--- page 1 ---
ʮ̡
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(A joint stock company incorporated in the People’s Republic of China with limited liability)
Stock Code : 3200
GLOBAL
OFFERING
Sole Sponsor, Sponsor-Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers


--- page 2 ---
IMPORTANT : If you are in any doubt about any of the contents of this Prospectus, you should obtain professional independent advice.
SHENZHEN HAN’S CNC 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
: 50,451,800 H Shares (subject to the Over-allotment
Option)
Number of Hong Kong Offer Shares : 5,045,200 H Shares (subject to reallocation)
Number of International Offer Shares : 45,406,600 H Shares (subject to reallocation and
the Over-allotment Option)
Maximum Offer Price : HK$95.80 per H Share, plus brokerage of 1.0%,
SFC transaction levy of 0.0027%, Hong Kong
Stock Exchange trading fee of 0.00565% and
AFRC transaction levy of 0.00015% (payable in
full on application in Hong Kong dollars and
subject to refund)
Nominal value : RMB1.00 per H Share
Stock code : 3200
Sole Sponsor, Sponsor-Overall Coordinator, Joint Global Coordinator,
Joint Bookrunner and Joint Lead Manager
Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsib ility for
the contents of this Prospectus, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any lo ss howsoever arising
from or in reliance upon the whole or any part of the contents of this Prospectus.
A copy of this Prospectus, having attached thereto the documents specified in “Appendix VII — Documents Delivered to the Registrar of Companies and Av ailable on
Display” in this Prospectus, 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 of the Laws of Hong Kong). The Securities and Futures Commission of Hong Kong and the Registrar of Companies in Hong K ong take
no responsibility as to the contents of this Prospectus or any other documents referred to above.
The Offer Price is expected to be determined by agreement between the Sponsor-Overall Coordinator (on behalf of the Underwriters) and our Company on t he Price
Determination Date. The Price Determination Date is expected to be on or around Wednesday, February 4, 2026 (Hong Kong time) and, in any event, not late r than 12:00
noon on Wednesday, February 4, 2026 (Hong Kong time). The Offer Price will not be more than HK$95.80 per Offer Share unless otherwise announced. If, for any reason,
the Offer Price is not agreed by 12:00 noon on Wednesday, February 4, 2026 (Hong Kong time) between the Sponsor-Overall Coordinator (for itself and on b ehalf of the
Underwriters) and our Company, the Global Offering will not proceed and will lapse.
The Sponsor-Overall Coordinator, for itself and on behalf of the Underwriters, may, where considered appropriate and with the consent of our Company , reduce the number
of Hong Kong Offer Shares that is stated in this Prospectus at any time prior to the morning of the last day for lodging applications under the Hong Kong Pu blic Offering. In
such case, notices of the reduction in the number of Hong Kong Offer Shares will be published on the website of our Company at www.hanscnc.com and on the website of
the Hong Kong Stock Exchange at www.hkexnews.hk as soon as practicable following the decision to make such reduction, and in any event not later than the morning of
the last day for lodging applications under the Hong Kong Public Offering. For further details, see “Structure of the Global Offering” and “How to Appl y for Hong Kong
Offer Shares” in this Prospectus.
The obligations of the Hong Kong Underwriters under the Hong Kong Underwriting Agreement are subject to termination by the Sponsor-Overall Coordina tor (for itself and
on behalf of the Underwriters) if certain events occur prior to 8:00 a.m. on the Listing Date. For details, see “Underwriting” 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 off ered,
sold, pledged or otherwise transferred within the United States, except pursuant to an available exemption from, or in a transaction not subject to, t he registration
requirements of the U.S. Securities Act and in accordance with any applicable state securities laws in the United States. The Offer Shares may only be o ffered and
sold (a) in the United States to QIBs in reliance on Rule 144A or another available exemption from registration requirements under the U.S. Securities Act, and (b)
outside the United States in offshore transactions in reliance on Regulation S. No public offering of the Offer Shares will be made in the United States .
IMPORTANT
January 29, 2026


--- page 3 ---
Your application through the HK eIPO White Form service or the HKSCC EIPO channel
must be made for a minimum of 100 Hong Kong Offer Shares and in multiples of that number of
Hong Kong Offer Shares as set out in the table below. No application for any other number of
Hong Kong Offer Shares will be considered and such an application is liable to be rejected.
If you are applying through the HK eIPO White Form service, you may refer to the table
below for the amount payable for the number of H Shares you have selected. You must pay the
respective maximum amount payable on application in full upon application for Hong Kong Offer
Shares.
If you are applying through the HKSCC EIPO channel, you are required to pre-fund your
application based on the amount specified by your broker or custodian, as determined based on the
applicable laws and regulations in Hong Kong.
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
HK$ HK$ HK$ HK$
100 9,676.61 2,500 241,915.36 30,000 2,902,984.29 600,000 58,059,685.80
200 19,353.23 3,000 290,298.43 40,000 3,870,645.72 700,000 67,736,300.10
300 29,029.84 3,500 338,681.49 50,000 4,838,307.16 800,000 77,412,914.40
400 38,706.46 4,000 387,064.57 60,000 5,805,968.58 900,000 87,089,528.70
500 48,383.07 4,500 435,447.65 70,000 6,773,630.01 1,000,000 96,766,143.00
600 58,059.69 5,000 483,830.71 80,000 7,741,291.45 1,500,000 145,149,214.50
700 67,736.30 6,000 580,596.86 90,000 8,708,952.86 2,000,000 193,532,286.00
800 77,412.91 7,000 677,363.01 100,000 9,676,614.30 2,522,600
(1) 244,102,272.34
900 87,089.53 8,000 774,129.14 200,000 19,353,228.60
1,000 96,766.14 9,000 870,895.28 300,000 29,029,842.90
1,500 145,149.22 10,000 967,661.44 400,000 38,706,457.20
2,000 193,532.29 20,000 1,935,322.85 500,000 48,383,071.50
(1) Maximum number of Hong Kong Offer Shares you may apply for and this is 50% of the Hong Kong Offer Shares
initially offered.
(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) or to the HK eIPO White Form Service Provider (for applications made through the
application channel of the HK eIPO White Form service) while the SFC transaction levy, the Stock Exchange
trading fee and the AFRC transaction levy will be paid to the SFC, the Stock Exchange and the AFRC, respectively.
IMPORTANT


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If there is any change in the following expected timetable of the Hong Kong Public Offering,
we will issue an announcement on the website of the Company at www.hanscnc.com and the
website of the Stock Exchange at www.hkexnews.hk .
Hong Kong Public Offering commences ...................................9 : 0 0a . m .o n
Thursday, January 29, 2026
Latest time for completing electronic applications under the
HK eIPO White Form service through the designated
website at www.hkeipo.hk (2) .........................................1 1 : 3 0a . m .o n
Tuesday, February 3, 2026
Application lists open (3) ..............................................1 1 : 4 5a . m .o n
Tuesday, February 3, 2026
Latest time for (a) completing payment of HK eIPO White Form
applications by effecting internet banking transfer(s) or PPS
payment transfer(s) and (b) giving electronic application
instructions to HKSCC
(4) ..........................................1 2 : 0 0 noon on
Tuesday, February 3, 2026
If you are instructing your broker or custodian who is an HKSCC Participant to give
electronic application instructions via HKSCC’s FINI system to apply for the Hong Kong Offer
Shares on your behalf, you are advised to contact your broker or custodian for the latest time for
giving such instructions which may be different from the latest time as stated above.
Application lists close (3) .............................................1 2 : 0 0 noon on
Tuesday, February 3, 2026
Expected Price Determination Date (5) .........................o no rb e f o r e1 2 : 0 0 noon on
Wednesday, February 4, 2026
Announcement of the final Offer Price on the website of the
Company at www.hanscnc.com (6) and the website of the Stock
Exchange at www.hkexnews.hk o no rb e f o r e............................1 1 : 0 0p . m .o n
Thursday, February 5, 2026
EXPECTED TIMETABLE
–i–


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Announcement of the final Offer Price, the level of indications of
interest in the International Offering, the level of applications in
the Hong Kong Public Offering and the basis of allocation of
the Hong Kong Offer Shares to be published on the website of
the Company at www.hanscnc.com
and the website of the Stock
Exchange at www.hkexnews.hk ............................n ol a t e rt h a n1 1 : 0 0p . m .o n
Thursday, February 5, 2026
Results of allocations in the Hong Kong Public Offering (with successful applicants’
identification document numbers, where appropriate) to be available through a variety of channels,
including:
 in the announcement to be published on the website of the
Company at www.hanscnc.com
and the website of the
Stock Exchange at www.hkexnews.hk ..................n ol a t e rt h a n1 1 : 0 0p . m .o n
Thursday, February 5, 2026
 from the designated results of allocations website at
www.tricor.com.hk/ipo/result or
www.hkeipo.hk/IPOResult with a “search by ID”
f u n c t i o nf r o m ................................................1 1 : 0 0p . m .o n
Thursday, February 5, 2026
to 12:00 midnight on
Wednesday, February 11, 2026
 from the allocation results telephone enquiry line by
calling +852 3691 8488 between 9:00 a.m. and
6 : 0 0p . m .f r o m....................................F r i d a y , February 6, 2026 to
Wednesday, February 11, 2026
(except Saturday, Sunday and
public holidays in Hong Kong)
H Share certificates in respect of wholly or partially successful
applications pursuant to the Hong Kong Public Offering to be
dispatched or deposited into CCASS on or before
(7)(9) ........... Thursday, February 5, 2026
EXPECTED TIMETABLE
–i i–


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HK eIPO White Form e-Auto Refund payment instructions/refund
checks in respect of wholly or partially successful applications
if the final Offer Price is less than the maximum Offer Price per
Offer Share initially paid on application (if applicable) or
wholly or partially unsuccessful applications to be dispatched
on or before
(8)(9) ..........................................F r i d a y , February 6, 2026
Dealings in the H Shares on the Stock Exchange expected to
commence at 9:00 a.m. on ..................................F r i d a y , February 6, 2026
Notes:
(1) All dates and times refer to Hong Kong local dates and time, except as otherwise stated.
(2) You will not be permitted to submit your application under the HK eIPO White Form service through the
designated website at www.hkeipo.hk
after 11:30 a.m. on the last day for submitting applications. If you have
already submitted your application and obtained an application reference number from the designated website prior
to 11:30 a.m., you will be permitted to continue the application process (by completing payment of application
monies) until 12:00 noon on the last day for submitting applications, when the application lists close.
(3) If there is/are a tropical cyclone warning signal number 8 or above, a “black” rainstorm warning and/or Extreme
Conditions in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Tuesday, February 3, 2026,
the application lists will not open or close on that day. See “How to Apply for Hong Kong Offer Shares — E.
Severe Weather Arrangements.”
(4) Applicants who apply for Hong Kong Offer Shares instructing your broker or custodian to apply on your behalf
via HKSCC EIPO channel should refer to the section headed “How to Apply for Hong Kong Offer Shares — A.
Application for Hong Kong Offer Shares — 2. Application Channels.”
(5) The Price Determination Date is expected to be on or before Wednesday, February 4, 2026. If, for any reason, the
Company does not agree with the Sponsor-Overall Coordinator (for itself and on behalf of the Underwriters) on the
pricing of the Offer Shares by 12:00 noon on Wednesday, February 4, 2026, the Global Offering will not proceed
and will lapse.
(6) None of the website or any of the information contained on the website forms part of this Prospectus.
(7) No temporary document of title will be issued in respect of the Offer Shares. H Share certificates will only become
valid evidence of title at 8:00 a.m. on the Listing Date provided that the Global Offering has become unconditional
in all respects and neither of the Underwriting Agreements has been terminated in accordance with their respective
terms at or before that time. Investors who trade H Shares prior to the receipt of H Share certificates or the H
Share certificates becoming valid evidence of title do so entirely at their own risk.
EXPECTED TIMETABLE
– iii –


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(8) HK eIPO White Form e-Auto Refund payment instructions/refund checks will be issued in respect of wholly or
partially unsuccessful applications pursuant to the Hong Kong Public Offering and also in respect of wholly or
partially successful applications in the event that the final Offer Price is less than the price payable per Offer Share
on application. Part of the applicant’s identification document number, or, if the application is made by joint
applicants, part of the identification document number of the first-named applicant, provided by the applicant(s)
may be printed on the refund check, if any. Such data would also be transferred to a third party for refund
purposes. Banks may require verification of an applicant’s identification document number before encashment of
the refund check. Inaccurate completion of an applicant’s identification document number may invalidate or delay
encashment of the refund check.
(9) Applicants who have applied for Hong Kong Offer Shares through HKSCC EIPO channel should refer to the
section headed “How to Apply for Hong Kong Offer Shares — D. Despatch/Collection of H Share Certificates and
Refund of Application Monies” for details.
Applicants who have applied through the HK eIPO White Form 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 HK
eIPO White Form e-Auto Refund payment instructions. Applicants who have applied through the HK eIPO White
Form 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 check(s) in favor of the
applicant (or, in the case of joint applications, the first-named applicant) by ordinary post at their own risk.
Further information is set out in the section headed “How to Apply for Hong Kong Offer Shares — D.
Despatch/Collection of H Share Certificates and Refund of Application Monies.”
The above expected timetable is a summary only. For details of the structure of the Global
Offering, including its conditions, and the procedures for applications for Hong Kong Offer
Shares, please refer to “Structure of the Global Offering” and “How to Apply for Hong Kong Offer
Shares” respectively.
If the Global Offering does not become unconditional or is terminated in accordance with its
terms, the Global Offering will not proceed. In such a case, the Company will publish an
announcement as soon as practicable thereafter.
EXPECTED TIMETABLE
–i v–


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IMPORTANT NOTICE TO PROSPECTIVE INVESTORS
This Prospectus is issued by us 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 buy any security other than the Hong Kong Offer Shares offered by this Prospectus
pursuant to the Hong Kong Public Offering. This Prospectus may not be used for the purpose of
making, and does not constitute, an offer or invitation in any other jurisdiction or in any other
circumstances. No action has been taken to permit a public offering of the Hong Kong Offer
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. The distribution of
this Prospectus for purposes of a public offering and the offering and sale of the Hong Kong
Offer Shares in other jurisdictions are subject to restrictions and may not be made except as
permitted under the applicable securities laws of such jurisdictions pursuant to registration
with or authorization by the relevant securities regulatory authorities or an exemption
therefrom.
You should rely only on the information contained in this Prospectus to make your
investment decision. The Hong Kong Public Offering is made solely on the basis of the
information contained and the representations made in this Prospectus. 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 contained nor made in this Prospectus must
not be relied on by you as having been authorized by us, any of the Sole Sponsor , the
Sponsor-Overall Coordinator , the Overall Coordinators, the Joint Global Coordinators, the
Joint Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries, the
Underwriters, any of our or their respective directors, officers, employees, agents, or
representatives of any of them or any other parties involved in the Global Offering.
Page
Expected Timetable ..................................................... i
Contents .............................................................. v
Summary ............................................................. 1
Definitions ............................................................ 2 6
Glossary of Technical Terms .............................................. 3 8
CONTENTS
–v–


--- page 9 ---
Forward-Looking Statements ............................................. 4 1
Risk Factors ........................................................... 4 2
Waivers from Strict Compliance with the Listing Rules and Exemptions
from the Companies (Winding Up and Miscellaneous Provisions) Ordinance ..... 7 9
Information about this Prospectus and the Global Offering ..................... 9 7
Directors and Parties Involved in the Global Offering ......................... 1 0 2
Corporate Information .................................................. 1 0 8
Industry Overview ...................................................... 1 1 1
Regulatory Overview .................................................... 1 2 9
History and Corporate Structure .......................................... 1 5 1
Business .............................................................. 1 6 1
Directors and Senior Management ......................................... 2 4 9
Relationship with our Controlling Shareholders Group ........................ 2 7 4
Connected Transactions ................................................. 2 8 4
Substantial Shareholders ................................................. 2 9 9
Share Capital .......................................................... 3 0 2
Cornerstone Investors ................................................... 3 0 6
Financial Information ................................................... 3 1 8
Future Plans and Use of Proceeds ......................................... 3 9 8
Underwriting .......................................................... 4 0 6
Structure of the Global Offering .......................................... 4 1 9
CONTENTS
–v i–


--- page 10 ---
How to Apply for Hong Kong Offer Shares .................................. 4 3 0
Appendix I — Accountants’ Report ..................................... I - 1
Appendix II — Unaudited Pro Forma Financial Information ................. II-1
Appendix IIA — Profit Estimate for Year Ended December 31, 2025 ............ I I A - 1
Appendix III — Taxation and Foreign Exchange ............................ III-1
Appendix IV — Summary of Principal Laws and Regulatory Provisions ........ I V - 1
Appendix V — Summary of the Articles of Association ...................... V - 1
Appendix VI — Statutory and General Information ......................... V I - 1
Appendix VII — Documents Delivered to the Registrar of Companies
and Available on Display ............................... V II-1
CONTENTS
–v i i–


--- page 11 ---
This summary aims to give you an overview of the information contained in this
Prospectus. As this is a summary, it does not contain all the information that may be important
to you. 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 the section headed “Risk Factors.” You should read that section
carefully before you decide to invest in the Offer Shares.
OVERVIEW
We are a leading specialized PCB production equipment solution provider in China, and we
primarily engage in the R&D, production and sales of specialized PCB production equipment. Our
extensive portfolio of production equipment spans various segments of the PCB industry, and
covers various production processes, such as drilling, photolithography, lamination, formation and
testing. We operate in the specialized PCB equipment industry, such as server and data storage,
automotive electronics, mobile phones, computers and consumer electronics. Our business and
financial performance are highly dependent on the overall performance of downstream industries
that have demands for electronic devices. According to CIC, the specialized PCB equipment
industry is highly competitive and relatively fragmented, with the top five manufacturers in the
industry in China accounting for approximately 23.9% of the total market share in terms of
revenue in 2024. During the Track Record Period, vast majority of our revenue was generated from
mainland China. According to CIC, we were the China’s largest specialized PCB production
equipment manufacturer in terms of revenue in 2024, with a market share of 10.1% in China.
We have made a number of significant achievements across various business sectors:
RMB3,343.1 million
2024 Revenue
RMB299.6 million
2024 Net Proﬁt
RMB451.7 million
2024 Adjusted Net Proﬁt
(non-IFRS measure)
1,100+
(2)
registered patents
300+
(2)
software copyrights
60+
(2)
trademarks
900+
(2)
employees
in the R&D team
over 30%
(1)
 of market
share in drilling equipment
sector in China’s PCB equipment
industry
Notes:
(1) In terms of revenue from drilling equipment in China in 2024, according to CIC.
(2) As of the Latest Practicable Date.
SUMMARY
–1–


--- page 12 ---
DEVELOPMENT PHASES
We have experienced the following four development phases since our establishment:
 Start-up and diversification of business layout (2002-2012). We continuously
overcame technical bottlenecks and created an initial portfolio covering several major
PCB production processes, including drilling, photolithography, formation, and testing,
following the acquisition of Shenzhen Mason Electronics Co., Ltd. in 2008.
 Diversified comprehensive solutions (2013-2017). We actively fostered close
cooperative relationships with our customers, and enriched our product portfolio with a
full range of products, such as mechanical drilling equipment, thus forming a more
comprehensive product matrix.
 Product Portfolio and technology expansion (2018-2021). We focused on growing our
customer base with more products and technologies, entered major global PCB supply
chains, and developed packaging substrates processing equipment and new laser
processing technologies.
 Product enhancement since listing (2022-present). Listed on the Shenzhen Stock
Exchange’s ChiNext Market in 2022, we achieved innovation in equipment design and
production technologies, such as the single-table double-station operation system, new
laser processing technology and packaging substrate solutions. We further expanded our
presence in Southeast Asian countries, such as Thailand. We launched PCB lamination
equipment in 2024, further enriching our product portfolio to to cover nearly all major
PCB production processes.
OUR PRODUCTS
Our extensive portfolio of production equipment spans various segments of the PCB industry,
and covers various production processes, such as drilling, photolithography, lamination, formation
and testing. Benefiting from our extensive product portfolio, advanced technologies and strong
production capabilities, we are able to adapt quickly to the evolving industry trends and serve our
customers’ diverse needs. During the Track Record Period, we sold our specialized PCB
production equipment to over 10 countries and regions.
SUMMARY
–2–


--- page 13 ---
The following table sets forth the details of the revenue, sales volume and average selling price (net of tax) of our products by PCB
production process for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Revenue
Sales
Volume
Average
Selling
Price Revenue
Sales
Volume
Average
Selling
Price Revenue
Sales
Volume
Average
Selling
Price Revenue
Sales
Volume
Average
Selling
Price Revenue
Sales
Volume
Average
Selling
Price
RMB’000 Unit RMB’000/Unit RMB’000 Unit RMB’000/Unit RMB’000 Unit RMB’000/Unit RMB’000 Unit RMB’000/Unit RMB’000 Unit RMB’000/Unit
(unaudited)
Drilling equipment .......... 1,666,776 2,514 663 818,051 1,129 725 2,100,645 3,119 674 1,619,065 2,569 630 3,095,604 4,499 688
Photolithography equipment ..... 403,646 132 3,058 189,155 79 2,394 340,306 141 2,414 288,061 119 2,421 247,547 103 2,403
Testing equipment .......... 284,312 519 548 197,561 400 494 274,139 446 615 219,857 359 612 383,632 501 766
Formation equipment ......... 214,864 463 464 152,323 289 527 254,138 596 426 200,959 477 421 237,581 521 456
Attachment equipment ........ 23,603 74 319 54,778 183 299 81,940 206 398 64,796 168 386 95,437 208 459
Lamination equipment ........ —————— 9,804 2 4,902 4,760 1 4,760 — — —
Total/Overall ............ 2,593,201 3,702 701 1,411,868 2,080 679 3,060,972 4,510 679 2,397,498 3,693 649 4,059,801 5,832 696
SUMMARY
–3–


--- page 14 ---
The following chart sets forth our key products and the roles they play along the major PCB
production processes:
Incoming Material
Photolithography
(Inner Layer)
Testing
(Outer Layer Etching)
Photolithography
(Solder Mask & Legend)
Drilling
Electroplating
Photolithography
(Outer Layer)
Lamination
/g132Laser Direct Imaging (LDI) System
/g132Developing-Etching-Stripping (DES)
Equipment
/g132Automated Optical Inspection(AOI)
Equipment
/g132Brown Oxide Line
/g132Cold/Hot Press Machine
/g132X-Ray Drilling Target Alignment
System
Laser Drilling Machine
Mechanical Drilling Machine
Drill Bit Grinder Equipment
/g132Plated Through Hole (PTH)
Deposition Line
/g132Vertical Continuous Plating (VCP)
Line
/g132LDI System
/g132Curing Oven Line
/g132Legend Inkjet Printer
/g132Etching-Stripping Line
/g132Stripping-Etching-Tin Stripping Lin
/g132AOI Equipment
/g132Dry Film Laminator
/g132LDI System
/g132Developing Line
Our Business
CoverageNote: The related manufacturing
equipment
Formation
 Testing
(Final Quality )
Attachment
(Packaging and Attachment)
/g132Mechanical formation machine
/g132VCUT Beveling Machine
/g132Automated Sorting & Packaging
System
/g132Attachment equipment
/g132
/g132
/g132
Electrical Test Equipment
Automated Visual Inspection (AVI)
Equipment
/g132
/g132
Drilling Equipment and Solutions
The drilling process is a mission-critical stage in PCB production, enabling the creation of
conductive vias that realize interlayer electrical connectivity in multi-layer board architectures.
Aligning with industry standards, we provide both mechanical drilling equipment and laser direct
drilling systems to meet different processing requirements. In 2022, 2023, 2024 and the ten months
ended October 31, 2024 and 2025, we sold 2,514, 1,129, 3,119, 2,569 and 4,499 units of drilling
equipment, representing a sales-production ratio of 121.1%, 81.6%, 108.9%, 114.2% and 98.9%,
respectively. The sales-production ratio is calculated as sales volume divided by production
volume and multiplied by 100%. We primarily adopt a market-driven production model, and
formulate a MPS on a monthly basis, taking into account demand forecasting, purchase intentions,
confirmed orders, inventory positioning, and capacity utilization.
Photolithography Equipment and Solutions
The photolithography process involves transferring the designed circuit patterns onto the PCB
substrate. We primarily provide customers with LDI equipment covering inner layer patterns, outer
layer patterns, and solder mask patterns. LDI utilizes a fully digital production model, eliminating
multiple steps of the traditional process and avoiding quality issues associated with film materials.
Our LDI equipment helps improve production efficiency and patterning accuracy, particularly for
SUMMARY
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high-density designs. In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025,
we sold 132, 79, 141, 119 and 103 units of photolithography equipment, representing a
sales-production ratio of 109.1%, 97.5%, 110.2%, 114.4% and 93.6%, respectively.
Testing Equipment and Solutions
The testing process is crucial in PCB production, as it ensures both the functional reliability
and structural integrity of end products. Our equipment and solutions cover a diverse range of
electrical testing equipment to assess whether the PCBs’ electrical performance meets design
requirements, along with automated optical inspection system to evaluate product integrity and
identify defects like open circuits, shorts, foreign objects, and scratches. Our LDI equipment helps
improve production efficiency and patterning accuracy, particularly for high-density designs. Our
testing equipment and solutions support automated testing and inspection to help improve product
quality and production efficiency. In 2022, 2023, 2024 and the ten months ended October 31, 2024
and 2025, we sold 519, 400, 446, 359 and 501 units, respectively, of testing equipment,
representing a sales-production ratio of 101.8%, 93.2%, 80.9%, 88.2% and 93.1%, respectively.
Formation Equipment and Solutions
The formation process involves using milling or laser techniques to remove excess edges or
create internal cut-outs in PCBs, shaping them to the required specifications and dimensions.
Typically, rigid boards are processed using mechanical milling, while laser technology is employed
for ultra-thin rigid boards, FPC, and rigid-flex boards with high precision requirements. We
provide precision solutions for PCB shaping across rigid and flexible architectures. Our formation
equipment and solutions meet different processing requirements for rigid boards, FPC and
rigid-flex boards. In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, we
sold 463, 289, 596, 477 and 521 units of formation equipment, representing a sales-production
ratio of 112.1%, 87.8%, 106.4%, 110.2% and 108.3%, respectively.
Attachment Equipment and Solutions
The attachment process is tailored to the characteristics of FPC and rigid-flex boards,
utilizing a micro-adhesive tape roll feeding structure and heating platform to bond various
materials such as steel sheets and cover films. We offer comprehensive attachment solutions for
FPC and rigid-flex boards, cover films, electromagnetic shielding films, adhesive tapes, among
others. Our attachment equipment supports automated attachment and inspection to help ensure
product quality and meet the requirements of different application scenarios. In 2022, 2023, 2024
and the ten months ended October 31, 2024 and 2025, we sold 74, 183, 206, 168 and 208 units of
attachment equipment, representing a sales-production ratio of 84.1%, 101.7%, 101.0%, 94.9% and
80.3%, respectively.
SUMMARY
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Lamination Equipment and Solutions
The lamination process involves bonding multiple double-sided or HDI core panels using PP
and copper foil to form multi-layer PCBs. Traditional multi-layer boards with four or more layers
are laminated in a single process, while HDI products require multiple laminations depending on
the number of stacked blind vias. Lamination quality is important to subsequent manufacturing
processes and overall product performance. In 2024, we launched and sold two units of lamination
equipment, representing a sales-production ratio of 50%.
See “Business — Our Products.”
OUR STRENGTHS
 We achieved broad customer recognition in the specialized PCB production equipment
industry;
 We are a key infrastructure provider in the upstream of the AI server and intelligent
electric vehicle industry value chain;
 Our platform-based technologies and diverse product portfolio enable multi-dimensional
business synergy;
 We have established strong R&D capabilities which drive technological advancement in
the PCB industry of China and enhance our competitiveness in the global market
through innovative technologies;
 Our customer base covers a majority of leading PCB manufacturers in mainland China,
collaboratively leading industry development; and
 We have an excellent management team and a comprehensive talent development
mechanism.
OUR STRATEGIES
 We plan to anchor our strategy in emerging sectors such as AI and intelligent NEVs,
collaborating closely with end-customers through joint R&D laboratories and full-chain
support from process validation to mass production;
 We plan to expand our global business presence;
 We plan to further enhance our R&D capabilities on key technologies, optimizing
production processes in the multilayer board sector and expanding to the advanced
packaging sector; and
 We plan to build a full lifecycle service system to enhance customer loyalty and
industry influence.
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RESEARCH AND DEVELOPMENT
We are dedicated to technological innovation, which is crucial in advancing our capabilities
and delivering value to our customers, while also driving our sales and profitability. With over 20
years of operational experience, we have amassed significant production expertise in high-speed
and high-precision motion control, precision machinery, electrical engineering, software
algorithms, advanced optical systems, laser technology, image processing and electronic testing.
Our R&D team comprises experts in high-speed motion control, laser technology applications and
software algorithms. As of October 31, 2025, we had a total of 871 R&D employees, accounting
for 27.3% of our total workforce. Among these 871 R&D employees, 74.5% hold a bachelor’s
degree or above.
We have established the Han’s CNC Microelectronics research center specializing in laser
processing equipment for package substrates with patented processes for high-quality scum-free
results. We have also invested in multiple product centers responsible for product development. In
response to the trend of further specialization in the specialized PCB equipment industry, we
established the Lamination Product Center, the Coating Tool Product Center and the Optical
Inspection Product Center in 2023 to supplement and strengthen our product R&D in the relevant
fields.
OUR PRODUCTION
We primarily adopt a market-driven production model. Our integrated supply chain and
delivery platform formulates a MPS on a monthly basis, synthesizing demand forecasting, purchase
intentions, confirmed orders, inventory positioning, and capacity utilization.
As of the Latest Practicable Date, we had two production bases in China. Our Shenzhen
production base spanned a GFA of approximately 118,266.0 sq.m. and encompassed two
production plants, namely, the Shajing Antuo Hill Production Plant ( Ӎʜτϖʆ͛ପʈᅀ ) and the
Fuyong Han’ Laser Manufacturing Center Production Plant ( ၅͑ɽૄዧΈ౽ிʕː͛ପʈᅀ )a s
of October 31, 2025. Our Xinfeng production base, located in Jiangxi Province, China, spanned a
GFA of approximately 38,830.0 sq.m. and encompassed two production plants namely, Xinfeng
CNC Production Plant (Ҧ (ᔮ)ʮ̡͛ପʈᅀ ) and Mason Electronics (Xinfeng)
Production Plant ( ௥Ⴥཥɿ(ᔮ)ʮ̡͛ପʈᅀ ), equipped with advanced production
facilities as of October 31, 2025. During the Track Record Period, the sales-production ratio for
most of our products exceeded 100%, reflecting our adoption of a flexible and demand-driven
production architecture, which serves as a core competitive strength in meeting evolving market
demands.
SUMMARY
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We maintain limited reliance on specialized heavy equipment, with primary production
processes centered around precision assembly, calibration, and integration of mechanical,
electrical, and optical components. This operational structure enables agile production facilities
reconfiguration without incurring substantial retooling expenses or facility modification costs.
CUSTOMERS, SALES AND MARKETING
Our Customers and Customer Service
During the Track Record Period, our customers were mainly PCB manufacturers in China,
while a small proportion of our customers were distributors. Revenue from sales to our top five
customers in each year or period during the Track Record Period in aggregate accounted for
36.4%, 25.0%, 22.6% and 32.5% of our total revenue, respectively, in the same periods. Revenue
from sales to our largest customer in each year or period during the Track Record Period
accounted for 12.6%, 7.5%, 5.7% and 19.7% of our total revenue, respectively, in the same years
or periods.
Our Sales Network
During the Track Record Period, we established an extensive sales network that allows us to
bring our products to a broad customer base, bolstering our brand reputation and reinforcing our
competitive edge in the market. During the Track Record Period, we entered into sales and
purchase agreements with our direct customers, and also sold our products through distributors,
who in turn sell our products to other companies. As of October 31, 2025, we had established four
overseas subsidiaries and maintained three distributors, through which our products have been sold
to more than 10 countries and regions.
The following table sets forth a breakdown of our revenue by geographic region, based on the
locations of our customers, for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Mainland China .......... 2,749,760 98.7 1,549,406 94.8 2,981,171 89.2 2,322,285 88.5 3,761,835 87.2
Overseas (1) ............ 36,390 1.3 84,905 5.2 361,920 10.8 301,597 11.5 552,311 12.8
Total ............... 2,786,150 100.0 1,634,311 100.0 3,343,091 100.0 2,623,882 100.0 4,314,146 100.0
Note:
(1) Primarily include Thailand, Taiwan China and Malaysia.
SUMMARY
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The following table sets forth a breakdown of our revenue by contribution from our
customers for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except percentages)
(unaudited)
Direct customers (1) ......... 2,764,944 99.2 1,619,318 99.1 3,316,306 99.2 2,603,270 99.2 4,276,472 99.1
Distributorship ........... 21,206 0.8 14,993 0.9 26,785 0.8 20,612 0.8 37,674 0.9
Total ............... 2,786,150 100.0 1,634,311 100.0 3,343,091 100.0 2,623,882 100.0 4,314,146 100.0
Note:
(1) Direct customers refer to the end users of our products or services, engaging with us directly by themselves or
through sales agents.
SUPPLY CHAIN MANAGEMENT
Raw Materials and Procurement
The key raw materials we procure include sheet metal and machined parts, mechanical
devices, purchased modules and optical devices. We primarily procure raw materials in China.
Potential pricing fluctuations in our raw materials can arise due to factors including global and
domestic economic conditions, governmental regulations, supply-demand dynamics and
geopolitical conditions. While our bargaining power for certain materials might be restricted to a
certain extent due to these factors beyond our control, our ability to procure sufficient supplies
remains steadfast. In procuring raw materials from suppliers, we generally adopt a one-time
pricing model, under which the price is fixed for each purchase agreement or purchase order,
thereby providing certainty for both parties.
The raw materials we procure are primarily precision-processed products, the prices of which
have historically exhibited low volatility. As a result, overall fluctuations in raw material prices
have not had a material impact on our results of operations. For certain materials, such as lasers,
we may adjust our quotations to reflect any corresponding cost increases. As a result, we are
generally able to pass on the increases in raw material costs to our customers.
During the Track Record Period and up to the Latest Practicable Date, we did not experience
any significant shortage of raw materials supplies, and the raw materials provided by our suppliers
did not have any significant quality issues.
SUMMARY
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Our Suppliers
During the Track Record Period, our major suppliers primarily include manufacturers of
modules, optical devices, control electronics, mechanical devices, sheet metal and machined parts.
Purchases from our top five suppliers in each year/period during the Track Record Period in
aggregate accounted for 26.7%, 18.9%, 25.1% and 30.1% of our total purchases, respectively, and
purchases from our largest supplier in each year/period during the Track Record Period accounted
for 9.2%, 8.6%, 9.2% and 13.3% of our total purchases, respectively.
COMPETITION
According to CIC, the specialized PCB equipment industry is highly competitive and
relatively fragmented, with the top five manufacturers in the industry in China accounting for
approximately 23.9% of the total market share in terms of revenue in 2024. According to CIC, we
were the China’s largest specialized PCB production equipment manufacturer in terms of revenue
in 2024, with a market share of 10.1% in China. We believe that our competitive position is
underpinned by our strengths, including our market position, exceptional R&D capabilities and
technologies, production capacity and supply management expertise, quality and stable customer
base, and experienced management team. We believe that there are high barriers for our
competitors to enter into the market, which include, among other things, technology, scale
production experience, capital investment, supply chain and customer base. See “Industry
Overview.”
SUMMARY
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SUMMARY OF HISTORICAL FINANCIAL INFORMATION
The following tables present our summary of consolidated financial data derived from our
consolidated statements of profit or loss, consolidated statements of financial position and
consolidated statements of cash flows for the years ended December 31, 2022, 2023, 2024 and the
ten months ended October 31, 2024 and 2025, included in the Accountants’ Report in Appendix I
to this Prospectus. The following data and discussion should be read in conjunction with our
consolidated financial statements and related notes and the section headed “Financial Information.”
Summary of Consolidated Statements of Profit or Loss
The following table sets forth a summary of our consolidated statements of profit or loss for
the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage of revenue)
(unaudited)
Revenue .............. 2,786,150 100.0 1,634,311 100.0 3,343,091 100.0 2,623,882 100.0 4,314,146 100.0
Cost of sales ............ (1,838,332) (66.0) (1,157,425) (70.8) (2,435,421) (72.8) (1,935,634) (73.8) (2,971,290) (68.9)
Gross profit ........... 947,818 34.0 476,886 29.2 907,670 27.2 688,248 26.2 1,342,856 31.1
Other income and gains, net ..... 184,681 6.6 127,799 7.8 192,013 5.7 89,257 3.4 131,358 3.0
Selling and marketing expenses ... (160,527) (5.8) (132,209) (8.1) (196,103) (5.9) (160,668) (6.1) (235,830) (5.5)
Administrative expenses ...... (153,653) (5.5) (112,515) (6.9) (203,743) (6.1) (154,874) (5.9) (218,396) (5.1)
Research and development expenses . (229,671) (8.2) (193,564) (11.8) (266,829) (8.0) (200,660) (7.6) (299,957) (7.0)
Impairment losses on financial assets
and contract assets under expected
credit loss model (“ ECL”), net .. (22,780) (0.8) (17,397) (1.1) (23,355) (0.7) (29,575) (1.1) (26,209) (0.6)
Other expenses ........... (3,977) (0.1) (10,621) (0.6) (83,175) (2.5) (5,457) (0.2) (96,009) (2.2)
Finance costs ........... (16,976) (0.6) (6,638) (0.4) (10,061) (0.3) (9,088) (0.3) (13,470) (0.3)
Impairment of an investment in an
associate ............. (55,768) (2.0) ————————
Share of profits and losses of
associates ............ (5,825) (0.2) 5,685 0.3 13,166 0.4 4,901 0.2 5,573 0.1
Profit before tax ......... 483,322 17.3 137,426 8.4 329,583 9.9 222,084 8.5 589,916 13.7
Income tax expense ......... (51,310) (1.8) (1,758) (0.1) (30,001) (0.9) (10,109) (0.4) (70,997) (1.6)
Profit for the year/period ..... 432,012 15.5 135,668 8.3 299,582 9.0 211,975 8.1 518,919 12.0
SUMMARY
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Non-IFRS Measure
To supplement our consolidated financial statements, which are presented in accordance with
IFRS Accounting Standards, we also use adjusted net profit (non-IFRS measure) as an additional
financial measure, which is not required by, or presented in accordance with IFRS Accounting
Standards. We believe this non-IFRS measure facilitates comparisons of operating performance
from year to year and period to period, as well as company to company by eliminating potential
impacts of certain items. We believe this measure provides useful information to investors and
others in understanding and evaluating our results of operations in the same manner as they help
our management. However, such non-IFRS measure we presented may not be directly comparable
to similar measures presented by other companies. The use of this non-IFRS measure should not
be considered as a substitute for analysis of our results of operations or financial condition as
reported under IFRS Accounting Standards. In addition, the non-IFRS measure may be defined
differently from similar terms used by other companies, and may not be comparable to other
similarly titled measures used by other companies.
We define adjusted net profit (non-IFRS measure) as profit for the year/period adjusted by
adding back/subtracting share-based payment compensation and adding back listing expenses. The
following table reconciles our adjusted net profit (non-IFRS measure) presented in accordance with
IFRS Accounting Standards, which is profit for the year/period.
Year Ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Profit for the year/period ......... 432,012 135,668 299,582 211,975 518,919
Adjusted by:
— Share-based payment
compensation (1) ............. (10,260) 12,736 152,071 127,357 82,092
— Listing expenses (2) .......... ———— 1 , 1 4 3
Adjusted net profit (non-IFRS
measure) ................... 421,752 148,404 451,653 339,332 602,154
Notes:
(1) Share-based payment compensation is non-cash in nature and represent the arrangement under which we receive
services from employees as consideration for our equity instruments. Share-based payment compensation is not
expected to result in future cash payments.
(2) Listing expenses represent expenses incurred in connection with the Global Offering.
SUMMARY
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Our net profit increase by 144.8% from RMB212.0 million in the ten months ended October
31, 2024 to RMB518.9 million in the ten months ended October 31, 2025 primarily due to (i) the
increase in our revenue by 64.4% from RMB2,623.9 million in the ten months ended October 31,
2024 to RMB4,314.1 million in the ten months ended October 31, 2025, which was mainly
attributable to (a) the surge in demand for IT infrastructure in the AI industry chain; and (b) the
recovery of the consumer electronics sector and the technological upgrade of automotive
electronics; and (ii) an increase in our gross profit margin from 26.2% in the ten months ended
October 31, 2024 to 31.1% in the ten months ended October 31, 2025, which was primarily due to
an increase in the gross profit margin of our drilling equipment, as a result of an increase in the
proportion of sales of our high-precision drilling equipment, which carries a relatively higher gross
profit margin.
Our net profit increased by 120.8% from RMB135.7 million in 2023 to RMB299.6 million in
2024, primarily due to the increase in our revenue by 104.6% from RMB1,634.3 million in 2023 to
RMB3,343.1 million in 2024, which was mainly attributable to an increase in demand for our
specialized PCB production equipment driven by (i) the surge in demand for IT infrastructure in
the AI industry chain; and (ii) the recovery of the consumer electronics sector and the
technological upgrade of automotive electronics.
Our net profit decreased by 68.6% from RMB432.0 million in 2022 to RMB135.7 million in
2023, primarily due to (i) the decrease in our revenue by 41.3% from RMB2,786.2 million in 2022
to RMB1,634.3 million in 2023, which was mainly attributable to a decline in the industry in
which we operate and in various downstream sectors, as reflected by (a) a decrease in the overall
market demand for specialized PCB equipment in China from approximately US$3.9 billion in
2022 to approximately US$3.7 billion in 2023, and (b) a decline in industry output value of
various sectors downstream of PCB equipment, such as servers and data storage, automotive
electronics, mobile phones, computers, and consumer electronics, among others, from
approximately US$81.7 billion in 2022 to approximately US$69.5 billion in 2023, which in turn
led to a decrease in demand for PCBs and related upstream equipment; and (ii) the decrease in our
gross profit margin from 34.0% in 2022 to 29.2% in 2023, which was mainly attributable to the
decrease in the gross profit margin of our drilling equipment. The average selling price of our
specialized PCB equipment fell from RMB700.5 thousand in 2022 to RMB678.8 thousand in 2023,
mainly due to shifts in product mix and competitive pricing, partially offset by higher prices for
laser drilling and formation equipment.
SUMMARY
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Summary of Consolidated Statements of Financial Position
The following table sets forth a summary of our consolidated statements of financial position
as of the dates indicated:
As of December 31, As of October 31,
2022 2023 2024 2025
(RMB in thousands)
Total non-current assets .............. 1,077,201 1,334,424 1,993,002 2,373,325
Total current assets ................. 6,074,607 4,644,703 5,193,495 7,195,361
Total assets ...................... 7,151,808 5,979,127 7,186,497 9,568,686
Total non-current liabilities ............ 104,073 54,975 237,522 219,297
Total current liabilities ............... 1,317,023 1,235,607 1,812,598 3,665,097
Total liabilities .................... 1,421,096 1,290,582 2,050,120 3,884,394
Net current assets ................. 4,757,584 3,409,096 3,380,897 3,530,264
Total equity ...................... 5,730,712 4,688,545 5,136,377 5,684,292
Our net current assets increase from RMB3,380.9 million as of December 31, 2024 to
RMB3,530.3 million as of October 31, 2025, primarily due to an increase in trade and bills
receivables, inventories and prepayments, other receivables and other assets primarily driven by
our increased sales in the ten months ended October 31, 2025, partially offset by (i) an increase in
trade and bills payables and other payables and accruals driven by an increase in procurement to
respond to increased sales and by our expanded business scale; (ii) an increase in interest-bearing
borrowings which served as flexible sources for our enhanced raw material procurement in
response to market demand; and (iii) a decrease in cash and cash equivalents.
Our net current assets decreased from RMB3,409.1 million as of December 31, 2023 to
RMB3,380.9 million as of December 31, 2024, primarily due to (i) an increase in trade and bills
payables of RMB683.6 million which was mainly attributable to (a) an increased demand for our
products, resulting in the increase of trade payables, and (b) the issuance of more bills to settle
payments with suppliers in an effort to improve liquidity management; (ii) a decrease in cash and
cash equivalents of RMB377.8 million which was mainly attributable to our net cash flows used in
investing activities resulting from (a) purchases of items of property, plant and equipment, other
intangible assets and other non-current assets, and (b) an increase in time deposits; and (iii) a
decrease in inventories of RMB73.9 million, which was mainly attributable to the increased
turnover and improved efficiency in inventory management, partially offset by an increase in trade
and bills receivables of RMB981.4 million, which was mainly attributable to an increase in sales
SUMMARY
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resulting from the surge in demand for IT infrastructure in the AI industry chain, coupled with the
recovery of the consumer electronics sector and the technological upgrade of automotive
electronics.
Our net current assets decreased from RMB4,757.6 million as of December 31, 2022 to
RMB3,409.1 million as of December 31, 2023, primarily due to (i) a decrease of RMB1,069.6
million in cash and cash equivalents which was mainly attributable to our net cash flows used in
financing activities resulting from dividends paid; and (ii) a decrease of RMB454.3 million in
trade and bills receivables which was mainly attributable to a decrease in sales, partially offset by
a decrease of RMB122.9 million in other payables and accruals, which was mainly attributable to a
decrease in accruals of payroll and welfare payables resulting from a reduction in
performance-based compensation accrued in 2023 due to our declined financial performance in
2023.
Our net assets increased from RMB5,136.4 million as of December 31, 2024 to RMB5,684.3
million as of October 31, 2025, primarily due to (i) profit for the period of RMB518.9 million; and
(ii) share-based payment compensation of RMB82.1 million.
Our net assets increased from RMB4,688.5 million as of December 31, 2023 to RMB5,136.4
million as of December 31, 2024, primarily due to (i) profit for the year of RMB299.6 million; and
(ii) share-based payment compensation attributable to share-based payment reserve of RMB152.1
million.
Our net assets decreased from RMB5,730.7 million as of December 31, 2022 to RMB4,688.5
million as of December 31, 2023, primarily due to dividends declared attributable to retained
profits of RMB1,197.0 million, which was partially offset by profit for the year of RMB135.7
million.
SUMMARY
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Summary of Consolidated Statements of Cash Flows
The following table sets forth a summary of our cash flows for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Net cash generated from/(used) operating
activities ...................... 655,354 416,774 154,986 (123,311) (754,356)
Net cash used in investing activities ...... (145,763) (310,938) (623,967) (595,128) (111,583)
Net cash from/(used in) financing activities .. 2,256,554 (1,174,846) 93,786 (63,030) 473,845
Cash and cash equivalents at beginning of
year/period .................... 219,259 2,986,535 1,916,965 1,916,965 1,539,131
Effect of foreign exchange rate changes, net . 1,131 (560) (2,639) (2,074) (693)
Cash and cash equivalents at end of
year/period .................... 2,986,535 1,916,965 1,539,131 1,133,402 1,146,344
In the ten months ended October 31, 2025, our net cash flows used in operating activities was
RMB754.4 million. Our net cash used in operating activities is calculated by adjusting our profit
before tax of RMB589.9 million by non-cash and other items to arrive at an operating profit before
working capital changes of RMB855.1 million. Our movements in working capital primarily reflect
(i) an increase in trade and bills receivables of RMB2,774.8 million and (ii) an increase in
inventories of RMB860.9 million, partially offset by (i) an increase in trade and bills payables of
RMB1,771.6 million and (ii) an increase in other payables and accruals of RMB293.7 million.
We recorded operating cash outflow for the ten months ended October 31, 2025, primarily
due to (i) a timing mismatch between cash inflows from sales and cash outflows for purchases; and
(ii) higher performance-based remuneration and an increase in headcount, which further increased
cash outflows related to employee compensation.
To improve the net cash outflow position as of October 31, 2025, we continued to implement
liquidity measures, such as steady cash flow operations and budgeting, collaborating with sales
department, adopting rolling budgets, and following up on customer payments. Further, we
increased the proportion of prepayments to secure earlier cash inflows and reduce reliance on
extended installment settlements, which typically delay cash collection. For example, with regards
to certain types of our equipment products designed for AI servers, we initially offered credit
periods ranging from 12 to 20 months upon launch. As we further upgraded our products and
improved their competitiveness, and taking into account market competitive landscape, we actively
negotiated with customers and were able to bargain for shortened credit periods ranging from
approximately three to 12 months, with the specific credit period for each customer determined
SUMMARY
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after careful analysis of each customer’s creditworthiness and historical credit records. We believe
such significant operating cash outflow in the ten months ended October 31, 2025 is temporary,
and that the above measures will lead to improvements in our operating cash flow position for the
full year of 2025.
We experienced similar operating cash outflow in the ten months ended October 31, 2024 as
well, because in 2024, we experienced a significant increase in sales revenue, which in turn
required us to expand our procurement scale to meet such increase in demand, resulting in a
significant increase in payments to suppliers. In the ten months ended October 31, 2024, our trade
receivable turnover days reached 240 days, and we experienced net cash used in operating
activities of RMB123.3 million.
To reduce such turnover days and improve operating cash flow position, we focused on the
following, which we also continued to implement and improve in 2025:
 maintaining steady cash flow operations and budgeting by enhancing cash flow
forecasting and payment scheduling with an aim to optimize payment timing and
maintain a balance between cash payments and the need to support essential operational
expenditure and procurement;
 collaborating with the sales department to set collection targets;
 adopting quarterly rolling budgets, and conducting reviews and analyses on variances
between budgeted and actual figures to identify underlying reasons; and
 following up on customer payments in a timely manner, including implementing targeted
collection strategies, particularly for customers with longer outstanding receivables.
We also enhanced collection efforts in the last two months of 2024, adopted bank acceptance
bills to optimize the procurement payment cycle, and incentivized our sales personnel to expedite
cash collection. As a result of the above measures our trade receivable turnover days improved
from 240 days in the ten months ended October 31, 2024 to 228 days for the year ended December
31, 2024. Benefitting from the above measures, our net operating cash outflow of RMB123.3
million in the ten months ended October 31, 2024 reverted to a net operating cash inflow of
RMB155.0 million in the full year of 2024.
SUMMARY
–1 7–


--- page 28 ---
In 2024, our net cash flows from operating activities was RMB155.0 million. Our net cash
from operating activities is calculated by adjusting our profit before tax of RMB329.6 million by
non-cash and other items to arrive at an operating profit before working capital changes of
RMB603.9 million. Our movements in working capital primarily reflect (i) an increase in trade and
bills payables of RMB1,361.7 million and (ii) a decrease in inventories of RMB11.5 million,
partially offset by an increase in trade and bills receivables of RMB1,813.7 million. Our net
operating cash outflow position in the ten months ended October 31, 2024 turned into a net
operating cash inflow position in the full year of 2024 due to the above measures on cash flow
operations and budgeting, collaborating with sales department and other measures to expedite cash
collection.
In 2023, our net cash flows from operating activities was RMB416.8 million. Our net cash
from operating activities is calculated by adjusting our profit before tax of RMB137.4 million by
non-cash and other items to arrive at an operating profit before working capital changes of
RMB247.4 million. Our movements in working capital primarily reflect (i) an increase in trade and
bills payables of RMB309.7 million and (ii) a decrease in trade and bills receivables of RMB119.0
million, partially offset by (i) a decrease in other payables and accruals of RMB135.5 million and
(ii) an increase in inventories of RMB116.1 million.
In 2022, our net cash flows from operating activities was RMB655.4 million. Our net cash
from operating activities is calculated by adjusting our profit before tax of RMB483.3 million by
non-cash and other items to arrive at an operating profit before working capital changes of
RMB633.3 million. Our movements in working capital primarily reflect (i) a decrease in
inventories of RMB271.1 million and (ii) an increase in trade and bills payables of RMB217.0
million, partially offset by a decrease in other payables and accruals of RMB227.5 million.
SUMMARY
–1 8–


--- page 29 ---
KEY FINANCIAL RATIOS
The following table sets forth our key financial ratios as of the dates or for the years/periods
indicated:
As of/Year ended
December 31,
As of/Ten months ended
October 31,
2022 2023 2024 2024 2025
(unaudited)
Current ratio (times) (1)............... 4.6 3.8 2.9 — 2.0
Quick ratio (times) (2) ............... 3.9 3.0 2.4 — 1.5
Gearing ratio (%)(3) ................ 19.9 21.6 28.5 — 40.6
Return on equity (%)(4) .............. 10.7 2.6 6.1 4.4 9.6
Gross profit margin (%) (5) ............ 34.0 29.2 27.2 26.2 31.1
Net profit margin (%) (6) .............. 15.5 8.3 9.0 8.1 12.0
Notes:
(1) Current ratio equals current assets divided by current liabilities as of the same date.
(2) Quick ratio equals current assets minus inventories divided by current liabilities as of the same date.
(3) Gearing ratio equals total liabilities divided by total assets as of the same date and multiplied by 100%.
(4) Return on equity equals profit for the year/period after tax attributable to owners of the parent divided by average
total equity attributable to owners of the parent and multiplied by 100%.
(5) Gross profit margin equals gross profit divided by revenue for the year/period.
(6) Net profit margin equals profit divided by revenue for the year/period.
Our gearing ratio increased from 19.9% as of December 31, 2022 to 21.6% as of December
31, 2023, primarily due to the decrease in total assets. Our gearing ratio increased from 21.6% as
of December 31, 2023 to 28.5% as of December 31, 2024, primarily due to the increase in total
liabilities. Our gearing ratio increase from 28.5% as of December 31, 2024 to 40.6% as of October
31, 2025, primarily due to a faster increase in total liabilities.
SUMMARY
–1 9–


--- page 30 ---
OFFERING STATISTICS
The statistics in the following table are based on the assumptions that (i) the Global Offering
has been completed and 50,451,800 H Shares are issued pursuant to the Global Offering, (ii) the
Over-allotment Option is not exercised, and (iii) 475,960,952 Shares are issued and outstanding
immediately following the completion of the Global Offering.
Based on the maximum Offer
Price of HK$95.80 per H Share
Market capitalization of our H shares (1) ................................ HK$4,833.28 million
Market capitalization of our Shares (2) .................................. HK$72,755.31 million
Unaudited pro forma adjusted consolidated net tangible assets attributable to owners
of the Company per Share as of October 31, 2025 (3) .......................
RMB20.61
HK$22.96
Notes:
(1) The calculation of market capitalization of our H shares is based on 50,451,800 H Shares expected to be issued
immediately following the completion of the Global Offering (assuming the Over-allotment Option is not
exercised).
(2) The calculation of market capitalization of our Shares is based on 50,451,800 H shares and 425,509,152 A Shares
expected to be in issue immediately following the completion of the Global Offering (assuming the Over-allotment
Option is not exercised). The market capitalization of A Shares is calculated based on the average closing price of
the A Shares of RMB143.31 per A Share for the five business days immediately preceding the Latest Practicable
Date and 425,509,152 A Shares in issue as of the Latest Practicable Date.
(3) The unaudited pro forma adjusted consolidated net tangible assets attributable to owners of the Company per Share
is arrived at after the adjustments referred to in “Appendix II — Unaudited Pro Forma Financial Information” and
on the basis that 475,960,952 Shares were in issue assuming the Global Offering had been completed on October
31, 2025 and do not take into account (i) any Shares which may be sold and offered upon exercise of the
Over-allotment Option or (ii) any Shares which may be issued or repurchased by the Company pursuant to the
Company’s general mandates.
SUMMARY
–2 0–


--- page 31 ---
FUTURE PLANS AND USE OF PROCEEDS
Assuming that the Over-allotment Option is not exercised, after deducting the underwriting
commissions and other estimated offering expenses payable by us in connection with the Global
Offering, and assuming the maximum Offer Price of HK$95.80 per Share, we estimate that we will
receive net proceeds of approximately HK$4,630.7 million from the Global Offering. We intend to
use the proceeds from the Global Offering for the purposes and in the amounts set forth below:
 Approximately 50.0% of the net proceeds, or HK$2,315.3 million, will be used in
enhancing the R&D and operational capabilities.
 Approximately 40.0% of the net proceeds, or HK$1,852.3 million, will be used in
improving the production capacity for specialized PCB equipment.
 Approximately 10.0% of the net proceeds, or HK$463.1 million, will be used as
working capital and for general corporate uses to support our daily operations and future
business development.
See “Future Plans and Use of Proceeds.”
RISK FACTORS
Our business and the Global Offering involve certain risks as set out in “Risk Factors.” You
should read that section in its entirety carefully before you decide to invest in our H Shares. Some
of the major risks we face include:
 We historically experienced decreases in our cash flow from operating activities and
recorded operating cash outflows during the Track Record Period, which may adversely
affect our our business, financial condition and results of operations;
 Our business and financial performance are dependent on demand from a number of
downstream industries. A downturn experienced by any of these industries could
adversely affect our business;
 The industries in which we operate are highly competitive. If we fail to compete
effectively and successfully, our business, results of operations and financial condition
may be materially and adversely affected;
 If we fail to keep up with the evolution of technologies or adapt our technology to
emerging industry standards, or if our investments in new technologies prove
unsuccessful or ineffective, our business may be materially and adversely affected;
SUMMARY
–2 1–


--- page 32 ---
 We are susceptible to supply shortages, longer lead time and increased costs of raw
materials and key components, any of which could disrupt our supply chain, increase
our production costs, delay deliveries of our products to customers, and adversely affect
our results of operations;
 Our success depends in part on our ability to enhance our production capabilities and to
produce high quality products;
 Maintaining our brand image is critical to our success, and any failure to do so could
severely damage our reputation and brands, which would have a material adverse effect
on our business, financial condition and results of operations;
 Our business depends substantially on the expertise and dedication of our management
team and key personnel. We may face challenges in recruiting and retaining such
individuals, which could impede our technological advancement and business growth;
and
 Changes in international trade policies, geopolitics and trade protection measures, export
control and economic or trade sanctions may materially and adversely affect our
business, financial condition and results of operations.
See “Risk Factors.”
RECENT DEVELOPMENTS AND NO MATERIAL ADVERSE CHANGE
We have maintained stable business operation and development since October 31, 2025. We
experienced revenue growth in October 2025 compared to the same period in 2024, primarily
driven by (i) the structural growth in demand in downstream application markets of AI servers and
automotive electronics; (ii) technological upgrades which enabled our products to penetrate into
high-end markets; and (iii) an increase in our sales of laser drilling machines in the HDI board
market segment, with multi-terminal applications of smart phones, automotive electronics, and
consumer electronics that significantly generated demand for our products.
Our Directors have confirmed that up to the date of this Prospectus there has been no
material adverse change in our financial or trading position or prospects since October 31, 2025,
and there has been no event since October 31, 2025 which would materially affect the information
shown in the Accountants’ Report set out in Appendix I to this Prospectus.
SUMMARY
–2 2–


--- page 33 ---
DIVIDENDS AND DIVIDEND POLICY
Our dividend policy states that in principle we carry out cash dividends once a year; the
specific dividend ratio shall be formulated by the Board in accordance with relevant regulations
and operating conditions, and deliberated and approved by Shareholders’ general meeting. We do
not currently have any fixed dividend pay-out ratio. Future profit distributions may be carried out
in the form of cash dividends or stock dividends or a combination, or other methods permitted by
laws and regulations, and we preferentially adopt cash dividends. Any proposed distribution is
subject to the discretion of our Board and approval at our Shareholders’ meetings as described
above, after considering our results of operations, financial condition, operating and capital
requirements, shareholders’ interests and other conditions deemed relevant.
During the Track Record Period, we declared cash dividends to our shareholders as follows:
Year ended December 31,
Ten months
ended
October 31,
2022 2023 2024 2025
(RMB in thousands)
Dividends in respect of the previous
year, declared and paid during the
year/period (tax inclusive) ........ 168,000 1,197,000 — 168,000
PROFIT ESTIMATE FOR THE YEAR ENDED DECEMBER 31, 2025
On the basis set out in Appendix IIA to this Prospectus, and in the absence of unforeseen
circumstances, we estimate that our unaudited consolidated profit attributable to equity holders of
the Company for the year ended December 31, 2025 is as follows:
Estimated consolidated profit attributable to equity holders
of the Company ...............................
Not less than RMB785 million
(equivalent to HK$871 million)
SUMMARY
–2 3–


--- page 34 ---
LISTING EXPENSES
Listing expenses represent professional fees, underwriting commissions and other fees
incurred in connection with the Global Offering. We estimate that our listing expenses will be
approximately HK$202.6 million (assuming the maximum Offer Price of HK$95.80 per Offer
Share and no exercise of the Over-allotment Option), representing 4.2% of the gross proceeds
(based on the maximum Offer Price for the Global Offering and assuming that the Over-allotment
Option is not exercised) of the Global Offering. We recorded listing expenses of nil, nil, nil, nil
and RMB1.1 million in 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025,
respectively. We expect to incur listing expenses of approximately HK$202.6 million, of which
approximately HK$6.2 million is expected to be recognized in the consolidated statements of profit
or loss as administrative expenses and approximately HK$196.4 million is expected to be
recognized as a deduction in equity directly upon the Listing. Our Directors do not expect such
expenses to materially impact our results of operations in 2025. By nature, our listing expenses are
composed of (i) underwriting commission and discretionary fees of approximately HK$169.2
million; and (ii) non-underwriting related expenses of approximately HK$33.4 million, which
consist of fees and expenses of legal advisors and Reporting Accountants of approximately
HK$20.9 million and other fees and expenses of approximately HK$12.5 million.
OUR LISTING ON THE SHENZHEN STOCK EXCHANGE
Since February 2022, our Company has been listed on the Shenzhen Stock Exchange. Since
the beginning of the Track Record Period, our Directors confirmed that the Company has been in
compliance with the rules of the Shenzhen Stock Exchange and other applicable securities laws
and regulations of the PRC in any material respect, and, to the best knowledge of our Directors
having made all reasonable enquiries, there were no matters constituting material information
requiring disclosure or should be brought to the investors’ attention in relation to our compliance
record on the Shenzhen Stock Exchange. Our PRC Legal Advisor is of the view that the
confirmation of our Directors above with regard to our compliance record is accurate and
reasonable. Based on the independent due diligence conducted by the Sole Sponsor, nothing has
come to the Sole Sponsor’s attention that would cause them to disagree with our Directors’
confirmation that the Company has been in compliance with the rules of the Shenzhen Stock
Exchange and other applicable securities laws and regulations of the PRC in any material respect
since the beginning of the Track Record Period and up to the Latest Practicable Date.
SUMMARY
–2 4–


--- page 35 ---
OUR CONTROLLING SHAREHOLDERS GROUP
As of the Latest Practicable Date, Mr. Gao was interested in approximately 84.39% of the
total issued share capital of our Company through (i) Han’s Laser as to approximately 83.63% and
(ii) Dazu Holdings as to approximately 0.76%. Han’s Laser is a company listed on the Shenzhen
Stock Exchange (stock code: 002008) and a consolidated subsidiary of Dazu Holdings. As of the
Latest Practicable Date, (i) Han’s Laser was held by Dazu Holdings, Mr. Gao and other A
shareholders as to 15.71%, 9.36% and 74.93%, respectively, and (ii) Dazu Holdings was directly
held as to 99.875% by Mr. Gao, and as to 0.125% by Han’s Global, which was in turn wholly and
beneficially owned by Mr. Gao. As such, Mr. Gao, Han’s Laser, Dazu Holdings and Han’s Global
constitute the Controlling Shareholders Group of our Company.
Immediately following the completion of the Global Offering (assuming the Over-allotment
Option is not exercised and no other changes are made to the issued share capital of our Company
between the Latest Practicable Date and the Global Offering), the Controlling Shareholders Group
will hold in aggregate approximately 75.45% of the issued share capital of our Company.
Therefore, they will remain as the Controlling Shareholders Group upon completion of the Global
Offering.
For further details about our Controlling Shareholders Group, see “Relationship with our
Controlling Shareholders Group.”
SUMMARY
–2 5–


--- page 36 ---
In this Prospectus, unless the context otherwise requires, the following terms and
expressions have the meanings set forth below. Certain other terms are explained in the section
headed “Glossary of Technical Terms” in this Prospectus.
“2023 Restricted Share Incentive
Scheme”
the 2023 restricted share incentive scheme of the Company
as adopted on December 8, 2023
“A Share(s)” ordinary share(s) issued by the Company, with a nominal
value of RMB1.00 each, which is/are subscribed for or
credited as paid in Renminbi and are listed for trading on
the Shenzhen Stock Exchange and are traded in Renminbi
“Accountants’ Report” the accountants’ report of our Company, the text of which
is set out in Appendix I to this Prospectus
“affiliate” 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
“Articles of Association” or
“Articles”
the articles of association of our Company, conditionally
adopted on May 12, 2025 with effect from the Listing Date,
and as amended from time to time, a summary of which is
set out in Appendix V to this Prospectus
“Asia Foundation” Asia Foundation (Shenzhen) Wood Industry Co., Ltd. (ݲ
ܔ(ଉέ)ʮ̡ ), a limited liability company
incorporated in the PRC on January 14, 2000, one of our
major subsidiaries
“Board” or “Board of Directors” the Board of directors of our Company
“Business day” or “business day” a day on which banks in Hong Kong are generally open for
normal banking business to the public and which is not a
Saturday, Sunday or public holiday in Hong Kong
“Capital Market Intermediary(ies)”
or “CMI(s)”
the capital market intermediary(ies) named in the section
headed “Directors and Parties Involved in the Global
Offering” in this Prospectus
DEFINITIONS
–2 6–


--- page 37 ---
“CCASS” the Central Clearing and Settlement System established and
operated by HKSCC
“China”, “mainland China” or
“PRC”
the People’s Republic of China, but for the purpose of this
Prospectus and for geographical reference only and except
where the context requires, references in this Prospectus to
“China” and the “PRC” do not apply to Hong Kong, Macau
Special Administrative Region and Taiwan China
“Companies (Winding up and
Miscellaneous Provisions)
Ordinance”
the Companies (Winding up and Miscellaneous Provisions)
Ordinance (Chapter 32 of the Laws of Hong Kong), as
amended, supplemented or otherwise modified from time to
time
“Companies Ordinance” the Companies Ordinance (Chapter 622 of the Laws of
Hong Kong), as amended, supplemented or otherwise
modified from time to time
“Company”, “our Company” or
“the Company”
Shenzhen Han’s CNC Technology Co., Ltd. ( ଉέ̹ɽૄᅰ
ʮ̡ ), a company established in the PRC
on April 22, 2002, the A Shares of which have been listed
on the Shenzhen Stock Exchange (stock code: 301200)
“Company Law” or “PRC
Company Law”
Company Law of the People’s Republic of China ( ʕശɛ͏
جas amended, supplemented or otherwise
modified from time to time
“Controlling Shareholders Group” Mr. Gao, Han’s Laser, Dazu Holdings and Han’s Global,
see “Relationship with our Controlling Shareholders
Group” in this Prospectus for details
“CSRC” the China Securities Regulatory Commission ( ʕ਷ᗇՎ္
ึ )
“Dazu Holdings” Dazu Holdings Group Co., Ltd. (ʮ̡ ), a
member of the Controlling Shareholders Group, a company
established in the PRC on November 18, 1996, ultimately
controlled by Mr. Gao
“Director(s)” director(s) of our Company
DEFINITIONS
–2 7–


--- page 38 ---
“EIT Law” Enterprise Income Tax Law of the People’s Republic of
China (جas amended,
supplemented or otherwise modified from time to time
“Exchange Participant(s)” a person: (a) who, in accordance with the Hong Kong
Listing Rules, may trade on or through the Hong Kong
Stock Exchange; and (b) whose name is entered in a list,
register or roll kept by the Hong Kong Stock Exchange as a
person who may trade on or through the Hong Kong Stock
Exchange
“Extreme Conditions” the occurrence of “extreme conditions” as announced by
any government authority of Hong Kong due to a super
typhoon or other natural disaster of a substantial scale
seriously affects the working public’s ability to resume
work or brings safety concern for a prolonged period
“FINI” “Fast Interface for New Issuance”, an online platform
operated by HKSCC that is mandatory for admission to
trading and, where applicable, the collection and processing
of specified information on subscription in and settlement
for all new listings
“Global Offering” the Hong Kong Public Offering and the International
Offering
“Group,” “our Group,”
“we” or “us”
our Company and our subsidiaries from time to time, and
where the context requires, in respect of the period prior to
our Company becoming the holding company of its present
subsidiaries, such subsidiaries as if they were subsidiaries
of our Company at the relevant time
“Guide for New Listing Applicants” the Guide for New Listing Applicants as published by the
Stock Exchange, as amended, supplemented or otherwise
modified from time to time
“H Share(s)” ordinary shares in the share capital of our Company with
nominal value of RMB1.00 each, which are to be
subscribed for and traded in HK dollars and are to be listed
on the Hong Kong Stock Exchange
DEFINITIONS
–2 8–


--- page 39 ---
“H Share Registrar” Tricor Investor Services Limited
“Han’s Global” Han’s Global Technology Co., Ltd. (΅Ϟ
ʮ̡), a limited liability company incorporated in the
PRC on December 17, 2007, a member of the Controlling
Shareholders Group
“Han’s Laser” Han’s Laser Technology Industry Group Co., Ltd. ( ɽૄዧ
ʮ̡ ), a company established in
the PRC on March 4, 1999, the A shares of which have
been listed on the Shenzhen Stock Exchange (stock code:
002008), a member of the Controlling Shareholders Group
“Han’s Laser Group” Han’s Laser and its subsidiaries which, for the purpose of
this Prospectus and unless the context otherwise requires,
excludes our Group
“Han’s Microelectronics” Shenzhen Han’s Microelectronics Technology Co., Ltd. ( ଉ
ʮ̡ ), a limited liability company
incorporated in the PRC on June 7, 2021, a subsidiary of
our Company
“HK$” or “HK dollars” Hong Kong dollars and cents, respectively, the lawful
currency of Hong Kong
“HK eIPO White Form ” the application for Hong Kong Offer Shares to be issued in
the applicant’s own name, submitted online through the
designated website at www.hkeipo.hk
“HK eIPO White Form Service
Provider”
the HK eIPO White Form service provider designated by
our Company as specified on the designated website at
www.hkeipo.hk
“HKSCC” Hong Kong Securities Clearing Company Limited, a
wholly-owned subsidiary of Hong Kong Exchanges and
Clearing Limited
DEFINITIONS
–2 9–


--- page 40 ---
“HKSCC EIPO ” the application for the Offer Shares to be issued in the
name of HKSCC Nominees and deposited directly into
CCASS to be credited to your designated HKSCC
Participant’s stock account through causing HKSCC
Nominees to apply on your behalf, including by instructing
your broker or custodian who is a HKSCC Participant to
give electronic application instructions via HKSCC’s FINI
system to apply for the Offer Shares on your behalf
“HKSCC Nominees” HKSCC Nominees Limited, a wholly-owned subsidiary of
HKSCC
“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
t i m ei nf o r c e
“HKSCC Participant” a participant admitted to participate in CCASS as a direct
clearing participant, a general clearing participant or a
custodian participant
“Hong Kong” or “HK” the Hong Kong Special Administrative Region of the PRC
“Hong Kong Listing Rules” or
“Listing Rules”
the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (as amended from time to
time)
“Hong Kong Offer Shares” the 5,045,200 H Shares initially offered by our Company
for subscription at the Offer Price pursuant to the Hong
Kong Public Offering (subject to reallocation as described
in “Structure of the Global Offering” in this Prospectus)
DEFINITIONS
–3 0–


--- page 41 ---
“Hong Kong Public Offering” the offer of the Hong Kong Offer Shares for subscription
by the public in Hong Kong (subject to adjustment as
described in “Structure of the Global Offering” in this
Prospectus) at the Offer Price (plus brokerage, SFC
transaction levy, AFRC transaction levy and Hong Kong
Stock Exchange trading fees), on and subject to the terms
and conditions described in this Prospectus as further
described in “Structure of the Global Offering — Hong
Kong Public Offering” in this Prospectus
“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 listed in
“Underwriting — Hong Kong Underwriters” in this
Prospectus
“Hong Kong Underwriting
Agreement”
the underwriting agreement, dated January 28, 2026,
relating to the Hong Kong Public Offering and entered into
by our Company, the Sole Sponsor, the Sponsor-Overall
Coordinator and the Hong Kong Underwriters, as further
described in the section headed “Underwriting —
Underwriting Arrangements and Expenses — Hong Kong
Public Offering — Hong Kong Underwriting Agreement” in
this Prospectus
“IFRS” International Financial Reporting Standards, which include
standards, amendments and interpretations promulgated by
the International Accounting Standards Board and the
International Accounting Standards and interpretation
issued by the International Accounting Standards
Committee
“Independent Third Party(ies)” any entity or person who is not a connected person of our
Company within the meaning ascribed thereto under the
Listing Rules
DEFINITIONS
–3 1–


--- page 42 ---
“International Offer Shares” the 45,406,600 H Shares initially offered by our Company
for subscription pursuant to the International Offering
together with, where relevant, any additional Shares which
may be issued by our Company pursuant to the exercise of
the Over-allotment Option (subject to reallocation as
described in “Structure of the Global Offering” in this
Prospectus)
“International Offering” the offer of the International Offer Shares by the
International Underwriters at the Offer Price outside the
United States in offshore transactions in accordance with
Regulation S, and in the United States only to QIBs in
reliance on Rule 144A or any other available exemption
from registration under the US Securities Act, as further
described in “Structure of the Global Offering” in this
Prospectus
“International Underwriters” the group of international underwriters, led by the
Sponsor-Overall Coordinator, that is expected to enter into
the International Underwriting Agreement to underwrite the
International Offering
“International Underwriting
Agreement”
the underwriting agreement expected to be entered into on
or around February 4, 2026 by our Company, the Sole
Sponsor, the Sponsor-Overall Coordinator and the
International Underwriters in respect of the International
Offering, as further described in “Underwriting —
Underwriting Arrangements and Expenses — International
Offering” in this Prospectus
“Joint Bookrunners” the joint bookrunners named in the section headed
“Directors and Parties Involved in the Global Offering” in
this Prospectus
“Joint Global Coordinators” the joint global coordinators named in the section headed
“Directors and Parties Involved in the Global Offering” in
this Prospectus
“Joint Lead Managers” the joint lead managers named in the section headed
“Directors and Parties Involved in the Global Offering” in
this Prospectus
DEFINITIONS
–3 2–


--- page 43 ---
“Latest Practicable Date” January 21, 2026, being the latest practicable date for the
purpose of ascertaining certain information contained in
this Prospectus prior to its publication
“Listing” listing of the H Shares on the Main Board of the Hong
Kong Stock Exchange
“Listing Committee” the Listing Committee of the Hong Kong Stock Exchange
“Listing Date” the date, expected to be on or around February 6, 2026, on
which our H Shares are listed and from which dealings
therein are first permitted to take place on the Hong Kong
Stock Exchange
“Macau” the Macau Special Administrative Region of the PRC
“Main Board” the stock market (excluding the option market) operated by
the Stock Exchange which is independent from and
operated in parallel with the Growth Enterprise Market of
the Stock Exchange
“Mason Electronics” Shenzhen Mason Electronics Co., Ltd. (ࠢ
ʮ̡), a limited liability company incorporated in the PRC
on November 17, 1999, one of our major subsidiaries
“MIIT” Ministry of Industry and Information Technology of the
PRC (ʷ௅ )
“Ministry of Finance” or “MOF” Ministry of Finance of the PRC (௅ )
“MOFCOM” Ministry of Commerce of the PRC ( ʕശɛ͏΍ձ਷ਠਕ
௅)
“Mr. Gao” Mr. GAO Yunfeng (ࢤthe ultimate beneficial owner
of Dazu Holdings and a member of the Controlling
Shareholders Group
“NDRC” the National Development and Reform Commission of the
PRC (ึ )
“NPC” the National People’s Congress of the PRC ( ʕശɛ͏΍ձ
ɽึ )
DEFINITIONS
–3 3–


--- page 44 ---
“Offer Price” the final price per Offer Share in Hong Kong dollars
(exclusive of brokerage fee of 1%, SFC transaction levy of
0.0027%, AFRC transaction levy of 0.00015% and Hong
Kong Stock Exchange trading fee of 0.00565%), expressed
in Hong Kong dollars, at which Hong Kong Offer Shares
are to be subscribed, to be determined in the manner further
described in “Structure of the Global Offering — Pricing
and Allocation” in this Prospectus
“Offer Share(s)” 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 expected to be granted by our Company to the
International Underwriters, exercisable by the
Sponsor-Overall Coordinator (on behalf of the International
Underwriters) pursuant to the International Underwriting
Agreement, pursuant to which our Company may be
required to allot and issue up to an aggregate of 7,567,700
additional H Shares at the Offer Price to, among other
things, cover over-allocations in the International Offering,
if any, further details of which are described in “Structure
of the Global Offering” in this Prospectus
“Overall Coordinators” the overall coordinators named in the section headed
“Directors and Parties Involved in the Global Offering” in
this Prospectus
“PBOC” the People’s Bank of China ( ʕ਷ɛ͏ვБ ), the central
bank of the PRC
“PRC Legal Advisor” China Commercial Law Firm, the PRC legal advisors of
our Company
“Price Determination Agreement” the agreement to be entered into by the Sponsor-Overall
Coordinator (for itself and on behalf of the Underwriters)
and our Company on the Price Determination Date to
record and fix the Offer Price
DEFINITIONS
–3 4–


--- page 45 ---
“Price Determination Date” the date, expected to be on or around February 4, 2026
(Hong Kong time) on which the Offer Price is determined,
or such later time as the Sponsor-Overall Coordinator (for
itself and on behalf of the Underwriters) and our Company
may agree, but in any event no later than 12:00 noon on
February 4, 2026
“prospectus” or “Prospectus” this Prospectus being issued in connection with the Hong
Kong Public Offering
“province” a province or, where the context requires, a provincial level
autonomous region or municipality, under the direct
supervision of the central government of the PRC
“QIB” or “Qualified Institutional
Buyer”
a qualified institutional buyer within the meaning of Rule
144A
“Rayleigh Taide” Shenzhen Han’s Rayleigh Taide Precision Coating Co., Ltd. ( ଉ
ʮ̡), a limited liability
company incorporated in the PRC on August 1, 2022 and one
of our subsidiaries
“Regulation S” Regulation S under the US Securities Act
“RMB” or “Renminbi” Renminbi, the lawful currency of the PRC
“Rule 144A” Rule 144A under the US Securities Act
“SAC” the Securities Association of China ( ʕ਷ᗇՎุ՘ึ)
“SAFE” the State Administration of Foreign Exchange of the PRC ( ʕശ
̮ි၍ଣ҅)
“SASAC” State-owned Assets Supervision and Administration
Commission of the State Council ( ਷ਕ৫਷Ϟ༟ପ္ຖ၍ଣ։
ึ)
“SA T” the State Administration of Taxation of the PRC ( ʕശɛ͏΍
೼ਕᐼ҅)
DEFINITIONS
–3 5–


--- page 46 ---
“Securities and Futures Ordinance” or
“SFO”
the Securities and Futures Ordinance (Chapter 571 of the Laws
of Hong Kong), as amended, supplemented or otherwise
modified from time to time
“Securities Law” the Securities Law of the People’s Republic of China ( ʕശɛ
جas amended, supplemented or otherwise
modified from time to time
“SFC” the Securities and Futures Commission of Hong Kong
“Shanghai Stock Exchange” the Shanghai Stock Exchange (ה׸)
Share(s)” ordinary shares in the capital of our Company with a nominal
value of RMB1.00 each, comprising A Shares and H Shares
“Share Award(s)” (type II) restricted share(s) granted under the 2023 Restricted
Share Incentive Scheme, each representing the right to
subscribe for one A Share of our Company at the exercise price
upon vesting
“Shareholders(s)” holder(s) of the Share(s)
“Shenzhen Stock Exchange” the Shenzhen Stock Exchange (ה׸)
Sole Sponsor” the sole sponsor named in the section headed “Directors and
Parties Involved in the Global Offering” in this Prospectus
“Sponsor-Overall Coordinator” the sponsor-overall coordinator named in the section headed
“Directors and Parties Involved in the Global Offering” in this
Prospectus
“Stabilizing Manager” China International Capital Corporation Hong Kong Securities
Limited
“State Council” State Council of the People’s Republic of China ( ʕശɛ͏΍
ձ਷਷ਕ৫)
“subsidiary(ies)” has the meaning ascribed to it in section 15 of the Companies
Ordinance
DEFINITIONS
–3 6–


--- page 47 ---
“Takeovers Code” the Codes on Takeovers and Mergers and Share Buy-backs
issued by the SFC, as amended, supplemented or otherwise
modified from time to time
“Track Record Period” the three years ended December 31, 2022, 2023 and 2024 and
the ten months ended October 31, 2025
“Underwriters” the Hong Kong Underwriters and the International Underwriters
“Underwriting Agreements” the Hong Kong Underwriting Agreement and the International
Underwriting Agreement
“US” or “United States” the United States of America, its territories, its possessions and
all areas subject to its jurisdiction
“US Securities Act” the United States Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder
“US$”, “USD” or “US dollars” United States dollars, the lawful currency of the United States
“V AT” value-added tax
“Xinfeng CNC” Han’s CNC Technology (Xinfeng) Co., Ltd. (Ҧ(ڦ
ᔮ)ʮ̡), a limited liability company incorporated in the
PRC on November 15, 2022, one of our major subsidiaries
“%” per cent
In this Prospectus, the terms “associate,” “close associate,” “connected person,” “core
connected person,” “connected transaction” and “substantial shareholder” shall have the
meanings given to such terms in the Hong Kong Listing Rules, unless the context otherwise
requires.
Certain amounts and percentage figures included in this Prospectus have been subject to
rounding. Accordingly, figures shown as totals in certain tables may not be an arithmetic
aggregation of the figures preceding them. Any discrepancies in any table or chart between the
total shown and the sum of the amounts listed are due to rounding.
For ease of reference, the names of the PRC established companies or entities, laws or
regulations have been included in this Prospectus in both the Chinese and English languages and
in the event of any inconsistency, the Chinese versions shall prevail.
DEFINITIONS
–3 7–


--- page 48 ---
This glossary of technical terms contains explanations of certain technical terms used in
this Prospectus in connection with our Company and our business. Such terminology and
meanings may not correspond to standard industry meanings or usages of those terms.
“3D” three-dimensional
“5G” fifth generation of cellular network technology
“5G-A” 5G-Advanced, the next evolutionary step in 5G technology
“ABF” ajinomoto build-up film
“AI” artificial intelligence
“AIGC” artificial intelligence generated content
“AiP” antenna-in-package technology
“AOI” automated optical inspection
“ASIC” application-specific integrated circuit
“A VI” automated visual inspection
“BMS” battery management system
“BT” bismaleimide triazine
“CAGR” compound annual growth rate
“CCD” charge-coupled device
“CCS” Cell Contact System, a module that connects individual
battery cells within a battery pack, providing both electrical
and electronic connectivity
“CE” Conformité Européenne
“CO
2” carbon dioxide
“CPCA” China Printed Circuit Association
GLOSSARY OF TECHNICAL TERMS
–3 8–


--- page 49 ---
“CPU” central processing unit
“CRM” customer relationship management
“DMD” digital micromirror device
“EMIB” embedded multi-die interconnect bridge
“ERP” enterprise resource planning
“ESG” environmental, social, and governance
“EtherCAT” ethernet for control automation technology
“FC-BGA” flip-chip ball grid array
“FC-CSP” flip-chip chip scale package
“FOPLP” fan-out panel level packaging
“FPC” flexible printed circuit
“GFA” gross floor area
“GPU” graphics processing unit
“HDI” high-density interconnect
“HLC” high layer count
“Internet of Vehicles” a network of connected autonomous vehicles that share data
with each other and other entities in their environment
“LDI” laser direct imaging
“MES” manufacturing execution system
“mm” millimeter
“MPS” master production schedule
“NEV” New Energy Vehicle
GLOSSARY OF TECHNICAL TERMS
–3 9–


--- page 50 ---
“mSAP” Modified Semi-Additive Process
“PCB” printed circuit board
“PDCA” plan-do-check-act
“PI” polyimide
“PP” prepreg
“PVD” physical vapour deposition
“R&D” research and development
“RCC” resin coated copper
“rigid-flex board” boards using a combination of flexible and rigid board
technologies in an application
“SAP S4 HANA” an ERP software for large enterprises developed by SAP
SE, which is a German multinational software company
“SLP” substrate-like PCB
“SoC” system on a chip
“sq.m.” square meter
“SRM” supplier relationship management
“T” terabit per second
“TGV” through glass via
“UL” Underwriters Laboratories
“UV” ultraviolet
“µm” micrometer
GLOSSARY OF TECHNICAL TERMS
–4 0–


--- page 51 ---
We have included in this Prospectus forward-looking statements. Statements that are not
historical facts, including statements about our intentions, beliefs, expectations or predictions
for the future, are forward-looking statements.
This Prospectus contains certain forward-looking statements relating to our Company, our
subsidiaries and consolidated affiliated entities that are based on the beliefs of our management as
well as assumptions made by and information currently available to our management. When used
in this Prospectus, the words “aim”, “anticipate”, “believe”, “could”, “expect”, “going forward”,
“intend”, “may”, “ought to”, “plan”, “project”, “seek”, “should”, “will”, “would” and the negative
of these words and other similar expressions, as they relate to our Group or our management, are
intended to identify forward-looking statements. 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 our Group which
could affect the accuracy of forward-looking statements include, but are not limited to, the
following:
 changes in the macro environment, regional and global economy, as well as industry
trends related to our operations;
 our ability to successfully implement our business plans, strategies, objectives and
goals;
 our ability to obtain adequate capital resources to fund future development plans;
 our ability to control costs, as well as to achieve and maintain operational efficiency;
 changes in our customers’ demands and expectations;
 changes in the competitive landscape of the industries where we operate;
 our ability to protect our reputation and brand image, as well as trademarks,
technologies, knowhow, patents and other intellectual property rights;
 changes in local economic and political conditions and changes in compliance with
international laws and regulations in the countries and regions where we operate; and
 developments in technology and our ability to successfully keep up with technological
advancement.
FORWARD-LOOKING STATEMENTS
–4 1–


--- page 52 ---
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,
before making an investment 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 and adverse
effect on our business, financial condition and results of operations. In any such case, the
market price of our H Shares could decline, and you may lose all or part of your investment.
These factors are contingencies that may or may not occur , and we are not in a position to
express a view on the likelihood of any such contingency occurring. The information given is as
of the Latest Practicable Date unless otherwise stated, will not be updated after the date hereof,
and is subject to the cautionary statements in the section titled “Forward-Looking Statements”
of this Prospectus.
RISKS RELATING TO OUR BUSINESS AND INDUSTRY
Our business and financial performance are dependent on demand from a number of
downstream industries. A downturn experienced by any of these industries could adversely
affect our business.
We primarily provide specialized PCB production equipment for PCB manufacturers. Our
business and financial performance are dependent on the overall performance of various industries
that have demands for electronic devices. If the end product markets cannot maintain robust
growth, our business and profitability may be adversely affected.
The demand for PCBs has been increasing alongside the rapid advancement of technology
and the proliferation of electronic terminal products in China and globally. The growth in sectors
such as server and data storage, automotive electronics, mobile phones, computers and consumer
electronics significantly influences the demand for PCBs and related production equipment. For
instance, the rise of AI and the increasing integration of electronic components in vehicles have
driven the demand for more sophisticated and high-performance PCBs. However, any adverse
changes in these sectors, such as technological shifts or reduced consumer spending, could
negatively impact the demand for PCBs, thereby affecting our business, financial condition and
results of operations. For example, our revenue decreased from RMB2,786.2 million in 2022 to
RMB1,634.3 million in 2023, and our sales volume decreased from 3,702 units to 2,080 units over
the same years. This was largely due to a decline in the industry in which we operate and in
various downstream sectors, as reflected by (i) a decrease in the overall market demand for
specialized PCB equipment in China from approximately US$3.9 billion in 2022 to approximately
US$3.7 billion in 2023; and (ii) a decline in industry output value of various sectors downstream
of PCB equipment, such as servers and data storage, automotive electronics, mobile phones,
RISK FACTORS
–4 2–


--- page 53 ---
computers, and consumer electronics, among others, from approximately US$81.7 billion in 2022
to approximately US$69.5 billion in 2023, which in turn led to a decrease in demand for PCBs and
related upstream equipment.
We need to change or adapt our business focuses from time to time in response to the new
rules and regulations regarding the end markets for our products, but we may not be able to do so
in a timely and efficient manner. Any new rules or regulations or adverse changes in requirements
relating to the end product produced by our equipment could have an impact on our business,
financial condition and results of operations.
Furthermore, our operations are significantly influenced by economic, political and social
conditions in China and globally. Economic downturns, geopolitical tensions, inflations, and/or
changes in monetary policies, in our key markets or our customers’ key markets, whether actual or
perceived, could change demand by players in the downstream industry value chain, which could
materially and adversely affect our financial condition and results of operations. Global
uncertainties, such as geopolitical tensions, inflation risks and changes in monetary policies, also
pose challenges to our business environment.
The industries in which we operate are highly competitive. If we fail to compete effectively
and successfully, our business, results of operations and financial condition may be materially
and adversely affected.
According to CIC, the specialized PCB equipment industry is highly competitive and
relatively fragmented, with the top five manufacturers in the industry in China accounting for
approximately 23.9% of the total market share in terms of revenue in 2024. We primarily compete
with peers on innovation and iteration of technology, products and production processes,
production capacity, supply chain pricing and customer relationships, and failure to compete
successfully on such aspects may adversely affect our results of operations and financial
performance. In particular, we rely on our ability to maintain robust cooperative relationships with
customers and respond rapidly to customer requirements to maintain mutually-beneficial
relationships with our existing and new customers. As we expand our product portfolio, customer
base and geographical markets, we will need significant managerial, financial and human resources
to exceed our competitors in these aspects. We cannot assure you that we can maintain our overall
competitiveness to secure sales orders or gain market share.
We may face increasing competition from emerging companies that may expand the scale of
their operations. In addition, some of our existing and new competitors may have greater financial,
marketing, technical or other resources than us. Greater resources may allow such competitors to
respond to changes in market demand more quickly and produce and sell more advanced products,
as well as better withstand downturns in the markets where we operate. Intense competition may
RISK FACTORS
–4 3–


--- page 54 ---
also lead to further consolidation in the industry. Our competitors may enter into strategic alliances
such as business partnerships or joint ventures, which may enable certain competitors to further
benefit from greater economies of scale and more effectively compete against us. There can be no
assurance that we will be able to continue to compete successfully, and our failure to do so could
have an adverse effect on our business, financial condition and results of operations.
If we fail to keep up with the evolution of technologies or adapt our technology to emerging
industry standards, or if our investments in new technologies prove unsuccessful or
ineffective, our business may be materially and adversely affected.
Technological innovation is key to our success. During the Track Record Period, we made
substantial R&D investments, which we believe are crucial factors for our future growth and
prospects. In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, our research
and development expenses amounted to RMB229.7 million, RMB193.6 million, RMB266.8
million, RMB200.7 million and RMB300.0 million, respectively, accounting for 8.2%, 11.8%,
8.0%, 7.6% and 7.0% of our total revenue in the same years or periods, respectively.
The evolution of technologies and the emergence of new industry standards pose significant
challenges. If we fail to keep up with these changes or adapt our technology accordingly, our
competitive position could be compromised. This may necessitate additional investments in
technology upgrades and process improvements to align with industry standards. Failure to do so
could result in our products becoming obsolete, leading to a potential loss of market share and
adversely affecting our business operations. However, there can be no assurance that our R&D
projects will yield the expected outcome or be completed within the anticipated time frame and
budget. If we fail to commercialize our R&D efforts, we may incur significant sunk costs. Even if
the newly developed products can be launched as we expected, there can be no assurance that they
will be accepted by our customers and achieve the anticipated sales target or profit. In addition, a
portion of our research and development expenses is allocated to developing foundational
technologies rather than specific products. While this investment is important for long-term
innovation and capability building, it may not immediately enhance the competitiveness of our
products in the market or produce the expected benefits or returns in the short term. Furthermore,
there can be no assurance that our existing or potential competitors will not develop products
which are technologically similar or superior to ours or are more competitively priced. In such
cases, we may lose market share. Due to uncertainties in the time frame for developing new
products and the duration of market windows for these products, there is a risk that we may have
to abandon a product that is no longer commercially viable, even after we have invested
significant resources in the development of such product.
RISK FACTORS
–4 4–


--- page 55 ---
We are susceptible to supply shortages, longer lead time and increased costs of raw materials
and key components, any of which could disrupt our supply chain, increase our production
costs, delay deliveries of our products to customers, and adversely affect our results of
operations.
Our production operations depend on obtaining adequate supplies of high-quality raw
materials on a timely basis. The raw materials used in our production of specialized PCB
production equipment mainly include sheet metal and machined parts, mechanical devices,
purchased modules and optical devices. In 2022, 2023, 2024 and the ten months ended October 31,
2024 and 2025, our costs on raw materials and consumables used amounted to RMB1,639.9
million, RMB993.2 million, RMB2,196.6 million, RMB1,734.5 million and RMB2,650.1 million,
respectively, accounting for 89.2%, 85.8%, 90.2%, 89.6% and 89.2% of our cost of sales,
respectively. The purchase price of our raw materials is influenced by changes in bulk commodity
prices as well as market supply and demand. The pricing of our products is, to a certain extent,
based on the costs of our direct materials. Due to the one-time pricing model adopted in our
procurement, we may not be able to adjust the procurement cost of our raw materials in response
to subsequent market price changes during the contract period. This may expose us to the risk of
high procurement costs if raw material prices decrease after we have entered into procurement
contracts at higher prices. If we become subject to any significant increase in the cost of raw
materials that was not anticipated when negotiating the prices with our customers, our profitability
may be adversely affected.
In addition, we may not be able to avoid raw material shortage and there can be no assurance
that we will be able to identify all of the quality issues of the raw materials we purchase. In the
event that our suppliers fail to cater to our growing demands, we may be unable to meet market
demand for our products, which may have an adverse impact on our reputation and profitability.
Additionally, factors that are beyond our control, including natural disasters, public health hazards,
civil unrest, wars, strikes or trade sanctions or restrictions, may impact the supply and market
price of raw materials. Any such factor could disrupt our procurement of raw materials and could
have a material adverse effect on our production capacity utilization, which, in turn, will adversely
affect our business, financial condition and results of operations.
RISK FACTORS
–4 5–


--- page 56 ---
Our success depends in part on our ability to enhance our production capabilities and to
produce high quality products.
Our success depends in part on our ability to enhance our production capabilities, which
includes optimizing our production capacity, improving our production efficiency or modifying our
production facilities to meet the varying demands for our products. Failing to do so may prevent
us from achieving the economies of scale needed to reduce manufacturing costs, compete
effectively, and maintain our pricing and other competitive advantages. Our ability and efforts to
enhance our production capabilities are subject to significant risks and uncertainties, including:
 our ability to obtain funding for the additional capital expenditures, working capital and
other corporate requirements to be used to enhance our production capabilities. We may
be unable to obtain such funds in a timely manner or on commercially reasonable terms
or at all;
 unexpected delays and cost overruns resulting from a number of factors, many of which
may be beyond our control. These include increases in the prices of raw materials,
components and utilities, shortages of workers and transportation constraints, as well as
equipment malfunctions and breakdowns;
 our ability to obtain the required permits, licenses and approvals from relevant
government authorities;
 availability of the necessary technology or equipment from our R&D team;
 diversion of management attention and other resources; and
 production interruption caused by natural disasters or other unforeseen events.
Construction of new production facilities or the expansion of existing facilities also requires
significant capital investment upfront, and it may take a considerable amount of time before such
facilities achieve their expected capacity or breakeven point. Failure to manage our cash flow and
financial condition prior to such breakeven point may drain our financial resources and adversely
affect our business, financial condition and results of operations.
RISK FACTORS
–4 6–


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Maintaining our brand image is critical to our success, and any failure to do so could severely
damage our reputation and brands, which would have a material adverse effect on our
business, financial condition and results of operations.
Our success depends on our ability to maintain and enhance our brand image and reputation,
whose value depends on factors such as the quality, design, performance, functionality and
durability of our products, product innovation and customer experience. We intend to continue
investing in these areas in order to develop, maintain and enhance our brand image and reputation.
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, our selling and
marketing expenses amounted to RMB160.5 million, RMB132.2 million, RMB196.1 million,
RMB160.7 million and RMB235.8 million, respectively, accounting for 5.8%, 8.1%, 5.9%, 6.1%
and 5.5% of our total revenue, respectively. Expenses associated with maintaining our brand image
can be significant, and we may further incur substantial expenses to establish our brand image in
new markets we may enter. However, we cannot assure you that our investments in these areas
would be successful, and expenses related to maintaining our brand image and reputation may
have an adverse impact on our business, financial condition and results of operations if they do not
yield the expected results.
Our brands, reputation and product sales could be harmed if, for example, our products fail to
meet the expectations of our customers or contain defects. In addition, adverse publicity about
regulatory or legal action against us could damage our reputation and brand image, undermine
customer confidence in us and reduce long-term demand for our products.
In addition, negative publicity concerning our Group, including our shareholders, affiliates,
directors, officers, employees, business partners and other third parties, as well as the broader
industry, can have detrimental effects. Such publicity, regardless of its accuracy, can tarnish our
reputation, resulting in loss of customer trust, decreased sales and challenges in maintaining or
establishing business relationships with our customers. It can also result in heightened scrutiny
from regulators and stakeholders, potentially leading to increased compliance costs or legal
challenges, subsequently affecting our business, financial condition and results of operations.
Our business depends substantially on the expertise and dedication of our management team
and key personnel. We may face challenges in recruiting and retaining such individuals,
which could impede our technological advancement and business growth.
We have been, and will continue to be, substantially dependent on the continued services of
our management team and key personnel. Retaining talent depends on our ability to overcome
cultural differences, improve employee engagement and satisfaction, and offer more competitive
compensation than our competitors. If we lose the services of any key member of them, we may
not be able to find suitable replacements in a timely manner, at acceptable cost or at all. Inability
RISK FACTORS
–4 7–


--- page 58 ---
to retain of skilled professionals could lead to delays in product development, hinder our ability to
respond to market demands, and affect our capacity to manage and integrate our international
operations effectively. Additionally, the loss of key personnel or the inability to attract new talent
could result in a loss of institutional knowledge and expertise, adversely affecting our business
operations and future prospects. Loss of key personnel to our competitors may provide such
competitors an edge over our products, technologies or business management, which could harm
our overall competitiveness. Failure to address these challenges may negatively impact our
business, financial condition and our ability to achieve strategic objectives in the rapidly evolving
technology sector.
The shortage of skilled professionals could lead to a decline in management and operational
efficiency, thereby affecting our competitiveness. Our leading position in the specialized PCB
equipment industry depends on the strength of our management and operation. As we are
expanding our business both domestically and internationally, we need to continuously improve
our management practices to sustain our leading market position. However, there is no assurance
that we can always ensure the continued effectiveness of our management systems or sustain our
operational efficiency. A decline in management and operational efficiency may expose us to
challenges such as resource mismanagement, supply chain disruptions, or difficulties in further
scaling our productions. These challenges could adversely affect our competitiveness and make it
difficult for us to sustain our market-leading position.
In addition to retention of key personnel, our business operations and expansion in China and
globally depend on our ability to recruit new employees. Our ability to innovate and maintain a
competitive advantage relies heavily on attracting highly qualified professionals in fields where we
operate to continuously innovate and iterate our existing products and expand into our strategic
emerging business. However, the competition for such talent is intense, and there is a risk that we
may not be able to recruit the necessary personnel to support our growth and international
expansion strategies.
Changes in international trade policies, geopolitics and trade protection measures, export
control and economic or trade sanctions may materially and adversely affect our business,
financial condition and results of operations.
Our global operations subject us to various applicable sanctions and export controls
regulations. During the Track Record Period, we sold our specialized PCB production equipment
to over 10 countries and regions. In 2022, 2023, 2024 and the ten months ended October 31, 2024
and 2025, revenue from our overseas operations comprised approximately 1.3%, 5.2%, 10.8%,
11.5% and 12.8% of our total revenue, respectively. In the event that any of these countries or
regions which we export to imposes economic sanctions or enforces import restrictions or tariffs in
relation to our products, our business and operations may be adversely affected.
RISK FACTORS
–4 8–


--- page 59 ---
We are subject to laws and regulations related to economic sanctions and export control
across various jurisdictions, such as European Union, Southeast Asia and Taiwan China, which
prohibit the provision of products and services to certain countries, regions, governments, and
sanctioned individuals or entities. For example, European Union sanctions have regimes to prohibit
the provision of products and services to countries or regions, governments and persons on their
respective target list. These laws are subject to frequent changes, and their interpretation and
enforcement can be uncertain, often influenced by national security or political factors beyond our
control. Any of the above or their continued changes could result in enforcement actions, penalties,
and material adverse impacts on our business. Additionally, broader government policies affecting
international trade and investment — such as tariffs, capital controls, foreign investment
regulations, and outbound investment restrictions — may reduce demand for our products, hinder
our competitiveness, or limit our ability to operate in certain markets. If our customers are subject
to and/or are found in violation of any of the abovementioned laws and regulations, their demand
for our products may be significantly reduced, which in turn could materially and adversely affect
our business performance and financial results.
In particular, the evolving U.S. foreign policy and trade regulations, particularly the potential
introduction of further trade restrictions and tariffs on specific products and products originating
from certain countries or regions, could disrupt our supply chain, increase costs and negatively
impact our ability to compete in the global market. Moreover, such changes could potentially
provoke retaliatory measures from other countries, exacerbating international trade tensions and
the above adverse impacts on our business. For example, the U.S. implemented several rounds of
import tariffs on products of Chinese origin, and in response the PRC government also imposed
tariffs on certain products imported from the U.S. into China. Following further bilateral
negotiations between the United States and China and subsequent executive and administrative
measures, the U.S. tariff regime applicable to PRC-origin goods has been adjusted. As of the
Latest Practicable Date, PRC-origin goods in general are subject to an additional U.S. tariff rate of
approximately 20% (comprising a 10% additional tariff and a 10% reciprocal tariff), while certain
consumer electronics, including smartphones and computers, are exempt from the reciprocal tariff
and are generally subject only to the 10% additional tariff. As of the Latest Practicable Date,
U.S.-origin goods imported into China are in general subject to an additional 10% reciprocal tariff
as a countermeasure to U.S. Section 301 tariffs (in each case on top of the applicable
most-favoured-nation or other base import tariff rates). It is uncertain whether and when any
further tariff restrictions will be implemented. Additionally, policy changes and related uncertainty
about policy changes could increase market volatility. We cannot assure you that our supply chain,
overall business operations and financial performance will not be materially adversely affected by
laws or regulations related to international trade adopted by the U.S. or other countries.
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We are subject to risks associated with the overseas expansion of our business.
Our overseas expansion is also subject to operational risks. We plan to continue to expand
our business in selected overseas markets, especially in Southeast Asia. As a result, we are subject
to a variety of risks and uncertainties associated with overseas operations and sales, including
compliance with foreign laws, regulations and local industry standards, in particular, those related
to specialized PCB equipment industry; export control and economic sanctions laws and
regulations; exposure to increased overseas litigation risks; political and economic instability, as
well as geopolitical tensions, including the threat of war or terrorist attacks; foreign currency
exchange rate fluctuations, currency controls and cash repatriation restrictions; unfamiliarity with
local operating and market conditions and competitive landscapes; uncertainty on the degree of
market acceptance; competition from local companies; failure to attract and retain locally qualified
management and employees; alignment of the operations, culture and systems of the international
team with our existing operations; foreign taxes; environmental, safety and labor regulatory
compliance; and potential disputes and difficulty in managing relationships with overseas
customers and distributors. Additionally, we distribute our products to overseas markets and we
may expand our business in overseas markets, and we will face management risks associated with
the growth of our international team and the management of territories under our international
strategy.
Any failure to manage the foregoing and other risks and uncertainties could result in
operational inefficiencies, increased costs and a diversion of management’s attention from other
business matters, which in turn could adversely affect our overseas business and its expansion, and
result in reduced turnover from our overseas operations, which in turn could materially and
adversely affect our business, financial condition and results of operations.
In addition, our success in expanding our business, providing products and services
internationally and competing in international markets is subject to our ability to manage various
risks and difficulties, including, but not limited to:
 difficulties in gaining an in-depth understanding of local markets, communities and
cultures;
 higher levels of payment fraud, legal and compliance risks;
 higher shipment costs;
 requirement to adapt to possible import and export controls, sanctions, trade embargoes
and other heightened regulatory requirements;
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 challenges and increased expenses associated with staffing and managing international
and cross-border operations and managing an organization spread over various
jurisdictions;
 ability to recruit talent and challenges in replicating or adapting our policies and
procedures to operate in new markets;
 difficulties of integrating any foreign acquisitions;
 ability to provide sufficient levels of technical support in different locations or provide
sufficient oversight over the management of our overseas subsidiaries;
 difficulties in establishing cooperative relationships with international partners,
including local operators;
 ability to develop and maintain relationships with customers and other local
stakeholders; and
 potential damage to our brand and reputation if we are unable to provide optimal
products and services to our customers or properly oversee the management of our
operations in such local markets.
As we expand further into new regions and markets, these risks could intensify. If one or
more of these factors were to materialize, it could adversely impact our international operations,
and our efforts to expand our operations internationally may not be successful.
We are exposed to inventory management risks.
Our inventories primarily consist of raw materials, semi-finished goods, work-in-progress,
materials consigned for processing, finished goods and goods in transit. As of December 31, 2022,
2023, 2024 and October 31, 2025, our inventories were RMB903.9 million, RMB972.1 million,
RMB898.2 million and RMB1,716.9 million, respectively. Our inventory turnover days for the
same years or period was 210 days, 296 days, 140 days and 132 days, respectively.
If we underestimate product demand or face supply disruptions, we may experience inventory
shortages that could disrupt production, delay deliveries, and harm customer relationships. We
cannot guarantee our inventory will meet customer needs promptly, which may reduce revenue and
adversely affect our business and financial condition. On the other hand, failure to manage
inventory effectively may lead to excessive inventory level, which could increase inventory and
warehousing costs, increase risk of inventory obsolescence, and incur significant write-offs. We
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cannot ensure all inventory will be sold within a reasonable time, and any such inventory may be
subject to decline in value. Any of the above could materially adversely affect our results of
operations and financial condition.
In the event of any damage or deterioration caused by factors beyond our control, including
catastrophic events such as outbreak of fire or explosion, we may suffer from losses and such
losses may not be compensated in a timely and adequate manner. Our business performance and
financial position may thereby be adversely affected.
We historically experienced decreases in our cash flow from operating activities and recorded
operating cash outflows during the Track Record Period, which may adversely affect our our
business, financial condition and results of operations.
We have historically experienced decreases in our cash flows from our operating activities. In
2022, 2023 and 2024, we had net cash generated from operating activities of RMB655.4 million,
RMB416.8 million and RMB155.0 million, respectively. In the ten months ended October 31, 2024
and 2025 we had net cash used in operating activities of RMB123.3 million and RMB754.4
million, respectively. We recorded operating cash outflow for the ten months ended October 31,
2025, primarily due to (i) a timing mismatch between cash inflows from sales and cash outflows
for purchases; and (ii) higher performance-based remuneration and an increase in headcount, which
further increased cash outflows related to employee compensation. See “Financial Information —
Liquidity and Capital Resources — Net Cash Flows from/(Used in) Operating Activities.”
To improve the net cash outflow position as of October 31, 2025, we continued to implement
liquidity measures, such as steady cash flow operations and budgeting, collaborating with sales
department, adopting rolling budgets, and following up on customer payments. Further, we
increased the proportion of prepayments to secure earlier cash inflows and reduce reliance on
extended installment settlements, which typically delay cash collection. For example, with regards
to certain types of our equipment products designed for AI servers, we initially offered credit
periods ranging from 12 to 20 months upon launch. As we further upgraded our products and
improved their competitiveness, and taking into account market competitive landscape, we actively
negotiated with customers and were able to bargain for shortened credit periods ranging from
approximately three to 12 months, with the specific credit period for each customer determined
after careful analysis of each customer’s creditworthiness and historical credit records. We believe
such significant operating cash outflow in the ten months ended October 31, 2025 is temporary,
and that the above measures will lead to improvements in our operating cash flow position for the
full year of 2025.
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We experienced similar operating cash outflow in the ten months ended October 31, 2024 as
well, because in 2024, we experienced a significant increase in sales revenue, which in turn
required us to expand our procurement scale to meet such increase in demand, resulting in a
significant increase in payments to suppliers. In the ten months ended October 31, 2024, our trade
receivable turnover days reached 240 days, and we experienced net cash used in operating
activities of RMB123.3 million.
To reduce such turnover days and improve operating cash flow position, we focused on the
following, which we also continued to implement and improve in 2025:
 maintaining steady cash flow operations and budgeting by enhancing cash flow
forecasting and payment scheduling with an aim to optimize payment timing and
maintain a balance between cash payments and the need to support essential operational
expenditure and procurement;
 collaborating with the sales department to set collection targets;
 adopting quarterly rolling budgets, and conducting reviews and analyses on variances
between budgeted and actual figures to identify underlying reasons; and
 following up on customer payments in a timely manner, including implementing targeted
collection strategies, particularly for customers with longer outstanding receivables.
We also enhanced collection efforts in the last two months of 2024, adopted bank acceptance
bills to optimize the procurement payment cycle, and incentivized our sales personnel to expedite
cash collection. As a result of the above measures our trade receivable turnover days improved
from 240 days in the ten months ended October 31, 2024 to 228 days for the year ended December
31, 2024. Benefitting from the above measures, our net operating cash outflow of RMB123.3
million in the ten months ended October 31, 2024 reverted to a net operating cash inflow of
RMB155.0 million in the full year of 2024.
Our ability to generate sufficient operating cash flow depends on many factors, such as the
ability to achieve profitability, carry on our business activities in an efficient manner, the ability to
effectively manage payables and receivables for the purpose of liquidity, the extended inspection
processes by our customers, changes in general market conditions and the regulatory environment
and competition in certain sectors in which we operate. Any adverse change in any of these
factors, which may be out of our control, may create capital shortfall and could adversely affect
our liquidity. We cannot guarantee that our cash from operating activities will improve, and there
is no assurance that our operating activities will be able to generate sufficient cash flow to satisfy
our capital and liquidity needs at all times, or even at all.
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We may incur additional indebtedness, and increased cost of indebtedness in the future could
affect our business, results of operations and liquidity.
During the Track Record Period, we had certain borrowings to finance our business
operations and capital expenditures. We expect to continue to do so in the future and our liquidity
risk may increase. As of December 31, 2022, 2023, 2024 and October 31, 2025, our
interest-bearing borrowings amounted to RMB17.2 million, RMB75.7 million, RMB213.5 million,
and RMB825.9 million, respectively. The effective interest rate on our bank loans ranged from
2.08% to 3.60% per annum during the Track Record Period and up to November 30, 2025. See
“Financial Information — Indebtedness — Interest-bearing Borrowings.”
High indebtedness levels could necessitate a greater allocation of our cash flow towards
principal and interest repayments, limiting funds available for working capital and strategic
initiatives. Additionally, it may constrain our flexibility in adapting to industry changes or
pursuing new opportunities, restrict access to further financing and heighten our exposure to
interest rate fluctuations and unforeseen adverse events. Additionally, restrictive covenants in the
indebtedness may further limit our capacity to raise additional debt or equity financing, potentially
leading to defaults that could accelerate repayment obligations, jeopardizing our financial stability.
If we fail to manage our indebtedness properly, our business, results of operations and financial
condition may be materially and adversely impacted.
We are subject to credit risks related to our trade and bills receivables.
Our trade receivables and bills receivables mainly refer to outstanding amount due from our
customers and related parties for the purchase of goods we sold in the ordinary course of business,
less credit loss allowance. Our trade and bills receivables decreased by 22.6% from RMB2,267.7
million as of December 31, 2022, to RMB1,755.7 million as of December 31, 2023, primarily due
to a decrease in sales. Our trade and bills receivables increased by 62.1% to RMB2,846.1 million
as of December 31, 2024 and further increase by 64.7% to RMB4,687.2 million as of October 31,
2025, primarily due to an increase in sales resulting from the surge in demand for IT infrastructure
in the AI industry chain, coupled with the recovery of the consumer electronics sector and the
technological upgrade of automotive electronics. Our trade receivables turnover days were 254
days, 377 days, 228 days, 242 days, in 2022, 2023, 2024, and the ten months ended October 31,
2025 respectively. See “Financial Information — Discussion of Certain Components of
Consolidated Statements of Financial Position — Trade and Bills Receivables” for details. We
cannot assure you that we will be able to collect all or any of our trade and bills receivables on
time, or at all. The occurrence of such event would materially and adversely affect our financial
condition and results of operations.
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If we fail to maintain an effective quality management system, particularly during production
expansion, our business, reputation, financial condition and results of operations may be
adversely affected.
Our product quality is critical to our success. Our quality management system may not
always identify latent product defects, which could lead to failures during installation or use,
resulting in safety hazards or operational issues for our customers. The effectiveness of our quality
management system depends on a number of factors, including the design of the system, the
machineries used, the quality of our staff and related training programs and our ability to ensure
that our employees adhere to our quality management policies and guidelines. In the event our
equipment products result in an unsafe condition or injury to any of downstream industry players
as a result of component failures, production flaws, design defects or inadequate disclosure of
product-related risks or information, among other factors, we could be subject to product liability
or warranty claims; we could be named as a defendant in such claims, and any insurance that we
carry may not be sufficient or it may not apply to all situations. Similarly, our customers could be
subjected to claims as a result of such accidents and bring claims against us to hold us
accountable. In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, we
recorded six, seven, one, one and three warranty claims, with the amounts of warranty claims
being approximately RMB0.1 million, RMB1.3 million, RMB3.5 thousand, RMB3.5 thousand and
RMB0.2 million, respectively. In the event that our products fail to perform as expected or such
failure of our products results in a recall, our reputation may be damaged, which could make it
more difficult for us to sell our products to existing and prospective customers and could
materially and adversely affect our business, results of operations and financial condition.
Scaling up production to meet rising demand may strain our quality assurance processes by
pushing personnel and equipment beyond optimal capacity, increasing the risk of oversights or
errors. Higher volumes may cause bottlenecks, rushed evaluations, and accelerated equipment wear
and tear, all of which can compromise product quality. Process changes or new technologies
introduced during scale-up may also lead to unforeseen quality issues for which we may
experience delay in formulating and implementing appropriate quality standards and measures.
Additionally, sourcing extra materials or components under time pressure can introduce variability,
further elevating the risk of defects or non-compliance with standards.
Any significant failure in, or deterioration of the efficacy of, our quality management system
could result in us losing accreditations and requisite certifications or qualifications, which could in
turn have a material adverse effect on our reputation, business and results of operations.
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We may not be able to increase our production capacity and implement other expansions as
planned.
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, the actual
production volume of our Shenzhen production base was 3,208, 1,979, 2,600, 2,420 and 4,710
units. In 2023, 2024 and the ten months ended October 31, 2024 and 2025, the actual production
volume of our Xinfeng production base was 424, 1,710, 953 and 1,227 units. We intend to
maintain our competitive advantages by, among others, expanding our production capacity and
exploring new business opportunities in the specialized PCB equipment industry. Such expansion
plans and any other future expansion plans would require significant capital investments in new
production facilities and in the engagement of additional qualified personnel. To capture these
opportunities, we intend to improve the production capacity and enhance the R&D and operational
capabilities. See “Future Plans and Use of Proceeds.” We expect to incur substantial additional
costs, such as depreciation charges, raw material costs, financial costs and labor costs in relation to
the above expansion plans. In addition, the success of our existing and future expansion plans
depends on factors beyond our control, such as progress of the construction conducted by
third-party construction companies, government support, including the ease of obtaining relevant
licenses for the expanded production capacity, and customer demand for products that could
occupy our expanded production capacity. The integration of future expansion projects into our
existing operations may be subject to unforeseeable delays, which may, among other things,
increase our integration costs, strain our production capacity at other locations, decrease our
production efficiency and cause delays in delivery of customer orders. As the success of our
business expansion plans depends on various factors, many of which are beyond our control, there
can be no assurance that we will be successful in implementing our strategies. Even if our
strategies are implemented successfully, there can be no assurance that our strategies will lead to
successful achievement of our business objectives.
Moreover, we may seek to expand our business through cooperation, strategic investments,
mergers and acquisitions and partnership in the future. The success of these endeavors depends on
the availability of, and competition for, suitable targets and opportunities, as well as financial
resources, including available cash and financing capacity. Moreover, future cooperations, strategic
investments, mergers and acquisitions and partnerships may expose us to potential risks, including
the diversion of management attention and resources from our existing business and the inability
to generate sufficient income to offset the costs and expenses. These endeavors may also result in
an increased leverage, sharing of potential legal liabilities in respect of the target businesses and
increased impairment charges related to goodwill and other intangible assets. As a result, we
cannot assure you that we will be able to achieve the strategic purpose of any investment,
partnership or cooperation, the desired level of control in management decisions of the partnership
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or our anticipated investment return from such business expansion. If we are unable to implement
our expansion plans effectively, our business, financial condition and results of operations may be
materially and adversely affected.
In addition, if our management, systems, resources and supporting infrastructure fail to
effectively keep up with our planned expansion, we may experience difficulties in managing our
growth and operations, and our financial condition and results of operations could be materially
and adversely affected.
If we are unable to maintain high utilization of our production facilities, our profitability
may be adversely affected, particularly if there is industry overcapacity.
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, the actual
production volume of our Shenzhen production base was 3,208, 1,979, 2,600, 2,420 and 4,710
units, representing a utilization rate of 90.6%, 80.6%, 90.7%, 91.4% and 95.6%, respectively. In
2023, 2024 and the ten months ended October 31, 2024 and 2025, the actual production volume of
our Xinfeng production base was 424, 1,710, 953 and 1,227 units, representing a utilization rate of
89.1%, 96.7%, 93.2% and 96.8%, respectively. High utilization of production facilities is crucial
for spreading fixed costs over a larger quantity of products. Consequently, our ability to maintain
or improve gross margins depends significantly on sustaining high utilization rates. However,
various adverse factors, such as shortages in customer orders, excess capacity, equipment
malfunction, interruptions in utility availability and quality control deficiencies, could negatively
affect our facility utilization.
Specifically, overcapacity caused by shortages in customer demand for specialized PCB
production equipment could exacerbate the challenges of maintaining high utilization rates. The
increase in global production capacity, driven by anticipated demand for more specialized PCB
production equipment, may be higher than actual market demand increase. If demands industries
do not grow as expected, or if our production capacity significantly exceeds this growth trajectory,
we may face periods of industry-wide oversupply and the consequent price drop, as well as lower
margins caused by under utilization of production capacity. If customer demand declines
significantly, parts of our production facilities may become idle. This situation could lead to
obsolescence of our facilities over time. Any of the above could materially and adversely affect
our business, financial condition and results of operations.
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Our business requires a significant amount of capital expenditure for the expansion of our
production capacity, and there can be no assurance that we will be able to have enough cash
to successfully implement our capital expenditure plans.
Our operations depend on the expansion of our production capacity to meet evolving
customer demands and market trends. As a manufacturer of specialized PCB production equipment,
we require significant capital expenditure, which primarily consists of expenditures for the
purchases of property, plant and equipment, other intangible assets and other non-current assets, to
ensure the quality, efficiency and competitiveness of our products.
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, our capital
expenditures were RMB143.8 million, RMB242.4 million, RMB224.1 million, RMB195.2 million
and RMB114.2 million, respectively. There can be no assurance that we will be able to generate
sufficient cash from operations, or at all, to fund our planned capital expenditures. Any delays or
failures in securing necessary funding and any unforeseen increases in costs or delays in the
implementation of our capital expenditure plans could adversely affect our operations and financial
results. Moreover, the development in industries where we operate may require us to make
additional, unforeseen investments to remain competitive. If we fail to allocate sufficient resources
toward adapting to these technological changes or if our investments do not yield the expected
benefits, our market position and profitability may be adversely impacted.
Our production processes are potentially vulnerable to disruptions that can increase our
production costs. We may experience potential disruptions in operations due to production
difficulties or potential accidents.
Our production process is relatively complex, requiring regular equipment upgrades and
renovations, ongoing maintenance, and expansion of our skilled assembly team to improve
production yield and product performance while reducing unit production costs. From time to time,
production difficulties may arise that could cause delivery delays or reduced output. There is no
guarantee that we will not encounter production issues in achieving acceptable output or timely
product delivery due to factors such as construction delays, challenges in upgrading or modifying
existing production lines, building new plants, adapting to new production technologies or
processes or delays in equipment deliveries. Any of these issues could constrain our production
capacity and adversely affect our results of operations.
Furthermore, our production processes entail certain risks, such as industrial accidents, which
could lead to significant property damage or personal injury. Any such incident, regardless of its
location, could result in substantial production interruptions and delays, or claims for significant
damages due to personal injuries or property damage, thereby adversely impacting our business,
financial condition and operational results.
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We may not be able to adequately protect or enforce our intellectual property rights or
prevent unauthorized parties from copying or reverse engineering our products, and such
efforts to defend and protect our intellectual property may be costly.
The success of our products and our business depends in part on our ability to obtain patents
and other intellectual property rights and maintain adequate legal protection for our products in the
jurisdictions where we operate. We rely on a combination of patent, trademark, trade secret and
laws related to intellectual property in China and other countries and regions to establish and
protect our proprietary rights, and yet all of which may provide only limited protection.
We cannot assure you that patents will be issued with respect to our currently pending patent
applications in a manner that gives us adequate defensive protection or competitive advantages, if
at all, or that any patent issued to us will not be challenged, invalidated or circumvented. Our
currently issued patents and any patents that may be issued or registered in the future, as well as
other types of intellectual property rights we own or will own, may not provide sufficiently broad
protection or may not prove to be enforceable in actions against alleged infringers. We cannot
assure you that the steps we have taken will prevent unauthorized use of our technology or the
reverse engineering of our technology. The confidentiality procedures and contractual restrictions
implemented by us may not be sufficient or effective.
Protecting against the unauthorized use of our intellectual property and other proprietary
technology is expensive and difficult. Unauthorized parties may attempt to copy or reverse
engineer our technologies or certain aspects of our products that we consider proprietary.
Litigation may be necessary in the future to enforce or defend our intellectual property rights, to
prevent unauthorized parties from copying or reverse engineering our products, to determine the
validity and scope of our proprietary rights or to block infringing products where we operate. Any
such litigation, whether initiated by us or a third party, could result in substantial costs and
diversion of management resources, either of which could adversely affect our business, financial
condition and results of operations. Even if we obtain favorable outcomes in litigation, we may not
be able to obtain adequate remedies.
If we encounter issues with our trademark licensing, our business operations may be
adversely affected.
Our use of the trademarks “HANS CNC” and/or “ ɽૄᅰછ” is based on a licensing
agreement with Han’s Laser, a member of our Controlling Shareholders Group. These trademark
are integral to our brand identity and market recognition. If any disputes were to arise regarding
the terms of the licensing agreement, our ability to use the trademarks “HANS CNC” and/or “ ɽૄ
ᅰછ” could be compromised. Such an event could adversely affect our business operations, as we
may need to rebrand or invest in establishing a new brand identity, which could incur significant
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costs and impact our market position. Additionally, any legal disputes over the trademark may
result in damage to our reputation, additional operating costs and diversion of resources and
management’s attention from our business operations, thereby adversely affect our business,
financial condition and results of operations.
We may not be able to detect and prevent fraud committed by third parties.
We are exposed to the risk of fraud committed by agents, customers or other third parties that
could subject us to financial losses and sanctions imposed by governmental authorities as well as
seriously harm our reputation. Our internal control system and procedures are designed to monitor
our operations and overall compliance. However, they may be unable to identify non-compliance
and/or suspicious transactions in a timely manner, or at all. Further, it is not always possible to
detect and prevent fraud, and the precautions we take to prevent and detect such activities may not
be effective. There will therefore continue to be the risk that fraud may occur, which may have an
adverse effect on our business, reputation, financial performance and results of operations.
We are exposed to the risk of fraud committed by our suppliers. Failure by any of our
suppliers to fulfill the commitment to integrity may lead to ethical issues and subject us to
potentially severe reputational risk and loss of profit and decline in the trust of customers and
partners.
We are dependent upon third parties for services in connection with our business.
We from time to time engage third-party manufacturers to meet customer demand. In 2022,
2023, 2024 and the ten months ended October 31, 2024 and 2025, we engaged a total of 142, 170,
169, 157 and 186 manufacturing contractors, with manufacturing fees of RMB58.6 million,
RMB39.7 million, RMB63.1 million, RMB51.4 million and RMB92.7 million, respectively. This
outsourcing exposes us to risks such as inconsistent product quality, delays in delivery, and
reduced control over production processes. If third-party partners fail to meet our specifications,
timelines, or compliance standards, it could result in customer dissatisfaction, reputational harm,
and potential loss of business. Additionally, any disruption in their operations — due to labor
issues, supply shortages, or geopolitical factors — may adversely affect our ability to fulfill
orders, which could materially impact our business operations and financial performance.
In addition, we rely on certain third-party service providers for services in connection with
our business, such as logistics services and labor dispatch. However, the services delivered by
third-party providers may not always be timely or meet satisfactory quality standards. If the
third-party service providers fail to perform satisfactorily, substantially reduce the amount and
scope of services provided to us, or substantially increase the prices of their services or terminate
their business relationship with us, we may need to replace the third-party service providers or
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take other remedial actions, which could increase our costs of operations. As we do not have direct
control over the third-party service providers, if they become involved in the provision of services
without relevant qualifications, or fail to comply with our requirements or those of our customers,
our reputation in the industry may be adversely affected. This, in turn, may materially and
adversely affect our business, financial condition and results of operations.
We may be subject to penalties relating to labor dispatch.
On December 28, 2012, the Labor Contract Law of the PRC ()
was amended to impose more stringent requirements on labor dispatch and such amendments
became effective on July 1, 2013. For example, dispatched workers may only engage in temporary,
auxiliary or substitute work. In addition, the number of dispatched workers engaged by an
employer may not exceed a certain percentage of its total number of workers, to be decided by the
Ministry of Human Resources and Social Security. Pursuant to the Interim Provisions on Labor
Dispatch () (the “ Interim Provisions on Labor Dispatch ”) which has
become effective since March 1, 2014, an employer shall strictly control the number of dispatched
workers engaged, which shall not exceed 10% of the total number of its workers (the “ Limit ”).
The total number of workers refers to the sum of (i) the number of employees who have entered
into employment agreements with the employer; and (ii) the number of dispatched workers
engaged by such employer.
During the Track Record Period, the number of dispatched workers engaged by us and some
of our subsidiaries exceeded the Limit, primarily because (i) with the customers’ order demand
growth, we need additional workers to deliver customer orders in short term, resulting in the
number of dispatched workers exceeding the stipulated Limit in relevant periods; and (ii) our staff
were unfamiliar with and misunderstood relevant laws and regulations, and did not seek proper
advice from external advisers or our management team. During the Track Record Period and up to
the Latest Practicable Date, we and our subsidiaries had not been subject to any administrative
penalties or other disciplinary actions relating to labor dispatch by relevant government authorities.
Our PRC Legal Advisor has advised us that, pursuant to relevant PRC laws and regulations, if the
number of dispatched workers exceeds the Limit, the employer may be ordered to make
corrections within a time limit by labor administrative authorities, and failure to make such
corrections may lead to a fine ranging from RMB5,000 to RMB10,000 per dispatched worker
imposed by labor administrative authorities.
We cannot assure you that the relevant government authorities will not impose penalties on us
and our subsidiaries for historical non-compliance, which may adversely affect our business,
profitability and reputation.
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Our deferred tax assets may not be recoverable, which may affect our financial conditions in
the future.
As of December 31, 2022, 2023, 2024 and October 31, 2025, our deferred tax assets
amounted to RMB58.1 million, RMB67.1 million, RMB50.0 million and RMB89.3 million,
respectively. Deferred tax assets arise from the deductible temporary differences between the
carrying amounts of assets and liabilities from financial reporting purposes and their tax base, as
well as unused tax losses and unused tax credits. Deferred tax assets are recognized to the extent
that it is probable that future taxable profit will be available against which the deductible
temporary differences can be utilized. This requires significant judgment on the tax treatment of
certain transactions and also assessment on the probability that adequate future taxable profits will
be available for the deferred tax assets to be recovered. In this context, we cannot guarantee that
the recoverability of our deferred tax assets and to what extent they may affect our financial
condition in the future.
Our Share-based payments may result in shareholding dilution and have a material and
adverse effect on our financial performance and condition
We have granted, and may continue to grant, share-based payments to our employees
(including Directors) and other eligible persons as part of our remuneration and incentive
arrangements. For example, on May 21, 2025, our share capital increased as a result of the
issuance of A shares upon the vesting of share awards granted under our 2023 Restricted Share
Incentive Scheme. See “Appendix VI — Statutory and General Information — 4. Our Incentive
Scheme.”
The grant and vesting of share-based payments may result in the issuance of additional
Shares, which may dilute the shareholding percentage of our existing Shareholders. In addition, in
accordance with applicable accounting standards, expenses in respect of share-based payments are
recognized as employee benefit expenses in our consolidated financial statements, which may
increase our operating expenses and adversely affect our financial performance and condition.
There is no assurance that the grant or vesting of share-based payments will not have a material
adverse effect on our results of operations, financial position or the interests of our Shareholders.
We are subject to various operational risks during our ordinary course of business.
Our business is subject to a variety of operational risks, including production disruptions due
to operational errors, power outages, equipment failures and suspension; operational restrictions
imposed by environmental or other regulatory requirements; social, political and labor unrest;
environmental or industrial accidents; and catastrophic incidents such as fires, earthquakes,
explosions, floods or other natural disasters. In addition, we bear safety risks associated with our
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production activities, including work injury accidents. Such dangers may result in personal injuries
or fatalities and damage to property and equipment, which may cause personal injury claims,
cessation of business or civil, administrative and criminal penalties.
The occurrence of any of these events may result in disruption of our operations and cause us
to suffer substantial losses or incur significant liabilities. We may not have adequate or any
insurance to cover these operational risks. If we incur material losses or liabilities, and insurance
is not adequate to cover such losses or liabilities, our business, financial condition and results of
operations may be materially and adversely affected.
Our insurance policies may not provide adequate coverage for all claims associated with our
business operations.
Our employees are covered by accident insurance, critical illness insurance, overseas
insurance (for employees travelling abroad) and employer’s liability insurance (for interns and
rehired retirees). Our company and assets are covered by property insurance and cargo
transportation insurance (for machinery during shipping), property all risks insurance (for fixed
assets, inventory, etc.) and motor insurance. We consider our insurance coverage to be customary
for business of our size and type and in line with standard commercial practice in the PRC. For
more details of our insurance policies, see “Business — Insurance.” However, there are types of
losses we may incur that cannot be insured against or that we believe are not commercially
reasonable to insure, such as loss of reputation. If we were held liable for uninsured losses or
amounts and claims for insured losses exceeding the limits of our insurance coverage, our business
and results of operations may be materially and adversely affected.
We received government grants and preferential tax treatment during the Track Record
Period, and any discontinuation of government grants or preferential tax treatment or any
change in the relevant policies may adversely affect our results of operations and financial
performance.
During the Track Record Period, we received certain government grants and preferential tax
treatment according to relevant policies. During the Track Record Period, government grants
mainly comprised incentives provided by local government authorities in China, including various
forms of government financial incentives and awards to facilitate technological innovation, and tax
rebate on certain of the software components within our products. In 2022, 2023, 2024 and the ten
months ended October 31, 2024 and 2025, our government grants amounted to RMB139.9 million,
RMB64.5 million, RMB60.0 million, RMB47.7 million and RMB50.7 million, respectively. See
“Financial Information — Description of Major Components of Our Results of Operations —
Other Income and Gains, Net.” Meanwhile, certain subsidiaries of our Company were eligible for
certain preferential corporate income tax rates during the Track Record Period. Government grants
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are recognized when there is reasonable assurance that they will be received and that we will
comply with all the conditions attaching to them. These government grants were mainly
non-recurring in nature, and the amounts of these grants were subject to the discretion of local
governments. We cannot guarantee that we will receive such government grants and preferential
tax treatment in the future, and our business, financial condition and results of operations may be
adversely affected if we fail to obtain such government grants and preferential tax treatment in the
future.
Fluctuations in exchange rates could adversely affect our results of operations.
Fluctuations in exchange rates, particularly among the Renminbi, Euro, US dollars, HK
dollars and other currencies, could affect our profitability. In 2022, our net foreign exchange gain
was RMB1.8 million. In 2023 and 2024, our net foreign exchange losses were RMB7.1 million and
RMB2.3 million, respectively. In the ten months ended October 31, 2024 and 2025, our net foreign
exchange losses were RMB4.6 million and RMB34.1 million, respectively. We may not be able to
accurately predict the impact of exchange rate fluctuations on our results of operations and may
incur net foreign exchange losses, which may have a material and adverse effect on our business,
financial condition and results of operations.
In addition, an appreciation in the value of the Renminbi against foreign currencies could
increase the prices of some of our products, thereby making them less appealing to our overseas
customers, which could adversely affect our strategy in our overseas markets. On the other hand,
depreciation in the value of the Renminbi against foreign currencies could result in an increase in
the costs of certain raw materials, parts and components that are primarily sourced from overseas
suppliers, which could in return adversely affect our profit margin for certain products.
We may be the subject of unfair competition, harassing or other detrimental conduct by third
parties, including complaints to regulatory authorities, negative social media postings and the
public dissemination of malicious statements related to us that could harm our reputation
and affect our business operations.
As an established brand, our image is sensitive to the public’s perception of us as a business
in entirety, which includes not only the quality of our products, but also our corporate management
and culture. We cannot guarantee that we may not be the subject of unfair competition, harassment
or other detrimental conduct by third parties. Such conduct includes complaints to regulatory
authorities, negative social media postings and malicious assessments against us. We may be
subject to government or regulatory investigation as a result of such third-party conduct and may
be required to spend significant time and incur substantial costs to address such third-party
conduct, and there is no assurance that we will be able to conclusively refute each of the
allegations within a reasonable period of time. Additionally, allegations against us may be
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disseminated by anyone, whether or not related to us. Social media often publish such content
without verifying the accuracy of the content posted and without affording us an opportunity for
redress or correction. Any such detrimental conduct against our Company, Directors, employees,
spokespersons or products, regardless of veracity, could harm our reputation, or lead to potential
loss of consumer confidence or difficulty in retaining or recruiting talents that are essential to our
business operations. As a result, our business, financial condition and results of operations may be
materially and adversely affected.
We may not be able to procure new customer orders through tenders as planned or at a
desirable pace or on favorable terms.
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, we secured 51, 41,
51, 36 and 45 customer orders through tender and bidding processes, respectively, which generated
revenue of RMB307.7 million, RMB179.3 million, RMB240.8 million, RMB86.3 million and
RMB165.8 million, accounting for 11.0%, 11.0%, 7.2%, 3.3% and 3.8% of our total revenue in the
same years or periods, respectively. The selection of specialized PCB production equipment providers
depends on a number of factors, including but not limited to the quality of products and services
provided, the level of pricing and the operating capabilities of the provider. Tender outcome is
ultimately at the discretion of the inviting party, and our efforts may be hindered by factors beyond
our control, which may include, among others, changes in general economic conditions and evolving
government regulations as well as supply and demand dynamics within the industry. We cannot assure
you that we will be able to maintain our high success rate in procuring new customer orders in the
future as planned or at a desirable pace or on favorable terms.
We may be involved in legal proceedings and commercial or contractual disputes, which
could materially and adversely affect our reputation, business, results of operations and
financial condition.
We have been and may continue to be involved in litigation and other legal proceedings
during the ordinary course of business operations such as product liability, labor disputes, contract
disputes or intellectual property disputes, which may adversely affect our financial condition. In
addition, we may have to pay legal costs associated with such disputes and proceeding, including
fees relating to appraisal, auction, execution and legal advisory services. Litigation and other
disputes may lead to inquiries, investigations and proceedings by regulatory authorities and other
governmental agencies and may result in damage to our reputation, additional operating costs and
diversion of resources and management’s attention from our business operations. The disruption of
our business due to judgment, arbitration and legal proceedings against us or adverse adjudications
in proceedings against our Directors, senior management or key employees may materially and
adversely affect our business, financial condition and results of operations.
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Our future strategic acquisitions or investments, if any, may not be successful, and we may
not realize anticipated strategic benefits and financial returns from such transactions.
We may engage from time to time in acquisitions and other strategic investments in order to
expand our production capacity, diversify our product portfolio, gain access to new markets and
stable sources of raw materials or acquire new technologies. However, there can be no assurance
that our efforts, any past or future acquisitions or investments, will be successful or that we will
achieve the anticipated strategic benefits and financial returns from such transactions.
There are various risks associated with our acquisitions and investments, which include the
following:
 challenges related to integration of acquired company’s or investee’s operations into our
business;
 substantial delays or reduction in anticipated synergies;
 events beyond our control, including changes in regulations, technology and economic
conditions, which could adversely affect our ability to realize benefits and returns from
such transaction;
 potential increase in indebtedness that could constrain our operations;
 exposure to unknown or contingent liabilities that could require significant expenditures
and capital injections;
 failure to train, motivate, integrate and retain employees of acquired company or
investee;
 diversion of management time and attention from our existing operations to address the
transactions and related challenges or those associated with integration processes; and
 unanticipated write-offs or charges and impairment of goodwill.
Furthermore, we are subject to valuation risks in connection with acquisitions. Determining
the fair value of acquired businesses, assets and liabilities involves significant management
judgment and assumptions. If our estimates prove to be inaccurate or if business conditions change
adversely following an acquisition, we may be required to record impairment charges that could
materially harm our reported financial performance. In addition, acquisitions could result in the
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use of substantial amounts of cash, potentially dilutive issuances of equity securities, the
incurrence of debt, the incurrence of significant goodwill impairment charges, amortization
expenses for other intangible assets and exposure to potential unknown liabilities of the acquired
business.
If we fail to address any of the foregoing risks, our business, financial condition and results
of operations may be materially and adversely affected.
Failure to make fully and timely social insurance and housing provident fund contributions
for some of our employees as required by PRC laws and regulations may subject us to
payments of outstanding amounts, overdue charges or penalties imposed by relevant
governmental authorities.
Companies operating in the PRC are required to make social insurance and housing provident
funds for their employees. During the Track Record Period, we did not make full social insurance
and housing provident fund contributions in accordance with the relevant PRC laws and
regulations for certain employees. Our PRC Legal Advisor has advised us that, pursuant to relevant
PRC laws and regulations, we may be ordered by the relevant PRC authorities to pay the
outstanding social insurance contributions within a prescribed time limit and may be subject to an
overdue charge of 0.05% of the delayed payment per day. If such payment is not made within the
stipulated period, the competent authority may further impose a fine from one to three times the
amount of any overdue payment. Our PRC Legal Advisor has further advised us that, pursuant to
relevant PRC laws and regulations, if we fail to pay the full amount of housing provident fund
contributions as required, the housing provident fund management center 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 the PRC courts for compulsory enforcement.
If the relevant authorities order us to fully contribute the social insurance and/or housing
provident funds, we would make full contributions and take rectification measures as soon as
possible within the specified period. During the Track Record Period and up to the Latest
Practicable Date, we have not received any notice requiring us to pay any outstanding social
insurance and housing provident fund contributions, nor have we been subject to any
administrative action or penalty by the relevant regulatory authorities with respect to our social
insurance and housing provident fund contributions.
According to the Judicial Interpretation (II) of the Supreme People’s Court on the Application
of Law in the Trial of Labor Dispute Cases (ਪᕚ
༆ᙑ(ɚ)), promulgated by the Supreme People’s Court on August 1, 2025 and effective from
September 1, 2025, any agreement between a PRC employer and an employee or an employee’s
undertaking to the employer on the non-contribution of social insurance shall be deemed invalid by
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the people’s court. If an employee requests to terminate the employment agreement and seek
economic compensation on the grounds that the employer has failed to pay social insurance
contributions in accordance with the applicable laws, the people’s court shall support such claims.
Conversely, if the enterprise has lawfully paid the social insurance contributions and then requests
the employee to return the compensation already paid, the people’s court shall also support such
claim.
We cannot assure you that any new laws and regulations or any changes in the
implementation of the existing laws and regulations will not require us to pay any contribution
shortfall, overdue charges or penalties retroactively, thereby adversely affecting our financial
condition and results of operations.
Our rights to use some of our leased properties could be challenged by third parties due to
defects, which may adversely affect our business operations and financial condition.
We leased certain properties in the PRC in connection with our business operations. As of the
Latest Practicable Date, (i) lessors of 16 leased properties did not provide valid title certificates;
and (ii) 19 lease agreements had not been registered with relevant authorities as required by
applicable PRC laws and regulations. As advised by our PRC Legal Advisor, failure to complete
the registration of lease agreements may lead to a fine ranging from RMB1,000 to RMB10,000
imposed by the relevant PRC authorities for each of these lease agreements if we fail to complete
the registration of lease agreements within the stipulated period. As a result, we cannot assure you
that we will not be subject to any challenges, lawsuits or other actions taken against us with
respect to such leases. We may need to expend significant management and financial resources to
arrange relocation from these relevant properties. If we fail to find qualified alternative premises
on terms acceptable to us, or if we are subject to any material liability resulting from challenges to
our leases of properties for which our lessors do not hold valid titles or failed to complete the
necessary procedures, our ordinary course of business may be disrupted and delayed, materially
adversely affecting our business operations, financial condition and results of operations. See
“Business — Properties — Leased Properties.”
Our business may be materially and adversely affected by force majeure events, natural
disasters or other issues beyond our control.
Natural and man-made disasters and other force majeure events which are beyond our control
may adversely affect the economy, infrastructure and livelihood of the people there. An occurrence
or recurrence of any of such events could result in disruptions to our operations, which could
adversely affect our business, financial condition and results of operations.
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Our business operations could be disrupted if any of our employees is suspected of
contracting any epidemic disease, since it could require our offices or facilities to be closed for
disinfection or other remedial measures, which would adversely delay or disrupt our production
schedule, and we may experience raw material shortages or price surges if the operations of any of
our suppliers are disrupted by pandemics.
Moreover, natural disasters, including earthquakes, floods, landslides and droughts, could
result in deaths, significant economic losses and significant and extensive damage to factories,
power lines and other properties, as well as blackouts, transportation and communications
disruptions and other losses in the affected areas. Any future natural disasters, public health and
public security hazards may, among other things, materially and adversely affect or disrupt our
operations. Furthermore, such natural disasters, public health and public security hazards may
severely restrict the level of economic activity in affected areas, which may in turn materially and
adversely affect our business, results of operations and prospects.
RISKS RELATED TO THE LOCAL LAWS AND REGULATIONS OF THE JURISDICTIONS
WHERE WE CONDUCT BUSINESS
Changes to the existing regulatory regime relating to the sectors where we operate our
business may limit our ability to provide product offerings, thereby materially and adversely
affecting our business, financial condition and results of operations.
In recent years, the PRC government has, on many occasions, promoted the development of
the specialized PCB equipment industry. New laws, rules and regulations relevant to our
businesses may be introduced in the future, or the current applicable regulations may otherwise be
amended or replaced, requiring us to conduct business with additional oversight and regulatory
compliance. There can be no assurance that we can adapt to the evolving regulatory environment
swiftly enough or in a cost-efficient manner, failure of which may adversely affect our operations
and lead to substantial costs. Meanwhile, we may need to implement changes in our facilities,
equipment, personnel or services to comply with the latest laws and regulations, which may
increase our capital expenditures and operating expenses, thereby adversely affecting our business,
financial condition and results of operations.
We are subject to the environmental protection laws and regulations as well as the complex
and evolving ESG requirements, which require us to devote substantial time and resources
for compliance and could adversely affect our business and financial performance.
Our business is subject to extensive and increasingly stringent environmental protection laws
and regulations. There is an increasing focus on corporate responsibility and a number of
regulations and requirements on ESG performance pose reputational, regulatory and other risks to
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us. We believe that it is our responsibility to devote substantial time and resources to develop
technology and products designed to reduce our carbon footprint and maintain environmentally
friendly business operations. The process of developing new production technologies and
enhancing existing production technologies to mitigate climate change is often complex, costly and
uncertain, and we may pursue strategies or make investments that do not prove to be commercially
successful in the time frames expected, or at all. Moreover, not all of our competitors may seek to
establish climate or other ESG targets and goals, or at a comparable level to ours, which could
adversely affect our competitiveness in the relevant market.
Compliance with these ESG requirements and relevant environmental protection laws and
regulations requires additional investments of resources. We risk damage to our brand and our
reputation in the event that our corporate responsibility procedures or standards do not meet the
standards set by various third parties. In addition, in the event that we communicate certain
initiatives and goals regarding ESG matters, we could fail, or be perceived to fail, in our
achievement of such initiatives or goals, or we could be criticized for the scope of such initiatives
or goals. Any of these circumstances could cause negative publicity, and our business operations
could be adversely impacted.
Policies and regulations regarding foreign currency conversion may impact our foreign
exchange transactions, including dividend payments to holders of our Shares and our ability
to finance in foreign currencies.
The conversion of RMB into foreign currencies should be in compliance with relevant laws
and regulations. We receive a majority of our revenue in RMB, and undertake certain transactions
denominated in foreign currencies. Under existing PRC foreign exchange regulations, payments of
current account items, including profit distributions, interest payments and trade and
service-related foreign exchange transactions can be made in foreign currencies without prior
approval of the SAFE by complying with certain procedural requirements. However, the laws,
regulations and governmental policies regarding currency conversion are generally complex and
developing. If we cannot obtain sufficient foreign currencies to satisfy our foreign currency
demands via the foreign exchange regulation system, we may not be able to pay dividends in
foreign currencies to our Shareholders. Foreign exchange transactions under our capital account
are subject to the relevant foreign exchange regulations and policies and may need approval from
the SAFE or its local branches. These regulations could affect our ability to obtain foreign
exchange through equity financing, or to obtain foreign exchange for capital expenditures.
Moreover, there is no assurance that new regulations within China will not be introduced in the
future to further regulate inward or outward remittance of RMB. Any existing or future currency
exchange requirements could limit our ability to purchase raw materials and components outside
China or otherwise fund any future business activities conducted in foreign currencies.
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Certain judgments obtained against us by our Shareholders may be difficult to enforce.
We are a company incorporated under the laws of the PRC, and nearly all of our assets and
subsidiaries are located in the PRC. The majority of our Directors and senior management reside
within the PRC. Judgments rendered by Hong Kong courts may be recognized and enforced in the
PRC if the requirements set forth by 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 (the “ Arrangement ”) (ಥतй
τર ) are met. Nonetheless, there is no assurance
that all judgments rendered by the Hong Kong courts will be recognized and enforced in China, as
recognition and enforcement of a particular judgment is subject to the relevant courts’
case-by-case review of the relevant courts according to the Arrangement. It may be difficult for
you to effect service of process within Hong Kong upon us or these persons, or to bring an action
in Hong Kong against us or against these individuals in the event that you believe that your rights
have been infringed under the applicable securities laws or other laws. In addition, it may be
difficult for you to bring an original action against us or our PRC resident officers and Directors in
a PRC court based on the liability provisions of non-PRC securities laws.
Any uncertainties embedded in the legal systems of certain geographic markets where we
operate could affect our business, financial condition and results of operations.
Legal systems of the geographic markets where we operate vary significantly from
jurisdiction to jurisdiction. Some jurisdictions have a civil law system based on written statutes
and others are based on common law. Unlike the common law system, prior court decisions under
the civil law system may be cited for reference but have limited precedential value.
We are subject to certain uncertainties embedded in the legal systems of some geographic
markets where we operate. Laws and regulations that are recently enacted may not sufficiently
cover all aspects of economic activities in such markets. In particular, the interpretation and
enforcement of these laws and regulations are subject to future implementations, and the
application of some of these laws and regulations to our businesses is not settled. Since local
administrative and court authorities are authorized to interpret and implement statutory provisions
and contractual terms, it may be difficult to evaluate the outcome of administrative and court
proceedings and the level of legal protection we have in many of the geographic markets where we
operate. Local courts may have discretion to reject the enforcement of foreign awards or
arbitration awards. These uncertainties may affect our judgment on the relevance of legal
requirements and our ability to enforce our contractual rights or claims. In addition, the regulatory
uncertainties may be exploited through unmerited or frivolous legal actions, claims concerning the
conduct of third parties, or threats in attempt to extract payments or benefits from us.
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Furthermore, many of the legal systems in the geographic markets where we operate are
based in part on their respective government policies and internal rules, some of which are not
published on a timely basis or at all and may have retroactive effects. There are other
circumstances where key regulatory definitions are unclear, imprecise or missing, or where
interpretations that are adopted by regulators are inconsistent with interpretations adopted by a
court in analogous cases. As a result, we may not be aware of our violation of certain policies or
rules until sometime after the violation. In addition, administrative and court proceedings in some
of our geographic markets may be protracted, resulting in substantial costs and diversion of
resources and management attention.
It is possible that a number of laws and regulations may be adopted or construed to be
applicable to us in our geographic markets and elsewhere that could affect our businesses and
operations. Scrutiny and regulations of the industries in which we operate may further increase,
and we may be required to devote additional legal and other resources to addressing these
regulations. Changes in current laws or regulations or the imposition of new laws and regulations
in our geographic markets may slow the growth of the specialized PCB production equipment and
affect our business, financial condition and results of operations.
We are a mainland China enterprise and we are subject to mainland China tax on our global
income and any gains on the sales of H Shares and dividends on the H Shares may be subject
to mainland China income taxes.
Under the PRC EIT Law and its implementation rules, subject to any applicable tax treaty or
similar arrangement between mainland China and a non-mainland China investor’s jurisdiction of
residence that provides for a different income tax arrangement, mainland China withholding tax at
the rate of 10% is normally applicable to dividends from mainland China sources payable to
investors that are non-mainland China resident enterprises which do not have an establishment or
place of business in mainland China, or which have an establishment or place of business in
mainland China but the relevant income is not effectively connected with such establishment or
place of business. Any gains realized on the transfer of Shares by such investors are subject to a
10% mainland China income tax rate if such gains are regarded as income from sources within
mainland China unless a treaty or similar arrangement provides otherwise.
Under the PRC Individual Income Tax Law () and its
implementation rules, dividends from sources within mainland China paid to foreign individual
investors who are not mainland China residents are generally subject to a 20% mainland China
withholding tax rate, and gains from mainland China sources realized by such investors on the
transfer of shares are generally subject to a 20% mainland China income tax rate, in each case,
subject to any reduction or exemption under applicable tax treaties and laws in mainland China.
Pursuant to the Notice on the Issues Concerning Individual Income Tax Collection and
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Management after the Repeal of Guo Shui Fa [1993] No. 045 (਷೼೯ [1993]045 ໮˖΁ᄻ˟
) (Guo Shui Han [2011] No. 348) ( ਷೼Ռ[2011]348 ໮) dated
June 28, 2011, issued by the SAT, dividends paid to non-mainland China resident individual
holders of H Shares are generally subject to the individual income tax of mainland China at a
withholding tax rate of 10%, depending on whether there are tax arrangements between the
jurisdictions where the individual holders reside, as well as the tax arrangements between
mainland China and Hong Kong. Non-mainland China resident individual holders who reside in
jurisdictions that have not entered into tax treaties with mainland China are subject to a 20%
withholding tax on dividends received from us.
If mainland China income tax is imposed on gains realized from the transfer of our H Shares
or on dividends paid to our non-mainland China resident investors, the value of your investment in
our H Shares may be affected. Furthermore, our Shareholders whose jurisdictions of residence
have tax treaties or arrangements with mainland China may not qualify for benefits under such tax
treaties or arrangements.
RISKS RELATING TO THE GLOBAL OFFERING
We will be concurrently subject to listing and regulatory requirements of mainland China
and Hong Kong.
As we are listed on the Shenzhen Stock Exchange and will be listed on the Main Board in
Hong Kong, we will be required to comply with the listing rules (where applicable) and other
regulatory regimes of both jurisdictions, unless an exemption is available or a waiver has been
obtained. Accordingly, we may incur additional costs and resources in continuously complying
with all sets of listing rules in the two jurisdictions.
The characteristics of the A share and H share markets may differ.
Our A Shares are listed and traded on the Shenzhen Stock Exchange’s ChiNext Market.
Following the Global Offering, our A Shares will continue to be traded on the Shenzhen Stock
Exchange’s ChiNext Market and our H Shares will be traded on the Stock Exchange. Under the
current laws and regulations of China, without the approval from the relevant regulatory
authorities, our H Shares and A Shares are neither interchangeable nor fungible, and there is no
trading or settlement between the H Share and A Share markets. With different trading
characteristics, the H Share and A Share markets have divergent trading volumes and liquidity and
investor bases, as well as different levels of retail and institutional investor participation. As a
result, the trading performance of our H Shares and A Shares may not be comparable. Nonetheless,
fluctuations in the price of our A Shares may adversely affect the price of our H Shares, and vice
versa. Due to the different characteristics of the H Share and A Share markets, the historical prices
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of our A Shares may not be indicative of the performance of our H Shares. You should therefore
not place undue reliance on the trading history of our A Shares when evaluating the investment
decision in our H Shares.
There has been no prior public market for our H Shares, and their liquidity and market price
may be volatile.
There was no public market for our H Shares prior to the Global Offering. There can be no
guarantee that a public market for our H Shares with adequate liquidity and trading volume will
develop and be sustained following the completion of the Global Offering. In addition, the Offer
Price of our H Shares is expected to be fixed by agreement between the Sponsor-Overall
Coordinator (for itself and on behalf of the Underwriters) and us, which may not be indicative of
the market price of our H Shares following the completion of the Global Offering.
If an active public market for our H Shares does not develop following the completion of the
Global Offering, the market price and liquidity of our H Shares may be materially and adversely
affected.
The liquidity, trading volume and market price of our H Shares following the Global
Offering may be volatile, which could result in substantial losses to investors.
The price at which our H Shares will trade after the Global Offering will be determined by
the marketplace, which may be affected by various factors beyond our control, including:
 our financial performance;
 changes in securities analysts’ estimates, if any, of our financial performance;
 the history of, and the prospects for, ourselves and the industry in which we operate;
 an assessment on the prospects for, and timing of, our future revenue and cost;
 structures that independent research analysts may publish, if any;
 the present state of our development;
 the valuation of publicly traded companies that are engaged in business activities;
 general market sentiment regarding the industry we operate in;
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 changes in laws and regulations of China;
 our actual or perceived failure to compete effectively in the market; and
 political, economic, financial and social conditions.
In addition, the Hong Kong Stock Exchange has from time to time experienced significant
volatility in trading prices and volumes that have affected the market prices of securities of
companies quoted on the Hong Kong Stock Exchange. As a result, investors in our H Shares may
experience volatility in the market price of their H Shares and a decrease in the value of their H
Shares regardless of our operating performance or prospects.
Actual or perceived sale, availability for sale or enforcement of share pledges of substantial
amounts of our Shares could adversely affect the market price of our Shares.
Future sales of a substantial number of our Shares, especially by our Directors, executive
officers and Controlling Shareholders Group, or the perception or anticipation that such sales
might occur, could negatively impact the market price of our Shares and our ability to raise equity
capital in the future at a time and price that we deem appropriate. In addition, 3,231,900 A Shares
directly held by Dazu Holdings are subject to the Share Pledge granted in favour of Shenzhen
High Tech Investment. See “Substantial Shareholders — Share Pledge by Dazu Holdings” for
details. Certain amount of the Shares controlled by our Controlling Shareholders Group are subject
to certain lock-up periods beginning on the date on which trading in our Shares commences on the
Stock Exchange. We cannot assure you that such persons will not dispose of any Shares they may
own now or in the future. If Dazu Holdings fail to fullfil its obligations in respect of the Share
Pledge, the Share Pledge may be enforced, leading to transfer of the pledged A Share and Dazu
Holdings’ failure to comply with Rule 10.07 of the Listing Rules. In addition, certain existing
Shareholders of our Shares are not subject to lock-up agreements. Market sale of Shares by such
Shareholders and the availability of these Shares for future sale may have a negative impact on the
market price of our Shares.
You will incur immediate and substantial dilution, and may experience further dilution in the
future.
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.
In order to expand our business, we may consider offering and issuing additional Shares in the
future. Purchasers of the Offer Shares may experience dilution in the net tangible asset value per H
Share of their H Shares if we issue additional Shares in the future at a price which is lower than
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the net tangible asset value per H Share at that time. Furthermore, we may issue Shares pursuant
to any existing or future share option incentive scheme, which would further dilute our
Shareholders’ interests in our Company.
Our Controlling Shareholders Group has substantial influence over our Group and their
interests may not be aligned with the interests of our other Shareholders.
Our Controlling Shareholders Group has significant influence in determining the outcome of
any corporate transaction or other matter submitted to the Shareholders for approval, including but
not limited to mergers, privatizations, consolidations and the sale of all, or substantially all, of our
assets, election of directors and other significant corporate actions. Immediately following the
completion of the Global Offering (assuming the Over-allotment Option is not exercised), the
Controlling Shareholders Group will be together entitled to control the exercise of approximately
71.45% of the voting rights and thus remain as the Controlling Shareholders Group of our
Company. The interests of our Controlling Shareholders Group might differ from the interests of
our other Shareholders. In the event that our Controlling Shareholders Group causes us to pursue
strategic objectives that conflict with the interests of our other Shareholders, our other
Shareholders could be disadvantaged, and their interests could be damaged. Any conflict of interest
between our Controlling Shareholders Group and our other Shareholders may also materially and
adversely affect aspects such as the decision and implementation of our business plans, which may
in turn affect our operations and prospects.
Our historical dividends may not be indicative of our future dividend policy, and there can be
no assurance whether and when we will pay dividends in the future.
We protect our Shareholders’ interest by ensuring a consistent dividend policy. See “Financial
Information — Dividends and Dividend Policy.” However, there is no assurance that dividends of
any amount will be declared or distributed by us in any year in the future. Under the applicable
laws and regulations of mainland China, the payment of dividends may be subject to certain
limitations, and the calculation of our profit under the Accounting Standards for Business
Enterprises may differ in certain respects from the calculation under IFRS. The declaration,
payment and amount of any future dividends are subject to the discretion of our Directors, after
taking into account various factors, including, but not limited to, our results of operations,
financial condition, cash flows, capital expenditure requirements, market conditions, our strategic
plans and prospects for business development, regulatory restrictions on the payment of dividends
and other factors as our Directors may deem relevant, and subject to approval at the general
meeting. Any declaration and payment as well as the amount of dividends will be subject to our
constitutional documents and the applicable laws and regulations of mainland China. No dividend
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shall be declared or payable except out of our profits and reserves lawfully available for
distribution. Our historical dividends should not be taken as indicative of our dividend policy in
the future.
Under the existing foreign exchange regulations of mainland China, payments of current
account items, including profit distributions, interest payments and trade and service-related
foreign exchange transactions, can be made in foreign currencies without prior SAFE approval by
complying with certain procedural provisions. However, approval from or registration with
competent government authorities is required where RMB is to be converted into foreign currency
and remitted out of mainland China to pay capital expenditure such as the repayment of loans
denominated in foreign currencies. If the foreign exchange control system prevents us from
obtaining sufficient foreign currencies to satisfy our foreign currency demands, we may not be
able to pay dividends in foreign currencies to our Shareholders.
Our future financing may cause dilution of your shareholding or place restrictions on our
operations.
In order to raise capital and expand our business, we may consider offering and issuing
additional Shares or other securities convertible into or exchangeable for our Shares in the future
other than on a pro rata basis to our then-existing Shareholders. As a result, the shareholdings of
those Shareholders may experience dilution in net asset value per Share. If additional funds are to
be raised through debt financing, certain restrictions may be imposed on our operations, which
may:
 further limit our ability or discretion to pay dividends;
 increase our risks in adverse economic conditions;
 adversely affect our cash flows; or
 limit our flexibility in business development and strategic plans.
Certain facts, forecasts and other statistics in this Prospectus are derived from official
government sources which had not been independently verified.
This Prospectus, particularly the section headed “Industry Overview” contains information
and statistics relating to the PCB industry in China and globally, as well as other economic data.
Such information and statistics are derived from official government sources, which had not been
independently verified by us, the Sole Sponsor, the Sponsor-Overall Coordinator, the Overall
Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the
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Underwriters, the Capital Market Intermediaries, or any of our or their respective affiliatesor
advisors. You should consider carefully how much weight or importance should be attached to or
placed on such facts or statistics.
Forward-looking statements contained in this document are subject to risks and
uncertainties.
This document contains forward-looking statements with respect to our business strategies,
operating efficiencies, competitive positions, growth opportunities for existing operations, plans
and objectives of management, certain pro forma information and other matters. The words “aim,”
“anticipate,” “believe,” “could,” “predict,” “potential,” “continue,” “expect,” “intend,” “may,”
“might,” “plan,” “seek,” “will,” “would,” “should” and the negative of these terms and other
similar expressions identify a number of these forward-looking statements. These forward-looking
statements, including those relating to our future business prospects, capital expenditure, cash
flows, working capital, liquidity and capital resources are estimates reflecting the best judgment of
our Directors and management and involve a number of risks and uncertainties that could cause
actual results to differ materially from those suggested by the forward-looking statements.
Consequently, these forward-looking statements should be considered in light of various important
factors, including those set out in this section. Accordingly, such statements are not a guarantee of
future performance and investors should not place undue reliance on them.
You should read the entire document carefully and we strongly caution you not to place any
reliance on any information contained in press articles or other media regarding us or our
Shares or the Global Offering.
We strongly caution our investors not to rely on any information contained in press articles or
other media regarding us, our Shares and the Global Offering. Prior to the publication of this
document, there may be press and media coverage regarding the Global Offering and us. Such
press and media coverage may include references to certain information that does not appear in
this document, including certain operating and financial information and projections, valuations
and other information. We have not authorized the disclosure of any such information in the press
or media and do not accept any responsibility for any such press or media coverage or the
accuracy or completeness of any such information or publication. We make no representation as to
the appropriateness, accuracy, completeness or reliability of any such information or publication.
To the extent that any such information is inconsistent or conflicts with the information contained
in this document, we disclaim responsibility for it and our investors should not rely on such
information.
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In preparation for the Global Offering, we have sought the following waivers from strict
compliance with the relevant provisions of the Listing Rules:
MANAGEMENT PRESENCE IN HONG KONG
Pursuant to Rule 8.12 of the Listing Rules, an issuer must have sufficient management
presence in Hong Kong. This will normally mean that at least two of its executive directors must
be ordinarily resident in Hong Kong. Rule 19A.15 of the Listing Rules further provides that the
requirement in Rule 8.12 may be waived by having regard to, among other considerations, the
applicant’s arrangements for maintaining regular communication with the Stock Exchange.
Our Group’s management headquarters, senior management, business operations and assets
are primarily based outside Hong Kong. The Directors consider that the appointment of executive
Director(s) who will be ordinarily resident in Hong Kong would not be beneficial to, or
appropriate for, our Group and therefore would not be in the best interests of our Company or the
Shareholders as a whole. Therefore, our Company does not, and does not contemplate in the
foreseeable future that we will, have sufficient management presence in Hong Kong for the
purpose of satisfying the requirements under the Listing Rules.
Accordingly, pursuant to Rule 19A.15 of the Listing Rules, we have applied for, and the
Stock Exchange has granted, a waiver from strict compliance with Rule 8.12 of the Listing Rules.
We will ensure that there is an effective channel of communication between the Stock Exchange
and us by way of the following arrangements:
(a) pursuant to Rule 3.05 of the Listing Rules, we have appointed and will continue to
maintain two authorized representatives (the “ Authorized Representative(s) ”) who
shall act at all times as the principal channel of communication with the Stock
Exchange. Each of our Authorized Representatives will be readily contactable by the
Stock Exchange by telephone, facsimile and/or e-mail to deal promptly with enquiries
from the Stock Exchange. Both of our Authorized Representatives are authorized to
communicate on our behalf with the Stock Exchange. At present, our two Authorized
Representatives are Mr. YANG Chaohui ( เಃሾ), our executive Director, chairperson of
the Board and general manager, and Ms. ZHOU Yuanyuan ( մᎯᎯ)( “ Ms. Zhou ”), our
joint company secretary. We have also appointed Ms. WONG Nga Sim ( රඩᄬ)( “ Ms.
Wong”), our joint company secretary and who is ordinarily resident in Hong Kong, as
an alternate to the Authorized Representatives.
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
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(b) pursuant to Rule 3.20 of the Listing Rules, each Director will provide their contact
information to the Stock Exchange and to the Authorized Representatives. This will
ensure that the Stock Exchange and the Authorized Representatives should have means
for contacting all Directors promptly at all times as and when required;
(c) we will endeavor to ensure that each Director who is not ordinarily resident in Hong
Kong possesses or can apply for valid travel documents to visit Hong Kong and can
meet with the Stock Exchange within a reasonable period; and
(d) pursuant to Rule 3A.19 of the Listing Rules, we have retained the services of Somerley
Capital Limited as compliance advisor (the “ Compliance Advisor ”), who will act as an
additional channel of communication with the Stock Exchange. We will ensure that the
Compliance Advisor will have access at all times to our Authorized Representatives, our
Directors and other officers. We shall also ensure that such persons will promptly
provide such information and assistance as the Compliance Advisor may need or may
reasonably request in connection with the performance of the Compliance Advisor’s
duties as set forth in Chapter 3A of the Listing Rules. We shall ensure that there are
adequate and efficient means of communication among our Company, our Authorized
Representatives, our Directors, and other officers and the Compliance Advisor, and will
keep the Compliance Advisor fully informed of all communications and dealings
between us and the Stock Exchange.
APPOINTMENT OF JOINT COMPANY SECRETARIES
Pursuant to Rules 3.28 and 8.17 of the Listing Rules, the company secretary must be an
individual who, by virtue of their academic or professional qualifications or relevant experience,
is, in the opinion of the Stock Exchange, capable of discharging the functions of the company
secretary.
Pursuant to Note 1 to Rule 3.28 of the Listing Rules, the Stock Exchange considers the
following academic or professional qualifications to be acceptable:
(a) a member of The Hong Kong Institute of Chartered Secretaries;
(b) a solicitor or barrister as defined in the Legal Practitioners Ordinance (Chapter 159 of
the Laws of Hong Kong); and
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AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
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(c) a certified public accountant as defined in the Professional Accountants Ordinance
(Chapter 50 of the Laws of Hong Kong).
Pursuant to Note 2 to Rule 3.28 of the Listing Rules, in assessing “relevant experience”, the
Stock Exchange will consider the individual’s:
(a) length of employment with the issuer and other issuers and the roles he or she played;
(b) familiarity with the Listing Rules and other relevant laws and regulations including the
SFO, 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 under
Rule 3.29 of the Listing Rules; and
(d) professional qualifications in other jurisdictions.
Our Company appointed Ms. Zhou and Ms. Wong as joint company secretaries of our
Company. For further details, see the section headed “Directors and Senior Management — Joint
Company Secretaries” for their biographies.
Ms. Wong is a Chartered Secretary, a Chartered Governance Professional and an associate of
both The Hong Kong Chartered Governance Institute and The Chartered Governance Institute in
the United Kingdom, 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.
Our Company’s principal business activities are outside Hong Kong. Our Company believes
that it would be in the best interests of our Company and the corporate governance of our Group to
have as its joint company secretary a person such as Ms. Zhou, who is an employee of our
Company and who has day-to-day knowledge of our Company’s affairs. Ms. Zhou has the
necessary nexus to the Board and close working relationship with the management of our
Company in order to perform the function of a joint company secretary and to take the necessary
actions in the most effective and efficient manner.
Accordingly, we have applied for, and the Stock Exchange has granted, a waiver from strict
compliance with the requirements under Rules 3.28 and 8.17 of the Listing Rules for a three-year
period from the Listing Date, in accordance with paragraphs 11 to 17 of Chapter 3.10 of the Guide
for New Listing Applicants, on the conditions that: (i) Ms. Wong is appointed as a joint company
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secretary to assist Ms. Zhou in discharging her functions as a company secretary and in gaining
the relevant experience under Rule 3.28 of the Listing Rules; the waiver will be revoked
immediately if Ms. Zhou is no longer assisted by Ms. Wong who is with qualifications under Rules
3.28 and 8.17 of the Listing Rules, or; and (ii) the waiver will be revoked with immediate effect if
there are material breaches of the Listing Rules by our Company. In addition, Ms. Zhou will
comply with the annual professional training requirement under Rule 3.29 of the Listing Rules and
will enhance her knowledge of the Listing Rules during the three-year period from the Listing
Date. Our Company will further ensure that Ms. Zhou has access to the relevant training and
support that would enhance her understanding of the Listing Rules and the duties of a company
secretary of an issuer listed on the Stock Exchange. Before the expiry of the three-year waiver
period, our Company will evaluate and demonstrate to the Stock Exchange that Ms. Zhou has
acquired the relevant experience required under Rule 3.28 of the Listing Rules, and whether
ongoing assistance should be arranged so that Ms. Zhou’s appointment as the company secretary of
the Company satisfies the requirements under Rules 3.28 and 8.17 of the Listing Rules. We will
seek the Stock Exchange’s confirmation as to whether Ms. Zhou, having benefited from the
assistance of Ms. Wong for the preceding three years, will have acquired the skills necessary to
carry out the duties of company secretary and the relevant experience within the meaning of Note
2 to Rule 3.28 of the Listing Rules so that a further waiver will not be necessary.
CONTINUING CONNECTED TRANSACTIONS
We have entered into certain transactions which will constitute continuing connected
transactions of our Company under the Listing Rules following the completion of the Listing. We
have applied to the Stock Exchange for, and the Stock Exchange has granted, a waiver from strict
compliance with the announcement requirement under the Listing Rules. For further details in this
respect, see the section headed “Connected Transactions.”
DISCLOSURE REQUIREMENTS IN RESPECT OF OUTSTANDING SHARE AWARDS
The Listing Rules and the Companies (Winding Up and Miscellaneous Provisions) Ordinance
prescribe certain disclosure requirements in relation to the Share Awards granted by our Company
(the “ Share Award Disclosure Requirements ”):
(a) Rule 17.02(1)(b) of the Listing Rules stipulates that all material terms of a share scheme
must be clearly set out in this Prospectus. Our Company is also required to disclose in
this Prospectus full details of all outstanding Share Awards and their potential dilution
effect on the shareholdings upon Listing as well as the impact on the earnings per share
arising from the issue of shares in respect of such outstanding Share Awards;
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
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(b) paragraph 27 of Appendix D1A to the Listing Rules requires our Company to set out in
this Prospectus particulars of any capital of any members of our Group that is under
option, or agreed conditionally or unconditionally to be put under option, including the
consideration for which the option was or will be granted and the price and duration of
the option, and the name and address of the grantee; and
(c) paragraph 10 of the Third Schedule to the Companies (Winding Up and Miscellaneous
Provisions) Ordinance requires that our Company shall disclose, inter alia, the number,
description and amount of any shares or debentures of our Company which may be
subscribed for by any person by virtue of an option or a right to acquire an option,
together with the particulars of the option, i.e. (i) the period for which the option is
exercisable; (ii) the price to be paid for the subscription for the shares or debentures
pursuant to the option; (iii) the consideration, if any, paid or to be paid for the
acquisition of the option, or the right to acquire the same; and (iv) the name and address
of the person to whom the option is granted or who is entitled to receive the option or,
in the case of existing shareholders or debenture holders, the Prospectus must specify
the shares or debentures.
Paragraph 6 of Chapter 3.6 of the Guide for New Listing Applicants provides that in general,
the Stock Exchange would grant waivers from disclosing the names and addresses of certain
grantees in the listing document.
As of the Latest Practicable Date, (i) our Company granted Share Awards (i.e., (type II)
restricted share(s), each representing a right to subscribe for one A Share of our Company at the
exercise price upon vesting) under the 2023 Restricted Share Incentive Scheme to subscribe for an
aggregate of 16,800,000 A Shares and the maximum number of Share Awards under the 2023
Restricted Share Incentive Scheme had been granted; and (ii) the total number of A Shares
underlying the outstanding Share Awards which had not been vested (excluding any Share Awards
which have been forfeited, expired or cancelled) under the 2023 Restricted Share Incentive
Scheme amounted to 11,195,298, representing approximately 2.35% of the total issued Shares
immediately following the completion of the Global Offering (assuming the Over-allotment Option
is not exercised and no other changes are made to the issued share capital of our Company
between the Latest Practicable Date and the Listing Date), which will be settled by newly issued A
Shares pursuant to the vesting schedule. Among the Share Awards which had not been vested
(excluding any Share Awards which have been forfeited, expired or cancelled), Share Awards
representing in aggregate 2,814,000 A Shares, 1,587,900 A Shares, 304,180 A Shares and
6,489,218 A Shares were granted to one Director, eight senior management members, three
connected persons and 365 key employees of our Company, respectively, accounting for
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approximately 0.59%, 0.33%, 0.06% and 1.36% of the total issued Shares upon completion of the
Global Offering (assuming the Over-allotment Option is not exercised and no other changes are
made to the issued share capital of our Company between the Latest Practicable Date and the
Listing Date). As of the Latest Practicable Date, none of the grantees of the Share Awards under
the 2023 Restricted Share Incentive Scheme were consultants of our Company. Since each Share
Award entitles the grantee, upon vesting, to subscribe for one A Share of our Company at the
exercise price, each Share Award constitutes an option to acquire one A Share at the exercise price.
We have applied to: (i) the Stock Exchange for a waiver from strict compliance with the
disclosure requirements under Rule 17.02(1)(b) of, and paragraph 27 of Appendix D1A to, the
Listing Rules; and (ii) the SFC for a certificate of exemption under section 342A of the Companies
(Winding Up and Miscellaneous Provisions) Ordinance, exempting our Company from strict
compliance with paragraph 10(d) of the Third Schedule to the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, respectively, on the grounds that strict compliance with the
Share Award Disclosure Requirements would be unduly burdensome for our Company and the
waiver and exemption would not prejudice the interest of the investing public for the following
reasons:
(a) given that over 300 grantees (other than our Directors, senior management and
connected persons) are involved under the 2023 Restricted Share Incentive Scheme,
setting out full details of all the grantees under the 2023 Restricted Share Incentive
Scheme in this Prospectus would be costly and unduly burdensome for our Company in
light of a significant increase in cost and time for information compilation and
Prospectus preparation. For example, the disclosure of personal information of each
grantee may require the consent of all grantees to comply with personal information
privacy laws and principles. Given the number of grantees, obtaining their consent
would cause an unnecessary burden on our Company;
(b) the grant and exercise in full of the Share Awards under the 2023 Restricted Share
Incentive Scheme will not cause any material adverse impact to the financial position of
our Group;
(c) there will not be any new H Shares issued under the 2023 Restricted Share Incentive
Scheme as such scheme is an A Share incentive scheme;
(d) non-compliance with the above Share Award Disclosure Requirements would not prevent
us from providing our potential investors with an informed assessment of the activities,
assets, liabilities, financial position, management and prospects of our Company; and
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
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(e) material information relating to the Share Awards under the 2023 Restricted Share
Incentive Scheme has been disclosed in this Prospectus to provide prospective investors
with sufficient information to make informed decisions.
Therefore, we have applied for, and the Stock Exchange has granted us, a waiver from strict
compliance with the applicable Share Award Disclosure Requirements on the conditions that:
(a) on an individual basis, full details of all outstanding the Share Awards granted by our
Company to our Directors, senior management and connected persons including all the
particulars required under Rule 17.02(1)(b) of the Listing Rules and paragraph 27 of
Appendix D1A to the Listing Rules, and the conditions for the certificate of exemption
under section 342A of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance from strict compliance with paragraph 10(d) of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance, are disclosed in
“Appendix VI — Statutory and General Information — 4. Our Incentive Scheme” to this
Prospectus;
(b) in respect of the outstanding Share Awards granted by the Company to grantees other
than those referred to in sub-paragraph (b) above disclosure is made on an aggregate
basis, categorized into lots based on the total number of Shares underlying each Other
Grantee, being (1) 1 to 9,999; (2) 10,000 to 19,999; and (3) 20,000 to 29,999; (4)
30,000 to 49,999; (5) 50,000 to 99,999; and (6) 100,000 to 300,000 and for each lots of
Shares, with the following details are disclosed in this Prospectus: (i) the aggregate
number of grantees and the number of Shares underlying the Share Awards, (ii) the
consideration paid for the grant of the Share Awards, and (iii) the exercise period and
the exercise price for the Share Awards;
(c) the dilutive effect and impact on earnings per share upon the full exercise of the Share
Awards upon completion of the Global Offering (assuming the Over-allotment Option is
not exercised and no other changes are made to the issued share capital of our Company
between the Latest Practicable Date and the Listing Date) are disclosed in “Appendix VI
— Statutory and General Information — 4. Our Incentive Scheme” to this Prospectus;
(d) the aggregate number of Shares underlying the outstanding Share Awards under the 2023
Restricted Share Incentive Scheme and the percentage to our total issued Shares
represented by such number of Shares upon Listing are disclosed in “Appendix VI —
Statutory and General Information — 4. Our Incentive Scheme” to this Prospectus;
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
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(e) a summary of the principal terms of the 2023 Restricted Share Incentive Scheme is
disclosed in the section headed “Appendix VI — Statutory and General Information —
4. Our Incentive Scheme” in this Prospectus;
(f) the particulars of this waiver are disclosed in this Prospectus;
(g) a full list of all the grantees who have been granted the Share Awards (including the
persons referred to in sub-paragraphs (a) above), containing all the details as required
under Rule 17.02(1)(b) of and paragraph 27 of Appendix D1A to the Listing Rules, and
the conditions for the certificate of exemption under section 342A of the Companies
(Winding Up and MiscellaneousProvisions) Ordinance from strict compliance with
paragraph 10(d) of the Third Schedule to the Companies (Winding Upand Miscellaneous
Provisions) Ordinance, be made available for public inspection in accordance with
“Documents Delivered to the Registrar of Companies and Available on Display” in
Appendix VII to this Prospectus; and
(h) a certificate of exemption under the Companies (Winding Up and Miscellaneous
Provisions) Ordinance from the SFC exempting our Company from strict compliance
with paragraph 10(d) of the Third Schedule to the Companies (Winding Up and
Miscellaneous Provisions) Ordinance having been granted.
We have applied for, and the SFC has granted us, a certificate of exemption under section
342A of the Companies (Winding Up and Miscellaneous Provisions) Ordinance from strict
compliance with paragraph 10(d) of the Third Schedule to the Companies (Winding Up and
Miscellaneous Provisions) Ordinance on the conditions that:
(a) full details of the Share Awards granted by the Company to each of the Directors, senior
management and connected persons are disclosed in “Appendix VI — Statutory and
General Information — 4. Our Incentive Scheme” to this Prospectus, such details to
include all the particulars required under paragraph 10 of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance;
(b) in respect of the outstanding Share Awards granted by the Company to grantees other
than those referred to in sub-paragraph (a) above, disclosure is made on an aggregate
basis, categorized into lots based on the total number of Shares underlying each Other
Grantee, being (1) 1 to 9,999; (2) 10,000 to 19,999; and (3) 20,000 to 29,999; (4)
30,000 to 49,999; (5) 50,000 to 99,999; and (6) 100,000 to 300,000 and for each lots of
Shares, with the following details in this Prospectus: (i) the aggregate number of
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grantees and the number of Shares underlying the Share Awards, (ii) the consideration
paid for the grant of the Share Awards, and (iii) the exercise period and the exercise
price for the Share Awards;
(c) a full list of all the grantees who have been granted the Share Awards (including the
persons referred to in sub-paragraph (a) above) containing all the details as required
under paragraph 10 of Part I of the Third Schedule to the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, be made available for public inspection in
accordance with “Documents Delivered to the Registrar of Companies and Available on
Display” in Appendix VII to this Prospectus; and
(d) the particulars of the exemption are disclosed in this Prospectus, and this Prospectus is
issued on or before January 29, 2026.
ALLOCATION OF H SHARES TO EXISTING MINORITY SHAREHOLDERS AND THEIR
CLOSE ASSOCIATES
Rule 10.04 of the Listing Rules requires that a person who is an existing shareholder of the
issuer may only subscribe for or purchase any securities for which listing is sought which are
being marketed by or on behalf of the issuer either in his or its own name or through nominees if
the conditions in Rules 10.03(1) and (2) of the Listing Rules are fulfilled. It is provided in Rule
10.03(1) of the Listing Rules that no securities may be offered to existing shareholders on a
preferential basis and no preferential treatment may be given to them in the allocation of the
securities; and in Rule 10.03(2) of the Listing Rules that the minimum prescribed percentage of
public shareholders required by Rule 8.08(1) must be achieved.
Paragraph 1C(2) of Appendix F1 to the Listing Rules provides that, without the prior written
consent of the Stock Exchange, no allocations will be permitted to the existing shareholders of the
applicant or their close associates, whether in their own names or through nominees, in the Global
Offering unless the conditions set out in Rules 10.03 and 10.04 of the Listing Rules are fulfilled.
Chapter 4.15 of the Guide for New Listing Applicants provides that the Stock Exchange will
consider granting a waiver from Rule 10.04 of the Listing Rules and a consent, pursuant to
paragraph 1C(2) of Appendix F1 to the Listing Rules, to allow a listing applicant’s existing
shareholders or their close associates to participate in its initial public offering if any actual or
perceived preferential treatment arising from their ability to influence the listing applicant during
the allocation process can be addressed.
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AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
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Prior to the Listing, our Company’s share capital comprises entirely A Shares listed on the
Shenzhen Stock Exchange. As a company listed on the Shenzhen Stock Exchange with its A Shares
publicly traded thereon and with a large public A Shares shareholder base, it would be unduly
burdensome for our Company to seek the prior consent of the Stock Exchange for each of the
minority existing Shareholders or their close associates who subscribe for the H Shares in the
Global Offering.
We have applied for, and the Stock Exchange has granted, a waiver from strict compliance
with Rule 10.04 of, and a consent under paragraph 1C(2) of Appendix F1 to, the Listing Rules to
permit H Shares in the International Offering to be placed to certain existing minority
Shareholders who (i) hold less than 5% of the total number of A Shares in issue of our Company
prior to the completion of the Global Offering and (ii) are not and will not become (upon the
completion of the Global Offering) core connected persons of our Company or the close associates
of any such core connected person (together, the “ Existing Minority Shareholders ” ) ,o nt h e
following conditions:
(i) each Existing Minority Shareholder to whom our Company may allocate the H Shares in
the International Offering holds less than 5% of the total number of A Shares in issue of
our Company before Listing;
(ii) each Existing Minority Shareholder is not, and will not be, a core connected person of
our Company or any close associate of any such core connected person immediately
prior to or following the Global Offering;
(iii) none of the Existing Minority Shareholders has the right to appoint a Director and/or
have any other special rights;
(iv) allocation to the Existing Minority Shareholders or their close associates will not affect
our Company’s ability to satisfy the public float requirement as prescribed by the Stock
Exchange under Rule 8.08 (as amended and replaced by Rule 19A.13A) of the Listing
Rules;
(v) the Sole Sponsor confirms to the Stock Exchange in writing that based on (i) its
discussions with our Company and the Overall Coordinators; and (ii) the confirmations
provided to the Stock Exchange by our Company and the Overall Coordinators
(confirmations (vi) and (vii) mentioned below), and to the best of its knowledge and
belief, it has no reason to believe that any of the Existing Minority Shareholders or their
close associates received any preferential treatment, or is in a position to exert influence
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
–8 8–


--- page 99 ---
on our Company to obtain actual or perceived preferential treatment in the allocation
either as a cornerstone investor or as a placee by virtue of their relationship with our
Company other than the preferential treatment of assured entitlement under a
cornerstone investment following the principles set out in Chapter 4.15 of the Guide for
New Listing Applicants, and details of the allocation to the Existing Minority
Shareholders holding more than 1% of the issued share capital of our Company
immediately prior to the completion of the Global Offering will be disclosed in this
Prospectus and/or the allotment results announcement, as the case may be;
(vi) our Company will confirm to the Stock Exchange in writing that:
a. in the case of participation as cornerstone investors, no preferential treatment has
been, nor will be, given to the Existing Minority Shareholders or their close
associates by virtue of their relationship with our Company, other than the
preferential treatment of assured entitlement under a cornerstone investment
following the principles set out in Chapter 4.15 of the Guide for New Listing
Applicants, nor is the Existing Minority Shareholder in a position to exert
influence on our Company to obtain actual or perceived preferential treatment, and
the Existing Minority Shareholders or their close associates’ cornerstone
investment agreements do not contain any material terms which are more favorable
to the Existing Minority Shareholders or their close associates than those in other
cornerstone investment agreements; or
b. in the case of participation as placees, no preferential treatment has been, nor will
be, given to the Existing Minority Shareholders or their close associates, nor is the
Existing Minority Shareholder in a position to exert influence on our Company to
obtain actual or perceived preferential treatment, by virtue of their relationship
with our Company in any allocation in the placing tranche;
(vii) the Overall Coordinators will confirm to the Stock Exchange that, to their best
knowledge and belief, no preferential treatment has been, nor will be, given to the
Existing Minority Shareholders or their close associates by virtue of their relationship
with our Company in any allocation in the placing tranche, other than the assured
entitlement under a cornerstone investment following the principles set out in Chapter
4.15 of the Guide for New Listing Applicants.
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
–8 9–


--- page 100 ---
WAIVER FROM STRICT COMPLIANCE WITH RULE 4.04(1) OF THE LISTING RULES
AND EXEMPTION FROM STRICT COMPLIANCE WITH SECTION 342(1)(B) IN
RELATION TO PARAGRAPH 27 OF PART I AND PARAGRAPH 31 OF PART II OF THE
THIRD SCHEDULE TO THE COMPANIES (WINDING UP AND MISCELLANEOUS
PROVISIONS) ORDINANCE
Pursuant to Rule 4.04(1) of the Listing Rules, the Accountants’ Report contained in the
prospectus must include, inter alia, the results of our Company in respect of each of the three
financial years immediately preceding the issue of the prospectus or such shorter period as may be
acceptable to the Stock Exchange.
Section 342(1)(b) of the Companies (Winding Up and Miscellaneous Provisions) Ordinance
requires, subject to section 342A of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, all prospectuses to state the matters specified in Part I of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance and set out the reports specified
in Part II of the Third Schedule to the Companies (Winding Up and Miscellaneous Provisions)
Ordinance.
According to paragraph 27 of Part I of the Third Schedule to the Companies (Winding Up
and Miscellaneous Provisions) Ordinance, a company is required to include in the prospectus a
statement as to the gross trading income or sales turnover (as may be appropriate) of the company
during each of the three financial years immediately preceding the issue of the prospectus as well
as an explanation of the method used for the computation of such income or turnover and a
reasonable breakdown of the more important trading activities.
According to paragraph 31 of Part II of the Third Schedule to the Companies (Winding Up
and Miscellaneous Provisions) Ordinance, a company is required to include in the prospectus a
report by auditors of the listing applicant with respect to profits and losses in respect of each of
the three financial years immediately preceding the issue of the prospectus and assets and
liabilities of the listing applicant at the last date to which the financial statements of the listing
applicant were prepared.
Pursuant to section 342A(1)(a) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, the SFC may, subject to such conditions (if any) as the SFC thinks fit, issue a
certificate of exemption from compliance with the relevant requirements under Companies
(Winding Up and Miscellaneous Provisions) Ordinance if, having regard to the circumstances, the
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
–9 0–


--- page 101 ---
SFC considers that the exemption will not prejudice the interest of the investing public and
compliance with any or all of such requirements would be irrelevant or unduly burdensome, or is
otherwise unnecessary or inappropriate.
Chapter 1.1A of the Guide for New Listing Applicants has provided the conditions for
granting a waiver from strict compliance with Rule 4.04(1) of the Listing Rules.
The Accountants’ Report for each of the three years ended December 31, 2024 and the ten
months ended October 31, 2025 has been prepared and is set out in Appendix I to this Prospectus.
Pursuant to the relevant requirements set out above, our Company is required to include three
full years of audited accounts for the three years ended December 31, 2025 in this Prospectus. As
such, an application has been made to the Stock Exchange for a waiver from strict compliance
with Rule 4.04(1) of the Listing Rules, and such waiver has been granted by the Stock Exchange
on the conditions that:
(a) this Prospectus will be issued on or before January 29, 2026 and the H Shares will be
listed on or before March 31, 2026, i.e. three months after the latest financial year-end;
(b) in accordance with Chapter 1.1A of the Guide for New Listing Applicants, a profit
estimate for the financial year ended December 31, 2025 has been included in this
Prospectus, in compliance with Rules 11.17 to 11.19 of the Listing Rules and a
Directors’ statement that there is no material and adverse change to the financial and
trading positions or prospects of our Company, with specific reference to the trading
results from November 1, 2025 to December 31, 2025; and
(c) our Company obtains a certificate of exemption from the SFC on strict compliance with
paragraph 27 of Part I and paragraph 31 of Part II of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance. An application has
also been made to the SFC for a certificate of exemption from strict compliance with the
requirements under section 342(1)(b) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance in relation to paragraph 27 of Part I and paragraph 31 of Part II
of the Third Schedule to the Companies (Winding Up and Miscellaneous Provisions)
Ordinance and a certificate of exemption has been granted by the SFC under section
342A(1)(a) of the Companies (Winding Up and Miscellaneous Provisions) Ordinance on
the conditions that:
(a) the particulars of the exemption are disclosed in this Prospectus;
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
–9 1–


--- page 102 ---
(b) the issuance of the Prospectus on or before January 29, 2026; and
(c) our H Shares will be listed on the Stock Exchange on or before March 31, 2026.
An application has also been made to the SFC for a certificate of exemption from strict
compliance with the requirements under paragraph 27 of Part I and paragraph 31 of Part II of the
Third Schedule to the Companies (Winding Up and Miscellaneous Provisions) Ordinance and a
certificate of exemption has been granted by the SFC under section 342A of the Companies
(Winding Up and Miscellaneous Provisions) Ordinance on the conditions that:
(a) the particulars of the exemption are set out in this Prospectus; and
(b) this Prospectus will be issued on or before January 29, 2026 and H Shares will be listed
on the Stock Exchange on or before March 31, 2026 (i.e. three months after the latest
financial year end of our Company).
The applications to Stock Exchange for a waiver from strict compliance with Rule 4.04(1) of
the Listing Rules and to the SFC for a certificate of exemption from strict compliance with the
requirements under section 342(1)(b) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance in relation to paragraph 27 of Part I and paragraph 31 of Part II of the Third
Schedule to the Companies (Winding Up and Miscellaneous Provisions) Ordinance have been
made on the grounds, among others, that strict compliance with the above requirements would be
unduly burdensome and the waiver and exemption would not prejudice the interests of the
investing public as:
(a) there would not be sufficient time for our Company and the reporting accountants of our
Company (the “ Reporting Accountants ”) to finalize the audited financial statements for
the year ended December 31, 2025 for inclusion in this Prospectus. If the financial
information for the year ended December 31, 2025 is required to be audited, our
Company and the Reporting Accountants would have to carry out substantial volume of
work to prepare, update and finalize the Accountants’ Report and this Prospectus, and
the relevant sections of the Prospectus will need to be updated to cover such additional
period. This would involve additional time and costs since substantial work is required
to be carried out for audit purposes. It would be unduly burdensome for the audited
results for the year ended December 31, 2025 to be finalized in a short period of time.
Our Directors consider that the benefits of such work to the existing and prospective
shareholders of our Company may not justify the additional work and expenses involved
and the delay of the listing timetable;
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
–9 2–


--- page 103 ---
(b) our Directors and the Sole Sponsor confirm, after performing sufficient due diligence
work up to the date of this Prospectus, that there has been no material adverse change to
the financial and trading positions or prospects of the Group since November 1, 2025
(immediately following the date of the latest audited statement of financial position in
the Accountants’ Report set out in Appendix I to this Prospectus) up to the date of this
Prospectus, and there has been no event since November 1, 2025 which would
materially affect the information contained in the Accountants’ Report as set out in
Appendix I to this Prospectus, the financial information section, the profit estimate as
set out in Appendix IIA to this Prospectus and information regarding the Company’s
recent development subsequent to the Track Record Period and up to the date of this
Prospectus;
(c) our Company and the Sole Sponsor are of the view that the Accountants’ Report
covering the three years ended December 31, 2024 and the ten months ended October
31, 2025, together with the profit estimate for the year ended December 31, 2025 (in
compliance with Rules 11.17 to 11.19 of the Listing Rules) included in this Prospectus
have already provided the potential investors with adequate and reasonably up-to-date
information in the circumstances to form a view on the track record and earnings trend
of our Company; and our Directors confirm that all information which is necessary for
the investing public to make an informed assessment of the activities, assets and
liabilities, financial position, trading position, management and prospects has been
included in this Prospectus. Therefore, the waiver and exemption would not prejudice
the interests of the investing public; and
(d) our Company will comply with the requirements under Rules 13.46(2) and 13.49(1) of
the Listing Rules in respect of the publication of our annual results and annual report.
Our Company currently expects to issue our annual results and annual report for the
financial year ended December 31, 2025 on or before March 31, 2026 and April 30,
2026, respectively. In this regard, our Directors consider that the Shareholders, the
investing public as well as potential investors of our Company will be kept informed of
the financial results of our Group for the financial year ended December 31, 2025.
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
–9 3–


--- page 104 ---
DISCLOSURE OF OFFER PRICE
Paragraph 15(2)(c) of Appendix D1A to the Listing Rules provides that the issue price or
offer price of each security must be disclosed in this Prospectus. Pursuant to paragraph 12 of
Chapter 4.14 of the Guide for New Listing Applicants, the Stock Exchange also allows an
indicative offer price range to be included in this Prospectus, as an alternative to the disclosure of
a fixed offer price.
We have applied to the Stock Exchange a waiver from strict compliance with paragraph
15(2)(c) of Appendix D1A to the Listing Rules so that our Company will only disclose the
maximum Offer Price in this Prospectus on the below basis:
(a) the Offer Price will be determined with reference to, among other factors, the closing
price of our A Shares on the Shenzhen Stock Exchange on the last trading day on or
before the Price Determination Date. Our Company is unable to control the trading price
of our A Shares on the Shenzhen Stock Exchange;
(b) setting a fixed offer price or an offer price range with a low-end may adversely affect
our ability to price our H Shares in the best interests of our Shareholders and the market
price of the A Shares and the Offer Shares;
(c) pursuant to paragraphs 9 and 10(b) of the Third Schedule to the Companies (Winding
Up and Miscellaneous Provisions) Ordinance, the amount payable on application and
allotment on each share, and the price to be paid for shares subscribed for, shall be
specified in this Prospectus, respectively. Disclosure of a maximum Offer Price
complies with the requirements prescribed under paragraphs 9 and 10(b) of Part A the
Third Schedule to the Companies (Winding Up and Miscellaneous Provisions)
Ordinance by providing a clear indication of the maximum subscription consideration a
potential investor shall pay for the Offer Shares; and
(d) a maximum Offer Price will be disclosed in this Prospectus. This alternative disclosure
approach would not prejudice the interests of the investing public in Hong Kong.
The Stock Exchange has granted a waiver from strict compliance with paragraph 15(2)(c) of
Appendix D1A to the Listing Rules on the conditions that this Prospectus will disclose:
(a) the maximum Offer Price;
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
–9 4–


--- page 105 ---
(b) the time for the determination of the Offer Price and the form of its publication;
(c) the historical closing prices of our A Shares and trading volume on the Shenzhen Stock
Exchange during the Track Record Period and up to the Latest Practicable Date;
(d) the determinants of the final Offer Price; and
(e) the source for investors to access the latest market price of our A Shares.
See “Structure of the Global Offering — Pricing and Allocation” in this Prospectus for the
historical closing prices of our A Shares and trading volume on the Shenzhen Stock Exchange.
CONSENT IN RESPECT OF THE PROPOSED SUBSCRIPTION OF OFFER SHARES BY A
CORNERSTONE INVESTOR WHO IS A CONNECTED CLIENT
Paragraph 1C(1) of Appendix F1 to the Listing Rules provides that no allocations will be
permitted to “connected clients” of the overall coordinator(s), any syndicate member(s) (other than
the overall coordinator(s)) or any distributor(s) (other than syndicate member(s)) (collectively, the
“Distributors ”, and each a “ Distributor ”), without the prior written consent of the Hong Kong
Stock Exchange.
Paragraph 1B(7) of the Appendix F1 to the Listing Rules states that “connected client” in
relation to an exchange participant means any client which is a member of the same group of
companies as such exchange participant.
CICC Financial Trading Limited (“ CICC FT ”) has entered into a cornerstone investment
agreement with the Company and China International Capital Corporation Hong Kong Securities
Limited (“ CICCHKS ”). CICC FT and China International Capital Corporation Limited will enter
into a series of cross border delta-one OTC swap transactions (collectively, the “ Tibet Longrising
OTC Swaps ”) with each other and the ultimate clients (the “ CICC FT Ultimate Clients (Tibet
Longrising) ”), pursuant to which CICC FT will hold the Offer Shares on a non-discretionary basis
to hedge the Tibet Longrising OTC Swaps while the economic risks and returns of the underlying
Offer Shares are passed to the CICC FT Ultimate Clients (Tibet Longrising), subject to customary
fees and commissions. CICC FT, China International Capital Corporation Limited and CICCHKS,
the Sole Sponsor, Sponsor-Overall Coordinator, one of the Overall Coordinators and Underwriters,
are members of the same group of companies. Accordingly, CICC FT is a connected client of
CICCHKS.
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
–9 5–


--- page 106 ---
We have applied for, and the Stock Exchange has granted, a consent under paragraph 1C(1)
of Appendix F1 to the Listing Rules to permit CICC FT to participate in the Global Offering as a
cornerstone investor on the following basis and conditions as set out in Paragraph 6 of Chapter
4.15 of the Guide:
(a) any Offer Shares to be allocated to CICC FT will be held on behalf of independent third
parties;
(b) the cornerstone investment agreement of CICC FT does not contain any material terms
which are more favorable to CICC FT than those in other cornerstone investment
agreements;
(c) no preferential treatment has been, nor will be, given to CICC FT by virtue of its
relationship with CICCHKS in any allocation of Offer Shares in the International
Offering other than the assured entitlement under the cornerstone investment agreement;
(d) CICC FT confirms that to the best of its knowledge and belief, it has not received and
will not receive any preferential treatment in the allocation of Offer Shares in the Global
Offering by virtue of its relationship with CICCHKS other than the preferential
treatment of assured entitlement as a cornerstone investor;
(e) each of the Company, the Overall Coordinators, CICC FT and CICCHKS has provided
the Stock Exchange with written confirmations in accordance with Chapter 4.15 of the
Guide for New Listing Applicants; and
(f) details of the cornerstone investment and details of the allocations will be disclosed in
this Prospectus and the allotment results announcement of the Company.
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTIONS FROM THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE
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DIRECTORS’ RESPONSIBILITY FOR THE CONTENTS OF THIS PROSPECTUS
This Prospectus, for which our Directors (including any proposed Director who is named as
such in this Prospectus) collectively and individually accept full responsibility, includes particulars
given in compliance with the Hong Kong Listing Rules, the Companies (Winding Up and
Miscellaneous Provisions) Ordinance and the Securities and Futures (Stock Market Listing) Rules
(Chapter 571V of the Laws of Hong Kong) for the purpose of giving information with regard to
our Group. Our Directors, having made all reasonable enquiries, confirm that to the best of their
knowledge and belief, the information contained in this Prospectus is accurate and complete in all
material respects and not misleading or deceptive, and there are no other matters the omission of
which would make any statement herein or this Prospectus misleading.
RESTRICTIONS ON OFFER AND SALE OF H SHARES
Each person acquiring the Hong Kong Offer Shares under the Hong Kong Public Offering
will be required to, or be deemed by his acquisition of Hong Kong Offer Shares to, confirm that he
is aware of the restrictions on the offer and sale of the Hong Kong Offer Shares described in this
Prospectus.
No action has been taken to permit a public offering of the H Shares or the distribution of
this Prospectus in any jurisdiction other than Hong Kong. Accordingly, and 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 for
subscription. The distribution of this Prospectus and the offering and sale of the Offer Shares in
other jurisdictions are subject to restrictions and may not be made except as permitted under the
applicable securities laws of such jurisdictions pursuant to registration with or authorization by the
relevant securities regulatory authorities or an exemption therefrom. In particular, the Offer Shares
have not been publicly offered and sold, and will not be offered and sold, directly or indirectly, in
mainland China or the U.S.
CSRC FILING
We have filed the required documents with the CSRC, and the CSRC has issued the filing
notice dated December 12, 2025, confirming our completion of the filing pursuant to the new
filing regime introduced by the Trial Administrative Measures of Overseas Securities Offering and
Listing by Domestic Companies for the Global Offering and the application for listing of the H
Shares on the Stock Exchange.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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INFORMATION ON THE GLOBAL OFFERING
This Prospectus is published solely in connection with the Hong Kong Public Offering. For
applications under the Hong Kong Public Offering, this Prospectus contains the terms and
conditions of the Hong Kong Public Offering. The Global Offering comprises the Hong Kong
Public Offering of initially 5,045,200 Offer Shares and the International Offering of initially
45,406,600 Offer Shares (assuming the Over-allotment Option is not exercised and subject, in
each, to reallocation on the basis as set out in “Structure of the Global Offering”).
The Offer Shares are offered solely on the basis of the information contained and
representations made in this Prospectus and on the terms and subject to the conditions set out
herein and therein. No person is authorized to give any information in connection with the Global
Offering or to make any representation not contained in this Prospectus, and any information or
representation not contained herein must not be relied upon as having been authorized by our
Company, the Sole Sponsor, the Sponsor-Overall Coordinator, the Overall Coordinators, the Joint
Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Underwriters, the
Capital Market Intermediaries, any of our or their affiliates or any of their respective directors,
officers, employees, advisers, agents or representatives, or any other persons or parties involved in
the Global Offering. Neither the delivery of this Prospectus nor any subscription or acquisition
made under it shall, under any circumstances, create any implication that there has been no change
in our affairs since the date of this Prospectus or that the information in this Prospectus is correct
as of any subsequent time.
UNDERWRITING
The Listing is sponsored by the Sole Sponsor and the Global Offering is managed by the
Sponsor-Overall Coordinator. The Hong Kong Public Offering is fully underwritten by the Hong
Kong Underwriters subject to the terms and conditions of the Hong Kong Underwriting Agreement
and is subject to us and the Sponsor-Overall Coordinator (for itself and on behalf of the
Underwriters) agreeing on the Offer Price. The International Offering is expected to be fully
underwritten by the International Underwriters, subject to the terms and conditions of the
International Underwriting Agreement. See “Underwriting” for further details on the Underwriters
and the underwriting arrangements.
APPLICATION FOR LISTING OF THE H SHARES ON THE HONG KONG STOCK
EXCHANGE
We have applied to the Hong Kong Stock Exchange for the granting of listing of, and
permission to deal in, our 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). Dealings in
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
–9 8–


--- page 109 ---
the H Shares on the Hong Kong Stock Exchange are expected to commence on Friday, February 6,
2026. Except for our A Shares that have been listed on the Shenzhen Stock Exchange and our
pending application to the Hong Kong Stock Exchange for the listing of, and permission to deal in,
the H Shares, no part of our share or debt securities is listed on or dealt in on the Hong Kong
Stock Exchange or any other stock exchange and no such listing or permission to list is being or
proposed to be sought in the near future.
Under section 44B(1) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, any allotment made in respect of any application will be invalid if the listing of, and
permission to deal in, the H Shares on the Hong Kong Stock Exchange is 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 our Company
by or on behalf of the Hong Kong Stock Exchange.
H SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
Subject to the granting of listing of, and permission to deal in, the H Shares on the Hong
Kong Stock Exchange and our 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 Hong Kong
Stock Exchange or any other date as determined by HKSCC. 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 the HKSCC Operational Procedures in effect from time to time. Investors should
seek the advice of their stockbroker or other professional advisers for the details of the settlement
arrangements as such arrangements may affect their rights and interests. All necessary
arrangements have been made for the H Shares to be admitted into CCASS.
H SHARE REGISTER OF MEMBERS AND STAMP DUTY
All of the H Shares issued pursuant to applications made in the Global Offering will be
registered on our H Share register of members to be maintained in Hong Kong by our H Share
Registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road,
Hong Kong. Our principal register of members will be maintained by us at our headquarters in
mainland China.
Dealings in the H Shares registered in our H Share register of members will be subject to
Hong Kong stamp duty.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
–9 9–


--- page 110 ---
DIVIDENDS PAYABLE TO HOLDERS OF H SHARES
Unless determined otherwise by our Company, dividends payable in Hong Kong dollars in
respect of our H Shares will be paid to the Shareholders as recorded on the H Share register of
members of our Company and sent by ordinary post, at the Shareholders’ risk, to the registered
address of each Shareholder of our Company.
PROFESSIONAL TAX ADVICE RECOMMENDED
You should consult your professional advisers if you are in any doubt as to the taxation
implications of subscribing for, purchasing, holding, disposal of, dealing in or the exercise of any
rights in relation to our H Shares. None of our Company, the Sole Sponsor, the Sponsor-Overall
Coordinator, the Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the
Joint Lead Managers, the Underwriters, the Capital Market Intermediaries, any of our or their
affiliates or any of their respective directors, officers, employees, advisers, agents or
representatives, or any other persons or parties involved in the Global Offering accepts
responsibility for any tax effects on, or liabilities of, any person resulting from the subscription,
purchase, holding, disposal of, dealing in, or the exercise of any rights in relation to, our H Shares.
LANGUAGE
If there is any inconsistency between this Prospectus and its Chinese translation, this
Prospectus shall prevail. For ease of reference, the names of the Chinese laws and regulations,
government authorities, institutions, natural persons or other entities (including certain of our
subsidiaries) have been included in this Prospectus in both the Chinese and English languages, and
the Chinese version shall prevail in the event of any inconsistency.
ROUNDING
Certain amounts and percentage figures, such as share ownership and operating data, included
in this Prospectus may have been subject to rounding adjustments. Accordingly, figures shown as
totals in certain tables may not be an arithmetic aggregation of the figures preceding them.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 111 ---
CURRENCY TRANSLATIONS
Solely for your convenience, this Prospectus contains translations among certain amounts
denominated in Renminbi, Hong Kong dollars and U.S. dollars.
Unless otherwise specified, this Prospectus contains certain translations for convenience
purposes at the following rates: Renminbi into Hong Kong dollars at the rate of RMB1.00 to
HK$1.1138, Renminbi into U.S. dollars at the rate of US$1.00 to RMB7.0014 and Hong Kong
dollars into U.S. dollars at the rate of US$1.00 to HK$7.7985.
No representation is made that any amounts in Renminbi, Hong Kong dollars or U.S. dollars
can be or could have been at the relevant dates converted at the above rate or any other rates or at
all.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
– 101 –


--- page 112 ---
DIRECTORS
Name Position Address Nationality
Mr. YANG
Chaohui
(เಃሾ).......
Executive Director Block B, Building 17
Shenye New Coastline
203 South Baoyuan Road
Bao’an District
Shenzhen, Guangdong Province
PRC
Chinese
Mr. ZHANG
Jianqun
(໊).......
Non-executive
Director
Building 2
Yujing Oriental Garden
168 Baishi Road
Nanshan District
Shenzhen, Guangdong Province
PRC
Chinese
Mr. ZHOU
Huiqiang
(մሾ੶).......
Non-executive
Director
Building 9
Tiandi Fengjing Garden
38 Longzhu Boulevard
Nanshan District
Shenzhen, Guangdong Province
PRC
Chinese
Mr. DU Yonggang
(࡝).......
Non-executive
Director
Building C1
Fuyuan Commercial and Residential
Garden
Guihua Road
Futian District
Shenzhen, Guangdong Province
PRC
Chinese
Ms. HUANG
Linting
(ර᜝ణ).......
Non-executive
Director
(Employee
Director)
Building B
Binfen Nianhua Jiayuan
38 East Yiyuan Road
Nanshan District
Shenzhen, Guangdong Province
PRC
Chinese
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 102 –


--- page 113 ---
Name Position Address Nationality
Mr. QIU Yunliang
(˳༶Ԅ).......
Independent
non-executive
Director
Room 1004, Building 3 of Blocks
1-8, Vanke Jinyu Huafu Phase I
East side of Xinqu Boulevard
Minzhi Street, Longhua District
Shenzhen, Guangdong Province
PRC
Chinese
Ms. LI Weiwei
(ҽᑢᑢ).......
Independent
non-executive
Director
34D, Building 7
Shenyun Village
Nanshan District
Shenzhen, Guangdong Province
PRC
Chinese
Dr. XIN Guosheng
(Ԕ਷௷).......
Independent
non-executive
Director
2D, Building 1
Lanxi Valley Phase II, Shekou
Nanshan District, Shenzhen
PRC
Chinese
Ms. XIA Liya
(ᘆඩ).......
Independent
non-executive
Director
Room 1905, Block A
Wah Ming Centre
421 Queens Road
Sai Ying Pun
Hong Kong
Chinese
(Hong
Kong)
See “Directors and Senior Management” for further details.
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
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 103 –


--- page 114 ---
Sponsor-Overall Coordinator China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Overall Coordinators China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Deutsche Bank AG, Hong Kong Branch
60/F, International Commerce Centre
1 Austin Road West
Kowloon
Hong Kong
Joint Global Coordinators and
Joint Bookrunners
China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Deutsche Bank AG, Hong Kong Branch
60/F, International Commerce Centre
1 Austin Road West
Kowloon
Hong Kong
Sinolink Securities (Hong Kong) Company Limited
Unit 3501−08, 35/F
Cosco tower
183 Queen’s Road Central
Sheung Wan
Hong Kong
SDIC Securities (Hong Kong) Limited
39/F, One Exchange Square
Central
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 104 –


--- page 115 ---
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught 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
Deutsche Bank AG, Hong Kong Branch
60/F, International Commerce Centre
1 Austin Road West
Kowloon
Hong Kong
Sinolink Securities (Hong Kong) Company Limited
Unit 3501−08, 35/F
Cosco tower
183 Queen’s Road Central
Sheung Wan
Hong Kong
SDIC Securities (Hong Kong) Limited
39/F, One Exchange Square
Central
Hong Kong
ABCI Securities Company Limited
10/F, Agricultural Bank of China Tower
50 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
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 105 –


--- page 116 ---
Deutsche Bank AG, Hong Kong Branch
60/F, International Commerce Centre
1 Austin Road West
Kowloon
Hong Kong
Sinolink Securities (Hong Kong) Company Limited
Unit 3501−08, 35/F
Cosco tower
183 Queen’s Road Central
Sheung Wan
Hong Kong
SDIC Securities (Hong Kong) Limited
39/F, One Exchange Square
Central
Hong Kong
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
ABCI Securities Company Limited
10/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Legal advisors to our Company As to Hong Kong and U.S. laws:
Clifford Chance
27/F, Jardine House
One Connaught Place
Central
Hong Kong
As to PRC laws:
China Commercial Law Firm
21-26/F, Hong Kong CTS Tower
No. 4011 Shennan Boulevard
Futian District, Shenzhen
PRC
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 106 –


--- page 117 ---
Legal advisors to the Sole Sponsor
and the Underwriters
As to Hong Kong and U.S. laws:
Freshfields
55th Floor, One Island East
Taikoo Place, Quarry Bay
Hong Kong
As to PRC laws:
Han Kun Law Offices
9/F, Office Tower C1, Oriental Plaza
1 East Chang An Ave
Dongcheng District, Beijing
PRC
Independent Auditor and Reporting
Accountants
Ernst & Young
Certified Public Accountants
Registered Public Interest Entity Auditor
27/F One Taikoo Place
979 King’s Road
Quarry Bay
Hong Kong
Industry Consultant China Insights Industry Consultancy Limited
10F, Block B, Jing’an International Center
88 Puji Road
Jing’an District
Shanghai
PRC
Receiving Banks Bank of China (Hong Kong) Limited
1 Garden Road
Hong Kong
CMB Wing Lung Bank Limited
14/F, CMB Wing Lung Bank Building
45 Des V oeux Road
Central
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 107 –


--- page 118 ---
Registered Office No. 101 of Building 3, 1-2/F, 4/F and 7/F of
Building 3, and 1/F and 4/F of Building 4
Han’s Laser Intelligence Manufacturing Center
12 Chongqing Road, Heping Community
Fuhai Street
Bao’an District
Shenzhen, Guangdong Province
PRC
Headquarter and Principal Place of
Business in the PRC
No. 101 of Building 3, 1-2/F, 4/F and 7/F of
Building 3, and 1/F and 4/F of Building 4
Han’s Laser Intelligence Manufacturing Center
12 Chongqing Road, Heping Community
Fuhai Street
Bao’an District
Shenzhen, Guangdong Province
PRC
Principal Place of Business in
Hong Kong
Room 1916, 19/F, Lee Garden One
33 Hysan Avenue, Causeway Bay
Hong Kong
Company’s Website www.hanscnc.com
(The information contained in this website does not
form part of this Prospectus)
Joint Company Secretaries Ms. ZHOU Yuanyuan ( մᎯᎯ)
No. 101 of Building 3, 1-2/F, 4/F and 7/F of
Building 3, and 1/F and 4/F of Building 4
Han’s Laser Intelligence Manufacturing Center
12 Chongqing Road, Heping Community
Fuhai Street
Bao’an District
Shenzhen, Guangdong Province
PRC
CORPORATE INFORMATION
– 108 –


--- page 119 ---
Ms. WONG Nga Sim ( රඩᄬ)
(an associate member of The Hong Kong
Chartered Governance Institute and The Chartered
Governance Institute in the United Kingdom)
Room 1916, 19/F, Lee Garden One
33 Hysan Avenue, Causeway Bay
Hong Kong
Authorized Representatives Mr. YANG Chaohui ( เಃሾ)
Ms. ZHOU Yuanyuan ( մᎯᎯ)
Audit Committee Mr. QIU Yunliang ( ˳༶Ԅ) (chairperson)
Mr. ZHOU Huiqiang ( մሾ੶)
Ms. LI Weiwei ( ҽᑢᑢ)
Remuneration and Appraisal
Committee
Dr. XIN Guosheng ( Ԕ਷௷) (chairperson)
Mr. ZHOU Huiqiang ( մሾ੶)
Mr. QIU Yunliang ( ˳༶Ԅ)
Nomination Committee Ms. LI Weiwei ( ҽᑢᑢ) (chairperson)
Dr. XIN Guosheng ( Ԕ਷௷)
Mr. DU Yonggang (࡝)
Strategy Committee Mr. YANG Chaohui ( เಃሾ)( chairperson )
Mr. ZHANG Jianqun (໊)
Mr. QIU Yunliang ( ˳༶Ԅ)
Compliance Advisor Somerley Capital Limited
20th Floor, China Building
29 Queen’s Road Central
Hong Kong
H Share Registrar Tricor Investor Services Limited
17/F, Far East Finance Centre
16 Harcourt Road
Hong Kong
CORPORATE INFORMATION
– 109 –


--- page 120 ---
Principal Banks Ping An Bank Co., Ltd., Shenzhen Branch
1-2/F, Ping An Bank Building,
1099 Middle Shennan Road, Futian District
Shenzhen, Guangdong Province
PRC
Industrial and Commercial Bank of China
Limited, Central Area of Shenzhen Hi-Tech
Park Branch
South-East corner of
1-2/F, Dazu Technology Center
9988 Shennan Boulevard
Nanshan District
Shenzhen, Guangdong Province
PRC
CORPORATE INFORMATION
–1 1 0–


--- page 121 ---
The information and statistics set out in this section and other sections of this Prospectus
were extracted from the CIC Report prepared by CIC, which was commissioned by us and from
various official government publications and other publicly available publications. We engaged
CIC to prepare the CIC Report, an independent industry report, in connection with the Global
Offering. The information from official government sources has not been independently verified
by any of the Sole Sponsor , the Sponsor-Overall Coordinator , the Overall Coordinators, the
Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Underwriters,
any of their respective directors and advisers, or any other persons or parties involved in the
Global Offering, and no representation is given as to its accuracy.
We primarily engage in the R&D, production and sales of specialized PCB production
equipment. Our products cover nearly all major PCB production processes such as drilling,
photolithography, lamination, formation and testing, making us become the leading player with an
extensive product portfolio in the global specialized PCB equipment industry.
THE SPECIALIZED PCB EQUIPMENT INDUSTRY EMBRACES A NEW ERA OF
INTELLIGENT PRODUCTION
Driven by the rapid development of the infrastructure of AI industrial chain, the global
electronics terminal industry has experienced sustained robust revenue growth from 2023 to 2024,
with servers and data storage devices emerging as the most dynamic segments. As the PCB is the
foundational enablers of modern electronics, surging demand for electronic terminal devices,
combined with continuous functional advancements, has propelled significant growth in PCB
products, while catalyzing a profound transformation within the specialized PCB equipment
industry.
In particular, the increasing demand for high-value PCB products, brought the innovation of
AI-related applications, is driving significant advancements in the precision, efficiency, and
intelligence of specialized PCB production equipment. This trend is further stimulating
technological innovation throughout the specialized PCB equipment industry. In response to the
continuous improvement of AI infrastructure and related industrial chain, the specialized PCB
equipment industry is expected to make continuous advancements in intelligent production,
precision engineering, and high-efficiency production, providing strong momentum for the
industry’s growth and innovation. The following table sets forth the PCB production processes and
required equipment:
INDUSTRY OVERVIEW
– 111 –


--- page 122 ---
Overview of PCB Production Processes (1)
 evisarbA lacimehC
Cleaning Coating Photolithography Developing and Etching
• Chemical Abrasive Cleaning
Equipment  Coating Equipment  Laser Direct Imaging (LDI) System  Developing-Etching-Stripping (DES)
Equipment
Stripping Testing Brown Oxidation Lamination Drilling
Electroless Copper
Deposition
 Stripping Line  Automated Optical Inspection(AOI)
Equipment  Brown Oxide Line
 Cold/Hot Press Machine
 X-Ray Drilling Target Alignment
System
 Laser Drilling Machine
 Mechanical Drilling Machine
 Drill Bit Grinder Equipment
 Plated Through Hole (PTH)
Deposition Line
PhotolithographyRough GrindingCopper Plating
   eniL gnitalP reppoC  Rough Grinding Equipment  LDI System
Developing
 Developing Line
Electroplating
 Vertical Continuous Plating (VCP)
Line
Stripping and Etching
 Etching-Stripping Line
Tin Stripping
 Stripping-Etching-Tin Stripping Line
Testing
 AOI Equipment
Silk Screening
 Silk Screening Equipment
Photolithography
 LDI System
Developing Legend Thermal Curing
 Developing Line  Legend Inkjet Printer  Curing Oven Line
Formation
 Mechanical Formation Machine
 VCUT Beveling Machine
Testing
 Electrical Test Equipment
 Automated Visual Inspection
Equipment
Attachment
(Packaging and Attachment)
 Automated Sorting & Packaging
System
 Attachment equipment
Incoming Material
Major PCB Production Process Note: The related manufacturing equipment
Source: CIC.
Note:
(1) The above processes take the production of multi-layer PCB as an example.
OVERVIEW OF THE SPECIALIZED PCB EQUIPMENT INDUSTRY
Definition and Classification of Specialized PCB Equipment Industry
Compared to the manufacturing processes of other electronic components, PCB production is
distinguished by its multi-stage production processes, stringent precision tolerances, and
adaptability to diverse substrate materials. These characteristics necessitate a highly specialized
production workflow that demands production machinery engineered explicitly for PCB
production. Consequently, the production equipment utilized in PCB production process is
specifically designed in accordance with the technical requirements of PCB production, and is not
applicable to the production of other electronic components. The production equipment involved in
the PCB production process is referred to as specialized PCB production equipment, which denotes
advanced machinery that is purpose-built and custom-designed based on the specific requirements
of PCB production flow, spanning from substrate material processing to the final formation of
finished circuit boards. The term of “Specialized PCB Equipment” is widely accepted in the
industry. For example, relevant industry associations and organizers of electronics trade exhibitions
INDUSTRY OVERVIEW
–1 1 2–


--- page 123 ---
have also adopted this term in their published materials. Specialized PCB production equipment
leverages precision processing and inspection technologies to meet the high precision, operational
stability, and production efficiency across various PCB products and application scenarios.
While there are process variations among different PCB products, the major PCB production
processes encompass photolithography, lamination, drilling, electroplating, formation, testing and
attachment. Each of these processes leverages major specialized PCB production equipment, which
ensure the precision, performance, and reliability of the PCB products and require substantial
capital investment in a PCB production line. The following table sets forth the PCB production
processes and required equipment.
The following table sets forth a description of major specialized PCB production equipment.
Introduction of the Major Specialized PCB Production Equipment
Category Description
/g132The photolithography systems mainly encompass LDI systems that define circuit patterns on
photoresist-coated copper layers, addressing high resolution and alignment accuracy challenges of
PCB production.
/g132The lamination process in PCB production involves bonding multiple double-sided boards or HDI
core layers with prepreg (pre-impregnated material) and copper foil to form a multilayered PCB
structure. . ycnetsisnoclacirtcelednaytirgetnilacinahcemerusnessecorpsihT
/g132The drilling equipment utilizes the advanced laser ablation and mechanical drilling technologies to
fabricate through-holes, blind vias, and microvias, addressing critical interconnect challenges of PCB
production.
/g132The electroplating equipment refers to specialized machinery and systems designed to deposit
metallic layers onto PCB through electrochemical processes. This equipment ensures conductive
pathways, interlayer connectivity, and surface protection by precisely controlling the thickness,
uniformity, and adhesion of metal coatings.
/g132The testing equipment covers utilizes different inspection systems to verify layer alignment,
connectivity, and defect-free circuitry of PCB production.
/g132 noisicerphguorhtBCPf
oserutaeflacinahcemdnaeniltuolanifehtsenifedtnempiuqenoitamrofehT
ssertsdna,gnillimruotnoc,gnittuc- d naycaruccalanoisnemidserusnepetssihT.sessecorpfeiler
compatibility with downstream assembly operations.
/g132 ,esicerpylppaotdengisedsmetsysnoitamotuassecorpdezilaicepsotsrefertnempiuqetnemhcattaehT
reppocotnotsiserotohpmlifyrdfosreyalmrofinu -clad laminate surfaces before photolithography, or
ayalpsmetsysesehT.sdraobtiucricdetnirpelbixelfotnosmlifedimiylopdnasreneffitsdnobot
critical role in electronic manufacturing by ensuring consistent material deposition.
Photolithography
Equipment
Lamination
Equipment
Drilling
Equipment
Testing
Equipment
Formation
Equipment
Attachment
Equipment
Electroplating
Equipment
Source: CIC.
INDUSTRY OVERVIEW
–1 1 3–


--- page 124 ---
Value-Chain of the Specialized PCB Equipment Industry
The specialized PCB equipment industry chain mainly includes:
 Upstream suppliers of the component and material of specialized PCB production
equipment, as well as core technology. The component and material of specialized PCB
production equipment mainly comprises mechanical components, optical components,
control circuits, and advanced materials. The suppliers of core technology provide
automation control, laser technology, and AI data analysis to specialized PCB
production equipment;
 Midstream consists of the specialized PCB production equipment manufacturers
responsible for the R&D, production and sales of specialized PCB production
equipment; and
 Downstream participants of the industry primarily comprise PCB production
manufacturers, which are considered as the direct customer of the specialized PCB
production equipment manufacturers and provide multiple types of PCB products to
various application scenarios, such as server and storage, automotive electronics, mobile
phones, computers, consumer electronics, and others. Given the high technology barrier
for PCB production, leading specialized PCB production equipment manufacturers are
adopting vertical integration strategies to enhance their technological ecosystems. It has
become an industry standard practice for specialized PCB production equipment
manufacturers to procure core components from upstream suppliers, who also
simultaneously purchase PCB production equipment from these manufacturers.
INDUSTRY OVERVIEW
–1 1 4–


--- page 125 ---
The following table sets forth a description of the value chain of the specialized PCB
equipment industry:
Value Chain of the Specialized PCB Equipment Industry
Midstream
Specialized PCB Production Equipment
Manufacturers
Upstream Downstream
Direct Customers
…
PCB Manufacturers
1 2 3
…
Component and Material Suppliers
The Core Technology Suppliers
Mechanical Components
Optical Components
Control Circuits
Advanced Materials
Automation
control
Laser
technology
AI data
analysis
Application
Scenarios
Server / Storage
Automotive
Electronics
Mobile Phone
Computers
Other Consumer
Electronics
…
…
Photolithography Equipment
Lamination Equipment
Drilling Equipment
Electroplating Equipment
Testing  Equipment
Formation Equipment
Attachment Equipment
Source: CIC.
With the continued acceleration of the AI technologies and automotive intelligence, the global
PCB industry experienced a stable increase in market demand in 2024. The global PCB industry
output value, which refers to the total market value of PCB products, increased from US$65.2
billion in 2020 to US$73.6 billion in 2024, with a CAGR of 3.1% from 2020 to 2024. The global
PCB industry output value is expected to reach US$96.4 billion in 2029, representing a CAGR of
5.3% from 2025 to 2029. The fast growth of end-use applications is directly driving the upgrade
and replacement of production equipment. Scenarios such as the increasing electrification of smart
vehicles, surging demand for high-performance servers, and the functional upgrade of consumer
electronics are placing higher demands on PCBs in terms of reliability, miniaturization, and
integration. Traditional specialized PCB production equipment can no longer meet the
requirements of these advanced processes, compelling enterprises to adopt more advanced,
high-performance specialized PCB production equipment. Furthermore, leading global PCB
manufacturers are accelerating capacity expansion, further fueling demand for specialized PCB
production equipment. The global PCB output value declined by 15% in 2023 compared to 2022,
primarily due to a contraction in demand from the consumer electronics sector, which is a major
end-use application for PCB products. For instance, PCB output value for mobile phones decreased
from US$15.8 billion in 2022 to US$13.1 billion in 2023, representing a decrease of 17.1%, while
the global PCB output value of computer decreased from US$17.6 billion in 2022 to US$13.1
billion in 2023.
INDUSTRY OVERVIEW
–1 1 5–


--- page 126 ---
The following table sets forth a breakdown of the industry output value, which refers to the
total market value of PCB products, by major application type from 2020 to 2029.
Global PCB Industry Output Value, by Major Applications, 2020–2029E
14.4 17.9 19.1 16.9 17.5 18.4 19.4 20.3 21.2 22.1
9.4
11.8 11.3 9.1 9.0 9.4 9.8 10.1 10.4 10.6
15.0
19.2 17.6
13.1 13.1 13.7 14.3 14.8 15.3 15.8
14.2
16.0 15.8
13.1 13.9 14.9 15.8 16.5 17.3 18.0 6.5
8.2 9.4
9.2 9.2 9.9 10.5 11.2 11.8 12.4
5.9
7.8 8.6
8.2 10.9
12.2
13.6
15.1
16.3 17.6
0
10
20
30
40
50
60
70
80
90
100
110
120
130
2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E
65.2
80.9 81.7
69.5
73.6
78.6
83.4
88.0
92.3
96.4
USD Billion
CAGR
CAGR20-24 CAGR25E-29E
3.1% 5.3%
16.7% 9.5%
9.2% 5.8%
-0.5% 4.7%
-3.4% 3.7%
-1.1% 3.1%
5.1% 4.6%
Total
Server/Storage
Automotive Electronics
Mobile Phone
Computers
Other Consumer Electronics
(1)
Others(2)
Sources: Prismark, CIC.
Notes:
(1) Consumer electronics refer to mass-produced electronic devices designed for personal, household, or recreational
use. These products are intended to enhance convenience, entertainment, communication, and daily living. Other
consumer electronics mainly refer to audio-visual equipment, home appliances, wearables and etc..
(2) Others including wired and wireless communication infrastructure, industrial products, medical and aerospace.
MARKET SIZE OF SPECIALIZED PCB EQUIPMENT INDUSTRY
Market Size of Global Specialized PCB Equipment Industry
The main development region for specialized PCB production equipment include China,
Taiwan China, Japan, South Korea and Americas, which together accounted for approximately
89.5% of global market size as of 2024. From 2020 to 2024, these regions recorded a CAGR of
5.6%, 4.6%, 0.9%, 2.1% and 6.2%, respectively. The global specialized PCB equipment industry is
undergoing a strategic shift towards emerging markets, with Southeast Asia market as the major
hub for this transition. The market size of the specialized PCB equipment in Southeast Asia
increased from approximately US$403 million in 2020 to approximately US$586 million in 2024,
representing a CAGR of 9.8% from 2020 to 2024. This shift is driven by cost competitiveness,
favorable trade policies, and regional supply chain resilience, propelling the specialized PCB
INDUSTRY OVERVIEW
–1 1 6–


--- page 127 ---
equipment market in Southeast Asia and other emerging market to achieve faster growth in the
coming future. The market size of the specialized PCB equipment in Southeast Asia is expected to
reach US$1,262 million in 2029, reflecting a CAGR of 15.5% from 2025 to 2029.
The global market size of the specialized PCB equipment increased from approximately
US$5,840 million in 2020 to approximately US$7,085 million in 2024, representing a CAGR of
4.9%, and is projected to reach approximately US$11,388 million in 2029 at a CAGR of 8.6%
from 2025 to 2029. As an important part of the global PCB industry, the market size of China’s
specialized PCB equipment industry increased from approximately US$3,306 million in 2020 to
approximately US$4,111 million in 2024, representing a CAGR of 5.6% from 2020 to 2024, and
the market size of China’s specialized PCB equipment industry is projected to grow at a CAGR of
8.2% from 2025 to 2029, reaching approximately US$6,495 million by 2029.
The following table sets forth a breakdown of the market size, measured by revenue, of
global specialized PCB equipment market by region from 2020 to 2029.
Market Size of Global Specialized PCB Equipment, by Region, in Terms of Revenue,
2020−2029E
CAGR
CAGR20-24 CAGR25E-29E
4.9% 8.6%
5.6% 8.2%
4.6% 7.7%
0.9% 7.6%
2.1% 7.0%
6.2% 8.1%
9.8% 15.5%
0.5% 6.5%
551 456 521 586 708 846 986 1,125 1,262
420 456 489 516
517 557 606 568 562 641 704 758 804 840
616 705 753 630 639 738 815 882 940 987
579 667 675 645 693
790
881 963 1,036 1,0643,306
3,820 3,874 3,674 4,111
4,747
5,264
5,723
6,121
6,495
0
1,500
3,000
4,500
6,000
7,500
9,000
10,500
12,000
403155
2020
262
154
2021
280
157
2022
300
162
2023
336
158
2024
378
175
2025E
264
2026E
204
2027E
216
2028E
224
2029E
5,840
6,716 6,802 6,500
7,085
8,176
9,120
9,973
10,729
11,388
191
China
Taiwan, China
South Korea
Japan
Americas
Southeast Asia
Others
USD Million
Total
Sources: Prismark, CIC.
INDUSTRY OVERVIEW
–1 1 7–


--- page 128 ---
The specialized PCB equipment market is undergoing a technology-driven transformation,
characterized by precision upgrades, intelligent automation and capital intensity escalation, further
accelerated by breakthroughs in AI technologies and automotive intelligence applications. This
trend is expected to accelerate the market development and drive the market size of the specialized
PCB equipment to reach approximately US$11,388 million by 2029, representing a CAGR of 8.6%
from 2025 to 2029. The following table sets forth a breakdown of the market size, measured by
revenue, of global specialized PCB equipment market by equipment type from 2020 to 2029.
Market Size of Global Specialized PCB Equipment, by Equipment Type,
in Terms of Revenue, 2020-2029E
CAGR
CAGR20-24 CAGR25E-29E
4.9% 8.6%
5.8% 11.5%
5.7% 9.3%
6.8% 8.6%
8.2% 8.8%
6.1% 8.2%
7.6% 8.7%
3.6% 6.7%
0.9% 5.8%
1,567 1,639 1,635 1,514 1,622 2,017 2,205 2,359 2,481 2,528
616
700 774 838 892 979
383 396 378 415
476 531 579 619 653
480 483 459 508
590
664 728 781 826
818
947 966 929 1,063
1,226
1,374
1,502
1,612 1,704
964
1,121 1,148 1,109
1,204
1,222
1,350
1,480
1,612
1,743
1,174
1,397 1,408 1,380
1,470
1,735
1,994
2,241
2,472
2,683
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
11,000
12,000
162
2020 2021 2022 2023
187
2024
209
2025E
229
2026E
246
2027E
260
2028E
272
2029E
5,840
6,716 6,802 6,500
7,085
8,176
459
9,973
10,729
11,388
327
370
9,120
571
181
586
171
559179
Drilling Equipment
Photolithography Equipment
Testing Equipment
Electroplating Equipment
Lamination Equipment
Formation Equipment
Attachment Equipment
Others
Total
USD Million
Source: Prismark, CIC.
Drilling equipment and photolithography equipment are two categories of specialized PCB
equipment with relatively high value and critical importance within the overall production process,
Such significance is primarily attributable to the characteristics of the corresponding processes of
PCB production. Unlike other specialized PCB equipment, drilling and photolithography
equipment feature higher usage frequency and amount in terms of number of units of equipment
required during the PCB production process compared to other specialized PCB production
equipment. Consequently, the capital expenditure allocated to drilling and photolithography
equipment in a single PCB production line accounts for over 30% of the total investment of
specialized PCB production equipment.
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Driven by both technological advancements in PCB products and the expansion of
downstream application scenarios, the growth potential for drilling and photolithography
equipment markets is expected to further expand. As PCBs evolve toward higher density and layer
counts, market demand for high-end PCB products such as high-multilayer boards and HDI boards
continues to grow, imposing escalating requirements on the quantity and precision of drilling and
photolithography equipment in their production processes.
Drilling Equipment
The global market size of the drilling equipment increased from approximately US$1,174
million in 2020 to approximately US$1,470 million in 2024, representing a CAGR of 5.8%, and is
projected to reach approximately US$2,683 million at a CAGR of 11.5% from 2025 to 2029. The
criticality of the drilling equipment lies in the mechanics of PCB signal transmission, which
depends on interlayer vias. As PCBs evolve to accommodate more layers and higher via densities,
the number of holes per board increases significantly. Drilling equipment is tasked with executing
multiple high-precision operations on each board to create these vias. Consequently, as layer
counts and via densities rise, the demand for drilling per PCB grows exponentially. To maintain
production capacity, this escalating requirement necessitates the deployment of multiple drilling
units operating in parallel within a single production line. The following table sets forth a
breakdown of the market size, measured by revenue, of global drilling equipment market by region
from 2020 to 2029.
Market Size of Global Drilling Equipment, by Region, in Terms of Revenue, 2020–2029E
CAGR
CAGR20-24 CAGR25E-29E
5.8% 11.5%
5.9% 11.6%
5.3% 10.3%
1.7% 12.0%
3.0% 9.4%
7.1% 11.0%
17.9% 16.5%
93 105 124 144 177 19392 103 113 122
104 116 125 121 117 148 169 190 194 213
124 147 156 134 133 154 179 201 222 243
185 217 219 214 228
266
303
336
367 394
660
789 795 780 831
980
1,127
1,268
1,398
1,518
0
300
600
900
1,200
1,500
1,800
2,100
2,400
2,700
48
2020
54
2021
5855
2022
6468
2023
70
2024 2025E 2026E
53
2028E 2029E
1,174
1,397 1,408 1,380
1,470
1,735
1,994
2,241
2,472
2,683
74
80
2027E
China
South Korea
Americas
Taiwan, China
Others
Japan
Total
USD Million
Source: Prismark, CIC.
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Photolithography Equipment
The global market size of the photolithography equipment increased from approximately
US$964 million in 2020 to approximately US$1,204 million in 2024, representing a CAGR of
5.7%, and is projected to grow at a CAGR of 9.3% from 2025 to 2029, reaching approximately
US$1,743 million by 2029. The growth of the market is mainly driven by the importance of
photolithography equipment in a PCB production line. Firstly, each layer of PCB circuitry
demands independent exposure to ensure precise pattern transfer. Additionally, HDI boards require
multi-layer interconnection and additional exposure steps after single-layer processing to meet
stringent production specifications. These dual demands ensure photolithography equipment’s
irreplaceable function in enabling complex PCB production process.
The following table sets forth a breakdown of the market size, measured by revenue, of
global photolithography equipment market by region from 2020 to 2029.
Market Size of Global Photolithography Equipment, by Region, in Terms of Revenue,
2020–2029E
CAGR
CAGR20-24 CAGR25E-29E
5.7% 9.3%
5.7% 9.4%
7.9% 6.8%
1.8% 7.9%
3.1% 7.4%
7.3% 7.6%
6.6% 16.5%
7 9% 6 8%
92 118 103 116 119 123 146 168 192 22759 62 68 74 79
85 93 102 97 96 97 105 114 122 129
102 118 127 107 109 111 122 132 142 151
196
231 236 223 266 271
300
324
341
353445
518 531 514
556 560
615
674
740
804
0
300
600
900
1,200
1,500
1,800
43
2020
44
2021
47
2022
51
2023
58
2024 2025E 2026E 2027E 2028E 2029E
964
1,121 1,148 1,109
1,204 1,222
1,350
1,480
1612
1,743
China
Taiwan, China
South Korea
Japan
Americas
Others
USD Million
Total
Source: Prismark, CIC.
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Market Size of China’s Specialized PCB Equipment Industry
The market size of the specialized PCB equipment in China increased from approximately
US$3,306 million in 2020 to approximately US$4,111 million in 2024, representing a CAGR of
5.6% from 2020 to 2024, and the market size of the specialized PCB equipment in China is
expected to reach approximately US$6,495 million in 2029, representing a CAGR of 8.2% from
2025 to 2029.
The following table sets forth a breakdown of the market size, measured by revenue, of
China’s specialized PCB equipment market by equipment type from 2020 to 2029.
Market Size of China’s Specialized PCB Equipment, by Equipment Type, in Terms of
Revenue, 2020–2029E
CAGR
CAGR20-24 CAGR25E-29E
5.6% 8.2%
5.9% 11.6%
5.7% 9.4%
7.5% 8.8%
8.7% 8.6%
11.2% 8.9%
6.3% 8.4%
3.7% 7.6%
2.6% 4.6%
7 5% 8 8%
1,114 1,200 1,201 1,075 1,246 1,509 1,624 1,705 1,751 1,808
202
243 272 297 318 336
215 217 225
254
295
332 364 392 415
309
389 404 386
431
489
544
595 641 682
366
425 435 418
489
566
636
697
749
793
445
518 531
514
556
560
615
674
740
804
660
789 795
780
831
980
1,127
1,268
1,398
1,518
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
79
2020 2021
89
2022 2023 2024 2025E 2026E
123
2027E
132
2028E
139
2029E
3,306
3,820
166
3,674
4,111
4,747
5,264
5,723
6,121
6,495
166
87 195
84
92
103212
114
193
3,874
Drilling Equipment
Photolithography Equipment
Testing Equipment
Electroplating Equipment
Lamination Equipment
Formation Equipment
Attachment Equipment
Others
Total
USD Million
Source: Prismark, CIC.
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DRIVERS AND TRENDS OF THE SPECIALIZED PCB EQUIPMENT INDUSTRY
The following outlines key factors that have driven and are expected to drive the growth of
the global specialized PCB equipment market, along with the future trends shaping the further
development:
 Surging Demand for High-Precision Equipment: Driven by the continued adoption of
generative AI, physical AI, and 5G, there is growing demand for high-value PCB
products, such as high-multilayer boards, HDI boards, packaging substrates and
multi-layer FPCs, across applications such as AI servers, autonomous driving computing
modules, AI-powered smartphones, and optical transceivers. These advanced
applications are accelerating the shift toward high-density and multilayer PCB
architectures, raising precision requirements for equipment such as drilling machines to
the micron level. Consequently, high-precision systems, including laser drilling
equipment, are becoming core systems in modern PCB production.
 Strong Policy Support from National Industrial Initiatives: As a foundational pillar of
modern electronics production, PCB specialized equipment embodies the convergence of
multidisciplinary technologies spanning mechanical systems, electrical engineering,
optical precision, advanced control systems, and materials science. Recognized as a
strategic priority within China’s high-end equipment production road map, this sector
has received substantial policy reinforcement in recent years. Major national initiatives,
including 14th Five-Year Plan for Intelligent Manufacturing Development, have
significantly emphasized governmental support for indigenous R&D breakthroughs,
technological upgrading, and domestic substitution of critical electronic production
equipment. These concerted efforts are not merely propelling technological innovation
but are strategically accelerating the industry’s evolution toward greater supply chain
autonomy and high-quality development anchored in sustainable competitiveness.
Furthermore, the plan explicitly calls for promoting the development of key strategic
emerging industries such as electronic information, high-end equipment, new energy
vehicles, and aerospace, which further unleashes downstream demand for high-end PCB
products. This is expected to drive the expansion and upgrading of the specialized PCB
equipment market. Additionally, the plan emphasizes the construction of smart factories
and digital workshops, encouraging the introduction of automated and intelligent
equipment in key manufacturing processes. This is likely to generate increased demand
for high-end specialized PCB equipment during the digital and intelligent transformation
of PCB manufacturers.
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 PCB Production Capacity Expansion Drives Equipment Demand Surge: Fueled by
robust downstream demand in sectors such as AI, high-end consumer electronics, and
NEVs, the global electronics production supply chain is undergoing accelerated
geographic consolidation, with China and Southeast Asia emerging as dominant strategic
nodes in this structural realignment. As production capacity for PCB expands, demand
for specialized PCB production equipment has increased accordingly. The surge in
equipment replacement across critical PCB production steps (photolithography,
lamination, drilling, formation and testing) and the scale of equipment procurement in
Southeast Asia’s greenfield projects reflect transformative trends driven by technological
advancement, regional industrialization, and market expansion.
 Accelerated Equipment Export Driven by Global Supply Chain Restructuring:
Geopolitical tensions and evolving trade protection policies are driving PCB production
relocation to cost-competitive regions such as Southeast Asia. In response, specialized
PCB production equipment manufacturers must adapt to varying regional standards,
prompting the development of modular, easy-to-maintain, and customized solutions for
specialized PCB production equipment.
 Ongoing Improvement in the International Competitiveness of China’s Specialized
PCB Production Equipment: China’s specialized PCB production equipment is rapidly
enhancing its global competitiveness through technological advancement and industrial
upgrading. Supported by favorable policies and accumulated expertise, China’s
specialized PCB production equipment is expected to be widely accepted and acquire
additional market share in the global high-end market. This development will
significantly enhance China’s specialized PCB production equipment’s influence in the
global PCB industry.
 PCBs in AI-related sectors are expected to become a key growth driver over the next
few years, significantly boosting demand for high value-added production equipment:
With the rapid advancement of AI large models and intelligent hardware applications,
demand for computing infrastructure is surging, which in turn is driving substantial
growth in demand for high-performance servers, GPUs, and advanced PCBs. AI-specific
devices place higher requirements on PCBs such as increased layer counts,
high-frequency and high-speed signal transmission, and precision production thus
accelerating the demand for high-end, value-added PCB products. This trend is
expanding the market for specialized PCB equipment.
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COMPETITIVE LANDSCAPE OF THE SPECIALIZED PCB EQUIPMENT INDUSTRY
The global specialized PCB equipment industry exhibits a relatively fragmented competitive
landscape, with the top five global market players collectively accounting for approximately 20.9%
of the total market share in terms of revenue in 2024. The key market players include well-known
electronics instrumentation manufacturers that also supply specialized PCB production equipment,
alongside market participants that similar to us that are dedicated to the development of the
specialized PCB production equipment. We rank the first among all specialized PCB production
equipment manufacturers globally in terms of sales revenue in 2024, capturing approximately 6.5%
of the global market. The following table sets forth the key players in global specialized PCB
equipment industry in 2024.
Top 5 Specialized PCB Production Equipment Manufacturers by Revenue, Global, 2024
Ranking Company Description Revenue(1)
(RMB billion) Market Share
1 Our Group
 Our Group is a solutions provider of specialized PCB production equipment.
We have a product portfolio, covering nearly all major PCB production processes
such as drilling, photolithography, lamination, formation and testing.
3.3 6.5%
2 Competitor A

~2.5 4.9%
3 Competitor B

~2.0 3.9%
4 Competitor C

~1.5 2.9%
5 Competitor D
 Headquartered in the Germany, Competitor D is primarily engaged in the development of
high-precision mechanical drilling machines, laser cutting equipment, and metrology systems.
Competitor D is a privately held company.
~1.4 2.7%
Total of the top five companies ~10.7 20.9%
Headquartered in Japan, Competitor A has a history of over a century in operations, primarily
focusing on automotive electronics, telecommunications equipment, and industrial automation
applications. Competitor  A is listed on the Tokyo Stock Exchange. In the global specialized PCB
equipment market, Competitor  A engages in the R&D, production, and sales of drilling
equipment, which are primarily used in the HDI board and IC packaging substrate markets.
Headquartered in the United States, Competitor B is a leading player in the advancing
electronics industry through its expertise in semiconductor process control and the production of
high-precision electronics equipment. Competitor B was listed on the NASDAQ. In the global
specialized PCB equipment market, the Competitor B mainly provides AOI equipment and LDI
systems for global customers.
Headquartered in the United States, Competitor C is a leading provider of foundational
technology solutions for advanced semiconductor production, electronics and packaging, as well
as specialized industrial applications. Competitor C was listed on the NASDAQ. In the global
specialized PCB equipment market, Competitor C mainly provides laser drilling equipment for
global customers.
Sources: Annual reports of companies pursuant to laws and regulations of where their shares were listed, CPCA, CIC.
Note:
(1) Represents global revenue in 2024.
The specialized PCB equipment industry in China remains characterized by a fragmented
competitive landscape, with the top five domestic manufacturers collectively holding
approximately 23.9% of the total market share in 2024. Within this decentralized environment, we
emerged as the market leader, ranking first among specialized PCB production equipment
manufacturers in China by sales revenue in 2024, capturing approximately 10.1% of the domestic
market. China’s specialized PCB equipment sector commands a major position globally. In 2024,
the market size of China’s specialized PCB equipment industry accounted for approximately 58%
INDUSTRY OVERVIEW
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of the global market, and this share is expected to remain stable at 57% in 2029 despite the
development of other emerging markets. Owing to this critical global role, leading specialized
PCB production equipment manufacturers in China continue to reinforce their global competitive
advantages. The following table sets forth the key players in specialized PCB equipment industry
in China in 2024.
Top 5 Specialized PCB Production Equipment Manufacturers by Revenue, China, 2024
Ranking Company Description Revenue(1)
(RMB billion) Market Share
1 Our Group
 Our Group is a solutions provider of specialized PCB production
equipment. We have a product portfolio, covering nearly all major PCB production
processes such as drilling, photolithography, lamination, formation and testing.
3.0 10.1%
2 Competitor A

~1.5 5.1%
3 Competitor E  ~1.3 4.4%
4 Competitor F
 Headquartered in China, Competitor F is a high-end equipment production company
specializing in the research, development, and production of direct imaging and maskless
lithography equipment. Competitor F was listed on the Shanghai Stock Exchange.
~0.8 2.6%
5 Competitor G
 Headquartered in China, Competitor G specializes in the research and development,
design, production, and sales of high-end precision electroplating equipment and
its supporting systems. Competitor G was listed on the Shanghai Stock Exchange.
~0.5 1.7%
Total of the top five companies ~7.1 23.9%
Headquartered in Japan, Competitor A has a history of over a century in operations, primarily
focusing on automotive electronics, telecommunications equipment, and industrial automation
applications. Competitor A is listed on the Tokyo Stock Exchange. In the global specialized
PCB equipment market, Competitor A engages in the R&D, production, and sales of drilling
equipment, which are primarily used in the HDI board and IC packaging substrate markets.
Headquartered in China, Competitor E has over 36 years of industry experience and mainly
provides chemical wet process equipment, such as electroplating and etching equipment.
Source: Annual reports of companies pursuant to laws and regulations of where their shares were listed, CPCA, CIC.
Note:
(1) Represents revenue in China in 2024.
Entry Barriers and Key Success Factors for the Specialized PCB Equipment Industry
 Technological Barriers: To achieve high precision, multi-functionality, and rapid iteration,
specialized PCB production equipment manufacturers must establish solid technological
barriers. Building these barriers relies on continuous R&D investment, the accumulation of
experience by core teams, and strategic patenting. As market demand for high precision
equipment continues to rise, manufacturers with strong technological barriers will be able to
meet the increasing demands of downstream clients for high-quality, reliable equipment,
thereby gaining a competitive edge.
 Product Portfolio Barriers: PCB production involves multiple steps that require the
coordination and integration of specialized equipment. To meet diverse customer needs and
enhance market competitiveness, equipment suppliers must establish a comprehensive and
diversified product portfolio covering various stages of the PCB production process. By
INDUSTRY OVERVIEW
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continuously optimizing and expanding their product lines, suppliers can meet diverse market
demands, offer more convenient integrated services, reduce procurement and production costs
for clients, and improve the customer experience.
 Capital Barriers: To meet the ever-increasing demands for precision, efficiency, and
automation in PCB production processes, specialized PCB production equipment suppliers
should make sustained, large-scale investments in core technology development and iterative
upgrades. In addition, leading PCB manufacturers impose stringent requirements on suppliers
regarding qualifications, operational stability, and after-sales service capabilities. The
specialized PCB production equipment supplier validation process often involves several
months — or even years — of testing and evaluation, placing significant pressure on a
supplier’s cash flow and long-term operational resilience.
 Customer Resource Barriers: In the PCB production industry, large customers have
extremely high requirements for equipment quality, delivery times, and after-sales service.
Once equipment suppliers gain the trust of these customers through reliable product
performance and in-depth, tailored services, they establish a strong customer resource barrier.
This trust not only secures long-term orders but also enhances brand influence through
word-of-mouth marketing, leading to more business opportunities in the market.
Analysis of Raw Material Prices in China’s Specialized PCB Equipment Industry
Laser equipment, spindles, and motion control systems constitute the foundational raw
materials for specialized PCB production equipment. Laser equipment serves as the primary energy
mechanism for drilling equipment, enabling ultra-precision microvia formation. Spindles are
critical for maintaining rotational stability during drilling process, directly impacting hole wall
integrity by minimizing defects such as burring or delamination, particularly in HDI and IC
substrate manufacturing. Motion control systems facilitate coordinated multi-axis movement,
thereby reducing deviation in drilling trajectories. Historically, these raw materials were
predominantly supplied by overseas manufacturers. However, accelerated localisation in China,
driven by domestic technological advancements and supply chain resilience efforts, has
significantly reduced dependency. Consequently, price fluctuations for these raw materials are
influenced by macroeconomic conditions, localisation process, and supply-demand dynamics of
critical components. The prices of laser equipment, spindles, and motion control
systems demonstrated a general upward trend from 2020 to 2022, peaking in 2022. This increase
was primarily attributed to induced supply chain disruptions due to COVID-19, including
prolonged material delivery delays and factory shutdowns, that constrained global supply. Unlike
spindles and motion control systems, whose prices began a gradual decline after 2022, the price of
laser equipment rose by 8.4% in 2023 compared to 2022. This divergence was driven by global
supply constraints of laser components. Looking ahead, as supply-demand dynamics gradually
INDUSTRY OVERVIEW
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stabilize and localisation accelerates, the prices of these core raw materials for China’s specialized
PCB production equipment are expected to exhibit a downward trend. These components are often
customized to meet highly specialized specifications, resulting in pricing structures that vary
significantly based on precision requirements, technical complexity, and application-specific
adaptations. Unlike standardized commodities with fixed pricing models, the cost of such
equipment is dictated by bespoke engineering solutions rather than bulk market dynamics.
Potential pricing fluctuations in the raw materials can arise due to factors including global
and domestic economic conditions, governmental regulations, supply-demand dynamics and
geopolitical conditions. In procuring raw materials from suppliers, most of the companies in the
industry generally adopt a one-time pricing model. The one-time pricing model sets a fixed price
during the term of a contract, providing certainty for both parties. The following tables illustrate
the historical pricing trends of major core materials in China’s specialized PCB equipment
industry:
CAGR
CAGR20-24 CAGR25E-29E
4.3% -5.0%
327.0 339.7 361.6 392.0 387.3 378.0 364.4 347.3 327.8 307.6
0
100
200
300
400
500
600
700
2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E
Laser Equipment
RMB Thousand
Historical and Forecasted Price Changes of Laser Equipment for
Specialized  PCB Equipment, 2020–2029E
9.2 9.8 10.5 10.2 10.1 9.8 9.6 9.2 8.8 8.4
0
4
8
12
16
20
2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E
Spindle
CAGR
CAGR20-24 CAGR25E-29E
2.3% -3.9%
RMB Thousand
Historical and Forecasted Price Changes of Spindles for
Specialized PCB Equipment, 2020–2029E
Historical and Forecasted Price Changes of Motion Control
Systems for Specialized PCB Equipment, 2020–2029E
E
23.9 24.8 25.8 23.6 22.8 22.0 21.1 20.3 19.4 18.6
0
10
20
30
40
50
2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E
Motion Control Systems
RMB Thousand
CAGR
CAGR20-24 CAGR25E-29E
-1.2% -4.1%
Source: CIC
SOURCE OF INFORMATION
We engaged CIC, an independent market research and consulting company that provides
industry consulting services, commercial due diligence, and strategic consulting, to conduct
detailed research on and analysis of the global specialized PCB equipment industry. We have
agreed to pay a fee of RMB349,800 to CIC in connection with the preparation of the CIC Report.
We have incorporated certain information from the CIC Report into this section, as well as into
“Summary,” “Business,” “Financial Information,” and elsewhere in this document to provide
potential investors with a comprehensive presentation of the industries where we operate.
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During the preparation of the CIC Report, CIC conducted both primary and secondary
research, and gathered knowledge, statistics, information, and insights on industry trends within
the target research markets. The primary research involved interviews with key industry experts
and leading industry participants. The secondary research consisted of analyzing data from various
publicly available sources, such as the National Bureau of Statistics.
The CIC Report was compiled based on the following assumptions: (i) the overall social,
economic, and political environment is expected to remain stable during the forecast period; (ii)
related key industry drivers are likely to propel continued growth in the global specialized PCB
equipment industry throughout the forecast period, including favorable policies and wider
acceptance of different levels of autonomous driving features in vehicle; and (iii) there will be no
extreme force majeure or unforeseen industry regulations in which the market may be affected in
either a dramatic or fundamental way during the forecast period.
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We are subject to the laws, rules and regulations of the relevant jurisdictions in which we
operate in many aspects of our business. This section contains a summary of PRC laws, rules and
regulations that have a material impact on our current business activities in China.
LAWS AND REGULATIONS RELATING TO COMPANIES
Company entities established, operated, and managed within the territory of the People’s
Republic of China are subject to the Company Law of the People’s Republic of China ( ʕശɛ͏
,t h e “Company Law” ), which was promulgated by Standing Committee of the
National People’s Congress (the “ SCNPC ”) in December 1993 and has been further amended in
December 1999, August 2004, October 2005, December 2013, October 2018, and on December 29,
2023, with the latest revisions coming into effect on July 1, 2024. The Company Law regulates the
establishment, operation, corporate structure, and management of corporate entities in China.
According to the Company Law, the companies established in China may take the form of limited
liability company or joint stock company with limited liability. Each company has the status of a
legal person and owns the assets itself. The Company Law also applies to foreign-invested
companies.
LAWS AND REGULATIONS RELATING TO FOREIGN INVESTMENT
Foreign investors’ investment activities in China are mainly regulated by the Catalog of
Encouraged Industries for Foreign Investment ( ོᎸ̮ਠҳ༟ପุͦ፽,t h e“ Encouraged
Catalog ”), the Special Administrative Measures for Foreign Investment Access (ɝत
݄( ૶ఊ),t h e“ Negative List ”) and the Foreign Investment Law of the PRC ( ʕശ
,t h e“ Foreign Investment Law ”), as amended from time to time,
together with their implementing rules and subsidiary provisions, which are promulgated by the
Ministry of Commerce (the “ MOFCOM ”) and the National Development and Reform Commission
(the “ NDRC”).
The Foreign Investment Law was promulgated by the National People’s Congress on March
15, 2019 and came into effect on January 1, 2020, replacing China’s three then foreign investment
laws, namely the Law of the PRC on Chinese-Foreign Equity Joint Ventures ( ʕശɛ͏΍ձ਷ʕ
), Law of the PRC on Wholly Foreign-owned Enterprise ( ʕശɛ͏΍ձ਷̮
) and Law of the PRC on Chinese-Foreign Contractual Joint Ventures ( ʕശɛ͏΍ձ
). The Foreign Investment Law establishes a basic framework for the
access, promotion, protection and regulation of foreign investment through legislation to protect
investment and fair competition. According to the Foreign Investment Law, foreign investments are
entitled to pre-establishment national treatment, except for foreign investment in industries that are
considered to be “restricted” or “prohibited” under the Negative List issued and approved by the
State Council. To ensure the effective implementation of the Foreign investment Law, the
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Regulations on Implementing the Foreign Investment Law of the PRC ( ʕശɛ͏΍ձ਷̮ਠҳ༟
ૢԷ,t h e“ Foreign Investment Law Implementation Regulations ”) was promulgated by
the State Council in December 2019 and came into effect on January 1, 2020.
On September 6, 2024, the NDRC and the MOFCOM jointly promulgated and implemented
the Special Administrative Measures (Negative List) for Foreign Investment Access (2024 Edition)
(݄( ૶ఊ)(2024و),t h e“ 2024 Negative List ”) on November 1,
2024 to replace the original Negative List. According to the Foreign Investment Law, the Foreign
Investment Law Implementation Regulations and the 2024 Negative List, foreign investors are not
allowed to invest in prohibited industries listed in the Negative List, and at the same time, foreign
investment in the restricted industries listed in the Negative List must meet the specified
conditions. Industries not included in the Negative List are considered to be “permitted” for
foreign investment.
LAWS AND REGULATIONS RELATING TO OVERSEAS INVESTMENT
According to the Administrative Measures for Overseas Investment ()
promulgated by the MOFCOM on September 6, 2014 and implemented on October 6, 2014, the
MOFCOM and the provincial-level competent departments of commerce shall respectively
implement the administration of filing and approval according to the different circumstances of
enterprises’ overseas investments. Where an enterprise’s overseas investment involves sensitive
countries and regions or sensitive industries, it shall be subject to approval management. Overseas
investment by enterprises under other circumstances shall be subject to record-filing management.
According to the Administrative Measures for Overseas Investment of Enterprises ( Άุྤ
) promulgated by the NDRC on December 26, 2017 and implemented on March
1, 2018, domestic enterprises (the “ Investors ”) carrying out overseas investments shall complete
the formalities such as approval and filing of overseas investment projects, report relevant
information, and cooperate with supervision and inspection. The scope of the approval
management is sensitive projects carried out by the Investors directly or through the overseas
enterprises controlled by the Investors. The scope of record-filing management is non-sensitive
projects directly carried out by the investment entity, that is, non-sensitive projects involving the
Investors’ direct investment in assets, rights and interests, or the provision of financing and
guarantees. The above-mentioned sensitive projects refer to projects involving sensitive countries
or regions or sensitive industries. The Catalogue of Sensitive Industries is published by the NDRC.
The current effective catalogue of sensitive industries is the Catalog of Sensitive Industries for
Overseas Investment (2018 Edition) ( ྤ̮ҳ༟ઽชБุͦ፽ (2018و)), which came into
effect on March 1, 2018.
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LAWS AND REGULATIONS RELATING TO THE QUALITY OF PRODUCTS
According to the Product Quality Law of the PRC (,t h e
“Product Quality Law ”) promulgated by the SCNPC on February 22, 1993, implemented on
September 1, 1993, and amended on December 29, 2018, the production and sales of products in
China shall comply with the Product Quality Law. Producers shall be responsible for the quality of
the products they produce and sell. The market supervision and administration department under
the State Council is in charge of the national supervision of product quality, a manufacturer is
prohibited from producing or selling products that do not meet applicable standards and
requirements for safeguarding human health and ensuring human and property safety. Products
must be free from unreasonable dangers threatening human and property safety. Where a defective
product causes physical injury to a person or property damage, the aggrieved party may make a
claim for compensation from the producer or the seller of the product. Producers and sellers of
non-compliant products may be ordered to cease the production or sale of the products and could
be subject to confiscation of the products and/or fines; earnings from sales in contravention of
such standards or requirements, if any, may also be confiscated, and in severe cases, an offender’s
business license may be revoked.
According to the Civil Code of the PRC (Պ) promulgated by the
National People’s Congress on May 28, 2020 and effective on January 1, 2021, if damage is
caused to the other party due to product defects, the infringed party may claim compensation from
the producer or seller of the product, and has the right to require the producer and seller to bear
tort liability, such as stopping the infringing act, removing the obstruction and eliminating the
danger.
LAWS AND REGULATIONS RELATING TO PRODUCTION SAFETY
According to the Production Safety Law of the PRC (,t h e
“Production Safety Law ”), promulgated by the SCNPC on June 29, 2002, implemented on
November 1, 2002, and amended on June 10, 2021, entities engaged in production and business
activities in China must comply with the Production Safety Law and other laws and regulations
related to work safety. Production and business operation units should strengthen the management
of production safety, establish and improve the responsibility system for production safety and the
rules and regulations for production safety, improve the conditions for production safety, promote
the standardization of production safety, improve the level of production safety, and ensure safe
production. The main person in charge of the production and business operation unit shall be fully
responsible for the safety production work of the unit. Violation of the Production Safety Law will
result in fines, suspension of production and operation, and orders to suspend production and
business, and criminal liability will be investigated if serious consequences are caused.
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According to the Measures for the Supervision and Administration of “Three Simultaneities”
for the Safety Facilities of Construction Projects ( )
promulgated by the former State Administration of Work Safety (currently known as the Ministry
of Emergency Management) on December 14, 2010 and amended on April 2, 2015, the safety
facilities in a newly built, reconstructed or expanded construction project must be designed,
constructed and put into use simultaneously with the main body of the project. The enterprises
shall demonstrate and pre-assess the safety conditions of its construction projects, prepare a
dedicated safety design report, submit to the relevant work safety administrative department for
examination or filing, complete acceptance of safety facilities and prepare reports for inspection
according to requirements. If an enterprise violates the relevant requirements, it may be ordered to
make corrections within a specified time limit, discontinue the construction process or suspend its
production and business operation for rectification, and imposed a fine.
LAWS AND REGULATIONS RELATING TO FIRE PREVENTION
According to the Fire Protection Law of the PRC (), which was
last amended by the SCNPC on April 29, 2021 and took effect on the same day, the emergency
management department under the State Council and the emergency management department under
the local people’s governments at or above the county level shall supervise and manage fire
protection work. Fire prevention design and construction must comply with national technical
standards for fire protection in construction projects.
LAWS AND REGULATIONS RELATING TO ENVIRONMENT PROTECTION
Environment Protection
According to the Environmental Protection Law of the PRC (),
which was last amended by the SCNPC on April 24, 2014 and came into effect on January 1,
2015, any entity that discharges or will discharge pollutants in the course of operation or other
activities must implement effective environmental protection measures to control and properly
handle hazardous substances such as waste gas, waste water, waste residues, dust, malodorous
gases, radioactive substances, noise, vibration and electromagnetic radiation generated in the
course of such activities. The State implements a pollutant discharge permit management system in
accordance with the law.
Atmospheric Pollution
According to the Atmospheric Pollution Prevention and Control Law of the PRC ( ʕശɛ͏
), promulgated by the SCNPC on September 5, 1987 and implemented on
June 1, 1988, and then amended on October 26, 2018 and implemented on the same day, enterprise
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production units and other producers and operators shall, in accordance with relevant national
regulations and monitoring norms, monitor the industrial waste gas emitted by them and the toxic
and harmful air pollutants listed in the list of Article 78 of the Atmospheric Pollution Prevention
and Control Law of the PRC () and keep the original
monitoring records. Enterprises, public institutions, and other units that emit industrial waste gases
or toxic and harmful atmospheric pollutants listed in the above-mentioned directory, as well as
other units that implement pollutant discharge permit management in accordance with the law,
shall obtain pollutant discharge permits. In addition, enterprises, public institutions and other
production and operation units constructing projects that have an impact on the atmospheric
environment shall carry out environmental impact assessment and make environmental impact
assessment documents public in accordance with the law; the units that emit pollutants into the
atmosphere must comply with the discharging standard for atmospheric pollutants as well as the
requirements on control of the total discharging amount of key atmospheric pollutants.
Water Pollution
According to the Water Pollution Prevention and Control Law of the PRC ( ʕശɛ͏΍ձ਷
), promulgated by the SCNPC on May 11, 1984 and implemented on November 1,
1984, and then amended on June 27, 2017 and came into effect on January 1, 2018, enterprises,
public institutions and other producers and operators who directly or indirectly discharge industrial
wastewater and medical sewage into water bodies, as well as other wastewater and sewage that can
only be discharged in accordance with the provisions of the regulations by obtaining a pollutant
discharge permit, shall obtain a pollutant discharge permit.
Solid Waste
According to the Law of the PRC on Prevention and Control of Environmental Pollution
Caused by Solid Wastes ( ), promulgated by the
SCNPC on October 30, 1995 and implemented on April 1, 1996, and then amended on April 29,
2020 and came into effect on September 1, 2020, any unit or individual that generates, collects,
stores, transports, utilizes or disposes of solid waste shall take measures to prevent or reduce the
pollution of the environment by solid waste, and shall bear responsibility for the environmental
pollution caused by it in accordance with the law.
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Noise Pollution
According to the Law of the PRC on Prevention and Control of Pollution From Noise ( ʕശ
), promulgated by the SCNPC on December 24, 2021 and
implemented on June 5, 2022, the emission of noise and vibration shall comply with the
requirements of noise emission standards, relevant environmental vibration control standards and
relevant laws, regulations and rules.
Environmental Impact Assessment
In accordance with the Environmental Impact Assessment Law of the PRC ( ʕശɛ͏΍ձ
) promulgated by the SCNPC on October 28, 2002 and implemented on
September 1, 2003, and then amended on December 29, 2018 and implemented on the same day,
and the Regulations on the Administration of Construction Project Environmental Protection (ܔ
ᚐ၍ଣૢԷ) promulgated by the State Council on November 29, 1998 and
implemented on the same day, and then revised on July 16, 2017 and implemented on October 1,
2017, the state implements an environmental impact assessment system for construction projects.
If the construction project may have a significant impact on the environment, an environmental
impact report shall be prepared and a comprehensive assessment of the possible environmental
impact shall be conducted; If the construction project may have a slight impact on the
environment, an environmental impact report form shall be prepared to analyze or make a special
assessment of the environmental impact generated; If the environmental impact of the construction
project is very small and there is no need for environmental impact assessment, the environmental
impact registration form shall be filled. Construction projects that have not been subject to
environmental impact assessment in accordance with the law shall not start construction. After the
completion of a construction project for which an environmental impact report and an
environmental impact report form is prepared, the construction unit shall, in accordance with the
standards and procedures prescribed by the administrative department for environmental protection
under the State Council, inspect and accept the environmental protection facilities for supporting
construction and prepare an acceptance report. The environmental protection facilities supporting
the construction of these projects can only be put into production or use after they are qualified; If
it has not been accepted or unqualified, it shall not be put into production or use. If an enterprise
violates the above-mentioned laws and regulations, the administrative department of environmental
protection at or above the county level shall order it to stop production or construction, impose a
fine, and may order it to restore its original state.
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Pollutant Discharge Permission
According to the Regulations on the Administration of Pollution Discharge Permits ( રϮ஢
̙၍ଣૢԷ) promulgated by the State Council on January 24, 2021 and took effect on March 1,
2021, enterprises, public institutions and other production and operation units subject to
administration of pollution discharge permits shall discharge pollutants in accordance with the
Administration of Pollution Discharge Permits ( રϮ஢̙၍ଣૢԷ), and shall not discharge
pollutants without obtaining a pollutant discharging permit. Environmental protection authorities
impose various administrative penalties, such as fines, order to correct, restriction or suspension of
production for rectification, and order to cease operation, etc., on individuals or enterprises that
violate the Environmental Protection Law.
LAWS AND REGULATIONS RELATING TO TAXATION
EIT
Pursuant to the Enterprise Income Tax Law of the People’s Republic of China ( ʕശɛ͏΍
) (the “ EIT Law ”) promulgated by the SCNPC on March 16, 2007 and
implemented on January 1, 2008, and then amended on December 29, 2018 and implemented on
the same day, and the Implementation Rules of the EIT Law of the People’s Republic of China
(ૢԷ ) promulgated by the State Council on December 6,
2007 and came into effect on January 1, 2008, and subsequently amended on December 6, 2024
and implemented on January 20, 2025, enterprises are divided into resident enterprises and
non-resident enterprises. A resident enterprise refers to an enterprise that is established in the
mainland China in accordance with the law, or that is established in accordance with the law of a
foreign country (region) but whose actual administration institution is in the mainland China. A
non-resident enterprise refers to an enterprise established in accordance with the law of a foreign
country (region) and whose actual administration institution is outside the mainland China, but it
has institutions or establishments in the mainland China or, if not, it has incomes originating from
the mainland China. A uniform income tax rate of 25% applies to all resident enterprises and
non-resident enterprises that have set up institutions or establishments in the mainland China to the
extent that such incomes are derived from the mainland China, or such incomes are obtained
outside the mainland China but have an actual connection with the set-up institutions or
establishments, high-tech enterprises in need of support from the State shall be subject to a
reduced enterprise income tax rate of 15%. Non-resident enterprises that have not set up
institutions or establishments in the mainland China or have set up institutions or establishments
but the income obtained by the said enterprises have no actual connection with the set-up
institutions or establishments, shall pay enterprise income tax at the rate of 10% in relation to their
income sourcing from the mainland China.
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VAT
In accordance with the Interim Regulations on Value-added Tax of the People’s Republic of
China (೼ᅲБૢԷ) promulgated by the State Council on December 13,
1993 and implemented on January 1, 1994, and then amended on November 19, 2017 and
implemented on the same day, and the Detailed Rules for the Implementation of the Interim
Regulations on Value-added Tax of the People’s Republic of China (೼ᅲБ
) promulgated by the Ministry of Finance on December 25, 1993 and implemented
on the same day, and then amended on October 28, 2011 and implemented on November 1, 2011,
the sale of goods or processing within the territory of China Units and individuals that repair and
repair services, sell services, intangible assets, immovable properties and imported goods are V AT
payers and shall pay V AT in accordance with the law. Unless otherwise specified, the V AT rate for
the sale of goods, services, tangible movable properties leasing services or imported goods by
taxpayers shall be 17%; Taxpayers who sell transportation, postal services, basic
telecommunications, construction, real estate leasing services, sell immovable properties, transfer
land use rights, and sell or import specific goods shall be subject to a V AT rate of 11%; Unless
otherwise specified, the V AT rate for the sale of services and intangible assets by taxpayers is 6%.
Pursuant to the Notice on the Adjustment to V AT Rates (),
promulgated by the Ministry of Finance and the State Administration of Taxation on April 4, 2018,
and became effective as of May 1, 2018, the V AT rates of 17% and 11% applicable to the
taxpayers who have V AT taxable sales activities or imported goods are adjusted to 16% and 10%,
respectively.
Pursuant to the Announcement on Relevant Policies for Deepening V AT Reform (ଉʷ
ʮѓ), promulgated by the Ministry of Finance, the State Administration
of Taxation and the General Administration of Customs on March 20, 2019 and became effective
on April 1, 2019, the V AT rates of 16% and 10% applicable to the taxpayers who have V AT taxable
sales activities or imported goods are adjusted to 13% and 9%, respectively.
According to the Notice on Value-Added Tax Policies for Software Products (ۜ
) issued by the Ministry of Finance and the State Administration of Taxation
on October 13, 2011, and effective from January 1, 2011, general V AT taxpayers selling
self-developed and produced software products shall be subject to V AT at a 17% rate. For the
portion of the actual V AT burden exceeding 3%, an immediate refund-upon-collection policy shall
apply. V AT general taxpayers who localize imported software products and subsequently sell them
may also enjoy this V AT refund policy.
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Dividends Distribution
In accordance with the EIT Law and the Implementation Rules of the EIT Law of the
People’s Republic of China (ૢԷ ), with effect from January
1, 2008, dividends declared to non-PRC resident investors who have not established or have a
place of business in the PRC but whose income is not actually connected with such institution or
place of business (provided that such dividends come from within the PRC) are normally subject
to a corporate income tax rate of 10%. However, any of these non-PRC resident investors
incorporated in a jurisdiction that has a tax treaty with China shall be subject to preferential
arrangements for withholding tax. According to the Notice on the Issues concerning Withholding
the Enterprise Income Tax on the Dividends Paid by Chinese Resident Enterprises to H-share
Holders Which Are Overseas Non-resident Enterprises by State Taxation Administration (೼
͏ΆุΣྤ̮ Hஷ
) issued by the State Administration of Taxation on November 6, 2008 and implemented on the
same day, when Chinese resident enterprises distribute dividends to shareholders of H-share
non-resident enterprises in 2008 and subsequent years, they shall withhold and pay enterprise
income tax at a uniform rate of 10%.
Pursuant to the Notice on the Issues Concerning Individual Income Tax Collection and
Management after the Repeal of Guo Shui Fa [1993] No. 045 (਷೼೯ [1993]045 ໮˖΁ᄻ˟
) (Guo Shui Han [2011] No. 348) ( ਷೼Ռ[2011]348 ໮) dated
June 28, 2011, issued by the SAT, dividends paid to non-mainland China resident individual
holders of H Shares are generally subject to the individual income tax of mainland China at a
withholding tax rate of 10%. Under 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), the Chinese government may tax dividends paid by Chinese companies
to Hong Kong residents (including natural and legal persons), provided that the amount of the tax
shall not exceed 10% of the total dividends payable by the Chinese company. If a Hong Kong
resident directly holds 25% or more of the equity of the PRC company, and the HK resident is the
beneficial owner of the dividends and satisfies other conditions, the relevant tax shall not exceed
5% of the total dividends payable by the PRC company. The Fifth Protocol to the Arrangement
between the mainland 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 (࢕
֛
), promulgated by the State Administration of Taxation and came into effect on December 6,
2019, provides that such provisions shall not apply to any arrangement or transaction whose main
purpose is to obtain such tax incentives.
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In accordance with the applicable regulations, we intend to withhold tax at a rate of 10%
from dividends paid to shareholders of H-share non-PRC resident enterprises (including the Hong
Kong Securities Clearing and Settlement Agent). Non-PRC resident enterprises entitled to tax
reduction and exemption under the applicable income tax agreement are required to apply to the
PRC tax authorities for a refund of the amount of withholding tax in excess of the applicable
agreed tax rate, and the refund shall be verified by the PRC tax authorities.
LAWS AND REGULATIONS RELATING TO LABOR AND SOCIAL INSURANCE
Labor Regulations
According to the Labor Law of the People’s Republic of China ()
promulgated by the SCNPC on July 5, 1994 and amended on December 29, 2018 after it came into
effect on January 1, 1995, and implemented on the same day, the Labor Contract Law of the
People’s Republic of China () promulgated by the SCNPC on June
29, 2007 and implemented on January 1, 2008, and then amended on December 28, 2012 and
implemented on July 2013, and the Implementation Regulations of the Labor Contract Law of the
People’s Republic of China (ૢԷ ), which was promulgated by
the State Council on September 18, 2008 and came into effect on the same day, an employer and
an employee shall enter into a written labor contract when establishing an employment
relationship. The employer shall, in accordance with the provisions of the labor contract and
relevant laws and regulations, pay the labor remuneration to the employee in full and in a timely
manner. At the same time, the wages of workers must not be lower than the local minimum wage.
Social Insurance and Housing Provident Fund
According to the Social Insurance Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷
) promulgated by the SCNPC on October 28, 2010 and last amended on December
29, 2018 after it came into effect on July 1, 2011, the Provision Regulations for The Collection
And Payment of Social Insurance Premiums (ᎈ൬ᅄᖮᅲБૢԷ) promulgated by the
State Council on January 22, 1999 and implemented on March 24, 2019 after the implementation
on the same day, employers in China are required to provide employees with welfare schemes
covering basic pension insurance, basic medical insurance, unemployment insurance, maternity
insurance and work-related injury insurance. If an enterprise fails to pay the above-mentioned
social insurance premiums, the social insurance premium collection agency shall order it to pay or
make up for it within a time limit, and if it still fails to pay within the time limit, it will face
administrative penalties such as fines.
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According to the Judicial Interpretation (II) of the Supreme People’s Court on the Application
of Law in the Trial of Labor Dispute Cases (ਪᕚ
༆ᙑ(ɚ)), promulgated by the Supreme People’s Court on August 1, 2025 and effective from
September 1, 2025, any agreement between a PRC employer and an employee or an employee’s
undertaking to the employer on the non-contribution of social insurance shall be deemed invalid by
the people’s court. If an employee requests to terminate the employment agreement and seek
economic compensation on the grounds that the employer has failed to pay social insurance
contributions in accordance with the applicable laws, the people’s court shall support such claims.
Conversely, if the enterprise has lawfully paid the social insurance contributions and then requests
the employee to return the compensation already paid, the people’s court shall also support such
claim.
According to the Administrative Regulations on the Housing Provident Fund (၍
ଣૢԷ), promulgated by the State Council on April 3, 1999 and implemented on the same day,
and later revised on March 24, 2019 and implemented on the same day, enterprises shall register
the housing provident fund with the Housing Provident Fund Management Center and go through
the procedures for the establishment or transfer of housing provident fund accounts for their
employees. Enterprises should pay the housing provident fund on time, and if the housing
provident fund is not paid or underpaid within the time limit, the housing provident fund
management center shall order it to pay within a time limit; If they still fail to deposit within the
time limit, they may apply to the people’s court for compulsory enforcement.
LAWS AND REGULATIONS RELATING TO THE IMPORT AND EXPORT OF GOODS
Import and Export Management
Pursuant to the Foreign Trade Law of the PRC () promulgated
by the SCNPC on May 12, 1994 and last amended on December 30, 2022 and the Notice by the
Department of Enterprise Management and Audit-Based Control of Matters Concerning the
Recordation of the Consignees and Consignors of Imported and Exported Goods (Άุ၍ଣձᇆ
 ) issued by the General Administration of
Customs of the PRC on January 3, 2023, a consignee or consignor of imported or exported goods
who applies for filing shall be qualified as a market entity and is not required to be filed as a
foreign trade business operator.
According to the Customs Law of the PRC () promulgated by the
SCNPC on January 22, 1987 and last amended on April 29, 2021, unless otherwise stipulated, the
declaration of imported or exported goods may be made by the consignees or the consignors, or
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the entrusted customs brokers. To undergo customs declaration formalities, the consignee or
consignor of imported or exported goods and the customs brokers shall file with the Customs in
accordance with the law.
According to the Provisions on the Recordation of Customs Declaration Entities of the
PRC( ) promulgated by the General Administration
of Customs on November 19, 2021 and executed on January 1, 2022, the consignee or consignor of
imported or exported goods or customs brokers, as filed with the customs may undergo customs
declaration within the customs territory of the PRC. Where a consignee or consignor of imported
or exported goods or customs brokers applies for filing, it shall obtain the qualification of market
entities.
Import and Export Commodity Inspection
Pursuant to the Law of the PRC on Import and Export Commodity Inspection ( ʕശɛ͏΍
) promulgated by the SCNPC on February 21, 1989 and implemented on
August 1, 1989 and then amended on April 29, 2021 and entered into force on the same day, as
well as the Regulations for the Implementation of the Law of the PRC on Import and Export
Commodity Inspection (ૢԷ ) promulgated by the State
Council on August 31, 2005 and implemented on December 1, 2005, and then amended on March
29, 2022 and implemented on May 1, 2022, the General Administration of Customs is in charge of
the inspection of import and export commodities nationwide. The entry-exit inspection and
quarantine authorities shall inspect the import and export commodities included in the catalogue
and other import and export commodities that are required to be inspected by the entry-exit
inspection and quarantine authorities as stipulated by laws and administrative regulations. The
entry-exit inspection and quarantine authorities shall carry out random inspections on import and
export commodities other than those mentioned above in accordance with national regulations. If
the imported goods that must be inspected have not been inspected, they are not allowed to be sold
or used. Export commodities that must be inspected are not allowed to be exported if they have
not been inspected or have failed to pass the inspection.
LAWS AND REGULATIONS RELATING TO THE MANAGEMENT OF REAL ESTATE
State-Owned Land
According to the Land Administration Law of the PRC ()
promulgated by the SCNPC on June 25, 1986 and latest amended on August 26, 2019, and the
Regulations for the Implementation of the Land Administration Law of the PRC ( ʕശɛ͏΍ձ
ૢԷ) promulgated by the State Council on December 27, 1998 and latest
revised on July 2, 2021, the land in the PRC is either State-owned or collectively-owned. Except
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for land which is legally owned by the State or has been expropriated as State-owned according to
law, all of the land is collectively-owned. The State-owned land use rights may be used by third
parties through grant, allocation, lease, capital contribution and other forms. Third parties who
have obtained the State-owned land use rights may legally use, profit from and dispose of the
State-owned land use rights within the statutory term of use and scope of planned uses.
Planning
According to the Urban and Rural Planning Law of the PRC ()
promulgated by the SCNPC on October 28, 2007 and latest amended on April 23, 2019, if the
construction of buildings, structures, roads, pipelines and other projects is carried out in the
planned area of a city or a town, the construction entity or individual shall apply to the competent
authority of urban and rural planning of the people’s government of the city or county or the
people’s government of the town as determined by the people’s government of the province,
autonomous region or municipality directly under the Central Government for a construction
project planning permit.
Project Construction
According to the Construction Law of the People’s Republic of China (ܔ
) promulgated by the SCNPC on November 1, 1997 and amended on April 23, 2019, prior to
the commencement of construction work, the construction entity shall apply to the competent
construction administrative authority of the people’s government at or above the county level
where the project is located for a construction permit in accordance with the relevant provisions of
the State, except for small-scale projects under the quota as determined by the construction
administrative authority under the State Council. A construction project shall be delivered for use
only after it has passed the acceptance examination. A construction project shall not be delivered
for use without conducting or passing the acceptance examination.
LAWS AND REGULATIONS RELATING TO RENTAL PROPERTIES
According to the Civil Code of the PRC (Պ), the owner of
immovable or movable property has the right to possess, use, proceeds and the right to dispose of
such immovable or movable property. With the consent of the lessor, the lessee may sublease the
leased premises to a third party. If the tenant subleases the premises, the lease contract concluded
between the lessee and the lessor is still valid. If the tenant subleases the premises without the
consent of the lessor, the lessor has the right to terminate the lease. In addition, if the ownership
of the leased premises changes during the period of possession by the lessee under the lease
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contract, it does not affect the validity of the lease contract. In addition, according to the Civil
Code of the PRC (Պ), if the mortgage has been leased and transferred
before the mortgage is established, the original lease is not affected by the mortgage.
The Measures for the Administration of Leasing of Commercial Housing Houses (܊גۜ
), issued by the Ministry of Housing and Urban-Rural Development on December
1, 2010 and effective on February 1, 2011, stipulate that within 30 days from the date of signing
the housing lease contract, both parties to the contract shall complete the housing lease registration
with the construction (real estate) department of the government where the rental house is located.
If the unit fails to perform this obligation, the competent department of construction (real estate)
shall urge it to make corrections within a time limit, and if it fails to make corrections within the
time limit, it shall be fined not less than RMB1,000 but not more than RMB10,000.
According to the Interpretation of the Supreme People’s Court on Several Issues Concerning
the Specific Application of Law in the Trial of cases on Disputes over Urban Housing Leasing
Contracts (2020 Amendment) (ܛج
༆ᙑ (2020͍)), which came into effect on January 1, 2021, if the ownership of the
leased house changes during the period of the tenant’s possession according to the terms of the
lease contract, and the tenant requests the transferee to continue to perform the original lease
contract, the Chinese court shall uphold it, unless the mortgage has been created before the lease
of the leased house and the change of ownership has occurred due to the mortgagee’s realization of
the mortgage.
LAWS AND REGULATIONS RELATING TO FOREIGN EXCHANGE
According to the Regulations of the People’s Republic of China on Foreign Exchange
Administration ( ʕശɛ͏΍ձ਷̮ි၍ଣૢԷ), promulgated by the State Council on January
29, 1996 and implemented on April 1, 1996, as amended on August 5, 2008 and implemented on
the same day, current account payments, such as profit distribution, interest payments and foreign
exchange transactions related to trade and services, may be transacted in foreign currencies
without the prior approval of the State Administration of Foreign Exchange, subject to certain
procedural requirements. Conversely, if RMB is converted into a foreign currency and remitted out
of China for payment of capital accounts such as direct investment, repayment of foreign currency
loans, investment repatriation and portfolio investment outside China, approval or registration is
required from the relevant government agencies
According to the Circular on Issues Concerning the Administration of Foreign Exchange
Involved in Overseas Listing ( ), promulgated by the
State Administration of Foreign Exchange on December 26, 2014 and implemented on the same
day, a domestic company shall register its overseas listing with the local branch of the State
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Administration of Foreign Exchange at the place of its incorporation within 15 working days from
the date of completion of the overseas listing and issuance. The funds raised by the domestic
company from overseas listing can be repatriated to China or deposited overseas, and the use of
the funds shall be consistent with the relevant contents listed in the documents or public disclosure
documents such as corporate bond offering documents, shareholder circulars, resolutions of the
board of directors or shareholders’ general meetings, etc.
According to the Notice on Revolutionize and Regulate Capital Account Settlement
Management Policies ( ) promulgated by the
State Administration of Foreign Exchange on June 9, 2016 and implemented on the same day, and
then revised on December 4, 2023 and implemented on the same day, the relevant policies have
clearly stated that the foreign exchange income of the capital account (including foreign exchange
capital, foreign debt funds and funds repatriated from overseas listings, etc.) that is willing to
settle foreign exchange can be settled by banks according to the actual business needs of domestic
institutions. Where the current laws and regulations have restrictive provisions on the settlement of
foreign exchange earnings under the capital account of domestic institutions, such provisions shall
prevail. The proportion of foreign exchange income from the capital account of domestic
institutions is tentatively set at 100%. The State Administration of Foreign Exchange may adjust
the above ratios in a timely manner according to the balance of payments situation.
LAWS AND REGULATIONS RELATING TO INTELLECTUAL PROPERTY
Patent
According to the Patent Law of the PRC () last amended by the
SCNPC on October 17, 2020 and came into effect on June 1, 2021, and the Implementation
Regulations for the Patent Law of the PRC () last amended by
the State Council on December 11, 2023 and came into effect on January 20, 2024, patents are
divided into 3 categories, i.e. invention patents, utility model patents and design patents. The
validity period of patents for inventions is 20 years, while the validity period of patents for utility
models is 10 years, and the validity period of patents for designs is 15 years, all starting from the
date of application. The patent right enjoyed by the patentee shall be protected by law. No one is
allowed to use the patent without the permission or authorization of the patentee, otherwise, the
use of the patent will constitute patent infringement.
Trademark
In accordance with the Trademark Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷
) promulgated by the SCNPC on August 23, 1982 and implemented on March 1, 1983, and
then amended on April 23, 2019 and implemented on November 1, 2019, and the Implementation
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Rules of the Trademark Law of the People’s Republic of China (ૢ
Է) promulgated by the State Council on August 3, 2002 and implemented on September 15,
2002, and then revised on April 29, 2014 and implemented on May 1, 2014, the Trademark Office
has been approved Quasi-registered trademarks are registered trademarks, including commodity
trademarks, service marks, collective marks and certification marks. The registration of the
trademark is valid for ten years from the date of approval of registration. If the registered
trademark expires and needs to continue to be used, the trademark registrant shall go through the
renewal procedures within 12 months before the expiration. Each renewed registration is valid for
10 years, starting from the day after the expiration of the previous term of validity of the
trademark.
Copyright
According to the Copyright Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷ഹЪᛆ
), promulgated by the SCNPC on September 7, 1990 and implemented on June 1, 1991, and
then amended on November 11, 2020 and implemented on June 1, 2021, the works of Chinese
citizens, legal persons or unincorporated organizations refer to works that are original and capable
of unity in the fields of literature, art and science Intellectual achievements expressed in a definite
form, whether published or not, enjoy copyright. Copyright owners enjoy a variety of rights,
including the right of publication, the right of authorship and the right of reproduction.
In accordance with the Regulations for the Protection of Computer Software (ڭ
ᚐૢԷ) promulgated by the State Council on June 4, 1991 and implemented on October 1, 1991
and then revised on January 30, 2013 and implemented on March 1, 2013, and the Measures for
the Registration of Computer Software Copyright () promulgated by
the National Copyright Administration on February 20, 2002 and implemented on the same day,
and then revised on June 18, 2004 and implemented on July 1, 2004, the National Copyright
Administration is in charge of the national software copyright registration administration. It also
recognized the China Copyright Protection Center as a software registration agency. The China
Copyright Protection Center will grant registration certificates to applicants for computer software
copyrights who meet the requirements of the Regulations for the Protection of Computer Software
and the Measures for the Registration of Computer Software Copyright.
Domain Name
According to the Measures for the Administration of Internet Domain Names ( ʝᑌၣਹΤ
), promulgated by the Ministry of Industry and Information Technology on August 24,
2017 and implemented on November 1, 2017, domain name registration is handled through a
domain name registrar established in accordance with relevant regulations, and when the
registration is successful, the applicant becomes the domain name holder.
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LAWS AND REGULATIONS RELATING TO ANTI-MONOPOLY AND ANTI-UNFAIR
COMPETITION
Anti-Monopoly Law
According to the Anti-Monopoly Law of the PRC () (the
“Anti-Monopoly Law ”), promulgated by the SCNPC on August 30, 2007 and implemented on
August 1, 2008, and last amended on June 24, 2022 and implemented on August 1, 2022, the
Anti-Monopoly Law shall apply to monopolistic acts in economic activities within the territory of
China, as well as monopolistic acts outside the PRC that have an impact on the exclusion or
restriction of competition in the domestic market. Monopolistic acts under the Anti-Monopoly Law
include undertakings entering into monopoly agreements, undertakings abusing their dominant
market position, and concentrations of undertakings that have or may have the ability to eliminate
or restrict market competition. The anti-monopoly law enforcement agency of the State Council
shall be responsible for anti-monopoly law enforcement in accordance with the provisions of the
Anti-Monopoly Law. The anti-monopoly law enforcement agency of the State Council may, as
necessary for its work, authorize the corresponding agencies of the people’s governments of
provinces, autonomous regions and municipalities to be responsible for the relevant anti-monopoly
law enforcement work, if a business operator violates the provisions of the Anti-Monopoly Law,
the Anti-Monopoly Law enforcement agency shall order it to cease the illegal act and may impose
a fine.
Anti-Unfair Competition Law
According to the Anti-Unfair Competition Law of the PRC (ن
) (the “ Anti-Unfair Competition Law ”) promulgated by the SCNPC on September 2, 1993
and implemented on December 1, 1993, and last amended on April 23, 2019 and implemented on
the same day, business operators shall follow the principles of voluntariness, equality, fairness and
good faith in market transactions, and abide by laws and business ethics. The term “acts of unfair
competition” as used in the Anti-Unfair Competition Law refers to the acts of operators in
violation of the provisions of the Anti-Unfair Competition Law in their production and business
activities, disrupting the order of market competition, and harming the legitimate rights and
interests of other business operators or consumers, if a business operator violates the provisions of
the Anti-Unfair Competition Law. It shall bear civil, administrative and criminal liabilities
depending on the specific circumstances.
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Advertising
On October 27, 1994, the SCNPC promulgated the Advertising Law of the People’s Republic
of China ()(the “ Advertising Law ”), which was last amended on April
29, 2021 and came into effect on the same day. According to the Advertising Law, advertisements
must not contain any false or misleading content, and must not deceive or mislead consumers.
Advertisers shall be responsible for the authenticity of the content of the advertisement. Where
false advertisements are published, the market regulation departments are to order the publication
of the advertisements to be stopped, order the advertisers to eliminate the impact within the
corresponding scope, and impose fines. Where false advertisements cause harm to the lawful rights
and interests of consumers who purchase goods or receive services, the advertiser bears civil
liability in accordance with law.
Protection of Personal Information
The Personal Information Protection Law of the PRC ()
(the “ PIPL”) promulgated by the SCNPC on August 20, 2021 and came into effect on November
1, 2021 consolidates the decentralized rules on personal information rights and privacy protection.
The PIPL aims to protect the rights and interests of personal information, regulate personal
information processing activities, ensure the orderly and free flow of personal information in
accordance with the law, and promote the rational use of personal information. Personal
information as defined in the PIPL refers to all kinds of information related to identified or
identifiable natural persons recorded electronically or by other means, excluding anonymized
information. The PIPL stipulates the circumstances under which personal information processors
may process personal information, including but not limited to obtaining the consent of the
individual, and where it is necessary for the conclusion and performance of a contract to which the
individual is a party. It also sets out certain specific rules regarding the obligations of personal
information processors, such as informing individuals of the purposes of processing, the means of
processing, and the obligation of third parties who have access to personal information through
joint processing or entrustment.
LAWS AND REGULATIONS RELATING TO BID INVITATIONS AND BIDDING
According to the Bid Invitation and Bidding Law of the PRC (ᅺҳᅺ
,t h e“ Bidding Law ”), promulgated by the SCNPC on August 30, 1999 and implemented on
January 1, 2000 which was later revised on December 27, 2017 and again implemented on
December 28, 2017, and the Regulations for the Implementation of the Tendering and Bidding Law
of the PRC (ૢԷ ), promulgated by the State Council on
December 20, 2011 and implemented on February 1, 2012 and later revised and implemented on
March 2, 2019, projects related to social public interests and public safety, such as large-scale
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infrastructure and public utility projects, as well as projects that use all or part of state-owned
capital investment or national financing, must undergo tendering for their surveying, design,
construction, supervision, and procurement of important equipment and materials related to these
projects. In China, tendering is divided into open tendering and invited tendering. If the tenderer
adopts the method of open tendering, they shall issue a tender announcement. If the tenderer
adopts the method of invited tendering, they shall send out invitation letters to three or more
specific legal persons or other organizations with the capability to undertake the tender project and
good credit standing; the tenderer shall not impose unreasonable conditions to restrict or exclude
potential bidders, nor shall they treat potential bidders unfairly.
For violations of the Bidding Law, the bidder’s winning bid may be declared invalid, and the
competent authority has the right to impose administrative penalties such as ordering rectification
within a time limit, fines, and confiscation of illegal gains; in serious cases, the bidder will be
disqualified from participating in legally required bidding projects for one to two years and will be
publicly announced, up to and including revocation of business licenses by the administrative
department of industry and commerce; if a crime is constituted, criminal responsibility will be
pursued according to law. If losses are caused to others, legal liability for compensation shall be
borne.
LAWS AND REGULATIONS RELATING TO SECURITIES AND OVERSEAS LISTING
Securities Laws and Regulations
The Securities Law of the People’s Republic of China () (the
“Securities Law ”) promulgated by the SCNPC on December 29, 1998 and implemented on July 1,
1999, as amended on December 28, 2019 and implemented on March 1, 2020, comprehensively
regulates the trading activities of the securities market in the PRC, including the issuance and
trading of securities, the acquisition of listed companies, and the duties of stock exchanges,
securities companies and securities regulators. The Securities Law further regulates the direct or
indirect issuance of securities or the listing of securities by domestic enterprises abroad, which
shall comply with the relevant regulations of the State Council, and the specific measures shall be
separately stipulated by the State Council. The China Securities Regulatory Commission (the
“CSRC”) is a securities regulator established by the State Council to regulate and manage the
securities market in accordance with laws and regulations, maintain market order and ensure the
operation of the market in a lawful manner. At present, the issuance and trading of H shares are
mainly regulated by laws and regulations promulgated by the State Council and the China
Securities Regulatory Commission.
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Overseas Listing Laws
According to the Trial Administrative Measures of Overseas Securities Offering and Listing
by Domestic Companies (the “ Overseas Listing Measures ”) issued by the CSRC on February 17,
2023 and effective from March 31, 2023, where a domestic company issuer procures an overseas
initial public offering or listing, it shall file with the CSRC within three business days after
submitting application documents for overseas securities offering and listing.
The Overseas Listing Measures stipulate that an overseas listing shall not be allowed under
any of the following circumstances: (i) where the listing and financing are expressly prohibited by
laws, administrative regulations or relevant national regulations; (ii) the overseas issuance and
listing may endanger national security as determined by the relevant competent departments of the
State Council in accordance with the law; (iii) the domestic enterprise or its controlling
shareholder or actual controller has committed a criminal offense of corruption, bribery,
embezzlement of property, misappropriation of property, or undermining the order of the socialist
market economy within the past three years; (iv) the domestic enterprise is under investigation in
accordance with the law for suspected crimes or major violations of laws and regulations, and no
conclusive conclusion has been reached; and (v) there is a major dispute over the ownership of the
equity held by the controlling shareholder of the domestic enterprise or the shareholder controlled
by the controlling shareholder or actual controller. In addition, the Measures for Overseas Listing
stipulate that if an issuer has any of the following major events after its overseas issuance and
listing, it shall report the specific circumstances to the CSRC within three working days from the
date of occurrence and announcement of the relevant matters: (i) change of control; (ii) being
investigated or punished by an overseas securities regulatory authority or relevant competent
authority; (iii) change of listing status or listing sector; and (iv) voluntary termination of listing or
compulsory termination of listing. At the same time, domestic enterprises shall strictly abide by
national security laws, administrative regulations and relevant provisions on foreign investment,
network security, data security, and other national security laws, administrative regulations, and
data security in their overseas issuance and listing activities, and earnestly fulfill their obligations
to safeguard national security.
According to the Provisions on Strengthening Confidentiality and Archives Administration
Concerning Overseas Securities Offering and Listing by Domestic Companies (̋੶ྤʫΆ
 ) jointly issued by the China Securities
Regulatory Commission, the Ministry of Finance, the State Secrets Administration and the State
Archives Administration on February 24, 2023 and implemented on March 31, 2023, domestic
enterprises provide and publicly disclose documents involving state secrets and work secrets of
state organs to relevant securities companies, securities service institutions, overseas regulatory
agencies and other entities and individuals, or through their overseas listed entities. Where
materials are filed, they shall be reported to the competent department with the authority to
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examine and approve them for approval in accordance with law, and shall be reported to the
department for the administration and management of secrecy at the same level for the record. The
working papers formed by securities companies and securities service institutions that provide
corresponding services for the overseas issuance and listing of domestic enterprises shall be stored
in China. Those who need to leave the country shall go through the examination and approval
procedures in accordance with the relevant state regulations.
LAWS AND REGULATIONS RELATING TO TARIFFS IMPOSED BY THE UNITED
STATES
In February 2025, the president of the United States imposed 20% tariffs (the “ US Tariffs ”)
on Chinese goods. On April 2, 2025, the president of the United States imposed a 10%
across-the-board tariff on all imports from the U.S.’s trading partners, along with additional
country-specific tariffs for various countries (the “ Reciprocal Tariffs ”, as adjusted from time to
time). On April 9, 2025, it was announced that the Reciprocal Tariffs would be paused for 90 days
for all countries but China. On April 10, 2025, the Reciprocal Tariffs on China were raised to
125%. Certain consumer electronics, including smartphones and computers, are exempt from the
Reciprocal Tariffs. The Chinese government announced the imposition of tariff on U.S. goods in
response. The United States and China are engaging in trade discussions, and on May 12, 2025,
the United States stated that they would lower the Reciprocal Tariffs on China to 10% for 90 days.
The US Tariffs still remain in place. Therefore, the overall tariff burden on imports from China has
fluctuated from time to time.
On May 28, 2025, the U.S. Court of International Trade ruled that the above tariffs exceeded
the president’s legal authority. However, that decision is being appealed. Subsequently, following
further bilateral negotiations between the United States and China and the implementation of
related executive and administrative measures, the U.S. tariff regime applicable to PRC-origin
goods has been adjusted. According to publicly available information as of the Latest Practicable
Date, during the current suspension period, the United States imposes (i) a 10% additional tariff on
all PRC-origin goods and (ii) a 10% reciprocal tariff on PRC-origin goods in general. As a result,
for PRC-origin goods that are not subject to any exemption from the reciprocal tariff, the
combined additional U.S. tariff rate is approximately 20% (being a 10% additional tariff plus a
10% reciprocal tariff), in addition to any applicable normal most-favoured-nation duties.
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In addition, certain consumer electronics, including smartphones, computers and certain
electronic components, have been excluded from the reciprocal tariff pursuant to an announcement
issued by the U.S. Customs and Border Protection on April 11, 2025, and such exemption
remained effective as of the Latest Practicable Date. Accordingly, these consumer electronics are
subject only to the 10% additional tariff and are exempt from the 10% reciprocal tariff, resulting in
an effective additional U.S. tariff rate of 10% for such products as of the Latest Practicable Date,
in addition to any applicable normal most-favoured-nation duties. As of the Latest Practicable
Date, U.S.-origin goods imported into China are in general subject to an additional 10% reciprocal
tariff as a countermeasure to U.S. Section 301 tariffs, and certain U.S.-origin goods are further
subject to additional tariffs under other Chinese countermeasures, in each case on top of the
applicable most-favoured-nation or other base import tariff rates.
However, the international tariff policies are rapidly evolving, and the final outcome,
including whether the Current US Tariffs can be implemented as proposed, is highly uncertain.
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OVERVIEW
The history of our business could date back to 2002 when our Company was founded in
Shenzhen, Guangdong. Over the years, we have evolved to a leading specialized PCB production
equipment solution provider in China, operating in the specialized PCB equipment industry and
serving as a key infrastructure provider for a variety of downstream industries.
Our Company was established under the laws of the PRC on April 22, 2002. In November
2020, our Company was converted into a joint stock company with limited liability from a limited
liability company. In February 2022, our A Shares were listed on the Shenzhen Stock Exchange
(stock code: 301200).
OUR KEY MILESTONES
The following is a summary of our Group’s key business development milestones:
Year Event
2002 Our Company was established and we launched our Driller-666 CNC mechanical
drilling machine series.
2004 We introduced HANS-F6, a two-axis linear motor-driven six-axis mechanical
drilling machine.
2007 Our product, UV laser cutting and forming machine, won the National Torch Plan
Project Award (ᆤ ) by the Ministry of Science and Technology
of the PRC (ኪҦஔ௅ ).
2008 We acquired Mason Electronics, one of our major subsidiaries, marking our
expansion into the PCB inspection process business.
2009 We introduced HANS-F6M, a three-axis full linear motor-driven six-axis
mechanical drilling machine.
2010 Our UV laser cutting and forming machine project won the Shenzhen’s 2009
Sci-Tech Innovation Award ( ଉέ̹2009Ҧ௴อᆤ );
HD600, our CO 2 laser drilling machine product, commenced mass production and
sales.
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Year Event
2012 We launched the LDI-8000 laser imaging machine, marking our expansion into the
exposure process business.
Our multi-axis full linear high-speed high-precision PCB drilling machine project
won the First Prize of Shenzhen’s Sci-Tech Progress Award (2012ҦආӉᆤ
ɓഃᆤ).
We introduced MH601, a high-precision testing machine for HDI boards.
2013 We introduced MU3012, our 8x-density universal testing machine, pioneering
“real-density” architecture for high-density HDI board testing.
We were awarded the “Third Excellent National Brand Enterprise” (ۜ
೐Άุ) by China Printed Circuit Association (“ CPCA”).
2014 We were recognized as an “Enterprise Technology Center” ( ΆุҦஔʕː ) jointly
by multiple local authorities in Shenzhen.
We launched UVDRILLER-L650, the UV laser drilling machine.
2016 We acquired Advanced Intelligent Machine Co., Ltd. (ʮ
̡), marking our expansion into FPC and rigid-flex boards attachment equipment
products.
2017 We launched HANS-F6MH, a large-format 6-axis mechanical drilling machine
featuring high rigidity and dual-table design.
We launched HD600F2, a fully upgraded laser drill model featuring dual-beam and
dual-table design.
We were awarded the “Fourth Excellent National Brand Enterprise” (ۜ
೐Άุ) by CPCA.
2018 We released MH701, a high-precision testing machine for substrate testing.
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Year Event
2019 We launched the multi-wavelength solder mask exposure machine LDI-S30,
entered the solder mask exposure equipment market, and completed the layout of
PCB multi-process exposure equipment.
We launched the ultra-large table six-axis independent mechanical drilling machine
HANS-F6XHS that can be equipped with a CCD vision system to meet the PCB
board processing needs of 5G communication infrastructure.
2020 We completed the development of new laser drilling machine, providing
innovational resolution in the industry for mSAP technology.
2021 We launched a new concept of automatic loading and unloading mechanical
drilling machine.
We were awarded the Guangdong Provincial Science and Technology Progress
Award and the Shenzhen Municipal Science and Technology Progress Award.
2022 We were listed on the Shenzhen Stock Exchange (stock code: 301200).
Our mechanical drilling machine won the 7th batch of “National Individual
Champion Product (ۜcertification.
2023 We successfully launched 2.5D/3D advanced packaging FC-BGA substrate layer
micro-hole high-efficiency and high-precision processing new laser drilling
machine equipment DRD1030-4G.
2024 We were recognized as “Guangdong Industrial Design Center” (ʕ
ː) by the Guangdong Provincial Department of Industrialization and Information.
Our mechanical drilling equipment HANS-F6MH and the laser forming equipment
HRD400A were selected as “Guangdong Province Famous and Excellent High-tech
Products in 2023” by the Guangdong High-tech Enterprise Association.
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MAJOR SUBSIDIARIES
As of the Latest Practicable Date, we had 14 subsidiaries. The following sets forth
information about our subsidiaries that have made a material contribution to our operating results
during the Track Record Period:
Name
Place of
Incorporation
Date of
Establishment
Equity interest
attributable to
our Group
Principal business and
activities
Mason Electronics ... PRC November 17,
1999
100% Research, development,
production and sales
of PCB testing
equipment
Xinfeng CNC ...... PRC November 15,
2022
100% Research, development,
production and sales
of PCB specialized
equipment
Asia Foundation .... PRC January 14,
2000
100% Park operation
For further details of the changes in the share capital of our subsidiaries, please refer to
“Appendix VI — Statutory and General Information — 1. Further Information about our Group —
C. Further Information about Our Subsidiaries.”
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MAJOR SHAREHOLDING CHANGES OF OUR COMPANY
Early Development of our Company and Conversion into a Joint Stock Limited Company
Our Company, then known as Shenzhen Han’s CNC Technology Limited (߅
ʮ̡ ), was established on April 22, 2002 in Shenzhen, PRC by Han’s Laser, a member of
the Controlling Shareholders Group, HAN Jinlong (Ꮂ) and LUO Huicai ( ᖯึʑ), both being
early investors of our Company and Independent Third Parties, with an initial registered capital of
RMB3 million. Upon incorporation, our Company was held as to 80%, 10% and 10% by Han’s
Laser, HAN Jinlong and LUO Huicai, respectively.
Upon the completion of several rounds of share transfers and capital injection, the registered
share capital of our Company reached RMB100 million in December 2007, owned as to 99.10%
and 0.90% by Han’s Laser and Dazu Holdings, respectively. Our share capital remained unchanged
until our conversion into a joint stock company with limited liability in November 2020.
In November 2020, our Company was converted from a limited liability company into a joint
stock company with limited liability, with its registered share capital increasing from RMB100
million to RMB359.1 million, owned as to 99.10% and 0.90% by Han’s Laser and Dazu Holdings,
respectively.
Listing on the Shenzhen Stock Exchange
In February 2022, we completed the listing of our A Shares on the ChiNext Market of the
Shenzhen Stock Exchange (stock code: 301200) (the “ A-Share Listing ”). In the A-Share Listing,
we issued an aggregate of 42,000,000 A Shares, accounting for 10% of our Company’s then
enlarged share capital immediately following completion of the A-Share Listing. Immediately
following the completion of the A-Share Listing, our registered share capital increased to
RMB420,000,000 comprising 420,000,000 Shares, and Han’s Laser and Dazu Holdings directly
owned approximately 84.73% and 0.77% of our Company’s then share capital, respectively.
MAJOR ACQUISITION AND DISPOSAL
We had not conducted any acquisitions, disposals or mergers during the Track Record Period
and up to the Latest Practicable Date that we consider material to us. We complied with the
requirements under Rule 4.05A of the Listing Rules in respect of all acquisitions during the Track
Record Period.
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OUR LISTING ON THE SHENZHEN STOCK EXCHANGE AND REASONS FOR THE
LISTING ON THE STOCK EXCHANGE
Since February 2022, our Company has been listed on the Shenzhen Stock Exchange. Since
the beginning of the Track Record Period and up to the Latest Practicable Date, our Directors
confirmed that the Company has been in compliance with the rules of the Shenzhen Stock
Exchange and other applicable securities laws and regulations of the PRC in any material respect,
and, to the best knowledge of our Directors having made all reasonable enquiries, there were no
matters constituting material information requiring disclosure or should be brought to the
investors’ attention in relation to our compliance record on the Shenzhen Stock Exchange. Our
PRC Legal Advisor is of the view that the confirmation of our Directors above with regard to our
compliance record is accurate and reasonable. Furthermore, as advised by our PRC Legal Advisor,
the proposed listing of our Company on the Hong Kong Stock Exchange by way of issue of H
Shares is not subject to the approval of shareholders of Han’s Laser on the basis that (i) our
Company completed the spin-off from Han’s Laser and listing on the Shenzhen Stock Exchange on
February 28, 2022 and hence the relevant spin-off regulations which require shareholders’ approval
of Han’s Laser are not applicable to the Listing and the Global Offering; (ii) the proposed issue of
H Shares by our Company does not exceed the threshold for requiring shareholders’ approval of
Han’s Laser pursuant to the relevant stock exchange regulations and articles of association of
Han’s Laser. Based on the independent due diligence conducted by the Sole Sponsor, nothing has
come to the Sole Sponsor’s attention that would cause them to disagree with our Directors’
confirmation that the Company has been in compliance with the rules of the Shenzhen Stock
Exchange and other applicable securities laws and regulations of the PRC in any material respect
since the beginning of the Track Record Period and up to the Latest Practicable Date.
Our Company seeks to be listed on the Stock Exchange in order to provide further capital for
the development and expansion of our business, further strengthen our business profile and
advance our internationalization strategy, optimize our international brand image, and better attract
overseas investors and talents. See “Business — Our Strategies” and “Future Plans and Use of
Proceeds” for more details.
EMPLOYEE SHARE INCENTIVE SCHEME
In order to improve our Group’s long-term incentive mechanism, attract and retain
outstanding talents, fully mobilize the enthusiasm of our Group’s key employees, we adopted the
2023 Restricted Share Incentive Scheme. On May 21, 2025, the share capital of our Company
increased from RMB420,000,000 to RMB425,509,152 as a result of the issuance of 5,509,152 A
shares upon the vesting of the Share Awards granted under the 2023 Restricted Share Incentive
Scheme. For details, see “Appendix VI — Statutory and General Information — 4. Our Incentive
Scheme” in this Prospectus.
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PUBLIC FLOAT AND FREE FLOAT
Satisfaction of the Public Float Requirement
Rule 8.08(1) (as amended and replaced by Rule 19A.13A) of the Listing Rules provides that,
where a new applicant is a PRC issuer with other listed shares at the time of listing, this will
normally mean that the portion of H shares for which listing is sought that are held by the public,
at the time of listing, must (a) represent at least 10% of the issuer’s total number of issued shares
in the class to which H shares belong; or (b) have an expected market value of not less than
HK$3,000,000,000.
Our A Shares are listed on the Shenzhen Stock Exchange. The total number of the H Shares
to be issued pursuant to the Global Offering represents approximately 10.60% of the total issued
share capital of our Company (before any exercise of the Over-allotment Option). Immediately
following the completion of the Global Offering (before any exercise of the Over-allotment
Option), the total number of the H Shares expected to be held by the public represents
approximately 10.60% of the total issued share capital of our Company, which is higher than the
prescribed percentage of H Shares required to be held in public hands of 10% under Rule
19A.13A(2)(a) of the Listing Rules, thereby satisfying Rule 8.08(1) (as amended and replaced by
Rule 19A.13A) of the Listing Rules.
Satisfaction of the Free Float Requirement
Rule 8.08A (as amended and replaced by Rule 19A.13C) of the Listing Rules provides that,
where a new applicant is a PRC issuer with other listed shares at the time of listing, this will
normally mean that the portion of H shares for which listing is sought that are held by the public
and not subject to any disposal restrictions (whether under contract, the Listing Rules, applicable
laws or otherwise), at the time of listing, must: (a) represent at least 5% of the total number of
issued shares in the class to which H shares belong at the time of listing, with an expected market
value at the time of listing of not less than HK$50,000,000; or (b) have an expected market value
at the time of listing of not less than HK$600,000,000. The Company will satisfy the free float
requirement under Rule 8.08A (as amended and replaced by Rule 19A.13C) of the Listing Rules.
HISTORY AND CORPORATE STRUCTURE
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CORPORATE AND SHAREHOLDING STRUCTURE
Corporate and shareholding structure immediately before the Global Offering
The following diagram illustrates a simplified corporate and shareholding structure of our Group immediately prior to the completion
of the Global Offering (assuming that no other changes are made to the issued share capital of our Company between the Latest Practicable
Date and the Listing):
Our Company
Han’s Laser(1)
(PRC)
Other A Shareholders
of our Company
Mr. Gao(1) Dazu Holdings(1)
(PRC)
Other A Shareholders
of Han’s Laser

(PRC)
 Xinfeng CNC
(PRC)
HANS CNC SINGAPORE
PTE LTD.
(Singapore)
Shanghai Han's Machinery Co., Ltd.
(ʮ̡)
(PRC)
Rayleigh Taide(2)
(PRC)


 Mason Electronics
(PRC)
100% 100%
15.61% 83.63% 0.76%
74.93% 9.36% 15.71%
 100%

HAN's Mason Electronics (HK)
Co., Limited
ʮ̡
(Hong Kong)

100%
100%
Asia FoundationAdvanced Intelligent Machine Co., Ltd.
(ʮ̡)
(PRC)

(PRC)

   Han’s Microelectronics(3)
(PRC)




Suzhou MASON Electronics
Testing Co., Ltd.
(ʮ̡)
(PRC)



Hong Kong Mason Electronics
Co., Limited
(ʮ̡)
(Hong Kong)
 Mason Electronics (Xinfeng)
Co., Ltd.
ʮ̡
(PRC)
HANS CNC TECHNOLOGY
(THAILAND) CO., LTD.(4)
(Thailand)
100% 100% 70% 70%
100% 100%  100%
99%

100%
	Vietnam)
HANS CNC TECHNOLOGY
COMPANY LIMITED
(VIETNAM)
Notes:
(1) As of the Latest Practicable Date, Dazu Holdings was directly held as to 99.875% and 0.125% by Mr. Gao and Han’s Global, which was beneficially and wh olly
owned by Mr. Gao, respectively. The 3,231,900 A Shares directly held by Dazu Holdings were pledged to Shenzhen High Tech Investment and Financing Guar antee
Co., Ltd. (ʮ̡ ) as security for financings of Dazu Holdings (the “ Share Pledge ”). For more details, see “Substantial Shareholders.”
HISTORY AND CORPORATE STRUCTURE
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Each of Mr Gao, Dazu Holdings and Han’s Laser is subject to an undertaking, pursuant to which: (i) neither Dazu Holdings nor Han’s Laser shall transfer, entrust
another party to manage, or propose to the Company to repurchase the Company’s A Shares held by them, and (ii) Mr Gao shall maintain his actual control ov er the
Company and procure Han’s Laser to comply with the aforesaid undertaking (the “ Lock-Up Undertakings ”). The Lock-Up Undertakings will be effective for a
period of 36 months subject to an extension of six further months in the event that the closing price of the Company’s A Shares is lower than the issue pric eo ft h e
Company’s A Shares on the Shenzhen Stock Exchange (the “ Issue Price ”) in the 20 consecutive trading days within six months after the Company’s A-Share Listing
or at the end of the six months after the Company’s A-Share Listing. The Lock-Up Undertakings expired on August 27, 2025. In addition to the aforesaid re strictions,
for a period of two years following the expiration of the Lock-Up Undertakings, the price at which any A Shares are disposed of by Dazu Holdings and Han’s Laser
shall not be less than the Issue Price. As advised by our PRC Legal Advisor, as the Lock-Up Undertakings did not restrain any share pledge activities, th e Share
Pledge granted by Dazu Holdings was not in violation of the Lock-Up Undertakings and is in compliance with the laws and regulations of the PRC.
(2) Rayleigh Taide is a limited liability company incorporated in the PRC on August 1, 2022. As of the Latest Practicable Date, Rayleigh Taide was owned as to 70% by
our Company, and as to 28% and 2% by LIN Dong (؇؍and YANG Jiali ( เԳᘆ), respectively, both of which being Independent Third Parties.
(3) Han’s Microelectronics is a limited liability company incorporated in the PRC on June 7, 2021. As of the Latest practicable Date, Han’s Microelect ronics was held as
to 70.00% by our Company, and as to 14.45%, 8.05% and 7.50% by Shenzhen Zuxin Chuangzhi Investment Enterprise (Limited Partnership) (௴౽ҳ༟Ά
ุ(Υྫ)) (“ Zuxin Chuangzhi ”), Shenzhen Zuxin Chuangsi Investment Enterprise (Limited Partnership) (ҳ༟Άุ (Υྫ)) (“ Zuxin
Chuangsi ”) and Mr. YANG Chaohui ( เಃሾ), our chairperson of the Board, executive Director and general manager, respectively. Zuxin Chuangzhi is a limited
partnership established under the laws of the PRC and is held as to (1) 0.01% by Shenzhen Zuxin Huifu Investment Consulting Co., Ltd. (ිబҳ༟ፔ༔
ʮ̡, the “ Zuxin Huifu ”), as general partner, which is held as to 96.50% by Ms. WANG Jun (ࠏand 3.50% by Ms. ZHOU Yuanyuan ( մᎯᎯ), each an
employee of the Group and an Independent Third Party, and (2) 99.90% by four limited partnerships which are all employee shareholding platforms, as li mited
partners. Zuxin Chuangsi is a limited partnership established under the laws of the PRC and is held as to (1) 0.025% by Zuxin Huifu, as general partner, a nd (2)
99.975% by two limited partnerships which are both employee shareholding platforms, as limited partners. Han’s Microelectronics does not constitu te a principal
subsidiary of our Company for the purposes of Rules 17.13 to 17.15 of the Listing Rules as its revenue, profits or total assets do not account for 75% or mo re of
those of our Group under the percentage ratios in each of the years ended December 31, 2022, 2023 and 2024 and the ten months ended October 31, 2025.
(4) As of the Latest Practicable Date, the remaining 1% equity interest in HANS CNC TECHNOLOGY (THAILAND) CO., LTD. was held by ZHENG Zhiwei ( ቍқਃ),
an Independent Third Party.
HISTORY AND CORPORATE STRUCTURE
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Corporate and shareholding structure immediately following completion of the Global Offering
The following diagram illustrates the simplified corporate and shareholding structure of our Group immediately following completion
of the Global Offering, assuming that the Over-allotment Option is not exercised, and no other changes are made to the issued share capital
of the Company between the Latest Practicable Date and the Listing:

99% 100%


Our Company
Han’s Laser
(PRC)
Other A Shareholders
of our Company
Mr. Gao Dazu Holdings(1)
(PRC)
Other A Shareholders
of Han’s Laser

(PRC)
 Xinfeng CNC
(PRC)
HANS CNC SINGAPORE
PTE LTD.
(Singapore)
Shanghai Han's Machinery Co., Ltd.
(ʮ̡)
(PRC)


 Mason Electronics
(PRC)
100% 100%
74.93% 9.36% 15.71%
 100%

HAN's Mason Electronics
(HK) Co., Limited
ʮ̡
(Hong Kong)

100%
100%
Asia FoundationAdvanced Intelligent Machine Co., Ltd.
(ʮ̡)
(PRC)

(PRC)



Han’s Microelectronics(3)
(PRC)




Suzhou MASON Electronics
Testing Co., Ltd.
(ʮ̡)
(PRC)



Hong Kong Mason Electronics
Co., Limited
(ʮ̡)
(Hong Kong)
 Mason Electronics (Xinfeng)
Co., Ltd.
ʮ̡
(PRC)
100% 100% 70% 70%
100% 100%  100%

H Shareholders
13.95%10.60% 74.77% 0.68%
Rayleigh Taide(2)
(PRC)
	Vietnam)
HANS CNC TECHNOLOGY
COMPANY LIMITED
(VIETNAM)
HANS CNC TECHNOLOGY
(THAILAND) CO., LTD.(4)
(Thailand)
Notes:
(1)−(4)Please refer to the details contained in the sub-section headed “Corporate and Shareholding Structure — Corporate and Shareholding structure immed iately before the
Global Offering” above.
HISTORY AND CORPORATE STRUCTURE
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OVERVIEW
Who We Are
We are a leading specialized PCB production equipment solution provider in China. We
operate in the specialized PCB equipment industry, serving as a key infrastructure provider for a
variety of downstream industries. According to CIC, we have a product portfolio, covering nearly
all major PCB production processes such as drilling, photolithography, lamination, formation and
testing. We focus on improving the industry value chain and providing comprehensive solutions
with quality products to customers. Our customers include 80% of the enterprises in the Prismark
Global PCB Top 100 Enterprises List in 2024. Leveraging our advanced R&D capabilities,
comprehensive product matrix and stable customer relationships, we have been consistently ranked
first in terms of revenue for 16 consecutive years in the specialized equipment and instrument list
published by CPCA since 2009. According to CIC, we were the China’s largest specialized PCB
production equipment manufacturer in terms of revenue in 2024, with a market share of 10.1% in
China. Our products have received wide customer recognition for their performance and value. For
example, our drilling equipment was awarded the “National Individual Champion Product (ڿ
ۜcertification in 2022 and maintained leading market share in 2024.
We have made a number of significant achievements across various business sectors:
RMB3,343.1 million
2024 Revenue
RMB299.6 million
2024 Net Proﬁt
RMB451.7 million
2024 Adjusted Net Proﬁt
(non-IFRS measure)
1,100+
(2)
registered patents
300+
(2)
software copyrights
60+
(2)
trademarks
900+
(2)
employees
in the R&D team
over 30%
(1)
 of market
share in drilling equipment
sector in China’s PCB equipment
industry
Notes:
(1) In terms of revenue from drilling equipment in China in 2024, according to CIC.
(2) As of the Latest Practicable Date.
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With our innovative business development model, we drive the evolution of the PCB industry
through multi-dimensional collaboration across application scenarios, technologies, supply chains,
equipment and materials, products, production processes and customers. We strive to “become the
most respected and trusted PCB equipment service provider in the world,” creating value for
customers through technological innovation and supporting industry upgrades with global business
layout. We are committed to fully embracing AI, leveraging AI to optimise our business structure
and facilitate the development of the AI industry. We aim to drive organizational transformation,
redefine work processes, enhance product development, innovate production processes and
improve equipment performance through AI technology. We are committed to delivering quality
integrated solutions for multi-layer boards, HDI boards, and large-size packaging substrates,
thereby facilitating the development of AI from a hardware perspective. Building on the
technologies and experience we accumulated over our more than two decades of business
operation, we are well positioned to leverage AI to further strengthen our technology capabilities,
to expand our product portfolio, and to help our customers in the electronics industry to advance
into the next generation of high-end production.
Development Phases
We have experienced the following four phases since our establishment:
Phase I
Start-up and diversification of
business layout (2002-2012) ....
We continuously overcame technical bottlenecks and
created an initial portfolio of equipment covering major
PCB production processes. At the outset of our operations,
we focused on the R&D of drilling equipment, which lies at
the core of PCB production, in order to build a well-known
brand in China. We then gradually expanded our product
portfolio to include equipment for photolithography and
formation processes. In 2008, we acquired Shenzhen Mason
Electronics Co., Ltd. and extended our business to PCB
testing equipment. After this acquisition, we established an
initial product portfolio that covers major processes of PCB
production, including drilling, photolithography, formation
and testing.
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Phase II
Diversified comprehensive
solutions (2013-2017) .........
We focused on further developing a comprehensive product
portfolio. We actively fostered close cooperative
relationships with our customers, focusing on long-term
value. We enriched our product portfolio with a full range
of products such as mechanical drilling equipment, thus
forming a more comprehensive product matrix.
Phase III
Product portfolio and technology
expansion (2018-2021) ........
We focused on growing our customer base with more
products and technologies. Our product portfolio and sales
experience enabled us to enter major global PCB supply
chains. We began offering customization in order to
enhance customer loyalty. We strategically decided to
develop packaging substrates processing equipment and
new laser processing technologies.
Phase IV
Product enhancement since
Listing (2022-present) .........
In 2022, we were listed on the Shenzhen Stock Exchange’s
ChiNext Market. We have achieved innovation in
equipment design and production technologies, such as the
single-table double-station operation system, new laser
processing technology, and innovative solutions for
packaging substrates. We further expanded our presence in
Southeast Asian countries, such as Thailand. We also
launched PCB lamination equipment solution in 2024,
enriching our product portfolio to cover nearly all major
processes of PCB production.
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Our Products
We primarily engage in the R&D, production and sales of specialized PCB production
equipment and solutions. Our products cover nearly all major PCB production processes such as
drilling, photolithography, lamination, formation and testing, making our product portfolio the
most comprehensive among players in the global specialized PCB equipment industry. With over
20 years of expertise in high-speed and high-precision motion control, precision machinery,
electrical engineering, software algorithms, advanced optical systems, laser technology, image
processing and electronic testing, we have developed competitive process solutions for the PCB
industry. Our main products have achieved advanced industry standards in terms of performance
and reliability.
The following chart sets forth our key products and the roles they play along the major PCB
production processes:
Incoming Material
Photolithography
(Inner Layer)
Testing
(Outer Layer Etching)
Photolithography
(Solder Mask & Legend)
Drilling
Electroplating
Photolithography
(Outer Layer)
Lamination
/g132Laser Direct Imaging (LDI) System
/g132Developing-Etching-Stripping (DES)
Equipment
/g132Automated Optical Inspection(AOI)
Equipment
/g132Brown Oxide Line
/g132Cold/Hot Press Machine
/g132X-Ray Drilling Target Alignment
System
Laser Drilling Machine
Mechanical Drilling Machine
Drill Bit Grinder Equipment
/g132Plated Through Hole (PTH)
Deposition Line
/g132Vertical Continuous Plating (VCP)
Line
/g132LDI System
/g132Curing Oven Line
/g132Legend Inkjet Printer
/g132Etching-Stripping Line
/g132Stripping-Etching-Tin Stripping Lin
/g132AOI Equipment
/g132Dry Film Laminator
/g132LDI System
/g132Developing Line
Our Business
CoverageNote: The related manufacturing
equipment
Formation
 Testing
(Final Quality )
Attachment
(Packaging and Attachment)
/g132Mechanical formation machine
/g132VCUT Beveling Machine
/g132Automated Sorting & Packaging
System
/g132Attachment equipment
/g132
/g132
/g132
Electrical Test Equipment
Automated Visual Inspection (AVI)
Equipment
/g132
/g132
OUR STRENGTHS
We Achieved Broad Customer Recognition in the Specialized PCB Equipment Industry.
We are a leading specialized PCB production equipment solution provider in China, having
ranked first in the specialized equipment and instrument list published by CPCA for 16
consecutive years since 2009. Through continuous breakthroughs in key technologies, our
specialized PCB production equipment spans nearly all major PCB production processes, such as
drilling, photolithography, lamination, formation and testing, differentiating ourselves among other
BUSINESS
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market players who focus on isolated processes or product types. Our comprehensive product
portfolio provides customers with comprehensive solutions. According to CIC, we were the
China’s largest specialized PCB production equipment manufacturer in terms of revenue in 2024,
with a market share of 10.1% in China. We also maintain industry-leading positions in various
specialized sectors of the China’s PCB equipment industry. For example, our drilling equipment
enjoyed a market share of over 30% in China in terms of 2024 revenue in China, according to
CIC.
Leveraging our strong R&D capabilities and extensive experience in advanced production, we
are well-positioned to capitalize on the significant growth opportunities brought by the trend of
PCB industry technology upgrade, to drive the development of more advanced PCB production
equipment, to bring more value to the global PCB and electronics industries, and to achieve
long-term sustainable growth.
We Are a Key Infrastructure Provider in the Upstream of the AI Server and Intelligent
Electric Vehicle Industry Value Chain.
We operate in the specialized PCB equipment industry, serving as a key infrastructure
provider for a variety of downstream industries. According to CIC, the global market size of the
specialized PCB equipment increased from approximately US$5,840 million in 2020 to
approximately US$7,085 million in 2024, representing a CAGR of 4.9%, and is projected to reach
approximately US$11,388 million at a CAGR of 8.6% from 2025 to 2029. In addition, the market
size of China’s specialized PCB equipment industry increased from approximately US$3,306
million in 2020 to approximately US$4,111 million in 2024, with a CAGR of 5.6%, and is
expected to grow at a CAGR of 8.2% from 2025 to 2029, reaching approximately US$6,495
million by 2029. We believe with the robust growth in the specialized PCB equipment industry,
our commitment to innovation and quality positions us well to capitalise on these growth
opportunities, ensuring we remain at the forefront of the PCB equipment sector.
More specifically, we believe the growth in specialized PCB industry is primarily driven by
increases in demand for AI and automotive intelligence as underlying technologies continue to
develop.
AI servers. Driven by the continued in-depth application of generative AI, physical AI, and
5G communication technology, as well as the rapid development of the electronic information
technology industry, the global market demand for PCB products such as high-multilayer boards,
HDI boards, packaging substrates and multi-layer FPCs are quickly expanding. Such growth in
demand for high-value PCB products is, in turn, driving market expansion of specialized PCB
production equipment. According to Prismark, the fastest-growing electronic terminal sectors in
the next few years are expected to be servers and storage devices, automotive electronics, mobile
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phones, computers and other consumer electronics. AI-related industries, such as servers and
switches for AI infrastructure, rely on advanced PCBs, and are emerging as new drivers for the
future growth of the PCB industry. Investment in high-multilayer boards and SLP, along with
increased demand and technical requirements, is expected to promote the growth of specialized
PCB production equipment.
Intelligent electric vehicles. The New Energy Vehicle Industry Development Plan ( อঐ๕ӛ
஝ྌ ) (2021-2035) issued by the State Council explicitly envisages that by 2025, the
sales volume of NEVs will reach approximately 20% of the total new sales of vehicles. The
electric systems of NEVs, intelligent autonomous driving and the Internet of Vehicles have
significantly increased the cost proportion of electronic components. With Level 3 autonomous
driving widely accepted in China, the computing power of autonomous driving has exceeded
30TOPS, which has significantly promoted the demand for the advanced PCB, especially for HDI
boards used in computing modules. Widespread applications of advanced HDI, mixed-pressure
HDI and other HDI products have increased the demand for lamination equipment, mechanical
drilling equipment, CO
2 laser drilling equipment, hybrid UV+CO 2 laser drilling equipment,
high-resolution LDI equipment and high-precision specialized testing equipment.
Through continuous technology innovation, we launch innovative solutions that align closely
with the technical needs and pain points of players in the various sectors downstream of the PCB
industry, and have received wide recognition from leading market players along the PCB industry
value chain. For example, our self-developed 3D back-drilling and integrated drilling-testing
technologies can achieve ultra-short stubs and ultra-high concentricity as well as mass processing
of high-precision back-drills, which have been well-recognized by industry-leading manufacturers
of high-multilayer boards and generated sales orders. We have also optimized our lamination
equipment products to cater to the lamination of thick copper PCBs, achieving improved quality
performance and customer feedback, thus laying a solid foundation for gaining additional market
share. We believe our commitment to continuous product innovation strengthens our role as a key
infrastructure provider in the industry value chain and our ability to satisfy customers’ needs along
major PCB production processes, and enables us to capitalize on the overall industry growth
opportunities.
Our Platform-Based Technologies and Diverse Product Portfolio Enable Multi-dimensional
Business Synergy.
Platform-Based Technologies : Through independent R&D, we have established core
technologies covering nearly all major PCB production processes, namely drilling,
photolithography, lamination, formation and testing. A number of such technologies are universally
applicable to all major processes, including high acceleration and deceleration linear motor drive
motion control technology, precise mechanical design and advanced assembly technology,
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specialized software platform and core algorithm technology. As such, we are able to effectively
share key technologies in different scenarios and efficiently coordinate our R&D resources in
various sectors, so as to achieve our technological synergy under our well-designed R&D model.
We have also developed specialized technologies tailored to specific product features, including
LDI system design technology, micro blind hole drilling technology, high-precision lightweight
workbench production technology, and multi-scenario high-precision electrical performance testing
technology, to continuously promote transformative upgrades of our products.
Diverse Product Portfolio : We have developed a comprehensive product portfolio for various
specialized sectors of the PCB market, including multi-layer boards, HDI boards, packaging
substrates, FPC and rigid-flex boards, and nearly all major PCB production processes, including
drilling, photolithography, lamination, formation and testing. In particular, our prominent position
in the multi-layer board production sector enables us to provide comprehensive solutions to our
customers, which differentiates us from most comparable market players in the global market, who
may have technology and production capability for a limited number of PCB production processes.
We focus on commercializing our core technologies, such as high-speed and high-precision motion
control, advanced optical systems and laser technology, laying a solid foundation for our flagship
products, such as mechanical drilling, laser drilling, photolithography transfer and final quality
testing equipment. According to CIC, the capital expenditure on the above equipment accounted
for over 50% of the total investment in the PCB industry in 2024. By driving our overall sales
through our competitiveness in our key products, our comprehensive solutions can effectively
reduce customer development and communication costs, improve marketing efficiency, enhance
customer loyalty, and lower customer procurement costs.
Our Business Synergy : With our platform-based technologies and diverse product portfolio,
we have achieved multi-dimensional business synergies.
 Technological Synergy : Our linear motor drive motion control technology, precise
mechanical design and advanced assembly technology and digital virtual simulation
technology are applicable to all of our products, and the adoption of platform-based
technologies under different application scenarios can improve our R&D efficiency.
 Product Synergy : Our comprehensive product portfolio enables us to offer
comprehensive solution to customers. Customers that purchased one type of our
equipment products can also satisfy their need for equipment during other major PCB
production processes by providing our other equipment products, which significantly
reduces their procurement effort, and enhances customer stickiness. One high-quality
product leads attracts customers to explore other products.
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 Equipment and Material Synergy : We collaborate with PCB raw material manufacturers
to jointly determine the optimal processing parameters to enhance processing efficiency
and product quality.
 Process Synergy : We adopt a unified system for data collection, analysis and feedback to
ensure concurrent adjustment and error correction across different PCB production
processes. This ensures efficient coordination throughout downstream customers’
operations. By managing end-to-end data flow, we also apply big data models to
continuously enhance customers’ production process and technical capabilities.
 Scenario Synergy : Our comprehensive product portfolio and deep understanding of
various PCB application scenarios, such as AI servers and intelligent driving vehicles,
expedite customers’ process of achieving mass production when venturing into a new
application scenario, bringing first-mover advantage for customers.
 Supply Chain Synergy : As a leading solutions provider of specialized PCB production
equipment, our economies of scale enhance our bargaining power through bulk purchase
and enable collaborative development with upstream suppliers to expedite our
technology upgrades.
 Customer Synergy : Our downstream customer base covers nearly all mainstream PCB
manufacturers. Recognition from major customers facilitates our continuous expansion
among other PCB customers, making our marketing and product promotion highly
efficient.
We Have Established Strong R&D Capabilities Which Drive Technological Advancement in
the PCB Industry of China and Enhance Our Competitiveness in the Global Market Through
Innovative Technologies.
We have long focused on investment in innovation and have accumulated a vast array of core
technologies that form the foundation of our competitiveness. We implement different R&D
strategies tailored to specific application scenarios. For example, in the standard multilayer board
and HDI board markets, we offer innovative insights, comprehensive solutions and advanced
equipment to enable customers to reduce production costs and respond to the intensifying price
competition in the downstream markets; in the high-multilayer board market, we have enhanced
product performance to meet the quality assurance needs of high-value products, and for SLP,
packaging substrates and advanced packaging substrates, we primarily promote new laser-based
integrated solutions to empower our customers to penetrate into the market of advanced packaging.
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We are committed to building a globally competitive R&D team. As of October 31, 2025, we
had a total of 871 R&D employees, accounting for 27.3% of our total workforce. Among these 871
R&D employees, 74.5% hold a bachelor’s degree or above. Our R&D employees possess diverse
professional backgrounds, covering mechanical design, electrical engineering, electronic
technology, optoelectronics, laser technology, automatic control technology and computer software.
We attach great importance to investment in innovative technologies and solutions. As a
national high-tech enterprise, we have undertaken and completed a number of national, provincial
and municipal level scientific research projects over the past decade, including the R&D of
Programmable Automation Controllers for High-End PCB Manufacturing and Inspection
Equipment, and Application Demonstration Project (ΣPCB̙ᇜ೻ІਗʷછՓ
೯ၾᏐͪ͜ᇍ ), and the R&D of Key Equipment and Control Systems for PCB
Manufacturing, and Application Demonstration (PCB೯ၾᏐͪ͜
ᇍ), among others. With our innovative solutions addressing industry pain points, we have been
awarded the title of “Guangdong Industrial Design Center” (ʕː )b yt h e
Department of Industry and Information Technology of Guangdong Province (ʷ
ᝂ) and have been listed among the top 500 manufacturing enterprises in Guangdong Province. As
of the Latest Practicable Date, we had obtained approximately 1,103 registered patents, 254
invention patents, 369 software copyrights and 68 trademarks in China, securing a leading position
among industry peers. Our invention patents are primarily distributed across our New Laser
Product Center, Mechanical Product Center, and Laser Product Center, and are widely applied in
the production of products from these centers. These invention patents provide us with exclusive
rights to key technologies, enabling us to establish technological barriers, enhance product
differentiation, and strengthen our market position. For the years ended December 31, 2022, 2023,
2024 and the ten months ended October 31, 2024 and 2025, our research and development
expenses amounted to RMB229.7 million, RMB193.6 million, RMB266.8 million, RMB200.7
million and RMB300.0 million, respectively.
Under our efficient R&D model, each product R&D center operates with clear R&D
directions with the collaborative support of expertise from diverse professional backgrounds. Our
in-depth interaction and close partnership with leading PCB manufacturers and key component
suppliers along the industry value chain enable us to stay at the forefront of the specialized PCB
equipment industry. Through continuous breakthroughs in key technologies, we have launched a
number of self-developed products, driving technological improvements in China’s specialized
PCB equipment industry and promoting its global competitiveness.
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Our Customer Base Covers a Majority of Leading PCB Manufacturers in Mainland China,
Collaboratively Leading Industry Development.
Our customers include 80% of the enterprises on Prismark’s Top 100 Global PCB Enterprises
list in 2024, all enterprises on the 2024 CPCA Overall Top 100 list, and over a thousand small and
medium-sized PCB enterprises in China. We have maintained close partnerships with
industry-leading customers, including Zhen Ding Tech, Unimicron, Victory Giant Technology,
Shennan Circuits and Dongshan Precision. With our innovative solutions, we have gained
widespread recognition from global industry-leading PCB manufacturers. We have earned a
number of awards from renowned listed companies in the industry, including the “Gold Supplier”
(೐ԶᏐਠ ) from Shennan Circuits and “Best Innovation Award” ( ௰Գ௴อᆤ ) from Kinwong.
Through close collaboration with PCB manufacturers, we gained up-to-date and practical
insights in relation to PCB application scenarios and connect with global top electronic terminal
brands, enabling us to stay abreast of the latest processes and technical requirements of the
downstream PCB industry. Leveraging our extensive experience in addressing common challenges
across various customer scenarios, we have refined and optimized our products to lead industry
advancements, particularly in specific sectors of the PCB industry. This enhances our core
competitiveness and maximizes value for our customers. Our collaborations foster trust and ensure
long-term, stable partnerships with our customers, resulting in mutually beneficial outcomes.
We Have an Excellent Management Team and a Comprehensive Talent Development
Mechanism.
Our management team has demonstrated exceptional strategic vision and strong management
capabilities throughout our development and contributed to the establishment of our leading
position in the industry. Mr. Yang Chaohui, our chairman and general manager, has over 20 years
of extensive experience in the industry and holds multiple positions in the industry, including the
deputy supervisor (ڗand the chairman of the Special Equipment Branch ( ਖ਼͜ண௪ʱึึ
ڗof CPCA, enjoying a high reputation in the industry. Since our establishment, Mr. Yang
Chaohui’s forward-looking vision and keen industry insights have helped us make remarkable
industry achievements and consolidate and further enhance our market position.
We have formed a visionary, experienced and foresighted management team. Our
management team consists of senior technical personnel with professional backgrounds and rich
experience in specialized PCB production equipment, as well as a profound understanding of
industry developments and trends. Our management team has been working with us for over 10
years, demonstrating strong team cohesion and stability.
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We continuously optimize our talent development mechanism by increasing the proportion of
R&D and sales personnel with diverse industry experience and technical skills, thus accelerating
the R&D progress of our innovative solutions and enhancing relationships with industry-leading
customers. In line with the innovation-driven market environment, we actively recruit high-quality
talent worldwide. We have also established a systematic training system to improve the
professional capabilities and comprehensive qualities of our employees through leadership training,
special training for R&D employees, and general competency training, providing a strong talent
reserve for our innovative and sustainable development.
Our corporate governance and corporate culture are centered on the principle of
“innovation-driven and win-win collaboration” ( ௴อᚨਗd՘Ъ΍ᙊ ) and adhere to the concepts
of standardized operations and sustainable development. We were listed on the Shenzhen Stock
Exchange’s ChiNext Market in 2022 and have maintained a healthy governance framework. In
terms of talent development, we have established a tiered development mechanism. Our “Young
Eagle Program” (ྌ) and “Flying Eagle Program” (ྌ) are designed to improve the
quality of our key talent. We have also implemented a long-term incentive mechanism covering
our management team and key R&D employees, and we adhere to the principle of
“performance-driven and benefit-sharing” (ଘˏeлू΍Ԯ ), which tightly links remuneration
packages with respective R&D contributions and our performance. We believe that a sound talent
development mechanism not only ensures a strong talent pool for our quality, sustainable and
international expansion, but also enables us to stand out among the fierce competition and
maintain our leading industry position.
OUR STRATEGIES
We strive to “become the most respected and trusted PCB equipment service provider in the
world” and will carry out the following strategies:
We Plan to Anchor Our Strategy in Emerging Sectors such as AI and Intelligent NEVs,
Collaborating Closely with End-customers Through Joint R&D Laboratories and Full-Chain
Support from Process Validation to Mass Production.
Driven by the widespread application of AIGC and 5G-A communication technologies, AI
servers, autonomous driving computing modules, AI smartphones and optical modules, we have
addressed the increasing demand for high-speed high-multilayer boards (ultra-high-multilayer or
high-multilayer HDI boards) and SLP. We have developed specific equipment for these application
scenarios, and will continue to focus on these emerging sectors and closely work with customers to
develop new products.
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We believe we are well-positioned to swiftly meet the production needs of customers in
emerging sectors, and plan to closely collaborate with customers to conduct further R&D and
strengthen our customer base. For example, in terms of the AI industry, we intend to capitalize on
the emerging demand for specialized processing equipment for high-value PCB products, such as
high-multilayer HDI (HLC+HDI) boards for servers, 800G/1.6T high-speed optical modules, and
SLP for AI smartphones. For producing high-multilayer HDI boards, PCB manufacturers need to
address specific technical demands for diverse drilling types, fine circuits and high reliability. As
such, we plan to enhance our drilling product portfolio and offer new mechanical drilling
equipment, laser drilling equipment, digital imaging equipment and testing equipment with
advanced technical capabilities. These new products are expected to be able to process advanced
HDI for next-generation AI servers and ultra-high-multilayer PCBs for 800G switches while
ensuring signal integrity. In response to the growing adoption of SLP in 800G+ optical modules
and AI smartphones, we aim to continue to expand the application scope of new laser processing
technologies to meet the technical requirements for smaller holes and higher-precision formats. We
strive to break the bottleneck in micro-hole apertures of traditional CO
2 laser drilling equipment
and the tolerance limit of mechanical routing equipment to improve the production yield of SLP.
We also plan to actively develop mSAP processing technology to meet the demand for processing
of next-generation SLP RCC materials in smaller sizes.
In terms of the NEV industry, we plan to seize the demand for autonomous driving computing
modules and automotive-grade HDI boards, and promote the application of hybrid UV+CO
2 laser
drilling technology in processing high-frequency materials. We intend to establish joint
laboratories with auto brands to deepen R&D collaboration, optimize the infinite splicing
processing mode for CCS harness FPCs in NEVs, and empower our customers to achieve
full-chain integration from process verification to mass production, thereby facilitating the
intelligent upgrade of the automotive industry.
By actively planning business layout in high-value, high-growth emerging sectors such as AI
and NEVs, as well as focusing on leading customers in these emerging sectors, we expect to
reshape our position in the global value chain of the high-precision PCB production industry,
create equipment and production line standards that fit different sectors, and ultimately accelerate
our transition from “applying technologies” to “defining next-generation PCB production.”
We Plan to Expand Our Global Business Presence.
Based on China’s core position in the global PCB industry and the advantages of its
well-established domestic electronic information industry chain, we are committed to further
strengthening our global R&D and operational capabilities and enhancing our production capacity
for high-end PCB equipment. This layout will enable us to fully leverage local industrial cluster
effects, deeply integrate R&D, production and market resources, and further consolidate our
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competitive advantages in the global PCB equipment sector. We strive to enter the supply chain of
leading overseas substrate manufacturers and enhance our brand recognition among renowned
end-customers in overseas markets.
In addition to establishing a customer value-added service center in Thailand to offer prompt
support to PCB manufacturers in Thailand and other regions in Southeast Asia, we are expanding
our sales networks in Malaysia and Vietnam to capitalize on the global shift of the PCB industry to
Southeast Asia. Through our sales network, we aim to swiftly understand market trends and needs
of PCB manufacturers and enhance our overseas customer acquisition efficiency and maintenance
efforts.
Our global expansion strategy is expected to enhance our brand image, attract top talent
worldwide and build a multi-regional collaborative R&D system. Through the expansion of
overseas sales networks and participation in international exhibitions, we expect to strengthen our
leading position and influence in the global high-end specialized PCB production equipment
market and establish a benchmark for the international competitiveness of Chinese smart
production.
With the continuous optimization of our R&D, production and service systems, we expect our
annual production capacity for high-end specialized PCB equipment to reach approximately 260
units, including mechanical processing equipment, new laser processing equipment, high-resolution
laser direct imaging equipment, and high-precision inspection equipment. This will enable us to
better support the rapid growth in demand from both domestic and overseas markets and generate a
significant positive impact on our overall business performance.
We Plan to Further Enhance Our R&D Capabilities on Key Technologies, Optimizing
Production Processes in the Multilayer Board Sector and Expanding to the Advanced
Packaging Sector.
Equipment for multilayer boards is our core business. By exploring new value in the
multilayer board market, we strive to continuously optimize the overall operational costs of
customers and enhance our existing leading position in this sector.
 In terms of depth, in addition to our focus on enhancing the efficiency, stability,
automation and intelligence of our equipment, we plan to provide innovative process
solutions and upgrade existing equipment forms and process paths. Based on the
technical characteristics of PCBs in specific scenarios, we plan to develop optimized
solutions that cover processing equipment, process parameter formulations, processing
tools and raw and auxiliary materials, thereby continuously reducing overall operational
costs for customers.
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 In terms of breadth, we aim to explore the value of the upstream and downstream
processes of existing products and constantly expand our product portfolio. In addition
to optimizing our products for drilling, circuit and solder mask photolithography,
formation and electrical performance testing, we aim to enhance the competitiveness of
our products for lamination and optical inspection. We aim to provide more diverse
products for customers and reduce the equipment procurement, operation and
management costs of PCB manufacturers, while minimizing the impact on our revenue
as a result of significant fluctuations in the demand for a particular type of equipment.
We are committed to penetrating the market of specialized equipment for packaging
substrates and providing innovative solutions to our customers in the advanced packaging sector.
Such R&D strategy enables us to further deepen our industry presence and foster new profit
drivers. Our self-developed new laser-based integrated solution can be applied in the processing of
advanced packaging such as FC-CSP, FC-BGA, glass substrates, EMIB and FOPLP, and the
corresponding application scenarios include the server chips, such as CPUs, GPUs, FPGAs and
ASICs, for smartphone SoCs, AiP and AI computing scenarios. Some of our specialized equipment
for packaging substrates have passed process tests and supplier certifications from several
renowned domestic and overseas customers. We plan to continue to conduct full-process reliability
verification with our customers, and actively engage with end-customers to promote new solutions
to achieve mass production.
We Plan to Build a Full Lifecycle Service System to Enhance Customer Loyalty and Industry
Influence.
We are committed to providing full lifecycle value-added services to maximize customer
value and achieve mutual growth. With years of experience in the specialized PCB equipment
industry, we have built a robust customer base through our competitive product portfolio, strong
innovation capabilities, and extensive sales experience. We offer 24/7 customer service and appoint
chief service officers for key accounts to coordinate value-added services across all equipment,
continuously improving customer experiences.
We prioritize customer service and have pioneered the chief service officer mechanism in the
specialized PCB equipment industry to provide comprehensive equipment management. Our
AI-powered predictive maintenance system allows real-time monitoring and can issue failure
warnings in advance to ensure that customers’ equipment maintains higher uptime rates. In
overseas markets, we plan to establish localized centers for technical support and spare parts
storage to reduce response times. For existing markets, we intend to offer automation retrofit
services and upgrade equipment to enhance precision, reducing new equipment investment of our
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customers. Additionally, we plan to collaborate with universities to build an industry process
database and open our AI model optimization platform, empowering small and medium-sized
enterprises in their transition to intelligent production.
OUR PRODUCTS
We are a leading specialized PCB production equipment solution provider in China. We
primarily engage in the R&D, production and sales of specialized PCB production equipment,
providing end-to-end process solutions for PCB manufacturers. During the Track Record Period,
we sold our specialized PCB production equipment to over 10 countries and regions. According to
CIC, we ranked first globally in terms of the sales revenue of specialized PCB production
equipment. Our extensive portfolio of production equipment spans various segments of the PCB
industry, and covers various production processes, such as drilling, photolithography, lamination,
formation and testing. Benefiting from our extensive product portfolio, advanced technologies and
strong production capabilities, we are able to adapt quickly to the evolving industry trends and
serve our customers’ diverse needs.
The following chart sets forth our key products and the roles they play along the major PCB
production processes:
Incoming Material
Photolithography
(Inner Layer)
Testing
(Outer Layer Etching)
Photolithography
(Solder Mask & Legend)
Drilling
Electroplating
Photolithography
(Outer Layer)
Lamination
/g132Laser Direct Imaging (LDI) System
/g132Developing-Etching-Stripping (DES)
Equipment
/g132Automated Optical Inspection(AOI)
Equipment
/g132Brown Oxide Line
/g132Cold/Hot Press Machine
/g132X-Ray Drilling Target Alignment
System
Laser Drilling Machine
Mechanical Drilling Machine
Drill Bit Grinder Equipment
/g132Plated Through Hole (PTH)
Deposition Line
/g132Vertical Continuous Plating (VCP)
Line
/g132LDI System
/g132Curing Oven Line
/g132Legend Inkjet Printer
/g132Etching-Stripping Line
/g132Stripping-Etching-Tin Stripping Lin
/g132AOI Equipment
/g132Dry Film Laminator
/g132LDI System
/g132Developing Line
Our Business
CoverageNote: The related manufacturing
equipment
Formation
 Testing
(Final Quality )
Attachment
(Packaging and Attachment)
/g132Mechanical formation machine
/g132VCUT Beveling Machine
/g132Automated Sorting & Packaging
System
/g132Attachment equipment
/g132
/g132
/g132
Electrical Test Equipment
Automated Visual Inspection (AVI)
Equipment
/g132
/g132
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In addition to major PCB production processes such as drilling, photolithography, lamination,
formation and testing, our comprehensive product portfolio also covers various specialized sectors
of the PCB equipment industry, including multi-layer boards, HDI boards, packaging substrates,
FPC and rigid-flex boards. This enables us to provide differentiated, comprehensive solutions for
customers across different sectors of the PCB industry.
The following chart sets forth our product offering for various production processes and for
different types of PCBs for use in different downstream market segments.
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The following table sets forth the details of the revenue, sales volume and average selling price (net of tax) of our products by PCB
production process for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Revenue
Sales
Volume
Average
Selling
Price Revenue
Sales
Volume
Average
Selling
Price Revenue
Sales
Volume
Average
Selling
Price Revenue
Sales
Volume
Average
Selling
Price Revenue
Sales
Volume
Average
Selling
Price
RMB’000 Unit RMB’000/Unit RMB’000 Unit RMB’000/Unit RMB’000 Unit RMB’000/Unit RMB’000 Unit RMB’000/Unit RMB’000 Unit RMB’000/Unit
Drilling equipment .......... 1,666,776 2,514 663 818,051 1,129 725 2,100,645 3,119 674 1,619,065 2,569 630 3,095,604 4,499 688
Photolithography equipment ..... 403,646 132 3,058 189,155 79 2,394 340,306 141 2,414 288,061 119 2,421 247,547 103 2,403
Testing equipment .......... 284,312 519 548 197,561 400 494 274,139 446 615 219,857 359 612 383,632 501 766
Formation equipment ......... 214,864 463 464 152,323 289 527 254,138 596 426 200,959 477 421 237,581 521 456
Attachment equipment ........ 23,603 74 319 54,778 183 299 81,940 206 398 64,796 168 386 95,437 208 459
Lamination equipment ........ —————— 9,804 2 4,902 4,760 1 4,760 — — —
Total/Overall ............ 2,593,201 3,702 701 1,411,868 2,080 679 3,060,972 4,510 679 2,397,498 3,693 649 4,059,801 5,832 696
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Drilling Equipment and Solutions
The drilling process is a mission-critical stage in PCB production, enabling the creation of
conductive vias that realize interlayer electrical connectivity in multi-layer board architectures
through precision metallization plating. Aligning with industry standards, we provide both
mechanical drilling equipment for apertures with a diameter ≥0.15mm utilizing proprietary
micro-drill bit technology, and laser direct drilling systems for apertures with a diameter <0.15mm
leveraging non-contact laser technology to achieve high-precision machining of tiny holes.
Our innovative drilling solutions, such as automated operations and dual-axis simultaneous
processing, enhance efficiency by up to 100% compared to traditional solutions, creating a
cost-efficient approach within the specialized PCB equipment industry. We have consistently led
the market in sales volume, providing downstream customers with comprehensive solutions that
cater to evolving PCB structures, from multilayer boards to HDI boards.
Driven by trends in AI and automotive electrification, PCB designs have evolved to
incorporate complex via structures, including through holes, blind vias, back drilling, and
interlayer vias. As hole diameters continue to shrink and aspect ratios increase, our drilling
equipment is also upgraded to meet these heightened precision demands. For back drilling, we
utilise a 3D measurement process with integrated drilling and measurement capabilities, achieving
high-quality processing with Z-axis depth control of 4±2 mil and XY-axis precision of D+4 mil.
For blind vias, we offer a range of laser processing equipment, employing next-generation lasers
for micro-apertures and CO
2 lasers for larger apertures, providing our clients with optimal product
combinations tailored to their specific needs. In 2022, 2023, 2024 and the ten months ended
October 31, 2024 and 2025, we sold 2,514, 1,129, 3,119, 2,569 and 4,499 units of drilling
equipment, respectively, representing a sales-production ratio of 121.1%, 81.6%, 108.9%, 114.2%
and 98.9%, respectively. The following table sets forth certain details of our key drilling process
equipment and solutions as of October 31, 2025:
Product Appearance Features Application Scenarios
Average Lead
Time from
Purchase Order to
Delivery (Weeks)
Mechanical Drilling
System ........
 High-speed rotating
spindle with synchronized
motion control
 Automatic drill bit
replacement functionality
Multi-layer boards, HDI
boards and packaging
substrates
6−8
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Product Appearance Features Application Scenarios
Average Lead
Time from
Purchase Order to
Delivery (Weeks)
Coated Drill Bit ....
  Nano-coating technology
via PVD to reduce wear
 Optimized geometry for
enhanced durability
An essential tool for
mechanical drilling, used to
drill and formate efficiently
0.5−1.5
CO
2 Laser Drilling
System ........
 High-power CO 2 laser
ablation for microvia
formation
 Non-contact processing to
minimize thermal damage
HDI boards and packaging
substrates
10−15
UV Laser Drilling
System ........
 UV cold-source laser
processing for flexible
materials
 Flying drilling mode for
PI substrates
FPC, rigid-flex boards
(smartphones, wearables,
automotive BMS)
8−10
Next-Generation Laser
System ........
 Next-generation laser
technology for minimal
thermal impact
 Precision processing of
ABF/BT/RCC materials
Packaging substrates,
advanced packaging
(smartphones, foldable
devices, CPU/GPU)
16−20
TGV Laser Processing
Solution .......
 Laser modification of
glass substrates followed
by chemical etching
 Panel-level processing for
large-format substrates
Glass-core FC-BGA,
panel-level glass interposers
23−27
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Case Study – Company A
Background
The AI server industry is witnessing an increase in requirements for computing performance,
storage capacity, and data transmission speed to support AI workloads such as training and
inference. These requirements place increasingly stringent standards on PCBs used in AI servers,
which require a combination of HDI boards and ultra-high multilayer boards architectures to
achieve superior back drilling alignment deviation control and stub length control.
Solutions
To enable our customer to satisfy the above standards, we recommended Company A with our
F6XH series CCD drilling system, the functions of which are summarized as follows:
 Back Drilling Alignment Deviation Control : The F6XH series utilizes CCD technology
to scan each hole, identifying deviations between theoretical and actual positions. This
allows for precise compensation during the drilling process, ensuring concentricity
between back-drilled and through-holes. This feature effectively resolves issues related
to irregular expansion and contraction commonly found in high-density multilayer
boards, as well as the problem of residual copper caused by drill hole deviation.
 Back Drilling Stub Length Control : Equipped with 3D back drilling functionality, the
F6XH series records the height position of each copper layer during through-hole
drilling. This data is used to calculate precise back drilling depths, which are linked to
QR codes to ensure correspondence and quality traceability. This feature enables precise
control of the back drilling depth, solving signal transmission problems caused by
uneven pressing thickness resulting in insufficient or excessive back drilling depth.
Our F6XH series effectively addresses our customer’s pain points by enhancing precision and
control in the drilling process, ensuring that their PCBs meet the more stringent standards and
demands of AI server applications. This solution not only improves the reliability of the boards but
also optimizes production efficiency, aligning with the high-performance requirements of modern
AI technologies.
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Photolithography Equipment and Solutions
The photolithography process involves transferring the designed circuit patterns onto the PCB
substrate. Industry photolithography technologies are classified into two main methods: LDI,
which operates without a film, and traditional film-based photolithography, which relies on a
photomask. We primarily provide customers with LDI equipment covering inner layer patterns,
outer layer patterns, and solder mask patterns. LDI utilizes a fully digital production model,
eliminating multiple steps of the traditional process and avoiding quality issues associated with
film materials. To meet the high-tech demands for fine-line processing in PCB segments such as
packaging substrates and HDI boards, we have introduced high-resolution LDI equipment. This
initiative continues to accelerate the localisation of equipment and the replacement of traditional
photolithography methods.
Our LDI technology eliminates photomasks and streamlines production for high-density
designs. We achieve 480 panels/hour throughput and ±10µm alignment accuracy in our INLINE
LDI system, surpassing typical industry performance for substrates used in AI hardware. In 2022,
2023, 2024 and the ten months ended October 31, 2024 and 2025, we sold 132, 79, 141, 119 and
103 units of photolithography equipment, representing a sales-production ratio of 109.1%, 97.5%,
110.2%, 114.4% and 93.6%, respectively. The following table sets forth certain details of our
major equipment and solutions for photolithography process as of October 31, 2025:
Product Appearance Features Application Scenarios
Average Lead
Time from
Purchase Order to
Delivery (Weeks)
Inner Layer LDI
System .......
 Suitable for inner layer
photolithography of Multi-layer
boards and HDI boards
Multi-layer boards and
HDI boards
8−10
 Digital micromirror (DMD)
projection
Outer Layer LDI
System .......
 Suitable for outer layer
photolithography of Multi-layer
boards, HDI boards and
packaging substrates
Multi-layer boards, HDI
boards and packaging
substrates
8−10
 Digital micromirror (DMD)
projection
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Product Appearance Features Application Scenarios
Average Lead
Time from
Purchase Order to
Delivery (Weeks)
Solder Mask LDI
System .......
 Suitable for photolithography of
solder mask
 Single/composite wavelength
curing
Multi-layer boards and
HDI boards
10−12
Case Study – Company B
Background
The AI server industry places extremely high requirements on PCB impedance control
precision to ensure high-speed digital signal transmission and power integrity. The line tolerance
during the photolithography process is a key factor influencing PCB board impedance. Traditional
LDI photolithography machines are unable to meet the stringent line width tolerance demands of
these advanced products.
Solutions
We implemented a comprehensive optimization of our LDI photolithography machines, such
as the Inline LDI-E15L series, focusing on both hardware and software enhancements.
In terms of the hardware, we introduced higher precision lasers to improve the accuracy of
the photolithography process. We enhanced dynamic focus control capabilities, allowing for more
precise adjustments during operation. In addition, we optimized the optical path design to
significantly improve circuit imaging resolution, ensuring sharper and more accurate line
definitions. We also refined the motion platform control to enhance stability and impedance control
precision during the photolithography process. In terms of the software, we developed an
intelligent algorithm to compensate for line width variations, ensuring consistent line width across
the PCB. This involved optimizing the line width design to meet the specific impedance control
requirements of AI server PCBs.
Through these targeted improvements, we successfully enhanced the line tolerance capability
of our LDI photolithography machines. This ensured that the equipment could meet our customer’s
high-tolerance requirements, effectively resolving their pain points related to achieving precise
impedance control in their AI server products.
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Testing Equipment and Solutions
The testing process is crucial in PCB production, as it ensures both the functional reliability
and structural integrity of end products. The electrical performance testing of semi-finished and
finished products screens their functionality, reliability, and appearance to reduce defects. We
provide universal testing equipment, dedicated testing equipment, dedicated high-precision testing
equipment, automated optical inspection equipment and automated visual inspection equipment.
Our equipment and solutions cover a diverse range of electrical testing equipment to assess
whether the PCBs’ electrical performance meets design requirements, along with automated optical
inspection system to evaluate product integrity and identify defects like open circuits, shorts,
foreign objects, and scratches. As circuit densities escalate in advanced applications, such as AI
servers and 5G modules, the complexity of quality validation increases exponentially. To address
these challenges, we deploy automated testing architectures, which integrate industrial vision
alignment systems that perform micron-level PCB calibration through real-time CCD imaging,
algorithmic offset analysis, and closed-loop compensation, resolving probe misalignment to boost
first-pass yields.
Our testing process equipment and solutions support testing of 650mm × 965mm finished
boards and up to 768,000 test points in our signature testing process equipment, critical for AI
server validation. In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, we
sold 519, 400, 446, 359 and 501 units of testing equipment, representing a sales-production ratio
of 101.8%, 93.2%, 80.9%, 88.2% and 93.1%, respectively. The following table sets forth certain
details of our major testing process equipment and solution as of October 31, 2025:
Product Appearance Features Application Scenarios
Average Lead
Time from
Purchase Order to
Delivery (Weeks)
Universal Testing
Equipment ......
 Multiple test grids with
fine-tuning fixtures.
 Minimum probe wire
diameter of 50µm.
 Expands application
range of testing
equipment.
Multi-layer board testing in
laptops, automotive
electronics, and
communication equipment
3−4
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Product Appearance Features Application Scenarios
Average Lead
Time from
Purchase Order to
Delivery (Weeks)
Dedicated Testing
Equipment ......
 Cable-free architecture
with one-click fixture
replacement.
 CCD automatic
fine-tuning system.
 Enhances testing
efficiency and precision.
High-reliability multi-layer
board testing in AI servers,
AI accelerator cards,
automotive electronics, and
industrial control
2−3
Dedicated
High-Precision
Testing Equipment ..
 Dual-tray or four-tray
design for high-density
PCB testing.
 High-precision pin
fixtures with 25µm
diameter.
 Optional features to
improve test yield.
Advanced smartphone
motherboards, optical
modules, and packaging
substrates
6−8
Automated Optical
Inspection
Equipment ......
 High-definition cameras
with AI for image
processing.
 Identifying defects like
open circuits and shorts.
 Ensuring integrity of
PCB circuit patterns.
Multi-layer boards and HDI
boards
6−8
Automated Visual
Inspection
Equipment ......
 Line-scan CCD with AI
to reduce false positives.
 Offers different
resolutions for various
products.
 Tailored for different
PCB product needs.
Finished PCB visual
inspection, identifying
defects like foreign objects
and scratches
4−6
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Formation Equipment and Solutions
The formation process involves using milling or laser techniques to remove excess edges or
create internal cut-outs in PCBs, shaping them to the required specifications and dimensions.
Typically, rigid boards are processed using mechanical milling, while laser technology is employed
for ultra-thin rigid boards, FPC, and rigid-flex boards with high precision requirements. We
provide mechanical forming equipment and laser forming equipment for customers’ formation
processes.
We provide precision solutions for PCB shaping across rigid and flexible architectures. Our
mechanical formation equipment achieve ±50µm accuracy with marble-body stabilization,
validated for long-term reliability in data center applications. Moreover, we enable ±20µm
precision on ultra-thin materials through our laser processing systems, meeting advanced
requirements for foldable devices and miniaturized electronics. In 2022, 2023, 2024 and the ten
months ended October 31, 2024 and 2025, we sold 463, 289, 596, 477 and 521 units of formation
equipment, representing a sales-production ratio of 112.1%, 87.8%, 106.4%, 110.2% and 108.3%,
respectively. The following table sets forth certain details of our equipment for formation process
as of October 31, 2025:
Product Appearance Features Application Scenarios
Average Lead
Time from
Purchase Order to
Delivery (Weeks)
Mechanical Routers ..
  Precisely controls the
milling cutter for
accurate PCB processing.
 Efficiently divides large
PCBs into smaller units.
Multi-layer boards, HDI
boards and packaging
substrates
6−8
Laser Routing System .
 Utilizes lasers to ablate
and vaporise the material
for precise division of the
entire FPC into smaller
units.
FPC and rigid-flex board
markets, optical modules
and packaging substrates
8−10
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Attachment Equipment and Solutions
The attachment process is tailored to the characteristics of FPC and rigid-flex boards,
utilizing a micro-adhesive tape roll feeding structure and heating platform to bond various
materials such as steel sheets and cover films. This process achieves functions like product rigidity
reinforcement and solder mask cover film attachment, replacing traditional semi-automatic or
manual operations with fully automated operations, significantly enhancing production efficiency
and processing precision.
We offer comprehensive attachment solutions for FPC and rigid-flex boards, cover films,
electromagnetic shielding films, adhesive tapes, among others. The steel sheet attachment
efficiency can reach up to 10,000 pcs/hour, with attachment precision better than ±50µm. In
addition, our attachment equipment enables simultaneous attachment and inspection to ensure
quality stability, meeting the demands of diverse applications such as smartphones, tablets, and
intelligent electric vehicles. In 2022, 2023, 2024 and the ten months ended October 31, 2024 and
2025, we sold 74, 183, 206, 168 and 208 units of attachment equipment, representing a
sales-production ratio of 84.1%, 101.7%, 101.0%, 94.9% and 80.3%, respectively. The following
table sets forth certain details of our equipment for attachment process as of October 31, 2025:
Product Appearance Features Application Scenarios
Average Lead
Time from
Purchase Order to
Delivery (Weeks)
Automatic Attachment
Equipment ......
 Automates high-precision
attachment of materials,
replacing manual
operations
 Boosts production
efficiency and processing
precision
FPC, rigid-flex boards,
protective covering film,
and electromagnetic
shielding film
5−9
Lamination Equipment and Solutions
The lamination process involves bonding multiple double-sided or HDI core panels using PP
and copper foil to form multi-layer PCBs. Traditional multi-layer boards with four or more layers
are laminated in a single process, while HDI products require multiple laminations depending on
the number of stacked blind vias. The technical challenge in this process is controlling the
uniformity and flatness of materials such as PP, fibreglass, and copper foil. Achieving superior
lamination quality is essential, as it ensures reliable quality in subsequent drilling processes.
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Our lamination process equipment and solutions enable robust multi-layer bonding for
high-reliability applications. In 2024, we launched and sold two units of lamination equipment,
representing a sales-production ratio of 50%. This sales-production ratio was primarily due to the
ramp-up period of new product introduction, during which initial sales volumes are typically lower
as the product gradually gains market acceptance. The following table sets forth certain details of
our lamination process equipment and solutions as of October 31, 2025:
Product Appearance Features Application Scenarios
Average Lead
Time from
Purchase Order to
Delivery (weeks)
Lamination System ...
  Utilizes high temperature
and high pressure to
laminate inner layers or
core boards with PP or PI
and copper foil.
 Capable of forming
multi-layer board
structures.
 Designed for versatility
in handling various board
types.
Standard multilayer boards,
HDI boards, packaging
substrates, multi-layer FPC,
and rigid-flex boards
16−22
RESEARCH AND DEVELOPMENT
We are dedicated to technological innovation, which is crucial in advancing our capabilities
and delivering value to our customers, while also driving our sales and profitability. With over 20
years of operational experience, we have amassed significant production expertise in high-speed
and high-precision motion control, precision machinery, electrical engineering, software
algorithms, advanced optical systems, laser technology, image processing and electronic testing.
We have made, and will continue to make, substantial investments in R&D activities. In 2022,
2023, 2024 and the ten months ended October 31, 2024 and 2025, our research and development
expenses amounted to RMB229.7 million, RMB193.6 million, RMB266.8 million, RMB200.7
million and RMB300.0 million, respectively.
Our R&D team comprises experts in high-speed motion control, laser technology applications
and software algorithms. As of October 31, 2025, we had a total of 871 R&D employees,
accounting for 27.3% of our total workforce. Among these 871 R&D employees, 74.5% hold a
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bachelor’s degree or above. Driven by the foundational needs of specific scenarios, we delve into
industry pain points, driving continuous improvement through process innovation, equipment
upgrades, process optimization and whole-plant integration. We adhere to the PDCA cycle
methodology to enhance personnel, machines, materials, methods, environment, and measurement
in a continuous spiral.
We have established the Han’s CNC Microelectronics research center specializing in laser
processing equipment for package substrates with patented processes for high-quality scum-free
results. We have also invested in multiple product centers responsible for product development. In
response to the trend of further specialization in the specialized PCB equipment industry, we
established the Lamination Product Center, the Coating Tool Product Center and the Optical
Inspection Product Center in 2023 to supplement and strengthen our product R&D in the relevant
fields. We focus on the forward-looking needs of market segments and application scenarios for
PCB technology, developing core platform technologies for dedicated production equipment. By
continuously expanding our global supply system and developing modular common
hardware/software platforms and assembly technologies, we reduce product development cycles
and ensure that our scenario-specific solutions remain industry-leading. As of October 31, 2025,
we had established the following product centers on product development:
 Mechanical Product Center, specializing in developing mechanical drilling and forming
machines, and automation products.
 Laser Product Center, specializing in CO
2 and UV laser drilling machines for HDI,
package substrates, and flexible boards.
 New Laser Product Center, specializing in developing innovative laser products like
laser forming and etching.
 Digital Imaging Product Center, pioneering in laser direct imaging systems using DMD
technology, replacing traditional film photolithography.
 Testing Product Center, specializing in a comprehensive range of quality inspection
products, including electrical testing equipment, AOI and A VI equipment.
 Lamination Product Center, specializing in multilayer PCB vacuum lamination
equipment, achieving full-process automation.
 Adhesion and Automation Product Center, specializing in automatic attachment
equipment for reinforcement sheets and films, supporting both offline and online modes.
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R&D Model
We have developed an independent R&D model which contains three key aspects:
 Understanding Customer Needs. We maintain close cooperation and communication
with downstream customers and their downstream customers, such as global electronics
brands. Through regular technical exchanges with customers and other downstream
partners, we ensure that our innovations are closely aligned with market needs.
 Mastering the Latest Technologies. We have established a dedicated R&D innovation
platform for specialized equipment, which serves as a hub for collaboration with
universities, research institutions and upstream supply chain partners. We have forged
strategic partnerships with prominent domestic enterprises, engaging in comprehensive
collaboration on process innovation and technology upgrades.
 Formulating Equipment Development Plans. Based on our expectation on future
market demands and industry evolution, we form strategic alliances with leading
upstream and downstream manufacturers to develop medium and long-term product
plans. By investing in advanced equipment which are compatible with next-generation
devices, we transition from merely meeting our customers’ current production and
processing requirements to driving transformative innovations in their production
processes to meet their future evolving needs.
R&D Process
Our R&D process is strategically aligned with our business development objectives and
industry trends, carefully identifying potential projects that cater to the evolving needs of our
customers. Our R&D projects are typically conducted through the eight key stages are as follows:
 Demand Analysis — We systematically translate customer needs into actionable product
development plans through cross-departmental collaboration, ensuring precise alignment
with market demands.
 Feasibility Analysis — We assess technical feasibility and commercial value through
technology validation and resource compatibility evaluation, including R&D timelines,
costs, and supply chain considerations.
 Pre-Project Review — Our management team evaluates technical feasibility and market
potential to determine if a project has the necessary development conditions and
commercial viability, resulting in a decision on whether to proceed.
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 Solution Design — We define the core framework and resource allocation strategy
through functional module breakdown and technical path planning, using user scenario
simulations and multi-solution comparisons to establish an executable development
baseline.
 Mid-Project Review — We conduct stage-specific quality checks and risk management
to ensure the development process adheres to technical standards and procedural norms,
facilitating progression to the next phase.
 Prototype Development — We develop physical prototypes based on design schematics,
conducting functional tests to identify potential issues, which inform subsequent
optimizations or mass production inputs.
 Post-Project Review — At the project conclusion, we perform a comprehensive review,
using relevant tests and data to evaluate overall outcomes, providing a conclusion on
whether to proceed to production, terminate, or optimize.
 Mass Production — We ensure a smooth transition from R&D to production through
trial production validation and supply chain coordination, ultimately approving the
product for large-scale production and market delivery.
Our Key Technologies and R&D Achievements
Through years of dedicated R&D activities focusing on optimal quality and cost-effectiveness
for PCB product functionality, we have consistently broken through critical technological barriers.
In response to the burgeoning AI server market, which has driven demand for high-multilayer HDI
boards, we have enhanced our technological capabilities to align with the technical requirements of
our downstream customers, thereby boosting our market position. In sectors demanding higher
technical specifications, such as SLP, packaging substrates and advanced packaging, we have
developed innovative laser processing solutions. These solutions have gained recognition and
secured orders from leading industry clients.
Through independent R&D, we have established core technologies for nearly all major PCB
production processes, including drilling, photolithography, lamination, formation and testing. Our
key technological achievements include (i) high acceleration and deceleration linear motor drive
motion control technology; (ii) precise mechanical design and advanced assembly technology; (iii)
specialized software platform and core algorithm technology; and (iv) micro blind hole drilling
technology. These technological achievements enable us to introduce a steady stream of original
and innovative products which challenge existing foreign monopolies and enable us to compete
effectively in the market.
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High Acceleration and Deceleration Linear Motor Drive Motion Control Technology
Through years of R&D, we have leveraged the absence of intermediate mechanical
transmission in linear motor drive technology to significantly reduce system response time. By
integrating our self-produced lightweight motion bodies, we were an early adopter of linear motor
drive technology in the domestic industry and design custom linear motors with high peak thrust,
high responsiveness, low electrical time constant, and low thermal consumption for our specialized
equipment’s transmission systems.
This technology greatly enhanced the acceleration, deceleration and response speed of the
drilling machines. The X-axis and Y-axis motion acceleration of PCB mechanical drilling
equipment can reach 1.5 times of the gravitational acceleration, and the Z-axis acceleration can
reach five times of the gravitational acceleration. Compared to equipment using ball screw
transmission technology, drilling efficiency is improved by approximately 15%, and drilling
precision is noticeably enhanced. This technology is widely applied in our mechanical drilling
machines, mechanical routing machines and CO
2 laser drilling machines.
Precise Mechanical Design and Advanced Assembly Technology
In terms of mechanical design, our R&D personnel have years of experience in precise
mechanical design for PCB-specific equipment. By analyzing the deformation of each component
under stress, we identify weak points in the mechanical structure and optimize them through
material selection and structural design, selecting precise components which lay the foundation for
the precision of the entire machine.
In terms of assembly technology, we use specialized tooling and fixtures to develop unique
assembly processes, continuously enhancing the processing precision of our products.
Specialized Software Platform and Core Algorithm Technology
We have established a specialized software development system tool, adopting a platform
design with multiple ports. We have also developed AI agents for project management in R&D,
and continuously expanded unique algorithms such as path optimization, laser energy control, and
dynamic following.
Furthermore, we have developed a unique parsing method for interpreting specialized
processing program files, quickly and accurately converting them into machine-executable files.
Using a “funnel” model, thousands of pieces of information are sorted, classified, and prioritized,
fostering efficient and high-quality software development.
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Micro Blind Hole Drilling Technology
Our micro blind hole drilling technology uses self-developed software, with the main
controller simultaneously driving the X-Y platform and the Z-axis and the grating ruler keeping
track of the real-time position. It connects two pulse modules via an EtherCAT bus, with data
transmission using only the network without occupying CPU resources. It enables a high
transmission rate, and all axes can be controlled at the same transmission rate.
In terms of optical systems, we employ special optical path static design and dynamic control
technology to control the drilling process, ensuring the quality and precision of the apertures. By
optimizing the motion control parameters, acceleration and deceleration can be improved
significantly while maintaining maximum machine speed. This technology supports multi-pulse
laser processing, achieving high positioning accuracy. Depending on the process requirements,
different laser sources can be used to create micro blind hole apertures ranging from 25µm to
200µm. With excimer laser processing, we can achieve micro blind hole apertures as small as 5
µm, with improved positioning accuracy.
OUR PRODUCTION
We primarily adopt a market-driven production model. Our integrated supply chain and
delivery platform formulates a MPS on a monthly basis, synthesizing demand forecasting, purchase
intentions, confirmed orders, inventory positioning, and capacity utilization. Through
multi-dimensional coordination across application scenarios, technologies, supply chains, materials
and production processes, we implement unified data collection/analysis systems enabling
inter-process regulation and error correction to maximize production synergy. This operational
blueprint governs material procurement through Bill of Materials (BOM) analysis, followed by
standardized modular assembly processes conducted in strict compliance with quality control
protocols. Final integration and comprehensive performance validation are executed prior to
delivery, ensuring alignment with market demand while optimizing resource allocation efficiency.
We have established a comprehensive production management platform that enables us to
monitor the production process via intelligent systems. This platform facilitates automated
production, visualized production data, and networked workshop management. We upgrade our
machinery from time to time to improve our production efficiency. We perform routine and
preventive maintenance on our machinery and equipment to ensure that they function properly at
all times. We constantly introduce advanced equipment and optimize our production technologies
to improve product quality and enhance production efficiency.
Our production process is designed to achieve consistent high-quality standards while
providing the flexibility for expediting production timeline to meet customer needs. Our process
technologies empower us to maintain industry-leading standards while rapidly responding to
dynamic market demands. See “— Research and Development — Our Key Technologies and R&D
Achievements.” Our advanced production capabilities and strict quality control measures enable us
to ensure the superior performance and outstanding reliability of our equipment and solutions.
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Production Process
The following table sets forth the typical production process of our specialized PCB
production equipment and solutions:
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Step Production Process Description
1. Integrated System
Design .............
We design our specialized equipment and solutions based
on our customers’ needs or industry standards, defining
system functions and performance. We optimize key
indicators such as structural strength and transmission
performance, ensuring seamless transition to production.
2. Component Sourcing and
Customization .......
We globally source standard components and use 3D
printing for custom parts, ensuring quality and flexibility
through efficient supply chain management.
3. Production Planning and
Initiation ...........
We allocate tasks based on market forecasts and the MPS,
optimizing production lines with MES and ensuring
smooth start-up through equipment calibration.
4. Modular Subassembly ... Mechanical Fabrication: Assemble mechanical structures
with components like enclosures and connectors,
calibrate key parameters, and perform functional tests for
stability.
Electronics Integration: Organize core electronic
components into modules, testing signal functions to
ensure smooth communication and stable operation.
Pneumatic and Electrical System: Integrate and connect
pneumatic and electrical components, conducting safety
tests on the systems.
Opto-Laser Assembly: Align and secure optical
components, install supporting systems and conduct
performance tests to meet design specifications.
5. Final Integration &
Commissioning .......
Structural Assembly: Precisely connect pre-assembled
mechanical, electronic, pneumatic, and electrical systems,
using laser interferometers to calibrate key components
and ensure alignment.
Electro-Optical Synchronization: Adjust signals and optical
paths to ensure precision in lasers, lenses and sensors.
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Step Production Process Description
Firmware Deployment: Fine-tune software parameters and
conduct comprehensive functional verification
post-deployment to ensure expected operation.
6. Finished Product Testing . We conduct comprehensive quality inspections using
advanced testing equipment and AI-assisted systems to
quickly identify and eliminate defects, ensuring each
product meets design standards.
7. Packaging and Storage ... We use tailored packaging to prevent damage during
transport and storage, and manage inventory efficiently
to ensure timely delivery to customers.
We maintain limited reliance on specialized heavy equipment, with primary production
processes centered around precision assembly, calibration, and integration of mechanical,
electrical, and optical components. This is primarily because our finished products are of moderate
size and weight and are designed with a high degree of modularity. Our production processes focus
on precision assembly and integration of mechanical, electrical, and optical components, rather
than heavy-duty fabrication or large-scale processing. According to CIC, the manufacturing of
specialized PCB production equipment in China generally does not require significant investment
in heavy equipment, as industry practice is to use standardized workstations, precision tools, and
modular assembly lines. During the Track Record Period, our procurement of heavy equipment
was mainly limited to transport trucks and forklifts for internal logistics. This operational structure
enables agile production facilities reconfiguration without incurring substantial retooling expenses
or facility modification costs.
We attach great importance to quality control of production processes and have established
the Production Operation Control Procedure ͛ପ༶БછՓ೻ҏ, the Administrative Regulations
on Production and Material Planning, the Product Measurement and
Monitoring Procedure಻ඎၾ္છ೻ҏ and other systems to inspect and control product
quality in various aspects such as incoming raw materials, semi-finished products, assembly
process, warehouse entry and delivery of finished products. See “— Quality Control.”
As part of our digitalization efforts, we implement various production-related systems, which
mainly include the ERP, SRM and CRM system.
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 ERP System , built on SAP S4 HANA, is primarily used by our operations and finance
departments. It ensures seamless integration of procurement, production, and financial
activities, providing real-time data analysis that supports strategic decision-making and
optimizes resource allocation.
 SRM System , mainly utilized by our procurement team to enhance supplier collaboration
and streamline procurement processes. It ensures efficient contract management and
performance monitoring, integrating risk management to improve supplier relationships
and operational efficiency.
 CRM System , primarily used by the sales and customer service departments. It manages
and analyses customer interactions throughout the customer lifecycle, automating
marketing processes and providing valuable insights into customer preferences to
enhance communication and satisfaction.
During the Track Record Period and up to the Latest Practicable Date, we did not encounter
any major interruptions in the production due to facility, equipment or system failures, nor did we
incur any major accidents.
Our Production Bases
As of the Latest Practicable Date, we had two production bases in China.
Shenzhen Production Base
Our Shenzhen production base spanned a GFA of approximately 118,266.0 sq.m. and
encompassed two production plants, namely, the Shajing Antuo Hill Production Plant ( Ӎʜτϖʆ
͛ପʈᅀ ) and the Fuyong Han’s Laser Manufacturing Center Production Plant ( ၅͑ɽૄዧΈ౽
ிʕː͛ପʈᅀ ) as of October 31, 2025. The Shajing Antuo Hill Production Plant commenced
operations in 2016 and specializes in the production of mechanical drilling equipment and digital
imaging equipment. The Fuyong Han’s Laser Manufacturing Center Production Plant commenced
operations in 2021 and is capable of producing mechanical drilling equipment, mechanical forming
machines, laser drilling equipment, digital imaging equipment and testing equipment.
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As of the Latest Practicable Date, we were constructing an industrial park in Shenzhen,
which, upon completion, will become one of the principal production sites of our Shenzhen
production base. The industrial park is expected to be completed and commence operation by the
end of 2026. We plan to relocate primarily the operational departments there, with minimal impact
on our existing production capacity, and the relocation will be completed before the industrial park
becomes operational in 2026. The new industrial park is located in close proximity to our current
production base, being separated by only a road, which will facilitate a smooth and efficient
transition without making us bare any material additional cost. The relocation will mainly involve
operational and functional departments, together with certain production lines, while the core
manufacturing lines will remain in operation at the existing site. As the relocation primarily
concerns the transfer of production personnel and workspace, rather than the complex movement
of large-scale equipment, the process offers greater flexibility and efficiency, thereby minimizing
disruption to our ongoing production activities. We have also developed comprehensive
contingency plans and allocated sufficient resources to ensure a seamless transition. Based on the
above, our Directors believe that the relocation will not have any material impact on our existing
production capacity.
As of the Latest Practicable Date, we had completed the acquisition of land; for certain
buildings, we had obtained the property ownership certificate, and for the remaining buildings, the
construction of main structures, and works on outdoor greening and fire protection, while interior
renovation and equipment installation were still in progress. We were also in the process of
obtaining the necessary permits and licences for operation. We have funded and plan to further
fund the investment for the construction of this industrial park with a mix of proceeds from our
A-share offering and our own funds. See “Financial Information — Discussion of Certain
Components of Consolidated Statements of Financial Position — Non-current Assets and
Non-current Liabilities — Property, Plant and Equipment.”
Xinfeng Production Base
Our Xinfeng production base, located in Jiangxi Province, China, spanned a GFA of
approximately 38,830.0 sq.m. and encompassed two production plants, namely, Xinfeng CNC
Production Plant (Ҧ (ᔮ)ʮ̡͛ପʈᅀ ) and Mason Electronics (Xinfeng)
Production Plant ( ௥Ⴥཥɿ(ᔮ)ʮ̡͛ପʈᅀ ), equipped with advanced production
facilities as of October 31, 2025. This production base started production in December 2022 and is
capable of producing PCB mechanical drilling equipment, PCB mechanical forming equipment,
digital imaging equipment and testing equipment.
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The following table sets forth the details of our two production bases for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Designed
Production
Capacity (1)
Actual
Production
Volume
Utilization
rate(2)
Designed
Production
Capacity (1)
Actual
Production
Volume
Utilization
rate(2)
Designed
Production
Capacity (1)
Actual
Production
Volume
Utilization
rate(2)
Designed
Production
Capacity (1)
Actual
Production
Volume
Utilization
rate(2)
Designed
Production
Capacity (1)
Actual
Production
Volume
Utilization
rate(2)
Unit Unit % Unit Unit % Unit Unit % Unit Unit % Unit Unit %
Shenzhen production base (3) ..... 3,541 3,208 90.6 2,455 1,979 80.6 2,867 2,600 90.7 2,649 2,420 91.4 4,925 4,710 95.6
Xinfeng production base (4) ...... — — — 476 424 89.1 1,768 1,710 96.7 1,022 953 93.2 1,267 1,227 96.8
(1) Designed production capacity is the output of specialized PCB production equipment a production base can achieve, calculated based on the assump tion that the
production facilities operate for 360 days each year and 300 days for the ten months ended October 31, 2025, and 10 hours per day, with each worker also wo rking
10 hours per day, taking into considerations interruptions due to maintenance, breakdowns or other delays.
The fluctuation in the designed production capacity of our Shenzhen production base during the Track Record Period was primarily attributable to cha nges in market
conditions and corresponding adjustments in production planning. Designed production capacity is determined based on factors such as the number of production
staff, planned operating days and hours, and allowances for maintenance and other interruptions. In 2023, as the specialized PCB production equipme nt industry in
China experienced a downturn and market demand declined, we proactively reduced production staff and adjusted production arrangements, resulting in a decrease in
designed production capacity from 3,541 units in 2022 to 2,455 units in 2023. As market conditions improved and customer orders increased in late 2023 ,w e
increased production staff, leading to a rise in designed production capacity to 2,867 units in 2024. For the ten months ended October 31, 2025, the des igned
production capacity of our Shenzhen production base increased to 4,925 units, compared to 2,649 units for the same period of 2024, reflecting our resp onse to
anticipated demand and further ramp-up of production resources. This flexible approach enabled us to optimize resource allocation and control oper ating costs in
response to prevailing market conditions.
(2) Utilization rate is calculated by dividing actual production volume by the designed production capacity for the same year.
(3) Our Shenzhen production base’s utilization rate for 2023 was relatively lower compared to other years during the Track Record Period, primarily b ecause in late
2023, the specialized PCB equipment industry began to rebound, which led to a significant influx of customer orders and an increase in our designed pro duction
capacity in the last quarter of 2023, with related actual production volume, sales and delivery occurring in early 2024.
(4) Our Xinfeng production base’s designed production capacity and utilization rate saw an increase between 2023 and 2024, following its commenceme nt in 2023 and a
subsequent ramp-up phase throughout 2024.
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The following table sets out the production and sales details of our products by PCB production process for the years/periods
indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Production
volume
Sales
volume
Sales-production
ratio (1)
Production
volume
Sales
volume
Sales-production
ratio (1)
Production
volume
Sales
volume
Sales-production
ratio (1)
Production
volume
Sales
volume
Sales-production
ratio (1)
Production
volume
Sales
volume
Sales-production
ratio (1)
Unit Unit % Unit Unit % Unit Unit % Unit Unit % Unit Unit %
Drilling Equipment .......... 2,076 2,514 121.1 1,384 1,129 81.6 2,865 3,119 108.9 2,250 2,569 114.2 4,549 4,499 98.9
Photolithography Equipment ..... 121 132 109.1 81 79 97.5 128 141 110.2 104 119 114.4 110 103 93.6
Testing Equipment .......... 510 519 101.8 429 400 93.2 551 446 80.9 407 359 88.2 538 501 93.1
Formation Equipment ........ 413 463 112.1 329 289 87.8 560 596 106.4 433 477 110.2 481 521 108.3
Attachment Equipment ........ 88 74 84.1 180 183 101.7 204 206 101.0 177 168 94.9 259 208 80.3
Lamination Equipment ........ —————— 4 2 50.0 3 1 33.3 7 0 0
Total/Overall ............ 3,208 3,702 115.4 2,403 2,080 86.6 4,312 4,510 104.5 3,374 3,693 109.5 5,944 5,832 98.1
Note:
(1) Sales-production ratio refers to the sales volume divided by production volume and multiplied by 100%.
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During the Track Record Period, the sales-production ratio for most of our products exceeded
100%, reflecting our core competitive strength in meeting evolving market demands. Our
sales-production ratio for 2023 was relatively lower compared to other years during the Track
Record Period, primarily because in late 2023, the specialized PCB equipment industry began to
rebound, which led to a significant influx of customer orders and an increase in our production
activities in the last quarter of 2023, with related sales and delivery occurring in early 2024.
CUSTOMERS, SALES AND MARKETING
Our Customers and Customer Service
Leveraging our competitive product portfolio and extensive sales expertise, we have
established a robust customer base encompassing many of the world’s leading enterprises and
thousands of small- to medium-sized PCB manufacturers. We adopt a customer-centric marketing
approach to build and expand our relationships with customers. We collect feedback directly from
them to garner insights that help drive our business and operations forward. We utilize offline and
online marketing channels such as our website, industry exhibitions, seminars and industry media
to showcase our latest products and technological achievements. These targeted marketing
strategies meet our business promotion needs, enhance our brand awareness and capture the
attention of potential customers.
During the Track Record Period, our customers were mainly PCB manufacturers in China,
while a small proportion of our customers were distributors. Revenue from sales to our top five
customers in each year or period during the Track Record Period in aggregate accounted for
36.4%, 25.0%, 22.6% and 32.5% of our total revenue, respectively, in the same periods. Revenue
from sales to our largest customer in each year or period during the Track Record Period
accounted for 12.6%, 7.5%, 5.7% and 19.7% of our total revenue, respectively, in the same
periods. Our Directors are of the view that there is no customer concentration risk.
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The following table sets forth details of our five largest customers in each year or period
during the Track Record Period:
Year ended December 31, 2022
Customers Products provided
Revenue
from the
customer
% of total
revenue
Background and principal business
activity
Length of business
relationship with
our Group Credit terms Settlement method
(RMB ’000) (%)
Customer A .... Drilling equipment, formation
equipment, photolithography
equipment and testing
equipment
352,016 12.6 A public company listed on the
Shenzhen Stock Exchange that
primarily engages in the R&D,
production, and marketing of
PCBs
Above 5 years 3 to 18 months Bank transfer
or bill
collection
Customer B .... Drilling equipment,
photolithography equipment and
testing equipment
300,770 10.8 A public company listed on the
Shenzhen Stock Exchange that
primarily engages in
comprehensive PCB production
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Customer C .... Drilling equipment, formation
equipment, photolithography
equipment and testing
equipment
183,700 6.6 Primarily engages in producing
small to medium batch PCBs
and high multilayer boards
Above 5 years 3 to 18 months Bank transfer
or bill
collection
Customer D .... Drilling equipment, formation
equipment, photolithography
equipment and testing
equipment
90,232 3.2 A public company listed on the
Shenzhen Stock Exchange that
primarily engages in
comprehensive PCB production
Above 5 years 3 to 15 months Bank transfer
or bill
collection
Customer E .... Drilling equipment,
photolithography equipment and
testing equipment
88,355 3.2 A public company listed on the
Shanghai Stock Exchange that
specializes in automotive and
consumer electronic PCBs
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Total ....... 1,015,073 36.4
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Year ended December 31, 2023
Customers Products provided
Revenue
from the
customer
% of total
revenue
Background and principal business
activity
Length of business
relationship with
our Group Credit terms Settlement method
(RMB ’000) (%)
Customer B .... Drilling equipment, attaching
equipment and testing
equipment
122,067 7.5 A public company listed on the
Shenzhen Stock Exchange that
primarily engages in
comprehensive PCB production
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Customer D .... Drilling equipment, formation
equipment, attaching equipment
and testing equipment
119,084 7.3 A public company listed on the
Shenzhen Stock Exchange that
primarily engages in
comprehensive PCB production
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Customer F .... Drilling equipment and formation
equipment
67,818 4.1 A public company listed on the
Shanghai Stock Exchange that
primarily engages in
high-density interconnect PCBs,
particularly any-layer HDI, for
use in smartphones, tablets, and
smart wearable devices
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Customer G .... Drilling equipment, formation
equipment, attaching equipment
and testing equipment
54,741 3.3 Specializes in high-density
interconnect PCBs, particularly
any-layer HDI, for use in
smartphones, tablets, and smart
wearable devices
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Customer H .... Drilling equipment, formation
equipment, attaching equipment
and testing equipment
45,198 2.8 Engages in PCB prototyping and
mass production; online sales of
electronic components
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Total ....... 408,908 25.0
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Year ended December 31, 2024
Customers Products provided
Revenue
from the
customer
% of total
revenue
Background and principal business
activity
Length of business
relationship with
our Group Credit terms Settlement method
(RMB ’000) (%)
Customer G .... Drilling equipment, formation
equipment and attaching
equipment
192,046 5.7 Specializes in high-density
interconnect PCBs, particularly
any-layer HDI, for use in
smartphones, tablets, and smart
wearable devices
Above 5 years 3 to 18 months Bank transfer
or bill
collection
Customer B .... Drilling equipment, attaching
equipment, photolithography
equipment and testing
equipment
161,444 4.8 A public company listed on the
Shenzhen Stock Exchange that
primarily engages in producing
small to medium batch PCBs
and high multilayer boards
Above 5 years 3 to 16 months Bank transfer
or bill
collection
Customer I ..... Drilling equipment, formation
equipment, photolithography
equipment and testing
equipment
154,505 4.6 A public company listed on the
Shenzhen Stock Exchange that
specializes in producing
high-precision double-sided and
multilayer PCBs, automotive
PCBs, and industrial control
PCBs
Above 5 years 3 to 18 months Bank transfer
or bill
collection
Customer J .... Drilling equipment, formation
equipment, photolithography
equipment and testing
equipment
137,124 4.1 A public company listed on the
Shenzhen Stock Exchange that
specializes in PCBs for servers
and data centres
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Customer K .... Drilling equipment, formation
equipment, attaching equipment
and testing equipment
110,290 3.3 A public company listed on the
Shanghai Stock Exchange that
specializes in a full range of
PCBs, including rigid, flexible,
metal substrate, and HDI boards
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Total ....... 755,409 22.6
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Ten months ended October 31, 2025
Customers Products provided
Revenue
from the
customer
% of total
revenue
Background and principal business
activity
Length of business
relationship with
our Group Credit terms Settlement method
(RMB ’000) (%)
Customer L .... Drilling equipment, testing
equipment, accessories and
maintenance
851,306 19.7 A public company listed on the
Shenzhen Stock Exchange that
specializes in the R&D,
production and sales of
high-precision multilayer, HDI
PCB, FPC and rigid-flex PCBs.
Above 5 years 3 to 20 months Bank transfer
or bill
collection
Customer M .... Drilling equipment,
photolithography equipment,
testing equipment, accessories
and maintenance
145,397 3.4 A public company listed on the
Shanghai Stock Exchange that
primarily engages in the
production of high-precision,
high-density and high-quality
printed circuit boards
Above 5 years 3 to 6 months Bank transfer
or bill
collection
Customer N .... Drilling equipment, formation
equipment, attachment
equipment, testing equipment,
accessories and maintenance
137,840 3.2 A public company listed on the
Shenzhen Stock Exchange that
primarily engages in
comprehensive PCB production
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Customer J .... Drilling equipment, formation
equipment, attachment
equipment, testing equipment,
accessories and maintenance
133,295 3.1 A public company listed on the
Shanghai Stock Exchange that
primarily engages in the
production of high-precision,
high-density and high-quality
printed circuit boards
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Customer F .... Drilling equipment, formation
equipment, testing equipment,
accessories and maintenance
132,555 3.1 A public company listed on the
Shanghai Stock Exchange that
primarily engages in
high-density interconnect PCBs,
particularly any-layer HDI, for
use in smartphones, tablets, and
smart wearable devices
Above 5 years 3 to 12 months Bank transfer
or bill
collection
Total ....... 1,400,393 32.5
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To the knowledge of our Directors, as of the Latest Practicable Date, none of our Directors
and their respective associates or any of our shareholders holding more than 5% of our issued
share capital had any interests in any of our five largest customers in each year or period during
the Track Record Period.
Our Sales Network
During the Track Record Period, we established an extensive sales network that allows us to
bring our products to a broad customer base, bolstering our brand reputation and reinforcing our
competitive edge in the market. During the Track Record Period, we entered into sales and
purchase agreements with our direct customers, and also sold our products through distributors,
who in turn sell our products to other companies. As of October 31, 2025, we had established four
overseas subsidiaries and maintained three distributors, through which our products have been sold
to more than 10 countries and regions.
The following table sets forth a breakdown of our revenue by geographic region, based on the
locations of our customers, for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
Mainland China .... 2,749,760 98.7 1,549,406 94.8 2,981,171 89.2 2,322,285 88.5 3,761,835 87.2
Overseas (1) ...... 36,390 1.3 84,905 5.2 361,920 10.8 301,597 11.5 552,311 12.8
Total ......... 2,786,150 100.0 1,634,311 100.0 3,343,091 100.0 2,623,882 100.0 4,314,146 100.0
Note:
(1) Primarily include Thailand, Taiwan China and Malaysia.
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The following table sets forth a breakdown of our revenue by contribution from our
customers for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except percentages)
Direct customers (1) .. 2,764,944 99.2 1,619,318 99.1 3,316,306 99.2 2,603,270 99.2 4,276,472 99.1
Distributorship ..... 21,206 0.8 14,993 0.9 26,785 0.8 20,612 0.8 37,674 0.9
Total ......... 2,786,150 100.0 1,634,311 100.0 3,343,091 100.0 2,623,882 100.0 4,314,146 100.0
Note:
(1) Direct customers refer to the end users of our products or services, engaging with us directly by themselves or
through sales agents.
Direct Customers
During the Track Record Period, our direct customers mainly included PCB manufacturers. In
2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, we generated
RMB2,764.9 million, RMB1,619.3 million, RMB3,316.3 million, RMB2,603.3 million and
RMB4,276.5 million from sales to direct customers, accounting for 99.2%, 99.1%, 99.2%, 99.2%
and 99.1% of our revenue in each respective period.
The salient terms of the sales and purchase agreements between us and our direct customers
are set out below:
 Product specifications . Our direct customers typically set forth product specifications
for products ordered, such as product name, model, configuration and features.
 Payment and credit term . We typically require prepayment, and we may grant credit
terms to the direct customers who have passed relevant credit assessments, requiring
them to pay us within three months to 18 months.
 Return arrangements. We typically do not allow customers to return or replace products
to us unless there are product quality issues.
 Warranty. We typically offer direct customers a 12-month product warranties.
 Confidentiality . All confidential information provided by either party shall not be
disclosed to any third party without prior consent.
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 Termination . The agreement can be terminated upon written notice of one party, in the
event of fraud, bankruptcy or material breach of the agreement of the other party.
During the Track Record Period, we have strategically engaged third-party sales agents to
leverage their expertise and market presence in local market. These agents, typically
well-established trading companies within their respective industries, have been instrumental in
enhancing the accessibility of our products. By capitalizing on their local strengths, we have
successfully expanded our sales network and experienced growth in overseas customers. We pay
these third-party sales agent service fees for their services in helping us expand our sales network.
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, we recorded third-party
sales agent service fees of RMB1.2 million, RMB1.1 million, RMB2.2 million, RMB2.2 million
and RMB3.0 million, respectively. We directly enter into sales contracts with the end customers
who were connected to us by the third-party sales agents.
The salient terms of the agreements between us and third-party sales agents are set out below:
 Duration . The duration of the agreements is typically two years.
 Commission . If the gross profit margin is not less than 30% (inclusive), we will pay the
sales agent a commission of 8.0% of the product price (exclusive of tax and after
deduction of equipment modification, expansion and warranty costs). If the gross profit
margin is less than 30% (exclusive), the commission rate will be determined through
mutual negotiation. According to CIC, our commission arrangement with third-party
sales agents is in line with the industry practice in China’s specialized PCB equipment
industry.
 Sales Agents’ Responsibilities . Sales agents are responsible for the marketing, and
promotion of our “HANS CNC” and/or “ ɽૄᅰછ” brand in the relevant region.
 Our Responsibilities . We are obligated to supply products that meet quality standards
consistently and are required to ensure the pricing is fair and reasonable, aiding sales
agents in maintaining an edge in the market.
 Intellectual Property . We have granted sales agents the non-exclusive right to use our
trademarks, wordmarks, and other brand-related designs free of charge while promoting
our products under the agreement.
 Termination . The agreements terminate upon expiry, or can be terminated by mutual
agreement. The agreement can also be terminated upon written notice of one party, in
the event of fraud, bankruptcy or material breach of the agreement of the other party.
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Distributorship
Levering our long operation history in the PCB production equipment industry and our
established brand image, we also cooperate with distributors, who are generally trading companies
in the PCB production equipment industry to increase the accessibility of our products, particularly
for overseas customers. During the Track Record Period, the majority of our distributors were
located in Taiwan China. We maintain a buyer-seller relationship with our distributors. During the
Track Record Period, the number of our distributors remained stable at three with no changes. In
2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, we generated RMB21.2
million, RMB15.0 million, RMB26.8 million, RMB20.6 million and RMB37.7 million,
respectively, from sales to distributors, accounting for 0.8%, 0.9%, 0.8%, 0.8% and 0.9%,
respectively, of our revenue.
During the Track Record Period, one of our distributors, Han’s Laser, was one of our
connected persons, which procured our products primarily due to the preferences of their
downstream customers. We expect to continue to have transactions with Han’s Laser, which was
the only connected person that was also our distributor as of the Latest Practicable Date. For
details of Han’s Laser, see “History and Corporate Structure.”
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, our revenue
generated from Han’s Laser who was one of our distributors was approximately RMB7.2 million,
RMB2.1 million, RMB0.7 million, RMB0.7 million and RMB3.6 million, respectively,
representing approximately 0.3%, 0.1%, 0.0%, 0.0% and 0.1% of our total revenue in the same
periods.
We entered into standard distribution agreements with Han’s Laser, and the terms in these
agreements are comparable to those offered to our other independent distributors. Our Directors
are of the view that the transactions that we entered into with Han’s Laser were on an
arm’s-length, mutually independent basis under normal commercial terms.
Management of Distributors
We value the management of our distributors, and maintain a good cooperative relationship
with them. Our distributors management covers the order and settlement management, marketing
support and training and evaluations. Our sales team evaluates distributors based on a number of
criteria, which mainly include their sales performance and cooperation in sales network
development.
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To minimise the risk of cannibalisation, we generally take the following measures in relation
to our distributors: (i) when selecting our distributors, we take into consideration their respective
geographic coverage to avoid potential competition among the distributors within a region; (ii) our
distribution agreements specify the designated distribution regions; and (iii) we regularly
communicate with our distributors to monitor various aspects of their sales activities and keep
track of any potential cannibalisation or competition among our distributors.
Other than Han’s Laser, to the best of our knowledge, during the Track Record Period, all our
distributors were Independent Third Parties, and our distributors, or their respective associates, do
not have any past or present family, business, or financial relationships with us or our subsidiaries,
our shareholders, directors or senior management, or any of their respective associates.
Our Arrangements with Distributors
Our relationship with distributors is a standard buyer-seller relationship. We consider the
distributors as our customers, who further sell products to end users of our specialized PCB
production equipment. We typically do not set minimum purchase requirements for our
distributors. We typically enter into sales and purchase agreements with our distributors. The
salient terms of our standard sales agreements between us and our distributors are set out below:
 Product specifications . Our distributors typically set forth product specifications for
products ordered, such as product name, model, configuration and features.
 Payment and credit term . We typically require full payment after equipment acceptance,
and we may grant credit terms to the distributors who have passed relevant credit
assessments, requiring them to pay us within three months of stable production
following installation.
 Return arrangements. We typically do not allow distributors to return or replace
products to us unless there are product quality issues.
 Confidentiality . All confidential information provided by either party shall not be
disclosed to any third party without prior consent.
 Termination . The agreement can be terminated upon written notice of one party, in the
event of fraud, bankruptcy or materially breach of the agreement of the other party.
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Pricing
The pricing of our products is primarily determined by market competition and the prevailing
market prices for our products, which are in turn affected by the overall market conditions as well
as the market prices of comparable products offered by our peers. We typically determine product
pricing upon entering into the mutually agreed contracts with our customers. A small number of
our customers use a bidding process for pricing determination. See “Risk Factors — Risks
Relating to Our Business and Industry — We may not be able to procure new customer orders
through tenders as planned or at a desirable pace or on favorable terms.”
Sales and Marketing
We have a strong and dedicated sales team, consisting of over 700 sales personnel as of
October 31, 2025. Our key sales personnel, with an average of over 10 years’ experience, maintain
close relationships and communication with our customers through regular visits. To further
enhance our sales and marketing capabilities, we conduct training on the latest market
developments and sales techniques. This initiative provides our sales team with a comprehensive
understanding of the market, improving market coverage and fostering a more cohesive workforce.
Furthermore, we have participated in the formulation and promotion of industry standards.
Our chairman leads the Special Equipment Branch of the CPCA and has spearheaded the drafting
of the CPCA industry standard T/CPCA8001-2022, which was successfully implemented. This
participation highlights our technical strength and influence within the industry, enhancing our
brand recognition and authority.
We emphasize on collaborative R&D with customers which possess top-tier technical
expertise and significant global influence. Our R&D team engages in regular discussion with these
customers on a quarterly basis to explore the anticipated changes in their future products and the
corresponding changes we need to make to our equipment. In this way, we ensure the compatibility
between our equipment and their standards, maintaining our future competitiveness. Thus, we
maintain a close relationship with our customers that goes far beyond a mere transactional
relationship.
After-Sales Services
We believe that the accessibility of high-quality after-sales services is an important
consideration behind a customer’s purchase decision. We provide extensive after-sales services to
our customers to cultivate customer loyalty and enhance our brand image. We offer full lifecycle
value-added services to customers to ensure that our products consistently meet their production
requirements. Our after-sales service team comprises three key departments: (i) our frontline
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service department, which is divided into regions, delivers direct service to customers. This
regional approach ensures that we can promptly attend to specific customer needs; (ii) our
technical support department offers assistance with complex technical challenges faced by the
frontline teams. It also plays a vital role in product R&D, contributing to our ongoing innovation
and development efforts; and (iii) our human resources department maintains a steady flow of
skilled service engineers to each regional frontline service area.
Our equipment typically comes with a twelve-month warranty, while certain components of
these equipment may have a six-month warranty. After this period, free consultation for
maintenance and repair is available, but we charge fees for services including on-site confirmation,
repair, and replacement parts. As part of our full lifecycle value-added services, we offer
preventive maintenance services at a charge, reinforcing the “maintain, not repair” philosophy and
helping customers improve operational efficiency and reduce costs.
We regularly conduct professional and technical training to improve the professional skills of
after-sales service personnel. To ensure the quality of our after-sales services, we conduct regular
appraisals with regards to their performance. We have also appointed designated chief service
officer for some of our customers to coordinate value-added services across all equipment
categories, offering bespoke solutions tailored to customer’s specific on-site processes and
production conditions. These solutions include automation recommendations, capacity and quality
enhancement, as well as precision improvements for old products.
When a complaint arises, our team typically visits the customer’s site to thoroughly
understand the context and determine the cause of the problem. We had over 400 service engineers
in our sales team across China as of October 31, 2025, with four to five service engineers per
location on average, mainly covering the Pearl River Delta and Yangtze River Delta where
majority of our customer are located. This enables us to achieve a quick average response time of
approximately 90 minutes. Additionally, we pass on customers’ emerging needs to our product
centers to offer innovative solutions for customers. We also conduct return visits to ensure
customer satisfaction.
In terms of return and exchange of products, we clearly outline all specifications of the
equipment before signing contracts with customers. Upon delivery, the equipment is inspected
against each specification. In case it is determined that some specifications are not satisfied, we
address the defects through repair, upgrade or restoration. If the equipment still fails to meet the
customer’s expectations after one or two months of repair, the equipment will be returned to us.
Such returns are exceedingly rare, occurring only two or three times a year. During the Track
Record Period and up to the Latest Practicable Date, we did not experience any material product
returns, product recalls, product liability claims, warranty expenses or customer complaints that
adversely affected our business.
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As we continue to expand domestically and globally, we will continue to optimize our sales
and marketing network to ensure that we have sufficient geographic coverage across both existing
and new markets. We will expand our service and after-sales team in order to provide
comprehensive and prompt after-sales service solutions to customers abroad.
QUALITY CONTROL
We have comprehensive policies and detailed procedures in place to ensure product quality.
We have deployed multiple quality management systems and received various certification
including ISO-9001 and ISO-14001. We have established a dedicated quality control department,
which is led by our management team, to closely monitor our production process. As of October
31, 2025, we had a quality control workforce of more than 100 personnel. We have strengthened
standardized production and quality management training, engaging all staff in quality assurance
initiatives to minimize the risk of quality control issues. We have developed a full lifecycle quality
control system covering product R&D, supply chain, production process and customer service,
ensuring that all products are produced and assembled adhering to consistent standards and quality.
Our quality control measures include the following:
 Product R&D Quality Control : We use an integrated product development model,
leverage the research outcomes driven by the technical needs of various niche scenarios,
and adopt advanced product quality plans to prevent design defects and quality issues
during the R&D phase. We have designated personnel responsible for supervising and
inspecting the integrity of the R&D process and the quality of deliverables at each
project stage.
 Supply Chain Quality Control : We carefully select qualified suppliers based on the
quality and technical standards of raw materials. We selectively procure raw materials
from qualified suppliers and conduct rigorous inspections to ensure that the quality of
raw materials is suitable for production.
 Production Process Quality Control : We strictly adhere to process standards in
production to minimize deviations from agreed product specifications, and we take
timely measures to address any related issues arise during production. We also supervise
and inspect each production process.
 Customer Service : We have established a global marketing and service network,
providing localized technical support and after-sales service throughout the product life
cycle. We have also established a customer complaint handling procedure to promptly
address customer complaints and actively solicit customer feedback.
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SUPPLY CHAIN MANAGEMENT
Raw Materials and Procurement
The key raw materials we procure include sheet metal and machined parts, mechanical
devices, purchased modules and optical devices.
We primarily procure raw materials in China. For the procurement of raw materials, we
utilize the Material Requirements Planning (“ MRP”) system to analyze the timing and scheduling
of raw material deliveries, taking into account factors such as the MPS, production scheduling,
inventory safety, supplier lead times and minimum order quantities. These procurement plans are
synchronized with the Supplier Relationship Management (“ SRM”) system through which these
plans can be communicated to our suppliers, which will then execute deliveries according to our
plans.
Potential pricing fluctuations in our raw materials can arise due to factors including global
and domestic economic conditions, governmental regulations, supply-demand dynamics and
geopolitical conditions. While our bargaining power for certain materials might be restricted to a
certain extent due to these factors beyond our control, our ability to procure sufficient supplies
remains steadfast. In procuring raw materials from suppliers, we generally adopt a one-time
pricing model, under which the price is fixed for each purchase agreement or purchase order,
thereby providing certainty for both parties. By locking in prices at the outset, we are able to
achieve greater certainty and stability in our production costs, which facilitates more accurate
budgeting and financial planning. According to CIC, the adoption of a one-time pricing model is a
common industry practice in China’s specialized PCB equipment industry.
The raw materials we procure are primarily precision-processed products, the prices of which
have historically exhibited low volatility. As a result, overall fluctuations in raw material prices
have not had a material impact on our results of operations. For certain materials, such as lasers,
we may adjust our quotations to reflect any corresponding cost increases. As a result, we are
generally able to pass on the increases in raw material costs to our customers.
During the Track Record Period, we did not experience any significant shortage of raw
materials supplies, and the raw materials provided by our suppliers did not have any significant
quality issues.
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Our Suppliers
Supplier Selection and Management
We have established stringent management mechanisms for the selection and retention of
suppliers. In accordance with the supplier management policy, we conduct due diligence and select
suppliers based on the availability, price and quality of the services or products, delivery time, as
well as the reputation, credential and experience of the suppliers. Supplier qualifications are
assessed through factory audits and sample testing. Companies in the qualified supplier list are
subject to regular evaluation and re-assessment, in order to ensure their compliance with our
policies and standards.
Our procurement methods include requests for quotation and agreements, and we select
suitable suppliers from the qualified supplier pool based on the nature of the raw materials. For
standardized components, procurement is primarily based on factors such as the quality, price, and
delivery time of the raw materials. For custom components, we design the parts independently and
select suppliers based on their technical expertise, processing capabilities and quotations.
During the Track Record Period, we did not enter into any long-term supply agreements with
our suppliers that included fixed-price arrangements. In response to the potential raw material
price increases, we primarily mitigate the impact by building long-term relationships with our
suppliers, maintaining close communication and conducting secondary source evaluations.
Meanwhile, we conduct R&D on new materials and engage new suppliers to maintain the
flexibility to switch to alternative materials or suppliers in the event of severe shortages or price
volatility of certain raw materials. We have implemented periodic reviews and internal mechanisms
to monitor the price of our raw materials by considering current stock levels, future sales and
market trends.
We require all of our suppliers to comply with our internal supply management policies. We
communicate with suppliers regarding quality standards, and thoroughly inspect the products
received to ensure that they meet all the technical requirements set forth in our product designs.
We may conduct regular or ad hoc on-site inspections of suppliers, and require suppliers to remedy
quality issues upon notice. Upon receiving materials and products from suppliers, we retain the
right to reject or return based on our inspection and examination results, and suppliers are
generally liable to us and our customers for any product quality issues of our products caused by
them. We also require our suppliers to sign an “Anti-Bribery Transaction Agreement,” by which
they undertake in writing to comply with the ethical requirements set out in the agreement.
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Our Directors confirm that our Group did not experience any material disruption, disputes or
delay in relation to supply by our suppliers during the Track Record Period and up to the Latest
Practicable Date.
Agreements with Suppliers
The salient terms of the supply agreements between us and our suppliers are set out below:
 Product Specification. We specify the product name, specification, price, quantity,
delivery timeline, delivery location and other details in each purchase order we send to
our suppliers.
 Price . The prices quoted to us shall be based on market conditions and stated in the
purchase orders prevail.
 Payment and Credit Term. Payment and credit terms are typically included in each order
that we place with the supplier. The typical credit terms offered by our suppliers range
from 30 days to 120 days. We primarily settle payments through bank transfer, bill
collection and letters of credit.
 Logistics. The suppliers are responsible for packaging and shall ensure that the
packaging is suitable for long-distance transportation. The suppliers normally assume
the logistic and transportation costs associated with the procurement of materials.
 Quality Guarantee. Products are typically accepted in accordance with our
specifications, as well as national, local and industry standards. We are entitled to return
any defective raw materials that do not meet the specifications and the suppliers shall
remedy the same, including product return and replacement.
 Confidentiality . We include confidentiality clauses in the agreements, and the period of
confidentiality obligation is extended beyond the expiration of the agreements.
Outsourced Manufacturing
Certain market players enjoyed cost advantages over certain components of specialized PCB
production equipment. In addition, we experienced production capacity shortage for certain types
of specialized PCB production equipment during the Track Record Period due to sudden spikes in
demand. As a result, we engaged other specialized PCB production equipment manufacturers to
produce certain components based on our product specifications and production standards. When
selecting manufacturing contractors for the production of specialized PCB production equipment,
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we take into account diverse factors, including, among others, technical capability, production
capacity, product quality, delivery efficiency and cost. See “— Supplier Selection and
Management.”
To ensure that our manufacturing contractors comply with applicable laws and regulations
and to protect our proprietary technologies and other intellectual property rights, we have
implemented the following measures:
(i) Entering into legally binding agreements with all manufacturing contractors, which
contain strict confidentiality and intellectual property protection clauses, as well as
explicit requirements regarding compliance with relevant laws and regulations;
(ii) Conducting regular assessments, on-site inspections and performance reviews to monitor
our manufacturing contractors’ compliance with our quality standards and their
contractual obligations; and
(iii) Providing technical guidance and training to ensure that our product specifications and
production standards are strictly followed.
The salient terms of the agreements between us and our manufacturing contractors for the
production of specialized PCB production equipment are set out below:
 Product Specifications . The agreements generally set out the scope of services to be
provided by our manufacturing contractors. We require our manufacturing contractors to
complete the works according to product specifications and production requirements.
 Raw Material Procurement . We are typically responsible for the procurement of all or a
majority of the raw materials required for production.
 Manufacturing Fees . The manufacturing fees are generally determined with reference to
market rates.
 Payment Term . Payment is typically required to be made within 30 days after receiving
the invoice from manufacturing contractors.
 Delivery . Manufacturing contractors are responsible for delivery to our appointed
location or warehouse.
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 Product Return/Exchange . Product inspection may take place within a specified period
after delivery. We may require the manufacturing contractor to replace the defective
products.
 Warranty . Manufacturing contractors typically offer 12-month product warranty for the
products they provide.
 Confidentiality . Typically, we require our manufacturing contractors to keep the terms of
agreements and any supplementary agreements confidential.
 Termination . The agreements terminate upon expiry, or can be terminated by mutual
agreement.
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, we engaged a
total of 142, 170, 169, 157 and 186 manufacturing contractors, with manufacturing fees of
RMB58.6 million, RMB39.7 million, RMB63.1 million, RMB51.4 million and RMB92.7 million,
respectively.
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, we engaged one,
four, three, 3 and 2 manufacturing contractors, who were our connected persons, with
manufacturing fees of RMB8.4 thousand, RMB570.5 thousand, RMB261.6 thousand, RMB185.1
thousand and RMB16.4 thousand, representing approximately 0.0%, 0.1%, 0.0%, 0.0% and 0.0%
of out total purchases in the same periods, respectively. Save as above, to the best of our
knowledge, all other manufacturing contractors are Independent Third Parties. We entered into
standard outsourced manufacturing agreements with these manufacturing contractors, and the terms
in these agreements are comparable to those offered to our other manufacturing contractors. Our
Directors are of the view that the transactions that we entered into with these manufacturing
contractors were on an arm’s-length, mutually independent basis under normal commercial terms.
During the Track Record Period and up to the Latest Practicable Date, we did not have any
material disputes with our manufacturing contractors.
Major Suppliers
During the Track Record Period, our major suppliers primarily include manufacturers of
modules, optical devices, control electronics, mechanical devices, sheet metal and machined parts.
Purchases from our top five suppliers in each year or period during the Track Record Period in
aggregate accounted for 26.7%, 18.9%, 25.1% and 30.1%, of our total purchases, respectively, in
the same periods. Purchases from our largest supplier in each year or period during the Track
Record Period accounted for 9.2%, 8.6%, 9.2% and 13.3% of our total purchases, respectively, in
the same periods.
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The following table sets forth details of our five largest suppliers in each year or period
during the Track Record Period:
Year ended December 31, 2022
Suppliers Products purchased
Purchase
amount
%o ft o t a l
purchases
Background and principal
business activity
Length of business
relationship with
our Group Credit terms Settlement method
(RMB ’000)
Supplier A .... Spindle 125,383 9.2 A public company listed on the
NASDAQ that operates in
detection, tracking and
imaging, medical devices,
precision motion, laser
processing, and robotics and
automation sectors
Above 5 years 30 days Wire transfer
Supplier B .... Control systems 111,507 8.2 Primarily engages in the
development and
manufacturing of control
technology products and drive
electronics in the industrial
field
Above 5 years 30 to 60 days Letter of credit
Han’s Laser .... Chiller 52,567 3.9 A public company listed on the
Shenzhen Stock Exchange that
provides solutions for laser,
robotics and automation
technologies; research and
development and production
of other robot-related products
Above 5 years 30 to 120 days, or 50% paid in
advance with the remaining
balance payable upon receipt
Wire transfer or
bank draft
Supplier D .... Machine bed
assembly
39,150 2.9 Engages in production and sales
of various machinery and
equipment, R&D of industrial
automation, produces
precision machine tools, and
conducts
Above 5 years 30 days Wire transfer or
bank draft
Supplier E .... Spindle 35,026 2.6 A public company listed on the
Shenzhen Stock Exchange that
engages in the production and
sales of various machinery
and components, research and
development of automotive
parts
Above 5 years 60 days Wire transfer or
bank draft
Total ....... 363,633 26.7
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Year ended December 31, 2023
Suppliers Products purchased
Purchase
amount
%o ft o t a l
purchases
Background and principal
business activity
Length of business
relationship with
our Group Credit terms Settlement method
(RMB ’000)
Supplier B .... Control systems 91,727 8.6 Primarily engages in the
development and
manufacturing of control
technology products and drive
electronics in the industrial
field
Above 5 years 30 to 60 days Letter of credit
Han’s Laser .... Chiller and electric
machine
31,957 3.0 A public company listed on the
Shenzhen Stock Exchange that
provides solutions for laser,
robotics and automation
technologies; research and
development and production
of other robot-related products
Above 5 years 30 to 120 days, or 50% paid in
advance with the remaining
balance payable upon receipt
Wire transfer or
bank draft
Supplier D .... Machine bed
assembly
29,446 2.8 Engages in production and sales
of various machinery and
equipment, R&D of industrial
automation, produces
precision machine tools, and
conducts
Above 5 years 30 days Wire transfer or
bank draft
Supplier F .... Laser 25,868 2.4 A public company listed on the
NASDAQ that engages in the
business of providing
laser-related equipment,
components, and services
Above 5 years 30 days Wire transfer or
bank draft
Supplier G .... Pneumatic devices 23,199 2.2 Engages in the development and
trade of electronic
components, automation
control, and mechanical
equipment
Above 5 years 60 to 120 days Wire transfer or
bank draft
Total ....... 202,197 18.9
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Year ended December 31, 2024
Suppliers Products purchased
Purchase
amount
%o ft o t a l
purchases
Background and principal
business activity
Length of business
relationship with
our Group Credit terms Settlement method
(RMB ’000)
Supplier B .... Control systems 198,478 9.2 Primarily engages in the
development and
manufacturing of control
technology products and drive
electronics in the industrial
field
Above 5 years 30 to 60 days Letter of credit
Supplier F .... Laser 134,626 6.3 A public company listed on the
NASDAQ that engages in the
business of providing
laser-related equipment,
components, and services
Above 5 years 30 days Wire transfer or
bank draft
Supplier A .... Spindle 93,949 4.4 A public company listed on the
NASDAQ that operates in
detection, tracking and
imaging, medical devices,
precision motion, laser
processing, and robotics and
automation sectors
Above 5 years 30 days Wire transfer
Supplier H .... Electric machine 65,511 3.0 Engages in the business of
producing metal cutting
machine tools, motors, and
industrial control systems, and
electromechanical production
Above 5 years 30 days Wire transfer or
bank draft
Supplier I ..... Bearings, guide rails 47,868 2.2 Specializes in the production of
linear motion system products,
including linear guides, ball
screws, ball splines, and linear
actuators
Above 5 years 30 days Wire transfer or
bank draft
Total ....... 540,432 25.1
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Ten months ended October 31, 2025
Suppliers Products purchased
Purchase
amount
%o ft o t a l
purchases
Background and principal
business activity
Length of business
relationship with
our Group Credit terms Settlement method
(RMB ’000)
Supplier B .... Control systems 463,194 13.3 Primarily engages in the
development and
manufacturing of control
technology products and drive
electronics in the industrial
field
Above 5 years 30 to 60 days Letter of credit
Supplier A .... Spindle 186,041 5.4 A public company listed on the
NASDAQ that operates in
detection, tracking and
imaging, medical devices,
precision motion, laser
processing, and robotics and
automation sectors
Above 5 years Prepayment Wire transfer
Supplier F .... Laser 154,934 4.5 A public company listed on the
NASDAQ that engages in the
business of providing
laser-related equipment,
components, and services
Above 5 years 30 days Wire transfer or
bank draft
Supplier H .... Motor 130,458 3.8 Engages in the business of
producing metal cutting
machine tools, motors, and
industrial control systems, and
electromechanical production
Above 5 years 30 days Wire transfer or
bank draft
Supplier E .... Spindle 112,005 3.2 A public company listed on the
Shenzhen Stock Exchange that
engages in the production and
sales of various machinery
and components, research and
development of automotive
parts
Above 5 years 60 days Wire transfer or
bank draft
Total ....... 1,046,632 30.1
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Save for Han’s Laser, to the knowledge of our Directors, as of the Latest Practicable Date,
none of our Directors and their respective associates or any of our shareholders holding more than
5% of our issued share capital had any interests in any of our five largest suppliers in each year or
period during the Track Record Period. For details of Han’s Laser’s shareholding status, see
“History and Corporate Structure.”
SUPPLIER-CUSTOMER OVERLAP
Among our top five customers in each year or period during the Track Record Period,
Customer B was also our supplier, selling laser drilling machines and testing boards to us in 2022,
2023, 2024 and the ten months ended October 31, 2025; Customer C was also our supplier, selling
testing boards to us in 2022; Customer F was also our supplier, selling laser drilling machines to
us in 2023 and 2024; and Customer M was also our supplier, selling testing boards to us in 2023,
2024 and the ten months ended October 31, 2025. The equipment purchased from these
overlapping customers mainly comprised used machines. The rationale for purchasing these used
machines from these overlapping customers was mainly to facilitate product upgrades, as our
customers often traded in their used equipment when purchasing new products with higher
processing efficiency and precision from us. By acquiring these used machines, we were able to
recycle, refurbish, or properly dispose of them, which also allowed us to reduce certain production
costs and strengthen our business relationships with customers. In 2022, 2023, 2024 and the ten
months ended October 31, 2025, our revenue from top five customers who were also our suppliers
of the respective periods was RMB484.5 million, RMB189.9 million, RMB161.4 million and
RMB145.4 million, respectively, representing 17.4%, 11.6%, 4.8% and 3.4% of our total revenue
in the same periods. In 2022, 2023, 2024 and the ten months ended October 31, 2025, (i) our
purchase amount from Customer B who was also our supplier was RMB10.3 million, RMB16.0
million, RMB4.2 million and RMB5.6 million, representing 0.8%, 1.5%, 0.2% and 0.2% of our
total purchase amount in the same periods, respectively, (ii) our purchase amount from Customer C
who was also our supplier was RMB4.3 thousand, nil, nil and nil, representing 0.0%, nil, nil and
nil of our total purchase amount in the same periods, respectively, (iii) our purchase amount from
Customer F who was also our supplier was nil, RMB0.2 million, RMB1.0 million and nil,
representing nil, 0.0%, 0.0% and nil of our total purchase amount in the same periods,
respectively, and (iv) our purchase amount from Customer M who was also our supplier was nil,
RMB6.6 thousand, RMB8.3 thousand and RMB5.5 thousand, representing nil, 0.0%, 0.0%, and
0.0%, of our total purchase amount in the same periods, respectively. In 2022, 2023, 2024 and the
ten months ended October 31, 2025, (i) our gross profit from Customer B who was also our
supplier was RMB76.1 million, RMB44.4 million, RMB42.0 million and RMB36.7 million,
respectively, (ii) our gross profit from Customer C who was also our supplier was RMB28.1
million, RMB10.8 million, RMB6.8 million and RMB0.3 million, respectively, (iii) our gross profit
from Customer F who was also our supplier was RMB15.0 million, RMB25.3 million, RMB37.0
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million and RMB52.3 million, respectively, and (iv) our gross profit from Customer M who was
also our supplier was RMB16.1 million, RMB3.3 million, RMB22.2 million and RMB43.5 million,
respectively.
Among our top five suppliers in each year or period during the Track Record Period, Han’s
Laser was also our customer, purchasing drilling equipment from us in 2022, 2023 and 2024;
Supplier B was also our customer, purchasing formation equipment from us in 2022; and Supplier
H was also our customer, purchasing motor mounting plates formation equipment from us in 2023
and 2024. In 2022, 2023, 2024 and the ten months ended October 31, 2025, our purchase amount
from top five suppliers who were also our customers of the respective periods was RMB164.1
million, RMB32.0 million, RMB65.5 million and nil, respectively, representing 12.0%, 3.0%, 3.0%
and nil of our total purchase amount in the same periods. In 2022, 2023, 2024 and the ten months
ended October 31, 2025, (i) our revenue from Han’s Laser who was also our customer was
RMB7.3 million, RMB2.3 million, RMB0.9 million and RMB5.3 million, representing 0.3%, 0.1%,
0.0% and 0.1% of our total revenue in the same periods, respectively, (ii) our revenue from
Supplier B who was also our customer was RMB0.5 million, nil, nil and nil, representing 0.0%,
nil, nil and nil of our total revenue in the same periods, respectively, and (iii) our revenue from
Supplier H who was also our customer was nil, RMB0.4 million, RMB2.3 million and nil,
representing nil, 0.0%, 0.1% and nil of our total revenue in the same periods, respectively. In
2022, 2023, 2024 and the ten months ended October 31, 2025, (i) our gross profit from Han’s
Laser who was also our customer was RMB2.3 million, RMB0.2 million, RMB0.5 million and
RMB1.7 million, respectively, (ii) our gross profit from Supplier B who was also our customer was
RMB0.1 million, nil, nil and nil, respectively, and (iii) our gross loss from Supplier H who was
also our customer was nil, RMB2.0 thousand, approximately RMB0.2 thousand and nil,
respectively.
According to CIC, such overlap is common, especially considering our leading market
position and market share, as well as the depth of our collaboration with a wide customer and
supplier base, which make it more common for our customers/suppliers to engage with us in both
selling products and services to and purchasing products and services from us. Our Directors are of
the view that the transactions with the overlapping supplier-customers were conducted at
arm’s-length, mutually independent and under normal commercial terms. Negotiations of the terms
of our sales to and purchases from these overlapping supplier-customers were conducted on an
individual basis, and the sales and purchases were neither inter-connected nor inter-conditional
with each other. For each of the overlapping supplier-customers, the key terms of our sales and
supply agreements were substantially similar to those of our other customers or suppliers.
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TARIFFS IMPOSED BY THE UNITED STATES
Since February 2025, the United States has imposed a series of new tariffs on Chinese goods,
including a 20% US Tariff and additional Reciprocal Tariffs that have fluctuated between 10% and
125% for Chinese imports, with certain consumer electronics exempt. China responded with its
own tariffs on U.S. goods. Following further bilateral negotiations between the United States and
China and subsequent executive and administrative measures, the U.S. tariff regime applicable to
PRC-origin goods has been adjusted. As of the Latest Practicable Date, PRC-origin goods in
general are subject to a 10% additional tariff and a 10% reciprocal tariff, resulting in an aggregate
additional U.S. tariff rate of approximately 20%, while certain consumer electronics, including
smartphones and computers, are exempt from the reciprocal tariff and are subject only to the 10%
additional tariff. As of the Latest Practicable Date, U.S.-origin goods imported into China are in
general subject to an additional 10% reciprocal tariff as a countermeasure to U.S. Section 301
tariffs, and certain U.S.-origin goods are further subject to additional tariffs under other Chinese
countermeasures, in each case on top of the applicable most-favored-nation or other base import
tariff rates. The tariff regime remains subject to ongoing trade negotiations and legal challenges,
and its future application is uncertain. See “Regulation Overview — Laws and Regulations
Relating to Tariffs Imposed by The United States.”
Impact of the Tariffs Imposed by the United States on Our Business
In 2022, 2023, 2024 and the ten months ended October 31, 2025, the purchase amount of raw
materials with the Europe as the shipping origin accounted for 8.7%, 9.6%, 10.0% and 13.6% of
our total purchases, respectively. In 2022, 2023, 2024 and the ten months ended October 31, 2025,
the purchase amount of raw materials with the U.S. as the shipping origin accounted for 14.1%,
7.2%, 13.9% and 11.4% of our total purchases, respectively. Certain of our major raw materials,
such as spindle and laser, were subject to tariff during the Track Record Period while there had
been no fluctuation in most of the tariff applicable to our major raw materials during the Track
Record Period. Since the implementation of the tariffs imposed by the united states in February
2025, the proportion of our raw material purchases with the U.S. as the shipping origin has
remained low. Furthermore, these raw materials are generally available from alternative non-U.S.
suppliers, providing us with flexibility to adjust our sourcing strategy as needed. During the Track
Record Period and up to the Latest Practicable Date, we did not purchase any chips with the U.S.
as the shipping origin.
In Addition, we are generally able to pass on increases in raw material costs to our
customers. The selling prices of our products are typically determined on a per-order basis, taking
into account the prevailing raw material costs at the time of each order. See “— Supply Chain
Management — Raw Materials and Procurement.” Therefore, our Directors believe that the
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potential pressure on the pricing of our products resulting from the Additional US Tariffs could be
partially passed on to our customers. Moreover, according to CIC, our customers are generally able
to pass on the economic burden caused by tariffs to their downstream customers or end consumers.
Considering that (i) our industry position and reputation, as well as the widely recognized
quality of our product; (ii) we have long business relationship with customers which are reputable
companies and they have high quality requirements on suppliers; and (iii) we have actively
expanded our sourcing from non-U.S. suppliers, thereby reducing our procurement proportion from
U.S. suppliers. This is expected to further enhance our flexibility in global procurement and
strengthen our ability to serve international customers.
Since January 1, 2025 and up to the Latest Practicable Date, we had not received any request
from our customers which may cause significant pricing pressure as a result of the imposition of
the Additional US Tariffs and none of our customers, including major customers, had cancelled
their existing orders or request re-negotiation of prices for existing orders as a result of the
Additional US Tariffs.
Based on the information currently available and subject to changes and development of the
tariffs imposed by the United States which is highly unpredictable and associated risks as detailed
in “Risk Factors,” as of the Latest Practicable Date, our Directors are of the view that the
Additional US Tariffs is not expected to have a material and adverse impact on our Group’s
operations and financial performance.
However, given the unpredictability of the development of the tariffs imposed by the United
States, we cannot assure you that our customers will not request changes in prices or other contract
terms, or reduce their orders in the future due to the tariffs or a decrease in overall demand for
specialized PCB production equipment. Please see “Risk factors — Changes in international trade
policies, geopolitics and trade protection measures, export control and economic or trade sanctions
may materially and adversely affect our business, financial condition and results of operations.”
COMPETITION
According to CIC, the specialized PCB equipment industry is highly competitive and
relatively fragmented, with the top five manufacturers in the industry in China accounting for
approximately 23.9% of the total market share in terms of revenue in 2024. According to CIC, we
were the China’s largest specialized PCB production equipment manufacturer in terms of revenue
in 2024, with a market share of 10.1% in China. We believe that our competitive position is
underpinned by our strengths, including our market position, exceptional R&D capabilities and
technologies, production capacity and supply management expertise, quality and stable customer
base, and experienced management team. We believe that there are high barriers for our
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competitors to enter into the market, which include, among other things, technology, scale
production experience, capital investment, supply chain and customer base. See “Industry
Overview.”
LOGISTICS
We engage qualified third-party logistics service providers for the delivery of finished
products from our production facilities to locations specified by our customers. We set strict
standards for the transportation of our products that these third-party logistics service providers are
required to follow and we evaluate the third-party logistics service providers on their compliance
and performance to ensure smooth delivery of products to customers. Through ongoing
enhancements, we are consistently improving delivery timeliness, accuracy and customer
satisfaction while achieving cost reductions. To the best of our knowledge, all of these logistics
service providers are Independent Third Parties.
During the Track Record Period and up to the Latest Practicable Date, we had not
experienced any significant delay or inappropriate handling of goods that materially and adversely
affected our business operations.
INVENTORY MANAGEMENT
Our inventories mainly include raw materials, work-in-progress, semi-finished and finished
products.
We focus on optimizing our inventory management and actively monitor our inventory levels
based on the amount required for production, as supplemented by safety stock. For standardized
components and basic materials, we maintain a reasonable inventory level and update our
inventory plan regularly based on factors such as estimated consumption, product demand and
prevailing market prices for the relevant raw materials and components. For accessories, we
maintain a safety stock to compensate for any unexpected increases in demand or delay in supply.
For custom components, we place purchase orders for raw materials and components upon signing
sales contracts with the customer and based on our production plans.
In addition, we track and monitor the flow of goods and inventory levels through our ERP
system. We also retest products to ensure that they are still suitable for their intended use after
reaching their designated storage period.
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INTELLECTUAL PROPERTY
We depend on our proprietary technologies and production know-how to maintain our
competitive position in the markets in which we operate, and we create intellectual property
through our extensive R&D activities. Our general policy is to apply for patents on an ongoing
basis, in China and other appropriate jurisdictions, on patentable developments that are considered
to have commercial significance. Our portfolio of patents covers our proprietary technologies used
in products as well as many aspects of our product design and production processes.
We seek to protect our intellectual property and proprietary rights primarily through
intellectual property laws, relying on a combination of patent, trademark, trade secret and other
intellectual property laws in China and other countries. As of the Latest Practicable Date, we had
obtained approximately 1,103 patents, 254 invention patents, 369 software copyrights, 68
trademarks, and two domain names in China, as well as one registered patent, two trademarks, and
19 patent applications overseas.
We have a range of internal control policies and measures in place to protect our intellectual
property rights and trade secrets. We proactively pursue patent applications for our technological
innovations and utilize our patent rights to safeguard our legitimate interests. Meanwhile, we take
reasonable steps to detect possible infringement of our intellectual property rights. Upon
identifying potential patent infringements by any competitors, we conduct thorough analyses and
comparisons of the competing products. For products that are confirmed to infringe on our patents,
we typically take legal actions promptly by securing evidence and filing relevant lawsuits. This
proactive approach underscores our commitment to protecting our intellectual property and
maintaining our competitive edge in the market. We rely on non-disclosure agreements to protect
our interests in non-patentable know-how and hard-to-patent production processes. All contracts
we enter into with employees, suppliers and other strategic partners are reviewed and approved by
our in-house legal team to ensure that they contain adequate safeguards to prevent unauthorized
disclosure. To the best of our knowledge and belief, our intellectual property rights have not been
subject to any material intellectual property claims by third parties during the Track Record Period
and as of the Latest Practicable Date.
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EMPLOYEES
As of October 31, 2025, we had a total of 3,191 full-time employees, all of whom were
located in China. The following table sets forth the number of full-time employees by function as
of October 31, 2025:
Business Function
Number of
Employees
Production ...................................................... 1,125
Sales .......................................................... 749
R&D .......................................................... 871
Finance ........................................................ 58
Administration .................................................. 388
Total .......................................................... 3,191
We use various recruitment methods, including campus recruitment, online recruitment, other
external recruitment channels as well as internal referrals and transfers. In addition to salaries and
benefits, we generally provide performance-based bonuses for our full-time employees and
commission for our sales and marketing staff.
We enter into standard labor contracts with our full-time employees with confidentiality,
intellectual property, and non-compete provisions, with the exception that we do not enter into
non-compete provision with our production employees. As set out in these agreements, employees
are required to maintain confidentiality of our trade secrets, proprietary information and other
confidential data during and after their employment. All intellectual property created by employees
in the course of their employment, including patents, trademarks, copyrights, and trade secrets,
belongs to us. The employment contracts also include a standard non-compete covenant that
prohibits employees from competing with us, directly or indirectly, during their employment and
for a period not more than two years after termination of their employment.
We have established a comprehensive system for employee training and development,
including general trainings covering corporate culture, employee rights and responsibilities,
occupational health and safety, data security, and other logistics aspects, as well as specific
trainings that improve employees’ knowledge and expertise in certain important areas related to
our business. We are committed to making continued efforts to provide an engaging working
environment to our employees. Furthermore, we have a performance appraisal system in place
which assesses the performance of the management personnel based on the overall business
objectives.
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We have established labor unions for our employees. We believe we maintain a good working
relationship with our employees and we have not experienced any material labor dispute or any
difficulty in recruiting staff for our operations during the Track Record Period and up to the Latest
Practicable Date.
Under the applicable regulations in China, we are required to participate in various
government-sponsored employee benefit plans, including certain social insurance, housing funds
and other welfare-oriented payment obligations, 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.
Social Insurance and Housing Provident Fund
According to the Social Insurance Law of the PRC ()a n d
other relevant regulations, we are required to provide our employees with welfare schemes
covering social insurance. According to the Administrative Regulations on Housing Provident
Funds (၍ଣૢԷ), we are required to make housing provident fund contributions
for our employees. During the Track Record Period, we failed to make contributions to the social
insurance and housing provident funds in full amount required by the relevant PRC laws and
regulations, primarily due to certain employees were unwilling for us to pay the social insurance
and housing provident fund contributions in full as it requires additional contributions from the
employees.
Our PRC Legal Advisor has advised us that, pursuant to relevant PRC laws and regulations,
we may be ordered by the relevant PRC authorities to pay the outstanding social insurance
contributions within a prescribed time limit and may be subject to an overdue charge of 0.05% of
the delayed payment per day. If such payment is not made within the stipulated period, the
competent authority may further impose a fine from one to three times the amount of any overdue
payment. The shortfall amount of social insurance and housing provident fund contributions is
estimated to be approximately 1.6%, 2.8%, 1.7% and 1.2% of our total revenue for for 2022, 2023,
2024 and the ten months ended October 31, 2025, respectively. Our PRC Legal Advisor has further
advised us that, pursuant to relevant PRC laws and regulations, if we fail to pay the full amount of
housing provident fund contributions as required, the housing provident fund management center
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 the PRC courts for compulsory
enforcement.
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During the Track Record Period and up to the Latest Practicable Date, we have not received
any notice requiring us to pay any outstanding social insurance and housing provident fund
contributions, nor have we been subject to any administrative action or penalty by the relevant
regulatory authorities with respect to our social insurance and housing provident fund
contributions. If the relevant authorities order us to fully contribute the social insurance and/or
housing provident funds, we would make full contributions and take rectification measures as soon
as possible within the specified period.
Our Directors believe that such non-compliance would not have a material and adverse effect
on our business and results of operations, considering that: (i) as advised by our PRC Legal
Advisor, based on the relevant regulatory policies and the facts stated above, the likelihood that
the relevant authorities would take the initiative to require us to pay the shortfall for social
insurance and housing provident fund contributions or that we would be subject to material
administrative penalties due to our failure to provide full social insurance and housing provident
fund contributions within the stipulated period for our employees is remote. In addition, according
to the Urgent Notice of the General Office of the Ministry of Human Resources and Social
Security on Implementing the Spirit of the Executive Meeting of the State Council in Stabilizing
the Collection of Social Security Contributions (஫࿏ໝྼ਷
 ) promulgated on September 21,
2018, all local authorities responsible for the collection of social insurance are strictly forbidden to
conduct self collection of historical unpaid social insurance contributions from enterprises; (ii)
during the Track Record Period and up to the Latest Practicable Date, we have not received any
notice requiring us to pay any outstanding social insurance and housing provident fund
contributions; and (iii) we were not aware of any material labor disputes with respect to social
insurance and housing provident fund contribution. As a result, we did not make any provisions in
connection with such non-compliances during the Track Record Period and up to the Latest
Practicable Date. See “Risk Factors — Risks Relating to Our Business and Industry — Failure to
make fully and timely social insurance and housing provident fund contributions for some of our
employees as required by PRC laws and regulations may subject us to payments of outstanding
amounts, overdue charges or penalties imposed by relevant governmental authorities.”
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Internal Control and Remedial Measures
We have taken the following internal control measures to ensure compliance with the social
insurance and housing provident fund contribution requirements under the relevant laws and
regulations to the extent practicable:
 Increasing awareness of developments in the law . Regularly keep abreast of the latest
developments in PRC laws and regulations relating to social insurance and housing
provident funds; and
 External counsel . Consult external legal counsel for advice on relevant PRC laws and
regulations.
Going forward, we will continue to implement the above measures to ensure we are in
compliance with the social insurance and housing provident fund contributions requirements under
the relevant laws and regulations. As advised by our PRC Legal Advisor, based on the relevant
regulatory policies and the facts stated above, the likelihood that the relevant authorities would
take the initiative to require us to pay the shortfall for social insurance and housing provident fund
contributions or that we would be subject to material administrative penalties due to our failure to
provide full social insurance and housing provident fund contributions within the stipulated period
for our employees is remote. If we receive any notice from the relevant authorities requiring us to
rectify, pay or make up social insurance and housing provident fund contributions within a
specified period, we will promptly comply with the requirements of such notice. In addition, we
will proactively communicate with relevant local authorities to keep up to date with the applicable
laws and regulations concerning social insurance and housing provident funds. We will also
communicate such updates with our employees to allow them to better understand the relevant
laws and regulations, increasing their understanding of the regulatory requirements so as to
enhance our compliance with the applicable laws and regulations.
Dispatched Workers
We dispatched workers from labor dispatch agencies in the PRC during the Track Record
Period. We entered into service agreements with certain independent labor dispatch agencies to
engage dispatched workers. According to the service agreements, the individuals dispatched by the
service providers are employees of such providers. The service providers are therefore required to
bear the costs of salaries, social insurance and housing provident funds or other employee benefits
of these dispatched workers, while we are responsible for paying service fees to such employment
agencies. We have entered into agreements with labor dispatch agencies. We consistently conduct
job training for dispatched workers as per the agreement. We evaluate the performance of the
dispatched workers during their probationary period and monitor for any violations during their
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service period, including serious breaches of our rules or behavior that significantly impacts the
work assigned to us. In such instances, we have the option to inform the labor dispatch agencies to
terminate the collaboration with the dispatched worker.
During the Track Record Period, the number of dispatched workers engaged by us and some
of our subsidiaries had exceeded the 10% regulatory threshold, primarily because with the
customers’ order demand growth, we need additional workers to deliver customer orders in short
term, resulting in the number of dispatched workers exceeding the stipulated limit in relevant
periods. According to the Interim Provisions on Labor Dispatch () (the
“Interim Provisions ”) issued on January 24, 2014 and implemented on March 1, 2014 by the
Ministry of Human Resources and Social Security, the number of the dispatched workers shall not
exceed 10% of the total number of the employees. As a result, we may be ordered to rectify the
non-compliance, and if we fail to rectify within the time period specified by the labor authority,
we might be subject to a penalty ranging from RMB5,000 to RMB10,000 per dispatched worker. If
we were ordered to make such payment, we will do so promptly and within the prescribed time
period. See “Risk Factors — Risks Relating to Our Business and Industry — We may be subject to
penalties relating to labor dispatch.”
To rectify the situation, we have minimized labor dispatch activities under the labor dispatch
agreements with our employment agents. As of the Latest Practicable Date, the number of
dispatched workers engaged by our Group accounted for less than 10% of the total number of the
staff thereof. Considering that: (i) we had not received any notice of rectification in relation to our
labor dispatch activities from any governmental authorities; (ii) nor have we been subject to any
administrative action or penalty by the relevant regulatory authorities with respect to our
dispatched workers; and (iii) we had lowered the percentage of dispatched workers engaged by us
and some of our subsidiaries to below the threshold as of the Latest Practicable Date, our PRC
Legal Advisor is of the view that the possibility of us being penalized for our non-compliance of
dispatched workers during the Track Record Period is remote.
IMPACT OF THE COVID-19
During the Track Record Period and up to the Latest Practicable Date, we had not
experienced material disruptions in our operations as a result of the COVID-19 pandemic.
Throughout the COVID-19 pandemic, our production bases were not subject to mandatory
suspension, which enabled us to maintain stable operations. We implemented a range of measures
to ensure operational continuity and employee safety, such as adopting comprehensive pandemic
prevention and control protocols, optimizing production scheduling, and diversifying our supplier
base. For example, we arranged multi-port customs clearance for imported materials and
maintained close communication with key suppliers to mitigate supply chain risks. The prices of
laser equipment, spindles, and motion control systems demonstrated a general upward trend
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globally from 2020 to 2022, peaking in 2022 due to supply chain disruptions caused by
COVID-19. However, the overall impact on our raw material costs was limited, as the majority of
our raw materials were sourced domestically with relatively stable prices. For imported materials,
we closely monitored cost fluctuations arising from exchange rate movements, tariffs, and logistics
costs, and responded by optimizing logistics arrangements and adjusting inventory levels as
appropriate. In addition, our diversified supplier network and ability to adjust product prices for
key components enabled us to manage cost increases. Therefore, our Directors are of the view that
the outbreak of COVID-19 had no material impact on our business during the Track Record Period
and up to the Latest Practicable Date.
INSURANCE
We consider our insurance coverage to be adequate and in accordance with PRC laws and
regulations and the commercial practices in the industry in which we operate. Our employees are
covered by accident insurance, critical illness insurance, overseas insurance (for employees
travelling abroad) and employer’s liability insurance (for interns and rehired retirees). Our
company and assets are covered by property insurance and cargo transportation insurance (for
machinery during shipping), property all risks insurance (for fixed assets, inventory, etc.) and
motor insurance. We will continue to review and assess our risk portfolio and make necessary and
appropriate adjustment to our insurance plans to align with our needs and with industry practice.
During the Track Record Period, we did not make any material insurance claims in relation to our
business.
However, there can be no guarantee that we will not incur losses or suffer claims beyond the
limits, or outside the relevant coverage, of our insurance policies. See “Risk Factors — Risks
Relating to Our Business and Industry — Our insurance policies may not provide adequate
coverage for all claims associated with our business operations.”
ENVIRONMENTAL, SOCIAL AND GOVERNANCE
We are committed to promoting sustainable development practices, advancing social
responsibility, and maintaining robust governance standards, reflecting our adherence to ESG
principles. We have established a comprehensive set of policies and procedures covering
environmental protection, workplace safety, employee welfare, and anti-corruption efforts.
Our operations and facilities are subject to a wide range of environmental, health, and safety
laws and regulations. We also actively reduce energy consumption and waste generation through
production process upgrades. We are dedicated to fostering a positive working environment for all
employees and place a strong emphasis on employee safety and well-being. We conduct regular
skills and safety training programs to enhance workplace safety.
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Our management regards ESG practices as a core driver for fulfilling our mission, fully
integrating sustainable-development management into our corporate strategy and operational
processes. By continuously refining our ESG policies and implementation plans, we create
long-term value for all stakeholders. We believe that this systematic approach to ESG management
not only enhances our competitive strength but also drives the sustainable development of the
entire value chain.
ESG Materiality Assessment
We have established a scientific and comprehensive ESG materiality assessment mechanism
that identifies key sustainability topics through systematic internal and external analyses. In the
internal assessment dimension, we conduct an in-depth review of the full lifecycle of our
operations, strictly benchmarking against international ESG standards, industry best practices, and
rating agency requirements. In the external assessment dimension, we continuously monitor policy
and regulatory developments and regularly conduct stakeholder surveys to gain a thorough
understanding of the expectations and concerns of customers, suppliers, and investors. Throughout
the assessment process, we consider both the actual impact of each topic on our business
performance and its potential impact on the environment and society in terms of scope, scale, and
duration.
Through multidimensional analysis, we focus on the following core ESG topics: energy
management, emissions and waste control, employee development and occupational health and
safety, sustainable supply chain management, and product responsibility. By employing a dynamic
assessment mechanism, we can accurately determine the priority of each topic, allocate
management resources scientifically, and ensure that our ESG strategy advances in synergy with
business development and stakeholder expectations.
ESG Governance
We fully recognize our responsibility to promote corporate social responsibility and integrate
it into all major aspects of our business operations. We are committed to complying with ESG
reporting requirements and to conducting our business in a manner that protects the environment
and safeguards employee health and safety, and we plan to establish a comprehensive ESG
management framework with a clear hierarchical structure, well-defined accountabilities, and
efficient operations. This framework will delineate the responsibilities of each management level,
department, and role, and introduce enhanced governance mechanisms to ensure organizational
support for all ESG initiatives. As needed, we will engage external advisors or specialized
institutions to provide professional guidance in advancing our ESG efforts. To effectively manage
ESG matters, we intend to, in accordance with the standards set out in Appendix C2 to the Listing
Rules, establish a suite of ESG policies outlining (i) appropriate risk governance for ESG matters,
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including climate-related risks and opportunities; (ii) the process for formulating ESG strategies;
(iii) ESG risk management and monitoring; (iv) the identification of key performance indicators
(“KPIs”); and (v) relevant measurement and mitigation measures. Our Board is responsible for
ESG decision-making, governance and oversight, including (i) formulating and revising ESG
strategies, frameworks and policies; (ii) assessing, managing and controlling ESG risks; (iii)
reviewing ESG objectives and evaluating their implementation; (iv) reviewing the ESG
management system and reporting; and (v) providing oversight and guidance on ESG matters.
In terms of ESG management, our Board has set clear short-term targets as well as medium-
and long-term strategies to ensure substantive progress in key areas such as carbon reduction,
resource circularity, supply chain management and information disclosure. During the Track
Record Period and up to the Latest Practicable Date, we have not been subject to any penalties for
breaches of environmental, social and governance laws and regulations.
Anti-Corruption and Anti-Bribery
We maintain a strict ethos of integrity in all our business dealings and fully comply with the
PRC Company Law, the PRC Anti-Unfair Competition Law, and other applicable national laws and
regulations. We have established a comprehensive compliance management framework and
promulgated a dedicated Anti-Fraud Management System (). During the Track
Record Period and up to the Latest Practicable Date, we have not been subject to any corruption or
bribery litigation.
Environment
Environmental and Climate-Related Risks
We place great emphasis on environmental and climate-related risks, which have been fully
integrated into our overall risk management framework. We will continuously optimize our
environmental risk management strategies, balancing business growth with resource sustainability,
and contribute to addressing global climate challenges. The risks we face fall into three main
categories — environmental risks, climate risks, and transition risks — and we have developed
targeted management measures for each.
Environmental Risks
Natural disasters, public health emergencies, or other unforeseen events may pose risks to our
business operations. Such events can disrupt production and supply chains, leading to potential
economic losses and operational downtime. We have established a Safety Management Team to
integrate climate change management into its routine operational priorities.
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Climate Risks
Our production facilities are exposed to physical risks from extreme weather events such as
typhoons and heavy rainfall. These conditions can cause power outages, floods, and other damage,
which may create safety hazards, force suspension of research and production activities, and an
increase in operating costs. Our production capacity could be severely impacted, potentially
resulting in delays and financial losses. To address this, we have implemented Procedure
E-CNC-07-036-2022_B — Emergency Preparedness and Response Control Procedure.
Transition Risks
Transition risks primarily arise from low-carbon transition requirements. We actively respond
to the national dual-carbon policy by advancing our green product portfolio and reducing the
carbon footprint of our PCB products.
We aim to enhance production efficiency, simplify process flows, and advance automation
and intelligence, thereby reducing the unit production cost per PCB. Throughout the product
lifecycle, we emphasize modularity, manufacturability, recyclability, maintainability, and
reusability. We are committed to delivering innovative PCB process solutions that significantly
lower production costs and, in turn, reduce carbon intensity across the PCB value chain.
Energy Management
As a core component of our corporate sustainability strategy, energy management plays a
vital role in our operations. We view improving energy efficiency not only as an environmental
responsibility but also as a key initiative to enhance operational efficiency and strengthen our
competitive edge. To this end, we have implemented the following measures:
 Lighting Management: We maximize the use of natural light in workspaces, meeting
rooms, corridors, and aisles, and prohibit lights being left on during lunch breaks or
when areas are unoccupied. After hours, except for security lighting, all office and
production-area lighting must be switched off.
 HVAC Management: We keep cooling temperature shall not be, lower than 26°C in
summer, and heating temperature shall not be, higher than 20°C in winter. We keep
doors and windows closed while the system is operating; draw blackout curtains when
sunlight is intense. We turn off air conditioners 30 minutes before the end of the
workday; meeting rooms may not be used by a single individual with the HV AC
running.
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 Production Equipment Management: We power down all production-site equipment
after working hours. Nonbusiness-critical use of equipment must be registered and
approved by the relevant department in advance. Equipment requiring extended
operation during debugging must be clearly labeled and accompanied by a completed
“Equipment Power-On Continuation Request Form,” approved by the department head
and filed with the Administration Department’s Safety Management Team for periodic
inspection.
 Water Management: We strengthen daily water-conservation practices and eliminate
leaks, drips, and continuously running water. We immediately report any leaks or
equipment malfunctions to the Administration Department for repair. We promote
water-saving habits by posting reminders in restrooms, pantry areas, and other relevant
locations.
With respect to legal and regulatory compliance, we consistently benchmark against the PRC
Energy Conservation Law and rigorously standardize all production and operational activities. To
ensure the effective implementation of compliance requirements, we have established Procedure
E-CNC-07-029-2022_A — Energy and Resource Management Control Procedure; and issued the
“Notice on Strengthening Energy Conservation and Consumption Reduction Management.”
To comprehensively understand and optimize our environmental impact, we continuously
monitor key environmental indicators. The following table summarizes our primary energy
consumption for the years/periods indicated:
Years Ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
Gasoline (L) ................... 12,821.5 13,340.8 13,692.6 11,895.7 9,960.0
Diesel (L) .................... 2,218.9 24,755.1 33,430.1 27,727.6 28,917.9
Energy consumption (MWh) ...... 13,634.6 13,606.9 13,605.0 11,835.3 11,838.7
Water consumption (m 3) ......... 42,916.0 44,890.4 37,061.6 30,267.0 42,728.0
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Emissions and Waste Management
Guided by the principles of environmental protection and sustainable development, we have
established a comprehensive emissions and waste management system. We strictly comply with the
PRC Environmental Protection Law, the Integrated Emission Standard of Air Pollutants, and other
relevant laws and regulations, and ensure through regular monitoring that all emissions meet
national standards. We have successfully obtained ISO 14001 certification, an authoritative
certification in environmental management. We have established a comprehensive end-to-end waste
management procedure covering segregation, storage, transportation, disposal, and recycling, and
we conduct periodic system audits to ensure compliance.
Regarding greenhouse gas emissions, we have implemented a series of initiatives. We strictly
comply with the Integrated Emission Standard of Air Pollutants (GB 16297-1996): we have
installed the activated carbon filtration device to ensure non-methane total hydrocarbon emissions
remain below 60 mg/m
3 (standard limit 120 mg/m 3); organic exhaust is treated via a two-stage
activated carbon adsorption system before high-altitude discharge; and soldering fumes are
collected through ductwork and discharged at height.
In the field of waste management, we strictly follow the PRC Law on Prevention and Control
of Environmental Pollution by Solid Waste and other regulations, and have established a
full-spectrum waste management system. Specifically, we have implemented:
 Domestic Sewage Treatment is treated through a three-stage septic tank system before
connecting to the municipal sewer network for further processing at the Fuyong Water
Purification Plant.
 Industrial Wash Wastewater Treatment is entrusted to a qualified third party for
transport and treatment; we do not allow discharge on site.
 Domestic Solid Waste is collected and removed regularly by the sanitation authority.
 General Solid Waste is collected and recycled by designated third-party recyclers.
 Hazardous Waste is transferred and disposed of by a qualified third party.
 Production Waste Reduction requires transition of equipment assembly and debugging
records from paper to electronic format; we reuse of dedicated packaging materials in a
closed-loop cycle.
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The following table presents our pollutant discharge data for the years/periods indicated:
Years Ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
Hazardous chemicals (tones) ...... 9.6 27.1 26.8 22.7 42.4
Domestic sewage (m 3/a) ......... 42,916.0 44,890.4 37,061.6 30,267.0 42,728.0
Industrial wash wastewater (m 3/a) .. 9.1 27.0 26.7 22.6 42.2
Spent activated carbon (tones) .... 0.0 0.1 0.0 0.0 0.0
Social Responsibility
Employees
In terms of labor and employment, we strictly adhere to the PRC Labor Law, the PRC Labor
Contract Law, and other relevant laws and regulations. We consistently uphold a “people-oriented”
talent philosophy, promote team spirit, value talent, respect and safeguard individual employee
rights, and pay close attention to employee physical and mental health, safety, and personal
development. Through multiple channels, we provide equal development opportunities and a
positive working environment, emphasize talent cultivation, and regularly conduct training
programs based on employee needs to foster mutual growth. We also offer annual health check-up
programs to ensure employee well-being.
Talent Development and Incentives
Talent Development System
We have established a comprehensive talent development program. We have built a
systematic training framework to enhance employees’ professional expertise and overall
competencies through leadership training, specialized R&D courses, and general skills
development. This robust support ensures a solid talent base for our ongoing innovation and
growth.
Our corporate governance and corporate culture are centered on the principle of
“innovation-driven and win-win collaboration” ( ௴อᚨਗd՘Ъ΍ᙊ ) and adhere to the concepts
of standardized operations and sustainable development. We were listed on the Shenzhen Stock
Exchange’s ChiNext Market in 2022 and have maintained a healthy governance framework. In
terms of talent development, we have established a tiered development mechanism. Our “Young
Eagle Program” (ྌ) and “Flying Eagle Program” (ྌ) are designed to improve the
quality of our key talent. We have also implemented a long-term incentive mechanism covering
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our management team and key R&D employees, and we adhere to the principle of
“performance-driven and benefit-sharing” (ଘˏeлू΍Ԯ ), which tightly links remuneration
packages with respective R&D contributions and our performance. We believe that a sound talent
development mechanism not only ensures a strong talent pool for our quality, sustainable and
international expansion, but also enables us to stand out among the fierce competition and
maintain our leading industry position.
Talent Incentive Mechanisms
To further develop and refine our long-term incentive framework, attract and retain
exceptional talent, and fully motivate our core teams, we implement equity- and option-based
incentive plans when appropriate. We have implemented the 2023 Restricted Share Incentive
Scheme.
We have established a comprehensive learning and development framework, comprising a
series of programs such as new-hire onboarding, occupational safety training, team-level skills
workshops, technical proficiency courses, and specialized management training. In parallel, we run
a new-employee probation mentoring scheme and host “Talent Program” exchange seminars and
other targeted activities to support the growth of employees at all levels.
Looking ahead, we will continue to optimize our talent development framework and refine
incentive mechanisms to create an even stronger career platform, fulfilling our value commitment
to mutual growth with our employees. Through systematic training and incentive initiatives, we
aim to build a high-calibre, high-performance workforce that underpins our sustainable
development.
Occupational Health, Safety and Care
We have established a comprehensive Occupational Health and Safety (OHS) management
system. In strict accordance with national laws and regulations, we implement the following
procedures:
 Safety Education and Training Policy.
 Occupational Hygiene Control Procedure.
 Personal Protective Equipment Provision and Management Policy.
 Safety Protection Policy for Female Workers, Minor Workers, and Interns.
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Our training curriculum includes, but is not limited to: (i) Overview of our organization’s
safety performance and basic safety knowledge. (ii) OHS rules, regulations, and labor discipline.
(iii) Rights and obligations of employees regarding workplace safety. (iv) Case studies of past
accidents. (v) Emergency rescue procedures, drills, and preventive measures. (vi) Identification of
workplace hazards and environmental risk factors. (vii) Occupational injuries and fatality risks
associated with specific roles. (viii) Safety responsibilities, operational skills, and mandatory
standards for each position. (ix) Self-rescue, mutual aid, first-aid methods, evacuation, and
handling of on-site emergencies. (x) Proper use and maintenance of safety equipment and personal
protective gear. (xi) OHS status and regulations specific to each workshop or production section.
(xii) Accident prevention measures and key safety considerations. (xiii) Additional accident case
studies. (xiv) Standard operating procedures for each position. (xv) Coordination and handover
safety and hygiene requirements between roles. During the Track Record Period and up to the
Latest Practicable Date, we did not have any work-related facilities.
Supply Chain Management
In the area of environmental collaboration with our suppliers, we have implemented a series
of proactive measures. We have formulated a Supplier Management Procedure, onboarding
suppliers based on material characteristics and vetting their qualifications through factory audits
and sample testing; those admitted to the approved supplier list are subject to periodic performance
evaluations and re-audits. We have established long-term, stable partnerships with multiple
suppliers, creating an effective coordination mechanism.
Product Responsibility
We have successfully obtained ISO 9001:2015 quality management system certification.
Intellectual Property Management
We have established:
 Intellectual Property Management System: to standardize our IP administration and
fully leverage intellectual property in our development, this system safeguards
operational security, empowers product innovation, and builds an IP moat to strengthen
our competitive edge. It also enhances the management of intangible assets to prevent
loss and elevate the efficiency and quality of our IP governance. Pursuant to the PRC
Patent Law, Copyright Law, Trademark Law, Anti-Unfair Competition Law, and related
regulations, this policy defines management requirements for all IP types, including
patents, trademarks, copyrights, integrated circuit layout designs, and trade secrets, and
is revised in accordance with our evolving IP needs.
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 Patent Application Document Review Guidelines: These guidelines set forth the
standards for reviewing patent application documents to improve submission quality.
They are updated periodically to reflect revisions in the patent examination system and
our IP strategy.
 Software Copyright Application Materials Guidelines: These guidelines specify the
requirements for preparing and reviewing software copyright application materials to
facilitate successful registration. They are revised as necessary to comply with the latest
software copyright examination criteria.
Customer Service Management
We regularly engage in technical exchanges with customers in the PCB sub-sector, aligning
its medium and long-term product roadmaps with customers’ future technology upgrades and
industry development. We continuously tackle advanced production process challenges to drive
innovation, develop new products, and improve production workflows and product quality.
We provide 24/7 service response, offering on-site professional support for key accounts. For
overseas customers, our agents train local service personnel, and we deliver professional training
sessions and remote video support, striving to resolve customer issues in the shortest possible
time. We have also pioneered value-added preventive maintenance services in the industry,
appointing a chief service officer for key clients. By combining on-site process and production
data, we deliver tailored solutions for capacity and quality enhancement, automated maintenance
upgrades, and legacy product performance enhancements, thereby improving production planning,
boosting operational efficiency, and reducing operating costs.
PROPERTIES
We own and lease properties in China. As of the Latest Practicable Date, all of our
production plants were located in China. Our headquarters are located in Shenzhen, China.
As of the Latest Practicable Date, none of the properties held or leased by us had a carrying
amount of 15% or more of our consolidated total assets. According to section 6(2) of the
Companies Ordinance (Exemption of Companies and Prospectuses from Compliance with
Provisions) Notice, this document is exempt from the requirements of section 342(1)(b) of the
Companies (Winding Up and Miscellaneous Provisions) Ordinance to include all interests in land
or buildings in a valuation report as described under paragraph 34(2) of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance.
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Owned Properties
As of the Latest Practicable Date, we held the land use rights of two parcels of land with an
aggregate site area of approximately 14,733.9 sq.m. in China. All of these land parcels have been
granted land use right certificates. As of the Latest Practicable Date, we owned two properties in
China with a total gross floor area of approximately 74,878.4 sq.m. These land parcels and
properties are primarily used for business operations, production and warehousing purposes. We
have obtained the title certificate for the property in China.
Leased Properties
As of the Latest Practicable Date, we leased 60 properties with a total GFA of approximately
236,712.1 sq.m. in China, which are used as production and operations, temporary warehouses, and
employee dormitories. The leases generally have a term ranging from five months to five years.
Absence of V alid Title Certificates
As of the Latest Practicable Date, lessor of 16 leased properties (with an aggregate GFA of
approximately 123,206.0 sq.m., representing approximately 52.1% of our total leased GFA) did not
provide valid title certificates. Such leased properties are mainly used as offices warehouses and
staff dormitories. Our PRC Legal Advisor is of the view that:
(i) with regards to 13 of those leased properties with an aggregate GFA of approximately
75,852.0 sq.m., which lack construction project planning permits and valid title
certificates, our use of these properties may be affected by third parties’ claims or
challenges against the lease. In addition, if the lessors do not have the requisite rights to
lease these properties, the relevant lease agreements may be deemed invalid, and, as a
result, we may be required to vacate these leased properties and relocate our operation
sites. However, in the event that we are unable to continue using these leased properties,
we, as the tenant, will not be required to continue to pay the rents. In addition, as a
tenant, we will not be subject to any administrative penalties by relevant authorities in
this regard. The lessor has confirmed their legal ownership of the properties and has
committed to fulfilling their obligations under the signed lease agreements. Should there
be any difficulties in performing the lease agreements, the lessor will promptly inform
us and arrange for the alternative leased properties in accordance with the lease terms;
and
(ii) with regards to three of those leased properties with an aggregate GFA of approximately
47,354 sq.m., which lack valid title certificates and/or valid state-owned land use rights
certificates, the lease contracts we entered into with lessors are lawful and valid. The
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lessors were applying for the relevant title certificates and/or land use rights certificates,
and the defects of such leased properties would not materially and adversely affect our
business. In addition, as a tenant, we are not subject to any administrative penalties by
relevant authorities in this regard.
Our Directors believe that the likelihood of our business and results of operations being
materially and adversely affected by these title defects is remote, considering that (i) as of the
Latest Practicable Date, we have not been required to cease operations due to the lessor’s right to
lease being challenged by a third-party rights holder; (ii) Dazhu Holdings and Mr. Gao has agreed
to indemnify us against any claims, fines, economic losses and other losses from relocation which
may arise from such defects; and (iii) we maintain a pool of site candidates and our Directors
believe that we would be able to relocate to a different site without materially and adversely
affecting our business and results of operations should we be required to do so.
Non-registration of Lease Agreements
As of the Latest Practicable Date, 19 lease agreements had not been registered with relevant
authorities. As the registration of a lease agreement requires the cooperation between the lessor
and lessee and lessors are typically unwilling to undertake the administrative burden due to the
low risk of penalty, we were not able to complete the registration of lease agreements mentioned
above. We have adopted internal policies that (i) request our employees to proactively coordinate
with lessors to complete the registration for all of our lease agreements; and (ii) require our
employees to complete the registration of lease agreements in instances in which lessors are
willing to cooperate in such procedures.
As advised by our PRC Legal Advisor, the non-registration of lease agreements will not
affect the validity of the lease agreements, but the relevant local housing administrative authorities
can require us to complete registrations within a specified timeframe and we may be subject to a
fine of between RMB1,000 and RMB10,000 for any delay in making registration for each of these
lease agreements. The aggregate amount of maximum fine will be approximately RMB0.3 million,
which our Directors believe will not have any material adverse impact on our business operations.
As of the Latest Practicable Date, in relation to these 19 leased properties, we have not been
required by the relevant local housing administrative authorities to complete the registrations, nor
been penalized or fined by the relevant authorities. In addition, we have been more stringent in
terms of requiring our lessors to cooperate with us in registering our lease agreements with the
relevant housing administrative authorities.
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Having considered the foregoing, our Directors believe that does not constitute material nor
systemic non-compliance of our Group, and the non-registration of lease agreements described
above will not, individually or in the aggregate, materially affect our business and results of
operation.
LICENSES, APPROV ALS AND PERMITS
During the Track Record Period and up to the Latest Practicable Date, as advised by our PRC
Legal Advisor, we have obtained all licenses, approvals, permits and certificates that are material
and necessary for our business operations, and such licenses, permits, approvals and certificates
had remained in full effect. As of the Latest Practicable Date, we held a business licence issued to
our company by the Market Supervision Administration of Shenzhen Municipality on January 4,
2024. The business licence is valid on a long-term basis and does not require renewal. As further
advised by our PRC Legal Advisor, save for the business license, we are not required to obtain any
other special licenses, approvals or permits for our business operations in the PRC.
The successful renewal of our existing licenses and permits will be subject to our fulfillment
of relevant requirements. During the Track Record Period and up to the Latest Practicable Date,
we have consistently fulfilled all such requirements. Our PRC Legal Advisor have advised us that,
on the basis of our ongoing and strict compliance with these requirements, there is no material
legal impediment to renewing such licenses and permits. As of the date of this prospectus, we have
successfully renewed all soon-to-expire material and necessary licences and permits.
LEGAL PROCEEDINGS AND COMPLIANCE
We may from time to time be subject to various legal or administrative claims and
proceedings arising from the ordinary course of business. Litigation or any other legal or
administrative proceeding, regardless of the outcome, is likely to result in substantial cost and
diversion of our resources, including our management’s time and attention. As of the Latest
Practicable Date, we and our major subsidiaries are not involved in any court, arbitral or
administrative proceedings which we believe may be of material importance to our assets and
liabilities or profits and losses nor, so far as we are aware, are any such proceedings pending or
threatened. See “Risk Factors — Risks Relating to Our Business and Industry — We may be
involved in legal proceedings and commercial or contractual disputes, which could materially and
adversely affect our reputation, business, results of operations and financial condition.”
During the Track Record Period and up to the Latest Practicable Date, we had not been and
were not involved in any material non-compliance incidents that have led to fines, enforcement
actions or other penalties that could, individually or in the aggregate, have a material adverse
effect on our business, financial condition and results of operations.
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RISK MANAGEMENT AND INTERNAL CONTROL
We are exposed to various risks during our operations. We have put in place a set of internal
control and risk management policies and procedures to address potential operational, financial,
legal and market risks identified in relation to our operations. We also periodically review these
procedures to ensure their effectiveness. Our policies and procedures relate to managing our
procurement and production, as well as monitoring our sales performance and product quality.
To monitor the ongoing implementation of our risk management policies and corporate
governance measures, we have adopted, or will continue to adopt, among other things, the
following risk management measures:
 establish an Audit Committee to review and supervise our financial reporting process
and internal control system. For the qualifications and experience of the committee
members, see “Directors and Senior Management — Management and Corporate
Governance — Audit Committee”;
 adopt policies to ensure compliance with the Listing Rules, including but not limited to
aspects related to risk management, connected transactions and information disclosure;
 organize training sessions for our Directors and senior management in respect of the
relevant requirements of the Listing Rules and duties of directors of companies listed in
Hong Kong;
 provide trainings periodically to our senior management and employees on professional
behavior requirements and ethics standards to enhance their knowledge and compliance
with applicable laws and regulations, and include relevant policies against
non-compliance in our employee discipline measures and supervision guidelines;
 enhance our reporting and records system for factories, including centralizing their
quality control and safety management systems and conducting regular inspections of
the facilities;
 establish a set of emergency procedures in the event of major quality-related issues;
 provide enhanced training programs on quality assurance and product safety procedures;
and
 distribute employee handbooks to enhance employees’ awareness of complying with
laws and regulations.
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DATA PRIV ACY POLICY
We are committed to ensuring data privacy and information security. We do not collect
personal information through public channels such as operational websites or apps, and the data
we collect is limited. During our ordinary course of business, the only personal data we collect
mainly pertains to information on our employees and key contact persons from our customers and
suppliers. We make sure to obtain adequate authorization and consent from our employees,
customers, and suppliers for collecting and processing their private information.
We have implemented robust protective measures for the privacy data we collect. These
measures include (i) establishing internal control systems such as a data security management
system, which clearly stipulate our management of data confidentiality, data approval authority,
data backup and recovery, and encryption strategy change management; (ii) strictly minimizing the
access and circulation rights of private information and requiring stringent system authorization for
the use of such information; (iii) adopting technical measures such as encryption and anti-leakage
to protect information; and (iv) establishing an information security management system to ensure
information security. In particular, we strictly limit the access to, and management of, our
employees’ personal information database to our dedicated personnel to further safeguard our
information security from unauthorized internal access.
During the Track Record Period and up to the Latest Practicable Date, we did not experience
any material information leakage or loss of operating or transaction data, nor have we been subject
to any complaint, investigation or legal proceedings in relation to data privacy. As advised by our
PRC Legal Advisor, during the Track Record Period and up to the Latest Practicable Date, we
complied with the applicable PRC laws and regulations concerning cybersecurity and data
protection in all material respects.
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AWARDS AND RECOGNITIONS
During the Track Record Period, we received awards and recognition in respect of our
products, technology and innovation. The following table sets out major awards and recognitions
we received during the Track Record Period:
Year Awards/Recognitions Awarding Entity
2025 .... Shenzhen Patent Award ( ଉέ̹ਖ਼лᆤ ) Shenzhen Municipal People’s
Government
2024 .... Guangdong Province’s Top-Rated High and New
Technology Products (ۜ)
Guangdong High-Tech
Enterprises Association
2024 .... Guangdong Industrial Design Center (ʈุ
ʕː)
Department of Industry and
Information Technology of
Guangdong Province
2024 .... Bao’an District Directory of Established Doctoral
Studios (ணͭΆุΤ፽ )
Bao’an District Human
Resources Bureau of
Shenzhen Municipality
2023 .... First Prize of the Guangdong Technological
Progress Award (ҦආӉᆤɓഃᆤ )
The People’s Government of
Guangdong Province
2022 .... Guangdong Engineering Technology Research
Center (Ӻʕː )
Department of Science and
Technology of Guangdong
Province
2022 .... National Individual Champion Product (ࠏڿ
ۜ)
The MIIT and the China
Federation of Industrial
Economics
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OVERVIEW
Our Board consists of nine Directors, comprising one executive Director, four non-executive
Directors (including one employee Director), and four independent non-executive Directors. All
Directors (except for the employee Director) are elected by the general meeting for a term of three
years which is renewable upon re-election. The independent non-executive Directors shall not hold
office for more than six consecutive years pursuant to the relevant PRC laws and regulations.
Our senior management is responsible for the management of day-to-day operations of the
Group.
DIRECTORS
The following table sets forth certain information of our Directors:
Name Age Position
Principal roles and
responsibilities
Date of
joining our Group
Date of appointment
as Director
Relationship with
other Directors and
senior management
Mr. YANG Chaohui
(เಃሾ) ........
50 Chairperson of the Board,
executive Director and
general manager
Responsible for deciding
the Company’s daily
operational plans,
development, and
investment proposals;
convening and presiding
over Shareholders and
Board meetings; and
deciding and guiding the
external affairs, major
corporate matters, and
significant business
activities of the Company
May 2003 May 2003 None
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Name Age Position
Principal roles and
responsibilities
Date of
joining our Group
Date of appointment
as Director
Relationship with
other Directors and
senior management
Mr. ZHANG Jianqun
(໊) ........
60 Non-executive Director Responsible for attending
Board meetings,
reviewing and voting on
major business decisions,
strategic planning,
investment plans, and
providing advice on the
Company’s development
direction
October 2014 October 2014 None
Mr. ZHOU Huiqiang
(մሾ੶) ........
52 Non-executive Director Responsible for attending
Board meetings,
reviewing and voting on
major business decisions,
strategic planning,
investment plans, and
providing advice on the
Company’s development
direction
November 2020 November 2020 None
Mr. DU Yonggang
(࡝)........
56 Non-executive Director Responsible for attending
Board meetings,
reviewing and voting on
major business decisions,
strategic planning,
investment plans, and
providing advice on the
Company’s development
direction
November 2020 November 2020 None
Ms. Huang Linting
(ර᜝ణ) ........
42 Non-executive Director
(Employee Director)
Responsible for attending
Board meetings,
reviewing and voting on
major business decisions,
and advising the Board in
protection of the interests
of our Group’s employees
October 2020 May 2025 None
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Name Age Position
Principal roles and
responsibilities
Date of
joining our Group
Date of appointment
as Director
Relationship with
other Directors and
senior management
Mr. QIU Yunliang
(˳༶Ԅ) ........
46 Independent non-executive
Director
Responsible for supervising
the Board as an
independent party and
safeguarding public
interests and the rights of
minority Shareholders
November 2020 November 2020 None
Ms. LI Weiwei
(ҽᑢᑢ) ........
63 Independent non-executive
Director
Responsible for supervising
the Board as an
independent party and
safeguarding public
interests and the rights of
minority Shareholders
February 2024 February 2024 None
Dr. XIN Guosheng
(Ԕ਷௷) ........
73 Independent non-executive
Director
Responsible for supervising
the Board as an
independent party and
safeguarding public
interests and the rights of
minority Shareholders
May 2024 May 2024 None
Ms. XIA Liya
(ᘆඩ) ........
43 Independent non-executive
Director
Responsible for supervising
the board as an
independent party and
safeguarding public
interests and the rights of
minority Shareholders
February 6, 2026 February 6, 2026 None
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Executive Director
Mr. YANG Chaohui ( เಃሾ), aged 50, is our executive Director, chairperson of the Board
and general manager. Mr. Yang is primarily responsible for deciding the Company’s daily
operational plans, development, and investment proposals; convening and presiding over
Shareholders and Board meetings; and deciding and guiding the external affairs, major corporate
matters, and significant business activities of the Company. He currently also serves as the
chairperson of the strategy committee.
Mr. Yang has over 20 years of experience in the PCB industry. Mr. Yang joined our Group in
May 2003, and was appointed as our Director and the general manager at the same time. He has
further been appointed as the chairperson of the Board since November 2020. Mr. Yang currently
also holds positions with various subsidiaries within the Group, including as the chairperson of
board of Mason Electronics since April 2008, the chairperson of the board of Advanced Intelligent
Machine Co., Ltd. (ʮ̡ ) since April 2016 and the executive director
and general manager of Asia Foundation since March 2021. Mr. Yang has also joined Han’s Laser
Group since February 2000, where he held various positions until November 2020, with his last
position as a vice general manager of Han’s Laser.
Prior to joining our Group, Mr. Yang previously served as the deputy director of the quality
department in the product division of Shenzhen ZTE Corporation Co., Ltd. (΅
ʮ̡, currently known as ZTE CORPORATION (ʮ̡ )), a company listed
on the Shenzhen Stock Exchange (stock code: 000063) and the Stock Exchange (stock code: 0763)
from August 1996 to January 2000.
Mr. Yang graduated from Northwestern Polytechnical University ( Г̏ʈุɽኪ ) with his
major in mechanical electronics engineering in the PRC in July 1996. He further obtained his
master of Executive Master of Business Administration (EMBA) degree from Tianjin University
(ɽኪ) in the PRC in January 2013.
Mr. Yang was awarded as the “Outstanding Innovator — the 2024 Guangdong-Hong
Kong-Macao Greater Bay Area Enterprise Innovation List” (2024 ຽಥዦɽᝄਜΆุ௴อɢ࿮ఊ —
يby the Expert Review Committee of the Guangdong-Hong Kong-Macao Greater
Bay Area Enterprise Innovation List (ึ ) and the
Shenzhen Industrial Federation ( ଉέʈุᐼึ ) in February 2025. Mr. Yang has also served as the
vice supervisor of the China Printed Circuit Association (CPCA) ( ʕ਷ཥɿཥ༩Бุ՘ึ ) and the
president of the CPCA Special Equipment Branch since November 2020.
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Non-executive Directors
Mr. ZHANG Jianqun (໊), aged 60, is a non-executive Director. He is primarily
responsible for attending Board meetings, reviewing and voting on major business decisions,
strategic planning, investment plans, and providing advice on the Company’s development
direction.
Mr. Zhang joined our Group in October 2014 and was appointed as a Director at the same
time. He has also joined the Han’s Laser Group since April 1997 as the marketing director thereof,
and currently holds various positions within the Han’s Laser Group, including as the deputy
chairperson of the board and an executive deputy director of the management and decision
committee of Han’s Laser.
Other than his commitment within our Group and the Han’s Laser Group, Mr. Zhang has
served as the general partner of Shenzhen Heno Investment Enterprise (Limited Partnership) ( ଉέ
̹Υፕҳ༟Άุ (Υྫ)) since March 2017, a limited partner at Shanghai Zhiyue Shaohan
Investment Center (Limited Partnership) ( ɪऎ౽൳ჭᖍҳ༟௴ุҳ༟ʕː (Υྫ), currently
known as Zhoushan Zhiyue Shaohan Venture Investment Center (Limited Partnership) ( Ћʆ౽൳ჭ
ᖍ௴ุҳ༟ʕː (Υྫ))) since August 2016, and a director of Shenzhen Quantum
Bio-Information Technology Co., Ltd. (ʮ̡ ) since December 2018.
Mr. Zhang obtained his bachelor’s degree in computer science from Tsinghua University ( ૶
ശɽኪ) in the PRC in August 1986.
Mr. ZHOU Huiqiang ( մሾ੶), aged 52, is a non-executive Director. He is primarily
responsible for attending Board meetings, reviewing and voting on major business decisions,
strategic planning, investment plans, and providing advice on the Company’s development
direction.
Mr. Zhou joined our Group in November 2020 and was appointed as a Director at the same
time. He has also joined Han’s Laser Group since March 2001 and currently holds various
positions within the Han’s Laser Group, including as a director, an executive deputy director of the
management and decision committee and the financial director of Han’s Laser. He also served as a
director of Guangdong Huayan Robotics Co., Ltd. (ʮ̡ ) from
September 2017 to May 2025 and has served as the director of Tianjin Han’s Haihe Investment
Management Co., Ltd. (ʮ̡ ) from April 2019 to November 2025.
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Other than his commitment within our Group and the Han’s Laser Group, from December
2015 to December 2021, Mr. Zhou served as the independent director of Shenzhen Increase
Technology Co., Ltd. (ʮ̡ ), a company listed on the Shenzhen Stock
Exchange ChiNext (stock code: 300713).
Mr. Zhou graduated from Ji’an Normal School in the PRC in July 1994. He obtained the
bachelor’s degree in accounting from Jiangxi University of Finance and Economics ( ϪГৌ຾ɽ
ኪ) in the PRC in July 2005 through online courses. He further obtained an EMBA degree from
Jilin University (ɽኪ) in the PRC in September 2017. He is also a Certified Public
Accountant in China.
Mr. DU Yonggang (࡝)aged 56, is a non-executive Director. He is primarily
responsible for attending Board meetings, reviewing and voting on major business decisions,
strategic planning, investment plans, and providing advice on the Company’s development
direction.
Mr. Du joined the Group in November 2020 and was appointed as a Director at the same
time. He has also joined Han’s Laser Group since December 2008, and also currently holds various
positions thereof, including as the board secretary and deputy director of the management and
decision committee of Han’s Laser, and a director of GYX Optoelectronics Co., Ltd. (݋
ʮ̡ ), a majority-controlled subsidiary of Han’s Laser.
Mr. Du obtained his bachelor’s degree in economics from Zhengzhou University of
Aeronautics (ʈุ၍ଣኪ৫ ) in the PRC in July 1991, and he further obtained his EMBA
degree from Jilin University (ɽኪ) in the PRC in June 2019. He obtained the board secretary
qualification in December 2008.
Mr. Du was awarded the “2022 3A Honorary Certificate for Performance Evaluation of Board
Secretary of Listed Companies” by the China Association of Public Companies in December 2022,
and the 9th New Fortune Gold Medal Secretary Award in July 2013.
Ms. Huang Linting ( ර᜝ణ), aged 42, is a non-executive Director (employee Director). She
is primarily responsible for attending Board meetings, reviewing and voting on major business
decisions, and advising the Board in protection of the interests of our Group’s employees.
Ms. Huang joined our Group in October 2020 and served as an employee supervisor from
October 2020 to May 2025. She was further elected as an employee Director in May 2025. Prior to
joining our Group, from June 2006 to April 2008, Ms. Huang worked at Shenzhen Splendid China
Development Co., Ltd. (ʮ̡ ). From May 2008 to October 2020, she
served as the project manager of the appraisal center of Han’s Laser. From June 2021 to January
DIRECTORS AND SENIOR MANAGEMENT
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--- page 265 ---
2025, she served as the supervisor at Han’s Microelectronics, a subsidiary of the Company. From
August 2022 to June 2024, she served as the supervisor at Han’s CNC Technology (Dongguan)
C o . ,L t d .(Ҧ (୷̹)ʮ̡), a subsidiary of the Company.
Ms. Huang obtained her bachelor’s degree in human resources from Guangdong College of
Commerce (ਠኪ৫ , currently known as Guangdong University of Finance and Economics ᄿ
ৌ຾ɽኪ ).
She obtained the intermediate economist certificate (human resources management) ( ʕॴ຾
ࢪ(ɛɢ༟๕၍ଣ˙Σ )) issued by the Ministry of Human Resources and Social Security of the
People’s Republic of China in November 2012.
Independent non-executive Directors
Mr. QIU Yunliang ( ˳༶Ԅ), aged 46, is an independent non-executive Director. He is
primarily responsible for supervising the Board as an independent party and safeguarding public
interests and the rights of minority Shareholders.
Prior to joining our Group, Mr. Qiu served as an auditor of Shenzhen Tianjian Xinde
Accounting Firm (הfrom July 2001 to April 2004. From November
2004 to June 2010, he successively served as auditor, senior auditor, and manager of Ernst &
Young Hua Ming LLP (הFrom July 2010 to December 2011, he was a
salary partner of Lixin Dahua Accounting Firm (הAfter that, he served as
an independent director of Shenzhen Jianyi Decoration Group Co., Ltd. (΅
ʮ̡), a company listed on the Shenzhen Stock Exchange (stock code: 002789), from June
2012 to January 2020, an independent director of Chengxin Lithium Group Co., Ltd. ( ସอ቞ঐණ
ʮ̡ ), a company listed on the Shenzhen Stock Exchange (stock code: 002240), from
February 2016 to June 2020, an independent director of Shenzhen Capol International &
Associates Co., Ltd. (ʮ̡ ), a company listed on the Shenzhen
Stock Exchange (stock code: 002949), from March 2017 to July 2018, an independent director and
a member of the audit committee of Shenzhen Clou Electronics Co., Ltd. (ٰ
ʮ̡ ), a company listed on the Shenzhen Stock Exchange (stock code: 002121), from May
2020 to June 2023, an independent director of Fujian Foctek Optoelectronics Co., Ltd. (၅त
ʮ̡ ) from January 2021 to July 2024, an independent director and a member of
the audit committee of Chipsea Technologies (Shenzhen) Corp., Ltd. (Ҧ(ଉέ)ʮ
̡), a company listed on the Sci-Tech Innovation Board of the Shanghai Stock Exchange (stock
code: 688595), from June 2019 to April 2025, and an independent director and a member of the
audit committee of Chanyuan Technology Group Co., Ltd. (ʮ̡ ), a
company listed on the Shanghai Stock Exchange (stock code: 600525) from November 2024 to
August 2025. Currently, he has served as the partner of Lixin Accounting Firm (LLP) (ࢪࠇ
DIRECTORS AND SENIOR MANAGEMENT
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ה(౷ஷΥྫ )) since January 2012, an independent director of Guangzhou Zhongshan
New Materials Co., Ltd. (ʮ̡ ) since June 2025 and an independent
director of Shenzhen Saiyuan Microelectronics Co., Ltd. (ʮ̡ ) since
August 2025.
Mr. Qiu obtained his bachelor’s degree in accounting from Xiamen University (ɽኪ)i n
the PRC in July 2001. He further obtained his degree of EMBA from Renmin University of China
(ʕ਷ɛ͏ɽኪ ) in the PRC in December 2018. He is a Certified Public Accountant in China.
He has served as a visiting professor at the School of Accounting of Jiangxi University of
Finance and Economics ( ϪГৌ຾ɽኪ ) since November 2024, with a tenure of three years.
Ms. LI Weiwei ( ҽᑢᑢ), aged 63, is an independent non-executive Director. She is primarily
responsible for supervising the Board as an independent party and safeguarding public interests
and the rights of minority Shareholders.
Prior to joining our Group, from May 2004 to March 2022, Ms. Li served as a law professor
at Shenzhen University ( ଉέɽኪ). She served as the independent director at Shenzhen Zhongxing
New Materials Technology Co., Ltd. (ʮ̡ ) from January 2019 to
June 2024. Currently, she has served as the independent director at Shenzhen Fangxiang
Electronics Co., Ltd. (ʮ̡ ) since May 2021.
Ms. Li obtained her master’s degree in law from China University of Political Science and
Law in the PRC in June 1988. She then obtained her master’s degree in law from University of
New South Wales in Australia in June 1999.
Ms. Li obtained the qualification of law professor and qualification of independent director of
listing companies in December 2004 and December 2017, respectively. Ms. Li served as the deputy
director of the Legal Affairs Committee of the Shenzhen Municipal Committee of the China
Democratic League ( ଉέ̹͏ຑ ) from March 2010 to March 2013 and as a council member of the
Chinese Society of International Law (ኪึ ) from May 2018 to May 2023.
Dr. XIN Guosheng ( Ԕ਷௷), aged 73, is an independent non-executive Director. He is
primarily responsible for supervising the Board as an independent party and safeguarding public
interests and the rights of minority Shareholders.
Dr. XIN served as the deputy general manager of Shekou Shuanglong Pen Industry Co., Ltd.
(ʮ̡ ) from January 1987 to August 1988. From August 1988 to August 2011,
Dr. Xin held various positions at HT Electronic (Shenzhen) Co., Ltd. ( ͑ઠཥɿ(ଉέ)ʮ̡),
including deputy factory director, factory director, deputy general manager, and general manager.
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From August 2011 to August 2016, he served as the general manager at HT Electronic (Shixing)
C o . ,L t d .(͑ઠཥɿ(ጳ)ʮ̡). From August 2016 to April 2023, he was a director and
deputy general manager of HT Electronic and Technology (Tianjin) Co., Ltd. (Ҧ (˂
ݵ)ʮ̡ ). Currently, Dr. Xin has served as an independent director of Guangdong Dingtai
High-tech Co., Ltd. (ʮ̡ ), a company listed on the Shenzhen Stock
Exchange (stock code: 301377), since August 2020; a director of Guangdong Zhongneng Medical
Equipment Co., Ltd. (ʮ̡ ) since October 2020; an independent director of
Ganzhou Chaoyue Technology Co., Ltd. (ʮ̡ ) since November 2023;
and an independent director of Shenzhen Jingwang Electronics Co., Ltd.
(ʮ̡ ), a company listed on the Shanghai Stock Exchange (stock code:
603228), since July 2025.
Dr. Xin obtained his bachelor’s degree in arts from Heilongjiang University ( ලᎲϪɽኪ )i n
the PRC in July 1982 and MBA degree jointly from Tsinghua University ( ૶ശɽኪ)a n d
University of Wales in July 2005. He further obtained his doctor of business administration degree
from Victoria University ( ၪεлԭɽኪ ) in Switzerland in June 2009.
Dr. Xin obtained the qualification of senior economist, senior planner and qualification of
independent director of listing companies in June 1988, November 2003 and January 2003,
respectively. He was awarded the “Excellent Paper Award” for Class 0902 of the Tsinghua
University Financial Investment and Capital Operation Senior Training Class awarded by the
Training Institute of Tsinghua University Shenzhen Graduate School in June 2011. He received the
Outstanding Contribution Award of the Electronic Manufacturing and Packaging Technology
Branch of the Chinese Institute of Electronics awarded by the Electronic Manufacturing and
Packaging Technology Branch of the Chinese Institute of Electronics (܆
ༀҦஔʱึ ) in October 2021. He also serves as the party branch secretary of the Shenzhen Circuit
Board Industry Association (Бุ՘ึ ), secretary general (founding president) of the
Guangdong Circuit Board Industry Association (Бุ՘ึ ), and senior vice
chairperson of the council of the China Electronic Circuit Industry Association ( ʕ਷ཥɿཥ༩Бุ
՘ึ).
Dr. Xin previously served as the legal representative of Shenzhen Xiongxinsheng Electronics
C o . ,L t d .(ʮ̡ ), as the chairperson of the board of Dongguan Shengda Fu
Copper Plate Co., Ltd. (ʮ̡ ), as a director and legal representative of
Shenzhen Fangji Electronics Co., Ltd. (ʮ̡ ), and as a supervisor of
Shenzhen Taimo Print Circuit Information Co., Ltd. (ʮ̡ )
immediately before their respective deregistration or revocation. He confirmed that (i) the above
companies were solvent immediately prior to their deregistration or revocation; (ii) there was no
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wrongful act on his part leading to the deregistration or revocation of the above companies; and
(iii) he was not aware of any actual or potential claim that had been or would be made against him
as a result of such deregistration or revocation.
Ms. XIA Liya (ᘆඩ), aged 43, is an independent non-executive Director. She is primarily
responsible for supervising the Board as an independent party and safeguarding public interests
and the rights of minority Shareholders.
From July 2010 to July 2012, Ms. Xia served as a project coordinator under the department
of orthopaedics and traumatology in charge of project management at the Chinese University of
Hong Kong. Her other prior working experience also includes serving as a research assistant at the
Hong Kong Polytechnic University, and as a senior head of administration at Lingnan University
(ɽኪ). Currently, Ms. Xia serves as an assistant to director at Hong Kong University.
Ms. Xia obtained her bachelor’s degree in economics from Ningbo University (ɽኪ)i n
the PRC in June 2004. She then obtained her master’s degree in engineering business
administration from a joint program of the Hong Kong Polytechnic University in Hong Kong and
the University of Warwick in England in October 2010.
SENIOR MANAGEMENT
The following table sets forth certain information of the senior management of the Group:
Name Age Position
Principal roles and
responsibilities
Date of
joining our Group
Date of
appointment as
Senior Management
Relationship with
other Directors and
senior management
Mr. YANG Chaohui
(เಃሾ) ........
50 Chairperson of the Board,
executive Director and
general manager
Responsible for deciding
the Company’s daily
operational plans,
development, and
investment proposals;
convening and presiding
over Shareholder and
Board meetings; and
deciding and guiding the
external affairs, major
corporate matters, and
significant business
activities of the Company
May 2003 May 2003 None
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--- page 269 ---
Name Age Position
Principal roles and
responsibilities
Date of
joining our Group
Date of
appointment as
Senior Management
Relationship with
other Directors and
senior management
Mr. ZHOU Xiaodong
(؇)........
52 Deputy general manager,
financial director and
board secretary
Responsible for managing
the daily affairs of the
Company’s head
department of financial
management
November 2020 November 2020 None
Mr. ZHAI Xuetao
(ၱኪᏹ) ........
49 Deputy general manager Responsible for managing
the daily affairs of the
Company’s laser product
centre
March 2004 November 2020 None
Mr. LI Yongjun
(ࠏۇ)........
50 Deputy general manager Responsible for managing
the daily affairs of the
Company’s mechanical
product centre
October 2002 November 2020 None
Ms. KOU Lian
(੒๪) .........
50 Deputy general manager Responsible for managing
the daily affairs of the
Company’s supply chain
platform
October 2005 November 2020 None
Ms. SHE Rong
(ᠮႂ) .........
46 Deputy general manager Responsible for managing
the daily affairs of the
Company’s customer
value-added service
platform
January 2005 November 2020 None
Mr. SONG Jiangtao
(҂Ϫᏹ) ........
46 Deputy general manager Responsible for managing
the daily affairs of the
Company’s key account
customer management
platform
December 2003 April 2022 None
Mr. LYU Hongjie
(௫) ........
45 Deputy general manager Responsible for managing
the daily affairs of the
Company’s new laser
product centre
October 2006 April 2022 None
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Name Age Position
Principal roles and
responsibilities
Date of
joining our Group
Date of
appointment as
Senior Management
Relationship with
other Directors and
senior management
Mr. ZHANG Jianzhong
(ʕ) ........
48 Deputy general manager Responsible for managing
the daily affairs of the
Company’s small and
medium customer
management platform
March 2009 April 2022 None
Mr. YANG Chaohui ( เಃሾ) is the Chairperson of the Board, executive Director and
general manager of the Company, for the biographical details of Mr. Yang, see “Directors and
Senior Management — Directors.”
Mr. ZHOU Xiaodong (؇)aged 52, joined our Group in November 2020 and has
served as a deputy general manager, board secretary and the financial director of our Company
ever since. He is primarily responsible for managing the daily affairs of the Company’s head
department of financial management.
Mr. Zhou also currently holds other positions within various subsidiaries of our Group,
including as a supervisor of Xinfeng CNC since November 2022, as a director of Advanced
Intelligent Machine Co., Ltd. (ʮ̡ ) since April 2023 and as a director
of Rayleigh Taide since August 2022.
Mr. Zhou has also joined Han’s Laser Group since September 2002 as an accountant, and
served various positions thereof until October 2020, with his last position as the chief director of
Han’s Laser. Other than his commitments to our Group and Han’s Laser Group, Mr. Zhou also
served as an accountant at Wanjia Department Store Co., Ltd. (ʮ̡ ) from May 1999
to March 2002.
Mr. Zhou obtained his bachelor’s degree in financial accounting from Changchun University
of Science and Technology (ଣʈɽኪ ) in the PRC in July 1997.
Mr. ZHAI Xuetao ( ၱኪᏹ), aged 49, joined the Group in March 2004 and has been the
deputy general manager of our Company since November 2020. He is primarily responsible for
managing the daily affairs of the Company’s laser product centre.
Mr. Zhai has over 20 years of experience in the specialized PCB equipment industry. From
March 2004 to November 2020, Mr. Zhai served successively as the design engineer, department
manager, director of laser product center and the person-in-charge of the product platform of the
Company. From October 2014 to November 2020, he also served as a supervisor of the Company.
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Mr. Zhai obtained his bachelor’s degree from Liaoning Petrochemical University (ʷ
ʈɽኪ, formerly known as Fushun Petroleum Institute (ኪ৫ )) in the PRC in July 2000.
He further obtained his master’s degree in electronics and communication engineering from Harbin
Institute of Technology (ဧᏵʈุɽኪ ) in the PRC in January 2009. He has received various
awards before, including National Torch Program Project Award (ྌධͦᆤ )b yt h e
Ministry of Science and Technology of the PRC (ኪҦஔ௅ ) in December 2007,
the Shenzhen Science and Technology Innovation Award (Ҧ௴อᆤ ) by the People’s
Government of Shenzhen (ִ݁in December 2010, the Shenzhen Science and
Technology Progress First Award (ҦආӉɓഃᆤ ) by the People’s Government of
Shenzhen in September 2013, the Shenzhen Science and Technology Progress Second Award ( ଉέ
ҦආӉɚഃᆤ ) by the People’s Government of Shenzhen in December 2020, and the
Guangdong Provincial Science and Technology Progress Second Award (ҦආӉɚഃᆤ )
by the People’s Government of Guangdong Province (ִ݁in March 2021.
Mr. LI Yongjun (ࠏۇ)aged 50, joined the Group in October 2002 and has been the
deputy general manager of our Company since November 2020. He is primarily responsible for
managing the daily affairs of the Company’s mechanical product centre.
Mr. Li has extensive experience in the design, research and development of PCB mechanic
drilling equipment. From October 2002 to February 2007, Mr. Li served successively as the design
engineer and department manager of the R&D department of our Company. From August 2008 to
November 2020, Mr. Li also served successively as a deputy chief engineer and the director of the
mechanical product centre of our Company.
Mr. Li obtained his bachelor’s degree in engineering from Hunan University (ɽኪ)i n
the PRC in June 1999. He further obtained his master’s degree in engineering degree from Harbin
Institute of Technology (ဧᏵʈุɽኪ ) in the PRC in July 2009. He also received various
awards during his career, including the 2012 Shenzhen Science and Technology Progress First
Award (ҦආӉɓഃᆤ ) by the People’s Government of Shenzhen in July 2013 and
Guangdong Provincial Science and Technology Progress First Award (ҦආӉɓഃᆤ )b y
the People’s Government of Guangdong Province in May 2023. He also worked part-time at
Guangdong Higher V ocational Education Mechanical Manufacturing Professional Teaching
Steering Committee (ึ ) from July 2015 to June
2019.
Ms. KOU Lian ( ੒๪), aged 50, joined the Group in October 2005 and has been the deputy
general manager of our Company since November 2020. She is primarily responsible for managing
the daily affairs of the Company’s supply chain platform.
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From February 2001 to October 2005, Ms. Kou served successively as an assistant and
manager of Han’s Laser. She served successively as a director of the production and operation
center and the person-in-charge of the supply chain and delivery platform of our Company, and
also as a supervisor of our Company from October 2014 to November 2020. Since November
2022, she has also served an executive director and the general manager of Xinfeng CNC.
Ms. Kou obtained her master of business administration (MBA) degree from Hong Kong
Baptist University (ಥऍึɽኪ ) in Hong Kong in October 2010.
Ms. SHE Rong ( ᠮႂ), aged 46, joined the Group in January 2005 and has been the deputy
general manager of our Company since November 2020. She is primarily responsible for managing
the daily affairs of the Company’s customer value-added service platform.
From January 2005 to November 2020, Ms. She successively served as a department
manager, a director of the customer value-added service center, and the person in charge of the
customer value-added service platform of our Company.
Ms. She obtained her bachelor’s degree in law from Nanchang (ɽኪ) in the PRC in July
2000. She further obtained her EMBA degree from Jilin University (ɽኪ) in the PRC in
December 2017.
Mr. SONG Jiangtao ( ҂Ϫᏹ), aged 46, joined the Group in December 2003 and has been
the deputy general manager of our Company since April 2022. He is primarily responsible for
managing the daily affairs of the Company’s key account customer management platform.
Mr. Song has extensive experience in sales. He served successively as a senior market
manager and a director of the South China key account sales department of the Company from
December 2003 to November 2019. Since December 2019, he has served as the executive deputy
general manager of key account department of our Company.
Mr. LYU Hongjie (௫), aged 45, joined the Group in October 2006 and has been the
deputy general manager of our Company since April 2022. He is primarily responsible for
managing the daily affairs of the Company’s new laser product centre.
Mr. Lyu served successively as a product manager in the laser cutting machine product
department and the product director of laser cutting machine product center of the Company from
October 2006 to December 2018. Mr. Lyu has served successively as the deputy general manager
and the product general manager of the new laser product center of our Company since January
2019. He currently also serves as the standing deputy general manager of Han’s Microelectronics,
where he is directly responsible for the overall management of the product platform thereof.
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Mr. Lyu obtained his bachelor’s degree in engineering from Hebei University (̏ɽኪ)i n
the PRC in June 2003.
Mr. ZHANG Jianzhong (ʕ), aged 48, joined the Group in March 2009 has been the
deputy general manager of our Company since April 2022. Since May 2014, Mr. Zhang has also
served as the person-in-charge of the Company’s small and medium customer management
platform, and is currently primarily responsible for the management of the daily affairs thereof.
Mr. Zhang served as the sales director at Shenzhen Maixun Electronics Co., Ltd ( ଉέ௥Ⴥཥ
ʮ̡ ), a subsidiary of the Company, from March 2009 to May 2014. Currently, he has also
served as a director of Shanghai Han’s Machinery Co., Ltd. (ʮ̡ ), a subsidiary
of the Company, since February 2023.
Mr. Zhang graduated from Henan Institute of Science and Technology (Ҧኪ৫ )i nt h e
PRC in July 2018.
FURTHER INFORMATION ABOUT MR. ZHOU HUIQIANG AND MR. QIU YUNLIANG
After the original net profit figures of Han’s Laser for the financial year of 2009 was
disclosed, a further announcement was made to revise the net profit for the financial year of 2009
according to the advice of the auditor. As Mr. Zhou was the finance director of Han’s Laser, he,
together with the other relevant personnel, subsequently received a notice of criticism issued by
the Shenzhen Stock Exchange in 2010 (the “ Notice ”). According to the Notice, Mr. Zhou was not
named to be involved in any personal wrongdoing, fraudulent or dishonest conduct. No other
penalties were imposed on Mr. Zhou from the incident. The incident was unrelated to our Group
and Mr. Zhou’s role as our non-executive Director.
Mr. Qiu has received certain warnings and notice from the regulatory authorities for the
following matters (the “ Warnings ”):
(a) Mr. Qiu acted as the signing auditor for Shenzhen Dvision Co., Ltd. (΅
ʮ̡) (a company listed on the Shenzhen Stock Exchange, stock code: 300167)
(“Shenzhen Dvision ”) for the financial year ended December 31, 2010. Because of
subsequent revision the net profit figures arising from inadequate audit procedures, Mr.
Qiu, as the signing auditor, received a notice of criticism in 2015 for his failure to
exercise due diligence and supervision over the audit procedures;
DIRECTORS AND SENIOR MANAGEMENT
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(b) Mr. Qiu was the signing auditor for Shenzhen Liantronics Co., Ltd. (ٰ
ʮ̡ ) (a company listed on the Shenzhen Stock Exchange, stock code: 300269)
(“Shenzhen Liantronics ”) from 2014 to 2016. In 2019, Mr. Qiu received a warning
letter from the Shenzhen Regulatory Bureau of the CSRC, primarily because inadequate
audit procedures had been put in place for the audit of the annual financial statements of
Shenzhen Liantronics; and
(c) Mr. Qiu was an independent director and the chairperson of the audit committee of
Chipsea Technologies (Shenzhen) Corp., Ltd. (Ҧ(ଉέ)ʮ̡ )( a
company listed on the Shanghai Stock Exchange, stock code: 688595) (“ Chipsea
Technologies ”) from June 2019 to April 2025. In 2023, Mr. Qiu received a regulatory
warning from the Shanghai Stock Exchange for his inadequate due diligence and
supervision over discrepancies between the performance forecast for the year ended
December 31, 2022 and the audited financial results for the year ended December 31,
2022, following adjustments made by the external auditors in relation to expense
recording. Following the incident, Mr. Qiu, as the then independent director and
chairperson of the audit committee of Chipsea Technologies, had actively reviewed and
discussed the discrepancies with management and external auditors, sought clarification
regarding the basis for audit adjustments, and led the preparation of the issuance of the
clarification announcement. He also ensured that the audit committee fulfilled its
supervisory responsibilities in accordance with applicable laws and regulations
following the incident. Furthermore, Mr. Qiu promoted the implementation of
rectification measures following the incident, including enhancing transparency and
compliance with accounting standards through targeted training within Chipsea
Technologies, strengthening internal policies, and ensuring that the audit committee’s
recommendations were properly documented and communicated to the board of Chipsea
Technologies.
However, Mr. Qiu was not named in the Warnings as being involved in any fraudulent or
dishonest conduct. No other penalties were imposed on Mr. Qiu in relation to the above incident,
and his practising qualification as a certified public accountant in the PRC was not affected by the
notice of criticism. The above incident was unrelated to our Group and Mr. Qiu’s role as our
independent non-executive Director or the chairperson of the Audit Committee.
DIRECTORS AND SENIOR MANAGEMENT
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Despite the receipt of the Warnings and Notice, after conducting a comprehensive assessment
(including understanding the nature of the underlying incidents leading to the Warnings and
Notice), our Company and the Directors (excluding Mr. Zhou and Mr. Qiu) believe that the
Warnings and Notice did not adversely affect Mr. Zhou’s suitability to act as a non-executive
Director and Mr. Qiu’s suitability to act as an independent non-executive Director and the
chairperson of the Audit Committee, and Mr. Zhou and Mr. Qiu possess the experience,
knowledge, and skills required to serve as a director of a listed company. Therefore, according to
Listing Rules 3.08 and 3.09, after considering the following reasons, each of Mr. Zhou and Mr.
Qiu is suitable to serve as a Director and Mr. Qiu has the requisite expertise under Rule 3.10(2) of
the Listing Rules to act as the chairperson of the Audit Committee:
(i) According to the PRC Company Law and the rules of the Shenzhen Stock Exchange and
the Shanghai Stock Exchange, the Warnings and Notice are not administrative penalties
against Mr. Zhou and Mr. Qiu and did not disqualify Mr. Zhou and Mr. Qiu from acting
as a director or an independent director of any PRC incorporated company;
(ii) Mr. Zhou and Mr. Qiu received the Warnings and Notice because they were the directors
and, in Mr. Qiu’s case, the auditor of the relevant companies at the material time. The
Warnings and Notice did not mention any fraudulent or dishonest conduct by Mr. Zhou
or Mr. Qiu;
(iii) As disclosed in Mr. Zhou’s and Mr. Qiu’s biographies above, Mr. Zhou and Mr. Qiu
have accumulated extensive experience in board affairs of listed companies in the PRC.
Mr. Zhou is a certified public accountant in the PRC. Mr. Qiu is certified public
accountant in the PRC and a visiting professor at a university, with deep knowledge in
the field of audit and accounting. To the best of our knowledge after making all
reasonable inquiries, apart from the Warnings and Notice mentioned above, neither Mr.
Zhou nor Mr. Qiu has any other non-compliance records or otherwise subject to any
inquiries, investigations and proceedings by regulatory authorities and other
governmental agencies during their tenures as a director of our Company or any other
listed company;
(iv) Despite the receipt of the Warnings and Notice, each of Mr. Zhou and Mr. Qiu has been
serving on the board of directors of certain PRC listed company(ies) thereafter,
demonstrating Mr. Zhou’s and Mr. Qiu’s value to these companies, as well as their
abilities to fulfill their duties under the directorships they hold in our Company. With
respect to Mr. Qiu, (i) Mr. Qiu is a certified public accountant in the PRC and has the
appropriate professional qualifications satisfying the requirement under Rule 3.10 of the
Listing Rules; (ii) Mr. Qiu has been the independent director and/or the audit committee
member for four listed companies and has accumulated the knowledge and experience in
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serving audit committees of listed companies. Particularly notable that, following the
Warnings, Mr. Qiu was still appointed and has served as an independent director and a
member of audit committee of Chanyuan Technology Group Co., Ltd. (ٰ
ʮ̡ ), a company listed on the Shanghai Stock Exchange (stock code: 600525)
since November 2024. See Mr. Qiu’s biography in “Directors and Senior Management
Directors” for details; (iii) Mr. Qiu is also currently and has been appointed a visiting
professor of the School of Accounting of Jiangxi University of Finance and Economics
(ϪГৌ຾ɽኪ ) since November 2024; (iv) Mr. Qiu is a research scholar in the field of
accounting receiving industry recognition, his academic research on the topic of equity
incentives received the Second Prize of Accounting Academic Projects in 2023 issued by
of Shenzhen Accounting Society (ኪึ ) in the PRC; and (v) Mr. Qiu has
continued with professional development and received trainings as a certified public
accountant in the PRC following the Warnings, further updating Mr. Qiu’s professional
knowledge and regulatory awareness, enhancing his ability to supervise and ensure
compliance as well as demonstrating his expertise to act as a chairperson of the Audit
Committee under Rule 3.10(2) of the Listing Rules;
(v) Mr. Zhou and Mr. Qiu have participated in relevant trainings to keep up with the latest
regulatory developments, including training programmes, attending seminars and
workshops led by industry professionals, and regularly reviewing up-to-date reading
materials such as regulatory bulletins, guidance notes, legal commentaries, and industry
publications delivered by the Company to the Directors and senior management from
time to time covering topics such as corporate governance, directors’ responsibilities,
continuous obligations of listed companies under the Listing Rules and the
consequences of violating the Listing Rules and Hong Kong laws. In particular, Mr. Qiu
has completed follow-up trainings for independent directors of listed companies
following the relevant incidents, and has fully learned the professional skills and
corresponding responsibilities required for independent directors of listed companies;
(vi) We have also implemented internal control measures to ensure full compliance with
applicable laws and regulations in the future, including but not limited to appointing the
compliance adviser and enhancing the information disclosure policies. We have
established a comprehensive information disclosure management system which will
become effective upon listing. This system will monitor and manage our information
disclosure activities to prevent similar incidents happening to our Company. It includes
a clear review process to ensure the accuracy and truthfulness of disclosures, involving
coordinated reviews by multiple departments (such as the Board Office, legal
department, finance department and relevant business units and functional departments),
including the secretary to the Board. In addition, when reviewing the disclosure on
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certain transactions, Directors, including independent non-executive Directors may seek
independent professional advice at the cost of our Company to assist in reviewing and
evaluating the relevant transactions; and
(vii) Our Company and the Directors will ensure compliance with all applicable laws and
regulations, including but not limited to the Listing Rules, by timely consulting the
compliance adviser and seeking independent legal advice when necessary (especially
before entering into any transaction or corporate action subject to Chapter 14 and
Chapter 14A of the Listing Rules).
Based on the independent due diligence conducted by the Sole Sponsor, nothing has come to
the attention of the Sole Sponsor which casts reasonable doubt on the above view of the Company
and the Directors (excluding Mr. Zhou and Mr. Qiu) that the Warnings and Notice did not
adversely affect Mr. Zhou’s suitability to act as a non-executive Director and Mr. Qiu’s suitability
to act as an independent non-executive Director and the chairperson of the Audit Committee,
respectively, and Mr. Zhou and Mr. Qiu possess the experience, knowledge, and skills required to
serve as a director of a listed company.
COMPANY SECRETARIES
Ms. ZHOU Yuanyuan ( մᎯᎯ), has been appointed as our joint company secretary since
April 2025.
Ms. Zhou joined our Company in March 2021, and served as a securities affairs
commissioner until December 2021. She has served as securities affairs representative since
January 2022. From June 2014 to February 2021, Ms. Zhou served as an accountant at Han’s
Laser.
Ms. Zhou obtained the bachelor’s degree in accounting from Tianjin University of Commerce
(ਠุɽኪ ) in July 2011. Ms. Zhou obtained intermediate accounting qualification (ࠇ
ᔖ၈) by Guangdong Provincial Department of Human Resources and Social Security on January
2017.
Ms. WONG Nga Sim ( රඩᄬ), has been appointed as our joint company secretary since
April 2025.
Ms. Wong has over 8 years of experience in the corporate secretarial field. She currently
serves as the manager of Company Secretarial Services of Tricor Services Limited (a member of
Vistra Group). She has been providing professional corporate services to Hong Kong listed
companies as well as multinational, private and offshore companies.
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Ms. Wong obtained a bachelor’s degree in business administration (hons.) from Hong Kong
Baptist University in 2015. She is a Chartered Secretary, a Chartered Governance Professional and
an associate of both The Hong Kong Chartered Governance Institute and The Chartered
Governance Institute in the United Kingdom.
CONFIRMATION FROM OUR DIRECTORS
Rule 3.09D of the Listing Rules
Each of our Directors confirms that he or she (i) has obtained the legal advice referred to
under Rule 3.09D of the Listing Rules in May 2025, 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 or her independence as
regards each of the factors referred to in Rules 3.13(1) to (8) of the Listing Rules, (ii) he or she
has no past or present financial or other interest in the business of the Company or its subsidiaries
or any connection with any core connected person of the Company under the Listing Rules as of
the Latest Practicable Date, and (iii) that there are no other factors that may affect his or her
independence at the time of his/her appointments.
Rule 8.10 of the Listing Rules
Each of our Directors confirms that as of the Latest Practicable Date, he or she did not have
any interest in a business which competes or is likely to compete, either directly or indirectly, with
our Company’s business which would require disclosure under Rule 8.10 of the Listing Rules.
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MANAGEMENT AND CORPORATE GOVERNANCE
Board Committees
We have established four Board Committees in accordance with the relevant laws and
regulations in the PRC, the Articles, and the code of corporate governance practices under the
Listing Rules, namely the Audit Committee, the Remuneration and Appraisal Committee, the
Nomination Committee and the Strategy Committee. The functions of the four committees are
summarized as follows:
Audit Committee
We have established the Audit Committee with written terms of reference in compliance with
Rule 3.21 of the Listing Rules and the Corporate Governance Code set out in Appendix C1 to the
Listing Rules. The primary duties of the Audit Committee are to review and supervise the financial
reporting process and internal controls system of our Group, review and approve connected
transactions, and provide advice and comments to the Board. The Audit Committee comprises
three members, namely Mr. QIU Yunliang, Mr. ZHOU Huiqiang and Ms. LI Weiwei, with Mr. QIU
Yunliang as the chairperson of the Audit Committee and is the director appropriately qualified as
required under Rules 3.10(2) and 3.21 of the Listing Rules.
Remuneration and Appraisal Committee
We have established the Remuneration and Appraisal Committee with written terms of
reference in compliance with Rule 3.25 of the Listing Rules and the Corporate Governance Code
set out in Appendix C1 to the Listing Rules. The primary duties of the Remuneration and
Evaluation Committee are to review and make recommendations to the Board on the terms of
remuneration packages, bonuses, and other compensation payable to our Directors and other senior
management. The Remuneration and Appraisal Committee comprises three members, namely Dr.
XIN Guosheng, Mr. ZHOU Huiqiang and Mr. QIU Yunliang, with Dr. XIN Guosheng as the
chairperson of the Remuneration and Appraisal Committee.
Nomination Committee
We have established a Nomination Committee with written terms of reference in compliance
with the Code on Corporate Governance in Appendix C1 to the Listing Rules. The primary duties
of the Nomination Committee are to make recommendations to our Board on the appointment of
Directors and management of Board succession. The Nomination Committee comprises three
members, namely Ms. LI Weiwei, Dr. XIN Guosheng and Mr. DU Yonggang, with Ms. LI Weiwei
as the chairperson of the Nomination Committee.
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Strategy Committee
We have established a Strategy Committee with written terms of reference. The primary
duties of the Strategy Committee are to make recommendations to our Board on the long-term
development strategy and major investments and projects of our Company. The Strategy
Committee comprises three members, namely Mr. YANG Chaohui, Mr. ZHANG Jianqun and Mr.
QIU Yunliang, with Mr. YANG Chaohui as the chairperson of the Strategy Committee.
Corporate Governance Code
We aim to implement a high standard of corporate governance, which we believe is crucial to
safeguard the interests of our Shareholders. To accomplish this, we expect to comply with the
Corporate Governance Code set out in Appendix C1 of the Listing Rules after the Listing, save for
the deviation from provision C.2.1 of Part 2 of the Corporate Governance Code that Mr. YANG
Chaohui will serve as both our chairperson of the Board and general manager as discussed below.
Pursuant to code provision C.2.1 of Part 2 of the Corporate Governance Code, companies
listed on the Stock Exchange are expected to comply with, but may choose to deviate from the
requirement that the responsibilities between the chairperson and the chief executive should be
segregated and should not be performed by the same individual. We do not have a separate
chairperson and chief executive, and Mr. Yang currently performs these two roles. The Board
believes that vesting the roles of both chairperson and chief executive in the same person has the
benefit of ensuring consistent leadership within our Group and enables more effective and efficient
overall strategic planning for our Group. The Board considers that the balance of power and
authority for the present arrangement will not be impaired, and this structure will enable our
Company to make and implement decisions promptly and effectively. The Board will continue to
review and consider splitting the roles of chairperson of the Board and the general manager of our
Company if and when it is appropriate taking into account the circumstances of our Group as a
whole.
Board Diversity
Our Company has adopted a board diversity policy which sets out the approach to achieve
diversity of the Board. Our Company recognizes and embraces the benefits of having a diverse
Board and sees increasing diversity at the Board level, including gender diversity, as an essential
element in maintaining our Company’s competitive advantage and enhancing our ability to attract,
retain, and motivate employees from the widest possible pool of available talent. Pursuant to the
board diversity policy, in reviewing and assessing suitable candidates to serve as a director of our
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Company, the Nomination Committee will consider a number of aspects, including but not limited
to gender, age, cultural and educational background, professional qualifications, skills, knowledge,
and industry and regional experience.
In particular, our Company currently has three female Directors on the Board and will
continue to work towards enhancing the gender diversity of the Board. Our Directors have a
balanced mix of knowledge and skills, and we have four independent non-executive Directors,
with different industry backgrounds. Taking into account our existing business model and specific
needs as well as the different background of our Directors, the composition of our Board satisfies
our board diversity policy. Pursuant to the board diversity policy, the Nomination Committee will
discuss periodically and, when necessary, agree on the measurable objectives for achieving
diversity, including gender diversity, on the Board and recommend them to the Board for formal
adoption.
Management Presence
Pursuant to Rules 8.12 and 19A.15 of the Listing Rules, an issuer must have a sufficient
management presence in Hong Kong. This will normally mean that at least two of its executive
directors must be ordinarily resident in Hong Kong. We do not have sufficient management
presence in Hong Kong for the purposes of Rules 8.12 and 19A.15 of the Listing Rules.
Accordingly, we have applied for, and the Stock Exchange has granted, a waiver from strict
compliance with Rules 8.12 and 19A.15 of the Listing Rules. See “Waivers from Strict
Compliance with the Listing Rules and Exemptions from the Companies (Winding Up And
Miscellaneous Provisions) Ordinance” in this Prospectus for further details.
REMUNERATION
Our Directors, former supervisors of the Company (the “ Supervisors ”) and senior
management receive their remuneration in the form of basic annual payments and
performance-related annual payments, including fees, salaries, allowances and benefits in kind,
performance related bonuses, share-based payment compensation and pension scheme
contributions.
For each of the years ended December 31, 2022, 2023 and 2024 and the ten months ended
October 31, 2025, the total remuneration paid to our Directors and Supervisors amounted to
RMB3.0 million, RMB5.9 million, RMB41.6 million and RMB23.4 million, respectively.
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For each of the years ended December 31, 2022, 2023 and 2024 and the ten months ended
October 31, 2025, there were one, one, one and one Director among the five highest paid
individuals, respectively. The total remuneration paid to the remaining individuals among the five
highest paid individuals for each of the years ended December 31, 2022, 2023 and 2024 and the
ten months ended October 31, 2025 amounted to RMB7.2 million, RMB7.5 million, RMB18.7
million and RMB10.2 million, respectively.
During the Track Record Period, no payment was made by us to any of our Directors,
Supervisors or the five highest-paid individuals as an inducement to join or upon joining our
Company. During the Track Record Period, no compensation was paid to, or receivable by, any
Director, former Director, Supervisor, former Supervisor or any of the five highest-paid individuals
for the loss of office as a director of any member of our Group or for the loss of any other office
in connection with the management of the affairs of any member of our Group. Save as disclosed
above, there was no other payments paid or payable by our Company or any of our subsidiaries to
our Directors, Supervisors or the five highest-paid individuals during the Track Record Period.
The remuneration of our Directors, Supervisors and senior management is determined with
reference to their responsibilities, qualifications, position and seniority. Under the arrangement
currently in force, the aggregate amounts of remuneration payable by our Company to our
Directors and Supervisors for the year ending December 31, 2025 will be approximately RMB27.9
million. The actual remuneration of Directors and Supervisors in 2025 may be different from the
expected remuneration.
COMPLIANCE ADVISOR
We have appointed Somerley Capital Limited as our compliance advisor pursuant to Rule
3A.19 of the Listing Rules. The compliance advisor will provide us with guidance and advice
regarding compliance with the requirements under the Listing Rules and applicable Hong Kong
laws. Pursuant to Rule 3A.23 of the Listing Rules, the compliance advisor will advise our
Company, among others, in the following circumstances:
(a) before the publication of any regulatory announcement, circular, or financial report;
(b) where a transaction, which might be a notifiable or connected transaction, is
contemplated, including share issues, sales or transfers of treasury shares and share
repurchases;
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(c) where we propose to use the proceeds of the Global Offering in a manner different from
that detailed in this Prospectus or where the business activities, development, or results
of our Group deviate from any forecast, estimate, or other information in this
Prospectus; and
(d) where the Hong Kong Stock Exchange makes an inquiry to our Company regarding
unusual movements in the price or trading volume of our listed securities or any other
matters in accordance with Rule 13.10 of the Listing Rules.
The term of appointment of the compliance advisor shall commence on the Listing Date and
is expected to end on the date on which our Company complies with Rule 13.46 of the Listing
Rules in respect of our financial results for the first full financial year commencing after the
Listing Date, and such appointment may be subject to extension by mutual agreement.
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OUR CONTROLLING SHAREHOLDERS GROUP
As of the Latest Practicable Date, Mr. Gao was interested in approximately 84.39% of the
total issued share capital of our Company through (i) Han’s Laser as to approximately 83.63% and
(ii) Dazu Holdings as to approximately 0.76%. Han’s Laser is a company listed on the Shenzhen
Stock Exchange (stock code: 002008) and a consolidated subsidiary of Dazu Holdings. As of the
Latest Practicable Date, Han’s Laser was a consolidated subsidiary of Dazu Holdings on the basis
that (i) despite Mr. Gao, directly and indirectly through Dazu Holdings, holding only 25.07% of
the equity interest in Han’s Laser, Mr. Gao (himself and through Dazu Holdings) was the largest
shareholder of Han’s Laser, and (ii) Dazu Holdings controlled the board of directors of Han’s
Laser as the board of directors of Han’s Laser comprised 12 directors, 10 of whom were nominated
by Dazu Holdings. As of the Latest Practicable Date, (i) Han’s Laser was held by Dazu Holdings,
Mr. Gao and other A shareholders as to 15.71%, 9.36% and 74.93%, respectively, and (ii) Dazu
Holdings was directly held as to 99.875% by Mr. Gao, and as to 0.125% by Han’s Global, which
was in turn wholly and beneficially owned by Mr. Gao. As such, Mr. Gao, Han’s Laser, Dazu
Holdings and Han’s Global constitute the Controlling Shareholders Group of our Company.
Immediately following the completion of the Global Offering (assuming the Over-allotment
Option is not exercised and no other changes are made to the issued share capital of our Company
between the Latest Practicable Date and the Global Offering), the Controlling Shareholders Group
will hold in aggregate approximately 75.45% of the issued share capital of our Company.
Therefore, they will remain as the Controlling Shareholders Group upon completion of the Global
Offering.
INDEPENDENCE FROM OUR CONTROLLING SHAREHOLDERS GROUP
Non-compete Undertakings
In order to avoid competition between the Controlling Shareholders Group and their
respective controlled corporations (other than our Group) (the “ Related Parties ”) and our
Company, each of Mr. Gao, Dazu Holdings and Han’s Laser executed a non-competition
undertaking on May 11, 2021 (the “ CS Non-Competition Undertakings ”) to undertake that:
(a) During the period in which each of Mr. Gao, Dazu Holdings and Han’s Laser is a
member of our Controlling Shareholders Group, our Group shall be designated as the
exclusive platform for the R&D, production, and sales of specialized PCB production
equipment;
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(b) During the period in which each of Mr. Gao, Dazu Holdings and Han’s Laser is a
member of our Controlling Shareholders Group, each of Mr. Gao, Dazu Holdings and
Han’s Laser will make all reasonable efforts to ensure that the Related Parties do not
engage in any business that constitutes material adverse competition with the principal
business of our Group;
(c) Each of Mr. Gao, Dazu Holdings and Han’s Laser will supervise and restrain the
business activities of the Related Parties. In the case that each of Mr. Gao, Dazu
Holdings, Han’s Laser and/or the Related Parties obtain any business opportunity from
any third party that constitutes material adverse competition with the principal business
of our Group, each of Mr. Gao, Dazu Holdings, Han’s Laser and/or the Related Parties
shall immediately notify our Company and endeavor to enable our Group to obtain such
business opportunity. In the case that any of Mr. Gao, Dazu Holdings, Han’s Laser
and/or the Related Parties engage in principal businesses that constitute material adverse
competition with our Group, it/he shall immediately inform our Company in writing
upon becoming aware of the situation and, take all reasonable measures to avoid and
resolve such competition, including but not limited to our Company’s being entitled to
request each of Mr. Gao, Dazu Holdings and Han’s Laser to coordinate and resolve the
matter through our Company’s acquisition such competing business within a reasonable
period or sale of such competing business by any of Mr. Gao, Dazu Holdings, Han’s
Laser and/or Related Parties or other measures as appropriate;
(d) Each of Mr. Gao, Dazu Holdings and Han’s Laser will not take advantage of its position
to engage in or participate in any actions that harm the interests of our Company and the
other Shareholders (including in particular, the minority Shareholders), and will not use
any information obtained from our Group to assist any third party in conducting
business activities that constitute material adverse competition with the principal
business of our Group; and
(e) If, during the course of its implementation, any of Mr. Gao, Dazu Holdings and Han’s
Laser violates any of the above undertakings, it/he shall compensate our Group with all
benefits and profits obtained from the relevant transactions, and where such violation
causes any economic losses to our Group, it/he shall be held liable for the relevant
compensation in accordance with the relevant legal requirements.
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Our Company also executed a non-competition undertaking on May 11, 2021 (together with
the CS Non-Competition Undertakings, the “ Non-Competition Undertakings ”) to undertake that:
(a) our Company shall continue to engage in the business of the R&D, production, and,
sales of specialized PCB production equipment following the listing of its A shares on
the Shenzhen Stock Exchange; and
(b) our Company shall not engage in any competing business which constitutes material
adverse effect to Han’s Laser and its controlled corporations.
Business Delineation
Our Group’s business can be clearly delineated from the business of the Controlling
Shareholders Group, as our principal business is different from those of the Controlling
Shareholders Group.
As a result of the Non-Competition Undertakings, during the period in which each of Mr.
Gao, Dazu Holdings and Han’s Laser is a member of our Controlling Shareholders Group, (i) our
Group shall be designated as the exclusive platform for the R&D, production, and sales of
specialized PCB production equipment for our Controlling Shareholders Group; and (ii) each of
Mr. Gao, Dazu Holdings and Han’s Laser will make all reasonable efforts to ensure that the
Related Parties do not engage in any business that constitutes material adverse competition with
the principal business of our Group.
On the other hand, Han’s Laser, Dazu Holdings and Han’s Global are engaged in businesses
in areas which do not constitute material adverse competition with the principal business of our
Group, i.e., PCB production equipment related businesses, in particular:
(a) Han’s Laser is listed on the Shenzhen Stock Exchange (stock code: 002008) and
specializes in the R&D, production, and sales of intelligent manufacturing equipment
and its key components. Han’s Laser is engaged in the production of intelligent
manufacturing equipment and its components, which have a much broader and more
general range of applications, with its products mainly comprise four categories: (i)
non-PCB-specific components and industry-standard products such as ultraviolet and
ultrafast lasers, high-power fibre lasers, medium- and low-power CO
2 lasers, pulsed
fibre lasers, and general motion control systems, (ii) customized non-PCB equipment
and products based on client’s specific needs such as specialized laser marking
equipment and laser welding equipment for consumer electronics equipment, production
and processing equipment for lithium battery cells and modules, photovoltaic equipment
used in the photovoltaic cell and module segments, (iii) semiconductor equipment, such
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as laser dicing and full-cut equipment, laser internal modification cutting equipment for
front-end wafer processing; and (iv) advanced laser-related manufacturing products such
as standard laser cutting, welding, and marking equipment, general-purpose laser
processing equipment. In particular, the intended applications and usage scenarios of
Han’s Laser’s products serve broad industrial purposes such as laser marking, cutting,
welding, scribing, and cleaning across multiple sectors including automotive, consumer
electronics, photovoltaics, and semiconductors, rather than PCB-specific manufacturing
processes. The applications and core functions of these equipment differ significantly
from the specialized PCB manufacturing equipment that the Group focuses on.
In contrast, our Group, as the dedicated PCB specialized equipment business unit of
Han’s Laser, focuses exclusively on the research, development, production, and sales of
specialized equipment for PCB manufacturing processes, including key procedures such
as drilling, pattern transfer, and quality inspection. The vast majority of equipment used
in PCB manufacturing processes is specialized equipment which Han’s Laser does not
produce.
Therefore, there is no functional overlap between the products manufactured by the
Group and those produced by Han’s Laser, and there is no direct competition between
our Group and Han’s Laser.
However, due to the highly versatile and cross-industry nature of certain equipment
produced by Han’s Laser, there is a small overlap in their customer base. For example,
Han’s Laser’s general-purpose processing equipment, such as laser marking machines,
can be used for processing a variety of materials including plastics, paper, and stone, as
well as for marking QR codes on PCB surfaces. As a result, Han’s Laser also sells such
equipment to companies in the PCB industry. For further details of overlapping
customers, see below “— Operational Independence”;
(b) Dazu Holdings was founded in 1996 and, as of the Latest Practicable Date, had a
registered capital of RMB800 million. Dazu Holdings is a holding company of more
than 60 subsidiaries with more than 18,000 employees operating across a wide range of
sectors, including but not limited to, equipment manufacturing through Han’s Laser as
described in sub-paragraph (a), new energy, real estate development (both industrial and
residential), hotel operations, property management, and several other sectors; and
(c) Han’s Global is a subsidiary of Dazu Holdings, located in the Beijing Yizhuang National
High-Tech Economic and Technological Development Zone (ॴ৷อ຾᏶
Ҧஔක೯ਜ ), with a registered capital of RMB400 million. Han’s Global manages two
main asset projects with a total area of 530,000 square metres: the Dazu Enterprise Bay
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Project ( ɽૄΆุᝄධͦ ) which primarily focuses on leasing factories and R&D
buildings, while the Dazu Plaza Project ( ɽૄᄿఙධͦ ) which specialises in leasing
commercial and office space. In addition, Han’s Global has a subsidiary, Han’s Qihang
(Beijing) Technology Innovation Co., Ltd. ( ɽૄ઼ঘ(̏ԯ)ʮ̡ ), which
is principally engaged in technical consulting and technical services.
As such, our Group is specialized as a solution provider for PCB production equipment of
our Controlling Shareholders Group and our Controlling Shareholders Group do not involve in the
business of of PCB production equipment. For further details of the business model and products
and solutions offered by our Group, see the section headed “Business — Our Products.”
Management Independence
Our Board consists of nine Directors, including one executive Director, four non-executive
Directors and four independent non-executive Directors, of which three non-executive Directors,
namely, Mr. ZHANG Jianqun (໊)( “ Mr. Zhang ”), Mr. ZHOU Huiqiang ( մሾ੶)( “ Mr.
Zhou”) and Mr. DU Yonggang (࡝“() Mr. Du ”), also hold positions in Han’s Laser, including
Mr. Zhang as the deputy chairperson of the board and an executive deputy director of the
management and decision committee of Han’s Laser, Mr. Zhou as a director, an executive deputy
director of the management and decision committee and the financial director of Han’s Laser, and
Mr. Du as the board secretary and deputy director of the management and decision committee of
Han’s Laser. Save as disclosed above, none of our Directors or members of our senior management
team holds any position in any member of the Controlling Shareholders Group or their respective
close associates.
Our Directors consider that we are capable of maintaining management independence for the
following reasons:
(a) each of Mr. Zhang, Mr. Zhou and Mr. Du is a non-executive Director and is not
involved in our day-to-day operation, while our daily management and operations are
carried out independently by our senior management team (one of which is our
executive Director), all of whom have substantial experience in the industry in which
our Company is engaged, and will therefore be able to make business decisions that are
in the best interests of our Company. For details of the industry experience of our senior
management team, please refer to the section headed “Directors and Senior
Management” in this Prospectus;
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(b) each Director is aware of his/her fiduciary duties as a director which require, among
other things, that he/she acts for the benefit and in the interest of our Company and does
not allow any conflict between his/her duties as a Director and his/her personal
interests;
(c) in the event that there is a potential conflict of interest arising out of any transaction to
be entered into between our Company and a Director and/or his/her associate, he/she
shall abstain from voting and shall not be counted towards the quorum for the voting.
Hence, no Director will be able to influence our Board in making decisions on matters
in which he or she is, or may be interested;
(d) we have four independent non-executive Directors, comprising more than one-third of
the total seats on our Board. They have been appointed in compliance with the
requirements under the Listing Rules to ensure that the decisions of the Board are made
only after due consideration of independent and impartial opinions. Our Directors
believe that the presence of the independent non-executive Directors from different
backgrounds provides a balance of views and opinions for our Board; and
(e) We have adopted a series of corporate governance measures to manage conflicts of
interest, if any, between our Company and our Controlling Shareholders Group which
would support our independent management. For details, see “— Corporate
Governance” in this section.
Based on the above, our Directors believe that our Board as a whole and together with our
senior management are able to perform the managerial role in our Company independently from
our Controlling Shareholders Group and their respective close associates after the Listing.
Operational Independence
We operate independently from our Controlling Shareholders Group and their respective close
associates. We make and implement operational decisions independently of our Controlling
Shareholders Group and has our own organizational structure with independent departments, each
with specific areas of responsibility. Furthermore, we have independent production capabilities and
technology relating to our Group’s business and do not rely on the operations of our Controlling
Shareholders Group. As of the Latest Practicable Date, the Group did not jointly own or develop
any intellectual properties or jointly operate any R&D centers with its Controlling Shareholders
Group or any of their respective close associates. We also maintain a set of comprehensive internal
control measures to facilitate the effective operation of our business. We have established
independent and comprehensive labor, personnel, and salary management systems, and have our
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own headcount of employees to operate the business for our operations and management for
human resources. We are independent of our Controlling Shareholders Group in terms of
organizational structure and personnel.
We have our independent sales and marketing teams. Members of our marketing team were
recruited by our Group independently. For each of the years ended December 31, 2022, 2023 and
2024 and the ten months ended October 31, 2025, there were no overlapping customers between
the Group and Dazu Holdings and Han’s Global. For each of the years ended December 31, 2022,
2023 and 2024 and the ten months ended October 31, 2025, approximately 4.98%, 5.09%, 5.09%
and 4.15% of the customers of our Group overlapped with those of Han’s Laser, respectively.
These overlapping customers were approached and dealt with by our Group and Han’s Laser
independently. Due to the following reasons, our Directors are of the view that sales to
overlapping customers does not result in reliance on Han’s Laser and its close associates and is in
the interests of the Company and the Shareholders as a whole:
(a) we have full discretion in marketing and sales channels, and all the transactions between
our Group and the overlapping customers are negotiated independently from Han’s Laser
and its close associates;
(b) most of the overlapping customers were large listed companies and conglomerate groups
which operated across a wide range of business sectors, including consumer electronics
and automotive electronics, and sought after different products from our Group and
Han’s Laser; and
(c) as advised by CIC, the customers in the downstream industries of the Company are
mostly large listed companies and large conglomerate groups, and it is not uncommon
that such customers seek for a wide range of different products for their business
operations.
We procure parts and materials used in R&D and manufacturing independently. We have a
separate procurement team and run our election and procurement process independently from our
Controlling Shareholders Group and their respective close associates. For each of the years ended
December 31, 2022, 2023 and 2024 and the ten months ended October 31, 2025, there were no
overlapping suppliers between the Group and Dazu Holdings and Han’s Global. For each of the
years ended December 31, 2022, 2023 and 2024 and the ten months ended October 31, 2025,
approximately 22.05%, 22.20%, 22.97% and 22.50% of the suppliers of our Group overlapped with
those of Han’s Laser, respectively. These overlapping suppliers were selected by our Group and
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Han’s Laser independently. Due to the following reasons, the Directors are of the view that
procurement from overlapping suppliers does not result in reliance on Han’s Laser and its close
associates and is in the interests of the Company and the Shareholders as a whole:
(a) we have full discretion to select our suppliers, and all the transactions between our
Group and the overlapping suppliers are negotiated independently from Han’s Laser and
its close associates;
(b) most of the overlapping suppliers are reputable large listed companies or conglomerate
groups supplying high-precision equipment general components which are commonly
used in the production of a wide range of machineries and equipment in various
industries such as motors, digital server drivers, motion controllers and various range of
lasers. Further, Han’s Laser operates across a broad spectrum of products and business
areas, necessitating procurement from a large pool of suppliers and increases the
chances of supplier overlapping with the Group;
(c) most general components are readily available from alternative suppliers in the market
at comparable prices, quality and terms as the overlapping suppliers; and
(d) as advised by CIC, most of the suppliers equipped with the professional and appropriate
qualities in meeting the Group’s demands in the upstream industries of the Group are
large listed companies and conglomerate groups, and it is not uncommon that such
suppliers supply a wide range of different products.
We entered into certain continuing connected transactions with our connected persons. Such
connected transactions are entered into for the daily operational need of the Company, and are
entered into upon arm’s length negotiation and on normal commercial terms or better. See section
headed “Connected Transactions” for more details. Considering that these transactions did not and
are not expected to involve significant transaction amounts and are not material to the operation of
our Group’s principal business, our Directors believe that such transactions will not have any
impact on the operational independence of our Group.
Based on the above, our Directors believe that our business is operationally independent from
our Controlling Shareholders Group and their respective close associates.
Financial Independence
We have an independent financial system and make financial decisions independently
according to our Company’s own business needs. We have our own internal control and accounting
systems and an independent finance department for discharging the treasury function and
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independent access to third party financing. We do not expect to rely on our Controlling
Shareholders Group and their respective close associates for financing after the Listing as we
expect that our working capital will be funded by cash flows generated from operating activities,
the cash and cash equivalent on hand as well as the proceeds from the Global Offering.
In addition, we are capable of obtaining financing from Independent Third Parties without
relying on any guarantee or security provided by our Controlling Shareholders Group or their
respective associates. As of the Latest Practicable Date, we did not have any outstanding loans or
guarantees provided by or granted to members of our Controlling Shareholders Group or their
respective associates, nor do we have any funds or assets occupied by members of our Controlling
Shareholders Group or their respective associates, or any shared bank accounts or commingled tax
filing with the Controlling Shareholders Group or their respective controlled corporations.
Based on the above, our Directors believe that we are financially independent from our
Controlling Shareholders Group and their respective close associates.
INTERESTS OF OUR CONTROLLING SHAREHOLDERS GROUP IN OTHER
BUSINESSES
Each member of our Controlling Shareholders Group confirmed that as of the Latest
Practicable Date, apart from the business of our Company, it/he did not have any interest in other
business, which competes or is likely to compete, directly or indirectly, with our business, which
would require disclosure under Rule 8.10 of the Listing Rules.
CORPORATE GOVERNANCE
Our Company will comply with the provisions of the Corporate Governance Code in
Appendix C1 to the Listing Rules (the “ Corporate Governance Code ”), which sets out principles
of good corporate governance.
Our Directors recognize the importance of good corporate governance in protection of our
Shareholders’ interests. We would adopt the following measures to safeguard good corporate
governance standards and to avoid potential conflict of interests between our Company and our
Controlling Shareholders Group and their respective close associates:
(a) where a Board meeting is held for the matters in which any Director or his/her
associates have a material interest, such Director(s) shall abstain from voting on the
relevant resolutions and shall not be counted in the quorum for the voting;
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(b) where a Shareholders’ meeting is to be held for considering proposed transactions in
which our Controlling Shareholders Group or any of their associates has a material
interest, our Controlling Shareholders Group or any of their associates will not vote on
the resolutions and shall not be counted in the quorum in the voting;
(c) as part of our preparation for the Global Offering, we have amended our Articles of
Association to comply with the Listing Rules which will become effective upon Listing.
In particular, our Articles of Association provides that, a Director shall be abstained
from voting on any resolution approving any contract, transaction or arrangement in
which such Director or any of his/her associates has a material interest nor shall such
Director be counted in the quorum present at the Board meeting;
(d) our Company has established internal control mechanisms to identify connected
transactions. Upon the Listing, if our Company enters into connected transactions with
our Controlling Shareholders Group or any of their associates, our Company will
comply with the applicable Listing Rules;
(e) we are committed that our Board shall include a balanced composition of executive
Director and non-executive Directors (including independent non-executive Directors).
We have appointed four independent non-executive Directors, and we believe our
independent non-executive Directors (i) possess sufficient experiences, (ii) are free of
any business or other relationship which could interfere in any material manner with the
exercise of their independent judgment, and (iii) will be able to provide an impartial and
external opinion to protect the interests of our Shareholders as a whole. For details of
the independent non-executive Directors, see “Directors and Senior Management”;
(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 Somerley Capital Limited as our compliance advisor to provide
advice and guidance to us in respect of compliance with the applicable laws and the
Listing Rules, including various requirements relating to corporate governance.
Based on the above, our Directors are satisfied that sufficient corporate governance measures
have been put in place to manage conflicts of interest between our Company and our Controlling
Shareholders Group, and to protect minority Shareholders’ interests after the Listing.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS GROUP
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Upon Listing, we will engage in certain transactions with our connected persons, which will
constitute continuing connected transactions under Chapter 14A of the Listing Rules.
OUR CONNECTED PERSONS
We have entered into certain transactions with the following connected persons, which will
constitute our continuing connected transaction upon Listing:
Names of our connected persons Connected Relationship
Han’s Laser (together with its subsidiaries apart
from our Group, the “ Han’s Laser Group ”)
Han’s Laser is a member of our Controlling
Shareholders Group.
Han’s TianCheng Semiconductor Co., Ltd. ( ̏
ʮ̡ )( “ Beijing
Tiancheng ”) and its subsidiary
Beijing Tiancheng is owned as to over 30% by
Han’s Laser, a member of our Controlling
Shareholders Group. Accordingly, Beijing
Tiancheng is an associate of Han’s Laser, and
therefore a connected person of our Company
under the Listing Rules.
Dazu Holdings and its associates (apart from
the Han’s Laser Group)
Dazu Holdings is a member of our Controlling
Shareholders Group.
SUMMARY OF OUR CONNECTED TRANSACTIONS
Transaction Counterparty Applicable Listing Rule Waiver sought
Fully-exempt Continuing Connected Transaction
1. Trademark licensing from
Han’s Laser ........
Han’s Laser 14A.76(1) N/A
Partially-exempt Continuing Connected Transactions
2. Procurement of products
and services from Han’s
Laser Group ........
Han’s Laser Group 14A.35, 14A.76(2) and
14A.105
Announcement requirement
3. Provision of products and
services to Han’s Laser
Group ............
Han’s Laser Group 14A.35, 14A.76(2) and
14A.105
Announcement requirement
CONNECTED TRANSACTIONS
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Transaction Counterparty Applicable Listing Rule Waiver sought
4. Procurement of lasers from
Beijing Tiancheng and
its subsidiary .......
Beijing Tiancheng 14A.35, 14A.76(2) and
14A.105
Announcement requirement
5. Procurement of property
and construction
management services
from Dazu Holdings ...
Dazu Holdings 14A.35, 14A.76(2) and
14A.105
Announcement requirement
FULLY-EXEMPT CONTINUING CONNECTED TRANSACTION
1. Trademark licensing from Han’s Laser
On April 28, 2025, our Company entered into a trademark licensing agreement with Han’s
Laser (“ Trademark License Agreement ”), pursuant to which Han’s Laser irrevocably granted to
us non-transferable licenses for the use of certain trademarks (“ Licensed Trademarks ”) on a
royalty-free basis for the validity period of the Licensed Trademarks commencing from the date of
the Trademark License Agreement provided that our Company remains as a consolidated subsidiary
of Han’s Laser. For details of the Licensed Trademarks, see “Appendix VI — Statutory and
General Information — 2. Further Information about our Business — B. Our Material Intellectual
Property Rights” in this Prospectus.
We believe that the entering into of the Trademark License Agreement with a term of more
than three years can ensure the stability of our operations, and is beneficial to us and the
Shareholders as a whole. The Sole Sponsor is of the view that it is not uncommon business
practice for agreements of this type to be of such duration.
As the right to use the Licensed Trademarks is granted to us on a royalty-free basis, the
transactions under the Trademark License Agreement fall within the de minimis threshold under
Rule 14A.76 of the Listing Rules and will be exempted from the reporting, annual review,
announcement and independent shareholders’ approval requirements under Chapter 14A of the
Listing Rules.
CONNECTED TRANSACTIONS
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--- page 296 ---
PARTIALLY-EXEMPT CONTINUING CONNECTED TRANSACTIONS
2. Procurement of products and services from Han’s Laser Group
On January 29, 2026, our Company (for and on behalf of the Group) entered into a
framework agreement with Han’s Laser (for and on behalf of Han’s Laser Group) (“ Procurement
Framework Agreement ”), pursuant to which, our Group would procure from Han’s Laser Group
comprehensive products and services, including but not limited to, accessories, raw materials and
repair services (“ Supporting Products and Services ”) as our Group may require from time to
time.
The initial term of the Procurement Framework Agreement will commence on the Listing
Date and will end on December 31, 2028, subject to renewal upon the mutual agreement of both
parties thereto. Relevant subsidiaries of both parties will enter into separate underlying agreements
and/or orders which will set out the specific terms and conditions according to the principles
provided in the Procurement Framework Agreement.
Reasons for the transaction
Our Group has a long-term and stable business cooperation with Han’s Laser Group. Han’s
Laser Group provides the Supporting Products and Services which we may require in the process
of our productions and operations. In our ordinary and usual course of business, our Group has
been procuring the Supporting Products and Services from Han’s Laser Group from time to time,
which enables them to be familiar with our business needs, quality standards and operational
requirements in respect of our production and assembly lines. Our Directors believe that
maintaining a stable and quality business relationship with Han’s Laser Group will facilitate our
business operations and growth.
Pricing policies
The fees to be paid to Han’s Laser Group by us under the Procurement Framework
Agreement shall be determined based on arm’s length negotiation between our Group and Han’s
Laser Group with reference to (i) the historical and prevailing market price, (ii) the type of
products and services to be procured, (iii) the terms, price and conditions offered by other
independent third-party suppliers, and (iv) the transaction volume of the products and services to
be procured. The terms shall be no less favorable to our Group compared to those transactions
between our Group and Independent Third Parties, which are in the best interests of our Company
and our Shareholders as a whole.
CONNECTED TRANSACTIONS
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--- page 297 ---
Historical amounts
For the years ended December 31, 2022, 2023 and 2024 and the ten months ended October
31, 2025, the historical amounts of the transactions contemplated under the Procurement
Framework Agreement were approximately RMB61.3 million, RMB43.1 million, RMB40.3 million
and RMB48.4 million, respectively.
Annual caps
The following table sets forth the proposed annual caps for the transactions contemplated
under the Procurement Framework Agreement:
Year ending December 31,
2026 2027 2028
(RMB in millions)
Total fees payable by us to
Han’s Laser Group ................. 99.7 124.6 157.7
The proposed annual caps are determined based on:
(i) the historical amounts of the transactions between our Group and Han’s Laser Group
during the Track Record Period in respect of the transactions contemplated under the
Procurement Framework Agreement. The major Supporting Products and Services we
procure from Han’s Laser Group include, among others, motors, sensors, chillers and
controllers (and corresponding repairing services), which are components of our PCB
production equipment products. Therefore, our demand for the Supporting Products and
Services is largely related to the number of PCB production equipment products that we
produce and sell. As the Han’s Laser Group is not the exclusive supplier of the
Supporting Products and Services of our Group, our relevant purchase therefrom also
depends on procurement allocation among all our suppliers, the transaction amount for
the year ended December 31, 2023 decreased from that in the year ended December 31,
2022, primarily due to the market downturn of the sales of our PCB production
equipment products. For the year ended December 31, 2024, as our previous
procurement was sufficient to satisfy our production needs, the procurement amount
remained steady as compared to that in the previous year despite the gradual recovery of
the market. For the ten months ended October 31, 2025, the procurement amount
increased due to the increased production quantity and sales revenue of our PCB
production equipment.
CONNECTED TRANSACTIONS
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--- page 298 ---
(ii) the expected amount of procurement of the Supporting Products and Services by our
Group from Han’s Laser Group taking into account the needs of our future business
growth and development. With respect to the proposed annual caps for the years ending
December 31, 2026, 2027 and 2028, we also take into account the projected growth of
the PCB industry and our business expansion in the coming years; and
(iii) other factors including but not limited to the expected prices of the Supporting Products
and Services and their potential fluctuations, taking into account the costs and expenses
relating to labor and market trends. Establishing a long-term procurement mechanism
with Han’s Laser Group helps ensure production continuity, control costs, and buffer
against price volatility.
Listing Rules implications
As the highest applicable percentage ratio of the transactions contemplated under the
Procurement Framework Agreement for the three years ending December 31, 2028 calculated for
the purpose of Chapter 14A of the Listing Rules will be more than 0.1% but less than 5% on an
annual basis, pursuant to Rule 14A.76(2) of the Listing Rules, such transactions will, upon Listing,
constitute continuing connected transactions of our Company subject to the annual reporting and
annual review requirements under Rules 14A.49 and 14A.71 of the Listing Rules and the
announcement requirement under Rule 14A.35 of the Listing Rules, but exempt from the
independent Shareholders’ approval requirement under Rule 14A.36 of the Listing Rules.
3. Provision of products and services to Han’s Laser Group
On January 29, 2026, our Company (for and on behalf of the Group) entered into a
framework agreement with Han’s Laser (for and on behalf of Han’s Laser Group) (“ Provision
Framework Agreement ”), pursuant to which our Group would provide PCB equipment products
and related services, including but not limited to, PCB equipment and machinery, and related
accessories and repair services to Han’s Laser Group as Han’s Laser Group may require from time
to time.
The initial term of the Provision Framework Agreement will commence on the Listing Date
and will end on December 31, 2028, subject to renewal upon the mutual agreement of both parties
thereto. Relevant subsidiaries of both parties will enter into separate underlying agreements and/or
orders which will set out the specific terms and conditions according to the principles provided in
the Provision Framework Agreement.
CONNECTED TRANSACTIONS
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--- page 299 ---
Reasons for the transaction
Han’s Laser Group has been one of our distributors. Our Group is engaged in, among others,
the provision of PCB equipment products and solutions to PCB manufacturers. Given our
competitive edge in the PCB equipment industry and the suitability and quality of our products,
certain manufacturing processes of some downstream non-PCB manufacturers of Han’s Laser
Group can also utilise our equipment products. The Provision Framework Agreement is entered
into solely for the purpose of supplying our Group’s PCB equipment products and solutions to
Han’s Laser Group from time to time, for onward distribution to some of its downstream non-PCB
manufacturers.
Pricing policies
The products and services fees to be paid by Han’s Laser Group to us under the Provision
Framework Agreement shall be determined based on arm’s length negotiation between our Group
and Han’s Laser Group with reference to (i) the historical and prevailing market price, (ii) the type
of products and services to be provided, (iii) the terms, price and conditions offered to other
independent third-party customers, and (iv) the transaction volume of the products and services to
be provided. The terms shall be no less favorable to our Group compared to those transactions
between our Group and Independent Third Parties, which are in the best interests of our Company
and our Shareholders as a whole.
Historical amounts
For the years ended December 31, 2022, 2023 and 2024 and the ten months ended October
31, 2025, the historical amounts of the transactions contemplated under the Provision Framework
Agreement were approximately RMB7.3 million, RMB2.4 million, RMB0.9 million and RMB5.3
million, respectively.
Annual caps
The following table sets forth the proposed annual caps for the sales of the above products
and services under the Provision Framework Agreement:
Year ending December 31,
2026 2027 2028
(RMB in millions)
Total fees payable by
Han’s Laser Group to us ............. 90.1 120.1 176.2
CONNECTED TRANSACTIONS
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--- page 300 ---
The proposed annual caps are determined based on:
(i) the historical amounts of the transactions contemplated under the Provision Framework
Agreement during the Track Record Period. The major products and services we provide
to the Han’s Laser Group include our PCB production equipment products and
associated accessories (along with corresponding repair services) for Han’s Laser
Group’s further distribution, the sales of which fluctuated as the demand of the
downstream customers during the Track Record Period. In particular, the historical
amount of the transactions contemplated under the Provision Framework Agreement
decreased from RMB2.4 million in the year ended December 31, 2023 to RMB0.9
million in the year ended December 31, 2024, primarily due to the decrease in the
downstream customers’ demand due to market fluctuations. Although the PCB market
has shown general signs of recovery, the downstream customers are in different
industries and hence have not picked up the market recovery in the PCB market in time
in 2024. However, the market started to pick up again in the ten months ended October
31, 2025 and our Group has commenced the sales of our PCB production equipment
products to a Singapore subsidiary of Han’s Laser such that the relevant transaction
amount for the ten months ended October 31, 2025 reached RMB4.0 million;
(ii) the expected amount of sales of the above products and services by our Group to Han’s
Laser Group to meet the needs of the downstream customers of Han’s Laser Group as
well as the potential business growth thereof. In particular, our Group has commenced
the sales of our PCB production equipment products to a Singapore subsidiary of Han’s
Laser, which was established in August 2023 and has been operating for over two years
and has been part of our new overseas distributorship since 2025. Driven by the overall
growth trend of the PCB industry, demand from the subsidiary’s downstream customers
is expected to further increase.
In particular, the proposed annual cap for 2026 was determined based on the fact that, as
of December 31, 2025, we had secured unexecuted orders totaling approximately
RMB26 million from Han’s Laser, which will be executed in 2026. Additionally, Han’s
Laser’s Singapore subsidiary has begun fulfilling orders for overseas markets. It is
expected that the amount of purchases by Han’s Laser’s Singapore subsidiary from our
Group is projected to increase substantially to meet demand in overseas market from
2026; and
(iii) other factors including but not limited to the expected prices of the above products and
services sold by our Group and their potential fluctuations, taking into account the costs
and expenses relating to labor and market trends.
CONNECTED TRANSACTIONS
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--- page 301 ---
Listing Rules implications
As the highest applicable percentage ratio of the transactions contemplated under the
Provision Framework Agreement for the three years ending December 31, 2028 calculated for the
purpose of Chapter 14A of the Listing Rules will be more than 0.1% but less than 5% on an annual
basis, pursuant to Rule 14A.76(2) of the Listing Rules, such transactions will, upon Listing,
constitute continuing connected transactions of our Company subject to the annual reporting and
annual review requirements under Rules 14A.49 and 14A.71 of the Listing Rules and the
announcement requirement under Rule 14A.35 of the Listing Rules, but exempt from the
independent Shareholders’ approval requirement under Rule 14A.36 of the Listing Rules.
4. Procurement of lasers from Beijing Tiancheng and its subsidiary
On January 29, 2026, our Company entered into a framework agreement with Beijing
Tiancheng (“ Beijing Tiancheng Procurement Framework Agreement ”), pursuant to which, the
Company would procure from Beijing Tiancheng and its subsidiary lasers and related products as
our production and operation may require from time to time.
The initial term of the Beijing Tiancheng Procurement Framework Agreement will commence
on the Listing Date and will end on December 31, 2028, subject to renewal upon the mutual
agreement of both parties thereto. The parties will enter into separate underlying agreements which
will set out the specific terms and conditions according to the principles provided in the Beijing
Tiancheng Procurement Framework Agreement.
Reasons for the transaction
We have a long-term and stable business cooperation with Beijing Tiancheng and its
subsidiary. In our ordinary and usual business, we have been procuring lasers from Beijing
Tiancheng and its subsidiary from time to time, which enables them to be familiar with our
business needs, quality standards and operational requirements in respect of our production and
assembly lines. Our Directors believe that maintaining a stable and quality business relationship
with Beijing Tiancheng and its subsidiary will facilitate our business operations and growth.
Pricing policies
The purchase price to be paid to Beijing Tiancheng and its subsidiary by us under the Beijing
Tiancheng Procurement Framework Agreement shall be determined based on arm’s length
negotiation between our Company and Beijing Tiancheng and its subsidiary with reference to (i)
the historical and prevailing market price, (ii) the type of products to be procured, (iii) the terms,
price and conditions offered by other independent third-party suppliers, and (iv) the transaction
CONNECTED TRANSACTIONS
– 291 –


--- page 302 ---
volume of the products to be procured. The terms shall be no less favorable to us compared to
those transactions between our Company and Independent Third Parties, which are in the best
interests of our Company and our Shareholders as a whole.
Historical amounts
For the years ended December 31, 2022, 2023 and 2024 and the ten months ended October
31, 2025, the historical amounts of the transactions contemplated under the Beijing Tiancheng
Procurement Framework Agreement were approximately RMB31.0 million, RMB5.2 million,
RMB20.1 million and RMB26.9 million, respectively.
Annual caps
The following table sets forth the proposed annual caps for the transaction amounts to be paid
by us to Beijing Tiancheng and its subsidiary under the Beijing Tiancheng Procurement Framework
Agreement:
Year ending December 31,
2026 2027 2028
(RMB in millions)
Total fees payable by us to
Beijing Tiancheng and its subsidiary ... 40.0 45.0 50.0
The proposed annual caps are determined based on:
(i) the historical amounts of the transactions contemplated under the Beijing Tiancheng
Procurement Framework Agreement during the Track Record Period. The lasers and
related products we procure from Beijing Tiancheng and its subsidiary are components
of our PCB production equipment products, the demand for which is therefore primarily
based on the number of PCB production equipment products that we produce and sell,
as well as our procurement allocation plan among all our suppliers;
(ii) the expected amount of procurement of lasers and related products by our Company
from Beijing Tiancheng and its subsidiary to meet the needs of our future business
development. Specifically: (a) given the increase in the Company’s order volume and
capacity planning for 2026, the procurement of lasers, as a critical component, is
expected to be correspondingly expanded, and (b) to mitigate upstream supply chain
fluctuations and ensure delivery stability, our Company plans to increase safety stock of
critical components in 2026. As a long-term related supplier, Beijing Tiancheng, which
CONNECTED TRANSACTIONS
– 292 –


--- page 303 ---
was established in November 2011 and began its cooperation with us in December 2014,
has proven product quality and delivery capability and we expect to maintain a
long-term partnership with them.
In particular, the proposed annual cap for 2026 was determined in consideration of the
fact that the items procured from Beijing Tiancheng, which will primarily be used in
photolithography equipment, are expected to experience growth in 2026. Accordingly,
the annual transaction amount under the Beijing Tiancheng Procurement Framework
Agreement in 2026 is anticipated to be significantly higher than in 2025; and
(iii) other factors including but not limited to the expected prices of lasers and related
products, and their potential fluctuations, taking into account the costs and expenses
relating to labor and market trends.
Listing Rules implications
As the highest applicable percentage ratio of the transactions contemplated under the Beijing
Tiancheng Procurement Framework Agreement for the three years ending December 31, 2028
calculated for the purpose of Chapter 14A of the Listing Rules will be more than 0.1% but less
than 5% on an annual basis, pursuant to Rule 14A.76(2) of the Listing Rules, such transactions
will, upon Listing, constitute continuing connected transactions of our Company subject to the
annual reporting and annual review requirements under Rules 14A.49 and 14A.71 of the Listing
Rules and the announcement requirement under Rule 14A.35 of the Listing Rules, but exempt from
the independent Shareholders’ approval requirement under Rule 14A.36 of the Listing Rules.
5. Procurement of property and construction management services from Dazu Holdings
On January 29, 2026, our Company entered into a framework agreement with Dazu Holdings,
a member of our Controlling Shareholders Group (“ Dazu Service Procurement Framework
Agreement ”), pursuant to which we would procure from Dazu Holdings and its associates (apart
from the Han’s Laser Group) property management services and project construction management
services for (i) the operation of our industrial parks, offices and employee dormitories; (ii) the
construction management services for our industrial park currently under construction as detailed
in “Business — Our Production Bases — Shenzhen Production Base” and “Financial Information
— Discussion of Certain Components of Consolidated Statements of Financial Position —
Non-current Assets and Non-current Liabilities — Property, Plant and Equipment”; and (iii) the
subsequent property management services required by our industrial park following the completion
of construction.
CONNECTED TRANSACTIONS
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--- page 304 ---
The initial term of the Dazu Service Procurement Framework Agreement will commence on
the Listing Date and will end on December 31, 2028, subject to renewal upon the mutual
agreement of both parties thereto. The parties will enter into separate underlying agreements which
will set out the specific terms and conditions according to the principles provided in the Dazu
Service Procurement Framework Agreement.
Reasons for the transaction
We have a long-term and stable business cooperation with Dazu Holdings. In our ordinary
and usual business, we have been procuring property management services and project
construction management services from Dazu Holdings and its subsidiaries from time to time,
which enables them to be familiar with our business needs, requirements and standards of our
Group’s properties and construction projects. Our Directors believe that maintaining a stable and
quality business relationship with Dazu Holdings will facilitate the management of our Group’s
properties and construction projects, including the Group’s industrial parks.
Pricing policies
The service fee payable by us to Dazu Holdings shall be determined based on arm’s length
negotiation between the parties with reference to (i) the price of the project construction services
as required by the relevant rules and regulations, (ii) the type of services to be procured, (iii) the
size, location and type of the relevant properties and construction projects, and (iv) the transaction
volume of the services to be procured. The terms shall be no less favorable to us compared to
those transactions between us and Independent Third Parties, which are in the best interests of our
Group and our Shareholders as a whole.
Historical amounts
For the years ended December 31, 2022, 2023 and 2024 and the ten months ended October
31, 2025, the historical transaction amounts were approximately RMB12.2 million, RMB17.6
million, RMB8.8 million and RMB7.4 million, respectively.
CONNECTED TRANSACTIONS
– 294 –


--- page 305 ---
Annual caps
The following table sets forth the proposed annual caps for the transaction amounts to be paid
by us to Dazu Holdings under the Dazu Service Procurement Framework Agreement:
Year ending December 31,
2026 2027 2028
(RMB in millions)
Total fees payable by us to
Dazu Holdings .................... 36.0 30.0 30.0
The proposed annual caps are determined based on:
(i) the relevant service rates of project construction services as required by the
Administrative Measures for Agent Construction of Nanshan District
Government-Invested Projects (جwhich serves as
a reference material for the pricing under the relevant transactions as it contains
standard price charges for similar projects;
(ii) the construction plans of the relevant projects currently under construction, including
our industrial parks, that require construction project management services. Since April
2022, we have engaged Dazu Holdings for project construction management services for
our industrial park project under construction, which is expected to be completed and
management services to be ended by June 30, 2026;
(iii) the payment schedule of project construction management services, taking into account
the installment of project construction management services to be paid upon completion
of construction of our industrial park by June 30, 2026;
(iv) the size, location, type, relocation and development plans of the relevant properties
during the term of the Dazu Service Procurement Framework Agreement. The property
management services required from Dazu Holdings are expected to have a substantial
increase, particularly in 2026, as a relatively large area will require property
management services when our industrial park starts to operate following its completion
of construction by June 30, 2026. Furthermore, upon the completion of the construction
of our industrial park, the project construction management service fees will be settled,
and no such expenses will occur in 2027 and 2028. Therefore, the expected proposed
annual caps under the Dazu Service Procurement Framework Agreement will decrease
slightly in 2027 and 2028; and
CONNECTED TRANSACTIONS
– 295 –


--- page 306 ---
(v) other factors including but not limited to the expected prices of the above services and
their potential fluctuations, taking into account the costs and expenses relating to labor
and construction materials.
Listing Rules implications
As the highest applicable percentage ratio of the transactions contemplated under the Dazu
Service Procurement Framework Agreement for the three years ending December 31, 2028
calculated for the purpose of Chapter 14A of the Listing Rules will be more than 0.1% but less
than 5% on an annual basis, pursuant to Rule 14A.76(2) of the Listing Rules, such transactions
will, upon Listing, constitute continuing connected transactions of our Company subject to the
annual reporting and annual review requirements under Rules 14A.49 and 14A.71 of the Listing
Rules and the announcement requirement under Rule 14A.35 of the Listing Rules.
INTERNAL CONTROL MEASURES ADOPTED BY THE COMPANY IN RESPECT OF
CONTINUING CONNECTED TRANSACTIONS
In order to further safeguard the interests of the Shareholders as a whole (including the
minority Shareholders), our Group has implemented the following internal control measures in
relation to the continuing connected transactions:
 we have adopted and implemented a management system on connected transactions.
Under such system, the Audit Committee under the Board is responsible for the review
on compliance with relevant laws, regulations, our Company’s policies and the Listing
Rules in respect of the continuing connected transactions. In addition, the Audit
Committee under the Board, the Board and various internal departments of our
Company are jointly responsible for evaluating the terms of the continuing connected
transactions, in particular, the fairness of the pricing policies and annual caps for each
transaction;
 the Audit Committee under the Board, the Board and various internal departments of our
Company also regularly monitor the fulfillment status and the updates in relation to the
continuing connected transactions. In addition, the management of our Company also
regularly reviews the pricing policies of the continuing connected transactions;
 our independent non-executive Directors and auditors will conduct annual review of the
continuing connected transactions and provide annual confirmation in accordance with
Rules 14A.55 and 14A.56 of the Listing Rules; and
CONNECTED TRANSACTIONS
– 296 –


--- page 307 ---
 when considering the service fees and other fees provided by us to the above connected
persons, our Company will continue to regularly research in prevailing market
conditions and practices and make reference to the pricing and terms between our
Company and Independent Third Parties for similar transactions, to ensure that the
pricing and terms offered by the above connected persons, either from bidding
procedures or mutual commercial negotiations (as the case may be), are fair, reasonable
and are no less favorable than those offered to Independent Third Parties.
DIRECTORS’ CONFIRMATION
Our Directors (including independent non-executive Directors) are of the view that: (i) the
continuing connected transactions under the Procurement Framework Agreement, Provision
Framework Agreement, Beijing Tiancheng Procurement Framework Agreement and Dazu Service
Procurement Framework Agreement (the “ Partially-Exempt Continuing Connected
Transactions ”) have been and will be entered into in our ordinary and usual course of business on
normal commercial terms or better, on terms that are fair and reasonable, and in the interests of
our Company and our Shareholders as a whole, and (ii) the proposed annual caps under each of the
Procurement Framework Agreement, Provision Framework Agreement, Beijing Tiancheng
Procurement Framework Agreement and Dazu Service Procurement Framework Agreement are fair
and reasonable and in the interests of our Company and the Shareholders as a whole.
SOLE SPONSOR’S CONFIRMATION
The Sole Sponsor has (i) reviewed the relevant documents and information provided by our
Company in relation to the Partially-Exempt Continuing Connected Transactions; and (ii)
participated in the due diligence and discussions with the management of our Group.
Based on the aforementioned and the Directors’ view above, the Sole Sponsor is of the view
that the Partially-Exempt Continuing Connected Transactions have been entered into in the
ordinary and usual course of our business on normal commercial terms, are fair and reasonable and
in the interests of our Company and our Shareholders as a whole, and that the proposed annual
caps in respect of the Partially-Exempt Continuing Connected Transactions are fair and reasonable
and in the interests of our Company and our Shareholders as a whole.
CONNECTED TRANSACTIONS
– 297 –


--- page 308 ---
WAIVERS GRANTED BY THE STOCK EXCHANGE
As the above Partially-Exempt Continuing Connected Transactions are expected to be carried
out on a recurring basis, our Directors consider that strict compliance with the aforesaid
announcement requirement will be impractical, and such requirements will lead to unnecessary
administrative costs and create an onerous burden on our Group. Accordingly, we have applied to
the Stock Exchange for, and the Stock Exchange has granted us, waivers pursuant to Rule 14A.105
of the Listing Rules from strict compliance with the announcement requirement under Rule 14A.35
of the Listing Rules in respect of transactions contemplated under the Procurement Framework
Agreement, Provision Framework Agreement, Beijing Tiancheng Procurement Framework
Agreement and Dazu Service Procurement Framework Agreement, provided that the total amount
of such transactions for the three years ending December 31, 2026, 2027 and 2028 shall not exceed
the proposed caps as set out in this section.
Apart from the announcement requirement from which a waiver is sought, the Company will
comply with the applicable requirements under Chapter 14A of the Rules. In the event of any
future amendments to the Listing Rules imposing more stringent requirements than those
applicable as of the Latest Practicable Date on the continuing connected transaction referred to in
this Prospectus, we will take immediate steps to ensure compliance with such new requirements
within reasonable time.
CONNECTED TRANSACTIONS
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--- page 309 ---
SUBSTANTIAL SHAREHOLDERS
So far as our Directors are aware, as of the Latest Practicable Date and immediately
following completion of the Global Offering (assuming the Over-allotment Option is not exercised
and no other changes are made to the issued share capital of our Company between the Latest
Practicable Date and Listing), the following persons will have an interest or short position (as
applicable) in our 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 issued voting shares of our Company:
Shareholder Nature of Interest
Number and
Description of
Shares
Approximate
Percentage of
Interest in the
Total Issued
Share Capital of
our Company as
of the Latest
Practicable Date
Approximate
Percentage of
Shareholding in
the A Shares
shortly after the
Global Offering
Approximate %
of Shareholding
in the Total
Issued Share
Capital of our
Company
immediately after
the Global
Offering
Mr. Gao ......... Interests in controlled
corporations (1)
359,100,000
A Shares
84.39% 84.39% 75.45%
Han’s Global ..... Interests in controlled
corporations (1)
359,100,000
A Shares
84.39% 84.39% 75.45%
Dazu Holdings ..... Interests in controlled
corporations (1)
355,868,100
A Shares
83.63% 83.63% 74.77%
Beneficial owner 3,231,900
A Shares
0.76% 0.76% 0.68%
Han’s Laser ....... Beneficial owner 355,868,100
A Shares
83.63% 83.63% 74.77%
Note:
(1) Han’s Laser is a company established in the PRC, the A Shares of which have been listed on the Shenzhen Stock
Exchange (stock code: 002008) and a consolidated subsidiary of Dazu Holdings. As of the Latest Practicable Date,
(i) Han’s Laser was held by Dazu Holdings, Mr. Gao and other A shareholders as to 15.71%, 9.36% and 74.93%,
respectively; and (ii) Dazu Holdings was directly held as to 99.875% by Mr. Gao, and as to 0.125% by Han’s
Global, which was in turn wholly and beneficially owned by Mr. Gao. As such, as of the Latest Practicable Date,
each of Mr. Gao, Han’s Global and Dazu Holdings was taken to be interested in the 359,100,000 A Shares of the
Company under the SFO.
Save as otherwise disclosed in this Prospectus, our Directors are not aware of any person who
will, immediately following the Global Offering (assuming the Over-allotment Option is not
exercised and no other changes are made to the issued share capital of our Company between the
SUBSTANTIAL SHAREHOLDERS
– 299 –


--- page 310 ---
Latest Practicable Date and Listing), have an interest or short position in the Shares or underlying
Shares of our Company which would be required to be disclosed under the provisions of Divisions
2 and 3 of Part XV of the SFO, or will, directly or indirectly, be interested in 10% or more of the
issued voting shares of any other members of our Group.
SHARE PLEDGE BY DAZU HOLDINGS
As of the Latest Practicable Date, 3,231,900 A Shares directly held by Dazu Holdings,
representing approximately 0.76% of our total issued share capital, were subject to pledge (the
“Share Pledge ”) granted in favour of Shenzhen High Tech Investment and Financing Guarantee
C o . ,L t d .(ʮ̡ )( “ Shenzhen High Tech Investment ”), a PRC
financing company.
The Share Pledge was provided by Dazu Holdings for the purpose of securing financing
facilities for Dazu Holdings to fund its businesses and investments. In March 2024, Dazu Holdings
made a public issuance of corporate bonds (the “ Bonds ”) with an amount of no more than
RMB500 million (including the principal amount) to professional investors and an interest of 3.2%
per year. The interests of the Bonds shall accrue and be paid annually since March 19, 2024, while
the principal amount shall be redeemable on March 19, 2027 (the “ Redemption Date ”). As part of
the credit enhancement measures, Shenzhen High Tech Investment provided guarantee with joint
and several liability for the repayment of the Bonds. In return of such guarantee, Dazu Holdings
granted the Share Pledge in favour of Shenzhen High Tech Investment.
As the Redemption Date is in March 2027, which is more than 12 months since the Listing
Date, our Company is of the view that it is unlikely that Dazu Holdings is forced by Shenzhen
High Tech Investment to trade out the A Shares it held within the lock-up period, to which Dazu
Holdings as a member of the Controlling Shareholders Group is subject under Rule 10.07 of the
Listing Rules, in the event of any defaults of the Bonds for the following reasons:
(a) pursuant to the terms of the Bonds and Share Pledge (i.e., the pledge of 3,321,900 A
Shares directly held by Dazu Holdings, representing only approximately 0.76% of the
Company’s issued share capital), the principal amount shall only be redeemable on
March 19, 2027 and therefore, in the unlikely event of a default in the repayment of the
principal amount, such default could only occur after March 19, 2027, by which time
the lock-up requirements applicable to Dazu Holdings under Rule 10.07 of the Listing
Rules, as a member of the Controlling Shareholders Group, will have expired;
SUBSTANTIAL SHAREHOLDERS
– 300 –


--- page 311 ---
(b) as of the Latest Practicable Date, Dazu Holdings was engaged in various revenue
generating business through its subsidiaries and held liquid assets, including operating
cashflow, self-owned funds, and investment income and was able to repay the annual
interests of the Bonds;
(c) to our best knowledge, Dazu Holdings has maintained stable business relationships and
good credit records with several PRC commercial banks for more than a decade; and
(d) to our best knowledge, there has not been any default in respect of the Share Pledge as
of the Latest Practicable Date.
Compliance by Dazu Holdings with Rule 10.07 of the Listing Rules is further ensured
through the following measures:
(a) Dazu Holdings has undertaken to the Stock Exchange that it will comply with the
relevant lock-up requirements under Rule 10.07 of the Listing Rules; and
(b) as required by the relevant rules of the Shenzhen Stock Exchange, Dazu Holdings shall
periodically publish on the website of the Shenzhen Stock Exchange reports on updates
relating to the Bonds, including but not limited to, the repayment of the Bonds, the
financial positions of Dazu Holdings, the credit ratings of the Bonds, and any other
relevant material developments.
SUBSTANTIAL SHAREHOLDERS
– 301 –


--- page 312 ---
BEFORE THE GLOBAL OFFERING
As of the Latest Practicable Date, the total issued share capital of our Company was
425,509,152 A Shares of nominal value of RMB1.00 each, which are all listed on the Shenzhen
Stock Exchange ChiNext Market.
Description of Shares Number of Shares
Approximate %
of issued share
capital
A Shares in issue .................................. 425,509,152 100.00%
Note: As of the Latest Practicable Date, no treasury Shares were held by the Company.
UPON COMPLETION OF THE GLOBAL OFFERING
Immediately following the completion of the Global Offering, assuming that the
Over-allotment Option is not exercised and no other changes are made to the issued share capital
of our Company between the Latest Practicable Date and the Global Offering, the share capital of
our Company will be as follows.
Description of Shares Number of Shares
Approximate %
of the enlarged
issued share
capital
A Shares in issue .................................. 425,509,152 89.40%
H Shares to be issued pursuant to the Global Offering ...... 50,451,800 10.60%
Total ............................................ 475,960,952 100.00%
SHARE CAPITAL
– 302 –


--- page 313 ---
Immediately following the completion of the Global Offering, assuming that the
Over-allotment Option is exercised in full and no other changes are made to the issued share
capital of our Company between the Latest Practicable Date and the Global Offering, the share
capital of our Company will be as follows.
Description of Shares Number of Shares
Approximate %
of the enlarged
issued share
capital
A Shares in issue .................................. 425,509,152 88.00%
H Shares to be issued pursuant to the Global Offering ...... 58,019,500 12.00%
Total ............................................ 483,528,652 100.00%
OUR SHARES
Our H Shares in issue upon completion of the Global Offering, and our A Shares, are
ordinary Shares in our share capital and are considered as one class of Shares. Shenzhen-Hong
Kong Stock Connect has established a stock connect mechanism between mainland China and
Hong Kong. Our A Shares can be subscribed for and traded by mainland Chinese investors,
qualified foreign institutional investors or qualified foreign strategic investors and must be traded
in Renminbi. As our A Shares are eligible securities under the Northbound Trading Link, they can
also be subscribed for and traded by Hong Kong and other overseas investors pursuant to the rules
and limits of Shenzhen-Hong Kong Stock Connect. Our H Shares can be subscribed for or traded
by Hong Kong and other overseas investors and qualified domestic institutional investors. If our H
Shares are eligible securities under the Southbound Trading Link, they can also be subscribed for
and traded by mainland Chinese investors in accordance with the rules and limits of
Shanghai-Hong Kong Stock Connect or Shenzhen-Hong Kong Stock Connect.
RANKING
Our H Shares and our A Shares are regarded as one class of Shares under our Articles of
Association and will rank pari passu with each other in all other respects and, in particular, will
rank equally for all dividends or distributions declared, paid or made after the date of this
Prospectus. All dividends in respect of our H Shares are to be paid by us in Hong Kong dollars
whereas all dividends in respect of our A Shares are to be paid by us in Renminbi. In addition to
cash, dividends may also be distributed in the form of Shares. Holders of our H Shares will
receive share dividends in the form of H Shares, and holders of our A Shares will receive share
dividends in the form of A Shares.
SHARE CAPITAL
– 303 –


--- page 314 ---
NO CONVERSION OF OUR A SHARES INTO H SHARES FOR LISTING AND TRADING
ON THE HONG KONG STOCK EXCHANGE
Our A Shares and our H Shares are generally neither interchangeable nor fungible, and the
market prices of our A Shares and our H Shares may be different after the Global Offering. The
Guidelines on Application for “Full Circulation” of Domestic Unlisted Shares of H-share
Companies (H΅͡ሗ “ஷ”ˏ) announced by the CSRC are not
applicable to companies dual listed in the PRC and on the Hong Kong Stock Exchange. As of the
Latest Practicable Date, there were no relevant rules or guidelines from the CSRC providing that A
Shareholders may convert A shares held by them into H shares for listing and trading on the Hong
Kong Stock Exchange.
APPROV AL FROM HOLDERS OF A SHARES REGARDING THE GLOBAL OFFERING
Approval from holders of A Shares is required for our Company to issue H Shares and seek
the listing of H Shares on the Hong Kong Stock Exchange. Such approval was obtained by us at
the shareholders’ general meeting of our Company held on May 12, 2025 and is subject to the
following conditions:
(i) Size of the offer . The proposed number of H Shares to be offered shall not exceed 10%
of the total issued share capital enlarged by the H Shares to be issued pursuant to the
Global Offering (before the exercise of the Over-allotment Option). The number of H
Shares to be issued pursuant to the full exercise of the Over-allotment Option shall not
exceed 15% of the total number of H Shares to be offered initially under the Global
Offering.
(ii) Method of offering. The method of offering shall be by way of an international offering
to institutional investors and a public offer for subscription in Hong Kong.
(iii) Target investors. The H Shares shall be issued to public investors in Hong Kong under
the Hong Kong Public Offering and international investors, qualified domestic
institutional investors in mainland China and other investors who are approved by
mainland Chinese regulatory bodies to invest abroad in International Offering.
(iv) Price determination basis. The issue price of the H Shares will be determined, among
others, after due consideration of the interests of existing shareholders of our Company,
acceptance of investors and the risks related to the offering, according to international
practice, through the demands for orders and book building process, subject to the
domestic and overseas capital market conditions and by reference to the valuation level
of comparable companies in domestic and overseas markets.
SHARE CAPITAL
– 304 –


--- page 315 ---
(v) V alidity period. The issue of H Shares and listing of H Shares on the Hong Kong Stock
Exchange shall be completed within 24 months from the date when the shareholders’
meeting was held on May 12, 2025.
There is no other approved offering plans for our Shares except the Global Offering.
SHAREHOLDERS’ GENERAL MEETINGS
For details of circumstance under which our shareholders’ general meeting is required, see
“Appendix V — Summary of the Articles of Association — Shareholders and Shareholders’
Meetings” in this Prospectus.
SHARES SCHEME
Certain employees of our Group are eligible to subscribe for interests of our Shares through
our share incentive scheme. For details, please refer to “Appendix VI — Statutory and General
Information — 4. Our Incentive Scheme” in this Prospectus.
SHARE CAPITAL
– 305 –


--- page 316 ---
THE CORNERSTONE PLACING
We have entered into cornerstone investment agreements (each a “ Cornerstone Investment
Agreement ” and collectively, the “ Cornerstone Investment Agreements ”) with the cornerstone
investors as set out below (each a “ Cornerstone Investor ” and collectively, the “ Cornerstone
Investors ”), pursuant to which the Cornerstone Investors have agreed to, subject to certain
conditions, subscribe or cause their designated entities to subscribe (as the case maybe) at the
Offer Price for such number of Offer Shares (rounded down to the nearest whole board lot of 100
H Shares) that may be purchased for an aggregate amount of US$309.8 million, equivalent to
approximately HK$2,416.0 million (calculated using the Hong Kong dollar to US dollar exchange
rate as disclosed in this Prospectus) (the “ Cornerstone Placing ”).
Pursuant to paragraph 3.2 of Practice Note 18 to the Listing Rules, at least 40% of the total
number of Offer Shares initially offered in the Global Offering must be allocated to investors in
the placing tranche (other than the Cornerstone Investors). As the Company is initially offering
approximately 10% of the total number of Offer Shares in the Hong Kong Public Offering, no
more than 50% of the total number of the Offer Shares initially offered in the Global Offering can
be allocated to all Cornerstone Investors (the “ Cornerstone Placing Allocation Limit ”). Each of
the Cornerstone Investors has agreed in their respective Cornerstone Investment Agreements that
the Company, the Sole Sponsor and the Sponsor-Overall Coordinator shall have the right to, in
their sole and absolute discretion, adjust the allocation of the number of Offer Shares to be
subscribed for by the relevant Cornerstone Investor to ensure compliance with the Listing Rules,
including the Cornerstone Placing Allocation Limit. Accordingly, the Company, the Sole Sponsor
and the Sponsor-Overall Coordinator will adjust the allocation of the number of Offer Shares to be
subscribed for by the Cornerstone Investors in proportion to their respective initial subscription
amounts set out in their respective Cornerstone Investment Agreements to ensure compliance with
the Cornerstone Placing Allocation Limit in the event that the final Offer Price is set at HK$95.80
or lower, and will disclose the number of the Offer Shares finally allocated to each of the
Cornerstone Investors in the allotment results announcement of the Company to be published on or
around Thursday, February 5, 2026.
CORNERSTONE INVESTORS
– 306 –


--- page 317 ---
Assuming an Offer Price of HK$95.80 per Share, being the maximum Offer Price, the total
number of Offer Shares to be subscribed by the Cornerstone Investors would be 25,218,400 Offer
Shares. The table below reflects the shareholding percentage immediately after the completion of
the Global Offering.
Assuming the Over-allotment Option is not exercised Assuming the Over-allotment Option is exercised in full
Approximate % of the
Offer Shares
Appropriate % of the
total issued share
capital immediately
upon completion of
the Global Offering
Approximate % of the
Offer Shares
Appropriate % of the
total issued share
capital immediately
upon completion of
the Global Offering
49.99% 5.30% 43.47% 5.22%
Our Company is of the view that the Cornerstone Placing will help to raise the profile of our
Company and to signify that such investors have confidence in our business and prospect. Our
Company became acquainted with each of the Cornerstone Investors through the business network
of the Group and the Underwriters.
The Cornerstone Placing will form part of the International Offering, and, save as otherwise
obtained consent from the Stock Exchange, the Cornerstone Investors and their respective close
associates will not acquire any Offer Shares under the Global Offering other than pursuant to the
Cornerstone Investment Agreement. The Offer Shares to be subscribed for by the Cornerstone
Investors will rank pari passu in all respects with the fully paid Shares in issue and will be
counted towards the public float for the purpose of Rule 8.08 of the Listing Rules. The three
largest public Shareholders will not hold more than 50% of the Shares held in public hands at the
time of the Listing in compliance with Rule 8.08(3) and Rule 8.24 of the Listing Rules.
Immediately following the completion of the Global Offering, the Cornerstone Investors and their
close associates will not, by virtue of the Cornerstone Placing, have any Board representation in
our Company; and none of the Cornerstone Investors and their close associates will become a
substantial Shareholder of our Company. The Cornerstone Investors and their close associates do
not have any preferential rights in the Cornerstone Investment Agreements compared with other
public Shareholders, other than a guaranteed allocation of the relevant Offer Shares at the Offer
Price.
As confirmed by each of the Cornerstone Investors, there are no side agreements or
arrangements between the Company, any member of the Group, or any of their respective
affiliates, directors, officers, employees, agents or representatives in the Global Offering and the
Cornerstone Investors, any of their respective affiliates, directors, officers, employees, agents or
representatives, or any benefit, direct or indirect, conferred on the Cornerstone Investors, any of
CORNERSTONE INVESTORS
– 307 –


--- page 318 ---
their respective affiliates, directors, officers, employees, agents or representatives by virtue of or
in relation to the Cornerstone Placing other than a guaranteed allocation of the relevant Offer
Shares at the Offer Price.
Among the Cornerstone Investors, MSIP (as defined below) is an existing minority
Shareholder. The Stock Exchange has granted a waiver from strict compliance with the
requirements under Rule 10.04 and consent under Paragraph 1C(2) of the Appendix F1 to the
Listing Rules to permit H Shares in the International Offering to be placed to certain existing
minority Shareholders and/or their close associates. For further details, see “Waivers from Strict
Compliance with the Listing Rules and Exemptions from the Companies (Winding Up and
Miscellaneous Provisions) Ordinance — Allocation of H Shares to Existing Minority Shareholders
and their Close Associates.”
To the best of the knowledge, information and belief of our Company, save as disclosed
above, (i) each of the Cornerstone Investors and their respective ultimate beneficial owners is an
Independent Third Party and is independent of the Group, its connected persons and their
respective close associates; (ii) none of the Cornerstone Investors is accustomed to take or has
taken instructions from our Company, the Directors, the chief executive of our Company, the
Controlling Shareholders Group, substantial Shareholders, existing Shareholders or any of their
subsidiaries or their respective close associates in relation to the acquisition, disposal, voting or
other disposition of the Offer Shares; (iii) none of the subscription of the Offer Shares by the
Cornerstone Investors is directly or indirectly financed, funded or backed back by our Company,
the Directors, the chief executive of our Company, the Controlling Shareholders Group, substantial
Shareholders, existing Shareholders or any of their subsidiaries or their respective close associates;
(iv) save for Wind Sabre (as defined below), each Cornerstone Investor will be utilizing its
internal financial resources, financial resources of its shareholders or (in the case of Cornerstone
Investors which are funds or investment managers) the assets managed for its investors as its
source of funding for the subscription of the Offer Shares; (v) each Cornerstone Investor has
sufficient funds to settle its respective investment under the Cornerstone Placing; and (vi) each of
the Cornerstone Investors has confirmed that all necessary approvals have been obtained with
respect to the Cornerstone Placing and that no specific approval from any stock exchange (if
relevant) is required for the relevant Cornerstone Placing. In addition, to the best knowledge of our
Company, each of the Cornerstone Investors is independent from each other and makes
independent investment decisions.
If there is over-allocation in the International Offering, there may be delayed delivery of the
Offer Shares to be subscribed by the Cornerstone Investors under the Cornerstone Placing. All of
the Cornerstone Investors have agreed that the Sponsor-Overall Coordinator may, in its sole
discretion, defer the delivery of all or part of the Offer Shares that such Cornerstone Investors
have subscribed for to a date later than the Listing Date. All of the Cornerstone Investors,
CORNERSTONE INVESTORS
– 308 –


--- page 319 ---
including the aforesaid Cornerstone Investors who have agreed to a potential delayed delivery
arrangement, have agreed to fully pay for the relevant Offer Shares that they have subscribed
before dealings in the Company’s Offer Shares commence on the Stock Exchange.
Details of the actual number of Offer Shares to be allocated to the Cornerstone Investors will
be disclosed in the allotment results announcement of our Company to be published on or around
Thursday, February 5, 2026.
THE CORNERSTONE INVESTORS
The information about our Cornerstone Investors set forth below has been provided by our
Cornerstone Investors in connection with the Cornerstone Placing.
Hongxing International
Hongxing International Technology Limited (ʮ̡ )( “ Hongxing
International ”) will subscribe for and hold the relevant number of Offer shares under the
Cornerstone Investment Agreement. Hongxing International is a limited company established under
the laws of Hong Kong and is wholly owned by Victory Giant Technology (HuiZhou) Co., Ltd. ( ௷
Ҧ(౉ψ)ʮ̡ ), a company established under the laws of PRC, and the A Shares of
which are listed on the Shenzhen Stock Exchange (stock code: 300476).
GIC Private Limited
GIC Private Limited will subscribe for and hold the relevant number of Offer shares under
the Cornerstone Investment Agreement. GIC Private Limited is a leading global investment firm
established in 1981 to secure Singapore’s financial future. As the manager of Singapore’s foreign
reserves, it takes a long-term, disciplined approach to investing. Its asset allocation strategy spans
three asset groups — Equities, Fixed Income, and Real Assets. These include investments in
developed and emerging market equities, nominal and inflation-linked bonds, private equity, real
estate, alternatives, and infrastructure. Its long-term approach, multi-asset capabilities, and global
connectivity enable it to be an investor of choice. It seeks to add meaningful value to its
investments. Headquartered in Singapore, it has a global talent force of over 2,300 people in 11
key financial cities and have investments in over 40 countries.
CORNERSTONE INVESTORS
– 309 –


--- page 320 ---
Schroders
SIMSL
Schroder Investment Management (Singapore) Ltd (“ SIMSL ”), acting as a discretionary
investment manager for and on behalf of certain funds and/or segregated accounts with a focus on
Asian Equities, has entered into the cornerstone investment agreement with the Company. To the
best of SIMSL’s knowledge, no single ultimate beneficial owner holds 30% or more interest in the
participating accounts of such funds/accounts, and each of such fund/account is an Independent
Third Party.
SIMSL is a company incorporated in Singapore. SIMSL is ultimately wholly owned by
Schroders plc, whose ordinary shares are listed on the London Stock Exchange (LON: SDR).
There is no individual person who is the “ultimate controlling shareholder” of Schroders plc. The
interests of some members of the Schroder family, are spread across a number of parties, who are
collectively known as the Principal Shareholder Group (PSG).
SIMHK
Schroder Investment Management (Hong Kong) Limited (“ SIMHK ” ) ,a c t i n ga sa
discretionary investment manager for and on behalf of certain funds and/or segregated accounts
with a focus on Asian Equities, has entered into the cornerstone investment agreement with the
Company. To the best of SIMHK’s knowledge, no single ultimate beneficial owner holds 30% or
more interest in the participating accounts of such funds/accounts, and each of such fund/account
is an Independent Third Party.
SIMHK is a company incorporated in Hong Kong. SIMHK is ultimately wholly owned by
Schroders plc, whose ordinary shares are listed on the London Stock Exchange (LON: SDR).
There is no individual person who is the “ultimate controlling shareholder” of Schroders plc. The
interests of some members of the Schroder family, are spread across a number of parties, who are
collectively known as the Principal Shareholder Group (PSG).
HHLRA
HHLR Advisors, Ltd. (“ HHLRA ”), an exempted company incorporated in the Cayman
Islands, will subscribe for the relevant number of Offer shares under the Cornerstone Investment
Agreement in its capacity as an investment manager and on behalf of the investment funds
(collectively, the “ HHLRA Funds ”), which are limited partnerships formed under the laws of the
Cayman Islands. There is no individual limited partner investor who holds an economic interest of
30% or more in the HHLRA Funds.
CORNERSTONE INVESTORS
– 310 –


--- page 321 ---
HHLRA collaborates with industry-defining enterprises, aiming to establish alignment with
thinking companies across industrial, consumer, healthcare and business services sectors. HHLRA
manages capital for global institutions, including non-profit foundations, endowments, and
pensions.
MSIP
Morgan Stanley & Co. International plc (“ MSIP”) will subscribe for and hold the relevant
number of Offer Shares under the Cornerstone Investment Agreement on a principal basis. MSIP is
a company incorporated in the United Kingdom. The ultimate parent undertaking and controlling
entity is Morgan Stanley. Morgan Stanley together with its subsidiary undertakings forms the
“Morgan Stanley Group”. Morgan Stanley is a global financial services firm authorised as a
Financial Holding Company and regulated by the Board of Governors of the Federal Reserve
System in the United States of America. The Morgan Stanley Group operates within the financial
services industry and is subject to extensive supervision and regulation.
The principal activity of the Morgan Stanley Group is the provision of financial services to a
global client base consisting of corporations, governments and financial institutions. Financial
services include investment banking, sales and trading, and other services to clients.
Fullgoal
Fullgoal HK
Fullgoal Asset Management (HK) Limited (“ Fullgoal HK ”) will subscribe for and hold the
relevant number of Offer shares under the Cornerstone Investment Agreement both on a
proprietary investment basis and on behalf of its clients who are Independent Third Parties. No
ultimate beneficial owner of any single client contributed 30% or more of the total funds used for
the Cornerstone Investment made by Fullgoal HK. Established in 2012 in Hong Kong, Fullgoal
HK is a wholly owned subsidiary of Fullgoal Fund Management Co., Ltd. (“ Fullgoal Fund ”).
Fullgoal HK has Type 1 (Dealing in Securities), Type 4 (Advising on Securities) and Type 9 (Asset
Management) licenses issued by the SFC.
Fullgoal Fund
Fullgoal Fund will subscribe for and hold the relevant number of Offer shares under the
Cornerstone Investment Agreement on behalf of its clients who are Independent Third Parties. No
ultimate beneficial owner of any single client contributed 30% or more of the total funds used for
the Cornerstone Investment made by Fullgoal Fund. Fullgoal Fund is a fund management company
established in China in April 1999, and is one of the first ten fund management companies
CORNERSTONE INVESTORS
–3 1 1–


--- page 322 ---
authorized by the CSRC and other regulatory authorities to obtain full licenses to provide asset
management services in the PRC. Fullgoal Fund has a registered capital of RMB520 million and
its main scope of business includes the provision of traditional fund management services, fund
raising, fund sale and asset management solutions to both domestic and overseas clients. Fullgoal
Fund is a QDII approved by the relevant PRC authority and is also the first fund management
company with foreign equity participation among the first ten fund management companies in
China. The relevant funds proposed to subscribe for the Offer Shares under the management of
Fullgoal Fund are open-ended publicly raised securities investment funds registered with the
CSRC.
The shareholders of Fullgoal Fund include (i) Guotai Haitong Securities Co., Ltd. ( ਷इऎஷ
ʮ̡ ) holding 27.775% in Fullgoal Fund; (ii) Shenwan Hongyuan Securities Co.,
Ltd. (ʮ̡ ) holding 27.775% in Fullgoal Fund; (iii) Bank of Montreal holding
27.775% in Fullgoal Fund, and (iv) Shandong Financial Asset Management Co., Ltd. (ፄ
ʮ̡ ), holding 16.675% in Fullgoal Fund.
Tibet Longrising and CICC Financial Trading Limited (in connection with Tibet Longrising
OTC Swaps)
CICC Financial Trading Limited and China International Capital Corporation Limited will
enter into a series of cross border delta-one OTC swap transactions (collectively, the “ Tibet
Longrising OTC Swaps ”) with each other and the ultimate clients (the “ CICC FT Ultimate
Clients (Tibet Longrising) ”), pursuant to which CICC FT will hold the Offer Shares on a
non-discretionary basis to hedge the Tibet Longrising OTC Swaps while the economic risks and
returns of the underlying Offer Shares are passed to the CICC FT Ultimate Clients (Tibet
Longrising), subject to customary fees and commissions. The Tibet Longrising OTC Swaps will be
fully funded by the CICC FT Ultimate Clients (Tibet Longrising). During the terms of the Tibet
Longrising OTC Swaps, all economic returns of the Offer Shares subscribed by CICC FT will be
passed to the CICC FT Ultimate Clients (Tibet Longrising) and all economic loss shall be borne by
the CICC FT Ultimate Clients (Tibet Longrising) through the Tibet Longrising OTC Swaps, and
CICC FT will not take part in any economic return or bear any economic loss in relation to the
Offer Shares. The Tibet Longrising OTC Swaps are linked to the Offer Shares and the CICC FT
Ultimate Clients (Tibet Longrising) may, after expiration of the lock-up period beginning from the
date of the cornerstone agreement entered into between CICC FT and the Company and ending on
the date which is six months from the Listing Date, request to early terminate the Tibet Longrising
OTC Swaps at their own discretions, upon which CICC FT may dispose of the Offer Shares and
settle the Tibet Longrising OTC Swaps in cash in accordance with the terms and conditions of the
Tibet Longrising OTC Swaps. Despite that CICC FT will hold the legal title of the Offer Shares by
itself, it will not exercise the voting rights attaching to the relevant Offer Shares during the terms
of the Tibet Longrising OTC Swaps according to its internal policy. To the best of CICC FT’s
CORNERSTONE INVESTORS
– 312 –


--- page 323 ---
knowledge having made all reasonable inquiries, each of the CICC FT Ultimate Clients (Tibet
Longrising) is an independent third party of CICC FT, China International Capital Corporation
Hong Kong Securities Limited (“ CICCHKS ”) and the companies which are members of the same
group of CICCHKS. Save for Zeng Xiaojie ( ಀወᆎ), a professional individual investor who owns
approximately 39.15% in CICC FT Ultimate Clients (Tibet Longrising), namely Longrising —
Shengshi No. 8 Private Securities Investment Fund ( ๕ᆀ᳅-᳅˰8ږand
approximately 98.32% in Longrising Qiangshu Private Securities Investment Fund ( ๕ᆀ᳅੶ዓӷ
ږand Yang Jianhai (ऎ), a professional individual investor who owns
approximately 96.16% in Longrising Xinyun Private Securities Investment Fund ( ๕ᆀ᳅อථӷ෍
ږthere is no other single ultimate beneficial owner holds 30% or more interests in
each of the CICC FT Ultimate Clients (Tibet Longrising).
CICC FT is a wholly-owned subsidiary of China International Capital Corporation Limited,
of which its shares are listed on the Shanghai Stock Exchange (stock code: 601995) and the Stock
Exchange (stock code: 3908). CICC FT is a connected client (as defined under Appendix F1 to the
Listing Rules) of CICCHKS, holding securities on a non-discretionary basis on behalf of
independent third parties. The Company has applied to the Stock Exchange for, and the Stock
Exchange has granted, its consent under paragraph 1C(1) of Appendix F1 to the Listing Rules to
permit us to allocate the Offer Shares to CICC FT. See “Waivers from Strict Compliance with the
Listing Rules and Exemptions from the Companies (Winding Up and Miscellaneous Provisions)
Ordinance — Consent in respect of the Proposed Subscription of Offer Shares by a Cornerstone
Investor who is a Connected Client.”
The CICC FT Ultimate Clients (Tibet Longrising) are five private funds managed by Tibet
Longrising Asset Management Co., Ltd. (“ Tibet Longrising ”) on a discretionary basis in its
capacity as investment manager. Tibet Longrising is established among the early cohort of private
fund managers in China, is a member of both the Asset Management Association of China
(AMAC) and the Securities Association of China (SAC). The company maintains offices in
Beijing, Shanghai, Hong Kong and Lhasa (Tibet), with assets under management (AUM) exceeding
RMB20 billion. Its entrusted capital primarily comes from high-net-worth clients of mainstream
financial institutions including domestic commercial banks and securities firms in China. Its
subsidiary holds a Type 9 Asset Management License issued by the Securities and Futures
Commission (SFC) of Hong Kong, empowering it to conduct asset management business in the
Hong Kong market.
Save for Zeng Xiaojie holding 61.75% equity interest in Tibet Longrising, there is no other
shareholder who owns 30% or more in Tibet Longrising.
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ICBC Wealth
ICBC Wealth Management Co., Ltd. (“ ICBC Wealth ”) was established in May 2019 in
Beijing, with a registered capital of RMB16 billion. It is a wholly-owned subsidiary of Industrial
and Commercial Bank of China Limited, a company listed on the Shanghai Stock Exchange (stock
code: 601398) and the Stock Exchange (stock code: 1398). The business scope of ICBC Wealth is
public issuance of wealth management products to the general public, investment and management
of entrusted assets for investors; non-public issuance of wealth management products to qualified
investors, investment and management of entrusted assets for investors; wealth management
advisory and consulting services; and other businesses as approved by the banking regulatory
authority under the State Council.
As confirmed by ICBC Wealth, the subscription of the Offer Shares as a cornerstone investor
will be made by ICBC Wealth in its capacity as the investment manager of certain wealth
management products under its discretionary management, and no single ultimate beneficial owner
holds 30% or more interests in such products.
Wind Sabre
Wind Sabre Fund SPC on behalf of Wind Sabre Opportunities Fund SP (“ Wind Sabre ”) will
subscribe for and hold the relevant number of Offer shares under the Cornerstone Investment
Agreement. Wind Sabre is a fund established in the Cayman Islands holding securities on a
discretionary basis on behalf of its clients who are Independent Third Parties. Wind Sabre Fund
SPC is a Segregated Portfolio Company incorporated in the Cayman Islands with limited liabilities
and is an independent third party, and Wind Sabre Opportunities Fund SP is a segregated portfolio
of Wind Sabre Fund SPC. Wind Sabre Fund SPC is controlled by Wind Sabre Capital Limited as
the investment manager, which is a company incorporated in Hong Kong and licensed to carry out
type 9 (asset management) regulated activities under the SFO in Hong Kong by the SFC. Well
Smart Developments Limited, which is wholly owned by Chow Tai Fook (Nominee) Limited, an
Independent Third Party, is the only investor who holds 30% or more interest in the fund. No
single ultimate beneficial owner holds 30% or more interest in Chow Tai Fook (Nominee) Limited.
Wind Sabre may obtain external financing from a prime broker to finance its subscription of
H Shares. The loan(s), if obtained, will be on normal commercial terms after arm’s length
negotiations. The H Shares to be subscribed for by Wind Sabre will not be charged to such prime
broker as security for such loan(s).
CORNERSTONE INVESTORS
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OmniVision HK
WILL Semiconductor Limited (“ OmniVision HK ”) is a limited liability company
incorporated under the laws of Hong Kong in 2008 principally engaged in the business of
semiconductor design and sales. OmniVision HK is a wholly-owned subsidiary of OmniVision
Integrated Circuits Group, Inc. (“ OmniVision ”), a company listed on the Shanghai Stock
Exchange (stock code: 603501) and the Stock Exchange (stock code: 0501). OmniVision is the
third largest digital image sensor providers globally, with a diversified portfolio of products and
solutions, a flexible fabless business model, and an extensive customer network and supply chain
ecosystem. It serves a wide range of high-growth verticals such as smartphone, automobile,
medical, surveillance and emerging markets such as machine vision, smart glasses and Edge AI.
The table below sets forth the details of the Cornerstone Placing:
Based on the Offer Price of HK$95.80 per H Share (being the maximum Offer Price)
Cornerstone Investors
Total
Investment
Amount (in
US$ millions)
Number of
Offer Shares
to be
acquired (4)
Assuming the Over-allotment
Option is not exercised
Assuming the Over-allotment
Option is exercised in full
Approximate
%o ft h e
Offer Shares
Approximate
% of our total
issued share
capital
immediately
upon
completion of
the Global
Offering
Approximate
%o ft h e
Offer Shares
Approximate
% of our total
issued share
capital
immediately
upon
completion of
the Global
Offering
Hongxing International ....... 60.0 4,884,200 9.68% 1.03% 8.42% 1.01%
GIC Private Limited ......... 90.0 7,326,300 14.52% 1.54% 12.63% 1.52%
Schroders ................ 75.0 6,105,200 12.10% 1.28% 10.52% 1.26%
HHLRA ................. 25.0 2,035,000 4.03% 0.43% 3.51% 0.42%
MSIP .................. 10.0 814,000 1.61% 0.17% 1.40% 0.17%
Fullgoal ................. 10.0 814,000 1.61% 0.17% 1.40% 0.17%
Fullgoal HK ............ 3.0 569,800 1.13% 0.12% 0.98% 0.12%
Fullgoal Fund ........... 7.0 244,200 0.48% 0.05% 0.42% 0.05%
Tibet Longrising and CICC
Financial Trading Limited (in
connection with Tibet
Longrising OTC Swaps) .... 10.0 814,000 1.61% 0.17% 1.40% 0.17%
ICBC Wealth ............. 10.0 814,000 1.61% 0.17% 1.40% 0.17%
Wind Sabre .............. 10.0 814,000 1.61% 0.17% 1.40% 0.17%
OmniVision HK ........... 9.8 797,700 1.58% 0.17% 1.37% 0.16%
Total .................. 309.8 25,218,400 49.99% 5.30% 43.47% 5.22%
CORNERSTONE INVESTORS
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Notes:
(1) The total investment amount excludes brokerage, SFC transaction levy, AFRC transaction levy and the Stock
Exchange trading fee and is calculated based on the exchange rates as described in the section headed “Information
about this Prospectus and the Global Offering — Currency Translations.”
(2) The total investment amount includes brokerage, SFC transaction levy, AFRC transaction levy and the Stock
Exchange trading fee and is calculated based on the exchange rates as described in the section headed “Information
about this Prospectus and the Global Offering — Currency Translations.”
(3) Each of the Cornerstone Investors has agreed in their respective Cornerstone Investment Agreements that the
Company, the Sole Sponsor and the Sponsor-Overall Coordinator shall have the right to, in their sole and absolute
discretion, adjust the allocation of the number of Offer Shares to be subscribed for by the relevant Cornerstone
Investor to ensure compliance with the Listing Rules, including the Cornerstone Placing Allocation Limit. The
Company, the Sole Sponsor and the Sponsor-Overall Coordinator will adjust the allocation of the number of Offer
Shares to be subscribed for by the Cornerstone Investors in proportion to their respective initial subscription
amounts set out in their respective Cornerstone Investment Agreements where necessary based on the final Offer
Price and will disclose the number of the Offer Shares finally allocated to each of the Cornerstone Investors in the
allotment results announcement of the Company to be published on or around Thursday, February 5, 2026.
(4) Subject to rounding down to the nearest whole board lot of 100 H Shares. Calculated based on the exchange rate
set out in “Information about this Prospectus and the Global Offering — Currency Translations.”
CLOSING CONDITIONS
The obligation of each of the Cornerstone Investors to acquire the Offer Shares under the
respective Cornerstone Investment Agreement is subject to, among other things, the following
closing conditions:
(i) the Underwriting Agreements for the Hong Kong Public Offering and the International
Offering being entered into and having become effective and unconditional (in
accordance with their respective original terms or as subsequently waived or varied by
agreement of the parties thereto) by no later than the time and date as specified in the
Underwriting Agreements, and neither of the aforesaid Underwriting Agreements having
been terminated;
(ii) the Offer Price having been agreed upon between our Company and the Sponsor-Overall
Coordiantor (for itself and on behalf of the Underwriters);
(iii) the Listing Committee having granted the approval for the listing of, and permission to
deal in, the H Shares (including the H Shares subscribed for by the Cornerstone
Investors) as well as other applicable waivers and approvals and such approval,
permission or waiver having not been revoked prior to the commencement of dealings in
the H Shares on the Stock Exchange; and
CORNERSTONE INVESTORS
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(iv) no laws shall have been enacted or promulgated which prohibits the consummation of
the transactions contemplated in the Global Offering or the respective Cornerstone
Investment Agreements, and there being no orders or injunctions from a court of
competent jurisdiction in effect precluding or prohibiting consummation of such
transactions; and the agreement, representations, warranties, undertakings, confirmations
and acknowledgements of the Cornerstone Investors under the respective Cornerstone
Investment Agreements are (as of the date of the respective Cornerstone Investment
Agreements) and will be (as of the Closing (as defined in the respective Cornerstone
Investment Agreements)) accurate and true in all respects and not misleading and that
there is no breach of the respective Cornerstone Investment Agreements on the part of
the relevant Cornerstone Investors.
RESTRICTIONS ON THE CORNERSTONE INVESTORS
Each of the Cornerstone Investors has agreed that without the prior written consent of our
Company, the Sole Sponsor and the Sponsor-Overall Coordinator, it will not, whether directly or
indirectly, at any time during the period of six months following the Listing Date (the “ Lock-up
Period ”), dispose of, in any way, any of the Offer Shares it has purchased, pursuant to the
respective Cornerstone Investment Agreement, save for certain limited circumstances, such as
transfers to any of its wholly-owned subsidiaries who will be bound by the same obligations of the
Cornerstone Investors, including the Lock-up Period restriction.
CORNERSTONE INVESTORS
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You should read the following discussion and analysis in conjunction with our
consolidated financial statements, included in the Accountants’ Report in Appendix I, together
with the respective accompanying notes. Our consolidated financial information has been
prepared in accordance with the IFRS Accounting Standards.
The following discussion and analysis contain forward-looking statements that reflect our
current views with respect to future events and financial performance. These statements are
based on our assumptions and analysis in light of our experience and perception of historical
trends, current conditions and expected future developments, as well as other factors we believe
are appropriate under the circumstances. However , our actual results may differ significantly
from those projected in the forward-looking statements. Factors that might cause future results
to differ significantly from those projected in the forward-looking statements include, but are
not limited to, those discussed in “Risk Factors” and “Forward-Looking Statements” and
elsewhere in this Prospectus.
OVERVIEW
We are a leading specialized PCB production equipment solution provider in China. We
operate in the specialized PCB equipment industry, serving as a key infrastructure provider for a
variety of downstream industries. With over 20 years of dedicated experience in the specialized
PCB equipment industry, we continuously research and develop technical processes in PCB
production.
According to CIC, we have an extensive product portfolio in the global specialized PCB
equipment industry, covering nearly all major PCB production processes such as drilling,
photolithography, lamination, formation and testing. We focus on improving the industry value
chain and providing comprehensive solutions with quality products to customers. Leveraging our
advanced R&D capabilities, comprehensive product matrix and stable customer relationships, we
have been consistently ranked first in terms of revenue for 16 consecutive years in the specialized
equipment and instrument list published by CPCA since 2009. According to CIC, we ranked first
in China in terms of revenue of specialized PCB production equipment in 2024, with a market
share of 10.1% in China. Our products have received wide customer recognition for their
performance and value.
Our revenue was RMB2,786.2 million, RMB1,634.3 million, RMB3,343.1 million,
RMB2,623.9 million and RMB4,314.1 million in 2022, 2023, 2024 and the ten months ended
October 31, 2024 and 2025, respectively. Our net profit was RMB432.0 million, RMB135.7
million, RMB299.6 million, RMB212.0 million and RMB518.9 million in 2022, 2023, 2024 and
the ten months ended October 31, 2024 and 2025, respectively.
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BASIS OF PRESENTATION
The consolidated statements of profit or loss, statements of comprehensive income,
statements of changes in equity and statements of cash flows of our Group for each of the years
and periods ended December 31, 2022, 2023, 2024 and the ten months ended October 31, 2024 and
2025, the consolidated statements of financial position of our Group as of December 31, 2022,
2023, 2024 and October 31, 2025, and material accounting policy information and other
explanatory information (together, the “ Historical Financial Information ”) have been prepared in
accordance with IFRS Accounting Standards (which include all International Financial Reporting
Standards, International Accounting Standards (“ IASs”) and Interpretations) as issued by the
International Accounting Standards Board (“ IASB”). All IFRS Accounting Standards effective for
the accounting period commencing from January 1, 2024, together with the relevant transitional
provisions, have been adopted by our Group in the preparation of the Historical Financial
Information throughout each of the years and periods ended December 31, 2022, 2023, 2024 and
the ten months ended October 31, 2024 and 2025.
The Historical Financial Information has been prepared under the historical cost convention,
except for certain portion of trade and bills receivable and financial liabilities at fair value through
profit or loss which has been measured at fair value.
The preparation of Historical Financial Information in conformity with IFRS Accounting
Standards requires the use of certain critical accounting estimates. It also requires management to
exercise its judgment in the process of applying our accounting policies. The areas involving a
higher degree of judgment or complexity, or areas where assumptions and estimates are significant
to the Historical Financial Information are disclosed in Note 3 of the Accountants’ Report in
Appendix I to this Prospectus.
New standards, amendments and interpretations to the existing standards that are effective
during the Track Record Period have been adopted by us consistently throughout the years and
periods presented, unless prohibited by the relevant standard to apply retrospectively.
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KEY FACTORS AFFECTING OUR RESULTS OF OPERATIONS
Our results of operations and financial condition have been, and will continue to be,
materially affected by a number of factors and developments, some of which are outside our
control, including:
General Factors
Our results of operations have been, and are expected to continue to be, materially affected
by a number of factors, many of which are beyond our control, including the following:
 development of macroeconomic conditions;
 technology development and competition in the specialized PCB equipment industry;
 government policies and regulations in relation to the PCB industry and the specialized
PCB production equipment industry;
 changes in international trade policies, geopolitics and trade protection measures, export
control and economic or trade sanctions; and
 weather, natural disasters and climate change.
Specific Factors
Demand for specialized PCB production equipment
Our business focuses on the R&D, production and sales of specialized PCB production
equipment, which are widely used in the production of PCBs. Accordingly, our business is affected
by changes in market demand for specialized PCB production equipment and for PCBs.
The decrease of our revenue from RMB2,786.2 million in 2022 to RMB1,634.3 million in
2023 was mainly due to a decline in industry output value of various sectors downstream of PCB
equipment, which led to reduced demand for PCBs, and, accordingly, PCB manufacturers’
decreased demand for specialized PCB production equipment. The increase in our revenue from
RMB1,634.3 million in 2023 to RMB3,343.1 million in 2024 as well as from RMB2,623.9 million
in the ten months ended October 31, 2024 to RMB4,314.1 million in the ten months ended October
31, 2025, was mainly attributable to the surge in demand for IT infrastructure in the AI industry
chain, coupled with the recovery of the consumer electronics sector and the technological upgrade
of automotive electronics, boosting demand for our specialized PCB production equipment.
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According to CIC, the global market size of specialized PCB equipment increased from
approximately US$5,840 million in 2020 to approximately US$7,085 million in 2024, representing
a CAGR of 4.9%, and is projected to reach approximately US$11,388 million at a CAGR of 8.6%
from 2025 to 2029. Meanwhile, our business remains affected by changes in market demand and
performance of PCB manufacturers. The growth in sectors such as server and data storage,
automotive electronics, mobile phones, computers and consumer electronics substantially
influences the demand for PCBs and related equipment.
Furthermore, in response to the growing demand from overseas markets, particularly
Southeast Asia, which has witnessed the global shift of the PCB industry to this region, we are
actively expanding and strengthening our presence internationally. During the Track Record
Period, our overseas revenue grew significantly from RMB36.4 million in 2022 to RMB84.9
million in 2023, and further to RMB361.9 million in 2024, and increased from RMB301.6 million
in the ten months ended October 31, 2024 to RMB552.3 million in the ten months ended October
31, 2025, representing 1.3%, 5.2%, 10.8% and 11.5% and 12.8% of our total revenue in the same
years/periods, respectively. As part of our strategy to integrate into the supply chain of leading
overseas substrate manufacturers and boost our brand recognition among prominent end-customers,
we have established a customer value-added service center in Thailand. Consequently, fluctuations
in demand in the overseas markets could also impact our business, financial condition and
operational results.
Our ability to control costs
The efficient management of costs is crucial to our ability to provide competitively priced
products. The majority of our cost of sales is raw materials and consumables used, which primarily
include standardized components, non-standard components and basic materials which can be used
for a wide range of equipment across different business segments. Raw materials and consumables
used accounted for the majority of our cost of sales, amounting to 89.2%, 85.8%, 90.2%, 89.6%
and 89.2% of our cost of sales in 2022, 2023, 2024 and the ten months ended October 31, 2024
and 2025, respectively. The supply and market prices of the raw materials remain subject to
various external factors beyond our control, such as supplier reliability, responsiveness, scale of
supply, and logistics and transportation efficiencies. To control costs, we have taken
comprehensive risk management strategies to mitigate the impact of any fluctuations in the prices
of raw materials and consumables used, including establishing long-term partnerships with
suppliers, adopting a one-time pricing model, sourcing key raw materials from multiple reliable
suppliers, and assessing alternative suppliers or sources for raw materials to ensure that we can
respond quickly to market demand and complete timely delivery of orders. In addition, we develop
new materials and engage new suppliers to allow flexibility in the event of severe shortages or
price volatility. We conduct regular reviews and implement internal mechanisms to monitor raw
material prices, taking into account current inventory levels, future sales, and market trends. Our
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multi-dimensional business synergies, including technological synergy, supply chain synergy and
customer synergy, also help to save costs. See “Business — Supply Chain Management — Our
Suppliers — Supplier Selection and Management.”
With the expansion of our business, enhancing operational efficiency and streamlining
production process are essential for managing production and operational costs. While we intend to
leverage economies of scale to reduce production costs, we have been actively optimizing
workflows and utilizing advanced technologies to improve productivity, thereby reducing overall
production costs. Furthermore, we invest in employee training and development to enhance skill
levels and operational effectiveness, improve utilization and cost efficiency of our production
workforce. During the Track Record Period, our manufacturing labor costs amounted to RMB52.7
million, RMB31.5 million, RMB68.7 million, RMB57.0 million and RMB93.8 million in 2022,
2023, 2024 and the ten months ended October 31, 2024 and 2025, respectively, accounting for
2.9%, 2.7%, 2.8%, 2.9% and 3.2% of our cost of sales in 2022, 2023, 2024 and the ten months
ended October 31, 2024 and 2025, respectively.
Product mix
The breadth and depth of our product mix enable us to offer our customers a variety of
options to meet their various needs. During the Track Record Period, we have consistently
diversified our product mix to form a comprehensive product matrix. In addition, leveraging our
extensive technological expertise and innovation in R&D, we are actively broadening our business
boundaries into new product categories. Our profitability has been and will continue to be affected
by our product mix. For example, during the Track Record Period, the gross profit margin of our
drilling equipment was 30.7%, 25.0%, 23.7%, 23.0% and 28.2% in 2022, 2023, 2024 and the ten
months ended October 31, 2024 and 2025, respectively. In 2023 and 2024, our sales of
new-generation drilling equipment increased. Such drilling equipment had relatively low gross
margins because, as it was still at early stage of commercialization, such drilling equipment had
yet to fully capitalize on economies of scale and therefore bore high manufacturing costs.
However, these products are strategically positioned to capture larger market share over the long
term, and we expect their gross profit margins to improve as we continue to reduce costs through
innovation, increase sales volume and achieve economies of scale. The increase in the gross profit
margin of our drilling equipment in the ten months ended October 31, 2025 is primarily
attributable to an increase in the proportion of sales of our high-precision drilling equipment,
which carries a relatively higher gross profit margin, which contributed to the overall improvement
in our gross profit margin for the period. We believe that the improvement and diversification of
our product mix result in more balanced growth of our business and revenue, and reduce the risk
of our dependence on any individual product type.
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Our ability to design, produce and market technologically advanced products
The specialized PCB production equipment that our customers require generally evolve over
time along with their changing preferences and needs. Therefore, our ability to design and develop
new products that meet these changing requirements has been and will continue to be critical to
our ability to cater to the diverse needs of our customers. We have invested in multiple product
centers responsible for product development. For example, in response to the trend of further
specialization in the specialized PCB equipment industry, we established the Lamination Product
Center, the Coating Tool Product Center and the Optical Inspection Product Center in 2023 to
supplement and strengthen our product R&D in the relevant fields. We maintain an R&D team of
871 employees, of which 74.5% held a bachelor’s degree or higher as of October 31, 2025. Our
investment in R&D enables us to design and develop more technologically advanced and
cost-competitive PCB production equipment. We believe the investment in R&D enables us to
achieve technological breakthroughs, which strengthen our competitive position as a leading
specialized PCB production equipment solution provider and enhance our ability to deliver
additional value to our customers. As a result, our ability to design, produce and market
technologically advanced products leads to our ability to attract and retain customers as well as
obtain orders, which in turn drives revenue growth and reinforces our market leadership.
Inventory management
Our inventories primarily consist of raw materials, semi-finished goods, work-in-progress,
materials consigned for processing, finished goods and goods in transit. We have implemented an
inventory control system that requires close internal coordination to ensure that our inventory
levels are sufficient to satisfy demand and not cause any disruptions in production while
minimizing carrying costs. As of December 31, 2022, 2023, 2024 and October 31, 2025, our
inventories were RMB903.9 million, RMB972.1 million, RMB898.2 million and RMB1,716.9
million, respectively. Overstocking can lead to excessive warehousing costs and potential
obsolescence, whereas understocking can disrupt production and delay delivery, negatively
impacting our ability to timely fulfill orders, which could negatively impact our future sales.
Therefore, we carefully manage and maintain inventory levels to support production effectively.
We analyze and determine the procurement strategies according to the forecast supply, market
analysis and the estimation of fluctuations in procurement period and procurement price. Based on
such analysis, we determine and maintain a reasonable and safe inventory level in response to
changes in customer demand and fluctuations of raw material prices.
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MATERIAL ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES AND
JUDGEMENTS
Revenue Recognition
Revenue from contracts with customers
Revenue from contracts with customers is recognized when control of goods or services is
transferred to the customers at an amount that reflects the consideration to which we expect to be
entitled in exchange for those goods or services.
When the consideration in a contract includes a variable amount, the amount of consideration
is estimated to which we will be entitled in exchange for transferring the goods or services to the
customer. The variable consideration is estimated at contract inception and constrained until it is
highly probable that a significant revenue reversal in the amount of cumulative revenue recognized
will not occur when the associated uncertainty with the variable consideration is subsequently
resolved.
When the contract contains a financing component which provides the customer with a
significant benefit of financing the transfer of goods or services to the customer for more than one
year, revenue is measured at the present value of the amount receivable, discounted using the
discount rate that would be reflected in a separate financing transaction between us and the
customer at contract inception. When the contract contains a financing component which provides
us with a significant financial benefit for more than one year, revenue recognized under the
contract includes the interest expense accreted on the contract liability under the effective interest
method. For a contract where the period between the payment by the customer and the transfer of
the promised goods or services is one year or less, the transaction price is not adjusted for the
effects of a significant financing component, using the practical expedient in IFRS 15.
(a) Sale of industrial products
Revenue from the sale of goods is recognized at the point in time when control of the goods
is transferred to the customer, which for domestic sales are generally at the time of the completion
of installation and commissioning of the goods or generally on delivery of the goods as agreed in
the sales contracts, and for overseas sales are generally at the time of shipment in accordance with
Incoterms.
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The periods and terms of product quality warranty are provided in accordance with the laws
and regulations related to the products. Our Group has not provided any additional services or
product quality warranty, so the product quality warranty does not constitute a separate
performance obligation.
(b) Provision of after-sales and processing services
Our Group provides after-sales services to customers, including repair and maintenance.
Revenue from after-sales services is recognized on a straight-line basis over the contract period.
Our Group also provides processing services. Revenue from after-sales services is recognized
when the services are rendered.
Revenue from other sources
Rental income
Rental income is recognized on a time proportion basis over the lease terms. Variable lease
payments that do not depend on an index or a rate are recognized as income in the accounting
period in which they are incurred.
Other income
Interest income is recognized on an accrual basis using the effective interest method by
applying the rate that exactly discounts the estimated future cash receipts over the expected life of
the financial instrument or a shorter period, when appropriate, to the net carrying amount of the
financial asset.
Investments and other financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortised
cost, fair value through other comprehensive income, and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial asset’s
contractual cash flow characteristics and our Group’s business model for managing them. With the
exception of trade receivables that do not contain a significant financing component or for which
our Group has applied the practical expedient of not adjusting the effect of a significant financing
component, our Group initially measures a financial asset at its fair value plus in the case of a
financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do
FINANCIAL INFORMATION
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not contain a significant financing component or for which our Group has applied the practical
expedient are measured at the transaction price determined under IFRS 15 in accordance with the
policies set out for revenue recognition above.
In order for a financial asset to be classified and measured at amortised cost or fair value
through other comprehensive income, it needs to give rise to cash flows that are solely payments
of principal and interest (“ SPPI”) on the principal amount outstanding. Financial assets with cash
flows that are not SPPI are classified and measured at fair value through profit or loss, irrespective
of the business model.
Our Group’s business model for managing financial assets refers to how we manage our
financial assets in order to generate cash flows. The business model determines whether cash flows
will result from collecting contractual cash flows, selling the financial assets, or both. Financial
assets classified and measured at amortised cost are held within a business model with the
objective to hold financial assets in order to collect contractual cash flows, while financial assets
classified and measured at fair value through other comprehensive income are held within a
business model with the objective of both holding to collect contractual cash flows and selling.
Financial assets which are not held within the aforementioned business models are classified and
measured at fair value through profit or loss.
Purchases or sales of financial assets that require delivery of assets within the period
generally established by regulation or convention in the marketplace are recognized on the trade
date, that is, the date that our Group commits to purchase or sell the asset.
Subsequent measurement
The subsequent measurement of financial assets depends on their classification as follows:
Financial assets at amortised cost (debt instruments)
Financial assets at amortised cost are subsequently measured using the effective interest
method and are subject to impairment. Gains and losses are recognized in the statement of profit
or loss when the asset is derecognised, modified or impaired.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are carried in the statement of financial
position at fair value with net changes in fair value recognized in the statement of profit or loss.
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Derecognition of financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar
financial assets) is primarily derecognised (i.e., removed from our Group’s consolidated statement
of financial position) when:
 the rights to receive cash flows from the asset have expired; or
 our Group has transferred our rights to receive cash flows from the asset or has assumed
an obligation to pay the received cash flows in full without material delay to a third
party under a “pass-through” arrangement; and either (a) our Group has transferred
substantially all the risks and rewards of the asset, or (b) our Group has neither
transferred nor retained substantially all the risks and rewards of the asset, but has
transferred control of the asset.
When our Group has transferred our rights to receive cash flows from an asset or has entered
into a pass-through arrangement, we evaluate if, and to what extent, we have retained the risk and
rewards of ownership of the asset. When we have neither transferred nor retained substantially all
the risks and rewards of the asset nor transferred control of the asset, our Group continues to
recognize the transferred asset to the extent of our Group’s continuing involvement. In that case,
our Group also recognizes an associated liability. The transferred asset and the associated liability
are measured on a basis that reflects the rights and obligations that our Group has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is
measured at the lower of the original carrying amount of the asset and the maximum amount of
consideration that our Group could be required to repay.
Impairment of financial assets
Our Group recognizes an allowance for expected credit losses (“ ECLs”) for all debt
instruments not held at fair value through profit or loss. ECLs are based on the difference between
the contractual cash flows due in accordance with the contract and all the cash flows that our
Group expects to receive, discounted at an approximation of the original effective interest rate.
The expected cash flows will include cash flows from the sale of collateral held or other credit
enhancements that are integral to the contractual terms.
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General approach
ECLs are recognized in two stages. For credit exposures for which there has not been a
significant increase in credit risk since initial recognition, ECLs are provided for credit losses that
result from default events that are possible within the next 12 months (a 12-month ECL). For those
credit exposures for which there has been a significant increase in credit risk since initial
recognition, a loss allowance is required for credit losses expected over the remaining life of the
exposure, irrespective of the timing of the default (a lifetime ECL).
At each reporting date, our Group assesses whether the credit risk on a financial instrument
has increased significantly since initial recognition. When making the assessment, our Group
compares the risk of a default occurring on the financial instrument as of the reporting date with
the risk of a default occurring on the financial instrument as of the date of initial recognition and
considers reasonable and supportable information that is available without undue cost or effort,
including historical and forward-looking information. Our Group considers that there has been a
significant increase in credit risk when contractual payments are more than 30 days past due.
Our Group considers a financial asset in default when contractual payments are 90 days past
due. However, in certain cases, our Group may also consider a financial asset to be in default
when internal or external information indicates that our Group is unlikely to receive the
outstanding contractual amounts in full before taking into account any credit enhancements held by
our Group.
A financial asset is written off when there is no reasonable expectation of recovering the
contractual cash flows.
Debt investments at fair value through other comprehensive income and financial assets at
amortised cost are subject to impairment under the general approach and they are classified within
the following stages for measurement of ECLs except for trade receivables and contract assets
which apply the simplified approach as detailed below.
S t a g e1—F i nancial instruments for which credit risk has not increased significantly since
initial recognition and for which the loss allowance is measured at an amount equal to 12-month
ECLs.
S t a g e2—F i nancial instruments for which credit risk has increased significantly since initial
recognition but that are not credit-impaired financial assets and for which the loss allowance is
measured at an amount equal to lifetime ECLs.
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S t a g e3—F i nancial assets that are credit-impaired at the reporting date (but that are not
purchased or originated credit-impaired) and for which the loss allowance is measured at an
amount equal to lifetime ECLs.
Simplified approach
For trade receivables and contract assets that do not contain a significant financing
component or when our Group applies the practical expedient of not adjusting the effect of a
significant financing component, our Group applies the simplified approach in calculating ECLs.
Under the simplified approach, our Group does not track changes in credit risk, but instead
recognises a loss allowance based on lifetime ECLs at each reporting date. Our Group has
established a provision matrix that is based on our historical credit loss experience, adjusted for
forward-looking factors specific to the debtors and the economic environment.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value
through profit or loss, loans and borrowings, payables, as appropriate.
All financial liabilities are recognized initially at fair value and, in the case of loans and
borrowings and payables, net of directly attributable transaction costs.
Our Group’s financial liabilities include trade and bills payables, other payables and accruals
and interest-bearing bank borrowings.
Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification as follows:
Financial liabilities at amortised cost (trade and bills payables, other payables and accruals and
interest-bearing bank borrowings)
After initial recognition, trade and bills payables, other payables and accruals, and
interest-bearing borrowings are subsequently measured at amortized cost, using the effective
interest rate method unless the effect of discounting would be immaterial, in which case they are
stated at cost. Gains and losses are recognized in the statement of profit or loss when the liabilities
are derecognized as well as through the effective interest rate amortization process.
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Amortized cost is calculated by taking into account any discount or premium on acquisition
and fees or costs that are an integral part of the effective interest rate. The effective interest rate
amortization is included in finance costs in the statement of profit or loss.
Financial guarantee contracts
Financial guarantee contracts issued by our Group are those contracts that require a payment
to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a
payment when due in accordance with the terms of a debt instrument. A financial guarantee
contract is recognized initially as a liability at its fair value, adjusted for transaction costs that are
directly attributable to the issuance of the guarantee. Subsequent to initial recognition, our Group
measures the financial guarantee contracts at the higher of: (i) the ECL allowance determined in
accordance with the policy as set out in “Impairment of financial assets”; and (ii) the amount
initially recognized less, when appropriate, the cumulative amount of income recognized.
Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or
cancelled, or expires.
When an existing financial liability is replaced by another from the same lender on
substantially different terms, or the terms of an existing liability are substantially modified, such
an exchange or modification is treated as a derecognition of the original liability and a recognition
of a new liability, and the difference between the respective carrying amounts is recognized in the
statement of profit or loss.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined on the
weighted average cost basis and, in the case of work in progress and finished goods, comprises
direct materials, direct labor and an appropriate proportion of overheads. Net realizable value is
based on estimated selling prices less any estimated costs to be incurred to completion and
disposal.
Provisions
A provision is recognized when a present obligation (legal or constructive) has arisen as a
result of a past event and it is probable that a future outflow of resources will be required to settle
the obligation, provided that a reliable estimate can be made of the amount of the obligation.
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When the effect of discounting is material, the amount recognized for a provision is the
present value at the end of the reporting periods of the future expenditures expected to be required
to settle the obligation. The increase in the discounted present value amount arising from the
passage of time is included in finance costs in the statement of profit or loss.
We provide for warranties in relation to the sale of certain industrial products for general
repairs of defects occurring during the warranty period. Provisions for these assurance-type
warranties granted by us are initially recognized based on sales volume and past experience of the
level of repairs and returns, discounted to their present values as appropriate. The warranty-related
cost is revised annually.
Business combinations and goodwill
Business combinations are accounted for using the acquisition method. The consideration
transferred is measured at the acquisition date fair value which is the sum of the acquisition date
fair values of assets transferred by our Group, liabilities assumed by our Group to the former
owners of the acquiree and the equity interests issued by our Group in exchange for control of the
acquiree. For each business combination, our Group elects whether to measure the non-controlling
interests in the acquiree at fair value or at the proportionate share of the acquiree’s identifiable net
assets. All other components of non-controlling interests are measured at fair value.
Acquisition-related costs are expensed as incurred.
Our Group determines that it has acquired a business when the acquired set of activities and
assets includes an input and a substantive process that together significantly contribute to the
ability to create outputs.
When our Group acquires a business, it assesses the financial assets and liabilities assumed
for appropriate classification and designation in accordance with the contractual terms, economic
circumstances and pertinent conditions as of the acquisition date. This includes the separation of
embedded derivatives in host contracts of the acquiree.
Any contingent consideration to be transferred by the acquirer is recognized at fair value at
the acquisition date. Contingent consideration classified as an asset or liability is measured at fair
value with changes in fair value recognized in profit or loss. Contingent consideration that is
classified as equity is not remeasured and subsequent settlement is accounted for within equity.
Goodwill is initially measured at cost, being the excess of the aggregate of the consideration
transferred, the amount recognized for non-controlling interests and any fair value of our Group’s
previously held equity interests in the acquiree over the identifiable assets acquired and liabilities
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assumed. If the sum of this consideration and other items is lower than the fair value of the net
assets acquired, the difference is, after reassessment, recognized in profit or loss as a gain on
bargain purchase.
After initial recognition, goodwill is measured at cost less any accumulated impairment
losses. Goodwill is tested for impairment annually or more frequently if events or changes in
circumstances indicate that the carrying value may be impaired. Our Group performs its annual
impairment test of goodwill as of December 31. For the purpose of impairment testing, goodwill
acquired in a business combination is, from the acquisition date, allocated to each of our Group’s
cash-generating units, or groups of cash-generating units, that are expected to benefit from the
synergies of the combination, irrespective of whether other assets or liabilities of our Group are
assigned to those units or groups of units.
Impairment is determined by assessing the recoverable amount of the cash-generating unit
(group of cash-generating units) to which the goodwill relates. Where the recoverable amount of
the cash-generating unit (group of cash-generating units) is less than the carrying amount, an
impairment loss is recognized. An impairment loss recognized for goodwill is not reversed in a
subsequent period.
Where goodwill has been allocated to a cash-generating unit (or group of cash-generating
units) and part of the operation within that unit is disposed of, the goodwill associated with the
operation disposed of is included in the carrying amount of the operation when determining the
gain or loss on the disposal. Goodwill disposed of in these circumstances is measured based on the
relative value of the operation disposed of and the portion of the cash-generating unit retained.
Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in
an orderly transaction between market participants at the measurement date. The fair value
measurement is based on the presumption that the transaction to sell the asset or transfer the
liability takes place either in the principal market for the asset or liability, or in the absence of a
principal market, in the most advantageous market for the asset or liability. The principal or the
most advantageous market must be accessible by the Group. The fair value of an asset or a
liability is measured using the assumptions that market participants would use when pricing the
asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s
ability to generate economic benefits by using the asset in its highest and best use or by selling it
to another market participant that would use the asset in its highest and best use.
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The Group uses valuation techniques that are appropriate in the circumstances and for which
sufficient data are available to measure fair value, maximising the use of relevant observable
inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the Historical
Financial Information are categorised within the fair value hierarchy, described as follows, based
on the lowest level input that is significant to the fair value measurement as a whole:
Level 1 — based on quoted prices (unadjusted) in active markets for identical assets or
liabilities
Level 2 — based on valuation techniques for which the lowest level input that is significant
to the fair value measurement is observable, either directly or indirectly
Level 3 — based on valuation techniques for which the lowest level input that is significant
to the fair value measurement is unobservable
For assets and liabilities that are recognized in the Historical Financial Information on a
recurring basis, the Group determines whether transfers have occurred between levels in the
hierarchy by reassessing categorization (based on the lowest level input that is significant to the
fair value measurement as a whole) at the end of each of the years and periods ended December
31, 2022, 2023 and 2024 and the ten months ended October 31, 2025.
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 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. The carrying amounts of goodwill at December 31,
2022, 2023, 2024 and October 31, 2025 were RMB12.9 million, RMB154.0 million, RMB74.3
million and RMB12.9 million, respectively.
Impairment testing 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
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present value of those cash flows. The carrying amounts of goodwill as of December 31, 2022,
2023 and 2024 and October 31, 2025 were RMB12,924,000, RMB153,963,000, RMB74,323,000
and RMB12,924,000, respectively.
Goodwill acquired through business combinations is allocated to the following
cash-generating units for impairment testing:
 Shenzhen Mason Electronics Co., Ltd. cash-generating unit;
 Advanced Intelligent Machine Co., Ltd. cash-generating unit; and
 Shenzhen Han’s Rayleigh Taide Precision Coating Co., Ltd. cash-generating unit.
The carrying amount of goodwill allocated to each of the cash-generating units is as follows:
As at December 31,
As of
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Mason CGU .................... 12,924 12,924 12,924 12,924
Advanced Intelligent CGU ......... ————
Rayleigh CGU ................... — 141,039 61,399 —
12,924 153,963 74,323 12,924
For the purpose of impairment review, the recoverable amount of a CGU is the higher of its
fair value less costs of disposal and its value in use. Assumptions were used in the calculation of
recoverable amounts of the Mason CGU and Rayleigh CGU. The following describes each key
assumption on which management has based its cash flow projections to undertake impairment
testing of goodwill:
Discount rates — The discount rates used are before tax for the recoverable amount
calculated based on value in use and after tax for the recoverable amount calculated based on fair
value less costs of disposal, respectively, and reflect specific risks relating to the relevant units.
Growth rates — The growth rates are determined based on historical experience and forecast
of market development in which the cash-generating unit operate in.
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Shenzhen Mason Electronics Co., Ltd. cash-generating unit (the “Mason CGU”)
Impairment reviews on the goodwill of Mason CGU have been conducted by the management
as of December 31, 2022, 2023 and 2024 according to IAS 36 “Impairment of assets.” As of
October 31, 2025, our management has considered and assessed all available internal and external
sources of information and has not identified any indications that an impairment loss of goodwill
may have occurred during the ten months ended October 31, 2025. Therefore the management did
not make a formal estimate of the recoverable amounts of Mason CGU as of October 31, 2025.
For the purposes of impairment review, the recoverable amount of the Mason CGU has been
determined based on a value in use calculation using cash flow projections based on financial
budgets covering a five-year period approved by the senior management. Based on the results of
the impairment assessments for goodwill of Mason CGU, headroom measured by the excess of the
recoverable amount over the carrying amount of Mason CGU as at December 31, 2022, 2023 and
2024 were RMB25,052,000, RMB24,845,000 and RMB42,118,000, respectively. As at December
31, 2022, 2023 and 2024, the pre-tax discount rate applied to the cash flow projections is 18.79%,
18.51% and 15.94%, respectively. The growth rate used to extrapolate the cash flows of the Mason
CGU beyond the five-year period is 2.00%, 2.00% and 2.00%, respectively.
For the sensitivity analysis conducted during the impairment review on the goodwill of
Mason CGU, had there been reasonably possible changes with an increase in pre-tax discount rate
by 1%, or with reduction of the growth rate used to extrapolate the cash flows of the Mason CGU
beyond the five-year period by 0.5%, it would cause the reduction of the recoverable amount of
Mason CGU as follows, if one of the key assumptions was to change while other variable held
constant: As at December 31, 2022, the recoverable amount would decrease by RMB14,100,000
and RMB1,300,000. As at December 31, 2023, the recoverable amount would decrease by
RMB16,300,000 and RMB1,500,000. As at December 31, 2024, the recoverable amount would
decrease by RMB18,500,000 and RMB1,500,000.
Advanced Intelligent Machine Co., Ltd. cash-generating unit (the “Advanced Intelligent CGU ”)
The carrying amount of the Advanced Intelligent CGU was fully impaired prior to the
beginning of the Track Record Period.
Shenzhen Han’s Rayleigh Taide Precision Coating Co., Ltd. cash-generating unit (the “Rayleigh
CGU”)
According to IAS 36 “Impairment of assets”, impairment reviews on the goodwill of
Rayleigh CGU have been conducted by management annually as at December 31, 2023 and 2024.
And due to the intense market competition during the second half of 2025, the business growth of
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Rayleign CGU was well below expectations thus there was an impairment indicator for the
goodwill of Rayleign CGU and impairment review has been conducted by management as at
October 31, 2025. As at December 31, 2023 and 2024, the recoverable amount of the Rayleigh
CGU has been determined based on the value in use which was the higher of fair value less costs
of disposal and value in use. The value in use calculation was determined using cash flow
projections based on financial budgets covering a five-year period approved by the senior
management. As at December 31, 2023 and 2024, the pre-tax discount rate applied to the cash flow
projections is 23.25% and 17.89%, respectively. As at October 31, 2025, the recoverable amount of
Rayleigh CGU has been determined based on the fair value less costs of disposal as it was higher
than the amount of value in use. The fair value less costs of disposal calculation was determined
using discounted cash flow projections of which the accuracy and reliability of the information is
reasonably assured by the appropriate budgeting, forecast and control process established by the
Group. The post-tax discount rate applied to the cash flow projections is 17.44%. The growth rate
used to extrapolate the cash flows of the Rayleigh CGU beyond the five-year period is 2.00%,
2.00% and 2.00%, respectively.
Based on the results of the impairment assessments, the recoverable amounts of the Rayleigh
CGU was RMB340,000,000, RMB99,820,000 and RMB5,228,000 as at December 31, 2023 and
2024 and October 31, 2025, respectively. Accordingly, the Group recognised an impairment
provision of approximately RMB79,640,000 for the year ended December 31, 2024 and
RMB61,399,000 for the ten months ended October 31, 2025 against the carrying amount of
goodwill relating to Rayleign CGU. The impairment for the year ended December 31, 2024 and the
ten months ended October 31, 2025 were attributable to the overall decline in forecasted revenue
generated by Rayleigh CGU in the cash flow projection prepared by the directors of the Group
with reference to the market activities of Rayleigh Taide.
Based on management’s assessment on the recoverable amounts, the headroom measured by
the excess of the recoverable amount over the carrying amount of Rayleigh CGU as at December
31, 2023 was RMB128,653,000. For the sensitivity analysis of Rayleigh conducted during the
impairment review, had there been reasonably possible changes with an increase in pre-tax
discount rate by 0.50%, or with reduction of the growth rate used to extrapolate the cash flows of
the Rayleigh CGU beyond the five-year period by 0.5%, it would cause the reduction of the
recoverable amount of Rayleigh CGU as follows, if one of the key assumptions was to change
while other variable held constant: As at December 31, 2023, the recoverable amount would
decrease by RMB8,000,000 and RMB3,000,000. As at December 31, 2024, the recoverable amount
would decrease by RMB4,386,000 and RMB1,211,000.
In the opinion of the directors of our Group, any reasonably possible change in the key
assumptions of the cash flow forecast would not cause its carrying amount of Rayleigh CGU
exceed its recoverable amount for the year ended December 31, 2023.
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Further details are given in note 18 to the Accountants’ Report in Appendix I to this
Prospectus.
Share-based payments
We operate a share-based payments scheme. Employees (including directors) of our Group
receive remuneration in the form of share-based payments, whereby employees render services in
exchange for equity instruments (the “ Equity-Settled Transactions ”). The cost of Equity-Settled
Transactions with employees is measured by reference to the fair value at the date at which they
are granted. The fair value is determined by an external valuer using a binomial model, further
details of which are given in note 36 to the Accountants’ Report in Appendix I to this Prospectus.
The cost of Equity-Settled Transactions is recognized in employee benefit expense, together
with a corresponding increase in equity, over the period in which the performance and/or service
conditions are fulfilled. The cumulative expense recognized for Equity-Settled Transactions at the
end of each reporting period until the vesting date reflects the extent to which the vesting period
has expired and our Group’s best estimate of the number of equity instruments that will ultimately
vest. The charge or credit to profit or loss for a period represents the movement in the cumulative
expense recognized as of the beginning and end of that period.
Service and non-market performance conditions are not taken into account when determining
the grant date fair value of awards, but the likelihood of the conditions being met is assessed as
part of our Group’s best estimate of the number of equity instruments that will ultimately vest.
Market performance conditions are reflected within the grant date fair value. Any other
conditions attached to an award, but without an associated service requirement, are considered to
be non-vesting conditions. Non-vesting conditions are reflected in the fair value of an award and
lead to an immediate expensing of an award unless there are also service and/or performance
conditions.
For awards that do not ultimately vest because non-market performance and/or service
conditions have not been met, no expense is recognized. Where awards include a market or
non-vesting condition, the transactions are treated as vesting irrespective of whether the market or
non-vesting condition is satisfied, provided that all other performance and/or service conditions are
satisfied.
Where the terms of an equity-settled award are modified, as a minimum an expense is
recognized as if the terms had not been modified, if the original terms of the award are met. In
addition, an expense is recognized for any modification that increased the total fair value of the
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share-based payments, or is otherwise beneficial to the employee as measured at the date of
modification. Where an equity-settled award is cancelled, it is treated as if it had vested on the
date of cancelation, and any expense not yet recognized for the award is recognized immediately.
The dilutive effect of outstanding options is reflected as additional share dilution in the
computation of earnings per share.
Current and deferred income tax
Income tax comprises current and deferred tax. Income tax relating to items recognized
outside profit or loss is recognized outside profit or loss, either in other comprehensive income or
directly in equity.
Current income tax
Current tax assets and liabilities are measured at the amount expected to be recovered from or
paid to the taxation authorities, based on tax rates (and tax laws) that have been enacted or
substantively enacted by the end of the reporting period, taking into consideration interpretations
and practices prevailing in the countries in which our Group operates.
Deferred income tax
Deferred tax is provided, using the liability method, on all temporary differences at the end
of the reporting period between the tax bases of assets and liabilities and their carrying amounts
for financial reporting purposes.
Deferred tax liabilities are recognized for all taxable temporary differences, except:
 when the deferred tax liability arises from the initial recognition of goodwill or an asset
or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss and does not
give rise to equal taxable and deductible temporary differences; and
 in respect of taxable temporary differences associated with investments in subsidiaries,
associates and joint ventures, when the timing of the reversal of the temporary
differences can be controlled and it is probable that the temporary differences will not
reverse in the foreseeable future.
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Deferred tax assets are recognized for all deductible temporary differences, and the carry
forward of unused tax credits and any unused tax losses. Deferred tax assets are recognized to the
extent that it is probable that taxable profit will be available against which the deductible
temporary differences, and the carry forward of unused tax credits and unused tax losses can be
utilized, except:
 when the deferred tax asset relating to the deductible temporary differences arises from
the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting profit nor
taxable profit or loss and does not give rise to equal taxable and deductible temporary
differences; and
 in respect of deductible temporary differences associated with investments in
subsidiaries and associates, deferred tax assets are only recognized to the extent that it
is probable that the temporary differences will reverse in the foreseeable future and
taxable profit will be available against which the temporary differences can be utilized.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period
and reduced to the extent that it is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax
assets are reassessed at the end of each reporting period and are recognized to the extent that it has
become probable that sufficient taxable profit will be available to allow all or part of the deferred
tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to
the period when the asset is realised or the liability is settled, based on tax rates (and tax laws)
that have been enacted or substantively enacted by the end of the reporting period.
Offsetting
Deferred tax assets and deferred tax liabilities are offset if and only if our Group has a
legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax
assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on
either the same taxable entity or different taxable entities which intend either to settle current tax
liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously,
in each future period in which significant amounts of deferred tax liabilities or assets are expected
to be settled or recovered.
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RESULTS OF OPERATIONS
The following table sets forth a summary of our consolidated results of operations for the
years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage of revenue)
(unaudited)
Revenue .............. 2,786,150 100.0 1,634,311 100.0 3,343,091 100.0 2,623,882 100.0 4,314,146 100.0
Cost of sales ............ (1,838,332) (66.0) (1,157,425) (70.8) (2,435,421) (72.8) (1,935,634) (73.8) (2,971,290) (68.9)
Gross profit ........... 947,818 34.0 476,886 29.2 907,670 27.2 688,248 26.2 1,342,856 31.1
Other income and gains, net ..... 184,681 6.6 127,799 7.8 192,013 5.7 89,257 3.4 131,358 3.0
Selling and marketing expenses ... (160,527) (5.8) (132,209) (8.1) (196,103) (5.9) (160,668) (6.1) (235,830) (5.5)
Administrative expenses ...... (153,653) (5.5) (112,515) (6.9) (203,743) (6.1) (154,874) (5.9) (218,396) (5.1)
Research and development expenses . (229,671) (8.2) (193,564) (11.8) (266,829) (8.0) (200,660) (7.6) (299,957) (7.0)
Impairment losses on financial assets
and contract assets under expected
credit loss model (“ ECL”), net .. (22,780) (0.8) (17,397) (1.1) (23,355) (0.7) (29,575) (1.1) (26,209) (0.6)
Other expenses ........... (3,977) (0.1) (10,621) (0.6) (83,175) (2.5) (5,457) (0.2) (96,009) (2.2)
Finance costs ........... (16,976) (0.6) (6,638) (0.4) (10,061) (0.3) (9,088) (0.3) (13,470) (0.3)
Impairment of an investment in an
associate ............. (55,768) (2.0) ————————
Share of profits and losses of
associates ............ (5,825) (0.2) 5,685 0.3 13,166 0.4 4,901 0.2 5,573 0.1
Profit before tax ......... 483,322 17.3 137,426 8.4 329,583 9.9 222,084 8.5 589,916 13.7
Income tax expense ......... (51,310) (1.8) (1,758) (0.1) (30,001) (0.9) (10,109) (0.4) (70,997) (1.6)
Profit for the year/period ..... 432,012 15.5 135,668 8.3 299,582 9.0 211,975 8.1 518,919 12.0
NON-IFRS MEASURE
To supplement our consolidated financial statements, which are presented in accordance with
IFRS Accounting Standards, we also use adjusted net profit (non-IFRS measure) as an additional
financial measure, which is not required by, or presented in accordance with IFRS Accounting
Standards. We believe this non-IFRS measure facilitates comparisons of operating performance
from year to year and period to period, as well as company to company by eliminating potential
impacts of certain items. We believe this measure provides useful information to investors and
others in understanding and evaluating our results of operations in the same manner as they help
our management. However, such non-IFRS measure we presented may not be directly comparable
FINANCIAL INFORMATION
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to similar measures presented by other companies. The use of this non-IFRS measure should not
be considered as a substitute for analysis of our results of operations or financial condition as
reported under IFRS Accounting Standards. In addition, the non-IFRS measure may be defined
differently from similar terms used by other companies, and may not be comparable to other
similarly titled measures used by other companies.
We define adjusted net profit (non-IFRS measure) as profit for the year/period adjusted by
adding back/subtracting share-based payment compensation and adding back listing expenses. The
following table reconciles our adjusted net profit (non-IFRS measure) presented in accordance with
IFRS Accounting Standards, which is profit for the year/period.
Year Ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Profit for the
year/period ........ 432,012 135,668 299,582 211,975 518,919
Adjusted by:
— Share-based
payment
compensation
(1) ... (10,260) 12,736 152,071 127,357 82,092
— Listing
expenses (2) ...... ———— 1 , 1 4 3
Adjusted net profit
(non-IFRS
measure) ......... 421,752 148,404 451,653 339,332 602,154
Notes:
(1) Share-based payment compensation is non-cash in nature and represent the arrangement under which we receive
services from employees as consideration for our equity instruments. Share-based payment compensation is not
expected to result in future cash payments.
(2) Listing expenses represent expenses incurred in connection with the Global Offering.
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DESCRIPTION OF MAJOR COMPONENTS OF OUR RESULTS OF OPERATIONS
Revenue
During the Track Record Period, our revenue is mainly derived from the sales of (i) drilling
equipment; (ii) photolithography equipment; (iii) testing equipment; (iv) formation equipment; (v)
attachment equipment; and (vi) lamination equipment. We experienced an overall revenue growth
during the Track Record Period. In 2022, 2023, 2024 and the ten months ended October 31, 2024
and 2025, our revenue was RMB2,786.2 million, RMB1,634.3 million, RMB3,343.1 million,
RMB2,623.9 million and RMB4,314.1 million, respectively.
Revenue by PCB production process
The following table sets forth a breakdown of our revenue from contracts with customers by
PCB production process for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Drilling equipment ......... 1,666,776 59.8 818,051 50.1 2,100,645 62.8 1,619,065 61.7 3,095,604 71.8
Photolithography equipment ..... 403,646 14.5 189,155 11.6 340,306 10.2 288,061 11.0 247,547 5.7
Testing equipment ......... 284,312 10.2 197,561 12.1 274,139 8.2 219,857 8.4 383,632 8.9
Formation equipment ........ 214,864 7.7 152,323 9.3 254,138 7.6 200,959 7.7 237,581 5.5
Attachment equipment ....... 23,603 0.8 54,778 3.4 81,940 2.5 64,796 2.5 95,437 2.2
Lamination equipment (1) ...... ———— 9,804 0.3 4,760 0.2 — —
Others (2) .............. 192,949 6.9 222,443 13.6 282,119 8.4 226,384 8.6 254,345 5.9
Total ............... 2,786,150 100.0 1,634,311 100.0 3,343,091 100.0 2,623,882 100.0 4,314,146 100.0
Notes:
(1) We began generating revenue from lamination equipment in 2024. However, in the ten months ended October 31,
2025, we did not record any revenue from lamination equipment, despite having received new orders and delivered
equipment during the period, which was primarily because the acceptance period of lamination equipment is
relatively long mainly attributable to the complex structure of the lamination equipment instead of any
quality-related issues, and no lamination equipment was accepted during such period. According to CIC, the
duration of the acceptance period for the lamination equipment is approximately six months.
(2) Others primarily include income from after-sales maintenance services, manufacturing services (mainly including
PCB testing and PCB profiling) provided to other companies and sales of spare parts, as well as rental income.
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Revenue by sales channel
The following table sets forth a breakdown of our revenue by contribution from our
customers for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except percentages)
(unaudited)
Direct customers (1) ......... 2,764,944 99.2 1,619,318 99.1 3,316,306 99.2 2,603,270 99.2 4,276,472 99.1
Distributorship ........... 21,206 0.8 14,993 0.9 26,785 0.8 20,612 0.8 37,674 0.9
Total ............... 2,786,150 100.0 1,634,311 100.0 3,343,091 100.0 2,623,882 100.0 4,314,146 100.0
Note:
(1) Direct customers refer to the end users of our products or services, engaging with us directly by themselves or
through sales agents.
Revenue by geographic location
The following table sets forth a breakdown of our revenue from contracts with customers by
geographic locations for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Mainland China .......... 2,749,760 98.7 1,549,406 94.8 2,981,171 89.2 2,322,285 88.5 3,761,835 87.2
Overseas (1) ............ 36,390 1.3 84,905 5.2 361,920 10.8 301,597 11.5 552,311 12.8
Total ............... 2,786,150 100.0 1,634,311 100.0 3,343,091 100.0 2,623,882 100.0 4,314,146 100.0
Note:
(1) Primarily include Thailand, Taiwan China, and Malaysia.
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We recorded revenue from mainland China and various overseas countries and regions.
Throughout the Track Record Period, our revenue generated from overseas as a percentage of total
revenue continued to increase, which was primarily driven by the increased demand from
Southeast Asia for specialized PCB processing equipment, as well as our strategic layout in
Southeast Asia.
Cost of Sales
Our cost of sales consists of raw materials and consumables used, manufacturing labor costs,
manufacturing overhead and write-down of inventories. Our cost of sales generally fluctuated in
line with our revenue. The following table sets forth our cost of sales by nature for the
years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Raw materials and consumables used . 1,639,895 89.2 993,168 85.8 2,196,570 90.2 1,734,512 89.6 2,650,062 89.2
Manufacturing labor costs ...... 52,739 2.9 31,534 2.7 68,662 2.8 56,989 2.9 93,839 3.2
Manufacturing overhead ....... 122,418 6.7 85,314 7.4 144,699 5.9 123,781 6.4 196,130 6.6
Write-down of inventories ...... 23,280 1.3 47,409 4.1 25,490 1.0 20,352 1.1 31,259 1.1
Total ............... 1,838,332 100.0 1,157,425 100.0 2,435,421 100.0 1,935,634 100.0 2,971,290 100.0
The following table sets forth our cost of sales by PCB production process for the
years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Drilling equipment ......... 1,155,614 62.9 613,564 53.0 1,602,710 65.8 1,246,912 64.4 2,223,897 74.8
Photolithography equipment ..... 226,301 12.3 122,169 10.6 221,969 9.1 192,523 9.9 151,861 5.1
Testing equipment ......... 176,996 9.6 125,422 10.8 162,034 6.7 127,574 6.6 227,227 7.6
Formation equipment ........ 176,587 9.6 121,176 10.5 201,621 8.3 162,929 8.4 176,601 5.9
Attachment equipment ....... 17,458 0.9 43,278 3.7 48,990 2.0 42,355 2.2 58,256 2.0
Lamination equipment ....... ———— 10,370 0.4 4,296 0.2 — —
Others ............... 85,376 4.6 131,816 11.4 187,727 7.7 159,045 8.3 133,448 4.5
Total ............... 1,838,332 100.0 1,157,425 100.0 2,435,421 100.0 1,935,634 100.0 2,971,290 100.0
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Gross Profit and Gross Profit Margin
Our gross profit was RMB947.8 million, RMB476.9 million, RMB907.7 million, RMB688.2
million and RMB1,342.9 million in 2022, 2023, 2024 and the ten months ended October 31, 2024
and 2025, respectively. Our gross profit margin was 34.0%, 29.2%, 27.2%, 26.2% and 31.1% in
2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, respectively. For details
on the changes in our gross profit and gross profit margin during the Track Record Period, see “—
Results of Operations.”
The following table sets forth a breakdown of our gross profit and gross profit margin by
PCB production process for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Gross profit
Gross profit
margin Gross profit
Gross profit
margin Gross profit
Gross profit
margin Gross profit
Gross profit
margin Gross profit
Gross profit
margin
(RMB in thousands, except for percentage)
(unaudited)
Drilling equipment ......... 511,162 30.7 204,487 25.0 497,935 23.7 372,153 23.0 871,707 28.2
Photolithography equipment ..... 177,345 43.9 66,986 35.4 118,337 34.8 95,538 33.2 95,686 38.7
Testing equipment ......... 107,316 37.7 72,139 36.5 112,105 40.9 92,283 42.0 156,405 40.8
Formation equipment ........ 38,277 17.8 31,147 20.4 52,517 20.7 38,030 18.9 60,980 25.7
Attachment equipment ....... 6,145 26.0 11,500 21.0 32,950 40.2 22,441 34.6 37,181 39.0
Lamination equipment ....... ———— (566) (5.8) 464 9.7 — —
Others ............... 107,573 55.8 90,627 40.7 94,392 33.5 67,339 29.7 120,897 47.5
Total ............... 947,818 34.0 476,886 29.2 907,670 27.2 688,248 26.2 1,342,856 31.1
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Administrative Expenses
Our administrative expenses include (i) employee expenses including salaries and share-based
compensation to our administrative staff; (ii) office and property related expenses; (iii)
depreciation and amortization expenses on the fixed assets, intangible assets, and right-of-use
assets; (iv) travel and business expenses; (v) intermediary fees in relations to consulting and legal
services; and (vi) others. In 2022, 2023, 2024 and the ten months ended October 31, 2024 and
2025, our administrative expenses amounted to RMB153.7 million, RMB112.5 million, RMB203.7
million, RMB154.9 million and RMB218.4 million, respectively. The following table sets forth a
breakdown of our administrative expenses by nature for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Employee expenses ......... 78,998 51.4 51,475 45.7 142,280 69.8 108,829 70.3 142,806 65.4
Office and property related expenses . 24,875 16.2 22,845 20.3 24,853 12.2 19,435 12.5 26,050 11.9
Depreciation and amortization
expenses ............. 29,221 19.0 23,427 20.8 21,486 10.5 17,147 11.1 26,918 12.3
Travel and business expenses .... 10,993 7.2 4,131 3.7 3,328 1.6 2,452 1.6 2,954 1.4
Intermediary fees .......... 2,856 1.9 5,281 4.7 4,533 2.2 2,265 1.5 10,315 4.7
Others (1) .............. 6,710 4.3 5,356 4.8 7,263 3.6 4,746 3.0 9,353 4.3
Total ............... 153,653 100.0 112,515 100.0 203,743 100.0 154,874 100.0 218,396 100.0
Note:
(1) Others primarily include bank fees and import and export handling fees.
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Selling and Marketing Expenses
Our selling and marketing expenses include (i) employee expenses including salaries and
share-based compensation to our selling and marketing staff; (ii) travel and business expenses; (iii)
sales service and agency fees; (iv) business promotion expenses; (v) short-term and low-value
asset lease expenses; (vi) depreciation and amortization expenses on fixed assets, intangible assets
and right-of-use assets related to our selling and marketing activities; and (vii) others. In 2022,
2023, 2024 and the ten months ended October 31, 2024 and 2025, our selling and marketing
expenses amounted to RMB160.5 million, RMB132.2 million, RMB196.1 million, RMB160.7
million and RMB235.8 million, respectively. The following table sets forth a breakdown of our
selling and marketing expenses by nature for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Employee expenses ........ 108,182 67.4 85,963 65.0 121,249 61.8 104,985 65.3 153,333 64.9
Travel and business expenses .... 30,322 18.9 25,875 19.6 39,059 19.9 28,526 17.8 47,123 20.0
Sales service and agency fees .... 13,759 8.6 9,283 7.0 20,371 10.4 13,358 8.3 9,836 4.2
Business promotion expenses .... 1,391 0.9 4,119 3.1 8,249 4.2 7,647 4.8 18,622 7.9
Short-term and low-value asset lease
expenses ............. 3,830 2.4 2,791 2.1 2,513 1.3 1,772 1.1 2,035 0.9
Depreciation and amortization
expenses ............ 1,264 0.8 1,414 1.1 1,454 0.7 1,268 0.8 1,316 0.6
Others ............... 1,779 1.0 2,764 2.1 3,208 1.7 3,112 1.9 3,565 1.5
Total ............... 160,527 100.0 132,209 100.0 196,103 100.0 160,668 100.0 235,830 100.0
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Research and Development Expenses
Our research and development expenses include (i) employee expenses including salaries and
share-based compensation to our research and development staff; (ii) material expenses; (iii)
depreciation and amortization expenses on our fixed assets, intangible assets and right-of-use
assets related to research and development activities; (iv) travel expenses; (v) short-term and
low-value asset lease expenses; and (vi) others. In 2022, 2023, 2024 and the ten months ended
October 31, 2024 and 2025, our research and development expenses amounted to RMB229.7
million, RMB193.6 million, RMB266.8 million, RMB200.7 million and RMB300.0 million,
respectively. The following table sets forth a breakdown of our research and development expenses
by nature for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Employee expenses ......... 177,991 77.5 132,272 68.3 203,695 76.3 150,583 75.0 244,259 81.4
Material expenses ......... 19,522 8.5 23,746 12.3 25,108 9.4 21,356 10.6 21,095 7.0
Depreciation and amortization
expenses ............. 14,065 6.1 17,579 9.1 16,220 6.1 13,215 6.6 15,436 5.1
Travel expenses .......... 5,083 2.2 6,265 3.2 10,291 3.9 6,465 3.2 9,219 3.1
Short-term and low-value asset lease
expenses ............. 3,196 1.4 2,914 1.5 2,114 0.8 1,805 0.9 2,079 0.7
Others ............... 9,814 4.3 10,788 5.6 9,401 3.5 7,236 3.7 7,869 2.7
Total ............... 229,671 100.0 193,564 100.0 266,829 100.0 200,660 100.0 299,957 100.0
Impairment Losses on Financial Assets and Contract Assets Under Expected Credit Loss
Model (“ECL”), Net
Our impairment losses on financial assets and contract assets under ECL, net, mainly include
impairment losses for movement in loss allowance for trade and bills receivables, and movement
in loss allowance for financial assets included in prepayments, other receivables and other assets.
In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, our impairment losses
on financial assets and contract assets under ECL, net, amounted to RMB22.8 million, RMB17.4
million, RMB23.4 million, RMB29.6 million and RMB26.2 million, respectively.
FINANCIAL INFORMATION
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Other Income and Gains, Net
Our other income and gains, net, include (i) government grants; (ii) bank interest income;
(iii) additional V AT deductions; (iv) foreign exchange differences, net; (v) gains/(losses) on
disposal of property, plant and equipment, right-of-use assets and other non-current asset; (vi) fair
value gains on financial liabilities at fair value through profit or loss; (vii) gain on remeasurement
of pre-existing interest in an associate; (viii) gains on derecognition of financial liabilities
measured at amortised cost; and (ix) others. In 2022, 2023, 2024 and the ten months ended
October 31, 2024 and 2025, our other income and gains, net amounted to RMB184.7 million,
RMB127.8 million, RMB192.0 million, RMB89.3 million and RMB131.4 million, respectively.
The following table sets forth a breakdown of our other income and gains, net, by nature for the
years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Other Income
Government grants ......... 139,883 75.7 64,471 50.4 60,043 31.3 47,661 53.4 50,680 38.6
Bank interest income ........ 40,719 22.1 40,832 32.0 20,699 10.8 17,017 19.1 33,312 25.4
Additional V AT deductions ..... — — 5,310 4.2 48,308 25.2 22,910 25.7 37,804 28.7
Total other income ........ 180,602 97.8 110,613 86.6 129,050 67.2 87,588 98.1 121,796 92.7
Other Gains, net
Foreign exchange differences, net .. 1,753 0.9 ————————
Gains/(losses) on disposal of
property, plant and equipment,
right-of-use assets and other
non-current asset ......... 775 0.4 207 0.2 (84) (0.0) (261) (0.3) (303) (0.2)
Fair value gains on financial
liabilities at fair value through
profit or loss ........... ———— 60,160 31.3 — — 8,523 6.5
Gain on remeasurement of
pre-existing interest in an
associate ............. — — 15,360 12.0 — — ————
Gains on derecognition of financial
liabilities measured at amortised
cost ............... 639 0.3 500 0.4 930 0.5 540 0.6 21 0.0
Others ............... 912 0.5 1,119 0.9 1,957 1.0 1,390 1.6 1,321 1.0
Total other gains ......... 4,079 2.2 17,186 13.4 62,963 32.8 1,669 1.9 9,562 7.3
Total other income and gains, net . 184,681 100.0 127,799 100.0 192,013 100.0 89,257 100.0 131,358 100.0
FINANCIAL INFORMATION
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Government grants mainly comprise incentives provided by local government authorities in
mainland China, including various forms of government financial incentives and awards to
facilitate technological innovation and expansion in production capacity (which are non-recurring
in nature), and tax rebate on certain of the software components within our products (which is
recurring in nature).
According to the regulations of Ministry of Finance and the State Administration of Taxation,
certain entities within our Group can enjoy an additional 5% deduction calculated based on the
input value-added tax (“ VAT”) from the V AT payable since January 1, 2023. The amount of
additional deduction was recognized in profit or loss when the entities declared and enjoyed the
preferential tax treatment.
Our fair value gains on financial liabilities at fair value through profit and loss in 2024 was
related to the acquisition of Rayleigh Taide in 2023. We sought to acquire Rayleigh Taide because
its core business, blade coating, is essential for the blades utilized in PCB manufacturing, and we
expected its integration to enhance our product offering, improve our product performance and
lifespan, and create synergistic effect that helps strengthen our position across the PCB production
value chain. In 2024, Rayleigh Taide experienced a decline in operational performance and
profitability as blade manufacturers started to move the coating process in-house, reducing the
demand for Rayleigh Taide’s coating services. Meanwhile, our anticipated synergies from the
acquisition did not materialize. After analyzing its operational performance and profitability, we
engaged a professional valuation agency to conduct a comprehensive review and impairment test
on the cash generating units, and made the necessary goodwill impairment provisions of RMB79.6
million. Accordingly, a reduction in consideration payable and recognition of fair value gains on
financial liabilities at fair value through profit or loss of RMB60.2 million were recognized in
2024. See “— Discussion of Certain Components of Consolidated Statements of Financial Position
— Liabilities from Contingent Consideration.”
FINANCIAL INFORMATION
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Other Expenses
Our other expenses consist of (i) foreign exchange differences, net; (ii) donations; (iii)
impairment of goodwill; (iv) compensation related to lease termination and fees associated with
withdrawing orders from suppliers; and (v) others. The following table sets forth a breakdown of
our other expenses by nature for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Foreign exchange differences, net .. — — 7,053 66.4 2,345 2.8 4,610 84.5 34,092 35.5
Donations ............. 3,000 75.4 — — 55 0.1 50 0.9 — —
Impairment of goodwill (1) ...... ———— 79,640 95.7 — — 61,399 64.0
Compensation (2) .......... 191 4.8 2,665 25.1 134 0.2 134 2.5 279 0.3
Others ............... 786 19.8 903 8.5 1,001 1.2 663 12.1 239 0.2
Total ............... 3,977 100.0 10,621 100.0 83,175 100.0 5,457 100.0 96,009 100.0
Notes:
(1) The impairment of goodwill represents the impairment of goodwill of Rayleigh Taide. In 2024, after analyzing its
operational performance and profitability, we engaged a professional valuation agency to conduct a comprehensive
review and impairment test on the cash-generating units, and made the necessary goodwill impairment provisions of
RMB79.6 million. See “— Discussion of Certain Components of Consolidated Statements of Financial Position —
Liabilities from Contingent Consideration” and “— Other Income and Gains, Net.”
(2) The increase in compensation in 2023 was primarily due to an increase in fees associated with lease termination
and withdrawing orders from suppliers, primarily as a result of changes in market conditions that affected our
demand.
FINANCIAL INFORMATION
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Finance Costs
Our finance costs consist of (i) interest on loans; (ii) interest expense on discounted bills; and
(iii) interest on lease liabilities. The following table sets forth a breakdown of our finance costs by
nature for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Interest on loans .......... 8,367 49.3 382 5.8 3,882 38.6 3,618 39.8 8,501 63.1
Interest expense on discounted bills . 2,199 13.0 1,467 22.1 3,138 31.2 2,964 32.6 3,436 25.5
Interest on lease liabilities ..... 6,410 37.8 4,789 72.1 3,041 30.2 2,506 27.6 1,533 11.4
Finance costs ........... 16,976 100.0 6,638 100.0 10,061 100.0 9,088 100.0 13,470 100.0
Impairment of an Investment in an Associate
Our impairment of an investment in an associate mainly represents the impairment on our
interests in our associate Shenzhen Mingxin Test Equipment Co., Ltd. (Shenzhen Mingxin), that
are accounted for using the equity method. In 2022, our impairment of an investment in an
associate amounted to RMB55.8 million, primarily due to a decrease in Shenzhen Mingxin’s
performance resulting from the downstream market conditions.
Share of Profits and Losses of Associates
Our share of profits and losses of associates mainly include our interests in associates that are
accounted for using the equity method. In 2022, our share in losses of associates amounted to
RMB5.8 million. In 2023 and 2024, our share of profits of associates amounted to RMB5.7 million
and RMB13.2 million, respectively. In the ten months ended October 31, 2024 and 2025, our share
of profit of associates amounted to RMB4.9 million and RMB5.6 million, respectively.
FINANCIAL INFORMATION
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Income Tax Expenses
Our income tax expenses comprise current income tax and deferred income tax. In 2022,
2023, 2024 and the ten months ended October 31, 2024 and 2025, our income tax expenses
amounted to RMB51.3 million, RMB1.8 million, RMB30.0 million, RMB10.1 million and
RMB71.0 million, respectively. The following table sets forth a breakdown of our income tax
expenses by nature for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Current income tax ......... 65,817 128.3 9,181 522.2 12,878 42.9 14,646 144.9 110,167 155.2
Deferred income tax ........ (14,507) (28.3) (7,423) (422.2) 17,123 57.1 (4,537) (44.9) (39,170) (55.2)
Total ............... 51,310 100.0 1,758 100.0 30,001 100.0 10,109 100.0 70,997 100.0
We are subject to income tax on an entity basis on profits arising in or derived from the
jurisdictions in which members of us are domiciled and operate.
PRC Corporate Income Tax
Under the Law of the PRC on Enterprise Income Tax (the “ EIT Law ”) and Implementation
Regulation of the EIT Law, the EIT rate of the PRC subsidiaries is 25% during 2022, 2023 and
2024 and the ten months ended October 31, 2024 and 2025 unless subject to tax concession set out
below.
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 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. Our
Company, Shenzhen Mason Electronics Co., Ltd. and Advanced Intelligent Machine Co., Ltd. are
subject to a preferential income tax rate of 15% from 2022 to 2025. Shenzhen Han’s Rayleigh
Taide Precision Coating Co., Ltd. was subject to a preferential income tax rate of 15% from 2024
to 2026.
FINANCIAL INFORMATION
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--- page 364 ---
Pursuant to the Circular of Extending the Period of Western Development Strategies
Preferential Tax Rate (circular of the Ministry of Finance, State Taxation Administration and
National Development and Reform Commission [2020] No. 23), from January 1, 2021 to
December 31, 2030, enterprises located in western China that are engaged in encouraged industries
shall be subject to a reduced enterprise income tax at a tax rate of 15%. The enterprises in the
encouraged industries shall mainly engage in the industries set out in the Catalog of Encouraged
Industries in Western China, and the revenue from the main business of such enterprises shall
exceed 60% of the total revenue. Han’s CNC Technology (Xinfeng) Co., Ltd. operated in western
China are subject to a preferential income tax rate of 15% from 2022 to 2025. Mason Electronics
(Xinfeng) Co., Ltd. was subject to a preferential income tax rate of 15% from 2024 to 2025.
Pursuant to the Corporate Income Tax Law of the People’s Republic of China and its
Implementation Regulations, for the period from January 1, 2021 to December 31, 2022, small and
low-profit enterprises were subject to a reduced effective corporate income tax rate of 2.5% on the
portion of their annual taxable income not exceeding RMB1,000,000; effective January 1, 2023
through December 31, 2027, this reduced rate on tax income up to RMB1,000,000 is 5%;
concurrently, for the period spanning January 1, 2022 to December 31, 2027, the portion of annual
taxable income between RMB1,000,000 and RMB3,000,000 (inclusive) for such enterprises is
subject to corporate income tax at a reduced effective rate of 5%. Suzhou Mason Electronics
Testing Co., Ltd., Dongguan Han’s CNC Technology Co., Ltd., Shenzhen Han’s Microelectronics
Technology Co., Ltd. and Shanghai Han’s Machinery Co., Ltd., meet the criteria for small and
low-profit enterprises and thus enjoy the aforementioned corporate income tax incentives.
Additional deduction for research and development expense
Additional deductible allowance was for qualified research and development costs. According
to the relevant laws and regulations promulgated by the State Taxation Administration of the PRC
enterprises engaging in research and development activities are entitled to claim 200% of their
research and development costs so incurred as tax deductible expenses when determining their
assessable profits during 2022, 2023 and 2024 and the ten months ended October 31, 2024 and
2025. Pursuant to the Corporate Income Tax Law of the People’s Republic of China and its
Implementation Regulations, qualified industrial machine tool enterprises are eligible for the new
R&D super deduction. An extra 120% of the amount of R&D actually incurred during the period
from January 1, 2023 to December 31, 2027 is deductible before tax payment, in addition to the
deduction of actual expenses as prescribed, provided that the said expenses are not recognized as
intangible asset and included in the current profits and losses; if the said expenses have been
recognized as an intangible asset, such expenses may be amortized at the rate of 220% of the costs
of the intangible assets before tax payment in the above period. The Company, Shenzhen Mason
Electronics Co., Ltd. and Advnced Intelligent Machine Co., Ltd. benefitted from this tax incentive
in 2023, 2024 and 2025.
FINANCIAL INFORMATION
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--- page 365 ---
Hong Kong Corporate Income Tax
The subsidiary incorporated in Hong Kong is subject to Hong Kong profits tax at the rate of
16.5% on the estimated assessable profits arising in Hong Kong. No provision for Hong Kong
profits tax has been made as our Group had no assessable profits derived from or earned in Hong
Kong during the Track Record Period.
Thailand and Singapore Corporate Income Tax
No provision for profits tax in Thailand and Singapore was made as we did not have any
assessable income subject to profits tax in Thailand and Singapore during 2022, 2023, 2024 and
the ten months ended October 31, 2024 and 2025.
RESULTS OF OPERATIONS
Ten months ended October 31, 2025 compared with Ten months ended October 31, 2024
Revenue
Our revenue increased by 64.4% from RMB2,623.9 million in the ten months ended October
31, 2024 to RMB4,314.1 million in the ten months ended October 31, 2025, primarily due to (i)
the surge in demand for IT infrastructure in the AI industry chain; and (ii) the recovery of the
consumer electronics sector and the technological upgrade of automotive electronics. Specifically:
 Our revenue from drilling equipment increased by 91.2% from RMB1,619.1 million in
the ten months ended October 31, 2024 to RMB3,095.6 million in the ten months ended
October 31, 2025, primarily due to (i) an increase in sales volume from 2,569 units in
the ten months ended October 31, 2024 to 4,499 units in the ten months ended October
31, 2025, driven by (a) the structural growth in demand in downstream application
markets of AI servers and automotive electronics; (b) technological upgrades which
enabled our products to penetrate into high-end markets; and (c) an increase in our sales
of laser drilling machines with multi-terminal applications of smart phones, automotive
electronics, and consumer electronics that significantly generated demand for our
products; and (ii) an increase in the average selling price, resulting from an increase in
the proportion of sales of our high-precision drilling equipment, which carries a
relatively higher gross profit margin.
FINANCIAL INFORMATION
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--- page 366 ---
 Our revenue from photolithography equipment decreased by 14.1% from RMB288.1
million in the ten months ended October 31, 2024 to RMB247.5 million in the ten
months ended October 31, 2025, primarily due to a decrease in sales volume from 119
units in the ten months ended October 31, 2024 to 103 units in the ten months ended
October 31, 2025, primarily attributable to a shift in market dynamics, particularly
among leading PCB manufacturers. In the ten months ended October 31, 2025, market
demand for high-end photolithography equipment, particularly high-precision and
large-format models that typically command higher selling prices, increased
significantly. Conversely, demand for lower-end equipment among downstream
customers contracted during the same period. Even though we achieved certain
improvement in upgrading our photolithography equipment, as demonstrated by an
increase in gross profit margin of our photolithography equipment from 33.2% in the ten
months ended October 31, 2024 to 38.7% in the ten months ended October 31, 2025, we
were still in the process of upgrading our production capabilities to respond to the above
trend, we did not fully capture the growth in demand for high-end photolithography
equipment while the addressable market for lower-end equipment decreased. As a result,
we experienced the above decline in revenue from photolithography equipment.
To address these market dynamics, we are actively optimizing our sales strategies and
upgrading our product portfolio. We have accelerated the development and
commercialization of high-end photolithography equipment, including high-precision,
solder mask, and large-format models. As of the date of this prospectus, we have
successfully completed technical validation with certain leading customers and secured
corresponding sales orders for high-end photolithography equipment. With continued
efforts in product upgrade and business development, we expect subsequent sales
performance of photolithography equipment to achieve sustainable growth in the near
future.
 Our revenue from testing equipment increased by 74.5% from RMB219.9 million in the
ten months ended October 31, 2024 to RMB383.6 million in the ten months ended
October 31, 2025, primarily due to (i) an increase in sales volume from 359 units in the
ten months ended October 31, 2024 to 501 units in the ten months ended October 31,
2025, driven by the structural growth in testing demand in downstream application
markets of AI servers, consumer electronics and automotive electronics; and (ii) an
increase in the average selling price, as a result of the increase in sales of high-precision
testing equipment.
FINANCIAL INFORMATION
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--- page 367 ---
 Our revenue from formation equipment increased by 18.2% from RMB201.0 million in
the ten months ended October 31, 2024 to RMB237.6 million in the ten months ended
October 31, 2025, primarily due to an increase in sales volume from 477 units in the ten
months ended October 31, 2024 to 521 units in the ten months ended October 31, 2025,
driven by the structural growth in demand in downstream application markets of AI
servers, consumer electronic and automotive electronics. Meanwhile, the average selling
price of our formation equipment remained stable during the same periods.
 Our revenue from attachment equipment increased by 47.3% from RMB64.8 million in
the ten months ended October 31, 2024 to RMB95.4 million in the ten months ended
October 31, 2025, primarily due to (i) an increase in sales volume of attachment
equipment from 168 units in the ten months ended October 31, 2024 to 208 units in the
ten months ended October 31, 2025, driven by the structural growth in the downstream
application markets; and (ii) an increase in average selling price for our attachment
equipment due to the increase in sales of more advanced models of attachment
equipment in the ten months ended October 31, 2025.
 We did not record any revenue from lamination equipment in the ten months ended
October 31, 2025, despite having received new orders and delivered equipment during
the period, primarily because the acceptance period of lamination equipment is
relatively long, and no lamination equipment was accepted during such period.
 Our revenue from others increased by 12.4% from RMB226.4 million in the ten months
ended October 31, 2024 to RMB254.3 million in the ten months ended October 31,
2025, primarily due to an increase in maintenance work driven by the continuous
increase in accumulated equipment sales.
Cost of Sales
Our cost of sales increased by 53.5% from RMB1,935.6 million in the ten months ended
October 31, 2024 to RMB2,971.3 million in the ten months ended October 31, 2025, primarily due
to an increase in the raw materials and consumables used, which was generally in line with our
growth in revenue.
FINANCIAL INFORMATION
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--- page 368 ---
Gross Profit and Gross Profit Margin
As a result of the foregoing, our gross profit increased by 95.1% from RMB688.2 million in
the ten months ended October 31, 2024 to RMB1,342.9 million in the ten months ended October
31, 2025. Our gross profit margin increased from 26.2% in the ten months ended October 31, 2024
to 31.1% in the ten months ended October 31, 2025, primarily due to an increase in the gross
profit margin of our drilling equipment.
 The gross profit of our drilling equipment increased from RMB372.2 million in the ten
months ended October 31, 2024 to RMB871.7 million in the ten months ended October
31, 2025. The gross profit margin of our drilling equipment increased from 23.0% in the
ten months ended October 31, 2024 to 28.2% in the ten months ended October 31, 2025
primarily due to an increase in the proportion of sales of our high-precision drilling
equipment, which carries a relatively higher gross profit margin.
 The gross profit of our photolithography equipment increased from RMB95.5 million in
the ten months ended October 31, 2024 to RMB95.7 million in the ten months ended
October 31, 2025. The gross profit margin of our photolithography equipment increased
from 33.2% in the ten months ended October 31, 2024 to 38.7% in the ten months ended
October 31, 2025 primarily due to the increased proportion of sales of models of
relatively higher gross profit margin.
 The gross profit of our testing equipment increased from RMB92.3 million in the ten
months ended October 31, 2024 to RMB156.4 million in the ten months ended October
31, 2025. The gross profit margin of our testing equipment remained relatively stable at
42.0% and 40.8% in the ten months ended October 31, 2024 and 2025, respectively.
 The gross profit of our formation equipment increased from RMB38.0 million in the ten
months ended October 31, 2024 to RMB61.0 million in the ten months ended October
31, 2025. The gross profit margin of our formation equipment increased from 18.9% in
the ten months ended October 31, 2024 to 25.7% in the ten months ended October 31,
2025 primarily due to an increase in sales of our high-precision formation equipment,
which carries a relatively higher gross profit margin.
 The gross profit of our attachment equipment increased from RMB22.4 million in the
ten months ended October 31, 2024 to RMB37.2 million in the ten months ended
October 31, 2025. The gross profit margin of our attachment equipment increased from
34.6% in the ten months ended October 31, 2024 to 39.0% in the ten months ended
October 31, 2025 primarily due to the increase in sales of more advanced models of
attachment equipment, which are of relatively higher gross profit margin.
FINANCIAL INFORMATION
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--- page 369 ---
 The gross profit of others increased from RMB67.3 million in the ten months ended
October 31, 2024 to RMB120.9 million in the ten months ended October 31, 2025. The
gross profit margin of others increased from 29.7% in the ten months ended October 31,
2024 to 47.5% in the ten months ended October 31, 2025, primarily due to our improved
management of maintenance services. We strengthened preventive maintenance for our
equipment, which resulted in fewer equipment failures and reduced the costs associated
with providing maintenance services.
Other Income and Gains, Net
Our other income and gains, net increased by 47.1% from RMB89.3 million in the ten months
ended October 31, 2024 to RMB131.4 million in the ten months ended October 31, 2025, primarily
due to (i) an increase in government grants that primarily aim to encourage technological
advancement, industrial growth, and operational stability; and (ii) an increase in the additional
V AT deduction, primarily due to our increased procurement amounts in light of our increased sales
in the ten months ended October 31, 2025, which resulted in a greater amount of input V AT
eligible for the additional V AT deduction.
Administrative Expenses
Our administrative expenses increased by 41.0% from RMB154.9 million in the ten months
ended October 31, 2024 to RMB218.4 million in the ten months ended October 31, 2025, primarily
due to (i) an increase in employee expense, primarily resulting from an expansion of our
administrative personnel and an increase in performance-based compensation of our administrative
personnel; (ii) an increase in intermediary fees, primarily related to the professorial fees in
connection with the consultants we engaged to enhance our management structure and capabilities
and in connection with the Global Offering; and (iii) an increase in office and property related
expenses, primarily due to our business growth.
Selling and Distribution Expenses
Our selling and distribution expenses increased by 46.7% from RMB160.7 million in the ten
months ended October 31, 2024 to RMB235.8 million in the ten months ended October 31, 2025,
primarily as a result of (i) an increase in employee expenses of sales staff, primarily due to an
expansion of our sales personnel and an increase in performance-based compensation of our sales
personnel; and (ii) an increase in travel and business expenses, driven by our expanding business
scale.
FINANCIAL INFORMATION
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--- page 370 ---
Research and Development Expenses
Our research and development expenses increased by 49.5% from RMB200.7 million in the
ten months ended October 31, 2024 to RMB300.0 million in the ten months ended October 31,
2025, primarily due to (i) an increase in employee expenses of the research and development staff,
primarily due to an expansion of our sales personnel and an increase in performance-based
compensation of our research and development personnel; and (ii) an increase in material
expenses, primarily due to the development of new products, which required use of materials for
related research and testing activities.
Impairment Losses on Financial Assets and Contract Assets under ECL, Net
Our impairment losses on financial assets and contract assets under ECL, net decreased from
RMB29.6 million in the ten months ended October 31, 2024 to RMB26.2 million in the ten months
ended October 31, 2025, primarily due to a reassessment of customer creditworthiness based on
current circumstances and historical payment records.
Other Expenses
Our other expenses increased from RMB5.5 million in the ten months ended October 31,
2024 to RMB96.0 million in the ten months ended October 31, 2025, primarily due to an increase
in foreign exchange differences, net, primarily as a result of foreign exchange loss.
Profit for the Period
As a result of the foregoing, our net profit increased by 144.8% from RMB212.0 million in
the ten months ended October 31, 2024 to RMB518.9 million in the ten months ended October 31,
2025.
FINANCIAL INFORMATION
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--- page 371 ---
Comparisons Between Years Ended December 31, 2024 and 2023
Revenue
Our revenue increased by 104.6% from RMB1,634.3 million in 2023 to RMB3,343.1 million
in 2024, primarily due to an increase in demand for our specialized PCB production equipment
driven by (i) the surge in demand for IT infrastructure in the AI industry chain; and (ii) the
recovery of the consumer electronics sector and the technological upgrade of automotive
electronics. Specifically:
 Our revenue from drilling equipment increased by 156.8% from RMB818.1 million in
2023 to RMB2,100.6 million in 2024, primarily due to an increase in sales volume from
1,129 units in 2023 to 3,119 units in 2024, driven by (i) the structural growth in demand
in downstream application markets of AI servers and automotive electronics; (ii)
technological upgrades which enabled our products to penetrate into high-end markets,
such as the mass production of our twelve-axis automatic mechanical drilling machines
in 2024; and (iii) an increase in our sales of laser drilling machines in the HDI board
market segment, with multi-terminal applications of smart phones, automotive
electronics, and consumer electronics that significantly generated demand for our
products, offset by a decrease in the average selling price of our drilling equipment,
driven by our strategies to enhance market penetration.
 Our revenue from photolithography equipment increased by 79.9% from RMB189.2
million in 2023 to RMB340.3 million in 2024, primarily due to an increase in sales
volume from 79 units in 2023 to 141 units in 2024, driven by the structural growth in
demand in downstream application markets, particularly in sectors such as servers and
data storage for AI infrastructure, as well as consumer electronics, such as personal
computers and smartphones.
 Our revenue from testing equipment increased by 38.7% from RMB197.6 million in
2023 to RMB274.1 million in 2024, primarily due to (i) an increase in sales volume
from 400 units in 2023 to 446 units in 2024, driven by the structural growth in testing
demand in downstream application markets of AI servers and optical modules; and (ii)
an increase in sales of new-generation testing equipment products resulting from the
increase in downstream customers’ investment in new production lines and the mass
production of our newly developed testing equipment, which offer higher precision and
meet more customer needs, and therefore led to more premium pricing.
FINANCIAL INFORMATION
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--- page 372 ---
 Our revenue from formation equipment increased by 66.8% from RMB152.3 million in
2023 to RMB254.1 million in 2024, primarily due to an increase in sales volume from
289 units in 2023 to 596 units in 2024, driven by the structural growth in the multi-layer
and HDI PCB sectors, partially offset by a decrease in average selling price of our
formation equipment due to an increase in sales of mechanical formation equipment
which typically has lower gross profit margins.
 Our revenue from attachment equipment increased by 49.5% from RMB54.8 million in
2023 to RMB81.9 million in 2024, primarily due to (i) an increase in sales volume of
attachment equipment from 183 units in 2023 to 206 units in 2024, driven by the
structural growth in the downstream application markets; and (ii) an increase in average
selling price for our attachment equipment due to the more advanced product
specifications of the attachment equipment sold in 2024 than those sold in 2023. Such
attachment equipment offers enhancements over previously sold models, including the
ability to accommodate larger workpieces, deliver higher processing efficiency and
precision, and handle a wider range of materials, thereby providing greater value to
customers and generally selling at higher prices over previous models.
 We started to generate revenue from lamination equipment in 2024, with sale of two
units in 2024. In 2024, we had revenue from lamination equipment of RMB9.8 million.
 Our revenue from others increased by 26.8% from RMB222.4 million in 2023 to
RMB282.1 million in 2024, primarily as a result of an increase in maintenance work
driven by the continuous increase in accumulated equipment sales.
Cost of Sales
Our cost of sales increased by 110.4% from RMB1,157.4 million in 2023 to RMB2,435.4
million in 2024, primarily due to an increase in the raw materials and consumables used, which
was generally in line with our growth in revenue.
FINANCIAL INFORMATION
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--- page 373 ---
Gross profit and gross profit margin
As a result of the foregoing, our gross profit increased by 90.3% from RMB476.9 million in
2023 to RMB907.7 million in 2024. Our gross profit margin slightly decreased from 29.2% in
2023 to 27.2% in 2024, primarily due to a decrease in the gross profit margin of our drilling
equipment.
 The gross profit of our drilling equipment increased from RMB204.5 million in 2023 to
RMB497.9 million in 2024. The gross profit margin of our drilling equipment decreased
from 25.0% in 2023 to 23.7% in 2024, mainly due to an increase in sales of
new-generation drilling equipment, which typically has a lower gross profit margin
because at its early stage of commercialization, it had yet to fully capitalize on
economies of scale and therefore bore high manufacturing costs. In addition, we
downward adjusted the average selling price of our drilling equipment as a part of our
efforts to enhance market penetration.
 The gross profit of our photolithography equipment increased from RMB67.0 million in
2023 to RMB118.3 million in 2024. The gross profit margin of our photolithography
equipment remained relatively stable at 35.4% in 2023 and 34.8% in 2024.
 The gross profit of our testing equipment increased from RMB72.1 million in 2023 to
RMB112.1 million in 2024. The gross profit margin of our testing equipment increased
from 36.5% in 2023 to 40.9% in 2024, primarily due to an increase in sales of
new-generation testing equipment products resulting from the increase in downstream
customers’ investment in new production lines and the mass production of our newly
developed testing equipment, which offer higher precision and meet more customer
needs, and therefore led to more premium pricing.
 The gross profit of our formation equipment increased from RMB31.1 million in 2023
to RMB52.5 million in 2024. The gross profit margin of our formation equipment
remained relatively stable at 20.4% in 2023 and 20.7% in 2024.
 The gross profit of our attachment equipment increased from RMB11.5 million in 2023
to RMB33.0 million in 2024. The gross profit margin of our attachment equipment
increased from 21.0% in 2023 to 40.2% in 2024, mainly due to an increase in our ability
to charge premium pricing for our wider range of attachment equipment products as
customers recognize the value of such products.
FINANCIAL INFORMATION
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--- page 374 ---
 The gross loss of our lamination equipment was RMB0.6 million in 2024. We incurred
gross loss margin of 5.8% for our lamination equipment in 2024, which was mainly
because our lamination equipment was at its early stage of commercialization, and had
yet to fully capitalize on economies of scale and therefore bore high manufacturing
costs.
 The gross profit of others increased from RMB90.6 million in 2023 to RMB94.4 million
in 2024. The gross profit margin of others decreased from 40.7% in 2023 to 33.5% in
2024, primarily due to our implementation of strategic measures on after-sales
maintenance services to stimulate sales in light of the the inactive downstream markets
in 2023, which include the expansion of maintenance service scope and competitive
contract pricing. Such initiatives resulted in an increased proportion of contracts
including lower margin after-sales maintenance services in 2024, and diluted the overall
profitability of others.
Other Income and Gains, Net
Our other income and gains, net increased by 50.2% from RMB127.8 million in 2023 to
RMB192.0 million in 2024, mainly due to (i) an increase in additional V AT deductions which
became available under the new government policy in 2023. We became eligible for the V AT
deductions in the second half of 2023. As we did not have sufficient output V AT to fully utilize the
available deduction within 2023, the unutilized balance was carried forward for offset in 2024, and
(ii) an increase in fair value gains on financial liabilities at fair value through profit or loss
resulting from the change in the valuation of contingent consideration for the acquisition of
Rayleigh Taide. Our fair value gains on financial liabilities at fair value through profit and loss in
2024 was related to the acquisition of Rayleigh Taide in 2023. In 2024, after analyzing its
operational performance and profitability, we engaged a professional valuation agency to conduct a
comprehensive review and impairment test on the cash generating units, and made the necessary
goodwill impairment provisions of RMB79.6 million. Accordingly, a reduction in consideration
payable and recognition of fair value gains on financial liabilities at fair value through profit or
loss of RMB60.2 million were recognized in 2024. See “— Discussion of Certain Components of
Consolidated Statements of Financial Position — Liabilities from Contingent Consideration.”
Administrative Expenses
Our administrative expenses increased by 81.1% from RMB112.5 million in 2023 to
RMB203.7 million in 2024, primarily due to (i) an increase in employee expense, primarily
resulting from an increase in share-based payment expenses recognized in 2024 and an increase in
performance-based compensation of management personnel; and (ii) an increase in office and
property related expenses, primarily due to our business growth.
FINANCIAL INFORMATION
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--- page 375 ---
Selling and Marketing Expenses
Our selling and marketing expenses increased by 48.3% from RMB132.2 million in 2023 to
RMB196.1 million in 2024, primarily due to (i) an increase in employee expenses of sales staff
driven by an increase in share-based payment expenses recognized in 2024 and an increase in our
expanding business scale; and (ii) an increase in travel and business expenses, driven by our
expanding business scale.
Research and Development Expenses
Our research and development expenses increased from RMB193.6 million in 2023 to
RMB266.8 million in 2024, mainly due to an increase in employee expenses of R&D employees
resulting from an increase in share-based payment expenses recognized in 2024 as well as the
expansion of our R&D team.
Impairment Losses on Financial Assets and Contract Assets under ECL, Net
We recorded impairment losses on financial assets and contract assets under ECL, net of
RMB17.4 million in 2023 and RMB23.4 million in 2024, mainly due to an increase in the year-end
receivable balances and changes in the aging structure.
Other Expenses
We recorded other expenses of RMB10.6 million in 2023 and RMB83.2 million in 2024,
mainly due to the impairment of goodwill of Rayleigh Taide, a subsidiary we acquired in 2023,
based on its lower-than-expected performance in 2024 which was mainly attributable to the market
conditions of the industry in which Rayleigh Taide operates and increased market competition. See
“— Other Income and Gains, Net.”
Profit for the Y ear
As a result of the foregoing, our net profit increased by 120.8% from RMB135.7 million in
2023 to RMB299.6 million in 2024.
FINANCIAL INFORMATION
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--- page 376 ---
Comparisons Between Years Ended December 31, 2023 and 2022
Revenue
Our revenue decreased by 41.3% from RMB2,786.2 million in 2022 to RMB1,634.3 million
in 2023, primarily due to a decline in the industry in which we operate and in various downstream
sectors, as reflected by (i) a decrease in the overall market demand for specialized PCB equipment
in China from approximately US$27.9 billion in 2022 to approximately US$3.7 billion in 2023;
and (ii) a decline in industry output value of various sectors downstream of PCB equipment, such
as servers and data storage, automotive electronics, mobile phones, computers, and consumer
electronics, among others, from approximately US$81.7 billion in 2022 to approximately US$69.5
billion in 2023, which in turn led to a decrease in demand for PCBs and related upstream
equipment. Especially, in the consumer electronics sector, following a peak in global product
shipments in 2021 and 2022, the market entered a period of correction. Downstream brand owners
moderated new order placements to address elevated channel inventories, while demand for key
end products such as smartphones and PCs softened. These factors contributed to a decline in
overall shipments and, consequently, a reduction in associated PCB output value. In the automotive
electronics sector, 2023 was marked by subdued macroeconomic conditions, misalignment between
vehicle production and sales schedules, and structural shortages of automotive-grade chips. As a
result, production volumes fell short of expectations, thereby constraining PCB demand within the
automotive industry. Additionally, the surplus inventory accumulated by automakers in 2022
translated into destocking pressures throughout 2023. Specifically:
 Our revenue from drilling equipment decreased by 50.9% from RMB1,666.8 million in
2022 to RMB818.1 million in 2023, primarily due to a decrease in sales volume from
2,514 units in 2022 to 1,129 units in 2023 while the average selling price of our drilling
equipment increased, resulting from the increase in the proportion of sales of laser
drilling equipment which has a higher average selling price.
 Our revenue from photolithography equipment decreased by 53.1% from RMB403.6
million in 2022 to RMB189.2 million in 2023, primarily due to a decrease in sales
volume from 132 units in 2022 to 79 units in 2023 and a decrease in the average selling
price of our photolithography equipment, resulting from the increase in the proportion of
sales of photolithography equipment which has a lower average selling price.
 Our revenue from testing equipment decreased by 30.5% from RMB284.3 million in
2022 to RMB197.6 million in 2023, primarily due to a decrease in sales volume from
519 units in 2022 to 400 units in 2023 and a decrease in the average selling price of our
testing equipment, resulting from the decrease in the proportion of sales of testing
equipment which has a higher average selling price.
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 Our revenue from formation equipment decreased by 29.1% from RMB214.9 million in
2022 to RMB152.3 million in 2023, primarily due to a decrease in sales volume from
463 units in 2022 to 289 units in 2023 while the average selling price of our formation
equipment increased, resulting from the increase in the proportion of sales of laser
formation equipment which has a higher average selling price.
 Our revenue from attachment equipment increased by 132.2% from RMB23.6 million in
2022 to RMB54.8 million in 2023, primarily due to an increase in sales volume of
attachment equipment from 74 units in 2022 to 183 units in 2023, driven by our
increased market share in the attachment equipment sector. However, the average selling
price of our attachment equipment decreased, primarily because, in light of intensified
market competition, we implemented competitive pricing for our older version
equipment to increase sales.
 Our revenue from others increased by 15.3% from RMB192.9 million in 2022 to
RMB222.4 million in 2023, primarily as a result of an increase in maintenance work
driven by the continuous increase in accumulated equipment sales.
Cost of Sales
Our cost of sales decreased by 37.0% from RMB1,838.3 million in 2022 to RMB1,157.4
million in 2023, primarily due to a decrease in the raw materials and consumables used, which was
generally in line with our decrease in revenue.
Gross Profit and Gross Profit Margin
As a result of the foregoing, our gross profit decreased by 49.7% from RMB947.8 million in
2022 to RMB476.9 million in 2023. Our gross profit margin decreased from 34.0% in 2022 to
29.2% in 2023, primarily due to a decrease in the gross profit margin of our drilling equipment.
 The gross profit of our drilling equipment decreased from RMB511.2 million in 2022 to
RMB204.5 million in 2023. The gross profit margin of our drilling equipment decreased
from 30.7% in 2022 to 25.0% in 2023, mainly due to (i) our offering of competitive
pricing as a result of heightened market competition and reduced demand for new
equipment from PCB manufacturers; and (ii) an increase in proportion of sales of
new-generation drilling equipment, which has a lower gross profit margin because at its
early stage of commercialization, it had yet to fully capitalize on economies of scale and
therefore bore high manufacturing costs.
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 The gross profit of our photolithography equipment decreased from RMB177.3 million
in 2022 to RMB67.0 million in 2023. The gross profit margin of our photolithography
equipment decreased from 43.9% in 2022 to 35.4% in 2023, mainly due to our offering
competitive pricing, due to heightened market competition and reduced demand for new
equipment from PCB manufacturers.
 The gross profit of our testing equipment decreased from RMB107.3 million in 2022 to
RMB72.1 million in 2023. The gross profit margin of our testing equipment remained
relatively stable at 37.7% in 2022 and 36.5% in 2023.
 The gross profit of our formation equipment decreased from RMB38.3 million in 2022
to RMB31.1 million in 2023. The gross profit margin of our formation equipment
increased from 17.8% in 2022 to 20.4% in 2023, mainly due to an increase in the
proportion of sales of laser formation equipment, which typically is of higher gross
profit margin.
 The gross profit of our attachment equipment increased from RMB6.1 million in 2022 to
RMB11.5 million in 2023. The gross profit margin of our attachment equipment
decreased from 26.0% in 2022 to 21.0% in 2023, primarily as a result of our adoption of
competitive pricing for our older version equipment to increase sales amid intensified
market competition.
 The gross profit of others decreased from RMB107.6 million in 2022 to RMB90.6
million in 2023. The gross profit margin of others decreased from 55.8% to 40.7% in
2023, primarily due to our implementation of strategic measures on after-sales
maintenance services to stimulate sales in light of the the inactive downstream markets
in 2023, which include the expansion of maintenance service scope and competitive
contract pricing. Such initiatives resulted in lower margin after-sales maintenance
services, and diluted the overall profitability of others.
Other Income and Gains, Net
Our other income and gains, net decreased by 30.8% from RMB184.7 million in 2022 to
RMB127.8 million in 2023, mainly due to a decrease in government grants, primarily as a result of
a decrease in sales of software components due to the general decrease in our sales, which led to a
reduction in V AT refund.
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Administrative Expenses
Our administrative expenses decreased by 26.8% from RMB153.7 million in 2022 to
RMB112.5 million in 2023, primarily due to (i) a decrease in employee expenses resulting from a
decrease in performance-based compensation of management personnel, primarily due to the
adverse impact on our performance caused by challenges in downstream industries; and (ii) a
decrease in depreciation and amortization expenses mainly attributable to the depreciation and
amortization of right-of-use assets, following the termination of leases for certain premises.
Selling and Marketing Expenses
Our selling and marketing expenses decreased by 17.6% from RMB160.5 million in 2022 to
RMB132.2 million in 2023, primarily due to (i) a decrease in employee expenses of sales staff
resulting from a decrease in performance-based compensation of selling and marketing employees,
driven by the adverse impact on our performance caused by challenges in downstream industries;
and (ii) a decrease in sales service and agency fees resulting from our decreased demand for sale
services due to the relatively inactive downstream industries.
Research and Development Expenses
Our research and development expenses decreased by 15.7% from RMB229.7 million in 2022
to RMB193.6 million in 2023, mainly due to a decrease in employee expenses resulting from a
decrease in performance-based compensation of R&D employees, primarily due to the adverse
impact on our performance caused by challenges in downstream industries.
Impairment Losses on Financial Assets and Contract Assets under ECL, Net
We recorded impairment losses on financial assets and contract assets under ECL, net of
RMB22.8 million in 2022 and RMB17.4 million in 2023, mainly due to changes in the year-end
receivable balances and the aging structure.
Impairment of an Investment in an Associate
We recorded impairment of an investment in an associate of RMB55.8 million in 2022,
primarily due to a decline in Shenzhen Mingxin’s performance resulting from unfavorable
downstream market conditions. The impairment of an investment in an associate amounted to nil in
2023, primarily due to Shenzhen Mingxin’s improved financial performance in 2023 which did not
trigger impairment testing.
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Profit for the Y ear
As a result of the foregoing, our net profit decreased by 68.6% from RMB432.0 million in
2022 to RMB135.7 million in 2023.
DISCUSSION OF CERTAIN COMPONENTS OF CONSOLIDATED STATEMENTS OF
FINANCIAL POSITION
Non-current Assets and Non-current Liabilities
The following table sets forth the components of our non-current assets and non-current
liabilities as of the dates indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Non-current Assets
Property, plant and equipment ....... 173,355 415,379 677,804 765,468
Investment properties ............. 1,957 1,880 1,803 1,738
Right-of-use assets ............... 590,720 534,548 493,578 474,990
Goodwill ....................... 12,924 153,963 74,323 12,924
Other intangible assets ............ 8,116 6,840 5,185 4,521
Investments in associates ........... 39,892 42,308 51,310 54,293
Trade and bills receivables at
amortized cost ................. 118,624 60,913 170,002 513,566
Prepayments, other receivables and
other assets ................... 73,501 51,508 69,030 39,373
Deferred tax assets ............... 58,112 67,085 49,967 89,338
Times deposits .................. — — 400,000 417,114
Total non-current assets .......... 1,077,201 1,334,424 1,993,002 2,373,325
Non-current liabilities
Interest-bearing borrowings ......... — — 211,050 179,960
Deferred income ................. 3,453 2,282 1,769 1,173
Provision ....................... 13,419 2,619 6,841 20,754
Lease liabilities .................. 83,407 45,011 12,798 12,141
Deferred tax liabilities ............. 3,794 5,063 5,064 5,269
Total non-current liabilities ....... 104,073 54,975 237,522 219,297
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Property, Plant and Equipment
Our property, plant and equipment consist of (i) buildings; (ii) machinery; (iii) motor
vehicles; (iv) electronic equipment; (v) other equipment; (vi) leasehold improvements; and (vii)
construction in progress. The following table sets forth a breakdown of our property, plant and
equipment as of the dates indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Buildings ...................... — — — 577,951
Machinery ...................... 38,997 39,408 69,833 71,993
Motor vehicles .................. 2,674 2,573 2,426 2,059
Electronic equipment .............. 7,500 6,402 7,489 19,991
Other equipment ................. 24,896 23,317 23,476 25,233
Leasehold improvements ........... 40,393 29,596 17,938 7,322
Construction in progress ........... 58,895 314,083 556,642 60,919
Total ......................... 173,355 415,379 677,804 765,468
Our property, plant and equipment increased from RMB173.4 million as of December 31,
2022 to RMB415.4 million as of December 31, 2023, and further increased to RMB677.8 million
as of December 31, 2024, primarily due to an increase in construction in progress resulting from
the construction of our industrial park. The industrial park is intended to be used for the
manufacturing of specialized PCB production equipment, R&D and product design. As of the
Latest Practicable Date, we had completed the acquisition of land; for certain buildings, we had
obtained the property ownership certificate, and for the remaining buildings, the construction of
main structures, and works on the greening of outdoor roads and fire protection, while the interior
renovation and deployment of production equipment were still in progress. As the industrial park is
still under construction, as of the Latest Practicable Date, we were still in the process of obtaining
the necessary permits and licenses for operation. The industrial park is expected to be completed
and commence operation by the end of 2026. The industrial park is intended to expand our
production capacity; we plan to relocate primarily the functional departments there, with minimal
impact on our existing production capacity, and the relocation will be completed before the
industrial park becomes operational in 2026. The relocation plan has not had, nor is it expected to
have, any material adverse impact on our business operations or financial performance and
conditions. Our property, plant and equipment increased from RMB677.8 million as of December
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31, 2024 to RMB765.5 million as of October 31, 2025, primarily due to an increase in buildings,
as we reclassified the asset from the construction in progress to the buildings with the completion
of the construction of buildings in our industrial park.
Right-of-Use Assets
Our right-of-use assets include land use right and leases of buildings. The following table sets
forth a breakdown of our right-of-use assets as of the dates indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Land use right ................... 467,688 459,896 450,184 442,778
Buildings ....................... 123,032 74,652 43,394 32,212
Total ......................... 590,720 534,548 493,578 474,990
Our right-of-use assets decreased from RMB590.7 million as of December 31, 2022 to
RMB534.5 million as of December 31, 2023, and further decreased by 7.7% to RMB493.6 million
as of December 31, 2024, and then decreased by 3.8% from RMB493.6 million as of December 31,
2024 to RMB475.0 million as of October 31, 2025, primarily due to the depreciation of land use
right and the leases of buildings, as well as early lease terminations.
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Net Current Assets
As of December 31,
As of
October 31,
As of
November 30,
2022 2023 2024 2025 2025
(RMB in thousands)
(unaudited)
Current assets
Inventories ............ 903,919 972,117 898,185 1,716,879 1,721,457
Trade and bills receivables .. 2,149,075 1,694,789 2,676,146 4,173,623 4,668,071
Contract assets ......... 19,179 19,610 24,880 45,888 39,096
Prepayments, other
receivables and other
assets ............. 15,899 39,406 54,820 112,085 184,738
Restricted cash ......... — 1,816 333 542 542
Cash and cash equivalents .. 2,986,535 1,916,965 1,539,131 1,146,344 1,065,201
Total current assets ..... 6,074,607 4,644,703 5,193,495 7,195,361 7,679,105
Current liabilities
Trade and bills payables ... 671,476 592,018 1,275,637 2,244,899 2,441,163
Contract liabilities ....... 25,955 65,754 54,895 61,423 113,272
Other payables and accruals . 503,327 380,460 411,581 590,976 741,922
Liabilities from contingent
consideration ......... — 68,683 8,523 — —
Interest-bearing borrowings .. 17,174 75,744 2,426 645,895 634,938
Lease liabilities ......... 45,063 35,497 34,716 22,120 20,275
Income tax payable ...... 37,357 5,724 9,250 80,630 127,121
Provisions ............ 16,671 11,727 15,570 19,154 20,941
Total current liabilities ... 1,317,023 1,235,607 1,812,598 3,665,097 4,099,632
Net current assets ...... 4,757,584 3,409,096 3,380,897 3,530,264 3,579,473
We had net current assets positions as of December 31, 2022, 2023, 2024, October 31, 2025
and November 30, 2025.
Our net current assets increased from RMB3,530.3 million as of October 31, 2025 to
RMB3,579.5 million as of November 30, primarily due to (i) an increase in trade and bills
receivables of RMB494.4 million and (ii) an increase in inventories of RMB4.6 million, partially
offset by (i) an increase in trade and bills payables of RMB196.3 million; (ii) an increase in other
payables and accruals of RMB150.9 million; and (iii) a decrease in cash and cash equivalents of
RMB81.1 million.
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Our net current assets increased from RMB3,380.9 million as of December 31, 2024 to
RMB3,530.3 million as of October 31, 2025, primarily due to an increase in trade and bills
receivables, inventories and prepayments, other receivables and other assets primarily driven by
our increased sales in the ten months ended October 31, 2025, partially offset by (i) an increase in
trade and bills payables and other payables and accruals driven by an increase in procurement to
respond to increased sales and by our expanded business scale; (ii) an increase in interest-bearing
borrowings which served as flexible sources for our enhanced raw material procurement in
response to market demand; and (iii) a decrease in cash and cash equivalents.
Our net current assets decreased from RMB3,409.1 million as of December 31, 2023 to
RMB3,380.9 million as of December 31, 2024, primarily due to (i) an increase in trade and bills
payables of RMB683.6 million which was mainly attributable to (a) an increased demand for our
products, resulting in the increase of trade payables, and (b) the issuance of more bills to settle
payments with suppliers in an effort to improve liquidity management; (ii) a decrease in cash and
cash equivalents of RMB377.8 million which was mainly attributable to our net cash flows used in
investing activities resulting from (a) purchases of items of property, plant and equipment, other
intangible assets and other non-current assets, and (b) an increase in time deposits; and (iii) a
decrease in inventories of RMB73.9 million, which was mainly attributable to the increased
turnover and improved efficiency in inventory management, partially offset by an increase in trade
and bills receivables of RMB981.4 million, which was mainly attributable to an increase in sales
resulting from the surge in demand for IT infrastructure in the AI industry chain, coupled with the
recovery of the consumer electronics sector and the technological upgrade of automotive
electronics.
Our net current assets decreased from RMB4,757.6 million as of December 31, 2022 to
RMB3,409.1 million as of December 31, 2023, primarily due to (i) a decrease of RMB1,069.5
million in cash and cash equivalents which was mainly attributable to our net cash flows used in
financing activities resulting from dividends paid; and (ii) a decrease of RMB454.3 million in
trade and bills receivables which was mainly attributable to a decrease in sales, partially offset by
a decrease of RMB122.8 million in other payables and accruals, which was mainly attributable to a
decrease in accruals of payroll and welfare payables resulting from a reduction in
performance-based compensation accrued in 2023 due to our declined financial performance in
2023.
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Inventories
Our inventories primarily consisted of (i) raw materials; (ii) work-in-progress; (iii)
semi-finished goods; (iv) materials consigned for processing; (v) finished goods; and (vi) goods in
transit. The following table sets out a breakdown of our inventories as of the dates indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Raw materials ................... 360,195 272,782 226,303 494,169
Work in progress ................. 256,188 279,650 247,439 625,137
Semi-finished goods .............. 66,599 47,094 58,254 104,171
Materials consigned for processing (1) . 19,993 18,959 20,495 33,199
Finished goods .................. 50,967 45,759 36,581 52,371
Goods in transit (2) ................ 182,734 365,487 352,143 465,815
Less: Write-down of inventories to net
realisable value ................ (32,757) (57,614) (43,030) (57,983)
Total ......................... 903,919 972,117 898,185 1,716,879
Note:
(1) Materials consigned for processing primarily consisted of raw materials sent to third parties for production and raw
materials dispatched for refurbishment, which would subsequently be returned to us.
(2) Goods in transit primarily consisted of equipment sent to clients for trial use and despatched equipment for which
revenue has not yet been recognized.
Our inventories increased by 91.1% from RMB898.2 million as of December 31, 2024 to
RMB1,716.9 million as of October 31, 2025, primarily because of the increase in market demand
and order. In response to the surge in demand in the ten months ended October 31, 2025, we
increased our stocking of drilling-related equipment materials. At the same time, taking into
account suppliers’ capacity and the procurement lead time of certain materials, we also increased
our stocking of long-lead-time materials to avoid interruptions to our production and product
delivery.
Our inventories decreased by 7.6% from RMB972.1 million as of December 31, 2023, to
RMB898.2 million as of December 31, 2024, primarily due to the recovery of customer orders,
which enabled us to accelerate inventory consumption and improve inventory turnover rate. As a
result, the inventory turnover days in 2024 shortened to 140 days, compared with 296 days in
2023.
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Our inventories increased by 7.5% from RMB903.9 million as of December 31, 2022, to
RMB972.1 million as of December 31, 2023, primarily due to the rapid growth of goods in transit
by 100.0% from 2022 to 2023, partially offset by a decrease in raw materials over the same years.
For domestic customers, once products pass production inspection, they are pending shipment, and
then must undergo transportation, installation, and commissioning. In practice, the cycle from
product dispatch to installation and commissioning may be affected by factors such as customer
site conditions and production line readiness. The increase in goods in transit was primarily due to
a surge in orders in the fourth quarter of 2023 which had not completed the above processes as of
December 31, 2023.
The following table sets forth an aging analysis of our inventories:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Below 6 months ................. 487,750 664,980 637,075 1,302,966
Between 6 months and 1 year ....... 271,542 105,969 141,837 241,278
1 year to 2 years ................. 110,906 137,877 66,047 112,751
Over 2 years .................... 33,721 63,291 53,226 59,884
Total ......................... 903,919 972,117 898,185 1,716,879
The following table sets forth our inventory turnover days for the years/periods indicated:
Year Ended December 31,
Ten months
ended
October 31,
2022 2023 2024 2025
Inventory turnover days (1) ......... 210 296 140 132
Note:
(1) Inventory turnover days are calculated using the average of opening balance and closing balance of inventories for
a year/period divided by cost of sales for the relevant year/period and multiplied by the number of days in the
relevant year/period, which is 365 days for each year and 300 days for the ten months ended October 31, 2025.
Our inventory turnover days increased from 210 days in 2022 to 296 days in 2023, primarily
due to the relatively low cost of sales in 2023, mainly attributable to a decrease in demand from
downstream industries. Meanwhile, although our costs decreased, we maintained a safe inventory
level to prevent stockouts, and we had a surge in orders in the fourth quarter of 2023 which
resulted in an increased inventory level. Our inventory turnover days decreased to 140 days in
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2024, and further decreased to 132 days in the ten months ended October 31, 2025, primarily due
to a substantial increase in cost of sales, primarily attributable to the increased sales in 2024,
driven by the increased demand for our products. In addition, we strengthened our inventory
management: we promote precise planning to align our inventory with market demands, ensuring
timely restocking to prevent shortages. By remaining agile and responsive to market fluctuations,
we adjust inventory levels as necessary. We also emphasize on the prompt clearance of long-aged
materials to minimize holding costs and enhance storage efficiency.
As of November 30, 2025, RMB646.7 million, or 37.7% of inventories as of October 31,
2025, had been used, consumed or sold. Our Directors are of the view that there are no material
impairment issues with these inventories. We have a comprehensive and adequate system in place
for identifying and accounting for inventory risks and impairment provisions. We conduct regular
reviews to detect items with low sales or usage value for which impairment provisions are made.
Inventories are measured at the lower of cost and net realizable value. For inventories with
impairment indicators, we have recognized adequate provisions in accordance with our accounting
policies, and such provisions have been audited by our reporting accountants to ensure adequacy
and compliance.
Trade and Bills Receivables
The following table sets forth a breakdown of our trade and bills receivables as of the dates
indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Trade receivables ................ 1,783,804 1,592,881 2,586,503 4,362,538
Bills receivable .................. 582,759 278,325 397,249 485,986
Less: Allowance for credit losses .... (98,864) (115,504) (137,604) (161,335)
Total .......................... 2,267,699 1,755,702 2,846,148 4,687,189
Our trade receivables and bills receivables mainly refer to outstanding amount due from our
customers and related parties for the purchase of goods we sold in the ordinary course of business,
less credit loss allowance. Our trade and bills receivables decreased by 22.6% from RMB2,267.7
million as of December 31, 2022, to RMB1,755.7 million as of December 31, 2023, primarily due
to a decrease in our revenue by 41.3% during the same period. Our trade and bills receivables
increased by 62.1% to RMB2,846.1 million as of December 31, 2024, primarily due to the industry
recovery in demand for our products in 2024 when our revenue grew by 104.6%. The growth rate
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of trade receivable was significantly lower than the growth rate of revenue, mainly because we
strengthened our liquidity management through measures such as implementing cash flow
budgeting, coordinating with the sales department to set collection targets, adopting quarterly
rolling budgets, enhancing collection efforts. These measures effectively reduced the capital tied
up in trade receivable. This was also reflected by a decrease in trade receivable turnover days from
377 days in 2023 to 228 days in 2024. Our trade and bills receivables further increased by 64.7%
to RMB4,687.2 million as of October 31, 2025, mainly driven by the surge in demand for IT
infrastructure along the AI industry chain, the recovery of the consumer electronics sector,
technological upgrades in automotive electronics, and broader industry expansion, all of which
contributed to higher sales volumes and increased order intake. For the ten months ended October
31, 2025, our revenue increased by 64.4%, and the expansion in sales scale resulted in a
corresponding 68.0% increase in trade receivables, broadly in line with the growth in revenue.
We generally grant credit terms ranging from three to 18 months to our customers.
The following table sets out an aging analysis of our trade receivables as of the dates
indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Within 1 year ................... 1,548,655 1,128,898 2,280,109 3,859,254
1 year to 2 years ................. 143,563 348,532 159,933 327,375
2 years to 3 years ................ 19,091 14,460 28,979 29,809
3 years to 5 years ................ 192 936 610 385
Over 5 years .................... 29 32 245 —
Total ......................... 1,711,530 1,492,858 2,469,876 4,216,823
We believe there were no recoverability issues for trade receivables aged over one year
during the Track Record Period. We closely review the balances of trade receivables on an ongoing
basis and assess the collectability of overdue balances. We routinely analyze the aging profile of
trade receivables to proactively identify potential risks to implement appropriate collection
methods. We also monitor the collections of trade receivables and retrospectively review the
accounting estimate of prior periods to identify any material discrepancies. To assess the adequacy
of the impairment of our trade receivables, our Directors have considered the recoverability of
certain customers, including, among others, the credit terms granted to customers, the credit
history, the historical settlement records, the aging analysis and forward-looking information.
Based on the results of our Director’s assessment, we provided the impairment losses of our trade
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receivables in accordance with the accounting policies in Note 3 to the Accountants’ Report set out
in Appendix I to this prospectus. On the basis of each of the factors as assessed above, our
Directors considered that sufficient provision had been made on trade receivables as of the end of
each year/period during the Track Record Period.
The following table sets forth our trade receivables turnover days for the years/periods
indicated:
Year Ended December 31,
Ten months
ended
October 31,
2022 2023 2024 2025
Trade receivables turnover days (1) ... 254 377 228 242
Note:
(1) Trade receivables turnover days are calculated using the average of opening balance and closing balance of trade
receivables (excluding provision for impairment) for a year/period divided by revenue for the relevant year/period
and multiplied by the number of days in the relevant year/period, which is 365 days for each year and 300 days for
the ten months ended October 31, 2025.
Our trade receivables turnover days increased from 254 days in 2022 to 377 days in 2023,
primarily due to an increased proportion of sales settled through installments as part of our efforts
to secure orders from customers, in light of the downturn in our industry and various downstream
sectors. In 2024, our trade receivables turnover days decreased to 228 days, mainly due to (i) a
shift in our product mix, with a higher proportion of products offering shorter payment terms; (ii)
an increase in revenue as the industry improved, leading to rebounded demand and more timely
customer payments; and (iii) the implementation of measures to enhance the management and
collection of trade receivables. Our trade receivables turnover days increased from 228 days in
2024 to 242 days in the ten months ended October 31, 2025, primarily due to an increased
proportion of sales settled through installments as part of our efforts to secure orders from
customers in light of the market competition. We identify and manage credit risks by conducting
thorough credit investigations and maintaining updated customer profiles. Customers are classified
based on financial indicators and credit risk, and we apply tailored credit management strategies to
different categories of customers. We also calculate credit sales limits for customers based on their
financial health and profitability.
As of November 30, 2025, RMB469.0 million, or 11.1% of our trade receivables as of
October 31, 2025, had been settled.
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Our Directors are of the view that there are no material recoverability issues with these trade
receivable for the following reasons (i) we have implemented stringent credit risk management
measures. We conduct comprehensive credit assessment during customer onboarding. For certain
customers with relatively small business scale or developing credit profiles, we typically require
them to either enter into guarantee agreements or make full payments through financing
arrangements in order to mitigate potential bad debt risks; (ii) we regularly assess the
recoverability of trade receivables, taking into account customer credit profiles, historical
repayment patterns, aging analysis and subsequent settlement; and (iii) impairment provisions have
been fully recognized in accordance with the expected credit loss model under IFRS 9 and audited
by our reporting accountants.
Prepayments, Other Receivables and Other Assets
Our prepayments, other receivables and other assets primarily consisted of prepayments for
raw materials and equipment, deposits for leases, value added tax recoverable and other
receivables pertaining to security deposits when submitting bids to customers. Our prepayments,
deposits and other receivables remained relatively stable at RMB89.4 million as of December 31,
2022 and RMB90.9 million as of December 31, 2023. Our prepayment, other receivables and other
assets increased by 36.3% from RMB90.9 million as of December 31, 2023 to RMB123.9 million
as of December 31, 2024, primarily due to (i) an increase in prepayments, mainly attributable to an
increase in sales orders, which increased our demand from and thus prepayments to upstream
suppliers; and (ii) an increase in V AT recoverable, primarily due to the input V AT on construction
and material procurement for projects under construction by a subsidiary, the revenue generated by
which was significantly less than the expenditure on engineering and materials, resulting in the
accumulation of the V AT to be recovered. Our prepayments, other receivables and other assets
increased by 22.3% from RMB123.9 million as of December 31, 2024 to RMB151.5 million as of
October 31, 2025, primarily due to (i) an increase in V AT recoverable, primarily due to higher
purchases of raw materials, which resulted in greater input V AT and thus a larger amount of V AT
available to be carried forward for future deduction; and (ii) an increase in prepayments, mainly
attributable to an increase in sales orders, which increased our demand from and thus prepayments
to upstream suppliers.
As of November 30, 2025, RMB64.0 million, or 42.2% of our prepayments, other receivables
and other assets as of October 31, 2025, had been settled.
FINANCIAL INFORMATION
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Trade and Bills Payables
Our trade and bills payables are non-interest-bearing. The following table sets out a
breakdown of our trade payables and bills payables as of the dates indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Trade payables .................. 398,582 545,395 664,080 1,368,006
Bills payables ................... 272,894 46,623 611,557 876,893
Total ......................... 671,476 592,018 1,275,637 2,244,899
Our trade payables and bills payables decreased by 11.8% from RMB671.5 million as of
December 31, 2022, to RMB592.0 million as of December 31, 2023, primarily due to an increase
in procurement of raw materials in the fourth quarter of 2023 in light of the increased demand for
our products. Meanwhile, the decrease in bills payables was primarily attributable to a decrease in
our settlement with customers with bills. Our trade and bills payables increased by 115.5% to
RMB1,275.6 million as of December 31, 2024, primarily because there was an increased demand
for our products, resulting in the increase of trade payables. In addition, we issued more bills to
settle payments with suppliers in an effort to improve liquidity management. Our trade and bills
payables increased by 76.0% from RMB1,275.6 million as of December 31, 2024 to RMB2,244.9
million as of October 31, 2025, primarily due to our increased purchase of raw materials in light
of increased demand of our products.
The trade payables are typically settled within six months. The following table sets out an
aging analysis of our trade payables as of the dates indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Within one year .................. 391,293 529,811 652,541 1,354,535
1 to 2 years ..................... 6,270 8,713 2,046 1,816
2 to 3 years ..................... 807 6,126 3,361 3,676
Over 3 years .................... 212 745 6,132 7,979
Total ......................... 398,582 545,395 664,080 1,368,006
FINANCIAL INFORMATION
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The following table sets forth our trade payables turnover days for the Track Record Period:
Year Ended December 31,
As of
October 31,
2022 2023 2024 2025
Trade payables turnover days (1) ..... 99 149 91 103
Note:
(1) Trade payables turnover days are calculated using the average of opening balance and closing balance of trade
payables for a year/period divided by cost of sales used for the relevant year/period and multiplied by the number
of days in the relevant year/period, which is 365 days for each year and 300 days for the ten months ended October
31, 2025.
Our trade payables turnover days increased from 99 days in 2022 to 149 days in 2023,
primarily due to (i) a decrease in cost of sales in 2023, which was in line with a decrease in
revenue; (ii) an increase in trade payables as of December 31, 2023, primarily due to an increase
in procurement of raw materials in the fourth quarter of 2023 in preparation for the increased
demand for our products; and (iii) our prudent management of our payment schedule to suppliers
to better control our liquidity position while maintaining favorable supplier relationships. Our
trade payables turnover days decreased to 91 days in 2024, primarily due to an increase in cost of
sales, which was in line with the increase in revenue during the same years or periods. Meanwhile,
we increased the settlement with suppliers using bills in 2024. Our trade payables turnover days
increased from 91 days in 2024 to 103 days in the ten months ended October 31, 2025, primarily
due to our prudent management of our payment schedule to suppliers and the use of financial
instruments to better control our liquidity position while maintaining favorable supplier
relationships. To effectively manage cash utilization, we maintain open communication with
suppliers and negotiate terms that are mutually beneficial, allowing for flexibility in payment when
needed. We closely monitor key performance indicators related to cash utilization and trade
payable turnover, which enables us to identify trends and make informed decisions. Our accounts
payable policies are regularly reviewed to ensure alignment with our business objectives and
market conditions. In addition, we flexibly utilize various payment methods to achieve optimal
cash utilization efficiency.
As of November 30, 2025, RMB404.4 million, or 29.6% of our trade payables as of October
31, 2025, and RMB80.7 million, or 9.2% of our bills payables as of October 31, 2025, had been
settled.
FINANCIAL INFORMATION
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Contract Liabilities
Our contract liabilities represent the advances received to deliver goods. As of December 31,
2022, 2023, 2024 and October 31, 2025, our contract liabilities amounted to RMB26.0 million,
RMB65.8 million, RMB54.9 million and RMB61.4 million, respectively. The relatively high
contract liabilities in 2023 were primarily due to the substantial amount of advance payment from
one new overseas customer, which ordered highly customized products from us.
As of November 30, 2025, RMB9.0 million, or 14.7% of our contract liabilities as of October
31, 2025, had been recognized as revenue.
Other Payables and Accruals
Our other payables and accruals primarily consist of (i) payroll and welfare payables; (ii)
endorsed bills receivable that have not been derecognized and not yet due; (iii) payable for
acquisition of a subsidiary; (iv) payable for acquisition of non-current assets; (v) other tax
payables; (vi) accruals; (vii) deposits; and (viii) others. The following table sets out a breakdown
of our other payables and accruals as of the dates indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Payroll and welfare payables ........ 304,272 204,448 179,436 250,732
Endorsed bills receivable that have
not been derecognized and not yet
due ......................... 100,546 82,868 100,908 210,110
Payable for acquisition of non-current
assets ........................ 51,033 56,301 100,318 105,087
Other tax payables ............... 37,066 19,615 15,836 15,052
Accruals ....................... 9,439 14,768 14,336 9,131
Deposits ....................... 971 877 691 864
Others ......................... — 1,583 56 —
Total ......................... 503,327 380,460 411,581 590,976
Our other payables and accruals decreased by 24.4% from RMB503.3 million as of December
31, 2022 to RMB380.5 million as of December 31, 2023, primarily due to a decrease in accruals of
payroll and welfare payables, which was primarily because there was a reduction in
performance-based compensation accrued in 2023 due to our declined financial performance in
FINANCIAL INFORMATION
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2023. Our other payables and accruals increased by 8.2% to RMB411.6 million as of December
31, 2024, primarily due to an increase in payable for acquisition of non-current assets related to
the construction of our industrial park. Meanwhile, our payroll and welfare payables as of
December 31, 2024 decreased, primarily due to payments made in 2024. Our other payables and
accruals increased from RMB411.6 million as of December 31, 2024 to RMB591.0 million as of
October 31, 2025, primarily due to (i) an increase in payable for acquisition of non-current assets
related to the construction of our industrial park; (ii) an increase in endorsed bills receivable that
have not been derecognized and not yet due, primarily due to an increase in the use of endorsed
bills to make payments for our procurement of raw materials and consumables; and (iii) an
increase in payroll and welfare payables driven by our overall business expansion and an increase
in employee headcount.
As of November 30, 2025, RMB209.1 million, or 35.4% of our other payables and accruals
as of October 31, 2025, had been settled.
Liabilities from Contingent Consideration
We had liabilities from contingent consideration of RMB68.7 million, RMB8.5 million and
nil as of December 31, 2023, 2024 and October 31, 2025, respectively. Our liabilities from
contingent consideration arose from the acquisition of 60% equity interest in Rayleigh Taide.
Pursuant to the acquisition agreement entered into between us and the seller of the 60% equity
interest (an Independent Third Party) in Rayleigh Taide, the total consideration shall be adjusted
with reference to the net profit of Rayleigh Taide in 2022, 2023, 2024 and 2025 (the “ Contingent
Consideration ”). The initial amount of the Contingent Consideration recognized upon the
acquisition was RMB68.7 million, which was determined using the discounted cash flow model
and is within Level 3 fair value measurement. The consideration is due for final measurement and
payment to the former shareholders on December 31, 2025. A significant increase/decrease in the
profit before tax of Rayleigh Taide would result in a significant increase/decrease in the fair value
of our Contingent Consideration liability. In 2024, due to the market conditions of the industry in
which Rayleigh Taide operates and increased market competition, Rayleigh Taide experienced a
decline in operational performance and profitability and its actual operating results for 2024 were
lower than the profit forecast at the time of acquisition. Our management engaged an independent
professional valuation agency to conduct a comprehensive review and impairment test on the cash
generating units that might show signs of impairment, and made the impairment provisions of
RMB79.6 million in 2024. As a result, the carrying amount of our goodwill was written down by
RMB79.6 million in 2024. Accordingly, a reduction in consideration payable and recognition of
fair value gains on financial liabilities at fair value through profit or loss of RMB60.2 million
were also recognized in 2024, resulting in a decrease in our liabilities from contingent
FINANCIAL INFORMATION
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consideration from RMB68.7 million as of December 31, 2023 to RMB8.5 million as of December
31, 2024. See Note 18, Note 33 and Note 39 to the Accountants’ Report in Appendix I to this
Prospectus.
LIQUIDITY AND CAPITAL RESOURCES
During the Track Record Period and up to the Latest Practicable Date, we have historically
funded our cash requirements principally from proceeds from our business operations, capital
contribution from shareholders and bank borrowings. After the Global Offering, we intend to
finance our future capital requirements through cash generated from our business operations and
the net proceeds from the Global Offering. We do not anticipate any changes to the availability of
financing to fund our operations in the future.
Cash Flow
The following table sets forth a summary of our cash flows for the years/periods indicated:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Net cash flows
from/(used in)
operating activities .. 655,354 416,774 154,986 (123,331) (754,356)
Net cash used in
investing activities .. (145,763) (310,938) (623,967) (595,128) (111,583)
Net cash from/(used in)
financing activities .. 2,256,554 (1,174,846) 93,786 (63,030) 473,845
Cash and cash
equivalents at
beginning of
year/period ........ 219,259 2,986,535 1,916,965 1,916,965 1,539,131
Effect of foreign
exchange rate
changes, net ....... 1,131 (560) (2,639) (2,074) (693)
Cash and cash
equivalents at end
of year/period ..... 2,986,535 1,916,965 1,539,131 1,133,402 1,146,344
FINANCIAL INFORMATION
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Net Cash Flows from/(Used in) Operating Activities
Our cash flows from operating activities primarily reflect our profit before taxation adjusted
by: (i) non-cash and non-operating items and (ii) changes in working capital.
In the ten months ended October 31, 2025, our net cash flows used in operating activities
were RMB754.4 million, Our net cash used in operating activities is calculated by adjusting our
profit before tax of RMB589.9 million by non-cash and other items to arrive at an operating profit
before working capital changes of RMB855.1 million. Our movements in working capital primarily
reflect (i) an increase in trade and bills receivables of RMB2,774.8 million and (ii) an increase in
inventories of RMB860.9 million, partially offset by (i) an increase in trade and bills payables of
RMB1,771.6 million and (ii) an increase in other payables and accruals of RMB293.7 million.
We recorded operating cash outflow for the ten months ended October 31, 2025, primarily
due to (i) a timing mismatch between cash inflows from sales and cash outflows for purchases; and
(ii) higher performance-based remuneration and an increase in headcount, which further increased
cash outflows related to employee compensation.
To improve the net cash outflow position as of October 31, 2025, we continued to implement
liquidity measures, such as steady cash flow operations and budgeting, collaborating with sales
department, adopting rolling budgets, and following up on customer payments. Further, we
increased the proportion of prepayments to secure earlier cash inflows and reduce reliance on
extended installment settlements, which typically delay cash collection. For example, with regards
to certain types of our equipment products designed for AI servers, we initially offered credit
periods ranging from 12 to 20 months upon launch. As we further upgraded our products and
improved their competitiveness, and taking into account market competitive landscape, we actively
negotiated with customers and were able to bargain for shortened credit periods ranging from
approximately three to 12 months, with the specific credit period for each customer determined
after careful analysis of each customer’s creditworthiness and historical credit records. We believe
such significant operating cash outflow in the ten months ended October 31, 2025 is temporary,
and that the above measures will lead to improvements in our operating cash flow position for the
full year of 2025.
We experienced similar operating cash outflow in the ten months ended October 31, 2024 as
well, because in 2024, we experienced a significant increase in sales revenue, which in turn
required us to expand our procurement scale to meet such increase in demand, resulting in a
significant increase in payments to suppliers. In the ten months ended October 31, 2024, our trade
receivable turnover days reached 240 days, and we experienced net cash used in operating
activities of RMB123.3 million.
FINANCIAL INFORMATION
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To reduce such turnover days and improve operating cash flow position, we focused on the
following, which we also continued to implement and improve in 2025:
 maintaining steady cash flow operations and budgeting by enhancing cash flow
forecasting and payment scheduling with an aim to optimize payment timing and
maintain a balance between cash payments and the need to support essential operational
expenditure and procurement;
 collaborating with the sales department to set collection targets;
 adopting quarterly rolling budgets, and conducting reviews and analyses on variances
between budgeted and actual figures to identify underlying reasons; and
 following up on customer payments in a timely manner, including implementing targeted
collection strategies, particularly for customers with longer outstanding receivables.
We also enhanced collection efforts in the last two months of 2024, adopted bank acceptance
bills to optimize the procurement payment cycle, and incentivized our sales personnel to expedite
cash collection. As a result of the above measures our trade receivable turnover days improved
from 240 days in the ten months ended October 31, 2024 to 228 days for the year ended December
31, 2024. Benefitting from the above measures, our net operating cash outflow of RMB123.3
million in the ten months ended October 31, 2024 reverted to a net operating cash inflow of
RMB155.0 million in the full year of 2024.
In 2024, our net cash flows from operating activities were RMB155.0 million. Our net cash
from operating activities is calculated by adjusting our profit before tax of RMB329.6 million by
non-cash and other items to arrive at an operating profit before working capital changes of
RMB603.9 million. Our movements in working capital primarily reflect (i) an increase in trade and
bills payables of RMB1,361.7 million and (ii) a decrease in inventories of RMB11.5 million,
partially offset by an increase in trade and bills receivables of RMB1,813.7 million. Our operating
cash flow decreased in 2024 compared to 2023 despite recording an increase in operating profit
before working capital changes, primarily because we generally grant credit terms of three to 18
months, and as a result, our net cash generated from operating activities in 2024 is largely
correlated to our results of operations in 2023. Our cash from operating activities in 2024 was also
negatively affected by (i) an increase in the amount paid for matured notes payable in 2024; and
(ii) high procurement expenditures in late 2024 to fulfill the increased orders. Our net operating
cash outflow position in the ten months ended October 31, 2024 turned into a net operating cash
inflow position in the full year of 2024 due to the above measures on cash flow operations and
budgeting, collaborating with sales department and other measures to expedite cash collection.
FINANCIAL INFORMATION
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In 2023, our net cash flows from operating activities were RMB416.8 million. Our net cash
from operating activities is calculated by adjusting our profit before tax of RMB137.4 million by
non-cash and other items to arrive at an operating profit before working capital changes of
RMB247.4 million. Our movements in working capital primarily reflect (i) an increase in trade and
bills payables of RMB309.7 million and (ii) a decrease in trade and bills receivables of RMB119.0
million, partially offset by (i) a decrease in other payables and accruals of RMB135.5 million and
(ii) an increase in inventories of RMB116.1 million.
In 2022, our net cash flows from operating activities were RMB655.4 million. Our net cash
from operating activities is calculated by adjusting our profit before tax of RMB483.3 million by
non-cash and other items to arrive at an operating profit before working capital changes of
RMB633.3 million. Our movements in working capital primarily reflect (i) a decrease in
inventories of RMB271.1 million and (ii) an increase in trade and bills payables of RMB217.0
million, partially offset by a decrease in other payables and accruals of RMB227.5 million.
Net Cash Flows Used in Investing Activities
In the ten months ended October 31, 2025, our net cash flows used in investing activities
were RMB111.6 million, which was attributable to purchases of items of property, plant and
equipment, other intangible assets and other non-current assets of RMB114.2 million, partially
offset by dividend received from an associate of RMB2.6 million.
In 2024, our net cash flows used in investing activities were RMB624.0 million, which was
attributable to (i) purchases of items of property, plant and equipment, other intangible assets and
other non-current assets of RMB224.1 million; and (ii) an increase in time deposits of RMB400.0
million.
In 2023, our net cash flows used in investing activities were RMB310.9 million, which was
attributable to (i) purchases of items of property, plant and equipment, other intangible assets and
other non-current assets of RMB242.4 million; and (ii) acquisition of subsidiaries of RMB69.1
million, partially offset by proceeds from disposal of items of property, plant and equipment,
right-of-use assets and other non-current assets of RMB0.6 million.
In 2022, our net cash flows used in investing activities were RMB145.8 million, which was
attributable to (i) purchases of items of property, plant and equipment, other intangible assets and
other non-current assets of RMB143.8 million; and (ii) addition of investment in an associate of
RMB2.0 million.
FINANCIAL INFORMATION
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Net Cash Flows From/(Used) in Financing Activities
In the ten months ended October 31, 2025, our net cash flows generated from financing
activities were RMB473.8 million, primarily attributable to proceeds of borrowings from banks of
RMB1,610.8 million, partially offset by repayment of borrowings from banks of RMB1,024.7
million.
In 2024, our net cash flows generated from financing activities were RMB93.8 million,
primarily attributable to proceeds of borrowings from banks of RMB867.1 million, partially offset
by repayment of borrowings from banks of RMB728.8 million.
In 2023, our net cash flows used in financing activities were RMB1,174.8 million, primarily
attributable to dividends paid of RMB1,197.0 million, partially offset by proceeds of borrowings
from banks of RMB75.7 million.
In 2022, our net cash flows generated from financing activities were RMB2,256.6 million,
primarily attributable to proceeds from issue of shares of RMB3,093.3 million, partially offset by
repayments of borrowings from banks of RMB871.5 million.
INDEBTEDNESS
As of December 31, 2022, 2023, 2024, October 31, 2025 and November 30, 2025, our
indebtedness included interest-bearing borrowings and lease liabilities. The following table sets
forth a breakdown of our indebtedness as of the dates indicated:
As of December 31,
As of
October 31,
As of
November
30,
2022 2023 2024 2025 2025
(RMB in thousands)
(unaudited)
Current
Interest-bearing borrowings ....... 17,174 75,744 2,426 645,895 634,938
Lease liabilities ................ 45,063 35,497 34,716 22,120 20,275
Sub-total .................... 62,237 111,241 37,142 668,015 655,213
Non-current
Interest-bearing borrowings ....... — — 211,050 179,960 179,960
Lease liabilities ................ 83,407 45,011 12,798 12,141 11,216
Sub-total .................... 83,407 45,011 223,848 192,101 191,176
Total ........................ 145,644 156,252 260,990 860,116 846,389
FINANCIAL INFORMATION
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Lease Liabilities
As of December 31, 2022, 2023, 2024 and October 31, and November 30, 2025, our total
lease liabilities (including current and non-current portions) amounted to RMB128.5 million,
RMB80.5 million, RMB47.5 million, RMB34.3 million and RMB31.5 million, respectively.
Our total lease liabilities decreased by 37.4% from RMB128.5 million as of December 31,
2022 to RMB80.5 million as of December 31, 2023, and then decreased by 41.0% to RMB47.5
million as of December 31, 2024, and further decreased by 27.9% to RMB34.3 million as of
October 31, 2025, before decreasing by 8.1% to RMB31.5 million as of November 30, 2025
primarily due to a decrease in the remaining lease terms. The effective interest rates of our lease
liabilities ranged from 1.45% to 4.75% during the Track Record Period and in the eleven months
ended November 30, 2025.
Interest-bearing Borrowings
As of December 31, 2022, 2023, 2024, October 31, 2025 and November 30, 2025, our
interest-bearing borrowings amounted to RMB17.2 million, RMB75.7 million, RMB213.5 million,
RMB825.9 million and RMB814.9 million, respectively, mainly representing unsecured bank loans
and discounted unmatured bills for working capital purposes. The increase in our current
interest-bearing borrowings from RMB2.4 million as of December 31, 2024 to RMB645.9 million
as of October 31, 2025 was primarily attributable to our cash management strategy, which involves
our carefully balancing the use of internal resources with the cost of external funding to optimize
overall funding costs while satisfying our cash needs to achieve business operations and growth.
The effective interest rate on our bank loans ranged from 2.08% to 3.60% during the Track Record
Period and up to November 30, 2025.
As of November 30, 2025, our unutilized banking facilities amounted to RMB1,905.7 million.
Our bank borrowings are all denominated in Renminbi.
No Other Outstanding Indebtedness
Our Directors confirm that (i) as of the Latest Practicable Date, there was no material
covenant on any of our outstanding debt; and (ii) our Group did not experience any difficulty in
obtaining bank loans and other borrowings, material default in payment of trade and non-trade
payables, bank loans and other borrowings or breach of covenants during the Track Record Period
and up to the date of this Prospectus.
FINANCIAL INFORMATION
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Except as disclosed above, as of November 30, 2025, being the most recent practicable date
for determining our indebtedness, we did not have any outstanding mortgages, charges, debentures,
other issued debt capital, bank overdrafts, borrowings, liabilities under acceptance or other similar
indebtedness, hire purchase commitments, guarantees or other material contingent liabilities. Our
directors have confirmed that there has been no material change in our indebtedness from
November 30, 2025 to the date of this Prospectus.
CONTINGENT LIABILITIES
Our contingent liabilities amounted to RMB25.5 million, RMB25.5 million, RMB35.5 million
and RMB45.5 million as of December 31, 2022, 2023, 2024 and October 31, 2025, respectively,
which was in relation to our undertaking to make available a part of our facilities under
construction for public use per requirement of the local government in accordance with
government policies. The facilities under construction for public use primarily consist of
community and public service facilities located within the industrial park, such as community
management and service centers, community health service centers, community cultural activity
rooms, public transport terminals, public charging stations and security offices. A guarantee has
been issued in respect of these undertakings. As a result, we may be subject to compensation
claims from the local government if we fail to fulfill such obligations. As such, the above
liabilities are contingent upon local governments’ potential to raise claims if we breach our
undertaking. We plan to comply with the relevant requirement of the local government by strictly
following the public resource planning and construction plans approved by the local government.
During construction, we will adhere to all applicable national, provincial, and municipal laws and
regulations regarding quality, safety, fire protection, planning, environmental protection, gas, and
energy conservation, using building materials that meet national standards for safety, durability,
cost-effectiveness, and environmental protection. We will assume full management responsibility
throughout the construction process, proactively accept supervision from the relevant authorities,
and only transfer the completed facilities to the local government for acceptance after passing all
required inspections and acceptance procedures.
NO MATERIAL CHANGES
The Directors confirm that, up to the date of this Prospectus, there has been no material
adverse change in our financial or trading position since October 31, 2025, and there is no event
since October 31, 2025 which would materially affect the information shown in the consolidated
financial statements included elsewhere in this Prospectus.
FINANCIAL INFORMATION
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KEY FINANCIAL RATIOS
The following table sets forth our key financial ratios as of the dates or for the years/periods
indicated:
As of/Year ended
December 31,
As of/Ten months ended
October 31,
2022 2023 2024 2024 2025
(unaudited)
Current ratio (times) (1)............... 4.6 3.8 2.9 — 2.0
Quick ratio (times) (2) ............... 3.9 3.0 2.4 — 1.5
Gearing ratio (%)(3) ................ 19.9 21.6 28.5 — 40.6
Return on equity (%)(4) .............. 10.7 2.6 6.1 4.4 9.6
Gross profit margin (%) (5) ............ 34.0 29.2 27.2 26.2 31.1
Net profit margin (%) (6) .............. 15.5 8.3 9.0 8.1 12.0
Notes:
(1) Current ratio equals current assets divided by current liabilities as of the same date.
(2) Quick ratio equals current assets minus inventories divided by current liabilities as of the same date.
(3) Gearing ratio equals total liabilities divided by total assets as of the same date and multiplied by 100%.
(4) Return on equity equals profit for the year/period after tax attributable to owners of the parent divided by average
total equity attributable to owners of the parent and multiplied by 100%.
(5) Gross profit margin equals gross profit divided by revenue for the year/period.
(6) Net profit margin equals profit divided by revenue for the year/period.
Our gearing ratio increased from 19.9% as of December 31, 2022 to 21.6% as of December
31, 2023, primarily due to the decrease in total assets. Our gearing ratio increased from 21.6% as
of December 31, 2023 to 28.5% as of December 31, 2024, primarily due to the increase in total
liabilities. Our gearing ratio increased from 28.5% as of December 31, 2024 to 40.6% as of
October 31, 2025, primarily due to a faster increase in total liabilities.
CAPITAL EXPENDITURES
During the Track Record Period, our capital expenditures consisted of expenditures for the
purchases of property, plant and equipment, other intangible assets and other non-current assets.
FINANCIAL INFORMATION
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In 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025, our capital
expenditures were RMB143.8 million, RMB242.4 million, RMB224.1 million, RMB195.2 million
and RMB114.2 million, respectively. We funded these expenditures mainly with cash generated
from our business operations.
Following the Global Offering, we will continue to incur capital expenditures to grow our
business. We plan to fund our planned capital expenditures primarily with cash flows generated
from our operations. See “Future Plans and Use of Proceeds.” We may adjust our capital
expenditures for any given year according to our development plans or in light of market
conditions and other factors we believe to be appropriate.
CAPITAL COMMITMENTS
The following table sets forth details of our capital commitments as of the dates indicated:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Property, plant and equipment ...... 5,786 2,405 1,104 92,484
Intangible assets ................. 873 604 157 319
Long-term prepaid expenses —
renovation expenses ............. 9,445 6,701 4,270 24,807
Construction in progress ........... 41,886 234,979 134,137 822
Total .......................... 57,990 244,689 139,668 118,432
Our construction in progress as of December 31, 2022, 2023, 2024 and October 31, 2025
primarily represented the construction of our industrial park.
RELATED PARTY TRANSACTIONS
For details about our related party transactions during the Track Record Period, see Note 44
of Appendix I to this Prospectus.
Our Directors are of the view that each of the related party transactions set out in Note 44 to
the Accountants’ Report 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.
FINANCIAL INFORMATION
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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 make our historical results not reflective of our
future performance.
OFF-BALANCE SHEET COMMITMENTS AND ARRANGEMENTS
As of the Latest Practicable Date, we had not entered into any off-balance sheet
arrangements.
FINANCIAL RISKS DISCLOSURE
Our Group’s principal financial instruments comprise cash and cash equivalents, restricted
cash, trade and bills receivables, trade and bills payables, financial assets included in prepayments,
other receivables and other assets, time deposits, financial liabilities included in other payables
and accruals, interest-bearing borrowings and lease liabilities. The main purpose of these financial
instruments is to raise finance for our operations. We have various other financial assets and
liabilities such as trade and bills receivables and trade and bill payables, which arise directly from
our operations.
The main risks arising from our financial instruments are interest rate risk, foreign currency
risk, credit risk and liquidity risk. The Board of Directors reviews and agrees policies for
managing each of these risks.
Interest Rate Risk
Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. Our Group’s exposure to the risk of changes in market
interest rates relates primarily to our Group’s interest-bearing bank borrowings.
Foreign Currency Risk
Foreign currency risk is the risk of loss resulting from changes in foreign currency exchange
rates. Fluctuations in exchange rates between RMB and other currencies in which our Group
conducts business may affect our Group’s financial condition and results of operations.
Credit Risk
Our Group trades only with recognized and creditworthy parties. It is our Group’s policy that
all customers who wish to trade on credit terms are subject to credit verification procedures.
FINANCIAL INFORMATION
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For other receivables and other assets, management makes periodic collective assessment as
well as individual assessment on the recoverability of other receivables based on historical
settlement records and past experience. Our Directors believe that there is no material credit risk
inherent in our Group’s outstanding balance of other receivables.
Further quantitative data in respect of our Group’s exposure to credit risk arising from trade
and bills receivables and contract assets are disclosed in Note 22 and 24 to the Accountants’
Report in Appendix I to this Prospectus.
Since our Group trades only with recognized and creditworthy third parties, there is no
requirement for collateral. Concentrations of credit risk are managed by customer/counterparty, by
geographical region and by industry sector. There are no significant concentrations of credit risk
within our Group.
Liquidity Risk
Our Group monitors our risk to a shortage of funds using a recurring liquidity planning tool.
This tool considers the maturity of both its financial instruments and financial assets and projected
cash flows from operations.
See Note 47 to the Accountants’ Report in Appendix I to this document.
DIVIDENDS AND DIVIDEND POLICY
Our dividend policy states that in principle we carry out cash dividends once a year; the
specific dividend ratio shall be formulated by the Board in accordance with relevant regulations
and operating conditions, and deliberated and approved by Shareholders’ general meeting. We do
not currently have any fixed dividend pay-out ratio. Future profit distributions may be carried out
in the form of cash dividends or stock dividends or a combination, or other methods permitted by
laws and regulations, and we preferentially adopt cash dividends. Any proposed distribution is
subject to the discretion of our Board and approval at our Shareholders’ meetings as described
above, after considering our results of operations, financial condition, operating and capital
requirements, shareholders’ interests and other conditions deemed relevant.
FINANCIAL INFORMATION
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During the Track Record Period, we declared cash dividends to our shareholders as follows:
As of December 31,
As of
October 31,
2022 2023 2024 2025
(RMB in thousands)
Final dividends in respect of the
previous year, declared and paid
during the year/period (tax
inclusive) ..................... 168,000 1,197,000 — 168,000
See Note 13 to the Accountants’ Report in Appendix I to this Prospectus.
WORKING CAPITAL CONFIRMATION
Taking into account the financial resources available to us, including our cash and cash
equivalents on hand, operating cash flows, available financing facilities, and the estimated net
proceeds from the Global Offering, our Directors are of the view that we have sufficient working
capital to meet our present requirements and for at least the next 12 months from the date of this
Prospectus.
DISTRIBUTABLE RESERVES
As of October 31, 2025, we had approximately RMB5,095.5 million of retained earnings
available for distribution to our shareholders.
PROFIT ESTIMATE FOR THE YEAR ENDED DECEMBER 31, 2025
On the basis set out in Appendix IIA to this Prospectus, and in the absence of unforeseen
circumstances, we estimate that our unaudited consolidated profit attributable to equity holders of
the Company for the year ended December 31, 2025 is as follows:
Estimated consolidated profit attributable to equity holders
of the Company ...............................
Not less than RMB785 million
(equivalent to HK$871 million)
FINANCIAL INFORMATION
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LISTING EXPENSES
Listing expenses represent professional fees, underwriting commissions and other fees
incurred in connection with the Global Offering. We estimate that our listing expenses will be
approximately HK$202.6 million (assuming the maximum Offer Price of HK$95.80 per Offer
Share and no exercise of the Over-allotment Option), representing 4.2% of the gross proceeds
(based on the maximum Offer Price for the Global Offering and assuming that the Over-allotment
Option is not exercised) of the Global Offering. We recorded listing expenses of nil, nil, nil, nil
and RMB1.1 million in 2022, 2023, 2024 and the ten months ended October 31, 2024 and 2025,
respectively. We expect to incur listing expenses of approximately HK$202.6 million, of which
approximately HK$6.2 million is expected to be recognized in the consolidated statements of profit
or loss as administrative expenses and approximately HK$196.4 million is expected to be
recognized as a deduction in equity directly upon the Listing. Our Directors do not expect such
expenses to materially impact our results of operations in 2025. By nature, our listing expenses are
composed of (i) underwriting commission and discretionary fees of approximately HK$169.2
million; and (ii) non-underwriting related expenses of approximately HK$33.4 million, which
consist of fees and expenses of legal advisors and Reporting Accountants of approximately
HK$20.9 million and other fees and expenses of approximately HK$12.5 million.
UNAUDITED PRO FORMA ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS
See “Appendix II — Unaudited Pro Forma Financial Information.”
NO MATERIAL ADVERSE CHANGE
Our Directors have confirmed that up to the date of this Prospectus there has been no
material adverse change in our financial or trading position or prospects since October 31, 2025,
being the end date of the years/periods reported in Appendix I to this Prospectus, and there is no
event since October 31, 2025 that would materially affect the information as set out in the
Accountants’ Report in Appendix I to this Prospectus.
DISCLOSURE REQUIRED UNDER THE LISTING RULES
Our Directors confirm 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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FUTURE PLANS
See “Business — Our Strategies” in this Prospectus for a detailed description of our future
plans.
USE OF PROCEEDS
Assuming that the Over-allotment Option is not exercised, after deducting the underwriting
commissions and other estimated offering expenses payable by us in connection with the Global
Offering, and assuming the maximum Offer Price of HK$95.80 per Share, we estimate that we will
receive net proceeds of approximately HK$4,630.7 million from the Global Offering.
We intend to use 90.0% of the net proceeds, or approximately HK$4,167.6 million, in
enhancing the R&D and operational capabilities and improving the production capacity of
specialized PCB equipment in China, seeing China’s core position in the global PCB industry and
China’s well-established electronic information industry chain. Such layout is expected to enable
us to leverage the local industry cluster effect and integrate R&D, production and market
resources, further consolidating our competitive advantage in the global PCB equipment sector.
According to Prismark, China is the largest PCB production base in the world, with an output
value of US$41.2 billion in 2024, accounting for approximately 56% of the global PCB output
value, and China’s PCB output value is expected to reach US$49.7 billion in 2029. China’s PCB
industry is undergoing structural transformation, upgrading from traditional through-hole board to
high-end HDI, package substrate, high-frequency high-speed board. The demand for high-precision
high-performance specialized equipment continues to thrive. Fuelled by the AI computing
revolution and the surge in intelligent new energy vehicles, there has been a significant increase in
demand for high-end PCB products, such as high multi-layer boards (particularly those with 18
layers or more), SLPs and packaging substrates. This trend has also directly contributed to the
strong demand for high-end PCB-dedicated manufacturing equipment. Investments in related
equipment have also increased significantly.
Our target customers include industry-leading domestic and global manufacturers that set up
production basis in China and Southeast Asia. These customers focus on high-end products such as
high multi-layer boards for AI servers, GPU-packaged substrates and high-frequency high-speed
boards for new energy vehicles, typically with a reduced lead time of less than 90 days.
Leveraging our extensive technological expertise in the specialized PCB equipment industry, we
offer a diverse product portfolio that encompasses nearly all major PCB. Our customers already
include 80% of the enterprises in the Prismark Global PCB Top 100 Enterprises List in 2024. We
expect to further expand our market share in China while also meeting the needs of Southeast
Asian customers as they pursue overseas expansion.
FUTURE PLANS AND USE OF PROCEEDS
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Our decision to improve the production capacity and enhance the R&D and operational
capabilities in China was made following comprehensive feasibility study. We have also performed
a financial return analysis with regards to capacity expansion projects. We do not expect to
experience any material obstacles to securing the necessary license and permits. The
commencement of improving the production capacity and enhancing the R&D and operational
capabilities is contingent upon receipt of proceeds from the Global Offering.
Specifically, we intend to use the proceeds from the Global Offering for the purposes and in
the amounts set forth below:
 approximately 50.0% of the net proceeds, or HK$2,315.3 million, will be used in
enhancing the R&D and operational capabilities. We intend to better understand and
meet the needs of our overseas customers, especially responding quickly to those in
areas of AI servers, NEVs, and next-generation intelligent terminals. We aim to ensure
that our products align with the latest technological advancements and further enhance
our global distribution channels and sales and services networks by facilitating the
integration of R&D, manufacturing and sales. In addition, we intend to strengthen our
international R&D team by attracting international talents and setting up advanced
laboratories and centers dedicated to research collaboration and exchange. Our goal is to
continuously develop innovative solutions in areas of high-end PCBs, advanced
packaging substrates and new materials processing, thereby enhancing our brand
recognition among end customers.
 approximately 40.0% of the net proceeds, or HK$1,852.3 million, will be used to
increase investments in R&D and enhance our core technological and innovative
capabilities, which include establishing a technology platform for PCB equipment
and diversifying our product portfolio.
 approximately 24.0% of the net proceeds, or HK$1,111.4 million, will be used
to enrich the technology platform for PCB equipment and diversify our
product portfolio. Specifically:
 approximately 12.0%, or HK$555.7 million, will be used to continuously
upgrade our technology platform for advanced PCB equipment. In
particular, in the next three to five years, we will focus on the research
and development of high-speed, high-multilevel and high-reliability PCB
equipment technologies required by AI servers. By enhancing the
architectural design of our PCB equipment technology platform and
optimizing system integration, we aim to achieve more efficient
coordination between hardware and software, which will enable us to
meet the stringent requirements of AI servers, including ultra-high data
FUTURE PLANS AND USE OF PROCEEDS
– 399 –


--- page 410 ---
transmission rates, robust power delivery and superior thermal
management. In addition, to strengthen our R&D capabilities, we plan to
procure advanced specialized hardware and software.
 approximately 8.0%, or HK$370.5 million, will be used for the R&D of
high-density and high-reliability packaging solutions for new energy
automotive power systems and intelligent driving domain controllers. In
particular, over the next three to five years, we intend to invest in the
development of advanced process equipment, increase such equipment’s
packaging density and enhance its long-term reliability under harsh
conditions. Simultaneously, we will focus on developing processing
technologies for new materials, such as high temperature substrate
material for high power electronic control system, to meet the sensor
fusion needs of high frequency high-speed packaging material. Such
improvement will enable precision processing and performance
optimization across different materials, providing more reliable
equipment solutions for the new energy vehicle and intelligent driving
sectors.
 approximately 4.0%, or HK$185.2 million, will be used to continuously
strengthen the R&D of our core technologies. We intend to focus on the
R&D of high-frequency high-speed material processing and HLC+HDI
market-related technology. Through the research and development of
proprietary high-precision laser processing technology and advanced
control system, we aim to continuously improve processing precision
and efficiency, equipment performance and reliability. Simultaneously,
we will continue to explore the development of intelligent detection
technology, using innovative optical detection architecture and upgraded
algorithm design, to create high-precision and efficient testing platform.
 approximately 16.0%, or HK$740.9 million, will be invested in the R&D of
our products to further diversify our product portfolio and actively help us
expand into the high-end market.
 approximately 12.0%, or HK$555.7 million, will be used in the research
and development of new generation advanced specialized PCB
equipment. New generation advanced PCB equipment will achieve
extremely high alignment accuracy of ≤±5µm in processing capability to
meet the demanding interconnection density requirements of AI servers
and intelligent driving main control boards. In terms of productivity,
through multi-axis linkage and high-speed real-time positioning
FUTURE PLANS AND USE OF PROCEEDS
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--- page 411 ---
technology, we target to increase processing efficiency by more than
30% to increase the production rhythm of high-end PCBs such as large
AI server superchips. On the intelligence front, the equipment will
integrate multi-dimensional real-time monitoring systems, enabling
online inspection and adaptive adjustment of process parameters,
transforming the equipment from passive execution to proactive
optimization, ensuring consistency in mass production. In terms of
system collaboration, we endeavor to break through the limitations of
the single machine and strive to achieve the deep collaboration between
the hardware and software of multiple modules, thereby providing
customers with high efficiency, less-delayed smart-line solutions. Based
on the abovementioned technology, we aim to develop a new generation
of advanced specified PCB equipment for AI servers and new energy
vehicles. In addition, we plan to continuously upgrade our existing
product portfolios to remain competitive in the evolving market. We plan
to recruit and build an international R&D team of approximately 200 to
250 top R&D talents. We also plan to customize core components and
optimize equipment designing with distributions to further enrich our
product portfolios.
 approximately 4.0%, or HK$185.2 million, will be used to strengthen the
technical compatibility of equipment in overseas markets. We will
promote the localization of advanced equipment in overseas markets and
continue to develop new generation specialized PCB equipment that
aligns with international standards. Through in-depth market research,
we aim to understand local markets and key customer needs, optimize
equipment performance and improve equipment intelligence, thereby
making products better tailored to meet local production needs.
 approximately 5.0% of the net proceeds, or HK$231.5 million, will be used to
expand our overseas products sales and marketing capabilities and improve our
global distribution channels and sales networks, in order to increase our brand’s
global recognition. We intend to recruit overseas sales representatives and sales
managers with global vision and overseas experience. We also intend to set up
product showrooms, participate in local product exhibitions and meetings and
conduct business and commercial negotiations with customers and suppliers.
Specifically, we plan to recruit 50 to 70 sales personnel responsible for market
development, customer acquisition, client relationship management and handling
contracts and orders. Such personnel should have at least three years’ industry
sales experience, be fluent in English, possess a professional appearance and
demeanour and hold a bachelor’s degree or above.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 412 ---
 approximately 5.0% of the net proceeds, or HK$231.5 million, will be used to
establish after-sales service teams dedicated to technical and spare parts support
and fund related after-sales activities, such as customer visits, to ensure prompt
responses to local customer needs, thereby enhancing customer loyalty and brand
recognition. In particular, we expect to recruit approximately 80 to 100 after-sales
professionals responsible for after-sale maintenance. Such personnel should have at
least two years’ experience in specialized equipment for the electronics industry
and hold a bachelor’s degree or above.
 approximately 40.0% of the net proceeds, or HK$1,852.3 million, will be used in
improving the production capacity for specialized PCB equipment. To seize the trend in
China’s PCB industry moving towards high-end and precision development and to meet
domestic and overseas customer’ demand for advanced technical requirement of PCB
production equipment, we expect to increase our production capacity for specialized
PCB equipment in China. We intend to focus on the production and R&D of advanced
specialized PCB equipment, with an aim to achieve an annual production capacity of
approximately 400 specialized PCB equipment, including approximately 290 mechanical
processing equipment, approximately 40 new generation laser processing equipment,
approximately 35 high-resolution laser direct imaging equipment and approximately 35
high-precision inspection equipment. At this stage, we expect that our new production
facility in China will commence operation by the end of 2027, and the equipment to be
produced at this facility will be priced between RMB1.5 million and RMB8.0 million.
We plan to lease a production facility with a total gross floor area that meets the
planned operational requirements, and have conducted a payback-period and a
break-even analysis. The analysis is based on a project plan that conforms to the
technical standards of China and is tailored to the specific production processes required
for advanced PCB production equipment. In our analysis, we considered key criteria,
including the investment structure and funding, the cost structure, the operational and
financial projections, and came to the conclusion that the financial indicators, including
the total investment return rate, the net profit margin and the internal rate of return,
demonstrated profitability and value creation, while the payback periods indicate a
healthy recovery of the initial investment. Our production utilization rate is expected to
remain above 70% upon full operation.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 413 ---
Equipment to be produced will feature enhanced precision and advanced technical
specifications, such as enhanced alignment accuracy, higher resolution and smaller
drilling diameter, among others. These technical upgrades will require increased
investment in both technology and the procurement of raw materials and consumables,
leading to higher production costs. At the same time, the improved performance and
precision of the new equipment will justify a higher selling price, enabling us to capture
greater value within the high-end market segment. As a result, our improved production
capacity is expected to have a relatively large and positive impact on our total revenue.
 approximately 20.0% of the net proceeds, or HK$926.1 million, will be used for
the procurement of raw materials and consumables and additional production
equipment and devices. In particular, we intend to procure core raw materials and
key consumables in the initial stage of productions, including spindles, control
systems, lasers, galvanometers, worktables, sheet metal parts and machined parts.
Timely stocking of core raw materials and key consumables is fundamental to
ensuring consistent product performance, stable production processes and rapid
ramp-up of initial production capacity. In addition, we intend to procure necessary
production equipment and testing devices to optimize key manufacturing stages.
Such procurement comprehensively enhances the level of production automation
and improves the reliability of product quality.
 approximately 15.0% of the net proceeds, or HK$694.6 million, will be used to
recruit production personnel and other supporting staff. We intend to hire
approximately 370 staff, comprising (i) approximately 320 production staff
responsible for formulating production plans based on orders or market demand to
ensure timely delivery, optimizing production processes to improve efficiency and
reduce wastage, and implementing quality standards to ensure products meet
customer or industry specifications. Such personnel should have at least one year’s
experience in industrial equipment assembly and preferably have obtained relevant
certifications such as electrician or machining certificates; (ii) approximately 40
technical staff responsible for providing technical support related to manufacturing
procedures and production processes. Such personnel should have at least one
year’s experience in industrial equipment industry, hold a bachelor’s degree or
above and preferably with background in mechanical engineering, electrical
engineering, or other related areas; and (iii) approximately 10 administrative staff
responsible for daily administrative management, including managing company
licenses, records and office supplies and coordinating meetings. Such personnel
should have experience in human resources or administrative management and
preferably have a background in human resources and sociology.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 414 ---
 approximately 5.0% of the net proceeds, or HK$231.5 million, will be used to
comprehensively enhance our global supply chain and operational capability.
Specifically, we intend to:
(i) build an integrated supply chain digital platform. We will deploy a
cloud-based global supply chain collaboration system and recruit 20 to 30
personnel responsible for procurement, material control and supplier
management. We aim to enable real-time visibility and dynamic optimisation
across the entire supply chain process — from sales orders and production
material planning to channel inventory and regional logistics distribution. We
aim to increase efficiency in cross-regional production and sales coordination
and strengthen our ability to respond quickly to customer needs.
(ii) strengthen global supply chain resource integration and localized support.
Leveraging our operational experience in overseas markets, we will assist our
long-term core Chinese suppliers in establishing local services and capacity
support systems in key overseas markets. These suppliers typically maintain
long-standing cooperative relationship with us and are our important partners
in helping us improve technical processes, cost control and product quality in
the specialized PCB equipment industry. By promoting collaborative supply
chain expansion overseas, we aim to optimise global delivery efficiency,
reduce cross-border logistics and tariff costs, and enhance our overall
competitiveness in the global market.
(iii) establish a multi-region backup supplier system. In addition to our existing
supply base, we will systematically develop and certify local suppliers
overseas, thereby establishing a diversified source of key material supply.
This will strengthen the resilience of our supply chain, reduce reliance on
single regions and ensure the continuous and stable operation of our global
business.
(iv) improve sustainability across the entire supply chain. We will retain third
parties to provide ESG training and risk assessments for major suppliers and
gradually implement green procurement policies, with an aim to
systematically enhance the environmental and social responsibility
performance of the entire supply chain, thereby meeting the sustainability
requirements of international customers and regulatory bodies.
 approximately 10.0% of the net proceeds, or HK$463.1 million, will be used as working
capital and for general corporate uses to support our daily operations and future
business development.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 415 ---
If we set the final Offer Price to be below the maximum Offer Price, we will reduce the
allocation of the net proceeds to the above purposes on a pro rata basis.
The additional net proceeds that we would receive if the Over-allotment Option were
exercised in full would be HK$699.5 million (assuming the maximum Offer Price of HK$95.80 per
Share).
To the extent that the net proceeds from the Global Offering are either more or less than
expected, we will adjust our allocation of the net proceeds for the above purposes on a pro rata
basis, but the proportion dedicated to research and development will be maintained at a reasonable
level to ensure our core technologies’ competitiveness.
We do not expect to rely on the net proceeds of the Global Offering to carry on our ordinary
business operations. While the net proceeds from the Global Offering are expected to cover the
majority of the capital expenditure associated with our above mentioned expansion plans, to the
extent that the net proceeds of the Global Offering are not sufficient to fund our development plan,
we intend to fund the shortfall through a variety of means, including proceeds from cash generated
from operation.
To the extent that the net proceeds of the Global Offering are not immediately used for the
above purposes, we will only deposit such funds into short-term interest-bearing accounts at
licensed commercial banks and/or other authorized financial institutions (as defined under the
Securities and Futures Ordinance or the applicable laws and regulations in other jurisdictions). In
such event, we will comply with the appropriate disclosure requirements under the Listing Rules.
If any part of our development plan does not proceed as planned for reasons such as changes
in government policies that would hinder the development of any of our projects, or the occurrence
of force majeure events, the Directors will carefully evaluate the situation and may reallocate the
net proceeds from the Global Offering.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 416 ---
HONG KONG UNDERWRITERS
China International Capital Corporation Hong Kong Securities Limited
Deutsche Bank AG, Hong Kong Branch
Sinolink Securities (Hong Kong) Company Limited
SDIC Securities (Hong Kong) Limited
ABCI Securities Company Limited
UNDERWRITING
This Prospectus is published solely in connection with the Hong Kong Public Offering. The
Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters on a conditional
basis. The Company expects the International Offering to be fully underwritten by the International
Underwriters. If, for any reason, the Offer Price is not agreed between the Sponsor-Overall
Coordinator (for itself and on behalf of the Underwriters) and the Company, the Global Offering
will not proceed and will lapse.
The Global Offering comprises the Hong Kong Public Offering of initially 5,045,200 Hong
Kong Offer Shares and the International Offering of initially 45,406,600 International Offer
Shares, subject, in each case, to reallocation on the basis as described in “Structure of the Global
Offering” in this Prospectus as well as to the Over-allotment Option (in the case of the
International Offering).
UNDERWRITING ARRANGEMENTS AND EXPENSES
Hong Kong Public Offering
Hong Kong Underwriting Agreement
Pursuant to the Hong Kong Underwriting Agreement, the Company is offering the Hong
Kong Offer Shares for subscription on the terms and conditions set out in this Prospectus and the
Hong Kong Underwriting Agreement at the Offer Price.
Subject to (a) the Stock Exchange granting approval for the listing of, and permission to deal
in, the H Shares to be issued pursuant to the Global Offering (including the H Shares which may
be issued pursuant to the exercise of the Over-allotment Option), on the Main Board of the Stock
Exchange and such approval not having been withdrawn and (b) certain other conditions set out in
the Hong Kong Underwriting Agreement, the Hong Kong Underwriters have agreed severally but
not jointly to procure subscribers for, or themselves to subscribe for, their respective applicable
UNDERWRITING
– 406 –


--- page 417 ---
proportions of the Hong Kong Offer Shares being offered which are not taken up under the Hong
Kong Public Offering on the terms and conditions set out in this Prospectus and the Hong Kong
Underwriting Agreement.
The Hong Kong Underwriting Agreement is conditional on, among other things, the
International Underwriting Agreement having been executed and becoming unconditional and not
having been terminated in accordance with its terms.
Grounds for Termination
If any of the events set out below occur at any time prior to 8:00 a.m. on the Listing Date,
the Sponsor-Overall Coordinator (for itself and on behalf of the Hong Kong Underwriters) in their
sole and absolute discretion, shall have the right by giving a notice to the Company to terminate
the Hong Kong Underwriting Agreement with immediate effect:
(a) there develops, occurs, exists or comes into force:
(i) any new law or regulation or any change or development involving a prospective
change or any event or series of events or circumstances likely to result in a
change or a development involving a prospective change in existing laws or
regulations, or the interpretation or application thereof by any court or any
competent authority in or affecting Hong Kong, the PRC, the United States, the
United Kingdom, the European Union (or any member thereof) and Singapore, or
other jurisdictions relevant to the Group or the Global Offering (each a “ Relevant
Jurisdiction ” and collectively, the “ Relevant Jurisdictions ”); or
(ii) any change or development involving a prospective material change, or any event
or series of events or circumstances likely to result in a material change or
prospective change, in any local, national, regional or international financial,
political, military, industrial, economic, fiscal, legal, regulatory, currency, credit or
market conditions or sentiments, taxation, equity securities or currency exchange
rate or controls or any monetary or trading settlement system, or foreign
investment regulations (including, without limitation, a significant devaluation of
the Hong Kong dollar, United States dollar or Renminbi against any foreign
currencie s , a change in the system under which the value of the Hong Kong dollar
is linked to that of the United States dollar) or other financial markets (including,
without limitation, conditions in stock and bond markets, money and foreign
exchange markets, the inter-bank markets and credit markets) in or affecting any
Relevant Jurisdictions, or affecting an investment in the Offer Shares; or
UNDERWRITING
– 407 –


--- page 418 ---
(iii) any event or series of events, or circumstances in the nature of force majeure
(including, without limitation, any acts of government, declaration of a regional,
national or international emergency or war, calamity, crisis, economic sanctions,
strikes, other industrial actions, lock-outs, fire, explosion, flooding, tsunami,
earthquake, volcanic eruption, civil commotion, riots, rebellion, public disorder,
paralysis in government operations, acts of war, epidemic, pandemic, outbreak or
escalation, mutation or aggravation of diseases, accident or interruption or delay in
transportation, local, national, regional or international outbreak or escalation of
hostilities (whether or not war is or has been declared), act of God or act of
terrorism (whether or not responsibility has been claimed)) in or affecting any of
the Relevant Jurisdictions; or
(iv) the imposition or declaration of any moratorium, suspension or limitation
(including without limitation, any imposition of or requirement for any minimum
or maximum price limit or price range) on (A) the trading in shares or equity
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 (B) the trading in any securities of the
Company listed or quoted on a stock exchange or an over-the-counter market; or
(v) the imposition or declaration of any general moratorium on commercial banking
activities in or affecting any of the Relevant Jurisdictions or any disruption in
commercial banking or foreign exchange trading or securities settlement or
clearing services, procedures or matters in or affecting any of the Relevant
Jurisdictions; or
(vi) other than with the prior written consent of the Sponsor-Overall Coordinator, the
issue or requirement to issue by the Company of a supplement or amendment to
this Prospectus or other documents in connection with the offer and sale of the
Offer Shares pursuant to the Companies (Winding up and Miscellaneous
Provisions) Ordinance or the Listing Rules or upon any requirement or request of
the Stock Exchange and/or the SFC; or
(vii) the commencement by any authority or other regulatory or political body or
organization of any public action or investigation against a member of the Group
or a director or a senior management member of any member of the Group or
announcing an intention to take any such action; or
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(viii) the imposition of sanctions or export controls in whatever form, directly or
indirectly, on any member of the Group or any member of the Controlling
Shareholders Group or by or on any Relevant Jurisdiction, or the withdrawal of
trading privileges which existed on the date of the Hong Kong Underwriting
Agreement, in whatever form, directly or indirectly, by, or for, any Relevant
Jurisdiction; or
(ix) any valid demand by creditors for payment or repayment of 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 non-compliance of this Prospectus (or any other
documents used in connection with the contemplated offering, allotment, issue,
subscription or sale of any of the Offer Shares), the CSRC Filings (as defined in
the Hong Kong Underwriting Agreement) or any aspect of the Global Offering with
the Listing Rules or any other applicable laws; or
(x) any litigation, dispute, legal action or claim or regulatory or administrative
investigation or action being threatened, instigated or announced against any
member of the Group or any member of the Controlling Shareholders Group or any
Director (which in the case of an independent non-executive Director with respect
to his/her action as independent non-executive Director of the Company) or senior
management members as named in this Prospectus; or
(xi) any contravention by any member of the Group or any Director of the Listing
Rules or applicable laws; or
(xii) any Director or any member of senior management of the Company named in this
Prospectus is prohibited by operation of law or otherwise disqualified from taking
part in the management or taking directorship of a company; or
(xiii)an order or petition is presented for the winding-up or liquidation of any member
of the Group, or any member of the Group makes any composition or arrangement
with its creditors or enters into a scheme of arrangement or any resolution is
passed for the winding-up of any member of the Group or a provisional liquidator,
receiver or manager is appointed over all or part of the assets or undertaking of
any member of the Group or anything analogous thereto occurs in respect of any
member of the Group;
which, in any such case individually or in the aggregate, in the sole and absolute opinion of
the Sole Sponsor and/or the Sponsor-Overall Coordinator (for itself and on behalf of the
Hong Kong Underwriters): (A) has or will or may have a Material Adverse Effect (as defined
UNDERWRITING
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in the Hong Kong Underwriting Agreement); 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 indications of interest under the International
Offering; or (C) makes or will make or may make it impracticable, inadvisable, inexpedient
or incapable for any material part of the Hong Kong Underwriting Agreement, the Hong
Kong Public Offering or the Global Offering to be performed or implemented as envisaged,
or for the Hong Kong Public Offering and/or 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 Documents (as defined in the Hong Kong Underwriting
Agreement); or (D) has or will or may have the effect of making any part of this Agreement
(including underwriting) incapable of performance in accordance with its terms or preventing
the processing of applications and/or payments pursuant to the Global Offering or pursuant to
the underwriting thereof; or
(b) there has come to the notice of the Sole Sponsor and/or the Sponsor-Overall Coordinator
(for itself and on behalf of the Hong Kong Underwriters) that:
(i) any statement contained in any of the Offering Documents, the Operative
Documents, the CSRC Filings and/or any notices, announcements, advertisements,
communications or other documents issued or used by or on behalf of the
Company in connection with the Global Offering (including any supplement or
amendment thereto) (the “ Global Offering Documents ”) was, when it was issued,
or has become untrue, incorrect, inaccurate or incomplete in any material respect
or misleading; or that any estimate, forecast, expression of opinion, intention or
expectation contained in any such documents, was, when it was issued, or has
become unfair or misleading in any material respect or based on untrue, dishonest
or unreasonable assumptions or given in bad faith; or
(ii) 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
omission or misstatement in any Global Offering Document; or
(iii) any material breach of, or any event or circumstance rendering untrue or incorrect
or incomplete or misleading in any respect, any of the representations, warranties
and undertakings given by the Company or the Controlling Shareholders Group in
the Hong Kong Underwriting Agreement or the International Underwriting
Agreement; or
UNDERWRITING
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(iv) any event, act or omission which gives rise 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 indemnities in the Hong Kong Underwriting Agreement
or the International Underwriting Agreement (including any supplement or
amendment thereto), as applicable; or
(v) any material breach of any of the obligations or undertakings imposed upon the
Company or any member of the Controlling Shareholders Group or any cornerstone
investor (as applicable) to the Hong Kong Underwriting Agreement, the
International Underwriting Agreement or the cornerstone investment agreements; or
(vi) there is any change or development involving a prospective change, constituting or
having a Material Adverse Effect; or
(vii) that the chairman of the Board, any Director or any member of senior management
of the Company named in this Prospectus seeks to retire, or is removed from office
or vacating his/her office; or any Director or any member of senior management of
the Company named in this Prospectus is being charged with an indictable offence
or prohibited by operation of law or otherwise disqualified from taking part in the
management or taking directorship of a company; or
(viii) the Company withdraws this Prospectus (and/or any other documents used in
connection with the subscription or sale of any of the Offer Shares pursuant to the
Global Offering) or the Global Offering; or
(ix) that the approval by the Listing Committee of the listing of, and permission to deal
in, the H Shares in issue and to be issued pursuant to the Global Offering
(including pursuant to any exercise of the Over-allotment Option) 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, cancelled, qualified (other
than by customary conditions), revoked or withheld; or
(x) any person (other than the Sole Sponsor) has withdrawn its consent to the issue of
this Prospectus or any of the Offering Documents with the inclusion of its reports,
letters and/or legal opinions (as the case may be) and references to its name
included in the form and context in which it respectively appears; or
(xi) any 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
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(xii) (A) the notice of acceptance of the CSRC Filings issued by the CSRC and/or the
results of the CSRC Filings published on the website of the CSRC is rejected,
withdrawn, revoked or invalidated; or (B) other than with the prior written consent
of the Sponsor-Overall Coordinator, the issue or requirement to issue by the
Company of a supplement or amendment to the CSRC Filings pursuant to the
CSRC Rules or upon any requirement or request of the CSRC; or (C) any
non-compliance of the CSRC Filings with the CSRC Rules or any other applicable
Laws in any material respects; or
(xiii) that (A) a material portion of the orders placed or confirmed in the bookbuilding
process or (B) any investment commitment made by any cornerstone investors
under the cornerstone investment agreements signed with such cornerstone
investors, have been withdrawn, terminated or cancelled, or with respect to which
the payment of the relevant orders and/or investment commitment has not been
received or settled in the stipulated time and manner or otherwise,
then, in each case, the Sole Sponsor and the Sponsor-Overall Coordinator (for itself and on
behalf of the Hong Kong Underwriters) may, in their sole and absolute discretion and upon
giving notice in writing to the Company, terminate the Hong Kong Underwriting Agreement
with immediate effect.
Undertakings to the Stock Exchange pursuant to the Listing Rules
Undertakings by the Controlling Shareholders Group
Pursuant to Rule 10.07 of the Listing Rules, each member of the Controlling Shareholders
Group has undertaken to the Stock Exchange and the Company that, he/it will not and will procure
that the relevant registered holder(s) will not without the prior written consent of the Stock
Exchange or unless otherwise in compliance with the applicable requirement of the Listing Rules:
(a) in the period commencing on the date by reference to which disclosure of his/its
shareholdings in the Company is made in this Prospectus and ending on the date which
is six months from the Listing Date (the “ First Six-Month Period ”), either directly or
indirectly, dispose of, nor enter into any agreement to dispose of or otherwise create any
options, rights, interests or encumbrances in respect of, any of the securities of the
Company in respect of which he/it is shown by this Prospectus to be the beneficial
owner(s); and
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(b) in the period of six months from the expiry of the First Six-Month Period, either
directly or indirectly, dispose of, nor enter into any agreement to dispose of or otherwise
create any options, rights, interests or encumbrances in respect of, any of the securities
referred to in paragraph (a) above if, immediately following such disposal or upon the
exercise or enforcement of such options, rights, interests or encumbrances, he/it would
cease to be a controlling shareholder (as defined under the Listing Rules).
Note 2 to Rule 10.07(2) of the Listing Rules provides that the foregoing shall not prevent
members of the Controlling Shareholders Group from using securities of the Company beneficially
owned by them as security (including a charge or a pledge) in favor of an authorized institution (as
defined in the Banking Ordinance (Chapter 155 of the Laws of Hong Kong)) for a bona fide
commercial loan.
Pursuant to Note 3 to Rule 10.07(2) of the Listing Rules, each member of the Controlling
Shareholders Group has undertaken to the Stock Exchange and the Company that, within the
period commencing on the date by reference to which disclosure of the shareholding of the
Controlling Shareholder in the Company is made in this Prospectus and ending on the date which
is 12 months from the Listing Date, he/it will and will procure that the relevant registered
holder(s) will:
(i) when he/it pledges or charges any securities of the Company beneficially owned by
him/it in favour of an authorized institution (as defined in the Banking Ordinance
(Chapter 155 of the Laws of Hong Kong)) pursuant to Note 2 to Rule 10.07 of the
Listing Rules, immediately inform the Company of such pledge or charge together with
the number of securities so pledged or charged; and
(ii) when he/it receives indications, either verbal or written, from the pledgee or chargee of
any securities of the Company that any of the pledged or charged securities will be
disposed of, immediately inform the Company of such indications.
The Company will inform the Stock Exchange as soon as it has been informed of the matters
referred to in paragraphs (i) and (ii) above by the Controlling Shareholders Group and subject to
the then applicable requirements of the Listing Rules disclose such matters by way of an
announcement.
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Undertakings pursuant to the Hong Kong Underwriting Agreement
Undertakings by the Company
Except for the issue, offer or sale of the Offer Shares by the Company pursuant to the Global
Offering (including pursuant to the Over-allotment Option), at any time after the date of the Hong
Kong Underwriting Agreement up to and including the date falling six months after the Listing
Date (the “ Relevant Period ”), it will not, without the prior written consent of the Sole Sponsor
and the Sponsor-Overall Coordinator (for itself and on behalf of the Hong Kong Underwriters) and
unless in compliance with the requirements of the Listing Rules:
(i) allot, issue, sell, accept subscription for, offer to allot, issue or sell, contract or agree to
allot, issue or sell, assign, 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 over, or agree to transfer or dispose of or create an
encumbrance over, either directly or indirectly, conditionally or unconditionally, or
repurchase, any legal or beneficial interest in the share capital, any Shares or any other
securities of the Company or any interest in any of the foregoing (including, without
limitation, any securities convertible into or exchangeable or exercisable for or that
represent the right to receive, or any warrants or other rights to purchase any share
capital, Shares or other securities of the Company, as applicable), or deposit any share
capital, Shares or other securities of the Company, as applicable, with a depositary in
connection with the issue of depositary receipts; or
(ii) enter into any swap or other arrangement that transfers to another, in whole or in part,
any of the economic consequences of ownership (legal or beneficial) of the Shares or
any other securities of the Company, or any interest in any of the foregoing (including,
without limitation, any securities convertible into or exchangeable or exercisable for or
that represent the right to receive, or any warrants or other rights to purchase, any H
Shares); or
(iii) enter into any transaction with the same economic effect as any transaction described in
paragraphs (i) or (ii) above; or
(iv) offer to or agree to do any of the foregoing specified in paragraphs (i), (ii) or (iii) or
announce any intention to do so,
UNDERWRITING
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in each case, whether any of the foregoing transactions is to be settled by delivery of share capital,
H Shares or such other securities, in cash or otherwise (whether or not the issue of such share
capital or other securities will be completed within the Relevant Period). In the event the Company
is allowed to enter into any of the transactions described in paragraphs (i), (ii) or (iii) above or
offers to or agrees to or announces any intention to effect any such transaction during the period of
six months commencing on the date on which the Relevant Period expires, it will take all
reasonable steps to ensure that such an issue or disposal will not, and no other act of the Company
will, create a disorderly or false market for any Shares or other securities of the Company.
Hong Kong Underwriters’ Interests in the Company
Save for their respective obligations under the Hong Kong Underwriting Agreement, as of the
Latest Practicable Date, none of the Hong Kong Underwriters was interested, legally or
beneficially, directly or indirectly, in any H Shares or any securities of any member of the Group
or had any right or option (whether legally enforceable or not) to subscribe for or purchase, or to
nominate persons to subscribe for or purchase, any H Shares or any securities of any member of
the Group.
Following the completion of the Global Offering, the Hong Kong Underwriters and their
affiliated companies may hold a certain portion of the Company’s H Shares as a result of fulfilling
their respective obligations under the Hong Kong Underwriting Agreement.
International Offering
International Underwriting Agreement
In connection with the International Offering, the Company expects to enter into the
International Underwriting Agreement with, among others, the Sole Sponsor, the Sponsor-Overall
Coordinator and the International Underwriters on or around the Price Determination Date. Under
the International Underwriting Agreement and subject to the Over-allotment Option, the
International Underwriters would, subject to certain conditions set out therein, agree severally but
not jointly to procure subscribers for, or themselves to subscribe for, their respective applicable
proportions of the International Offer Shares initially being offered pursuant to the International
Offering. It is expected that the International Underwriting Agreement may be terminated on
similar grounds as the Hong Kong Underwriting Agreement. Potential investors should note that in
the event that the International Underwriting Agreement is not entered into, the Global Offering
will not proceed. See “Structure of the Global Offering — The International Offering.”
UNDERWRITING
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Over-allotment Option
The Company is expected to grant to the International Underwriters the Over-allotment
Option, exercisable by the Sponsor-Overall Coordinator on behalf of the International Underwriters
at any time from the Listing Date until 30 days after the last day for lodging applications under the
Hong Kong Public Offering, pursuant to which the Company may be required to issue up to an
aggregate of 7,567,700 H Shares, representing not more than 15% of the number of Offer Shares
initially available under the Global Offering, at the Offer Price, to cover over-allocations in the
International Offering, if any. See “Structure of the Global Offering — Over-allotment Option.”
Commissions and Expenses
The Capital Market Intermediaries will receive an underwriting commission of 2.5% of the
aggregate Offer Price of all the Offer Shares (including any Offer Shares to be issued pursuant to
the exercise of the Over-allotment Option), out of which they will pay any sub-underwriting
commissions and other fees.
The Capital Market Intermediaries may receive a discretionary incentive fee of up to 1% of
the aggregate Offer Price of all the Offer Shares to be issued by the Company under the Global
Offering (including any Offer Shares to be issued pursuant to the exercise of the Over-allotment
Option).
Assuming full payment of discretionary incentive fees, the fixed fees and discretionary fees
payable to the Underwriters represent approximately 51.8% and 48.2%, respectively, of the
aggregated fees payable to the Capital Market Intermediaries in connection with the Global
Offering.
For any unsubscribed Hong Kong Offer Shares reallocated to the International Offering, the
underwriting commission will not be paid to the Hong Kong Underwriters but will instead be paid,
at the rate applicable to the International Offering, to the relevant International Underwriters.
The aggregate underwriting commissions payable to the Capital Market Intermediaries in
relation to the Global Offering (assuming an indicative Offer Price of HK$95.80 per Offer Share
(which is the maximum Offer Price), the full payment of the discretionary incentive fee and the
exercise of the Over-allotment Option in full) will be approximately HK$194.54 million.
The aggregate underwriting commissions and fees together with the Stock Exchange listing
fees, the SFC transaction levy, the AFRC transaction levy and the Stock Exchange trading fee,
legal and other professional fees and printing and all other expenses relating to the Global
Offering are estimated to be approximately HK$228.06 million (assuming an indicative Offer Price
UNDERWRITING
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of HK$95.80 per Offer Share (which is the maximum Offer Price), the full payment of the
discretionary incentive fee and the exercise of the Over-allotment Option in full) and will be paid
by the Company.
Indemnity
The Company has agreed to indemnify the Hong Kong Underwriters for certain losses which
they may suffer or incur, including losses arising from their performance of their obligations under
the Hong Kong Underwriting Agreement and any breach by the Company of the Hong Kong
Underwriting Agreement.
ACTIVITIES BY SYNDICATE MEMBERS
The underwriters of the Hong Kong Public Offering and the International Offering (together,
the “ Syndicate Members ”) and their affiliates may each individually undertake a variety of
activities (as further described below) which do not form part of the underwriting or 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, loan financing, 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 our assets, securities and/or instruments and/or persons and entities with relationships
with the Company and may also include swaps and other financial instruments entered into for
hedging purposes in connection with the 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, including as a lender to initial purchasers of the H
Shares (which financing may be secured by the H Shares) in the Global Offering, proprietary
trading in the H Shares, and entering into over the counter or listed derivative transactions or
listed or unlisted securities transactions (including issuing securities such as derivative warrants
listed on a stock exchange) which have as their underlying assets, assets including the H Shares.
Such transactions may be carried out as bilateral agreements or trades with selected counterparties.
Those activities may require hedging activity by those entities involving, directly or indirectly, the
buying and selling of the H Shares, which may have a negative impact on the trading price of the
UNDERWRITING
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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 underlying securities, whether on the Stock Exchange or on any other stock
exchange, the rules of the stock exchange may require the issuer of those securities (or one of its
affiliates or agents) to act as a market maker or liquidity provider in the security, and this will also
result in hedging activity in the H Shares in most cases.
All such activities may occur both during and after the end of the stabilizing period described
in “Structure of the Global Offering.” Such 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 the price of the H
Shares, and the extent to which this occurs from day to day cannot be estimated.
It should be noted that when engaging in any of these activities, the Syndicate Members will
be subject to certain restrictions, including the following:
 the Syndicate Members (other than the Stabilizing Manager 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
 the Syndicate Members must comply with all applicable laws and regulations, including
the market misconduct provisions of the SFO, including the provisions prohibiting
insider dealing, false trading, price rigging and stock market manipulation.
Certain of the Syndicate Members or their respective affiliates have provided from time to
time, and expect to provide in the future, investment banking, loan financing and other services to
the Company and certain of its affiliates for which such Syndicate Members or their respective
affiliates have received or will receive customary fees and commissions.
In addition, the Syndicate Members or their respective affiliates may provide financing to
investors to finance their subscriptions of the Offer Shares in the Global Offering.
UNDERWRITING
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THE GLOBAL OFFERING
This Prospectus is published in connection with the Hong Kong Public Offering as part of the
Global Offering.
The listing of the H Shares on the Main Board of the Stock Exchange is sponsored by the
Sole Sponsor. The Sole Sponsor has made an application on behalf of the Company to the Stock
Exchange for the listing of, and permission to deal in, the H Shares to be issued as mentioned in
this Prospectus.
50,451,800 Offer Shares will initially be made available under the Global Offering
comprising:
 the Hong Kong Public Offering of initially 5,045,200 Offer Shares (subject to
reallocation) in Hong Kong as described in “— The Hong Kong Public Offering” below;
and
 the International Offering of initially 45,406,600 Offer Shares (subject to reallocation
and the Over-allotment Option) (i) in the United States solely to QIBs in reliance on
Rule 144A or another exemption from, or in a transaction not subject to, the registration
requirements of the U.S. Securities Act and (ii) outside the United States in offshore
transactions in reliance on Regulation S, as described in “— The International Offering”
below.
Investors may either (i) apply for Hong Kong Offer Shares under the Hong Kong Public
Offering; or (ii) apply for or indicate an interest for International Offer Shares under the
International Offering, but may not do both.
The Offer Shares will represent approximately 10.60% of the enlarged issued share capital of
the Company immediately following the completion of the Global Offering, assuming the
Over-allotment Option is not exercised and no other changes are made to the total issued share
capital of our Company between the Latest Practicable Date and the Listing Date. If the
Over-allotment Option is exercised in full and no other changes are made to the total issued share
capital of our Company between the Latest Practicable Date and the Listing Date, the Offer Shares
will represent approximately 12.00% of the enlarged issued share capital of the Company
immediately following the completion of the Global Offering.
References in this Prospectus to applications, application monies or the procedure for
applications relate solely to the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
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THE HONG KONG PUBLIC OFFERING
Number of Offer Shares initially offered
The Company is initially offering 5,045,200 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 number of Offer Shares initially offered under
the Hong Kong Public Offering, subject to any reallocation of Offer Shares between the
International Offering and the Hong Kong Public Offering, will represent approximately 1.06% of
the enlarged issued share capital of the Company immediately following the completion of the
Global Offering (assuming the Over-allotment Option is not exercised and no other changes are
made to the total issued share capital of our Company between the Latest Practicable Date and the
Listing Date).
The Hong Kong Public Offering is open to members of the public in Hong Kong as well as to
institutional and professional investors. Professional investors generally include brokers, dealers,
companies (including fund managers) whose ordinary business involves dealing in shares and other
securities and corporate entities that regularly invest in shares and other securities.
Completion of the Hong Kong Public Offering is subject to the conditions set out in
“— 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 could mean
that some applicants may receive a higher allocation than others who have applied for the same
number of Hong Kong Offer Shares, and those applicants who are not successful in the ballot may
not receive any Hong Kong Offer Shares.
For allocation purposes only, the total number of Hong Kong Offer Shares available under the
Hong Kong Public Offering (after taking into account any reallocation referred to below) will be
divided equally into two pools: pool A and pool B, with any odd board lots being allocated to Pool
A. The Hong Kong Offer Shares in pool A will be allocated on an equitable basis to valid
applicants who have applied for Hong Kong Offer Shares with an aggregate subscription price of
HK$5 million (excluding the brokerage, the SFC transaction levy, the AFRC transaction levy and
the Stock Exchange trading fee payable) or less. The Hong Kong Offer Shares in pool B will be
allocated on an equitable basis to valid applicants who have applied for Hong Kong Offer Shares
STRUCTURE OF THE GLOBAL OFFERING
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--- page 431 ---
with an aggregate subscription price of more than HK$5 million (excluding the brokerage, the SFC
transaction levy, the AFRC transaction levy and the 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 any Hong Kong Offer Shares in one (but not both) of the pools are
unsubscribed, such unsubscribed Hong Kong Offer Shares will be transferred to the other pool to
satisfy demand in that other pool and be allocated accordingly. For the purpose of the immediately
preceding paragraph only, the “price” for Hong Kong Offer Shares means the price payable on
application therefor (without regard to the Offer Price as finally determined). Applicants can only
receive an allocation of Hong Kong Offer Shares from either pool A or pool B and not from both
pools. Multiple or suspected multiple applications under the Hong Kong Public Offering and any
application for more than 2,522,600 Hong Kong Offer Shares (50% of the Hong Kong Offer
Shares initially available under the Hong Kong Public Offering) is liable to be rejected.
Reallocation
The Offer Shares to be offered in the Hong Kong Public Offering and the International
Offering may, in certain circumstances, be reallocated as between these offerings at the discretion
of the Sponsor-Overall Coordinator. Subject to the allocation cap described in the subsequent
paragraph, the Sponsor-Overall Coordinator may in its discretion reallocate Offer Shares from the
International Offering to the Hong Kong Public Offering to satisfy valid applications under the
Hong Kong Public Offering. In addition, if the Hong Kong Public Offering is not fully subscribed,
the Sponsor-Overall Coordinator will have the discretion (but shall not be under any obligation) to
reallocate to the International Offering all or any unsubscribed Hong Kong Offer Shares in such
amounts as it deems appropriate.
In each case, the additional Offer Shares reallocated to the Hong Kong Public Offering will
be allocated between pool A and pool B and the number of Offer Shares allocated to the
International Offering will be correspondingly reduced in such manner as the Sponsor-Overall
Coordinator deems appropriate. In the event of reallocation of Offer Shares between the
International Offering and the Hong Kong Public Offering in the circumstances where (a) the
International Offer Shares are fully subscribed or oversubscribed and the Hong Kong Offer Shares
are fully subscribed or oversubscribed irrespective of the number of times, or (b) the International
Offer Shares are undersubscribed and the Hong Kong Offer Shares are fully subscribed or
oversubscribed irrespective of the number of times, then up to 2,522,500 Offer Shares may be
reallocated from the International Offering to the Hong Kong Public Offering, so that the total
number of Offer Shares available for subscription under the Hong Kong Public Offering will
STRUCTURE OF THE GLOBAL OFFERING
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--- page 432 ---
increase up to 7,567,700 Offer Shares, representing approximately 15% of the number of Offer
Shares initially available under the Global Offering (before any exercise of the Over-allotment
Option) in accordance with Chapter 4.14 of the Guide for New Listing Applicants.
Given the initial allocation of the Offer Shares to the Hong Kong Public Offering and the
International Offering follows Mechanism B set out under paragraph 2 of Chapter 4.14 of the
Guide for New Listing Applicants and the provision of Paragraph 4.2(b) of Practice Note 18 to the
Listing Rules, no mandatory clawback or reallocation mechanism is required to increase 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.
Applications
Each applicant under the Hong Kong Public Offering will be required to give an undertaking
and confirmation in the application submitted by him/her that he/she and any person(s) for whose
benefit he/she is making the application has not applied for or taken up, or indicated an interest
for, and will not apply for or take up, or indicate an interest for, any International Offer Shares
under the International Offering. Such applicant’s application under the International Offering is
liable to be rejected if such undertaking and/or confirmation is/are breached and/or untrue (as the
case may be).
Applicants under the Hong Kong Public Offering may be required to pay, on application
(subject to application channels), the maximum Offer Price in addition to the brokerage, the SFC
transaction levy, the AFRC transaction levy and the Stock Exchange trading fee payable on each
Offer Share, amounting to a total of HK$9,676.61 for one board lot of 100 Offer Shares. If the
Offer Price, as finally determined in the manner described in “— Pricing and Allocation” below, is
less than the maximum Offer Price, appropriate refund payments (including the brokerage, the SFC
transaction levy, the AFRC transaction levy and the Stock Exchange trading fee attributable to the
surplus application monies) will be made to successful applicants (subject to application channels),
without interest. Further details are set out in “How to Apply for Hong Kong Offer Shares.”
THE INTERNATIONAL OFFERING
Number of Offer Shares initially offered
The International Offering will consist of an initial offering of 45,406,600 Offer Shares
offered by the Company (subject to reallocation and the Over-allotment Option), representing
approximately 90% of the total number of Offer Shares initially available under the Global
Offering. The number of Offer Shares initially offered under the International Offering, subject to
any reallocation of Offer Shares between the International Offering and the Hong Kong Public
STRUCTURE OF THE GLOBAL OFFERING
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Offering, will represent approximately 9.54% of the enlarged issued share capital of the Company
immediately following the completion of the Global Offering (assuming the Over-allotment Option
is not exercised and no other changes are made to the total issued share capital of our Company
between the Latest Practicable Date and the Listing Date).
Allocation
The International Offering will include selective marketing of Offer Shares to QIBs in the
United States as well as institutional and professional investors and other investors anticipated to
have a sizeable demand for such Offer Shares in Hong Kong and other jurisdictions outside the
United States in reliance on Regulation S. Professional investors generally include brokers,
dealers, companies (including fund managers) whose ordinary business involves dealing in shares
and other securities and corporate entities that regularly invest in shares and other securities.
Allocation of Offer Shares pursuant to the International Offering will be effected in accordance
with the “book-building” process described in the subsection headed “Pricing and Allocation”
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 H Shares and/or hold or sell its H
Shares after the Listing. Such allocation is intended to result in a distribution of the H Shares on a
basis which would lead to the establishment of a solid professional and institutional shareholder
base to the benefit of the Group and the Shareholders as a whole.
The Sponsor-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
Sponsor-Overall Coordinator so as to allow it to identify the relevant applications under the Hong
Kong Public Offering and to ensure that such investor is excluded from any allocation of Offer
Shares under the International 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 reallocation arrangement described in “— 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.
STRUCTURE OF THE GLOBAL OFFERING
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OVER-ALLOTMENT OPTION
In connection with the Global Offering, the Company is expected to grant the Over-allotment
Option to the International Underwriters, exercisable by the Sponsor-Overall Coordinator (on
behalf of the International Underwriters).
Pursuant to the Over-allotment Option, the International Underwriters will have the right,
exercisable by the Sponsor-Overall Coordinator (on behalf of the International Underwriters) at
any time from the Listing Date until 30 days after the last day for lodging applications under the
Hong Kong Public Offering, to require the Company to issue up to an aggregate of 7,567,700
additional H Shares, representing approximately 15% of the total number of Offer Shares initially
available under the Global Offering, at the Offer Price under the International Offering to cover
over-allocations in the International Offering, if any.
If the Over-allotment Option is exercised in full and no other changes are made to the total
issued share capital of our Company between the Latest Practicable Date and the Listing Date, the
additional Offer Shares to be issued pursuant thereto will represent approximately 1.57% of the
enlarged issued share capital of the Company immediately following the completion of the Global
Offering. If the Over-allotment Option is exercised, an announcement will be made by the
Company.
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 a decline in
the initial public market price of the securities below the offer price. Such transactions may be
effected in all jurisdictions where it is permissible to do so, in each case in compliance with all
applicable laws and regulatory requirements, including those of Hong Kong. In Hong Kong, 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 transactions with a view to stabilizing or
supporting the market price of the H Shares at a level higher than that which might otherwise
prevail for a limited period after the Listing Date. However, there is no obligation on the
Stabilizing Manager (or any person acting for it) to conduct any such stabilizing action. Such
stabilizing action, if taken, (a) will be conducted at the absolute discretion of the Stabilizing
Manager (or any person acting for it) and in what the Stabilizing Manager (or any person acting
for it) reasonably regards as the best interest of the Company, (b) may be discontinued at any time
and (c) is required to be brought to an end within 30 days after the last day for lodging
applications under the Hong Kong Public Offering.
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Stabilization action permitted in Hong Kong pursuant to the Securities and Futures (Price
Stabilizing) Rules of the SFO includes (a) over-allocating for the purpose of preventing or
minimizing any reduction in the market price of the H Shares, (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
reduction in the market price of the H Shares, (c) purchasing, or agreeing to purchase, the H
Shares pursuant to the Over-allotment Option in order to close out any position established under
paragraph (a) or (b) above, (d) purchasing, or agreeing to purchase, any of the H Shares for the
sole purpose of preventing or minimizing any reduction in the market price of the H Shares, (e)
selling or agreeing to sell any H Shares in order to liquidate any position established as a result of
those purchases, and (f) offering or attempting to do anything as described in clauses (b), (c), (d)
or (e) above.
Specifically, prospective applicants for and investors in the Offer Shares should note that:
 the Stabilizing Manager (or any person acting for it) may, in connection with the
stabilizing action, maintain a long position in the H Shares;
 there is no certainty as to the extent to which and the time or period for which the
Stabilizing Manager (or any person acting for it) will maintain such a long position;
 liquidation of any such long position by the Stabilizing Manager (or any person acting
for it) and selling in the open market may have an adverse impact on the market price of
the H Shares;
 no stabilizing action can be taken to support the price of the H Shares for longer than
the stabilization period, which will begin on the Listing Date, and is expected to expire
on Thursday, March 5, 2026, being the 30th day after the last day for lodging
applications under the Hong Kong Public Offering. After this date, when no further
stabilizing action may be taken, demand for the H Shares, and therefore the price of the
H Shares, could fall;
 the price of the H Shares cannot be assured to stay at or above the Offer Price by the
taking of any stabilizing action; and
 stabilizing bids or transactions effected in the course of the stabilizing action may be
made at any price at or below the Offer Price and can, therefore, be done at a price
below the price paid by applicants for, or investors in, the Offer Shares.
The Company will ensure that an announcement in compliance with the Securities and
Futures (Price Stabilizing) Rules of the SFO will be made within seven days of the expiration of
the stabilization period.
STRUCTURE OF THE GLOBAL OFFERING
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Over-Allocation
Following any over-allocation of H Shares in connection with the Global Offering, the
Stabilizing Manager (or any person acting for it) may cover such over-allocations by exercising the
Over-allotment Option in full or in part, using H Shares purchased by the Stabilizing Manager (or
any person acting for it) in the secondary market at prices that do not exceed the Offer Price or a
combination of these means.
PRICING AND ALLOCATION
Pricing for the Offer Shares for the purpose of the various offerings under the Global
Offering will be determined on the Price Determination Date, which is expected to be on or before
Wednesday, February 4, 2026 and, in any event, no later than 12:00 noon on Wednesday, February
4, 2026, by agreement between the Sponsor-Overall Coordinator (for itself and on behalf of the
Underwriters) and the Company, and the number of Offer Shares to be allocated under the various
offerings will be determined shortly thereafter.
We will determine the Offer Price by reference to, among other factors, the closing price of
our A Shares on the Shenzhen Stock Exchange on the last trading day on or before the Price
Determination Date (which is accessible to the Shareholders and potential investors at
www.szse.cn/English/siteMarketData/siteMarketDatas/lookup/index.html?code=301200
), and
the Offer Price will not be more than HK$95.80. The historical prices of our A Shares and trading
volume on Shenzhen Stock Exchange are set out below.
Period High Low ADTV (1)
(RMB) (RMB) (A Shares)
Year ended December 31, 2022 .......... 76.56 38.31 2,051,805
Year ended December 31, 2023 .......... 49.69 34.68 860,131
Year ended December 31, 2024 .......... 42.95 26.76 1,307,696
Year ended December 31, 2025 .......... 133.00 31.62 4,588,726
Year of 2026 (up to the Latest Practicable
Date) ............................ 161.34 119.25 5,850,557
Note:
(1) Average daily trading volume (“ ADTV”) represents daily average number of our A Shares traded over the relevant
period.
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
STRUCTURE OF THE GLOBAL OFFERING
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--- page 437 ---
International Offering they would be prepared to acquire either at different prices or at a particular
price. This process, known as “book-building,” is expected to continue up to, and to cease on or
about, the last day for lodging applications under the Hong Kong Public Offering.
The Sponsor-Overall Coordinator (for itself and on behalf of the Underwriters) may, where it
deems appropriate, based on the level of interest expressed by prospective investors during the
book-building process in respect of the International Offering, and with the consent of the
Company, reduce the number of Offer Shares offered as 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 case, the Company will, as soon as practicable following the decision to make such
reduction, and in any event not later than the morning of the last day for lodging applications
under the Hong Kong Public Offering, post a notice on the website of the Stock Exchange
(www.hkexnews.hk
) and the website of our Company ( www.hanscnc.com ) (the contents of the
website do not form a part of this Prospectus). 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. The Global
Offering must first be canceled and subsequently relaunched on FINI pursuant to the supplemental
prospectus.
Before submitting applications for the Hong Kong Offer Shares, applicants should have
regard to the possibility that any announcement of a reduction in the number of Offer Shares may
not be made until the day which is the last day for lodging applications under the Hong Kong
Public Offering. In the absence of any such notice so announced, the number of Offer Shares will
not be reduced.
The final pricing of the Offer Shares, the level of indications of interest in the International
Offering, the level of applications in the Hong Kong Public Offering, the basis of allocations of
the Hong Kong Offer Shares and the results of allocations in the Hong Kong Public Offering are
expected to be made available through a variety of channels in the manner described in “How to
Apply for Hong Kong Offer Shares — B. Publication of Results.”
UNDERWRITING
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters under
the terms and conditions of the Hong Kong Underwriting Agreement and is subject to, among
other things, the Sponsor-Overall Coordinator (for itself and on behalf of the Underwriters) and the
Company agreeing on the Offer Price.
The Company expects to enter into the International Underwriting Agreement relating to the
International Offering on or around the Price Determination Date.
STRUCTURE OF THE GLOBAL OFFERING
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These underwriting arrangements, including the Underwriting Agreements, are summarized in
“Underwriting.”
CONDITIONS OF THE GLOBAL OFFERING
Acceptance of all applications for Offer Shares will be conditional on:
 the Stock Exchange granting approval for the listing of, and permission to deal in, the H
Shares to be issued as mentioned in this Prospectus, on the Main Board of the Stock
Exchange and such approval not subsequently having been withdrawn or revoked prior
to the Listing Date;
 the pricing of the Offer Shares having been agreed between the Sponsor-Overall
Coordinator (for itself and on behalf of the Underwriters) and the Company;
 the execution and delivery of the International Underwriting Agreement on or around
the Price Determination Date; and
 the obligations of the Hong Kong Underwriters under the Hong Kong Underwriting
Agreement and the obligations of the International Underwriters under the International
Underwriting Agreement becoming and remaining unconditional and not having been
terminated in accordance with the terms of the respective agreements,
in each case on or before the dates and times specified in the respective Underwriting Agreements
(unless and to the extent such conditions are validly waived on or before such dates and times)
and, in any event, not later than the date which is 30 days after the date of this Prospectus.
If, for any reason, the Offer Price is not agreed between the Sponsor-Overall Coordinator (for
itself and on behalf of the Underwriters) and the Company on or before 12:00 noon on Wednesday,
February 4, 2026, the Global Offering will not proceed and will lapse.
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.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 439 ---
If the above conditions are not fulfilled or waived prior to the dates and times specified, the
Global Offering will lapse and the Stock Exchange will be notified immediately. Notice of the
lapse of the Hong Kong Public Offering will be published by the Company on the websites of the
Company and the Stock Exchange at www.hanscnc.com
and www.hkexnews.hk , respectively, on
the next day following such lapse. In such a situation, all application monies will be returned,
without interest, on the terms set out in “How to Apply for Hong Kong Offer Shares — D.
Despatch/Collection of H Share Certificates and Refund of Application Monies.” In the meantime,
all application monies will be held in separate bank account(s) with the receiving banks or other
bank(s) in Hong Kong licensed under the Banking Ordinance (Chapter 155 of the Laws of Hong
Kong).
H Share certificates for the Offer Shares will only become valid evidence of title at 8:00 a.m.
on Friday, February 6, 2026, provided that the Global Offering has become unconditional in all
respects at or before that time.
DEALINGS IN THE H SHARES
Assuming that the Hong Kong Public Offering becomes unconditional at or before 8:00 a.m.
in Hong Kong on Friday, February 6, 2026, it is expected that dealings in the H Shares on the
Stock Exchange will commence at 9:00 a.m. on Friday, February 6, 2026.
The H Shares will be traded in board lots of 100 H Shares each and the stock code of the H
Shares will be 3200.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 440 ---
IMPORTANT NOTICE TO INVESTORS OF HONG KONG OFFER SHARES
FULLY ELECTRONIC APPLICATION PROCESS
The Company has 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 the Company’s website at www.hanscnc.com .
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;
 have a Hong Kong address (for the HK eIPO White Form service only) ; and
 are outside the United States (within the meaning of Regulation S) or are a person
described in paragraph (h)(3) of Rule 902 of Regulation S.
Unless permitted by the Listing Rules and/or the Guide for New Listing Applicants or a
waiver and/or consent has been granted by the Stock Exchange to the Company, 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 of the Company;
 are a Director or chief executive of the Company and/or a director, supervisor or chief
executive of any of its subsidiaries;
 are a close associate (as defined in the Listing Rules) of any of the above persons;
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 441 ---
 are a connected person (as defined in the Listing Rules) of the Company or will become
a connected person of the Company immediately upon the completion of the Global
Offering; or
 have been allocated or have applied for or indicated an interest in any International
Offer Shares or otherwise participate in the International Offering.
2. Application Channels
The Hong Kong Public Offering period will begin at 9:00 a.m. on Thursday, January 29,
2026 and end at 12:00 noon on Tuesday, February 3, 2026 (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
HK eIPO White Form
servic e...... ......
www.hkeipo.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 a.m. on
Thursday, January 29,
2026 until 11:30 a.m. on
Tuesday, February 3,
2026 and the latest time
for completing full
payment of application
monies in respect of such
applications will be 12:00
noon on Tuesday,
February 3, 2026, the last
day for application, or
such later time as
described in “— E.
Severe Weather
Arrangements” below.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 442 ---
Application Channel Platform Target Investors Application 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 HK eIPO White Form 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.
For those applying through the HK eIPO White Form service, once you complete payment
in respect of any application instructions given by you or for your benefit through the HK eIPO
White Form 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 HK eIPO White
Form 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 HK eIPO White Form service, you are deemed to have authorized
the HK eIPO White Form Service Provider to apply on the terms and conditions in this
Prospectus, as supplemented and amended by the terms and conditions of the HK eIPO White
Form service.
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--- page 443 ---
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.
3. Information Required to Apply
You must provide the following information with your application:
For Individual/Joint Applicants For Corporate Applicants
 Full name(s) 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) 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
HOW TO APPLY FOR HONG KONG OFFER SHARES
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Notes:
1. If you are applying through the HK eIPO White Form 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. The number of joint applicants may not exceed
four. If you are a firm, the applicant must be in the individual members’ names.
2. The applicant’s full name as shown on their identity document must be used and the surname, given name, middle
and other names (if any) must be input in the same order as shown on the identity document. 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 (including both
Hong Kong Residents and Hong Kong Permanent Residents), the HKID number must be used when making an
application to subscribe for Hong Kong Offer Shares. Similarly for corporate applicants, an LEI number must be
used if an entity has an 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 in accordance with market practice.
5. If you are applying as a nominee, you must provide: (i) the full name (as shown on the identity document), the
identity document’s issuing country or jurisdiction, the identity document type; and (ii) the identity document
number, for each of the beneficial owners or, in the case(s) of joint beneficial owners, for each joint beneficial
owner. If you do not include this information, the application will be treated as being made for your benefit.
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, the Company and the Sponsor-Overall Coordinator, as the Company’s agent, have
discretion to consider whether to accept it on any conditions they think fit, including evidence of
the attorney’s authority.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 445 ---
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 ......... : 100 H Shares
Permitted number of
Hong Kong Offer
Shares for application
and amount payable on
application/successful
allotment ...........
: Hong Kong Offer Shares are available for application
in specified board lot sizes only. Please refer to the
amount payable associated with each specified board
lot size in the table below.
The maximum Offer Price is HK$95.80 per H Share.
If you are applying through the HKSCC EIPO
channel, your broker or custodian may require you
to pre-fund your application, in such amount as
determined by the broker or custodian , based on
the applicable laws and regulations in Hong Kong.
You are responsible for complying with any such
pre-funding requirement imposed by your broker or
custodian with respect to the Hong Kong Offer
Shares you applied for.
By instructing your broker or custodian to apply for
the Hong Kong Offer Shares on your behalf through
the HKSCC EIPO Channel, you (and, if you are
joint applicants, each of you jointly and severally)
are deemed to have instructed and authorized
HKSCC to cause HKSCC Nominees (acting as
nominee for the relevant HKSCC Participants) to
arrange payment of the final Offer Price, the
brokerage, the SFC transaction levy, the Stock
Exchange trading fee and the AFRC transaction levy
by debiting the relevant nominee bank account at
the designated bank for your broker or custodian.
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If you are applying through the HK eIPO White
Form service, you may refer to the table below for
the amount payable for the number of H Shares you
have selected. You must pay the respective
maximum amount payable on application in full
upon application for Hong Kong Offer Shares.
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
HK$ HK$ HK$ HK$
100 9,676.61 2,500 241,915.36 30,000 2,902,984.29 600,000 58,059,685.80
200 19,353.23 3,000 290,298.43 40,000 3,870,645.72 700,000 67,736,300.10
300 29,029.84 3,500 338,681.49 50,000 4,838,307.16 800,000 77,412,914.40
400 38,706.46 4,000 387,064.57 60,000 5,805,968.58 900,000 87,089,528.70
500 48,383.07 4,500 435,447.65 70,000 6,773,630.01 1,000,000 96,766,143.00
600 58,059.69 5,000 483,830.71 80,000 7,741,291.45 1,500,000 145,149,214.50
700 67,736.30 6,000 580,596.86 90,000 8,708,952.86 2,000,000 193,532,286.00
800 77,412.91 7,000 677,363.01 100,000 9,676,614.30 2,522,600
(1) 244,102,272.34
900 87,089.53 8,000 774,129.14 200,000 19,353,228.60
1,000 96,766.14 9,000 870,895.28 300,000 29,029,842.90
1,500 145,149.22 10,000 967,661.44 400,000 38,706,457.20
2,000 193,532.29 20,000 1,935,322.85 500,000 48,383,071.50
(1) Maximum number of Hong Kong Offer Shares you may apply for and this is 50% of the Hong Kong Offer Shares
initially offered.
(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) or to the HK eIPO White Form Service Provider (for applications made through the
application channel of the HK eIPO White Form service) while the SFC transaction levy, the Stock Exchange
trading fee and the AFRC transaction levy will be paid to the SFC, the Stock Exchange and the AFRC, respectively.
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. Applications for Hong Kong Offer
Shares — 3. Information Required to Apply” in this section. If you are suspected of submitting or
cause to submit more than one application, all of your applications will be rejected.
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Multiple applications made either through (i) the HK eIPO White Form service, (ii)
HKSCC EIPO channel, or (iii) both channels concurrently are prohibited and will be rejected. If
you have made an application through the HK eIPO White Form 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 in the International Offering.
The H Share Registrar would record all applications into its system and identify suspected
multiple applications with identical names and identification document numbers according to the
Best Practice Note on Treatment of Multiple/Suspected Multiple Applications (“ Best Practice
Note”) issued by the Federation of Share Registrars Limited.
Since applications are subject to personal information collection statements, identification
document numbers displayed are redacted.
6. Terms and Conditions of An Application
By applying for Hong Kong Offer Shares through the HK eIPO White Form 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 authorize the Company
and/or the Sponsor-Overall Coordinator, as the Company’s agent, 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 HK eIPO White
Form 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;
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(iv) confirm that you are aware of the restrictions on offers and sales of H 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;
(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 Company, the Sole Sponsor, the Sponsor-Overall Coordinator, the Overall
Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead
Managers, the Capital Market Intermediaries, the Underwriters, any of their respective
directors, officers, employees, partners, agents, advisers and any other parties involved
in the Global Offering (the “ Relevant Persons ”), the H Share Registrar and HKSCC
will not be liable for any information and representations not in this Prospectus and any
supplement to it;
(vii) agree to disclose the details of your application and your personal data and any other
personal data which may be required about you and the person(s) for whose benefit you
have made the application to the Company, 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 paragraphs headed “— G. Personal Data — 3. Purposes” and
“— 4. Transfer of personal data” in this section;
(viii) agree (without prejudice to any other rights which you may have once your application
(or as the case may be, HKSCC Nominees’ application) has been accepted) that you will
not rescind it because of an innocent misrepresentation;
(ix) agree that subject to Section 44A(6) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance, any application made by you or HKSCC Nominees on your
behalf cannot be revoked once it is accepted, which will be evidenced by the
notification of the result of the ballot by the H Share Registrar by way of publication of
the results at the time and in the manner as specified in the paragraph headed “— B.
Publication of Results” in this section;
(x) confirm that you are aware of the situations specified in the paragraph headed “— C.
Circumstances in which You will not Be Allocated Hong Kong Offer Shares” in this
section;
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(xi) agree that your application or HKSCC Nominees’ application, any acceptance of it and
the resulting contract will be governed by and construed in accordance with the laws of
Hong Kong;
(xii) agree to comply with the Companies Ordinance, the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, the Articles of Association and laws of any place
outside Hong Kong that apply to your application and that neither the Company 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, supervisors, chief
executive, 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, supervisors, chief executive, 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 H
Shares registered in your name or otherwise held by you;
(xiv) warrant that the information you have provided is true and accurate;
(xv) confirm that you understand that the Company and the Sponsor-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 HK eIPO White
Form service or by any one as your agent or by any other person; and
HOW TO APPLY FOR HONG KONG OFFER SHARES
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(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 or to the HK eIPO White
Form Service Provider and (2) you have due authority to give electronic application
instructions on behalf of that other person as its agent.
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 the HK eIPO White Form service or HKSCC EIPO channel:
Website .......... From the “Allotment Results” page on the
designated results of allocations website
at www.tricor.com.hk/ipo/result
or
www.hkeipo.hk/IPOResult with a “search
by ID” function.
24 hours, from 11:00 p.m. on Thursday,
February 5, 2026 to 12:00 midnight on
Wednesday, February 11, 2026 (Hong Kong
time)
The full list of (i) wholly or partially
successful applicants using the HK eIPO
White Form service and HKSCC EIPO
channel, and (ii) the number of Hong Kong
Offer Shares conditionally allotted to them,
among other things, will be displayed at
www.tricor.com.hk/ipo/result
or
www.hkeipo.hk/IPOResult .
The Stock Exchange’s website at
www.hkexnews.hk and the Company’s
website at www.hanscnc.com which will
provide links to the above mentioned
websites of the H Share Registrar.
No later than 11:00 p.m. on Thursday,
February 5, 2026 (Hong Kong time)
Telephone ........ +852 3691 8488 — the allocation results
telephone enquiry line provided by the H
Share Registrar
between 9:00 a.m. and 6:00 p.m. from Friday,
February 6, 2026 to Wednesday, February
11, 2026 (Hong Kong time) on a business
day
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For those applying through HKSCC EIPO channel, you may also check with your broker or
custodian from 6:00 p.m. on Wednesday, February 4, 2026 (Hong Kong time).
HKSCC Participants can log into FINI and review the allotment result from 6:00 p.m. on
Wednesday, February 4, 2026 (Hong Kong time) on a 24-hour basis and should report any
discrepancies on allotments to HKSCC as soon as practicable.
Allocation Announcement
The Company expects to announce the results of the final Offer Price, the level of indications
of interest in the International Offering, the level of applications in the Hong Kong Public Offering
and the basis of allocations of Hong Kong Offer Shares on the Stock Exchange’s website at
www.hkexnews.hk
and the Company’s website at www.hanscnc.com by no later than 11:00 p.m.
on Thursday, February 5, 2026 (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 the Company or its agents exercise their discretion to reject your application:
The Company, the Sponsor-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 H Shares either:
 within three weeks from the closing date of the application lists; or
HOW TO APPLY FOR HONG KONG OFFER SHARES
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 within a longer period of up to six weeks if the Stock Exchange notifies the Company 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;
 the Underwriting Agreements do not become unconditional or are terminated;
 the Company or the Sponsor-Overall Coordinator believes that by accepting your
application, it or the Company would violate applicable securities or other laws, rules or
regulations.
5. If there is money settlement failure for allotted Offer 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 Offer 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 the Company, 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.
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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 H Share certificates will be deposited into CCASS as described below).
No temporary document of title will be issued in respect of the Offer Shares. No receipt will
be issued for sums paid on application.
H Share certificates will only become valid evidence of title at 8:00 a.m. on Friday, February
6, 2026 (Hong Kong time), provided that the Global Offering has become unconditional, and the
right of termination described in the section headed “Underwriting” in this Prospectus has not been
exercised. Investors who trade H Shares prior to the receipt of H Share certificates or the H Share
certificates becoming valid evidence of title do so entirely at their own risk.
The right is reserved to retain any H Share certificate(s) and (if applicable) any surplus
application monies pending clearance of application monies.
The following sets out the relevant procedures and time:
HK eIPO White Form service HKSCC EIPO channel
Despatch/collection of H Share certificate 1
For application of 1,000,000
Hong Kong Offer Shares
or more .................
Collection in person from the H Share
Registrar, Tricor Investor Services
Limited, at 17/F, Far East Finance
Centre, 16 Harcourt Road, Hong
Kong
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
Time: from 9:00 a.m. to 1:00 p.m. on
Friday, February 6, 2026 (Hong
Kong time), or any other place or
date notified by the Company
No action by you is required
1 Except in the event any Severe Weather Signals (as defined below) in force in Hong Kong in the morning on
Thursday, February 5, 2026 rendering it impossible for the relevant H Share certificates to be dispatched to HKSCC
in a timely manner, the Company shall procure the H Share Registrar to arrange for delivery of the supporting
documents and H Share certificates in accordance with the contingency arrangements as agreed between them. You
may refer to “— E. Severe Weather Arrangements” in this section.
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--- page 454 ---
HK eIPO White Form service HKSCC EIPO channel
If you are an individual, you must not
authorize any other person to collect
for you. If you are a corporate
applicant, your authorized
representative must bear a letter of
authorization from your corporation
stamped with your corporation’s
chop.
Both individuals and authorized
representatives must produce, at the
time of collection, evidence of
identity acceptable to the H Share
Registrar.
Note: If you do not collect your H
Share certificate(s) personally
within the time above, it/they will
be sent to the address specified in
your application instructions by
ordinary post at your own risk
For application of less than
1,000,000 Hong Kong Offer
Shares ..................
Your H Share certificate(s) will be
sent to the address specified in your
application instructions by ordinary
post at your own risk
Date: Thursday, February 5, 2026
Refund mechanism for surplus application monies paid by you
Date ..................... Friday, February 6, 2026 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 .........
HK eIPO White Form e-Auto 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
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HK eIPO White Form service HKSCC EIPO channel
Application monies paid through
multiple bank accounts .......
Refund check(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 Tuesday, February 3, 2026 if, there is:
 a tropical cyclone warning signal number 8 or above;
 a black rainstorm warning; and/or
 an Extreme Condition,
(collectively, the “ Severe Weather Signal(s) ”), in force in Hong Kong at any time between 9:00
a.m. and 12:00 noon on Tuesday, February 3, 2026.
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 the Company’s
website at www.hanscnc.com of the revised timetable.
If a Severe Weather Signal is hoisted on Thursday, February 5, 2026, the H Share Registrar
will make appropriate arrangements for the delivery of the H Share certificates to the CCASS
Depository’s service counter so that they would be available for trading on Friday, February 6,
2026, and for application of less than 1,000,000 Hong Kong Offer Shares, the despatch of physical
H Share certificate(s) will be made by ordinary post when the post office reopens after the Severe
Weather Signal is lowered or cancelled (e.g. in the afternoon of Thursday, February 5, 2026 or on
Friday, February 6, 2026).
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If a Severe Weather Signal is hoisted on Friday, February 6, 2026, for application of
1,000,000 Hong Kong Offer Shares or more, physical H Share certificate(s) will be available for
collection in person at the H Share Registrar’s office after the Severe Weather Signal is lowered or
cancelled (e.g. in the afternoon of Friday, February 6, 2026 or on Monday, February 9, 2026).
Prospective investors should be aware that if they choose to receive physical H Share
certificates issued in their own name, there may be a delay in receiving the H Share
certificates.
F. ADMISSION OF THE H SHARES INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the H Shares on the
Stock Exchange and the 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 Stock
Exchange 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 the HKSCC
Operational Procedures in effect from time to time.
All necessary arrangements have been made enabling the H 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.
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 agreed to all of the terms of the Personal Information Collection Statement below.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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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 H 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 check and HK eIPO White Form e-Auto
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;
 compliance with applicable laws and regulations in Hong Kong and elsewhere;
 registering new issues or transfers into or out of the names of the holders of the H
Shares including, where applicable, HKSCC Nominees;
 maintaining or updating the register of members of the Company;
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 verifying identities of applicants for and holders of the H Shares and identifying any
duplicate applications for the H Shares;
 facilitating Hong Kong Offer Shares balloting;
 establishing benefit entitlements of holders of the H Shares, such as dividends, rights
issues, bonus issues, etc.;
 distributing communications from the Company and its subsidiaries;
 compiling statistical information and profiles of the holder of the H Shares;
 disclosing relevant information to facilitate claims on entitlements; and
 any other incidental or associated purposes relating to the above and/or to enable the
Company and the H Share Registrar to discharge their obligations to applicants and
holders of the H Shares and/or regulators and/or any other purposes to which applicants
and holders of the H Shares may from time to time agree.
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
principal share registrar;
 HKSCC or HKSCC Nominees, who will use the personal data and may transfer the
personal data to the H Share Registrar, in each case for the purposes of providing its
services or facilities or performing its functions in accordance with its rules or
procedures and operating FINI and CCASS (including where applicants for the Hong
Kong Offer Shares request a deposit into CCASS);
 any agents, contractors or third-party service providers who offer administrative,
telecommunications, computer, payment or other services to the Company or the H
Share Registrar in connection with their respective business operations;
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 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 fulfill the purposes for which the
personal data was 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 holds 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
– 449 –


--- page 460 ---
The following is the text of a report, prepared for the purpose of incorporation in this
document, received from the independent reporting accountants, Ernst & Young, Certified Public
Accountants, Hong Kong.
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hong Kong
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ACCOUNTANTS’ REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE
DIRECTORS OF SHENZHEN HAN’S CNC TECHNOLOGY CO., LTD. AND CHINA
INTERNATIONAL CAPITAL CORPORATION HONG KONG SECURITIES LIMITED
Introduction
We report on the historical financial information of Shenzhen Han’s CNC Technology Co.,
Ltd. (the “ Company ”) and its subsidiaries (together, the “ Group ”) set out on pages I-4 to I-169,
which comprises the consolidated statements of profit or loss, statements of comprehensive
income, statements of changes in equity and statements of cash flows of the Group for each of the
years ended December 31, 2022, 2023 and 2024 and the ten months ended October 31, 2025 (the
“Relevant Periods ”), and the consolidated statements of financial position of the Group and the
statements of financial position of the Company as at December 31, 2022, 2023 and 2024 and
October 31, 2025 and material accounting policy information and other explanatory information
(together, the “ Historical Financial Information ”). The Historical Financial Information set out
on pages I-4 to I-169 forms an integral part of this report, which has been prepared for inclusion
in the prospectus of the Company dated 29 January 2026 (the “ Prospectus ”) in connection with
the initial listing of the shares of the Company on the Main Board of The Stock Exchange of Hong
Kong Limited (the “ Stock Exchange ”).
Directors’ responsibility for the Historical Financial Information
The directors of the Company are responsible for the preparation of the Historical Financial
Information that gives a true and fair view in accordance with the basis of preparation set out in
note 2.1 to the Historical Financial Information, and for such internal control as the directors
determine is necessary to enable the preparation of the Historical Financial Information that is free
from material misstatement, whether due to fraud or error.
APPENDIX I ACCOUNTANTS’ REPORT
– I-1 –


--- page 461 ---
Reporting accountants’ responsibility
Our responsibility is to express an opinion on the Historical Financial Information and to
report our opinion to you. We conducted our work in accordance with Hong Kong Standard on
Investment Circular Reporting Engagements 200 Accountants’ Reports on Historical Financial
Information in Investment Circulars issued by the Hong Kong Institute of Certified Public
Accountants (“ HKICPA”). This standard requires that we comply with ethical standards and plan
and perform our work to obtain reasonable assurance about whether the Historical Financial
Information is free from material misstatement.
Our work involved performing procedures to obtain evidence about the amounts and
disclosures in the Historical Financial Information. The procedures selected depend on the
reporting accountants’ 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 set out in note 2.1 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 purposes of the
accountants’ report, a true and fair view of the financial position of the Group and the Company as
at December 31, 2022, 2023 and 2024 and October 31, 2025, and of the financial performance and
cash flows of the Group for each of the Relevant Periods in accordance with the basis of
preparation set out in note 2.1 to the Historical Financial Information.
Review of interim comparative financial information
We have reviewed the interim comparative financial information of the Group which
comprises the consolidated statement of profit or loss, the consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated
statement of cash flows for the ten months ended October 31, 2024, and other explanatory
APPENDIX I ACCOUNTANTS’ REPORT
– I-2 –


--- page 462 ---
information (the “ Interim Comparative Financial Information ”). The directors of the Company
are responsible for the preparation and presentation of the Interim Comparative Financial
Information in accordance with the basis of preparation set out in note 2.1 to the Historical
Financial Information. Our responsibility is to express a conclusion on the Interim Comparative
Financial Information based on our review. We conducted our review in accordance with Hong
Kong Standard on Review Engagements 2410 Review of Interim Financial Information Performed
by the Independent Auditor of the Entity issued by the HKICPA. A review consists of making
enquiries, primarily of persons responsible for financial and accounting matters, and applying
analytical and other review procedures. A review is substantially less in scope than an audit
conducted in accordance with Hong Kong Standards on Auditing and consequently does not enable
us to obtain assurance that we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit opinion. Based on our review,
nothing has come to our attention that causes us to believe that the Interim Comparative Financial
Information, for the purposes of the accountants’ report, is not prepared, in all material respects, in
accordance with the basis of preparation set out in note 2.1 to the Historical Financial Information.
Report on matters under the Rules Governing the Listing of Securities on the Stock Exchange
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 13 to the Historical Financial Information which contains information about
the dividends paid by the Company in respect of the Relevant Periods.
Certified Public Accountants
Hong Kong
29 January 2026
APPENDIX I ACCOUNTANTS’ REPORT
– I-3 –


--- page 463 ---
I HISTORICAL FINANCIAL INFORMATION
Preparation of Historical Financial Information
Set out below is the Historical Financial Information which forms an integral part of this
accountants’ report.
The financial statements of the Group for the Relevant Periods, on which the Historical
Financial Information is based, were audited by Ernst & Young in accordance with Hong Kong
Standards on Auditing issued by the HKICPA (the “ Underlying Financial Statements ”).
The Historical Financial Information is presented in Renminbi (“ RMB”) and all values are
rounded to the nearest thousand (RMB’000) except when otherwise indicated.
APPENDIX I ACCOUNTANTS’ REPORT
– I-4 –


--- page 464 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
Notes Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
REVENUE ................. 5 2,786,150 1,634,311 3,343,091 2,623,882 4,314,146
Cost of sales ................ (1,838,332) (1,157,425) (2,435,421) (1,935,634) (2,971,290)
Gross profit ................ 947,818 476,886 907,670 688,248 1,342,856
Other income and gains, net ..... 6 184,681 127,799 192,013 89,257 131,358
Selling and marketing expenses ... (160,527) (132,209) (196,103) (160,668) (235,830)
Administrative expenses ........ (153,653) (112,515) (203,743) (154,874) (218,396)
Research and development
expenses ................. (229,671) (193,564) (266,829) (200,660) (299,957)
Impairment losses on financial
assets and contract assets under
expected credit loss model
(“ECL”), net .............. (22,780) (17,397) (23,355) (29,575) (26,209)
Other expenses ............... 9 (3,977) (10,621) (83,175) (5,457) (96,009)
Finance costs ................ 8 (16,976) (6,638) (10,061) (9,088) (13,470)
Impairment of an investment in an
associate ................. (55,768) ————
Share of profits and losses of
associates ................. (5,825) 5,685 13,166 4,901 5,573
PROFIT BEFORE TAX ........ 7 483,322 137,426 329,583 222,084 589,916
Income tax expense ........... 12 (51,310) (1,758) (30,001) (10,109) (70,997)
PROFIT FOR THE
YEAR/PERIOD ............ 432,012 135,668 299,582 211,975 518,919
Attributable to:
Owners of the parent .......... 434,687 135,546 301,180 212,262 523,089
Non-controlling interests ........ (2,675) 122 (1,598) (287) (4,170)
432,012 135,668 299,582 211,975 518,919
EARNINGS PER SHARE
ATTRIBUTABLE TO
ORDINARY EQUITY
HOLDERS OF THE PARENT
Basic (RMB per share) ......... 14 1.05 0.32 0.72 0.51 1.24
Diluted (RMB per share) ........ 14 1.05 0.32 0.71 0.50 1.22
APPENDIX I ACCOUNTANTS’ REPORT
– I-5 –


--- page 465 ---
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
PROFIT FOR THE
YEAR/PERIOD ............. 432,012 135,668 299,582 211,975 518,919
OTHER COMPREHENSIVE
INCOME
Other comprehensive income/(loss)
that may be reclassified to profit
or loss in subsequent periods:
Share of other comprehensive
income/(loss) of associates ...... 28 (14) 60 — (40)
Exchange differences on translation
of foreign operations .......... 1,391 235 343 (78) (148)
OTHER COMPREHENSIVE
INCOME/(LOSS) FOR THE
YEAR/PERIOD, NET OF TAX . 1,419 221 403 (78) (188)
TOTAL COMPREHENSIVE
INCOME FOR THE
YEAR/PERIOD ............. 433,431 135,889 299,985 211,897 518,731
Attributable to:
Owners of the parent ............ 436,106 135,767 301,583 212,184 522,901
Non-controlling interests ......... (2,675) 122 (1,598) (287) (4,170)
433,431 135,889 299,985 211,897 518,731
APPENDIX I ACCOUNTANTS’ REPORT
– I-6 –


--- page 466 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
Notes As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and
equipment ............ 15 173,355 415,379 677,804 765,468
Investment properties ..... 16 1,957 1,880 1,803 1,738
Right-of-use assets ....... 17(a) 590,720 534,548 493,578 474,990
Goodwill .............. 18 12,924 153,963 74,323 12,924
Other intangible assets .... 19 8,116 6,840 5,185 4,521
Investments in associates .. 20 39,892 42,308 51,310 54,293
Trade and bills receivables
at amortised cost ....... 22 118,624 60,913 170,002 513,566
Prepayments, other
receivables and other
assets ............... 23 73,501 51,508 69,030 39,373
Deferred tax assets ....... 34 58,112 67,085 49,967 89,338
Time deposits ........... 26 — — 400,000 417,114
Total non-current assets ... 1,077,201 1,334,424 1,993,002 2,373,325
CURRENT ASSETS
Inventories ............. 21 903,919 972,117 898,185 1,716,879
Trade and bills receivables . 22 2,149,075 1,694,789 2,676,146 4,173,623
Contract assets .......... 24 19,179 19,610 24,880 45,888
Prepayments, other
receivables and other
assets ............... 23 15,899 39,406 54,820 112,085
Restricted cash .......... 26 — 1,816 333 542
Cash and cash equivalents . 26 2,986,535 1,916,965 1,539,131 1,146,344
Total current assets ...... 6,074,607 4,644,703 5,193,495 7,195,361
APPENDIX I ACCOUNTANTS’ REPORT
– I-7 –


--- page 467 ---
Notes As at December 31,
At at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
CURRENT LIABILITIES
Trade and bills payables ... 27 671,476 592,018 1,275,637 2,244,899
Contract liabilities ....... 28 25,955 65,754 54,895 61,423
Other payables and
accruals ............. 31 503,327 380,460 411,581 590,976
Liabilities from contingent
consideration ......... 33 — 68,683 8,523 —
Interest-bearing
borrowings ........... 32 17,174 75,744 2,426 645,895
Lease liabilities ......... 17(b) 45,063 35,497 34,716 22,120
Income tax payable ...... 37,357 5,724 9,250 80,630
Provision .............. 30 16,671 11,727 15,570 19,154
Total current liabilities .... 1,317,023 1,235,607 1,812,598 3,665,097
NET CURRENT ASSETS . 4,757,584 3,409,096 3,380,897 3,530,264
TOTAL ASSETS LESS
CURRENT
LIABILITIES ........ 5,834,785 4,743,520 5,373,899 5,903,589
NON-CURRENT
LIABILITIES
Interest-bearing
borrowings ........... 32 — — 211,050 179,960
Deferred income ......... 29 3,453 2,282 1,769 1,173
Provision .............. 30 13,419 2,619 6,841 20,754
Lease liabilities ......... 17(b) 83,407 45,011 12,798 12,141
Deferred tax liabilities .... 34 3,794 5,063 5,064 5,269
Total non-current
liabilities ............ 104,073 54,975 237,522 219,297
Net assets .............. 5,730,712 4,688,545 5,136,377 5,684,292
EQUITY
Equity attributable to
owners of the parent
Share capital ........... 35 420,000 420,000 420,000 425,509
Reserves ............... 37 5,307,867 4,257,493 4,706,923 5,242,966
5,727,867 4,677,493 5,126,923 5,668,475
Non-controlling interests .. 2,845 11,052 9,454 15,817
Total equity ............ 5,730,712 4,688,545 5,136,377 5,684,292
APPENDIX I ACCOUNTANTS’ REPORT
– I-8 –


--- page 468 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Year ended December 31, 2022
Attributable to owners of the parent
Share
capital
Share
premium
Share-based
payment
reserve
Other
reserve
Translation
reserve
Statutory
reserve
Retained
profits Total
Non-
controlling
interests Total equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 35) (note 37(a)) (note 37(b)) (note 37(c)) (note 37(d)) (note 37(e))
At January 1, 2022 ...... 378,000 1,012,586 24,991 3,052 (894) 100,111 870,390 2,388,236 5,526 2,393,762
Profit for the year ...... —————— 434,687 434,687 (2,675) 432,012
Other comprehensive income
for the year:
Share of other comprehensive
income of associates .... ————2 8——2 8—2 8
Exchange differences on
translation of foreign
operations ......... ———— 1,391 — — 1,391 — 1,391
Total comprehensive income
for the year ........ ———— 1,419 — 434,687 436,106 (2,675) 433,431
Dividends declared ...... —————— (168,000) (168,000) — (168,000)
Issue of shares ........ 42,000 3,039,779 ————— 3,081,779 — 3,081,779
Transfer of share option
reserve upon the forfeiture
or expiry of share options . — 14,737 (14,737) ———————
Share-based payment
compensation ........ — — (10,254) ———— (10,254) (6) (10,260)
Transfer from retained profits . ————— 45,745 (45,745) — — —
At December 31, 2022 .... 420,000 4,067,102* —* 3,052* 525* 145,856* 1,091,332* 5,727,867 2,845 5,730,712
APPENDIX I ACCOUNTANTS’ REPORT
– I-9 –


--- page 469 ---
Year ended December 31, 2023
Attributable to owners of the parent
Share
capital
Share
premium
Share-based
payment
reserve
Other
reserve
Translation
reserve
Statutory
reserve
Retained
profits Total
Non-
controlling
interests Total equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 35) (note 37(a)) (note 37(b)) (note 37(c)) (note 37(d)) (note 37(e))
At January 1, 2023 ...... 420,000 4,067,102 — 3,052 525 145,856 1,091,332 5,727,867 2,845 5,730,712
Profit for the year ...... —————— 135,546 135,546 122 135,668
Other comprehensive income
for the year: ........
Share of other comprehensive
loss of associates ...... ———— (14) — — (14) — (14)
Exchange differences on
translation of foreign
operations ......... ———— 2 3 5—— 2 3 5— 2 3 5
Total comprehensive income
for the year ........ ———— 2 2 1— 135,546 135,767 122 135,889
Acquisition of non-controlling
interests .......... — — — (1,877) — — — (1,877) (1,676) (3,553)
Non-controlling interests
arising from business
combination (note 39) .... ———————— 9,761 9,761
Dividends declared ...... —————— (1,197,000) (1,197,000) — (1,197,000)
Share-based payment
compensation ........ — — 12,736 ———— 12,736 — 12,736
Transfer from retained profits . ————— 28,444 (28,444) — — —
At December 31, 2023 .... 420,000 4,067,102* 12,736* 1,175* 746* 174,300* 1,434* 4,677,493 11,052 4,688,545
APPENDIX I ACCOUNTANTS’ REPORT
– I-10 –


--- page 470 ---
Year ended December 31, 2024
Attributable to owners of the parent
Share
capital
Share
premium
Share-based
payment
reserve
Other
reserve
Translation
reserve
Statutory
reserve
Retained
profits Total
Non-
controlling
interests Total equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 35) (note 37(a)) (note 37(b)) (note 37(c)) (note 37(d)) (note 37(e))
At January 1, 2024 ...... 420,000 4,067,102 12,736 1,175 746 174,300 1,434 4,677,493 11,052 4,688,545
Profit for the year ...... —————— 301,180 301,180 (1,598) 299,582
Other comprehensive income
for the year:
Share of other comprehensive
income of associates .... ————6 0——6 0—6 0
Exchange differences on
translation of foreign
operations ......... ———— 3 4 3—— 3 4 3— 3 4 3
Total comprehensive income
for the year ........ ———— 4 0 3— 301,180 301,583 (1,598) 299,985
Changes due to passive
dilution of investment in an
associate .......... — — — (4,224) — — — (4,224) — (4,224)
Share-based payment
compensation ........ — — 152,071 ———— 152,071 — 152,071
Transfer from retained profits . ————— 29,452 (29,452) — — —
At December 31, 2024 .... 420,000 4,067,102* 164,807* (3,049)* 1,149* 203,752* 273,162* 5,126,923 9,454 5,136,377
APPENDIX I ACCOUNTANTS’ REPORT
– I-11 –


--- page 471 ---
Ten months ended October 31, 2024
Attributable to owners of the parent
Share
capital
Share
premium
Share-based
payment
reserve
Other
reserve
Translation
reserve
Statutory
reserve
Retained
profits Total
Non-
controlling
interests Total equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 35) (note 37(a)) (note 37(b)) (note 37(c)) (note 37(d)) (note 37(e))
At January 1, 2024 ...... 420,000 4,067,102 12,736 1,175 746 174,300 1,434 4,677,493 11,052 4,688,545
Profit for the period
(unaudited) ......... —————— 212,262 212,262 (287) 211,975
Other comprehensive income
for the period: (unaudited) ..
Exchange differences on
translation of foreign
operations (unaudited) ... ———— (78) — — (78) — (78)
Total comprehensive income
for the period (unaudited) . ———— (78) — 212,262 212,184 (287) 211,897
Share-based payment
compensation (unaudited) .. — — 127,357 ———— 127,357 — 127,357
At October 31, 2024
(unaudited) ........ 420,000 4,067,102 140,093 1,175 668 174,300 213,696 5,017,034 10,765 5,027,799
APPENDIX I ACCOUNTANTS’ REPORT
– I-12 –


--- page 472 ---
Ten months ended October 31, 2025
Attributable to owners of the parent
Share
capital
Share
premium
Share-based
payment
reserve
Other
reserve
Translation
reserve
Statutory
reserve
Retained
profits Total
Non-
controlling
interests Total equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 35) (note 37(a)) (note 37(b)) (note 37(c)) (note 37(d)) (note 37(e))
At January 1, 2025 ...... 420,000 4,067,102 164,807 (3,049) 1,149 203,752 273,162 5,126,923 9,454 5,136,377
Profit for the period ...... —————— 523,089 523,089 (4,170) 518,919
Other comprehensive loss for
the period:
Share of other comprehensive
loss of associates ...... ———— (40) — — (40) — (40)
Exchange differences on
translation of foreign
operations ......... ———— (148) — — (148) — (148)
Total comprehensive income
for the period ....... ———— (188) — 523,089 522,901 (4,170) 518,731
Capital injection by
non-controlling interests ... ———————— 10,533 10,533
Dividends declared ...... —————— (168,000) (168,000) — (168,000)
Exercise of share options ... 5,509 198,490 (99,440) ———— 104,559 — 104,559
Share-based payment
compensation ........ — — 82,092 ———— 82,092 — 82,092
At October 31, 2025 ..... 425,509
4,265,592
* 147,459* (3,049)* 961* 203,752* 628,251* 5,668,475 15,817 5,684,292
* These reserve accounts comprise total reserve of RMB5,307,867,000, RMB4,257,493,000, RMB4,706,923,000 and
RMB5,242,966,000 in the consolidated statements of financial position as at December 31, 2022, 2023 and 2024
and October 31, 2025, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-13 –


--- page 473 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS
Notes Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
CASH FLOWS FROM OPERATING
ACTIVITIES
Profit before tax ................. 483,322 137,426 329,583 222,084 589,916
Adjustment for:
Finance costs ................... 8 16,976 6,638 10,061 9,088 13,470
Share of profits and losses of associates ... 5,825 (5,685) (13,166) (4,901) (5,573)
Bank interest income .............. 6 (40,719) (40,832) (20,699) (17,017) (33,312)
(Gains)/losses on disposal of property, plant
and equipment, right-of-use assets and
other non-current asset ............ 6 (775) (207) 84 261 303
Fair value gains on liabilities from
contingent consideration ........... 6 — — (60,160) — (8,523)
Depreciation of property, plant and
equipment .................... 7 25,440 28,240 29,330 23,837 35,267
Depreciation of right-of-use assets ...... 7 51,907 50,572 44,239 36,425 35,724
Amortisation of intangible assets ....... 7 2,083 2,407 2,612 2,138 2,228
Depreciation of investment properties .... 7 77 77 77 65 65
Write-down of inventories to net realisable
value ...................... 7 23,280 47,409 25,490 20,352 31,259
Impairment loss recognised on financial
assets and contract assets under ECL
model, net .................... 7 22,780 17,397 23,355 29,575 26,209
Gain on remeasurement of pre-existing
interest in an associate ............ 6 — (15,360) — — —
Gains on derecognition of financial
liabilities measured at amortised cost ... 6 (639) (500) (930) (540) (21)
Impairment of goodwill ............. 7 — — 79,640 — 61,399
Impairment of an investment in an
associate ..................... 7 55,768 ————
Share-based payment compensation ...... 36 (10,260) 12,736 152,071 127,357 82,092
Foreign exchange differences, net ....... (1,753) 7,053 2,345 4,610 24,586
APPENDIX I ACCOUNTANTS’ REPORT
– I-14 –


--- page 474 ---
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Operating profit before working capital changes ... 633,312 247,371 603,932 453,334 855,089
Derease/(increase) in inventories ............. 271,075 (116,061) 11,518 (113,548) (860,941)
(Increase)/decrease in trade and bills receivables ... (184,448) 119,035 (1,813,724) (1,548,215) (2,774,793)
Derease/(increase) in contract assets ........... 17,054 (168) (5,387) (5,747) (21,343)
Derease/(increase) in prepayments, other receivables
and other assets ...................... 55,241 (25,477) (40,125) (13,092) (15,940)
(Increase)/decrease in restricted cash .......... — (1,816) 1,483 (3,836) (209)
Increase in trade and bills payables ........... 216,978 309,663 1,361,730 1,107,026 1,771,643
(Decrease)/increase in other payables and accruals .. (227,502) (135,476) 25,418 (43,981) 293,675
(Decrease)/increase in contract liabilities ........ (35,615) 39,799 (10,859) 26,896 6,528
Decrease in deferred income ............... (1,010) (1,171) (513) (564) (596)
(Decrease)/increase in provision ............. (5,470) (15,744) 8,065 8,627 17,497
Cash generated from/(used in) operations ........ 739,615 419,955 141,538 (133,100) (729,390)
Interests received ...................... 40,719 40,832 20,699 17,017 13,821
Income tax paid ....................... (124,980) (44,013) (7,251) (7,248) (38,787)
Net cash flows from/(used in) operating activities .. 655,354 416,774 154,986 (123,331) (754,356)
APPENDIX I ACCOUNTANTS’ REPORT
– I-15 –


--- page 475 ---
Notes Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchases of items of property, plant
and equipment, other intangible
assets and other non-current assets .. (143,825) (242,422) (224,111) (195,221) (114,211)
Proceeds from disposal of items of
property, plant and equipment, and
other non-current asset .......... 62 570 144 93 78
Addition of investment in an associate . (2,000) ————
Dividend received from an associate .. ———— 2,550
Acquisition of a subsidiary ......... 39 — (69,086) — — —
Increase in time deposits .......... — — (400,000) (400,000) —
Net cash flows used in investing
activities .................... (145,763) (310,938) (623,967) (595,128) (111,583)
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from issue of shares ....... 35 3,093,327 ————
Proceeds from exercising share
options ..................... ———— 104,564
Proceeds from capital injection by
non-controlling interests ......... ———— 10,533
Share issue expenses ............. (15,375) ————
Listing expense paid ............. ———— (12,883)
Proceeds of borrowings from banks ... 277,875 75,739 867,063 485,530 1,610,791
Repayment of borrowings from banks . (871,501) — (728,845) (510,153) (1,024,724)
Interest paid ................... (8,908) (382) (3,676) (3,458) (8,852)
Lease payment and payment for lease
related deposits ............... (50,864) (49,650) (40,756) (34,949) (37,584)
Acquisition of non-controlling
interests .................... — (3,553) — — —
Dividends paid ................. (168,000) (1,197,000) — — (168,000)
Net cash flows from/(used in)
financing activities ............. 2,256,554 (1,174,846) 93,786 (63,030) 473,845
APPENDIX I ACCOUNTANTS’ REPORT
– I-16 –


--- page 476 ---
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
NET INCREASE/(DECREASE) IN CASH
AND CASH EQUIV ALENTS .......... 2,766,145 (1,069,010) (375,195) (781,489) (392,094)
Cash and cash equivalents at beginning of
year/period ........................ 219,259 2,986,535 1,916,965 1,916,965 1,539,131
Effect of foreign exchange rate changes, net .. 1,131 (560) (2,639) (2,074) (693)
CASH AND CASH EQUIV ALENTS AT END
OF YEAR/PERIOD ................. 2,986,535 1,916,965 1,539,131 1,133,402 1,146,344
APPENDIX I ACCOUNTANTS’ REPORT
– I-17 –


--- page 477 ---
STATEMENTS OF FINANCIAL POSITION OF THE COMPANY
Notes As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment .. 15 80,300 64,578 89,583 95,571
Right-of-use assets ........... 17(a) 94,592 51,644 28,506 15,225
Other intangible assets ........ 19 6,046 5,303 4,171 3,843
Investment in subsidiaries ..... 25 571,018 883,746 929,356 847,275
Investments in associates ...... 20 2,705 — — —
Trade and bills receivables ..... 22 117,130 39,738 91,782 398,257
Prepayments, other receivables
and other assets ........... 23 41,200 31,580 30,560 15,797
Deferred tax assets ........... 34 51,311 55,348 37,370 74,264
Time deposits ............... 26 — — 400,000 417,114
Total non-current assets ....... 964,302 1,131,937 1,611,328 1,867,346
CURRENT ASSETS
Inventories ................. 21 755,068 659,604 580,436 1,026,397
Trade and bills receivables ..... 22 1,889,136 1,403,703 2,251,280 3,607,265
Contract assets .............. 24 14,758 14,971 18,216 34,963
Prepayments, other receivables
and other assets ........... 23 287,128 663,530 974,186 1,098,049
Restricted cash .............. 26 — 1,816 330 542
Cash and cash equivalents ..... 26 2,893,102 1,812,165 1,289,700 1,050,104
Total current assets .......... 5,839,192 4,555,789 5,114,148 6,817,320
APPENDIX I ACCOUNTANTS’ REPORT
– I-18 –


--- page 478 ---
Notes As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
CURRENT LIABILITIES
Trade and bills payables ....... 27 596,973 466,069 1,023,167 1,817,210
Contract liabilities ........... 28 14,876 31,532 30,247 42,601
Other payables and accruals .... 31 380,511 246,546 218,718 330,431
Liabilities from contingent
consideration ............. 33 — 68,683 8,523 —
Interest-bearing borrowings .... 32 17,174 75,744 2,426 645,295
Lease liabilities ............. 17(b) 35,922 24,486 23,833 13,162
Income tax payable .......... 34,048 — 2,566 62,726
Provision .................. 30 16,446 11,422 15,053 18,638
Total current liabilities ........ 1,095,950 924,482 1,324,533 2,930,063
NET CURRENT ASSETS ..... 4,743,242 3,631,307 3,789,615 3,887,257
TOTAL ASSETS LESS
CURRENT LIABILITIES ... 5,707,544 4,763,244 5,400,943 5,754,603
NON-CURRENT
LIABILITIES
Interest-bearing borrowings .... 32 — — 211,050 179,960
Deferred income ............. 29 2,713 1,662 1,105 641
Provision .................. 30 13,419 2,619 6,599 20,058
Lease liabilities ............. 17(b) 62,777 30,933 7,564 3,288
Deferred tax liabilities ........ 7 8 3———
Total non-current liabilities .... 79,692 35,214 226,318 203,947
Net assets .................. 5,627,852 4,728,030 5,174,625 5,550,656
EQUITY
Equity attributable to owners
of the parent .............
Share capital ............... 35 420,000 420,000 420,000 425,509
Reserves ................... 37 5,207,852 4,308,030 4,754,625 5,125,147
Total equity ................ 5,627,852 4,728,030 5,174,625 5,550,656
APPENDIX I ACCOUNTANTS’ REPORT
– I-19 –


--- page 479 ---
II NOTES TO THE HISTORICAL FINANCIAL INFORMATION
1. CORPORATE INFORMATION
The Company is incorporated in the People’s Republic of China (“ PRC”) and was converted
into a joint stock company on November 11, 2020. The registered office of the Company is located
at Han’s Laser Global Intelligent Manufacturing Center, Baoan District, Shenzhen, Guangdong
province, China. The Company’s A shares are listed on Shenzhen Stock Exchange on February 28,
2022.
During the Relevant Periods, the Company and its subsidiaries (collectively the “ Group ”)
were involved in the research, manufacturing and trading of production equipment of printed
circuit board (“ PCB”).
The immediate holding company of the Company is Han’s Laser Technology Industry Group
C o . ,L t d .( “Han’s Laser ”) a listed company on Shenzhen Stock Exchange, the ultimate holding
company of the Company is Dazu Holdings Group Co., Ltd., and the ultimate controlling person of
the Company is Mr. Gao Yunfeng.
As at the date of this report, the Company had direct and indirect interests in its subsidiaries,
all of which are private limited liability companies, the particulars of which are set out below:
Name
Place and date of
incorporation/
registration and
place of operations
Nominal value
of registered
share capital
Percentage
of equity
attributable
to the Company
Principal activitiesDirect Indirect
Han’s CNC Technology
(Xinfeng) Co., Ltd.*
(note (ii))Ҧ
(ᔮ)ʮ̡ .......
PRC/
Chinese
mainland
November 15,
2022
RMB140,000,000 100% — Manufacturing and
trading of PCB
equipment
Asia Foundation (Shenzhen)
Wood Industry Co., Ltd.*
(note (iv))ܔ(ଉέ)
ʮ̡ .........
PRC/
Chinese
mainland
January 14,
2000
RMB82,884,000 100% — Park operation
APPENDIX I ACCOUNTANTS’ REPORT
– I-20 –


--- page 480 ---
Name
Place and date of
incorporation/
registration and
place of operations
Nominal value
of registered
share capital
Percentage
of equity
attributable
to the Company
Principal activitiesDirect Indirect
Shanghai Han’s Machinery
Co., Ltd.* (note (v))
ʮ̡ ..
PRC/
Chinese
mainland
February 8,
2023
RMB50,000,000 100% — Research,
manufacturing
and trading of
PCB equipment
Shenzhen Han’s
Microelectronics
Technology Co., Ltd.*
(notes (i) and (x)) (“Han’s
Microelectronics ”)
Ҧ
ʮ̡ ............
PRC/
Chinese
mainland
June 7, 2021
RMB50,000,000 70% — Research,
manufacturing
and trading of
PCB equipment
Shenzhen Mason Electronics
Co., Ltd.* (note (iii))
ʮ̡ ...
PRC/
Chinese
mainland
November 17,
1999
RMB25,800,000 100% — Research,
manufacturing
and trading of
PCB equipment
Shenzhen Han’s Rayleigh
Taide Precision Coating
Co., Ltd.* (“ Rayleigh
Taide”) (note (vi))
ଉέ̹ɽૄ๿лइᅃၚ੗
ʮ̡ .........
PRC/
Chinese
mainland
August 1, 2022
RMB20,000,000 70% — Research,
manufacturing
and trading
Advanced Intelligent Machine
Co., Ltd.*
(notes (iv) and (vii))
ࠢ
ʮ̡ ..............
PRC/
Chinese
mainland
January 17,
2014
RMB10,000,000 100% — Research,
manufacturing
and trading of
PCB equipment
APPENDIX I ACCOUNTANTS’ REPORT
– I-21 –


--- page 481 ---
Name
Place and date of
incorporation/
registration and
place of operations
Nominal value
of registered
share capital
Percentage
of equity
attributable
to the Company
Principal activitiesDirect Indirect
Mason Electronics (Xinfeng)
Co., Ltd.* (note (xi))
௥Ⴥཥɿ(ᔮ)ʮ̡ ..
PRC/
Chinese
mainland
November 15,
2022
RMB5,000,000 — 100% Manufacturing and
trading of PCB
equipment
Suzhou MASON Electronics
Testing Co., Ltd.* (note (i))
ࠢ
ʮ̡ ..............
PRC/
Chinese
mainland
September 25,
2007
RMB500,000 — 100% Provision of
processing
services
Han’s Mason Electronics
(HK) Co., Ltd. (note (ix)) .
Hong Kong
October 14,
2008
HK$10,000 — 100% Trading of PCB
equipment
Hong Kong Mason
Electronics Co., Ltd.
(note (ix)) ...........
Hong Kong
June 4, 2021
HK$200,000 — 100% Trading of PCB
equipment
HANS CNC TECHNOLOGY
(THAILAND) CO., LTD.
(note (i)) ............
Thailand
June 12, 2024
Thai Bhat
(“THB”)
15,000,000
— 99% After-sales service
HANS CNC SINGAPORE
PTE. LTD. (note (i)) ....
Singapore
November 6,
2024
Singapore dollar
(“SGD”)
100,000
100% — Research,
manufacturing
and trading of
PCB equipment
Notes:
* The English names of the above company registered in the PRC represents the best efforts made by the directors of
the Company in directly translating the Chinese names of these companies as no English names have been
registered.
(i) As at the date of this report, no audited financial statements have been prepared for these entities for the years
ended December 31, 2022, 2023 and 2024 as these entities were not subject to any statutory audit requirements
under the relevant rules and regulations in the jurisdictions of incorporation.
APPENDIX I ACCOUNTANTS’ REPORT
– I-22 –


--- page 482 ---
(ii) The statutory financial statements of this entity for the years ended December 31, 2023 and 2024 prepared under
China Accounting Standards for Business Enterprises (“ CAS”) were audited by RSM China (ה( त
౷ஷΥྫ )), certified public accountants registered in the PRC.
(iii) The statutory financial statements of this entity for the years ended December 31, 2022 prepared under CAS were
audited by Shenzhen Tongde Certified Public Accountants (General Partnership) (ה( ౷ஷΥ
ྫ)), certified public accountants registered in the PRC. The statutory financial statements of this entity for the
years ended December 31, 2023 and 2024 prepared under CAS were audited by RSM China (ה( त
౷ஷΥྫ )), certified public accountants registered in the PRC.
(iv) The statutory financial statements of these entities for the years ended December 31, 2022, 2023 and 2024 prepared
under CAS were audited by Shenzhen Tongde Certified Public Accountants (General Partnership) (ࢪࠇ
ה(౷ஷΥྫ)), certified public accountants registered in the PRC.
(v) The statutory financial statements of this entity for the years ended December 31, 2023 and 2024 prepared under
CAS were audited by Shenzhen Tongde Certified Public Accountants (General Partnership) (ԫਕ
ה(౷ஷΥྫ)), certified public accountants registered in the PRC.
(vi) Prior to the acquisition of 60% interest in Rayleigh Taide by the Group on May 30, 2023, Rayleigh Taide was an
associate of the Group. The statutory financial statements of this entity for the years ended December 31, 2023 and
2024 prepared under CAS were audited by Shenzhen Tongde Certified Public Accountants (General Partnership) ( ଉ
ה( ౷ஷΥྫ)), certified public accountants registered in the PRC.
(vii) The entity was a 70%-owned subsidiary of the Group as at December 31, 2022. The Group acquired the remaining
30% interests during the year ended December 31, 2023 and the entity became a wholly-owned subsidiary as at
December 31, 2023 and 2024 and October 31, 2025.
(viii) Dongguan Han’s CNC Technology Co., Ltd.Ҧ (୷̹)ʮ̡ was deregistered during the year
ended December 31, 2024, As at the date of this report, no audited financial statements have been prepared for this
entity for the years ended December 31, 2022 and 2023 as this entity was not subject to any statutory audit
requirements under the relevant rules and regulations in the jurisdictions of incorporation.
(ix) The statutory financial statements of these entities for the years ended December 31, 2022, 2023 and 2024 prepared
under HKFRS Accounting Standards were audited by New Choice C.P.A. & Co. registered in Hong Kong.
(x) The entity was a wholly-owned subsidiary of the Group as at December 31, 2022, 2023 and 2024. The interest of
the equity was reduced to 70% in 2025 due to the issue of shares to certain non-controlling interest shareholders.
(xi) The statutory financial statements of this entity for the year ended December 31, 2024 prepared under CAS were
audited by Shenzhen Tongde Certified Public Accountants (General Partnership) (ה( ౷ஷΥ
ྫ)), certified public accountants registered in the PRC.
2.1 BASIS OF PREPARATION
The Historical Financial Information has been prepared in accordance with IFRS Accounting
Standards, which comprise all standards and interpretations as approved by the International
Accounting Standards Board (“ IASB”). All IFRS Accounting Standards effective for the
accounting period commencing from January 1, 2025 together with the relevant transitional
APPENDIX I ACCOUNTANTS’ REPORT
– I-23 –


--- page 483 ---
provisions, have been adopted by the Group in the preparation of the Historical Financial
Information throughout the Relevant Periods and in the period covered by the Interim Comparative
Financial Information.
The Historical Financial Information has been prepared under the historical cost convention,
except for certain portion of trade and bills receivable and financial liabilities at fair value through
profit or loss which has been measured at fair value.
Basis of consolidation
The Historical Financial Information includes the financial information of the Company and
its subsidiaries for the Relevant Periods. A subsidiary is an entity (including a structured entity),
directly or indirectly, controlled by the Company. Control is achieved when the Group is exposed,
or has rights, to variable returns from its involvement with the investee and has the ability to
affect those returns through its power over the investee (i.e., existing rights that give the Group the
current ability to direct the relevant activities of the investee).
Generally, there is a presumption that a majority of voting rights results in control. When the
Company has less than a majority of the voting or similar rights of an investee, the Group
considers all relevant facts and circumstances in assessing whether it has power over an investee,
including:
(a) the contractual arrangement with the other vote holders of the investee;
(b) rights arising from other contractual arrangements; and
(c) the Group’s voting rights and potential voting rights.
The financial statements of the subsidiaries are prepared for the same reporting period as the
Company, using consistent accounting policies. The results of subsidiaries are consolidated from
the date on which the Group obtains control, and continue to be consolidated until the date that
such control ceases.
Profit or loss and each component of other comprehensive income are attributed to the
owners of the parent of the Group and to the non-controlling interests, even if this results in the
non-controlling interests having a deficit balance. All intra-group assets and liabilities, equity,
income, expenses and cash flows relating to transactions between members of the Group are
eliminated in full on consolidation.
APPENDIX I ACCOUNTANTS’ REPORT
– I-24 –


--- page 484 ---
The Group reassesses whether or not it controls an investee if facts and circumstances
indicate that there are changes to one or more of the three elements of control described above. A
change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an
equity transaction.
If the Group loses control over a subsidiary, it derecognises the related assets (including
goodwill), liabilities, any non-controlling interest and the exchange fluctuation reserve; and
recognises the fair value of any investment retained and any resulting surplus or deficit in profit or
loss. The Group’s share of components previously recognised in other comprehensive income is
reclassified to profit or loss or retained profits, as appropriate, on the same basis as would be
required if the Group had directly disposed of the related assets or liabilities.
2.2 ISSUED BUT NOT YET EFFECTIVE IFRS ACCOUNTING STANDARDS
The Group has not applied the following new and amended IFRS Accounting Standards, that
have been issued but are not yet effective, in the Historical Financial Information. The Group
intends to apply these new and amended IFRS Accounting Standards, if applicable, when they
become effective.
IFRS 18 Presentation and Disclosure in Financial Statements
2
IFRS 19 and its amendments Subsidiaries without Public Accountability: Disclosures 2
Amendments to IFRS 9
and IFRS 7
Amendments to the Classification and Measurement of
Financial Instruments 1
Amendments to IFRS 9
and IFRS 7
Contracts Referencing Nature-dependent Electricity 1
Amendments to IFRS 10
and IAS 28
Sale or Contribution of Assets between an Investor and its
Associate or Joint V enture 3
Amendments to IAS 21 Translation to a Hyperinflationary Presentation Currency 2
Annual Improvements to IFRS
Accounting Standards —
V olume 11
Amendments to IFRS 1, IFRS 7, IFRS 9, IFRS 10
and IAS 7
1
Notes
1 Effective for annual periods beginning on or after January 1, 2026
2 Effective for annual/reporting periods beginning on or after January 1, 2027
3 No mandatory effective date yet determined but available for adoption
The Group is in the process of making an assessment of the impact of these new and revised
IFRS Accounting Standards upon initial application. So far, the Group considers that these new
and revised IFRS Accounting Standards except for IFRS 18, may result in changes in accounting
APPENDIX I ACCOUNTANTS’ REPORT
– I-25 –


--- page 485 ---
policies and no significant impact on the Group’s financial performance and financial position is
expected in the period of initial application. The application of IFRS 18 is not expected to have
material impact on the financial position of the Group but is expected to affect the presentation of
the statements of profit or loss and statement of cash flows and disclosures in the future financial
information. The Group will continue to assess the impact of IFRS 18 on the Group’s financial
information.
2.3 MATERIAL ACCOUNTING POLICY INFORMATION
Investments in associates
An associate is an entity in which the Group has a long term interest of generally not less
than 20% of the equity voting rights and over which it has significant influence. Significant
influence is the power to participate in the financial and operating policy decisions of the investee,
but is not control or joint control over those policies.
The Group’s investments in associates are stated in the consolidated statement of financial
position at the Group’s share of net assets under the equity method of accounting, less any
impairment losses.
The Group’s share of the post-acquisition results and other comprehensive income of
associates is included in the consolidated statement of profit or loss and consolidated other
comprehensive income, respectively. In addition, when there has been a change recognised directly
in the equity of the associate, the Group recognises its share of any changes, when applicable, in
the consolidated statement of changes in equity. Unrealised gains and losses resulting from
transactions between the Group and its associates are eliminated to the extent of the Group’s
investments in the associates, except where unrealised losses provide evidence of an impairment of
the assets transferred. Goodwill arising from the acquisition of associates is included as part of the
Group’s investments in associates.
Upon loss of significant influence over the associate, the Group measures and recognises any
retained investment at its fair value. Any difference between the carrying amount of the associate
upon loss of significant influence and the fair value of the retained investment and proceeds from
disposal is recognised in profit or loss.
Business combinations and goodwill
Business combinations are accounted for using the acquisition method. The consideration
transferred is measured at the acquisition date fair value which is the sum of the acquisition date
fair values of assets transferred by the Group, liabilities assumed by the Group to the former
APPENDIX I ACCOUNTANTS’ REPORT
– I-26 –


--- page 486 ---
owners of the acquiree and the equity interests issued by the Group in exchange for control of the
acquiree. For each business combination, the Group elects whether to measure the non-controlling
interests in the acquiree at fair value or at the proportionate share of the acquiree’s identifiable net
assets. All other components of non-controlling interests are measured at fair value.
Acquisition-related costs are expensed as incurred.
The Group determines that it has acquired a business when the acquired set of activities and
assets includes an input and a substantive process that together significantly contribute to the
ability to create outputs.
When the Group acquires a business, it assesses the financial assets and liabilities assumed
for appropriate classification and designation in accordance with the contractual terms, economic
circumstances and pertinent conditions as at the acquisition date. This includes the separation of
embedded derivatives in host contracts of the acquiree.
If the business combination is achieved in stages, the previously held equity interest is
remeasured at its acquisition date fair value and any resulting gain or loss is recognised in profit
or loss or other comprehensive income, as appropriate.
Any contingent consideration to be transferred by the acquirer is recognised at fair value at
the acquisition date. Contingent consideration classified as an asset or liability is measured at fair
value with changes in fair value recognised in profit or loss. Contingent consideration that is
classified as equity is not remeasured and subsequent settlement is accounted for within equity.
Goodwill is initially measured at cost, being the excess of the aggregate of the consideration
transferred, the amount recognised for non-controlling interests and any fair value of the Group’s
previously held equity interests in the acquiree over the identifiable assets acquired and liabilities
assumed. If the sum of this consideration and other items is lower than the fair value of the net
assets acquired, the difference is, after reassessment, recognised in profit or loss as a gain on
bargain purchase.
After initial recognition, goodwill is measured at cost less any accumulated impairment
losses. Goodwill is tested for impairment annually or more frequently if events or changes in
circumstances indicate that the carrying value may be impaired. The Group performs its annual
impairment test of goodwill as at December 31. For the purpose of impairment testing, goodwill
acquired in a business combination is, from the acquisition date, allocated to each of the Group’s
cash-generating units, or groups of cash-generating units, that are expected to benefit from the
synergies of the combination, irrespective of whether other assets or liabilities of the Group are
assigned to those units or groups of units.
APPENDIX I ACCOUNTANTS’ REPORT
– I-27 –


--- page 487 ---
Impairment is determined by assessing the recoverable amount of the cash-generating unit
(group of cash-generating units) to which the goodwill relates. Where the recoverable amount of
the cash-generating unit (group of cash-generating units) is less than the carrying amount, an
impairment loss is recognised. An impairment loss recognised for goodwill is not reversed in a
subsequent period.
Where goodwill has been allocated to a cash-generating unit (or group of cash-generating
units) and part of the operation within that unit is disposed of, the goodwill associated with the
operation disposed of is included in the carrying amount of the operation when determining the
gain or loss on the disposal. Goodwill disposed of in these circumstances is measured based on the
relative value of the operation disposed of and the portion of the cash-generating unit retained.
Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in
an orderly transaction between market participants at the measurement date. The fair value
measurement is based on the presumption that the transaction to sell the asset or transfer the
liability takes place either in the principal market for the asset or liability, or in the absence of a
principal market, in the most advantageous market for the asset or liability. The principal or the
most advantageous market must be accessible by the Group. The fair value of an asset or a
liability is measured using the assumptions that market participants would use when pricing the
asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s
ability to generate economic benefits by using the asset in its highest and best use or by selling it
to another market participant that would use the asset in its highest and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which
sufficient data are available to measure fair value, maximising the use of relevant observable
inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the Historical
Financial Information are categorised within the fair value hierarchy, described as follows, based
on the lowest level input that is significant to the fair value measurement as a whole:
Level 1 — based on quoted prices (unadjusted) in active markets for identical assets or
liabilities
Level 2 — based on valuation techniques for which the lowest level input that is significant
to the fair value measurement is observable, either directly or indirectly
APPENDIX I ACCOUNTANTS’ REPORT
– I-28 –


--- page 488 ---
Level 3 — based on valuation techniques for which the lowest level input that is significant
to the fair value measurement is unobservable
For assets and liabilities that are recognised in the Historical Financial Information on a
recurring basis, the Group determines whether transfers have occurred between levels in the
hierarchy by reassessing categorisation (based on the lowest level input that is significant to the
fair value measurement as a whole) at the end of each of the Relevant Periods.
Impairment of non-financial assets
Where an indication of impairment exists, or when annual impairment testing for a
non-financial asset is required (other than inventories, contract assets, deferred tax assets and
financial assets), the asset’s recoverable amount is estimated. An asset’s recoverable amount is the
higher of the asset’s or cash-generating unit’s value in use and its fair value less costs of disposal,
and is determined for an individual asset, unless the asset does not generate cash inflows that are
largely independent of those from other assets or groups of assets, in which case the recoverable
amount is determined for the cash-generating unit to which the asset belongs.
An impairment loss is recognised only if the carrying amount of an asset exceeds its
recoverable amount. In assessing value in use, the estimated future cash flows are 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. An impairment loss is charged to the
statement of profit or loss in the period in which it arises in those expense categories consistent
with the function of the impaired asset.
An assessment is made at the end of each of the Relevant Periods as to whether there is an
indication that previously recognised impairment losses may no longer exist or may have
decreased. If such an indication exists, the recoverable amount is estimated. A previously
recognised impairment loss of an asset other than goodwill is reversed only if there has been a
change in the estimates used to determine the recoverable amount of that asset, but not to an
amount higher than the carrying amount that would have been determined (net of any
depreciation/amortisation) had no impairment loss been recognised for the asset in prior years. A
reversal of such an impairment loss is credited to the statement of profit or loss in the period in
which it arises.
APPENDIX I ACCOUNTANTS’ REPORT
– I-29 –


--- page 489 ---
Related parties
A party is considered to be related to the Group if:
(a) the party is a person or a close member of that person’s family and 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 of a parent of the
Group;
or
(b) the party is an entity where any of the following conditions applies:
(i) the entity and the Group are members of the same group;
(ii) one entity is an associate or joint venture of the other entity (or of a parent,
subsidiary or fellow subsidiary of the other entity);
(iii) the entity and the Group 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); and
(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 parent of the Group.
APPENDIX I ACCOUNTANTS’ REPORT
– I-30 –


--- page 490 ---
Property, plant and equipment and depreciation
Property, plant and equipment, other than construction in progress, are stated at cost less
accumulated depreciation and any impairment losses. The cost of an item of property, plant and
equipment comprises its purchase price and any directly attributable costs of bringing the asset to
its working condition and location for its intended use.
Expenditure incurred after items of property, plant and equipment have been put into
operation, such as repairs and maintenance, is normally charged to the statement of profit or loss
in the period in which it is incurred. In situations where the recognition criteria are satisfied, the
expenditure for a major inspection is capitalised in the carrying amount of the asset as a
replacement. Where significant parts of property, plant and equipment are required to be replaced
at intervals, the Group recognises such parts as individual assets with specific useful lives and
depreciates them accordingly.
Depreciation is calculated on the straight-line basis to write off the cost of each item of
property, plant and equipment to its residual value over its estimated useful life. The principal
annual rates used for this purpose are as follows:
Buildings 2.4%
Machinery 9.6% to 19.2%
Motor vehicles 19.2%
Electronic equipment 19.2%
Other equipment 19.2%
Leasehold improvements Over the shorter of the lease terms and 5 years (20%)
Where parts of an item of property, plant and equipment have different useful lives, the cost
of that item is allocated on a reasonable basis among the parts and each part is depreciated
separately. Residual values, useful lives and the depreciation method are reviewed, and adjusted if
appropriate, at least at each financial year end.
An item of property, plant and equipment including any significant part initially recognised is
derecognised upon disposal or when no future economic benefits are expected from its use or
disposal. Any gain or loss on disposal or retirement recognised in the statement of profit or loss in
the year the asset is derecognised is the difference between the net sales proceeds and the carrying
amount of the relevant asset.
Construction in progress is stated at cost less any impairment losses, and is not depreciated.
It is reclassified to the appropriate category of property, plant and equipment when completed and
ready for use.
APPENDIX I ACCOUNTANTS’ REPORT
– I-31 –


--- page 491 ---
Investment properties
Investment properties are interests in land and buildings (including right-of-use assets) held
to earn rental income and/or for capital appreciation. Such properties are measured initially at cost,
including transaction costs. Subsequent to initial recognition, investment properties are stated at
cost less any impairment losses and are amortised to its residual value on the straight-line basis
over their estimated useful lives of 40 years.
Intangible assets (other than goodwill)
Intangible assets acquired separately are measured on initial recognition at cost. The cost of
intangible assets acquired in a business combination is the fair value at the date of acquisition. The
useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets with
finite lives are subsequently amortised over the useful economic life and assessed for impairment
whenever there is an indication that the intangible asset may be impaired. The amortisation period
and the amortisation method for an intangible asset with a finite useful life are reviewed at least at
each financial year end.
Intangible assets are stated at cost less any impairment losses and are amortised on the
straight-line basis over their estimated useful lives. The principal estimated useful lives of
intangible assets are as follows:
Categories Estimated useful lives
Software ................................................ 3-10 years
Patents ................................................. 3-10 years
The estimated useful lives of intangible assets are determined by considering the period of
the economic benefits to the Group or the periods of validity of intangible assets protected by the
relevant laws, as well as by referring to the industry practice.
Research and development costs
All research costs are charged to profit or loss as incurred.
Expenditure incurred on projects to develop new products is capitalised and deferred only
when the Group can demonstrate the technical feasibility of completing the intangible asset so that
it will be available for use or sale, its intention to complete and its ability to use or sell the asset,
how the asset will generate future economic benefits, the availability of resources to complete the
project and the ability to measure reliably the expenditure during the development. Product
development expenditure which does not meet these criteria is expensed when incurred.
APPENDIX I ACCOUNTANTS’ REPORT
– I-32 –


--- page 492 ---
Leases
The Group assesses at contract inception whether a contract is, or contains, a lease. A
contract is, or contains, a lease if the contract conveys the right to control the use of an identified
asset for a period of time in exchange for consideration.
Group as a lessee
The Group applies a single recognition and measurement approach for all leases, except for
short-term leases and leases of low-value assets. The Group recognises lease liabilities to make
lease payments and right-of-use assets representing the right to use the underlying assets.
(a) Right-of-use assets
Right-of-use assets are recognised at the commencement date of the lease (that is the date the
underlying asset is available for use). Right-of-use assets are measured at cost, less accumulated
depreciation and any impairment losses, and adjusted for any remeasurement of lease liabilities.
The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct
costs incurred, and lease payments made at or before the commencement date less any lease
incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter of
the lease terms and the estimated useful lives of the assets as follows:
Land use rights 50 years
Buildings 2 to 10 years
If ownership of the leased asset transfers to the Group by the end of the lease term or the
cost reflects the exercise of a purchase option, depreciation is calculated using the estimated useful
life of the asset.
(b) Lease liabilities
Lease liabilities are recognised at the commencement date of the lease at the present value of
lease payments to be made over the lease term. The lease payments include fixed payments
(including in-substance fixed payments) less any lease incentives receivable, variable lease
payments that depend on an index or a rate, and amounts expected to be paid under residual value
guarantees. The lease payments also include the exercise price of a purchase option reasonably
certain to be exercised by the Group and payments of penalties for termination of a lease, if the
lease term reflects the Group exercising the option to terminate the lease. The variable lease
payments that do not depend on an index or a rate are recognised as an expense in the period in
which the event or condition that triggers the payment occurs.
APPENDIX I ACCOUNTANTS’ REPORT
– I-33 –


--- page 493 ---
In calculating the present value of lease payments, the Group uses its incremental borrowing
rate at the lease commencement date because the interest rate implicit in the lease is not readily
determinable. After the commencement date, the amount of lease liabilities is increased to reflect
the accretion of interest and reduced for the lease payments made. In addition, the carrying amount
of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in
lease payments (e.g., a change to future lease payments resulting from a change in an index or
rate) or a change in assessment of an option to purchase the underlying asset.
(c) Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition exemption to its short-term leases of
machinery and equipment (that is those leases that have a lease term of 12 months or less from the
commencement date and do not contain a purchase option). It also applies the recognition
exemption for leases of low-value assets to leases of office equipment and laptop computers that
are considered to be of low value.
Lease payments on short-term leases and leases of low-value assets are recognised as an
expense on a straight-line basis over the lease term.
Group as a lessor
When the Group acts as a lessor, it classifies at lease inception (or when there is a lease
modification) each of its leases as either an operating lease or a finance lease.
Leases in which the Group does not transfer substantially all the risks and rewards incidental
to ownership of an asset are classified as operating leases. When a contract contains lease and
non-lease components, the Group allocates the consideration in the contract to each component on
a relative stand-alone selling price basis. Rental income is accounted for on a straight-line basis
over the lease term and is included in revenue in the statement of profit or loss due to its operating
nature. Initial direct costs incurred in negotiating and arranging an operating lease are added to the
carrying amount of the leased asset and recognised over the lease term on the same basis as rental
income. Contingent rents are recognised as revenue in the period in which they are earned.
Investments and other financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortised
cost, fair value through other comprehensive income, and fair value through profit or loss.
APPENDIX I ACCOUNTANTS’ REPORT
– I-34 –


--- page 494 ---
The classification of financial assets at initial recognition depends on the financial asset’s
contractual cash flow characteristics and the Group’s business model for managing them. With the
exception of trade receivables that do not contain a significant financing component or for which
the Group has applied the practical expedient of not adjusting the effect of a significant financing
component, the Group initially measures a financial asset at its fair value plus in the case of a
financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do
not contain a significant financing component or for which the Group has applied the practical
expedient are measured at the transaction price determined under IFRS 15 in accordance with the
policies set out for “Revenue recognition” below.
In order for a financial asset to be classified and measured at amortised cost or fair value
through other comprehensive income, it needs to give rise to cash flows that are solely payments
of principal and interest (“ SPPI”) on the principal amount outstanding. Financial assets with cash
flows that are not SPPI are classified and measured at fair value through profit or loss, irrespective
of the business model.
The Group’s business model for managing financial assets refers to how it manages its
financial assets in order to generate cash flows. The business model determines whether cash flows
will result from collecting contractual cash flows, selling the financial assets, or both. Financial
assets classified and measured at amortised cost are held within a business model with the
objective to hold financial assets in order to collect contractual cash flows, while financial assets
classified and measured at fair value through other comprehensive income are held within a
business model with the objective of both holding to collect contractual cash flows and selling.
Financial assets which are not held within the aforementioned business models are classified and
measured at fair value through profit or loss.
Purchases or sales of financial assets that require delivery of assets within the period
generally established by regulation or convention in the marketplace are recognised on the trade
date, that is, the date that the Group commits to purchase or sell the asset.
Subsequent measurement
The subsequent measurement of financial assets depends on their classification as follows:
Financial assets at amortised cost (debt instruments)
Financial assets at amortised cost are subsequently measured using the effective interest
method and are subject to impairment. Gains and losses are recognised in the statement of profit or
loss when the asset is derecognised, modified or impaired.
APPENDIX I ACCOUNTANTS’ REPORT
– I-35 –


--- page 495 ---
Financial assets at fair value through other comprehensive income (debt instrument)
For debt investments at fair value through other comprehensive income, interest income,
foreign exchange revaluation and impairment losses or reversals are recognised in the statement of
profit or loss and computed in the same manner as for financial assets measured at amortised cost.
The remaining fair value changes are recognised in other comprehensive income. Upon
derecognition, the cumulative fair value change recognised in other comprehensive income is
recycled to the statement of profit or loss.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are carried in the statement of financial
position at fair value with net changes in fair value recognised in the statement of profit or loss.
Derecognition of financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar
financial assets) is primarily derecognised (i.e., removed from the Group’s consolidated statement
of financial position) when:
 the rights to receive cash flows from the asset have expired; or
 the Group has transferred its rights to receive cash flows from the asset or has assumed
an obligation to pay the received cash flows in full without material delay to a third
party under a “pass-through” arrangement; and either (a) the Group has transferred
substantially all the risks and rewards of the asset, or (b) the Group has neither
transferred nor retained substantially all the risks and rewards of the asset, but has
transferred control of the asset.
When the Group has transferred its rights to receive cash flows from an asset or has entered
into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risk and
rewards of ownership of the asset. When it has neither transferred nor retained substantially all the
risks and rewards of the asset nor transferred control of the asset, the Group continues to recognise
the transferred asset to the extent of the Group’s continuing involvement. In that case, the Group
also recognises an associated liability. The transferred asset and the associated liability are
measured on a basis that reflects the rights and obligations that the Group has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is
measured at the lower of the original carrying amount of the asset and the maximum amount of
consideration that the Group could be required to repay.
APPENDIX I ACCOUNTANTS’ REPORT
– I-36 –


--- page 496 ---
Impairment of financial assets
The Group recognises an allowance for expected credit losses (“ ECLs”) for all debt
instruments not held at fair value through profit or loss. ECLs are based on the difference between
the contractual cash flows due in accordance with the contract and all the cash flows that the
Group expects to receive, discounted at an approximation of the original effective interest rate.
The expected cash flows will include cash flows from the sale of collateral held or other credit
enhancements that are integral to the contractual terms.
General approach
ECLs are recognised in two stages. For credit exposures for which there has not been a
significant increase in credit risk since initial recognition, ECLs are provided for credit losses that
result from default events that are possible within the next 12 months (a 12-month ECL). For those
credit exposures for which there has been a significant increase in credit risk since initial
recognition, a loss allowance is required for credit losses expected over the remaining life of the
exposure, irrespective of the timing of the default (a lifetime ECL).
At each reporting date, the Group assesses whether the credit risk on a financial instrument
has increased significantly since initial recognition. When making the assessment, the Group
compares the risk of a default occurring on the financial instrument as at the reporting date with
the risk of a default occurring on the financial instrument as at the date of initial recognition and
considers reasonable and supportable information that is available without undue cost or effort,
including historical and forward-looking information. The Group considers that there has been a
significant increase in credit risk when contractual payments are more than 30 days past due.
The Group considers a financial asset in default when contractual payments are 90 days past
due. However, in certain cases, the Group may also consider a financial asset to be in default when
internal or external information indicates that the Group is unlikely to receive the outstanding
contractual amounts in full before taking into account any credit enhancements held by the Group.
A financial asset is written off when there is no reasonable expectation of recovering the
contractual cash flows.
APPENDIX I ACCOUNTANTS’ REPORT
– I-37 –


--- page 497 ---
Debt investments at fair value through other comprehensive income and financial assets at
amortised cost are subject to impairment under the general approach and they are classified within
the following stages for measurement of ECLs except for trade receivables and contract assets
which apply the simplified approach as detailed below.
Stage 1 — Financial instruments for which credit risk has not increased significantly since
initial recognition and for which the loss allowance is measured at an amount
equal to 12-month ECLs
Stage 2 — Financial instruments for which credit risk has increased significantly since initial
recognition but that are not credit-impaired financial assets and for which the loss
allowance is measured at an amount equal to lifetime ECLs
Stage 3 — Financial assets that are credit-impaired at the reporting date (but that are not
purchased or originated credit-impaired) and for which the loss allowance is
measured at an amount equal to lifetime ECLs
Simplified approach
For trade receivables and contract assets that do not contain a significant financing
component or when the Group applies the practical expedient of not adjusting the effect of a
significant financing component, the Group applies the simplified approach in calculating ECLs.
Under the simplified approach, the Group does not track changes in credit risk, but instead
recognises a loss allowance based on lifetime ECLs at each reporting date. The Group has
established a provision matrix that is based on its historical credit loss experience, adjusted for
forward-looking factors specific to the debtors and the economic environment.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value
through profit or loss, loans and borrowings, payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and
borrowings and payables, net of directly attributable transaction costs.
The Group’s financial liabilities include trade and bills payables, other payables and accruals
and interest-bearing bank borrowings and financial liabilities at fair value through profit or loss.
APPENDIX I ACCOUNTANTS’ REPORT
– I-38 –


--- page 498 ---
The Group classifies financial liabilities that arise from a supplier finance arrangement within
interest-bearing borrowings in the statement of financial position because based on the Group’s
assessment, The supplier finance arrangement is not part of the working capital used in the
Group’s normal operating cycle, the terms of the liabilities that are part of the supply chain finance
arrangement are substantially different from the terms of trade and bills payables that are not part
of the arrangement. The assessment has considered factors such as the commercial purpose, the
nature and specific terms of the arrangement, as well as the credit terms in place with the financial
institutions and suppliers. Therefore, cash flows related to liabilities arising from supplier finance
arrangements that are classified in interest-bearing borrowings in the statement of financial
position are included in financing activities in the statement of cash flows.
Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification as follows:
Financial liabilities at amortised cost (trade and bills payables, other payables and accruals and
interest-bearing bank borrowings)
After initial recognition, trade and bills payables, other payables and accruals, and
interest-bearing borrowings are subsequently measured at amortised cost, using the effective
interest rate method unless the effect of discounting would be immaterial, in which case they are
stated at cost. Gains and losses are recognised in the statement of profit or loss when the liabilities
are derecognised as well as through the effective interest rate amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition
and fees or costs that are an integral part of the effective interest rate. The effective interest rate
amortisation is included in finance costs in the statement of profit or loss.
Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or
cancelled, or expires.
When an existing financial liability is replaced by another from the same lender on
substantially different terms, or the terms of an existing liability are substantially modified, such
an exchange or modification is treated as a derecognition of the original liability and a recognition
of a new liability, and the difference between the respective carrying amounts is recognised in the
statement of profit or loss.
APPENDIX I ACCOUNTANTS’ REPORT
– I-39 –


--- page 499 ---
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the
statement of financial position if there is a currently enforceable legal right to offset the
recognised amounts and there is an intention to settle on a net basis, or to realise the assets and
settle the liabilities simultaneously.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined on the
weighted average cost basis and, in the case of work in progress and finished goods, comprises
direct materials, direct labour and an appropriate proportion of overheads. Net realisable value is
based on estimated selling prices less any estimated costs to be incurred to completion and
disposal.
Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash on hand and at
banks, and short-term highly liquid deposits with a maturity of generally within three months that
are readily convertible into known amounts of cash, subject to an insignificant risk of changes in
value and held for the purpose of meeting short-term cash commitments.
For the purpose of the consolidated statement of cash flows, cash and cash equivalents
comprise cash on hand and at banks, and short-term deposits as defined above.
Provisions
A provision is recognised when a present obligation (legal or constructive) has arisen as a
result of a past event and it is probable that a future outflow of resources will be required to settle
the obligation, provided that a reliable estimate can be made of the amount of the obligation.
When the effect of discounting is material, the amount recognised for a provision is the
present value at the end of each of the Relevant Periods of the future expenditures expected to be
required to settle the obligation. The increase in the discounted present value amount arising from
the passage of time is included in finance costs in the statement of profit or loss.
APPENDIX I ACCOUNTANTS’ REPORT
– I-40 –


--- page 500 ---
The Group provides for warranties in relation to the sale of certain industrial products for
general repairs of defects occurring during the warranty period. Provisions for these assurance-type
warranties granted by the Group are initially recognised based on sales volume and past experience
of the level of repairs and returns, discounted to their present values as appropriate. The
warranty-related cost is revised annually.
Income tax
Income tax comprises current and deferred tax. Income tax relating to items recognised
outside profit or loss is recognised outside profit or loss, either in other comprehensive income or
directly in equity.
Current tax assets and liabilities are measured at the amount expected to be recovered from or
paid to the taxation authorities, based on tax rates (and tax laws) that have been enacted or
substantively enacted by the end of the Relevant Periods, taking into consideration interpretations
and practices prevailing in the countries in which the Group operates.
Deferred tax is provided, using the liability method, on all temporary differences at the end
of each of the Relevant Periods between the tax bases of assets and liabilities and their carrying
amounts for financial reporting purposes.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
 when the deferred tax liability arises from the initial recognition of goodwill or an asset
or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss and does not
give rise to equal taxable and deductible temporary differences; and
 in respect of taxable temporary differences associated with investments in subsidiaries
and associates, when the timing of the reversal of the temporary differences can be
controlled and it is probable that the temporary differences will not reverse in the
foreseeable future.
APPENDIX I ACCOUNTANTS’ REPORT
– I-41 –


--- page 501 ---
Deferred tax assets are recognised for all deductible temporary differences, and the
carryforward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to
the extent that it is probable that taxable profit will be available against which the deductible
temporary differences, and the carryforward of unused tax credits and unused tax losses can be
utilised, except:
 when the deferred tax asset relating to the deductible temporary differences arises from
the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting profit nor
taxable profit or loss and does not give rise to equal taxable and deductible temporary
differences; and
 in respect of deductible temporary differences associated with investments in
subsidiaries, and associates, deferred tax assets are only recognised to the extent that it
is probable that the temporary differences will reverse in the foreseeable future and
taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at the end of each of the Relevant
Periods and reduced to the extent that it is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax
assets are reassessed at the end of each of the Relevant Periods and are recognised to the extent
that it has become probable that sufficient taxable profit will be available to allow all or part of
the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to
the period when the asset is realised or the liability is settled, based on tax rates (and tax laws)
that have been enacted or substantively enacted by the end of each of the Relevant Periods.
Deferred tax assets and deferred tax liabilities are offset if and only if the Group has a legally
enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets
and deferred tax liabilities relate to income taxes levied by the same taxation authority on either
the same taxable entity or different taxable entities which intend either to settle current tax
liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously,
in each future period in which significant amounts of deferred tax liabilities or assets are expected
to be settled or recovered.
APPENDIX I ACCOUNTANTS’ REPORT
– I-42 –


--- page 502 ---
Government grants
Government grants are recognised at their fair value where there is reasonable assurance that
the grant will be received and all attaching conditions will be complied with. When the grant
relates to an expense item, it is recognised as income on a systematic basis over the periods that
the costs, for which it is intended to compensate, are expensed.
Where the grant relates to an asset, the fair value is credited to a deferred income account
and is released to the statement of profit or loss over the expected useful life of the relevant asset
by equal annual instalments.
Revenue recognition
Revenue from contracts with customers
Revenue from contracts with customers is recognised when control of goods or services is
transferred to the customers at an amount that reflects the consideration to which the Group
expects to be entitled in exchange for those goods or services.
When the consideration in a contract includes a variable amount, the amount of consideration
is estimated to which the Group will be entitled in exchange for transferring the goods or services
to the customer. The variable consideration is estimated at contract inception and constrained until
it is highly probable that a significant revenue reversal in the amount of cumulative revenue
recognised will not occur when the associated uncertainty with the variable consideration is
subsequently resolved.
When the contract contains a financing component which provides the customer with a
significant benefit of financing the transfer of goods or services to the customer for more than one
year, revenue is measured at the present value of the amount receivable, discounted using the
discount rate that would be reflected in a separate financing transaction between the Group and the
customer at contract inception. When the contract contains a financing component which provides
the Group with a significant financial benefit for more than one year, revenue recognised under the
contract includes the interest expense accreted on the contract liability under the effective interest
method. For a contract where the period between the payment by the customer and the transfer of
the promised goods or services is one year or less, the transaction price is not adjusted for the
effects of a significant financing component, using the practical expedient in IFRS 15.
APPENDIX I ACCOUNTANTS’ REPORT
– I-43 –


--- page 503 ---
(a) Sale of industrial products
Revenue from the sale of goods is recognised at the point in time when control of the goods
is transferred to the customer, which for domestic sales are generally at the time of the completion
of installation and commissioning of the goods or generally on delivery of the goods as agreed in
the sales contracts, and for overseas sales are generally at the time of shipment in accordance with
Incoterms.
The periods and terms of product quality warranty are provided in accordance with the laws
and regulations related to the products. The Group has not provided any additional services or
product quality warranty, so the product quality warranty does not constitute a separate
performance obligation.
(b) Provision of after-sales and processing services
The Group provides after-sales services to customers, including repair and maintenance.
Revenue from after-sales services is recognised on a straight-line basis over the contract period.
The Group also provides processing services. Revenue from processing services is recognised
when the services are rendered.
Revenue from other sources
Rental income
Rental income is recognised on a time proportion basis over the lease terms. Variable lease
payments that do not depend on an index or a rate are recognised as income in the accounting
period in which they are incurred.
Other income
Interest income is recognised on an accrual basis using the effective interest method by
applying the rate that exactly discounts the estimated future cash receipts over the expected life of
the financial instrument or a shorter period, when appropriate, to the net carrying amount of the
financial asset.
Contract assets
If the Group performs by transferring goods or services to a customer before being
unconditionally entitled to the consideration under the contract terms, a contract asset is
recognised for the earned consideration that is conditional. Contract assets are subject to
APPENDIX I ACCOUNTANTS’ REPORT
– I-44 –


--- page 504 ---
impairment assessment, details of which are included in the accounting policies for impairment of
financial assets. They are reclassified to trade receivables when the right to the consideration
becomes unconditional.
Contract liabilities
A contract liability is recognised when a payment is received or a payment is due (whichever
is earlier) from a customer before the Group transfers the related goods or services. Contract
liabilities are recognised as revenue when the Group performs under the contract (i.e., transfers
control of the related goods or services to the customer).
Contract costs
Other than the costs which are capitalised as inventories, property, plant and equipment and
intangible assets, costs incurred to fulfil a contract with a customer are capitalised as an asset if all
of the following criteria are met:
(a) The costs relate directly to a contract or to an anticipated contract that the entity can
specifically identify.
(b) The costs generate or enhance resources of the entity that will be used in satisfying (or
in continuing to satisfy) performance obligations in the future.
(c) The costs are expected to be recovered.
The capitalised contract costs are amortised and charged to the statement of profit or loss on
a systematic basis that is consistent with the transfer to the customer of the goods or services to
which the asset relates. Other contract costs are expensed as incurred.
Share-based payments
The Company operates a Share-based payments scheme. Employees (including directors) of
the Group receive remuneration in the form of share-based payments, whereby employees render
services in exchange for equity instruments (“ equity-settled transactions ”). The cost of
equity-settled transactions with employees is measured by reference to the fair value at the date at
which they are granted. The fair value is determined by an external valuer, further details of which
are given in note 36 to the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-45 –


--- page 505 ---
The cost of equity-settled transactions is recognised in employee benefit expense, together
with a corresponding increase in equity, over the period in which the performance and/or service
conditions are fulfilled. The cumulative expense recognised for equity-settled transactions at the
end of each reporting period until the vesting date reflects the extent to which the vesting period
has expired and the Group’s best estimate of the number of equity instruments that will ultimately
vest. The charge or credit to profit or loss for a period represents the movement in the cumulative
expense recognised as at the beginning and end of that period.
Service and non-market performance conditions are not taken into account when determining
the grant date fair value of awards, but the likelihood of the conditions being met is assessed as
part of the Group’s best estimate of the number of equity instruments that will ultimately vest.
Market performance conditions are reflected within the grant date fair value. Any other conditions
attached to an award, but without an associated service requirement, are considered to be
non-vesting conditions. Non-vesting conditions are reflected in the fair value of an award and lead
to an immediate expensing of an award unless there are also service and/or performance
conditions.
For awards that do not ultimately vest because non-market performance and/or service
conditions have not been met, no expense is recognised. Where awards include a market or
non-vesting condition, the transactions are treated as vesting irrespective of whether the market or
non-vesting condition is satisfied, provided that all other performance and/or service conditions are
satisfied.
Where the terms of an equity-settled award are modified, as a minimum an expense is
recognised as if the terms had not been modified, if the original terms of the award are met. In
addition, an expense is recognised for any modification that increases the total fair value of the
share-based payments, or is otherwise beneficial to the employee as measured at the date of
modification. Where an equity-settled award is canceled, it is treated as if it had vested on the date
of cancelation, and any expense not yet recognised for the award is recognised immediately.
The dilutive effect of outstanding options is reflected as additional share dilution in the
computation of earnings per share.
APPENDIX I ACCOUNTANTS’ REPORT
– I-46 –


--- page 506 ---
Other employee benefits
Pension scheme
The employees of the Company and Group’s subsidiaries which operate in Chinese mainland
are required to participate in a central pension scheme operated by the local municipal
government. These subsidiaries are required to contribute a certain proportion of its payroll costs
to the central pension scheme. The contributions are charged to profit or loss as they become
payable in accordance with the rules of the central pension scheme. Other than the monthly
contributions, the Group has no further payment obligations once the contributions have been paid.
Housing fund and other social insurances — Chinese mainland
The Group has participated in defined social security contribution schemes for its employees
pursuant to the relevant laws and regulations of the PRC. These include housing fund, basic
medical insurance, unemployment insurance, injury insurance and maternity insurance. The Group
makes monthly contributions to the housing fund and other social insurances. The contributions are
charged to profit or loss on an accrual basis. The Group’s liability in respect of these funds is
limited to the contributions payable in each of the Relevant Periods.
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of
qualifying assets, i.e., assets that necessarily take a substantial period of time to get ready for their
intended use or sale, are capitalised as part of the cost of those assets. The capitalisation of such
borrowing costs ceases when the assets are substantially ready for their intended use or sale. All
other borrowing costs are expensed in the period in which they are incurred. Borrowing costs
consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
Events after the reporting period
If the Group receives information after the reporting period, but prior to the date of
authorisation for issue, about conditions that existed at the end of the reporting period, it will
assess whether the information affects the amounts that it recognises in its Historical Financial
Information. The Group will adjust the amounts recognised in its Historical Financial Information
to reflect any adjusting events after the reporting period and update the disclosures that relate to
those conditions in light of the new information. For non-adjusting events after the reporting
period, the Group will not change the amounts recognised in its Historical Financial Information,
but will disclose the nature of the non-adjusting events and an estimate of their financial effects,
or a statement that such an estimate cannot be made, if applicable.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 507 ---
Dividends
Final dividends are recognised as a liability when they are approved by the shareholders in a
general meeting. Proposed final dividends are disclosed in the notes to the Historical Financial
Information. Interim dividends are simultaneously proposed and declared, because the Company’s
memorandum and articles of association grant the directors the authority to declare interim
dividends. Consequently, interim dividends are recognised immediately as a liability when they are
proposed and declared.
Foreign currencies
These Historical Financial Information are presented in RMB, which is the Company’s
functional currency. Each entity in the Group determines its own functional currency and items
included in the financial statements of each entity are measured using that functional currency.
Foreign currency transactions recorded by the entities in the Group are initially recorded using
their respective functional currency rates prevailing at the dates of the transactions. Monetary
assets and liabilities denominated in foreign currencies are translated at the functional currency
rates of exchange ruling at the end of each of the Relevant Periods. Differences arising on
settlement or translation of monetary items are recognised in the statement of profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are
translated using the exchange rates at the dates of the initial transactions.
The functional currencies of certain overseas subsidiaries and associates are currencies other
than the RMB. As at the end of each of the Relevant Periods, the assets and liabilities of these
entities are translated into RMB at the exchange rates prevailing at the end of each of the Relevant
Periods and their statements of profit or loss are translated into RMB at the exchange rates that
approximate to those prevailing at the dates of the transactions.
The resulting exchange differences are recognised in other comprehensive income and
accumulated in the exchange fluctuation reserve, except to the extent that the differences are
attributable to non-controlling interests.
For the purpose of the consolidated statement of cash flows, the cash flows of overseas
subsidiaries are translated into RMB at the exchange rates ruling at the dates of the cash flows.
Frequently recurring cash flows of overseas subsidiaries which arise throughout the year are
translated into RMB at the weighted average exchange rates for the year.
APPENDIX I ACCOUNTANTS’ REPORT
– I-48 –


--- page 508 ---
3. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES
The preparation of the Historical Financial Information requires management to make
judgements, estimates and assumptions that affect the reported amounts of revenues, expenses,
assets and liabilities, and their accompanying disclosures, and the disclosure of contingent
liabilities. Uncertainty about these assumptions and estimates could result in outcomes that could
require a material adjustment to the carrying amounts of the assets or liabilities affected in the
future.
Judgements
In the process of applying the Group’s accounting policies, management has made the
following judgements, apart from those involving estimations, which have the most significant
effect on the amounts recognised in the Historical Financial Information:
Development expenses
Expenditure incurred on projects to develop new products is capitalised and deferred only
when the Group can demonstrate the technical feasibility of completing the intangible asset so that
it will be available for use or sale, its intention to complete and its ability to use or sell the asset,
how the asset will generate future economic benefits, the availability of resources to complete the
project and the ability to measure reliably the expenditure during the development. Product
development expenditure which does not meet these criteria is expensed when incurred.
Determining the amounts of development costs to be capitalised requires the use of judgements
and estimation.
Deferred tax assets
Deferred tax assets are recognised in respect of deductible temporary differences and unused
tax losses. As those deferred tax assets can only be recognised to the extent that it is probable that
future taxable profits will be available against which the deductible temporary differences and the
losses can be utilised, management’s judgement is required to assess the probability of future
taxable profits. Management’s assessment is revised as necessary and additional deferred tax assets
are recognised if it becomes probable that future taxable profits will allow the deferred tax asset to
be recovered.
APPENDIX I ACCOUNTANTS’ REPORT
– I-49 –


--- page 509 ---
Estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at
the end of each of the Relevant Periods, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within the next financial year, are
described below.
Impairment of non-financial assets (other than goodwill)
The Group assesses whether there are any indicators of impairment for all non-current assets
other than financial assets at the end of each reporting period. Other non-current assets other than
financial assets are tested for impairment when there are indications that the carrying amounts may
not be recoverable. An impairment exists when the carrying amount of an asset or asset group
exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and the
present value of the future cash flows expected to be derived from it. 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 assets. When the calculations of the present value of the future cash flows expected to be
derived from an asset or asset group are undertaken, management must estimate the expected
future cash flows from the asset or asset group and choose a suitable discount rate in order to
calculate the present value of those cash flows.
Inventory provision determined on net realisable value
According to the inventory accounting policy, the Group measures the inventory at the lower
of cost and net realisable value, and makes inventory provision for the obsolete inventory,
slow-moving inventory and the inventory of which the cost is higher than their net realisable
value. At the end of each of the Relevant Periods, the Group reviews whether individual inventory
items are obsolete or stagnant and whether their net realisable value is lower than their cost. The
impairment of inventory is based on the assessment of the inventory’s merchantability and its net
realisable value. Identification of inventory impairment requires management to make judgements
and estimates based on solid evidence and factors such as the purpose of holding the inventory and
the impact of events after the end of each of the Relevant Periods. The difference between the
actual result and the original estimate will affect the carrying amount of inventories and the
accrual or reversal of inventory provision during the period in which the estimate is changed.
APPENDIX I ACCOUNTANTS’ REPORT
– I-50 –


--- page 510 ---
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. The carrying amounts of goodwill at December 31,
2022, 2023 and 2024 and October 31, 2025 were RMB12,924,000, RMB153,963,000,
RMB74,323,000 and RMB12,924,000, respectively. Further details are given in note 18.
Provision for expected credit losses on trade receivables and contract assets
The Group uses a provision matrix to calculate ECLs for trade receivables and contract
assets. The provision rates are based on invoice date for groupings of various customer segments
that have similar loss patterns.
The provision matrix is initially based on the Group’s historical observed default rates. The
Group will calibrate the matrix to adjust the historical credit loss experience with forward-looking
information. For instance, if forecast economic conditions (i.e., gross domestic product) are
expected to deteriorate over the next year which can lead to an increased number of defaults in the
manufacturing sector, the historical default rates are adjusted. At each reporting date, the historical
observed default rates are updated and changes in the forward-looking estimates are analysed.
The assessment of the correlation among historical observed default rates, forecast economic
conditions and ECLs is a significant estimate. The amount of ECLs is sensitive to changes in
circumstances and forecast economic conditions. The Group’s historical credit loss experience and
forecast of economic conditions may also not be representative of a customer’s actual default in
the future. The information about the ECLs on the Group’s trade receivables and contract assets is
disclosed in note 22 and note 24 to the Historical Financial Information, respectively.
Leases — Estimating the incremental borrowing rate
The Group cannot readily determine the interest rate implicit in a lease, and therefore, it uses
an incremental borrowing rate (“ IBR”) to measure lease liabilities. The IBR is the rate of interest
that the Group would have to pay to borrow over a similar term, and with a similar security, the
funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic
environment. The IBR therefore reflects what the Group “would have to pay”, which requires
estimation when no observable rates are available (such as for subsidiaries that do not enter into
financing transactions) or when it needs to be adjusted to reflect the terms and conditions of the
APPENDIX I ACCOUNTANTS’ REPORT
– I-51 –


--- page 511 ---
lease (for example, when leases are not in the subsidiary’s functional currency). The Group
estimates the IBR using observable inputs (such as market interest rates) when available and is
required to make certain entity-specific estimates (such as the subsidiary’s stand-alone credit
rating).
4. OPERATING SEGMENT INFORMATION
The Group is principally engaged in one single operating segment, i.e., research,
manufacturing and trading of manufacturing equipment of printed circuit board. Management
monitors the operating results of the Group as a whole for the purpose of making decisions about
resource allocation and preformation assessment. Accordingly, no operating segment information is
presented.
Geographical information
(a) Revenue from external customers
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Chinese mainland ..... 2,729,482 1,538,264 2,965,452 2,308,510 3,750,145
Other countries/region . 36,390 84,905 361,920 301,597 552,311
2,765,872 1,623,169 3,327,372 2,610,107 4,302,456
(b) Non-current assets
The geographical information of non-current assets is not presented as more than 90% of the
non-current assets of the Group are located in Chinese mainland.
APPENDIX I ACCOUNTANTS’ REPORT
– I-52 –


--- page 512 ---
Information about major customers
Revenue from the major customers which amounted to 10% or more of the Group’s revenue
is set out below:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Customer A ......... 352,016 N/A* N/A* N/A* N/A*
Customer B ......... 300,770 N/A* N/A* N/A* N/A*
Customer C ......... N/A* N/A* N/A* N/A* 851,306
* The corresponding revenue of the customer is not disclosed as the revenue individually did not account for 10% or
more of the Group’s revenue during the respective period.
5. REVENUE
An analysis of revenue is as follows:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Revenue from contracts
with customers ..... 2,765,872 1,623,169 3,327,372 2,610,107 4,302,456
Revenue from other
sources
Rental income ...... 20,278 11,142 15,719 13,775 11,690
Total .............. 2,786,150 1,634,311 3,343,091 2,623,882 4,314,146
APPENDIX I ACCOUNTANTS’ REPORT
– I-53 –


--- page 513 ---
Revenue from contracts with customers
(a) Disaggregated revenue information
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Types of goods or
services
Drilling equipment .... 1,666,776 818,051 2,100,645 1,619,065 3,095,604
Photolithography
equipment ......... 403,646 189,155 340,306 288,061 247,547
Testing equipment .... 284,312 197,561 274,139 219,857 383,632
Formation equipment .. 214,864 152,323 254,138 200,959 237,581
Attachment equipment . 23,603 54,778 81,940 64,796 95,437
Lamination equipment . — — 9,804 4,760 —
Others ............. 172,671 211,301 266,400 212,609 242,655
Total .............. 2,765,872 1,623,169 3,327,372 2,610,107 4,302,456
Timing of revenue
recognition
Goods transferred at a
point in time ....... 2,683,744 1,531,567 3,204,618 2,511,739 4,172,927
Services transferred
over time ......... 82,128 91,602 122,754 98,368 129,529
Total .............. 2,765,872 1,623,169 3,327,372 2,610,107 4,302,456
APPENDIX I ACCOUNTANTS’ REPORT
– I-54 –


--- page 514 ---
The following table shows the amounts of revenue recognised in the Relevant Periods and the
ten months ended October 31, 2024 that were included in the contract liabilities at the beginning
of the reporting period:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Revenue recognised
that was included in
contract liabilities at
the beginning of
the reporting period: 61,100 25,955 65,754 42,813 38,962
(b) Performance obligations
Information about the Group’s performance obligations is summarised below:
Sale of industrial products
The performance obligation is satisfied upon delivery of the industrial products and
completion of installation and customer acceptance.
Maintenance services
The performance obligation is satisfied over time as services are rendered and payment is
generally due by installments upon completion of maintenance and customer acceptance, except
for certain customers, where payment in advance is normally required.
All the amounts of transaction prices allocated to the remaining performance obligations are
expected to be recognised as revenue within one year. The Group elected to apply the practical
expedient for not to disclose the remaining performance obligations. The amounts disclosed above
do not include variable consideration which is constrained.
APPENDIX I ACCOUNTANTS’ REPORT
– I-55 –


--- page 515 ---
6. OTHER INCOME AND GAINS, NET
An analysis of other income and gains, net, is as follows:
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Other income
Government grants* ............. 139,883 64,471 60,043 47,661 50,680
Bank interest income ............ 40,719 40,832 20,699 17,017 33,312
Additional V AT deduction** ...... — 5,310 48,308 22,910 37,804
Total other income .............. 180,602 110,613 129,050 87,588 121,796
Other gains, net
Foreign exchange differences, net .. 1 , 7 5 3————
Gains/(losses) on disposal of
property, plant and equipment,
right-of-use assets and other
non-current asset .............. 775 207 (84) (261) (303)
Fair value gains on contingent
consideration ................ — — 60,160 — 8,523
Gain on remeasurement of
pre-existing interest in an
associate (note 39) ............ — 15,360 — — —
Gains on derecognition of financial
liabilities measured at amortised
cost ........................ 639 500 930 540 21
Others ....................... 912 1,119 1,957 1,390 1,321
Total other gains ............... 4,079 17,186 62,963 1,669 9,562
Total other income and gains, net ... 184,681 127,799 192,013 89,257 131,358
* Government grants related to income that is received or receivable as compensation for expenses or losses already
incurred or for the purpose of giving immediate financial support to the Group with no future related costs
recognised in profit or loss in the period upon actual receipt and purchases of items of property, plant and
equipment. There are no unfulfilled conditions or contingencies relating to these grants.
** According to the regulations of Ministry of Finance and the State Administration of Taxation, certain entities within
the Group can enjoy an additional 5% or 15% deduction calculated based on the input value-added tax (“ VAT”)
from the V AT payable since January 1, 2023. The amount of additional deduction was recognised in profit or loss
when the entities declared and enjoyed the preferential tax treatment.
APPENDIX I ACCOUNTANTS’ REPORT
– I-56 –


--- page 516 ---
7. PROFIT BEFORE TAX
The Group’s profit before tax is arrived at after charging/(crediting):
Notes Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Cost of inventories sold ...... 1,790,716 1,075,587 2,361,863 1,875,395 2,867,301
Cost of services provided ..... 24,336 34,429 48,068 39,887 72,730
Depreciation of investment
properties ............... 16 77 77 77 65 65
Depreciation of property, plant
and equipment* .......... 15 25,440 28,240 29,330 23,837 35,267
Depreciation of right-of-use
assets* ................ 17(a) 51,907 50,572 44,239 36,425 35,724
Amortisation of other intangible
assets* ................ 19 2,083 2,407 2,612 2,138 2,228
Research and development costs . 229,671 193,564 266,829 200,660 299,957
Impairment of goodwill # ...... 18 — — 79,640 — 61,399
Expense relating to short-term
leases and leases of low-value
assets ................. 17(c) 20,517 15,585 18,075 15,724 23,428
Auditor’s remuneration ....... 600 600 700 143 817
Listing expense ............ ———— 1,143
Employee benefit expense
(excluding directors’ and
supervisors’ remuneration
(note 10) ):
Wages and salaries ........ 439,605 305,949 402,476 311,953 512,524
Pension scheme contributions . 28,943 30,554 37,178 29,564 42,460
Equity-settled share based
payment expense ........ (8,177) 9,552 113,863 95,519 61,197
Foreign exchange differences,
net ................... (1,753) 7,053 2,345 4,610 34,092
Impairment of an investment in
an associate ............. 55,768 ————
Impairment of financial and
contract assets:
Impairment of trade and bills
receivables ............ 22,634 16,282 22,243 28,194 23,755
(Reversal of)/provision for
impairment of contract
assets ................ (477) (263) 153 505 335
Impairment of financial assets
included in prepayments,
other receivables and other
assets ................ 623 1,378 959 876 2,119
22,780 17,397 23,355 29,575 26,209
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 517 ---
Notes Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Write-down of inventories to net
realisable value ........... 23,280 47,409 25,490 20,352 31,259
Product warranty provision .... 26,998 13,082 33,553 30,833 31,401
Gains on derecognition of
financial liabilities measured
at amortised cost .......... (639) (500) (930) (540) (21)
Bank interest income ........ (40,719) (40,832) (20,699) (17,017) (33,312)
(Gains)/losses on disposal of
property, plant and equipment,
right-of-use assets and other
non-current asset .......... (775) (207) 84 261 303
* The depreciation of property, plant and equipment, depreciation of right-of-use assets and amortisation of other
intangible assets for the Relevant Periods and the ten months ended October 31, 2024 are included in “Cost of
sales”, “Administrative expenses”, “Selling and marketing expenses” and “Research and development expenses” in
the consolidated statements of profit or loss.
# The impairment of goodwill included in “Other expenses” in the consolidated statement of profit or loss.
8. FINANCE COSTS
An analysis of finance costs is as follows:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Interest on loans ...... 8,367 382 3,882 3,618 8,501
Interest expense on
discounted bills ..... 2,199 1,467 3,138 2,964 3,436
Interest on lease
liabilities ......... 6,410 4,789 3,041 2,506 1,533
Total .............. 16,976 6,638 10,061 9,088 13,470
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 518 ---
9. OTHER EXPENSES
An analysis of other expenses is as follows:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Foreign exchange
differences, net ..... — 7,053 2,345 4,610 34,092
Donations ........... 3,000 — 55 50 —
Impairment of
goodwill .......... — — 79,640 — 61,399
Compensation ........ 191 2,665 134 134 279
Others ............. 786 903 1,001 663 239
Total .............. 3,977 10,621 83,175 5,457 96,009
10. DIRECTORS’ AND SUPERVISORS’ REMUNERATION
Directors’ and supervisors’ remuneration for the Relevant Periods and the ten months ended
October 31, 2024 is as follows:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Fees ............... 360 360 350 290 300
Other emoluments:
Salaries, allowances
and benefits in
kind ........... 1,526 2,168 2,301 1,749 2,077
Performance related
bonuses ......... 990 81 555 — —
Share-based payment
compensation .... (2,083) 3,184 38,208 31,840 20,895
Pension scheme
contributions ..... 149 153 153 127 139
Total .............. 942 5,946 41,567 34,006 23,411
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 519 ---
During the Relevant Periods and the ten months ended October 31, 2024, certain directors
were granted share options, in respect of their services to the Group, under the share option
scheme of the Company, further details of which are set out in note 36 to the Historical Financial
Information. The fair value of such options, which has been recognised in the statement of profit
or loss over the vesting period, was determined as at the date of grant and the amount included in
the Historical Financial Information for the current year is included in the above directors’ and
supervisors’ remuneration disclosures.
(a) Independent non-executive directors
The fees paid to independent non-executive directors during the Relevant Periods and the ten
months ended October 31, 2024 were as follows:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Mr. Qiu Yunliang ..... 120 120 120 100 100
Ms. Wu Yanni (i) ..... 1 2 0 1 2 0———
Mr. Chen Changsheng
(iii) .............. 120 120 40 40 —
Ms. Li Weiwei (ii) .... — — 110 90 100
Mr. Xin Guosheng (iv) . — — 80 60 100
Total .............. 360 360 350 290 300
(i) Ms. Wu Yanni resigned as an independent non-executive director of the Company on February 2, 2024. Ms. Wu
Yanni has waived the remuneration of director for January 2024.
(ii) Ms. Li Weiwei was appointed as an independent non-executive director of the Company with effect from February
2, 2024.
(iii) Mr. Chen Changsheng resigned as an independent non-executive director of the Company on May 6, 2024.
(iv) Mr. Xin Guosheng was appointed as an independent non-executive director of the Company with effect from May
6, 2024.
There were no other emoluments payable to the independent non-executive directors during
the Relevant Periods and the ten months ended October 31, 2024.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 520 ---
(b) Executive directors and supervisors
Year ended December 31, 2022
Fees
Salaries,
allowances
and benefits
in kind
Performance
related
bonuses
Share-based
payment
compensation
Pension
scheme
contributions
Total
remuneration
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors
Mr. Yang Chaohui (i) ........... — 1,147 900 (2,001) 96 142
Non-executive directors
Mr. Zhang Jianqun (ii) ........... ——————
Mr. Zhou Huiqiang (iii) .......... ——————
Mr. Du Yonggang (iv) ........... ——————
Subtotal ................... ——————
Supervisors
Mr. Hu Zhixiong (v) ............ ——————
Mr. Hu Zhiyi (vi) .............. ——————
Ms. Huang Linting (vii) .......... — 379 90 (82) 53 440
Subtotal ................... — 379 90 (82) 53 440
Total ..................... — 1,526 990 (2,083) 149 582
APPENDIX I ACCOUNTANTS’ REPORT
– I-61 –


--- page 521 ---
Year ended December 31, 2023
Fees
Salaries,
allowances
and benefits
in kind
Performance
related
bonuses
Share-based
payment
compensation
Pension
scheme
contributions
Total
remuneration
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors
Mr. Yang Chaohui (i) ........... — 1,790 — 3,184 101 5,075
Non-executive directors
Mr. Zhang Jianqun (ii) ........... ——————
Mr. Zhou Huiqiang (iii) .......... ——————
Mr. Du Yonggang (iv) ........... ——————
Subtotal ................... ——————
Supervisors
Mr. Hu Zhixiong (v) ............ ——————
Mr. Hu Zhiyi (vi) .............. ——————
Ms. Huang Linting (vii) .......... — 378 81 — 52 511
Mr. Liu Tao (viii) .............. ——————
Subtotal ................... — 378 81 — 52 511
Total ..................... — 2,168 81 3,184 153 5,586
APPENDIX I ACCOUNTANTS’ REPORT
– I-62 –


--- page 522 ---
Year ended December 31, 2024
Fees
Salaries,
allowances
and benefits
in kind
Performance
related
bonuses
Share-based
payment
compensation
Pension
scheme
contributions
Total
remuneration
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors
Mr. Yang Chaohui (i) ........... — 1,903 411 38,208 101 40,623
Non-executive directors
Mr. Zhang Jianqun (ii) ........... ——————
Mr. Zhou Huiqiang (iii) .......... ——————
Mr. Du Yonggang (iv) ........... ——————
Subtotal ................... ——————
Supervisors
Mr. Hu Zhixiong (v) ............ ——————
Mr. Hu Zhiyi (vi) .............. ——————
Ms. Huang Linting (vii) .......... — 398 144 — 52 594
Mr. Liu Tao (viii) .............. ——————
Subtotal ................... — 398 144 — 52 594
Total ..................... — 2,301 555 38,208 153 41,217
APPENDIX I ACCOUNTANTS’ REPORT
– I-63 –


--- page 523 ---
Ten months ended October 31, 2024 (unaudited)
Fees
Salaries,
allowances
and benefits
in kind
Performance
related
bonuses
Share-based
payment
compensation
Pension
scheme
contributions
Total
remuneration
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Executive directors
Mr. Yang Chaohui (i) ........... — 1,423 — 31,840 84 33,347
Non-executive directors
Mr. Zhang Jianqun (ii) ........... ——————
Mr. Zhou Huiqiang (iii) .......... ——————
Mr. Du Yonggang (iv) ........... ——————
Subtotal ................... ——————
Supervisors
Mr. Hu Zhixiong (v) ........... ——————
Mr. Hu Zhiyi (vi) .............. ——————
Ms. Huang Linting (vii) .......... — 326 — — 43 369
Mr. Liu Tao (viii) .............. ——————
Subtotal ................... — 326 — — 43 369
Total ..................... — 1,749 — 31,840 127 33,716
APPENDIX I ACCOUNTANTS’ REPORT
– I-64 –


--- page 524 ---
Ten months ended October 31, 2025
Fees
Salaries,
allowances
and benefits
in kind
Performance
related
bonuses
Share-based
payment
compensation
Pension
scheme
contributions
Total
remuneration
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors
Mr. Yang Chaohui (i) ........... — 1,716 — 20,895 91 22,702
Non-executive directors
Mr. Zhang Jianqun (ii) ........... ——————
Mr. Zhou Huiqiang (iii) .......... ——————
Mr. Du Yonggang (iv) ........... ——————
Ms. Huang Linting (vii) .......... — 361 — — 48 409
Subtotal ................... — 361 — — 48 409
Supervisors
Mr. Hu Zhixiong (v) ........... ——————
Mr. Hu Zhiyi (vi) .............. ——————
Ms. Huang Linting (vii) .......... ——————
Mr. Liu Tao (viii) .............. ——————
Mr. Yuan Yangbo (ix) ........... ——————
Subtotal ................... ——————
Total ..................... — 2,077 — 20,895 139 23,111
(i) Mr. Yang Chaohui was appointed as an executive director of the Company with effect from November 6, 2020. Mr.
Yang Chaohui was also serving as the chief executive officer of the Company since May 2003.
(ii) Mr. Zhang Jianqun was appointed as an executive director of the Company with effect from November 6, 2020.
(iii) Mr. Zhou Huiqiang was appointed as an executive director of the Company with effect from November 6, 2020.
(iv) Mr. Du Yonggang was appointed as an executive director of the Company with effect from November 6, 2020.
(v) Mr. Hu Zhixiong was appointed as a supervisor of the Company with effect from November 6, 2020 and resigned
on November 8, 2023.
(vi) Mr. Hu Zhiyi was appointed as a supervisor of the Company with effect from March 20, 2021 and retired on
January 15, 2025.
(vii) Ms. Huang Linting was appointed as a supervisor of the Company with effect from November 6, 2020 and retired
on May 12, 2025. Ms. Huang Linting was appointed as a non-executive director (employee director) of the
Company with effect from May 14, 2025.
APPENDIX I ACCOUNTANTS’ REPORT
– I-65 –


--- page 525 ---
(viii) Mr. Liu Tao was appointed as a supervisor of the Company with effect from November 8, 2023 and retired on May
12, 2025.
(ix) Mr. Yuan Yangbo was appointed as a supervisor of the Company with effect from January 15, 2025. and retired on
May 12, 2025.
No emoluments were paid by the Company to the directors and supervisors as an inducement
to join or upon joining the Company or as compensation for loss of office during the Relevant
Periods and the ten months ended October 31, 2024. No compensation was paid to, or receivable
by, any Director, former director or any of the five highest-paid individuals for the loss of any
other office in connection with the management of the affairs of any member of our Group.
11. FIVE HIGHEST PAID EMPLOYEES
The five highest paid employees during the years ended December 31, 2022, 2023 and 2024
and the ten months ended October 31, 2024 and 2025 included one, one, one, one and one
directors of the Company, respectively, details of whose remuneration are set out in note 10 to the
Historical Financial Information above. Details of the remuneration for the remaining highest paid
employees during the Relevant Periods and the ten months ended October 31, 2024 are as follows:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Salaries, allowances
and benefits in kind . 4,307 4,282 3,326 3,081 3,062
Performance related
bonuses ........... 3,225 2,061 2,360 — —
Share-based payment
compensation ...... 163 932 12,781 10,651 6,990
Pension scheme
contributions ....... (513) 243 210 175 184
Total .............. 7,182 7,518 18,677 13,907 10,236
APPENDIX I ACCOUNTANTS’ REPORT
– I-66 –


--- page 526 ---
The number of non-director and non-chief executive highest paid employees whose
remuneration fell within the following bands is as follows:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
HK$1,500,001 to
HK$2,000,000 ...... 2 3———
HK$2,000,001 to
HK$2,500,000 ...... 2——— 3
HK$2,500,001 to
HK$3,000,000 ...... — 1———
HK$3,000,001 to
HK$4,500,000 ...... — — —41
HK$4,500,001 to
HK$5,000,000 ...... —— 2——
HK$5,000,001 to
HK$5,500,000 ...... —— 1——
HK$5,500,001 to
HK$6,000,000 ..... —— 1——
Total .............. 44444
During the Relevant Periods and the ten months ended October 31, 2024, share options were
granted to four non-director and non-chief executive highest paid employee in respect of their
services to the Group, further details of which are included in the disclosures in note 36 to the
Historical Financial Information. The fair value of such options, which has been recognised in the
statement of profit or loss over the vesting period, was determined as at the date of grant and the
amount included in the Historical Financial Information during the Relevant Periods and the ten
months ended October 31, 2024 is included in the above non-director and non-chief executive
highest paid employees’ remuneration disclosures.
APPENDIX I ACCOUNTANTS’ REPORT
– I-67 –


--- page 527 ---
12. INCOME TAX
The Group is subject to income tax on an entity basis on profits arising in or derived from
the jurisdictions in which members of the Group are domiciled and operate.
Chinese mainland
Under the Law of the PRC on Enterprise Income Tax (the “ EIT Law ”) and Implementation
Regulation of the EIT Law, the EIT rate of the PRC subsidiaries is 25% during the Relevant
Periods and the ten months ended October 31, 2024 unless subject to tax concession set out below.
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 and became effective on January 1, 2016, an
enterprise recognised 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. The
Company, Shenzhen Mason Electronics Co., Ltd. and Advanced Intelligent Machine Co., Ltd. are
subject to a preferential income tax rate of 15% from 2022 to 2025. Shenzhen Han’s Rayleigh
Taide Precision Coating Co., Ltd. was subject to a preferential income tax rate of 15% from 2024
to 2026.
Pursuant to the Circular of Extending the Period of Western Development Strategies
Preferential Tax Rate (circular of the Ministry of Finance, State Taxation Administration and
National Development and Reform Commission [2020] No. 23), from January 1, 2021 to
December 31, 2030, enterprises located in western China that are engaged in encouraged industries
shall be subject to a reduced enterprise income tax at a tax rate of 15%. The enterprises in the
encouraged industries shall mainly engage in the industries set out in the Catalog of Encouraged
Industries in Western China, and the revenue from the main business of such enterprises shall
exceed 60% of the total revenue. Han’s CNC Technology (Xinfeng) Co., Ltd. operated in western
China are subject to a preferential income tax rate of 15% from 2022 to 2025. Mason Electronics
(Xinfeng) Co., Ltd. was subject to a preferential income tax rate of 15% from 2024 to 2025.
Pursuant to the Corporate Income Tax Law of the People’s Republic of China and its
Implementation Regulations, for the period from January 1, 2021 to December 31, 2022, small and
low-profit enterprises were subject to a reduced effective corporate income tax rate of 2.5% on the
portion of their annual taxable income not exceeding RMB1,000,000; effective January 1, 2023
through December 31, 2027, this reduced rate on taxable income up to RMB1,000,000 is 5%;
concurrently, for the period spanning January 1, 2022 to December 31, 2027, the portion of annual
taxable income between RMB1,000,000 and RMB3,000,000 (inclusive) for such enterprises is
subject to corporate income tax at a reduced effective rate of 5%. Suzhou Mason Electronics
APPENDIX I ACCOUNTANTS’ REPORT
– I-68 –


--- page 528 ---
Testing Co., Ltd., Shenzhen Han’s Rayleigh Taide Precision Coating Co., Ltd., Dongguan Han’s
CNC Technology Co., Ltd., Shenzhen Han’s Microelectronics Technology Co., Ltd. and Shanghai
Han’s Machinery Co., Ltd., meet the criteria for small and low-profit enterprises and thus enjoy
the aforementioned corporate income tax incentives.
Additional deduction for research and development expense
Additional deductible allowance was for qualified research and development costs. According
to the relevant laws and regulations promulgated by the State Taxation Administration of the PRC
enterprises engaging in research and development activities are entitled to claim 200% of their
research and development costs so incurred as tax deductible expenses when determining their
assessable profits during the Relevant Periods and the ten months ended October 31, 2024.
Pursuant to the Corporate Income Tax Law of the People’s Republic of China and its
Implementation Regulations, qualified industrial machine tool enterprises are eligible for the new
R&D super deduction. An extra 120% of the amount of R&D actually incurred during the period
from January 1, 2023 to December 31, 2027 is deductible before tax payment, in addition to the
deduction of actual expenses as prescribed, provided that the said expenses are not recognized as
intangible asset and included in the current profits and losses; if the said expenses have been
recognized as an intangible asset, such expenses may be amortized at the rate of 220% of the costs
of the intangible assets before tax payment in the above period. The Company, Shenzhen Mason
Electronics Co., Ltd. and Advanced Intelligent Machine Co., Ltd. benefited from this tax incentive
in 2023, 2024 and 2025.
Hong Kong
Pursuant to the Inland Revenue (Amendment) (No. 3) Ordinance 2018, the two-tiered profits
tax rates regime will be applicable to any year of assessment commencing on or after April 1,
2018. Under the two-tiered profits tax rates regime, the first HK$2 million of profits of the
qualifying group entity are taxed at 8.25%, and profits above HK$2 million are taxed at 16.5%.
The subsidiaries incorporated in Hong Kong is subject to Hong Kong profits tax at the rate of
16.5% on the estimated assessable profits arising in Hong Kong.
Thailand and Singapore
No provision for profits tax in Thailand and Singapore was made as the Group did not have
any assessable income subject to profits tax in Thailand and Singapore during the Relevant Periods
and the ten months ended October 31, 2024.
APPENDIX I ACCOUNTANTS’ REPORT
– I-69 –


--- page 529 ---
The income tax expense of the Group for the Relevant Periods and the ten months ended
October 31, 2024 is analysed as follows:
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Current income tax .............. 65,817 9,181 12,878 14,646 110,167
Deferred income tax ............. (14,507) (7,423) 17,123 (4,537) (39,170)
Total ........................ 51,310 1,758 30,001 10,109 70,997
A reconciliation of the tax expense applicable to profit before tax at the applicable rate to the
tax expense at the effective tax rate is as follows:
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Profit before tax ................ 483,322 137,426 329,583 222,084 589,916
Tax at the applicable tax rate ...... 72,529 22,873 51,333 35,468 93,064
Adjustments in respect of current
tax of previous periods ......... 10 2,595 (14) (14) —
Income not subject to tax ......... (106) (91) (1,988) (1,007) (836)
Expenses not deductible for tax .... 3,213 862 16,423 3,532 14,023
Additional deductible allowance for
research and development
expenses .................... (29,570) (33,046) (37,173) (26,256) (37,757)
Tax losses and deductible temporary
differences utilised from previous
periods .................... — (67) (2,088) (2,302) (4,411)
Tax losses and deductible temporary
differences not recognised ...... 5,234 8,677 3,388 688 6,914
Effect on deferred tax balances due
to change in income tax rate ..... — (45) 120 — —
Tax charge at the Group’s effective
tax rate ..................... 51,310 1,758 30,001 10,109 70,997
APPENDIX I ACCOUNTANTS’ REPORT
– I-70 –


--- page 530 ---
13. DIVIDEND
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Dividends in respect of
the previous
year/period, declared
or paid during the
year/period (tax
inclusive) ......... 168,000 1,197,000 — — 168,000
The final dividends of RMB0.40, RMB2.00, nil and RMB0.40 (inclusive of tax) for each
ordinary share in respect of the years ended December 31, 2021, 2022, 2023 and 2024 were
approved by the Annual General Meeting of the Company.
The dividends of RMB0.85 (inclusive of tax) for each ordinary share in respect of the nine
months ended September 30, 2023 were approved by the Extraordinary General Meeting of the
Company on November 8, 2023.
14. EARNINGS PER SHARE ATTRIBUTABLE TO ORDINARY EQUITY HOLDERS OF
THE PARENT
The calculation of the basic earnings per share amounts is based on the profit for the
Relevant Periods and the ten months ended October 31, 2024 attributable to ordinary equity
holders of the parent, and the weighted average number of share capital outstanding during the
Relevant Periods and the ten months ended October 31, 2024.
The share option granted by the Company have potential dilutive effect on the earnings per
share. The calculation of the diluted earnings per share amounts is based on the profit for the
Relevant Periods and the ten months ended October 31, 2024 attributable to ordinary equity
holders of the parent. The weighted average number of ordinary shares used in the calculation is
the number of ordinary shares in outstanding during the Relevant Periods and the ten months
ended October 31, 2024, as used in the basic earnings per share calculation, and the weighted
average number of ordinary shares assumed to have been issued at no consideration on the deemed
exercise or conversion of all dilutive potential ordinary shares into ordinary shares.
APPENDIX I ACCOUNTANTS’ REPORT
– I-71 –


--- page 531 ---
The calculation of basic and diluted earnings per share are based on:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Earnings
Profit attributable to
ordinary equity
holders of the parent,
used in the basic
earnings per share
calculation ........ 434,687 135,546 301,180 212,262 523,089
Shares
Weighted average
number of ordinary
shares outstanding
during the
year/period, used in
the basic earnings
per share calculation
(’000) ............ 413,000 420,000 420,000 420,000 422,954
Effect of dilution —
weighted average
number of ordinary
shares (’000):
Share option ....... — — 1,748 1,732 6,524
Weighted average
number of ordinary
shares used in the
diluted earnings per
share calculation
(’000) ............ 413,000 420,000 421,748 421,732 429,478
APPENDIX I ACCOUNTANTS’ REPORT
– I-72 –


--- page 532 ---
15. PROPERTY, PLANT AND EQUIPMENT
The Group
Machinery
Motor
vehicles
Electronic
equipment
Other
equipment
Leasehold
improvements
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at December 31, 2022
As at January 2022:
Cost .................... 53,087 3,245 10,152 34,841 60,307 833 162,465
Accumulated depreciation ....... (23,367) (1,809) (3,727) (19,737) (9,354) — (57,994)
Net carrying amount .......... 29,720 1,436 6,425 15,104 50,953 833 104,471
At January 1, 2022, net of
accumulated depreciation ...... 29,720 1,436 6,425 15,104 50,953 833 104,471
Additions ................. 1,107 1,879 2,823 14,808 1,486 58,062 80,165
Disposals ................. (212) — (34) (121) — — (367)
Depreciation provided during the
year ................... (5,486) (641) (1,884) (5,383) (12,046) — (25,440)
Transfer from inventories ....... 13,868 — 170 487 — — 14,525
Exchange realignment ......... ——— 1—— 1
At December 31, 2022, net of
accumulated depreciation ...... 38,997 2,674 7,500 24,896 40,393 58,895 173,355
As at December 31, 2022
Cost .................... 67,515 5,124 12,820 48,093 61,793 58,895 254,240
Accumulated depreciation ....... (28,518) (2,450) (5,320) (23,197) (21,400) — (80,885)
Net carrying amount .......... 38,997 2,674 7,500 24,896 40,393 58,895 173,355
APPENDIX I ACCOUNTANTS’ REPORT
– I-73 –


--- page 533 ---
Machinery
Motor
vehicles
Electronic
equipment
Other
equipment
Leasehold
improvements
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at December 31, 2023
As at January 1, 2023:
Cost .................... 67,515 5,124 12,820 48,093 61,793 58,895 254,240
Accumulated depreciation ....... (28,518) (2,450) (5,320) (23,197) (21,400) — (80,885)
Net carrying amount .......... 38,997 2,674 7,500 24,896 40,393 58,895 173,355
At January 1, 2023, net of
accumulated depreciation ...... 38,997 2,674 7,500 24,896 40,393 58,895 173,355
Additions ................. 13 — 969 3,407 1,005 255,779 261,173
Acquisition of a subsidiary
(note 39) ................ 4,735 639 25 170 — — 5,569
Disposals ................. (905) — (27) (36) — — (968)
Depreciation provided during the
year ................... (6,390) (740) (2,085) (6,632) (12,393) — (28,240)
Transfers ................. ———— 5 9 1 (591) —
Transfer from inventories ....... 5,007 — 19 1,512 — — 6,538
Transfer to inventories ......... (2,049) ————— (2,049)
Exchange realignment ........ —— 1——— 1
At December 31, 2023, net of
accumulated depreciation ...... 39,408 2,573 6,402 23,317 29,596 314,083 415,379
As at December 31, 2023
Cost .................... 71,393 5,914 13,485 52,453 62,976 314,083 520,304
Accumulated depreciation ....... (31,985) (3,341) (7,083) (29,136) (33,380) — (104,925)
Net carrying amount .......... 39,408 2,573 6,402 23,317 29,596 314,083 415,379
APPENDIX I ACCOUNTANTS’ REPORT
– I-74 –


--- page 534 ---
Machinery
Motor
vehicles
Electronic
equipment
Other
equipment
Leasehold
improvements
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at December 31, 2024
As at January 1, 2024:
Cost .................... 71,393 5,914 13,485 52,453 62,976 314,083 520,304
Accumulated depreciation ....... (31,985) (3,341) (7,083) (29,136) (33,380) — (104,925)
Net carrying amount .......... 39,408 2,573 6,402 23,317 29,596 314,083 415,379
At January 1, 2024, net of
accumulated depreciation ...... 39,408 2,573 6,402 23,317 29,596 314,083 415,379
Additions ................. 1,073 680 3,222 6,645 962 242,706 255,288
Disposals ................. (338) (14) (57) (48) — — (457)
Depreciation provided during the
year ................... (6,426) (813) (2,271) (7,053) (12,767) — (29,330)
Transfers ................. ———— 1 4 7 (147) —
Transfer from inventories ....... 36,116 — 193 615 — — 36,924
At December 31, 2024, net of
accumulated depreciation ...... 69,833 2,426 7,489 23,476 17,938 556,642 677,804
As at December 31, 2024
Cost .................... 105,238 6,209 16,347 58,759 63,591 556,642 806,786
Accumulated depreciation ....... (35,405) (3,783) (8,858) (35,283) (45,653) — (128,982)
Net carrying amount .......... 69,833 2,426 7,489 23,476 17,938 556,642 677,804
APPENDIX I ACCOUNTANTS’ REPORT
– I-75 –


--- page 535 ---
Buildings Machinery
Motor
vehicles
Electronic
equipment
Other
equipment
Leasehold
improvements
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at October 31, 2025 ......
As at January 1, 2025:
Cost ................ — 105,238 6,209 16,347 58,759 63,591 556,642 806,786
Accumulated depreciation ..... — (35,405) (3,783) (8,858) (35,283) (45,653) — (128,982)
Net carrying amount ........ — 69,833 2,426 7,489 23,476 17,938 556,642 677,804
At January 1, 2025, net of
accumulated depreciation .... — 69,833 2,426 7,489 23,476 17,938 556,642 677,804
Additions ............. — 3,356 300 14,722 8,167 — 86,555 113,100
Disposals ............. — (1,049) — (80) (25) (3) — (1,157)
Depreciation provided during the
period .............. (4,327) (10,408) (667) (2,578) (6,674) (10,613) — (35,267)
Transfers ............. 582,278 ————— (582,278) —
Transfer to inventories ....... ———— (37) — — (37)
Transfer from inventories ..... — 10,261 — 438 326 — — 11,025
At October 31, 2025, net of
accumulated depreciation .... 577,951 71,993 2,059 19,991 25,233 7,322 60,919 765,468
As at October 31, 2025
Cost ................ 582,278 109,279 6,509 30,996 66,923 63,588 60,919 920,492
Accumulated depreciation .... (4,327) (37,286) (4,450) (11,005) (41,690) (56,266) — (155,024)
Net carrying amount ....... 577,951 71,993 2,059 19,991 25,233 7,322 60,919 765,468
APPENDIX I ACCOUNTANTS’ REPORT
– I-76 –


--- page 536 ---
The Company
Machinery
Motor
vehicles
Electronic
equipment
Other
equipment
Leasehold
improvements
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at December 31, 2022
As at January 1, 2022:
Cost .................... 18,309 2,612 7,001 29,859 42,958 — 100,739
Accumulated depreciation ....... (6,942) (1,784) (1,902) (16,830) (7,040) — (34,498)
Net carrying amount .......... 11,367 828 5,099 13,029 35,918 — 66,241
At January 1, 2022, net of
accumulated depreciation ...... 11,367 828 5,099 13,029 35,918 — 66,241
Additions ................. — 1,879 2,351 13,281 1,210 591 19,312
Disposals ................. (202) — (15) (120) — — (337)
Depreciation provided during the
year ................... (2,022) (580) (1,511) (4,735) (8,557) — (17,405)
Transfer from inventories ....... 12,010 — 134 345 — — 12,489
At December 31, 2022, net of
accumulated depreciation ...... 21,153 2,127 6,058 21,800 28,571 591 80,300
As at December 31, 2022
Cost .................... 29,832 4,491 9,285 41,495 44,168 591 129,862
Accumulated depreciation ....... (8,679) (2,364) (3,227) (19,695) (15,597) — (49,562)
Net carrying amount .......... 21,153 2,127 6,058 21,800 28,571 591 80,300
APPENDIX I ACCOUNTANTS’ REPORT
– I-77 –


--- page 537 ---
Machinery
Motor
vehicles
Electronic
equipment
Other
equipment
Leasehold
improvements
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at December 31, 2023
As at January 1, 2023:
Cost .................... 29,832 4,491 9,285 41,495 44,168 591 129,862
Accumulated depreciation ....... (8,679) (2,364) (3,227) (19,695) (15,597) — (49,562)
Net carrying amount .......... 21,153 2,127 6,058 21,800 28,571 591 80,300
At January 1, 2023, net of
accumulated depreciation ...... 21,153 2,127 6,058 21,800 28,571 591 80,300
Additions ................. — — 540 3,060 143 — 3,743
Disposals ................. (167) — (189) (1,350) — — (1,706)
Depreciation provided during the
year ................... (2,977) (562) (1,642) (5,656) (8,468) — (19,305)
Transfers ................. ———— 5 9 1 (591) —
Transfer from inventories ....... 3,595 ————— 3,595
Transfer to inventories ......... (2,049) ————— (2,049)
At December 31, 2023, net of
accumulated depreciation ...... 19,555 1,565 4,767 17,854 20,837 — 64,578
As at December 31, 2023
Cost .................... 30,412 4,491 9,392 40,910 44,902 — 130,107
Accumulated depreciation ....... (10,857) (2,926) (4,625) (23,056) (24,065) — (65,529)
Net carrying amount .......... 19,555 1,565 4,767 17,854 20,837 — 64,578
APPENDIX I ACCOUNTANTS’ REPORT
– I-78 –


--- page 538 ---
Machinery
Motor
vehicles
Electronic
equipment
Other
equipment
Leasehold
improvements
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at December 31, 2024
As at January 1, 2024:
Cost .................... 30,412 4,491 9,392 40,910 44,902 — 130,107
Accumulated depreciation ....... (10,857) (2,926) (4,625) (23,056) (24,065) — (65,529)
Net carrying amount .......... 19,555 1,565 4,767 17,854 20,837 — 64,578
At January 1, 2024, net of
accumulated depreciation ...... 19,555 1,565 4,767 17,854 20,837 — 64,578
Additions ................. — 663 2,908 5,920 395 — 9,886
Disposals ................. (162) (15) (99) (46) — — (322)
Depreciation provided during the
year ................... (3,031) (533) (1,712) (5,647) (8,470) — (19,393)
Transfer from inventories ....... 34,460 — 169 205 — — 34,834
At December 31, 2024, net of
accumulated depreciation ...... 50,822 1,680 6,033 18,286 12,762 — 89,583
As at December 31, 2024
Cost .................... 63,808 4,787 12,200 46,348 45,297 — 172,440
Accumulated depreciation ....... (12,986) (3,107) (6,167) (28,062) (32,535) — (82,857)
Net carrying amount .......... 50,822 1,680 6,033 18,286 12,762 — 89,583
APPENDIX I ACCOUNTANTS’ REPORT
– I-79 –


--- page 539 ---
Machinery
Motor
vehicles
Electronic
equipment
Other
equipment
Leasehold
improvements
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at October 31, 2025
As at January 1, 2025:
Cost ................... 63,808 4,787 12,200 46,348 45,297 — 172,440
Accumulated depreciation ....... (12,986) (3,107) (6,167) (28,062) (32,535) — (82,857)
Net carrying amount .......... 50,822 1,680 6,033 18,286 12,762 — 89,583
At January 1, 2025, net of
accumulated depreciation ..... 50,822 1,680 6,033 18,286 12,762 — 89,583
Additions ................ 384 300 14,195 4,930 — — 19,809
Disposals ................. (8) — (122) (30) — — (160)
Depreciation provided during the
period ................. (5,364) (495) (4,028) (5,465) (7,484) — (22,836)
Transfer from inventories ....... 8,919 — 25 6——— 9,175
At October 31, 2025, net of
accumulated depreciation ..... 54,753 1,485 16,334 17,721 5,278 — 95,571
As at October 31, 2025
Cost .................... 73,102 5,087 26,313 51,096 45,297 — 200,895
Accumulated depreciation ...... (18,349) (3,602) (9,979) (33,375) (40,019) — (105,324)
Net carrying amount ......... 54,753 1,485 16,334 17,721 5,278 — 95,571
At the end of each of the Relevant Periods, no property, plant and equipment of the Group
and the Company was pledged.
APPENDIX I ACCOUNTANTS’ REPORT
– I-80 –


--- page 540 ---
16. INVESTMENT PROPERTIES
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
At the beginning of the year/period
Cost .......................... 3,219 3,219 3,219 3,219
Accumulated depreciation .......... (1,185) (1,262) (1,339) (1,416)
Net carrying amount .............. 2,034 1,957 1,880 1,803
At the beginning of the year/period,
net of accumulated depreciation .... 2,034 1,957 1,880 1,803
Depreciation provided during the
year/period .................... (77) (77) (77) (65)
At the end of the year/period, net of
accumulated depreciation ......... 1,957 1,880 1,803 1,738
At the end of the year/period
Cost .......................... 3,219 3,219 3,219 3,219
Accumulated depreciation .......... (1,262) (1,339) (1,416) (1,481)
Net carrying amount .............. 1,957 1,880 1,803 1,738
The Group’s investment properties consist of a residential property in the Chinese mainland.
The directors of the Company have determined that the investment properties are commercial
based on the nature, characteristics and risks of the properties. As at December 31, 2022, 2023 and
2024 and October 31, 2025, the fair values of the investment properties of the Group are not
materially different from their original cost.
The investment properties are leased to third parties under operating leases, further summary
details of which are included in note 17 to the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-81 –


--- page 541 ---
17. LEASES
The Group as a lessee
During the Relevant Periods, the Group entered into certain long-term lease contracts for
buildings which generally have lease terms between two and ten years. Generally, the Group is
restricted from assigning and subleasing the leased assets outside the Group.
(a) Right-of-use assets
The carrying amounts of the Group’s right-of-use assets and the movements during the
Relevant Periods are as follows:
The Group
Land use rights Buildings Total
RMB’000 RMB’000 RMB’000
As at January 1, 2022 ................. 412,050 129,659 541,709
Additions .......................... 65,311 42,178 107,489
Termination ......................... — (6,571) (6,571)
Depreciation provided during the year ..... (9,673) (42,234) (51,907)
As at December 31, 2022 and January 1,
2023 ............................ 467,688 123,032 590,720
Additions .......................... 1,959 8,077 10,036
Acquisition of a subsidiary (note 39) ..... — 174 174
Termination ......................... — (15,810) (15,810)
Depreciation provided during the year ..... (9,751) (40,821) (50,572)
As at December 31, 2023 and January 1,
2024 ............................ 459,896 74,652 534,548
Additions .......................... — 4,923 4,923
Termination ......................... — (1,654) (1,654)
Depreciation provided during the year ..... (9,712) (34,527) (44,239)
As at December 31, 2024 and January 1,
2025 ............................ 450,184 43,394 493,578
Additions .......................... 208 17,763 17,971
Termination ......................... — (835) (835)
Depreciation provided during the period ... (7,614) (28,110) (35,724)
As at October 31, 2025 ................ 442,778 32,212 474,990
APPENDIX I ACCOUNTANTS’ REPORT
– I-82 –


--- page 542 ---
The Company
Buildings
RMB’000
As at January 1, 2022 ............................................. 97,547
Additions ...................................................... 37,007
Termination ..................................................... (6,571)
Depreciation provided during the year ................................. (33,391)
As at December 31, 2022 and January 1, 2023 .......................... 94,592
Termination ..................................................... (11,528)
Depreciation provided during the year ................................. (31,420)
As at December 31, 2023 and January 1, 2024 .......................... 51,644
Additions ...................................................... 3,037
Termination ..................................................... (1,486)
Depreciation provided during the year ................................. (24,689)
As at December 31, 2024 and January 1, 2025 .......................... 28,506
Additions ...................................................... 5,510
Depreciation provided during the period ............................... (18,791)
As at October 31, 2025 ............................................ 15,225
APPENDIX I ACCOUNTANTS’ REPORT
– I-83 –


--- page 543 ---
(b) Lease liabilities
The carrying amount of lease liabilities and the movements during the Relevant Periods are
as follows:
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Carrying amount at the beginning of
the year/period ................. 132,634 128,470 80,508 47,514
New leases ..................... 42,178 8,077 4,923 17,763
Accretion of interest recognised
during the year/period ........... 6,410 4,789 3,041 1,533
Payments ....................... (45,259) (44,707) (39,244) (31,675)
Acquisition of a subsidiary (note 39) . — 1 7 7——
Termination ..................... (7,493) (16,298) (1,714) (874)
Carrying amount at the end of the
year/period .................... 128,470 80,508 47,514 34,261
Analysed into:
Current portion .................. 45,063 35,497 34,716 22,120
Non-current portion ............... 83,407 45,011 12,798 12,141
APPENDIX I ACCOUNTANTS’ REPORT
– I-84 –


--- page 544 ---
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Carrying amount at the beginning of
the year/period ................. 100,239 98,699 55,419 31,397
New leases ..................... 37,007 — 3,037 5,510
Accretion of interest recognised
during the year/period ........... 4,850 3,563 2,107 919
Payments ....................... (35,904) (35,004) (27,618) (21,376)
Termination ..................... (7,493) (11,839) (1,548) —
Carrying amount at the end of the
year/period .................... 98,699 55,419 31,397 16,450
Analysed into:
Current portion .................. 35,922 24,486 23,833 13,162
Non-current portion ............... 62,777 30,933 7,564 3,288
The maturity analysis of lease liabilities is disclosed in note 47 to the Historical Financial
Information.
(c) The amounts recognised in profit or loss in relation to leases are as follows:
As at December 31, As at October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Interest on lease
liabilities ......... 6,410 4,789 3,041 2,506 1,533
Depreciation charge of
right-of-use assets ... 51,907 50,572 44,239 36,425 35,724
Expense relating to
short-term leases and
low-value assets* ... 20,517 15,585 18,075 15,724 23,428
Total amount
recognised in profit
or loss ........... 78,834 70,946 65,355 54,655 60,685
APPENDIX I ACCOUNTANTS’ REPORT
– I-85 –


--- page 545 ---
* Included in “Administrative expenses” and “Selling and marketing expenses” in the consolidated statements of
profit or loss.
(d) The total cash outflow for leases is set out in note 40 to the Historical Financial Information.
The Group as a lessor
The Group leases its machinery and investment properties (note 16) consisting of a
residential property in the Chinese mainland under operating lease arrangements. The terms of the
leases generally require the tenants to pay security deposits and provide for periodic rent
adjustments according to the then prevailing market conditions. Rental income recognised by the
Group during the years ended December 31, 2022, 2023 and 2024 and the ten months ended
October 31, 2024 and 2025 was RMB20,278,000, RMB11,142,000, RMB15,719,000,
RMB13,775,000 (unaudited) and RMB11,690,000, respectively, details of which are included in
note 5 to the Historical Financial Information.
At December 31, 2022, 2023 and 2024 and October 31, 2025, the undiscounted lease
payments receivable by the Group in future periods under operating leases with its tenants are as
follows:
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Within one year .................. 499 125 469 488
After one year but within two years .. 125 — 492 492
After two year but within three years . — — 492 82
Total .......................... 624 125 1,453 1,062
APPENDIX I ACCOUNTANTS’ REPORT
– I-86 –


--- page 546 ---
18. GOODWILL
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
At beginning of year/period:
Cost .......................... 22,302 22,302 163,341 163,341
Accumulated impairment ........... (9,378) (9,378) (9,378) (89,018)
Carrying amount at the beginning of
the year/period ................. 12,924 12,924 153,963 74,323
Cost at the beginning of year/period,
net of impairment .............. 12,924 12,924 153,963 74,323
Acquisition of a subsidiary (note 39) . — 141,039 — —
Impairment during the year/period ... — — (79,640) (61,399)
Carrying amount at the end of the
year/period .................... 12,924 153,963 74,323 12,924
At end of year/period:
Cost .......................... 22,302 163,341 163,341 163,341
Accumulated impairment ........... (9,378) (9,378) (89,018) (150,417)
Net carrying amount .............. 12,924 153,963 74,323 12,924
Impairment testing of goodwill
A CGU to which goodwill has been allocated is tested for impairment by the management
annually, and whenever there is an indication that the unit may be impaired.
Goodwill acquired through business combinations is allocated to the following
cash-generating units for impairment testing:
 Shenzhen Mason Electronics Co., Ltd. cash-generating unit;
 Advanced Intelligent Machine Co., Ltd. cash-generating unit; and
 Shenzhen Han’s Rayleigh Taide Precision Coating Co., Ltd. cash-generating unit.
APPENDIX I ACCOUNTANTS’ REPORT
– I-87 –


--- page 547 ---
The carrying amount of goodwill allocated to each of the cash-generating units is as follows:
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Mason CGU .................... 12,924 12,924 12,924 12,924
Advanced Intelligent CGU ......... ————
Rayleigh CGU ................... — 141,039 61,399 —
12,924 153,963 74,323 12,924
For the purpose of impairment review, the recoverable amount of a CGU is the higher of its
fair value less costs of disposal and its value in use. Assumptions were used in the calculation of
recoverable amounts of the Mason CGU and Rayleigh CGU. The following describes each key
assumption on which management has based its cash flow projections to undertake impairment
testing of goodwill:
Discount rates — The discount rates used are before tax for the recoverable amount
calculated based on value in use and after tax for the recoverable amount calculated based on fair
value less costs of disposal, respectively, and reflect specific risks relating to the relevant units.
Growth rates — The growth rates are determined based on historical experience and forecast
of market development in which the cash-generating unit operate in.
Shenzhen Mason Electronics Co., Ltd. cash-generating unit (the “Mason CGU”)
Impairment reviews on the goodwill of Mason CGU have been conducted by the management
as at December 31, 2022, 2023 and 2024 according to IAS 36 “Impairment of assets.” As at
October 31,2025, the management has considered and assessed all available internal and external
sources of information and has not identified any indications that an impairment loss of goodwill
may have occurred during the ten months ended October 31, 2025. Therefore the management did
not make a formal estimate of the recoverable amounts of Mason CGU as at October 31, 2025.
For the purposes of impairment review, the recoverable amount of the Mason CGU has been
determined based on a value in use calculation using cash flow projections based on financial
budgets covering a five-year period approved by the senior management. Based on the results of
the impairment assessments for goodwill of Mason CGU, headroom measured by the excess of the
recoverable amount over the carrying amount of Mason CGU as at December 31, 2022, 2023 and
2024 were RMB25,052,000, RMB24,845,000 and RMB42,118,000, respectively. As at December
APPENDIX I ACCOUNTANTS’ REPORT
– I-88 –


--- page 548 ---
31, 2022, 2023 and 2024, the pre-tax discount rate applied to the cash flow projections is 18.79%,
18.51% and 15.94%, respectively. The growth rate used to extrapolate the cash flows of the Mason
CGU beyond the five-year period is 2.00%, 2.00% and 2.00%, respectively.
For the sensitivity analysis conducted during the impairment review on the goodwill of
Mason CGU, had there been reasonably possible changes with an increase in pre-tax discount rate
by 1%, or with reduction of the growth rate used to extrapolate the cash flows of the Mason CGU
beyond the five-year period by 0.5%, it would cause the reduction of the recoverable amount of
Mason CGU as follows, if one of the key assumptions was to change while other variable held
constant: As at December 31, 2022, the recoverable amount would decrease by RMB14,100,000
and RMB1,300,000. As at December 31, 2023, the recoverable amount would decrease by
RMB16,300,000 and RMB1,500,000. As at December 31, 2024, the recoverable amount would
decrease by RMB18,500,000 and RMB1,500,000.
Advanced Intelligent Machine Co., Ltd. cash-generating unit (the “Advanced Intelligent CGU ”)
The carrying amount of the Advanced Intelligent CGU was fully impaired prior to the
beginning of the Relevant Periods.
Shenzhen Han’s Rayleigh Taide Precision Coating Co., Ltd. cash-generating unit (the “Rayleigh
CGU”)
According to IAS 36 “Impairment of assets”, impairment reviews on the goodwill of
Rayleigh CGU have been conducted by management annually as at December 31, 2023 and 2024.
And due to the intense market competition during the second half of 2025, the business growth of
Rayleign CGU was well below expectations thus there was an impairment indicator for the
goodwill of Rayleign CGU and impairment review has been conducted by management as at
October 31, 2025. As at December 31, 2023 and 2024, the recoverable amount of the Rayleigh
CGU has been determined based on the value in use which was the higher of fair value less costs
of disposal and value in use. The value in use calculation was determined using cash flow
projections based on financial budgets covering a five-year period approved by the senior
management. As at December 31, 2023 and 2024, the pre-tax discount rate applied to the cash flow
projections is 23.25% and 17.89%, respectively. As at October 31, 2025, the recoverable amount of
Rayleigh CGU has been determined based on the fair value less costs of disposal as it was higher
than the amount of value in use. The fair value less costs of disposal calculation was determined
using discounted cash flow projections of which the accuracy and reliability of the information is
reasonably assured by the appropriate budgeting, forecast and control process established by the
Group. The post-tax discount rate applied to the cash flow projections is 17.44%. The growth rate
used to extrapolate the cash flows of the Rayleigh CGU beyond the five-year period is 2.00%,
2.00% and 2.00%, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-89 –


--- page 549 ---
Based on the results of the impairment assessments, the recoverable amounts of the Rayleigh
CGU was RMB340,000,000, RMB99,820,000 and RMB5,228,000 as at December 31, 2023 and
2024 and October 31, 2025, respectively. Accordingly, the Group recognised an impairment
provision of approximately RMB79,640,000 for the year ended December 31, 2024 and
RMB61,399,000 for the ten months ended October 31, 2025 against the carrying amount of
goodwill relating to Rayleign CGU. The impairment for the year ended December 31, 2024 and the
ten months ended October 31, 2025 were attributable to the overall decline in forecasted revenue
generated by Rayleigh CGU in the cash flow projection prepared by the directors of the Group
with reference to the market activities of Rayleigh Taide.
Based on management’s assessment on the recoverable amounts, the headroom measured by
the excess of the recoverable amount over the carrying amount of Rayleigh CGU as at December
31, 2023 was RMB128,653,000. For the sensitivity analysis of Rayleigh conducted during the
impairment review, had there been reasonably possible changes with an increase in pre-tax
discount rate by 0.50%, or with reduction of the growth rate used to extrapolate the cash flows of
the Rayleigh CGU beyond the five-year period by 0.5%, it would cause the reduction of the
recoverable amount of Rayleigh CGU as follows, if one of the key assumptions was to change
while other variable held constant: As at December 31, 2023, the recoverable amount would
decrease by RMB8,000,000 and RMB3,000,000. As at December 31, 2024, the recoverable amount
would decrease by RMB4,386,000 and RMB1,211,000.
In the opinion of the directors of the Group, any reasonably possible change in the key
assumptions of the cash flow forecast would not cause its carrying amount of Rayleigh CGU
exceed its recoverable amount for the year ended December 31, 2023.
19. OTHER INTANGIBLE ASSETS
The Group
Software Patent Total
RMB’000 RMB’000 RMB’000
December 31, 2022
Cost at January 1, 2022, net of
accumulated amortisation ............. 8,170 — 8,170
Additions .......................... 2,029 — 2,029
Amortisation during the year ............ (2,083) — (2,083)
At December 31, 2022 ................ 8,116 — 8,116
APPENDIX I ACCOUNTANTS’ REPORT
– I-90 –


--- page 550 ---
Software Patent Total
RMB’000 RMB’000 RMB’000
At December 31, 2022:
Cost .............................. 14,913 — 14,913
Accumulated amortisation .............. (6,797) — (6,797)
Net carrying amount .................. 8,116 — 8,116
December 31, 2023
Cost at January 1, 2023, net of
accumulated amortisation ............. 8,116 — 8,116
Additions .......................... 1,066 65 1,131
Amortisation during the year ............ (2,404) (3) (2,407)
At December 31, 2023 ................ 6,778 62 6,840
At December 31, 2023:
Cost .............................. 12,615 65 12,680
Accumulated amortisation .............. (5,837) (3) (5,840)
Net carrying amount .................. 6,778 62 6,840
December 31, 2024
Cost at January 1, 2024, net of
accumulated amortisation ............. 6,778 62 6,840
Additions .......................... 957 — 957
Amortisation during the year ............ (2,599) (13) (2,612)
At December 31, 2024 ................ 5,136 49 5,185
At December 31, 2024:
Cost .............................. 13,332 65 13,397
Accumulated amortisation .............. (8,196) (16) (8,212)
Net carrying amount .................. 5,136 49 5,185
October 31, 2025
Cost at January 1, 2025, net of
accumulated amortisation ............. 5,136 49 5,185
Additions .......................... 1,092 472 1,564
Amortisation during the period .......... (2,209) (19) (2,228)
At October 31, 2025 .................. 4,019 502 4,521
At October 31, 2025:
Cost .............................. 14,424 537 14,961
Accumulated amortisation .............. (10,405) (35) (10,440)
Net carrying amount .................. 4,019 502 4,521
APPENDIX I ACCOUNTANTS’ REPORT
– I-91 –


--- page 551 ---
The Company
Software
RMB’000
December 31, 2022
Cost at January 1, 2022, net of accumulated amortisation .................. 6,702
Additions ...................................................... 906
Amortisation during the year ........................................ (1,562)
At December 31, 2022 ............................................ 6,046
At December 31, 2022:
Cost .......................................................... 10,539
Accumulated amortisation .......................................... (4,493)
Net carrying amount .............................................. 6,046
December 31, 2023
Cost at January 1, 2023, net of accumulated amortisation .................. 6,046
Additions ...................................................... 993
Amortisation during the year ........................................ (1,736)
At December 31, 2023 ............................................ 5,303
At December 31, 2023:
Cost .......................................................... 9,354
Accumulated amortisation .......................................... (4,051)
Net carrying amount .............................................. 5,303
December 31, 2024
Cost at January 1, 2024, net of accumulated amortisation .................. 5,303
Additions ...................................................... 775
Amortisation during the year ........................................ (1,907)
At December 31, 2024 ............................................ 4,171
At December 31, 2024:
Cost .......................................................... 9,935
Accumulated amortisation .......................................... (5,764)
Net carrying amount .............................................. 4,171
APPENDIX I ACCOUNTANTS’ REPORT
– I-92 –


--- page 552 ---
Software
RMB’000
October 31, 2025
Cost at January 1, 2025, net of accumulated amortisation .................. 4,171
Additions ...................................................... 1,472
Amortisation during the period ...................................... (1,800)
At October 31, 2025 .............................................. 3,843
At October 31, 2025:
Cost .......................................................... 11,407
Accumulated amortisation .......................................... (7,564)
Net carrying amount .............................................. 3,843
20. INVESTMENTS IN ASSOCIATES
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Share of net assets ............... 95,660 98,076 107,078 110,061
Less: Impairment ................. (55,768) (55,768) (55,768) (55,768)
39,892 42,308 51,310 54,293
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Share of net assets ............... 2 , 7 0 5———
Less: Impairment ................. ————
2 , 7 0 5———
APPENDIX I ACCOUNTANTS’ REPORT
– I-93 –


--- page 553 ---
As at December 31, 2022, based on the recoverable amount of RMB37,187,000, under the
fair value less cost of disposal calculation, the impairment loss amounting to RMB55,768,000 was
recognised on the investment in Shenzhen Mingxin Test Equipment Co., Ltd. (“ Shenzhen
Mingxin ”). The fair value was measured using asset-base method with key assumptions of
replacement cost.
In the opinion of the directors, no investments in associate are material to the Group and the
Company.
The following table illustrates the aggregate financial information of the Group’s associates
that are not individually material:
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Share of the associates’ (loss)/profit
for the year/period .............. (5,825) 5,685 13,166 5,573
Share of the associates’ other
comprehensive income/(loss)
for the year/period .............. 28 (14) 60 (40)
Share of the associates’ total
comprehensive (loss)/income for the
year/period .................... (5,797) 5,671 13,226 5,533
Changes of reserve due to passive
dilution of investment in an
associate ..................... — — (4,224) —
Dividends received from an associate . — — — (2,550)
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Aggregate carrying amount of the
Group’s investments in the
associates ..................... 39,892 42,308 51,310 54,293
APPENDIX I ACCOUNTANTS’ REPORT
– I-94 –


--- page 554 ---
21. INVENTORIES
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Raw materials ................... 360,195 272,782 226,303 494,169
Work in progress ................. 256,188 279,650 247,439 625,137
Semi-finished goods .............. 66,599 47,094 58,254 104,171
Materials consigned for processing ... 19,993 18,959 20,495 33,199
Finished goods .................. 50,967 45,759 36,581 52,371
Goods in transit .................. 182,734 365,487 352,143 465,815
936,676 1,029,731 941,215 1,774,862
Write-down of inventories to net
realisable value ................ (32,757) (57,614) (43,030) (57,983)
Total .......................... 903,919 972,117 898,185 1,716,879
The inventories are net of a write-down of approximately RMB32,757,000, RMB57,614,000,
RMB43,030,000 and RMB57,983,000 in the consolidated statements of financial position as at
December 31, 2022, 2023 and 2024 and October 31, 2025, respectively.
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Raw materials ................... 333,308 215,275 171,592 340,176
Work in progress ................. 201,662 189,784 165,828 368,129
Semi-finished goods .............. 41,246 23,580 25,173 51,877
Materials consigned for processing ... 15,469 14,841 13,558 19,794
Finished goods .................. 42,188 13,563 16,015 28,837
Goods in transit .................. 145,427 244,763 216,957 253,403
779,300 701,806 609,123 1,062,216
Write-down of inventories to net
realisable value ................ (24,232) (42,202) (28,687) (35,819)
Total .......................... 755,068 659,604 580,436 1,026,397
APPENDIX I ACCOUNTANTS’ REPORT
– I-95 –


--- page 555 ---
22. TRADE AND BILLS RECEIV ABLES
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade and bills receivables at
amortised cost
Trade receivables ............... 1,783,804 1,592,881 2,586,503 4,362,538
Bills receivable ................ 527,640 227,137 307,833 434,090
Less: Allowance for credit losses ... (98,864) (115,504) (137,604) (161,335)
Total ........................ 2,212,580 1,704,514 2,756,732 4,635,293
Less: Trade receivables due after
one year ................ (118,624) (60,913) (170,002) (513,566)
Trade and bills receivable —
current ..................... 2,093,956 1,643,601 2,586,730 4,121,727
Bills receivables at fair value
through other comprehensive
income
Bills receivables — current ....... 55,119 51,188 89,416 51,896
Total ......................... 2,149,075 1,694,789 2,676,146 4,173,623
APPENDIX I ACCOUNTANTS’ REPORT
– I-96 –


--- page 556 ---
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade and bills receivables at
amortised cost
Trade receivables ............... 1,458,914 942,234 1,621,927 3,163,539
Bills receivable ................ 484,287 139,786 173,084 258,575
Due from subsidiaries ........... 92,379 395,629 558,974 639,524
Less: Allowance for credit losses ... (79,721) (66,310) (77,495) (97,519)
Total ........................ 1,955,859 1,411,339 2,276,490 3,964,119
Less: Trade receivables due after
one year ................ (117,130) (39,738) (91,782) (398,257)
Trade and bills receivable —
current ..................... 1,838,729 1,371,601 2,184,708 3,565,862
Bills receivable at fair value
through other comprehensive
income
Bills receivable — current ....... 50,407 32,102 66,572 41,403
Total ......................... 1,889,136 1,403,703 2,251,280 3,607,265
The Group’s trading terms with its customers are mainly on credit. The credit period is
generally three to eighteen months, extending up to 24 months for certain major customers. The
Group seeks to maintain strict control over its outstanding receivables to minimise credit risk.
Overdue balances are reviewed regularly by senior management. Credit risk is managed on a
customer-by-customer basis. The Group does not hold any collateral or other credit enhancements
over its trade receivable balances. The balances of trade receivables are non-interest-bearing.
Transfers of financial assets
Financial assets that are derecognised in their entirety
Bills endorsed or discounted
At December 31, 2022, 2023 and 2024 and October 31, 2025, the Group endorsed certain
bills receivable accepted by banks in Chinese mainland to certain suppliers, and discounted certain
bills receivables to banks in Chinese mainland (“Derecognised Bills”), with a carrying amount in
APPENDIX I ACCOUNTANTS’ REPORT
– I-97 –


--- page 557 ---
aggregate of RMB217,148,000, RMB133,030,000, RMB243,527,000 and RMB244,245,000. The
Derecognised Bills had a maturity of one to ten months at the end of the Relevant Periods. In
accordance with the Law of Negotiable Instruments in the PRC, the holders of the Derecognised
Bills may exercise the right of recourse against any, several or all of the persons liable for the
Derecognised Bills, including the Group, in disregard of the order of precedence. In the opinion of
the directors, the risk of the Group being claimed by the holders of the Derecognised Bills is
remote in the absence of a default of the accepted banks. The Group has transferred substantially
all risks and rewards relating to the Derecognised Bills. Accordingly, it has derecognised the full
carrying amounts of the Derecognised Bills and the associated trade payables. The maximum
exposure to loss from the Group’s Continuing Involvement in the Derecognised Bills and the
undiscounted cash flows to repurchase these Derecognised Bills is equal to their carrying amounts.
In the opinion of the directors, the fair values of the Group’s Continuing Involvement in the
Derecognised Bills are not significant.
Financial assets that are not derecognised in their entirety
Bills endorsed or discounted
As part of its normal business, the Group discounted and endorsed certain bills receivable
accepted by banks or commercial entities in Chinese mainland (the “ Discounted and Endorsed
Bills ”) with a carrying amount of RMB117,720,000, RMB83,612,000, RMB101,443,000 and
RMB207,855,000 to certain banks and certain of its suppliers as at December 31, 2022, 2023 and
2024 and October 31, 2025. In the opinion of the directors, the Group has retained the substantial
risks and rewards, which include default risks relating to such Discounted and Endorsed Bills, and
accordingly, it continued to recognise the full carrying amounts of the Discounted and Endorsed
Bills and recognised the associated borrowings or other payables. Subsequent to the discounting
and endorsing, the Group did not retain any rights on the use of the Discounted and Endorsed
Bills, including the sale, transfer or pledge of the Discounted and Endorsed Bills to any other third
parties. The aggregate carrying amount of the borrowings recognised as at December 31, 2022,
2023 and 2024 and October 31, 2025 were RMB17,174,000, RMB744,000, RMB535,000 and
RMB600,000 (note 32). The aggregate carrying amount of the other payables recognised as at
December 31, 2022, 2023 and 2024 and October 31, 2025 were RMB100,546,000,
RMB82,868,000, RMB100,908,000 and RMB210,110,000 (note 31).
APPENDIX I ACCOUNTANTS’ REPORT
– I-98 –


--- page 558 ---
An aging analysis of the trade and bills receivables as at the end of each of the Relevant
Periods, based on the invoice date and net of allowance for expected credit losses, is as follows:
Trade receivable
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Within 1 year ................... 1,548,655 1,128,898 2,280,109 3,859,254
1 year to 2 years ................. 143,563 348,532 159,933 327,375
2 years to 3 years ................ 19,091 14,460 28,979 29,809
3 years to 5 years ................ 192 936 610 385
Over 5 years .................... 29 32 245 —
Total .......................... 1,711,530 1,492,858 2,469,876 4,216,823
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Within 1 year ................... 1,375,119 1,013,260 2,026,675 3,523,978
1 year to 2 years ................. 111,552 255,930 65,390 181,485
2 years to 3 years ................ 8,769 9,915 22,564 7,638
3 years to 4 years ................ 14 5 26 210
4 years to 5 years ................ —451
Total .......................... 1,495,454 1,279,114 2,114,660 3,713,312
APPENDIX I ACCOUNTANTS’ REPORT
– I-99 –


--- page 559 ---
Bills receivable
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Within 1 year ................... 348,131 162,699 280,651 372,796
1 year to 2 years ................. 207,381 88,124 67,705 35,204
2 years to 3 years ................ 657 12,021 27,916 62,179
3 years to 4 years ................ ——— 1 8 7
Total .......................... 556,169 262,844 376,272 470,366
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Within 1 year ................... 324,045 106,985 193,190 247,414
1 year to 2 years ................. 186,767 54,461 15,160 12,280
2 years to 3 years ................ — 2,881 20,052 32,516
Total .......................... 510,812 164,327 228,402 292,210
The movements in the loss allowance for impairment of trade and bills receivables are as
follows:
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
At beginning of year/period ........ 77,168 98,864 115,504 137,604
Impairment losses, net of reversal .... 22,634 16,282 22,243 23,755
Amount written off as uncollectible .. (943) (135) (148) (24)
Others ......................... 5 493 5 —
Total .......................... 98,864 115,504 137,604 161,335
APPENDIX I ACCOUNTANTS’ REPORT
– I-100 –


--- page 560 ---
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
At beginning of year/period ........ 66,109 79,721 66,310 77,495
Impairment losses, net of reversal .... 13,648 (13,345) 11,269 20,037
Amount written off as uncollectible .. (36) (66) (84) (13)
Total .......................... 79,721 66,310 77,495 97,519
For trade and bills receivables at amortised cost, the Group has applied the simplified
approach in IFRS 9 to measure the loss allowance at an amount equal to lifetime ECLs. The Group
determines the ECLs on these items by using a provision matrix, estimated based on the financial
quality of the debtors and historical credit loss experience based on the ageing of the trade
receivables, adjusted as appropriate to reflect current conditions and estimates of future economic
conditions.
For certain customers with different credit risk characteristics, the Group has made individual
loss allowance.
The following table details the risk profile of trade receivables:
The Group
As at December 31, 2022
Gross carrying
amount
Expected credit
loss rate
Expected credit
losses
RMB’000 % RMB’000
Within 1 year ....................... 1,596,553 3% 47,897
1 year to 2 years ..................... 159,514 10% 15,951
2 years to 3 years .................... 27,273 30% 8,182
3 years to 4 years .................... 384 50% 192
4 years to 5 years .................... 57 50% 29
Over 5 years ........................ 23 100% 23
Total .............................. 1,783,804 4% 72,274
APPENDIX I ACCOUNTANTS’ REPORT
– I-101 –


--- page 561 ---
As at December 31, 2023
Gross carrying
amount
Expected credit
loss rate
Expected credit
losses
RMB’000 % RMB’000
Within 1 year ....................... 1,159,763 3% 34,781
1 year to 2 years ..................... 386,893 10% 38,701
2 years to 3 years .................... 12,982 30% 3,895
3 years to 4 years .................... 21 50% 10
4 years to 5 years .................... 63 50% 32
Over 5 years ........................ —0 % —
Subtotal ............................ 1,559,722 5% 77,419
Trade receivable balance with different
credit risk characteristics and being
assessed individually ................ 33,159 68% 22,604
Total .............................. 1,592,881 6% 100,023
As at December 31, 2024
Gross carrying
amount
Expected credit
loss rate
Expected credit
losses
RMB’000 % RMB’000
Within 1 year ....................... 2,350,411 3% 70,512
1 year to 2 years ..................... 177,167 10% 17,717
2 years to 3 years .................... 41,081 30% 12,324
3 years to 4 years .................... 182 50% 91
4 years to 5 years .................... 9 50% 5
Over 5 years ........................ 8 100% 8
Subtotal ............................ 2,568,858 4% 100,657
Trade receivable balance with different
credit risk characteristics and being
assessed individually ................ 17,645 91% 15,970
Total .............................. 2,586,503 5% 116,627
APPENDIX I ACCOUNTANTS’ REPORT
– I-102 –


--- page 562 ---
As at October 31, 2025
Gross carrying
amount
Expected credit
loss rate
Expected credit
losses
RMB’000 % RMB’000
Within 1 year ....................... 3,948,693 2% 90,253
1 year to 2 years ..................... 357,894 9% 30,818
2 years to 3 years .................... 37,663 22% 8,234
3 years to 4 years .................... 262 43% 113
4 years to 5 years .................... 128 80% 102
Over 5 years ........................ 18 100% 18
Subtotal ............................ 4,344,658 3% 129,538
Trade receivable balance with different
credit risk characteristics and being
assessed individually ................ 17,880 90% 16,177
Total .............................. 4,362,538 3% 145,715
The Company
As at December 31, 2022
Gross carrying
amount
Expected credit
loss rate
Expected credit
losses
RMB’000 % RMB’000
Within 1 year ....................... 1,322,412 3% 39,672
1 year to 2 years ..................... 123,947 10% 12,395
2 years to 3 years .................... 12,527 30% 3,758
3 years to 4 years .................... 28 50% 14
Subtotal ............................ 1,458,914 4% 55,839
Due from subsidiaries ................. 92,379 0% —
Total .............................. 1,551,293 4% 55,839
APPENDIX I ACCOUNTANTS’ REPORT
– I-103 –


--- page 563 ---
As at December 31, 2023
Gross carrying
amount
Expected credit
loss rate
Expected credit
losses
RMB’000 % RMB’000
Within 1 year ....................... 636,603 3% 19,098
1 year to 2 years ..................... 284,152 10% 28,415
2 years to 3 years .................... 7,198 30% 2,159
3 years to 4 years .................... 9 50% 5
4 years to 5 years .................... 8 50% 4
Subtotal ............................ 927,970 5% 49,681
Trade receivable balance with different
credit risk characteristics and being
assessed individually ................ 14,264 64% 9,068
Due from subsidiaries ................. 395,629 0% —
Total .............................. 1,337,863 4% 58,749
As at December 31, 2024
Gross carrying
amount
Expected credit
loss rate
Expected credit
losses
RMB’000 % RMB’000
Within 1 year ....................... 1,513,094 3% 45,393
1 year to 2 years ..................... 72,514 10% 7,251
2 years to 3 years .................... 31,957 30% 9,587
3 years to 4 years .................... 5 50% 3
4 years to 5 years .................... 9 50% 5
Over 5 years ........................ 8 100% 8
Subtotal ............................ 1,617,587 4% 62,247
Trade receivable balance with different
credit risk characteristics and being
assessed individually ................ 4,340 92% 3,996
Due from subsidiaries ................. 558,974 0% —
Total .............................. 2,180,901 3% 66,243
APPENDIX I ACCOUNTANTS’ REPORT
– I-104 –


--- page 564 ---
As at October 31, 2025
Gross carrying
amount
Expected credit
loss rate
Expected credit
losses
RMB’000 % RMB’000
Within 1 year ....................... 2,955,287 2% 66,345
1 year to 2 years ..................... 193,773 9% 16,780
2 years to 3 years .................... 10,107 26% 2,607
3 years to 4 years .................... 12 42% 5
4 years to 5 years .................... 5 80% 4
Over 5 years ........................ 18 100% 18
Subtotal ............................ 3,159,202 3% 85,759
Trade receivable balance with different
credit risk characteristics and being
assessed individually ................ 4,337 92% 3,992
Due from subsidiaries ................. 639,524 — —
Total .............................. 3,803,063 2% 89,751
The expected credit risk rate of bills receivables at amortised cost ranged from 0% to 30%
during the Relevant Periods. Bills receivable at fair value through other comprehensive income is
subject to impairment under the general approach and the impairment is considered to be minimal.
APPENDIX I ACCOUNTANTS’ REPORT
– I-105 –


--- page 565 ---
23. PREPAYMENTS, OTHER RECEIV ABLES AND OTHER ASSETS
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Current portion
Prepayments .................... 7,633 8,017 31,831 37,546
Deposits ....................... 6,201 10,386 6,694 6,915
Prepaid income taxes .............. 334 2,105 — —
Value added tax recoverable ........ 436 19,160 17,077 48,438
Deferred listing expenses .......... — — — 12,883
Other receivables ................ 2,335 2,167 2,606 11,810
Subtotal ........................ 16,939 41,835 58,208 117,592
Less: Impairment losses ........... (1,040) (2,429) (3,388) (5,507)
Total current portion .............. 15,899 39,406 54,820 112,085
Non-current portion
Prepayments for acquisition of
non-current assets .............. 28,008 2,739 203 3,439
Long-term prepaid expenses ........ 35,485 28,515 17,585 8,815
Long-term deposits ............... 5,620 837 5,698 7,225
Other receivables ................ — — 7,453 —
Value added tax recoverable ........ 4,388 19,417 38,091 19,894
Subtotal ........................ 73,501 51,508 69,030 39,373
Less: Impairment losses ........... ————
Total non-current portion ........... 73,501 51,508 69,030 39,373
Total .......................... 89,400 90,914 123,850 151,458
APPENDIX I ACCOUNTANTS’ REPORT
– I-106 –


--- page 566 ---
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Current portion
Prepayments .................... 6,507 7,235 10,609 18,604
Deposits ....................... 4,360 8,083 4,502 5,941
Prepaid income taxes .............. — 1 , 7 6 6——
Value added tax recoverable ........ 48 1,684 3,814 7,878
Deferred listing expenses .......... — — — 12,883
Other receivables ................ 2,011 1,325 1,430 6,841
Amounts due from subsidiaries ...... 125,030 345,312 656,316 748,973
Dividend receivables .............. 150,000 300,000 300,000 300,000
Subtotal ........................ 287,956 665,405 976,671 1,101,120
Less: Impairment losses ........... (828) (1,875) (2,485) (3,071)
Total current portion .............. 287,128 663,530 974,186 1,098,049
Non-current portion
Prepayments for acquisition of
non-current assets .............. 208 2,617 202 1,647
Long-term prepaid expenses ........ 35,486 28,515 17,586 8,815
Long-term deposits ............... 5,506 448 5,319 5,335
Other receivables ................ — — 7,453 —
Subtotal ........................ 41,200 31,580 30,560 15,797
Less: Impairment losses ........... ————
Total non-current portion ........... 41,200 31,580 30,560 15,797
Total .......................... 328,328 695,110 1,004,746 1,113,846
The balances of other receivables are interest-free and are not secured with collateral.
Deposits mainly represent rental deposits and deposits with suppliers. At the end of each of
the Relevant Periods, the ECLs of the financial assets included in prepayments, other receivables
and other assets were measured based on the 12-month expected credit loss if they were not past
due and there was no information indicating that the financial assets had a significant increase in
credit risk since initial recognition. Otherwise, they were measured based on the lifetime expected
credit loss. An impairment analysis was performed at the end of each of the Relevant Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-107 –


--- page 567 ---
The movements in the loss allowance for impairment of other receivables are as follows:
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
At beginning of year/period ........ 417 1,040 2,429 3,388
Impairment losses, net of reversal .... 623 1,378 959 2,119
Others ......................... —1 1——
Total .......................... 1,040 2,429 3,388 5,507
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
At beginning of year/period ........ 317 828 1,875 2,485
Impairment losses, net of reversal .... 511 1,047 610 586
Total .......................... 828 1,875 2,485 3,071
Set out below is the information about the credit risk exposure on the financial assets
included in the prepayments, other receivables and other assets using a provision matrix:
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Expected credit loss rate ........... 7% 18% 15% 21%
Gross carrying amount ............ 14,156 13,390 22,451 25,950
Expected credit losses ............. 1,040 2,429 3,388 5,507
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 568 ---
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Expected credit loss rate ........... 0.29% 0.29% 0.25% 0.29%
Gross carrying amount ............ 286,907 655,168 975,020 1,074,968
Expected credit losses ............. 828 1,875 2,485 3,071
24. CONTRACT ASSETS
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Retention receivables ............. 20,114 20,282 25,705 47,048
Less: impairment ................. (935) (672) (825) (1,160)
Net carrying amount .............. 19,179 19,610 24,880 45,888
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Retention receivables ............. 15,413 15,450 18,779 35,746
Less: impairment ................. (655) (479) (563) (783)
Net carrying amount .............. 14,758 14,971 18,216 34,963
Contract assets are initially recognised for revenue earned from the sale of industrial products
as the receipt of consideration is conditional on successful assurance during the warranty periods.
When passing the warranty periods, the amounts recognised as contract assets are reclassified to
trade receivables.
APPENDIX I ACCOUNTANTS’ REPORT
– I-109 –


--- page 569 ---
The expected timing of recovery or settlement for contract assets as at December 31 and
October 31, is as follows:
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Within one year .................. 18,275 18,844 24,600 41,148
After one year ................... 904 766 280 4,740
Total .......................... 19,179 19,610 24,880 45,888
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Within one year .................. 13,854 14,971 17,936 32,494
After one year ................... 904 — 280 2,469
Total .......................... 14,758 14,971 18,216 34,963
The movements in the loss allowance for impairment of contract assets are as follows:
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
At the beginning of the year/period ... 1,412 935 672 825
(Reversal of impairment)/impairment
losses, net .................... (477) (263) 153 335
At the end of the year/period ....... 935 672 825 1,160
APPENDIX I ACCOUNTANTS’ REPORT
– I-110 –


--- page 570 ---
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
At the beginning of the year/period ... 1,054 655 479 563
(Reversal of impairment)/impairment
losses, net .................... (399) (176) 84 220
At the end of the year/period ....... 655 479 563 783
An impairment analysis is performed at each reporting date using a provision matrix to
measure expected credit losses. The provision rates for the measurement of the expected credit
losses of the contract assets are based on those of the trade and bills receivables as the contract
assets and the trade and bills receivables are from the same customer bases. The provision rates of
contract assets are based on historical data adjusted by forward-looking information. The
calculation are adjusted as appropriate to reflect current conditions and estimates of future
economic conditions.
Set out below is the information about the credit risk exposure on contract assets using a
provision matrix:
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Expected credit loss rate ........... 4.65% 3.31% 3.21% 2.47%
Gross carrying amount ............ 20,114 20,282 25,705 47,048
Expected credit losses ............. 935 672 825 1,160
APPENDIX I ACCOUNTANTS’ REPORT
– I-111 –


--- page 571 ---
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Expected credit loss rate ........... 4.25% 3.10% 3.00% 2.19%
Gross carrying amount ............ 15,413 15,450 18,779 35,746
Expected credit losses ............. 655 479 563 783
25. INVESTMENTS IN SUBSIDIARIES
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Investments in subsidiaries — costs .. 573,250 885,978 931,588 979,902
Less: provision for impairment ..... (2,232) (2,232) (2,232) (132,627)
Investments in subsidiaries ......... 571,018 883,746 929,356 847,275
Impairment reviews on the investments in subsidiaries have been conducted by management
annually as at December 31, 2023 and 2024. And due to the performance of Rayleigh Taide was
well below expectations thus there was an impairment indicator for the investment in Rayleigh
Taide and impairment review has been conducted by management as at October 31, 2025. Based
on the result of the impairment assessment, the recoverable amount of the investment in subsidiary
of Rayleigh Taide was RMB18,487,000 as at October 31, 2025. Accordingly, the Group recognised
an impairment provision of approximately RMB130,395,000 for the ten months ended October 31,
2025 against the carrying amount of investment in subsidiary of Rayleigh Taide. Please refer to
note 18 to the Historical Financial Information for the details.
APPENDIX I ACCOUNTANTS’ REPORT
– I-112 –


--- page 572 ---
26. CASH AND CASH EQUIV ALENTS AND RESTRICTED DEPOSITS
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Cash and bank balances ........... 2,986,535 1,918,781 1,939,464 1,564,000
Less: restricted cash .............. — (1,816) (333) (542)
Less: time deposits .............. — — (400,000) (417,114)
Total cash and cash equivalents ...... 2,986,535 1,916,965 1,539,131 1,146,344
Denominated in:
United States Dollar (“ USD”) ....... 7,669 15,088 17,338 51,772
Hong Kong Dollar (“ HKD”) ........ 19,074 22,722 12,261 9,124
Renminbi (“ RMB”)............... 2,959,792 1,879,155 1,509,532 1,084,930
Singapore Dollar (“ SGD”).......... ——— 5 1 8
Total .......................... 2,986,535 1,916,965 1,539,131 1,146,344
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Cash and bank balances ........... 2,893,102 1,813,981 1,690,030 1,467,760
Less: restricted cash .............. — (1,816) (330) (542)
Less: time deposits .............. — — (400,000) (417,114)
Total cash and cash equivalents ...... 2,893,102 1,812,165 1,289,700 1,050,104
Denominated in:
USD .......................... 285 11,284 7,850 34,406
RMB .......................... 2,892,817 1,800,881 1,281,850 1,015,698
Total .......................... 2,893,102 1,812,165 1,289,700 1,050,104
As at December 31, 2023 and 2024 and October 31, 2025 included in restricted cash of
RMB1,816,000, RMB330,000 and RMB542,000, respectively, was frozen by judicial authority for
certain lawsuit cases.
APPENDIX I ACCOUNTANTS’ REPORT
– I-113 –


--- page 573 ---
The RMB is not freely convertible into other currencies, however, under Chinese mainland’s
Foreign Exchange Control Regulations and Administration of Settlement, Sale and Payment of
Foreign Exchange Regulations, the Group is permitted to exchange RMB for other currencies
through banks authorised to conduct foreign exchange business.
Cash at banks earns interest at floating rates based on daily bank deposit rates. The bank
balances are deposited with creditworthy banks with no recent history of default. As at December
31, 2022 and 2023 and 2024 and October 31, 2025, the Group and the Company have assessed the
credit risk of cash and cash equivalents, time deposits and restricted cash to be minimal as they
were placed in reputable financial institutions.
The carrying amounts of the cash and cash equivalents approximated to their fair values due
to its short-term maturity.
27. TRADE AND BILLS PAYABLES
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade payables .................. 398,582 545,395 664,080 1,368,006
Bills payables ................... 272,894 46,623 611,557 876,893
Total .......................... 671,476 592,018 1,275,637 2,244,899
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade payables .................. 324,079 416,446 411,610 963,057
Bills payables ................... 272,894 49,623 611,557 854,153
Total .......................... 596,973 466,069 1,023,167 1,817,210
APPENDIX I ACCOUNTANTS’ REPORT
– I-114 –


--- page 574 ---
An aging analysis of the trade payables as at the end of each of the Relevant Periods, based
on the invoice date, is as follows:
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Within one year .................. 391,293 529,811 652,541 1,354,535
1 to 2 years ..................... 6,270 8,713 2,046 1,816
2 to 3 years ..................... 807 6,126 3,361 3,676
over 3 years .................... 212 745 6,132 7,979
Total .......................... 398,582 545,395 664,080 1,368,006
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Within one year ................. 317,270 401,709 401,539 951,776
1 to 2 years ..................... 6,158 8,120 1,235 715
2 to 3 years ..................... 562 6,031 2,878 3,180
over 3 years .................... 89 586 5,958 7,386
Total .......................... 324,079 416,446 411,610 963,057
Trade and bills payables are non-interest-bearing and are normally settled within three
months. As at the end of each of the Relevant Periods, the carrying amounts of trade and bills
payables approximated to their fair values.
APPENDIX I ACCOUNTANTS’ REPORT
– I-115 –


--- page 575 ---
28. CONTRACT LIABILITIES
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Sale of goods ................... 25,955 65,754 54,895 61,423
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Sale of goods ................... 14,876 31,532 30,247 42,601
The contract liabilities represent the advances received from customers.
29. DEFERRED INCOME
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Government grants* .............. 3,453 2,282 1,769 1,173
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Government grants* .............. 2,713 1,662 1,105 641
* The Group’s deferred income represented government grants received for projects and are credited to profit or loss on
a straight-line basis over the expected lives of the related assets. There are no unfulfilled conditions or contingencies
relating to these grants.
APPENDIX I ACCOUNTANTS’ REPORT
– I-116 –


--- page 576 ---
30. PROVISION
The Group
Warranty Contingencies Total
RMB’000 RMB’000 RMB’000
At January 1, 2022 ................... 35,560 — 35,560
Provision for the year ................. 26,998 613 27,611
Amounts utilised during the year ......... (33,081) — (33,081)
At December 31, 2022 and January 1,
2023 ............................ 29,477 613 30,090
Provision for the year ................. 13,082 478 13,560
Amounts utilised during the year ......... (28,691) (613) (29,304)
At December 31, 2023 and January 1,
2024 ............................ 13,868 478 14,346
Provision for the year ................. 33,553 358 33,911
Amounts utilised during the year ......... (25,686) (160) (25,846)
At December 31, 2024 and January 1,
2025 ............................ 21,735 676 22,411
Provision for the period ............... 31,401 (300) 31,101
Amounts utilised during the period ....... (13,468) (136) (13,604)
At October 31, 2025 ................. 39,668 240 39,908
APPENDIX I ACCOUNTANTS’ REPORT
– I-117 –


--- page 577 ---
The Company
Warranty Contingencies Total
RMB’000 RMB’000 RMB’000
At January 1, 2022 ................... 35,286 — 35,286
Provision for the year ................. 26,852 507 27,359
Amounts utilised during the year ......... (32,780) — (32,780)
At December 31, 2022 and January 1,
2023 ............................ 29,358 507 29,865
Provision for the year ................. 12,539 478 13,017
Amounts utilised during the year ......... (28,334) (507) (28,841)
At December 31, 2023 and January 1,
2024 ............................ 13,563 478 14,041
Provision for the year ................. 32,718 358 33,076
Amounts utilised during the year ......... (25,305) (160) (25,465)
At December 31, 2024 and January 1, 2025 20,976 676 21,652
Provision for the period ............... 30,786 (300) 30,486
Amounts utilised during the period ....... (13,306) (136) (13,442)
At October 31, 2025 ................. 38,456 240 38,696
The Group generally provides warranties from 12 months to 24 months to its customers on
certain of its products for general repairs of defects occurring during the warranty period. The
amount of the provision for the warranties is estimated based on sales volumes and past experience
of the level of repairs and returns. The estimation basis is reviewed on an ongoing basis and
revised where appropriate.
APPENDIX I ACCOUNTANTS’ REPORT
– I-118 –


--- page 578 ---
31. OTHER PAYABLES AND ACCRUALS
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Payroll and welfare payables ........ 304,272 204,448 179,436 250,732
Endorsed bills receivable that have
not been derecognised and not yet
due ......................... 100,546 82,868 100,908 210,110
Payable for acquisition of non-current
assets ........................ 51,033 56,301 100,318 105,087
Other tax payables ............... 37,066 19,615 15,836 15,052
Accruals ....................... 9,439 14,768 14,336 9,131
Deposits ....................... 971 877 691 864
Others ......................... — 1,583 56 —
Total .......................... 503,327 380,460 411,581 590,976
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Payroll and welfare payables ........ 262,544 168,012 133,597 200,418
Endorsed bills receivable that have
not been derecognised and not yet
due ......................... 71,947 54,954 59,742 105,242
Payable for acquisition of non-current
assets ........................ 10,412 2,629 4,790 7,620
Other tax payables ............... 27,670 11,816 8,728 9,058
Accruals ....................... 7,090 7,670 9,008 7,340
Deposits ....................... 848 779 602 753
Other payables to subsidiaries ....... — 686 2,251 —
Total .......................... 380,511 246,546 218,718 330,431
APPENDIX I ACCOUNTANTS’ REPORT
– I-119 –


--- page 579 ---
32. INTEREST-BEARING BORROWINGS
The Group and the Company
As at December 31, 2022
Effective interest
rates (%) Maturity RMB’000
Current
Discounted unmatured bills ............. 1.60% 2023 17,174
As at December 31, 2023
Effective interest
rates (%) Maturity RMB’000
Current
Bank loans — unsecured ............... 2.75%-2.8% 2024 75,000
Discounted unmatured bills ............. 1.27% 2024 744
Total .............................. 75,744
As at December 31, 2024
Effective interest
rates (%) Maturity RMB’000
Current
Current portion of long-term bank loans —
unsecured ......................... 2.40%-2.63% 2025 1,891
Discounted unmatured bills ............. 0.85% 2025 535
Total — current ...................... 2,426
Non-current
Bank loans — unsecured ............... 2.40%-2.63% 2026-2027 211,050
Total .............................. 213,476
APPENDIX I ACCOUNTANTS’ REPORT
– I-120 –


--- page 580 ---
The Group
As at October 31, 2025
Effective interest
rates (%) Maturity RMB’000
Current
Bank loans — unsecured (note) .......... 2.08%−3.00% 2025−2026 614,215
Current portion of long-term bank loans —
unsecured ......................... 2.28%−2.4% 2025−2026 31,080
Discounted unmatured bills ............. 1.02% 2025 600
Total — current ...................... 645,895
Non-current
Bank loans — unsecured ............... 2.40% 2027 179,960
Total .............................. 825,855
The Company
As at October 31, 2025
Effective interest
rates (%) Maturity RMB’000
Current
Bank loans — unsecured (note) .......... 2.08%−3.00% 2025−2026 614,215
Current portion of long-term bank loans —
unsecured ......................... 2.28%−2.4% 2025−2026 31,080
Total — current ...................... 645,295
Non-current
Bank loans — unsecured ............... 2.40% 2027 179,960
Total .............................. 825,255
Note: The financial liabilities that are part of the Group’s supplier finance arrangements included in interest-bearing
borrowings are normally settled on 90-day terms.
The Group has established supplier finance arrangements that are offered to some of the
Group’s key suppliers in Chinese mainland. Participation in the arrangements is at the suppliers’
own discretion. Suppliers that participate in the supplier finance arrangements will receive early
payments or payments at the original due dates on invoices sent to the Group from the Group’s
external finance provider. If suppliers choose to receive early payments, the Group pays a fee to
the finance provider. In order for the finance provider to pay the invoices, the goods must have
APPENDIX I ACCOUNTANTS’ REPORT
– I-121 –


--- page 581 ---
been received or supplied and the invoices must have been approved by the Group. Payments to
suppliers ahead of or at the invoice due date are processed by the finance provider and, in all
cases, the Group settles the original invoice by paying the finance provider in line with the
original invoice maturity date or at a later date as agreed with the finance provider. Payment terms
with suppliers have not been renegotiated in conjunction with the arrangement. The Group
provides no security to the finance provider.
All financial liabilities that are part of the supplier finance arrangements are included in
interest-bearing borrowings in the statement of financial position.
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Interest-bearing borrowings of which
suppliers have received payments .. — — — 27,727
An analysis of the maturity of borrowings is as follows:
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Analysed into:
Bank loan and other borrowings
repayable:
Within one year or on demand ..... 17,174 75,744 2,426 645,895
In the second year .............. — — 31,100 20
In the third year ................ — — 179,950 179,940
Total .......................... 17,174 75,744 213,476 825,855
The Group’s bank loans are all denominated in RMB.
APPENDIX I ACCOUNTANTS’ REPORT
– I-122 –


--- page 582 ---
33. LIABILITIES FROM CONTINGENT CONSIDERATION
Pursuant to the acquisition agreement entered into between the Company and the then
shareholder of the 60% equity interest in Rayleigh Taide on May 30, 2023, the total consideration
shall be adjusted with reference to the net profit of Rayleigh Taide for the years ended December
31, 2023, 2024 and 2025 (the “ Contingent Consideration ”). The Contingent Consideration is
measured at fair value through profit or loss and the fair value was assessed by an independent
professional valuer.
The Group and the Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Payable for acquisition of Rayleigh
Taide ........................ — 68,683 8,523 —
Significant unobservable valuation inputs for the fair value measurement of the contingent
consideration are as follows:
Discount rate ............................................. 1.05% to 2.34%
A significant increase/(decrease) in the discount rate would result in a significant
decrease/(increase) in the fair value of the contingent consideration liability.
APPENDIX I ACCOUNTANTS’ REPORT
– I-123 –


--- page 583 ---
34. DEFERRED TAX
The movements in deferred tax assets and liabilities during the Relevant Periods are as
follows:
Deferred tax assets
The Group
Impairment
of
inventories
Impairment
losses on
financial
assets
Share-based
payment Warranty
Accrued
expenses
Deferred
income
Depreciation
and
amortisation
allowance in
excess of
related
depreciation Tax losses
Unsettled
payroll
payables
Temporary
difference on
unrealised
profit from
intra-group
transactions
Lease
liabilities Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2022 ........ 2,884 11,646 3,750 5,334 195 670 162 1,217 24,472 94 418 50,842
Deferred tax credited/(charged) to
profit or loss ......... 2,187 3,345 (3,750) (912) 1,498 (152) 102 416 4,188 (33) 297 7,186
Deferred tax charged to equity ... —————————8 4—8 4
Gross deferred tax assets at
December 31, 2022 and January 1,
2023 ............ 5,071 14,991 — 4,422 1,693 518 264 1,633 28,660 145 715 58,112
Deferred tax credited/(charged) to
profit or loss ......... 2,125 (1,567) 1,892 (2,270) (283) (176) 93 21,701 (13,679) 1,590 11,381 20,807
Deferred tax charged to equity ... — 2 8 1————————— 2 8 1
Gross deferred tax assets at
December 31, 2023 and January 1,
2024 ............ 7,196 13,705 1,892 2,152 1,410 342 357 23,334 14,981 1,735 12,096 79,200
Deferred tax credited/(charged) to
profit or loss ......... (2,396) 4,436 20,200 1,210 106 (76) 164 (21,279) (8,488) (864) (5,361) (12,348)
Deferred tax charged to equity ... — 4————————— 4
Gross deferred tax assets at
December 31, 2024 and January 1,
2025 ............ 4,800 18,145 22,092 3,362 1,516 266 521 2,055 6,493 871 6,735 66,856
Deferred tax credited/(charged) to
profit or loss ......... 3,368 5,649 (5,783) 2,813 2,361 (90) 81 (177) 23,605 136 (1,324) 30,639
Deferred tax charged to equity ... — ( 4 ) ————————— ( 4 )
Gross deferred tax assets at October
31, 2025 ........... 8,168 23,790 16,309 6,175 3,877 176 602 1,878 30,098 1,007 5,411 97,491
APPENDIX I ACCOUNTANTS’ REPORT
– I-124 –


--- page 584 ---
The Company
Impairment
of
inventories
Impairment
losses on
financial
assets
Share-based
payment Warranty
Accrued
expenses
Deferred
income
Depreciation
and
amortisation
allowance
in excess of
related
depreciation Tax losses
Unsettled
payroll
payables
Lease
liabilities Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2022 ...... 1,639 10,122 3,100 5,293 195 541 137 — 23,094 15,036 59,157
Deferred tax credited/(charged)
to profit or loss ...... 1,996 2,059 (3,100) (813) 1,406 (134) 104 — 5,056 (231) 6,343
Gross deferred tax assets at
December 31, 2022 and
January 1, 2023 ...... 3,635 12,181 — 4,480 1,601 407 241 — 28,150 14,805 65,500
Deferred tax credited/(charged)
to profit or loss ...... 2,695 (1,881) 1,652 (2,374) (543) (158) 116 18,267 (13,169) (6,492) (1,887)
Gross deferred tax assets at
December 31, 2023 and
January 1, 2024 ...... 6,330 10,300 1,652 2,106 1,058 249 357 18,267 14,981 8,313 63,613
Deferred tax credited/(charged)
to profit or loss ...... (2,027) 1,782 17,732 1,142 290 (84) 127 (18,267) (8,523) (3,603) (11,431)
Gross deferred tax assets at
December 31, 2024 and
January 1, 2025 ...... 4,303 12,082 19,384 3,248 1,348 165 484 — 6,458 4,710 52,182
Deferred tax credited/(charged)
to profit or loss ...... 1,260 3,083 (3,072) 2,555 1,987 (69) 118 — 23,605 (2,243) 27,224
Gross deferred tax assets at
October 31, 2025 ...... 5,563 15,165 16,312 5,803 3,335 96 602 — 30,063 2,467 79,406
APPENDIX I ACCOUNTANTS’ REPORT
– I-125 –


--- page 585 ---
Deferred tax liabilities
The Group
Right-of-use
assets
Depreciation
difference
between the
useful lives of
long-term
assets
Fair value
adjustment
from business
combination
Fair value
adjustments
of Liabilities
from
contingent
consideration Others Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2022 ............. ———— 1 1 , 1 1 5 1 1 , 1 1 5
Deferred tax charged/(credited) to
profit or loss ............... — 1,044 — — (8,365) (7,321)
Gross deferred tax liabilities at
December 31, 2022 and
January 1, 2023 ............. — 1,044 — — 2,750 3,794
Deferred tax charged/(credited) to
profit or loss ............... 11,437 (357) 2,304 — — 13,384
Gross deferred tax liabilities at
December 31, 2023 and
January 1, 2024 ............. 11,437 687 2,304 — 2,750 17,178
Deferred tax charged/(credited) to
profit or loss ............... (5,208) (159) — 9,024 1,118 4,775
Gross deferred tax liabilities at
December 31, 2024 and January 1,
2025 .................... 6,229 528 2,304 9,024 3,868 21,953
Deferred tax charged/(credited) to
profit or loss ............... (1,025) (131) — (9,024) 1,649 (8,531)
Gross deferred tax liabilities at
October 31, 2025 ............ 5,204 397 2,304 — 5,517 13,422
APPENDIX I ACCOUNTANTS’ REPORT
– I-126 –


--- page 586 ---
The Company
Right-of-use
assets
Fair value
adjustments
of Liabilities
from
contingent
consideration
Depreciation
difference
between the
useful lives of
long-term
assets Other Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2022 ............. 14,632 — — — 14,632
Deferred tax charged/(credited) to
profit or loss ............... (443) — 783 — 340
Gross deferred tax liabilities at
December 31, 2022 and
January 1, 2023 ............. 14,189 — 783 — 14,972
Deferred tax credited to profit or
loss ...................... (6,442) — (265) — (6,707)
Gross deferred tax liabilities at
December 31, 2023 and
January 1, 2024 ............. 7,747 — 518 — 8,265
Deferred tax charged/(credited) to
profit or loss ............... (3,471) 9,024 (124) 1,118 6,547
Gross deferred tax liabilities at
December 31, 2024 and January 1,
2025 ..................... 4,276 9,024 394 1,118 14,812
Deferred tax charged/(credited) to
profit or loss ............... (1,992) (9,024) (103) 1,449 (9,670)
Gross deferred tax liabilities at
October 31, 2025 ............ 2,284 — 291 2,567 5,142
APPENDIX I ACCOUNTANTS’ REPORT
– I-127 –


--- page 587 ---
For the purpose of presentation in the consolidated statement of financial position, certain
deferred tax assets and liabilities have been offset. The following is the analysis of the deferred tax
balances for financial reporting purposes:
The Group
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Net deferred tax assets recognised in
the consolidated statement of
financial position ............... 58,112 67,085 49,967 89,338
Net deferred tax liabilities recognised
in the consolidated statement of
financial position ............... 3,794 5,063 5,064 5,269
The Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Net deferred tax assets recognised in
the statement of financial position .. 51,311 55,348 37,370 74,264
As at December 31, 2022, 2023, and 2024 and October 31, 2025, the Group had unutilised
tax losses of approximately RMB29,309,000, RMB60,522,000, RMB87,673,000 and
RMB129,297,000, which will expire in one to ten years for offsetting against future taxable
profits. As at December 31, 2023, and 2024 and October 31, 2025, the Group did not recognise
deferred tax assets in respect of the deductible temporary differences of RMB38,734,000,
RMB35,534,000, and RMB14,322,000. Due to the unpredictability of future profit streams, no
deferred tax assets had been recognised for the above unused tax losses and deductible temporary
differences.
APPENDIX I ACCOUNTANTS’ REPORT
– I-128 –


--- page 588 ---
35. SHARE CAPITAL
The Group and the Company
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Issued and fully paid: .............
Ordinary shares of RMB1.00 each .... 420,000 420,000 420,000 425,509
A summary of movements in the Company’s share capital is as follows:
Number of
shares in issue Share capital
’000 RMB’000
At January 1, 2022 ................................. 378,000 378,000
Issue of shares (note a) .............................. 42,000 42,000
At December 31, 2022, January 1, 2023, December 31, 2023,
January 1, 2024 and December 31, 2024 and January 1,
2025 .......................................... 420,000 420,000
Issue of shares (note b) .............................. 5,509 5,509
At October 31, 2025 ................................ 425,509 425,509
Notes:
(a) On February 16, 2022, the Company issued 42,000,000 shares under the initial public offering on the Shenzhen
Stock Exchange at a price of RMB76.56 per shares for net cash proceeds of RMB3,081,779,000. The amount of
RMB42,000,000 and RMB3,039,779,000 were credited to the Company’s share capital and share premium,
respectively.
(b) On May 28, 2025, the Company issued 5,509,152 shares upon the exercise of the vested share options granted
under the 2023 Restricted Share Incentive Scheme.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 589 ---
36. SHARE-BASED PAYMENT
Equity-Settled shared-based payment arrangement
(a) 2019 Share Incentive Scheme
Han’s Laser, the immediate holding company of the Group, approved the establishment of the
restricted shares incentive scheme for 2019 at the second extraordinary annual shareholders’
meeting (the “ 2019 Share Incentive Scheme ”) on September 11, 2019, with the purpose of
incentivizing the management members and core employees of Han’s Laser and the Group to
further promote the development and in recognition of their contributions. Under the 2019 Share
Incentive Scheme, 181 employees, officers and directors of the Group was granted with 6,597,188
shares of type II restricted shares of Han’s Laser. The grant date was September 11, 2019, and the
exercise price of RMB30.57 per share. The vesting periods for restricted shares granted are 1 year,
2 years and 3 years from 8 months after the grant date. According to the Company’s performance
appraisal and individual performance appraisal, 33%, 33% and 34% of restricted shares of Han’s
Laser will be vested respectively.
(b) 2023 Share Incentive Scheme
The Company approved the establishment of the restricted shares incentive scheme for 2023
at the second extraordinary annual shareholders’ meeting (the “ 2023 Share Incentive Scheme ”) on
December 8, 2023 with the purpose of incentivizing the management members and core employees
of the Group to further promote the development and in recognition of their contributions. Under
the 2023 Share Incentive Scheme, the Company granted 16,800,000 shares of type II restricted
shares of the Company to 388 employees, officers and directors on December 8, 2023, with an
exercise price of RMB19.38 per share. The vesting periods for restricted shares granted are 1 year,
2 years and 3 years from 4 months after the grant date. According to the Company’s performance
appraisal and individual performance appraisal, 33%, 33% and 34% of restricted shares plan will
be vested respectively.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 590 ---
(c) A summary of activities of the 2019 Share Incentive Scheme during the year ended December
31, 2022 is presented as follows:
Year ended December 31, 2022
Weighted average
exercise price per
share
Number of
options
RMB per share
At January 1 ..................................... 29.77* 2,271,356
Granted during the year .............................. ——
Forfeited during the year ............................ 29.77 (2,184,692)
Exercised during the year ............................ 29.77 (86,664)
At December 31 ................................... ——
* The exercise price of the share options of RMB29.77 has been adjusted for i) the distribution of cash dividend of
RMB2 per 10 shares in July 2020, ii) the distribution of cash dividend of RMB2 per 10 shares in May 2021, and
iii) the distribution of cash dividend of RMB4 per 10 shares in April 2022.
A summary of activities of the 2023 Share Incentive Scheme is presented as follows:
Year ended December 31, 2023 Year ended December 31, 2024
Weighted average
exercise price per
share Number of options
Weighted average
exercise price per
share Number of options
RMB per share RMB per share
At January 1 ...................... — — 19.38 16,800,000
Granted during the year ............... 19.38 16,800,000 — —
Forfeited during the year .............. — — 19.38 (77,100)
Exercised during the year .............. ————
At December 31 ................... 19.38 16,800,000 19.38 16,722,900
APPENDIX I ACCOUNTANTS’ REPORT
– I-131 –


--- page 591 ---
Ten months ended October 31, 2025
Weighted average
exercise price per
share Number of options
RMB per share
At January 1 ........................................ 19.38 16,722,900
Granted during the period ................................ ——
Forfeited during the period ............................... 18.98 (79,487)
Exercised during the period ............................... 18.98 & (5,509,152)
At October 31, ....................................... 18.98 11,134,261
& The exercise price of the share options of RMB18.98 has been adjusted for the distribution of cash dividend of
RMB4 per 10 shares in May 2025.
The weighted average share price at the date of exercise for share options exercised during
the Relevant Periods were RMB31.99, nil, nil and RMB38.32 per share, respectively.
The exercise prices and exercise periods of the share-based payments outstanding as at
December 31, 2023 and 2024 and October 31, 2025 are as follows:
December 31, 2023
Number of options Exercise price * Exercise period
RMB per share
5,544,000 19.38 April 2025−April 2026
5,544,000 19.38 April 2026−April 2027
5,712,000 19.38 April 2027−April 2028
16,800,000
December 31, 2024
Number of options Exercise price * Exercise period
RMB per share
5,518,557 19.38 April 2025−April 2026
5,518,557 19.38 April 2026−April 2027
5,685,786 19.38 April 2027−April 2028
16,722,900
APPENDIX I ACCOUNTANTS’ REPORT
– I-132 –


--- page 592 ---
October 31, 2025
Number of options Exercise price * Exercise period
RMB per share
5,484,039 18.98 April 2026−April 2027
5,650,222 18.98 April 2027−April 2028
11,134,261
* The exercise price of the share options is subject to adjustment in the case of rights or bonus share issues, or other
similar changes in the Company’s share capital.
The fair value at grant date is independently determined using an adjusted form of the Black
Scholes Model taking into account the terms and conditions upon which the options were granted.
The following table lists the inputs to the model used:
2023 Share Incentive Scheme
Exercise price per share ................................ RMB19.38
Expiry date ......................................... Respective annual due dates
Share price at grant date per share ........................ RMB37.05
Expected volatility of the Company’s shares ................ 18.36%−23.03%
Expected dividend yield ................................ 0%
Risk-free interest rate ................................. 1.50%−2.75%
The fair value of the share options granted during the year ended December 31, 2023 was
RMB315,020,000.
Share-based payment expenses
Share-based payment expenses during the Relevant Periods are as follows:
Year ended December 31,
Ten months
ended
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Equity-settled share-based payments .. (10,260) 12,736 152,071 82,092
APPENDIX I ACCOUNTANTS’ REPORT
– I-133 –


--- page 593 ---
37. RESERVES
The Group
The amounts of the Group’s reserves and the movements therein for the Relevant Periods are
presented in the consolidated statements of changes in equity.
(a) Share premium
The share premium of the Group represents the difference between the par value of the shares
issued and the consideration received.
(b) Share-based payment reserve
The share-based payment reserve represents the equity-settled share options as set out in note
36 to the Historical Financial Information.
(c) Other reserve
During the year ended December 31, 2023, the Group acquired additional equity interests in a
subsidiary from non-controlling shareholder at the consideration of RMB3,553,000. The difference
of RMB1,877,000 between the carrying value of the non-controlling interest and the consideration
paid was recorded as other reserve.
The other reserve arising on the decrease of share of net asset of an associate of the Group
due to the withdrawal of certain shareholders of the associate at a price higher than the share of
net assets as stipulated in the relevant investment agreements entered into between the associate
and the investors.
(d) Translation reserve
The Translation reserve comprises all foreign exchange differences arising from the
translation of the financial statements of companies of which the functional currencies are not
RMB. The reserve is dealt with in accordance with the accounting policy set out in note 2.3 to the
Historical Financial Information.
(e) Statutory reserve
In accordance with the Company Law of the PRC, companies registered in the PRC are
required to allocate 10% of the statutory after-tax profits to the statutory surplus reserve until the
cumulative total of the reserve reaches 50% of its registered capital. The statutory surplus reserve
may be used to offset accumulated losses or be converted to increase the registered capital of such
companies subject to approval from the relevant PRC authorities. The statutory surplus reserve is
not available for dividend distribution to shareholders of such companies.
APPENDIX I ACCOUNTANTS’ REPORT
– I-134 –


--- page 594 ---
The Company
The amounts of the Company’s reserves and the movements therein for the Relevant Periods
are presented as follows:
Capital
reserve
Share-based
payment
reserve
Other
reserve
Statutory
reserve
Retained
profits Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 36)
At January 1, 2022 .................. 1,015,103 20,664 190 100,111 750,995 1,887,063
Total comprehensive income for the year ..... ———— 457,454 457,454
Dividends declared .................. ———— (168,000) (168,000)
Issue of shares ..................... 3,039,779 ———— 3,039,779
Transfer of share option reserve upon the
forfeiture or expiry of share option ....... 12,220 (12,220) ————
Share-based payment compensation ........ — (8,444) — — — (8,444)
Transfer from retained profits ............ — — — 45,745 (45,745) —
At December 31, 2022 ................ 4,067,102 — 190 145,856 994,704 5,207,852
At January 1, 2023 .................. 4,067,102 — 190 145,856 994,704 5,207,852
Total comprehensive income for the year ..... ———— 284,442 284,442
Dividends declared .................. ———— (1,197,000) (1,197,000)
Share-based payment compensation ........ — 12,736 — — — 12,736
Transfer from retained profits ............ — — — 28,444 (28,444) —
At December 31, 2023 ................ 4,067,102 12,736 190 174,300 53,702 4,308,030
At January 1, 2024 .................. 4,067,102 12,736 190 174,300 53,702 4,308,030
Total comprehensive income for the year ..... ———— 294,524 294,524
Share-based payment compensation ........ — 152,071 — — — 152,071
Transfer from retained profits ............ — — — 29,452 (29,452) —
At December 31, 2024 ................ 4,067,102 164,807 190 203,752 318,774 4,754,625
At January 1, 2025 .................. 4,067,102 164,807 190 203,752 318,774 4,754,625
Total comprehensive income for the period .... ———— 357,380 357,380
Dividends declared .................. ———— (168,000) (168,000)
Exercise of share options .............. 198,490 (99,440) — — — 99,050
Share-based payment compensation ........ — 82,092 — — — 82,092
At October 31, 2025 ................. 4,265,592 147,459 190 203,752 508,154 5,125,147
APPENDIX I ACCOUNTANTS’ REPORT
– I-135 –


--- page 595 ---
38. PARTLY-OWNED SUBSIDIARY WITH MATERIAL NON-CONTROLLING
INTERESTS
Details of the Group’s subsidiary that has material non-controlling interests is set out below:
As at December 31,
As at
October 31,
2023 2024 2025
Percentage of equity interest held by
non-controlling interests:
Rayleigh Taide ...................... 30% 30% 30%
As at December 31,
As at
October 31,
2023 2024 2025
Profit/(loss) for the year/period allocated to
non-controlling interests:
Rayleigh Taide ...................... 1,291 (1,598) (436)
Accumulated balances of non-controlling
interests at the reporting date:
Rayleigh Taide ...................... 11,052 9,454 9,018
APPENDIX I ACCOUNTANTS’ REPORT
– I-136 –


--- page 596 ---
The following table illustrates the summarised financial information of the above subsidiary.
The amounts disclosed are before any inter-company eliminations:
Rayleigh Taide
As at December 31,
As at
October 31,
2023 2024 2025
RMB’000 RMB’000 RMB’000
Revenue ........................... 31,483 36,538 37,353
Total expenses ....................... 26,091 41,866 38,806
Profit/(loss) for the year/period .......... 5,392 (5,328) (1,453)
Total comprehensive income/(loss) for the
year/period ........................ 5,392 (5,328) (1,453)
Current assets ....................... 44,170 39,150 44,377
Non-current assets .................... 10,225 7,295 5,281
Current liabilities .................... 13,334 11,962 18,080
Non-current liabilities ................. 3,097 1,437 —
Net cash flows from/(used in) operating
activities ......................... 3,862 2,545 (6,107)
Net cash flows used in investing activities . (295) (31) (190)
Net cash flows used in financing activities . (957) (1,845) (1,537)
Effect of foreign exchange rate changes,
net ............................. 37 98 —
Net increase/(decrease) in cash and cash
equivalents ........................ 2,647 767 (7,834)
39. BUSINESS COMBINATION
On May 30, 2023, the Group acquired a 60% interest in Rayleigh Taide from an independent
third party at a cash consideration of RMB145,200,000. Rayleigh Taide is engaged in research,
manufacturing and trading of coating tools. The acquisition was made as part of the Group’s
strategy to expand its market share of industrial products. Upon completion of the acquisitions,
Rayleigh Taide became a subsidiary of the Group. Prior to the acquisition, the Group had 10%
interest in Rayleigh Taide accounted for as an interest in an associate using equity method. The
Group accordingly remeasured the fair value of its pre-existing interest in Rayleigh Taide at the
acquisition date and recognised the resulting gains of RMB15,360,000 in profit or loss.
APPENDIX I ACCOUNTANTS’ REPORT
– I-137 –


--- page 597 ---
Details of the carrying value and fair value of the Group’s pre-existing interest in Rayleigh
Taide at the acquisition date are summarised as follows:
2023
RMB’000
Fair value of pre-existing interest ................................... 18,615
Less: carrying amounts of the Group’s share of net assets .................. (3,255)
Gain on remeasurement of pre-existing interest in Rayleigh Taide ........... 15,360
The fair values of the identifiable assets and liabilities of Rayleigh Taide as at the date of
acquisition were as follows:
Notes
Fair value
recognised on
acquisition
RMB’000
Cash and cash equivalent ................................. 7,431
Trade and bills receivables ................................ 23,457
Prepayments, other receivables and other assets ................ 333
Inventories ............................................ 4,035
Property, plant and equipment .............................. 15 5,569
Right-of-use assets ...................................... 17(a) 174
Deferred tax assets ...................................... 34 281
Trade payables ......................................... (2,831)
Other payables and accruals ............................... (4,307)
Income tax payable ...................................... (1,428)
Lease liabilities ......................................... 17(b) (177)
Total identifiable net assets at fair value ...................... 32,537
Non-controlling interests .................................. (9,761)
Goodwill on acquisition .................................. 18 141,039
163,815
Satisfied by:
Cash ................................................. 76,517
Liabilities from contingent consideration ...................... 68,683
Fair value of remeasurement of pre-existing interest in Rayleigh
Taide classified as interest in an associate at the date of
acquisition ........................................... 18,615
163,815
APPENDIX I ACCOUNTANTS’ REPORT
– I-138 –


--- page 598 ---
The fair values of the trade receivables and other receivables as at the date of acquisition
amounted to RMB23,457,000 and RMB333,000, respectively. The gross contractual amounts of
trade and bills receivables and other receivables were RMB23,946,000 and RMB343,000,
respectively, of which trade and bills receivables of RMB489,000 and other receivables of
RMB10,000 are expected to be uncollectible.
As part of the purchase agreement, contingent consideration is payable, which is dependent
on the amount of profit before tax of Rayleigh Taide during the 2-year period subsequent to the
acquisition. The initial amount recognised was RMB68,683,000 which was determined using the
discounted cash flow model and is within Level 3 fair value measurement. The consideration is
due for final measurement and payment to the former shareholders on December 31, 2025.
An analysis of the cash flows in respect of the acquisition of a subsidiary during the year
ended December 31, 2023 is as follows:
RMB’000
Cash consideration ............................................... 76,517
Cash and bank balances acquired .................................... (7,431)
Net outflow of cash and cash equivalents included in cash flows from
investing activities ............................................ 69,086
Since the acquisition, Rayleigh Taide contributed revenue of RMB30,695,000 and the profit
of RMB5,537,000 to the Group for the period from the acquisition date to December 31, 2023.
Had the combination taken place at the beginning of the year ended December 31, 2023, the
revenue and the profit of the Group for the year would have been RMB1,657,140,000 and
RMB141,164,000, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-139 –


--- page 599 ---
40. NOTES TO THE CONSOLIDATED STATEMENTS OF CASH FLOWS
(a) Major non-cash transactions
During the Relevant Periods and ten months ended October 31, 2024, the Group had non-cash
additions to right-of-use assets of RMB42,178,000, RMB8,077,000, RMB4,923,000,
RMB17,763,000 and RMB4,923,000 (unaudited) and non-cash additions to lease liabilities of
RMB42,178,000, RMB8,077,000, RMB4,923,000, RMB17,763,000 and RMB4,923,000
(unaudited), respectively, in respect of lease arrangements for buildings.
During the Relevant Periods and ten months ended October 31, 2024, the Group had non-cash
reduction to trade and bills receivables of RMB32,228,000, RMB18,636,000, RMB3,830,000,
RMB4,500,000, and RMB3,593,000 (unaudited) and non-cash reduction to interest-bearing
borrowings of RMB32,228,000, RMB18,636,000, RMB3,830,000, RMB4,500,000, and
RMB3,593,000 (unaudited), respectively, in respect of bills receivables discounted that are not
derecognised in their entirety.
During the Relevant Periods and ten months ended October 31, 2024, the Group had non-cash
reduction to trade and bills receivables of RMB303,233,000, RMB380,377,000, RMB695,221,000,
RMB905,836,000 and RMB469,671,000 (unaudited) and non-cash reduction to other payables of
RMB303,233,000, RMB380,377,000, RMB695,221,000, RMB905,836,000 and RMB469,671,000
(unaudited), respectively, in respect of bills receivables endorsed that are not derecognised in their
entirety.
During the ten months ended October 31, 2025, the Group reclassified trade payables of
RMB27,727,000 to interest-bearing borrowings in respect of the supplier finance arrangements
(note 32).
APPENDIX I ACCOUNTANTS’ REPORT
– I-140 –


--- page 600 ---
(b) Changes in liabilities arising from financing activities
Interest-bearing
borrowings Lease liabilities Total
RMB’000 RMB’000 RMB’000
At January 1, 2022 ................... 641,370 132,634 774,004
Changes from financing cash flows ....... (602,534) (45,259) (647,793)
Derecognition of discounted bills
receivables upon their maturity ........ (32,228) — (32,228)
New lease addition ................... — 42,178 42,178
Accretion of interest .................. 10,566 6,410 16,976
Lease termination .................... — (7,493) (7,493)
At December 31, 2022 and January 1,
2023 ............................ 17,174 128,470 145,644
Changes from financing cash flows ....... 75,357 (44,707) 30,650
Derecognition of discounted bills
receivables upon their maturity ........ (18,636) — (18,636)
New lease addition ................... — 8,077 8,077
Increase arising from acquisition of a
subsidiary (note 39) ................. — 177 177
Accretion of interest .................. 1,849 4,789 6,638
Lease termination .................... — (16,298) (16,298)
At December 31, 2023 and January 1,
2024 ............................ 75,744 80,508 156,252
Changes from financing cash flows ....... 134,542 (39,244) 95,298
Derecognition of discounted bills
receivables upon their maturity ........ (3,830) — (3,830)
New lease addition ................... — 4,923 4,923
Accretion of interest .................. 7,020 3,041 10,061
Lease termination .................... — (1,714) (1,714)
At December 31, 2024 and January 1,
2025 ............................ 213,476 47,514 260,990
Changes from financing cash flows ....... 577,215 (31,675) 545,540
Derecognition of discounted bills
receivables upon their maturity ........ (4,500) — (4,500)
New lease addition ................... — 17,763 17,763
Accretion of interest ................. 11,937 1,533 13,470
Increase arising from supplier finance
arrangements ...................... 27,727 — 27,727
Lease termination .................... — (874) (874)
At October 31, 2025 .................. 825,855 34,261 860,116
APPENDIX I ACCOUNTANTS’ REPORT
– I-141 –


--- page 601 ---
Interest-bearing
borrowings Lease liabilities Total
RMB’000 RMB’000 RMB’000
At December 31, 2023 and
January 1, 2024 .................... 75,744 80,508 156,252
Changes from financing cash flows
(unaudited) ....................... (28,081) (33,437) (61,518)
Derecognition of discounted bills
receivables upon their maturity
(unaudited) ....................... (3,593) — (3,593)
New lease addition (unaudited) .......... — 4,923 4,923
Accretion of interest (unaudited) ......... 6,582 2,506 9,088
Lease termination (unaudited) .......... — (774) (774)
At October 31, 2024 (unaudited) ......... 50,652 53,726 104,378
(c) Total cash outflow for leases
The total cash outflow for leases included in the statement of cash flows is as follows:
As at December 31, As at October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Within operating
activities .......... 20,517 15,585 18,075 15,724 23,428
Within financing
activities .......... 50,864 49,650 40,756 34,949 37,584
71,381 65,235 58,831 50,673 61,012
APPENDIX I ACCOUNTANTS’ REPORT
– I-142 –


--- page 602 ---
41. CONTINGENT LIABILITIES
Outstanding letters of guarantee
The Group had the following outstanding letters of guarantee issued by banks at the end of
each of the Relevant Periods:
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Outstanding letters of guarantee ..... 25,507 25,507 35,507 45,507
42. PLEDGE OF ASSETS
As at December 31, 2022, 2023 and 2024 and October 31, 2025, the Group had no pledge of
assets.
43. COMMITMENTS
The Group had the following contractual commitments at the end of the Relevant Periods:
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Acquisition of property, plant and
equipment and other non-current
assets ........................ 57,990 244,689 139,668 118,431
APPENDIX I ACCOUNTANTS’ REPORT
– I-143 –


--- page 603 ---
44. RELATED PARTY TRANSACTIONS
(a) Names and relationships
Name of related parties Relationship with the Group
Han’s Laser Technology Industry Group Co., Ltd.
(note (i))ʮ̡ .......
The immediate holding company
Mr. Gao Yunfengࢤ.......................... The ultimate controlling person
Mr. Yang Chaohui เಃሾ ......................... Director and General Manager of the
Company
Shenzhen Han’s Motor Technology Co., Ltd. (note (i))
ʮ̡ ....................
Controlled by the immediate holding
company
Han’s Tiancheng Semiconductor Co., Ltd. (note (i)) ̏ԯ
ʮ̡ ....................
An associate of the immediate
holding company
GYX Optoelectronics Co., Ltd. (note (i))Έཥ
ʮ̡ .............................
Controlled by the immediate holding
company
Han’s Laser Intelligent Equipment Group Co., Ltd.
(note (i))ʮ̡ ...........
Controlled by the immediate holding
company
Shenzhen Han’s Super Energy Laser Technology Co., Ltd.
(note (i))ʮ̡ ........
Controlled by the immediate holding
company
Guangdong Yueming Intelligent Equipment Co., Ltd.
(note (i))ʮ̡ ...........
Controlled by the immediate holding
company
Shenzhen Han’s Smart Tech Co., Ltd. (note (i))ܠ
ʮ̡ (ҦϞ
ʮ̡)* ....................................
Controlled by the immediate holding
company
* Pursuant to relevant regulatory requirement governing disclosure of related party transactions, Shenzhen Han’s Smart
Tech Co., Ltd. was still regarded as a related party of the Group in the following twelve months up to February 2025
after its cessation as an subsidiary of Han’s Laser in February 2024. Therefore, the amount of related party
transactions with Shenzhen Han’s Smart Tech Co., Ltd. during the Relevant Period covered from February 2024 to
February 2025, and the balance of transactions as at October 31, 2025 will no longer be presented.
APPENDIX I ACCOUNTANTS’ REPORT
– I-144 –


--- page 604 ---
Name of related parties Relationship with the Group
Shenzhen Han’s Property Management Co., Ltd.
(note (i))ʮ̡ .............
Controlled by the ultimate
controlling person
Dazu Holdings Group Co., Ltd. (note (i))
ʮ̡ ..........................
The parent company of the
immediate holding company
HAN’S LASER TECHNOLOGY CO., LIMITED.
(note (i))ʮ̡ ..............
Controlled by the immediate holding
company
Shenzhen Han’s Cloud Technology Co., Ltd. (note (i))
ʮ̡ ....................
Controlled by the immediate holding
company
Shenzhen Han’s Vision Technology Co., Ltd. (note (i))
ʮ̡ ....................
Controlled by the immediate holding
company
Shenzhen Hansheng Refrigeration Technology Co., Ltd.
(note (i))ʮ̡ .............
Controlled by the immediate holding
company
Guangdong Huayan Robot Co., Ltd. (Former Name:
Shenzhen Han’s Robot Co., Ltd.) (note (i))
ʮ̡ (ಀ͜Τjଉέ̹ɽૄዚኜɛ
ʮ̡) ....................................
An associate of the parent company
Zhejiang Guoyexing Intelligent Manufacturing Technology
Co., Ltd. (note (i))ʮ̡ .....
Controlled by the immediate holding
company
Shenzhen Han’s HGC Laser Technology Co., Ltd.
(note (i))ʮ̡ .............
Controlled by the immediate holding
company
Dongguan Han Chuan Technology Co., Ltd. Shenzhen
Branch (note (i))ʮ̡ଉέʱʮ̡ .
Controlled by the immediate holding
company
Shenzhen Han’s Intelligent Control Technology Co., Ltd.
(note (i))ʮ̡ .........
Controlled by the immediate holding
company
Tianjin Tiancheng Optoelectronic Technology Co., Ltd.
(note (i))ʮ̡ ...........
An associate of the parent company
Han’s Laser E-Commerce Trade (Shenzhen) Co., Ltd.
(note (i))׸( ଉέ)ʮ̡ ......
Controlled by the immediate holding
company
APPENDIX I ACCOUNTANTS’ REPORT
– I-145 –


--- page 605 ---
Name of related parties Relationship with the Group
Shenzhen Han’s Machine Tool Technology Co., Ltd.
(note (i))ʮ̡ .............
Controlled by the immediate holding
company
Shenzhen Han’s Semiconductor Equipment Technology
Co., Ltd. (note (i))Ҧ
ʮ̡ ....................................
Controlled by the immediate holding
company
Yancheng Han’s Machine Tool Technology Co., Ltd.
(note (i))ʮ̡ .............
Controlled by the immediate holding
company
Shenzhen Mingxin (note (i))ڦ׼................ An associate
HANS HIGH-TECH SINGAPORE PTE. LTD .......... Controlled by the immediate holding
company
Shenzhen Yue’an Elevator Engineering Co., Ltd (note (i))
ʮ̡ ....................
Controlled by the ultimate
controlling person
Note:
(i) The names of the companies represent management’s best efforts at translating the Chinese names of these
companies, as no English names have been registered or available.
APPENDIX I ACCOUNTANTS’ REPORT
– I-146 –


--- page 606 ---
(b) Significant related party transactions
In addition to the transactions detailed elsewhere in the Historical Financial Information, the
Group had the following material related party transactions during the Relevant Periods and the
ten months ended October 31, 2024:
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Revenue from goods and services
Han’s Laser Technology Industry
Group Co., Ltd. .............. 7,329 2,255 884 872 1,216
Shenzhen Mingxin .............. 11 249 14 14 27
Guangdong Huayan Robot Co., Ltd. . 6 0—3 83 8—
Shenzhen Han’s Smart Tech Co.,
Ltd. ....................... —3 0———
Shenzhen Hansheng Refrigeration
Technology Co., Ltd. .......... —2 7———
Shenzhen Han’s Machine Tool
Technology Co., Ltd. .......... —1 13 31 18 8
Shenzhen Han’s Semiconductor
Equipment Technology Co., Ltd. .. —9 1———
Yancheng Han’s Machine Tool
Technology Co., Ltd. .......... ——1 31 1—
HANS HIGH-TECH SINGAPORE
PTE. LTD. .................. ———— 4 , 0 3 8
Zhejiang Guoyexing Intelligent
Manufacturing Technology Co.,
Ltd. ....................... ———— 1
Total ........................ 7,400 2,663 982 946 5,370
APPENDIX I ACCOUNTANTS’ REPORT
– I-147 –


--- page 607 ---
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Purchase of goods and services
Han’s Laser Technology Industry
Group Co., Ltd. .............. 12,841 13,586 15,253 12,867 15,340
Han’s Motor Technology Co., Ltd. .. 37,226 20,689 14,445 12,683 23,469
Han’s Tiancheng Semiconductor
Co., Ltd. .................... 30,981 2,177 1,850 1,801 —
GYX Optoelectronics Co., Ltd. .... 1,056 1,278 841 816 13
Shenzhen Han’s Super Energy Laser
Technology Co., Ltd. .......... 555 — 239 239 —
Shenzhen Han’s Smart Tech Co.,
Ltd. ....................... 626 747 795 795 312
Guangdong Yueming Intelligent
Equipment Co., Ltd. ........... —— * ———
Han’s Laser Intelligent Equipment
Group Co., Ltd. .............. 4 9 —22 —
Shenzhen Han’s Property
Management Co., Ltd. ......... 9,299 9,210 8,515 7,098 7,355
Shenzhen Han’s Cloud Technology
Co., Ltd. .................... 30 56 24 24 1
Shenzhen Han’s Vision Technology
Co., Ltd. .................... 1 2 7 1 1 24 94 9— *
Shenzhen Hansheng Refrigeration
Technology Co., Ltd. .......... 8,532 6,292 8,194 6,953 8,508
Guangdong Huayan Robot Co., Ltd. . 53 187 200 76 1,244
Zhejiang Guoyexing Intelligent
Manufacturing Technology Co.,
Ltd. ....................... 107 155 338 178 1,032
Shenzhen Han’s HGC Laser
Technology Co., Ltd. .......... — * ————
Dongguan Han Chuan Technology
Co., Ltd. Shenzhen Branch ...... 138 189 74 73 29
Shenzhen Han’s Intelligent Control
Technology Co., Ltd. .......... 2 8————
Tianjin Tiancheng Optoelectronic
Technology Co., Ltd. .......... — 3,000 18,255 15,604 26,941
APPENDIX I ACCOUNTANTS’ REPORT
– I-148 –


--- page 608 ---
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Han’s Laser E-Commerce Trade
(Shenzhen) Co., Ltd. ........... — 3 28 28 12
Shenzhen Yue’an Elevator
Engineering Co., Ltd .......... ————3 1
Total ........................ 101,648 57,681 69,102 59,286 84,287
* Amount less than RMB1,000.
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Expense relating to short-term
lease and low-value assets
Han’s Laser Technology Industry
Group Co., Ltd. .............. 3,607 1,813 1,817 1,585 2,506
Han’s Laser Technology Co., Ltd. .. 49 52 53 44 44
Total ........................ 3,656 1,865 1,870 1,629 2,550
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Addition of right-of-use assets
Han’s Laser Technology Industry
Group Co., Ltd. .............. 3 0 , 7 3 6————
APPENDIX I ACCOUNTANTS’ REPORT
– I-149 –


--- page 609 ---
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Interest on lease liabilities
Han’s Laser Technology Industry
Group Co., Ltd. .............. 5,189 4,467 2,559 2,234 1,083
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Purchase of property, plant and
equipment
Shenzhen Han’s Cloud Technology
Co., Ltd. .................... 1 2 5————
Shenzhen Han’s Motor Technology
Co., Ltd. .................... ————8 8
Total ........................ 125 — — — 88
Year ended December 31,
Ten months ended
October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Purchase of engineering
management services
Dazu Holdings Group Co., Ltd. .... 2,901 8,429 274 274 —
Notes:
(i) The directors of the Company are of the opinion that the above sales to related parties and purchase from related
parties were conducted in the ordinary course of business and on arms-length commercial terms.
(ii) During the Relevant Periods and the ten months ended October 31, 2024, the Company used the trademark of Han’s
Laser Technology Industry Group Co., Ltd. free of charge.
APPENDIX I ACCOUNTANTS’ REPORT
– I-150 –


--- page 610 ---
(c) Outstanding balances with related parties:
The Group had the following outstanding balances with related parties:
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade related
Trade and bills receivables
Han’s Laser Technology Industry
Group Co., Ltd. ................ 538 906 826 743
Shenzhen Mingxin ............... 43 9——
Shenzhen Han’s Machine Tool
Technology Co., Ltd. ............ — — 24 61
Yancheng Han’s Machine Tool
Technology Co., Ltd. ............ —— 2—
Total .......................... 542 945 852 804
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade related
Contract assets
Han’s Laser Technology Industry
Group Co., Ltd. ................ — 1 6 7——
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade related
Other receivables
Han’s Laser Technology Industry
Group Co., Ltd. ................ 5,456 4,510 3,326 1,849
Shenzhen Mingxin ................ — 125 119 119
Total .......................... 5,456 4,635 3,445 1,968
APPENDIX I ACCOUNTANTS’ REPORT
– I-151 –


--- page 611 ---
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade related
Trade and bills payables
Shenzhen Han’s Motor Technology
Co., Ltd. ..................... 64,967 31,468 19,974 23,413
Han’s Laser Technology Industry
Group Co., Ltd. ................ 2,906 3,223 6,361 5,010
Han’s Tiancheng Semiconductor
Technology Co., Ltd. ............ 24,959 441 128 —
GYX Optoelectronics Co., Ltd. ...... 699 991 218 —
Shenzhen Han’s Vision Technology
Co., Ltd. ..................... 127 77 — —
Shenzhen Han’s Smart Tech Co., Ltd. . 398 600 299 198
Han’s Laser Intelligent Equipment
Group Co., Ltd. ................ 3 4———
Shenzhen Han’s Super Energy Laser
Technology Co., Ltd. ............ 627 — 270 —
Shenzhen Han’s Cloud Technology
Co., Ltd. ..................... 91 63 — —
Zhejiang Guoyexing Intelligent
Manufacturing Technology Co.,
Ltd. ......................... 109 3 266 162
Shenzhen Hansheng Refrigeration
Technology Co., Ltd. ............ 5,709 5,129 6,629 7,222
Shenzhen Han’s HGC Laser
Technology Co., Ltd. ............ —— * ——
Dongguan Han Chuan Technology
Co., Ltd. Shenzhen Branch ....... 138 146 70 7
Shenzhen Han’s Intelligent Control
Technology Co., Ltd. ............ 3 1———
Guangdong Huayan Robot Co., Ltd. .. — 197 311 924
Tianjin Tiancheng Optoelectronic
Technology Co., Ltd ............ — 1,317 18,934 28,011
Dazu Holdings Group Co., Ltd. ...... — 8 , 4 2 9——
Total .......................... 100,795 52,084 53,460 64,947
* Amount less than RMB1,000.
APPENDIX I ACCOUNTANTS’ REPORT
– I-152 –


--- page 612 ---
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade related
Other payables
Han’s Laser Technology Industry
Group Co., Ltd. ................ — 12 — 519
Shenzhen Han’s Property Management
Co., Ltd. ..................... — 1——
Shenzhen Mingxin ............... —— * ——
Shenzhen Han’s Motor Technology
Co., Ltd. ..................... — — 1,528 448
GYX Optoelectronics Co., Ltd. ...... — — 257 —
Shenzhen Hansheng Refrigeration
Technology Co., Ltd. ............ — — 921 779
Shenzhen Han’s Smart Tech Co., Ltd. . — — 370 —
Total .......................... — 13 3,076 1,746
* Amount less than RMB1,000.
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Trade related
Lease liabilities
Han’s Laser Technology Industry
Group Co., Ltd. ................ 109,410 69,991 39,420 14,830
APPENDIX I ACCOUNTANTS’ REPORT
– I-153 –


--- page 613 ---
(d) Compensation of key management personnel of the Group:
Year ended December 31, Ten months ended October 31,
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Salaries, bonuses,
allowances and
benefits in kind ..... 12,889 11,645 14,577 6,836 7,209
Pension scheme
contributions ....... 610 657 663 552 585
Share-based payment
compensation ...... (4,245) 4,981 59,768 49,807 32,685
Total compensation
paid to key
management
personnel ......... 9,254 17,283 75,008 57,195 40,479
Further details of directors’ and the supervisors’ emoluments are included in note 10 to the
Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-154 –


--- page 614 ---
45. FINANCIAL INSTRUMENTS BY CATEGORY
The carrying amounts of each of the categories of financial instruments as at the end of each
of the Relevant Periods are as follows:
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
Financial assets at fair value through
other comprehensive income:
Trade and bills receivables ......... 55,119 51,188 89,416 51,896
Financial assets at amortised cost:
Trade and bills receivables — current . 2,093,956 1,643,601 2,586,730 4,121,727
Trade and bills receivables —
non-current ................... 118,624 60,913 170,002 513,566
Financial assets included in
prepayments, other receivables and
other assets ................... 13,116 10,961 19,063 20,443
Restricted cash .................. — 1,816 333 542
Cash and cash equivalents .......... 2,986,535 1,916,965 1,539,131 1,146,344
Time deposits ................... — — 400,000 417,114
5,212,231 3,634,256 4,715,259 6,219,736
Financial liabilities
Financial liabilities at fair value
through profit or loss:
Liabilities from contingent
consideration ................. — 68,683 8,523 —
Financial liabilities at amortised cost:
Trade and bills payables ........... 671,476 592,018 1,275,637 2,244,899
Financial liabilities included in other
payables and accruals ........... 161,989 156,397 216,309 325,192
Interest-bearing borrowing .......... 17,174 75,744 213,476 825,855
850,639 824,159 1,705,422 3,395,946
APPENDIX I ACCOUNTANTS’ REPORT
– I-155 –


--- page 615 ---
46. FAIR V ALUE AND FAIR V ALUE HIERARCHY OF FINANCIAL INSTRUMENTS
The carrying amounts and fair values of the Group’s financial instruments, other than those
with carrying amounts that reasonably approximate to fair values, are as follows:
As at December 31, 2022
Carrying amounts Fair values
RMB’000 RMB’000
Financial assets
Trade and bills receivables measured at fair value through
other comprehensive income ........................ 55,119 55,119
Financial liabilities
Interest-bearing borrowing ............................ 17,174 17,174
As at December 31, 2023
Carrying amounts Fair values
RMB’000 RMB’000
Financial assets
Trade and bills receivables measured at fair value through
other comprehensive income ........................ 51,188 51,188
Financial liabilities
Liabilities from contingent consideration ................. 68,683 68,683
Interest-bearing borrowing ........................... 75,744 75,744
144,427 144,427
APPENDIX I ACCOUNTANTS’ REPORT
– I-156 –


--- page 616 ---
As at December 31, 2024
Carrying amounts Fair values
RMB’000 RMB’000
Financial assets
Trade and bills receivables measured at fair value through
other comprehensive income ........................ 89,416 89,416
Financial liabilities
Liabilities from contingent consideration ................. 8,523 8,523
Interest-bearing borrowing ............................ 213,476 208,913
221,999 217,436
As at October 31, 2025
Carrying amounts Fair values
RMB’000 RMB’000
Financial assets
Trade and bills receivables measured at fair value through
other comprehensive income ........................ 51,896 51,896
Financial liabilities
Interest-bearing borrowing ............................ 825,855 819,969
Management has assessed that the fair values of cash and cash equivalents, restricted cash,
time deposits, trade and bills receivables at amortised cost, trade and bills payables, financial
assets included in prepayments, other receivables and other assets, financial liabilities included in
other payables and accruals and lease liabilities approximate to their carrying amounts largely due
to the short term maturities of these instruments. For deposits, Management has assessed that their
fair value is equal to their book value, mainly because these deposits are collateral for bills and the
fair value fluctuates less and the maturity is short.
The carrying amounts of the Group’s financial instruments including time deposits were not
materially different from their fair values as at December 31, 2022, 2023 and 2024 and October
31, 2025.
APPENDIX I ACCOUNTANTS’ REPORT
– I-157 –


--- page 617 ---
The Group’s finance department headed by the financial director is responsible for
determining the policies and procedures for the fair value measurement of financial instruments. At
the end of each of the Relevant Periods, the finance department analyses the movements in the
values of financial instruments and determines the major inputs applied in the valuation. The
directors review the results of the fair value measurement of financial instruments periodically for
financial reporting.
The fair values of the financial assets and liabilities are included at the amount at which the
instrument could be exchanged in a transaction between willing parties, other than in a forced or
liquidation sale. The following methods and assumptions were used to estimate the fair values:
The fair values of the non-current portion of interest-bearing bank and other borrowings and
bond payable have been calculated by discounting the expected future cash flows using rates
currently available for instruments with similar terms, credit risk and remaining maturities. The
changes in fair value as a result of the Group’s own non-performance risk for interest-bearing bank
and other borrowings as at the end of each of the Relevant Periods were assessed to be
insignificant.
The financial instruments in bills receivables are the bank acceptance bills registered by the
acceptance bank with high credit, and the Group’s management model aims at both collecting the
contractual cash flow and selling the financial assets. There is no significant unobservable inputs
to the valuation of financial instruments as at December 31, 2022, 2023 and 2024 and October 31,
2025.
APPENDIX I ACCOUNTANTS’ REPORT
– I-158 –


--- page 618 ---
Fair value hierarchy
The following tables illustrate the fair value measurement hierarchy of the Group’s financial
instruments:
Financial instruments measured at fair value:
As at December 31, 2022
Fair value measurement using
Quoted prices
in active
markets
(Level 1)
Significant
observable
inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
Trade and bills receivables measured
at fair value through other
comprehensive income ........... — 55,119 — 55,119
As at December 31, 2023
Fair value measurement using
Quoted prices
in active
markets
(Level 1)
Significant
observable
inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
Trade and bills receivables measured
at fair value through other
comprehensive income .......... — 51,188 — 51,188
Financial liabilities
Liabilities from contingent
consideration ................. — — 68,683 68,683
APPENDIX I ACCOUNTANTS’ REPORT
– I-159 –


--- page 619 ---
As at December 31, 2024
Fair value measurement using
Quoted prices
in active
markets
(Level 1)
Significant
observable
inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
Trade and bills receivables measured
at fair value through other
comprehensive income .......... — 89,416 — 89,416
Financial liabilities
Liabilities from contingent
consideration ................. — — 8,523 8,523
As at October 31, 2025
Fair value measurement using
Quoted prices
in active
markets
(Level 1)
Significant
observable
inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
Trade and bills receivables measured
at fair value through other
comprehensive income .......... — 51,896 — 51,896
During the Relevant Periods, there were no transfers of fair value measurements between
Level 1 and Level 2 and no transfers into or out of Level 3 for financial assets.
APPENDIX I ACCOUNTANTS’ REPORT
– I-160 –


--- page 620 ---
The following table demonstrates a sensitivity analysis of discount rate, reflecting the impact
on the fair value of the payable for acquisition of Rayleigh Taide of a reasonable and probable
change in discount rate, assuming other variables are constant. There were no significant
inter-relationships between unobservable inputs that materially affect fair value as at December 31,
2023 and 2024.
Increase/(decrease)
in basis points of
discount rate
(Decrease)
/increase the fair
value payable for
acquisition of
Rayleigh Taide by
RMB’000
Year ended December 31, 2023
RMB ............................................ 50 (654)
RMB ............................................ (50) 531
Year ended December 31, 2024
RMB ............................................ 50 (14)
RMB ............................................ (50) 14
47. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group’s principal financial instruments comprise cash and cash equivalents, restricted
cash, trade and bills receivables, trade and bills payables, financial assets included in prepayments,
other receivables and other assets, time deposits, financial liabilities included in other payables
and accruals, interest-bearing borrowings and lease liabilities. The main purpose of these financial
instruments is to raise finance for the Group’s operations. The Group has various other financial
assets and liabilities such as trade and bills receivables and trade and bill payables, which arise
directly from its operations.
The main risks arising from the Group’s financial instruments are interest rate risk, foreign
currency risk, credit risk and liquidity risk. The board of directors reviews and agrees policies for
managing each of these risks.
Interest rate risk
Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. The Group’s exposure to the risk of changes in market
interest rates relates primarily to the Group’s non-current interest-bearing bank borrowings.
APPENDIX I ACCOUNTANTS’ REPORT
– I-161 –


--- page 621 ---
The following table demonstrates a sensitivity analysis of interest rate risk, reflecting the
impact on net profit or loss (through the impact on floating rate borrowings) of a reasonable and
probable change in interest rates, assuming other variables are constant.
Increase/(decrease)
in basis points
(Decrease)
/increase in
net profit
RMB’000
Year ended December 31, 2024
RMB ............................................ 50 (134)
RMB ............................................ (50) 134
Ten months ended October 31, 2025
RMB ............................................ 50 (132)
RMB ............................................ (50) 132
Foreign currency risk
Foreign currency risk is the risk of loss resulting from changes in foreign currency exchange
rates. Fluctuations in exchange rates between RMB and other currencies in which the Group
conducts business may affect the Group’s financial condition and results of operations.
The following table demonstrates the sensitivity at the end of each of the Relevant Periods to
a reasonably possible change in foreign currency exchange rates, with all other variables held
constant, of the Group’s loss before tax (due to changes in the translated value of monetary assets
and liabilities).
Increase/
(decrease) in
exchange rates of
foreign currency
Increase/
(decrease) in
profit before tax
% RMB’000
Year ended December 31, 2022
If RMB strengthens against USD ...................... 50 10
If RMB weakens against USD ......................... (50) (10)
If RMB strengthens against HKD ...................... 50 27
If RMB weakens against HKD ........................ (50) (27)
If RMB strengthens against Euro (“ EUR”) ............... 50 (83)
If RMB weakens against EUR ......................... (50) 83
APPENDIX I ACCOUNTANTS’ REPORT
– I-162 –


--- page 622 ---
Increase/
(decrease) in
exchange rates of
foreign currency
Increase/
(decrease) in
profit before tax
% RMB’000
Year ended December 31, 2023
If RMB strengthens against USD ...................... 50 30
If RMB weakens against USD ......................... (50) (30)
If RMB strengthens against HKD ...................... 50 70
If RMB weakens against HKD ........................ (50) (70)
If RMB strengthens against EUR ...................... 50 (12)
If RMB weakens against EUR ......................... (50) 12
Year ended December 31, 2024
If RMB strengthens against USD ...................... 50 100
If RMB weakens against USD ......................... (50) (100)
If RMB strengthens against HKD ...................... 50 41
If RMB weakens against HKD ........................ (50) (41)
If RMB strengthens against EUR ...................... 50 (18)
If RMB weakens against EUR ......................... (50) 18
Ten months ended October 31, 2025
If RMB strengthens against USD ...................... 50 271
If RMB weakens against USD ......................... (50) (271)
If RMB strengthens against HKD ...................... 50 (22)
If RMB weakens against HKD ........................ (50) 22
If RMB strengthens against EUR ...................... 50 (108)
If RMB weakens against EUR ......................... (50) 108
Credit risk
The Group trades only with recognised and creditworthy parties. It is the Group’s policy that
all customers who wish to trade on credit terms are subject to credit verification procedures.
For other receivables and other assets, management makes periodic collective assessment as
well as individual assessment on the recoverability of other receivables based on historical
settlement records and past experience. The Directors believe that there is no material credit risk
inherent in the Group’s outstanding balance of other receivables.
APPENDIX I ACCOUNTANTS’ REPORT
– I-163 –


--- page 623 ---
Maximum exposure and year-end staging as at December 31, 2022, 2023 and 2024 and
October 31, 2025
The tables below show the credit quality and the maximum exposure to credit risk based on
the Group’s credit policy, which is mainly based on past due information unless other information
is available without undue cost or effort, and year-end staging classification as at the end of each
of the Relevant Periods.
The amounts presented are gross carrying amounts for financial assets.
As at December 31, 2022
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Trade and bill receivables* .. 55,119 — — 2,311,444 2,366,563
Contract asset* ......... — — — 20,114 20,114
Financial assets included in
prepayments, other
receivables and other
assets
— Normal** .......... 14,156 — — — 14,156
Cash and cash equivalents .. 2,986,535 — — — 2,986,535
3,055,810 — — 2,331,558 5,387,368
APPENDIX I ACCOUNTANTS’ REPORT
– I-164 –


--- page 624 ---
As at December 31, 2023
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Trade and bill receivables* .. 51,188 — — 1,820,018 1,871,206
Contract asset* ......... — — — 20,282 20,282
Financial assets included in
prepayments, other
receivables and other
assets
— Normal** .......... 13,390 — — — 13,390
Restricted cash ......... 1,816 — — — 1,816
Cash and cash equivalents .. 1,916,965 — — — 1,916,965
1,983,359 — — 1,840,300 3,823,659
As at December 31, 2024
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Trade and bill receivables* .. 89,416 — — 2,894,336 2,983,752
Contract asset* ......... — — — 25,705 25,705
Financial assets included in
prepayments, other
receivables and other
assets
— Normal** .......... 22,451 — — — 22,451
Restricted cash ......... 3 3 3——— 3 3 3
Cash and cash equivalents .. 1,539,131 — — — 1,539,131
Time deposits ......... 400,000 — — — 400,000
2,051,331 — — 2,920,041 4,971,372
APPENDIX I ACCOUNTANTS’ REPORT
– I-165 –


--- page 625 ---
As at October 31, 2025
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Trade and bill receivables* . 51,896 — — 4,796,628 4,848,524
Contract asset* ......... — — — 47,048 47,048
Financial assets included in
prepayments, other
receivables and other
assets
— Normal** .......... 25,950 — — — 25,950
Restricted cash ......... 5 4 2——— 5 4 2
Cash and cash equivalents .. 1,146,344 — — — 1,146,344
Time deposits ......... 417,114 — — — 417,114
1,641,846 — — 4,843,676 6,485,522
* For contract assets and trade and bills receivables to which the Group applies the simplified approach for
impairment, information is disclosed in note 22 to the Historical Financial Information.
** The credit quality of the financial assets included in prepayments, other receivables and other assets is considered
to be “normal” when they are not past due and there is no information indicating that the financial assets had a
significant increase in credit risk since initial recognition. Otherwise, the credit quality of the financial assets is
considered to be “doubtful”.
Further quantitative data in respect of the Group’s exposure to credit risk arising from trade
and bills receivables and contract assets are disclosed in notes 22 and 24 to the Historical
Financial Information.
Since the Group trades only with recognised and creditworthy third parties, there is no
requirement for collateral. Concentrations of credit risk are managed by customer/counterparty, by
geographical region and by industry sector. As at December 31, 2022, 2023 and 2024 and October
31, 2025, the Group had certain concentrations of credit risk as 9.4%, 10.7%, 6.1% and 10.9% of
the Group’s trade and bills receivables and contract assets were due from the Group’s largest
customer. 34.4%, 30.7%, 19.4% and 24.9% of the Group’s trade and bills receivables and contract
assets were due from five largest customers, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-166 –


--- page 626 ---
Liquidity risk
The Group monitors its risk to a shortage of funds using a recurring liquidity planning tool.
This tool considers the maturity of both its financial instruments and financial assets and projected
cash flows from operations.
The Group’s objective is to maintain continuity of funding. The maturity profile of the
Group’s financial liabilities as at the end of each of the Relevant Periods, based on the contractual
undiscounted payments, is as follows:
As at December 31, 2022
Within 1 year or
on demand 1 to 2 years 2 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Trade and bill payables .... 671,476 — — — 671,476
Financial liabilities included
in other payables and
accruals ............ 161,989 — — — 161,989
Interest-bearing bank
borrowings .......... 17,223 — — — 17,223
Lease liabilities ........ 49,664 39,834 48,171 — 137,669
900,352 39,834 48,171 — 988,357
As at December 31, 2023
Within 1 year or
on demand 1 to 2 years 2 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Trade and bill payables .... 592,018 — — — 592,018
Financial liabilities included
in other payables and
accruals ............ 156,397 — — — 156,397
Liabilities from contingent
consideration ........ 68,683 — — — 68,683
Interest-bearing bank
borrowings .......... 77,409 — — — 77,409
Lease liabilities ........ 36,316 34,282 12,137 — 82,735
930,823 34,282 12,137 — 977,242
APPENDIX I ACCOUNTANTS’ REPORT
– I-167 –


--- page 627 ---
As at December 31, 2024
Within 1 year or
on demand 1 to 2 years 2 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Trade and bill payables .... 1,275,637 — — — 1,275,637
Financial liabilities included
in other payables and
accruals ............ 216,309 — — — 216,309
Liabilities from contingent
consideration ........ 8,523 — — — 8,523
Interest-bearing bank
borrowings .......... 7,580 35,592 184,197 — 227,369
Lease liabilities ........ 35,878 12,011 1,086 — 48,975
1,543,927 47,603 185,283 — 1,776,813
As at October 31, 2025
Within 1 year or
on demand 1 to 2 years 2 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Trade and bill payables .... 2,244,899 — — — 2,244,899
Financial liabilities included
in other payables and
accruals ............ 325,192 — — — 325,192
Interest-bearing bank
borrowings .......... 648,580 4,400 184,092 — 837,072
Lease liabilities ........ 23,058 5,092 8,136 — 36,286
3,241,729 9,492 192,228 — 3,443,449
APPENDIX I ACCOUNTANTS’ REPORT
– I-168 –


--- page 628 ---
Capital management
The primary objectives of the Group’s capital management are to safeguard the Group’s
ability to continue as a going concern and to maintain healthy capital ratios in order to support its
business and maximise shareholders’ value.
The Group manages its capital structure and makes adjustments to it in light of changes in
economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the
capital structure, the Group may adjust the dividend payment to shareholders, return capital to
shareholders or issue new shares. The Group is not subject to any externally imposed capital
requirements. No changes were made in the objectives, policies or processes for managing capital
during the Relevant Periods.
The gearing ratios as at the end of each of the Relevant Periods are as follows:
As at December 31,
As at
October 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
Total liabilities .................. 1,421,096 1,290,582 2,050,120 3,884,394
Total assets ..................... 7,151,808 5,979,127 7,186,497 9,568,686
Gearing ratio .................... 20% 22% 29% 41%
Note: Gearing ratio is calculated by dividing total liabilities by total assets and multiplying the product by 100%.
48. EVENTS AFTER THE RELEV ANT PERIODS
No other significant events have occurred to the Company, the Group or any of the
companies now comprising the Group in respective of any period subsequent to October 31, 2025.
49. SUBSEQUENT FINANCIAL STATEMENTS
No audited financial statements have been prepared by the Company, the Group or any of the
companies now comprising the Group in respect of any period subsequent to October 31, 2025.
APPENDIX I ACCOUNTANTS’ REPORT
– I-169 –


--- page 629 ---
The following information does not form part of the Accountants’ Report from Ernst & Young,
Certified Public Accountants, Hong Kong, the Company’ s reporting accountants, as set out in
Appendix I to this Prospectus, and is included herein for information purpose only. The unaudited
pro forma financial information should be read in conjunction with the section headed “Financial
Information” in this Prospectus and the Accountants’ Report set out in Appendix I to this
Prospectus.
A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET
TANGIBLE ASSETS
The following unaudited pro forma statement of adjusted consolidated net tangible assets
prepared in accordance with paragraph 4.29 of the Listing Rules and with reference to Accounting
Guideline 7 Preparation of Pro Forma Financial Information for inclusion in Investment Circulars
issued by the Hong Kong Institute of Certified Public Accountants for illustration purposes only,
and is set out here to illustrate the effect of the Global Offering on the consolidated net tangible
assets of the Group attributable to owners of the parent as of 31 October 2025 as if the Global
Offering had taken place on 31 October 2025.
The unaudited pro forma statement of adjusted consolidated net tangible assets of the Group
has been prepared for illustrative purpose only and, because of its hypothetical nature, it may not
give a true picture of the consolidated net tangible assets of the Group attributable to owners of
the parent had the Global Offering been completed as at 31 October 2025 or as at any future dates.
Consolidated net
tangible assets of
the Group
attributable to
owners of the
parent as at 31
October 2025
Estimated net
Proceeds from
the Global
Offering
Unaudited pro
forma adjusted
consolidated net
tangible assets as
at 31 October
2025
Unaudited pro forma adjusted
consolidated net tangible assets per
Share as at 31 October 2025
RMB’000 RMB’000 RMB’000 RMB HK$
(Note 1) (Notes 2, 4) (Note 3) (Note 4)
Based on the maximum Offer
Price of HK$95.80 per Share .. 5,651,043 4,158,500 9,809,543 20.61 22.96
Notes:
1. The consolidated net tangible assets of the Group attributable to owners of the parent as at 31 October 2025 is
arrived at after deducting goodwill and other intangible assets of RMB17,432,000 as at 31 October 2025 from the
audited consolidated net assets attributable to owners of the parent of RMB5,668,475,000 as at 31 October 2025 set
out in the Accountants’ Report in Appendix I to this Prospectus.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-1 –


--- page 630 ---
2. The estimated net proceeds from the Global Offering are based on the Offer Price of HK$95.80 per Share, being
the maximum offer price, after the deduction of underwriting fees and commissions and other related expenses
payable by the Company and do not take into account (i) any Shares which may be sold and offered upon exercise
of the Over-allotment Option or (ii) any Shares which may be issued or repurchased by the Company pursuant to
the Company’s general mandates.
3. The unaudited pro forma adjusted consolidated net tangible assets attributable to owners of the parent per Share is
arrived at after the adjustments referred to in the preceding paragraphs and on the basis that 475,960,952 Shares
were in issue assuming the Global Offering had been completed on 31 October 2025 and do not take into account
(i) any Shares which may be sold and offered upon exercise of the Over-allotment Option or (ii) any Shares which
may be issued or repurchased by the Company pursuant to the Company’s general mandates.
4. For the purpose of this unaudited pro forma statement of adjusted net tangible assets, the balances and amounts
stated in RMB are converted into HK$ at the rate of HK$1.00 to RMB0.8978, which was the exchange rate
prevailing on 21 January 2026. No representation is made that the RMB amounts have been, could have been or
may be converted to HK$, or vice versa, at that rate.
5. No other adjustment has been made to the unaudited pro forma adjusted consolidated net tangible asset of the
Group to reflect any trading result or other transactions entered into subsequent to 31 October 2025.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-2 –


--- page 631 ---
The following is the text of a report received from the Company’ s reporting accountants,
Ernst & Young, for the purpose of incorporation in this prospectus.
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hong Kong
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B. INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE
COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION
To the Directors of Shenzhen Han’s CNC Technology Co., Ltd.
We have completed our assurance engagement to report on the compilation of unaudited pro forma
financial information of Shenzhen Han’s CNC Technology Co., Ltd. (the “ Company ”) and its
subsidiaries (hereinafter collectively referred to as 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 consolidated net tangible assets as at 31 October 2025 and
related notes as set out on pages II-1 to II-2 of the prospectus dated 29 January 2026 (the
“Prospectus ”) issued by the Company (the “ Unaudited Pro Forma Financial Information ”). The
applicable criteria on the basis of which the Directors have compiled the Unaudited Pro Forma
Financial Information are described on pages II-1 to II-2.
The Unaudited Pro Forma Financial Information has been compiled by the Directors to illustrate
the impact of the global offering of shares of the Company on the Group’s financial position as at
31 October 2025 as if the transaction had taken place at 31 October 2025. As part of this process,
information about the Group’s financial position has been extracted by the Directors from the
Group’s financial statements for the period ended 31 October 2025, on which an accountants’
report has been published.
Directors’ responsibility for the Unaudited Pro Forma Financial Information
The Directors are responsible for compiling the Unaudited Pro Forma Financial Information
in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (the “ Listing Rules ”) and with reference to Accounting
Guideline (“ AG”) 7 Preparation of Pro Forma Financial Information for Inclusion in Investment
Circulars issued by the Hong Kong Institute of Certified Public Accountants (the “ HKICPA”).
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-3 –


--- page 632 ---
Our independence and quality management
We have complied with the independence and other ethical requirements of the Code of
Ethics for Professional Accountants issued by the HKICPA, which is founded on fundamental
principles of integrity, objectivity, professional competence and due care, confidentiality and
professional behavior.
Our firm applies Hong Kong Standard on Quality Management 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 Unaudited Pro Forma Financial Information and to report our opinion to you. We do
not accept any responsibility for any reports previously given by us on any financial information
used in the compilation of the Unaudited Pro Forma Financial Information beyond that owed to
those to whom those reports were addressed by us at the dates of their issue.
We conducted our engagement in accordance with Hong Kong Standard on Assurance
Engagements 3420 Assurance Engagements to Report on the Compilation of Pro Forma Financial
Information Included in a Prospectus issued by the HKICPA. This standard requires that the
reporting accountants plan and perform procedures to obtain reasonable assurance about whether
the Directors have compiled the Unaudited Pro Forma Financial Information in accordance with
paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.
For purposes of this engagement, we are not responsible for updating or reissuing any reports
or opinions on any historical financial information used in compiling the Unaudited Pro Forma
Financial Information, nor have we, in the course of this engagement, performed an audit or
review of the financial information used in compiling the Unaudited Pro Forma Financial
Information.
The purpose of the Unaudited Pro Forma Financial Information included in the Prospectus is
solely to illustrate the impact of the global offering of shares of the Company on unadjusted
financial information of the Group as if the transaction had been undertaken at an earlier date
selected for purposes of the illustration. Accordingly, we do not provide any assurance that the
actual outcome of the transaction would have been as presented.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-4 –


--- page 633 ---
A reasonable assurance engagement to report on whether the Unaudited Pro Forma Financial
Information has been properly compiled on the basis of the applicable criteria involves performing
procedures to assess whether the applicable criteria used by the Directors in the compilation of the
Unaudited Pro Forma Financial Information provide a reasonable basis for presenting the
significant effects directly attributable to the transaction, and to obtain sufficient appropriate
evidence about whether:
 the related pro forma adjustments give appropriate effect to those criteria; and
 the Unaudited Pro Forma Financial Information reflects the proper application of those
adjustments to the unadjusted financial information.
The procedures selected depend on the reporting accountants’ judgment, having regard to the
reporting accountants’ understanding of the nature of the Group, the transaction in respect of
which the Unaudited Pro Forma Financial Information has been compiled, and other relevant
engagement circumstances.
The engagement also involves evaluating the overall presentation of the Unaudited Pro Forma
Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Opinion
In our opinion:
(a) the Unaudited Pro Forma Financial Information has been properly compiled on the basis
stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purpose of the Unaudited Pro Forma Financial
Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.
Certified Public Accountants
Hong Kong
29 January 2026
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-5 –


--- page 634 ---
(A) PROFIT ESTIMATE FOR THE YEAR ENDED 31 DECEMBER 2025
I. Bases
Our Directors have prepared the estimate of the consolidated profit attributable to equity
holders of the Company for the year ended 31 December 2025 (the “Profit Estimate”) based on the
audited consolidated results of our Group for the ten months ended 31 October 2025 and the
unaudited consolidated results based on the management accounts of our Group for the remaining
two months ended 31 December 2025. The Profit Estimate has been prepared on the basis of the
accounting policies consistent in all material aspects with those currently adopted by our Group as
set out in the Accountants’ Report, the text of which is set out in Appendix I to this Prospectus.
II. Profit estimate for the year ended 31 December 2025
On the basis set out in Appendix IIA to this Prospectus, and in the absence of unforeseen
circumstances, we estimate that our consolidated profit attributable to equity holders of the
Company for the year ended 31 December 2025 are as follows:
Estimated consolidated profit attributable to equity holders of
the Company for the year ended 31 December 2025 ........
Not less than RMB785 million
(equivalent to approximately
HK$871 million)
APPENDIX IIA PROFIT ESTIMATE FOR YEAR ENDED DECEMBER 31, 2025
– IIA-1 –


--- page 635 ---
The following is the text of a report received from the independent reporting accountants,
Ernst & Young, Certified Public Accountants, Hong Kong, prepared for the purpose of
incorporation in this prospectus.
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hong Kong
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(B) LETTER FROM THE REPORTING ACCOUNTANTS
29 January 2026
The Board of Directors
Shenzhen Han’s CNC Technology Co., Ltd. (“the Company”)
China International Capital Corporation Hong Kong Securities Limited
Dear Sirs,
Shenzhen Han’s CNC Technology Co., Ltd. (“the Company”)
Profit estimate for year ended 31 December 2025
We refer to the estimate of the consolidated profit attributable to equity holders of the
Company for the year ended 31 December 2025 (“the Profit Estimate”) set forth in the section
headed “Financial Information” in the prospectus of the Company dated 29 January 2026 (“the
Prospectus”).
Directors’ responsibilities
The Profit Estimate has been prepared by the directors of the Company based on the audited
consolidated results of the Company and its subsidiaries (collectively referred to as “the Group”)
for the ten months ended 31 October 2025, the unaudited consolidated results based on the
management accounts of the Group for the remaining two months ended 31 December 2025.
The Company’s directors are solely responsible for the Profit Estimate.
APPENDIX IIA PROFIT ESTIMATE FOR YEAR ENDED DECEMBER 31, 2025
– IIA-2 –


--- page 636 ---
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 Hong Kong Institute of Certified Public
Accountants (“HKICPA”), which is founded on fundamental principles of integrity, objectivity,
professional competence and due care, confidentiality and professional behavior.
Our firm applies Hong Kong Standard on Quality Management 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 control 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 on the accounting policies and calculations of the
Profit Estimate based on our procedures.
We conducted our engagement in accordance with Hong Kong Standard on Investment
Circular Reporting Engagements 500 Reporting on Profit Forecasts, Statements of Sufficiency of
Working Capital and Statements of Indebtedness and with reference to Hong Kong Standard on
Assurance Engagements 3000 (Revised) Assurance Engagements Other Than Audits or Reviews of
Historical Financial Information issued by the HKICPA. Those standards require that we plan and
perform our work to obtain reasonable assurance as to whether, so far as the accounting policies
and calculations are concerned, the Company’s directors have properly compiled the Profit
Estimate in accordance with the bases adopted by the directors and as to whether the Profit
Estimate is presented on a basis consistent in all material respects with the accounting policies
normally adopted by the Group. Our work is substantially less in scope than an audit conducted in
accordance with Hong Kong Standards on Auditing issued by the HKICPA. Accordingly, we do not
express an audit opinion.
APPENDIX IIA PROFIT ESTIMATE FOR YEAR ENDED DECEMBER 31, 2025
– IIA-3 –


--- page 637 ---
Opinion
In our opinion, so far as the accounting policies and calculations are concerned, the Profit
Estimate has been properly compiled in accordance with the bases adopted by the directors as set
out in Appendix IIA of the Prospectus and is presented on a basis consistent in all material
respects with the accounting policies normally adopted by the Group as set out in our accountants’
report dated 29 January 2026, the text of which is set out in Appendix I of the Prospectus.
Yours faithfully,
Certified Public Accountants
Hong Kong
APPENDIX IIA PROFIT ESTIMATE FOR YEAR ENDED DECEMBER 31, 2025
– IIA-4 –


--- page 638 ---
(C) LETTER FROM THE SOLE SPONSOR
The following is the text of a letter prepared for inclusion in the Prospectus (as defined
below) by the Sole Sponsor , in connection with the estimate of the consolidated profit attributable
to equity holders of the Company (as defined below) for the year ended December 31, 2025.
January 29, 2026
The Directors
Shenzhen Han’s CNC Technology Co., Ltd.
Dear Sirs,
We refer to the estimate of the consolidated profit attributable to equity holders of Shenzhen
Han’s CNC Technology Co., Ltd. (the “ Company ”) for the year ended December 31, 2025 (the
“Profit Estimate ”) set forth in the section headed “Financial Information — Profit Estimate for
the Year Ended December 31, 2025” in the prospectus of the Company dated January 29, 2026 (the
“Prospectus ”).
The Profit Estimate, for which you as the Directors of the Company (the “ Directors ”) are
solely responsible, has been prepared based on the audited consolidated results of the Group for
the ten months ended October 31, 2025 and the unaudited consolidated results based on the
management accounts of the Group for the two months ended December 31, 2025.
We have discussed with you the bases made by the Directors as set out in the Part A of
Appendix IIA to the Prospectus upon which the Profit Estimate has been made. We have also
considered the letter dated January 29, 2026 addressed to you and us from Ernst & Young
regarding the accounting policies and calculations upon which the Profit Estimate has been made.
On the basis of the information comprising the Profit Estimate and on the basis of the
accounting policies and calculations adopted by you and reviewed by Ernst & Young, we are of the
opinion that the Profit Estimate, for which you as Directors are solely responsible, has been made
after due and careful enquiry.
Yours faithfully,
For and on behalf of
China International Capital Corporation Hong Kong Securities Limited
WANG Meng
Director
APPENDIX IIA PROFIT ESTIMATE FOR YEAR ENDED DECEMBER 31, 2025
– IIA-5 –


--- page 639 ---
TAXATION OF SECURITY HOLDERS
Income tax and capital gains tax for holders of H Shares are provided for under the laws and
practices of the PRC and the jurisdictions in which the holders of H Shares are resident or
otherwise subject to tax. The following summary of certain relevant tax provisions is based on
current laws and practices and does not take into account anticipated changes or modifications in
relevant laws or policies and does not constitute any opinion or recommendation. The discussion
does not address all of the possible tax implications relating to the H Shares, nor does it consider
the specific circumstances of any particular investors, some of which may be subject to special
rules. Accordingly, you should consult your tax advisers as to the tax implications of the H Shares.
This discussion is based on the laws and relevant interpretations in force as at the Latest
Practicable Date, all of which are subject to change or adjustment and may have retrospective
effect.
This discussion does not cover any aspects of PRC taxes other than income tax, capital gains
tax and profits tax, business tax, value-added tax, stamp duty and estate tax. Prospective investors
should consult their financial advisers regarding the PRC and other tax implications of owning and
disposing of the H shares.
Taxation in Chinese Mainland
Tax on Dividends
Individual Investors
Pursuant to the Notice on the Issues Concerning Individual Income Tax Collection and
Management after the Repeal of Guo Shui Fa [1993] No. 045 (਷೼೯ [1993]045 ໮˖΁ᄻ˟
) (Guo Shui Han [2011] No. 348) ( ਷೼Ռ[2011]348 ໮) dated
June 28, 2011, issued by the SAT, dividends paid to non-Chinese mainland resident individual
holders of H Shares are generally subject to the individual income tax of Chinese mainland at a
withholding tax rate of 10%. Under the Arrangement 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 Income (ᅄ೼ձԣ
τર), the PRC government may impose tax on dividends paid by Chinese companies
to Hong Kong residents (including natural and legal persons), but the amount of the imposing tax
shall not exceed 10% of the total dividends payable by the Chinese company. If a Hong Kong
resident directly holds 25% or more of the equity of the PRC company, and the Hong Kong
resident is the beneficial owner of the dividends and satisfies other conditions, the relevant tax
shall not exceed 5% of the total dividends payable by the PRC company. The Fifth Protocol of the
SAT to the Arrangement between the Mainland and the Hong Kong Special Administrative Region
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-1 –


--- page 640 ---
for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes
on Income (ᅄ೼ձԣ˟ਊဍ೼
, promulgated by the SAT and came into effect on December 6, 2019,
provides that such provisions shall not apply to any arrangement or transaction whose main
purpose is to obtain such tax incentives.
Enterprise Investors
According to the Enterprise Income Tax Law of the PRC ()
(the “ EIT Law ”), revised by the SCNPC and became effective on December 29, 2018, and the
Implementation Regulations of the Enterprise Income Tax Law of the PRC ( ʕശɛ͏΍ձ਷Άุ
ૢԷ), revised by the State Council and became effective on January 20, 2025, the
enterprise income tax rate shall be 25%. Non-resident enterprises that have not established
institutions or premises in the PRC, or those that have established institutions or premises but
whose income from sources in the PRC has no actual connection with such institutions or
premises, shall pay a 10% enterprise income tax on income from sources in the PRC (including
dividends paid by resident enterprises of the PRC whose shares are issued and listed in Hong
Kong). The foregoing income tax payable by non-resident enterprises is subject to withholding at
source, in which the payer of the income is required to withhold it from the payment or due
payment every time it is paid or due. Such withholding tax may be reduced or exempted under
applicable treaties to avoid double taxation.
According to the Notice on Issues concerning Withholding the Enterprise Income Tax on the
Dividends Paid by Chinese Resident Enterprises to Overseas Non-Resident H-share Enterprise
Shareholders (͏ΆุΣྤ̮ H੻೼Ϟᗫ
), issued by SAT and became effective on November 6, 2008, Chinese resident
enterprises shall uniformly withhold and pay corporate income tax at a rate of 10% when paying
dividends to non-resident H-share enterprise shareholders of the PRC in 2008 and subsequent
years. The above tax rate may be further adjusted according to tax treaties or agreements
concluded between China and relevant countries or regions (if applicable).
According to the Arrangement 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 Income (ᅄ೼ձԣ˟ਊဍ೼
τર), the PRC government may impose tax on dividends paid by Chinese companies to Hong
Kong residents (including natural persons and legal entities), but the tax amount shall not exceed
10% of the total dividends payable by the Chinese company. If a Hong Kong resident directly
holds at least 25% of the shares of a Chinese company, and such Hong Kong resident is the
beneficial owner of the dividend and meets other conditions, the tax amount levied shall not
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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exceed 5% of the total dividends payable by the Chinese company. The Fifth Protocol stipulates
that these provisions do not apply to arrangements or transactions made primarily for the purpose
of obtaining such tax benefits.
Tax Related to Share Transfer Income
Individual Investors
According to the IIT Law and its implementing regulations, gains from the sale of equity in
Chinese resident enterprises shall be subject to a 20% individual income tax. According to the
Circular on Continuing the Temporary Exemption of Individual Income Tax on Gains from Share
Transfers by Individuals ( ) issued by
MOF and SAT and became effective on March 30, 1998, starting from January 1, 1997, gains from
the transfer of listed company stocks by individuals will continue to be temporarily exempt from
individual income tax. According to the Circular on the Issues Relating to the Collection of
Individual Income Tax on Individuals’ Income from the Transfer of Restricted Shares of Listed
Companies ( ) jointly
promulgated by the MOF, the SAT and the CSRC on December 31, 2009, which came into effect
on the same date, individuals shall continue to be exempted from the individual income tax on the
income from the transfer of listed shares acquired from the public offering of listed companies and
the transfer market on the Shanghai Stock Exchange and the Shenzhen Stock Exchange, with the
exception of the relevant restricted shares as defined in the above Circular and the Supplementary
Circular on the Issues Relating to the Collection of Individual Income Tax on Individuals’ Income
from the Transfer of Restricted Shares of Listed Companies (੻
), which was jointly promulgated and enforced by the MOF,
the SAT and the CSRC on November 10, 2010. As of the Latest Practicable Date, the above
provisions did not expressly provide for imposition of the individual income tax on the transfer of
shares of Chinese resident enterprises listed on overseas stock exchanges by non-Chinese resident
individuals.
Enterprise Investors
According to the EIT Law and its implementing regulations, if a non-resident enterprise does
not have an institution or premise in the PRC, or has an institution or premise in the PRC but its
income derived from the PRC has no actual connection with such an institution or premise, the
non-resident enterprise generally shall pay corporate income tax at a rate of 10% on its income
derived from China (including gains from the sale of equity in a Chinese resident enterprise). The
aforesaid income tax payable by a non-resident enterprise of the PRC shall be withheld at source,
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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where the payer of the income shall be the withholding agent. The withholding agent shall
withhold income tax on each payment or due payment. The tax may be reduced or exempted under
tax treaties or agreements for the avoidance of double taxation.
Shanghai-Hong Kong Stock Connect Taxation Policy and Shenzhen-Hong Kong Stock Connect
Taxation Policy
On October 31, 2014 and November 5, 2016, the MOF, the SAT and the CSRC jointly issued
the Circular on the Relevant Taxation Policy regarding the Pilot Inter-connected Mechanism for
Trading on the Shanghai Stock Market and the Hong Kong Stock Market (ୃ̹ఙʹ
 ) and the Circular on the Relevant Taxation Policy
regarding the Pilot Inter-connected Mechanism for Trading on the Shenzhen Stock Market and the
Hong Kong Stock Market ( ),
pursuant to which, the income from transfer differences and dividend and bonus income derived by
PRC enterprise investors from investing in stocks listed on the Hong Kong Stock Exchange
through Shanghai-Hong Kong Stock Connect or Shenzhen-Hong Kong Stock Connect shall be
included in their total income and subject to enterprise income tax in accordance with the law. In
particular, the dividend and bonus income derived by PRC resident enterprises which hold H
shares for at least 12 consecutive months shall be exempted from enterprise income tax according
to law. The H-share companies do not need to withhold tax on the income from dividends and
bonus obtained by PRC enterprise investors. The tax payable shall be declared and paid by the
enterprises themselves.
For dividends and bonuses received by PRC individual investors investing in H shares listed
on the Hong Kong Stock Exchange through Shanghai-Hong Kong Stock Connect and
Shenzhen-Hong Kong Stock Connect, H-share companies shall submit an application to China
Securities Depository and Clearing Corporation Limited (the “ CSDC”), which shall provide
H-share companies with a register of PRC individual investors. H-share companies shall withhold
individual income tax at a rate of 20%. Individual investors who have paid withholding tax outside
the PRC may apply for tax credits at the competent tax authorities of the CSDC with valid tax
deduction certificates. Individual income tax is levied on dividend and bonus income derived by
PRC security investment funds from investing in stocks listed on the Hong Kong Stock Exchange
through Shanghai-Hong Kong Stock Connect or Shenzhen-Hong Kong Stock Connect in
accordance with the above provisions.
Stamp Duty
According to the Stamp Tax Law of the PRC () promulgated on
June 10, 2021 and became effective on July 1, 2022, non-Chinese mainland investors shall not be
subject to the provisions of the Stamp Tax Law of the PRC when disposing of H shares overseas.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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Estate Duty
According to the PRC law, no estate duty has been imposed on the Company in the PRC.
MAJOR TAXATION OF OUR COMPANY IN CHINA
EIT
According to the EIT Law of the PRC, enterprises and other organizations that obtain income
(hereinafter collectively referred to as “ enterprises ”) are taxpayers for enterprise income tax and
shall pay such tax in accordance with this law. The enterprise income tax rate is 25%. High-tech
enterprises that PRC government needs to support with priority shall be subject to a reduced
enterprise income tax rate of 15%.
Enterprises are categorized into resident enterprises and non-resident enterprises.
Non-resident enterprises that have not established institutions or premises in the PRC, or have
established such institutions or premises but whose income from within the PRC has no actual
connection with these institutions or premises, must pay corporate income tax on income derived
from within the PRC. This is implemented through withholding at source, where the payer is the
withholding agent, and the tax is withheld by the payer from each payment or when the payment is
due. Additionally, any gains realized by such investors from the transfer of shares must be subject
to corporate income tax. If such gains are deemed to be from property transfers within China, they
should also be subject to withholding at source.
VAT
In accordance with the Interim Regulations on Value-added Tax of the PRC ( ʕശɛ͏΍ձ
೼ᅲБૢԷ) promulgated by the State Council on December 13, 1993 and implemented
on January 1, 1994, and then amended on November 19, 2017 and implemented on the same day,
and the Detailed Rules for the Implementation of the Interim Regulations on Value-added Tax of
the PRC ( ) promulgated by the MOF on December
25, 1993 and implemented on the same day, last amended on October 28, 2011 and implemented
on November 1, 2011, the companies and individuals engaging in sale of goods or processing,
repair and assembly services, sale of services, intangible assets, immovable properties and
importation of goods in PRC are V AT payers and shall pay V AT in accordance with the law. Unless
otherwise specified, the V AT rate for the sale of goods, services, tangible movable properties
leasing services or imported goods by taxpayers shall be 17%; taxpayers who sell transportation,
postal services, basic telecommunications, construction, real estate leasing services, sell
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--- page 644 ---
immovable properties, transfer land use rights, and sell or import specific goods shall be subject to
a V AT rate of 11%; unless otherwise specified, the V AT rate for the sale of services and intangible
assets by taxpayers is 6%.
Pursuant to the Notice on the Adjustment to V AT Rates ()
(Caishui [2018] No.32), promulgated by the MOF and the SAT on April 4, 2018, and became
effective on May 1, 2018, the V AT rates of 17% and 11% applicable to the taxpayers who have
V AT taxable sales activities or imported goods are adjusted to 16% and 10%, respectively.
Pursuant to the Announcement on Relevant Policies for Deepening V AT Reform (ଉʷᄣ
ʮѓ (Announcement of MOF, SAT and General Administration of Customs,
[2019] No. 39)), promulgated by the MOF, the SAT and the General Administration of Customs on
March 20, 2019 and became effective on April 1, 2019, the V AT rates of 16% and 10% applicable to
the taxpayers who have V AT taxable sales activities or imported goods are adjusted to 13% and 9%,
respectively.
FOREIGN EXCHANGE ADMINISTRATION
The legal currency in China is the RMB. The State Administration of Foreign Exchange is
authorized by the People’s Bank of China to manage all matters related to foreign exchange,
including the implementation of foreign exchange regulations.
According to the Regulations on Foreign Exchange Control of the PRC ( ʕശɛ͏΍ձ਷̮
ි၍ଣૢԷ), revised by the State Council and became effective on August 5, 2008, all
international payments and transfers are categorized into current account and capital account. The
current account shall be subject to the reasonable examination of the authenticity of transaction
documents and their consistency with foreign exchange receipts and payments by the financial
institutions engaging in the business of foreign exchange settlement and sales, and shall be subject
to the supervision and inspection by the foreign exchange administrative authorities. With regard
to the capital account, foreign organizations and individuals making direct investments in China
shall, upon approval by the competent authorities concerned, register with the foreign exchange
administrative authorities. The foreign exchange income obtained from abroad may be repatriated
or deposited abroad. Foreign exchange funds and foreign exchange settlement funds under the
capital account shall be used for the purposes approved by the relevant competent authorities and
the foreign exchange administrative authorities. When there is or may be a serious imbalance in
the international balance of payments, or when there is or may be a serious crisis in the national
economy, the State may take measures necessary to guarantee and control the international balance
of payments.
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The Regulations on the Administration of Settlement, Sale and Payment of Foreign Exchange
() promulgated by the PBOC on June 20, 1996 and became
effective from July 1, 1996, have abrogated other restrictions on foreign exchange under the
current account, but imposed existing restrictions on foreign exchange transactions under the
capital account.
According to relevant laws and regulations of China, Chinese enterprises (including
foreign-invested enterprises) that require foreign exchange for their current account transactions
can pay from their foreign exchange accounts at designated foreign exchange banks with valid
receipts and transaction vouchers, without the need for approval from the SAFE. Foreign-invested
enterprises that need to distribute profits to shareholders using foreign exchange, and Chinese
enterprises that are required to pay fixed dividends in foreign exchange according to regulations,
may legally pay from their foreign exchange accounts or redeem at designated foreign exchange
banks with a board resolution on profit distribution.
According to the Decision of the State Council on Cancellation and Adjustment of a Batch of
Items Requiring Government Review and Approval (ᄲҭධͦഃ
) promulgated by The State Council and became effective on October 23, 2014, it is
decided to cancel the examination and approval requirements of the SAFE and its branches for the
remittance and settlement of proceeds raised from the overseas listing of overseas shares into
domestic accounts in RMB.
According to the Circular of SAFE on Relevant Issues Concerning the Foreign Exchange
Administration of Overseas Listing ( )
issued by the SAFE and became effective on December 26, 2014, the relevant provisions on
foreign exchange management for domestic joint stock companies listed overseas (“ domestic
companies ”) are as follows:
(i) The SAFE and its branches, foreign exchange administration departments (hereinafter
referred to as foreign exchange bureaus) shall supervise, manage and inspect the
business registration, account opening and use, cross-border income and expenditure,
capital exchange and other activities involved in the overseas listing of domestic
companies.
(ii) The domestic company shall, within 15 working days after the end of the initial share
issue for overseas listing, go to the foreign exchange bureau at its place of registration
with relevant materials to register for overseas listing.
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(iii) After the overseas listing of a domestic company, if its domestic shareholders intend to
increase or reduce their overseas shares according to relevant regulations, they shall,
within 20 working days prior to the proposed increase or reduction of their shares, hold
relevant materials to the local foreign exchange bureau where the domestic shareholders
are located to register their overseas holdings.
(iv) Domestic companies (except banking financial institutions) shall, with the registration
certificate for overseas listing business, open a “domestic company’s special foreign
exchange account for overseas listing” at domestic banks for their initial public offering
(or additional issuance) and repurchase business, and handle the capital exchange and
transfer of relevant business.
According to the Notice of the State Administration of Foreign Exchange on Further
Simplifying and Improving Policies for the Foreign Exchange Administration of Direct Investment
( ), issued on February
13, 2015, and became effective from June 1, 2015, the SAFE has abolished the approval of foreign
exchange registration for domestic direct investment and overseas direct investment. Instead, banks
will directly review and process the foreign exchange registration for domestic direct investment
and overseas direct investment according to this notice and the attached Guidelines for Direct
Investment Foreign Exchange Business Operations (ˏ). The SAFE
and its branches will indirectly supervise the foreign exchange registration for direct investment
through banks.
According to the Notice of the State Administration of Foreign Exchange of the PRC on
Revolutionize and Regulate Capital Account Settlement Management Policies (̮ි၍ଣ҅
 ) issued and implemented by the SAFE on June 9,
2016, capital account foreign exchange receipts (including funds repatriated from overseas listings,
etc.) intended for exchange can be processed at banks based on the actual operational needs of
domestic institutions. Domestic institutions may, at their discretion, settle up to 100% of foreign
exchange receipts under capital accounts for the time being. The SAFE may adjust this ratio as
appropriate in light of international balance of payments conditions.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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This Appendix outlines certain aspects of the laws and regulations of the PRC relating to the
operation and business of the Company. The primary purpose of this summary is to highlight to
potential investors the principal laws and regulatory provisions applicable to the Company. This
summary is not intended to encompass all material information that may be relevant to potential
investors. For a discussion of the laws and regulations relating to the Company’s business, please
refer to the “Regulatory Overview” in this document.
PRC LEGAL SYSTEM
The PRC legal system is founded upon the Constitution of the PRC ()
(the “ Constitution ”) and comprises written laws, administrative regulations, local regulations,
separate regulations, departmental rules of the State Council, local government rules, autonomous
regulations, specific regulations of autonomous regions, laws of the Special Administrative
Regions, and international treaties signed by the government of the PRC, as well as other
regulatory documents. Court verdicts do not constitute binding precedents but may be utilized for
judicial reference and guidance.
Pursuant to the Constitution and the Legislation Law of the PRC ()
(the “ Legislation Law ”), as revised by the NPC on March 13, 2023, and effective on March 15,
2023, the NPC and its Standing Committee of the NPC are vested with the power to exercise
national legislative authority. The NPC is empowered to enact and amend fundamental laws
governing criminal, civil, state institutions and other matters. The SCNPC is authorized to
formulate and amend laws other than those that should be enacted by the NPC. During the NPC’s
recess, the SCNPC may partially supplement and amend laws enacted by the NPC, provided that
such amendments do not contravene the fundamental principles of these laws.
The State Council, as the highest administrative body of the state, formulates administrative
regulations in accordance with the Constitution and laws. The people’s congresses and their
standing committees at the provincial level, autonomous regions, and municipalities directly under
the Central Government may enact local regulations based on the specific circumstances and
practical needs of their respective administrative regions, provided that these local regulations do
not contravene any provisions of the Constitution, laws, or administrative regulations. The people’s
congresses and their standing committees of cities divided into districts may formulate local
regulations on urban and rural construction and management, environmental protection, and
historical and cultural preservation, in accordance with the specific conditions and practical needs
of their respective cities, but these regulations must not conflict with any provisions of the
Constitution, laws, administrative regulations, and local regulations of provinces and autonomous
regions. Where laws provide otherwise for the formulation of local regulations by cities divided
into districts, such provisions shall prevail. Local regulations of cities in autonomous regions shall
be implemented after being submitted for approval.
APPENDIX IV SUMMARY OF PRINCIPAL LAWS AND REGULATORY PROVISIONS
–I V - 1–


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The standing committees of the people’s congresses of provinces and autonomous regions
shall conduct legality reviews of local regulations submitted for approval. Those that do not
contravene the Constitution, laws, administrative regulations, and local regulations of the province
or autonomous region shall be approved within 4 months. The people’s congresses of ethnic
autonomous areas have the right to formulate autonomous regulations and specific regulations
based on the political, economic, and cultural characteristics of the various ethnic groups in the
area. The ministries and commissions of the State Council, the People’s Bank of China, National
Audit Office of the PRC, and institutions directly under the State Council with administrative
management functions may formulate rules within their respective jurisdictions based on laws,
administrative regulations, decisions, and rulings of the State Council.
The Constitution holds the supreme legal authority, and all laws, administrative regulations,
local regulations, autonomous regulations, and specific regulations or rules must not contravene
the Constitution. Laws take precedence over administrative regulations, local regulations, and
rules. Administrative regulations take precedence over local regulations and rules. Regulations
formulated by the people’s governments of provinces and autonomous regions take precedence
over the regulations formulated by the people’s governments of cities with districts within their
respective administrative regions.
The NPC possesses the authority to amend or nullify inappropriate laws enacted by the
SCNPC, and is empowered to revoke autonomous regulations and specific regulations approved by
the SCNPC that contravene the Constitution and the Legislation Law. The SCNPC is authorized to
annul administrative regulations that violate the Constitution and laws, and is empowered to
revoke local regulations that contravene the Constitution, laws, and administrative regulations, as
well as autonomous regulations and specific regulations approved by the standing committees of
the people’s congresses of provinces, autonomous regions, and municipalities directly under the
Central Government that violate the Constitution and the Legislation Law. The State Council is
vested with the power to amend or nullify inappropriate departmental rules and local government
regulations. The people’s congresses of provinces, autonomous regions, and municipalities directly
under the Central Government have the authority to amend or nullify inappropriate local
regulations formulated or approved by their respective standing committees. The standing
committees of local people’s congresses are empowered to revoke inappropriate regulations
formulated by the people’s governments at the same level. The people’s governments of provinces
and autonomous regions are authorized to amend or nullify any inappropriate regulations
formulated by the people’s governments at lower levels.
Pursuant to the Constitution and the Legislation Law, the power of legal interpretation is
vested in the SCNPC. According to the Resolution of SCNPC on Strengthening the Work of Legal
Interpretation (Ӕᙄ ), adopted by the
SCNPC and effective on June 10, 1981, the Supreme People’s Court is authorized to interpret
APPENDIX IV SUMMARY OF PRINCIPAL LAWS AND REGULATORY PROVISIONS
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--- page 649 ---
specific issuesconcerning the application of laws and decrees in judicial trials. The Supreme
People’s Procuratorate shall interpret all issues that are related to the specific application of laws
and decrees in procuratorial work. The State Council and relevant competent departments are
responsible for interpreting how to specifically apply other laws and decrees that do not fall under
the purview of judicial and procuratorial work.
Where the scope of local regulations requires further definition or supplementary provisions,
the standing committee of the people’s congress of the province, autonomous region, or
municipality directly under the Central Government that formulated the regulations shall interpret
or stipulate. Interpretations of specific application issues of local regulations shall be the
responsibility of the competent departments of the people’s governments of provinces, autonomous
regions, and municipalities directly under the Central Government.
PRC JUDICIAL SYSTEM
Pursuant to the Constitution and the Organic Law of the People’s Courts of the PRC ( ʕശ
), as revised by the SCNPC on October 26, 2018, and effective from
January 1, 2019, the People’s Courts of the PRC comprise the Supreme People’s Court, local
people’s courts at various levels, and other specialized people’s courts. Local people’s courts are
categorized into three levels: primary people’s courts, intermediate people’s courts, and higher
people’s courts. Primary people’s courts may establish several people’s tribunals based on regional,
population, and case circumstances. The Supreme People’s Court serves as the highest adjudicatory
organ of the state. The Supreme People’s Court supervises the exercise of judicial power by local
people’s courts at all levels and specialized people’s courts. The people’s courts at higher levels
supervise the adjudication work of the people’s courts at lower levels.
According to the Constitution and the Organic Law of the People’s Procuratorates of the PRC
(), as revised by the SCNPC on October 26, 2018, and
effective from January 1, 2019, the people’s procuratorates serve as the state’s legal supervision
bodies. The Supreme People’s Procuratorate functions as the highest procuratorial organ. The
Supreme People’s Procuratorate directs the work of local people’s procuratorates at all levels and
specialized people’s procuratorates, with higher-level people’s procuratorates overseeing the work
of lower-level procuratorates.
The People’s Court implements a system of two instances with final adjudication. The
second-instance judgments or rulings of the People’s Court constitute the final judgments or
rulings. Parties dissatisfied with the first-instance judgments or rulings of a local People’s Court
may file an appeal. The People’s Procuratorate may, in accordance with the procedures prescribed
by law, lodge a protest with the People’s Court at the next higher level. If a party does not appeal
and the People’s Procuratorate does not protest within the prescribed time limit, the judgments or
APPENDIX IV SUMMARY OF PRINCIPAL LAWS AND REGULATORY PROVISIONS
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--- page 650 ---
rulings of the People’s Court become the final judgments or rulings. The second-instance
judgments or rulings of the Intermediate People’s Courts, Higher People’s Courts, and the Supreme
People’s Court, as well as the first-instance judgments or rulings of the Supreme People’s Court,
are the final judgments or rulings. However, if the Supreme People’s Court or a People’s Court at
a higher level discovers that a final judgment or ruling of a lower-level People’s Court that has
already taken legal effect is indeed erroneous, or if the presiding judge of any level of People’s
Court discovers that a final judgment or ruling of the People’s Court at the same level that has
already taken legal effect is indeed erroneous, a retrial may be conducted in accordance with the
judicial supervision procedures.
The Civil Procedure Law of PRC (), adopted by the SCNPC
on September 1, 2023, and effective on January 1, 2024, outlines the requirements for initiating
civil litigation, the jurisdiction of the People’s Courts, the procedures to be followed in civil
proceedings, and the enforcement of civil judgments or orders. All parties involved in civil
litigation within the territory of the PRC must adhere to the Civil Procedure Law of PRC. Civil
cases are generally adjudicated by the court in the defendant’s domicile. The jurisdictional court
for civil litigation can be explicitly agreed upon by the parties, provided the court is located in a
place with a substantial connection to the dispute, such as the domicile of the plaintiff or
defendant, the place of contract performance or contract signing, or the location of the subject
matter of the litigation. However, the choice of court must not, under any circumstances,
contravene the provisions regarding level jurisdictions and exclusive jurisdictions.
Foreign individuals, stateless persons, foreign-invested enterprises, or foreign organizations
that initiate litigation or defense in the People’s Court shall have the same procedural rights and
obligations as Chinese citizens, legal persons, or other organizations. If a foreign court restricts the
procedural rights of Chinese citizens and enterprises, the Chinese court may apply the same
restrictions to the foreign citizens and enterprises. When foreign individuals, stateless persons,
foreign-invested enterprises, or foreign organizations initiate litigation or defense in the People’s
Court, they must retain a Chinese lawyer. According to international treaties signed or acceded to
by the PRC or the principle of reciprocity, the People’s Court and foreign courts may request each
other to serve documents, conduct investigations, and take other actions. The People’s Court shall
reject requests from foreign courts that may infringe upon the sovereignty, security, or public
interest of the PRC.
The parties involved must fulfill civil judgments and rulings that have legal effect. If a party
in a civil lawsuit refuses to comply with a judgment or ruling made by the People’s Court of the
PRC or an arbitral tribunal’s award, the other party may apply to the People’s Court for
enforcement within 2 years. The suspension or interruption of the application period for
enforcement shall comply with the provisions of applicable laws concerning the suspension or
interruption of the statute of limitations.
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Judgments and rulings rendered by the People’s Courts, where the judgment debtor or their
assets are not within the territory of the PRC, may be subject to direct application for recognition
and enforcement by the interested party to a foreign court with jurisdiction. Judgments and rulings
rendered by foreign courts may be recognized and enforced by the People’s Courts, following
examination in accordance with the provisions of international treaties concluded or acceded to by
the PRC with the relevant country, or based on the principle of reciprocity. Such recognition and
enforcement are contingent upon the determination that the foreign judgment or ruling does not
contravene the fundamental principles of Chinese law, nor does it infringe upon national
sovereignty, security, or the public interest of society.
THE PRC COMPANY LAW, OVERSEAS LISTING MEASURES AND GUIDELINES FOR
ARTICLES OF ASSOCIATION
For a joint stock limited company incorporated in the PRC seeking a listing on The Stock
Exchange of Hong Kong Limited, the primary regulatory framework is governed by the following
PRC laws and regulations.
The Company Law of the PRC () (the “ Company Law ”) was
adopted on December 29, 1993, by the Fifth Session of the Standing Committee of the Eighth
National People’s Congress, and came into effect on July 1, 1994. It has been amended on
December 25, 1999, August 28, 2004, October 27, 2005, December 28, 2013, October 26, 2018,
and December 29, 2023, respectively. The most recent revision of the Company Law takes effect
on July 1, 2024.
The Trial Measures for the Administration Related to the Overseas Securities Offering and
Listing by Domestic Companies ( ) (the “ Overseas
Listing Measures ”), along with its five interpretative guidelines, promulgated by the China
Securities Regulatory Commission (the “CSRC” ) on February 17, 2023, became effective on
March 31, 2023. These regulations govern both direct and indirect overseas subscription and
listings of shares by domestic companies.
Pursuant to the Overseas Listings Measures and its interpretive guidelines, domestic
companies directly issuing and listing shares overseas shall formulate their articles of association
in accordance with the Guidelines for Articles of Association of Listed Companies ( ɪ̹ʮ̡௝
ˏ) (the “ Guidelines for Articles of Association ”), superseding the Mandatory Provisions
for Articles of Association of Companies Listed Overseas ( Ցྤ̮ɪ̹ʮ̡௝೻̀௪ૢಛ),
which ceased to be applicable from March 31, 2023. The Guidelines for Articles of Association
were promulgated by the CSRC on December 16, 1997, and were most recently amended on March
28, 2025.
APPENDIX IV SUMMARY OF PRINCIPAL LAWS AND REGULATORY PROVISIONS
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The following is a summary of the principal provisions of the Company Law, the Overseas
Listings Measures, and the Guidelines for Articles of Association applicable to our Company.
General Provisions
A joint stock limited company is a corporate legal person established in accordance with the
Company Law. Its registered capital is comprised of shares with an equal par value. Shareholders
bear liability limited to the extent of their subscribed shares, while the company itself is liable for
its debts with all of its assets.
A company, in the conduct of its business operations, must adhere to the laws and
regulations, social ethics, and commercial morality. A company may invest in other companies
with limited liability. The liability of the investing company for the obligations of the invested
company is limited to the amount of its investment. Unless otherwise stipulated by law, a company
shall not become an investor jointly and severally liable for the debts of the invested company.
Incorporation
A joint stock limited company may be incorporated through either the method of promotion
or the method of offering shares for subscription. A joint stock limited company can be
incorporated by a minimum of 1 promoter and a maximum of 200 promoters, with more than half
of the promoters required to have a domicile within the territory of the PRC.
The promoters shall convene the inaugural meeting of the company within 30 days following
the full payment of the share capital. Notice of the meeting date must be provided to all
subscribers or publicly announced in this regard no less than 15 days prior to the meeting. The
inaugural meeting can only be held if the promoters and subscribers holding more than 50% of the
total shares are present. The powers exercised at the inaugural meeting shall include, but not be
limited to, the adoption of the articles of association, and the election of the members of the board
of directors and board of supervisors. Resolutions on these matters shall be passed by a majority
vote of more than 50% of the votes cast by the attending subscribers.
Within 30 days after the conclusion of the inaugural meeting, the board of directors shall
apply to the registration authority for the incorporation of a joint stock limited company. After the
relevant registration authority issues a business license, the company is officially established and
has the status of a legal person.
APPENDIX IV SUMMARY OF PRINCIPAL LAWS AND REGULATORY PROVISIONS
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--- page 653 ---
Registered Shares
According to the Company Law, shareholders may contribute in cash or in kind, intellectual
property rights, land use rights and other non-monetary property that may be valued in currency
and may be transferred in accordance with the law.
The Overseas Listing Measures stipulate that domestic enterprises listed abroad may raise
funds and distribute dividends in foreign currency or RMB.
Under the Company Law, a joint stock limited company shall prepare and maintain a
shareholder register at the company. The shareholder register shall record the following particulars:
(i) The name and domicile of each shareholder;
(ii) The class and number of shares subscribed by each shareholder;
(iii) In the case of shares in paper form, the serial number of the shares; and
(iv) The date on which each shareholder acquired the shares.
Allotment and Issue of Shares
All shares in a joint stock limited company shall be issued in accordance with the principles
of equality and fairness. The same class of shares must have equal rights. The same shares must be
issued on the same terms and at the same price. A joint stock limited company may issue shares at
face value or premium, but not below face value.
If a domestic enterprise issues a listing abroad, it shall file a filing with the CSRC in
accordance with the Overseas Listing Measures, submit a filing report, legal opinion and other
relevant materials, and give a true, accurate and complete description of the shareholder
information. Where a domestic enterprise is issued directly and listed abroad, the issuer shall file
with the CSRC. Where a domestic enterprise is listed indirectly outside China, the issuer shall
designate the main business entity in China as the responsible person in China and file the case
with the CSRC.
Increase in Share Capital
According to the Company Law, where a joint stock limited company issues new shares, the
Shareholders’ meeting shall decide on the type and number of new shares, the price of the issue of
new shares, the commencement and end dates for the issue of new shares and the type and number
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--- page 654 ---
of newshares to be issued to the original shareholders. If no denominated shares are issued, the
funds raised by the issue of new shares shall be included in the registered capital. The company
shall be registered with the securities regulatory agency under the State Council for the public
offering of shares, and shall announce the prospectus. The prospectus shall be accompanied by the
articles of association and set forth the following:
(i) The total number of shares issued;
(ii) The par value and issue price of par value shares or the issue price of no par value
shares;
(iii) The purpose of the fund raised;
(iv) Rights and obligations of the shareholder;
(v) The type of shares and their rights and obligations;
(vi) When the Initial Public Offering is due and the IPO is overdue, the subscriber may
withdraw the offer. Where a company issues shares at the time of establishment, it shall
also state the number of shares subscribed by the promoter.
Reduction of Share Capital
The company may reduce its registered capital in accordance with the following procedures
under the Company Law:
(i) Prepare balance sheets and property lists;
(ii) The company makes a resolution at the Shareholders’ meeting to reduce its registered
capital;
(iii) The company shall notify creditors within 10 days of approval of the resolution on
reduction of registered capital and issue announcements in newspapers or on the
National Enterprise Credit Information Publicity System within 30 days;
(iv) The creditor has the right to require the company to pay the debt or provide the
corresponding security within 30 days of receipt of the notice, and if the creditor does
not receive the notice, to require the company to pay the debt or provide the
corresponding security within 45 days of the announcement;
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--- page 655 ---
(v) When the company reduces its registered capital, it shall register the changes with the
company registration authority in accordance with the law.
Where a company reduces its registered capital, it shall reduce its capital contribution or
shares in accordance with the proportion of its Shareholders’ capital contributions or holdings,
except as otherwise stipulated by law, otherwise agreed by all shareholders of a limited liability
company or otherwise stipulated by the articles of association of a joint stock limited company.
Share Buy-Back
According to the Company Law, a company may not purchase its own shares. Except in the
following cases:
(i) Reduction of registered capital;
(ii) Merging with other companies holding shares in the company;
(iii) The use of shares in employee ownership schemes or equity incentives;
(iv) A shareholder who votes against the merger or separation resolution of the company
passed by the Shareholders’ meeting shall have the right to require the company to
acquire the shares it holds;
(v) The shares are used to convert convertible corporate bonds issued by the listed
company;
(vi) Necessary to safeguard the corporate value and shareholder rights of listed companies.
The purchase of shares in the company for the reasons (i) to (ii) above shall be subject to a
resolution of the Shareholders’ meeting; For the reasons of (iii), (v) and (vi) above, the purchase
of shares in the company may, in accordance with the articles of association or the authorization of
the Shareholders’ meeting, be determined by the meeting of the board of directors attended by
more than two thirds of the directors.
If the company repurchases the shares of the company in accordance with the above
provisions, in the case of item (i) above, it shall be cancelled within 10 days from the date of
repurchase; In the case of items (ii) and (iv) above, it shall be transferred or cancelled within six
months; In the case of items (iii), (v) and (vi) above, the total number of shares held by the
company shall not exceed 10% of the total number of shares issued by the company and shall be
transferred or cancelled within 3 years.
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Transfer of Shares
Shares held by shareholders may be transferred in accordance with the law. Pursuant to the
Company Law, the transfer of shares by shareholders shall be effected on a legally established
securities exchange or in other ways as prescribed by the State Council. The transfer of shares
shall be effected by the shareholders by means of endorsement or other means as prescribed by
laws and administrative regulations. After the transfer, the company shall enter the name and
domicile of the transferee in the register of shareholders. No change in the register of shareholders
as provided for in the preceding paragraph may be registered within 20 days prior to the date of
the Shareholders’ meeting or within 5 days prior to the date on which the company decides to
distribute dividends. If any law, administrative regulation or the securities regulatory authority of
the State Council has other provisions on the registration of changes in the register of shareholders
of a listed company, such provisions shall apply.
According to the Company Law, shares issued prior to the public offering of shares of the
company shall not be transferred for 1 year from the date on which the shares of the company are
listed and traded on the stock exchange. The directors, supervisors and senior management of the
company shall declare to the company their holdings and changes therein. During the term of
office determined at the time of his/her appointment, the shares transferred each year shall not
exceed 25% of the total number of shares held by the company. The shares held by the directors,
supervisors and senior management of the company shall not be transferred for 1 year from the
date of listing and trading on the stock exchange. No share in the company held by the
aforementioned person shall be transferred within 6 months after his/her separation from office.
Where the shares are pledged within the time limit of a restrictive transfer prescribed by law
or administrative regulations, the applicant shall not exercise the right of pledge within that time
limit.
Shareholders
According to the Company Law and the Guidelines for Articles of Association, the rights of
shareholders of a company include:
(i) Dividends and other forms of distribution of benefits in proportion to shareholding;
(ii) To request, convene, preside over, participate in or appoint a shareholder’s
representative to the Shareholders’ meeting in accordance with the law, and to exercise
the corresponding voting rights;
(iii) Supervise the business operations of the company, make suggestions or raise questions;
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--- page 657 ---
(iv) Transfer, grant or pledge shares in the company in accordance with laws, administrative
regulations and articles of association;
(v) To access and copy the articles of association, the register of shareholders, the minutes
of the Shareholders’ meeting, the resolution of the meeting of the board of directors, the
resolution of the meeting of the board of supervisors and the financial and accounting
report;
(vi) Shareholders who hold more than 3% of the company’s shares individually or
collectively for more than 180 consecutive days may, in accordance with the law,
consult the company’s accounting books and accounting certificates;
(vii) Participation in the distribution of the remaining property of the company in the event
of the company’s suspension or liquidation;
(viii) Shareholders who object to the merger or separation resolution of the company made by
the Shareholders’ meeting and require the company to acquire its shares;
(ix) Laws, administrative regulations, departmental regulations, rules governing the place of
listing of shares of the company or other rights under the articles of association.
The obligations of the company’s shareholders include:
(i) Compliance with laws, administrative regulations and the articles of association;
(ii) To pay contributions in accordance with the shares subscribed and the method of
admission;
(iii) Not to abuse Shareholders’ rights to the detriment of the interests of the company or
other shareholders; and not to abuse the company’s status as an independent legal entity
and Shareholders’ limited liability to the detriment of the interests of the company’s
creditors;
(iv) Other obligations as stipulated by laws, administrative regulations and the articles of
association.
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--- page 658 ---
Shareholders’ meetings
According to the Company Law, the Shareholders’ meeting of a joint stock limited company
is composed of all shareholders. The Shareholders’ meeting is the authority of the company and
exercises the following powers and functions:
(i) Electing and removing directors and supervisors, and deciding on matters relating to the
remuneration of directors and supervisors;
(ii) Review and approve the report of the board of directors;
(iii) To review and approve the report of the board of supervisors;
(iv) Reviewing and approving the company’s profit distribution plan and loss recovery plan;
(v) To resolve on the increase or decrease of the registered capital of the company;
(vi) To resolve on the issuance of bonds of the company;
(vii) To resolve on the merger, demerger, dissolution, liquidation or change of corporate form
of the company;
(viii) To amend the articles of association;
(ix) Other powers and functions as provided for in the articles of association.
Pursuant to the Company Law, an annual general meeting must be convened once a year. An
extraordinary shareholders’ meeting must be convened within 2 months if any of the following
circumstances occurs:
(i) The number of directors is less than the number required by the company Law or less
than two-thirds of the number required by the articles of association;
(ii) The company’s uncompensated losses have reached one-third of the total amount of its
paid-up share capital;
(iii) At the request of shareholders who individually or collectively hold 10% or more of the
company’s shares;
(iv) When deemed necessary by the board of directors;
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--- page 659 ---
(v) The board of supervisor proposes to convene a meeting;
(vi) Other circumstances as stipulated in the articles of association.
Meetings of the Shareholders’ meeting shall be convened by the board of directors and
presided over by the chairman of the board of directors; if the chairman of the board of directors is
unable to perform his duties or refuses to perform his duties, the vice-chairman of the board of
directors shall preside over the meeting; if the vice-chairman of the board of directors is unable to
perform his duties or refuses to perform his duties, the board of directors shall preside over the
meeting by a director elected jointly by a majority of the directors.
If the board of directors is unable to perform or fails to perform its duty to convene a
Shareholders’ meeting, the board of supervisor shall convene and preside over the meeting in a
timely manner; in the event that the board of supervisor fails to convene and preside over the
meeting, the shareholders who have held more than 10% of the company’s shares, individually or
in aggregate, for a period of more than 90 consecutive days, may do so on their own.
If shareholders who individually or collectively hold more than 10% of the shares of the
company request to convene an extraordinary Shareholders’ meeting, the board of directors or the
board of supervisor shall decide whether to convene an extraordinary Shareholders’ meeting and
reply to the shareholders in writing within 10 days after receipt of the request.
Shareholders shall be notified of the time and place of a Shareholders’ meeting and the
matters to be considered 20 days prior to the meeting, and shareholders shall be notified of an
extraordinary Shareholders’ meeting 15 days prior to the meeting.
Shareholders who individually or collectively hold more than 1% of the shares of the
company may propose an interim proposal and submit it in writing to the board of directors 10
days prior to the date of the Shareholders’ meeting. An interim proposal shall have a clear topic
and specific resolutions. The board of directors shall notify other shareholders of the proposal
within 2 days of receipt of the proposal and submit the provisional proposal to the Shareholders’
meeting for deliberation; unless the provisional proposal violates the laws, administrative
regulations or the Articles of Association, or falls outside the terms of reference of the
Shareholders’ meeting. The company shall not increase the shareholding ratio of the shareholders
submitting the interim proposal. In the case of a public offering of shares, the company shall give
notice of the foregoing provisions by means of a public announcement. The Shareholders’ meeting
shall not resolve on matters not specified in the notice.
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--- page 660 ---
Pursuant to the Company Law, shareholders may appoint agents to attend the Shareholders’
meeting. Agents must submit a power of attorney to the company and exercise voting rights within
the authorized scope. The Company Law does not specify the number of shareholders required to
form a quorum for a Shareholders’ meeting.
Pursuant to the Companies Law, shareholders have one vote for each share held at a
Shareholders’ meeting, except for class shareholders. However, shares held by the company do not
carry voting rights.
In the election of directors and supervisors by the Shareholders’ meeting, the cumulative
voting system may be adopted in accordance with the provisions of the articles of association or
the resolutions of the Shareholders’ meeting. Under the cumulative voting system, each share shall
have voting rights equal in number to the number of directors or supervisors to be elected, and the
shareholders may concentrate their voting rights.
In accordance with the Company Law and the Guidelines for Articles of Association, the
passing of any resolution requires the affirmative vote of more than half of the voting rights
represented by the shareholders present at the Shareholders’ meeting. Matters relating to the
merger, demerger or dissolution of a company, the increase or reduction of registered capital, the
change of corporate form or the amendment of the articles of association must be passed by more
than two-thirds of the votes held by the shareholders present at the meeting.
Board of directors
According to the Company Law, the joint stock limited company shall have a board of
directors consisting of more than 3 members. The term of office of directors shall be prescribed by
the articles of association, but each term shall not exceed 3 years. Directors may be re-elected for
a second term.
Board of director’s meetings shall be held at least twice a year. All directors and supervisors
shall be notified 10 days in advance of each meeting. The board of directors shall exercise the
following powers and duties:
(i) To convene Shareholders’ meetings and report on its work to the Shareholders’
meetings;
(ii) To execute the resolutions of the Shareholders’ meetings;
(iii) To decide on the company’s business plan and investment plan;
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--- page 661 ---
(iv) To formulate the annual financial budget and final accounts of the company;
(v) To formulate the company’s profit distribution plan and loss recovery plan;
(vi) To formulate proposals for the increase or reduction of the registered capital of the
company and the issuance of corporate bonds;
(vii) To formulate proposals for the merger, demerger, dissolution or change of corporate
form of the company;
(viii) To decide on the establishment of the internal management organization of the company;
(ix) To decide on the appointment or dismissal of the manager of the company and his
remuneration, and to decide on the appointment or dismissal of the deputy manager and
financial controller of the company and their remuneration based on the nomination of
the manager;
(x) To formulate the basic management system of the company;
(xi) Other powers and duties as provided for in the articles of association or approved by the
Shareholders’ meeting.
The board meeting shall be held only when more than half of the directors are present. If a
director is unable to attend due to certain reasons, they may authorize another director in writing
to attend on their behalf, and the authorization letter should specify the scope of authority. If a
resolution of the board violates laws, administrative regulations, or the articles of association, or
resolutions of the Shareholders’ meeting, causing serious losses to the company, the directors who
participated in the resolution shall bear compensation liability to the company. However, if it can
be proven that the director expressed dissent at the time of voting and this was recorded in the
minutes, the director may be exempt from liability.
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--- page 662 ---
According to the Company Law, the following persons are not allowed to be directors of the
company:
(i) Incapacity or limitation of capacity for civil conduct;
(ii) Having been sentenced to criminal punishment for corruption, bribery, embezzlement of
property, misappropriation of property, or disruption of the socialist market economic
order, or having been deprived of political rights due to a crime, and less than five years
have elapsed since the completion of the sentence, or in case of a probation, less than
two years have elapsed since the expiration of the probation period;
(iii) If he or she is a director, factory director or manager of a company or enterprise in
bankruptcy or liquidation, and is personally responsible for the bankruptcy of the
company or enterprise, not more than 3 years have elapsed since the date of completion
of the bankruptcy or liquidation of the company or enterprise;
(iv) If he/she is the legal representative of a company or enterprise whose business license
has been revoked or which has been ordered to close down due to violation of the law
and he/she is personally liable for the bankruptcy of the company or enterprise, not
more than 3 years have elapsed since the date on which the business license of the
company or enterprise has been revoked; and
(v) The individual is classified by the People’s Court as a “Default Enforcer” for having a
debt of a relatively large amount that has not been settled by the due date.
According to the Company Law and the Guidelines for the Articles of Association, the board
of directors shall have a chairman, who shall be elected by more than half of the directors. The
chairman of the board shall exercise the following powers and duties (including but not limited
to):
(i) Presiding over the Shareholders’ meetings and convening and chairing the board of
directors’ meetings;
(ii) Supervise and inspect the implementation of the resolutions of the board of directors;
(iii) Exercising other powers granted by the board.
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--- page 663 ---
Managers and Senior Management
According to the Company Law, a company shall have a manager who shall be appointed or
dismissed by the board of directors. The manager shall be responsible to the board of directors and
exercise his functions and powers in accordance with the provisions of the articles of association
or authorized by the board of directors. The manager shall attend the board of directors meeting as
a non-voting member.
According to the Guidelines for Articles of Association, the manager is accountable to the
board of directors and exercises the following powers and functions:
(i) To preside over the production and operation management of the company, organize the
implementation of the resolutions of the board of directors, and report to the board of
directors;
(ii) To organize and implement the company’s annual business plan and investment plan;
(iii) To formulate the plan for the establishment of internal management bodies of the
company;
(iv) To formulate the basic management system of the company;
(v) To formulate specific regulations of the company;
(vi) To request the board of directors to appoint or dismiss the deputy manager and the
financial controller of the company;
(vii) To decide to appoint or dismiss management personnel other than those who shall be
appointed or dismissed by decision of the board of directors;
(viii) Other powers and functions conferred by these articles of association or the board of
directors. The manager attends the meetings of the board of directors.
According to the Company Law, senior management refers to the manager, deputy manager,
financial controller, secretary of the board of directors of the company and other officers as
stipulated in the articles of association.
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--- page 664 ---
Duties of Directors, Supervisors and Senior Management
The Company Law requires that directors, supervisors and senior management of a company
shall comply with relevant laws, regulations and the articles of association, and shall assume the
obligations of loyalty and diligence towards the company. Directors, supervisors and senior
management shall not take advantage of their duties to accept bribes or other illegal incomes, and
shall not misappropriate the company’s property.
Directors, supervisors and senior management shall not engage in the following acts:
(i) Misappropriating the company’s property or misappropriating the company’s funds;
(ii) Opening accounts and depositing company funds in their personal name or in the name
of other individuals;
(iii) Using his official position to bribe or accept other illegal income;
(iv) Accepting commissions from third parties for transactions with the company and
keeping them for himself/herself;
(v) Unauthorized disclosure of confidential business information of the company; or
(vi) Breaching the duty of loyalty to the company.
Matters relating to the conclusion of contracts or transactions shall be reported to the board
of directors or the Shareholders’ meeting and resolved by the board of directors or the
Shareholders’ meeting in accordance with the provisions of the articles of association.
The provisions of the preceding paragraph shall apply to any close family member of a
director, supervisor or senior management, any enterprise directly or indirectly controlled by a
director, supervisor or senior management or their close family members, and any connected
person who has any other relationship with a director, supervisor or senior management, who
enters into a contract or transaction with the company.
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--- page 665 ---
Directors, supervisors or senior management shall not make use of the convenience of their
duties to obtain for themselves or others any business opportunities belonging to the company.
However, except under one of the following circumstances:
(i) Reported to the board of directors or the Shareholders’ meeting and approved by a
resolution of the board of directors or the Shareholders’ meeting in accordance with the
provisions of the articles of association; or
(ii) The business opportunity cannot be exploited by the company in accordance with laws,
administrative regulations or the articles of association.
A director, supervisor or senior management may not engage in the same type of business as
the company in which he/she works on his/her own account or for others without reporting to the
board of directors or Shareholders’ meeting and obtaining a resolution from the board of directors
or Shareholders’ meeting in accordance with the provisions of the articles of association.
Directors, supervisors or senior management who violate laws, administrative regulations or
the articles of association in the performance of their duties with the company and cause losses to
the company shall be liable for compensation.
Finance and Accounting
Pursuant to the Company Law, the company shall establish its own financial and accounting
system in accordance with the laws, administrative regulations and the regulations of the Ministry
of Finance of the State Council. The company shall prepare a financial accounting report at the
end of each accounting year, which shall be audited by a public accounting firm in accordance
with the law. The financial and accounting reports shall be prepared in accordance with the laws,
administrative regulations and the regulations of the financial department of the State Council.
The financial accounting report of the joint stock limited company shall be filed with the
company for Shareholders’ inspection 20 days prior to the annual general meeting; the joint stock
limited company that makes a public offering of shares must announce its financial and accounting
reports.
When the company distributes after-tax profits in the current year, 10% of the profits shall be
drawn into the company’s statutory provident fund. Where the accumulated amount of the
company’s statutory provident fund is more than 50% of the company’s registered capital, it may
no longer be withdrawn. Where the statutory provident fund of the company is not sufficient to
compensate for the previous annual losses, the company shall make up the losses with the current
annual profits before withdrawing the statutory provident fund in accordance with the provisions
APPENDIX IV SUMMARY OF PRINCIPAL LAWS AND REGULATORY PROVISIONS
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--- page 666 ---
of the preceding paragraph. After the company draws the statutory provident fund from the
after-tax profit, it may withdraw any provident fund from the after-tax profit through the
Shareholders’ meeting or the resolution of Shareholders’ meeting.
A joint stock limited company shall distribute profits in accordance with the proportion of
shares held by shareholders, except as provided in the articles of association of a joint stock
limited company.
The premium amount earned by a joint stock limited company by issuing shares in excess of
the denomination of the stock ticket, the amount of share income not included in the registered
capital in the issue of non-denominated shares and other income included in the capital provident
fund as prescribed by the financial department of the State Council shall be listed as the capital
provident fund of the company.
The company’s provident fund is used to cover the company’s losses, expand the company’s
production and operation, or increase the company’s capital. If the provident fund makes up the
losses of the company, it shall first use any provident fund and the statutory provident fund; If it is
still irreparable, the capital provident fund may be used in accordance with the relevant provisions.
The statutory provident fund shall not retain less than 25% of the registered capital of the
company prior to the conversion of the statutory provident fund to increase the registered capital.
The company shall not establish separate accounting books except those prescribed by law.
Appointment and Dismissal of Accounting Firms
According to the Company Law, the appointment or dismissal of the accounting firm
responsible for the company’s audit shall be determined by the Shareholders’ meeting, the board of
directors or the board of supervisors in accordance with the provisions of the articles of
association. When a shareholder’s meeting, board of directors or board of supervisors votes on the
dismissal of an accounting firm, the firm shall be allowed to present its opinion. The company
shall provide true and complete accounting credentials, accounting books, financial and accounting
reports and other accounting information to the accounting firm it employs, and shall not refuse,
conceal or falsely report the information.
The Guidelines for Articles of Association stipulates that the company shall guarantee the
provision of true and complete accounting certificates, accounting books, financial and accounting
reports and other accounting information to the accounting firm engaged in the company, and shall
not refuse, conceal or falsely report. The auditing expenses of the accounting firm shall be
determined by the Shareholders’ meeting.
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--- page 667 ---
Profit Distribution
The Guidelines for Articles of Association stipulates that where a company distributes profits
to shareholders in violation of the provisions of the Company Law, the shareholders shall return
the profits allocated in violation of the provisions to the company, and the shareholders and the
directors, supervisors and senior management responsible for the losses caused by the company
shall be liable for compensation.
Dissolution and Liquidation
Under the Company Law, companies are dissolved for the following reasons:
(i) The expiration of the term of business specified in the articles of association or other
reasons for dissolution as stipulated in the articles of association;
(ii) Dissolution by a resolution of the Shareholders’ meeting;
(iii) Dissolution due to merger or separation of the company;
(iv) The business license has been revoked or ordered to close or revoked in accordance with
the law;
(v) Where serious difficulties occur in the operation and management of the company and
the continued existence of the company causes significant losses to the interests of the
shareholders, which cannot be resolved by other means, shareholders holding more than
10% of the voting rights of all the shareholders of the company may request the
people’s court to dissolve the company.
The company shall, within 10 days after the occurrence of any matter specified in the
preceding paragraph, publicize the matter through the National Enterprise Credit Information
Publicity System.
If the company is dissolved in accordance with subparagraph (i) above, it may survive by
amending its articles of association or by resolution of the Shareholders’ meeting, and the
amendments to the articles of association shall be adopted by more than two thirds of the voting
rights held by the shareholders present at the Shareholders’ meeting. If the company is dissolved
as required by subparagraphs (i), (ii), (iv) or (v) above, it shall be liquidated. The directors shall
be the obligors for the company’s liquidation and must form a liquidation group for liquidation
within 15 days from the date of the emergence of the cause of dissolution. The liquidation group
shall be composed of directors, unless otherwise stipulated in the articles of association or
APPENDIX IV SUMMARY OF PRINCIPAL LAWS AND REGULATORY PROVISIONS
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--- page 668 ---
otherwise decided by the Shareholders’ meeting. If the liquidation obligor fails to perform the
liquidation obligation in a timely manner and causes loss to the company or creditor, it shall be
liable for compensation.
The liquidation group fails to be formed for liquidation within the time limit or fails to carry
out the liquidation after its formation, any interested party may apply to the people’s court to
appoint the person concerned to form a liquidation group for liquidation. The people’s court shall
accept the application and organize the liquidation team to carry out the liquidation in a timely
manner.
The liquidation group exercises the following functions during liquidation:
(i) To clean up the property of the company and prepare the balance sheet and property list
respectively;
(ii) To notify creditors and issue public announcements;
(iii) To deal with the outstanding business of the company in connection with the
liquidation;
(iv) To pay the tax owed and the tax arising from the liquidation process;
(v) To clear up the claims and debts;
(vi) To dispose of the remaining property of the company after it has discharged its debts;
(vii) To represent the company in civil proceedings.
The liquidation group shall notify the creditors of the company within 10 days from the date
of its establishment, and within 60 days in the newspaper or the National Enterprise Credit
Information Publicity System. The creditor shall, within 30 days from the date of receipt of the
notice, declare its claims to the liquidation group within 45 days from the date of the
announcement. When a creditor files a claim, it shall state the relevant matters of the claim and
provide supporting materials. The liquidation group shall register the claims. The liquidation group
shall not liquidate creditors during the period of filing of claims.
The company’s property shall be distributed according to the proportion of shares held by
shareholders after paying the liquidation expenses, wages of employees, social insurance expenses
and statutory compensation respectively, paying the taxes owed, and liquidating the remaining
property after paying off the company’s debts.
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--- page 669 ---
During the liquidation period, the company continues, but cannot carry out business activities
unrelated to the liquidation. The company’s property will not be allocated to shareholders until it
has been liquidated as stipulated in the preceding paragraph.
After the liquidation group has cleared up the company’s assets and prepared a balance sheet
and an inventory of assets, if it finds that the company’s assets are insufficient to pay off its debts,
it shall apply to the people’s court for declaring bankruptcy according to law. After the company is
declared bankrupt by the people’s court, the liquidation group shall transfer the liquidation affairs
to the bankruptcy administrator designated by the people’s court.
After the liquidation of a company is completed, the liquidation group shall prepare a
liquidation report, which shall be confirmed by the Shareholders’ meeting or the people’s court and
submitted to the company registration authority for application for cancellation of the company
registration.
If a company has its business license revoked, ordered to close, or dissolved, and fails to
apply for deregistration with the company registration authority within 3 years, the company
registration authority may announce this through the National Enterprise Credit Information
Publicity System, with the announcement period lasting no less than 60 days. After the
announcement period expires and there are no objections, the company registration authority can
cancel the company registration. In cases where the company registration is canceled according to
regulations, the responsibilities of the original shareholders and liquidation obligors remain
unaffected.
Members of the liquidation group shall be loyal to their duties and perform liquidation
obligations according to law. Members of the liquidation group shall not use their authority to
accept bribes or other illegal income, nor shall they embezzle company’s property. Members of the
liquidation group who cause losses to the company or creditors due to intentional or gross
negligence shall be liable for compensation.
Overseas Listing
According to the Overseas Listing Measures, if an issuer makes its initial public offering or
listing overseas, it must file with the CSRC within 3 working days after submitting the application
documents for issuance and listing overseas. If the issuer issues securities in the same overseas
market after its initial public offering or listing, it must file with the CSRC within 3 working days
after the completion of the issuance. If the issuer lists in other overseas markets after its initial
public offering or listing, it must file as required. In addition, if the filing materials are complete
and comply with regulations, the CSRC will complete the filing process within 20 working days
from the date of receipt and publish the filing information on its website. If the filing materials are
APPENDIX IV SUMMARY OF PRINCIPAL LAWS AND REGULATORY PROVISIONS
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--- page 670 ---
incomplete or do not comply with regulations, the CSRC will inform the issuer of the additional
materials needed within 5 working days after receiving the filing materials. The issuer must
supplement the materials within 30 working days.
Loss of Share Certificates
If the registered share certificates are stolen, lost or damaged, the shareholders may, in
accordance with the public notice procedure prescribed in the Civil Procedure Law of the PRC,
request the people’s court to declare such share certificates invalid. After the people’s court
declares such share certificates invalid, the shareholders may apply to the company for reissuance
of the share certificates.
Suspension and Termination of Listing
The Company Law has deleted provisions concerning the suspension and termination of
listing. The Securities Law of the PRC (2019 Revision) (ج2019)
(the “ Securities Law ”) has also deleted provisions concerning the suspension of listing. If listed
securities fall under delisting circumstances as defined by the stock exchange, the stock exchange
shall terminate their listing and trading in accordance with its business rules.
According to the Overseas Listing Measures, if the issuer voluntarily terminates listing or
forcibly terminates listing, it shall report the specific situation to the CSRC within 3 working days
from the date of occurrence and announcement of the relevant matters.
SECURITIES LAW AND REGULATIONS
In October 1992, the State Council established the Securities Regulatory Commission and the
CSRC. The Securities Regulatory Commission was responsible for coordinating the drafting of
securities regulations, formulating policies related to securities, planning the development of the
securities market, guiding, coordinating, and supervising all securities-related institutions in China,
and managing the CSRC. The CSRC is the regulatory body of the Securities
RegulatoryCommission, tasked with drafting regulatory provisions for the securities market,
overseeing securities firms, supervising Chinese companies’ public offerings of securities both
domestically and internationally, standardizing securities trading, compiling statistical data related
to securities, and conducting relevant research and analysis. In April 1998, the State Council
merged these two departments and reorganized them into the CSRC.
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The Interim Regulations on the Administration of Stock Issue and Trading (׸
၍ଣᅲБૢԷ) promulgated by the State Council and effective on April 22, 1993 stipulate the
application and approval procedures for public stock issue, the trading of stocks, the acquisition of
listed companies, the custody, liquidation and transfer of listed stocks, the information disclosure,
investigation and punishment of listed companies and the arbitration of disputes.
The Regulations of the State Council Concerning Listed Foreign Capital Shares in the
Territory of a Joint Stock Limited Company (஝
), promulgated by the State Council and effective on December 25, 1995, mainly provide for
the issuance, subscription, trading, dividend payment of domestic listed foreign capital shares, as
well as the disclosure of information of joint stock limited companies with domestic listed foreign
capital shares.
The Securities Law, revised by the SCNPC on December 28, 2019, and effective on March 1,
2020, includes a series of regulations concerning, among other things, the issuance and trading of
securities in China, the acquisition of listed companies, stock exchanges, securities firms, and the
responsibilities and duties of the State Council’s securities regulatory body, comprehensively
overseeing activities in China’s securities market. The Securities Law stipulates that domestic
enterprises issuing securities directly or indirectly overseas or listing their securities for trading
abroad must comply with the relevant provisions of the State Council. Currently, the issuance and
trading of shares issued overseas are mainly regulated by rules and regulations issued by the State
Council and the CSRC.
ARBITRATION AND ENFORCEMENT OF ARBITRAL AWARDS
According to the Arbitration Law of the PRC () (the “ Arbitration
Law”), which was revised by the SCNPC on September 1, 2017, and came into effect on January
1, 2018, the Arbitration Law applies to foreign-related economic disputes where the parties have
entered into a written agreement to submit matters for arbitration to an arbitration commission
established under the Arbitration Law. Before the China Arbitration Association formulates
arbitration rules, the arbitration commission may formulate provisional arbitration rules in
accordance with the provisions of the Arbitration Law and the Civil Procedure Law of the PRC. If
one party chooses arbitration to resolve a dispute and one party files a lawsuit with the people’s
court, the people’s court shall not accept it.
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According to the Arbitration Law, arbitration operates on a one-arbitration-final system,
binding all parties involved. If one party fails to comply with the award, the other party may apply
to the people’s court for enforcement of the arbitration award under the Civil Procedure Law of the
PRC. If the arbitration procedure is illegal (including the composition of the arbitration committee
violating legal procedures, matters decided not falling within the scope of the arbitration
agreement, or the arbitration committee having no authority to arbitrate), the people’s court may
rule not to enforce the arbitration decision made by the arbitration committee. If one party seeks to
enforce an arbitral award from a foreign arbitration institution against another party, and the
respondent or their property is not within the territory of the PRC, the parties shall directly apply
to a competent foreign court for recognition and enforcement. Similarly, the people’s court may
recognize and enforce an arbitral award made by a foreign arbitration institution based on the
principle of reciprocity or any international treaty signed or acceded to by China.
Pursuant to the Arrangement of the Supreme People’s Court on Mutual Enforcement of
Arbitral Awards between the Mainland and the Hong Kong Special Administrative Region ( ௰৷
τર ) promulgated by the Supreme
People’s Court on January 24, 2000 and effective on February 1, 2000, and the Supplementary
Arrangement of the Supreme People’s Court on Mutual Enforcement of Arbitral Awards between
the Mainland and the Hong Kong Special Administrative Region (ಥ
໾̂τર ), promulgated by the Supreme People’s Court on
November 26, 2020 and effective on November 27, 2020, an award made by an arbitration
institution in Chinese mainland may be executed in Hong Kong, Hong Kong arbitral awards may
also be enforced in Chinese mainland.
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--- page 673 ---
This Appendix contains a summary of major provisions of the Articles of Association. This
Appendix mainly provides potential investors with an overview on the Articles of Association. It
may not contain all the information that may be important to potential investors.
ISSUANCE OF SHARES
The issuance of shares of the Company shall be subject to the principles of openness, fairness
and impartiality and shall have the same rights as each share of the same class.
The same class of shares issued in the same issuance, with the same conditions and prices per
share; The subscribers pay the same price per share for the shares they subscribe to.
INCREASE, DECREASE AND REPURCHASE OF SHARES
In accordance with the needs of operation and development and in accordance with the
provisions of laws and regulations, the Company may increase its capital by adopting the
following methods upon separate resolution by the Shareholders’ meeting:
(i) Issuing shares to unspecified persons;
(ii) Issuing shares to specific persons;
(iii) Distribution of bonus shares to existing shareholders;
(iv) Increase the share capital by transferring the Company’s reserve fund;
(v) Other methods prescribed by laws and administrative regulations and the securities
regulatory authority in the place where the Company’s shares are listed (if applicable).
The Company can reduce registered capital. The Company shall reduce its registered capital
in accordance with the Company Law of the People’s Republic of China (“Company Law” ) and
other relevant provisions and the procedures stipulated in the Articles of Association.
The Company may acquire shares of the Company in accordance with laws, administrative
regulations, departmental regulations and the provisions of these Articles of Association:
(i) Reducing the Company’s registered capital;
(ii) Merger with other companies holding shares in the Company;
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(iii) Use of shares in employee ownership schemes or equity incentives;
(iv) Where a shareholder objects to a resolution of the Shareholders’ meeting to merge or
separate the Company and requires the Company to acquire its shares;
(v) Corporate bonds used to convert shares issued by listed companies;
(vi) The Company is necessary to safeguard the Company’s value and shareholder’s rights
and interests.
Except in the aforementioned circumstances, the Company may not acquire shares in the
Company.
The acquisition of shares in a company may be done by means of public centralized trading,
or by laws and regulations and other means approved by the securities regulatory authority in the
place where the Company’s shares are listed.
Where the Company acquires shares in the Company as provided for in items (iii), (v) and
(vi) above, the Company shall proceed through a public centralized transaction.
Where the Company acquires shares in the Company as provided for in items (i) and (ii)
above, it shall be determined by the Shareholders’ Meeting; For the purposes of items (iii), (v) and
(vi) above, the acquisition of shares of the Company in the circumstances shall subject to the
applicable rules governing securities in the place where the Company’s shares are listed, be
determined by the meeting of the Board of Directors attended by more than two thirds of the
Directors in accordance with the provisions of the Articles of Association or the authorization of
the Shareholders’ meeting.
Where the Company acquires the shares of the Company in accordance with the above
provisions, in the case of item (i), it shall be cancelled within 10 days from the date of the
acquisition; in the case of items (ii) and (iv), it shall be transferred or cancelled within 6 months;
in the case of items (iii), (v) and (vi), the total number of shares of the Company held by the
Company shall not exceed 10% of the total number of shares issued by the Company and shall be
transferred or cancelled within 3 years.
TRANSFER OF SHARES
The shares of the Company shall be transferred according to law. All transfers of H shares
shall be in a general or ordinary form or any other written transfer document in a form accepted by
the Board (including the standard transfer format or transfer form as prescribed from time to time
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 2–


--- page 675 ---
by the HKEX); the transfer document may only be signed by hand or affixed with a valid seal of
the Company (e.g. the transferor or transferee is the Company). If the transferor or transferee is an
approved clearing house or its agent as defined in the relevant ordinance which shall come into
force from time to time in accordance with the laws of Hong Kong, the transfer document may be
signed by hand signature or machine printing. All transfer documents shall be placed at the legal
address of the Company or at such address as the Board may from time to time specify.
The Company shall not accept its shares as the subject of the right of pledge.
Shares issued prior to the public offering of shares of the Company shall not be transferred
for 1 year from the date on which the shares of the Company are listed and traded on the stock
exchange.
Directors and senior management of the Company shall declare to the Company the shares of
the Company held and the changes therein. The amount of shares transferred each year during the
term of office determined at the time of taking office shall not exceed 25% of the total number of
shares of the Company held; the shares of the Company held shall not be transferred within 1 year
from the date of the Company’s shares are listed and traded. No shares of the Company held by
the aforementioned personnel shall be transferred within six months after their separation. If any
change occurs in the direct holding of shares of the Company due to the distribution of rights and
interests of the Company, the aforementioned provisions shall still be observed.
Where the listing rules of the place of listing of the shares of the Company provide otherwise
for the transfer of the shares of the Company, the provisions thereof shall apply.
Where the Company’s Directors, senior management or shareholders who hold more than 5%
of the Company’s shares sell the Company’s shares they hold within six months of the relevant
purchase, or purchase any shares they have sold within six months of the relevant sale, the
proceeds generated therefrom shall be incorporated into the profits of the Company, and the
Company’s Board of Directors will recover its proceeds. However, where the securities company
holds more than 5% of the shares as a result of underwriting the purchase of the remaining shares
after sale, and in other cases as prescribed by the CSRC are excepted. Where the securities
regulatory rules in the place where the Company’s shares are listed is otherwise stipulated in the
rules governing the transfer of shares of the Company, the provisions thereof shall apply.
The shares of the Company or other securities of an equity nature held by the Directors,
senior management or natural person shareholders referred to in the preceding paragraph, including
shares of the Company held by their spouses, parents and children and other securities of an equity
nature held in the accounts of others.
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--- page 676 ---
Where the Board of Directors of the Company does not perform in accordance with the
provisions of paragraph 1 of this Article, the shareholders shall have the right to require the Board
of Directors to execute within 30 days. If the Board of Directors of the Company does not execute
within the aforementioned time limit, the shareholders shall have the right to bring a lawsuit
directly to the People’s Court in their own name for the benefit of the Company.
Where the Board of Directors of the Company does not perform in accordance with the
provisions of paragraph 1 of this Article, the Directors liable shall bear joint and several liabilities
according to law.
SHAREHOLDERS AND SHAREHOLDERS’ MEETINGS
General Provisions for Shareholders
The Company shall establish a register of shareholders on the basis of the certificates
provided by the securities registration and settlement organization. The register of shareholders is
sufficient evidence that the shareholders hold shares in the Company. The original register of
H-share shareholders is deposited in Hong Kong for the inspection of shareholders, but the
Company may suspend the registration of shareholders in accordance with the applicable laws and
regulations and the securities regulatory rules in the place where the Company’s shares are listed.
Shareholders have rights and obligations according to the class of shares they hold; Shareholders
holding the same class of shares shall have the same rights and obligations.
Shareholders of the Company have the following rights:
(i) To receive dividends and other distributions of profits in proportion to the shares held;
(ii) To legally request, convene, preside over, attend, or appoint a proxy to attend
Shareholders’ meetings and exercise corresponding rights to speak and vote (unless
individual shareholders are required to abstain from voting on specific matters under
applicable laws, administrative regulations, departmental rules, and securities regulatory
rules in the place where the company’s shares are listed);
(iii) To supervise the Company’s operations and make suggestions or inquiries;
(iv) To transfer, donate, or pledge their shares in accordance with the provisions of laws,
administrative regulations, and the Articles of Association;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 677 ---
(v) To consult and copy the Articles of Association, the shareholders’ register, minutes of
Shareholders’ meetings, resolutions of the Board of Directors, and financial accounting
reports in accordance with the provisions of this Articles of Association; shareholders
separately or jointly holding more than 3% of the Company’s shares for more than 180
consecutive days may request to consult the Company’s accounting books and
accounting vouchers in accordance with the law for legitimate purposes;
(vi) To participate in the distribution of the Company’s remaining assets in proportion to the
shares held upon termination or liquidation of the Company;
(vii) Shareholders who object to the resolution of the Shareholders’ meeting on the
Company’s merger or division may request the Company to repurchase their shares;
(viii) Other rights stipulated by laws, administrative regulations, departmental rules, securities
regulatory rules in the place where the Company’s shares are listed, or this Articles of
Association.
Where the content of the resolutions of the Shareholders’ meeting or the Board of Directors
of the Company violates laws or administrative regulations, shareholders have the right to request
the People’s Court to declare them invalid.
If the convening procedures or voting methods of the Shareholders’ meeting or the Board of
Directors violates laws, administrative regulations or these Articles of Association, or the contents
of the resolution violate these Articles of Association, the shareholders shall have the right to
request the People’s Court to revoke them within 60 days from the date of adoption of the
resolution. However, there are only minor flaws in the procedure for convening Shareholders’
meetings, Board meetings or voting methods, except where there is no material impact on the
resolution.
Where the relevant parties, such as the Board of Directors and shareholders, dispute the
validity of the resolution of the Shareholders’ meeting, they shall promptly file a lawsuit with the
People’s Court. Before the People’s Court makes a judgment or order to cancel the resolution, the
relevant parties shall implement the resolution of the shareholder’ meeting. The Company,
Directors and senior management shall perform their duties effectively to ensure the normal
operation of the Company.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 678 ---
Where the People’s Court makes a judgment or order on a related matter, the Company shall
perform its information disclosure obligations in accordance with laws, administrative regulations,
the CSRC and the stock exchange, fully explain the impact, and cooperate actively with the
execution of the judgment or ruling after its entry into force. Those involved in rectifying the
matter in advance will promptly handle and fulfill the corresponding disclosure obligations.
If a Director or senior management, excluding members of the audit committee, breaches
laws, administrative regulations, or the Articles of Association in the performance of their duties,
causing losses to the Company, shareholders separately or jointly holding more than 1% of the
Company’s shares continuously for more than 180 days have the right to request in writing that the
audit committee file a lawsuit with the People’s Court; If a member of the audit committee
breaches laws, administrative regulations, or the Articles of Association in the performance of their
duties, causing losses to the Company, the aforementioned shareholders may request in writing that
the Board of Directors file a lawsuit with the People’s Court.
The Audit Committee and the Board of Directors, upon receipt of a written request from the
shareholders specified in the preceding paragraph, refuse to initiate proceedings, or no action was
filed within 30 days from the date of receipt of the request, or if the situation is urgent and the
Company’s interests will be irreparably damaged if no immediate action is brought, The
shareholders provided for in the preceding paragraph have the right to bring a lawsuit directly to
the People’s Court in their own name for the benefit of the Company.
Where another person infringes upon the lawful rights and interests of the Company and
causes loss to the Company, the shareholders specified in the first paragraph of this Article may
file a lawsuit with the People’s Court in accordance with the provisions of the preceding two
paragraphs.
Directors, supervisors and senior management of wholly-owned subsidiaries of the Company
who perform their duties in violation of laws, administrative regulations or the provisions of these
Articles of Association, If it causes loss to the Company, or if another person infringes upon the
lawful rights and interests of the wholly-owned subsidiary of the Company causing loss to the
Company, a shareholder may, in accordance with the provisions of the first three paragraphs of
Article 189 of the Company Law, request in writing the board of supervisors and Board of
Directors of a wholly-owned subsidiary to bring an action in the People’s Court or directly to the
People’s Court in his own name.
Where a Director or senior management violates laws, administrative regulations or the
provisions of these Articles of Association and damages the interests of the shareholders, the
shareholder may file a lawsuit in the People’s Court.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 679 ---
Shareholders of the Company bear the following obligations:
(i) To comply with laws, administrative regulations and the Articles of Association;
(ii) To pay for shares in accordance with the amount of shares subscribed and the method of
capital contribution;
(iii) Except as otherwise stipulated by laws and regulations, not to withdraw its share capital;
(iv) Not to abuse shareholder rights to harm the interests of the Company or other
shareholders; not to abuse the independent legal person status of the Company and the
limited liability of shareholders to harm the interests of the Company’s creditors;
Where a shareholder of the Company abuses its shareholder rights, causing losses to the
Company or other shareholders, it shall be liable for compensation in accordance with
the law.
Where a shareholder of the Company abuses the independent legal person status of the
Company and the limited liability of shareholders to evade debts and seriously damages
the interests of the Company’s creditors, it shall bear joint and several liability for the
Company’s debts.
(v) Other obligations that shall be borne as stipulated by laws, administrative regulations,
the securities regulatory rules in the place where the Company’s shares are listed, and
the Articles of Association.
Controlling Shareholders and Actual Controllers
The Company’s controlling shareholders and actual controllers shall exercise their rights and
fulfill their obligations in accordance with laws, administrative regulations, and the rules of the
securities regulatory authority in the place where the Company’s shares are listed, and shall
safeguard the interests of the listed Company.
The Company’s controlling shareholders and actual controllers shall comply with the
following provisions:
(i) Exercise shareholder rights in accordance with the law, and shall not abuse control or
use related party relationships to harm the legitimate rights and interests of the
Company or other shareholders;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 680 ---
(ii) Strictly fulfill the public statements and various commitments made, and shall not
change or waive them without authorization;
(iii) Strictly perform information disclosure obligations in accordance with relevant
regulations, actively cooperate with the Company in information disclosure work, and
promptly inform the Company of significant events that have occurred or are planned to
occur;
(iv) Shall not occupy the Company’s funds in any way;
(v) Shall not compel, instruct, or require the Company and relevant personnel to provide
guarantees in violation of laws and regulations;
(vi) Shall not use the Company’s undisclosed significant information to seek benefits, shall
not disclose undisclosed significant information related to the Company in any way, and
shall not engage in insider trading, short-swing trading, market manipulation, and other
illegal and non-compliant activities;
(vii) Shall not harm the legitimate rights and interests of the Company and other shareholders
through non-fair related party transactions, profit distribution, asset restructuring,
external investment, or any other means;
(viii) Ensure the integrity of the Company’s assets, personnel independence, financial
independence, organizational independence, and business independence, and shall not
affect the Company’s independence in any way;
(ix) Other provisions of laws, administrative regulations, securities regulatory rules in the
place where the Company’s shares are listed, and these Articles of Association.
Where the controlling shareholder and the actual controller of the Company do not serve as
Directors of the Company but actually perform the Company’s affairs, the provisions of these
Articles of Association on the fiduciary duty and duty of care of Directors shall apply.
Where the controlling shareholder and the actual controller of the Company instruct the
Directors and senior management to engage in acts that harm the interests of the Company or
shareholders, they shall bear joint and several liability with the Directors and senior management.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 681 ---
General Provisions for Shareholders’ Meetings
The Shareholders’ meeting of the Company is composed of all shareholders. The
Shareholders’ meeting is the authority of the Company and shall exercise the following functions
and powers in accordance with the law:
(i) To elect and replace Directors and to decide on the remuneration of Directors;
(ii) To examine and approve the report of the Board of Directors;
(iii) To examine and approve the Company’s profit distribution plan and loss recovery plan;
(iv) To make resolutions on the increase or decrease of the registered capital of the
Company;
(v) To make resolutions on the issuance of corporate bonds, except for those authorized by
the Shareholders’ meeting to the Board of Directors;
(vi) To make resolutions on the merger, division, spin-off, dissolution, liquidation or change
of the Company’s form;
(vii) To amend these Articles of Association;
(viii) To make resolutions on the engagement and dismissal of the accounting firm
undertaking the Company’s audit business;
(ix) To examine and approve the guarantee matters that need to be examined and approved
by the Shareholders’ meeting as stipulated in these Articles of Association;
(x) To examine and approve the related transactions between the Company and related
parties (excluding the provision of guarantees) with an amount exceeding RMB30
million and accounting for more than 5% of the absolute value of the Company’s latest
audited net assets;
(xi) To examine and approve the matters of the Company’s purchase and sale of major assets
within one year involving the total assets or transaction amount exceeding 30% of the
Company’s latest audited total assets;
(xii) To examine and approve the matters of changing the use of raised funds;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 682 ---
(xiii) To examine and approve the equity incentive plan and employee stock ownership plan;
(xiv) To examine and approve other matters that should be decided by the Shareholders’
meeting as stipulated by laws, administrative regulations, departmental rules, securities
regulatory rules in the place where the Company’s shares are listed, or these Articles of
Association.
Unless otherwise provided by laws, administrative regulations, the provisions of the CSRC or
the securities regulatory rules in the place where the Company’s shares are listed, the
above-mentioned functions and powers of the Shareholders’ meeting shall not be exercised by the
Board of Directors or other institutions and individuals through authorization. The functions and
powers that are not legally exercised by the Shareholders’ meeting may be authorized to be
exercised by the Board of Directors after being examined and approved by the Shareholders’
meeting, and the content of the authorization shall be clear and specific.
The following external guarantee acts of the Company shall be submitted to the shareholders’
meeting for examination and approval after being examined and approved by the Board of
Directors:
(i) A guarantee with a single amount exceeding 10% of the Company’s latest audited net
assets;
(ii) Any guarantee provided after the total external guarantees of the Company and its
controlled subsidiaries exceed 50% of the Company’s latest audited net assets;
(iii) Any guarantee provided to a guarantee object with a debt-to-asset ratio exceeding 70%;
(iv) The total amount of external guarantee of the Company in a continuous 12 months
exceeds 50% of the Company’s latest audited net assets and the absolute amount
exceeds RMB50 million;
(v) The total amount of external guarantee of the Company in a continuous 12 months
exceeds 30% of the Company’s latest audited total assets;
(vi) Any guarantee provided to shareholders, actual controllers, and their related parties;
(vii) Other guarantee situations that need to be approved by the Shareholders’ meeting as
required by laws, regulations or regulatory authorities in the place where the
Company’sshares are listed.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 683 ---
Shareholders’ meetings are categorized into annual general meetings and extraordinary
general meetings. The annual general meeting shall be convened once a year and shall be held
within six months following the close of the preceding fiscal year.
The Company shall convene an extraordinary general meeting within two months from the
date of the occurrence of any of the following circumstances:
(i) The number of Directors is less than the number provided for in the Company Law or
less than two-thirds of the number prescribed in the Articles of Association;
(ii) The uncovered losses of our Company reach one-third of its total share capital;
(iii) A request from shareholders who separately or jointly holding more than 10% shares in
the Company;
(iv) The Board of Directors considers it necessary;
(v) The Audit Committee proposes that such a meeting shall be held;
(vi) Other circumstances conferred by the laws, administrative regulations, departmental
rules or the Articles of Association.
If the extraordinary general meeting is convened in accordance with the provisions of the
Company’s stock listing securities regulatory rules, the actual date of the meeting may be adjusted
according to the provisions of the Company’s stock listing securities regulatory rules.
Convening of Shareholders’ Meetings
The Board of Directors shall convene the Shareholders’ meeting within the prescribed time
limit.
With the consent of a majority of all independent Directors, independent Directors have the
right to propose to the Board of Directors the convening of an extraordinary general meeting.
Regarding the proposal of the independent Directors to convene an extraordinary general meeting,
the Board of Directors shall, in accordance with laws, administrative regulations and the
provisions of these Articles of Association, within 10 days of receipt of the proposal, either agree
or disagree with the written feedback of the meeting.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 684 ---
Where the Board of Directors agrees to convene an extraordinary general meeting, notice of
the Shareholders’ meeting will be issued within 5 days of the decision of the Board of Directors; If
the Board of Directors does not agree to convene an extraordinary general meeting, the reasons
will be stated and announced.
The Audit Committee shall have the right to propose to the Board the convening of an
extraordinary general meeting and shall submit it to the Board in writing. The Board of Directors
shall, in accordance with the provisions of laws, administrative regulations and these Articles of
Association, provide written feedback within 10 days after receiving the proposal, indicating
whether it agrees or disagrees to convene the extraordinary general meeting.
If the Board of Directors agrees to convene an extraordinary general meeting, it shall issue a
notice of the Shareholders’ meeting within 5 days of making the Board resolution, and any changes
to the original proposal in the notice shall be agreed upon by the Audit Committee.
If the Board of Directors does not agree to convene an extraordinary general meeting or fails
to provide feedback within 10 days of receiving the proposal, it shall be deemed that the Board of
Directors is unable or unwilling to perform its duties of convening the Shareholders’ meeting, and
the Audit Committee may convene and preside over the meeting on its own.
Shareholders who separately or jointly hold more than 10% of the Company’s shares
(excluding the treasury shares) request the Board of Directors to convene an extraordinary general
meeting and shall submit the request in writing to the Board of Directors. The Board of Directors
shall, in accordance with laws, administrative regulations, and the Articles of Association, provide
written feedback within 10 days after receiving the request, indicating whether it agrees or
disagrees to convene the extraordinary general meeting.
If the Board of Directors agrees to convene an extraordinary general meeting, it shall issue a
notice of the Shareholders’ meeting within 5 days of making the Board resolution, and any changes
to the original request in the notice shall be agreed upon by the relevant shareholders.
If the Board of Directors does not agree to convene an extraordinary general meeting or fails
to provide feedback within 10 days of receiving the request, shareholders who separately or jointly
hold more than 10% of the Company’s shares propose to the Audit Committee to convene an
extraordinary general meeting and shall submit the request in writing to the Audit Committee.
If the Audit Committee agrees to convene an extraordinary general meeting, it shall issue a
notice of the Shareholders’ meeting within 5 days of receiving the request, and any changes to the
original request in the notice shall be agreed upon by the relevant shareholders.
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If the Audit Committee fails to issue the notice of the Shareholders’ meeting within the
prescribed time limit, it shall be deemed that the Audit Committee shall not to convene and preside
over the Shareholders’ meeting, and shareholders separately or jointly holding more than 10% of
the Company’s shares for more than 90 consecutive days may convene and preside over the
meeting on their own.
If the Audit Committee or shareholders decide to convene the Shareholders’ meeting on their
own, they shall notify the Board of Directors in writing and the same time in accordance with the
securities regulatory rules in the place where the Company’s shares are listed and the regulations
of the stock exchange, complete the necessary reports, announcements or filings.
Before the announcement of the Shareholders’ meeting resolution, the shareholding ratio of
the convening shareholders shall not be less than 10%. The Audit Committee and convening
shareholders shall submit relevant proof materials to the Stock Exchange when issuing the notice
of the Shareholders’ meeting and the announcement of the Shareholders’ meeting resolution, at the
same time in accordance with the securities regulatory rules in the place where the Company’s
shares are listed and the regulations of the stock exchange, complete the necessary reports,
announcements or filings.
Proposals and Notices of Shareholders’ Meetings
The content of the proposals shall fall within the scope of the Shareholders’ meeting’s
authority, have clear topics and specific resolution matters, and comply with the provisions of
laws, administrative regulations, the securities regulatory rules in the place where the Company’s
shares are listed, and the Articles of Association.
When the Company convenes a Shareholders’ meeting, the Board of Directors, the Audit
Committee, and shareholders separately or jointly holding more than 1% of the Company’s shares
have the right to submit proposals to the Company.
Shareholders who separately or jointly hold more than 1% of the Company’s shares may
submit an interim proposal in writing to the convenor 10 days before the shareholders’ meeting.
The convenor shall issue a supplementary notice of the Shareholders’ meeting within 2 days of
receiving the proposal, informing the content of the interim proposal and submitting it for
deliberation at the Shareholders’ meeting. However, this does not apply if the interim proposal
violates laws, administrative regulations, or the Articles of Association, or if it is outside the scope
of the Shareholders’ meeting’s authority. If the Shareholders’ meeting needs to be postponed due to
the issuance of a supplementary notice as required by the securities regulatory rules in the place
where the Company’s shares are listed, the Shareholders’ meeting shall be postponed in accordance
with these rules.
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Except for the circumstances specified in the preceding paragraph, after the convener has
issued the notice of the Shareholders’ meeting, it shall not modify the proposals already listed in
the notice or add new proposals.
The Shareholders’ meeting shall not vote on or make resolutions regarding proposals that are
not listed in the notice of the Shareholders’ meeting or that do not comply with the provisions of
Article 58 of these Articles of Association.
The convener shall notify all shareholders by announcement 21 days before the annual
general meeting and 15 days before the extraordinary general meeting.
The starting period of the Company’s calculation shall not include the day on which the
meeting is held.
The notice of a Shareholders’ meeting includes the following:
(i) The time, place and duration of the meeting;
(ii) The matters and proposals to be discussed at the meeting;
(iii) In plain language: all ordinary Shareholders have the right to attend the Shareholders’
meeting, and may entrust a proxy in writing to attend the meeting and vote. Such a
proxy does not need to be a shareholder of the Company;
(iv) The equity registration date of the Shareholders entitled to attend the Shareholders’
meeting;
(v) The interval between the date of equity registration and the date of meeting shall not
exceed 7 working days. Once the date of equity registration is confirmed, it shall not be
changed;
(vi) Name and telephone number of the permanent contact person for conference affairs;
(vii) The voting time and procedure by network or other means;
The start time of voting by Shareholders’ meeting by network or other means shall not
be earlier than 3:00 p.m. the day before the on-site Shareholders’ meeting, and shall not
be later than 9:30 a.m. on the day of the on-site Shareholders’ meeting. The end time
shall not be earlier than 3:00 p.m. on the day of the on-site Shareholders’ meeting.
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--- page 687 ---
(viii) Relevant laws, regulations, rules and normative files as well as other contents stipulated
in the Articles of Association.
The notice and supplementary notice of the Shareholders’ meeting will fully and completely
disclose all specific contents of the proposals, as well as all materials or explanations necessary
for shareholders to make reasonable judgments on the matters to be discussed. If the matters to be
discussed require opinions from independent Directors, sponsor institutions, or independent
financial advisors, along with other securities service institutions, the relevant opinions and
reasons will also be disclosed when the notice of the Shareholders’ meeting. or supplementary
notice is issued.
Convening of Shareholders’ Meetings
If a private shareholder attends the meeting in person, he/she shall present his/her identity
card or other valid certificates or proof that can show his/her identity; if he/she attends the meeting
on behalf of another person, he/she shall present his/her valid identity certificate and the letter of
authorization from the shareholder.
Legal shareholders should be represented by their legal representative or an agent authorized
by the legal representative to attend the meeting. If the legal representative attends, they must
present their ID card and valid proof of their authority as a legal representative (excluding
shareholders who are recognized clearing houses defined by the relevant regulations of the law of
Hong Kong as from time to time in force or the securities regulatory rules in the place where the
Company’s shares are listed). If an agent attends, they must present their ID card and a written
authorization letter issued by the legal representative of the legal shareholders entity (excluding
shareholders who are recognized clearing houses defined by the relevant regulations of the law of
Hong Kong as from time to time in force or the securities regulatory rules in the place where the
Company’s shares are listed).
If the shareholder is a recognized clearing house (or its agent), the recognized clearing house
may authorize company representative or one or more persons it deems appropriate to represent it
at any Shareholders’ meeting or creditors’ meeting; however, if more than one person is
authorized, the authorization must specify the number and type of shares each such person is
authorized to represent. The authorized persons may attend meetings on behalf of the recognized
clearing house (or its agent) (without presenting share certificates, with a notarized authorization
and/or further evidence confirming their formal authorization), exercising rights as if they were
individual shareholders of the Company (and enjoying the same statutory rights as other
shareholders, including the right to speak and vote).
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Each shareholder has the right to appoint one representative, who does not have to be a
shareholder of the Company; if the shareholder is a legal shareholder, it may appoint one
representative to attend and vote at any Shareholders’ meeting of the Company. If such a legal
shareholder has already appointed a representative to attend any meeting, it shall be deemed to
have attended in person. The Company may authorize its duly authorized personnel to sign the
form for appointing representatives.
The Shareholders’ meeting shall be presided over by the chairman of the Board. If the
chairman is unable or fails to perform his duties, a Director jointly nominated by more than half of
the Directors shall preside over the meeting.
The Shareholders’ meeting convened by the audit committee shall be presided over by the
convenor of the audit committee. If the convenor of the audit committee is unable or fails to
perform his duties, a member of the audit committee jointly elected by more than half of the
members of the audit committee shall preside over the meeting.
Shareholders’ meeting convened by a shareholder on his own shall be presided over by the
convenor or his representative.
When a Shareholders’ meeting is held, if the chairperson of the meeting violates the rules of
procedure and makes it impossible for the Shareholders’ meeting to continue, with the consent of
more than half of the shareholders present at the meeting who have voting rights, the
Shareholders’ meeting may elect one person to act as the chairperson of the meeting and continue
the meeting.
The Company formulates the rules of procedure for the Shareholders’ meeting, detailing the
convening, holding, and voting procedures, including notification, registration, deliberation of
proposals, voting, counting votes, announcement of the results, formation of resolutions, recording
and signing of minutes, and public announcements. The rules also specify the principles for
authorizing the Board of Directors, with the authorization content being clear and specific. The
rules of procedure for the Shareholders’ meeting should be attached to the Articles of Association,
drafted by the Board of Directors, and approved by the Shareholders’ meeting.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 689 ---
Voting and Resulting at the Shareholders’ Meeting
The following matters shall be passed by the Shareholders’ meeting by ordinary resolution:
(i) Work reports of the Board of Directors;
(ii) Plans of profits distribution and recovery of losses schemes drafted by the Board of
Directors;
(iii) Appointment or dismissal of the members of the Board of Directors, their remunerations
and the payment method;
(iv) Annual report of the Company;
(v) Issue corporate bonds;
(vi) Repurchase of shares of the Company (except in cases where the registered capital is
reduced);
(vii) To examine and approve related transactions (except for providing guarantees) between
the Company and its connected persons with an amount of more than RMB30 million
and accounting for more than 5% of the absolute value of the Company’s latest audited
net assets (except for related transactions involving special resolutions);
(viii) Other matters other than those approved by special resolution stipulated in the laws,
administrative regulations, securities regulatory rules in the place where the Company’s
Shares are listed or the Articles of Association.
The following matters shall be passed by the Shareholders’ meeting by special resolution:
(i) The increase or reduction of the registered capital of the Company;
(ii) The division, spin-off, merger, dissolution and liquidation (including voluntary
liquidation) of the Company;
(iii) Any amendment to the Articles of Association;
(iv) The purchase and sale of material assets or amount of guarantee provided by the
Company to others within one year valued at more than 30% of the audited total assets
of the Company as at the most recent period;
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--- page 690 ---
(v) Share incentive plan;
(vi) Changes in rights attached to class of shares;
(vii) Adjust or change the profit distribution policy;
(viii) other matters as required by the laws, administrative regulations, the securities
regulatory rules in the place where the Company’s shares are listed or the Articles of
Association, and considered by the Shareholders’ meeting, by way of an ordinary
resolution, to be of a nature which may have a material impact on the Company, shall be
passed by a special resolution.
If the Company’s share capital includes different classes of shares, unless otherwise specified,
any change in the rights attached to any class of shares must be approved by a special resolution
of the shareholders who hold shares of the class to which such rights are attached and attend the
Shareholders’ meeting of that class. For the purposes of this article, the Company’s A-shares and
H-shares are considered to be of the same class.
Shareholders (including shareholders’ agents) shall exercise their voting rights in accordance
with the number of voting shares they represent. Each share shall enjoy one vote, except for
holders of a class of shares (if any).
When the Shareholders’ meeting deliberates on major matters affecting the interests of small
and medium-sized investors, separate votes shall be counted for small and medium-sized investors.
The results of separate votes shall be disclosed in a timely manner.
The Company’s shares held by the Company have no voting rights, and such shares are not
included in the total number of voting shares attending the Shareholders’ meeting.
In accordance with applicable laws and regulations and the Hong Kong Listing Rules of the
Stock Exchange of Hong Kong, if any shareholder is required to waive his or her voting rights on
a resolution or to restrict any shareholder from voting only in favor (or against) a resolution, the
number of votes cast by such shareholder or his or her representative in violation of the relevant
provisions or restrictions shall not be counted as part of the total number of voting shares.
If a shareholder purchases voting shares of the Company in violation of Article 63,
Paragraphs 1 and 2 of the Securities Law, the portion exceeding the specified ratio shall not
exercise voting rights for 36 months after the purchase and shall not be counted towards the total
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 691 ---
number of voting shares present at the Shareholders’ meeting. If there are other provisions in the
securities regulatory rules in the place where the Company’s shares are listed, those provisions
shall apply.
The Board of Directors, independent Directors, and shareholders holding more than 1% of the
voting shares, or investor protection institutions established in accordance with laws,
administrative regulations, or the provisions of the China Securities Regulatory Commission, may
solicit shareholder voting rights. When soliciting shareholder voting rights, they must fully
disclose specific voting intentions and other information to the solicited parties. It is prohibited to
solicit shareholder voting rights through paid or disguisedly paid means. Except for statutory
conditions, the Company shall not impose a minimum shareholding ratio limit on the solicitation
of voting rights. If there are other provisions in the securities regulatory rules in the place where
the Company’s shares are listed, those provisions shall apply.
When the Shareholders’ meeting deliberates on related party transactions, the associated
shareholders shall not participate in voting, and the number of voting shares represented by them
shall not be included in the total number of valid votes; the resolution of the Shareholders’
meeting shall state the voting situation of non-associated shareholders.
Resolutions on related-party transactions made by the Shareholders’ meeting must be passed
by more than half of the voting rights held by non-affiliated shareholders present at the meeting to
be valid; for matters involving related-party transactions that require special resolution as
stipulated in the Articles of Association, they must be passed by more than two-thirds of the voting
rights held by non-affiliated shareholders present at the meeting to be valid.
DIRECTORS AND BOARD OF DIRECTORS
General Provisions for Directors
Directors may include Executive Directors, Non-executive Directors, and Independent
Directors (i.e. Independent Non-executive Directors). The non-executive director means the
Director who does not hold a management position in the Company. Independent Directors are
persons who meet the requirements of the Articles of Association. Directors of the Company shall
be natural persons, and a person may not serve as a Director of the Company in case of any of the
following circumstances:
(i) the person without capacity for civil acts or with limited civil conduct capacity;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 692 ---
(ii) the person who has been sentenced to criminal punishment for embezzlement, bribery,
misappropriation of property or disruption of the socialist market economic order, or has
been deprived of political rights for committing a crime and has not completed the term
of execution within 5 years, or has been granted probation, 2 years have not elapsed
since the expiration of the probation period;
(iii) a director or factory director or manager of a Company or enterprise undergoing
bankruptcy liquidation who is personally liable for the bankruptcy of such Company or
enterprise shall not exceed 3 years from the date of completion of the liquidation of
such Company or enterprise;
(iv) the person who is a legal representative of a Company or enterprise which had its
business license revoked and was ordered to shut down due to a violation of the law and
who incurred personal liability, where less than 3 years have elapsed since the date of
such revocation of the business license and order to shut down;
(v) the person listed as a judgment defaulter by the court of the PRC because the amount of
debt he bears is relatively large and the debt is not paid off when it is due;
(vi) the person has been banned by the CSRC from access to the securities market, and the
term of prohibition has not expired;
(vii) having been publicly identified by the stock exchange as unfit to serve as a director or
senior manager of a listed Company, and the term has not expired;
(viii)other contents stipulated by laws, administrative regulations or departmental rules or the
securities regulatory rules in the place where the shares of the Company are listed.
Where a Director is elected or appointed in violation of the provisions above, the election,
appointment or hiring shall be invalid. If a Director falls under the provisions above during his or
her tenure, the Company shall remove him or her from office and stop performing his or her
duties.
During the above period, the date of convening the Shareholders’ meeting or the Board of
Directors for the proposed appointment of Directors or senior managers shall be counted from the
convening date up to the deadline.
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--- page 693 ---
If a director candidate falls under any of the following circumstances, he/she shall explain the
specific circumstances of such matters, the reasons for selection and whether it affects the
standardized operation of the Company. The Company shall disclose the above information and
warn the risks. The details are as follows:
(i) Recently subjected to administrative punishment by China Securities Regulatory
Commission within 3 years;
(ii) In the recent 3 years, he has been publicly condemned by the stock exchange or
criticized more than 3 times;
(iii) He has been investigated by judicial organs for suspected crimes or investigated by
China Securities Regulatory Commission for suspected violations of laws and
regulations, but no clear conclusion has been reached;
(iv) Be listed on the public inquiry platform for illegal and untrustworthy information in the
securities and futures market by China Securities Regulatory Commission or be included
in the list of untrustworthy persons subjected to execution by the People’s Court.
The Director shall abide by the laws, administrative regulations, securities regulatory rules in
the place where the Company’s shares are listed and the provisions of the Articles of Association,
shall have due diligence obligations to the Company, and shall exercise due care in performing his
duties for the maximum benefit of the Company as a manager should normally do.
The Directors shall have the following duties of diligence to the Company:
(i) Ensure sufficient time and energy to participate in Company affairs;
(ii) The rights granted by the Company shall be exercised prudently, seriously and diligently
to ensure that the Company’s business activities comply with the requirements of
national laws, administrative regulations and various national economic policies, and
that the business activities do not exceed the scope of business specified in the business
license;
(iii) All shareholders shall be treated fairly. Upon learning that the Company’s shareholders,
actual controllers and their connected persons have infringed on the Company’s assets or
abused their control rights or otherwise harmed the interests of the Company or other
shareholders, they shall timely report to the Board of Directors and urge the Company to
fulfill its obligation of information disclosure;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 694 ---
(iv) Keep abreast of the Company’s business management status, continue to pay attention to
events that may have a significant impact on the Company’s production and operation,
and timely report the problems existing in the Company’s business activities to the
Board of Directors; shall not shirk responsibility on the grounds of not directly engaging
in business management or not knowing;
(v) Shall personally attend the Board meeting and prudently judge the risks and benefits
that may arise from the matters under consideration; if he is unable to attend the Board
meeting for any reason, he shall prudently select the trustee;
(vi) The Company shall sign written confirmation opinions on the regular reports of the
Company to ensure that the information disclosed by the Company is true, accurate and
complete. Actively promote the standardized operation of the Company, urge the
Company to perform the information disclosure obligations fairly and timely, and
promptly correct and report the illegal acts of the Company;
(vii) They shall truthfully provide the audit committee with relevant information and
materials and shall not interfere the audit committee with the performance of its
functions and powers;
(viii) Other duties of diligence as stipulated in laws, administrative regulations, departmental
rules, securities regulatory rules in the place where the Company’s shares are listed and
the Articles of Association.
The senior management personnel of the Company shall perform their duties in accordance
with the above requirements.
When the Board deliberates on guarantee matters, Directors should actively understand the
basic situation of the guaranteed party, such as its business and financial status, credit standing,
and tax payment records. Directors should make prudent judgments regarding the compliance and
reasonableness of the guarantee, the guarantor’s ability to repay debts, and whether
counter-guarantee measures are effective and if the guarantee risks are controllable.
When the Board of Directors deliberates on the guarantee proposal of the holding Company
and the participating Company of the listed Company, it shall focus on whether the other
shareholders of the holding Company and the participating Company provide the same proportion
of guarantee or counter-guarantee and other risk control measures according to the equity ratio,
whether the guarantee risk is controllable and whether it would damages the interests of the listed
Company.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 695 ---
The Company has established a Director resignation management system, clearly defining the
accountability and compensation measures for unfulfilled public commitments and other
unresolved matters. When a Director’s resignation takes effect or their term expires, they must
complete all transfer procedures with the Board of Directors. Their fiduciary duties to the
Company and shareholders do not automatically terminate upon the expiration of their term; they
remain valid for 2 years after the resignation takes effect or the end of their term. Their obligation
to keep the Company’s trade secrets confidential remains in force until such secrets become public
information. The duration of any other obligations owed by the Director shall be determined
according to the principle of fairness, taking into account the length of time between the
occurrence of an event and the departure from office, as well as the circumstances and conditions
under which the relationship with the Company ends. The responsibilities that a director bears
during their term, arising from the execution of their duties, shall not be waived or terminated
upon their departure.
Independent Directors
The Company shall have independent Directors. Independent Directors shall diligently
perform their duties in accordance with laws, administrative regulations, the CSRC, the securities
regulatory authority in the place where the Company’s shares are listed, and the provisions of the
Articles of Association. They shall play a role in decision-making, supervision and balances, and
professional consultation within the Board of Directors, safeguarding the overall interests of the
Company and protecting the lawful rights and interests of minority shareholders.
An independent director refers to a director who does not hold any other position in the
Company except for a director, and has no direct or indirect interest relationship with the
Company and its major shareholders or actual controllers, or any other relationship that may
hinder his independent and objective judgment.
The term “major shareholder” as mentioned in the preceding paragraph refers to a
shareholder who holds more than 5% of the Company’s shares, or a shareholder who holds less
than 5% of the Company’s shares but has a significant impact on the Company.
Independent Directors must maintain independence. The following persons shall not serve as
independent Directors:
(i) The personnel who work in the Company or its affiliated companies and their spouses,
parents, children and major social relations (major social relations refer to siblings,
parents of the spouse, spouses of children, spouses of siblings, siblings of the spouse,
parents of children’s spouses, etc.);
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 696 ---
(ii) Directly or indirectly holding more than 1% of the Company’s shares or natural person
shareholders among the top ten shareholders of the Company and their spouses, parents
and children;
(iii) Shareholders who directly or indirectly hold more than 5% of the Company’s shares, or
personnel who serve in the top five shareholders units of the Company and their
spouses, parents and children;
(iv) Persons who hold positions in the affiliated enterprises of the controlling shareholders
and actual controllers of the Company, as well as their spouses, parents and children
(the affiliated enterprises of the controlling shareholders and actual controllers do not
include the affiliated enterprises that do not constitute an affiliate relationship with the
Company according to the regulatory rules of the stock listing place);
(v) Persons who provide financial, legal, consulting, sponsorship and other services to the
Company and its controlling shareholders, actual controllers or their respective affiliated
enterprises, including but not limited to all members of the project team of the
intermediary providing services, reviewers at all levels, persons who sign the report,
partners, Directors, senior managers and principal persons in charge;
(vi) Persons who have major business contacts with the Company and its controlling
shareholders, actual controllers or their respective affiliated enterprises, or persons who
have served in the units with major business contacts and their controlling shareholders
and actual controllers;
(vii) Persons who have had one of the six conditions listed in the last 12 months;
(viii) Other persons who do not have independence as stipulated in laws, administrative
regulations, regulatory rules of the place where the Company’s shares are listed and the
Articles of Association.
The independent Director shall conduct self-examination of his independence every year and
submit the self-examination to the Board of Directors. The Board of Directors shall evaluate the
independence of the independent Director in office every year and issue special opinions, which
shall be disclosed at the same time as the annual report.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 697 ---
In addition to the powers of Directors stipulated in the Articles of Association, independent
Directors shall also have the following special powers:
(i) To independently engage an intermediary to audit, consult or verify specific matters of
the Company;
(ii) Propose to the Board of Directors to convene an extraordinary general meeting;
(iii) Propose to convene a board meeting;
(iv) To solicit shareholders’ rights in accordance with the law publicly;
(v) To express independent opinions on matters that may harm the interests of the Company
or minority shareholders;
(vi) Other powers as stipulated by laws, administrative regulations, regulatory rules of the
place where the Company’s shares are listed and the Articles of Association.
Where an independent Director exercises the functions and powers listed in subparagraphs (i)
to (iii) of the preceding paragraph, he/she shall obtain the consent of more than half of all the
independent Directors.
Where an independent director exercises the functions and powers listed in the first
paragraph, the Company shall make a timely disclosure. If the functions and powers cannot be
exercised normally, the Company shall disclose the specific situation and reasons.
Board of Directors
The Company has a Board of Directors.
The Board of Directors is composed of 9 Directors, including 1 executive Director , 4
non-executive Directors and 4 independent Directors. The non-executive Directors include 1
employee representative Director, who is elected by the Company’s employees through democratic
election.
The Company shall have one chairman, who shall be elected by the majority of all Directors
of the Board of Directors.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
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--- page 698 ---
The Board of Directors shall exercise the following functions and powers:
(i) To convene a Shareholders’ meeting and report to the Shareholders’ meeting;
(ii) To implement the resolutions of the Shareholders’ meeting;
(iii) Decide on the Company’s business plan and investment program;
(iv) To formulate the Company’s profit distribution plan and loss compensation plan;
(v) To formulate plans for increasing or reducing the registered capital of the Company,
issuing bonds or other securities and listing;
(vi) To formulate plans for major acquisitions of the Company, acquisition of the Company’s
shares, merger, division, dissolution and change of the Company’s form;
(vii) Within the scope of authorization by the Shareholders’ meeting, it shall decide on
matters such as the Company’s external investment, acquisition and sale of assets, asset
mortgage, external guarantee, entrusted financial management, related party transactions
and external donation;
(viii) Decide the establishment of internal management institutions;
(ix) To appoint or dismiss the general manager, secretary of the Board of Directors and other
senior managers of the Company, and decide on their remuneration and rewards and
punishments; to decide on the appointment or dismissal of deputy general managers,
chief financial officers and other senior managers upon the nomination of the general
manager, and decide on their remuneration and rewards and punishments;
(x) To propose the remuneration, allowance standards and rewards of the Company’s
Directors;
(xi) Formulate the basic management system of the Company;
(xii) To formulate the amendment plan of these Articles;
(xiii) To manage the disclosure of Company information;
(xiv) To request the Shareholders’ meeting to hire or replace the accounting firm auditing the
Company;
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--- page 699 ---
(xv) Listen to the general manager’s work report and check the general manager’s work;
(xvi) Other powers conferred by laws, administrative regulations, departmental rules,
regulatory rules of the place where the Company’s shares are listed or by the Articles of
Association.
Matters beyond the scope of authorization by the Shareholders’ meeting shall be submitted to
the Shareholders’ meeting for deliberation.
The chairman shall exercise the following powers:
(i) To preside over the Shareholders’ meeting and convene and preside over the Board of
Directors meeting;
(ii) To supervise and inspect the implementation of Board resolutions;
(iii) Sign important documents of the Board of Directors or other documents that should be
signed by the legal representative of the Company;
(iv) In case of force majeure such as natural disasters, exercise special disposal rights in
accordance with legal provisions and the interests of the Company, and report to the
Board of Directors and Shareholders’ meeting after the event;
(v) Other powers stipulated by laws, administrative regulations, regulatory rules of the place
where the Company’s shares are listed and the Articles of Association, as well as other
power granted by the Board of Directors.
When the chairman exercises his power within the scope of his authority (including
authorization), he shall make prudent decisions when encountering matters that may have a
significant impact on the Company’s operation, and submit them to the Board of Directors for
collective decision-making if necessary.
The Board of Directors convenes at least four meetings per year, approximately once per
quarter, convened and chaired by the chairman. At least 14 days before each regular Board
meeting, written notice should be sent to all Directors, informing them of the time, location, and
agenda of the meeting. With the unanimous consent of all Directors, the notification period for
convening regular Board meetings may be shortened or waived.
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--- page 700 ---
Shareholders representing more than 1/10 of the voting rights, Directors or the audit
committee representing more than 1/3 may propose to convene an extraordinary meeting of the
Board of Directors. The chairman shall, within 10 days after receiving the proposal, convene and
preside over the meeting of the Board of Directors.
The Board of Directors shall notify all the Directors in writing 5 days prior to the convening
of an extraordinary meeting of the Board of Directors. With the unanimous consent of all the
Directors, the time limit for notifying the convening of an extraordinary meeting of the Board of
Directors may be shortened or waived.
Special Committees Under the Board of Directors
The Company’s Board of Directors establishes specialized committees for auditing, strategy,
nomination, compensation and evaluation. These specialized committees perform their duties in
accordance with the Articles of Association and the authorization from the Board of Directors.
Proposals from these specialized committees should be submitted to the Board of Directors for
deliberation and decision. The Board of Directors is responsible for formulating the working
procedures of the specialized committees to standardize their operations.
All members of the special committee shall be composed of Directors, among which the audit
committee, nomination committee and compensation and appraisal committee shall be composed of
independent Directors in the majority and serve as convenors, and the convenor of the audit
committee shall be an accounting professional.
General Manager and Other Senior Management Personnel
The Company shall have one general manager, who shall be appointed or dismissed by the
Board of Directors.
The Company shall have several deputy general managers, who shall be appointed or
dismissed by the Board of Directors.
The general manager, deputy general manager, secretary of the Board of Directors and chief
financial officer shall be senior management personnel of the Company.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 2 8–


--- page 701 ---
The general manager shall be responsible to the Board of Directors and exercise the
following powers:
(i) To preside over the production and operation management of the Company, organize the
implementation of the resolutions of the Board of Directors, and report to the Board of
Directors;
(ii) To organize and implement the Company’s annual business plan and investment plan;
(iii) To formulate the plan of internal management organization;
(iv) To formulate the basic management system of the Company;
(v) To formulate specific rules and regulations of the Company;
(vi) To propose to the Board of Directors the appointment or dismissal of the deputy general
manager and the chief financial officer;
(vii) Decide on the appointment or dismissal of managers other than those who should be
appointed or dismissed by the Board of Directors;
(viii)Other powers conferred by the Articles of Association or the Board of Directors.
The general manager attends the Board meeting.
The Company shall have a secretary of the Board of Directors, who shall be responsible for
the preparation and archiving of meetings of the Shareholders’ meeting and the Board of Directors,
as well as the management of shareholder information of the Company and the handling of
information disclosure matters. The secretary of the Board of Directors shall abide by laws,
administrative regulations, departmental rules, securities regulatory rules in the place where the
Company’s shares are listed, and relevant provisions of the Articles of Association.
FINANCIAL ACCOUNTING SYSTEM, DISTRIBUTION OF PROFITS AND AUDIT
Financial Accounting System
The Company shall formulate its financial accounting system in accordance with laws,
administrative regulations and provisions of relevant state departments.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 2 9–


--- page 702 ---
The Company shall submit and disclose its annual report to the local CSRC branch and the
stock exchange within 4 months after the end of each fiscal year. It shall submit and disclose its
semi-annual report to the local CSRC branch and the stock exchange within 2 months after the end
of the first 6 months of each fiscal year. It shall submit quarterly financial reports to the local
CSRC branch and the stock exchange within 1 month after the end of the first 3 months and the
first 9 months of each fiscal year.
The annual and semi-annual reports mentioned above shall be prepared in accordance with
relevant laws, administrative regulations and the provisions of the securities regulatory authority in
the place where the Company’s shares are listed.
A Company may not establish accounting books other than those prescribed by law. The
funds of a Company shall not be opened and deposited in any account under the name of any
individual.
When distributing the after-tax profits of the current year, the Company shall set aside 10%
of the profits into the statutory reserve fund of the Company. If the accumulated amount of the
statutory reserve fund of the Company is more than 50% of the registered capital of the Company,
no further extraction shall be made.
Where the statutory reserve fund of a Company is insufficient to cover the losses of previous
years, it shall first use the profits of the current year to cover the losses before drawing the
statutory reserve fund in accordance with the provisions of the preceding paragraph.
After the Company draws out the statutory reserve fund from its post-tax profits, it may also
draw out the discretionary reserve fund from its post-tax profits upon resolution by the
Shareholders’ meeting.
The remaining after-tax profits of the Company after making up for losses and drawing out
the reserve fund shall be distributed in proportion to the shares held by shareholders, except as
otherwise provided in the Articles of Association.
If the Shareholders’ meeting will distribute profits to the shareholders in violation of the
Company Law, the shareholders shall return the profits allocated in violation of the provisions to
the company; If losses are caused to the company, shareholders and responsible Directors and
senior management shall be liable for compensation.
The Company’s shares held by the Company do not participate in the distribution of profits.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 3 0–


--- page 703 ---
The Company must appoint one or more collection agents for H-share shareholders in Hong
Kong. The collection agent shall collect and hold on behalf of the relevant H-share shareholders
the dividends allocated by and other payments due from the Company in respect of the H-shares,
pending payment to such H-share shareholders. The collection agent appointed by the Company
shall comply with the requirements of laws and regulations as well as the securities regulatory
rules in the place where the Company’s shares are listed.
The Company’s reserve fund shall be used to make up for the Company’s losses, expand the
Company’s production and operation or be converted into an increase in the Company’s capital.
To make up for the Company’s losses, the Company shall first use the discretionary reserve
fund and the statutory reserve fund; if it still cannot make up for the losses, it may use the capital
reserve fund in accordance with the provisions.
When the statutory reserve fund is converted into an increase in registered capital, the
retained reserve fund shall not be less than 25% of the Company’s registered capital before the
conversion.
Internal Audit
The Company implements the internal audit system, clarifying the leadership system of
internal audit work, responsibilities and authority, personnel allocation, financial guarantee,
application of audit results and accountability.
The internal audit system of the Company shall be implemented and disclosed to the public
after being approved by the Board of Directors.
The internal audit function is accountable to the Board of Directors. The internal audit
function shall be subject to the oversight and guidance of the Audit Committee during the process
of supervising and inspecting the Company’s business activities, risk management, internal control,
and supervision and inspection of financial information. If the internal audit function identifies any
significant issues or leads, it should immediately report directly to the Audit Committee.
Appointment of an Accounting Firm
The Company employs an accounting firm that complies with the provisions of the Securities
Law to conduct financial and accounting report audit, net asset verification and other related
consulting services. The term of employment is one year and can be renewed.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 3 1–


--- page 704 ---
The Company’s employment, dismissal or non-renewal of an accounting firm must be decided
by the Shareholders’ meeting. The Board of Directors shall not appoint an accounting firm before
the decision of the Shareholders’ meeting.
The Company shall guarantee to the employed accounting firm to provide true and complete
accounting vouchers, accounting books, financial accounting reports and other accounting
materials, and shall not refuse, conceal or misrepresent them.
The remuneration of the accounting firm or the method of determining the remuneration shall
be decided by the Shareholders’ meeting.
When the Company dismisses or does not renew the engagement of an accounting firm, it
shall notify the accounting firm 30 days in advance. When the Shareholders’ meeting of the
Company votes on the dismissal of the accounting firm, the accounting firm is allowed to state its
opinions.
Where an accounting firm proposes resignation, it shall explain to the Shareholders’ meeting
whether there is any improper situation in the Company.
MERGER, DIVISION, CAPITAL INCREASE, CAPITAL REDUCTION, DISSOLUTION
AND LIQUIDATION
Merger, Division, Capital Increase, and Capital Reduction
A merger may be an absorption merger or a new merger.
Where one Company absorbs another Company in a merger of absorption, the absorbed
Company is dissolved; where two or more companies merge to establish a new Company, the
parties to the merger are dissolved.
Where the price paid by the Company in a merger does not exceed 10% of the net assets of
the Company, it may be without resolution of the Shareholders’ meeting, except as otherwise
provided for in the Articles of Association.
Where the Company fails to reach a decision by the Shareholders’ meeting in accordance
with the provisions of the preceding paragraph, it shall make a decision by the Board of Directors.
When a Company is merged, the claims and debts of the parties to the merger shall be
succeeded by the surviving Company or the newly established Company.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 3 2–


--- page 705 ---
In the case of a division of the Company, its property shall be divided accordingly.
In the event of a Company division, a balance sheet and a list of assets shall be prepared. The
Company shall notify its creditors within 10 days from the date of making the resolution on
division and make an announcement in the National Enterprise Credit Information Publicity
System (ʮͪӻ୕ ) within 30 days.
The debts of the Company before the division shall bear joint and several liability by the
Company after the division. However, this shall not apply if the Company has reached a written
agreement with the creditor on the repayment of debts before the division.
The Company will prepare a balance sheet and a list of assets when it reduces its registered
capital.
The Company shall notify its creditors within 10 days from the date of the resolution to
reduce registered capital at the Shareholders’ meeting, and announce it on the National Enterprise
Credit Information Publicity System (ʮͪӻ୕ ) within 30 days. Creditors who
receive the notice have 30 days from the date of receipt, or those who do not receive the notice
have 45 days from the date of the announcement, to request the Company to settle debts or provide
corresponding guarantees.
Where a Company reduces its registered capital, it shall reduce the amount of contribution or
shares in proportion to the shares held by shareholders, except as otherwise provided for by law or
these Articles of Association.
After making up the losses in accordance with paragraph 2 of Article 163 of the Articles of
Association, if the Company still has losses, it may reduce its registered capital to make up the
losses. If the registered capital is reduced to make up the losses, the Company shall not distribute
profits to shareholders and shall not exempt shareholders from their obligations to pay their capital
contributions or share payments.
Where the registered capital is reduced in accordance with the provisions of the preceding
paragraph, the provisions of Paragraph 2 of Article 190 of the Articles of Association shall not
apply, but the shareholders’ resolution on the reduction of registered capital shall be announced in
the National Enterprise Credit Information Publicity System (ʮͪӻ୕ ) within
30 days from the date of the resolution.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 3 3–


--- page 706 ---
After the Company reduces its registered capital in accordance with the provisions of the
preceding two paragraphs, it shall not distribute profits before the accumulated amount of the
statutory minimum reserve fund and the discretionary reserve fund reaches 50% of the registered
capital of the Company.
Where the registered capital is reduced in violation of the Company Law and other relevant
provisions, the shareholders shall refund the funds received, and the reduction of the shareholders’
capital contribution shall be restored to its original state; if losses are caused to the Company, the
shareholders and the Directors and senior managers responsible shall bear the liability for
compensation.
When the Company issues new shares to increase its registered capital, shareholders shall not
have the right of first refusal to subscribe for the shares, except as otherwise provided in the
Articles of Association or decided by the Shareholders’ meeting that shareholders shall have the
right of first refusal to subscribe for the shares.
Dissolution and Liquidation
The Company is dissolved for the following reasons:
(i) The grounds for dissolution provided for in these Articles of Association appear;
(ii) The Shareholders’ meeting resolves to dissolve;
(iii) The Company needs to be dissolved due to merger or division;
(iv) Having their business licenses revoked, ordered to close down or revoked according to
law;
(v) Where the Company’s operation and management have serious difficulties, and its
continued existence will cause major losses to the interests of shareholders, and cannot
be solved through other means, the shareholders holding more than 10% of the voting
rights of the Company may request the People’s Court to dissolve the Company.
Where an enterprise has a cause for dissolution as provided in the preceding paragraph, it
shall publicize the cause for dissolution through the National Enterprise Credit Information
Publicity System (ʮͪӻ୕ ) within 10 days.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 3 4–


--- page 707 ---
Where a Company is dissolved in accordance with items (1), (2), (4) and (5) of Article 195 of
the Articles of Association, liquidation shall be conducted. The Directors shall be the liquidators of
the Company and shall form a liquidation group to conduct liquidation within 15 days from the
date when the cause of dissolution occurs.
The liquidation group shall be composed of Directors, except as otherwise provided in the
Articles of Association or as otherwise selected by the Shareholders’ meeting.
If the liquidation obligor fails to perform the liquidation obligation in a timely manner and
causes loss to the company or creditor, it shall be liable for compensation.
The liquidation group shall notify the creditors within 10 days from the date of its
establishment and make an announcement in the National Enterprise Credit Information Publicity
System (ʮͪӻ୕ ) within 60 days. The creditors shall declare their claims to
the liquidation group within 30 days from the date of receiving the notice and within 45 days from
the date of the announcement if they have not received the notice.
When a creditor declares his or her claim, he or she shall state the relevant matters of the
claim and provide supporting materials. The liquidation group shall register the claim.
During the claims declaration period, the liquidation group shall not pay off the creditors.
After liquidating the Company’s property, preparing a balance sheet and a list of assets and
liabilities, the liquidation group shall work out a liquidation plan and submit it to the
Shareholders’ meeting or the People’s Court for confirmation.
After the Company’s assets have been paid for liquidation expenses, employees’ wages, social
insurance expenses and statutory compensation respectively, the overdue taxes have been paid and
the Company’s debts have been paid, the remaining assets shall be distributed according to the
proportion of shares held by shareholders.
During the liquidation period, the Company shall continue to exist, but shall not carry out
any business activities unrelated to the liquidation. The Company’s property shall not be
distributed to shareholders before it is paid off in accordance with the provisions of the preceding
paragraph.
If, after liquidation of the Company’s property and preparation of balance sheets and lists of
assets and liabilities, the liquidation group finds that the Company’s property is insufficient to pay
off its debts, it shall apply to the People’s Court for bankruptcy liquidation according to law.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 3 5–


--- page 708 ---
After the bankruptcy application is accepted by the People’s Court in accordance with the
ruling, the liquidation group shall transfer the liquidation affairs to the bankruptcy administrator
designated by the People’s Court.
Where a Company is declared bankrupt according to law, bankruptcy liquidation shall be
carried out in accordance with the relevant laws on enterprise bankruptcy.
Amendments to the Articles of Association
Under any of the following circumstances, the Company shall amend its Articles of
Association:
(i) After the amendment of the Company Law or relevant laws, administrative regulations
or securities regulatory rules in the place where the Company’s shares are listed, the
provisions of the Articles of Association conflict with the provisions of the amended
laws, administrative regulations or securities regulatory rules in the place where the
Company’s shares are listed;
(ii) The Company’s situation has changed and is inconsistent with the matters recorded in
the Articles of Association;
(iii) The Shareholders’ meeting decides to amend the Articles of Association.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 3 6–


--- page 709 ---
1. FURTHER INFORMATION ABOUT OUR GROUP
A. Incorporation
Our Company, then known as Shenzhen Han’s CNC Technology Limited (߅
ʮ̡ ), was established as a limited liability company under the laws of the PRC on April
22, 2002, and was converted into a joint stock company with limited liability in November 2020,
when we also changed our name to Shenzhen Han’s CNC Technology Co., Ltd.. We completed the
listing of our A Shares on the ChiNext Market of the Shenzhen Stock Exchange (stock code:
301200) in February 2022. For further details of the listing of our A Shares, see “History and
Corporate Structure — Our Listing on the Shenzhen Stock Exchange and Reasons for the Listing
on the Stock Exchange” in this Prospectus.
Our registered office is located at No. 101 of Building 3, 1-2/F, 4/F and 7/F of Building 3,
and 1/F and 4/F of Building 4, Han’s Laser Intelligence Manufacturing Center, 12 Chongqing
Road, Heping Community, Fuhai Street, Bao’an District, Shenzhen, Guangdong Province, PRC.
We have applied for registration as a non-Hong Kong company in Hong Kong under Part 16 of the
Companies Ordinance on May 27, 2025, and our principal place of business in Hong Kong is at
Room 1916, 19/F, Lee Garden One, 33 Hysan Avenue, Causeway Bay, Hong Kong. Ms. WONG
Nga Sim has been appointed as the authorised representative of our Company for the acceptance of
service of process and notices on behalf of our Company in Hong Kong. The address for service of
process on our Company in Hong Kong is the same as our principal place of business in Hong
Kong as set out above.
As the Company was established in the PRC, its operations are subject to the relevant laws
and regulations of the PRC. A summary of the relevant aspects of laws and regulations of the PRC
and the Articles of Association is set out in Appendices IV and V to this Prospectus, respectively.
B. Changes in Share Capital of our Company
On May 21, 2025, the share capital of our Company increased from RMB420,000,000 to
RMB425,509,152 as a result of the issuance of 5,509,152 A Shares upon the vesting of the Share
Awards granted under the 2023 Restricted Share Incentive Scheme.
Save as disclosed above, there has been no alteration in the share capital of the Company
within two years immediately preceding the date of this Prospectus.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-1 –


--- page 710 ---
C. Further Information about Our Subsidiaries
Details of our subsidiaries are set out in Note 1 to the Accountants’ Report in Appendix I to
this Prospectus.
On October 18, 2023, the registered share capital of Xinfeng CNC was increased from
RMB10 million to RMB140 million.
On June 12, 2024, HAN’S CNC TECHNOLOGY (THAILAND) CO., LTD. was established in
Thailand with its registered capital of Thai Baht 15 million.
On November 6, 2024, HANS CNC SINGAPORE PTE LTD. was established in Singapore
with its registered capital of Singapore Dollar 0.1 million.
On January 23, 2025, the registered share capital of Han’s Microelectronics was increased
from RMB10 million to RMB50 million.
On December 16, 2025, HANS CNC TECHNOLOGY COMPANY LIMITED (VIETNAM)
was established in Vietnam with a registered capital of VND 13,120 million.
Save as disclosed above, no alteration in the registered capital of our subsidiaries has taken
place within the two years preceding the date of this Prospectus.
D. Resolutions Passed by Our Shareholders’ General Meeting of Our Company in Relation
to the Global Offering
Pursuant to the shareholders’ general meeting held on May 12, 2025, the following
resolutions, among others, were duly passed:
(a) the issue by our Company of H Shares of nominal value of RMB1.00 each and such H
Shares be listed on the Stock Exchange;
(b) the number of H Shares to be issued before the exercise of the Over-allotment Option
shall not exceed 10% of the enlarged share capital of our Company upon completion of
the Global Offering and granting the Underwriters the Over-allotment Option of no
more than 15% of the above number of H Shares to be issued;
(c) subject to the completion of the Global Offering, the conditional adoption of the Articles
of Association, which shall become effective on Listing Date; and
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-2 –


--- page 711 ---
(d) authorization of the Board and its authorized person to handle relevant matters relating
to, among other things, the Global Offering, the issue and listing of the H Shares.
2. FURTHER INFORMATION ABOUT OUR BUSINESS
A. Summary of Material Contracts
The following are contracts (not being contracts entered into in the ordinary course of
business) entered into by any member of our Group within the two years preceding the date of this
Prospectus that are or may be material:
(a) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, Hongxing International Technology Limited (ʮ̡ ) and
China International Capital Corporation Hong Kong Securities Limited, with respect to a
subscription of Shares at the Offer Price in the aggregate amount of US$60,000,000;
(b) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, GIC Private Limited and China International Capital Corporation Hong Kong
Securities Limited, with respect to a subscription of Shares at the Offer Price in the
aggregate amount of US$90,000,000;
(c) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, Schroder Investment Management (Singapore) Ltd, Schroder Investment
Management (Hong Kong) Limited and China International Capital Corporation Hong
Kong Securities Limited, with respect to a subscription of Shares at the Offer Price in
the aggregate amount of US$75,000,000;
(d) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, HHLR Advisors, Ltd. and China International Capital Corporation Hong
Kong Securities Limited, with respect to a subscription of Shares at the Offer Price in
the aggregate amount of US$25,000,000;
(e) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, Morgan Stanley & Co. International plc and China International Capital
Corporation Hong Kong Securities Limited, with respect to a subscription of Shares at
the Offer Price in the aggregate amount of US$10,000,000;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-3 –


--- page 712 ---
(f) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, Fullgoal Asset Management (HK) Limited and China International Capital
Corporation Hong Kong Securities Limited, with respect to a subscription of Shares at
the Offer Price in the aggregate amount of US$3,000,000;
(g) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, Fullgoal Fund Management Co., Ltd. and China International Capital
Corporation Hong Kong Securities Limited, with respect to a subscription of Shares at
the Offer Price in the aggregate amount of US$7,000,000;
(h) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, CICC Financial Trading Limited and China International Capital Corporation
Hong Kong Securities Limited, with respect to a subscription of Shares at the Offer
Price in the aggregate amount of US$10,000,000;
(i) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, ICBC Wealth Management Co., Ltd. and China International Capital
Corporation Hong Kong Securities Limited, with respect to a subscription of Shares at
the Offer Price in the aggregate amount of US$10,000,000;
(j) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, Wind Sabre Fund SPC acting on behalf of and for the account of Wind Sabre
Opportunities Fund SP and China International Capital Corporation Hong Kong
Securities Limited, with respect to a subscription of Shares at the Offer Price in the
aggregate amount of US$10,000,000;
(k) a cornerstone investment agreement dated January 27, 2026 entered into among our
Company, WILL Semiconductor Limited and China International Capital Corporation
Hong Kong Securities Limited, with respect to a subscription of Shares at the Offer
Price in the aggregate amount of US$9,800,000; and
(l) the Hong Kong Underwriting Agreement.
B. Our Material Intellectual Property Rights
Save as disclosed below, as of the Latest Practicable Date, there were no other intellectual
property rights which are or may be material in relation to our business.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-4 –


--- page 713 ---
(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 Registration Number Registered Owner Class
Expiry Date
(dd/mm/yy)
1
 PRC 74778890 The Company 9 06/07/2034
2
 PRC 74778877 The Company 7 06/07/2034
3
 PRC 74625326 The Company 7 06/07/2034
4
 PRC 73838220 The Company 9 27/03/2034
5
 PRC 73832724 The Company 7 27/03/2034
6
 PRC 72354534 The Company 35 06/12/2033
7
 PRC 72335826 The Company 35 13/02/2034
8
 PRC 72205248 The Company 9 13/12/2033
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-5 –


--- page 714 ---
No. Trademark Place of registration Registration Number Registered Owner Class
Expiry Date
(dd/mm/yy)
9
 PRC 72204886 The Company 42 13/12/2033
10
 PRC 72203665 The Company 7 13/12/2033
11
 PRC 72197322 The Company 42 13/12/2033
12
 PRC 72191911 The Company 7 13/12/2033
13
 PRC 72187177 The Company 9 13/02/2034
14
 PRC 68288447 The Company 7 20/05/2033
15
 PRC 68284652 The Company 7 13/08/2033
16
 PRC 68281478 The Company 7 20/05/2033
17
 PRC 68281466 The Company 7 20/07/2033
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-6 –


--- page 715 ---
No. Trademark Place of registration Registration Number Registered Owner Class
Expiry Date
(dd/mm/yy)
18
 PRC 66929691 The Company 7 13/07/2033
19
 PRC 66919127 The Company 9 06/07/2033
20
 PRC 66147923 The Company 9 27/01/2033
21
 PRC 66130411 The Company 7 13/02/2033
22
 PRC 62793839 The Company 7 20/08/2032
23
 PRC 62788406 The Company 7 20/08/2032
24
 PRC 54272778 The Company 37 13/10/2031
25
 PRC 54265708 The Company 42 13/10/2031
26
 PRC 54263839 The Company 7 13/10/2031
27
 PRC 54259164 The Company 9 13/10/2031
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-7 –


--- page 716 ---
No. Trademark Place of registration Registration Number Registered Owner Class
Expiry Date
(dd/mm/yy)
28
 PRC 54254022 The Company 40 13/10/2031
29
 PRC 54254003 The Company 36 20/12/2031
30
 PRC 54242907 The Company 35 13/10/2031
31
 PRC 54049425 The Company 9 13/09/2031
32
 PRC 54049401 The Company 7 13/09/2031
33
 PRC 54048640 The Company 40 13/09/2031
34
 PRC 54046769 The Company 7 13/09/2031
35
 PRC 54042255 The Company 37 13/09/2031
36
 PRC 54037434 The Company 42 13/09/2031
37
 PRC 54036009 The Company 36 13/09/2031
38
 PRC 54034920 The Company 42 13/09/2031
39
 PRC 54033381 The Company 35 13/09/2031
40
 PRC 54032959 The Company 36 13/09/2031
41
 PRC 54032906 The Company 35 06/12/2031
42
 PRC 54031672 The Company 37 13/09/2031
43
 PRC 54030131 The Company 42 13/09/2031
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-8 –


--- page 717 ---
No. Trademark Place of registration Registration Number Registered Owner Class
Expiry Date
(dd/mm/yy)
44
 PRC 54030110 The Company 40 13/09/2031
45
 PRC 54030096 The Company 37 13/09/2031
46
 PRC 54027484 The Company 36 13/09/2031
47
 PRC 54027114 The Company 40 13/09/2031
48
 PRC 54027041 The Company 9 13/12/2031
49
 PRC 54025359 The Company 9 13/12/2031
50
 PRC 54025250 The Company 7 13/09/2031
51
 PRC 14449542 Mason Electronics 9 06/06/2035
52
 PRC 14449474 Mason Electronics 9 06/10/2035
53
 PRC 10675938 Mason Electronics 9 06/09/2033
54
 PRC 10057346 Mason Electronics 7 20/05/2033
55
 PRC 10057282 Mason Electronics 7 06/03/2033
56
 PRC 10057159 Mason Electronics 7 20/05/2033
57
 PRC 6896618 Mason Electronics 9 06/05/2031
58
 PRC 4522362 Mason Electronics 7 06/12/2027
59
 PRC 4522358 Mason Electronics 7 06/12/2027
60
 PRC 3184687 Mason Electronics 9 06/07/2033
61
 PRC 3177428 Mason Electronics 9 27/06/2033
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-9 –


--- page 718 ---
No. Trademark Place of registration Registration Number Registered Owner Class
Expiry Date
(dd/mm/yy)
62
 PRC 1578755 Mason Electronics 9 27/05/2031
63
 PRC 36328203 Advanced Intelligent
Machine Co., Ltd.
7 06/11/2029
64
 PRC 32467396 Advanced Intelligent
Machine Co., Ltd.
7 06/06/2029
65
 PRC 32467396 Advanced Intelligent
Machine Co., Ltd.
42 06/06/2029
66
 PRC 32467396 Advanced Intelligent
Machine Co., Ltd.
9 06/06/2029
67
 PRC 32464285 Advanced Intelligent
Machine Co., Ltd.
7 20/02/2030
68
 PRC 32464285 Advanced Intelligent
Machine Co., Ltd.
9 20/02/2030
69
 Korea 855698 Mason Electronics 9 24/05/2035
70
 United States 855698 Mason Electronics 9 24/05/2035
71
 Taiwan (China) 01046818 Mason Electronics 9 15/06/2033
72
 Taiwan China  01046819 Mason Electronics 9 15/06/2033
73
 Taiwan China  01046820 Mason Electronics 9 30/11/2033
As of the Latest Practicable Date, we have been granted by Han’s Laser the rights to use the
following registered trademarks which we consider to be or may be material to our business:
No. Trademark Registration Number Place of Registration Class
1
 1574557 PRC 9
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 0–


--- page 719 ---
No. Trademark Registration Number Place of Registration Class
2
 1514683 PRC 7
3
 4315034 PRC 7
4
 4315030 PRC 42
5
 8063822 PRC 7
6
 27206550 PRC 40
7
 27197793 PRC 35
8
 27197784 PRC 9
9
 27194443 PRC 40
10
 27187118 PRC 7
11
 27185604 PRC 42
12
 27184790 PRC 7
13
 34196265 PRC 42
14
 34282606 PRC 40
15
 34282596 PRC 35
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 1–


--- page 720 ---
No. Trademark Registration Number Place of Registration Class
16
 34281425 PRC 7
17
 34281324 PRC 9
18
 46977839 PRC 9
19
 46958877 PRC 9
20
 50729635 PRC 35
21
 50760040 PRC 9
22
 51886651 PRC 9
23
 51867185 PRC 9
24
 53222094 PRC 42
25
 53220606 PRC 37
26
 53217890 PRC 7
27
 53216717 PRC 7
28
 53215827 PRC 40
29
 53214139 PRC 40
30
 53213736 PRC 37
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 2–


--- page 721 ---
No. Trademark Registration Number Place of Registration Class
31
 53206157 PRC 9
32
 53198663 PRC 42
33
 53198552 PRC 35
34
 53198490 PRC 9
35
 53389835 PRC 40
36
 53375564 PRC 42
37
 53370767 PRC 7
38
 53365718 PRC 9
39
 53475491 PRC 37
40
 56627168 PRC 42
41
 56735001 PRC 42
42
 56767436 PRC 40
43
 57686641 PRC 40
44
 58609557 PRC 9
45
 58594218 PRC 9
46
 59216942 PRC 40
47
 59208507 PRC 42
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 3–


--- page 722 ---
No. Trademark Registration Number Place of Registration Class
48
 59854799 PRC 7
49
 59853758 PRC 9
50
 59852195 PRC 9
51
 62215776 PRC 7
52
 62454852 PRC 9
53
 63702252 PRC 7
54
 66654027 PRC 7
55
 66651462 PRC 35
56
 66646282 PRC 35
57
 66696231 PRC 42
58
 66687762 PRC 40
59
 66674087 PRC 37
60
 67072053 PRC 7
61
 1824736 Singapore 7, 9, 35, 37, 40, 42
62
 TM2024017606 Malaysia 7, 9
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 4–


--- page 723 ---
As of the Latest Practicable Date, Han’s Laser had applied for the registration of trademarks
and, upon approval of such registrations, granted us the rights to use the following trademarks,
which we consider to be or maybe material to our business:
No. Trademark Application Number Place of registration Class
Date of
Application
(dd/mm/yy)
1
 87874661 PRC 42 29/09/25
2
 87881163 PRC 40 29/09/25
3
 87882340 PRC 35 29/09/25
4
 87882376 PRC 37 29/09/25
5
 87882420 PRC 42 29/09/25
6
 87884851 PRC 35 29/09/25
7
 87889897 PRC 7 29/09/25
8
 87892904 PRC 37 29/09/25
9
 87894094 PRC 9 29/09/25
10
 87895399 PRC 7 29/09/25
11
 87896538 PRC 9 29/09/25
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 5–


--- page 724 ---
No. Trademark Application Number Place of registration Class
Date of
Application
(dd/mm/yy)
12
 87897111 PRC 40 29/09/25
13
 114076649 Taiwan China 7,9,35,37,40,42 17/10/25
14
 114076654 Taiwan China 7,9,35,37,40,42 17/10/25
15
 ਠᗴ2025-120751 Japan 7,9,35,37,40,42 21/10/25
16
 ਠᗴ2025-120752 Japan 7,9,35,37,40,42 21/10/25
17
 307067872 Hong Kong 7,9,35,37,40,42 23/10/25
18
 307067881 Hong Kong 7,9,37,40,42 23/10/25
19
 40202528318X Singapore 7,9,35,37,40,42 03/11/25
20
 40202528319Q Singapore 7,9,35,37,40,42 03/11/25
21
 TM2025038342 Malaysia 7,9,35,37,40,42 04/11/25
22
 TM2025038346 Malaysia 7,9,35,37,40,42 04/11/25
23
 40-2025-0204061 South Korea 7,9,35,37,40,42 04/11/25
24
 40-2025-0205006 South Korea 7,9,35,37,40,42 05/11/25
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 6–


--- page 725 ---
No. Trademark Application Number Place of registration Class
Date of
Application
(dd/mm/yy)
25
 250155639 Thailand 7,9,35,37,40,42 13/11/25
26
 250155640 Thailand 7,9,35,37,40,42 13/11/25
27
 4-2025-58550 Vietnam 7,9,35,37,40,42 13/11/25
(b) Patents
As of the Latest Practicable Date, we had registered the following patents which we consider
to be or may be material to our business:
No. Patent Patent Type Patent Number Patent Owner
Place of
Registration
Registration Date
(dd/mm/yy)
1 Multi-axis drilling machine
ɓ၇εൿ᝝ˆዚ
Utility model 202321249392.6 The Company PRC 10/10/2023
2 Multi-axis drilling machine
ɓ၇εൿ᝝ˆዚ
Utility model 202321249473.6 The Company PRC 25/08/2023
3 Back drilling depth determination
method, back drilling method,
and drilling systemᆽ
ʿ᝝ˆӻ୕
Invention 202111427228.5 The Company PRC 11/02/2022
4 Method for calibrating inter-axis
spacingج
Invention 201611024289.6 The Company PRC 10/05/2019
5 Drill bit outer diameter
measurement method and system
ʿӻ୕
Invention 201110144015.1 The Company PRC 19/02/2014
6 Air clamp and air clamp
adjustment method, PCB board
fixing device ंѰʿंѰሜື˙
ePCBༀໄ
Invention 202010055191.7 The Company PRC 19/07/2022
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 7–


--- page 726 ---
No. Patent Patent Type Patent Number Patent Owner
Place of
Registration
Registration Date
(dd/mm/yy)
7 Two pin accuracy detection method
for drilling machines ᝝ˆዚtwo
pinج
Invention 201711050199.9 The Company PRC 04/08/2020
8 Tool changing method for CNC
machine tools
ج
Invention 201110100710.8 The Company PRC 20/03/2013
9 Placement structure and pin
storage deviceໄഐ࿴ʿቖ৥
ༀໄ
Utility model 202220236131.X The Company PRC 14/06/2022
10 Insertion/extraction mechanism and
processing equipmentዚ࿴
ʿ̋ʈண௪
Utility model 202122134149.7 The Company PRC 22/02/2022
11 Ejection mechanism and PCB
board forming machine ɓ၇୭
ዚ࿴ʿPCBዚ
Invention 202010437622.6 The Company PRC 11/10/2022
12 Printed circuit board processing
method and processing
equipmentج
̋ʈண௪
Invention 202210322537.4 The Company PRC 06/09/2024
13 Broken tool monitoring method
and system for machining
equipmentᓙɠ
ձӻ୕
Invention 200810217876.6 The Company PRC 01/02/2012
14 Alignment exposure device ɓ၇࿁
ЗᖅΈༀໄ
Invention 201910294646.8 The Company PRC 16/07/2021
15 Adsorption control system and
control methodછՓӻ
ج
Invention 202110125738.0 The Company PRC 03/01/2025
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 8–


--- page 727 ---
No. Patent Patent Type Patent Number Patent Owner
Place of
Registration
Registration Date
(dd/mm/yy)
16 Position adjustment mechanism
and laser drilling apparatus ɓ၇
Зໄሜືዚ࿴˸ʿዧΈ᝝ˆༀໄ
Invention 202110431431.3 The Company PRC 18/04/2023
17 Automatic panel flipping
mechanism and PCB board
conveying systemዚ࿴
ʿPCB፩৔ӻ୕
Utility model 202123363862.5 The Company PRC 02/09/2022
18 Anti-adhesion mechanism and
processing equipment ԣῡஹዚ
࿴ʿ̋ʈண௪
Utility model 202122131719.7 The Company PRC 11/03/2022
19 A dual-laser beam drilling
processing system ɓ၇ᕐዧΈҼ
᝝ˆ̋ʈӻ୕
Invention 201811012875.8 The Company PRC 31/01/2023
20 Containment device and lamination
machineॶༀໄʿᄴᏀዚ
Utility model 202420816106.8 The Company,
Shanghai Han’s
Machinery Co.,
Ltd.
PRC 03/01/2025
21 Laser energy control system and
method ዧΈঐඎછՓӻ୕ձ˙
ج
Invention 201811642496.7 The Company PRC 13/10/2022
22 Material positioning/ conveying
device, drilling equipment, and
material positioning/conveying
methodЗ፩৔ༀໄe᝝
ج
Invention 202210434663.9 The Company PRC 09/09/2022
23 Automatic handling mechanism
and processing system Іਗย༶
ዚ࿴ʿ̋ʈӻ୕
Invention 202110219101.8 The Company PRC 18/10/2022
24 Automatic tool changer and
drilling machine ɓ၇Іਗ౬ɠ
ༀໄʿ᝝ˆዚ
Invention 202011607725.9 The Company PRC 19/08/2022
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 1 9–


--- page 728 ---
No. Patent Patent Type Patent Number Patent Owner
Place of
Registration
Registration Date
(dd/mm/yy)
25 Tool assembly replacement device
and replacement method ɠՈଡ଼
һ౬
ج
Invention 202110196469.7 The Company PRC 10/01/2023
26 Pressure positioning device and
PCB drilling machineЗ΁
ༀໄʿPCB᝝ˆዚ
Invention 202210434661.X The Company PRC 11/10/2022
27 Feeding deviceༀໄ Invention 202110242121.7 The Company PRC 06/02/2024
28 Material container and buffer
storage systemᇠπ
ӻ୕
Invention 202210910184.X The Company PRC 16/08/2024
29 Drilling equipment ᝝ˆண௪ Invention 202210451919.7 The Company PRC 09/09/2022
30 Processing method for blind vias
in flexible circuit boardsݓ
ج
Invention 201510142267.9 The Company PRC 09/03/2018
31 Processing method for blind vias
in circuit boardsٛؐ
ج
Invention 201910194687.X The Company PRC 07/12/2021
32 Optimization method for spiral
processing trajectory of FPC
blind holes ɓ၇FPCᑮૅ
ج
Invention 201510142349.3 The Company PRC 09/01/2018
33 Method for improving back
drilling accuracy in PCBs ɓ၇
౤৷PCBج
Invention 201410416104.0 The Company PRC 30/11/2016
34 Drilling equipment and drilling
methodج
Invention 202210452066.9 The Company PRC 15/09/2023
35 Laser processing system ɓ၇ዧΈ
̋ʈӻ୕
Utility model 201720940865.5 The Company PRC 09/03/2018
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 0–


--- page 729 ---
No. Patent Patent Type Patent Number Patent Owner
Place of
Registration
Registration Date
(dd/mm/yy)
36 Three-axis galvanometer coaxial
adjustment device and focal
length confirmation method ɓ၇
ᗝ΍ൿሜືༀໄʿೊ൷ᆽ
ج
Invention 201910153060.X The Company PRC 10/06/2022
37 Zoom punching device ɓ၇ᜊೊә
ˆༀໄ
Utility model 201920429276.X The Company PRC 19/05/2020
38 Beam expander device and laser
equipment ɓ၇ᓒҼᗝༀໄʿዧ
Έண௪
Utility model 201920691045.6 The Company PRC 11/02/2020
39 Laser beam expander and laser
processing equipment ዧΈᓒҼ
ᗝʿዧΈ̋ʈண௪
Invention 202010151194.0 The Company PRC 15/02/2022
40 Material extraction device and
automated equipmentༀໄ
ʿІਗʷண௪
Utility model 202020436661.X The Company PRC 01/01/2021
41 Automatic calibration method for
laser processing equipment and
computer equipment ዧΈ̋ʈண
ၑዚண௪
Invention 202110032318.8 The Company PRC 09/02/2024
42 Laser beam collimation method ዧ
ج
Invention 202110441146.X The Company PRC 15/09/2023
43 Laser power detection device and
laser equipment ዧΈኜ̌ଟᏨ಻
ༀໄ˸ʿዧΈண௪
Utility model 202121935103.9 The Company PRC 11/03/2022
44 Window opening method and
equipmentʿක೿ண௪
Invention 202111347571.9 The Company PRC 03/05/2022
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 1–


--- page 730 ---
No. Patent Patent Type Patent Number Patent Owner
Place of
Registration
Registration Date
(dd/mm/yy)
45 Automatic loading/unloading
device and laser processing
equipmentༀໄʿዧ
Έ̋ʈண௪
Utility model 202323017845.5 The Company PRC 02/08/2024
46 Method and processing system for
slot machining on transparent
materialsɪ̋ʈ
ʿ̋ʈӻ୕
Invention 202410032395.7 The Company PRC 11/06/2024
47 Method for detecting back drilling
depth, signal processing
component, system and program
producte
ۜ
Invention 202511101829.5 The Company PRC 07/08/2025
48 Flexible circuit board processing
method, apparatus, device,
computer equipment and flexible
circuit board̋ʈ˙
ၑዚண௪ʿ
ؐ
Invention 202510339868.2 The Company PRC 21/03/2025
49 Conveying mechanism, conveying
method and laser processing
equipment ɓ၇፩৔ዚ࿴e፩৔
ʿዧΈ̋ʈண௪
Invention 202310970298.8 The Company PRC 02/08/2023
50 Dual galvanometer alarm device,
system and methodᗝజᙆ
ج
Invention 202310887930.2 The Company PRC 19/07/2023
51 Anti-stacking system, anti-stacking
method and PCB processing
system˙
ʿPCB̋ʈӻ୕
Invention 202211729873.7 The Company PRC 30/12/2022
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 2–


--- page 731 ---
No. Patent Patent Type Patent Number Patent Owner
Place of
Registration
Registration Date
(dd/mm/yy)
52 Copper surface marking method,
apparatus, storage medium and
computer equipmentᅺা˙
ၑዚண
௪
Invention 202211583102.1 The Company PRC 09/12/2022
53 Method and apparatus for
determining compensation
accuracy of camera system, and
storage medium໾Ꮅ
eༀໄၾπᎷʧ
ሯ
Invention 202310379009.7 The Company PRC 31/03/2023
54 Method for disassembling collet
and method for installing collet
in circuit board processing
equipment̋ʈண௪
˙
ج
Invention 202210911014.3 The Company PRC 29/07/2022
55 Method, apparatus, device and
medium for acquiring contact
stiffness curveϜᇞᐏ
eༀໄeண௪ձʧሯ
Invention 202211144332.8 The Company PRC 20/09/2022
56 PCB processing method PCB̋
ج
Invention 202211018548.X The Company PRC 24/08/2022
57 Fool-proof control method and
apparatusձༀໄ
Invention 202210455176.0 The Company PRC 24/04/2022
58 Automatic tool magazine changing
system and processing
equipment Іਗ౬ɠᆵӻ୕ʿ̋
ʈண௪
Invention 202210102653.5 The Company PRC 27/01/2022
59 Loading/unloading deviceࣘ
ༀໄ
Invention 202111605784.7 The Company PRC 25/12/2021
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 3–


--- page 732 ---
No. Patent Patent Type Patent Number Patent Owner
Place of
Registration
Registration Date
(dd/mm/yy)
60 Circuit board fabrication method
and circuit boardႡЪ˙
ؐ
Invention 202210302943.4 The Company PRC 25/03/2022
61 Laser drilling method and
processing equipment ዧΈ᝝ˆ
ʿ̋ʈண௪
Invention 202111375310.8 The Company PRC 19/11/2021
62 Laser ablation method ዧΈකˆ˙
ج
Invention 202111375320.1 The Company PRC 19/11/2021
63 Coaxial adjustment device, laser
processing equipment and
coaxial adjustment method Νൿ
ሜືༀໄeዧΈ̋ʈண௪ʿΝൿ
ج
Invention 202 111166470.1 The Company PRC 30/09/2021
64 Laser processing system and its
automatic monitoring method,
apparatus and computer
equipment ዧΈ̋ʈӻ୕ʿՉІ
ၑዚண௪
Invention 202 111190402.9 The Company PRC 13/10/2021
65 Method, apparatus, device and
storage medium for generating
processing path͛ϓ
eༀໄeண௪ʿπᎷʧሯ
Invention 202111269481.2 The Company PRC 28/10/2021
66 Roll material processing method,
apparatus and computer-readable
storage medium̋ʈ˙
ၑዚ̙ᛘπᎷʧሯ
Invention 202110408311.1 The Company PRC 15/04/2021
67 Cutting processing method and
system˸ʿӻ୕
Invention 202110301727.3 The Company PRC 22/03/2021
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 4–


--- page 733 ---
(c) Copyrights
As of the Latest Practicable Date, we had registered the following copyrights which we
consider to be or may be material to our business:
No Copyright Copyright Type Registered Owner Registration Number
Registration Date
(dd/mm/yy)
1 GLM550-TGV drilling software (CN)
(GLM550-TGV ᝝ˆழ΁(CN))
Software The Company 2025SR0424576 11/03/2025
2 ABF Trimming software (CN) (ABF
Trimming ழ΁(CN))
Software The Company 2025SR0426979 11/03/2025
3 New energy battery ultra-long FPC
automatic loading/unloading software
(CN) (ڗFPCІਗɪɨ
ழ΁(CN))
Software The Company 2025SR0131377 20/01/2025
4 Separated bin loading/unloading system
(CN) (ӻ୕ (CN))
Software The Company 2024SR1913803 27/11/2024
5 HD series PCB laser drilling machine
software V1.0 (CN) (HD ӻΐPCBዧ
Έ᝝ˆዚழ΁ V1.0(CN))
Software The Company 2024SR0635191 11/05/2024
6 Dual-layer roller robot
loading/unloading system (CN) ( ᕐᄴ
ӻ୕ (CN))
Software The Company 2024SR0495126 12/04/2024
7 Modal method transient analysis finite
element tool software (CN) (ᐛ
ʩʈՈழ΁ (CN))
Software The Company 2024SR0087605 12/01/2024
8 HLPrinter software (HLPrinter ழ΁) Software The Company 2023SR0956722 21/08/2023
9 Packaging substrate sorting machine
unloading software (ʱౝዚ
ழ΁)
Software The Company 2023SR0894377 04/08/2023
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 5–


--- page 734 ---
No Copyright Copyright Type Registered Owner Registration Number
Registration Date
(dd/mm/yy)
10 Packaging substrate sorting machine
loading software (ʱౝዚɪ
ழ΁)
Software The Company 2023SR0899433 07/08/2023
11 2-axis roll-to-sheet automatic
loading/unloading software (2 ൿ՜࿁
ழ΁ )
Software The Company 2023SR0884707 02/08/2023
12 Automation-specialized software for
laser cutting (UVMaker D650A) ( ͜
ዧΈʲ௲ (UVMaker D650A)Іਗ
ʷਖ਼͜ழ΁ )
Software The Company 2023SR0401724 27/03/2023
13 Laser debonding machine automatic
loading PLC program ( ዧΈৰᇭዚІ
ࣘPLC೻ҏ)
Software The Company 2022SR1496073 11/11/2022
14 Excimer laser etching machine software
(ʱɿዧΈ႙Սዚழ΁ )
Software The Company 2022SR1157277 18/08/2022
15 Trans multi-galvo automatic zoning
(TransᗝІਗʱਜ )
Software The Company 2022SR0813916 22/06/2022
16 Drilling machine HansAuto automation
software ( ᝝ዚHansAuto Іਗʷழ΁ )
Software The Company 2022SR0696156 02/06/2022
17 3D back drilling application software
(3D᝝Ꮠ͜ழ΁ )
Software The Company 2022SR0522105 25/04/2022
18 CNC drilling machine CCD positioning
software ( ᅰછ᝝ዚCCDЗழ΁)
Software The Company 2022SR0045537 07/01/2022
19 Panel flipper control software V2.0 ( ᔕ
ዚછՓழ΁ V2.0)
Software The Company 2016SR172953 08/07/2016
20 Downloading machine control software
V1.0 ( ɨ༱ዚછՓழ΁ V1.0)
Software The Company 2021SR1404267 18/09/2021
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 6–


--- page 735 ---
No Copyright Copyright Type Registered Owner Registration Number
Registration Date
(dd/mm/yy)
21 Uploading machine control software
V1.0 ( ɪ༱ዚછՓழ΁ V1.0)
Software The Company 2021SR1404266 18/09/2021
22 Han’s drilling machine application
software V1.0 ( ɽૄ᝝ˆዚᏐ͜ழ΁
V1.0)
Software The Company 2018SR646355 14/08/2018
23 UVMaker single axis universal laser
cutting software V2.9.0.1 (UVMaker
ஷ͜ዧΈʲ௲ழ΁ V2.9.0.1)
Software The Company 2017SR385436 20/07/2017
24 HANS-F2MID full linear motor two
axis CNC drilling machine control
software V1.0 (HANS-F2MID׌
ཥዚՇൿᅰછ᝝ᇁዚછՓழ΁ V1.0)
Software The Company 2017SR120612 17/04/2017
25 UVDriller drilling machine control
software V2.0 (UVDriller ᝝ˆዚછՓ
ழ΁V2.0)
Software The Company 2017SR057911 27/02/2017
26 Laser cutting machine control software
V1.0 ( ዧΈ൒ʲዚછՓழ΁ V1.0)
Software The Company 2016SR203665 03/08/2016
27 UVMaKer laser cutting software
V2.4.0.1 (UVMaKer ዧΈʲ௲ழ΁
V2.4.0.1)
Software The Company 2015SR228476 20/11/2015
28 DRD650A laser energy control system
V1.0 (DRD650A ዧΈঐඎછՓӻ୕
V1.0)
Software The Company 2021SR1592830 29/10/2021
29 Next-generation laser drilling machine
software V2.3 (ዧΈ᝝ˆዚழ΁
V2.3)
Software The Company 2021SR1626572 03/11/2021
30 HANS HD system CO
2 dual beam dual
stage PCB laser drilling machine
software V1.0 (HANS HD ӻ୕CO
2ᕐ
ΈҼᕐ̨̻ PCBዧΈ᝝ˆዚழ΁ V1.0)
Software The Company 2011SR000274 05/01/2011
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 7–


--- page 736 ---
No Copyright Copyright Type Registered Owner Registration Number
Registration Date
(dd/mm/yy)
31 Han’s open laser cutting and drilling
integration software V1.0 (׳
όዧΈʲ᝝ɓ᜗ʷழ΁ V1.0)
Software The Company 2020SR0345742 20/04/2020
32 UVMaker D650A dual laser cutting
machine software V1.2.0.1 (UVMaker
D650A ᕐዧΈኜʲ௲ዚழ΁ V1.2.0.1)
Software The Company 2020SR0504267 25/05/2020
33 Next-generation, nanosecond laser
control software V1.0 (ዧ
ΈኜછՓழ΁ V1.0)
Software The Company 2020SR0507121 25/05/2020
34 Trimming software v2.0 (Trimming ழ΁
v2.0)
Software The Company 2010SR050143 21/09/2010
35 CO
2 dual beam dual stage PCB laser
drilling machine software (CO 2ᕐΈҼ
ᕐ̨̻PCBዧΈ᝝ˆዚழ΁ )
Software The Company 2010SR045140 31/08/2010
36 Spindle feedback software V1.0 ( ˴ൿˀ
㉿ழ΁V1.0)
Software The Company 2010SR038690 02/08/2010
37 HD600A PCB laser drilling machine
control software (HD600A PCB ዧΈ
᝝ˆዚછՓழ΁ )
Software The Company 2021SR0580465 22/04/2021
(d) Domain name
As of the Latest Practicable Date, we owned the following domain name which we consider
to be or may be material to our business:
No. Domain name Owner
Expiry Date
(dd/mm/yy)
1. hanscnc.com the Company 10/09/2034
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 8–


--- page 737 ---
3. FURTHER INFORMATION ABOUT OUR DIRECTORS
A. Particulars of Directors’ Service Contracts and Appointment Letters
We have entered into a service contract or appointment letter with each of the Directors. The
principal particulars of these service contracts and appointment letters comprise (a) the term of the
service; (b) subject to termination in accordance with their respective term; and (c) a dispute
resolution provision. The service contracts and appointment letters may be renewed in accordance
with our Articles of Association and the applicable laws, rules and regulations from time to time.
Save as disclosed above, none of the Directors has or is proposed to have any service
contracts with any member of the Group (excluding contracts expiring or determinable by the
employer within one year without payment of compensation (other than statutory compensation)).
B. Remuneration of Directors and Supervisors
The aggregate remuneration (including fees, salaries, allowances and benefits in kind,
performance related bonuses, share-based payment compensation and pension scheme
contributions) for the Directors and former supervisors of our Company (the “ Supervisors ”) for
the years ended December 31, 2022, 2023 and 2024 and the ten months ended October 31, 2025
were approximately RMB0.9 million, RMB5.9 million, RMB41.6 million and RMB23.4 million,
respectively.
Based on the current arrangements in force as of the Latest Practicable Date, it is estimated
that the total remuneration for our Directors (including independent non-executive Directors) and
Supervisors for the year ending December 31, 2025 will be approximately RMB27.9 million. The
actual total remuneration of Directors and Supervisors for the year ending December 31, 2025 may
be different from the expected remuneration as the discretionary bonuses will be determined based
on the results of our Company for the year ending December 31, 2025.
Save as disclosed above, there was no other payments paid or payable by our Company or
any of our subsidiaries to our Directors or Supervisors during the Track Record Period.
C. Disclosure of interests
Save as disclosed below, immediately following the completion of the Global Offering and
assuming that the Over-allotment Option is not exercised and no other changes are made to the
issued share capital of our Company between the Latest Practicable Date and the Global Offering,
none of our Directors has any interest and/or short position in the Shares, underlying Shares and
debentures of our Company or our associated corporations (within the meaning of Part XV of the
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 2 9–


--- page 738 ---
SFO) which will be required to be notified to our Company and the Stock Exchange pursuant to
Divisions 7 and 8 of Part XV of the SFO (including interest or short position which they were
taken or deemed to have under such provisions of the SFO) or which will be required, pursuant to
section 352 of the SFO, to be entered in the register referred to therein, or which will be required,
pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers as set out in
Appendix C3 to the Listing Rules to be notified to our Company, once the H Shares are listed on
the Hong Kong Stock Exchange.
(i) Interest in Shares in our Company
Name Position Nature of Interest
Number and
Description of Shares
Approximate
Percentage of
Shareholding in the A
Shares shortly after
the Global Offering
Approximate % of
shareholding in
the Total Issued
Share Capital of
our Company
immediately after the
Global Offering
Mr. Yang Chaohui
(เಃሾ).........
Chairperson of the Board,
executive Director and
General Manager
Beneficial owner
(2) 3,972,217
A Shares
0.93% 0.83%
Beneficial owner (2) 2,814,000
A Shares
0.66% 0.59%
Mr. Zhang Jianqun
(໊).........
Non-executive Director Beneficial owner 284,225 A Shares 0.07% 0.06%
Mr. Zhou Huiqiang
(մሾ੶).........
Non-executive Director Beneficial owner 284,225 A Shares 0.07% 0.06%
Mr. Du Yonggang
(࡝).........
Non-executive Director Beneficial owner 174,597 A Shares 0.04% 0.04%
Note:
(1) The calculation is based on the assumption that the Over-allotment Option is not exercised, and no other changes
are made to the issued share capital of our Company between the Latest Practicable Date and Listing.
(2) As of the Latest Practicable date, Mr. Yang directly held 3,972,217 A Shares in our Company. As of the Latest
Practicable Date, Mr. Yang has been granted 4,200,000 restricted Shares under the 2023 Restricted Share Incentive
Scheme, (i) 1,386,000 of which were vested and issued to Mr. Yang in May 2025, (ii) 1,386,000 of which shall vest
since the first trading day of 28 months after the grant date and until the last trading day before 40 months after the
grant date, and (iii) 1,428,000 of which shall vest since the first trading day of 40 months after the grant date and
until the last trading day before 52 months after the grant date. For details, see “— 4. Our Incentive Scheme”.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 0–


--- page 739 ---
(ii) Interests in the Associated Corporations
Name of Director Name of Associated Corporation Nature of interest
Number and
Description of Shares
Approximate
Percentage of
Interest
Mr. Yang Chaohui ( เಃሾ) .. Han’s Laser Beneficial owner 476,712 A shares 0.05%
Mr. Zhang Jianqun (໊).. Han’s Laser Beneficial owner 248,718 A shares 0.02%
Mr. Zhou Huiqiang ( մሾ੶) . Han’s Laser Beneficial owner 196,822 A shares 0.02%
Mr. Du Yonggang (࡝).. Han’s Laser Beneficial owner 167,702 A shares 0.02%
Save as otherwise disclosed in this Prospectus, our Directors are not aware of any other
person who will, immediately following completion of the Global Offering and assuming that the
Over-allotment Option is not exercised and no changes are made to our outstanding shares between
the Latest Practicable Date and the Listing Date, have an interest or short position in our 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, will be, directly or indirectly, interested in 10% or more of the issued
voting shares of any other member of our Group.
D. Disclaimer
Save as disclosed in this section and the section headed “Business” in this Prospectus:
(a) none of our Directors or the chief executive of our Company has any interest or short
position in the shares, underlying shares or debentures of our Company or any of its
associated corporation (within the meaning of Part XV of the SFO) which will have to
be notified to our Company and the Hong Kong Stock Exchange pursuant to Divisions 7
and 8 of Part XV of the SFO or which will be required, pursuant to section 352 of the
SFO, to be entered in the register referred to therein, or which will be required to be
notified to our Company and the Hong Kong Stock Exchange pursuant to the Model
Code for Securities Transactions by Directors of Listed Issuers once the H Shares are
listed;
(b) none of our Directors or any of the experts referred to under the paragraph headed “—
5. Other Information — E. Qualification of Experts” has any direct or indirect interest
in the promotion of our Company, or in any assets which have within the two years
immediately preceding the date of this Prospectus been acquired or disposed of by or
leased to any member of our Group, or are proposed to be acquired or disposed of by or
leased to any member of our Group;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 1–


--- page 740 ---
(c) none of our Directors is materially interested in any contract or arrangement subsisting
at the date of this Prospectus which is significant in relation to the business of our
Group taken as a whole;
(d) none of our Directors has any existing or proposed service contracts with any member
of our Group (excluding contracts expiring or determinable by the employer within one
year without payment of compensation (other than statutory compensation));
(e) so far as is known to our Directors, no person (not being a Director or chief executive
of our Company or any member of our Group) will, immediately following the
completion of the Global Offering, have an interest or short position in the Shares or
underlying Shares of our Company which would fall to be disclosed to our Company
under the provisions of Divisions 2 and 3 of Part XV of SFO or be interested, directly
or indirectly, in 10% or more of the nominal value of any class of share capital carrying
rights to vote in all circumstances at general meetings of any member of our Group; and
(f) none of our Directors or their respective close associates (as defined under the Listing
Rules) or our Shareholders who are interested in more than 5% of the issued share
capital of our Company has any interest in the five largest customers or the five largest
suppliers of our Group.
4. OUR INCENTIVE SCHEME
2023 Restricted Share Incentive Scheme
The following is a summary of the principal terms of the 2023 restricted share incentive
scheme (the “ 2023 Restricted Share Incentive Scheme ”). The terms of 2023 Restricted Share
Incentive Scheme are not subject to the provisions of Chapter 17 of the Listing Rules as they do
not involve any grant of Share Awards by our Company after our Listing.
(i) Purpose
The purpose of the 2023 Restricted Share Incentive Scheme is to improve our Group’s
long-term incentive mechanism, attract and retain outstanding talents, fully mobilize the
enthusiasm of our Group’s key employees, and align the interests of our Shareholders, our Group
and our key employees.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 2–


--- page 741 ---
(ii) Administration
The 2023 Restricted Share Incentive Scheme is subject to the approval of the Shareholders’
general meeting, administration of the Board and the supervision of the board of supervisors and
independent directors.
(iii) Participants
The participants of the 2023 Restricted Share Incentive Scheme include Directors, senior
management and key technical (business) employees of our Group, excluding independent
Directors, supervisors and shareholders or actual controllers who collectively hold more than 5%
of the Company’s shares and their spouses, parents, children, and foreign employees.
(iv) Maximum number of Shares
The maximum number of Shares underlying the Share Awards that can be granted under the
2023 Restricted Shares Incentive Scheme is 16,800,000 A Shares.
(v) Date of grant and term of the Scheme
The date on which the Share Awards are granted shall be determined by the Board after
approval of the 2023 Restricted Share Incentive Scheme by the Shareholders’ general meeting. The
grant of Share Awards shall be approved by the Board, registered and announced within 60 days
after the date of approval of the 2023 Restricted Share Incentive Scheme by the Shareholders’
general meeting. The 2023 Restricted Share Incentive Scheme shall be effective from the date of
completion of the grant of Share Awards under the scheme up to the date when all of the Share
Awards granted under the scheme have been vested or cancelled, provided that the term of the
scheme shall not exceed 52 months.
(vi) Lock-up for Directors and the senior management team
If the grantee is a Director or a senior management of our Company, during the period of the
term of employment, the Shares to be transferred in each year shall not exceed 25% of the total
Shares he or she holds. No share held by such Director or senior management can be transferred
within six months after termination of his or her employment. If the grantee is a Director or senior
management of our Company, income gained through sale of Shares within six months of the
purchase or purchase of Shares within six months of the sale shall belong to our Company and will
be forfeited by the Board. If there is any change in the applicable laws and regulations on the
foregoing lock-up requirements, the grantee shall comply with the amended laws and regulations.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 3–


--- page 742 ---
(vii) Conditions to the grant of Share Awards
The Share Awards under the 2023 Restricted Share Incentive Scheme will only be granted to
selected participants if the following conditions are fulfilled:
(a) with respect to our Company, none of the following circumstances having occurred:
(1) an audit report with an adverse opinion or a disclaimer of opinion has been issued
by the reporting accountants with respect to our Company’s accountants’ report for
the most recent fiscal year;
(2) an audit report with an adverse opinion or a disclaimer of opinion has been issued
by the reporting accountants with respect to the internal control report contained in
accountants’ report for the most recent fiscal year;
(3) our Company has not distributed dividends in accordance with the laws and
regulations, our Articles of Association or our public commitment within the last
36 months after its listing;
(4) applicable laws and regulations prohibit the implementation of any share incentive
scheme; or
(5) any other circumstances determined by the CSRC.
(b) with respect to a grantee, none of the following circumstances having occurred:
(1) the grantee has been regarded as an inappropriate person by the stock exchange
within the last 12 months;
(2) the grantee has been regarded as an inappropriate person by the CSRC or its local
office within the last 12 months;
(3) the grantee has been punished or prohibited from entering into the securities
market by the CSRC or its local office within the last 12 months;
(4) the grantee is not qualified to serve as a director or senior management according
to the PRC Company Law;
(5) the grantee is prohibited from participating in any incentive plan of listed
companies according to applicable laws and regulations; or
(6) any other circumstances determined by the CSRC.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 4–


--- page 743 ---
(viii) V esting of Share Awards
The vesting period for Share Awards commences from date of grant of Share Awards to the
grantee and the interval between the date of completion of the grant and the date of vesting of the
Share Awards shall be twelve months. During the vesting period, the Share Awards granted to the
grantee shall not be transferred, used as guarantee or for repayment of debt. In addition, the Share
Awards will only be vested when both company-level performance assessment and individual-level
performance assessment as set out under the scheme are achieved.
The Share Awards will be vested in traches of 33%, 33% and 34% in each of the three
vesting periods that occur between the first trading date after the 16-month anniversary from the
date of grant and the lasting trading date up to the 52-month anniversary of the date of grant.
(ix) Exercise of Share Awards
The grantees shall pay the exercise price upon fulfilment of all the conditions of the Share
Awards to purchase the A Shares from our Company. The exercise price of each Share Award shall
be RMB19.38 per each Share. The exercise price of the Share Awards was adjusted by resolutions
of the Board and the supervisory committee of the Company from RMB19.38 per A Share to
RMB18.98 per A Share in view of the Company’s cash dividend scheme for the year ended
December 31, 2024.
(x) Outstanding Share Awards
As of the Latest Practicable Date, (i) our Company granted Share Awards under the 2023
Restricted Share Incentive Scheme to subscribe for an aggregate of 16,800,000 A Shares, and the
maximum number of Shares that can be granted under the 2023 Restricted Share Incentive Scheme
had been granted; and (ii) the total number of A Shares underlying the outstanding Share Awards
which had not been vested (excluding any Share Awards which have been forfeited, expired or
cancelled) under the 2023 Restricted Share Incentive Scheme amounted to 11,195,298,
representing approximately 2.35% of the total issued Shares immediately following the completion
of the Global Offering (assuming the Over-allotment Option is not exercised and no other changes
are made to the issued share capital of our Company between the Latest Practicable Date and the
Listing Date), which will be settled by newly issued A Shares pursuant to the vesting schedule.
Among the Share Awards which had not been vested (excluding any Share Awards which have
been forfeited, expired or cancelled), Share Awards representing in aggregate 2,814,000 A Shares,
1,587,900 A Shares, 304,180 A Shares and 6,489,218 A Shares were granted to one Director, eight
senior management members, three connected persons and 365 key employees of our Company,
respectively, accounting for approximately 0.59%, 0.33%, 0.06% and 1.36% of the total issued
Shares upon completion of the Global Offering (assuming the Over-allotment Option is not
exercised and no other changes are made to the issued share capital of our Company between the
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 5–


--- page 744 ---
Latest Practicable Date and the Listing Date). As of the Latest Practicable Date, none of the
grantees of the Share Awards under the 2023 Restricted Share Incentive Scheme were consultants
of our Company.
The following table sets forth the details of the Share Awards granted under the 2023
Restricted Share Incentive Scheme as of the Latest Practicable Date:Name of grantee Position in our Company Address Date of grant
Number of
Share Awards
granted Exercise Price
Vesting date/
period
Approximate
percentage of
issued Share
Capital
immediately
after
completion of
the Global
Offering (1)
(RMB per A
Share) (%)
Mr. YANG
Chaohui
(เಃሾ) ...
Chairperson of the Board,
executive Director and
general manager
Block B, Building 17, Shenye New
Coastline, No. 203 Baoyuan South
Road, Bao’an District, Shenzhen,
Guangdong Province, China
December 8,
2023
1,386,000 18.98
(2) Note (3) 0.29
1,386,000 18.98 (2) Note (4) 0.29
1,428,000 18.98 (2) Note (5) 0.30
Mr. ZHOU
Xiaodong
(؇)...
Deputy general manager,
financial director and
board secretary
Yecheng Pavilion, Xinzhou Road,
Futian District, Shenzhen,
Guangdong Province, China
December 8,
2023
99,000 18.98
(2) Note (3) 0.02
99,000 18.98 (2) Note (4) 0.02
102,000 18.98 (2) Note (5) 0.02
Mr. ZHAI
Xuetao
(ၱኪᏹ) ...
Deputy general manager Fifth Industrial Zone, Songpingshan,
Nanshan District, Shenzhen,
Guangdong Province, China
December 8,
2023
99,000 18.98
(2) Note (3) 0.02
99,000 18.98 (2) Note (4) 0.02
102,000 18.98 (2) Note (5) 0.02
Mr. LI Yongjun
(ࠏۇ)...
Deputy general manager Huijin Pavilion, Huibin Plaza,
Dongbin Road, Nanshan District,
Shenzhen, Guangdong Province,
China
December 8,
2023
108,900 18.98
(2) Note (3) 0.02
108,900 18.98 (2) Note (4) 0.02
112,200 18.98 (2) Note (5) 0.02
Ms. KOU Lian
(੒๪) ....
Deputy general manager No. 12 Chongqing Road, Fuhai
Subdistrict, Bao’an District,
Shenzhen, Guangdong Province,
China
December 8,
2023
99,000 18.98
(2) Note (3) 0.02
99,000 18.98 (2) Note (4) 0.02
102,000 18.98 (2) Note (5) 0.02
Ms. SHE Rong
(ᠮႂ) ....
Deputy general manager Hancheng, Xiangmihu, Futian District,
Shenzhen, Guangdong Province,
China
December 8,
2023
99,000 18.98
(2) Note (3) 0.02
99,000 18.98 (2) Note (4) 0.02
102,000 18.98 (2) Note (5) 0.02
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 6–


--- page 745 ---
Name of grantee Position in our Company Address Date of grant
Number of
Share Awards
granted Exercise Price
Vesting date/
period
Approximate
percentage of
issued Share
Capital
immediately
after
completion of
the Global
Offering (1)
(RMB per A
Share) (%)
Mr. SONG
Jiangtao
(҂Ϫᏹ) ...
Deputy general manager Building 8, Bolin Tianrui, Liuxian
Avenue, Nanshan District,
Shenzhen, Guangdong Province,
China
December 8,
2023
99,000 18.98
(2) Note (3) 0.02
99,000 18.98 (2) Note (4) 0.02
102,000 18.98 (2) Note (5) 0.02
Mr. ZHANG
Jianzhong
(ʕ) ...
Deputy general manager Building 8, Shenfang Chuanqi
Mountain, Guangming Subdistrict,
Guangming District, Shenzhen,
Guangdong Province, China
December 8,
2023
89,100 18.98
(2) Note (3) 0.02
89,100 18.98 (2) Note (4) 0.02
91,800 18.98 (2) Note (5) 0.02
Mr. LV Hongjie
(௫) ...
Deputy general manager Building 3, Phase 5, Xiangshanli
Garden, No. 18 Qiaobei Third
Street, Nanshan District, Shenzhen,
Guangdong Province, China
December 8,
2023
89,100 18.98
(2) Note (3) 0.02
89,100 18.98 (2) Note (4) 0.02
91,800 18.98 (2) Note (5) 0.02
Other
Connected
Persons as set
out below
(6) .
December 8,
2023
149,820 18.98 (2) Note (3) 0.03
149,820 18.98 (2) Note (4) 0.03
154,360 18.98 (2) Note (5) 0.03
Mr. XIAO He
(ئ)...
General manager and
director of Mason
Electronics
Building 8, Bolin Tianrui, Liuxian
Avenue, Nanshan District,
Shenzhen, Guangdong Province,
China
December 8,
2023
99,000 18.98
(2) Note (3) 0.02
99,000 18.98 (2) Note (4) 0.02
102,000 18.98 (2) Note (5) 0.02
Ms. SU Xiyu
(ڠ)..
Supervisor of Mason
Electronics
Building 13, Area 34, Keyuan Garden,
Nanshan District, Shenzhen,
Guangdong Province, China
December 8,
2023
19,140 18.98
(2) Note (3) 0.004
19,140 18.98 (2) Note (4) 0.004
19,720 18.98 (2) Note (5) 0.004
Ms. ZHANG
Ling (ޛ).
Supervisor of Mason
Electronics
Huizhong Mingyuan, Dengliang Road,
Nanshan Subdistrict, Nanshan
District, Shenzhen, Guangdong
Province, China
December 8,
2023
31,680 18.98
(2) Note (3) 0.007
31,680 18.98 (2) Note (4) 0.007
32,640 18.98 (2) Note (5) 0.007
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 7–


--- page 746 ---
Range of total Shares
Underlying the outstanding
Share Awards granted
under the 2023 Restricted
Share Incentive Scheme Total number of grantees Date of grant
Number of
Share
Awards
granted
Exercise
Price
Vesting date/
period
Approximate
percentage of issued
Share Capital
immediately after
completion of the
Global Offering
(1)
1 to 9,999 ....... 164 December 8, 2023 409,497 18.98 (2) Note (4) 0.09
December 8, 2023 421,906 18.98 (2) Note (5) 0.09
10,000 to 19,999 ... 104 December 8, 2023 643,665 18.98 (2) Note (4) 0.14
December 8, 2023 663,170 18.98 (2) Note (5) 0.14
20,000 to 29,999 .... 50 December 8, 2023 580,965 18.98 (2) Note (4) 0.12
December 8, 2023 598,570 18.98 (2) Note (5) 0.13
30,000 to 49,999 ... 29 December 8, 2023 528,792 18.98 (2) Note (4) 0.11
December 8, 2023 544,816 18.98 (2) Note (5) 0.11
50,000 to 99,999 .... 9 December 8, 2023 294,690 18.98 (2) Note (4) 0.06
December 8, 2023 303,620 18.98 (2) Note (5) 0.06
100,000 to 300,000 .. 9 December 8, 2023 738,573 18.98 (2) Note (4) 0.16
December 8, 2023 760,954 18.98 (2) Note (5) 0.16
Total .......... 365 key employees December 8, 2023 3,196,182 18.98 (2) Note (4) 0.67
December 8, 2023 3,293,036 18.98 (2) Note (5) 0.69
Notes:
(1) The calculation is based on the assumption that no new Shares are issued under the Over-allotment Option, and no
other changes are made to the issued share capital of our Company between the Latest Practicable Date and Listing
Date.
(2) The exercise price of the Share Awards was adjusted by resolutions of the Board and the supervisory committee of
the Company from RMB19.38 per A Share to RMB18.98 per A Share in view of the Company’s cash dividend
scheme for the year ended December 31, 2024. No consideration was required from and no consideration was paid
by the grantees for the grant of the Share Awards under the 2023 Restricted Share Incentive Scheme.
(3) 33% of the total granted Share Awards were vested on May 21, 2025.
(4) 33% of the total granted Share Awards shall vest since the first trading day of 28 months after the grant date and
until the last trading day before 40 months after the grant date.
(5) The remaining 34% of the total granted Share Awards shall vest since the first trading day of 40 months after the
grant date and until the last trading day before 52 months after the grant date.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 8–


--- page 747 ---
5. OTHER INFORMATION
A. Estate Duty
Our Directors have been advised that no material liability for estate duty under PRC laws is
likely to fall upon any member of our Group.
B. Litigation
Save as disclosed in the sections headed “Business” and “Financial Information” in this
Prospectus, no member of our Group is 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 our Company that would have a material adverse effect
on our Company’s results of operations or financial condition.
C. Sole Sponsor
The Sole Sponsor has made an application on behalf of our Company to the Listing
Committee for listing of, and permission to deal in, the H Shares of our Company.
The Sole Sponsor satisfies the independence criteria applicable to sponsor 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 fee of US$480,000 to act as the sponsor of our
Company in connection with the proposed listing on the Hong Kong Stock Exchange.
D. Compliance Adviser
Our Company has appointed Somerley Capital Limited as our compliance adviser in
compliance with Rules 3A.19 of the Listing Rules.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 3 9–


--- page 748 ---
E. Qualification of Experts
The qualification of the experts, as defined under the Listing Rules, who have given opinions
in this Prospectus are as follows:
Name Qualification
China International Capital
Corporation Hong Kong
Securities Limited
A licensed corporation to conduct type 1 (dealing in
securities), type 2 (dealing in futures contracts), type 4
(advising on securities), type 5 (advising on futures
contracts) and type 6 (advising on corporate finance) of the
regulated activities as defined under the SFO
China Commercial Law Firm Legal adviser to our Company as to PRC law
Ernst & Young Certified Public Accountants and Registered Public Interest
Entity Auditor
China Insights Industry Consultancy
Limited
Independent industry consultant
F. Consents of Experts
Each of the experts as referred to in “— 5. Other Information — E. Qualification of Experts”
in this Appendix has given and has not withdrawn its consent to the issue of this Prospectus with
the inclusion of its view, report, letter and/or legal opinion (as the case may be) and references to
its name included herein in the form and context in which it respectively appears.
None of the experts named above has any shareholding interest in any member of our Group
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.
G. Binding Effect
This Prospectus shall have the effect, if an application is made in pursuance hereof, of
rendering all persons concerned bound by all 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.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 4 0–


--- page 749 ---
H. No Material Adverse Change
Our Directors confirm that, there has been no material adverse change in our business,
financial condition and results of operations since October 31, 2025, being the latest balance sheet
date of our consolidated financial statements as set out in the Accountants’ Report in Appendix I
to this Prospectus, and up to the date of this Prospectus.
I. Taxation of Holders of H Shares
The sale, purchase and transfer of H Shares are subject to Hong Kong stamp duty if such
sale, purchase and transfer are affected on the H Share register of members of our Company,
including in circumstances where such transactions are effected on the Stock Exchange. The
current rate of Hong Kong stamp duty for such sale, purchase and transfer on each of the
purchaser and the seller is 0.1% of the consideration or, if higher, the fair value of the H Shares
being sold or transferred.
J. Restriction on Share Repurchases
For details of the restrictions on share repurchases by our Company, please refer to
“Appendix V — Summary of the Articles of Association — Increase, Decrease and Repurchase of
Shares” in this Prospectus.
K. Preliminary Expenses
We have not incurred any material preliminary expenses.
L. Promoters
Within two years immediately preceding the date of this Prospectus, no cash, securities or
other benefit has been paid, allotted or given nor is any proposed to be paid, allotted or given to
any promoters in connection with the Global Offering and the related transactions described in this
Prospectus.
M. Related Party Transactions
Our Group entered into the related party transactions within the two years immediately
preceding the date of this Prospectus as mentioned in “Appendix I — Accountants’ Report — 44.
Related Party Transactions” in this Prospectus.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 4 1–


--- page 750 ---
N. Miscellaneous
Save as disclosed in this Prospectus:
(a) within the two years immediately preceding the date of this Prospectus:
(i) no share or loan capital of our Company or any of our subsidiaries had been issued
or agreed to be issued or proposed to be fully or partly paid either for cash or a
consideration other than cash;
(ii) no share or loan capital of our Company or any of our subsidiaries had been under
option or is agreed conditionally or unconditionally to be put under option;
(iii) no commissions, discounts, brokerages or other special terms had been granted or
agreed to be granted in connection with the issue or sale of any share or loan
capital of our Company or any of our subsidiaries; and
(iv) no commission had been paid or payable for subscription, agreeing to subscribe,
procuring subscription or agreeing to procure subscription of any share in our
Company or any of our subsidiaries;
(b) there are no founder, management or deferred shares, convertible debt securities nor any
debentures in our Company or any of our subsidiaries;
(c) there has not been any interruption in the business of our Group which may have or has
had a significant effect on the financial position of our Group in the 12 months
preceding the date of this Prospectus;
(d) our Company has no outstanding convertible debt securities or debentures;
(e) there is no arrangement under which future dividends are waived or agreed to be
waived;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 4 2–


--- page 751 ---
(f) save for the A Shares of our Company that are listed on the Shenzhen Stock Exchange,
and save for the H Shares to be issued in connection with the Global Offering, none of
the equity and debt securities of our Company, if any, is listed or dealt with in any other
stock exchange nor is any listing or permission to deal being or proposed to be sought;
and
(g) all necessary arrangements have been made to enable the H Shares to be admitted into
CCASS for clearing and settlement.
O. Bilingual Prospectus
The English language and Chinese language versions of this Prospectus are being published
separately in reliance upon the exemption provided by section 4 of the Companies (Exemption of
Companies and Prospectuses from Compliance with Provisions) Notice (Chapter 32L of the Laws
of Hong Kong).
APPENDIX VI STATUTORY AND GENERAL INFORMATION
–V I - 4 3–


--- page 752 ---
A. DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES IN HONG KONG
The documents attached to the copy of this Prospectus delivered to the Registrar of
Companies in Hong Kong for registration were:
(a) a copy of each of the material contracts referred to in the section headed “Appendix VI
— Statutory and General Information — 2. Further Information about Our Business —
A. Summary of Material Contracts” in this Prospectus; and
(b) the written consents referred to in the section headed “Appendix VI — Statutory and
General Information — 5. Other Information — F. Consents of Experts” in this
Prospectus.
B. DOCUMENTS A V AILABLE ON DISPLAY
Electronic copies of the following documents will be available on display on our website at
https://www.hanscnc.com/
and on the website of the Stock Exchange at www.hkexnews.hk
during a period of 14 days from the date of this Prospectus:
(a) the Articles of Association;
(b) the accountants’ report from Ernst & Young, the text of which is set forth in Appendix I
to this Prospectus;
(c) the audited consolidated financial statements of our Group for the years ended
December 31, 2022 and 2023 and 2024 and the ten months ended October 31, 2025;
(d) the report from Ernst & Young on the unaudited pro forma financial information of our
Group, the text of which is set forth in Appendix II to this Prospectus;
(e) the letters in respect of the profit estimate of our Group from Ernst & Young, the
reporting accountants, and China International Capital Corporation Hong Kong
Securities Limited, the Sole Sponsor, the texts of which are set out in Appendix IIA;
(f) the industry report issued by China Insights Consultancy referred to in the section
headed “Industry Overview” in this Prospectus;
(g) the PRC legal opinions issued by China Commercial Law Firm in respect of certain
general corporate matters and property interests under PRC laws;
APPENDIX VII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VII-1 –


--- page 753 ---
(h) the material contracts referred to in the section headed “Appendix VI — Statutory and
General Information — 2. Further Information about Our Business — A. Summary of
Material Contracts” in this Prospectus;
(i) the written consents referred to in the section headed “Statutory and General
Information — 5. Other Information — F. Consents of Experts” in this Prospectus;
(j) the service contracts and appointment letters referred to in the section headed
“Appendix VI — Statutory and General Information — 3. Further Information about
Our Directors — A. Particulars of Directors’ Service Contracts and Appointment
Letters” in this Prospectus;
(k) the terms of the 2023 Restricted Share Incentive Scheme; and
(l) the PRC Company Law, Securities Law, and the Trial Measures for the Administration
Related to the Overseas Securities Offering and Listing by Domestic Companies,
together with unofficial English translations thereof.
DOCUMENTS A V AILABLE FOR INSPECTION
A copy of a full list of grantees under the 2023 Restricted Share Incentive Scheme,
containing all details as required under the Listing Rules and the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, will be available for inspection at the office of Clifford
Chance at 27/F, Jardine House, One Connaught Place, Central, Hong Kong during normal business
hours up to and including the date which is 14 days from the date of this Prospectus.
APPENDIX VII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VII-2 –


--- page 754 ---
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(A joint stock company incorporated in the People’s Republic of China with limited liability)
Stock Code : 3200
GLOBAL
OFFERING
Sole Sponsor, Sponsor-Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
