptcy. After our
Company is declared bankrupt by ruling of the people’s court, the liquidation team shall turn
over matters regarding the liquidation to the people’s court.
Upon closure of liquidation of our Company, the liquidation team shall prepare a
liquidation report, and shall be submitted to our general meeting or the people’s court for
recognition. The liquidation team shall submit the above-mentioned documents to our
Company registration authority and apply for cancelation of our registration and publish an
announcement on our termination.
16. OTHER IMPORTANT PROVISIONS FOR OUR COMPANY OR SHAREHOLDERS
(1) General Provisions
Our Company is a permanently existing joint stock limited company.
According to the Articles of Association, any shareholder may bring a lawsuit against
another shareholder, a director, a supervisor, or the senior management, any shareholder may
bring a lawsuit against the Company, and the Company may bring a lawsuit against any
shareholder, director, supervisor or the senior management.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 682 ---
(2) Share and Transfer
Our Company may increase stock capital by the following means:
i. Issuing shares in a public offering;
ii. Issuing shares via a private placement;
iii. Giving bonus shares to existing shareholders;
iv. Converting reserve funds into shares; and
v. Other means approved by the laws, administrative regulations and relevant
regulatory authorities.
Our Company may decrease our registered capital and shall comply with the procedures
stipulated in Company Law of the PRC, other related regulations and the Articles of
Association.
(3) Shareholders
The rights of our ordinary shareholders are as follows:
i. To receive distribution of dividends and other forms of benefits according to the
number of shares held;
ii. To participate in or appoint a shareholder proxy to participate in and exercise
corresponding speaking and voting rights at the general meeting;
iii. To supervise and manage business and operational activities of our Company,
provide suggestions or submit queries;
iv. To transfer, grant and pledge the Company’s shares held according to the provisions
of the laws, administrative regulations and the Articles of Association;
v. To obtain relevant information according to the provisions of the Articles of
Association, including:
(i) Obtaining a copy of Articles of Association after the cost is paid;
(ii) Right to inspect and copy information as follows after the reasonable fee is
paid:
(1) All parts of the register of shareholders;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-13 –


--- page 683 ---
(2) Personal information of the director, supervisor, or senior management,
including:
(a) Current and former name and alias;
(b) Principle address (domicile);
(c) Nationality;
(d) Full-time and other part-time occupation/position;
(e) Identity documents and ID number;
(3) Share capital status of our Company;
(4) A report of the total book value, the number, the highest buying price and
the lowest buying price for shares repurchased by our Company since
then last financial year, and of all expenses incurred thereon;
(5) Special resolutions of the general meeting;
(6) Latest audited financial statement of the Company and the reports of the
board of directors, the board of supervisors, and auditors;
(7) Copy of latest annual report as filed with market regulation
administration and other authorities;
(8) Receipt of corporate bond, decisions of meeting of board of directors and
decisions of meeting of board of supervisors; and
(9) Minutes of shareholder’s general meeting.
vi. To participate in the distribution of the remaining assets of our Company according
to the proportion of shares held upon our termination or liquidation;
vii. To request the Company to buy back their shares as dissenting shareholders in
decision of merger or division of the Company;
viii. Other rights conferred by laws, administrative regulations, regulations of the
authorities, regulatory rules where our Company’s shares are listed, or the Articles
of Association.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-14 –


--- page 684 ---
(4) The board of directors
The board of directors is responsible to the general meeting and exercises the following
powers:
i. To convene the general meeting and report on work to the general meeting;
ii. Implement the resolutions of the general meeting;
iii. Determine the business and investment plans of our Company;
iv. Devise the annual financial budget and closing account plans of our Company;
v. Devise the earnings distribution and loss offset plans of our Company;
vi. Formulate the plans for increasing or decreasing our Company’s registered capital,
the issuance of corporate bonds;
vii. Formulate plans for major acquisition, share buy-back, corporate merger, separation
and dissolution of our Company;
viii. Determine, within the scope authorized by the general meeting or the Article of
Association, such matters as the Company’s external investments, the purchase and
sale of assets, asset mortgages, external guarantees, entrusted management of
finance, related-party transactions and external donations;
ix. Decide on the setup of our Company’s internal management organization;
x. Appoint or dismiss the general manager, secretary of the board, and other senior
managers of our Company and determine their remuneration, rewards and
punishments; based on the nomination of the general manager, appoint or dismiss
senior management of our Company such as deputy general manager, Chief financial
officer (CFO) and other senior managers and determine their remuneration, rewards
and punishments;
xi. Set the basic management systems of our Company;
xii. Formulate a modification plan for the Articles of Association;
xiii. Manage the information disclosure of the Company;
xiv. Make proposals to the shareholders’ general meeting on the appointment or
replacement of the accounting firm that provides auditing services to the Company;
xv. Hear work report of senior managers and to inspect the manager’s work;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-15 –


--- page 685 ---
xvi. Formulate and implement share incentive plans of the Company; and
xvii. Other powers and duties authorized by the laws, administrative regulations,
regulations of the authorities, listing rules of the place where the shares of our
Company are listed and the Articles of Association.
Meetings of the board of directors shall be attended by more than one-half of the directors
before the board of directors meeting can be convened.
(5) Independent Non-executive director
The board of directors of the Company has four independent non-executive directors. At
least one independent non-executive director shall have applicable professional qualification or
are equipped with applicable accounting or relevant financial management expertise.
(6) Secretary of the Board of Directors
Our Company shall have one secretary of the board of directors.
(7) Board of Supervisors
Our Company shall set up a board of supervisors. The board of supervisors consists of
three supervisors and includes one chairman. The chairman of the board of supervisors shall
be elected and dismissed by more than 2/3 of the votes of the members of the board of
supervisors.
The board of supervisors shall consist of shareholder’s representatives and employee’s
representatives. The supervisors shall account for no less than one-third of the board of
supervisors of our Company.
Resolutions of the board of supervisors shall require approval from two-third of all the
supervisors. The supervisors serve three-year terms. The supervisors may, after the expiration
of the term of office, be re-elected and re-appointed.
The directors and senior management shall not also serve as supervisors.
The board of supervisors is responsible to the general meeting and lawfully exercises the
following powers:
i. Review the periodic reports of the Company prepared by the Board of Directors and
provide a written review opinion;
ii. Examine the financial standing of our Company;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-16 –


--- page 686 ---
iii. Supervise the Company’s duties performing of directors and senior management,
and put forward suggestions for dismissing any directors or senior management who
are in breach of the laws, administrative regulations, the Articles of Association or
resolutions of the general meetings;
iv. Require the directors and senior management to take corrective measures when their
actions are detrimental to the Company’s interests;
v. Propose to convene an extraordinary general meeting and to convene and preside
over the shareholders’ general meeting when the board of directors fails to perform
its duty to convene and preside over a general meeting prescribed in the Company
Law;
vi. Submit proposals to the general meetings;
vii. Bring a lawsuit against any director or senior manager in accordance with the
Company Law;
viii. Conduct investigation if any abnormality in the operation of the Company is found,
and, where necessary, engage an accounting firm, law firm or any other specialized
agency to assist in its work at the expense of the Company;
ix. Other powers and duties stipulated in laws, regulations, regulatory documents,
supervision rules of shares listed region and the Articles of Association.
The supervisors may attend the meetings of the board of directors, query or provide
suggestions on the resolution matters of the Board meeting.
(8) General manager
Our Company has one general manager, appointed or dismissed by the board of directors.
The general manager of our Company is responsible to the board of directors and
exercises the following powers:
i. Be in charge of the producing and operational management of our Company,
organize the enforcement of resolutions of the board of directors and report to the
board of directors on work;
ii. Organize the implementation of the annual operation plans and investment schemes
decided by the board of directors;
iii. Formulate the structure scheme of the internal management department of our
Company;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-17 –


--- page 687 ---
iv. Formulate the fundamental management policies of our Company;
v. Formulate the specific management rules of our Company;
vi. Propose the appointment or dismissal of the Company’s deputy general manager,
Chief financial officer and other senior management;
vii. Appoint or dismiss other management personnel except those who shall be
appointed or dismissed by the board of directors;
viii. Other responsibilities authorized by the Articles of Association and the board of
directors.
(9) Reserves
When the annual after-tax earnings of our Company are distributed, our Company must
allocate 10% of the earnings to the statutory reserve of the Company. When the total amount
of the statutory reserve exceeds 50% of our Company’s registered capital, no more allocations
need to be drawn.
If the Company’s statutory reserve is insufficient to offset our losses during the previous
year, the earnings generated during the current year must be used to make up the losses before
allocating the statutory reserve in accordance with the requirements set forth above.
After allocation to the statutory reserve from the after-tax earnings of our Company, we
may also allocate to the reserves at will from after-tax earnings in line with the resolution(s)
adopted at the general meeting.
After our Company has made up for its losses and made allocations to its statutory reserve
fund, the remaining profits are distributed in proportion to the number of shares held by the
shareholders, unless otherwise specified by the Articles of Association.
If the general meeting or directors violates the above provisions and profits are
distributed to the shareholders before the Company makes up for losses or makes allocations
to the statutory reserve fund, the profits distributed in violation of the provisions must be
returned by such shareholders to the Company.
The shares held by our Company itself shall not be subject to profit distribution.
The Company’s reserves may be used only for offsetting losses of the Company,
expanding the scale of business and operations or for conversion into capital to increase our
capital, but the capital reserve shall not be used to offset losses of the Company. Where the
statutory reserve converses into capital, the remaining statutory reserve shall not be less than
25% of the registered capital of our Company before such conversion.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-18 –


--- page 688 ---
A. FURTHER INFORMATION ABOUT OUR GROUP
1. Incorporation of Our Company
Our Company was established in the PRC on December 5, 2005 with an initial registered
capital of RMB1,000,000. On May 7, 2015, our Company was converted into a joint stock
company with limited liability under the PRC Company Law. Accordingly, our corporate
structure and Articles of Association are subject to the relevant laws and regulations of the
PRC. The relevant PRC laws and regulatory provisions and a summary of our Articles of
Association are set out in Appendices IV and V to this prospectus, respectively.
Our principal place of business in Hong Kong is at 40th Floor, Dah Sing Financial Centre,
No. 248 Queen’s Road East, Wanchai, Hong Kong, China. We were registered as a non-Hong
Kong Company under Part 16 of the Companies Ordinance on July 6, 2023. Mr. Cheung Kai
Cheong Willie has been appointed as our authorized representatives for the acceptance of
service of process and notices in Hong Kong.
2. Changes in the Share Capital of Our Company
As at the date of our incorporation, our registered capital was RMB1,000,000, which was
fully paid up upon establishment. On May 7, 2015, our Company was converted into a joint
stock company with limited liability, and our registered capital was RMB10,000,000 divided
into 10,000,000 shares with a nominal value of RMB1.00 each. As at the Latest Practicable
Date, our registered capital was RMB31,059,230 divided into 31,059,230 shares with a
nominal value of RMB1.00 each.
Assuming the Over-allotment Option is not exercised, upon completion of the Global
Offering and the Conversion of Unlisted Shares into H Shares, our issued share capital will
increase to RMB35,424,890, made up of 22,433,317 Unlisted Shares and 12,991,573 H Shares
fully paid up or credited as fully paid up, representing approximately 63.33% and 36.67% of
our registered share capital, respectively.
Save as disclosed in the section headed “History, Development and Corporate Structure”
in this prospectus, there has been no alteration in our share capital within two years
immediately preceding the date of this prospectus.
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 14 to the Accountants’ Report as set out in Appendix I.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-1 –


--- page 689 ---
The following subsidiaries have been established within two years immediately preceding
the date of this prospectus:
Name of subsidiary
Place of
establishment
Date of
establishment
Jinxun Digital Intelligence (Note) PRC July 7, 2022
V oicecomm Jiachen PRC August 30, 2022
Hainan V oicecomm Intelligent Technology PRC December 5, 2022
V oicecomm Gengyou PRC May 10, 2023
V oicecomm Xuanwu PRC May 11, 2023
Chongqing V oicecomm PRC June 8, 2023
Sichuan V oicecomm Zhigan PRC June 28, 2023
V oicecomm Yunxiu PRC June 28, 2023
Sichuan V oicecomm Zhishi PRC July 31, 2023
Guang’an V oicecomm PRC August 23, 2023
Sichuan V oicecomm Yunji PRC April 19, 2024
V oicecomm (Hong Kong) Hong Kong May 24, 2024
Notes:
(1) We acquired 51% of equity interests in Jinxun Digital Intelligence from Jinxuntong Software
Technology in December 2022.
(2) Chengdu V oicecomm Zhigan Technology Co., Ltd. (ʮ̡) was an wholly-owned
subsidiary of our Company established in the PRC on July 25, 2023 with a registered capital of
RMB30,000,000. It was voluntarily deregistered on September 20, 2023.
(3) Jiangsu Shengtong Information Technology Co. Ltd (ப΂ʮ̡) was an wholly-
owned subsidiary of our Company established in the PRC on January 18, 2023 with a registered capital
of RMB10,000,000. It was voluntarily deregistered on October 26, 2023.
The following sets out the changes in the share capital of our subsidiaries during the two
years immediately preceding the date of this prospectus:
Jinxun Digital Intelligence
On January 3, 2023, the registered capital of Jinxun Digital Intelligence was increased
from RMB5.0 million to RMB5.5 million by way of capital injection by our Company.
Save as disclosed above and in the section headed “History, Development and Corporate
Structure” in this prospectus, there has been no alteration in the share capital of our
subsidiaries within two years immediately preceding the date of this prospectus.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-2 –


--- page 690 ---
4. Resolutions of the Shareholders of the Company
Pursuant to the resolutions passed at a duly convened general meeting of our Shareholders
on June 16, 2023, it was resolved, among others:
(a) our H Shares to be listed on the Stock Exchange be issued;
(b) subject to the completion of the Global Offering, the Articles of Association have
been approved and adopted, which shall become effective on the Listing Date, and
the Board has been authorized to amend the Articles of Association in accordance
with any comments from the Stock Exchange and the relevant PRC regulatory
authorities; and
(c) authorizing our Board and its authorized person to handle all relevant matters
relating to, among other things, the implementation of issuance of H Shares and the
Listing.
5. Restrictions on Repurchase
For details, see Appendix IV in this prospectus.
B. FURTHER INFORMATION ABOUT THE BUSINESS OF THE COMPANY
1. Summary of Material Contracts
The following contracts (not being contracts entered into in the ordinary course of
business) were entered into by our Group within the two years preceding the date of this
prospectus and are or may be material:
(a) the capital increase agreement ( ᄣ༟՘ᙄ) dated August 16, 2022 entered into
amongst Shanghai Donghao Lansheng Human Resources Industry Equity
Investment Fund Partnership (Limited Partnership) (ٰ
ΥྫΆุ(Υྫ)), Shanghai V oicecomm Rongzhi Technology Group
Co., Ltd. (ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Shi
Yerong ( ุͩᏌ), Shanghai Chenqi Information Consultation Co., Ltd. (ڦ
ʮ̡), Mr. Sun Qi (೘), Shanghai Jiageng Culture Communication
Co., Ltd. (ʮ̡), and the Company, pursuant to which,
among other things, Shanghai Donghao Lansheng Human Resources Industry Equity
Investment Fund Partnership (Limited Partnership) (ٰ
ΥྫΆุ(Υྫ)) agreed to subscribe for 500,000 new shares of the
Company at the consideration of RMB20,000,000;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-3 –


--- page 691 ---
(b) the supplemental agreement to the capital increase agreement ( ᄣ༟՘ᙄ໾̂՘ᙄ)
dated August 16, 2022 entered into amongst the Company, Shanghai V oicecomm
Rongzhi Technology Group Co., Ltd. (ʮ̡), Mr. Tang
Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai Chenqi Information
Consultation Co., Ltd. (ʮ̡), Mr. Sun Qi (೘), Shanghai
Jiageng Culture Communication Co., Ltd. (ʮ̡) and
Shanghai Donghao Lansheng Human Resources Industry Equity Investment Fund
Partnership (Limited Partnership) (ΥྫΆ
ุ(Υྫ)), in relation to, among other things, the grant of certain special rights
to Shanghai Donghao Lansheng Human Resources Industry Equity Investment Fund
Partnership (Limited Partnership) (ΥྫΆ
ุ(Υྫ));
(c) the capital increase agreement ( ᄣ༟՘ᙄ) dated August 30, 2022 entered into
amongst Suzhou Bodao Dinghua Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ)), Shanghai V oicecomm
Rongzhi Technology Group Co., Ltd. (ʮ̡), Mr. Tang
Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai Chenqi Information
Consultation Co., Ltd. (ʮ̡), Mr. Sun Qi (೘), Shanghai
Jiageng Culture Communication Co., Ltd. (ʮ̡), and the
Company, pursuant to which, among other things, Suzhou Bodao Dinghua Equity
Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ(Ϟ
Υྫ)) agreed to subscribe for 750,000 new shares of the Company at the
consideration of RMB30,000,000;
(d) the supplemental agreement to the capital increase agreement ( ᄣ༟՘ᙄ໾̂՘ᙄ)
dated August 30, 2022 entered into amongst the Company, Shanghai V oicecomm
Rongzhi Technology Group Co., Ltd. (ʮ̡), Mr. Tang
Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai Chenqi Information
Consultation Co., Ltd. (ʮ̡), Mr. Sun Qi (೘), Shanghai
Jiageng Culture Communication Co., Ltd. (ʮ̡) and Suzhou
Bodao Dinghua Equity Investment Partnership (Limited Partnership) ( ᘽψ☞༸ཻശ
ᛆҳ༟ΥྫΆุ(Υྫ)), in relation to, among other things, the grant of
certain special rights to Suzhou Bodao Dinghua Equity Investment Partnership
(Limited Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ));
(e) the capital increase agreement (՘ᙄ) dated August 15, 2022 entered into
between Gongqingcheng Huanping Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ)) and the Company, pursuant
to which, among other things, Gongqingcheng Huanping Equity Investment
Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ))
agreed to subscribe for 745,000 new shares of the Company at the consideration of
RMB29,800,000;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-4 –


--- page 692 ---
(f) the supplemental agreement to the capital increase agreement (՘ᙄʘ໾̂
՘ᙄ) dated August 15, 2022 entered into amongst Gongqingcheng Huanping Equity
Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ(ࠢ
Υྫ)), Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Mr. Sun Qi (೘),
Shanghai V oicecomm Rongzhi Technology Group Co., Ltd. ( ɪऎᑊஷፄ౽Ҧஔණྠ
ʮ̡), Shanghai Chenqi Information Consultation Co., Ltd. (ፔ༔
ʮ̡), Shanghai Jiageng Culture Communication Co., Ltd. (˖ʷෂᅧ
ʮ̡), and the Company, in relation to, among other things, the grant of certain
special rights to Gongqingcheng Huanping Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ));
(g) the investment (capital increase) agreement ( ҳ༟(ᄣ༟)՘ᙄ) dated November 28,
2022 entered into amongst Xi’an Jinxuntong Software Technology Co., Ltd. ( Гτ
ʮ̡), Shanghai V oicecomm Rongzhi Technology Group Co.,
Ltd. (ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong
(ุͩᏌ), Shanghai Chenqi Information Consultation Co., Ltd. (ፔ༔
ʮ̡), Mr. Sun Qi (೘), Shanghai Jiageng Culture Communication Co., Ltd.
(ʮ̡), and the Company, pursuant to which, among other
things, Xi’an Jinxuntong Software Technology Co., Ltd. (ࠢ
ʮ̡) agreed to subscribe for 277,692 new shares of the Company at the
consideration of RMB18,050,000;
(h) the capital increase agreement ( ᄣ༟՘ᙄ) dated May 25, 2023 entered into amongst
Jiaxing Chengshun Phase II Equity Investment Partnership (Limited Partnership)
(ᛆҳ༟ΥྫΆุ(Υྫ)), Shanghai V oicecomm Rongzhi
Technology Group Co., Ltd. (ʮ̡), Mr. Tang Jinghua
(ಷหശ), Mr. Sun Qi (೘), Shanghai Jiageng Culture Communication Co., Ltd.
(ʮ̡) and the Company, pursuant to which, among other
things, Jiaxing Chengshun Phase II Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ)) agreed to subscribe for
1,538,462 new shares of the Company at the consideration of RMB100,000,000;
(i) the supplemental agreement to the capital increase agreement ( ᄣ༟՘ᙄ໾̂՘ᙄ)
dated May 25, 2023 entered into amongst the Company, Shanghai V oicecomm
Rongzhi Technology Group Co., Ltd. (ʮ̡), Mr. Tang
Jinghua ( ಷหശ), Mr. Sun Qi (೘), Shanghai Jiageng Culture Communication Co.,
Ltd. (ʮ̡
) and Jiaxing Chengshun Phase II Equity
Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ(Ϟ
Υྫ)), in relation to, among other things, the grant of certain special rights to
Jiaxing Chengshun Phase II Equity Investment Partnership (Limited Partnership)
(ᛆҳ༟ΥྫΆุ(Υྫ));
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-5 –


--- page 693 ---
(j) the investment (capital increase) agreement ( ҳ༟(ᄣ༟)՘ᙄ) dated May 31, 2023
entered into amongst Zhejiang Jiuli Investment Management Co., Ltd. ( एϪɮͭҳ
ʮ̡), Shanghai V oicecomm Rongzhi Technology Group Co., Ltd. ( ɪऎ
ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Sun Qi (೘),
Shanghai Jiageng Culture Communication Co., Ltd. (ʮ̡)
and the Company, pursuant to which, among other things, Zhejiang Jiuli Investment
Management Co., Ltd. (ʮ̡) agreed to subscribe for
461,538 new shares of the Company at the consideration of RMB29,999,970;
(k) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated May 31, 2023 entered into amongst the Company,
Shanghai V oicecomm Rongzhi Technology Group Co., Ltd. ( ɪऎᑊஷፄ౽Ҧஔණྠ
ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Sun Qi (೘), Shanghai Jiageng Culture
Communication Co., Ltd. (ʮ̡) and Zhejiang Jiuli
Investment Management Co., Ltd. (ʮ̡), in relation to,
among other things, the grant of certain special rights to Zhejiang Jiuli Investment
Management Co., Ltd. (ʮ̡);
(l) the investment (capital increase) agreement ( ҳ༟(ᄣ༟)՘ᙄ) dated June 15, 2023
entered into amongst Neijiang High-tech Investment Service Co., Ltd. (߅
ப΂ʮ̡), Shanghai V oicecomm Rongzhi Technology Group Co.,
Ltd. (ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Sun Qi (࢑
೘), Shanghai Jiageng Culture Communication Co., Ltd. (ʮ
̡) and the Company, pursuant to which, among other things, Neijiang High-tech
Investment Service Co., Ltd. (ப΂ʮ̡) agreed to
subscribe for 461,538 new shares of the Company at the consideration of
RMB29,999,970;
(m) the supplemental agreement to the capital increase agreement ( ᄣ༟՘ᙄ໾̂՘ᙄ)
dated June 15, 2023 entered into amongst the Company, Shanghai V oicecomm
Rongzhi Technology Group Co., Ltd. (ʮ̡), Mr. Tang
Jinghua ( ಷหശ), Mr. Sun Qi (೘), Shanghai Jiageng Culture Communication Co.,
Ltd. (ʮ̡) and Neijiang High-tech Investment Service Co.,
Ltd. (ப΂ʮ̡), in relation to, among other things, the
grant of certain special rights to Neijiang High-tech Investment Service Co., Ltd. ( ʫ
ப΂ʮ̡);
(n) the capital increase agreement ( ᄣ༟՘ᙄ) dated June 15, 2023 entered into amongst
Mr. Zhang Weihua (
ੵਃശ), Shanghai V oicecomm Rongzhi Technology Group Co.,
Ltd. (ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Sun Qi (࢑
೘), Shanghai Jiageng Culture Communication Co., Ltd. (ʮ
̡), and the Company, pursuant to which, among other things, Mr. Zhang Weihua
agreed to subscribe for 20,000 new shares of the Company at the consideration of
RMB1,300,000;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-6 –


--- page 694 ---
(o) the capital increase agreement ( ᄣ༟՘ᙄ) dated June 15, 2023 entered into amongst
Mr. Chen Xuanjun (ё), Shanghai V oicecomm Rongzhi Technology Group Co.,
Ltd. (ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Sun Qi (࢑
೘), Shanghai Jiageng Culture Communication Co., Ltd. (ʮ
̡) and the Company, pursuant to which, among other things, Mr. Chen Xuanjun
agreed to subscribe for 10,000 new shares of the Company at the consideration of
RMB650,000;
(p) the supplemental agreement to the investment agreement ( ҳ༟՘ᙄʘ໾̂՘ᙄ)
dated May 5, 2023 entered into amongst Gongqingcheng Softbank Huaxin
Investment Center (Limited Partnership) (ழვശ㒥ҳ༟ʕː(Υྫ)),
Shanghai Haocen Network Technology Center (Limited Partnership). ( ɪऎ㒊Ҋၣ
Ҧʕː(Υྫ)), Mr. Tang Jinghua ( ಷหശ) and the Company, pursuant to
which, among other things, the parties agreed to terminate certain special rights
granted to Gongqingcheng Softbank Huaxin Investment Center (Limited
Partnership) (ழვശ㒥ҳ༟ʕː(Υྫ));
(q) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated June 22, 2023 entered into amongst Jiaxing Shangyu
Investment Partnership (Limited Partnership) (༃ҳ༟ΥྫΆุ(Υྫ)),
Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Mr. Sun Qi (೘), Mr. Qin
Huai’er ( ൕᕿɚ), Shanghai Xiding Equity Investment Fund Management Co., Ltd.
(ʮ̡), Gongqingcheng Softbank Huaxin
Investment Center (Limited Partnership) (ழვശ㒥ҳ༟ʕː(Υྫ)) and
the Company, pursuant to which, among other things, the parties agreed to terminate
certain special rights granted to Jiaxing Shangyu Investment Partnership (Limited
Partnership) (༃ҳ༟ΥྫΆุ(Υྫ));
(r) the supplemental agreement to the capital increase agreement ( ᄣ༟՘ᙄʘ໾̂՘
ᙄ) dated June 22, 2023 entered into amongst Zibo Yingke Jiyun Venture Capital
Partnership (Limited Partnership) (Λ༶௴ุҳ༟ΥྫΆุ(Υྫ)),
Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Mr. Sun Qi (೘), Mr. Qin
Huai’er ( ൕᕿɚ), Shanghai Xiding Equity Investment Fund Management Co., Ltd.
(ʮ̡), Mr. Bian Yulong ( ʼ͗Ꮂ), Mr. Ding Yi ( ɕ
ᆇ
), Gongqingcheng Softbank Huaxin Investment Center (Limited Partnership) ( ΍
ழვശ㒥ҳ༟ʕː(Υྫ)), Jiaxing Shangyu Investment Partnership
(Limited Partnership) (༃ҳ༟ΥྫΆุ(Υྫ)) and the Company,
pursuant to which, among other things, the parties agreed to terminate certain
special rights granted to Zibo Yingke Jiyun Venture Capital Partnership (Limited
Partnership) (Λ༶௴ุҳ༟ΥྫΆุ(Υྫ));
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-7 –


--- page 695 ---
(s) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated June 21, 2023 entered into amongst Shanghai Xinzhuang
Industrial Park Economic and Technology Development Co., Ltd. ( ɪऎ̹୸୿ʈุ
ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ),
Mr. Sun Qi (೘), Shanghai Xiding Equity Investment Fund Management Co., Ltd.
(ʮ̡), Mr. Bian Yulong ( ʼ͗Ꮂ), Mr. Ding Yi ( ɕ
ᆇ), Mr. Qin Huai’er ( ൕᕿɚ), Gongqingcheng Softbank Huaxin Investment Center
(Limited Partnership) (ழვശ㒥ҳ༟ʕː(Υྫ)), Jiaxing Shangyu
Investment Partnership (Limited Partnership) (༃ҳ༟ΥྫΆุ(Υྫ)),
Zibo Yingke Jiyun Venture Capital Partnership (Limited Partnership) (Λ༶
௴ุҳ༟ΥྫΆุ(Υྫ)) and the Company, pursuant to which, among other
things, the parties agreed to terminate certain special rights granted to Shanghai
Xinzhuang Industrial Park Economic and Technology Development Co., Ltd. ( ɪऎ
ʮ̡);
(t) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated June 12, 2023 entered into amongst Zibo Bokai Venture
Capital Co., Ltd. (ʮ̡), Shanghai V oicecomm Rongzhi
Technology Group Co., Ltd. (ʮ̡), Mr. Tang Jinghua
(ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai Chenqi Information Consultation Co.,
Ltd. (ʮ̡), Mr. Sun Qi (೘), Shanghai Jiageng Culture
Communication Co., Ltd. (ʮ̡) and the Company, pursuant
to which, among other things, the parties agreed to terminate certain special rights
granted to Zibo Bokai Venture Capital Co., Ltd. (ʮ̡);
(u) the supplemental agreement (II) to the cooperation agreement ( ΥЪ՘ᙄʘ໾̂՘ᙄ
(ɚ)) dated June 12, 2023 entered into amongst Boshan Economic Development
Zone Management Committee of Shandong Province (௹ʆ຾᏶ක೯ਜ၍ଣ
ึ), Shanghai V oicecomm Rongzhi Technology Group Co., Ltd. ( ɪऎᑊஷፄ౽
ʮ̡), Mr. Tang Jinghua ( ಷหശ), Shanghai Chenqi Information
Consultation Co., Ltd. (ʮ̡), Mr. Sun Qi (೘), Shanghai
Jiageng Culture Communication Co., Ltd. (ʮ̡) and the
Company, pursuant to which, among other things, the parties agreed to terminate
certain special rights granted to Boshan Economic Development Zone Management
Committee of Shandong Province (ึ);
(v) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated June 13, 2023 entered into amongst Shanghai Cuiwen
Network Technology Co., Ltd. (ʮ̡), Shanghai V oicecomm
Rongzhi Technology Group Co., Ltd. (ʮ̡), Mr. Tang
Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai Chenqi Information
Consultation Co., Ltd. (ʮ̡), Mr. Sun Qi (೘), Shanghai
Jiageng Culture Communication Co., Ltd. (ʮ̡) and the
Company, pursuant to which, among other things, the parties agreed to terminate
certain special rights granted to Shanghai Cuiwen Network Technology Co., Ltd. ( ɪ
ʮ̡);
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-8 –


--- page 696 ---
(w) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated May 30, 2023 entered into amongst Jiaxing Laida
Investment Partnership (Limited Partnership) ( ྗጳഺ༺ҳ༟ΥྫΆุ(Υྫ)),
Shanghai V oicecomm Rongzhi Technology Group Co., Ltd. ( ɪऎᑊஷፄ౽Ҧஔණྠ
ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai Chenqi
Information Consultation Co., Ltd. (ʮ̡), Mr. Sun Qi (࢑
೘), Shanghai Jiageng Culture Communication Co., Ltd. (ʮ
̡), and the Company, pursuant to which, among other things, the parties agreed to
terminate certain special rights granted to Jiaxing Laida Investment Partnership
(Limited Partnership) ( ྗጳഺ༺ҳ༟ΥྫΆุ(Υྫ));
(x) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated June 21, 2023 entered into amongst Qingdao Yingke
Value Venture Capital Partnership (L.P.) (௴ุҳ༟ΥྫΆุ (Υ
ྫ)), Shanghai V oicecomm Rongzhi Technology Group Co., Ltd. ( ɪऎᑊஷፄ౽Ҧ
ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai
Chenqi Information Consultation Co., Ltd. (ʮ̡), Mr. Sun
Qi (೘), Shanghai Jiageng Culture Communication Co., Ltd. (˖ʷෂᅧ
ʮ̡), and the Company, pursuant to which, among other things, the parties
agreed to terminate certain special rights granted to Qingdao Yingke Value Venture
Capital Partnership (L.P.) (௴ุҳ༟ΥྫΆุ (Υྫ));
(y) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated June 19, 2023 entered into amongst Qingdao Huazi
Shengtong Equity Investment Fund Partnership (Limited Partnership) (ശ༟ସ
ΥྫΆุ(Υྫ)), Shanghai V oicecomm Rongzhi Technology
Group Co., Ltd. (ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr.
Shi Yerong ( ุͩᏌ), Shanghai Chenqi Information Consultation Co., Ltd. ( ɪऎો
ʮ̡), Mr. Sun Qi (೘), Shanghai Jiageng Culture
Communication Co., Ltd. (ʮ̡), and the Company, pursuant
to which, among other things, the parties agreed to terminate certain special rights
granted to Qingdao Huazi Shengtong Equity Investment Fund Partnership (Limited
Partnership) (ΥྫΆุ(Υྫ));
(z) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated May 19, 2023 entered into amongst Beijing Jingjin
Investment Management Consulting Co., Ltd. (ʮ̡),
Shanghai V oicecomm Rongzhi Technology Group Co., Ltd. ( ɪऎᑊஷፄ౽Ҧஔණྠ
ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai Chenqi
Information Consultation Co., Ltd. (ʮ̡), Mr. Sun Qi (࢑
೘), Shanghai Jiageng Culture Communication Co., Ltd. (ʮ
̡) and the Company, pursuant to which, among other things, the parties agreed to
terminate certain special rights granted to Beijing Jingjin Investment Management
Consulting Co., Ltd. (ʮ̡);
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-9 –


--- page 697 ---
(aa) the supplemental agreement (II) to the capital increase agreement (՘ᙄʘ
໾̂՘ᙄ(ɚ)) dated May 5, 2023 entered into amongst Gongqingcheng Huanping
Equity Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ
(Υྫ)), Shanghai V oicecomm Rongzhi Technology Group Co., Ltd. ( ɪऎᑊஷ
ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ),
Shanghai Chenqi Information Consultation Co., Ltd. (ʮ̡),
Mr. Sun Qi (೘), Shanghai Jiageng Culture Communication Co., Ltd. (ֲ
ʮ̡), and the Company, pursuant to which, among other things, the
parties agreed to terminate certain special rights granted to Gongqingcheng
Huanping Equity Investment Partnership (Limited Partnership) (ᛆҳ
༟ΥྫΆุ(Υྫ));
(bb) the supplemental agreement to the capital increase agreement ( ᄣ༟՘ᙄʘ໾̂՘
ᙄ) dated May 9, 2023 entered into amongst Shanghai Donghao Lansheng Human
Resources Industry Equity Investment Fund Partnership (Limited Partnership) ( ɪऎ
ΥྫΆุ(Υྫ)), Shanghai V oicecomm
Rongzhi Technology Group Co., Ltd. (ʮ̡), Mr. Tang
Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai Chenqi Information
Consultation Co., Ltd. (ʮ̡), Mr. Sun Qi (೘), Shanghai
Jiageng Culture Communication Co., Ltd. (ʮ̡) and the
Company, pursuant to which, among other things, the parties agreed to terminate
certain special rights granted to Shanghai Donghao Lansheng Human Resources
Industry Equity Investment Fund Partnership (Limited Partnership) (खᚆ͛
ΥྫΆุ(Υྫ));
(cc) the supplemental agreement to the capital increase agreement ( ᄣ༟՘ᙄʘ໾̂՘
ᙄ) dated May 5, 2023 entered into amongst Suzhou Bodao Dinghua Equity
Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ(Ϟ
Υྫ)), Shanghai V oicecomm Rongzhi Technology Group Co., Ltd. ( ɪऎᑊஷፄ
ʮ̡), Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ),
Shanghai Chenqi Information Consultation Co., Ltd. (ʮ̡),
Mr. Sun Qi (೘), Shanghai Jiageng Culture Communication Co., Ltd. (ֲ
ʮ̡) and the Company, pursuant to which, among other things, the
parties agreed to terminate certain special rights granted to Suzhou Bodao Dinghua
Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ(Ϟ
Υྫ));
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-10 –


--- page 698 ---
(dd) the supplemental agreement to the investment (capital increase) agreement ( ҳ༟(ᄣ
༟)՘ᙄʘ໾̂՘ᙄ) dated June 22, 2023 entered into amongst Chengdu Technology
Innovation Investment Group Co., Ltd. (ʮ̡), Chengdu
Tongchuang Zhixing Enterprise Management Consulting Partnership (Limited
Partnership) (БΆุ၍ଣፔ༔ΥྫΆุ(Υྫ)), Shanghai
V oicecomm Rongzhi Technology Group Co., Ltd. (ʮ
̡), Mr. Tang Jinghua ( ಷหശ), Mr. Shi Yerong ( ุͩᏌ), Shanghai Chenqi
Information Consultation Co., Ltd. (ʮ̡), Mr. Sun Qi (࢑
೘), Shanghai Jiageng Culture Communication Co., Ltd. (ʮ
̡), and the Company, pursuant to which, among other things, the parties agreed to
terminate certain special rights granted to Chengdu Technology Innovation
Investment Group Co., Ltd. (ʮ̡) and Chengdu
Tongchuang Zhixing Enterprise Management Consulting Partnership (Б
Άุ၍ଣፔ༔ΥྫΆุ(Υྫ));
(ee) the share purchase agreement (ᛆϗᒅ՘ᙄ) dated November 28, 2022 entered into
amongst Xi’an Jinxuntong Software Technology Co., Ltd. (ৃஷழ΁ҦஔϞ
ʮ̡), Xian Jinxun Digital Intelligence Information Technology Co., Ltd. (ږ
ʮ̡), Mr. Han Zhaoning ( ᒵ̜ྐྵ), and the Company, pursuant
to which, among other things, the Company agreed to obtain 51% of the equity
interests of Xian Jinxun Digital Intelligence Information Technology Co., Ltd. ( Г
ʮ̡) partly through acquisition from Xi’an Jinxuntong
Software Technology Co., Ltd (ʮ̡) and partly through
capital injection at the total consideration of RMB28,050,000;
(ff) the supplemental agreement (II) to the share purchase agreement (ᛆϗᒅ՘ᙄʘ
໾̂՘ᙄ(ɚ)) dated June 2, 2023 entered into amongst Shanghai V oicecomm
Rongzhi Technology Group Co., Ltd. (ʮ̡), Xi’an
Jinxuntong Software Technology Co., Ltd. (ʮ̡), Xian
Jinxun Digital Intelligence Information Technology Co., Ltd. (Ҧ
ʮ̡), Mr. Han Zhaoning ( ᒵ̜ྐྵ), and the Company, pursuant to which,
among other things, the parties agreed to amend the terms of acquisition of equity
interests of Xian Jinxun Digital Intelligence Information Technology Co., Ltd. ( Г
ʮ̡);
(gg) the cornerstone investment agreement ( ਿͩҳ༟՘ᙄ) dated June 25, 2024 entered
into amongst the Company, Wuhan Guangtong Gongying Enterprise Management
Partnership (Limited Partnership) (ဏΈஷ΍ᙊΆุ၍ଣΥྫΆุ(Υྫ)) and
China International Capital Corporation Hong Kong Securities Limited (ږ
ʮ̡), pursuant to which Wuhan Guangtong Gongying Enterprise
Management Partnership (Limited Partnership) (ဏΈஷ΍ᙊΆุ၍ଣΥྫΆุ
(Υྫ)) has agreed to subscribe for at the Offer Price (i) the number of H Shares
(rounded down to the nearest whole board lot of 20 H Shares) that may be purchased
with an amount of Hong Kong dollar equivalent of RMB200.0 million (exclusive of
brokerage, SFC transaction levy, Stock Exchange trading fee, and AFRC transaction
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-11 –


--- page 699 ---
levy), or (ii) 33.3% of the number of Offer Shares offered under the Global Offering
(rounded down to the nearest whole board lot of 20 H Shares and assuming that the
Over-allotment Option is not exercised), whichever the lower;
(hh) the cornerstone investment agreement ( ਿͩҳ༟՘ᙄ) dated June 25, 2024 entered
into amongst the Company, Jiangsu Jiangkong Investment Co., Ltd. ( ϪᘽϪછҳ༟
ʮ̡), China International Capital Corporation Hong Kong Securities Limited
(ʮ̡) and Orient Securities (Hong Kong) Limited (؇
˙ᗇՎ(ಥ)ʮ̡), pursuant to which Jiangsu Jiangkong Investment Co., Ltd.
(ʮ̡) has agreed to subscribe for at the Offer Price the number
of H Shares (rounded down to the nearest whole board lot of 20 H Shares) that may
be purchased with an amount of Hong Kong dollar equivalent of RMB50.0 million
(inclusive of brokerage, SFC transaction levy, Stock Exchange trading fee, and
AFRC transaction levy); and
(ii) the Hong Kong Underwriting Agreement.
2. Our Material Intellectual Property Rights
(a) 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
Place of
registration
Name of
registered
proprietor
Registration
no. Class Expiry date
1.
PRC Our Company 13692715 42 February 13,
2035
2.
 PRC Our Company 13692705 42 February 6,
2035
3.
 PRC Our Company 13692687 42 February 13,
2035
4.
 PRC Our Company 13692486 38 February 13,
2035
5.
 PRC Our Company 13692419 35 August 13,
2035
6.
 PRC Our Company 13692415 35 February 14,
2035
7.
 PRC Our Company 13692400 35 February 13,
2035
8.
 PRC Our Company 70966685 42 November 13,
2033
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-12 –


--- page 700 ---
As of the Latest Practicable Date, we had registered the following trademark in Hong
Kong which we consider to be or may be material to our business:
No. Trademark
Registration
number Class
Name of
owner
Place of
registration Expiry date
1A
 B
 306252813 9, 16, 35,
38, 42
Our Company Hong Kong May 24,
2033
C
 D
(b) Patents
As of the Latest Practicable Date, we had registered the following patents in the PRC
which we consider to be or may be material to our business:
NO. Patent
Name of
registered
owner
Patent
category Patent number
Date of
application
Validity period
(from the
application
date)
1. Fine-grained preemptive
resource scheduling
system and method
based on container
cluster platform (׵
ܓ
ӻ୕ʿ
ج)Note s1&3 )
Our Company Invention 201811198082X October 15,
2018
20 years
2. Quality of service
assurance methods and
systems for deep
learning tasks based on
container clusters ( ਿ
ኪ୦
ج
ձӻ୕) (Note s2&3 )
Our Company Invention 2019106720780 July 24, 2019 20 years
3. A big data analysis
device ( ɓ၇ɽᅰኽʱ
ༀໄ) (Note 4)
Jinxun Digital
Intelligence
Utility
model
2021200475595 January 8,
2021
10 years
4. A device for classifying
and identifying reports
of hotline information
on epidemic rumors
and appeals ( ɓ၇ᆠᇞ
ઋᑼԊൡӋᑘ
జʱᗳᗆйༀໄ)
(Note 4)
Jinxun Digital
Intelligence
Utility
model
2021200475472 January 8,
2021
10 years
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-13 –


--- page 701 ---
NO. Patent
Name of
registered
owner
Patent
category Patent number
Date of
application
Validity period
(from the
application
date)
5. A data management
system for intelligent
knowledge base ( ɓ၇
ᅰኽ၍ଣӻ
୕) (Note 4)
Jinxun Digital
Intelligence
Utility
model
2020229632208 December 10,
2020
10 years
6. A big data analysis
system for government
hotlines (ਕᆠᇞ
ӻ୕)
(Note 4)
Jinxun Digital
Intelligence
Utility
model
2020229685879 December 10,
2020
10 years
Notes:
1. The patent application was filed by Shanghai Jiao Tong University ( ɪऎʹஷɽኪ) on October 15, 2018 in the
PRC and issued on April 2, 2021 to Shanghai Jiao Tong University ( ɪऎʹஷɽኪ).
2. The patent application was filed by Shanghai Jiao Tong University ( ɪऎʹஷɽኪ) on July 24, 2019 in the PRC
and issued on February 25, 2022 to Shanghai Jiao Tong University ( ɪऎʹஷɽኪ).
3. Pursuant to the intellectual property transfer contract entered into between our Company and Shanghai Jiao
Tong University ( ɪऎʹஷɽኪ) dated August 5, 2022, Shanghai Jiao Tong University agreed to transfer the
ownership of the patents to our Company at the consideration of RMB100,000. Our Company is the current
owner of the patents in the PRC.
4. Pursuant to the equity transfer agreement entered into between our Company and Jinxuntong Software
Technology and Jinxun Digital Intelligence dated November 28, 2022, we acquired 51% equity interest in
Jinxun Digital Intelligence partly through the acquisition from Jinxuntong Software Technology and partly
through a capital injection, as part of the acquisition of assets. Jinxuntong Software Technology has transferred
the ownership of the four patents to Jinxun Digital Intelligence in accordance with the terms of the equity
transfer agreement. Jinxun Digital Intelligence is currently the owner of the four patents in the PRC.
As of the Latest Practicable Date, we had applied for registration of the following patents
in the PRC which we consider to be or may be material to our business:
No. Patent
Name of
applicant
Patent
category
Application
number
Date of
application
1. Similarity-based workflow
activity alignment methods
and systems (ʈ
ʿӻ୕)
Our Company,
Shanghai
Jiao Tong
University ( ɪ
ऎʹஷɽኪ)
Invention 202210866673X July 22, 2022
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-14 –


--- page 702 ---
No. Patent
Name of
applicant
Patent
category
Application
number
Date of
application
2. Method and system for cross-
channel irrelevant-content-
speaker recognition based on
adversarial learning (࿁Ҥ
ೌᗫႭ༑ɛ
ʿӻ୕)
Our Company,
Shanghai
Jiao Tong
University ( ɪ
ऎʹஷɽኪ)
Invention 2022102617886 March 17,
2022
3. Method and system for event
matching based on hardware
contextual computing in
content distribution systems
(ʱ೯ӻ୕ʕ೷΁༶ၑ
ʿӻ୕)
Our Company,
Shanghai
Jiao Tong
University ( ɪ
ऎʹஷɽኪ)
Invention 2021116784409 December 31,
2021
4. Container GPU resource
monitoring system in a
container cluster environment
(ኜGPU༟๕
္છӻ୕)
Our Company,
Shanghai
Jiao Tong
University ( ɪ
ऎʹஷɽኪ)
Invention 2021116011129 December 24,
2021
5. An artificial intelligence-based
marketing data screening and
analysis system (ɛʈ
ӻ୕)
Our Company Invention 2021112249034 October 21,
2021
6. A natural language-based content
moderation system (׵
ӻ୕)
Our Company Invention 2021106538395 June 11, 2021
7. An intelligent customer service
system for financial products
(ӻ୕)
Our Company Invention 2021105778599 May 26, 2021
8. An intelligent logistics customer
service robot (܄ݴي
ዚኜɛ)
Our Company Invention 2021105779036 May 26, 2021
9. An intelligent interaction
platform based on automatic
speech recognition and natural
language processing (׵
ᗆйձІ್ႧԊஈଣ
౽ঐʹʝ̨̻)
Our Company Invention 2021105794801 May 26, 2021
10. An intelligent logistics customer
service robot based on voice
information analysis (׵
؂܄ݴي
ዚኜɛ)
Our Company Invention 2021105795344 May 26, 2021
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-15 –


--- page 703 ---
No. Patent
Name of
applicant
Patent
category
Application
number
Date of
application
11. An intelligent voice customer
service exchange system ( ɓ၇
ʹ౬ӻ୕)
Our Company Invention 2021105795359 May 26, 2021
12. An intelligent car maintenance
robot (ዚኜ
ɛ)
Our Company Invention 2021106061600 May 26, 2021
13. A system and method for data
storage used in AI learning
models (ɛʈ౽ঐኪ୦ᅼ
ج)
Our Company Invention 202311721155X December 13,
2023
14. A system and method for energy
efficiency AI analysis ( ɓ၇ঐ
ج)
Our Company Invention 2023117168210 December 13,
2023
15. A system and method for AI
service (ਕӻ
ج)
Our Company Invention 2023117174353 December 13,
2023
16. System and method for network-
based video security inspection
(ൖ᎖τԣԚᏨ
ج)
Our Company Invention 2024100201004 January 6,
2024
17. A method for online deep
learning inference service
partitioning based on
serverless computing (ೌ
ኪ୦પ
ج)
Our Company Invention 2024101641675 February 5,
2024
18. Method and system for meta-
universe data transmission and
exchange based on the
convergence of foundations
(ᅰኽෂ
ʿӻ୕)
Our Company Invention 2024101934977 February 21,
2024
19. Method and system for the
monitoring and management of
smart city based on multi-
domain data integration and
analysis (εჯਹᅰኽ዆Υ
ج
ʿӻ୕)
Our Company Invention 2024101934943 February 21,
2024
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-16 –


--- page 704 ---
No. Patent
Name of
applicant
Patent
category
Application
number
Date of
application
20. A method and system for online
customer service real-time
assignment (ࣛ
ձӻ୕)
Our Company Invention 2024103200037 March 20,
2024
21. A method and system for
navigation and path planning
of automatic driving and
unmanned delivery vehicle
(ɓ၇Іਗቷትೌɛৣ৔ԓሿኬ
ʿӻ୕)
Our Company Invention 2024103203340 March 20,
2024
22. A system for intelligent
unmanned retail automated
interaction system ( ɓ၇౽ঐೌ
ɛཧਯІਗʹʝӻ୕)
Our Company Invention 2024102542234 March 6, 2024
23. A method and system for
medical video online diagnosis
and treatment ( ɓ၇ᔼᐕൖ᎖ί
ʿӻ୕)
Our Company Invention 2024102449324 March 5, 2024
24. A method and system for driving
route decision-making of
unmanned vehicle ( ɓ၇ೌɛቷ
ʿ
ӻ୕)
Our Company Invention 2024102427217 March 4, 2024
25. A system and method for
intelligent security surveillance
management based on video
analysis (ٙؓ
ج)
Our Company Invention 2024102316873 March 1, 2024
26. A system and method for
industrial IOT inspection
based on online video ( ɓ၇ਿ
ᑌၣԚᏨ
ج)
Our Company Invention 2024102285447 February 29,
2024
27. An unmanned medium bus
scheduling system and
method (ܓ
ج)
Our Company Invention 2024103200056 March 20,
2024
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-17 –


--- page 705 ---
(c) Software Copyrights
As of the Latest Practicable Date, we had registered the following software copyrights in
the PRC which we consider to be or may be material to our business:
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
1. V oicecomm multimedia access
gateway platform ( ᑊஷεద᜗ટ
ɝၣᗫ̨̻)
Our Company 2022SR0580839 May 12, 2022
2. V oicecomm multimedia softswitch
(ᑊஷεద᜗ழʹ౬̨̻)
Our Company 2022SR0580840 May 12, 2022
3. V oicecomm voice annunciation
software (ᅧజழ΁)
Our Company 2022SR0580838 May 12, 2022
4. V oicecomm cross-platform
marketing and distribution system
(ᑊஷ༨̨̻ᐄቖ೯бӻ୕)
Our Company 2022SR0323811 March 8, 2022
5. Intelligent computing service system
(ਕӻ୕)
Our Company,
Shanghai Jiao
Tong University
(ɪऎʹஷɽኪ)
2022SR0186866 January 28, 2022
6. EPS e-procurement financial
docking software (EPS ཥɿમᒅৌ
ਕ࿁ટழ΁)
Our Company 2021SR0793280 May 28, 2021
7. SCRM Social customer relationship
management system (SCRMึ
၍ଣӻ୕)
Our Company 2021SR0652709 May 10, 2021
8. V oicecomm AI intelligent outbound
call platform software ( ᑊஷAI౽
ঐ̮խ̨̻ழ΁)
Our Company 2021SR0116747 January 21, 2021
9. V oicecomm ASR intelligent speech
recognition platform software ( ᑊ
ஷASRᗆй̨̻ழ΁)
Our Company 2021SR0116651 January 21, 2021
10. V oicecomm’s high-precision
positioning and airport-specific
high-precision map, real-time
video, risk alert dynamic
management system software
system (Зၾዚఙਖ਼
ᎈѓ
ᙆਗ࿒၍ଣӻ୕ழ᜗ӻ୕)
Our Company 2020SR1622789 November 23, 2020
11. V oicecomm product lifecycle data
collection system (͛ն
඄ಂᅰኽમණӻ୕)
Our Company 2020SR1622786 November 23, 2020
12. V oicecomm new energy vehicle
safety driving management system
(ᑊஷอঐ๕ԓሿτΌቷት၍ଣӻ
୕)
Our Company 2020SR1622785 November 23, 2020
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-18 –


--- page 706 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
13. V oicecomm’s cross-platform front-
end in-vehicle video safety
monitoring system (ۃ
၌ԓ༱ൖ᎖τΌ္છ၍ଣӻ୕)
Our Company 2020SR1618059 November 20, 2020
14. V oicecomm emission standard
integrated environmental
management system (ᅺ
ɓ᜗ʷ၍ଣӻ୕)
Our Company 2020SR1618060 November 20, 2020
15. V oicecomm IoT spatial design
management system (ᑌၣ
၍ଣӻ୕)
Our Company 2020SR1618013 November 20, 2020
16. V oicecomm IoT safety data analysis
system (ؓ
ӻ୕)
Our Company 2020SR1618012 November 20, 2020
17. V oicecomm video processing and
safety management integrated
system software ( ᑊஷൖ᎖ஈଣၾ
τΌ၍ଣණϓӻ୕ழ΁)
Our Company 2020SR1618011 November 20, 2020
18. V oicecomm high precision
intelligent vehicle management
service software (౽ᅆ
ਕழ΁)
Our Company 2020SR1617687 November 20, 2020
19. V oicecomm big data-based driving
behavior analysis system
development software (ɽ
ӻ୕ක೯
ழ΁)
Our Company 2020SR1617689 November 20, 2020
20. V oicecomm high-precision BeiDou-
based driving risk assessment
management software (̏
ᎈ൙П၍ଣழ
΁)
Our Company 2020SR1617688 November 20, 2020
21. V oicecomm IoT data collection
management system (ᑌၣ
ᅰኽમණ၍ଣӻ୕)
Our Company 2020SR1617634 November 20, 2020
22. V oicecomm Internet-based call
centre management system ( ᑊஷ
խ̣ʕː၍ଣӻ୕)
Our Company 2020SR1616552 November 20, 2020
23. V oicecomm intelligent marketing
management robot platform
software ( ᑊஷ౽ঐᐄቖ၍ଣዚኜ
ɛ̨̻ழ΁)
Our Company 2020SR0056664 January 13, 2020
24. V oicecomm intelligent robot
customer service management
software (؂
ਕ၍ଣழ΁)
Our Company 2019SR1202258 November 23, 2019
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-19 –


--- page 707 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
25. V oicecomm cloud-based customer
service software (ழ΁)
Our Company 2018SR079384 January 31, 2018
26. V oicecomm multimedia customer
service system (ӻ
୕)
Our Company 2018SR078648 January 31, 2018
27. V oicecomm amany call centre
software ( ᑊஷAmany խ̣ʕːழ
΁)
Our Company 2018SR077897 January 31, 2018
28. V oicecomm amany call centre
system software ( ᑊஷථխ̣ʕː
ӻ୕ழ΁)
Our Company 2016SR233905 August 25, 2016
29. V oicecomm all media intelligent car
network call centre system
Software ( ᑊஷΌద᜗౽ঐԓᑌၣ
խ̣ʕːӻ୕ழ΁)
Our Company 2016SR230929 August 23, 2016
30. V oicecomm amany call center
software ( ᑊஷAmany խ̣ʕːழ
΁)
Our Company 2016SR228126 August 22, 2016
31. V oicecomm multimedia marketing
platform software ( ᑊஷεద᜗ᐄ
ቖ̨̻ழ΁)
Our Company 2015SR115834 June 25, 2015
32. V oicecomm hospital department
system management software ( ᑊ
ӻ୕၍ଣழ΁)
Our Company 2014SR148732 October 9, 2014
33. V oicecomm configuration
management system software
(ᑊஷৣໄ၍ଣӻ୕ழ΁)
Our Company 2014SR111934 August 4, 2014
34. V oicecomm meter monitoring
software (္છழ΁)
Our Company 2014SR111856 August 4, 2014
35. V oicecomm air call management
platform software (խ̣
၍ଣ̨̻ழ΁)
Our Company 2014SR111938 August 4, 2014
36. V oicecomm billing system reporting
software (ழ΁)
Our Company 2014SR111421 August 4, 2014
37. V oicecomm e-commerce agent
application software (ࢭ
Ꮠ͜ழ΁)
Our Company 2014SR111414 August 4, 2014
38. V oicecomm CRM software for
futures business ( ᑊஷಂ஬ุਕ
CRMழ΁)
Our Company 2014SR111418 August 4, 2014
39. V oicecomm SMS platform software
(̨̻ழ΁)
Our Company 2012SR063819 July 16, 2012
40. V oicecomm IVR server software ( ᑊ
ஷIVR
ਕኜழ΁)
Our Company 2012SR062047 July 11, 2012
41. V oicecomm agent software (ࢭ
ழ΁)
Our Company 2012SR060379 July 6, 2012
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-20 –


--- page 708 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
42. V oicecomm logistics CRM software
(ݴيCRMழ΁)
Our Company 2012SR060382 July 6, 2012
43. V oicecomm call center CRM
software ( ᑊஷխ̣ʕːCRMழ΁)
Our Company 2012SR060388 July 6, 2012
44. V oicecomm Amany multimedia call
centre software ( ᑊஷAmany εద
᜗խ̣ʕːழ΁)
Our Company 2006SR04427 April 13, 2006
45. Big data intelligent speech semantic
analysis system (ࠪ
ӻ୕)
Our Company 2022SR1263814 August 24, 2022
46. Multimedia call center integrated
service system ( εద᜗խ̣ʕːၝ
ਕӻ୕)
Our Company 2022SR1263858 August 24, 2022
47. Intelligent internet dynamic video
management system ( ౽ঐʝᑌၣ
ਗ࿒ൖ᎖၍ଣӻ୕)
Our Company 2022SR1264045 August 24, 2022
48. Multidimensional data speech
semantic analysis and traceability
system (ؓ
ၾ๑๕ӻ୕)
Our Company 2022SR1264044 August 24, 2022
49. V oicecomm NLP semantic analysis
system ( ᑊஷNLPӻ
୕)
Our Company 2022SR1264043 August 24, 2022
50. V oicecomm TTS speech
transcription software ( ᑊஷTTSႧ
ᔷᙇழ΁)
Our Company 2022SR1264042 August 24, 2022
51. Video call center business
management system ( ൖ᎖խ̣ʕ
ːุਕ၍ଣӻ୕)
Our Company 2022SR1263889 August 24, 2022
52. Cloud-based intelligent quality
inspection system ( ථ၌౽ঐሯᏨ
ӻ୕)
Our Company 2022SR1263888 August 24, 2022
53. 5G video call center systems (5G ൖ
᎖խ̣ʕːӻ୕)
Our Company 2022SR1263887 August 24, 2022
54. Intelligent video online inspection
management software ( ౽ঐൖ᎖ί
ᇞᏨ಻၍ଣழ΁)
Our Company 2022SR1264170 August 24, 2022
55. OCR image and text recognition
system of V oicecomm ( ᑊஷocrྡ
˪˖οᗆйӻ୕)
Our Company 2024SR0030180 January 4, 2024
56. Digital smart campus platform of
V oicecomm (෤̻
̨)
Our Company 2024SR0165389 January 25, 2024
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-21 –


--- page 709 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
57. Smart campus management software
of V oicecomm (෤၍ଣ
ழ΁)
Our Company 2024SR0160431 January 24, 2024
58. Integrated bioinformatics online
platform (ίᇞිᐼ
̨̻)
Our Company 2023SR1261368 October 19, 2023
59. Visualized intelligent evaluation
management system for customer
service platform (؂܄
ਕ൙ᄆ၍ଣӻ୕)
Our Company 2023SR1255156 October 18, 2023
60. Safety production quality evaluation
system ( τΌ͛ପሯඎ൙಻ӻ୕)
Our Company 2023SR1253694 October 18, 2023
61. Intelligent portrait appraisal data
evaluation management system
(ᅰኽ൙П၍ଣӻ୕)
Our Company 2023SR1253971 October 18, 2023
62. Vehicle behavior monitoring
platform (္಻̨̻)
Our Company 2023SR1254211 October 18, 2023
63. Visualized supervision platform for
the asset catalog of data
development ( ᅰኽක೯༟ପͦ፽̙
ൖʷ္၍̨̻)
Our Company 2023SR1254837 October 18, 2023
64. Enterprise AI application data
backup management platform ( Ά
ุɛʈ౽ঐᏐ͜ᅰኽ௪΅၍ଣ̻
̨)
Our Company 2023SR1245064 October 17, 2023
65. R&D and technical service data
collection and analysis system (޼
ӻ୕)
Our Company 2023SR1247252 October 17, 2023
66. Platform for the collection and
processing of big data from videos
(ൖ᎖ɽᅰኽમණஈଣ̨̻)
Our Company 2023SR1247137 October 17, 2023
67. Platform for the exploration,
analysis and processing of
visualized data (ઢʱ
ஈଣ̨̻)
Our Company 2023SR1246719 October 17, 2023
68. Visualized management system for
integrated bioanalytical data ( ණϓ
ᅰኽ̙ൖʷ၍ଣӻ୕)
Our Company 2023SR1221898 October 12, 2023
69. Information management platform
for intelligent artificial digital
twins (၍ଣ
̨̻)
Our Company 2023SR1224135 October 12, 2023
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-22 –


--- page 710 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
70. Commercial OCR information
aggregation platform ( ਠุOCRڦ
ිᐼ̨̻)
Our Company 2023SR1222702 October 12, 2023
71. 3D display platform for intelligence
operation data of smart city ( ౽ᅆ
̨̻ͪ)
Our Company 2023SR1217582 October 11, 2023
72. Management system for the process
planning of AI smart application
development (AIݴ
೻஝ྌ၍ଣӻ୕)
Our Company 2023SR1216975 October 11, 2023
73. A system for intelligent computing
service (ਕӻ୕)
Our Company 2024SR0438160 March 27, 2024
74. A software for intelligent store
management platform (၍
ଣ̨̻ழ΁)
Chongqing
V oicecomm
2024SR0795784 June 12, 2024
75. Intelligent robot voice recognition
system (ᗆйӻ୕)
Shandong
V oicecomm
Information
Technology
2022SR0713931 June 7, 2022
76. Intelligent cloud communication
messaging process monitoring and
management system (ڦ
ෂ჈ཀ೻္ຖ၍ଣӻ୕)
Shandong
V oicecomm
Intelligent
Technology
2022SR0620291 May 23, 2022
77. Cuiwen CRM customer management
software ( യਪCRM˒၍ଣழ΁)
(Note 1)
Yuanya Information 2021SR0073260 January 14, 2021
78. Cuiwen CRM specific data import
software ( യਪCRMᅰኽኬɝ
ழ΁) (Note 1)
Yuanya Information 2021SR0073420 January 14, 2021
79. Cuiwen CRM system operation
monitoring and configuration
centre software ( യਪCRMӻ୕༶
Б္છৣໄʕːழ΁) (Note 1)
Yuanya Information 2021SR0073421 January 14, 2021
80. Cuiwen CRM operation statistics
software ( യਪCRMࠇ
ழ΁) (Note 1)
Yuanya Information 2021SR0073257 January 14, 2021
81. Cuiwen POC car option and
recommendation management
platform software ( യਪPOCӛԓ
፯ৣʿપᑥ၍ଣ̨̻ழ΁)
(Note 1)
Yuanya Information 2021SR0073422 January 14, 2021
82. Cuiwen POC car sales software ( യ
ਪPOCӛԓቖਯழ΁) (Note 1)
Yuanya Information 2021SR0073258 January 14, 2021
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-23 –


--- page 711 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
83. Cuiwen customer file operation and
maintenance management centre
software (༶ၪ၍ଣ
ʕːழ΁) (Note 1)
Yuanya Information 2021SR0074129 January 14, 2021
84. Cuiwen car e-commerce platform
software ( യਪӛԓཥਠ̨̻ழ΁)
(Note 1)
Yuanya Information 2021SR0073414 January 14, 2021
85. Cuiwen car e-commerce
management backend software ( യ
̨ழ΁)
(Note 1)
Yuanya Information 2021SR0073259 January 14, 2021
86. Cuiwen e-commerce after-sales order
management platform software ( യ
ఊ၍ଣ̨̻ழ΁)
(Note 1)
Yuanya Information 2021SR0073430 January 14, 2021
87. Cuiwen CRM data integration
software ( യਪཥਠ̨̻CRMࣘ
ණϓழ΁) (Note 1)
Yuanya Information 2021SR0073429 January 14, 2021
88. Cuiwen pre-sales order centre
software (ఊʕː
ழ΁) (Note 1)
Yuanya Information 2021SR0074128 January 14, 2021
89. Cuiwen unified registration and
login center software ( യਪ୕ɓൗ
̅೮፽ʕːழ΁) (Note 1)
Yuanya Information 2021SR0073423 January 14, 2021
90. Yuanya vehicle delivery process
management software (ݴ
೻၍ଣழ΁)
Yuanya Information 2022SR0377365 March 22, 2022
91. Yuanya auto direct sales automation
process control software ( ଀ඩӛ
೻છՓழ΁)
Yuanya Information 2022SR0376463 March 22, 2022
92. Yuanya electric vehicle charging
security software ( ଀ඩཥਗӛԓ̂
ཥτΌழ΁)
Yuanya Information 2023SR0840309 July 17, 2023
93. Yuanya electric vehicle charging pile
data information management
system ( ଀ඩཥਗӛԓ̂ཥᅸᅰኽ
၍ଣӻ୕)
Yuanya Information 2023SR0867143 July 21, 2023
94. Yuanya automotive customer lead
research platform software ( ଀ඩ
Ӻ̨̻ழ΁)
Yuanya Information 2023SR0840319 July 17, 2023
95. Yuanya automobile configurator tool
debugging and improvement
software ( ଀ඩӛԓৣໄኜʈՈሜ
༊ҷආழ΁)
Yuanya Information 2023SR0840320 July 17, 2023
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-24 –


--- page 712 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
96. Yuanya private domain traffic
monetization software ( ଀ඩӷਹ
ඎᜊତழ΁)
Yuanya Information 2023SR0840308 July 17, 2023
97. Yuanya sales commission ratio
setting software (ˢ
Էணໄழ΁)
Yuanya Information 2023SR0844098 July 18, 2023
98. Yuanya sales commission intelligent
distribution system (ږ
౽ঐʱ೯ӻ୕)
Yuanya Information 2023SR0867118 July 21, 2023
99. Yuanya user feedback research
platform (̨̻)
Yuanya Information 2023SR0867117 July 21, 2023
100. Yuanya user management software
(଀ඩ͜˒၍ଣழ΁)
Yuanya Information 2023SR0844191 July 18, 2023
101. Yuanya user evaluation intelligent
control software ( ଀ඩ͜˒൙ᄆ౽
ঐછՓழ΁)
Yuanya Information 2023SR0844249 July 18, 2023
102. Yuanya user rights center data
statistics software ( ଀ඩ͜˒ᛆू
ழ΁)
Yuanya Information 2023SR0844258 July 18, 2023
103. Yuanya user experience deep
computing algorithm design
system (ၑၑ
ӻ୕)
Yuanya Information 2023SR0867116 July 21, 2023
104. Yuanya intelligent omni-channel
portal management control system
(˒၍ଣછՓ
ӻ୕)
Yuanya Information 2024SR0848908 June 21, 2024
105. Digital village data governance
system (ଣӻ୕)
Jinxun Digital
Intelligence
2023SR0538106 May 12, 2023
106. Digital village internet government
service system (݁
ਕӻ୕)
Jinxun Digital
Intelligence
2023SR0537958 May 12, 2023
107. Digital rural smart elderly care
system ( ᅰοඊӀ౽ᅆቮϼӻ୕)
Jinxun Digital
Intelligence
2023SR0537867 May 12, 2023
108. Digital village data asset
management platform ( ᅰοඊӀᅰ
ኽ༟ପ၍ଣ̨̻)
Jinxun Digital
Intelligence
2023SR0537852 May 12, 2023
109. Jinxuntong targeted poverty
alleviation publicity system (ৃ
ෂӻ୕)
(Note 2)
Jinxun Digital
Intelligence
2023SR0826630 July 11, 2023
110. Jinxuntong housing provident fund
hotline service system (ৃஷИ
ਕӻ୕) (Note 2)
Jinxun Digital
Intelligence
2023SR0826589 July 11, 2023
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-25 –


--- page 713 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
111. Jinxuntong real estate customer
service call center system (ৃஷ
խ̣ʕːӻ୕) (Note 2)
Jinxun Digital
Intelligence
2023SR0826605 July 11, 2023
112. Jinxuntong emergency command and
dispatch system (౨
ӻ୕) (Note 2)
Jinxun Digital
Intelligence
2023SR0826606 July 11, 2023
113. Jinxuntong 12345 data
standardization cloud platform (ږ
ৃஷ12345 ᅰኽᅺ๟ʷථ̨̻)
(Note 2)
Jinxun Digital
Intelligence
2023SR0826604 July 11, 2023
114. Jinxuntong big letters and visits
platform system (ஞ̻
̨ӻ୕) (Note 2)
Jinxun Digital
Intelligence
2023SR0826607 July 11, 2023
115. Digital village big data management
system (၍ଣӻ୕)
Jinxun Digital
Intelligence
2023SR1177581 September 28, 2023
116. Digital rural one-stop management
system ( ᅰЗඊӀɓ໮ஷ၍ଣӻ୕)
Jinxun Digital
Intelligence
2023SR1171657 September 27, 2023
117. Cloud-based rural one-code
management system ( ථɪඊӀɓ
ᇁஷ၍ଣӻ୕)
Jinxun Digital
Intelligence
2023SR1177951 September 28, 2023
118. 12345 smart assistant system of
Jinxuntong (ৃஷ12345 ౽ঐп˓
ӻ୕) (Note 2)
Jinxun Digital
Intelligence
2024SR0324212 February 28, 2024
119. Big data analysis system for
government affairs hotlines of
Jinxuntong (ਕᆠᇞɽᅰ
ӻ୕) (Note 2)
Jinxun Digital
Intelligence
2024SR0323791 February 28, 2024
120. 12345 intelligent system for the
classification of work orders of
Jinxuntong (ৃஷ12345 ʈఊ౽ঐ
ʱᗳӻ୕) (Note 2)
Jinxun Digital
Intelligence
2024SR0323764 February 28, 2024
121. 12345 customized reporting system
of Jinxuntong (ৃஷ
12345֛
ӻ୕) (Note 2)
Jinxun Digital
Intelligence
2024SR0323779 February 28, 2024
122. 12345 smart work order system of
Jinxun Digital Intelligence (ৃ
ᅰ౽12345 ౽ঐʈఊӻ୕)
Jinxun Digital
Intelligence
2024SR0028448 January 4, 2024
123. Entity intelligent extraction system
of Jinxun Digital Intelligence (ږ
ৃᅰ౽ྼ᜗౽ঐ౤՟ӻ୕)
Jinxun Digital
Intelligence
2024SR0028540 January 4, 2024
124. 12345 multi-level assessment system
of Jinxun Digital Intelligence (ږ
ৃᅰ౽12345ӻ୕)
Jinxun Digital
Intelligence
2024SR0028560 January 4, 2024
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-26 –


--- page 714 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
125. Work order centralized research and
judgment system of Jinxun Digital
Intelligence (޼
кӻ୕)
Jinxun Digital
Intelligence
2024SR0028565 January 4, 2024
126. 12345 smart platform system of
Jinxun Digital Intelligence (ৃ
ᅰ౽12345 ౽ᅆ̨̻ӻ୕)
Jinxun Digital
Intelligence
2024SR0028570 January 4, 2024
127. 12345 government service hotline
system of Jinxuntong (ৃஷ
12345͏ᆠᇞӻ୕)
(Note 2)
Jinxun Digital
Intelligence
2024SR0323768 February 28, 2024
128. 12345 government service one
number system of Jinxuntong (ږ
ৃஷ12345ਕɓ໮ஷӻ୕)
(Note 2)
Jinxun Digital
Intelligence
2024SR0323395 February 28, 2024
129. 12345 government service one
number system of Jinxuntong (ږ
ৃஷ12345ਕɓ໮ஷӻ୕)
(Note 2)
Jinxun Digital
Intelligence
2024SR0323401 February 28, 2024
130. 12345 artificial intelligence
application system of Jinxuntong
(ৃஷ12345 ɛʈ౽ঐᏐ͜ӻ୕)
(Note 2)
Jinxun Digital
Intelligence
2024SR0323370 February 28, 2024
131. Performance monitoring system of
12345 government service of
Jinxuntong (ৃஷ12345ਕᆠᇞ
ঐ္࿀ӻ୕) (Note 2)
Jinxun Digital
Intelligence
2024SR0323384 February 28, 2024
132. Big data analysis platform V2.0 of
Jinxuntong (̻
̨V2.0) (Note 2)
Jinxun Digital
Intelligence
2024SR0323816 February 28, 2024
133. Jinxun Digital Call Center System
(ৃஷխ̣ʕːӻ୕) (Note 2)
Jinxun Digital
Intelligence
2024SR0589690 April 30, 2024
134. Intelligent customer service call
center service system of
V oicecomm (խ̣ʕ
ਕӻ୕)
Hainan V oicecomm
Intelligent
Technology
2024SR0238820 February 6, 2024
135. Intelligent vehicle management
service software ( ౽ঐʷԓሿ၍ଣ
ਕழ΁)
Hainan V oicecomm
Intelligent
Technology
2024SR0226784 February 4, 2024
136. Intelligent cloud-based customer
service multimedia system ( ౽ঐ
εద᜗ӻ୕)
Hainan V oicecomm
Intelligent
Technology
2024SR0227164 February 4, 2024
137. Smart city maintenance and
operation management platform
(̹༶ၪ၍ଣ̨̻)
V oicecomm Jiachen 2024SR0170295 January 25, 2024
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-27 –


--- page 715 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
138. Smart parking management software
(౽ᅆ৾ԓ၍ଣழ΁)
V oicecomm Jiachen 2024SR0166424 January 25, 2024
139. V oice intelligent interactive system
(౽ঐʹʝӻ୕)
V oicecomm Jiachen 2024SR0166186 January 25, 2024
140. Big data basic service analysis
software (ழ
΁)
V oicecomm Jiachen 2024SR0170894 January 25, 2024
141. Parking Management Software (ԓ
၍ଣழ΁)
V oicecomm Jiachen 2024SR0165877 January 25, 2024
142. Big data monitoring and analysis
software (ழ΁)
V oicecomm Jiachen 2024SR0170306 January 25, 2024
143. Smart campus service platform
software (ਕ̨̻ழ΁)
V oicecomm Jiachen 2024SR0158988 January 24, 2024
144. A platform for operation and
maintenance of big data
advertisement ( ᄿѓɽᅰኽ༶ၪ̻
̨)
V oicecomm Jiachen 2024SR0151872 January 23, 2024
145. A system for advertisement data
analysis (ӻ୕)
V oicecomm Jiachen 2024SR0151860 January 23, 2024
146. A software for intelligent analysis
and examination on voice contents
(ழ΁)
V oicecomm Xuanwu 2023SR1653534 December 18, 2023
147. Amany call centre software of
V oicecomm (ᑊஷAmany խ̣ʕː
ழ΁)
V oicecomm Xuanwu 2023AR0000214 September 21, 2023
148. Smart area parking management
software ( ౽ᅆਜਹ৾ԓ၍ଣழ΁)
V oicecomm Xuanwu 2023SR1696250 December 20, 2023
149. Software for the collection,
monitoring and analysis of big
data (ழ΁)
V oicecomm Xuanwu 2023SR1656468 December 18, 2023
150. Risk and safety management and
control system for smart campus
(ᎈτΌ၍છӻ୕)
V oicecomm Xuanwu 2023SR1658185 December 18, 2023
151. Software for the data management
of anti-epidemic law enforcement
(ᅰኽ၍ଣழ΁)
V oicecomm Xuanwu 2023SR1612150 December 12, 2023
152. Basic technology platform for big
data ( ɽᅰኽਿᓾҦஔ̨̻)
V oicecomm Xuanwu 2023SR1614045 December 12, 2023
153. System for accurate placement and
distribution of big data
advertisements ( ɽᅰኽᄿѓၚ๟ҳ
ʿ೯бӻ୕)
V oicecomm Xuanwu 2023SR1617131 December 12, 2023
154. Smart city spatial information
support platform (ڦ
˕ᅟ̨̻)
V oicecomm Xuanwu 2023SR1617387 December 12, 2023
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-28 –


--- page 716 ---
No. Name of Software
Name of registered
proprietor
Registration
number
Date of
Registration
155. Disease tracing system and
production and information
management system software for
epidemic control (ष৛๑᜗ӻձ
၍ଣӻ୕ழ΁)
V oicecomm Xuanwu 2023SR1602963 December 11, 2023
156. Automatic intelligent voice response
software (Ꮠഈழ΁)
V oicecomm Xuanwu 2023SR1605909 December 11, 2023
157. Smart campus information platform
software (̨̻ழ΁)
V oicecomm Xuanwu 2023SR1606187 December 11, 2023
Notes:
1. Pursuant to the computer software copyright transfer contract entered into between Cuiwen Network and
Yuanya Information dated November 30, 2020, Cuiwen Network agreed to transfer the rights of such
software copyrights to Yuanya Information at a consideration of RMB1,000 per software copyright.
Yuanya Information is currently the owner of such software copyrights in the PRC.
2. Pursuant to the equity transfer agreement entered into between our Company and Jinxuntong Software
Technology and Jinxun Digital Intelligence dated November 28, 2022, we acquired 51% equity interest
in Jinxun Digital Intelligence partly through the acquisition from Jinxuntong Software Technology and
partly through a capital injection, as part of the acquisition of assets. Jinxuntong Software Technology
has transferred the rights of such software copyrights to Jinxun Digital Intelligence in accordance with
the terms of the equity transfer agreement. Jinxun Digital Intelligence is currently the owner of such
software copyrights in the PRC.
(d) Domain Name
As of the Latest Practicable Date, we had registered the following domain name in the
PRC which we consider to be or may be material to our business:
No. Domain name Registrant
Date of
registration Expiry date
1. voicecomm.cn Our Company November 18,
2005
November 18,
2026
2. voicecommsh.cn Our Company November 24,
2022
November 24,
2025
3. kxdbsoft.com Jinxun Digital
Intelligence
October 25, 2022 October 25, 2024
Save as aforesaid, as of the Latest Practicable Date, there were no other trade or service
marks, patents, intellectual or industrial property rights which were material in relation to our
business.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-29 –


--- page 717 ---
C. FURTHER INFORMATION ABOUT DIRECTORS, SUPERVISORS AND
SUBSTANTIAL SHAREHOLDERS
1. Disclosure of Interests
(a) Interests and short positions of the Directors, Supervisors and chief executive of the
Company in the Shares, underlying Shares and debentures of our Company and our
associated corporations
The following table sets out the interests and short positions of our Directors and chief
executive of our Company immediately following completion of the Global Offering and the
Conversion of Unlisted Shares into H Shares in our Shares, underlying Shares or debentures
of our Company or any of our associated corporations (within the meaning of Part XV of the
SFO) which will have to be notified to us and the Stock Exchange pursuant to Divisions 7 and
8 of Part XV of the SFO (including interests and short positions in which they are 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 to be notified to us and the Stock Exchange pursuant to the Model Code for Securities
Transactions by Directors of Listed Issuers contained in the Listing Rules, once our Shares are
listed:
Name of Director/
Chief Executive
Capacity/ nature
of interest
Description
of Shares
upon
completion
of the Global
Offering
and the
Conversion
of Unlisted
Shares into
H Shares
(8)
Number of
Shares
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company as
of the Latest
Practicable
Date(1)
Approximate
percentage of
shareholding in
the total share
capital of our
Company upon
completion of
the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Approximate
percentage of
shareholding in
our Unlisted
Shares/ H Shares
(as appropriate)
upon completion
of the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Mr. Tang (3) & (4) Beneficial owner;
interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-30 –


--- page 718 ---
Name of Director/
Chief Executive
Capacity/ nature
of interest
Description
of Shares
upon
completion
of the Global
Offering
and the
Conversion
of Unlisted
Shares into
H Shares
(8)
Number of
Shares
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company as
of the Latest
Practicable
Date(1)
Approximate
percentage of
shareholding in
the total share
capital of our
Company upon
completion of
the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Approximate
percentage of
shareholding in
our Unlisted
Shares/ H Shares
(as appropriate)
upon completion
of the Global
Offering
(assuming no
exercise of the
Over-allotment
Option) (2)
Mr. Sun (3) & (5) Beneficial owner;
interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
Mr. Yang
(3), (6) & (7) Interest in a
controlled
corporation;
interest held
jointly with
another person
Unlisted Shares 11,099,558 35.74% 31.33% 49.48%
H Shares 72,000 0.23% 0.20% 0.55%
Notes:
(1) The calculation is based on the total number of 31,059,230 Shares in issue as at the Latest Practicable Date,
including 22,433,317 Unlisted Shares and 8,625,913 Unlisted Shares which will be converted into H Shares
upon completion of the Global Offering.
(2) The calculation is based on the total number of 22,433,317 Unlisted Shares and 12,991,573 H Shares in issue
upon Listing (comprising (i) an aggregate of 8,625,913 Shares to be converted from Unlisted Shares; and (ii)
4,365,660 Shares to be issued pursuant to the Global Offering, (without taking into account the H Shares to
may be issued upon the exercise of Over-allotment Option).
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-31 –


--- page 719 ---
(3) Pursuant to the Concert Party Agreement dated March 20, 2021, Mr. Tang, Mr. Sun and Jiangfan Technology
agreed that they shall act in concert with respect to, inter alia, the right to convene board meetings and general
meetings, right to propose resolutions, nomination right, voting rights, nomination of senior management, and
other matters which are subject to approval in general meetings or board meetings of the Company, for the
period since the date of the Concert Party Agreement and up until they cease to hold any shares of the Company
or upon the termination of the Concert Party Agreement. For details, see “History, Development and Corporate
Structure – Concert Party Arrangement” in this prospectus. As such, each of the Concert Parties are deemed
to be interested in the Shares each other is interested in.
(4) As at the Latest Practicable Date, Shares in which Mr. Tang is interested consist of (i) 3,498,000 Unlisted
Shares held by him in his own personal capacity; (ii) 5,093,558 Unlisted Shares held by V oicecomm Rongzhi,
a company held as to 99% by Mr. Tang and 1% by his spouse Ms. Xu, in which Mr. Tang is deemed to be
interested under the SFO; and (iii) 2,580,000 Unlisted Shares (among which 72,000 Unlisted Shares will be
converted to H Shares upon Listing) in which Mr. Tang is deemed to be interested as a result of being a party
acting-in-concert with Mr. Sun and Jiangfan Technology.
(5) As at the Latest Practicable Date, Shares in which Mr. Sun is interested consist of (i) 1,800,000 Unlisted Shares
held by him in his own personal capacity; (ii) 540,000 Unlisted Shares held by Jiageng Culture, a company
wholly-owned by Mr. Sun, in which Mr. Sun is deemed to be interested under the SFO; and (iii) 8,831,558
Unlisted Shares (among which 72,000 Unlisted Shares will be converted to H Shares upon Listing) in which
Mr. Sun is deemed to be interested as a result of being a party acting-in-concert with Mr. Tang and Jiangfan
Technology.
(6) Jiangfan Technology is wholly-owned by Jiangcheng Asset Management, which is in turn held as to 60.0% by
Mr. Yang and 40.0% by Mr. Jiang Haisheng. By virtue of the SFO, Mr. Yang is deemed to be interested in the
Shares that Jiangfan Technology is interested in.
(7) As at the Latest Practicable Date, Shares in which Jiangfan Technology is interested consist of (i) 240,000
Unlisted Shares (among which 72,000 Unlisted Shares will be converted to H Shares upon Listing) held by it
in its own capacity; and (ii) 10,931,558 Unlisted Shares in which Jiangfan Technology is deemed to be
interested as a result of being a party acting-in-concert with Mr. Tang and Mr. Sun.
(8) For the avoidance of doubt, both Unlisted Shares and H Shares are ordinary Shares in the share capital of our
Company, and are considered as one class of Shares.
(b) Interests of the substantial shareholders in the Shares
Save as disclosed in the section headed “Substantial Shareholders” in this prospectus,
immediately following the completion of the Global Offering and the Conversion of Unlisted
Shares into H Shares and without taking into account any Shares which may be issued pursuant
to the exercise of the Over-allotment Option, our Directors are not aware of any other person
(not being a Director or chief executive of our Company) who will have an interest or short
position in the Shares or the underlying Shares which would fall to be disclosed to us and the
Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who is,
directly or indirectly, interested in 10% or more of the issued voting shares of our Company.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-32 –


--- page 720 ---
(c) Interests of the substantial shareholders of other members of our Group
The following table (together with its notes) sets out, so far as our Directors are aware,
persons who will be, directly or indirectly, interested in 10% or more of the equity interests of
our subsidiaries:
Member of our Group
(being associated
corporations)
Name of substantial
shareholder Nature of Interest
Approximate
percentage of
equity interests
held by the
substantial
shareholder
V oicecomm Yilian Shanghai Youjia Fire
Engineering Testing
Co., Ltd. (ऊ
ʮ̡)
(1)
Beneficial interest 33%
Song Xiangfei (࠭޴1) Interest in a controlled
corporation
33%
Ni Suping (९റ)(1) Interest in a controlled
corporation
33%
Yuanya Information Cuiwen Network (2) Beneficial interest 49%
Wei Yangchun (݆2) Interest in a controlled
corporation
49%
Jinxun Digital Intelligence Jinxuntong Software
Technology (3)
Beneficial interest 49%
Han Zhaoning ( ᒵ̜ྐྵ)(3) Interest in a controlled
corporation
49%
Notes:
(1) Shanghai Youjia Fire Engineering Testing Co., Ltd. (ʮ̡) is held as to 65%
by Song Xiangfei (࠭޴and 35% by Ni Suping (९റ). By virtue of the SFO, each of Song Xiangfei
(࠭޴and Ni Suping (९റ) is deemed to be interested in the equity interests of V oicecomm Yilian
that Shanghai Youjia Fire Engineering Testing Co., Ltd. is interested in.
(2) Cuiwen Network is held as to 79% by Wei Yangchun (݆By virtue of the SFO, Wei Yangchun ( ሊ
݆is deemed to be interested in the equity interests of Yuanya Information that Cuiwen Network is
interested in.
(3) Jinxuntong Software Technology is held as to 95% by Han Zhaoning ( ᒵ̜ྐྵ). By virtue of the SFO,
Han Zhaoning ( ᒵ̜ྐྵ) is deemed to be interested in the equity interests of Jinxun Digital Intelligence
that Jinxuntong Software Technology is interested in.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-33 –


--- page 721 ---
2. Particulars of Directors’ and Supervisors’ Service Contracts
We have entered into a contract with each of our Directors and Supervisors in respect of,
among other things, compliance with relevant laws and regulations, and observance of the
Articles of Association.
Save as disclosed in this prospectus, none of our Directors and Supervisors has or is
proposed to have entered into any service contract with any member of our Group (excluding
agreements expiring or determinable by any member of our Group within one year without
payment of compensation other than statutory compensation).
3. Emoluments of Directors and Supervisors
For the years 2021, 2022 and 2023, the aggregate amount of directors’ fees, salaries,
allowances and benefits in kind, discretionary bonuses, retirement scheme contributions, and
termination benefits of our Directors and Supervisors were RMB3.9 million, RMB5.2 million
and RMB5.7 million, respectively. It is estimated that under the arrangements currently in
force, the aggregate emolument payable to the Directors and Supervisors (excluding
discretionary bonus) for the year ending December 31, 2024, will be RMB5.0 million.
Our Company’s five highest paid individuals includes two, two and two Directors for each
of the years 2021, 2022 and 2023, respectively. The aggregate amount of directors’ fees,
salaries, allowances and benefits in kind, discretionary bonuses, retirement scheme
contributions, and termination benefits of five highest individuals (including Directors) for
each of the years 2021, 2022 and 2023, were RMB5.8 million, RMB7.6 million and RMB8.3
million, respectively. During the Track Record Period, no remuneration was paid by our
Company to, or receivable by, our Directors, Supervisors or the five highest paid individuals
as an inducement to join or upon joining our Company or as a compensation for loss of office
in connection with the management of the affairs of our Company or any subsidiary during the
Track Record Period.
During the Track Record Period, none of our Directors and Supervisors waived or agreed
to waive any emolument.
For details of Directors’ and Supervisors’ remunerations during the Track Record Period
as well as details of the five highest paid individuals, see notes 8 and 9 in the Accountants’
Report as set out in Appendix I to this prospectus.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-34 –


--- page 722 ---
4. Disclaimers
Save as disclosed in this prospectus:
(a) none of our Directors, Supervisors or our chief executive has any interest or short
position in the Shares, underlying Shares or debentures of us or any of our
associated corporations (within the meaning of Part XV the SFO) which will have
to be notified to us 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 us and the Stock Exchange pursuant to Model Code for Securities Transactions by
Directors of Listed Issuers once the H Shares are listed on the Stock Exchange;
(b) none of our Directors or Supervisors is aware of any person (not being a Director
or chief executive of our Company) who will, immediately following completion of
the Global Offering and the Conversion of Unlisted Shares into H Shares (without
taking into account any Shares which may be allotted and issued pursuant to the
exercise of the Over-allotment Option), have an interest or short position in the
Shares or underlying Shares which would fall to be disclosed to us under the
provisions of Divisions 2 and 3 of Part XV of the SFO or who is interested, directly
or indirectly, in 10% or more of the issued voting shares of any member of our
Group;
(c) so far as is known to our Directors, none of our Directors, Supervisors, their
respective close associates (as defined under the Listing Rules) or Shareholders who
own more than 5% of the number of issued shares of our Company have any
interests in the five largest customers or the five largest suppliers of our Group; and
(d) save as disclosed in this prospectus, none of our Directors, Supervisors or any of the
parties listed in “Qualifications of Experts” of 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;
(ii) materially interested in any contract or arrangement subsisting at the date of
this prospectus which is significant in relation to our business.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-35 –


--- page 723 ---
D. OTHER INFORMATION
1. Estate Duty
Our Directors have been advised that no material liability for estate duty is likely to fall
on our Company or any of our subsidiaries under the laws of the PRC.
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. Preliminary expenses
As of the Latest Practicable Date, our Company has not incurred any material preliminary
expenses for the purpose of the Listing Rules.
4. Promoter
Our Promoters are Mr. Tang, Mr. Sun and Mr. Shi Yerong ( ุͩᏌ). Save as disclosed in
this prospectus, within the two years preceding the date of this prospectus, no cash, securities
or other benefit has been paid, allotted or given or is proposed to be paid, allotted or given to
any Promoter in connection with the Global Offering and the related transactions described in
this prospectus.
5. Taxation of Holders of H Shares
(1) Hong Kong
The sale, purchase and transfer of H Shares registered with our Hong Kong branch
register of members will be subject to Hong Kong stamp duty. The current rate charged on each
of the purchaser and seller is 0.1% of the consideration of or, if higher, of the fair value of the
H Shares being sold or transferred.
(2) Consultation with professional advisors
Potential investors in the Global Offering are urged to consult their professional tax
advisors if they are in any doubt as to the taxation implications of subscribing for, purchasing,
holding or disposing of or dealing in our Shares (or exercising rights attached to them). None
of us, the Sole Sponsor, the Sole Overall Coordinator, the Joint Global Coordinators, the Joint
Bookrunners, the Joint Lead Managers, or any other person or party involved in the Global
Offering accept responsibility for any tax effects on, or liabilities of, any person, resulting from
the subscription, purchase, holding or disposal of, dealing in or the exercise of any rights in
relation to our Shares.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-36 –


--- page 724 ---
6. Application for Listing
The Sole Sponsor has made an application on behalf of our Company to the Listing
Committee of the Stock Exchange for the listing of, and permission to deal in, the H Shares
in issue and to be issued as mentioned in this prospectus. All necessary arrangements have been
made to enable the securities to be admitted into CCASS.
7. No Material Adverse Change
Our Directors confirmed that, up to the date of this prospectus, there has been no material
adverse change in the financial or trading position or prospect of our Group since
December 31, 2023 (being the date to which the latest audited consolidated financial
statements of our Group were prepared).
8. Qualifications of Experts
The qualifications of the experts (as defined under the Listing Rules and the Companies
(Winding Up and Miscellaneous Provisions) Ordinance) who have given their opinion and/or
advice in this prospectus are as follows:
Name Qualifications
China International Capital
Corporation Hong Kong
Securities Limited
Licensed corporation under the SFO for Type 1 (dealing
in securities), Type 2 (dealing in futures contracts),
Type 4 (advising on securities), Type 5 (advising on
futures contracts), Type 6 (advising on corporate
finance) regulated activities under the SFO
KPMG Certified Public Accountants
Public Interest Entity Auditor registered in accordance
with the Financial Reporting Council Ordinance
Jingtian & Gongcheng PRC legal advisors
Shanghai iResearch Co., Ltd. Industry consultant
As of the Latest Practicable Date, none of the experts named above had 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 any member of our
Group.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-37 –


--- page 725 ---
9. Consents
Each of the experts named in paragraph headed “– 8. Qualifications of Experts” in this
section has given and has not withdrawn their respective written consents to the issue of this
prospectus with the inclusion of their reports and/or letters and/or the references to their names
included herein in the form and context in which they are respectively included.
10. Sole Sponsor
China International Capital Corporation Hong Kong Securities Limited satisfies the
independent criteria applicable to sponsors as set out in Rule 3A.07 of the Listing Rules.
Pursuant to the engagement letter entered into between our Company and the Sole
Sponsor, we have agreed to pay the Sole Sponsor a total fee of US$1,000,000 to act as the
sponsor in connection with the proposed listing on the Stock Exchange.
11. Binding Effect
This prospectus shall have the effect, if an application is made in pursuance of it, 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.
12. Bilingual Prospectus
The English and Chinese language versions of this prospectus are being published
separately, in reliance upon the exemption provided under section 4 of the Companies
(Exemption of Companies and Prospectuses from Compliance with Provisions) Notice
(Chapter 32L of the Laws of Hong Kong).
13. Miscellaneous
Save as otherwise disclosed in this prospectus:
(a) within the two years 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, if any, is under option or is agreed
conditionally or unconditionally to be put under option;
(c) our Company has not issued nor agreed to issue any founder shares, management
shares or deferred shares;
(d) our Company has no outstanding convertible debt securities or debentures;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-38 –


--- page 726 ---
(e) within the two years immediately preceding the date of this prospectus, no
commission, discount, brokerage or other special term has been granted in
connection with the issue or sale of any capital of our Company;
(f) there is no arrangement under which future dividends are waived or agreed to be
waived;
(g) 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;
(h) our Company is not presently listed on any stock exchange or traded on any trading
system; and
(i) our Company currently does not intend to apply for the status of a sino-foreign
investment joint stock limited company and does not expect to be subject to the
Sino-Foreign Joint Venture Law of the PRC.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-39 –


--- page 727 ---
DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES
The documents attached to a copy of this prospectus and delivered to the Registrar of
Companies in Hong Kong for registration were:
(a) copies of each of the material contracts referred to in the paragraph headed “B.
Further Information about the Business of the Company – 1. Summary of Material
Contracts” in Appendix VI to this prospectus; and
(b) the written consents issued by each of the experts and referred to in paragraph
headed “D. Other information – 8. Qualifications of Experts” in Appendix VI to this
prospectus.
DOCUMENTS A V AILABLE ON DISPLAY
Copies of the following documents will be available on display on the website of the
Hong Kong Stock Exchange at www.hkexnews.hk and our website at www.voicecomm.cn
during a period of 14 days from the date of this prospectus:
(a) the Articles of Association;
(b) the Accountants’ Report of our Group for the three years ended December 31, 2021,
2022 and 2023 prepared by KPMG, the text of which is set out in Appendix I to this
prospectus;
(c) the audited consolidated financial statements of our Group for the three years ended
December 31, 2021, 2022 and 2023;
(d) the report received from KPMG on the unaudited pro forma financial information of
our Group, the text of which is set out in Appendix II to this prospectus;
(e) the industry report issued by Shanghai iResearch Co., Ltd. referred to in the section
headed “Industry Overview” in this prospectus;
(f) the PRC legal opinions issued by Jingtian & Gongcheng, our legal adviser on PRC
law, in respect of certain general corporate matters of our Group;
(g) the material contracts referred to in the paragraph headed “B. Further Information
about the Business of the Company – 1. Summary of Material Contracts” in
Appendix VI to this prospectus;
APPENDIX VII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VII-1 –


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(h) the service contracts referred to in “C. Further Information about Directors,
Supervisors and Substantial Shareholders – 2. Particulars of Directors’ and
Supervisors’ Service Contracts” in Appendix VI to this prospectus;
(i) the written consents referred to in the paragraph headed “D. Other Information – 9.
Consents” in Appendix VI to this prospectus; and
(j) the PRC Company Law, the PRC Securities Law, together with unofficial English
translations thereof.
APPENDIX VII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VII-2 –


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* For Identification Purpose Only
Sole Sponsor, Sole Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers (in alphabetical order)
Joint Lead Managers (in alphabetical order)
Joint Bookrunners and Joint Lead Managers (in alphabetical order)
GLOBAL OFFERING
(A joint stock company incorporated in the People’s Republic of China with limited liability)
Stock Code : 2495
上海聲通信息科技股份有限公司
Shanghai Voicecomm Information Technology Co., Ltd.
上海聲通信息科技股份有限公司
Shanghai Voicecomm Information Technology Co., Ltd.
