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CiDi Inc.
希迪智駕科技股份有限公司
CiDi Inc.
希迪智駕科技股份有限公司
希迪智駕科技股份有限公司
(A joint stock company incorporated in the People's Republic of China with limited liability)
Stock Code: 3881
Joint Sponsors, Overall Coordinators,
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
GLOBAL
OFFERING
GLOBAL
OFFERING
C
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CM
MY
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CMY
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Project Nova Cover V14D_ENG_38mm_OP.pdf   1   9/12/2025   下午8:54


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If you are in any doubt about any of the contents of this prospectus, you should obtain independent professional advice.
CiDi Inc.
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
: 5,407,980 H Shares (subject to the Over-allotment
Option)
Number of Hong Kong Offer Shares : 270,400 H Shares (subject to adjustment)
Number of International Offer Shares : 5,137,580 H Shares (subject to adjustment and the
Over-allotment Option)
Offer Price : HK$263.00 per H Share, plus brokerage of 1.0%, SFC
transaction levy of 0.0027%, AFRC transaction levy
of 0.00015% and Hong Kong Stock Exchange
trading fee of 0.00565% (payable in full on
application in Hong Kong dollars and subject to
refund)
Nominal value : RMB1.00 per H Share
Stock code : 3881
Joint Sponsors, Overall Coordinators, Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
Joint Bookrunners and Joint Lead Managers
Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no
responsibility for the contents of this prospectus, make no representation as to its accuracy or completeness and expressly disclaim any liability
whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this prospectus.
A copy of this prospectus, having attached thereto the documents specified in “Documents Delivered to the Registrar of Companies in Hong Kong and
Available on Display” in Appendix VIII to this prospectus, has been registered by the Registrar of Companies in Hong Kong as required by Section 342C
of the Companies (Winding up and 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 Kong take no responsibility as to the contents of this prospectus or any other documents referred
to above.
The Offer Price per Offer Share will be HK$263.00 per Offer Share, unless otherwise announced. Applicants for the Hong Kong Offer Shares are required
to pay (subject to application channels), on application, the Offer Price of HK$263.00 for each Hong Kong Offer Share together with brokerage fee of
1.0%, SFC transaction levy of 0.0027%, the AFRC transaction levy of 0.00015% and Hong Kong Stock Exchange trading fee of 0.00565%.
The Overall Coordinators, on behalf of the Underwriters, and with our consent may, where considered appropriate, reduce the number of Hong
Kong Offer Shares and/or the Offer Price below that is stated in this prospectus at any time prior to the morning of the last day for lodging
applications under the Hong Kong Public Offering. In such a case, notices of the reduction in the number of Hong Kong Offer Shares will be
published on the website of our Company at www.cidi.ai
and on the website of the Hong Kong Stock Exchange at www.hkexnews.hk . Further
details are set forth in “Structure of the Global Offering” and “How to Apply 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 Overall
Coordinators (on behalf of the Hong Kong Underwriters) if certain grounds arise prior to 8:00 a.m. on the Listing Date. See “Underwriting —
Grounds for Termination” of this Prospectus .
Our Company is a Specialist Technology Company (as defined in Chapter 18C of the Listing Rules). The securities of Specialist Technology
Companies carry high investment risks including risks of share price volatility and inflated valuation due to the difficulty in valuing such
companies. Investors should fully understand the investment risks of a Specialist Technology Company and the risks disclosed by our Company
before making their investment decisions.
The Offer Shares have not been and will not be registered under the U.S. Securities Act or securities law of any state in the United States and may be
offered and sold only outside the United States in offshore transactions according to Regulation S under the U.S. Securities Act.
IMPORTANT
December 11, 2025


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


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Your application must be for a minimum of 10 Hong Kong Offer Shares and in one of the
numbers set out in the table. You are required to pay the amount next to the number you select. 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
amount payable on application in full upon application for Hong Kong Offer Shares. If you are
applying through the HKSCC EIPO channel, you are required to pre-fund your application based
on the amount specified by your broker or custodian, as determined based on the applicable laws
and regulations in Hong Kong.
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application/
successful allotment
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application/
successful allotment
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application/
successful allotment
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application/
successful allotment
HK$ HK$ HK$ HK$
10 2,656.52 250 66,413.09 3,000 796,957.06 60,000 15,939,141.30
20 5,313.05 300 79,695.71 4,000 1,062,609.42 70,000 18,595,664.86
30 7,969.57 350 92,978.33 5,000 1,328,261.78 80,000 21,252,188.40
40 10,626.09 400 106,260.94 6,000 1,593,914.14 90,000 23,908,711.96
50 13,282.62 450 119,543.57 7,000 1,859,566.49 100,000 26,565,235.50
60 15,939.14 500 132,826.18 8,000 2,125,218.85 110,000 29,221,759.06
70 18,595.67 600 159,391.42 9,000 2,390,871.20 120,000 31,878,282.60
80 21,252.19 700 185,956.65 10,000 2,656,523.56 135,200
(1) 35,916,198.40
90 23,908.72 800 212,521.89 20,000 5,313,047.10
100 26,565.24 900 239,087.12 30,000 7,969,570.66
150 39,847.86 1,000 265,652.35 40,000 10,626,094.20
200 53,130.47 2,000 531,304.71 50,000 13,282,617.76
Notes:
(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.
No application for any other number of the Hong Kong Offer Shares will be considered and
any such application is liable to be rejected.
IMPORTANT


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If there is any change in the following expected timetable of the Hong Kong Public Offering,
we will issue an announcement in Hong Kong to be published on the websites of the Stock
Exchange at www.hkexnews.hk
and our Company at www.cidi.ai .
Hong Kong Public Offering commences ...................................9 : 0 0a . m .o n
Thursday, December 11, 2025
Latest time for completing electronic applications
under the HK eIPO White Form service through
the designated website at www.hkeipo.hk (ii) .............................1 1 : 3 0a . m .o n
Tuesday, December 16, 2025
Application lists for the Hong Kong Public
Offering open (iii) ..................................................1 1 : 4 5a . m .o n
Tuesday, December 16, 2025
Latest time for (a) completing payment for the HK eIPO
White Form applications by effecting internet banking
transfer(s) or PPS payment transfer(s) and (b) giving
electronic application instructions to HKSCC
(iv) ........................1 2 : 0 0 noon on
Tuesday, December 16, 2025
If you are instructing your broker or custodian who is a HKSCC Participant to give
electronic application instructions through 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 (iii) .............................................1 2 : 0 0 noon on
Tuesday, December 16, 2025
(i) Announcement of:
 an indications of the level of interest in the International Placing, the level of
applications in the Hong Kong Public Offering; and
 the basis of allocations of the Hong Kong Offer Shares
to be published on our website at www.cidi.ai
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, December 18, 2025
EXPECTED TIMETABLE (i)
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(ii) Announcement of results of allocations in the Hong Kong
Public Offering to be available through a variety of channels
as described in “How to apply for Hong Kong
Offer Shares — B. Publication of Results” from .......................1 1 : 0 0p . m .o n
Thursday, December 18, 2025
(iii) Announcement of the Hong Kong Public Offering containing
(i) and (ii) above to be published on the websites of
the Company and the Stock Exchange at
www.cidi.ai
(vi) and www.hkexnews.hk f r o m ..........................1 1 : 0 0p . m .o n
Thursday, December 18, 2025
Results of allocation for the Hong Kong Public Offering
will be available at “Allotment Results”
page at www.hkeipo.hk/IPOResult
(or
www.tricor.com.hk/ipo/result ) with a
“search by ID” function from ........................................1 1 : 0 0p . m .o n
Thursday, December 18, 2025 to
12:00 midnight on
Wednesday, December 24, 2025
Dispatch of H Share certificates or deposit of H Share certificates
into CCASS in respect of wholly or partially successful
applications pursuant to the Hong Kong Public Offering
on or before
(vii) ...................................... Thursday, December 18, 2025
Dispatch of HK eIPO White Form e-Auto Refund payment
instructions/refund checks on or before (viii) ....................F r i d a y , December 19, 2025
Dealings in the H Shares on the Stock Exchange expected
to commence at ....................................................9 : 0 0a . m .o n
Friday, December 19, 2025
Notes:
(i) All dates and times refer to Hong Kong local times and dates, except as otherwise stated.
(ii) 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 a payment 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 the application
monies) until 12:00 noon on the last day for submitting applications, when the application lists close.
EXPECTED TIMETABLE (i)
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(iii) If there is a “black” rainstorm warning signal or a tropical cyclone warning signal number 8 or above and/or
Extreme Conditions in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Tuesday, December
16, 2025, the application lists will not open and close on that day. See “How to Apply for Hong Kong Offer Shares
— E. Bad weather arrangements.”
(iv) Applicants who apply for the Hong Kong Offer Shares by giving electronic application instructions to HKSCC
through HKSCC’s FINI system should refer to section headed “How to Apply for Hong Kong Offer Shares — A.
Applications for Hong Kong Offer Shares — 2. Application Channels.”
(v) None of the websites or any of the information contained on the website forms part of this Prospectus.
(vi) The H Share certificates will only become valid evidence of title at 8:00 a.m. on the Listing Date, which is
expected to be Friday, December 19, 2025, provided that the Global Offering has become unconditional in all
respects and none of the Underwriting Agreements have been terminated in accordance with its terms at or before
that time. Investors who trade Shares on the basis of publicly available allocation details prior to the receipt of the
H Share certificates and prior to the H Share certificates becoming valid evidence of title do so entirely at their
own risk.
The above expected timetable is a summary only. Y ou should read carefully the sections headed
“Underwriting” and “Structure of the Global Offering” and “How to Apply for Hong Kong Offer Shares” for
details relating to the Structure of the Global Offering, procedures on the applications for Hong Kong Offer Shares,
and expected timetable, including conditions, effect of bad weather and the dispatch of refund cheques and H Share
Certificates.
EXPECTED TIMETABLE (i)
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IMPORTANT NOTICE TO PROSPECTIVE INVESTORS
This prospectus is issued by our Company solely in connection with the Hong Kong Public
Offering and the Hong Kong Offer Shares and does not constitute an offer to sell or a
solicitation of an offer to subscribe for or buy any security other than the Hong Kong Offer
Shares. This prospectus may not be used for the purpose of, and does not constitute, an offer to
sell or a solicitation of an offer to subscribe for or buy any security in any other jurisdiction or
in any other circumstances. No action has been taken to permit a public offering of the Offer
Shares or the distribution of this prospectus in any jurisdiction other than Hong Kong. The
distribution of this prospectus and the offering and sale of the Offer Shares in other
jurisdictions are subject to restrictions and may not be made except as permitted under the
applicable securities laws of such jurisdictions pursuant to registration with or authorization by
the relevant securities regulatory authorities or an exemption therefrom.
You should rely only on the information contained in this prospectus to make your
investment decision. We have not authorized anyone to provide you with information that is
different from what is contained in this prospectus. Any information or representation not
included in this prospectus must not be relied on by you as having been authorized by us, the
Joint Sponsors, the Joint Overall Coordinators, the Capital Market Intermediaries, the Joint
Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Underwriters, any of
our or their respective directors or advisors, or any other person or party involved in the
Global Offering. Information contained on our website, located at www.cidi.ai
, does not form
part of this prospectus.
Page
Expected Timetable .................................................... i
Contents ............................................................. i v
Summary ............................................................ 1
Definitions ............................................................ 3 2
Glossary of Technical Terms ............................................. 4 4
Forward-Looking Statements ............................................. 5 1
Risk Factors .......................................................... 5 3
CONTENTS
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Waivers from Strict Compliance with the Hong Kong Listing Rules ............. 9 8
Information about this Prospectus and the Global Offering .................... 1 0 6
Directors and Parties Involved in the Global Offering ........................ 1 1 3
Corporate Information .................................................. 1 2 4
Industry Overview ..................................................... 1 2 7
Regulatory Overview .................................................... 1 5 0
History, Development and Corporate Structure .............................. 1 8 1
Business ............................................................. 2 1 9
Directors and Senior Management ........................................ 3 3 7
Relationship with Our Controlling Shareholders .............................. 3 5 1
Share Capital ......................................................... 3 5 7
Substantial Shareholders ................................................ 3 6 3
Cornerstone Investors ................................................... 3 6 6
Financial Information .................................................. 3 7 4
Future Plans and Use of Proceeds ......................................... 4 6 1
Underwriting ......................................................... 4 6 5
Structure of the Global Offering .......................................... 4 7 9
How to Apply for Hong Kong Offer Shares .................................. 4 9 1
Appendix I — Accountants’ Report ..................................... I - 1
Appendix II — Unaudited Pro Forma Financial Information .................. II-1
CONTENTS
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Appendix III — Valuation Report ........................................ III-1
Appendix IV — Taxation and Foreign Exchange ............................ I V - 1
Appendix V — Summary of Principal Legal and Regulatory Provisions ......... V - 1
Appendix VI — Summary of Articles of Association ......................... V I - 1
Appendix VII — Statutory and General Information ......................... V II-1
Appendix VIII— Documents Delivered to the Registrar of Companies and
Available on Display ................................... V III-1
CONTENTS
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This summary aims to give you an overview of the information contained in this
Prospectus. As it is a summary, it does not contain all the information that may be important to
you. You should read the whole Prospectus before you decide to invest in the Offer Shares. In
particular , we are a specialist technology company seeking to list on the Main Board of the
Hong Kong Stock Exchange under Chapter 18C of the Listing Rules because we are unable to
meet the requirements under Rule 8.05 (1), (2) or (3) of the Listing Rules. There are unique
challenges, risks and uncertainties associated with investing in companies such as ours. In
addition, we have incurred operating loss since our inception, and we may incur adjusted net
loss (Non-IFRS measure) and operating loss for the foreseeable future. We had negative net
cash flow generated from operating activities during the Track Record Period. We did not
declare or pay any dividends during the Track Record Period and may not pay any dividends in
the foreseeable future. Your investment decision should be made in light of these considerations.
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” in this Prospectus. You should
read that section carefully in full before you decide to invest in the Offer Shares.
OVERVIEW
We are a provider of intelligent driving products and solutions for commercial vehicles in
China. We focus on the research and development of closed-environment autonomous driving
trucks for mining and logistics, V2X (vehicle-to-everything) technologies and intelligent
perception solutions, and offer products and solutions underpinned by proprietary technologies,
with a primary focus on intelligent driving in closed environments during the Track Record Period.
According to CIC:
 We ranked sixth among all commercial vehicle intelligent driving companies in China
(including Hong Kong, Macau and Taiwan), with a market share of approximately 5.2%.
 We delivered 56 autonomous mining trucks for a mining site in China (including Hong
Kong, Macau and Taiwan) in mixed traffic with ~500 manned trucks, the world’s largest
mixed-operation mining fleet
(1) as of the Latest Practicable Date.
 We delivered the first fully driverless electric mining fleet in China (including Hong
Kong, Macau and Taiwan).
 We ranked third in China (including Hong Kong, Macau and Taiwan)’s autonomous
mining truck solution market in terms of revenue in 2024.
Note:
(1) “Autonomous mining trucks” refers to autonomous driving trucks designed for mining operation. “Mixed-operation”
refers to scenarios involving both manned and unmanned mining trucks.
SUMMARY
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 We are among the first intelligent driving companies in China (including Hong Kong,
Macau and Taiwan) to launch commercial V2X products.
 Our train autonomous perception system (TAPS) is the only product in China (including
Hong Kong, Macau and Taiwan) capable of independent safety perception (1) for trains.
Drawing upon innovative methodology technology capabilities, we developed products and
solutions encompassing (i) autonomous driving technologies, delivering autonomous mining trucks
and offering autonomous logistics truck solutions in closed environments; (ii) V2X products and
solutions for intelligent transportation and smart cities; and (iii) intelligent perception solutions,
for rail transit and commercial vehicles.
Our pioneering closed-environment autonomous mining truck solution, METAMINE,
automates labor-intensive mining operations by integrating our proprietary algorithms with
widely-used intelligent driving hardware for commercial vehicles, enabling autonomous operation
and remote monitoring of driverless mining trucks. A challenging but critical process in
autonomous mining is deploying driverless mining trucks alongside existing human-driven vehicles
at mining sites, as it is costly and often impractical to transition to fully autonomous mining
operations within a short timeframe. Leveraging proprietary fleet management and coordination
technology, we delivered the world’s largest driverless mining fleet operating with manned
vehicles, according to CIC. Our driverless mining trucks also significantly boosted mining
efficiency to 104% of that of human-driven mining trucks
(2), as certified by the National Institute
of Metrology of China (NIM) (3) in 2022.
Our business strategy and innovative technological prowess made us a market innovator in
mass commercialization. Our initial focus on core intelligent driving functions for commercial
vehicles fortified our competitive edge. Subsequently, we expanded and tailored our offerings to
cater to more diverse and sophisticated demands, delivering unique value to customers across
sectors and forming close collaborations with strategic partners, such as leading automotive OEMs,
machinery manufacturers and energy companies. Our loyal customer base further solidifies our
technological leadership and brand influence. We served 44, 85, 131 and 152 customers as of
Notes:
(1) Without relying on existing railway signaling systems or additional track-side devices.
(2) The efficiency test compared nine of our driverless mining trucks to nine human-driven trucks (with drivers
working 8-hour shifts), all operating for 16 hours daily under otherwise the same conditions.
(3) The National Institute of Metrology, affiliated with the State Administration for Market Regulation, is China’s
highest-level research institute in measurement science and the national statutory authority in the field of
metrology.
SUMMARY
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December 31, 2022, 2023, 2024 and June 30, 2025, respectively. As of June 30, 2025, we
delivered 304 autonomous mining trucks and 110 sets of standalone autonomous truck systems,
and received indicative orders for 357 autonomous mining trucks and 290 sets of standalone
autonomous truck systems.
Our revenue increased from RMB31.1 million in 2022 to RMB410.0 million in 2024 with a
CAGR of 263.1%. Our revenue increased by 57.9% from RMB258.5 million in the six months
ended June 30, 2024 to RMB408.0 million in the six months ended June 30, 2025. Our gross profit
increased from RMB26.8 million in 2023 to RMB101.4 million in 2024. Our gross profit increased
by 57.1% from RMB44.4 million in the six months ended June 30, 2024 to RMB69.7 million in
the six months ended June 30, 2025.
The table below sets forth our revenue breakdown in absolute amounts and as percentages of
our total revenue for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Autonomous driving ......... 27,998 90.2 74,418 56.1 254,887 62.1 156,043 60.4 378,364 92.7
Closed-environment autonomous
mining trucks products and
solutions ............ 27,187 87.6 64,132 48.3 246,635 60.1 152,456 59.0 375,820 92.1
Closed-environment autonomous
logistics trucks solution ..... 811 2.6 10,286 7.8 8,252 2.0 3,587 1.4 2,544 0.6
V2X products and solutions ...... 3,058 9.8 36,812 27.8 101,591 24.8 74,237 28.7 9,179 2.3
Intelligent perception ........ — — 21,374 16.1 53,557 13.1 28,181 10.9 20,493 5.0
Total ................ 31,056 100.0 132,604 100.0 410,035 100.0 258,461 100.0 408,036 100.0
During the Track Record Period, our revenue growth was driven by increased revenue from
sales of closed-environment autonomous driving solutions, mainly due to higher sales volumes and
an expanded customer base in our closed-environment autonomous mining truck solution.
Our revenue from V2X products and solutions decreased from RMB74.2 million in the six
months ended June 30, 2024 to RMB9.2 million in the same period of 2025, primarily because (i)
the prior period recorded revenue from a national-level V2X pilot zones project, the Chongqing
V2X Project, which contributed a substantial share of revenue and did not recur in the same period
of 2025, and (ii) uncertainty regarding the implementation of industry policies and standards,
SUMMARY
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which affected potential customers’ procurement decisions and led to temporary softening of
market demand. Our revenue from intelligent perception solutions decreased from RMB28.2
million in the six months ended June 30, 2024 to RMB20.5 million in the same period of 2025,
primarily because we did not record revenue from sales of our TAPS in the six months ended June
30, 2025, mainly due to temporary fluctuations in demand from certain customers and the impact
of project acceptance cycles.
See “Financial Information — Period-to-Period Comparison of Results of Operations.”
Gross Profit/(Loss) and Gross Profit/(Loss) Margin
We recorded gross loss of RMB6.0 million in 2022 and gross profit of RMB26.8 million,
RMB101.4 million, RMB44.4 million and RMB69.7 million, in 2023, 2024 and the six months
ended June 30, 2024 and 2025, respectively. Our gross margin was -19.3%, 20.2%, 24.7% 17.2%
and 17.1% in 2022, 2023, 2024, in the six months ended June 30, 2024 and 2025, respectively. The
following table sets forth a breakdown of our gross profit/(loss) and gross profit/(loss) margin by
products and solutions for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Gross
profit/(loss)
Gross
profit/(loss)
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)
Autonomous driving ..... (7,019) (25.1) 14,526 19.5 58,887 23.1 25,139 16.1 58,978 15.6
Closed-environment
autonomous mining
products and solutions . (6,181) (22.7) 12,194 19.0 54,813 22.2 21,856 14.3 58,259 15.5
Closed-environment
autonomous logistics
truck solution ..... (838) (103.3) 2,332 22.7 4,074 49.4 3,283 91.5 719 28.3
V2X ............ 1,024 33.5 6,534 17.7 16,889 16.6 5,726 7.7 2,116 23.1
Intelligent perception .... — — 5,763 27.0 25,664 47.9 13,514 48.0 8,614 42.0
Total ........... (5,995) (19.3) 26,823 20.2 101,440 24.7 44,379 17.2 69,708 17.1
We recorded gross loss of RMB6.0 million and gross loss margin of 19.3% in 2022, mainly
attributable to (i) the gross loss in the Jurong Project, our first large-scale implementation of an
autonomous mining project with sophisticated requirements and significant manpower investment,
SUMMARY
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which incurred a gross loss in 2022 because we adopted competitive pricing to secure market
entry, and (ii) the gross loss in autonomous logistics truck solution as the gross margin of such
business was vulnerable to the gross loss of certain individual project in 2022 due to the relatively
limited business scale at initial commercialization stage. Our gross profit margin increased from
20.2% in 2023 to 24.7% in 2024, as a result of (i) the gross profit margin improvements in
autonomous driving and (ii) the commencement of intelligent perception, which has recorded
significantly higher gross profit margin since 2023.
Our gross profit margin remained relatively stable at 17.2% in the six months ended June 30,
2024 and 17.1% in the six months ended June 30, 2025. Our gross profit margin for autonomous
driving remained relatively stable at 16.1% and 15.6%, respectively, in the six months ended June
30, 2024 and 2025. Our closed-environment autonomous logistics truck solution had a relatively
high gross profit margin in the six months ended June 30, 2024, primarily because the projects
delivered in such period were predominantly based on technology and software services rather than
hardware, resulting in a relatively higher margin, which did not occur in the same period of 2025.
Our gross profit margin for V2X increased from 7.7% in the six months ended June 30, 2024 to
23.1% in the same period of 2025, primarily due to the relatively low gross profit margin from the
Chongqing V2X project in the six months ended June 30, 2024, which did not occur in the same
period in 2025. The gross margin for the six months ended June 30, 2024 and 2025 was more
susceptible to individual project impacts due to relatively smaller revenue contributions compared
to full-year operations. Our gross profit margin for intelligent perception solutions decreased from
48.0% in the six months ended June 30, 2024 to 42.0% in the same period of 2025, primarily due
to changes in our solution mix, as we did not record revenue from sales of our TAPS, which
carries a relatively higher gross margin, in the same period of 2025, mainly due to temporary
fluctuations in demand from certain customers and the impact of project acceptance cycles.
See “Financial Information — Period-to-Period Comparison of Results of Operations.”
OUR OFFERINGS
During the Track Record Period, we engaged in the sales of autonomous driving in closed
environments, V2X and intelligent perception products and solutions, all of which fall within an
acceptable sector of a Specialist Technology Industry, including Electric and Autonomous Vehicles
and Advanced Transportation Technology under Advanced Hardware and Software as defined
under Chapter 18C of the Listing Rules. We adopted a transaction-based model for our products
and solutions.
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Autonomous Driving
Our autonomous driving solutions include (i) METAMINE solution and (ii)
closed-environment autonomous logistics truck solution. Our revenue from autonomous driving
solutions increased from RMB28.0 million in 2022 to RMB254.9 million in 2024. Our revenue
from autonomous driving solutions significantly increased from RMB156.0 million in the six
months ended June 30, 2024 to RMB378.4 million in the six months ended June 30, 2025.
METAMINE — Closed-environment Autonomous Mining Truck Solution
Our closed-environment autonomous mining truck solution, METAMINE, enables
autonomous haulage and logistics and remote controlled excavation in mining sites and aims to
enable the remote operation of other mining processes such as drilling and blasting in the future.
Our METAMINE solution comprises (i) driverless mining trucks equipped with our
proprietary autonomous truck system, realizing driverless loading, haulage and unloading
processes for enhanced operational efficiency; (ii) fleet coordination module, managing loading,
haulage and unloading processes in the mining area and facilitating efficient scheduling and
collaboration among vehicles; (iii) central dispatch platform, enabling monitoring and coordination
of the entire mining operation; and (iv) teleoperation station, enabling remote operation of
excavators and other high-skill maneuvers.
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Coordination with
excavators modified with our
remote operation and V2V
communication technology
Closed-environment Autonomous Logistics Truck Solution
Our Closed-environment autonomous logistics truck solution offers similar fundamental
functionalities to our METAMINE solution such as autonomous vehicle control and
decision-making as well as coordination and planning, while adapting to specific demands of
logistics scenarios such as cargo handling requirements, navigating challenging conditions of
industrial parks and adapting to mixed traffic scenarios with pedestrians and other vehicles.
V2X
Our V2X products and solutions for intelligent transportation integrate advanced perception
technologies, sensor fusion algorithms, V2X communication capabilities and traffic optimization
algorithms to exchange information between traffic participants (including pedestrians,
non-motorized vehicles and connected vehicles) and roadside infrastructure at urban intersections
or roads. Our products and solutions not only monitor vehicle speeds, trajectories and traffic
conditions but also detect different kinds of traffic events, such as traffic accidents, illegal parking,
wrong-way driving, slow-moving vehicles and traffic congestion.
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By linking infrastructures within cities, our V2X solutions make intelligent predictions and
decisions for both urban and highway traffic. They integrate vehicles, roadside infrastructures and
cloud platforms to build robust network computing capabilities, thereby facilitating the
advancement of intelligent transportation systems and smart cities. Our solutions enhance road
safety and enable coordinated traffic perception, dynamic traffic light timing, traffic flow analysis
and congestion alerts.
Intelligent Perception
Our intelligent perception solutions include (i) the train autonomous perception system and
(ii) in-vehicle intelligent perception and safety management solution for commercial vehicles.
Train autonomous perception system (TAPS)
The rail transit industry has a need for trains to possess active perception capabilities. TAPS
is a new generation of active safety system for trains, leveraging fusion perception technology to
fully utilize the detection capabilities of LiDAR, cameras and mmWave radars, enabling train
speed measurement, positioning and active obstacle detection capabilities.
In-vehicle intelligent perception and safety management solution
Leveraging high-performance intelligent connected devices, our in-vehicle intelligent
perception and safety management solution for commercial vehicles reduces driving risks by
delivering multi-dimensional visual data through a data analysis platform. Additionally, it offers
oversight from pre-incident risk avoidance to post-incident response to enhance safety management
standards by enabling data-driven fleet and risk management in commercial fleet operation
scenarios.
Our Cooperation with Automotive OEMs
We possess the R&D capability to develop chassis for drive-by-wire-controlled vehicles,
which can be seamlessly integrated with our independently developed intelligent driving system.
Depending on project requirements (such as whether there are existing vehicle designs of
automotive OEMs on the market that meet our standards for the specific project), we collaborate
with automotive OEMs in three primary collaboration models:
 Collaboration model ①: The OEMs provide the overall vehicle design while our focus
is on the integration of intelligent driving technology. During the Track Record Period,
all autonomous mining trucks we delivered utilized this collaboration model.
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 Collaboration model ②: We jointly formulate the overall vehicle design with the OEMs.
We also provide the electrification system and software. The OEMs supply the
unpowered chassis and structural components and are responsible for vehicle assembly.
During the Track Record Period, we delivered three sets of electrification system and
software under this collaboration model.
 Collaboration model ③: We are responsible for the formulation of the overall vehicle
design under this model. We also provide designs for specific structural parts and supply
key components such as electrification systems, which include the electric motor, power
battery, electronic control system, and chassis electrical systems. Our responsibilities
also encompass commissioning, which includes functional tests and quality inspections.
The OEMs primarily take charge of the vehicle assembly process. We adopted this
collaboration model for our cabless autonomous mining trucks. As of the Latest
Practicable Date, these trucks were in the testing phase while we engaged in pre-sales
negotiations with our customers.
We are responsible for the design of intelligent driving technology, providing intelligent
driving hardware and software, offering technical guidance and conducting vehicle testing under
all three collaboration models.
SPECIALIST TECHNOLOGY INDUSTRIES
The table below sets out a summary for how each of our autonomous driving products and
solutions and intelligent imaging solutions falls within acceptable sectors of a Specialist
Technology Industry as defined under Chapter 18C of the Listing Rules:
Specialist Technology Products Specialist Technology Industry Acceptable Sectors
Autonomous Driving ....................... Electric and autonomous vehicles
V2X ................................... Advanced transportation technology
Electric and autonomous vehicles
TAPS .................................. Advanced transportation technology
In-vehicle intelligent perception and safety
management solution ......................
Electric and autonomous vehicles
Our industry consultant, CIC, confirms and our Directors are of the view that based on the
above, our Company meets the definition of a Specialist Technology Company under Chapter 18C
of the Listing Rules.
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COMMERCIALIZATION
We started to commercialize intelligent driving technology for commercial vehicles in closed
environments in 2018, and were one of the earliest among industry peers in China (including Hong
Kong, Macau and Taiwan) to do so, according to CIC. We began mass production of our V2X
products and solutions in 2019 and implemented V2X projects in five out of seven national-level
V2X pilot zones in China. We began mass production of our METAMINE and closed-environment
autonomous logistics truck solutions in 2022. As of June 30, 2025, we delivered 304 autonomous
mining trucks and 110 sets of standalone autonomous truck systems to customers. We began mass
production of our TAPS and in-vehicle intelligent perception and safety management solution in
2023 and delivered 80 units and 11,105 units, respectively, to customers as of June 30, 2025.
The following table illustrates the key commercialization timeline of our major products,
reflecting our continuous application of advanced technologies:
Specialist Technology Products Launch
Start of Revenue
Generation Mass Production
V2X products and solutions ...... March 2018 December 2018 2019
METAMINE ................. June 2020 September 2021 2022
Closed-environment autonomous
logistics truck solution ........
February 2021 September 2021 2022
TAPS ....................... March 2022 February 2023 2023
In-vehicle intelligent perception
and safety management solution .
October 2022 June 2023 2023
OUR STRENGTHS
We believe that the following strengths contribute to our current market position, ensuring
our success and distinguishing us from our competitors:
 Innovative Product-driven Provider of Autonomous Commercial Vehicle Technology
 Pioneering R&D and Comprehensive Technological Prowess
 Proven Commercial Success in Domestic Markets with Global Outlook
 Evolving Ecosystem Built with Trusted Partners along Industry Value Chain
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 Esteemed Management Fostering Homegrown Talent Pool with Product-Oriented Culture
OUR STRATEGIES
We plan to implement the following strategies to achieve our mission:
 Continually Invest in Intelligent Driving Technology and Enhance Product
Competitiveness
 Expand Sales and Form Lasting Strategic Partnerships
 Expand Overseas Presence and Market Share
 Attract and Retain Top Talent Globally
 Selectively Engage in Investments, Mergers and Strategic Partnerships
RESEARCH AND DEVELOPMENT
Our R&D team’s expertise spans across AI, computer science, robotics and vehicle
engineering, among others, enabling interdisciplinary development and application. Leveraging
comprehensive technological prowess, we developed proprietary algorithms, software, subsystems
and modules encompassing all aspects of intelligent driving, enabling us to develop
industry-leading products and solutions to boost driverless mining efficiency to 104% of that of
human-driven mining trucks certified by the NIM. As of June 30, 2025, we had a total of 249
R&D personnel, constituting 54.1% of our workforce. Our core R&D team members have an
average of more than 15 years of experience in engineering, with domestic or overseas working
experience in reputable technology companies. Our total research and development expenses
during the Track Record Period amounted to RMB545.4 million. See “Business — Research and
Development.”
INTELLECTUAL PROPERTY RIGHTS
Intellectual property rights are important to our business. As confirmed by our Directors,
during the Track Record Period and up to the Latest Practicable Date, we did not have any
instances of infringement of third parties’ intellectual property rights. As of the Latest Practicable
Date, we had 513 patent applications and 362 registered patents in the PRC, including 170
invention patents, 107 utility patents and 85 design patents. As of the same date, we also had 78
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software copyrights and 267 registered trademarks in the PRC. In addition, we had eleven
registered patents and seven trademarks overseas as of the Latest Practicable Date. See “Business
— Intellectual Property Rights.”
CUSTOMERS AND SUPPLIERS
We adopt a direct sales model and sometimes may be requested to provide customers with
various forms of financial assistance in relation to such sales. During the Track Record Period, we
provided a guarantee of RMB2.0 million for Customer Y and Customer Z, a guarantee of RMB70.0
million for the debt owed by Customer K, loans of RMB13.1 million and a deposit of RMB15.2
million for Customer K. We also granted 24-month credit terms and monthly installment payment
arrangements to Customer M and Customer P. Our major customers include mine owners and
operators, government entities and universities, commercial vehicle manufacturers, and other
corporate customers. Revenue generated from our largest customer of each of the year/period
during the Track Record Period for the years ended December 31, 2022, 2023, 2024 and the six
months ended June 30, 2025 accounted for 78.4%, 31.2%, 37.4% and 46.7%, respectively, of our
revenue during those periods. Revenue generated from our five largest customers of each of the
year/period during the Track Record Period for the years ended December 31, 2022, 2023, 2024
and the six months ended June 30, 2025 accounted for 96.7%, 64.1%, 80.0% and 94.1%,
respectively, of our revenue during those periods.
We sometimes may partner with financial leasing companies to offer alternative financing
solutions to customers who require assistance with their capital needs. See “Business — Customers
— Finance Lease Arrangements.”
Our major suppliers primarily include technology and machinery companies during the Track
Record Period. Charges from our largest supplier of each of the year/period during the Track
Record Period for our key business operations for the years ended December 31, 2022, 2023, 2024
and the six months ended June 30, 2025 accounted for 18.0%, 32.9%, 44.3% and 45.0%,
respectively, of our total purchase amount during those periods. Charges from our five largest
suppliers of each of the year/period during the Track Record Period for our key business
operations for the years ended December 31, 2022, 2023, 2024 and the six months ended June 30,
2025 accounted for 35.6%, 47.9%, 59.2% and 84.1%, respectively, of our total purchase amount
during those periods. The increase in charges from our largest supplier and five largest suppliers of
each of the year/period during the Track Record Period for our key business operations during the
Track Record Period was in line with the development of our intelligent driving business.
Suppliers of mining trucks, including our largest supplier of each of the year/period during the
Track Record Period, represented the largest proportion of our total purchase amount among our
SUMMARY
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top five suppliers of each of the year/period during the Track Record Period. The growth in the
revenue contribution from our autonomous mining products and solutions reflected our expansion
of this business segment, which led to a corresponding increase in purchases from these suppliers.
Transactions with Customer K
Founded in 2021 and registered in Anhui, Customer K primarily provides engineering
technical services and engages in the design and execution of construction projects. As a
contractor for a mining project, Customer K procured our products for its mining operations.
In 2023, we provided our METAMINE solution to Customer K for an autonomous mining
project at a large coal mine in Northwest China, with a contract value of RMB175.4 million
(inclusive of tax). We made a deposit payment of RMB15.2 million, as required by the customer,
to demonstrate our capability to fulfill contract obligations. The payment aligns with existing
commercial practice in the industry, according to CIC. In 2024, we recorded revenue of RMB152.3
million for the project. See “Business — Our Offerings — Our Major Projects.” As Customer K
purchased our solution through a finance lease arrangement, the financial leasing company
required us to provide a guarantee of RMB70.0 million for the debt owed by Customer K.
Consequently, our maximum financial exposure from this finance lease arrangement as of June 30,
2025 was RMB70.0 million. See “Business — Customers — Finance Lease Arrangements.”
Additionally, pursuant to the mine owner’s requirement for prompt commencement of
operations due to the significant demand for mining and waste transportation, we extended loans to
Customer K in 2023 and 2024 for the procurement of auxiliary equipment necessary for
transportation operations, considering it set the record for (i) the world’s largest driverless mining
fleet operating with manned vehicles, and (ii) the world’s largest mixed-operation mining fleet, as
of the Latest Practicable Date, according to CIC. According to CIC, due to the substantial
equipment and transportation requirements of large-scale mining projects, there were incidences of
suppliers providing financial support to mine operators to facilitate project execution. The total
principal amount of the loans, as well as our maximum financial exposure as of June 30, 2025,
amounted to RMB12.4 million. Due to the adverse effect of extreme rainfall since June 2024 on
safe production conditions at the mining site, the operation of the project was temporarily
suspended. Under these exceptional circumstances, we and Customer K entered into a
supplementary agreement in August 2024, pursuant to which the principal amount will be
repayable in December 2025, with interest. See “Financial Information — Discussion of Key Items
of Consolidated Statements of Financial Position — Prepayments and Other Receivables, Current
Portion.” During the Track Record Period, we did not have any similar loan arrangements with
other customers. In furtherance of our cooperation with Customer K, we provided auxiliary
infrastructure and recorded revenue of RMB1.1 million for the sales in 2024.
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As informed by the financial leasing company, since July 23, 2025, Customer K has been in
default with respect to certain payment obligations under its finance lease agreement with the
financial leasing company. To the best of our knowledge, Customer K’s default primarily resulted
from Customer K’s client being responsible for obtaining the necessary approvals for the new
mining faces, which had not been secured as of the Latest Practicable Date. Consequently,
Customer K was unable to commence mining on the new faces as initially planned and did not
achieve the expected business volume, thereby resulting in some liquidity pressure. As of the
Latest Practicable Date, the operation and production of Customer K’s autonomous mining project
on its existing mining faces continued.
The lessor asserted the corresponding liability to us on a monthly basis from July 2025.
According to the finance lease arrangements, Customer K is obligated to make monthly payments
to the lessor starting from April 2024. As informed by the lessor, Customer K has paid 15 finance
lease installments to the lessor, starting with the first installment in April 2024 as stipulated in the
contract, and continuing through June 2025. As of the Latest Practicable Date, we have fulfilled
our guarantee obligations for the months of July to October in 2025 with payments of RMB19.2
million in total, as required by the lessor and we had outstanding guarantee obligations amounting
to RMB50.8 million that have not yet been fulfilled. We may be required to assume such
obligations on a continuing monthly basis over the next eleven months. However, the specific
payment schedule is beyond our control and will be determined in accordance with the lessor’s
collection arrangements. The specific circumstances will depend on the financial condition of
Customer K, the operational performance of its projects, and the results of subsequent discussions
with the lessor. As of the Latest Practicable Date, Customer K did not make any payment to us.
We are also actively pursuing collection from Customer K and have issued a demand letter, while
continuing to engage with the Customer K to seek the resolution of the outstanding balance.
As of June 30, 2025, the amount of impairment losses made in respect of transactions with
Customer K was RMB70.6 million, representing an impairment ratio of 71.8% for the financial
guarantee contract liabilities and other receivables arising from Customer K. As of June 30, 2025,
we have not recognized a full impairment loss in respect of the other receivables and financial
guarantee contract exposure related to Customer K. This is primarily because, as of the Latest
Practicable Date, the operation and production of Customer K’s autonomous mining project on its
existing mining faces continued. Furthermore, as Customer K is not subject to any bankruptcy or
insolvency proceedings, we do not assess its current default to be permanent. Therefore, we
consider that there is recoverable value in this exposure, and we have not made a full provision for
impairment loss and we consider the provision for impairment for other receivables and financial
guarantees related to Customer K to be sufficient. See “Business — Customers — Major
Customers — Transactions with Customer K.”
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Given that (i) as of June 30, 2025, we have recognized relevant impairment losses to reflect
the relevant risk, (ii) we maintain sufficient liquidity reserves for ongoing operations, and (iii) our
business model and revenue streams are diversified across multiple customers and projects, and we
are also actively working to diversify our customer base further, reducing reliance on any single
customer, we believe the aforementioned default does not have a material adverse impact on our
business, financial condition, results of operations or liquidity. Meanwhile, apart from the
aforementioned agreements, including the sales agreement, the deposit agreement, the loan
agreement and finance guarantee agreement, we have no other contractual arrangements with
Customer K. Accordingly, we do not expect that we will be subject to any additional legal or
financial liabilities in connection with the sales to Customer K.
COMPETITIVE LANDSCAPE
China (including Hong Kong, Macau and Taiwan)’s commercial vehicle intelligent driving
market is relatively fragmented. Intelligent driving commercial vehicles have been deployed in
various scenarios, which can be categorized into three main types: urban roads, intercity roads and
closed environments. Urban roads are characterized by high traffic density and more unpredictable
road conditions, which makes intelligent driving in urban roads demand more advanced perception
technologies and sophisticated algorithms capable of handling these unstructured scenarios. At the
same time, regulatory frameworks in urban settings are typically fragmented due to the
involvement of multiple stakeholders. The deployment of intelligent driving on intercity roads is
relatively more viable, owing to more structured traffic conditions, higher yet more predictable
vehicle speeds and limited interactions with minimal involvement of pedestrians or complex
intersections. Although regulatory constraints on vehicle automation levels still persist, the higher
degree of scenario standardization has facilitated consistent policy support, with large-scale pilot
programs and commercial rollouts in intercity logistics steadily progressing. Closed environments
are among the most promising scenarios for the early development of intelligent driving. Closed
environments offer clearly defined operational boundaries, planned routes, simplified traffic
conditions and a high degree of environmental controllability, all of which contribute to greater
intelligent driving solutions stability and ultimately improved operational efficiency. The
regulatory landscape in closed environments is supportive of intelligent driving technologies,
providing a favorable policy environment for future deployment.
We primarily compete with existing companies and new entrants in the autonomous mining in
closed environments, V2X and intelligent perception sectors. As intelligent driving remains in the
early stages of commercialization across various application scenarios, most market players are
focused on deepening their capabilities within their respective domains. Although closed
environments are ideal for the early testing and deployment of intelligent driving technology,
transitioning to the commercial vehicle intelligent driving market presents significant challenges
for companies originally focused on passenger vehicles. Commercial vehicle intelligent driving
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requires more sensor strategies, stricter motion control validation, and robust reliability under
harsh operating conditions. See “Industry Overview.” Although we believe that we have
market-leading technology, we may face competition from a range of companies which may
possess more resources and skills in design, development, manufacturing and sales. See “Risk
Factors — Risks Relating to Our General Operations — The industries that we operate in are
highly competitive. If we fail to compete with our competitors, our business, results of operations
and financial condition may be materially and adversely affected.”
According to CIC, we ranked sixth among all commercial vehicle intelligent driving
companies in China (including Hong Kong, Macau and Taiwan), with a market share of
approximately 5.2%. We were the third largest autonomous mining technology company in China
(including Hong Kong, Macau and Taiwan) in terms of revenue in 2024. Our market share in the
autonomous mining truck solution market in terms of revenue was 12.9% in 2024.
We believe that we are strategically well-positioned in our market, and we compete favorably
with others based on our comprehensive technological prowess, advanced in-house R&D
capabilities, strong ecosystem partnerships and commercialization capabilities to attract and retain
customers and expand our market share.
See “Industry Overview.”
RISK FACTORS
Our business and the Global Offering involve certain risks as set out in “Risk Factors” in this
prospectus. You should read that section in its entirety carefully before you decide to invest in our
Shares. We believe the most significant risks we face include but are not limited to the following:
 If we are unable to develop new products and solutions that adapt to changing market
demand and customer needs in a cost-effective and timely manner, our future business,
results of operations, financial condition and competitive position would be materially
and adversely affected.
 We have been and intend to continue investing significantly in R&D, which may
adversely affect our profitability and operating cash flow and may not generate the
results we expect to achieve.
 Intelligent driving is an emerging technology, and we face significant technical
challenges to develop and commercialize our technology.
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 We have a limited track record in commercialization in a new and rapidly evolving
industry and there can be no assurance that our sales and marketing efforts will succeed.
 Dependency on third-party suppliers to manufacture, assemble and test our products
reduces our control over product quantity and quality, and could harm our business.
 We may not be able to obtain or maintain adequate intellectual property rights
protection for our product and solution, or the scope of such intellectual property rights
protection may not be sufficiently broad.
 We may not be able to obtain additional capital when desired, on favorable terms or at
all.
 The industries that we operate in are highly competitive and concentrated. In particular,
China’s autonomous mining truck solution market is highly concentrated, with top five
players accounting for 97% of the market share in terms of revenue in 2024. If we fail
to compete with our competitors, our business, results of operations and financial
condition may be materially and adversely affected.
 We may be subject to risks associated with international trade policies, geopolitics and
trade protection measures, including imposition of trade restrictions and sanctions, and
our reputation, business, results of operations and financial condition could be adversely
affected.
See “Risk Factors.”
OUR CONTROLLING SHAREHOLDERS
Prof. Li is entitled to exercise 43.64% of the voting rights in our Company as of the Latest
Practicable Date and 38.25% of the voting rights in our Company immediately following the
completion of the Global Offering (assuming the Over-allotment Option is not exercised) through
its direct or indirect interests in NovoDriv HK, NovoDriv Limited, Changsha Gangwan, Dongguan
Intelligence, CWB Startup HK, Clear Water Bay Startup Fund GP, Clear Water Bay Startup Fund
LP, Changsha Shengyu and Dongguan Yunhe. Accordingly, Prof. Li, NovoDriv HK, NovoDriv
Limited, Changsha Gangwan, Dongguan Intelligence, CWB Startup HK, Clear Water Bay Startup
Fund GP, Clear Water Bay Startup Fund LP, Changsha Shengyu and Dongguan Yunhe constitute a
group of Controlling Shareholders of the Company. See “Relationship with our Controlling
Shareholders”.
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PRE-IPO INVESTMENTS
Since the inception of our Group and up to the Latest Practicable Date, we have conducted
eight rounds of Pre-IPO Investments raising funds of approximately RMB1,492 million in total.
Our Pre-IPO Investors (excluding CWB Startup HK and Changsha Shengyu) hold approximately
56.36% of the voting rights in our Company as of the Latest Practicable Date. In particular, we
have received meaningful investment from Sophisticated Independent Investors (including our
Pathfinder SIIs, HongShan, Xinding Capital and Legend Holdings), holding in aggregate
approximately 26.04% in the voting rights of our Company as of the Latest Practicable Date. See
“History and Corporate Structure — Pre-IPO Investments.”
SUMMARY OF HISTORICAL FINANCIAL INFORMATION
The following tables set forth summary financial data from our consolidated financial
information for the Track Record Period, derived from the Accountant’s Report set out in
Appendix I. The summary consolidated financial data set forth below should be read together with
the consolidated financial statements in this prospectus, including the related notes. Our
consolidated financial information was prepared in accordance with IFRS.
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Selected Items from the Consolidated Statements of Profit or Loss
The following table sets forth selected items from our consolidated statements of profit or
loss for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount
%o f
revenue Amount
%o f
revenue Amount
%o f
revenue Amount
%o f
revenue Amount
%o f
revenue
(RMB in thousands, except for percentage)
(unaudited)
Revenue .......... 31,056 100.0 132,604 100.0 410,035 100.0 258,461 100.0 408,036 100.0
Cost of sales ........ (37,051) (119.3) (105,781) (79.8) (308,595) (75.3) (214,082) (82.8) (338,328) (82.9)
Gross profit/(loss) ..... (5,995) (19.3) 26,823 20.2 101,440 24.7 44,379 17.2 69,708 17.1
Other income ........ 7,406 23.8 11,199 8.4 7,455 1.8 5,798 2.2 861 0.2
Other gains/(losses), net ... 115 0.4 801 0.6 (19) (0.0) (102) 0.0 401 0.1
Impairment losses ..... (5,092) (16.4) 3,589 2.7 (29,038) (7.1) (5,280) (2.0) (84,280) (20.7)
Selling expenses ...... (23,148) (74.5) (31,404) (23.7) (64,439) (15.7) (23,611) (9.1) (44,288) (10.9)
General and administrative
expenses ........ (68,969) (222.1) (97,827) (73.8) (300,721) (73.3) (56,070) (21.7) (199,678) (48.9)
Research and development
expenses ........ (110,507) (355.8) (90,396) (68.2) (193,181) (47.1) (35,339) (13.7) (151,317) (37.1)
Finance costs — net ..... (96,684) (311.3) (112,921) (85.2) (130,653) (31.9) (63,246) (24.5) (71,252) (17.5)
Loss before income tax .. (302,874) (975.3) (290,136) (218.8) (609,156) (148.6) (133,471) (51.6) (479,845) (117.6)
Income tax credit ...... 39,877 128.4 35,057 26.4 28,312 6.9 10,904 4.2 24,759 6.1
Loss for the year/period .. (262,997) (846.8) (255,079) (192.4) (580,844) (141.7) (122,567) (47.4) (455,086) (111.5)
Non-IFRS Financial Measure
To supplement our consolidated financial statements, which are presented in accordance with
IFRS, we also use adjusted net loss (Non-IFRS Measure) as an additional financial measure, which
is not required by, or presented in accordance with IFRS. We believe this non-IFRS measure
facilitates comparisons of operating performance from year to year and 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 combined results of operations in the
same manner as they help our management. However, such non-IFRS financial measure that 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 substitute for analysis of our results of
operations or financial condition as reported under IFRS.
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We define adjusted net loss (Non-IFRS Measure) for the year/period as net loss for the
year/period adjusted by adding back (i) share-based payments, (ii) financial cost on financial
instruments with preferred rights at amortized cost, and (iii) listing expenses. The following table
reconciles our adjusted net loss (Non-IFRS Measure) for the year/period presented in accordance
with IFRS, which is net loss for the periods:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Net loss for the year/period ........... (262,997) (255,079) (580,844) (122,567) (455,086)
Add:
— Share-based payments (1) .......... — — 313,500 — 266,822
— Financial cost on financial instruments
with preferred rights at amortized
cost
(2) .................... 104,136 117,528 128,593 63,119 67,923
— Listing expenses (3) ............. — — 11,896 — 9,379
Adjusted net loss (Non-IFRS Measure) for
the year/period ................. (158,861) (137,551) (126,855) (59,448) (110,962)
Notes:
(1) Share-based payments relate to the non-cash employee benefit expenses incurred in connection with our award to
management and key employees.
(2) Financial cost on financial instruments with preferred rights at amortized cost was in relation to financial
instruments with preferred rights in connection with our issuance of ordinary shares to pre-IPO investors that
conferred the redemption rights. The financial instruments with preferred rights are recognized as financial liability
initially measured at fair value (representing the present value of the redemption amount) and subsequently
measured at amortized cost with interest charged in finance costs. The financial cost on financial instruments with
preferred rights at amortized cost is considered a non-cash item. The financial instruments with preferred rights at
amortized cost will be re-designated from liabilities to equity as a result of the automatic conversion into ordinary
shares upon Listing.
(3) Listing expenses represent professional fees, underwriting commissions and other fees incurred in connection with
the Global Offering.
SUMMARY
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Our gross margins have shown consistent improvement from 2022 to 2024, and remained
relatively stable at 17.2% and 17.1% in the six months ended June 30, 2024 and 2025,
respectively. We recorded a gross loss in 2022, primarily due to the gross loss in the Jurong
Project, our first large-scale implementation of an autonomous mining project with sophisticated
requirements and significant manpower investment, which incurred a gross loss in 2022 because
we adopted competitive pricing to secure market entry. See “Financial Information —
Period-to-Period Comparison of Results of Operations.”
We had a net loss of RMB263.0 million, RMB255.1 million, RMB580.8 million, RMB122.6
million and RMB455.1 million in 2022, 2023, 2024 and the six months ended June 30, 2024 and
2025, respectively, primarily due to (i) our continuous investment in research and development, (ii)
continuous increase in net finance costs mainly resulting from financial cost on financial
instruments with preferred rights at amortized cost in relation to our Pre-IPO investments, and (iii)
share-based payments incurred in relation to our Share Incentive Scheme adopted and approved on
September 23, 2024, which amounted to RMB313.5 million in 2024 and RMB266.8 million for the
six months ended June 30, 2025. Apart from the three reasons mentioned above, the increase in
our net loss from RMB122.6 million in the six months ended June 30, 2024 to RMB455.1 million
in the same period of 2025 is also attributable to higher impairment losses, primarily from (i)
impairment losses of RMB56.9 million
(1) related to financial guarantee contract liabilities and
other receivables arising from Customer K’s default under its finance lease agreement, and (ii)
impairment losses of RMB26.2 million related to trade and notes receivables, mainly due to (a)
revenue growth, which led to an increase in trade and notes receivable balances, and (b) the aging
of trade receivables from Customer L, which resulted in an impairment loss of RMB5.8 million.
Correspondingly, our adjusted net loss (Non-IFRS Measure) increased from RMB59.4 million in
the six months ended June 30, 2024 to RMB111.0 million in the same period of 2025. See
“Business — Customers — Major Customers — Transactions with Customer K” and “Financial
Information — Discussion of Key Items of Consolidated Statements of Financial Position — Net
Current Assets — Trade and Notes Receivables, Current Portion.”
Note:
(1) The impairment losses of RMB56.9 million arising from Customer K are higher than our total impairment amount
recognized for financial guarantee contract liabilities and other receivables in the six months ended June 30, 2025,
primarily because certain impairment losses were partially reversed.
SUMMARY
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--- page 32 ---
Selected Items from the Consolidated Statements of Financial Position
The following table sets forth selected items from our consolidated statements of financial
position as of the dates indicated:
As of December 31,
As of
June 30,
2022 2023 2024 2025
(RMB in thousands)
Current assets
Inventories ........................... 123,465 174,227 96,544 170,521
Trade and notes receivables .............. 30,772 58,680 137,360 417,946
Prepayments and other receivables ......... 56,082 90,426 117,920 160,724
Contract assets ........................ 2,887 9,834 12,251 20,286
Financial assets at fair value through profit or
loss (“ FVTPL ”) ..................... 30,130 — 10,005 —
Financial assets at fair value through other
comprehensive income (“ FVTOCI ”) ...... 395 9,799 290 18,543
Income tax recoverable .................. 3 458 454 498
Restricted bank deposits ................. 27,806 27,819 10,481 22,105
Term deposits ......................... — 147,411 5,328 5,402
Cash and cash equivalents ............... 381,678 234,663 306,402 186,225
Total current assets ................... 653,218 753,317 697,035 1,002,250
Current liabilities
Trade and notes payables ................ 41,530 70,689 63,299 377,708
Contract liabilities ...................... 46,757 86,124 42,011 49,314
Borrowings .......................... 44,606 123,834 153,842 230,884
Lease liabilities ....................... 4,566 2,980 3,661 5,937
Other payables and accruals .............. 76,728 106,465 101,707 133,831
Income tax payables .................... —92 —
Provision ............................ 1,938 4,743 17,735 35,217
Financial instruments with preferred rights at
amortised cost ....................... — — — 1,962,541
Total current liabilities ................. 216,125 394,844 382,257 2,795,432
Net current assets/(liabilities) ............ 437,093 358,473 314,778 (1,793,182)
SUMMARY
–2 2–


--- page 33 ---
As of December 31,
As of
June 30,
2022 2023 2024 2025
(RMB in thousands)
Non-current assets
Property, plant and equipment ............. 331,756 332,792 309,612 297,313
Right-of-use assets ..................... 44,497 42,683 41,093 43,020
Intangible assets ....................... 2,575 2,292 1,756 1,942
Deferred tax assets .................... 117,252 152,318 180,653 205,423
Prepayments and other receivables ......... 3,881 17,486 10,542 11,230
Term deposits ......................... 190,101 5,177 — —
Trade receivables ...................... — — — 39,880
Financial assets at FVTPL ............... 525 2,116 2,541 3,398
Total non-current assets ................ 690,587 554,864 546,197 602,206
Non-current liabilities
Financial instruments with preferred rights at
amortized cost ...................... 1,625,922 1,766,025 1,894,618 —
Total non-current liabilities ............. 1,729,597 1,770,333 1,978,850 115,231
Net liabilities ........................ 601,917 856,996 1,117,875 1,306,207
Our net liabilities increased from RMB601.9 million as of December 31, 2022 to RMB857.0
million as of December 31, 2023, primarily due to (i) loss for the year of RMB255.1 million in
2023, and (ii) the effect of financial instruments with preferred rights at amortized cost of
RMB24.0 million in 2023, partially offset by the capital contributions from the equity holders of
the Company of RMB24.0 million. Our net liabilities increased from RMB857.0 million as of
December 31, 2023 to RMB1,117.9 million as of December 31, 2024, primarily due to loss for the
year of RMB580.8 million in 2024, partially offset by share-based payments of RMB313.5 million.
Our net liabilities remained relatively stable at RMB1,117.9 million as of December 31, 2024 and
RMB1,306.2 million as of June 30, 2025. We expect to turn into net asset position upon Listing,
taking into account the re-designation of the financial instruments with preferred rights at
amortized cost with carrying amount of RMB1,962.5 million as of June 30, 2025 from liabilities to
equity as a result of the automatic conversion into ordinary Shares.
Our net current assets decreased by 18.0% from RMB437.1 million as of December 31, 2022
to RMB358.5 million as of December 31, 2023, primarily due to (i) a decrease in cash and cash
equivalents, (ii) an increase in borrowings, and (iii) an increase in contract liabilities, partially
offset by an increase in prepayments and other receivables. Our net current assets decreased by
12.2% from RMB358.5 million as of December 31, 2023 to RMB314.8 million as of December 31,
2024, primarily due to (i) a decrease in inventory, and (ii) an increase in borrowings, partially
offset by (i) an increase in trade and notes receivables, (ii) an increase in cash and cash
equivalents, and (iii) a decrease in contract liabilities. We recorded net current liabilities of
SUMMARY
–2 3–


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RMB1,793.2 million as of June 30, 2025 compared with net current assets of RMB314.8 million as
of December 31, 2024, primarily due to (i) the reclassification of financial instruments with
preferred rights at amortised cost of RMB1,962.5 million from non-current liabilities to current
liabilities in relation to our Series A financing to Series C+ financing, (ii) a decrease in cash and
cash equivalents, and (iii) increases in trade and notes payables and borrowings, partially offset by
an increase in trade and notes receivables. Our trade and notes receivables increased from
RMB137.4 million as of December 31, 2024 to RMB417.9 million as of June 30, 2025, primarily
due to (i) an increase in sales of autonomous mining products and solutions, mainly reflecting the
concentrated revenue recognition from three large-scale autonomous mining truck projects
involving Customers M, N and O in the second quarter of 2025, with trade receivables amounting
to RMB151.0 million, RMB85.4 million, and RMB40.1 million, respectively, and (ii) the 24-month
credit term and monthly installment payment arrangement with Customer M and Customer P. Our
trade and notes payables significantly increased from RMB63.3 million as of December 31, 2024
to RMB377.7 million as of June 30, 2025, primarily due to (i) an increase in our procurement of
mining trucks from Supplier F and L, with trade payable amounting to approximately RMB164.8
million and RMB98.9 million, respectively, as we expanded our business scale and supported the
aforementioned three large-scale autonomous mining truck projects, (ii) the collection progress of
receivables from these three projects as payments to suppliers are generally made after the
corresponding customer payments have been received, and (iii) the 18-month credit term and
monthly installment payment arrangement with Supplier L.
See “Financial Information — Discussion of Key Items of Consolidated Statements of
Financial Position — Net Current Assets” and “History, Development and Corporate Structure —
Pre-IPO Investments.”
Selected Items from the Consolidated Statements of Cash Flow
The following table sets forth a summary of our cash flows for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Net cash used in operating activities ........ (203,053) (196,761) (147,735) (42,481) (208,210)
Net cash generated from/(used in) investing
activities ........................ (302,384) 58,972 125,122 104,878 7,654
Net cash generated from/(used in) financing
activities ........................ 386,326 (9,226) 94,325 34,919 80,401
Cash and cash equivalents at beginning of
year/period ...................... 500,789 381,678 234,663 234,663 306,402
Cash and cash equivalents at end of
year/period ...................... 381,678 234,663 306,402 331,979 186,225
SUMMARY
–2 4–


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We had net operating cash outflow of RMB203.1 million, RMB196.8 million, RMB147.7
million, RMB42.5 million and RMB208.2 million in 2022, 2023, 2024 and the six months ended
June 30, 2024 and 2025, respectively, primarily due to our losses before income tax as we incurred
significant R&D expenses and general and administrative expenses. See “Financial Information —
Liquidity and Capital Resources — Net Cash Flows Used in Operating Activities.”
Our cash burn rate refers to the average monthly (i) net cash used in operating activities, (ii)
purchase of property, plant and equipment, (iii) purchase of intangible assets, (iv) repayment of
lease liabilities, (v) interest paid on lease liabilities, and (vi) interest paid on bank borrowings. Our
historical cash burn rate was RMB30.6 million, RMB20.1 million, RMB13.5 million and RMB36.2
million in 2022, 2023, 2024 and the six months ended June 30, 2025, respectively, mainly
representing our investment in R&D activities. In 2021 and 2022, we recorded significant capital
expenditure in purchase of property, plant and equipment, primarily due to the construction of our
industrial park during these years, which was substantially completed by the end of 2022. The
relatively higher cash burn rate in the six months ended June 30, 2025 was primarily attributable
to (i) the comparatively lower cash burn rate in 2024, which mainly resulted from payments
received in 2024 for the project carried out in collaboration with Customer K, and (ii) increased
operating cash outflows driven by the expansion of our business scale, including the increase in
inventories due to the increased number of ongoing orders and larger order sizes for autonomous
mining products and solutions.
We had (i) cash and cash equivalents of RMB101.1 million, (ii) committed unutilized bank
facilities of RMB460.0 million, and (iii) financial assets at FVTPL, term deposits and restricted
bank deposits of RMB30.8 million as of October 31, 2025. We estimate that we will receive net
proceeds of approximately HK$1,309.0 million after deducting the underwriting fees and expenses
payable by us in the Global Offering, assuming that the Over-allotment Option is not exercised.
Assuming that the average cash burn rate going forward will be similar to the cash burn rate level
in the six months ended June 30, 2025, based on the underlying assumptions that (i) the number of
our employees will not increase significantly, particularly in the R&D department, (ii) we do not
expect substantial capital investment, and (iii) we do not expect significant acquisitions of fixed
assets, we estimate that our cash and cash equivalents, financial assets at FVTPL, term deposits,
restricted bank deposits and committed unutilized bank facilities totaling RMB591.9 million as of
October 31, 2025 will be able to maintain our financial viability for 16 months from October 31,
2025 to February 28, 2027 or, if we take into account 10% of the estimated net proceeds from the
Listing (namely, the portion allocated for our working capital and other general corporate
purposes) together with the foregoing liquidity resources totaling RMB710.9 million, 20 months
from October 31, 2025 to June 30, 2027 or, if we also take into account the estimated net proceeds
from the Listing together with the foregoing liquidity resources totaling RMB1,781.6 million, 49
months from October 31, 2025 to November 30, 2029. We will continue to monitor our cash flows
from operations closely and maintain our financial viability through a variety of means, including,
among others, banking facilities and external financings.
SUMMARY
–2 5–


--- page 36 ---
Cash Conversion Cycle Analysis
Our cash conversion cycle, a metric to measure how efficiently we manage our working
capital by tracking the number of days we take to convert our investments in inventory and other
resources into cash flows from sales, was 933.0 days, 495.2 days, 188.2 days and 78.6 days in
2022, 2023, 2024 and the six months ended June 30, 2025, respectively. The cash conversion cycle
is calculated by adding inventory turnover days and trade receivables turnover days, then
subtracting trade payables turnover days.
Our cash conversion cycle has shown a significant improvement over the Track Record
Period, decreasing from 933.0 days in 2022 to 78.6 days in the six months ended June 30, 2025.
The improvement during the Track Record Period was primarily attributable to the fact that the
decrease in our inventory turnover days and trade receivables turnover days far exceeded the
decrease in trade payables turnover days, particularly the substantial decrease in inventory
turnover days.
The improvement of cash conversion cycle reflects our enhanced operational efficiency and
improved working capital management. However, the cash conversion cycle in the six months
ended June 30, 2025 remains relatively prolonged. A prolonged cash conversion cycle can increase
working capital requirements and pressure liquidity, particularly during periods of rapid growth or
large-scale project execution. While we have mitigated these risks through the following prudent
working capital management policies:
(i) we proactively negotiate with customers and suppliers to optimize credit terms. For
example, we negotiate with suppliers to settle payments only after receiving payments
from customers for certain projects, thereby effectively alleviating cash flow pressure;
or the installment payment arrangements between our major customers and suppliers are
generally aligned in both timing and amount, ensuring that monthly cash inflows are
sufficient to cover corresponding cash outflows;
(ii) for large-scale projects, we plan funding in advance and coordinate the use of available
committed unutilized bank facilities to ensure smooth project execution;
(iii) we conduct regular monthly monitoring of the aging and balances of our receivables and
payables, as well as inventory levels, to enable timely adjustments to our business
operation strategies; and
(iv) we utilize diversified funding channels, and in addition to cash inflows from operations,
we also maintain strong banking credit lines to support working capital needs.
SUMMARY
–2 6–


--- page 37 ---
In the six months ended June 30, 2025, we granted 24-month credit terms and monthly
installment payment arrangements to Customer M and Customer P, primarily because these
customers, as well-known local mining operators, have strong bargaining power. Such credit terms
and installment arrangements for these strategic customers help us strengthen customer
relationships and secure long-term or large-scale contracts in a competitive market.
Going forward, we still plan to primarily adopt payment arrangements that require stage
payment or bullet payment within a relatively short credit period. However, we will also conduct
prudent assessments of potential customers who require monthly installment payments and long
credit terms, including their credit status, the operational status of their existing projects, and their
financial condition. At the same time, even when we provide certain customers with long credit
periods and monthly installment payment arrangements, we also negotiate with suppliers to adopt
similar credit periods and installment arrangements, in order to avoid cash flow mismatches and
reduce our liquidity pressure.
Business Sustainability
We have experienced robust business growth during the Track Record Period. As we have
been focusing on growing our customer base via developing our proprietary technologies and
commercializing such technologies into our product and solution offerings rather than seeking
immediate financial returns or profitability, we laid a solid foundation for long-term sustainability.
Despite our continued increase in customer base, we may continue to incur net losses and net
operating cash outflow in the foreseeable future.
During the Track Record Period, we engaged in the offering of autonomous driving solutions
in closed environments, V2X products and solutions and intelligent perception solutions, all of
which are designated Specialist Technology Products as defined under Chapter 18C of the Listing
Rules. Our revenues increased from RMB31.1 million in 2022 to RMB410.0 million in 2024 with
a CAGR of 263.1%. Our revenue increased by 57.9% from RMB258.5 million in the six months
ended June 30, 2024 to RMB408.0 million in the six months ended June 30, 2025. Benefiting from
the solid foundation we have built and the momentum we have seized, we believe that we are able
to maintain sustainability and growth of our business. See “Business — Business Sustainability.”
Our Directors believe our extensive R&D and ability to identify latent customer needs and
leverage comprehensive technological capabilities to develop high-value products for the optimal
product-market fit have laid a solid foundation for long-term development and business
sustainability. As of June 30, 2025, we delivered 304 autonomous mining trucks and 110 sets of
standalone autonomous truck systems to customers. Our strong track record of delivering
pioneering, large-scale projects such as the delivery of 56 autonomous mining trucks for the
world’s largest mixed-operation mining fleet has strengthened our reputation and earned substantial
additional customer orders. Our total order backlog value reached approximately RMB583.9
SUMMARY
–2 7–


--- page 38 ---
million as of June 30, 2025 and we received indicative orders for 357 autonomous mining trucks
and 290 sets of standalone autonomous truck systems as of the same date, a strong indication of
revenue growth as we begin to deliver for these customer orders.
Key Financial Ratios
The following table sets forth our key financial ratios for the periods indicated:
As of/For the year ended December 31,
As of/For the six
months ended
June 30,
2022 2023 2024 2025
Gross profit/(loss) margin (%) (1) ............ (19.3) 20.2 24.7 17.1
Adjusted net loss margin (Non-IFRS Measure)
(%)(2) ........................... (511.5) (103.7) (30.9) (27.2)
Current ratio (3) ....................... 3.0 1.9 1.8 0.4
Quick ratio (4) ........................ 2.5 1.5 1.6 0.3
Cash ratio (5) ........................ 1.9 0.6 0.8 0.1
Notes:
(1) Gross profit/(loss) margin equals gross profit/(loss) divided by revenue and multiplied by 100%.
(2) Adjusted net loss margin (Non-IFRS Measure) equals adjusted net loss margin (Non-IFRS Measure) for the period
divided by revenue for the period and multiplied by 100%. The use of the non-IFRS measure has limitations as an
analytical tool, and you should not consider it in isolation from, or as a substitute for or superior to, the analysis of
our results of operations or financial condition as reported under the IFRS.
(3) Current ratio equals current assets divided by current liabilities as of the same date.
(4) Quick ratio equals current assets less inventories divided by current liabilities as of the same date.
(5) Cash ratio equals the sum of cash and cash equivalents and financial assets at FVTPL recorded as current assets
divided by the total current liabilities as of the same date.
GLOBAL OFFERING STATISTICS
The statistics in the following table are based on the assumption that (i) the Global Offering
has been completed and 5,407,980 H Shares are issued pursuant to the Global Offering and (ii) the
Over-allotment Option is not exercised.
SUMMARY
–2 8–


--- page 39 ---
Based on an Offer Price of
HK$263.00 per H Share
Market capitalization of our H Shares (1) ................................ HK$11,162.74 million
Market capitalization of our Shares (2) .................................. HK$11,516.59 million
Unaudited pro forma adjusted consolidated net tangible assets per Share (3) ........... HK$46.89
Notes:
(1) The calculation of market capitalization is based on the 42,443,892 H Shares expected to be in issue immediately
upon completion of the Global Offering.
(2) The calculation of market capitalization is based on the 43,789,310 Shares expected to be in issue immediately
upon completion of the Global Offering.
(3) The unaudited pro forma adjusted consolidated net tangible assets per share is arrived at after making the
adjustments referred to in Appendix II to this prospectus.
(4) No adjustment has been made to reflect any trading results or other transactions of the Group entered into
subsequent to June 30, 2025.
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 RMB103.0 million (assuming no exercise of the Over-allotment Option),
representing 8.0% of the gross proceeds (assuming that the Over-allotment Option is not exercised)
of the Global Offering. During the Track Record Period, we incurred listing expenses of RMB24.9
million, of which RMB21.3 million was charged to the consolidated statements of profit or loss as
general and administrative expenses and RMB3.6 million will be deducted from equity. We expect
to incur listing expenses of approximately RMB103.0 million, of which approximately RMB45.0
million is expected to be recognized in the consolidated statements of profit or loss as general
administrative expenses and approximately RMB58.0 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 comprised
of (i) underwriting related expenses of approximately RMB51.7 million, and (ii) non-underwriting
related expenses of approximately RMB51.2 million, which consist of fees and expenses of legal
advisors and Reporting Accountant of approximately RMB27.2 million and other fees and
expenses of approximately RMB24.0 million.
SUMMARY
–2 9–


--- page 40 ---
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, we estimate that we will receive net proceeds of approximately HK$1,309.0 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 55% of the net proceeds, or HK$720.0 million, will be used for our
research and development in the next five years.
 Approximately 15% of the net proceeds, or HK$196.4 million, will be used for
improvement of our commercialization capabilities in China and overseas and further
strengthening our cooperation with domestic and global customers.
 Approximately 20% of the net proceeds, or HK$261.8 million, will be used for potential
investment, and merger and acquisition opportunities aimed at further integrating
upstream and downstream resources in the industrial chain.
 Approximately 10% of the net proceeds, or HK$130.9 million, will be employed as
working capital and for general corporate uses.
See “Future Plans and Use of Proceeds.”
DIVIDENDS
No dividend was paid or declared by our Company or other entities comprising our Group
during the Track Record Period and as of the date of this prospectus. Any declaration and
payment, as well as the amount of dividends, will be subject to our Articles of Association and the
relevant PRC laws. We currently do not have any dividend policy or fixed dividend pay-out ratio.
No dividend shall be declared or payable except out of our profits and reserves lawfully available
for distribution. As confirmed by our PRC Legal Advisor, according to relevant PRC laws, any
future net profit that we make will have to be first applied to make up for our historically
accumulated losses, after which we will be obliged to allocate 10% of our net profit to our
statutory common reserve fund until such fund has reached more than 50% of our registered
capital. We will, therefore, only be able to declare dividends after: (i) all our historically
accumulated losses have been made up for; and (ii) we have allocated sufficient net profit to our
statutory common reserve fund as described above.
SUMMARY
–3 0–


--- page 41 ---
IMPACT OF COVID-19
Since the end of December 2019, the COVID-19 pandemic has materially and adversely
affected the global economy. In response, countries and regions worldwide, including mainland
China, imposed various measures to contain the virus’s spread, such as social distancing, travel
restrictions, quarantine, and remote work, among others.
The pandemic’s recurrence temporarily disrupted our business, operational results and
financial condition. In 2022, the mobility of some employees was affected, and certain employees
had to work remotely. Additionally, pandemic-related restrictions slowed the implementation
schedule of some projects, the acceptance of which was also delayed. We undertook several
measures to mitigate the impact on our operations and performance, including temporarily closing
our offices and providing remote work arrangements and support for R&D activities.
As the COVID-19 pandemic has subsided since early 2023, our business operations have
resumed normalcy. Save for the above, our Directors are of the view that COVID-19 did not have
any material adverse impact on our business during the Track Record Period and up to the Latest
Practicable Date.
RECENT DEVELOPMENT AND NO MATERIAL ADVERSE CHANGE
Our business footprint continued to expand subsequent to the Track Record Period. After the
Track Record Period and up to September 30, 2025, we recorded backlog for 121 autonomous
truck systems with a total contract value of approximately RMB67.2 million. During the same
period, we delivered 71 autonomous truck systems and 35 autonomous trucks, indicating strong
potential for revenue growth. In addition, we secured 14 new customers, further demonstrating our
ability to continuously expand our customer base. As of September 30, 2025, our total order
backlog amounted to approximately RMB471.3 million, with 109 orders in hand.
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 June 30, 2025
(being the date of our latest audited financial statements) and there has been no event since June
30, 2025, which would materially affect the information shown in the Accountant’s Report set out
in Appendix I to this prospectus.
We expect to record a substantial increase in net loss for the year ending December 31, 2025,
primarily due to (i) share-based payments made to recognize employee contributions and to attract
and retain talent, and (ii) higher impairment losses, primarily from impairment losses related to
financial guarantee contract liabilities and other receivables arising from Customer K’s default
under its finance lease agreement, and impairment losses related to trade and notes receivables.
SUMMARY
–3 1–


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In this prospectus, unless the context otherwise requires, the following expressions shall
have the following meanings.
“Accountant’s Report” the report of the Accountant as set out in “Appendix I —
Accountant’s Report” of this prospectus
“affiliate” with respect to any specified person, 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” or “Articles of
Association”
the Articles of Association of our Company, adopted on
November 5, 2025 with effect from the Listing Date, a
summary of which is set out in Appendix VI to this
prospectus
“Audit Committee” the audit committee of our Company, the details of which
are described in “Corporate Information” in this prospectus
“Board” or “Board of Directors” the board of directors of our Company
“business day” any day (other than a Saturday, Sunday or public holiday in
Hong Kong) on which banks in Hong Kong are generally
open for normal banking business
“Capital Market Intermediary(ies)” has the meaning given to it in the Listing Rules and, unless
the context requires otherwise, refers to the capital market
intermediaries named in “Directors and Parties Involved in
the Global Offering” in this prospectus
“CCASS” The Central Clearing and Settlement System established
and operated by HKSCC
“Changsha CiDi Construction” Changsha CiDi Intelligent Construction Co., Ltd. (ӍҎ
ப΂ʮ̡ ), a company established under
the laws of the PRC with limited liability on July 29, 2019,
our direct non-wholly owned subsidiary
DEFINITIONS
–3 2–


--- page 43 ---
“Changsha Gangwan” Changsha Gangwan Investment Partnership (Limited
Partnership) (Ӎಥᝄҳ༟ΥྫΆุ (Υྫ)), a limited
partnership established under the laws of the PRC on
August 25, 2017 and one of our Controlling Shareholders
“Changsha Shengyu” Changsha Shengyu Private Equity Fund Enterprise (Limited
Partnership) (Άุ (Υྫ)), a
limited partnership established under the laws of the PRC
on March 1, 2018 and one of our Controlling Shareholders
“China” or the “PRC” the People’s Republic of China, which for the purpose of
this prospectus and for geographical reference only,
excludes Hong Kong, the Macau Special Administrative
Region of the People’s Republic of China and Taiwan
“CIC” or “Industry Consultant” China Insights Industry Consultancy Limited, an
independent market research consultant, which is an
Independent Third Party
“CiDi Chengdu” CiDi Smart Driving (Chengdu) Technology Co., Ltd. (ࠔ
౽ቷ(ϓே)ʮ̡ ), a company established under the
laws of the PRC with limited liability on April 1, 2022, our
direct wholly-owned subsidiary
“Companies Ordinance” the Companies Ordinance (Chapter 622 of the Laws of
Hong Kong), as amended, supplemented or otherwise
modified from time to time
“Companies (Winding Up and
Miscellaneous Provisions)
Ordinance”
the Companies (Winding Up and Miscellaneous Provisions)
Ordinance (Chapter 32 of the Laws of Hong Kong), as
amended, supplemented or otherwise modified from time to
time
“Company”, “our Company” or “the
Company” or “we” or “us”
CiDi Inc. (ʮ̡ ) (previously known
asʮ̡ ), established as a
limited liability company in the PRC on October 16, 2017
“Compliance Advisor” Gram Capital Limited
DEFINITIONS
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--- page 44 ---
“Controlling Shareholder(s)” has the meaning ascribed to it under the Listing Rules and
unless the context requires otherwise, refers to Prof. Li,
NovoDriv HK, NovoDriv Limited, Changsha Gangwan,
Dongguan Intelligence, CWB Startup HK, Clear Water Bay
Startup Fund GP, Clear Water Bay Startup Fund LP,
Changsha Shengyu and Dongguan Yunhe
“CSRC” the China Securities Regulatory Commission ( ʕ਷ᗇՎ္
ึ )
“CWB Startup HK” CWB Startup Invest HK Limited, a company incorporated
in Hong Kong with limited liability on March 17, 2016 and
one of our Controlling Shareholders
“Director(s)” the director(s) of our Company
“Domestic Unlisted Shares” ordinary shares in the share capital of our Company, with a
nominal value of RMB1.00 each, which are not listed on
any stock exchange
“Dongguan Intelligence” Dongguan Wanqu Intelligence Technology Co., Ltd. (୷
ʮ̡ ), a company established under the
laws of the PRC with limited liability on July 31, 2017 and
one of our Controlling Shareholders
“Dongguan Yunhe” Dongguan Yunhe Equity Investment Co., Ltd. (ٰ
ʮ̡ ), a company established under the laws of
the PRC with limited liability and one of our Controlling
Shareholders
“Dr. Ma” Dr. Ma Wei ( ৵ᐂ), our co-founder, executive Director and
vice chairman
“Eastern China” Anhui, Fujian, Jiangsu, Shanghai, Zhejiang, Jiangxi,
Shandong for purposes of this prospectus
“Experts” the experts set out in “Appendix VII — Statutory and
General Information — E. Other Information — 4.
Qualifications of Experts” of this prospectus
DEFINITIONS
–3 4–


--- page 45 ---
“Extreme Conditions” the occurrence of “extreme conditions” as announced by
any government authority of Hong Kong due to serious
disruption of public transport services, extensive flooding,
major landslides, large-scale power outage or any other
adverse conditions before Typhoon Signal No. 8 or above is
replaced with Typhoon Signal No. 3 or below
“FINI” “Fast Interface for New Issuance”, the 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 the Listing
“Full Circulation Application” the conversion of 37,035,912 Domestic Unlisted Shares
into H Shares on a one-for-one basis upon completion of
the Global Offering
“General Rules of HKSCC” the terms and conditions regulating the use of HKSCC’s
services, as may be amended or modified from time to time
and where the context so permits, shall include the HKSCC
Operational Procedures
“Global Offering” the Hong Kong Public Offering and the International
Offering
“Group,” “our Group,” “the Group,”
“we,” “us” or “our”
the Company and its subsidiaries or, where the context so
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” Guide for New Listing Applicants issued by the Stock
Exchange, as amended, supplemented or otherwise
modified from time to time
“H Share(s)” overseas listed foreign share(s) in the share capital of our
Company, with a nominal value of RMB1.00 each, which
are to be subscribed for and traded in Hong Kong dollars
and for which an application has been made for the
granting of listing and permission to deal in on the Stock
Exchange
DEFINITIONS
–3 5–


--- page 46 ---
“H Share Registrar” Tricor Investor Services Limited
“HK$” or “HKD” or “Hong Kong
dollars”
Hong Kong dollars, the lawful currency of Hong Kong
“HKSCC” Hong Kong Securities Clearing Company Limited, a
wholly-owned subsidiary of Hong Kong Exchanges and
Clearing Limited
“HKSCC Nominee” 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
operation and functions of the systems, 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
People’s Republic of China
“Hong Kong Offer Shares” the 270,400 H Shares initially being offered for
subscription in the Hong Kong Public Offering (subject to
reallocation as described in “Structure of the Global
Offering”)
“Hong Kong Public Offering” the offer of the Hong Kong Offer Shares for subscription
by the public in Hong Kong, on the terms and subject to
the conditions described in this prospectus as further
described in “Structure of the Global Offering” in this
prospectus
“Hong Kong Stock Exchange” or
“Stock Exchange”
The Stock Exchange of Hong Kong Limited
“Hong Kong Underwriters” the underwriters of the Hong Kong Public Offering listed in
“Underwriting” in this prospectus
DEFINITIONS
–3 6–


--- page 47 ---
“Hong Kong Underwriting
Agreement”
the underwriting agreement dated December 10, 2025,
relating to the Hong Kong Public Offering and to be
entered into by our Company, Prof. Li, the Joint Sponsors,
the Joint Overall Coordinators and the Hong Kong
Underwriters, as further described in “Information about
this Prospectus and the Global Offering — Underwriting
and Information on the Global Offering” in this prospectus
“Independent Third Party(ies)” an individual(s) or a company(ies) who or which is/are not
connected person(s) (within the meaning of the Listing
Rules) of the Company
“International Offer Shares” the 5,137,580 H Shares being initially offered for
subscription under the International Offering
“International Offering” the offer of the International Offer Shares by the
International Underwriters outside the United States in
offshore transactions in accordance with Regulation S
under the U.S. Securities Act or in accordance with
available exemption from the registration requirement
under the U.S. Securities Act, as further described in
“Structure of the Global Offering” in this prospectus
“International Underwriters” the underwriters of the International Offering
“International Underwriting
Agreement”
the international underwriting agreement, expected to be
entered into on or about December 17, 2025, relating to the
International Offering, by our Company, the Controlling
Shareholders, the Joint Overall Coordinators and the
International Underwriters, as further described in
“Underwriting — Underwriting arrangements and expenses
— International Offering — International Underwriting
Agreement” in this prospectus
“Joint Bookrunners” the joint bookrunners as named in “Directors and Parties
Involved in the Global Offering” of this prospectus
“Joint Global Coordinators” the joint global coordinators as named in “Directors and
Parties Involved in the Global Offering” of this prospectus
DEFINITIONS
–3 7–


--- page 48 ---
“Joint Lead Managers” the joint lead managers as named in “Directors and Parties
Involved in the Global Offering” of this prospectus
“Joint Overall Coordinators” has the meaning given to it in the Listing Rules and, unless
the context requires otherwise, refers to the joint overall
coordinators named in “Directors and Parties Involved in
the Global Offering” in this prospectus
“Joint Sponsors” China International Capital Corporation Hong Kong
Securities Limited, China Securities (International)
Corporate Finance Company Limited and Ping An of China
Capital (Hong Kong) Company Limited
“Latest Practicable Date” December 2, 2025, being the latest practicable date for
ascertaining certain information in this prospectus before
its publication
“Listing” the listing of the Shares on the Main Board
“Listing Committee” the Listing Committee of the Hong Kong Stock Exchange
“Listing Date” the date, expected to be on or around Friday, December 19,
2025, on which our H Shares are listed and from which
dealings therein are permitted to take place on the Hong
Kong Stock Exchange
“Listing Rules” or “Hong Kong
Listing Rules”
the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited, as amended,
supplemented or otherwise modified from time to time
“M&A Rules” Regulations on Merger with and Acquisition of Domestic
Enterprises by Foreign Investors (Իᒅྤ
) jointly issued by the MOFCOM, the
SASAC, the STA, the CSRC, the SAIC and the SAFE on
August 8, 2006, effective as of September 8, 2006 and
amended on June 22, 2009
“Main Board” the stock market (excluding the option market) operated by
the Stock Exchange which is independent from and
operated in parallel with the GEM of the Stock Exchange
DEFINITIONS
–3 8–


--- page 49 ---
“MOF” the Ministry of Finance of the People’s Republic of China
(௅ )
“MOFCOM” Ministry of Commerce of the PRC ( ʕശɛ͏΍ձ਷ਠਕ
௅)
“NDRC” the National Development and Reform Commission of the
PRC (ึ )
“NIM” the National Institute of Metrology, China (ኪ
Ӻ৫)
“Nomination Committee” the nomination committee of our Company, the details of
which are described in “Corporate Information” in this
prospectus
“Northeastern China” Heilongjiang, Jilin, Liaoning for purposes of this
prospectus
“Northern China” Hebei, Shanxi, Inner Mongolia, Beijing, Tianjin for
purposes of this prospectus
“Northwestern China” Shaanxi, Gansu, Qinghai, Ningxia, Xinjiang for purposes of
this prospectus
“NovoDriv Chongqing” New Drive Chongqing Intelligent Vehicle Co., Ltd. ( อᚨਗ
ʮ̡ ), a company established under the
laws of the PRC with limited liability on May 29, 2020,
our direct wholly-owned subsidiary
“NovoDriv HK” NovoDriv (HK) Limited Partnership, a limited partnership
registered under the laws of Hong Kong on August 11,
2017 and one of our Controlling Shareholders
DEFINITIONS
–3 9–


--- page 50 ---
“Offer Price” HK$263.00, being the offer price per Offer Share
(exclusive of 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%), at
which Hong Kong Offer Shares are to be subscribed for
pursuant to the Hong Kong Public Offering and
International Offer Shares are to be offered pursuant to the
International Offering
“Offer Shares” the Hong Kong Offer Shares and the International Offer
Shares, being the Shares of the Company
“Ordinary Shares” or “Shares” ordinary shares in the share capital of the Company
“Over-allotment Option” the option expected to be granted by our Company to the
International Underwriters, exercisable by the Overall
Coordinators (on behalf of the International Underwriters)
pursuant to the International Underwriting Agreement,
pursuant to which our Company may be required to allot
and issue additional H Shares to, among other things, cover
over-allocations in the International Offering, if any, further
details of which are described in the section headed
“Structure of the Global Offering” in this Prospectus
“Pathfinder SII(s)” has the meaning ascribed to it in Chapter 2.5 of the Guide
for New Listing Applicants issued by the Stock Exchange
“PBOC” People’s Bank of China ( ʕ਷ɛ͏ვБ )
“PRC Company Law” the Company Law of the PRC, as amended, modified
and/or otherwise supplemented from time to time
“PRC Legal Advisor” Zhong Lun Law Firm, the PRC legal advisor to our
Company
“Pre-IPO Investments” the Pre-IPO investments in our Company undertaken by the
Pre-IPO Investors, details of which are set out in “History,
Development and Corporate Structure — Pre-IPO
Investments” in this Prospectus
DEFINITIONS
–4 0–


--- page 51 ---
“Pre-IPO Investors” the investor(s) who participated in our Pre-IPO
Investments, details of which are set out in “History,
Development and Corporate Structure — Pre-IPO
Investments” in this Prospectus
“Prof. Li” Professor Li Zexiang ( ҽዣಱ઺બ ), our founder, chairman
of the Board and non-executive Director
“Remuneration Committee” the remuneration committee of our Company, the details of
which are described in “Corporate Information” in this
prospectus
“RMB” or “Renminbi” Renminbi, the lawful currency of the PRC
“SAFE” the State Administration of Foreign Exchange of the PRC
(̮ි၍ଣ҅ )
“SAMR”, or formerly known as
“SAIC”
the State Administration for Market Regulation of the PRC
(̹ఙ္ຖ၍ଣᐼ҅ ), formerly known
as State Administration of Industry and Commerce of the
PRC (၍ଣᐼ҅ )
“Securities and Futures (Stock
Market Listing) Rules”
the Securities and Futures (Stock Market Listing) Rules
(Chapter 571V of the Laws of Hong Kong), as amended,
supplemented or otherwise modified from time to time
“SFC” the Securities and Futures Commission of Hong Kong
“SFO” the Securities and Futures Ordinance (Chapter 571 of the
Laws of Hong Kong), as amended, supplemented or
otherwise modified from time to time
“Shareholder(s)” holder(s) of our Shares
“SOE” state-owned enterprise
“South-Central China” Henan, Hubei, Hunan, Guangdong, Guangxi, Hainan for
purposes of this prospectus
“Southwestern China” Chongqing, Sichuan, Guizhou, Yunnan, Tibet for purposes
of this prospectus
DEFINITIONS
–4 1–


--- page 52 ---
“Sponsor-Overall Coordinators” China International Capital Corporation Hong Kong
Securities Limited and China Securities (International)
Corporate Finance Company Limited
“STA” the State Taxation Administration of the PRC ( ʕശɛ͏΍
೼ਕᐼ҅ )
“Stabilizing Manager” China International Capital Corporation Hong Kong
Securities Limited
“State Council” the PRC State Council ( ʕശɛ͏΍ձ਷਷ਕ৫ )
“subsidiary(ies)” has the meaning ascribed to it under the Companies
Ordinance
“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
“TCC” TCC Group Holdings Co., Ltd,. formerly known as Taiwan
Cement Corporation, an Independent Third Party
“Tianjin CiDi” Tianjin CiDi Intelligent Network Technology Co., Ltd. ( ˂
ʮ̡ ), a company established
under the laws of the PRC with limited liability on
December 14, 2020, our direct wholly-owned subsidiary
“Track Record Period” the period comprising the three years ended December 31,
2024 and the six months ended June 30, 2025
“Underwriters” the Hong Kong Underwriters and International
Underwriters, as named in the Hong Kong Underwriting
Agreement and International Underwriting Agreement
respectively
“United States”, “U.S.” or “US” the United States of America, its territories, its possessions
and all areas subject to its jurisdiction
“U.S. Securities Act” United States Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder
DEFINITIONS
–4 2–


--- page 53 ---
“U.S. Export Control and Sanctions
Counsel”
Pillsbury Winthrop Shaw Pittman LLP, the U.S. export
control and sanctions counsel of our Company
“US$”, “USD” or “U.S. dollars” United States dollars, the lawful currency for the time
being of the United States
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 the 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
–4 3–


--- page 54 ---
This glossary contains explanations of certain technical terms used in this prospectus. As
such, these terms and their meanings may not correspond to standard industry meanings or
usage of these terms.
“AD” advanced autonomous driving, a technology that enables
vehicles to operate itself in certain or all conditions
“AI” artificial intelligence, a field of research in computer
science focused on creating systems capable of performing
tasks that typically require human intelligence
“Automatic Emergency Braking” or
“AEB”
a system which can automatically detect a potential forward
collision and activate the vehicle braking system to
decelerate a vehicle with the purpose of avoiding or
mitigating a collision
“automotive OEM” the original equipment manufacturer, which assembles and
installs automotive parts during the construction of a new
vehicle
“autonomous” when describing mining or logistics trucks, means that the
vehicle has reached AD level, where it can perceive its
environment, make decisions and control its movements
without human intervention
“AUTOSAR” Automotive Open System Architecture, an open and
standardized global software architecture for automotive
electronic control units developed by leading automotive
manufacturers and suppliers
“BEV” bird’s-eye view, an elevated view of an object or location
from a very steep viewing angle, creating a perspective as
if the observer were a bird in flight looking downwards
“BVR” or “beyond-line-of-sight” in vehicle perception, refers to the ability of a vehicle to
detect and respond to objects or hazards that are beyond the
immediate line of sight using advanced sensing
technologies such as radar, LiDAR and V2X
communication
GLOSSARY OF TECHNICAL TERMS
–4 4–


--- page 55 ---
“CCC” China Compulsory Certificate, a certification of product
quality and safety
“CIP” or “cooperative intersection
passing”
a scenario where vehicles are coordinated to move through
intersections safely and efficiently, preventing collisions
and optimizing traffic flow
“CVM” or “cooperative vehicle
merge”
a scenario where vehicles are coordinated for safe and
efficient on-ramp merging
“C-ITS group standards” Cooperative Intelligent Transport Systems group standards
that aim to enhance road safety, traffic efficiency and
environmental sustainability by facilitating Vehicle-to-Vehicle
and Vehicle-to-Infrastructure communications
“C-V2X” Cellular Vehicle-to-Everything, referring to the low-latency
communication system between vehicles and vehicles,
vehicles and pedestrians, vehicles and road infrastructure,
and vehicles and networks
“deep learning” a machine learning technique that constructs artificial
neural networks with multiple layers to extract features
from the raw input
“DMS” Driver Monitoring System, a vehicle safety system to
monitor the driver’s alertness and warn the driver if needed
and eventually apply the brakes
“drive-by-wire” a design where vehicle functions such as steering, braking
and acceleration are electronically controlled via commands
sent through electronic interfaces, replacing the traditional
manual controls such as pedals or levers operated by the
hand and foot
“DSRC” dedicated short-range communications, a wireless
communication protocol enabling vehicles to communicate
with each other and with roadside infrastructures
“edge” hardware or service that brings computation and data
storage closer to where the data is produced
GLOSSARY OF TECHNICAL TERMS
–4 5–


--- page 56 ---
“electrification” in the automotive industry, refers to the process of
powering the vehicle by electricity, replacing vehicle
components that operate on a conventional energy source
“EN50126:2017” a European standard for the reliability, availability,
maintainability and safety of railway systems
“EN50128:2011” a European standard for the software used in railway
control and protection systems
“EN50129:2018” a European standard that focuses on the safety related
electronic systems for signaling in the railway sector
“factory-installed autonomous
perception system”
Autonomous perception system that is installed by the
manufacturer (in contrast to the autonomous perception
system that may be installed by the owner or the dealer)
“GNSS” Global Navigation Satellite System, a collective term for a
series of satellite navigation systems that provides global
positioning, speed, time and other related information
“HLW” or “hazardous location
warning”
a safety alert transmitted between vehicles and
infrastructure to notify drivers of potentially dangerous
road conditions or areas, such as accidents, construction
zones, or adverse weather, enhancing drivers’ situational
awareness and preventing collisions
“IATF 16949” a technical specification aimed at the development of a
quality management system which provides for continual
improvement, emphasizing defect prevention and the
reduction of variation and waste in the automotive industry
supply chain and assembly process
“IMU” Inertial Measurement Unit, referring to an electronic device
that measures the vehicle’s acceleration, orientation,
angular rates and other gravitational force, providing data
for navigation and positioning
“IPU” Intelligent Processing Unit, referring to an on-board
computing device capable of enabling various intelligent
functionalities
GLOSSARY OF TECHNICAL TERMS
–4 6–


--- page 57 ---
“ISO” the International Organization for Standardization, an
independent, non-governmental organization that develops
and publishes international standards
“ISO 14001” an internationally recognized standard for Environmental
Management System published by the ISO
“ISO 45001” an internationally recognized standard for Occupational
Health and Safety Management Systems published by the
ISO
“ISO 9001” an internationally recognized standard for Quality
Management Systems published by the ISO
“km/h” kilometer per hour
“latency” the delay between the transmission of data and its reception
or processing
“LDW” or “lane departure warning” a mechanism designed to warn the driver when the vehicle
begins to move out of its lane (unless a turn signal is on in
that direction) on freeways and arterial roads
“LiDAR” a remote sensing device that uses light from a laser to
measure the relative spatial positions of objects
“mass production” a large-scale production phase that adopts automated
intelligent manufacturing and engineering facilities to
ensure product consistency, reduce labor costs, enhance
utilization, and achieve cost-efficiency
“MEC” or “multi-access edge
computing”
a network architecture that brings computing of traffic and
storage closer to end-users, reducing latency and enabling
real-time applications by deploying resources at the edge of
the network
“metaverse” refers to the convergence of physical, augmented and
virtual reality in a shared online space
GLOSSARY OF TECHNICAL TERMS
–4 7–


--- page 58 ---
“mmWave radar” millimeter wave radar, referring to the radar that uses
millimeter wave frequencies to detect objects in real-time,
providing information from four dimensions including their
range, azimuth, elevation and velocity
“ms” milliseconds
“multi-agent system” a system composed of multiple interacting intelligent
agents that can communicate, cooperate or compete to
achieve collective goals, which are difficult for an
individual agent to solve
“neural network” in the context of AI, refers to a machine learning algorithm
or model that mimics the human brain
“new engineering education
transformation”
a program launched by the Massachusetts Institute of
Technology (MIT) that redefines undergraduate engineering
education through interdisciplinary, project-based learning,
preparing students to solve complex, real-world problems
in specialized tracks such as autonomous machines and
climate & sustainability systems
“new quality productive forces” referring to productivity led by technological innovation
that breaks away from the traditional mode of economic
growth and development pathway
“NIM” National Institute of Metrology
“OBU” on-board unit, referring to a device installed on vehicles
enabling V2X communication and supporting V2X
applications
“perception” in autonomous vehicles, refers to the ability of vehicles to
perceive and understand its environment, process and
interpret data from sensors and base decisions on this
knowledge
“R&D” research and development
GLOSSARY OF TECHNICAL TERMS
–4 8–


--- page 59 ---
“redundancy” referring to employing two or more parallel systems,
sensors or components that perform the same or similar
functions to ensure that the vehicle can continue to operate
safely in the event of partial failure
“RSU” roadside unit, referring to device installed on the roadside
enabling V2X communication and supporting V2X
applications
“RTK system” Real-Time Kinematic Positioning system, referring to a
high-precision GNSS technology that collects and process
signals from GNSS satellites to provide real-time accurate
“sensor” a device, module, machine, or subsystem whose purpose is
to detect events or changes in its environment and send the
information to other electronics, frequently a computer
processor
“sensor fusion” the comprehensive analysis of data and information from
multiple sensors to reduce uncertainty, resulting in more
precise, comprehensive and reliable information
“SIL2” safety integrity level 2, the moderate level in the safety
integrity level classification system that evaluates the
safety performance of safety-related equipment, with SIL 4
being the most stringent
“SIL4” safety integrity level 4, the highest level in the safety
integrity level classification system, standing for low
probability of failure and rigorous safety assurance
processes
“T/CSAE 53-2017 standard” the standard specifying the terms and definitions of the
application layer of the cooperative intelligent
transportation system, vehicle communication system, as
well as the data set and data interaction standards and
interface specifications
GLOSSARY OF TECHNICAL TERMS
–4 9–


--- page 60 ---
“teleoperation station” a system that allows operators to monitor and control the
vehicle or equipment from a distance, providing operators
with real-time data, video feeds and the ability to intervene
during the operation
“TOPS” tera operations per second, a unit used to measure the
computational power of processors
“track-side devices” any devices installed alongside the railway tracks, serving a
specific function relating to train operations, including
signals, switches, sensors and communication systems
“TSP” or “Transit Signal Priority” a system that enables communication between transit
vehicles and traffic signals to optimize signal timing,
giving priority to public transportation at intersections
“V2I” vehicle-to-infrastructure, referring to wireless
communication technology between OBUs and RSUs
“V2V” vehicle-to-vehicle, referring to wireless information
exchange and communication technology between OBUs,
enabling real-time sharing of driving data such as speed,
position and direction to enhance road safety and traffic
efficiency
“V2X” vehicle-to-everything, referring to the communication
between a vehicle and any entity that may affect, or may be
affected by, the vehicle
“VRUCW” or “vulnerable road user
collision warning”
a system that alerts drivers to the presence of vulnerable
road users, such as pedestrians, cyclists and motorcyclists,
in the vehicle’s path or vicinity, helping to prevent
collisions by enhancing driver awareness
“WDW” or “wrong-way driving
warning”
a scenario where drivers and surrounding vehicles are
alerted when a vehicle is traveling in the wrong direction
on a roadway
GLOSSARY OF TECHNICAL TERMS
–5 0–


--- page 61 ---
This prospectus includes forward-looking statements. All statements other than statements of
historical facts contained in this prospectus, including, without limitation, those regarding our
future financial position, our strategy, plans, objectives, goals, targets and future developments in
the markets where we participate or are seeking to participate, and any statements preceded by,
followed by or that include the words “believe,” “expect,” “estimate,” “predict,” “aim,” “intend,”
“will,” “may,” “plan,” “consider,” “anticipate,” “seek,” “should,” “could,” “would,” “continue,” or
similar expressions or the negative thereof, are forward-looking statements. These forward-looking
statements involve known and unknown risks, uncertainties and other factors, some of which are
beyond our control, which may cause our actual results, performance or achievements, or industry
results, to be materially different from any future results, performance or achievements expressed
or implied by the forward-looking statements. These forward-looking statements are based on
numerous assumptions regarding our present and future business strategies and the environment in
which we will operate in the future. Important factors that could cause our actual performance or
achievements to differ materially from those in the forward-looking statements include, among
others, the following:
 general political and economic conditions, including those related to the PRC;
 our business prospects and our ability to successfully implement our business plans and
strategies;
 future developments, trends and conditions in the industry and markets in which we
operate or into which we intend to expand;
 our capital expenditure plans;
 the actions and developments of our competitors;
 our financial condition and performance;
 our dividend policy;
 any changes in the laws, rules and regulations of the central and local governments in
the PRC and other relevant jurisdictions and the rules, regulations and policies of the
relevant governmental authorities relating to all aspects of our business and our business
plans;
 changes or volatility in interest rates, foreign exchange rates, equity prices or other rates
or prices, including those pertaining to the PRC and the industry and markets in which
we operate;
FORW ARD-LOOKING STATEMENTS
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 various business opportunities that we may pursue; and
 capital market developments, changes in the global economic conditions and material
volatility in the global financial markets.
Additional factors that could cause actual performance or achievements to differ materially
include, but are not limited to, those discussed under “Risk Factors” and elsewhere in this
prospectus. We caution you not to place undue reliance on these forward-looking statements,
which reflect our management’s view only as of the date of this prospectus. We undertake no
obligation to update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise. In light of these risks, uncertainties and assumptions, the
forward-looking events discussed in this prospectus might not occur. All forward-looking
statements contained in this prospectus are qualified by reference to the cautionary statements set
out in this section.
FORW ARD-LOOKING STATEMENTS
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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 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 headed “Forward-Looking
Statements” in this prospectus.
We believe there are certain risks and uncertainties involved in our operations, some of which
are beyond our control. We have categorized these risks and uncertainties into: (i) risks relating to
the research and development of our products and solutions; (ii) risks relating to the
commercialization of our products and solutions; (iii) risks relating to the manufacturing of our
products; (iv) risks relating to our intellectual property rights; (v) risks relating to our financial
condition and need for additional capital; (vi) risks relating to our general operations; (vii) risks
relating to conducting business in the place where we operate; and (viii) risks relating to the global
offering.
Additional risks and uncertainties that are presently not known to us or not expressed or
implied below or that we currently deem immaterial could also harm our business, results of
operations and financial condition. You should consider our business and prospects in light of the
challenges we face, including those discussed in this section.
RISKS RELATING TO THE RESEARCH AND DEVELOPMENT OF OUR PRODUCTS
AND SOLUTIONS
If we are unable to develop new products and solutions that adapt to changing market
demand and customer needs in a cost-effective and timely manner, our future business,
results of operations, financial condition and competitive position would be materially and
adversely affected.
Our future business, results of operations, financial condition and competitive position
depend on our ability to develop new and enhanced autonomous driving products and solutions in
closed environments for commercial vehicles that incorporate and integrate the latest technological
advancements in sensing and perception technologies, software and hardware, and camera, radar,
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LiDAR, AI and deep learning technologies to satisfy evolving customer demands, regulatory
requirements and industry standards. Intelligent driving is an emerging technology, and we may
encounter significant unexpected technical and production challenges, or delays in completing the
development of new and enhanced products and solutions and ramping up production in a
cost-efficient manner, which require us to invest significant resources in R&D and also require that
we:
 design innovative, accurate, and safety- and efficiency-enhancing functions that
differentiate our products and solutions from those of our competitors;
 continuously improve the reliability of our autonomous driving, V2X and intelligent
perception technologies;
 cooperate effectively on new designs and development with our customers, suppliers and
partners;
 respond effectively to technological changes and product announcements by our
competitors; and
 adjust to changing customer requirements, market conditions, and regulatory standards
quickly and cost-effectively.
If there are delays in, or if we fail to complete when expected or at all, the development of
new and enhanced products and solutions, we may not be able to satisfy our customers’
requirements, achieve additional sales to existing or new customers, or achieve broader market
acceptance of our products and solutions, and our business, results of operations, financial
condition and competitive position would be materially and adversely affected.
We have been and intend to continue investing significantly in R&D, which may adversely
affect our profitability and operating cash flow and may not generate the results we expect to
achieve.
Our ability to develop new technologies, design new products and solutions, and enhance
existing products and solutions is critical for maintaining our market position. We have been
investing heavily in our R&D efforts. Our research and development expenses amounted to
RMB110.5 million, RMB90.4 million, RMB193.2 million, RMB35.3 million and RMB151.3
million in 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025, respectively. The
industries in which we operate are subject to rapid technological changes and are evolving quickly
in terms of technological innovation. We need to invest significant resources, including financial
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resources, in R&D to make technological advances in order to expand our offerings and make our
products and solutions innovative and competitive in the market. As a result, we may continue to
incur significant R&D expenses in the future.
In addition, to enhance our market position, we expect to incur significant capital
expenditures for R&D of new products and solutions, purchase of property, plant and equipment
and purchase of intangible assets. Our capital expenditures were RMB153.4 million, RMB30.4
million, RMB2.1 million, RMB0.6 million and RMB1.8 million in 2022, 2023, 2024 and the six
months ended June 30, 2024 and 2025, respectively. See “Financial Information — Capital
Expenditures.”
However, inherent risk exists for such significant R&D expenditures and capital expenditures
as our investment may not succeed or generate the benefits that we expect. Development activities
are inherently uncertain, and we may not be able to obtain and retain sufficient resources,
including qualified R&D personnel. Even if we succeed in our R&D efforts and generate the
results we expect, our short-term cash flow and liquidity may be adversely affected, and we may
still encounter practical difficulties in commercializing our development results. New technologies
could render our technologies, our technological infrastructure or products and solutions that we
are developing, or expect to develop in the future obsolete or unattractive, thereby limiting our
ability to recover related product development costs, which could result in a decline in our
revenues, profitability and market share. In addition, if it is determined that our innovations
require any filings with regulatory authorities or the fulfillment of other requirements, and we fail
to complete such filings or meet such requirements in a timely manner, it may increase our
expenses or prevent us from successfully commercializing new products, solutions or technologies.
Our R&D efforts may not contribute to our future results of operations for several years, if at
all, and such contributions may not meet our expectations or even cover the costs of such efforts,
which would materially and adversely affect our business, results of operations, financial condition
and competitive position.
RISKS RELATING TO THE COMMERCIALIZATION OF OUR PRODUCTS AND
SOLUTIONS
Intelligent driving is an emerging technology, and we face significant technical challenges to
develop and commercialize our technology.
The intelligent driving industry is rapidly evolving. The industry faces a significant number
of technical and commercial challenges, including an expectation for outperforming manned
operations in terms of both efficiency and safety, large funding requirements, long vehicle
development lead times, specialized skills and expertise requirements of personnel, evolving
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regulatory frameworks, a need to build public trust and brand image, and real-world operation of
an entirely new technology. If we are not able to overcome these challenges, our business,
prospects, financial condition and results of operations will be negatively impacted and our ability
to create a viable business may not materialize at all.
The future commercial success of our products will depend on the degree of their market
acceptance among customers. Given that our development and sales cycles can be long and
unpredictable, and we have limited track record of commercializing our products and solutions, the
future commercial success of our products and solutions is subject to inherent uncertainties.
Market acceptance of intelligent driving solutions and products depends upon many factors,
including regulatory requirements, evolving safety standards, costs and technological advancement.
Market acceptance of intelligent driving solutions and products may also be adversely affected by
safety incidents involving intelligent driving solutions and products, even if the incidents do not
involve our solutions and products. In particular, our V2X products and solutions are sensitive to
changes and uncertainty in industry policies and technical standards. For example, the decrease of
revenue generated from V2X from RMB28.2 million in the six months ended June 30, 2024 to
RMB20.5 million in the six months ended June 30, 2025 was primarily attributable to the
uncertainty regarding the implementation of industry policies and standards, which affected
potential customers’ procurement decisions and led to temporary softening of market demand.
Market acceptance of our solutions and products also depends on the ability of market
participants, including us, to resolve technical challenges for increasingly complex intelligent
driving solutions and products in a timely and cost-effective manner. We cannot assure you that we
will be able to adjust to market or regulatory conditions quickly or cost-effectively. If we fail to do
so, our business, results of operations and financial condition will be adversely affected.
We have a limited track record in commercialization in a new and rapidly evolving industry
and there can be no assurance that our sales and marketing efforts will succeed.
We are a development-stage company with a limited operating history since 2017. Therefore,
we have a limited track record in developing, commercializing and marketing of our products and
solutions. Our ability to successfully commercialize our products and solutions may involve more
uncertainties, take longer, and cost more than it would if we were a company with a longer track
record in launching and marketing. In particular, the commercialization of new products and
solutions requires additional resources. The success of our sales and marketing efforts depends on
our ability to attract, motivate and retain qualified and professional employees in our
commercialization team who have, among other things, adequate technical knowledge to
communicate effectively with potential customers, sufficient experience in sales and marketing of
products and solutions, and extensive industry connections and experience. We may not be able to
scale up rapidly enough to generate significant revenue, raise additional capital or operate
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profitably. We will continue to encounter risks and difficulties frequently experienced by
companies at an early stage of commercialization, including marketing our products and services,
scaling up our operation and headcount, and may incur unforeseen expenses, difficulties, or delays
in connection with our growth.
Due to our limited track record in commercialization of our products and solutions, there can
be no assurance that our efforts to market and sell our products and solutions will succeed, that the
sales results of our products and solutions will meet our forecast, or that third parties will deploy
and utilize our products and solutions effectively and meet overall user experience. We may invest
significant effort from the time of our initial contact with a customer to the time when they choose
to purchase or incorporate our products and solutions into their vehicles or systems. We could
expend significant resources pursuing, but fail to achieve, customer orders for our products and
solutions. Even after achieving customer orders, the period of time from product design to mass
production may be long and we are subject to the risks of termination or postponement of
contracts or unsuccessful implementation. In addition, we may experience launch and production
ramp delays for new products and features. Any of the above individually or collectively, would
materially and adversely affect the commercialization of our products and solutions or cause us to
incur sales and marketing expenses which we are not able to recover, and, in turn, materially and
adversely affect our business and results of operations.
We depend on growth in the end markets that adopt our products. Any slowdown in the
growth of these end markets could adversely affect our business, financial condition and
results of operations.
We primarily provide autonomous driving products and solutions in closed environments to
customers operating across various industries, including mining, transportation and rail transit. As
such, the demand for our products and solutions is closely linked to the market development and
growth within these end markets, which, in turn, depends on the respective demand for products in
these markets. In addition, our products and solutions can be assembled and integrated into the
machinery, equipment and product offerings of our customers. The product life cycle of the
machinery, equipment and product offerings of our customers will also have a corresponding effect
on the demand for our products and solutions.
Factors affecting our end markets are beyond our control. If any factor occurs in the future
which results in material slowdown of any or all of our major end markets, or the growth of our
end markets is not sustained, our business, financial condition, results of operations and prospects
may be materially and adversely affected. For example, if future demands for mining-related
products decrease for any reason, our customers in the mining sector may experience a
RISK FACTORS
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corresponding decrease in demand for their products, which in turn may materially reduce demand
for our products and solutions and materially and adversely affect our business, results of
operations and financial condition.
Our customers may not purchase our products and solutions in any certain quantity and we
are subject to the risks of termination or postponement of contracts or unsuccessful
implementation.
When customers choose our products or solutions, we typically receive preliminary estimates
of their anticipated order volumes, while such estimates may be revised significantly by the
customer, potentially multiple times, and may not be representative of future order volumes, which
could be significantly higher or lower than estimated. The period of time from product design to
mass production is long and we are subject to the risks of termination or postponement of
contracts or unsuccessful implementation. As a result, obtaining indicative orders is not a
guarantee of revenue. As of June 30, 2025, we received indicative orders for 357 autonomous
mining trucks and 290 sets of standalone autonomous truck systems. As of the same date, we
signed multiple overseas projects with indicative order value reaching RMB64.8 million. If the
sales results of our products and solutions for which we obtain indicative orders do not meet our
forecast, our business, results of operations and financial condition would be materially and
adversely affected.
The sales results of our products and solutions will partially depend on effective deployment
and operation by third parties on, and overall user experience of, the commercial vehicles.
The sales results of our products and solutions will partially depend on our customers and
partners effectively deploying and operating our products and solutions on vehicles, roads, systems
in the future, and their failure to do so may result from factors beyond our control. Our products
and solutions are technologically complex, incorporate many technological innovations, and are
typically subject to significant safety testing, and customers generally must devote significant
resources to test and validate our products and solutions before operating and deploying them. This
results in our investment of resources prior to realizing any revenue. For example, some of our
products and solutions control various vehicle functions including engine, transmission, safety,
steering, navigation and braking, and therefore must be integrated effectively with the other
systems of the vehicle developed by the customers, and we may be unable to achieve the requisite
level of interoperability in a vehicle model for our solutions to be implemented even after we enter
into collaboration with the customer. Despite effective deployment and operation, the vehicle
models integrated with our products and solutions may generate poor sales results due to poor
overall user experience of the vehicle models, which, in turn, affect the sales results of our
products and solutions.
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Furthermore, we have specifically engineered our intelligent driving products and solutions
for commercial vehicles with technology to provide a superior ability to sense, predict, and react
to real-world driving situations. Our proprietary AI and perception capabilities are specifically
engineered to meet the demands of commercial trucks. In certain instances, these protections may
cause the vehicle to behave in ways that are unfamiliar to drivers of non-autonomous driving
trucks. There can be no assurance that our users will be able to properly adapt to the different
operation processes for our autonomous commercial trucks. For example, they may not be able to
adapt their business processes to address activities such as the dispatching of trucks, pre-trip
inspections, remote monitoring, and truck maintenance. Any accidents resulting from such failure
to operate our autonomous commercial trucks properly could harm our brand and reputation, result
in adverse publicity, and product liability claims, and have a material adverse effect on our
business, prospects, financial condition and operating results.
A substantial amount of our revenue is attributable to a limited number of customers in each
year, and such amount may fluctuate in any given period.
Our major customers include manufacturers of commercial vehicles, construction and energy
companies, providers of autonomous driving and V2X technologies and providers of transportation
services, government entities and research institutions. Revenue generated from our largest
customer of each of the year/period during the Track Record Period for the years ended December
31, 2022, 2023, 2024 and the six months ended June 30, 2025 accounted for 78.4%, 31.2%, 37.4%
and 46.7%, respectively, of our revenue during those periods. Revenue generated from our five
largest customers of each of the year/period during the Track Record Period for the years ended
December 31, 2022, 2023, 2024 and the six months ended June 30, 2025 accounted for 96.7%,
64.1%, 80.0% and 94.1%, respectively, of our revenue during those periods.
Given the project-based nature of our business, we derive a substantial portion of revenue
from a limited number of customers during each period. As a result, our gross profit margin is
highly dependent on the terms and profitability of transactions with these major customers, and our
working capital position is also closely tied to the payment terms we negotiate with them. Any
adverse change in pricing, cost structure, or payment terms with these customers could have a
significant impact on our overall gross profit margin, cash flow and liquidity. In addition, our
business, results of operations and financial condition for the foreseeable future may continue to
depend on sales to a relatively small number of customers during the given year. Further, the
amount of revenue attributable to any single major customer, or our major customer concentration
generally, may fluctuate in any given period, which may affect our business, financial condition
and results of operations.
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If we are unable to retain existing customers, acquire new customers, and increase revenue
from our customer base, our financial condition and results of operations would be materially
and adversely affected.
Our ability to retain existing customers, attract new ones, and expand the scope of solutions
and products that our customers utilize is critical to our revenue growth. We served 44, 85, 131
and 152 customers as of December 31, 2022, 2023, 2024 and June 30, 2025, respectively. Our
customer engagement may decrease for a variety of reasons, including their level of satisfaction
with our products and services, our pricing and the pricing and quality of competing products or
services, overall economic conditions, or changes to our customers’ operations. If we are unable to
encourage customers to contract and use our products and solutions, anticipate changing industry
trends, enhance our offerings, innovate and develop new products and solutions that meet our
customers’ evolving needs, and expand our operations into new markets, we may not be able to
attract and acquire new customers. Our success will depend on our ability to continue to expand
our sales capabilities to widen our customer base. If we are unable to attract, motivate and retain a
sufficient number of qualified sales and marketing personnel to support our business, the
commercialization of our products and solutions and our ability to attract new customers may be
adversely affected. The loss of a significant number of customers, or a decline in their growth rate,
could have a material adverse effect on our business, financial condition, results of operations and
prospects. The growth of our business depends in part on existing customers continuing or
expanding their use of our products and solutions. However, our customers have no obligation to
continue to use our products and solutions, and we cannot assure you that they will. If we are
unable to retain customers and maintain their continued or broadening use of our products and
solutions, or if there is a decline in our customers’ business performance, our growth may slow or
decline, and our business may be materially and adversely affected.
Any failure to offer high-quality maintenance and support services for our customers may
harm our relationships with them and, consequently, our business.
As we continue to grow our customer base, we need to be able to continue to provide
efficient customer support and maintenance services that meet our customer demand at scale. We
may not be able to recruit or retain sufficient qualified support personnel with experience in
supporting customers of our products and solutions. As a result, we may be unable to timely
respond to accommodate short-term increases in customer demand for technical support or
maintenance assistance. We also may be unable to modify the future scope of our maintenance
services and technical support to compete with changes in the technical services provided by our
competitors. Any failure to maintain high-quality maintenance and support services would harm
our business. If we experience increased customer demand for support and maintenance, we may
face increased costs that might harm our results of operations. Any delays in adding servicing
capacity or servicing our vehicles efficiently, unforeseen issues with the reliability of our vehicles
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or failure to offer high-quality maintenance and support services for our customers may harm our
relationships with them and, consequently, our business. Our ability to attract new customers is
highly dependent on our business reputation and positive recommendations from our existing
customers. Any failure to maintain high-quality maintenance and support services, or any market
perception that we do not maintain high-quality maintenance and support services for our
customers, would harm our business.
The size of our addressable markets and the demand for our products and solutions may not
increase as rapidly as we anticipate due to a variety of factors, which would materially and
adversely affect our business, results of operations, financial condition and prospects.
We are pursuing opportunities in markets that are undergoing rapid changes, including
technological and regulatory changes, and it is difficult to predict the timing and size of the
opportunities for each of our products and solutions. See “— Risks Relating to Our General
Operations — The industries that we operate in are highly competitive. If we fail to compete with
our competitors, our business, results of operations and financial condition may be materially and
adversely affected.”
Our future financial performance will depend on our ability to make timely investments in
the correct market opportunities. If one or more of these markets experience a shift in customer or
prospective customer demand, then our products and solutions may not compete as effectively, if
at all, and they may not be incorporated into commercialized end customer products. Given the
evolving nature of the markets in which we operate, it is difficult to predict customer demand or
adoption rates for our products and solutions or the future growth of the markets in which we
operate. The addressable markets for our products and solutions may be smaller than we have
estimated, our future growth opportunities and sales growth may be smaller than we estimate, and
our future business, results of operations and financial condition may be materially and adversely
affected. Even if the markets in which we operate grow substantially, there is no guarantee that
demand for our products and solutions will correlate with that growth if we fail to effectively
pursue such opportunities. There is also no guarantee that our business will be successful simply
because of the future addressable markets of our products and solutions, or because of the trends
of the addressable markets of our products and solutions. If demand does not develop or if we
cannot accurately forecast customer demand, then the size of our markets, inventory requirements
or our future business, results of operations and financial condition would be adversely affected.
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RISKS RELATING TO THE MANUFACTURING OF OUR PRODUCTS
Dependency on third-party suppliers to manufacture, assemble and test our products reduces
our control over product quantity and quality, and could harm our business.
We engage third-party suppliers for components and parts required in the manufacturing of
our products. We also collaborate with contract manufacturers for the manufacturing, assembly and
testing of our vehicles and other products. Charges from our largest supplier of each of the
year/period during the Track Record Period for our key business operations for the years ended
December 31, 2022, 2023, 2024 and the six months ended June 30, 2025 accounted for 18.0%,
32.9%, 44.3% and 45.0%, respectively, of our total purchase amount during those years. Charges
from our five largest suppliers of each of the year/period during the Track Record Period for our
key business operations for the years ended December 31, 2022, 2023, 2024 and the six months
ended June 30, 2025 accounted for 35.6%, 47.9%, 59.2% and 84.1%, respectively, of our total
purchase amount during those years. If we are unable to maintain our contractual relationships
with such third parties, or if we are unable to continue using or obtaining these services on
commercially reasonable terms, we may not be able to secure alternatives in a timely manner or at
all, which may, in turn, materially and adversely affect our business, results of operations,
financial condition and competitive position. We also face several risks which could adversely
affect our ability to meet customer demand and scale our supply chain, negatively impact
longer-term demand for our products and services, and adversely affect our business operations,
gross margin, revenue and financial results, including:
 failure by our contract manufacturers to procure raw materials or to provide adequate
levels of manufacturing or test capacity for our products;
 reliance on a single or limited suppliers and manufacturers;
 limited number of suppliers available to choose from as a result of international trade
policies and sanctions. See “— Risks Relating to Our General Operations — We may be
subject to risks associated with international trade policies, investment restrictions,
geopolitics and trade protection measures, including imposition of trade restrictions and
sanctions, and our reputation, business, results of operations and financial condition
could be adversely affected”;
 loss of a supplier and additional expense and/or production delays as a result;
 lack of direct control over product quantity, quality and delivery schedules;
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 suppliers or their suppliers failing to supply high-quality products and/or making
changes to their products without our qualification;
 delays in product shipments, shortages, a decrease in product quality and/or higher
expenses in the event our suppliers prioritize our competitors’ or other customers’ orders
over ours;
 fraudulent or illegal activities or other misconduct by suppliers. See “ — Risks Relating
to Our General Operations — Failure to detect or prevent fraudulent or illegal activities
or other misconduct by our employees, customers, suppliers or other third parties may
materially and adversely affect our business”;
 low manufacturing yields resulting from a failure in our product design or a contract
manufacturer’s production process; and
 disruptions in manufacturing, assembly and other processes due to closures related to
natural disasters or other incidents.
A significant disruption in our supply chain that affects the manufacturing or sourcing of our
products or components for any reason, including those mentioned above, could interrupt product
supply and significantly delay our development plans or commercialization efforts. Such
disruptions, if not remedied, could lead to delay of our research and development plans, loss of
orders and customers, litigation or regulatory action, financial penalties, and reputational damage
that could materially and adversely affect our business, results of operations and financial
condition.
Our intelligent driving technology and related hardware and software could have undetected
defects, errors or bugs in hardware or software which could create safety issues, reduce
market adoption, damage our reputation with current or prospective customers or expose us
to product liability and other claims that could materially and adversely affect our business.
Our autonomous driving, V2X and intelligent perception technologies are highly technical
and complex, and may experience defects, errors or bugs at various stages of development. We
may be unable to timely correct problems to our customers’ satisfaction. Additionally, there may
be undetected errors or defects especially as we introduce new systems or as new versions are
released. Errors or defects in our products may only be discovered after they have been tested,
commercialized, and deployed. If that is the case, we may incur significant additional development
costs and product recall, repair or replacement costs.
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Our technology is used for intelligent driving, which entails the risk of significant injury,
including fatalities. We may be subject to claims if one of our trucks, or a user’s truck, is involved
in an accident and persons are injured or purport to be injured or if property is damaged. Any
insurance that we carry may not be sufficient or it may not apply to all situations. If we experience
such an event or multiple events, our insurance premiums could increase significantly, or insurance
may not be available to us at all. Further, if insurance is not available on commercially reasonable
terms, or at all, we might need to self-insure. In addition, lawmakers or governmental agencies
could pass laws or adopt regulations that standardize the use of autonomous trucking technology or
increase liability associated with its use. Any of these events could adversely affect our brand,
relationships with users, operating results, or financial condition.
In addition, we could face material legal claims for breach of contract, product liability,
personal injury or breach of warranty as a result of these problems. Given that many of our
customers use our products and solutions in processes that are critical to their businesses, any
error, defect, security vulnerability, service interruption or software issue in our products and
solutions could result in losses to our customers. Our customers may seek significant compensation
from us for any losses they suffer or cease conducting business with us altogether. Further, our
customers may share information about their negative experiences on social media, which could
damage our reputation and result in a loss of future sales. A claim brought against us by any of our
customers would likely be time-consuming, costly to defend and may materially and adversely
affect our reputation and brand, making it harder for us to sell our products and solutions.
Increases in costs of the materials and other components that we use in our products would
adversely affect our business, results of operations and financial condition.
In 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025, our material and
processing costs amounted to RMB9.0 million, RMB71.5 million, RMB257.1 million, RMB185.4
million and RMB312.1 million, respectively. Significant changes in the markets in which we
purchase materials, components, and supplies for our products may adversely affect our
profitability. In the event of any supply shortages or inflationary pressures, we may experience
increases in the cost of our products, and, therefore, our gross margin may decrease, at least in the
short term, as a result of these cost increases. Competitive and market pressures limit our ability to
recover increases in costs through increases in prices we charge to our customers. The inability to
pass on price increases to our customers when raw material or component prices increase rapidly
or are significantly higher than historic levels would adversely affect our business, results of
operations and financial condition.
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RISKS RELATING TO OUR INTELLECTUAL PROPERTY RIGHTS
We may not be able to obtain or maintain adequate intellectual property rights protection for
our product and solution, or the scope of such intellectual property rights protection may not
be sufficiently broad.
Our success depends in a large part on our ability to protect our proprietary technology as
well as our product and solution from competition by obtaining, maintaining and enforcing our
intellectual property rights, including patent rights. We have been protecting the proprietary
technologies that we consider commercially important by, among others, filing patent applications
in the PRC and other jurisdictions. As of the Latest Practicable Date, we owned 362 registered
patents and filed 513 patent applications in the PRC. See “Business — Intellectual Property
Rights.” The patent application process may be expensive and time-consuming, and we may not be
able to file and prosecute all necessary or desirable patent applications at a reasonable cost or in a
timely manner, if at all. In addition, we may however fail to identify patentable aspects of our
R&D outputs before it is too late to obtain patent protection. As a result, we may not be able to
prevent competitors from developing and commercializing competitive products and solutions in
all such fields.
Specifically, patents may be invalidated, and patent applications may not be granted for
several reasons, including known or unknown prior deficiencies in the patent application or the
lack of novelty of the underlying invention or technology. Our patent applications may not be
granted in the end as they involve complex legal and factual considerations. As such, we do not
know the degree of future protection that we will have on our proprietary technologies, if any, and
we may not be able to obtain adequate intellectual property protection with respect to our products
and solutions.
Even if our patent applications issue as patents, they may not issue in a form that will
provide us with any meaningful protection, prevent competitors from competing with us or
otherwise provide us with any competitive advantage. Our competitors may be able to circumvent
our patents by developing similar or alternative technologies or products and solutions in a
non-infringing manner. The issuance of a patent is not conclusive as to its inventor, scope, validity
or enforceability, and our patents may be challenged in the courts or patent offices in the PRC and
other jurisdictions. Further, although various extensions may be available, the life of a patent and
the protection it affords are limited. For example, in the PRC, invention patents and utility model
patents are valid for 20 years and ten years from the date of application, respectively. We may face
competition for any similar products or solutions even if we successfully obtain patent protection
once the patent life has expired for the product or solution. Any of the foregoing could materially
and adversely affect our business, results of operations, financial condition, competitive position
and prospects.
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We may become involved in lawsuits to protect or enforce our intellectual property, which
could be expensive, time-consuming and unsuccessful. Our patent rights relating to our
products and solutions could be found invalid or unenforceable if challenged in court or
before the CNIPA or related intellectual property agencies in other jurisdictions.
Competitors may infringe our patent rights or misappropriate or otherwise violate our
intellectual property rights. To counter infringement or unauthorized use, litigation may be
necessary in the future to enforce or defend our intellectual property rights, to protect our trade
secrets or to determine the validity and scope of our own intellectual property rights or the
proprietary rights of others. This can be expensive and time-consuming. Any claims that we assert
against perceived infringers could also provoke these parties to assert counterclaims against us
alleging that we infringe their intellectual property rights. Many of our current and potential
competitors have the ability to dedicate substantially greater resources to enforce and/or defend
their intellectual property rights than we do. Accordingly, despite our efforts, we may not be able
to prevent third parties from infringing upon or misappropriating our intellectual property. An
adverse result in any litigation proceeding could put our patents, as well as any patents that may
issue in the future from our pending patent applications, at risk of being invalidated, held
unenforceable or interpreted narrowly.
In addition, collaborative relationships in our industry can be complex, particularly with
respect to IP rights. Disputes may arise in the future regarding ownership rights to technology
developed by or with other parties. These and other possible disagreements between us and third
parties with respect to our IP rights or our collaborative relationships could lead to delays in the
research, development or commercialization of our products and solutions. These disputes could
also result in litigation or arbitration, both of which will consume a certain amount of time and
cost.
Furthermore, because of the substantial amount of discovery required in connection with
intellectual property litigation, some of our confidential information could be compromised by
disclosure during this type of litigation. Defendant counterclaims alleging invalidity or
unenforceability are commonplace and can be asserted on numerous grounds. Third parties may
also raise similar claims before administrative bodies in China or abroad, even outside the context
of litigation. Such proceedings could result in revocation or amendment to our patents in such a
way that they no longer cover and protect our products and solutions. The outcome following legal
assertions of invalidity and unenforceability is unpredictable.
If a defendant were to prevail on a legal assertion of invalidity and/or unenforceability, we
would lose at least part, and perhaps all, of the patent protection on our products and solutions or
product and solution candidates. Such a loss of patent protection could materially and adversely
affect our business.
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If third parties claim that we infringe upon their intellectual property rights, we may incur
liabilities and financial penalties and may have to redesign or discontinue selling the products
or solutions involved.
Companies operating in our industries routinely seek patent protection for their product and
solution designs. Some of our competitors have large patent portfolios and may claim that our
expected commercial use of our products or solutions has infringed their patents. These patents
have broad claims, so it might be alleged that certain features of our products or solutions fall
within the claims of such patents. Therefore, our competitors may initiate legal proceedings
alleging that we are infringing, misappropriating or otherwise violating their intellectual property
rights in connection with the commercialization of the relevant products or solutions.
Companies in our industries may use intellectual property litigation to gain a competitive
advantage. Whether a product or solution infringes a patent involves an analysis of complex legal
and factual issues, the determination of which can not be predicted by us accurately. We may hire
employees who have previously worked for our competitors. There can be no assurance that such
employees will not use their previous employers’ proprietary know-how or trade secrets in their
work for us, which could result in litigation against us. Our competitors may also have filed for
patent protection which is not as yet a matter of public knowledge or claim trademark rights that
have not been revealed through our searches of relevant public records. Our efforts to identify and
avoid infringing on third parties’ intellectual property rights may not always be successful. Any
claims of patent or other intellectual property infringement, regardless of their merit, could:
 cost a certain amount of money and time to defend;
 require us to pay substantial damages to third parties;
 forbid us from making or selling products or solutions that incorporate the challenged
intellectual property;
 require us to redesign, reengineer or rebrand our products or solutions;
 require us to enter into royalty or licensing agreements in order to obtain the right to
use a third party’s intellectual property, which agreements may not be available on terms
acceptable to us or at all;
 divert the attention of our management; or
 result in customers terminating, deferring or limiting their purchase of the affected
products until resolution of the litigation.
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In addition, new patents obtained by our competitors could threaten the continued life of the
product or solution in the market even after it has already been introduced.
Obtaining and maintaining our patent protection depends on compliance with various
procedural, documentary, fee payment, and other requirements imposed by governmental
patent agencies, and our patent protection could be reduced or eliminated for non-
compliance with these requirements.
The CNIPA and various governmental patent agencies require compliance with a number of
procedural, documentary, fee payment, and other similar provisions during the patent application
process and over the lifetime of the patent. Non-compliance events, including failure to respond to
official actions within prescribed time limits, non-payment of periodic maintenance fees, and
failure to properly legalize and submit formal documents, can result in abandonment or lapse of
the patent or patent application, leading to partial or complete loss of patent rights in the relevant
jurisdiction. In any such event, our competitors might be able to enter the market, which would
materially and adversely affect our business.
Changes in patent law could diminish the value of patents in general, thereby impairing our
ability to protect our products and solutions.
The scope of patent protection in various jurisdictions is uncertain. Changes in either the
patent laws or their interpretation in the country where we operate or other countries may diminish
our ability to protect our inventions, obtain, maintain, defend, and enforce our intellectual property
rights and, more generally, could affect the value of our intellectual property or narrow the scope
of our patent rights. We cannot predict whether the patent applications we are currently pursuing
and may pursue in the future will issue as patents in any particular jurisdiction or whether the
claims of any future granted patents will provide sufficient protection from competitors. The
coverage claimed in a patent application can be significantly reduced before the patent is issued,
and its scope can be reinterpreted after issuance.
Even if patent applications we own currently or in the future issue as patents, they may not
issue in a form that will provide us with any meaningful protection, prevent competitors or other
third parties from competing with us, or otherwise provide us with any competitive advantage. As
a result, the issuance, scope, validity, enforceability and commercial value of our patent rights are
highly uncertain.
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We may be unable to protect the confidentiality of our trade secrets, and we may be subject
to claims that our employees or third parties have wrongfully used or disclosed alleged trade
secrets owned by others.
In addition to our issued patent and pending patent applications, we rely on trade secrets,
including unpatented know-how, technology and other proprietary information, to protect our
products and solutions and thus maintain our competitive position. We protect these trade secrets,
in part, by entering into non-disclosure and confidentiality agreements, non-compete covenants or
include such undertakings in the agreements with parties that have access to them. Nevertheless,
there can be no guarantee that an employee or a third party will not make an unauthorized use or
disclosure of our proprietary confidential information. This might happen intentionally or
inadvertently. It is possible that a competitor will gain access to such information and make use of
such information, and that our competitive position will be compromised, in spite of any legal
action we might take against persons making such unauthorized disclosures. In addition, to the
extent that our employees or business partners use intellectual property owned by others in their
work for us, disputes may arise as to the rights in related or resulting know-how and inventions.
Trade secrets are difficult to protect. Our employees or business partners might intentionally
or inadvertently disclose our trade secret information to competitors, or our trade secrets may
otherwise be misappropriated. Enforcing a claim that a third party illegally obtained and is using
any of our trade secrets is expensive and time-consuming, and the outcome is unpredictable.
We also seek to enter into agreements with our employees that obligate them to assign to us
any inventions created during their work for us. However, we may not obtain these agreements in
all circumstances and the assignment of intellectual property under such agreements may not be
self-executing. And it is possible that technology relevant to our business will be independently
developed by a person that is not a party to such an agreement. Furthermore, if the employees who
are parties to these agreements breach or violate the terms of these agreements, we may not have
adequate remedies for any such breach or violation, and we could lose our trade secrets and
inventions through such breaches or violations. We may be involved in claims by or against us
related to the ownership of such intellectual property. If we fail in prosecuting or defending any
such claims, in addition to paying monetary damages, we may lose valuable intellectual property
rights. Even if we are successful in prosecuting or defending against such claims, litigation could
result in certain costs and be a distraction to our management and R&D personnel.
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RISKS RELATING TO OUR FINANCIAL CONDITION AND NEED FOR ADDITIONAL
CAPITAL
We may not be able to obtain additional capital when desired, on favorable terms or at all.
We need significant capital to, among other things, conduct research and development for our
intelligent driving technology, attract and retain top talent, launch new intelligent driving vehicle
types, offer more advanced intelligent driving functionalities, maintain and grow our fleet, expand
our customer base and provide quality technical support services. Our capital requirements will be
subject to many factors, including, but not limited to:
 technological advancements;
 market acceptance of our products and solutions and product and solution enhancements,
and the overall level of sales of our products and solutions;
 R&D expenses;
 our relationships with our customers and suppliers;
 our ability to control costs;
 sales and marketing expenses;
 enhancements to our infrastructure and systems and any capital improvements to our
facilities;
 potential acquisitions of businesses and product lines; and
 general economic conditions, inflation, rising interest rates, and international conflicts
and their impact on our industry in particular.
If our capital requirements are materially different from those currently planned, we may
need additional capital sooner than anticipated. Additional financing may not be available on
favorable terms, on a timely basis, or at all. If adequate funds are not available or are not available
on acceptable terms, we may be unable to continue our operations as planned, develop or enhance
our products and solutions, expand our sales and marketing programs, take advantage of future
opportunities, or respond to competitive pressures.
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We have incurred significant operating losses and net losses during the Track Record Period
and may not be able to achieve or subsequently maintain profitability in the near future.
Since our inception, we have incurred net losses. In 2022, 2023, 2024, in the six months
ended June 30, 2024 and 2025, we had loss for the periods of RMB263.0 million, RMB255.1
million, RMB580.8 million, RMB122.6 million and RMB455.1 million, respectively. We may
continue to incur net losses in the short term, as we are in the stage of expanding our business and
operations and are continuously investing in R&D. We may not be able to achieve or subsequently
maintain profitability in the near future. We believe that our future revenue growth will depend on,
among other factors, our ability to develop new technologies, enhance customer experience,
establish effective commercialization strategies, compete effectively and successfully, develop new
products and solutions and successfully maintain and secure additional customers. Accordingly,
you should not rely on the revenues of any prior periods as an indication of our future
performance. We also expect our costs and expenses to increase in future periods as we continue to
expand our business and operation and invest in R&D and geographic expansion. In addition, we
expect to incur substantial costs and expenses as a result of being a public company. If we are
unable to generate adequate revenues and manage our expenses, we may continue to incur
significant losses and may not be able to achieve or subsequently maintain profitability.
We are subject to credit risk related to delay in payment and defaults of customers or related
parties, which would adversely affect our liquidity and financial condition.
We are exposed to credit risk related to delay in payment and defaults of our various
customers or related parties. In addition, in the ordinary course of business, we may be required to
provide various forms of financial assistance such as financial guarantees, direct loans and
extended payment terms and installment arrangements to our customers to secure their orders.
Such arrangements could expose us to heightened credit risk and potential financial losses. One of
customer, Customer K, has been in default with respect to certain payment obligations under its
finance lease agreement with the financial leasing company, the purchase agreement and the
deposit agreement with us. As of the Latest Practicable Date, we have fulfilled our guarantee
obligations of RMB19.2 million in total and still had outstanding guarantee obligations amounting
to RMB50.8 million that have not yet been fulfilled. For the purchase agreement and the deposit
agreement, the overdue amounts from Customer K are RMB1.2 million and RMB5.0 million,
respectively, as of the Latest Practicable Date.
As of December 31, 2022, 2023, 2024 and June 30, 2025, our current trade and notes
receivables amounted to RMB30.8 million, RMB58.7 million, RMB137.4 million and RMB417.9
million, respectively, and our prepayments and other receivables amounted to RMB56.1 million,
RMB90.4 million, RMB117.9 million and RMB160.7 million, respectively. As of December 31,
2022, 2023, 2024 and June 30, 2025, our non-current trade receivables amounted to nil, nil, nil and
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RMB39.9 million. As of December 31, 2023 and 2024 and the six months ended June 30, 2025, we
recorded financial guarantee contracts liabilities of RMB0.2 million, RMB6.5 million and
RMB50.5 million, respectively. In addition, in the ordinary course of business, we may be required
to provide various forms of financial assistance such as financial guarantees, direct loans and
extended payment terms and installment arrangements to our customers to secure their orders.
Such arrangements could expose us to heightened credit risk and potential financial losses. If these
customers delay payment or default on their obligation, we may be required to fulfill guarantee
obligations, write off receivables, or incur impairment losses. We may not be able to collect all
such trade and notes receivables and prepayments and other receivables due to a variety of factors
that are beyond our control, including long project acceptance periods for certain large scale
projects, adverse operating condition or financial condition of customers, and customers’ inability
to pay, among others. We have made and may continue to make impairment provisions and
write-off the relevant receivables if our customers or related parties delay or default in their
payments to us, adversely affecting our liquidity and financial condition.
We had and may continue to have loss-making projects.
In 2022, 2023, 2024 and the six months ended June 30, 2025, we had four, five, four and
three loss-making projects, with gross losses of RMB7.7 million, RMB1.7 million, RMB0.5
million and RMB0.7 million, respectively. These loss-making projects were due to various reasons,
including technical adjustments for new projects, poor customer operations and our competitive
pricing strategy in the face of intensified market competition. We cannot guarantee that we will not
have loss-making projects in the future. These loss-making projects have resulted, and may result,
in the recognition of impairment losses on trade and notes receivables, which may materially and
adversely affect our financial condition, results of operations and prospects.
We may be subject to inventory obsolescence risk.
Our business expansion requires us to manage a large volume of inventory effectively. Our
inventories amounted to RMB123.5 million, RMB174.2 million, RMB96.5 million and RMB170.5
million as of December 31, 2022, 2023, 2024 and June 30, 2025. As of December 31, 2022, 2023,
2024 and June 30, 2025, we recorded inventory provision of RMB7.2 million, RMB19.0 million,
RMB7.7 million and RMB7.7 million, respectively. Our inventories during the Track Record
Period primarily consisted of contract costs in progress, raw materials, finished goods and
consigned-processing-material. Our inventory turnover days decreased from 988.5 days in 2022 to
513.6 days in 2023, 160.1 days in 2024 and further decreased to 71.0 days in the six months ended
June 30, 2025. We cannot guarantee that our inventories can be fully utilized within their effective
lifespan. See “Business — Logistics and Inventory Management — Inventory Management.” As
our business expands, our inventory obsolescence risk may also increase commensurately with the
increase in our inventories and our inventory turnover days.
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We may be exposed to liquidity risk due to a long cash conversion cycle.
We have recorded relatively long inventory turnover days and trade receivable turnover days
during the Track Record Period, which may cause delays in the conversion of our revenue into
cash flows. Our cash conversion cycle, a metric to measure how efficiently we manage our
working capital by tracking the number of days we take to convert our investments in inventory
and other resources into cash flows from sales, was 933.0 days, 495.2 days, 188.2 days and 78.6
days for 2022, 2023, 2024 and the six months ended June 30, 2025, respectively. The cash
conversion cycle is calculated by adding inventory turnover days and trade receivables turnover
days, then subtracting trade payables turnover days. The improvement during the Track Record
Period was primarily attributable to the fact that the decrease in our inventory turnover days and
trade receivables turnover days far exceeded the decrease in trade payables turnover days,
particularly the substantial reduction in inventory turnover days.
Our inventory turnover days was 988.5 days, 513.6 days, 160.1 days and 71.0 days in 2022,
2023, 2024 and the six months ended June 30, 2025. The significant improvement in inventory
turnover days during the same period benefiting from (i) the acceptance of certain V2X projects,
(ii) continuous improvements in inventory management, and (iii) increased sales of our
autonomous mining products and solutions. Our trade receivables turnover days was 244.9 days,
120.2 days, 89.8 days and 121.7 days in 2022, 2023, 2024 and the six months ended June 30,
2025. The overall decreasing trend was primarily attributable to the growth of our business scale
and our enhanced efforts in receivables management. The increase in the six months ended June
30, 2025 was primarily attributable to a higher proportion of receivables recognized during the
period that remained within agreed payment terms. Our trade payables turnover days was 300.4
days, 138.6 days, 61.7 days, and 114.1 days in 2022, 2023, 2024 and the six months ended June
30, 2025. The overall decreasing trend was primarily attributable to the settlement of certain major
projects in the respective period. The increase in the six months ended June 30, 2025 was
primarily attributable to extended credit terms granted by certain suppliers following the expansion
of our business. See “Financial Information — Discussion of Key Items of Consolidated
Statements of Financial Position — Net Current Assets/(Liabilities).”
However, there can be no assurance that similar performance can be sustained in future
periods, particularly in light of potential fluctuations in project acceptance cycle, customer
payment patterns, supply chain volatility, and broader macroeconomic conditions. A long cash
conversion cycle may increase our reliance on working capital or external financing to support our
operations and future growth. Meanwhile, concentration of customers and suppliers may restrict
our ability to negotiate favorable payment terms, potentially resulting in tighter cash flow and
increased liquidity risk. If we are unable to manage our inventory levels and receivables efficiently
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or to secure adequate financing on acceptable terms, our liquidity position may be negatively
impacted, which could in turn materially and adversely affect our business, financial condition and
results of operation.
We are subject to risks associated with certain finance lease arrangements, which may cause
material and adverse effect on our financial condition and operational results.
As part of our sales strategy, we have formed business partnerships with financial leasing
companies to offer our customers alternative financing options, easing their financial constraints
and facilitating the purchase of our solutions. As our business grows, we anticipate an increase in
the use of finance leases by our customers. However, if our partner financial leasing companies are
unable to meet our customers’ capital requirements, those customers may be unable to afford our
solutions and could potentially turn to competitors that can fulfill their financing needs, diverting
our existing clientele and negatively impacting our future business growth.
Additionally, it is common industry practice to offer guarantees in finance lease agreements,
which require us to make payments to the financial leasing companies in the event of a customer
default, exposing us to increased credit risks. See “Business — Customers — Finance Lease
Arrangements.” As of the Latest Practicable Date, one of our customers was in default, and we
fulfilled our obligations under the relevant guarantee as required by the lessor of the finance lease.
See “Business — Customers — Major Customers — Transactions with Customer K.” As of
December 31, 2023 and 2024 and the six months ended June 30, 2025, we recorded financial
guarantee contracts liabilities of RMB0.2 million, RMB6.5 million and RMB50.5 million,
respectively. As of June 30, 2025, the amount of impairment losses made in respect of financial
guarantee contracts with Customer K was RMB50.5 million, representing an impairment ratio of
72.1% for the financial guarantee contract liabilities arising from Customer K. If we cannot
effectively control and manage credit risks related to our guarantees in finance lease agreements,
our financial condition may be materially and adversely affected.
We had net current liabilities, net liabilities and recorded net operating cash outflows
historically, which may continue into the foreseeable future and expose us to liquidity risk.
We had net current liabilities of RMB1,793.2 million as of June 30, 2025, and net liabilities
of RMB601.9 million, RMB857.0 million, RMB1,117.9 million and RMB1,306.2 million as of
December 31, 2022, 2023, 2024 and June 30, 2025, respectively. We may have net current
liabilities and net liabilities in the future. Having significant net current liabilities and net
liabilities could constrain our operational flexibility and adversely affect our ability to expand our
business. A net current liabilities position and a net liabilities position can expose us to the risk of
shortfalls in liquidity, in which case our ability to raise funds, obtain bank loans and declare and
pay dividends will be materially and adversely affected. We recorded net cash used in operating
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activities of RMB203.1 million, RMB196.8 million, RMB147.7 million, RMB42.5 million and
RMB208.2 million in 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025,
respectively. See “Financial Information — Liquidity and Capital Resources — Net Cash Flows
Used in Operating Activities.” We cannot assure you that we will be able to generate positive cash
flows from operating activities in the future. If we continue to record net operating cash outflows
in the future, our working capital may be constrained, which may adversely affect our financial
condition.
Our future liquidity primarily depends on our ability to maintain adequate cash inflows from
our operating activities and adequate external financing such as offering and issuing securities,
and/or other sources such as external debt, which may not be available on terms favorable or
commercially reasonable to us or at all. If we fail to obtain sufficient funding in a timely manner
and on reasonable terms, or at all, we will be in default of our payment obligations and may not be
able to expand our business. Thus, our business, results of operations and financial condition may
be adversely affected.
There are uncertainties about the recoverability of our deferred tax assets, which may affect
our financial condition in the future.
As of December 31, 2022, 2023, 2024 and June 30, 2025, we recognized deferred tax assets
of RMB117.3 million, RMB152.3 million, RMB180.7 million and RMB205.4 million, respectively.
Deferred tax assets are recognized only if it is probable that future taxable amounts will be
available to utilize those temporary differences and losses. While the deferred tax assets may
enable us to reduce future tax payments, our deferred tax assets may also represent a risk to us as
their recoverability depends on our ability to generate sufficient taxable profits. We cannot assure
you that our deferred tax assets can be recovered in the future. In the event that the value of our
deferred tax assets is changed, we may have to write-down the deferred tax assets, which may
materially and adversely affect our financial condition.
Failure to obtain or maintain any of the government grants or preferential tax treatments
could adversely affect our business, results of operations, financial condition and prospects.
During the Track Record Period, we benefited from government grants, many of which are
non-recurring in nature or are subject to periodic review. As of December 31, 2022, 2023, 2024
and June 30, 2025, the government grants we recognized as other income amounted to RMB7.3
million, RMB11.0 million, RMB5.1 million and RMB0.7 million, respectively. In addition, we
enjoy various types of preferential tax treatment according to the prevailing PRC tax laws. For
example, we were recognized as a high and new technology enterprise and were entitled to a
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preferential income tax rate of 15% instead of 25% during the Track Record Period. For more
details of the preferential tax treatments, see Note 13 to the Accountant’s Report in Appendix I to
this Prospectus.
The PRC governmental authorities may, at their discretion, decide to reduce or cancel such
government grants or preferential tax treatment, which could adversely affect our business, results
of operations, financial condition and prospects. As these government grants are provided typically
on a one-off basis, there is no guarantee that we will continue receiving or benefiting from them in
the future. In addition, we may not be able to successfully or timely obtain the government grants
or preferential tax treatment that may become available to us in the future, and such failure could
adversely affect our business, results of operations, financial condition and prospects.
We have granted and may continue to grant share-based awards in the future, which may
result in share-based payment expenses and as a result, may adversely affect our results of
operations and financial condition.
We have granted and may continue to grant share-based awards in the future as we believe
such share-based awards are important to our ability to attract, retain and motivate our key
individuals. As a result, we may incur share-based payment expenses, which may adversely affect
our results of operations and financial condition.
Our property valuation is based on certain assumptions which, by their nature, are subjective
and uncertain and may materially differ from actual results.
Valuations of our selected property interest as of September 30, 2025 prepared by A VISTA
Valuation Advisory Limited, an independent property valuer, are set forth in the valuation report
set out as Appendix III to this prospectus. The valuations are made based on assumptions which,
by their nature, are subjective and uncertain and may differ from actual results. In addition,
changes in general and local economic conditions or other factors beyond our control may affect
the value of our properties. As a result, the valuation of our properties may differ materially from
the price we could receive in an actual sale of the properties in the market and should not be taken
as their actual realizable value or an estimation of their realizable value.
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RISKS RELATING TO OUR GENERAL OPERATIONS
The industries that we operate in are highly competitive. If we fail to compete with our
competitors, our business, results of operations and financial condition may be materially and
adversely affected.
The industries in which we operate are highly competitive and concentrated. In particular,
China’s autonomous mining truck solution market is highly concentrated, with top five market
players accounting for approximately 97% of the market share in terms of revenue in 2024. We
primarily compete with other companies that focus on developing and commercializing intelligent
driving technologies for commercial vehicles. If we compete with players that have a longer
corporate operating history than us, or if we do not have or in the future gain more financial
resources and sophisticated technological capabilities and broader customer base and relationships
than our competitors, we may not be able to respond more quickly and effectively to new or
changing opportunities, technologies, regulatory requirements or user demand than our
competitors.
We may also face competition from new entrants who may offer lower prices or new
technologies, products and solutions, and thus increase the level of competition in the future.
Increased competition could result in lower sales, price reductions, reduced margins or loss of
market share. Further, we may be required to make substantial additional investments in research,
development, marketing and sales, recruiting and retaining top innovative talents, and acquiring
technologies complementary to, or necessary for, our current and future products and solutions in
order to respond to such competitive threats, and we cannot assure you that such measures will be
effective.
If we are unable to compete successfully, or if competing successfully requires us to take
costly actions in response to the actions of our competitors, our business, results of operations and
financial condition may be materially and adversely affected.
We have a limited operating history, which makes it difficult to evaluate our business and
prospects, and our historical growth may not be indicative of our future performance.
We have a limited operating history compared to some of our competitors. Our operations to
date have focused on establishing our intellectual property portfolio and conducting R&D activities
and the commercialization of our product and solution. As a result of our limited operating history,
revenue fluctuations during the Track Record Period and particularly in light of the rapidly
evolving nature of our industries, it may be difficult to evaluate our current business and reliably
predict our future performance. Our historical results may not provide a meaningful basis for
evaluating our business, results of operations, financial condition and prospects, and we may
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encounter unforeseen expenses, difficulties, complications, delays and other known and unknown
factors, and may not be able to achieve promising results in future periods. If we cannot address
these risks and overcome these difficulties successfully, our business and prospects will suffer.
Our success relies on key management and other highly qualified personnel with specialized
skills. If we are unable to attract, retain and motivate key individuals, our business, results of
operations and financial condition would be materially and adversely affected.
Hiring and retaining key individuals, such as key management, technical staff, qualified
executives, developers, engineers and sales representatives are critical to our business, in
particular, to the R&D and commercialization of each of our products and solutions. As of June
30, 2025, our R&D team consisted of 249 members, representing 54.1% of our total employees. In
particular, our key R&D personnel are integral to the advancement of our technology and
development of our products and solutions. See “Business — Research and Development — R&D
Team.” If our key R&D personnel were to cease their relationship with us or develop relationships
with competitors, our ability to develop new technologies and products may be materially and
adversely affected. The competition for highly skilled employees in our industries is increasingly
intense. Changes in our management team would also disrupt our business. Our management and
senior leadership team has significant industry experience, and their knowledge and relationships
would be difficult to replace. See “Directors and Senior Management.”
Changes in our management team may occur from time to time, and we cannot predict
whether significant resignations will occur or whether we will be able to recruit qualified
personnel. In addition, changes in the interpretation and application of employment-related laws to
our workforce practices may result in increased operating costs and less flexibility in how we meet
our changing workforce needs. See “Regulatory Overview — Laws and Regulations Relating to
Labor Protection, Social Insurance and Housing Provident Fund.” We may experience difficulty in
hiring employees with appropriate qualifications. Many of the companies with which we compete
for experienced personnel may have greater resources than we have and may offer more attractive
compensation packages for new employees. If we hire employees from competitors or other
companies, their former employers may attempt to assert that these employees have breached their
legal obligations, resulting in a diversion of our time and resources and potentially in litigation.
Our employee hiring and retention also depend on our ability to build and maintain a diverse and
inclusive workplace culture and be viewed as an employer of choice. If our share-based or other
compensation programs and workplace culture cease to be viewed as competitive, our ability to
attract, retain, and motivate key individuals would be weakened, which would in turn materially
and adversely affect our business, results of operations and financial condition.
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Our development strategies may not succeed, which may materially and adversely affect our
business, financial condition and results of operations.
We have implemented comprehensive business strategies, including developing new
technologies and expanding our operations. We have been and will continue introducing new
products and solutions and improving existing ones to meet market demand and customer needs.
However, there can be no assurance that our strategies align with market development, including
technological advancements, industry trends and customer preferences. If any of our business
strategies are proven to deviate from such market development, it could have a negative impact on
our business, financial condition and results of operations. In addition, we may fail to obtain the
necessary resources to fund our future plans or employ suitable personnel to manage our expanded
business. If we are unable to develop and introduce new solutions and improve existing solutions
in a cost-effective and timely manner, our business, financial condition, results of operations and
competitive position would be materially and adversely affected.
Our international strategy and ability to conduct business in international markets may be
adversely affected by legal, regulatory, political and economic risks.
International expansion is a significant component of our growth strategy and may require
significant capital investment in the future, which could strain our resources and adversely affect
current performance, while adding complexity to our current operations. We will be subject to
legal and regulatory requirements, political uncertainty and social, environmental and economic
conditions in the overseas jurisdictions where we operate, including markets in which we generate
significant sales. Our operations in such jurisdictions may create risks relating to organizing local
operating entities; establishing, staffing and managing foreign business locations; attracting local
customers; navigating foreign government taxes, regulations and permit requirements;
enforceability of our contractual rights; trade restrictions, customs regulations, data privacy
compliance, tariffs and price or exchange controls; and preferences in foreign nations for
domestically manufactured products. If any of our overseas operations, or our associates or agents,
violate laws in the relevant jurisdictions, we could become subject to sanctions or other penalties,
which could adversely affect our reputation, business, results of operations and financial condition.
Acquisitions, investments or strategic alliances may fail and materially and adversely affect
our reputation, business and results of operations.
We may in the future enter into strategic alliances with various third parties. Strategic
alliances with third parties could subject us to a number of risks, including risks associated with
sharing proprietary information, non-performance by the counterparty and an increase in expenses
incurred in establishing new strategic alliances, any of which may materially and adversely affect
our business. We may have little ability to control or monitor their actions and to the extent that
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strategic third parties suffer negative publicity or harm to their reputation from events relating to
their business, we may also suffer negative publicity or harm to our reputation by virtue of our
association with such third parties.
In addition, we may acquire additional assets, technologies or businesses that are
complementary to our existing business. Future acquisitions and the subsequent integration of new
assets and businesses into our own would require significant attention from our management and
could result in a diversion of resources from our existing business, which, in turn, could adversely
affect our business. Acquired assets or businesses may not generate the financial or results of
operations we expect. In addition, acquisitions could result in the 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.
Our failure to address these risks or other problems encountered in connection with our future
acquisitions and investments could cause us to fail to realize the anticipated benefits of such
acquisitions or investments, incur unanticipated liabilities and expenses and harm our business
generally. If we use our equity securities to pay for acquisitions or investments, we may dilute the
value of our Shares. If we borrow funds to finance acquisitions or investments, such debt
instruments may contain restrictive covenants that could, among other things, restrict us from
distributing dividends. Such acquisitions and investments may also lead to significant amortization
expenses related to intangible assets, impairment charges or write-offs. Moreover, the costs of
identifying and consummating acquisitions may be significant. In addition to possible
shareholders’ approval, we may also have to obtain approvals and licenses from government
authorities for the acquisitions and comply with applicable laws and regulations, which could
result in increased costs and delays.
Our information technology networks and systems may encounter malfunction, unexpected
system failure, interruption, insufficiency or security breaches.
We rely on information technology networks and systems for electronic communications
among our personnel, customers, manufacturers and suppliers and for synchronization with our
manufacturers and logistics providers on demand forecast, order placements and manufacturing
and service status and capacity. These information technology systems, some of which are
managed by third parties, may be susceptible to damage, disruptions or shutdowns due to failures
during the process of upgrading or replacing software, databases or components, power outages,
hardware failures, computer viruses, attacks by computer hackers, telecommunication failures, user
errors or catastrophic events. If our information technology systems suffer damage, disruption or
shutdown, we may incur substantial costs in repairing or replacing these systems. Failures in
information technology systems, especially those related to automotive safety and associated data,
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could potentially lead to problems with our products and solutions, resulting in physical injuries or
even fatalities to drivers, passengers, and other individuals. If we do not effectively resolve the
issues in a timely manner, our business, results of operations and financial condition may be
materially and adversely affected, and we could experience delays in reporting our financial
results.
Our operations require continuous attention to the evolution of regulatory requirements. If
we are unable to adapt to changes in automotive safety regulations, our operational and
financial prospects could be significantly impacted.
We operate in regulated industries and are required to comply with the applicable laws, rules
and regulations governing our operations. See “Regulatory Overview — Regulations and Policies
Relating to the Autonomous Driving and Intelligent Connected Vehicle Industry.” For details of
our internal control measures to monitor and ensure compliance, see “Business — Risk
Management and Internal Control — Compliance Management.” Given a certain degree of
discretionary authority held by relevant PRC authorities in interpreting, implementing and
enforcing relevant rules and regulations, as well as other factors beyond our control, we cannot
guarantee you that we have obtained or will be able to obtain and maintain all requisite licenses,
permits, filings and registrations. Among other types of regulations, safety regulations play an
important role in our operations. These regulations often impose stringent compliance and
reporting requirements and are subject to evolvement due to new technological data, adverse
publicity regarding industry recalls and safety risks of intelligent driving. If the manufacturing, use
and sale of our products fail to meet the conditions or requirements of the new regulations that
will be applicable at that time, our business, operating results and financial condition may be
materially and adversely affected accordingly.
If we are unable to adapt to new legislation or changes in regulatory requirements, as well as
changes or evolution in court interpretation of those regulations with respect to the industry of
solutions for automotive intelligence, our business may be adversely affected. We need to
continuously monitor laws, regulations and relevant compliance procedures to ensure that we are
in compliance with existing laws and regulations in each market where we operate. Given the
potential changes in the nature and complexity of relevant laws and regulations, we may need to
incur higher compliance costs. If we are not currently in compliance with existing regulations, or
if we fail to adhere to new regulations or fail to continually keep abreast of updates to such
regulations, we may incur costs in remedying our non-compliance and it may disrupt our
operations. In addition, we have no control over our products being resold or used by our
customers in jurisdictions where our products are deemed incompliant with relevant laws and
regulations, which could result in damage to our brand and adversely affect our business, results of
operations and financial condition.
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If we fail to obtain and maintain the requisite licenses and approvals required in any
jurisdiction where we operate our business, results of operation and financial condition may
be materially and adversely affected.
The industries we operate in are highly regulated. For example, under the current PRC
regulatory scheme, a number of governmental authorities, including, but not limited to, SAMR and
MIIT, jointly regulate major aspects of our industries. We are also required to obtain and maintain
the requisite licenses and approvals required in the jurisdictions where we operate our business.
In addition, for the purpose of conducting the research and development in the ordinary
course of our business and also for the purposes of performing contracts with our customers, we
are cooperating with a service provider with surveying and mapping qualifications. Our
cooperation scope covers the conduction of activities that requires qualification in order to
facilitate our research and development and business operations. The service provider is
responsible for providing solutions for the transmission, storage, use, and other processing
activities of the geospatial data. However, if our cooperation with such service provider cannot
continue or we cannot reach cooperation with other qualified service providers in the market, we
may be subject to the requirement of obtaining surveying and mapping qualification certificate and
complying with the state’s surveying and mapping criteria, there is no assurance that we will be
able to meet such criteria in a timely manner or at all, and our research and development activities
and collaboration with our customers might be affected, any of which may materially and
adversely affect our business, financial condition and results of operations.
As confirmed by our PRC Legal Advisor, as of the Latest Practicable Date, we had obtained
all the licenses and made all the filings with competent governmental authorities in all material
aspects that are essential to the operation of our business in China. However, we cannot assure you
that we can successfully update or renew the licenses required for our business in a timely manner
or that these licenses are sufficient to conduct all of our present or future business. We cannot
assure you that we will be able to continuously comply with any future laws, regulations and
policies or any of the laws, regulations and policies currently in effect due to changes in the
relevant authorities’ interpretation of these laws, regulations and policies. New laws and
regulations may also be enforced from time to time to require additional licenses and permits other
than those we currently have. We cannot assure you that we will be able to obtain such licenses
and permits in a timely and cost-effective manner. If we fail to complete, obtain or maintain any of
the required licenses or approvals or make the necessary filings in any of the jurisdiction where we
operate our business, we may be subject to various penalties, such as confiscation of the revenue
that were generated through the unlicensed activities, the imposition of fines and the
discontinuation or restriction of our operations. Any such penalties may disrupt our business
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operations and materially and adversely affect our business, results of operations and financial
condition. For further details on the requisite licenses and approvals for our business operations,
see “Regulatory Overview.”
We may be subject to risks associated with international trade policies, investment
restrictions, geopolitics and trade protection measures, including imposition of trade
restrictions and sanctions, and our reputation, business, results of operations and financial
condition could be adversely affected.
Our operations are subject to deterioration in political and economic relations among countries and
sanctions and export and import controls administered by the government authorities in the countries
where we operate and where our technologies originate from, and other geopolitical challenges, including,
but not limited to, economic and labor conditions, increased duties, taxes and other costs and political
instability. Margins on sales of our products and services in certain countries and on sales of products that
include components obtained from certain foreign suppliers could be materially and adversely affected by
international trade regulations, including duties, tariffs and antidumping penalties. In particular, the U.S.
government imposed economic and trade sanctions directly or indirectly affecting China-based technology
companies. In addition to the existing trade sanctions and tariffs, the U.S. government may implement
additional export and import controls and other regulatory measures targeting China-based technology
companies. Such laws and regulations are likely subject to frequent changes, and their interpretation and
enforcement involves substantial uncertainties, which may be heightened by national security concerns or
driven by political and/or other factors that are beyond our control. See “Regulatory Overview — Laws
and Regulations relating to U.S. Export and Import Controls.” If certain of our customers and suppliers
are listed on the Entity List and subject to restrictions on sourcing or selling technologies, software, or
products from/to us, there is no guarantee that we will be able to obtain as well as extend and maintain
the requisite regulatory permits in relation to our transactions with these customers and suppliers, or that
such permits will cover all our existing and potential transactions with such customers and suppliers. We
cannot be certain what additional export control actions the U.S. government may take that could impact
our products, suppliers or customers. The U.S. government could further expand the scope of items
subject to the EAR in a manner that captures our products. Additional actions could also take the form of
additional designations on the Entity List, which could make our products subject to the EAR for certain
transactions if involving those parties. Furthermore, other countries may continue to adopt export controls
that could impact our products and operations. The aforementioned restrictions, and similar or more
expansive restrictions or sanctions, including sanctions currently imposed or may be imposed in the future
by the Office of Foreign Assets Control of the United States or other relevant authorities in other
jurisdictions, may materially and adversely affect our customers’ and suppliers’ ability to acquire or use
technologies, systems, software, devices or components that may be critical to their products, service
offerings and business operations, which in turn may adversely affect our business, results of operations
and financial condition. Therefore, such restrictions, and similar or more expansive restrictions that may
be imposed by the U.S. or other jurisdictions in the future, may be difficult or costly to comply with and
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may materially and adversely affect our and our technology partners’ abilities to acquire technologies,
systems, devices or components that may be critical to our technology infrastructure, service offerings and
business operations. If any of us, or our Shareholders, Directors, management personnel, employees and
business partners, violate such laws, we could become subject to sanctions or other penalties, which could
adversely affect our reputation, business, results of operations and financial condition.
Other countries may also consider adopting similar trade restrictions or policies that may
affect our ability to conduct import and export activities. As a result, our business, financial health,
and operational performance could be negatively impacted by new sanctions, export controls, or
other trade-related measures.
On August 9, 2023, the Biden administration signed an executive order and an advanced
notice of proposed rule-making providing a conceptual framework for outbound investment
controls focused on China, including Hong Kong and Macau. On October 28, 2024, the U.S.
Department of Treasury issued a final rule to implement the executive order of August 9, 2023 (the
“Final Rule ”). The Final Rule became effective on January 2, 2025. The Final Rule imposes
investment prohibition and notification requirements on U.S. persons for certain investments in
entities associated with China (including Hong Kong and Macau) that are engaged in activities
relating to three sectors: (i) semiconductors and microelectronics, (ii) quantum information
technologies, and (iii) artificial intelligence systems, collectively defined as “covered activities.”
U.S. persons subject to the Final Rule are prohibited from making, or required to report, certain
investments in a “covered foreign person,” which are defined as “covered transactions,” and
include acquisitions of equity interests and contingent equity interests, certain debt financing,
greenfield and brownfield investments, joint ventures, and certain investments as a limited partner
in a non-U.S. person pooled investment fund. The Final Rule excludes some investments from the
scope of “covered transactions”, including those in publicly traded securities. We may be deemed a
“covered foreign person” defined under the Final Rule because we may be deemed to be engaged
in the development of AI systems intended to be used for the control of robotic systems, which
constitutes “covered activities” under the Final Rule. If U.S. persons engage in a “covered
transaction” (as defined under the Final Rule), including a transaction that involves the acquisition
of our equity interests that are not publicly traded, such U.S. persons may need to make a
notification to the U.S. Department of Treasury pursuant to the Final Rule. In addition, even
though U.S. persons’ acquisitions of certain publicly traded securities (such as our Shares
following the completion of the Listing) will be exempted from the scope of “covered
transactions” under the Final Rule, the Final Rule could still limit our ability to raise capital or
contingent equity capital from U.S. investors after the Listing given that relevant laws, regulations,
and policies continue to evolve, and there could be amendments to publicly traded securities
exemption and other aspects of the Final Rule or the introduction of similar regulations. If our
ability to raise such capital is significantly and negatively affected, it could be detrimental to our
business, financial condition and prospects.
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Our business growth and results of operations may be affected by changes in global and
regional macroeconomic conditions, natural disasters, health epidemics and pandemics, and
social disruption and other outbreaks.
Economic and industry uncertainty or changes, including recession or slowing growth,
inflation, changes or uncertainty in fiscal, monetary, or trade policy, disruptions to capital markets,
currency fluctuations, higher interest rates, tighter credit, lower capital expenditures by businesses,
including on IT infrastructure, increases in unemployment, labor shortages, and lower consumer
confidence and spending. In addition, natural disasters such as floods, earthquakes, sandstorms,
snowstorms, fire or drought or the outbreak of a widespread health epidemic or any severe
epidemic disease such as SARS, Ebola, Zika or COVID-19, and force majeure events including
acts of war or terrorism may disrupt our R&D, manufacturing and commercialization activities and
business operations, all of which could adversely affect our business, results of operations,
financial condition and prospects.
Our insurance coverage may not be sufficient to cover all losses or potential claims by our
customers which would affect our business, results of operations and financial condition.
We maintain insurance coverage which includes property all risks insurance for our buildings,
machinery and equipment and third-party liability insurance for our test vehicles. While we believe
that the amount of our insurance coverage is in line with the customary standard in the industry
and is adequate for our operations, it may not be adequate to fully compensate for all kinds of
losses we may suffer in the future. For example, insurance covering losses from acts of war,
terrorism, or natural disasters is either unavailable or cost-prohibitive. In addition, our insurers
review our policies every year and we cannot guarantee that our policies can be renewed on
similar or other acceptable terms or at all. Our current insurance coverage may not be sufficient to
prevent us from suffering any loss and there is no certainty that we will be able to successfully
claim our losses under our current insurance policy on a timely basis, or at all. Furthermore, if we
suffer unexpected severe losses or losses that far exceed the policy limits, it could materially and
adversely affect our business, results of operations, financial condition and prospects.
Our business and prospects depend on our ability to build our brands and reputation, which
could be harmed by negative publicity with respect to any negative publicity regarding our
Company, Directors, employees, branding or products and solutions, whether warranted or
not, could adversely affect our business.
We believe that maintaining and enhancing our brands are of significant importance to the
success of our business. Well-recognized brands are important to enhancing our attractiveness to
our customers. Since we operate in a highly competitive market, brand maintenance and
enhancement directly affect our ability to maintain our market position. The successful promotion
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of our brand will depend on the effectiveness of our marketing efforts and the amount of
word-of-mouth referrals we receive from satisfied customers. We may incur extra expenses in
promoting our brand. However, we cannot assure you that these activities are and will be
successful or that we can achieve the brand promotion effect we expect. In addition, negative
publicity about our Company, Directors, employees, branding or products and solutions, whether
warranted or not, may adversely affect our brand, reputation and business. Certain of such negative
publicity may come from malicious harassment or unfair competition acts by third parties, which
are beyond our control.
Issues relating to the responsible use of our technologies, including AI in our offerings, may
result in reputational and financial harm and liability.
Concerns relating to the responsible use of new and evolving technologies, such as AI, in our
products and services may result in reputational and financial harm and liability and may cause us
to incur costs to resolve such issues. We are increasingly building AI capabilities into many of our
products and services. AI poses emerging ethical issues and presents risks and challenges that
could affect its adoption, and therefore our business. If we enable or offer solutions that draw
controversy due to their perceived or actual impact on society, such as AI solutions that have
unintended consequences or are controversial because of their impact on human rights, privacy,
employment, or other social, economic, or political issues, or if we are unable to develop effective
internal policies and frameworks relating to the responsible development and use of AI models and
systems offered through our sales channels, we may experience brand or reputational harm,
competitive harm or legal liability. Compliance with government regulation in the area of AI ethics
may also increase the cost of related research and development, and changes in AI-related
regulation could disproportionately impact us and require us to change our business practices,
which may negatively impact our financial results. Our failure to address concerns relating to the
responsible use of AI by us or others could undermine public confidence in AI and slow adoption
of AI in our products and services or cause reputational harm.
Any failure or perceived failure to comply with data privacy and security laws, or other
concerns about our practices or policies with respect to the collection, use, storage, retention,
transfer, disclosure, and other processing of data, could damage our reputation and deter
current and potential customers from using our products and solutions.
In recent years, privacy and data protection has become an increasing regulatory focus of
government authorities across the world. The PRC government has enacted a series of laws,
regulations and governmental policies for the protection of personal data in the past few years. We
are subject to a variety of laws and regulations relating to data security and privacy, as our
business operations involve collection, use, storage, retention, transfer, disclosure and other
processing of data, and procurement of data from third parties for training purpose. The
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interpretation and application of laws, regulations and standards relating to cybersecurity, data
protection and privacy are still subject to change, and these regulations are also affected by
different interpretations or significant changes, making it difficult for us to anticipate the scope of
our responsibilities in this regard. For instance, on June 10, 2021, the Standing Committee of the
National People’s Congress promulgated the Data Security Law of the People’s Republic of China
() (the “Data Security Law,” effective since September 1, 2021).
The Data Security Law sets out a number of obligations on data security and privacy undertaken
by entities and individuals engaged in data-related activities. It also prohibits any individual or
entity in China from providing data stored in China to foreign judicial or law enforcement
departments without the approval of the competent authorities in China. Besides, the Measures on
Security Assessment of Cross-border Data Transfer (), which was
promulgated by Cyberspace Administration of China on July 7, 2022 and became effective on
September 1, 2022, stipulates the obligation that before applying for the security assessment of
outbound data transfer, data processors shall conduct a self-assessment of the risks in the outbound
data transfer. And on November 7, 2016, the Standing Committee of the National People’s
Congress promulgated the Cybersecurity Law of the People’s Republic of China ( ʕശɛ͏΍ձ
, effective since June 1, 2017), and pursuant to which, the state is to advance the
development of a socialized service system for cybersecurity, and encourage related businesses and
institutions to carry out cybersecurity services such as certification, testing and risk assessment.
According to the Measures for Cybersecurity Review (), which was
promulgated by the Cyberspace Administration of China, the National Development and Reform
Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security,
the Ministry of State Security, the Ministry of Finance, the Ministry of Commerce, the People’s
Bank of China, the State Administration for Market Regulation, the National Radio and Television
Administration, the National Administration of State Secrets Protection, and the State
Cryptography Administration on December 28, 2021 and became effective on February 15, 2022,
entities meeting certain standards shall apply for a cybersecurity review. Meanwhile, the
Regulation on Network Data Security Management ( ၣഖᅰኽτΌ၍ଣૢԷ), which was
promulgated by the State Council on September 24, 2024 and came into effect on January 1, 2025,
further provides rules on network data security. As advised by our PRC legal adviser as to data
security laws, the cybersecurity related laws and regulations would not have a material adverse
impact on our business operations or the Global Offering as of the Latest Practicable Date. While
we strive to comply with our privacy guidelines as well as all applicable data protection laws and
regulations, any failure or perceived failure to comply may result in proceedings or actions against
us by government entities or others, and could damage our reputation.
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Failure to detect or prevent fraudulent or illegal activities or other misconduct by our
employees, customers, suppliers or other third parties may materially and adversely affect
our business.
We are exposed to fraudulent or illegal activities or other misconduct by our employees,
customers, suppliers or other third parties, that could subject us to liabilities, fines and other
penalties imposed by government authorities and negative publicity. There can be no assurance
that our controls and policies will prevent fraud or illegal activity by such persons or that similar
incidents will not occur in the future. Any illegal, fraudulent, corrupt or collusive activity by our
employees, customers, suppliers or other third parties, including, but not limited to, those in
violation of anti-corruption or anti-bribery laws, could subject us to negative publicity that could
severely damage our brand and reputation and, if conducted by our employees, could further
subject us to significant financial and other liabilities to third parties and fines and other penalties
imposed by government authorities. Accordingly, our failure to detect and prevent fraudulent or
illegal activities or other misconduct by our employees, customers, suppliers or other third parties
could materially and adversely affect our business, results of operations, financial condition and
prospects.
Our legal right to some leased properties may be challenged.
As of the Latest Practicable Date, the lessor of one of our leased properties was unable to
provide us with their property ownership certificates and construction permits, which may
adversely affect our ability to continue to use them in the future. As the property is used as
garages and warehouses that only accounts for a relatively small portion of the aggregate gross
floor area of our leased properties, we believe that we will be able to find alternative properties
easily if we are required to relocate. Nonetheless, we may incur additional expenses during the
process, and our business, financial condition and results of operations may be negatively affected.
In addition, as of the Latest Practicable Date, we were unable to complete the registration and
filing procedures for the above-mentioned leased property because the lessor was unable to
complete their property ownership registration. As advised by our PRC Legal Advisor, the
non-registration and filing of the relevant property lease will not affect the validity of the lease
contracts and the legal use of the leased properties, but relevant local housing authorities may
require us to complete the filing within the prescribed period and we may be subject to penalties
of RMB1,000 to RMB10,000 for non-registration exceeding such time limit.
As of the Latest Practicable Date, we were not subject to any investigation or administrative
penalties by the relevant government authorities, nor subject to any legal proceeding or arbitration
in relation to the above-mentioned issues.
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If we fail to comply with environmental, fire protection or health and safety laws and
regulations, we could become subject to fines or penalties or incur costs that could have a
material adverse effect on the success of our business.
We are subject to numerous environmental, fire protection, or health and safety laws and
regulations. Our assembly and testing processes involve machinery and equipment that may be
prone to industrial accidents, potentially causing physical injuries to, or even fatalities of, our
employees. There can be no assurance that industrial accidents, whether caused by malfunction or
misuse of equipment or machinery, will not occur in the future. In such event, we may be liable to
claims brought against us by injured employees or their families in cases of fatalities. We may also
be subject to fines or penalties for violations of applicable health and safety laws and regulations
by government authorities if our measures for health and safety protection are found to be
insufficient, as well as suspension of our operations for investigation after such incidents. In
addition, we may also need to continuously improve and implement new health and safety
requirements to prevent the recurrence of such incidents in the future.
We have been in compliance with such laws and regulations in all material aspects during the
Track Record Period and up to the Latest Practicable Date. However, compliance with such laws
and regulations incurs certain costs. Any potential failure to comply with environmental, fire
protection, or health and safety laws and regulations and/or failure to adequately protect the health
of our employees could have a material and adverse impact on our business operations and
financial performance.
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 may be involved in legal proceedings and commercial or contractual disputes in the
ordinary course of our business. For example, a construction service supplier filed a lawsuit
against us due to disagreements over payment settlement terms and procedures in relation to a
construction project for our self-operated factory. The dispute is ongoing and no court judgment
had been issued as of the Latest Practicable Date, and the court imposed pre-litigation property
preservation measures in relation to one of our properties and bank accounts. See “Business —
Legal Proceedings and Compliance” for details. This litigation arose from the ordinary course of
our operations and does not concern our core business or assets, and we have made sufficient
provisions for the disputed amount. We believe and our PRC Legal Advisors are of the view that
such dispute would not have a material adverse impact on our business operations. We cannot
assure you that we will not be involved in various legal and other disputes in the future, which
may expose us to additional risks and losses. In addition, we may have to pay legal costs
associated with such disputes, including fees relating to appraisal, auction, execution and legal
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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 core business. If our business is disrupted as a result of judgment, arbitration and legal
proceedings against us or adverse adjudications in proceedings against our Directors, senior
management or key employees, it may materially and adversely affect our reputation, business,
results of operations, financial condition and prospects.
RISKS RELATING TO CONDUCTING BUSINESS IN THE PLACE WHERE WE OPERATE
Failure to respond to development in the economic, government policies, and laws and
regulations in the principal place where we operate may have a material adverse effect on
our business, financial condition and results of operations.
Our business, financial condition and operating result may be influenced by the overall
political, economic and social conditions in the countries where we operate.
Governments around the world have implemented and may continue to introduce various
policies and measures aimed at encouraging economic growth and guiding resource allocation.
These economic measures may be adaptively adjusted from industry to industry or across different
regions. Failure to respond to such development may materially and adversely affect our business.
We may be subject to the approval, filing or other requirements of the CSRC or other PRC
governmental authorities in connection with capital raising activities.
On July 6, 2021, the relevant PRC government authorities issued Opinions on Strictly
Cracking Down Illegal Securities Activities in Accordance with the Law (੽ᘌ͂ᏘᗇՎ
จԈ). These opinions enhanced administration and supervision on overseas listings
by China-based companies and proposed to take effective measures, such as promoting the
construction of relevant regulatory systems to deal with the risks and incidents faced by
China-based overseas-listed companies. See “Regulatory Overview — Laws and Regulations
Relating to Overseas Listing.”
If it is determined that our future financing activities or other significant events require any
filings with the CSRC or other regulatory authorities or the fulfillment of other requirements, and
we fail to complete such filings or meet such requirements in a timely manner, such failure may
adversely affect our ability to finance the development of our business and may have a material
adverse effect on our business and financial condition.
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Y ou may experience difficulties in effecting service of legal process and enforcing judgments
against us and our management.
We are a company incorporated under the laws of the PRC, and substantially all of our
business, assets and operations are located in Mainland China. In addition, a majority of our
Directors or members of our senior management reside in Mainland China, and a substantial
portion of the assets of such Directors or members of our senior management are located in
Mainland China. As a result, it may be difficult, cumbersome, and time-consuming to effect
service of process outside Mainland China upon us or such Directors or members of our senior
management. Furthermore, an original action may only be brought in China against us or our
Directors and senior management if the actions are not required to be arbitrated by the PRC laws
and upon satisfaction of the conditions for commencing a cause of action pursuant to the PRC civil
procedure law, therefore, you are advised to pay attention to whether you are able to bring an
original action in China in this manner. Moreover, Mainland China has not entered into a treaty for
the reciprocal recognition and enforcement of court judgments with many countries including the
United States. In addition, Hong Kong has no arrangement with the United States for reciprocal
enforcement of judgments. As a result, recognition and enforcement in Mainland China or Hong
Kong of a court judgment obtained in the United States and any of the other jurisdictions
mentioned above may be difficult or impossible.
On July 14, 2006, the Supreme People’s Court of China and Hong Kong entered into the
Arrangement on Reciprocal Recognition and Enforcement of Judgements in Civil and Commercial
Matters by the Courts of the Mainland and of the Hong Kong Special Administrative Region
Pursuant to Choice of Court Agreements between Parties Concerned (݁
τર ) (the “ 2006 Arrangement ”).
Pursuant to such arrangement, a party with a final judgment rendered by a Hong Kong court
requiring payment of money in a civil and commercial case according to a choice of court
agreement in writing may apply for recognition and enforcement of the judgment in China, and
vice versa. However, it is subject to the parties in the dispute agreeing to enter into a choice of
court agreement in writing under the 2006 Arrangement. On January 18, 2019, the Supreme
People’s Court of China and Hong Kong entered into the Arrangement on Reciprocal Recognition
and Enforcement of Judgments in Civil and Commercial Matters by the Courts of the Mainland
and of the Hong Kong Special Administrative Region (ʝႩ̙
τર) (the “ 2019 Arrangement ”), which took effect in January 2024.
The 2019 Arrangement superseded the 2006 Arrangement and afforded greater clarity and certainty
for reciprocal recognition and enforcement of judgments in civil and commercial matters. The
2006 Arrangement will remain applicable to a “choice of court agreement in writing” entered into
before the 2019 Arrangement taking effect.
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Although we will be subject to the Hong Kong Listing Rules and the Hong Kong Codes on
Takeovers and Mergers and Share Repurchases upon the listing of our H Shares on the Hong Kong
Stock Exchange, the holders of H Shares will not be able to bring actions on the basis of
violations of the Hong Kong Listing Rules and must rely on the Hong Kong Stock Exchange to
enforce its rules. The Hong Kong Listing Rules and Hong Kong Codes on Takeovers and Mergers
and Share Repurchases do not have the force of law in Hong Kong.
Regulations and policies regarding currency exchange, as well as fluctuations in exchange
rates may impact our ability to distribute dividends and our operating result.
The conversion and remittance of foreign currencies are subject to PRC foreign exchange
regulations. As we may convert our revenue in Renminbi into other currencies to meet our foreign
currency obligations, such as payments of dividends on our Shares, there is no assurance that we
will have sufficient foreign exchange to meet these requirements. 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 SAFE approval by complying with certain procedural requirements.
However, if we cannot continuously comply with the applicable foreign exchange regulations and
policies, we may not be able to obtain sufficient foreign currency, which may in turn affect our
ability to pay dividends to our Shareholders in foreign currency.
Fluctuations in the exchange rate of Renminbi against the Hong Kong dollar, the U.S. dollar
and other foreign currencies are affected by, among other things, the policies of the PRC
Government and changes in China’s and international political and economic conditions. The
proceeds from the Global Offering will be denominated in Hong Kong dollars. As a result, any
appreciation of Renminbi against the U.S. dollar, the Hong Kong dollar or any other foreign
currencies may result in a decrease in the value of our foreign currency-denominated assets and
our proceeds from the Global Offering. Conversely, any depreciation of Renminbi may adversely
affect the value of, and any dividends payable on our H Shares in foreign currencies. There are
limited instruments currently available for us to reduce our foreign currency risk exposure at
reasonable cost, and we have not utilized, and may not in the future utilize, any such instrument.
All of these factors could materially and adversely affect our business, results of operations,
financial condition and prospects, and could reduce the value of, and dividends payable on, our H
Shares in foreign currency terms.
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Holders of our H Shares may be subject to PRC income tax on dividends from us or on any
gain realized on the transfer of our H Shares.
As is customary with all major economies, China has tax treaties or similar arrangements
with jurisdictions across the world. Under the EIT Law and its implementation rules, and subject
to any applicable tax treaty or similar arrangement between China and your jurisdiction of
residence that provides for a different income tax arrangement, PRC withholding tax at the rate of
10% is normally applicable to dividends from PRC sources payable to investors that are resident
enterprises outside of the PRC, which do not have an establishment or place of business in the
PRC, or which have such establishment or place of business if the relevant income is not
effectively connected with the establishment or place of business. Any gain realized on the transfer
of shares by such investors is subject to 10% (or a lower rate) PRC income tax if such gain is
regarded as income derived from sources within the PRC unless a treaty or similar arrangement
otherwise provides. Under the Individual Income Tax Law of the People’s Republic of China ( ʕ
) and its implementation rules, dividends from sources within the
PRC paid to foreign individual investors who are not residents in the PRC are generally subject to
a PRC withholding tax at a rate of 20% and gains from PRC sources realized by such investors on
the transfer of shares are generally subject to 20% PRC income tax, in each case, subject to any
reduction or exemption set forth in applicable tax treaties and PRC laws. Although our business
operations are in China, it is unclear whether dividends we pay with respect to our H Shares, or
the gain realized from the transfer of our H Shares, would be treated as income derived from
sources within the PRC and as a result be subject to PRC income tax. If PRC income tax is
imposed on gains realized through the transfer of our H Shares or on dividends paid to our
non-resident investors, the value of your investment in our Shares may be adversely affected.
Furthermore, our Shareholders whose jurisdictions of residence have tax treaties or arrangements
with the PRC may not qualify for benefits under such tax treaties or arrangements.
Payment of dividends is subject to the provisions under PRC laws.
Under the PRC laws, dividends may be paid only out of distributable profits. Our
distributable profits represent our distributable net profits less appropriations to statutory surplus
reserve, general reserve, and discretionary surplus reserve (as approved by our Shareholders’
meeting), each such appropriation based on the unconsolidated net profit determined under PRC
GAAP. Our distributable net profit referred to above represents the lowest of (i) our net profit
attributable to our equity holders for a period plus distributable profits or net of accumulated
losses, if any, at the beginning of such period, as determined under PRC GAAP, and (ii) our net
profit attributable to our equity holders for the period plus distributable profits or net of
accumulated losses, if any, at the beginning of such period, as determined under IFRS. As a result,
we may not have sufficient distributable profits, if any, to make dividend distributions to our
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Shareholders in the future, including in respect of periods where we register an accounting profit.
Any distributable profits that are not distributed in a given year are retained and available for
distribution in subsequent years.
RISKS RELATING TO THE GLOBAL OFFERING
There has been no prior public trading market for our H shares, and their liquidity and
market price may be volatile.
Prior to the Global Offering, there was no public market for our H Shares. We cannot assure
you that a public market for our H Shares with adequate liquidity and trading volume will develop
and be sustained following the completion of Global Offering. In addition, the Offer Price of our
H Shares may not be an indication 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 could be
materially and adversely affected.
The price and trading volume of our H Shares may be highly volatile. Several factors, some
of which are beyond our control, such as variations in our results of operations, changes in our
pricing policy, the emergence of new technologies, strategic alliances or acquisitions, the addition
or departure of key personnel, changes in profit forecast or recommendations by financial analysts,
changes in ratings by credit rating agencies, litigation or the removal of the restrictions on share
transactions, could cause large and sudden changes to the volume and price at which our H Shares
will trade.
Substantial future sales or the expectation of substantial sale of our H Shares in the public
market could cause the price of our H Shares to decline.
Although our Controlling Shareholders are subject to restrictions on their sales of H Shares
within 12 months from the Listing Date as described in “Underwriting” in this prospectus, future
sales of a significant number of our H Shares by our Controlling Shareholders or other existing
shareholders in the public market after the Global Offering, or the perception that these sales could
occur, could cause the market price of our H Shares to decline and could materially impair our
future ability to raise capital through offerings of our H Shares. We cannot assure you that our
Controlling Shareholders, or other existing shareholders will not dispose of H Shares held by them
or that we will not issue H Shares pursuant to the general mandate to issue shares granted to our
Directors, upon the expiration of restrictions set out above. We cannot predict the effect, if any,
that any future sales of Shares by our Controlling Shareholders or other existing Shareholders, or
the Shares available for sale by our Controlling Shareholders or other existing Shareholders, or the
issuance of Shares by our Company may have on the market price of the H Shares. Sale or
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issuance of a substantial number of Shares by our Controlling Shareholders or us, or the market
perception that such sale or issuance may occur, could materially and adversely affect the
prevailing market price of the H Shares.
We may need additional capital, and the sale or issue of additional H Shares or other equity
securities could result in additional dilution to our Shareholders.
Notwithstanding our current cash and cash equivalents and the net proceeds from the Global
Offering, we may require additional cash resources to finance our continued growth or other future
developments. We cannot assure you that financing will be available in the amounts or on terms
acceptable to us, if at all. If we fail to raise additional funds, we may need to sell additional equity
securities, which could result in additional dilution to our Shareholders.
As the Offer Price of our H Shares is higher than our consolidated net tangible book value
per Share, purchasers of our H Shares in the Global Offering may experience immediate
dilution upon such purchases.
As the Offer Price of our H Shares is higher than the consolidated net tangible assets per
Share immediately prior to the Global Offering, purchasers of our H Shares in the Global Offering
may experience an immediate dilution. Our existing Shareholders will receive an increase in the
pro forma adjusted consolidated net tangible asset value per Share of their H Shares. In addition,
holders of our H Shares may experience further dilution of their interest if the Underwriters
exercise the Over-allotment Option or if we issue additional H Shares in the future to raise
additional capital.
We cannot assure you whether and when we will declare and pay dividends in the future.
We may not be able to pay any cash dividends in the foreseeable future. Our ability to pay
dividends will depend on various factors, including whether we are able to generate sufficient
earnings. Distribution of dividends shall be decided by our Board of Directors at their discretion
and will be subject to the corporate approval processes. A decision to declare or to pay dividends
and the amount thereof depend on various factors, including but not limited to our results of
operations, cash flows and financial position, operating and capital expenditure requirements,
distributable profits as determined under PRC GAAP or IFRS, our Articles of Association and
other constitutional documents, the PRC Company Law and any other applicable PRC laws and
regulations, market conditions, our strategy and projection for our business, contractual restrictions
and obligations, taxation, regulatory provisions and any other factors from time to time deemed by
our Board of Directors as relevant to the declaration or suspension of dividends. As a result, there
RISK FACTORS
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can be no assurance whether, when and in what form we will pay dividends in the future. Subject
to any of the above constraints, we may not be able to pay dividends in accordance with our
dividend policy. See “Financial Information — Dividends.”
Certain facts, forecasts and statistics contained in this prospectus are derived from a
third-party report and publicly available official sources and they may not be reliable.
Certain facts, forecasts and statistics contained in this prospectus relating to, among other
things, the industry in which we operate have been derived from a third-party report and various
official government publications. However, we have not independently verified information and
statistics from official government sources, and we cannot assure you of the quality or reliability
of such source materials. Information from official government sources have not been prepared or
independently verified by us, the Underwriters or any of their respective affiliates or advisors and,
therefore, we make no representation as to the accuracy of such statistics. Due to possibly flawed
or ineffective collection methods or discrepancies between published information and market
practice, such statistics in this prospectus may be inaccurate or may not be comparable to statistics
produced with respect to other economies. In all cases, investors should give consideration as to
how much weight or importance they should attach to or place on such facts.
Forward-looking statements contained in this prospectus are subject to risks and
uncertainties.
This prospectus contains certain statements and information that are forward-looking and uses
forward-looking terminology such as “believe,” “expect,” “estimate,” “predict,” “aim,” “intend,”
“will,” “may,” “plan,” “consider,” “anticipate,” “seek,” “should,” “could,” “would,” “continue,”
and other similar expressions. You are cautioned that reliance on any forward- looking statement
involves risks and uncertainties and that any or all of those assumptions could prove to be
inaccurate and as a result, the forward-looking statements based on those assumptions could also
be incorrect. In light of these and other risks and uncertainties, the inclusion of forward-looking
statements in this prospectus should not be regarded as representations or warranties by us that our
plans and objectives will be achieved, and these forward-looking statements should be considered
in light of various important factors, including those set forth in this section. Subject to the
requirements of the Listing Rules, we do not intend publicly to update or otherwise revise the
forward-looking statements in this prospectus, whether as a result of new information, future
events or otherwise. Accordingly, you should not place undue reliance on any forward-looking
information. All forward-looking statements in this prospectus are qualified by reference to this
cautionary statement.
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Investors should read the entire prospectus carefully and should not consider any particular
statements in this prospectus or in published media reports without carefully considering the
risks and other information contained in this prospectus.
Prior to the publication of this prospectus, there has been coverage in the media regarding us
and the Global Offering, which contained among other things, certain financial information,
projections, valuations and other forward-looking information about us and the Global Offering.
We have not authorized the disclosure of any such information in the press or media and do not
accept any responsibility for the accuracy or completeness of such media coverage or
forward-looking statements. We make no representation as to the appropriateness, accuracy,
completeness or reliability of any information disseminated in the media. We disclaim any
information in the media to the extent that such information is inconsistent or conflicts with the
information contained in this prospectus. Accordingly, prospective investors are cautioned to make
their investment decisions on the basis of the information contained in this prospectus only and
should not rely on any other information.
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In preparation for the Listing, we have sought the following waivers and exemption from
strict compliance with certain provisions of the Listing Rules.
W AIVER IN RESPECT OF MANAGEMENT PRESENCE IN HONG KONG
Pursuant to Rule 8.12 of the Listing Rules, our Company must have sufficient management
presence in Hong Kong. This normally means that at least two of our executive Directors must be
ordinarily resident in Hong Kong. Rule 19A.15 of the Listing Rules further provides that
requirement in Rule 8.12 may be waived by having regard to, among other considerations, our
arrangements for maintaining regular communication with the Stock Exchange.
Our principal business operations are primarily located, managed, and conducted in the PRC
and will continue to be based in the PRC, and our Company’s head office is located in Changsha,
the PRC. Our executive Directors and senior management members ordinarily reside in the PRC
and play important roles in our Company’s business operations, principally responsible for the
overall management, corporate strategy, planning, business development and control of our
Group’s business, it is important for them to remain in close proximity to the Group’s operations
located in the PRC. We consider that it would be practically difficult and commercially
unreasonable for us to arrange for two executive Directors to be ordinarily resident in Hong Kong,
either by relocation of our existing executive Directors or by appointment of additional executive
Directors. For the above reasons, we do not have, and do not contemplate in the foreseeable future
that we will have, sufficient management presence in Hong Kong for the purpose of satisfying the
requirements under Rule 8.12 of the Listing Rules.
Accordingly, pursuant to Rule 19A.15 of the Listing Rules, we have applied to the Stock
Exchange for, and the Stock Exchange has granted us, a waiver from strict compliance with the
requirements set out in Rule 8.12 of the Listing Rules subject to the following conditions:
(i) we have appointed Dr. Hu Albert Sibo (౶௹) and Mr. Li Chunlin (؍݆a st h e
authorized representatives of our Company (the “ Authorized Representatives ”) for
purpose of Rule 3.05 of the Listing Rules. The Authorized Representatives will act as
our Company’s principal channel of communication with the Stock Exchange and will
be readily contactable by phone, facsimile and email to deal promptly with enquiries
from the Stock Exchange. Our Company will provide contact details of the Authorized
Representatives to the Stock Exchange and will inform the Stock Exchange as soon as
practicable in respect of any changes in Authorized Representatives. Accordingly, our
Authorized Representatives will be able to meet with the relevant members of the Stock
Exchange to discuss any matters in relation to our Company within a reasonable period
of time. See “Directors and Senior Management” for further biographical details of our
Authorized Representatives;
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(ii) when the Stock Exchange wishes to contact our Directors on any matter, each of the
Authorized Representatives will have means for contacting all Directors promptly at all
times as and when the Exchange wishes to contact the Directors on any matters;
(iii) to the best of our knowledge and information, 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 upon request by
the Stock Exchange; and
(iv) our Company has appointed Gram Capital Limited as our Compliance Advisor with
effect from the Listing in accordance with Rule 3A.19 of the Listing Rules. The
Compliance Advisor will, among other things and in addition to the Authorized
Representatives, provide us with professional advice on continuing obligations under the
Listing Rules and act as additional channel of communication of the Company with the
Stock Exchange during the period from the Listing Date to the date on which the
Company complies with Rule 13.46 of the Listing Rules in respect of our financial
results for the first full financial year immediately after the Listing. The Compliance
Advisor will act as the additional and alternative channel of communication with the
Stock Exchange and its representatives will be readily available to answer enquiries
from the Stock Exchange; and
(v) to facilitate communication with the Stock Exchange, we have provided our Authorized
Representatives and the Stock Exchange with the contact details (including mobile
phone number, office phone number, email address and fax numbers (if any)) of each of
our Directors.
W AIVER IN RESPECT OF APPOINTMENT OF JOINT COMPANY SECRETARIES
Pursuant to Rules 3.28 and 8.17 of the Listing Rules, we must appoint a company secretary
who, by virtue of his/her 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:
(i) a member of The Hong Kong Chartered Governance Institute;
(ii) a solicitor or barrister (as defined in the Legal Practitioners Ordinance (Chapter 159 of
the Laws of Hong Kong)); and
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(iii) a certified public accountant (as defined in the Professional Accountants Ordinance
(Chapter 50 of the Laws of Hong Kong)).
In addition, pursuant to Note 2 to Rule 3.28 of the Listing Rules, the Stock Exchange will
consider the following factors in assessing the individual’s “relevant experience”:
(i) length of employment with the issuer and other issuers and the roles he/she played;
(ii) familiarity with the Listing Rules and other relevant law and regulations including the
Securities and Futures Ordinance, the Companies Ordinance, the Companies (Winding
Up and Miscellaneous Provisions) Ordinance and the Takeovers Code;
(iii) relevant training taken and/or to be taken in addition to the minimum requirement under
Rule 3.29 of the Listing Rules; and
(iv) professional qualifications in other jurisdictions.
Pursuant to Chapter 3.10 of the Guide for New Listing Applicants, the waiver under Rule
3.28 of the Listing Rules will be granted for a fixed period of time but in any event not exceeding
three years from the date of listing and on the following conditions: (i) the relevant company
secretary must be assisted by a person who possesses the qualifications or experience as required
under Rule 3.28 of the Listing Rules and is appointed as joint company secretary throughout the
waiver period; and (ii) the waiver can be revoked in the event of a material breach of the Listing
Rules by the Company.
We have appointed Ms. Au Wing Sze ( ਜ൘་)( “ Ms. Au ”) and Mr. Li Chunlin (؍݆)
“(Mr. Li ”) as the joint company secretaries of our Company. See “Directors and Senior
Management Joint Company Secretaries” for further biographical details of Ms. Au and Mr. Li.
Ms. Au is an associate member of both The Hong Kong Chartered Governance Institute and
The Chartered Governance Institute in the United Kingdom. She fully meets the qualification
requirements stipulated under Rule 3.28 of the Listing Rules and is in compliance with Rule 8.17
of the Listing Rules.
Mr. Li has served as the legal director and head of risk control of our Company since
November 2017 and has been responsible for corporate governance affairs of our Company since
then. By virtue of Mr. Li’s substantial experience in corporate governance and his experience and
familiarity with our Group, we believe that appointment of Mr. Li as our company secretary would
be beneficial for our Company. Furthermore, given that the key operations of our Group are
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located in the PRC, we believe that it would be in the interest of our Company and our corporate
governance to have Mr. Li, who possess the relevant background and experience in the PRC, to act
as our joint company secretary.
While Mr. Li does not possess the qualifications required of a company secretary under Rule
3.28 of the Listing Rules, we have applied to the Stock Exchange for, and the Stock Exchange has
granted us with, a waiver from strict compliance with the requirements under Rules 3.28 and 8.17
of the Listing Rules such that Mr. Li will act as our joint company secretary. The waiver has been
granted for a three-year period commencing from the Listing Date (the “ Waiver Period ”o nt h e
conditions that:
(i) Mr. Li will be assisted by Ms. Au, a joint company secretary of our Company, who
possesses the qualifications or experience as required Rule 3.28 of the Listing Rules and
is appointed as a joint company of our Company throughout the Waiver Period; and
(ii) the waiver will be revoked immediately if Ms. Au, during the Waiver Period, ceases to
provide assistance to Mr. Li, or there are material breaches of the Listing Rules by the
Company.
Furthermore, the below arrangements will be in place in connection with the waiver:
(i) Mr. Li will attend relevant training courses to enhance his knowledge of the Listing
Rules during the Waiver Period, and comply with the annual professional training
requirement under Rule 3.29 of the Listing Rules;
(ii) Ms. Au is suitably qualified person render assistance to Mr. Li so as to enable him to
acquire the relevant experience (as required under Rule 3.28 of the Listing Rules)
during the Waiver Period; and
(iii) before the expiry of the Waiver Period, our Company will evaluate and demonstrate to
the Stock Exchange that he has acquired the relevant experience required under Rule
3.28 of the Listing Rules, and whether ongoing assistance should be arranged so that
Mr. Li’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 Mr. Li, having benefited from the assistance of
Ms. Au 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.
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CONSENT UNDER PARAGRAPH 1C(2) OF APPENDIX F1 TO THE LISTING RULES IN
RESPECT OF SUBSCRIPTIONS OF OFFER SHARES BY CLOSE ASSOCIATES OF
EXISTING SHAREHOLDER AS CORNERSTONE INVESTORS
Paragraph 1C(2) of Appendix F1 to the Listing Rules provides, inter alia, that no allocations
will be permitted to applicant’s existing shareholders or their close associates, whether in their
own names or through nominees unless the conditions set out in Rules 10.03 and 10.04 are
fulfilled, without the prior written consent of the Stock Exchange.
Chapter 2.5 of the Guide provides that (i) given the likely significant funding needs of
Specialist Technology Companies (as defined under Chapter 18C of the Listing Rules) and the
importance of existing shareholders in meeting the funding needs of these companies, existing
shareholders and/or its close associates may participate in the initial public offering (“ IPO”) of a
Specialist Technology Company provided that the applicant complies with MB Rules
8.08(1)/19A.13A, 18C.08 and 8.08A/19A.13C. An existing shareholder holding 10% or more of the
shares in the Specialist Technology Company prior to IPO must subscribe for shares in the IPO as
a cornerstone investor; and an existing shareholder holding less than 10% of the shares in the
Specialist Technology Company prior to IPO may subscribe for shares in the IPO as either a
cornerstone investor or a placee. In the case of subscription as a placee, the applicant and its
sponsors must confirm that no preference in allocation was given to the existing shareholder; and
in the case of subscription as a cornerstone investor, the applicant and its sponsors must confirm
that no preference was given to the existing shareholder other than the preferential treatment of
assured entitlement at the IPO price and the terms are substantially the same as other cornerstone
investors.
As further described in the section headed “Cornerstone Investors” in this prospectus, Hunan
Xiangjiang Zhicheng Industrial Investment Fund Partnership (Limited Partnership) (ಱϪ౽ᒹ
ΥྫΆุ (Υྫ)) (“ Xiangjiang Zhicheng ”) has entered into a cornerstone
investment agreement as a cornerstone investor (“ Cornerstone Investor ”) with the Company, the
Joint Sponsors, and the Overall Coordinators to subscribe for the Offer Shares through its
wholly-owned subsidiary, Xiangjiang Autonomous Driving Industry Investment Co., Limited
incorporated in Hong Kong. The general partner of Xiangjiang Zhicheng is Hunan Guochuang
Industrial Investment Co., Ltd. (ʮ̡ )( “ Hunan Guochuang ”), which is a
wholly-owned subsidiary of Xiangjiang Investment.
Xiangjiang Investment and Xiangjiang Intelligent Innovation are the Company’s existing
shareholders. Xiangjiang Investment is wholly owned by State-owned Assets Supervision and
Administration Commission of Changsha Municipal People’s Government (਷Ϟ༟
ึ )( “ Changsha SASAC ”), which is an independent third party. The general
partner of Xiangjiang Intelligent Innovation is Hunan Guochuang. Please refer to “History,
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Development and Corporate Structure — Information relating to our key Pre-IPO Investors — (f)
Xiangjiang State Investment (being Xiangjiang Investment and Xiangjiang Intelligent Innovation)”
for further information. Xiangjiang Investment and Xiangjiang Intelligent Innovation collectively
hold 2.77% of the Domestic Unlisted Shares in the Company as of the Latest Practicable Date and
2.36% of total issued share capital of the Company immediately following the completion of the
Global Offering (assuming the Over-allotment Option is not exercised).
As Hunan Guochuang is the general partner for both Xiangjiang Zhicheng and Xiangjiang
Intelligent Innovation and each of Xiangjiang Zhicheng, Xiangjiang Investment and Xiangjiang
Intelligent Innovation is ultimately wholly owned by Changsha SASAC, Xiangjiang Zhicheng is a
close associate of the Company’s existing shareholders Xiangjiang Investment and Xiangjiang
Intelligent Innovation.
We have applied for a consent under paragraph 1C(2) of Appendix F1 to the Listing Rules, to
permit Xiangjiang Zhicheng to participate as Cornerstone Investor in the Global Offering to
subscribe for the Offer Shares to be issued by the Company under the International Offering. The
Stock Exchange has agreed to grant the requested consent subject to the conditions that:
(a) the Company will comply with the public float requirements of Rules 19A.13A and
18C.08 of the Listing Rules and the free float requirements of Rule 19A.13C of the
Listing Rules;
(b) the Company and the Joint Sponsors confirm that no preferential treatment has been, nor
will be directly or indirectly, given to Xiangjiang Zhicheng as a cornerstone investor by
virtue of its relationship with the Company in any allocation in the Global Offering,
other than the preferential treatment of assured entitlement under the cornerstone
investment at the Offer Price and the terms are substantially the same as other
cornerstone investors; and
(c) details of the subscription of the Offer Shares by Xiangjiang Zhicheng as Cornerstone
Investor under the Global Offering are disclosed in this prospectus, and details of the
allocation will be disclosed in the allotment results announcement of our Company. For
further information about the relevant cornerstone investments, please refer to the
section headed “Cornerstone Investors” in this prospectus.
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CONSENT IN RESPECT OF THE PROPOSED SUBSCRIPTION OF OFFER SHARES BY
CONNECTED CLIENTS
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 Stock
Exchange.
Paragraph 1B 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.
As described in the section headed “Cornerstone Investors” in this prospectus, each of ICBC
UBS Asset Management Co., (International) Ltd. (༟ପ၍ଣ (਷ყ)ʮ̡)
(“ICBCUBSI ”) and ICBC UBS Asset Management Co., Ltd. (ʮ̡ )
(“ICBCUBS ”) has entered into cornerstone investment agreement with the Company, the Joint
Sponsors, and the Overall Coordinators to subscribe for the Offer Shares. ICBCUBSI and
ICBCUBS are members of the same group of companies as ICBC International Securities Limited
(“ICBCI ”). As ICBCI is one of the Distributors, each of ICBCUBSI and ICBCUBS therefore is a
“connected client” of ICBCI for the purpose of paragraph 1B(7) of Appendix F1 to the Listing
Rules.
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 ICBCUBSI and ICBCUBS to participate in the
Global Offering as Cornerstone Investors 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 ICBCUBSI and ICBCUBS will be held on behalf of
independent third parties on discretionary basis;
(b) ICBCI has not participated, and will not participate, in the decision-making process or
relevant discussions among the Company, the Underwriters and the Overall Coordinators
as to whether Offer Shares will be allocated to ICBCUBSI and ICBCUBS;
(c) no preferential treatment has been, nor will be, given to ICBCUBSI and ICBCUBS by
virtue of their relationship with ICBCI in any allocation of Offer Shares in the
International Offering as cornerstone investors other than the assured entitlement under
the relevant cornerstone investment agreements following the principles set out in
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Chapter 4.15 of the Guide that the cornerstone investment agreements of ICBCUBSI and
ICBCUBS do not contain any material terms which are more favorable to them than
those in the other cornerstone investment agreements;
(d) Each of ICBCUBSI and ICBCUBS confirms that to the best of its knowledge and belief,
it has not received and will not receive any preferential treatment in the Global Offering
allocation as a cornerstone investor by virtue of their relationship with ICBCI, other
than the preferential treatment of assured entitlement under the cornerstone investment;
(e) each of the Company, the Overall Coordinators, ICBCUBSI, ICBCUBS and ICBCI has
provided the Stock Exchange with written confirmations in accordance with Chapter
4.15 of the Guide; and
(f) details of the cornerstone investments and details of the allocations will be disclosed in
this prospectus and the allotment results announcement of our Company.
For further information about the relevant cornerstone investments, please refer to the section
headed “Cornerstone Investors” in this prospectus.
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DIRECTORS’ RESPONSIBILITY FOR THE CONTENTS OF THIS PROSPECTUS
This prospectus, for which our Directors collectively and individually accept full
responsibility, includes particulars given in compliance with the 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 to the public with regard to our Group. Our Directors, having made all reasonable
enquiries, confirm that to the best of their knowledge and belief, the information contained in this
prospectus is accurate and complete in all material respects and not misleading or deceptive, and
there are no other matters the omission of which would make any statement herein or this
prospectus misleading.
CSRC APPROV AL
On October 29, 2025, the CSRC has issued a notification on our Company’ completion of the
PRC filing procedures for the listing of our H Shares on the Stock Exchange and the Global
Offering. As advised by our PRC Legal Advisor, our Company has completed all necessary filings
with the CSRC in the PRC in relation to the Global Offering and the Listing.
UNDERWRITING AND 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 270,400 H Shares initially offered and the International Offering of 5,137,580 H
Shares initially offered (subject, in each case, to reallocation on the basis under the section headed
“Structure of the Global Offering” in this prospectus) and, in case of the International Offering, to
any exercise of the Over-allotment Option.
The Listing of our H Shares on the Stock Exchange is sponsored by the Joint Sponsors and
the Global Offering is managed by the Overall Coordinators. Pursuant to the Hong Kong
Underwriting Agreement, the Hong Kong Public Offering is fully underwritten by the Hong Kong
Underwriters on a conditional basis. The International Offering is expected to be fully
underwritten by the International Underwriters pursuant to the terms of the International
Underwriting Agreement which is expected to be entered into on or about December 17, 2025.
Further details of the Underwriters and the underwriting arrangements are set out in the section
headed “Underwriting” in this prospectus.
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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 the
Company, the Joint Sponsors, the Sponsor-Overall Coordinators, the Joint Global Coordinators, the
Joint Lead Managers, the Joint Bookrunners, the Capital Market Intermediaries, the Underwriters,
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.
Details of the structure of the Global Offering (including its conditions) and the arrangements
relating to the Over-allotment Option and stabilization, are set out in the section headed “Structure
of the Global Offering” and “Underwriting” in this prospectus, and the procedures for applying for
the Hong Kong Offer Shares are set out in “How to Apply for Hong Kong Offer Shares” of this
prospectus.
RESTRICTIONS ON OFFER AND SALE OF THE OFFER SHARES
Each person acquiring the Hong Kong Offer Shares under the Hong Kong Public Offering
will be required to confirm, or be deemed by his acquisition of the Hong Kong Offer Shares to
confirm, that he is aware of the restrictions on offers and sales of the Hong Kong Offer Shares in
this prospectus.
No action has been taken to permit a public offering of the Offer Shares in any jurisdiction
other than Hong Kong, or the distribution of this prospectus in any jurisdiction other than Hong
Kong. Accordingly, this prospectus may not be used for the purpose of, and does not constitute, an
offer or invitation for subscription in any jurisdiction or in any circumstances in which such an
offer or invitation for subscription 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 Hong Kong Offer Shares have not been publicly offered, directly or
indirectly, in the PRC or the United States.
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APPLICATION FOR LISTING ON THE STOCK EXCHANGE
We have applied to the Listing Committee 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) and the H Shares to be
converted from Domestic Unlisted Shares, on the basis that, among other things, we satisfy the
requirements under Rule 18C.03 of the Listing Rules as a Commercial Company (as defined in the
Listing Rules) with reference to our expected market capitalization at the time of Listing, which
based on the Offer Price, exceeds HK$4 billion. Dealings in the H Shares on the Hong Kong Stock
Exchange are expected to commence on Friday, December 19, 2025. Except as otherwise disclosed
in this prospectus, no part of our H Shares or Domestic Unlisted Shares is listed on or dealt in on
any other stock exchange, and no such listing or permission to list is being or proposed to be
sought in the near future.
The H Shares will be traded in board lot of 10 H Shares. The stock code of the H Shares is
3881.
Under section 44B(1) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, if the listing of, and permission to deal in, the H Shares on the Stock Exchange is
refused before the expiration of three weeks from the date of the closing of the application lists, or
such longer period (not exceeding six weeks) as may, within the said three weeks, be notified to
the Company by or on behalf of the Stock Exchange, then any allotment made on an application in
pursuance of this prospectus shall, whenever made, be void.
COMPLIANCE WITH LISTING RULES
We will comply with applicable laws and regulations in Hong Kong (including the Listing
Rules) and any other undertakings which have been given in favor of the Hong Kong Stock
Exchange from time to time. If the Listing Committee finds that there has been a breach by us of
the Listing Rules or such other undertakings which may have been given by us in favor of the
Hong Kong Stock Exchange from time to time, the Listing Committee may instigate cancelation or
disciplinary proceedings in accordance with the Listing Rules.
INFORMATION ON THE CONVERSION OF DOMESTIC UNLISTED SHARES INTO H
SHARES
Our Company has applied for conversion of certain Domestic Unlisted Shares into H Shares,
which involves 37,035,912 Domestic Unlisted Shares held by the existing Shareholders. See
“History, Development and Corporate Structure” and “Share Capital” for details of our existing
Shareholders and their respective interests in our Company and relevant procedures for the
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conversion of certain Domestic Unlisted Shares into H Shares. Such H Shares to be converted
from Domestic Unlisted Shares are restricted from trading for a period of one year after the
Listing. The relevant filing procedure in relation to the conversion of certain Domestic Unlisted
Shares into H Shares has been completed on October 29, 2025.
H SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
Subject to the granting of listing of, and permission to deal in, our H Shares on the Hong
Kong Stock Exchange and our compliance with the stock admission requirements of HKSCC, our
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 our H Shares on the Hong
Kong Stock Exchange or any other date as HKSCC chooses. Settlement of any transactions
between participants of the Hong Kong Stock Exchange is required to take place in CCASS on the
second settlement day after any trading day. All activities under CCASS are subject to the General
Rules of HKSCC and HKSCC Operational Procedures in effect from time to time. Investors should
seek the advice of their stockbroker or other professional advisers for details of the settlement
arrangements as such arrangements may affect their rights and interests. All necessary
arrangements have been made for our H Shares to be admitted into CCASS.
H SHARE REGISTER OF MEMBERS AND HONG KONG STAMP DUTY
All of the H Shares issued pursuant to applications made in the Hong Kong Public Offering
will be registered on our H Share register of members to be maintained in Hong Kong by our H
Share Registrar, Tricor Investor Services Limited. Our principal register of members will be
maintained by us at our head office in the PRC.
Dealings in the H Shares registered in our H Share register of members will be subject to
Hong Kong stamp duty.
Unless otherwise determined by our Board, dividends will be paid to Shareholders whose
names are listed on our H Share register of members in Hong Kong, by ordinary post, at the
Shareholders’ risk in Hong Kong dollars to the registered address of each Shareholder.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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REGISTRATION OF SUBSCRIPTION, PURCHASE AND TRANSFER OF H SHARES
We have instructed the H Share Registrar, and the H Share Registrar has agreed, not to
register the subscription, purchase or transfer of any H Shares in the name of any particular holder
unless the holder delivers a signed form to the H Share Registrar in respect of those H Shares
bearing statements to the effect that the holder:
(a) agrees with us and each of the Shareholders, and we agree with each Shareholder, to
observe and comply with the PRC Company Law and our Articles of Association;
(b) agrees with us, each of our Shareholders, Directors, managers and officers, and we,
acting for ourselves and for each of our Directors, managers and officers agree with
each Shareholder, to refer all differences and claims arising from our Articles of
Association or any rights or obligations conferred or imposed by the PRC Company
Law or other relevant laws and administrative regulations concerning our affairs to
arbitration, and where applicable, in accordance with our Articles of Association, and
any reference to arbitration shall be deemed to authorize the arbitration tribunal to
conduct hearings in open session and to publish its award, which shall be final and
conclusive;
(c) agrees with us and each of our Shareholders that our H Shares are freely transferable by
the holders of our H Shares; and
(d) authorizes us to enter into a contract on his or her behalf with each of our Directors,
managers and officers whereby such Directors, managers and officers undertake to
observe and comply with their obligations to our Shareholders as stipulated in our
Articles of Association.
PROFESSIONAL TAX ADVICE RECOMMENDED
Potential investors in the Global Offering are recommended to consult their professional
advisers as to the taxation implications of subscribing for, purchasing, holding or disposal of,
and/or dealing in the H Shares or exercising rights attached to them. It is emphasized that none of
us, the Joint Sponsors, the Sponsor-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, agents or representatives or any other person or
party involved in the Global Offering accepts responsibility for any tax effects on, or liabilities of,
any person resulting from the subscription, purchase, holding, disposal of, or dealing in, the H
Shares or exercising any rights attached to them.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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OVER-ALLOTMENT OPTION AND STABILIZATION
Details of the arrangements relating to the Over-Allotment Option and stabilization are set
out under the sections headed “Underwriting” and “Structure of the Global Offering” in this
prospectus.
PROCEDURES FOR APPLICATION FOR HONG KONG OFFER SHARES
The procedures for applying for Hong Kong Offer Shares are set out in “How to Apply for
the Hong Kong Offer Shares” in this prospectus.
STRUCTURE OF THE GLOBAL OFFERING
Details of the structure of the Global Offering, including its conditions, are set out in
“Structure of the Global Offering” in this prospectus.
LANGUAGE
If there is any inconsistency between this prospectus and the Chinese translation of this
prospectus, the English version of this prospectus shall prevail. However, the translated English
names of PRC nationals, entities, departments, facilities, certificates, titles, laws, regulations
(including the Company’s subsidiaries) and the like included in this prospectus and for which no
official English translation exists are unofficial translations for your reference only. If there is any
inconsistency, the Chinese name prevails.
ROUNDING
Certain amounts and percentage figures, such as share ownership and operating data, included
in this prospectus may have been subject to rounding adjustments, or have been rounded to one or
two decimal places. Accordingly, figures shown as totals in certain tables may not be an arithmetic
aggregation of the figures preceding them.
EXCHANGE RATE CONVERSION
Solely for your convenience, this prospectus contains translations among certain amounts
denominated in Renminbi, Hong Kong dollars and U.S. dollars. Unless otherwise specified, (a) the
conversion between RMB and Hong Kong dollars in this prospectus have been made at the rate of
RMB0.9088:HK$1.00, being the exchange rate published by the PBOC for foreign exchange
transactions prevailing on the Latest Practicable Date; (b) the conversion between Hong Kong
dollars and U.S. dollars was made at the rate of HK$7.7898 to US$1.00, being the exchange rate
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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calculated based on the exchange rates of RMB to HK$ and RMB to US$ published by the PBOC
for foreign exchange transactions prevailing on the Latest Practicable Date; and (c) the translation
between Renminbi and U.S. dollars was made at the rate of RMB7.0794 to US$1.00, being the
exchange rate published by the PBOC for foreign exchange transactions prevailing on the Latest
Practicable Date. No representation is made that any amounts in RMB or Hong Kong denominated
in one currency can be or could have been at the relevant dates converted at the above rate or any
other rates or at all.
MARKET SHARE DATA CONVENTION
The statistical and market share information contained in this prospectus has been derived
from official government publications and other sources, including information or data provided by
China Insights Industry Consultancy Limited. Unless otherwise indicated, the information has not
been verified by us independently. This statistical information may not be consistent with other
statistical information from other sources within or outside the PRC. While reasonable caution has
been made in the process of reproducing the data and statistics extracted from such official
government publications or other sources, our Company, the Joint Sponsors, the Sponsor-Overall
Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the
Capital Market Intermediaries, the Underwriters, any of our and their respective directors,
supervisors, officers, representatives, employees, advisers or any other persons or parties involved
in the Global Offering make no representation to the appropriateness, accuracy, completeness or
reliability of any such statistical and market share information.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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For further information on our Directors, please refer to the section headed “Directors
and Senior Management” of this prospectus.
DIRECTORS
Name Address Nationality
Executive Directors
Dr. Ma Wei ( ৵ᐂ) Room 1402, Building 1
No. 39 Shenjia Road, Yuelu District
Changsha, Hunan Province
PRC
American
Dr. Hu Albert Sibo (౶௹) Room 2003, Building 7, Phase 2
Vanke Jinyu Tixiang
Xiaoxiang Middle Road, Yuelu District
Changsha, Hunan Province
PRC
Chinese (Hong Kong)
Non-executive Directors
Prof. Li Zexiang ( ҽዣಱ) Room 801, Building 3
No. 11 University Road
Songshan Lake
Dongguan, Guangdong Province
PRC
Chinese (Hong Kong)
Mr. Wang Hao (؀)
1) #20-04 Ardmore II
2 Ardmore Park Road
Singapore
Chinese
Ms. Y ang Xi ( เ๣) Room 8D, Xiangliange, Xiangli Building
No. 2075 Lianhua Road
Futian District
Shenzhen, Guangdong Province
PRC
Chinese (Hong Kong)
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Name Address Nationality
Dr. Li Zhiyong (ۇ)Unit 103, Building A14, Xijie Garden,
No. 10 Renmin East Road,
Furong District,
Changsha, Hunan Province
PRC
Chinese
Independent non-executive Directors
Dr. Li Xiaoyuan (ࡡ)2/F, 55 Tai Po Tsai Village
Clearwater Bay Road
Sai Kung, New Territories
Hong Kong
Chinese (Hong Kong)
Prof. Tan Guangrong
(ᗈΈ࿲)
Room 203, Building 16, First Area
Wangyuehu Community, Yuelu District
Changsha, Hunan Province
PRC
Chinese
Mr. Zhang Jiangang ( ੵ਄፻) Flat E, 2/F, B1, The Horizon
18 Fo Chun Road
Taipo, New Territories
Hong Kong
Chinese (Hong Kong)
Note:
(1) As of the date of this prospectus, Mr. Wang Hao was our non-executive Director. Mr. Wang Hao has already
tendered his resignation from directorship, conditional and effective upon Listing, and the appointments (i) of Dr.
Li Zhiyong as a non-executive Director and (ii) Dr. Li Xiaoyuan, Prof. Tan Guanrong and Mr. Zhang Jiangang as
independent non-executive Directors will become effective at the same time. Mr. Wang Hao is a board
representative of HongShan prior to Listing and have performed non-executive functions through providing advice
on our overall development as a private company. Mr. Wang Hao has tendered his resignation based on internal
decision-making of HongShan which he represents and his intention to focus on other endeavours. In addition, the
appointment of three independent non-executive directors would allow us to meet the requirements under Rules
3.10(1) and 3.10A of the Listing Rules that our Board shall include at least three independent non-executive
directors, who shall represent at least one-third of our Board. Mr. Wang Hao has confirmed to the Board that he has
no disagreement with the Board and there are no other matters in relation to his resignation that need to be brought
to the attention of the Shareholders of the Company.
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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PARTIES INVOLVED IN THE GLOBAL OFFERING
Joint Sponsors China International Capital Corporation Hong
Kong Securities Limited
29/F One International Finance Centre
1 Harbour View Street
Central, Hong Kong
China Securities (International) Corporate
Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central, Hong Kong
Ping An of China Capital (Hong Kong)
Company Limited
Units 3601, 07 & 11−13
36/F, The Center
99 Queen’s Road Central
Hong Kong
Sponsor-overall Coordinators China International Capital Corporation Hong
Kong Securities Limited
29/F One International Finance Centre
1 Harbour View Street
Central, Hong Kong
China Securities (International) Corporate
Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
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
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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China Securities (International) Corporate
Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central, Hong Kong
Ping An Securities (Hong Kong) Company
Limited
Units 3601, 07 & 11−13
36/F, The Center
99 Queen’s Road Central
Hong Kong
Joint Global Coordinators China International Capital Corporation Hong
Kong Securities Limited
29/F One International Finance Centre
1 Harbour View Street
Central, Hong Kong
China Securities (International) Corporate
Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central, Hong Kong
Ping An Securities (Hong Kong) Company
Limited
Units 3601, 07 & 11−13
36/F, The Center
99 Queen’s Road Central
Hong Kong
Joint Bookrunners China International Capital Corporation Hong
Kong Securities Limited
29/F One International Finance Centre
1 Harbour View Street
Central, Hong Kong
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China Securities (International) Corporate
Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central, Hong Kong
Ping An Securities (Hong Kong) Company
Limited
Units 3601, 07 & 11−13
36/F, The Center
99 Queen’s Road Central
Hong Kong
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Funde Securities Limited
Unit 2203, 22/F, Tower 1, Admiralty Centre
18 Harcourt Road, Admiralty
Hong Kong
Guosen Securities (HK) Brokerage Company,
Limited
Suites 3207−3212 on Level 32
One Pacific Place, 88 Queensway
Hong Kong
ICBC International Securities Limited
37/F ICBC Tower
3 Garden Road
Hong Kong
China Everbright Securities (HK) Limited
33/F, Everbright Centre
108 Gloucester Road, Wan Chai
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Winbull Securities International (Hong Kong)
Limited
Room 2202-3, 22/F, Jubilee Centre
18 Fenwick Street, Wan Chai
Hong Kong
Livermore Holdings Limited
Unit 1214A, 12/F, Tower II Cheung Sha Wan Plaza
833 Cheung Sha Wan Road, Kowloon
Hong Kong
Shenwan Hongyuan Securities (H.K.) Limited
Level 6, Three Pacific Place
1 Queen’s Road East
Hong Kong
Tiger Brokers (HK) Global Limited
23/F, Li Po Chun Chambers
189 Des V oeux Road Central
Hong Kong
Joint Lead Managers China International Capital Corporation Hong
Kong Securities Limited
29/F One International Finance Centre
1 Harbour View Street
Central, Hong Kong
China Securities (International) Corporate
Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central, Hong Kong
Ping An Securities (Hong Kong) Company
Limited
Units 3601, 07 & 11−13
36/F, The Center
99 Queen’s Road Central
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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ABCI Securities Company Limited
10/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Funde Securities Limited
Unit 2203, 22/F, Tower 1, Admiralty Centre
18 Harcourt Road, Admiralty
Hong Kong
Guosen Securities (HK) Brokerage Company,
Limited
Suites 3207−3212 on Level 32
One Pacific Place, 88 Queensway
Hong Kong
ICBC International Securities Limited
37/F ICBC Tower
3 Garden Road
Hong Kong
China Everbright Securities (HK) Limited
33/F, Everbright Centre
108 Gloucester Road, Wan Chai
Hong Kong
Winbull Securities International (Hong Kong)
Limited
Room 2202-3, 22/F, Jubilee Centre
18 Fenwick Street, Wan Chai
Hong Kong
Livermore Holdings Limited
Unit 1214A, 12/F, Tower II Cheung Sha Wan Plaza
833 Cheung Sha Wan Road, Kowloon
Hong Kong
Shenwan Hongyuan Securities (H.K.) Limited
Level 6, Three Pacific Place
1 Queen’s Road East
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Tiger Brokers (HK) Global Limited
23/F, Li Po Chun Chambers
189 Des V oeux Road Central
Hong Kong
Capital Market Intermediaries China International Capital Corporation Hong
Kong Securities Limited
29/F One International Finance Centre
1 Harbour View Street
Central, Hong Kong
China Securities (International) Corporate
Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central, Hong Kong
Ping An Securities (Hong Kong) Company
Limited
Units 3601, 07 & 11−13
36/F, The Center
99 Queen’s Road Central
Hong Kong
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
ABCI Securities Company Limited
10/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Funde Securities Limited
Unit 2203, 22/F, Tower 1, Admiralty Centre
18 Harcourt Road, Admiralty
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 131 ---
Guosen Securities (HK) Brokerage Company,
Limited
Suites 3207−3212 on Level 32
One Pacific Place, 88 Queensway
Hong Kong
ICBC International Securities Limited
37/F ICBC Tower
3 Garden Road
Hong Kong
China Everbright Securities (HK) Limited
33/F, Everbright Centre
108 Gloucester Road, Wan Chai
Hong Kong
Winbull Securities International (Hong Kong)
Limited
Room 2202-3, 22/F, Jubilee Centre
18 Fenwick Street, Wan Chai
Hong Kong
Livermore Holdings Limited
Unit 1214A, 12/F, Tower II Cheung Sha Wan Plaza
833 Cheung Sha Wan Road, Kowloon
Hong Kong
Shenwan Hongyuan Securities (H.K.) Limited
Level 6, Three Pacific Place
1 Queen’s Road East
Hong Kong
Tiger Brokers (HK) Global Limited
23/F, Li Po Chun Chambers
189 Des V oeux Road Central
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Auditor and Reporting Accountant BDO Limited
Certified Public Accountants
25/F, Wing On Centre
111 Connaught Road Central
Hong Kong
Legal Advisors to the Company As to Hong Kong and U.S. laws:
Clifford Chance
27/F, Jardine House
One Connaught Place
Central
Hong Kong
As to PRC law:
Zhong Lun Law Firm
Floor 57/58/59, Building A
Ping An Financial Center
No. 5033 Yitian Road, Futian District
Shenzhen, Guangdong Province
PRC
As to U.S. export control and sanctions law
Pillsbury Winthrop Shaw Pittman LLP
1200 Seventeenth Street, NW
Washington, DC 20036
The United States
Legal Advisors to the Joint Sponsors
and the Underwriters
As to Hong Kong and U.S. laws:
Latham & Watkins LLP
18th Floor, One Exchange Square
8 Connaught Place
Central
Hong Kong
As to PRC law:
Fangda Partners
27/F, North Tower Beijing Kerry Centre
1 Guanghua Road Chaoyang District
Beijing 100020, China
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 133 ---
Independent Property Valuer A VISTA Valuation Advisory Limited
Room 2401−06, 24/F
Everbright Centre
No. 108 Gloucester Road
Wan Chai, Hong Kong
Industry Consultant China Insights Industry Consultancy Limited
10/F, Block B
Jingan International Center
88 Puji Road
Jingan District, Shanghai
Receiving Banks Bank of Communications Co., Ltd.
Hong Kong Branch
U n i tBB / F&G / F ,U n i tCG / F ,1 - 3 / F ,1 6 / F
Room 01 & 18/F
Wheelock House
20 Pedder Street, Central
Hong Kong
China CITIC Bank International Limited
80 Floor, International Commerce Centre
1 Austin Road West, Kowloon
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 134 ---
Registered Office, Headquarters and
Principal Place of Business in the
PRC
Building A3 and A4
Hunan Provincial Inspection and Testing
Characteristic Industrial Park
No. 336 Xueshi Road, Yuelu District
Changsha, Hunan Province
PRC
Principal Place of Business in Hong
Kong
31/F, Tower Two
Times Square
1 Matheson Street
Causeway Bay
Hong Kong
Company’s Website www.cidi.ai
(The information contained in this website does not
form part of this Prospectus)
Joint Company Secretaries Ms. AU Wing Sze ( ਜ൘་)
31/F, Tower Two
Times Square
1 Matheson Street
Causeway Bay
Hong Kong
Mr. LI Chunlin (؍݆)
Building A3 and A4
Hunan Provincial Inspection and Testing
Characteristic Industrial Park
No. 336 Xueshi Road, Yuelu District
Changsha, Hunan Province
PRC
CORPORATE INFORMATION
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--- page 135 ---
Authorized Representatives Dr. HU Albert Sibo (౶௹)
Room 2003, Building 7, Phase 2
Vanke Jinyu Tixiang
Xiaoxiang Middle Road, Yuelu District
Changsha, Hunan Province
PRC
Mr. LI Chunlin (؍݆)
Building A3 and A4
Hunan Provincial Inspection and Testing
Characteristic Industrial Park
No. 336 Xueshi Road, Yuelu District
Changsha, Hunan Province
PRC
Audit Committee Prof. TAN Guangrong ( ᗈΈ࿲) (Chairperson)
Ms. YANG Xi ( เ๣)
Dr. LI Xiaoyuan (ࡡ)
Remuneration Committee Dr. LI Xiaoyuan (ࡡ)Chairperson)
Dr. MA Wei ( ৵ᐂ)
Mr. ZHANG Jiangang ( ੵ਄፻)
Nomination Committee Prof. LI Zexiang ( ҽዣಱ) (Chairperson)
Dr. LI Xiaoyuan (ࡡ)
Mr. ZHANG Jiangang ( ੵ਄፻)
Compliance Advisor Gram Capital Limited
Room 1209
12/F, Nan Fung Tower
88 Connaught Road Central/
173 Des V oeux Road Central
Central
Hong Kong
H Share Registrar Tricor Investor Services Limited
17/F, Far East Finance Centre
16 Harcourt Road
Hong Kong
CORPORATE INFORMATION
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--- page 136 ---
Principal Bank Bank of Communications Co., Ltd.
Changsha Yuelushan Branch
Building 1, Lufengheyuan
No. 328 Xiaoxiang Middle Road
Yuelu District
Changsha, Hunan Province
PRC
Shanghai Pudong Development Bank Co., Ltd.
Changsha Lugu Science and Technology Branch
Floors 1-3, Entrepreneurship Building
Lugu Enterprise Plaza
No. 27 Wenxuan Road
Changsha High-tech Development Zone
Changsha, Hunan Province
PRC
CORPORATE INFORMATION
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--- page 137 ---
This and other sections of this Prospectus contain information relating to the industry in
which we operate. Certain information and statistics set forth in this section have been
extracted from the CIC Report issued by CIC, an independent market research agency, which we
commissioned, and from various official government publications and other publicly available
publications. Information and statistics from official government sources have not been
independently verified by us, the Joint Sponsors, the Joint Overall Coordinators, the Capital
Market Intermediaries, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead
Managers, the Underwriters, any of our or their respective directors, officers or representatives
or any other person or party involved in the Global Offering, and no representation is given as
to their accuracy.
OVERVIEW OF GLOBAL AND CHINA’S COMMERCIAL VEHICLE INTELLIGENT
DRIVING INDUSTRY
Overview of Driving Automation
The rapid development of driving automation technology is reshaping global transportation,
leading mobility into a new era with enhanced safety, efficiency and comfort.
The Society of Automotive Engineers, a global professional association and standards
organization, categorizes driving automation into six levels, ranging from full control by a human
driver, supported by advanced safety features, to vehicles that can operate entirely without any
human input.
Levels of driving automation
LEVEL 0 LEVEL 1 LEVEL 2 LEVEL 3 LEVEL 5LEVEL 4
You are driving  whenever these driver support features are engaged
– even if your feet are off the pedals and you are not steering
You must constantly supervise these support features: you must
steer, brake or accelerate as needed to maintain safety
You are not driving when these automated driving features are
engaged - even if you are seated in “the driver's seat”
These automated driving features will not
require you to takeover driving
you must drive
When the feature
requests
What does
the human
in the
driver’s seat
have to do?
Note:
(1) In the Industry Overview section, “China” or “PRC” refers to the People’s Republic of China, which for the
purpose of this section and for geographical reference only, including Hong Kong, the Macau Special
Administrative Region of the People’s Republic of China and Taiwan.
INDUSTRY OVERVIEW (1)
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The table below illustrates the differences among the six levels of driving automation:
Levels of driving automation Definition
Level 0 The vehicle has no driving automation.
Level 1 The vehicle features a single automated system for driver
assistance, such as steering or brake/acceleration support to
the driver.
Level 2 The vehicle can provide both steering and
brake/accelerating support to the driver.
Level 3 The vehicle is equipped with “environmental detection”
capabilities and can make informed decisions for
themselves, such as accelerating past a slow-moving
vehicle, but will not operate unless certain conditions are
met.
Level 4 The vehicle can automatically drive without human
intervention under limited conditions such as certain
locations, road types, weather, etc.
Level 5 The vehicle can drive under all conditions without human
intervention.
Among these, Level 2+ is commonly used to describe systems that require constant human
supervision and can offer functions surpassing Level 2 but not fully reaching Level 3. Vehicles
equipped with Level 2+ or higher systems can achieve vehicle autonomy with minimal human
intervention under suitable driving conditions.
Overview of Intelligent Driving
Driving automation is primarily divided into two categories: advanced driver-assistance
systems (ADAS) and intelligent driving. As illustrated below, ADAS refers to technologies and
functions that assist drivers in various driving tasks, while requiring the driver to remain attentive.
ADAS provides functionalities at Level 1 and Level 2. In contrast, intelligent driving involves a
higher level of automation, which typically provides functionalities at Level 2+ and higher, aiming
to eventually achieve full automation, wherein vehicles can operate without human intervention.
Intelligent driving technology is evolving from a mix of conditional and full automation toward
complete full automation, enabling vehicles to navigate increasingly complex, diverse and
challenging scenarios.
INDUSTRY OVERVIEW
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Globally, the technological capabilities of driving automation solutions are approaching the
intelligent driving level. In the passenger vehicle market, commercialized solutions still remain
largely focused on ADAS due to high regulatory hurdles on open urban roads. However, since the
responsibility for intelligent driving operations in closed environments lies with the scenario
operator rather than public traffic authorities, and because closed environments allow for a
controlled setting for the comprehensive deployment of intelligent driving solutions before scaling
to a wider variety of applications, they present an ideal setting for the early testing and
deployment of intelligent driving technology.
ADAS Intelligent driving
Driver Assistance High/Full AutomationConditional Automation
Smart vehicle driving under all
conditions
Smart vehicle driving
under limited conditions
Automated system providing
assisted driving features only
 Lane centering
 Lane departure warning
 Lane following
 Adaptive cruise control
 Automatic emergency braking
…
High Automation
 Pedal/steering wheel may not be
installed
Full Automation
 Driverless and automated under all
conditions
 Robobus/Robotruck …
 NOA on highway and urban
scenarios
 Traffic sign recognition and stop sign
control
 Automated parking
…
Driving
Responsibility
Key Features &
Functions
Overview of driving automation
Human Driver
Automated
System
Little or no human
intervention
Human driver intervening when
necessary
Human driver solely
responsible
Supervising
Responsibility
Overview of China’s Commercial Vehicle Intelligent Driving Industry
Intelligent driving commercial vehicles have already achieved large-scale commercialization,
primarily due to the following pain points that create guaranteed market acceptance for
commercial vehicle intelligent driving solutions.
(i) Safety. Safety is the most critical concern in commercial vehicle operations, since
accidents can lead to severe injuries, significant economic losses and disruptions to
operations. The introduction of intelligent driving technology enables driverless
commercial vehicle operations, reducing accidents caused by human error and
minimizing potential casualties and financial losses. Additionally, drivers face health
risks associated with commercial vehicle operations, such as chronic lung and hearing
problems caused by dust and noises in mining areas. Vehicle automation can protect
drivers from prolonged exposure to hazardous environments, thereby lowering such
health risks.
INDUSTRY OVERVIEW
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(ii) Efficiency and Reliability. Operations with manned commercial vehicles are often
suspended due to humans’ limited attention span and inability to work long, consecutive
hours. In contrast, intelligent driving commercial vehicles can operate 24/7, thereby
improving operational efficiency and reliability.
Intelligent driving commercial vehicles have been deployed in various scenarios, which can
be categorized into three main types: urban roads, intercity roads and closed environments. Urban
roads scenarios mainly involve robobuses, urban logistics, last-mile delivery and robosweepers.
Intercity roads scenarios refer to intercity logistics vehicles. Closed environments primarily
include mines, industrial parks, ports and airports.
The development of intelligent driving technologies vary significantly across urban roads,
intercity roads, and closed environments.
Urban roads: Urban roads are characterized by high traffic density and more unpredictable
road conditions, which makes intelligent driving in urban roads demand more advanced perception
technologies and sophisticated algorithms capable of handling these unstructured scenarios. At the
same time, regulatory frameworks in urban settings are typically fragmented due to the
involvement of multiple stakeholders. In most cases, current policies allow only vehicles with
Level 2+ or lower capabilities to run on urban roads, with fully driverless operations not yet
authorized, resulting in extended implementation timelines and the business models still remain in
an exploratory stage.
Intercity roads: Compared to urban roads, the deployment of intelligent driving on intercity
roads is relatively more viable, owing to more structured traffic conditions, higher yet more
predictable vehicle speeds and limited interactions with minimal involvement of pedestrians or
complex intersections. Although regulatory constraints on vehicle automation levels still persist,
the higher degree of scenario standardization has facilitated consistent policy support, with
large-scale pilot programs and commercial rollouts in intercity logistics steadily progressing.
Closed environments: Closed environments are among the most promising scenarios of
intelligent driving. Intelligent driving operations within such environments generally comply with
existing laws and regulations, as they offer clearly defined operational boundaries, planned routes,
simplified traffic conditions and a high degree of environmental controllability; moreover, in 2024,
national policies have explicitly called for promoting “unmanned and less-manned” operations in
hazardous mining sites, all of which contribute to greater intelligent driving solutions feasibility,
reliability, stability and operational efficiency. The regulatory landscape in closed environments is
supportive of intelligent driving technologies, providing a favorable policy environment for future
INDUSTRY OVERVIEW
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deployment. Among various closed environments, open-pit mines, characterized by their hazardous
conditions, pollution, remoteness, and large scale, constitute a rigid-demand market for intelligent
driving industry.
As intelligent driving remains in the early stages of commercialization across various
application scenarios, most market players are focused on deepening their capabilities within their
respective domains of expertise. Currently, the commercialization of intelligent driving solutions
for commercial vehicles on urban and intercity roads is still nascent. With respect to urban roads,
several intelligent driving companies have collaborated with local governments to establish fixed
routes connecting major transportation hubs with surrounding facilities. In terms of intercity roads,
autonomous logistics truck companies are working with logistics companies and commercial
vehicle OEMs to pilot smart heavy-duty truck operations for long-haul transportation. In contrast,
the commercialization of intelligent driving solutions in closed environments is at a significantly
higher level. Successful deployments in mining sites, ports and industrial parks demonstrate the
effective integration of intelligent driving technologies into established processes and
infrastructure. These deployments exemplify the successful implementation of intelligent driving
solutions in closed environments.
Although closed environments are ideal for the early testing and deployment of intelligent
driving technology, transitioning to the commercial vehicle intelligent driving market presents
significant challenges for companies originally focused on passenger vehicles. Firstly, the elevated
viewpoints of commercial vehicles and the consequently larger blind spots necessitate a distinct
and more sensor deployment strategies compared to passenger vehicles. This includes a greater
number of sensors, more complex installation configurations and stricter requirements for sensing
reliability, shock resistance, and dust resistance to ensure accurate perception and safe operation,
especially in unstructured environments such as mining sites where there are no road signs, lane
markings or guidelines. Secondly, the heavier weight of commercial vehicles results in more
sluggish steering, braking and throttle responses, making stable motion control more sophisticated.
This imposes stricter requirements on the validation of intelligent driving solutions in real-world
scenarios, particularly during heavy-load transportation. Last but not the least, the harsh working
environments such as dirty, dusty and rocky roads and extended operating hours typical of
commercial vehicle operations demand stronger on-site deployment and testing capabilities for
industrial heavy machinery to ensure reliable and efficient intelligent driving performance under
demanding conditions.
INDUSTRY OVERVIEW
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Start of commercializationComplexity of road condition
Time of commercialization
2020 2025 20302015
Overview of commercial vehicle intelligent driving
Intercity
roads
Inter-city robotruck
Closed
environments
Autonomous mining
Unmanned port
……
Urban
roads
Intra-city robotruck
Intra-city robosweeper
Intra-city robobus
Companies in the commercial vehicle intelligent driving market primarily follow two
business models: product sales and fleet operation. Product sales, which primarily generate
one-time revenue, contribute to healthier cash flow and stronger financial stability for companies.
However, success under the product sales model requires robust expertise in vehicle manufacturing
to ensure optimal integration, advanced technical capabilities to address software and hardware
compatibility challenges, and strong customer retention with technological alignment to secure a
steady flow of orders and drive sustainable growth. Under the product sales model, there are
occasions that customers may require solution providers to provide financial assistance (e.g.,
offering guarantees for financial leases, granting extended payment terms) as a condition for
placing orders. Conversely, fleet operation offers customers comprehensive operation services,
encompassing end-to-end support and maintenance. The business models of fleet operation vary
across different application scenarios. For example, in urban roads, operators of robosweeper fleets
typically adopt a project-based pricing model, offering clients a comprehensive service package
that includes the deployment, daily operation, and maintenance of robosweeper fleets and charges
fee for fixed periods. In contrast, within mining sites, fleet operators of autonomous mining trucks
typically adopt a usage-based pricing model, charging clients based on either the total freight
volume or the total transportation mileage. While fleet operation delivers added value to
customers, it entails relatively higher operational costs with sales proceeds collection periods often
extending throughout the entire operation cycle, which typically lasts two to three years or more,
and could potentially lead to direct competition with customers with regard to fleet operation.
Companies offer intelligent driving systems for commercial vehicles in two manners.
factory-installed and after market. The factory-installed model offers higher integration, safety and
reliability, while requiring intelligent driving technology companies to possess advanced
knowledge of vehicle manufacturing to achieve better integration. This model also requires close
collaboration with vehicle manufacturers for a stable supply of vehicles. In contrast, the after
INDUSTRY OVERVIEW
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market model allows customers to select and install systems into existing vehicles based on
individual needs. This model could enable better cost control, but faces challenges in terms of
software and hardware compatibility. As technology advances and the ecosystem for intelligent
driving commercial vehicles matures, the factory-installed model is expected to become the
mainstream solution in the future.
According to CIC, the market size of global commercial vehicle intelligent driving reached
RMB10.0 billion in 2024 and is expected to grow significantly, reaching RMB1,614.4 billion by
2030, with a CAGR of 133.3% from 2024 to 2030. China’s commercial vehicle intelligent driving
market, which stood at RMB4.8 billion in 2024, is expected to grow rapidly due to favorable
policies and technological advancements in intelligent driving, with a projected market size of
RMB774.3 billion by 2030. As an early adopter of intelligent driving technology, the sub-segment
of the intelligent driving commercial vehicles in closed environments reached RMB5.1 billion in
global and RMB 2.6 billion in China, representing approximately 50.8% of the global market size
and 53.8% of the China’s market size in 2024, both being significantly higher than the market size
of the urban roads and intercity roads segments. Going forward, with the continued advancement
of intelligent driving technology and ongoing exploration of commercialization in other scenarios,
urban roads and intercity roads are expected to experience faster growth. The market size of global
commercial vehicle intelligent driving in closed environments is expected to reach RMB107.5
billion, representing approximately 6.7% of the global market size by 2030. The market size of
China’s commercial vehicle intelligent driving in closed environments is expected to reach
RMB56.8 billion, representing approximately 7.3% of the China’s market by 2030.
2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
0.6 2.2 2.4 4.8 11.8 25.0
59.0
151.2
375.0
774.3
RMB billion
Urban roads
Intercity roads
Closed environments
Market size of commercial vehicle intelligent driving industry, by application scenario, China, 2021-2030E
CAGR
2021-2024 2024-2030E
60.1% 178.3%
357.3% 141.0%
93.7% 67.5%
Total 97.1% 133.5%
Note: The market size includes revenues from both product sales and fleet operations.
INDUSTRY OVERVIEW
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57%
35%
51% 54% 53% 47%
33%
20% 11% 7%
23%
30% 24% 22% 24%
30%
33%
31% 29%
41% 43%
20% 22% 25% 29% 37% 48% 58% 64%
2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
2%
%
Segmentation of commercial vehicle autonomous driving industry, by application scenario, China, 2021-2030E
Urban roads Closed environmentsIntercity roads
Competitive landscape of China’s Commercial Vehicle Intelligent Driving Market
China’s commercial vehicle intelligent driving market was relatively fragmented as of
December 31, 2024, with many players still in the stages of exploring technological breakthroughs
and accumulating data. Some leading companies are actively expanding into various application
scenarios to achieve large-scale commercialization. According to CIC, the Company ranked sixth
among all commercial vehicle intelligent driving companies in China, with a market share of
approximately 5.2%. Notably, the Company’s revenue was primarily generated from product sales
during the Track Record Period. Additionally, CiDi is one of the earliest companies to achieve
commercialization in China’s commercial vehicle intelligent driving market.
INDUSTRY OVERVIEW
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Company
Revenue from
commercial vehicle
intelligent driving,
RMB million
Market share, %

Company A ~1,000 20.9%
Company B ~590 12.3%
Company C ~430 9.0%
Company D ~300 6.3%
Company E ~290 6.1%
CiDi ~250 5.2%
Company F ~200 4.2%
Company G ~200 4.2%
Company H ~150 3.1%
Company I ~130 2.7%
Competitive landscape of China (including Hong Kong, Macau and Taiwan)’s
commercial vehicle intelligent driving market, 2024
Notes:
(1) This table includes revenue from both product sales and fleet operations for the listed companies. However, our
revenue was generated primarily from product sales during the Track Record Period, with no involvement in fleet
operations.
(2) Company A is an intelligent driving company headquartered in China and founded in 2018. It primarily provides
driving automation solutions on mining trucks. It is not a listed company.
(3) Company B is an intelligent driving company headquartered in China and founded in 2015. It primarily provides
driving automation solutions on sweepers and buses. It is not a listed company.
(4) Company C is an intelligent driving company headquartered in China and founded in 2018. It primarily provides
driving automation solutions on logistics trucks. It is not a listed company.
(5) Company D is an intelligent driving company headquartered in China and founded in 2015. It primarily provides
driving automation solutions on mining trucks. It is not a listed company.
(6) Company E is an intelligent driving company headquartered in China and founded in 2016. It primarily provides
driving automation solutions on logistics trucks. It is a listed company on NASDAQ and the Hong Kong Stock
Exchange.
(7) Company F is an intelligent driving company headquartered in China and founded in 2021. It primarily provides
driving automation solutions on logistics trucks. It is an unlisted company.
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(8) Company G is an intelligent driving company headquartered in China and founded in 2014. It primarily provides
driving automation solutions on mining trucks. It is not a listed company.
(9) Company H is an intelligent driving company headquartered in China and founded in 2020. It primarily provides
driving automation solutions on logistics trucks. It is not a listed company.
(10) Company I is an intelligent driving company headquartered in China and founded in 2017. It primarily provides
driving automation solutions on taxis, buses, sweepers and vans. It is a listed company on NASDAQ and the Hong
Kong Stock Exchange.
OVERVIEW OF CHINA’S AUTONOMOUS MINING TRUCK SOLUTION INDUSTRY
Overview of Autonomous Mining
The mining industry is crucial for the national economy, continuously supplying key raw
materials and energy to various sectors, such as aggregate, coal and iron ore. In 2024, the output
value of China’s mining industry reached RMB4.5 trillion and is expected to maintain steady
growth. However, traditional mining operations rely on heavy machinery and human labor,
presenting the following pain points.
(i) Frequent Accidents: Mining operations take place in hazardous environments where
workers face risks such as collapses, explosions and toxic gas leaks, leading to frequent
accidents. Each year, the direct economic losses caused by mining safety incidents in
China approaches RMB10 billion. Additionally, further economic losses will occur when
mining operations are suspended following such incidents.
(ii) Harsh and remote Working Conditions: Mining jobs are extremely demanding, with
underground operations often involving high temperatures, high humidity, high noise
levels and poor air quality. Prolonged exposure to such conditions severely impacts
workers’ health, jeopardizing the mining operation’s long-term sustainability.
Meanwhile, mining sites are typically located in remote areas, where harsh working
conditions lead to low willingness among workers to participate.
(iii) Aging Workforce: The number of employees in China’s mining industry is expected to
decline from approximately 3.3 million in 2024 to 3.2 million by 2030. Meanwhile,
attracting young workers to the mining industry is increasingly difficult due to the harsh
working conditions, resulting in an aging workforce, with over 60% of workers being
older than 40. The increasingly aging workforce in the mining industry leads to greater
risks of human error and reduced productivity, causing heightened safety concerns and
lower operational efficiency.
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(iv) Low Economic Efficiency: Traditional mining methods rely heavily on labor and
machinery, leading to high production costs. For example, a mining truck typically runs
for at least 16 hours per day and sometimes up to 24 hours, usually requiring 2-3 drivers
per truck to ensure its normal operation. As a result, mining companies have
experienced a continuous decline in profitability in recent years due to the increase of
labor costs.
Intelligent driving technology enhances operational safety in mining, a pressing demand in
the industry. With technological advancements and favorable government policy, mining was one
of the first industries to realize the large-scale commercialization of intelligent driving. Companies
specializing in autonomous mining truck solutions
(1) focus on developing key technologies such as
autonomous driving systems, V2X technology, multi-vehicle intelligent dispatch algorithms and
mixed fleet management. These technologies cover the entire mining process — such as drilling,
blasting, excavation and transportation — enhancing operational safety, sustainability and
efficiency, while addressing the long-standing pain points of traditional mining operations.
Unlike other closed environments, mining sites are complex and highly variable and require
various types of operational vehicles, making the deployment of reliable and comprehensive
intelligent driving challenging. Hence, autonomous mining technology companies must possess
strong research and development capabilities to overcome challenges relating to environmental
perception in mines, precise control of heavy-duty vehicles, vehicle reliability testing and
large-scale mixed fleet coordination and systematic dispatching.
China’s autonomous mining truck solution industry is rapidly expanding, with market size
reaching RMB1.9 billion in 2024, representing approximately 75.6% of the intelligent driving
market within closed environments. By 2030, the market is expected to grow significantly to
RMB39.6 billion, at a CAGR of 65.3% from 2024 to 2030. In 2024, product sales accounted for
approximately 34% of China’s autonomous mining truck solution market and the proportion is
projected to increase to approximately 40% by 2030. The total addressable market size
(2) of
China’s autonomous mining truck solution industry in 2024 was approximately RMB550 billion.
Notes:
(1) Autonomous mining involves the full automation of the mining process, which includes both extraction and
transportation within mining sites. Autonomous mining trucks solution mainly focuses on the transportation process
conducted by autonomous mining trucks, which are autonomous driving trucks designed for mining operations.
(2) The total addressable market size includes product sales and fleet operation, calculated based on the installed base
of mining trucks and assuming the penetration rate of intelligent driving is 100%.
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2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
0.0 0.2 0.4 1.9
5.2
9.9
16.0
23.5
31.8
39.6
Market size of autonomous mining truck solution industry, China, 2021-2030E
CAGR
2021-2024 2024-2030E
333.7% 65.3%
RMB billion
0%
Penetration rate of autonomous mining trucks:
1% 5% 7% 19% 24% 31% 40% 49% 55%
Note: The market size includes revenues from both product sales and fleet operations.
In 2024, the total shipment of autonomous mining trucks in China was approximately 1,400
units. This is projected to increase to approximately 5,500 units in 2026 and further to over 16,000
units in 2030. Globally, the total shipment of autonomous mining trucks was approximately 2,100
units in 2024, and is expected to increase to approximately 8,700 units in 2026 and exceed 26,000
units in 2030. In 2024, the average price of an ordinary mining truck in China is approximately
RMB1.5 million per unit, compared to over RMB4.5 million per unit in the international market,
while the average price of autonomous mining trucks in China was approximately RMB2.5 million
per unit, compared to over RMB5.0 million per unit in the international market.
Meanwhile, the Middle East, Australia, and South America also rank among the leading
global suppliers of essential resources like coal, copper, and lithium, presenting significant
opportunities for the deployment of autonomous mining truck solutions. In developed markets like
Australia, labor costs in mining are exceptionally high, but mining companies still struggle with
recruiting and retaining sufficient qualified drivers due to the remote and challenging nature in
mining sites. The substantial mining demand, persistent labor shortage, coupled with increasing
pressure to improve operational efficiency and safety, has created a strong imperative for the
adoption of autonomous mining technologies in these oversea regions. As a result, regions such as
Australia, Europe and South America have emerged as strategic markets for autonomous mining
and poised to play an important role in driving the global market’s expansion in the following
years.
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Drivers of China’s Autonomous Mining Truck Solution Industry
 Heightened Safety Standard: The continuously increasing demand for coal and other
resources causes excessive production in mining areas, thus overlaboring mining workers and
escalating safety risks. Accidents can endanger workers and lead to mine shutdowns,
disrupting production and causing significant economic losses. Autonomous mining can
effectively reduce accidents caused by human error, thereby improving overall safety in
mining operations.
 Growing Need for Cost Efficiency: Maximizing extraction efficiency and managing costs
have become essential for maintaining mining companies’ competitiveness. Deploying
autonomous mining vehicles can significantly reduce labor and energy costs while allowing
for continuous 24-hour operation, thereby improving cost efficiency for mining companies.
 Technological Advancement: Vehicle intelligence and V2X form the foundation of
autonomous mining. Vehicle intelligence, powered by onboard sensors, control systems and
algorithms, equips mining trucks with intelligent driving capabilities. Meanwhile, V2X
technology enables the exchange of real-time traffic information both between vehicles as
well as between vehicles and road infrastructure, effectively filling the information gaps of
vehicle-based autonomy and enhancing overall transportation efficiency in mining operations.
The integration of vehicle intelligence and V2X technologies drives the commercialization of
autonomous mining truck solutions in China.
 Regulatory Mandate: The Chinese government is continuously introducing policies and
mandates that provide strong policy support as well as quantitative targets and timelines for
autonomous mining implementation to enhance mining safety and efficiency. For example,
the “Guiding Opinions on Accelerating the Development of Intelligent Coal Mines”, issued
by the NDRC and seven other ministries, stipulate that large coal mines and those with severe
hazards should achieve basic intelligentization by 2025, and all types of coal mines should
reach this goal by 2035. Directives by the National Mine Safety Supervision Bureau
stipulates that the proportion of intelligent coal mine production capacity should reach at
least 60% nationally by 2026. Additionally, the government is setting increasingly stringent
safety requirements for mining operations. These policies and mandates drive substantial
demand for autonomous mining technologies.
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Competitive landscape of China’s autonomous mining truck solution and autonomous
logistics truck solution market
According to CIC, the Company’s autonomous mining products are classified as Level 4
within the six levels of driving automation. In 2024, the Company was the third largest
autonomous mining technology company in China in terms of revenue. Autonomous mining
technology companies primarily generate project-based revenue, which can be subject to
fluctuations due to the impact of acceptance cycles.
Competitive landscape of China’s autonomous mining truck solution market, 2024
Company
Revenue from
autonomous mining
truck solution,
RMB million Market share, %
Company A .............................. ~1,000 51.6%
Company D .............................. ~300 15.5%
CiDi ................................... ~250 12.9%
Company G .............................. ~200 10.3%
Company J .............................. ~130 6.7%
Note:
(1) Company J is an intelligent driving company headquartered in China and founded in 2016. It primarily provides
driving automation solutions on mining trucks. It is not a listed company.
Autonomous logistics trucks are heavy-duty vehicles equipped with intelligent driving
solutions that are designed to transport goods in various logistics scenarios, including intercity
long-haul transport, industrial parks and distribution centers.
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Competitive landscape of China’s autonomous logistics truck solution market, 2024
Company Revenue from autonomous logistics
trucks, RMB million
Market share, in terms of revenue,
%
Shipment of autonomous logistics
trucks, unit
Company C ~430 32.7% ~1,700
Company E ~290 22.1% ~60
Company F ~200 15.2% ~60
Competitive analysis of China’s autonomous mining truck solution market
The table below presents a competitive analysis of autonomous mining technologies offered
by CiDi and its key competitors.
Large-scale hybrid
fleet operation
Obstacle detection
accuracy
Delay of video
transmission, ms Position error, m
✔ 40m; 10*10cm <100 <0.1
× 30m; 30*30cm <150 <0.2
✔ 30m; 30*30cm <150 <0.2
× 80m; 30*30cm <150 <0.2
Company
CiDi
Company D
Company G
Company A
Notes:
(1) Large-scale mixed fleet operation refers to the simultaneous operation of human-driven and autonomous vehicles
within a fleet comprising several hundred vehicles.
(2) Obstacle detection accuracy measures the system’s ability to recognize the location, size, shape, and other
characteristics of obstacles under various environments.
(3) Delay of video transmission refers to the time lag that occurs during the transmission of signals over a wireless
network from the video source to the receiving end.
(4) Position error refers to the deviation in determining the vertical position of a point relative to a reference level.
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Entry Barriers of China’s Autonomous Mining Truck Solution Industry
 Strong R&D Capabilities : Autonomous mining involves the integration of multiple core
technologies, including perception, V2X, intelligent scheduling and remote control, requiring
companies to possess strong, comprehensive technical capabilities. Additionally, to achieve
the commercialization of autonomous mining truck solutions, companies must address the
complex scenarios of mixed operations involving both manned and unmanned mining trucks.
The complexity of these high-density, mixed environments is comparable to that of urban
traffic, demanding extremely rigorous technical standards. As a result, autonomous mining
technology companies that achieved early commercialization have the first-mover advantage
to access valuable real-world mining data, enabling them to continuously improve their
intelligent driving algorithms and establish high technical barriers for new entrants.
 Sophisticated Methodologies: While mining areas are closed environments with relatively
simple road structures, their operational conditions are highly complex, featuring challenging
terrain such as large dirt areas, steep slopes, sharp turns and irregular roads, along with dense
vehicle distribution. Leveraging years of research and commercialization experience, leading
autonomous mining technology companies have developed a set of methodologies to ensure
that their vehicles can adapt to the complex conditions of mining sites. In contrast, new
entrants often lack a deep understanding of mining site conditions, making it difficult for
them to offer products of comparable quality.
 High Product Reliability and Versatility: Autonomous mining products must be highly
reliable to operate stably in harsh mining environments, such as dust, strong winds, rain and
snow. Additionally, autonomous mining products must be highly versatile to adapt to varying
mining operations, environments and tasks. Compared to new entrants who bear high costs to
customize vehicles for differing mining environments, leading autonomous mining technology
companies adopt a platform-based approach that enables their products to adapt to varying
mining sites, thereby reducing customization costs and improving cost efficiency.
 Integrated Supply Chain: Supply chain integration is crucial for cost reduction, efficiency
gains and sustainable profitability. Leading autonomous mining technology companies have
established strong partnerships with upstream suppliers, such as OEMs and other hardware or
software suppliers, to ensure a stable supply chain and reasonable cost control. Meanwhile,
they have also built deep relationships with downstream mining clients, who provide them
with stable market share and ongoing revenue sources. In contrast, new entrants are unable to
integrate their supply chain due to the lack of market recognition.
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Major Cost Analysis for Autonomous Mining Trucks
The mining truck body and the intelligent driving solution installed encompass the major
costs of an autonomous mining truck.
According to CIC, the average price of an ordinary mining truck is approximately RMB1.5
million in 2024. As technology continues to advance and manufacturing costs continue to decrease
due to economies of scale, the average price of mining trucks is projected to steadily decline over
time.
Meanwhile, the cost of the intelligent driving solution installed is largely dependent on the
cost of the underlying automotive semiconductors. The average global price of automotive
semiconductors rose approximately 10% in 2022, due to disruptions on the global auto-part supply
chain during COVID-19. Such impact began to ease in the second half of 2023, and the average
price growth of automotive semiconductors subsequently slowed to around 5.0% in 2023 and kept
to slow down in 2024, as supply-demand dynamics stabilize post-pandemic, according to CIC.
OVERVIEW OF CHINA’S V2X INDUSTRY
Overview of V2X
Vehicle intelligence and V2X are two complementary technological approaches to achieving
intelligent driving across various scenarios. Vehicle intelligence integrates perception,
decision-making, and control technologies to enable intelligent driving. However, it cannot
overcome challenges such as out-of-sight obstacles and has difficulty integrating with existing
roadside infrastructure. V2X is complementary to vehicle intelligence, helping to realize all levels
of driving automation across various scenarios.
V2X enhances safety, efficiency and intelligence in transportation systems by enabling
coordination between vehicles, roadside infrastructure, cloud platforms and communication
networks. It is crucial in overcoming the final hurdles of intelligent driving implementation.
Addressing the information blind spots of vehicle intelligence, V2X helps vehicles better navigate
through complex traffic conditions, improving the safety and reliability of intelligent driving.
Additionally, V2X enables coordinated control both between vehicles as well as between vehicles
and roadside infrastructure, allowing for shared driving intentions and avoiding conflicts over road
usage, thereby enhancing overall efficiency of the transportation system.
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V2X typically comprises four main components: on-board unit, roadside infrastructure, a
cloud platform with software algorithms and communication infrastructure. These components
work together to create a intelligent and efficient traffic management system:
 On-Board unit: An On-Board Unit (OBU) is a bidirectional wireless transceiver
installed in a vehicle that transmits vehicle status information via the 5.9 GHz frequency
band to other vehicles or roadside infrastructure.
 Roadside device: Roadside device includes the roadside unit (RSU) and roadside
sensing devices (such as cameras, LiDAR and mmWave radar). A Roadside Unit (RSU)
is a bidirectional wireless transceiver installed along the roadside. It receives
information transmitted by vehicles via the 5.9 GHz frequency band and, in turn, sends
data such as road incidents, traffic signals, and abnormal conditions to vehicles. The
RSU can also connect with roadside sensing devices to broadcast real-time traffic
information detected by these sensors to vehicles. Furthermore, RSUs communicate with
cloud platforms through other communication links such as optical fiber or 5G
networks.
 Cloud platform: Serving as the data processing and traffic decision-making center, the
cloud platform aggregates and analyzes data from the OBUs and RSUs, providing
comprehensive traffic optimization plans and control commands.
 Communication infrastructure: Communication infrastructure comprises optical fiber,
4G and 5G network base stations, which ensure efficient and stable data and information
transmission in V2X.
Interconnectivity among V2X hardware from various market players relies heavily on
standardized communication frameworks. Leading technologies such as Dedicated Short-Range
Communications (DSRC) and Cellular Vehicle-to-Everything (C-V2X) provide unified interfaces
and protocol stacks that enable seamless communication across vehicles, infrastructure, and
devices from different suppliers. The industry value chain of V2X ecosystem comprises hardware
suppliers, software solution providers, system integrators, and network operators. Although V2X
solutions deliver limited direct value to vehicles not equipped with OBUs, which are essential for
data transmission within the V2X network, the deployment of V2X solutions enhances overall
traffic efficiency and road safety, thereby generating systemic benefits that extend even to vehicles
not installed with OBUs.
China’s V2X market has reached a breakthrough point. Technological advancements in 5G
communication, sensing and artificial intelligence have enhanced the performance and reliability of
V2X. The Chinese government has issued a series of policies and standards to encourage the
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development and commercialization of V2X and intelligent driving technologies. Additionally, the
government has actively promoted the construction of V2X pilot zones. So far, China has
established 17 national-level intelligent connected vehicle demonstration zones, 7 national V2X
pilot zones, and 16 dual-intelligence pilot cities, accelerating the commercialization of V2X and
growth in China’s V2X market.
The national intelligent vehicle demonstration and V2X pilot zones have pioneered the
integration of vehicles, roadside infrastructure and cloud platforms, creating a fully coordinated
vehicle-road-cloud integrated system, which serve as crucial pilot projects for V2X development in
China. In 2024, the market size of China’s vehicle-road-cloud integrated systems reached RMB2.0
billion, which is expected to grow rapidly over the next few years and reach RMB23.8 billion by
2030, at a CAGR of 50.9% from 2024 to 2030.
2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
0.5 0.5 1.5 2.0
3.1
4.8
7.4
11.1
16.4
23.8
Market size of vehicle-road-cloud integrated system industry, China, 2021-2030E
CAGR
2021-2023 2023-2030E
56.2% 50.9%
RMB billion
The adoption of OBUs in China is expected to become a standard requirement, aligning with
benchmarks from developed markets. In 2024, the penetration rate of OBUs in terms of vehicle
sales was approximately 70% in China. Supported by the “Guidelines for the Construction of the
National Internet of Vehicles Industry Standard System,” China aims to establish a comprehensive
standard system for intelligent connected vehicles by 2030. Additionally, the ongoing development
of China’s smart highway infrastructure has laid a solid foundation for the large-scale deployment
of RSUs, with implementation costs expected to decrease as installations scale up. As a result,
China’s V2X market for urban and intercity roads is poised for rapid growth, with the total
addressable market size exceeding RMB1 trillion.
(1)
Note:
(1) The total addressable market is calculated based on the installed base of vehicles, the length of urban roads and the
length of highways, assuming the penetration rate of OBUs in vehicles is 100% and the roadside devices are
installed at every signalized intersection on urban roads, as well as each kilometer on highways.
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Drivers of China’s V2X Industry
 Favorable Government Policy: Government support is a key driver for the development of
the V2X industry. The Chinese government introduced a series of policies related to
intelligent connected vehicles, including the construction of V2X infrastructure, the
promotion of intelligent vehicle applications, the improvement of cloud platforms and the
expansion of application scenarios. For example, (i) The government issued the Notice on
Designating the First Batch of Pilot Cities for the Coordinated Development of Smart City
Infrastructure and Intelligent Connected V ehicles in 2021. By establishing pilot zones and
test cities in specific regions, the government actively explores use cases and develops
replicable and scalable methodologies, attracting investments worth hundreds of billions to
the market. As of December 31, 2024, China has established 7 national V2X pilot zones and
16 dual-intelligence pilot cities, continuously expanding application scenarios and injecting
strong momentum into the industry’s growth; (ii) In 2024, five ministries have jointly
announced Notice on Launching the Integration V ehicle-Road-Cloud Application Pilot for
Intelligent Connected V ehicles , promoting the construction of vehicle-road-cloud integrated
systems, and V2X is gradually becoming a new driving force for the future growth of the
country’s automotive industry.
 Demand for Traffic Safety: Due to increasing private vehicle ownership and the growing
complexity of traffic conditions, the number of traffic accidents continues to rise, causing
economic losses of trillions of dollars annually. V2X can significantly reduce traffic
accidents, such as chain collisions and red-light running incidents, by communicating traffic
conditions and sending warnings to vehicles.
 Increased Demand for Urban Traffic Efficiency: As urbanization accelerates and
population density increases, the demand for fast and convenient travel grows. V2X
integrates information from vehicles, roadside infrastructure and cloud platforms, helping
traffic management authorities monitor traffic conditions, optimize routes and precisely
control traffic flow, thereby significantly improving efficiency and reducing congestion.
 Improved Smart Roadside Infrastructure: Continuously improved roadside infrastructure
has laid a solid foundation for the application of V2X. Technologies such as RSUs, sensing
devices and edge computing enable real-time data collection and information exchange
between roads and vehicles, supported by intelligent algorithms for data processing and
integration. As more smart roadside devices are deployed in the future, V2X will continue to
advance.
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 Enhanced Feasibility of V2X Deployment : With advancements in intelligent sensing,
artificial intelligence and 5G communication, along with the gradual establishment of pilot
zones, China’s V2X technology is becoming increasingly mature. V2X’s economic benefits
are steadily improving, significantly enhancing its deployment ability and establishing a
critical foundation for the future development of smart transportation.
OVERVIEW OF CHINA’S INTELLIGENT PERCEPTION SOLUTIONS FOR RAIL
TRANSIT AND COMMERCIAL VEHICLES INDUSTRY
Overview of Intelligent Perception Solutions for Rail Transit and Commercial Vehicles
Intelligent perception solutions utilize various sensors, such as cameras, radar, LiDAR and
mmWave radar, along with AI algorithms and data processing technologies, to actively monitor
and perceive the surrounding environment, vehicle conditions and driver status. These systems
provide strong support for the safe operation and efficient management of rail transit and
commercial vehicles. Key functions of intelligent perception solutions include smart object
detection and classification, AEB (Automatic Emergency Braking), BSD (Blind Spot Detection),
FCW (Forward Collision Warning), LDW (Lane Departure Warning) and DMS (Driver Monitoring
System), etc..
The primary challenge in rail transit is the real-time assessment of the operating environment
ahead, which is crucial for ensuring the safety of train operations. Similarly, in commercial vehicle
operations, the large size and limited driver visibility often result in significant blind spots.
Intelligent perception solutions effectively address these challenges by providing the following
functionalities:
For Rail Transit:
1. Intelligent perception solutions enable real-time environmental perception ahead of the
train, allowing for timely obstacle detection and emergency braking. This addresses the
limitations of signaling systems, which cannot directly monitor track conditions, thereby
significantly enhancing operational safety.
2. Intelligent perception solutions serve as a redundancy system that complements existing
signaling systems, potentially expediting fault recovery during system failures.
3. Intelligent perception solutions can reduce trains’ reliance on trackside equipment,
thereby lowering the overall construction costs of signaling systems, given the high
expense of covering the full lengths of tracks.
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For Commercial Vehicles:
1. Provide intelligent solutions for commercial vehicle drivers, with products installed as
components on commercial vehicles to monitor the surrounding environment, vehicle
status and driver behavior in real-time, enhancing driving safety and reducing traffic
accidents.
According to CIC, the market size of China’s intelligent perception solutions for rail transit
and commercial vehicles reached RMB1.3 billion in 2024 and is projected to grow to RMB10.2
billion by 2030, at a CAGR of 41.4% from 2024 to 2030. The potential market size for these
solutions in China is also substantial, with a total addressable market size
(1) of approximately
RMB530.0 billion in 2024.
Drivers of the China’s Intelligent Perception Solutions for Rail Transit and Commercial
Vehicles market
 Heightened Safety Demand: The increasing volume of traffic and the growing complexity of
road conditions have made it imperative for commercial vehicles to prioritize reducing
accidents and ensuring the safety of drivers and cargo. Meanwhile, rail transit, as a crucial
component of urban transportation with significant daily passenger volumes, also plays a vital
role in public safety. Utilizing advanced sensing and control technologies, intelligent
perception solutions significantly enhance transportation safety of rail transit and commercial
vehicles and reduced accident risks, leading to increased demand for rail transit and
commercial vehicles.
 Technological Advancement: Technological advancements, such as artificial intelligence and
big data analytics, lay the foundation for the intelligent transformation of rail transit and
commercial vehicles. For instance, AI algorithms based on computer vision can efficiently
process images and accurately identify objects, enabling real-time detection of obstacles
ahead of trains and enhancing operational safety.
 Favorable Policy: The Chinese government prioritizes the safe operation of commercial
vehicles and development of smart urban transportation. Various policies have given clear
direction for promoting intelligent perception solutions and supporting relevant enterprises
with financial subsidies, tax incentives, and research funding.
Note:
(1) The total addressable market is calculated based on the installed base of rail transit and commercial vehicles,
assuming the penetration rate is 100%.
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SOURCE OF INDUSTRY INFORMATION
We commissioned CIC to conduct research on, provide an analysis of, and to produce the
CIC Report on the commercial vehicle intelligent driving industry in China. CIC is an independent
market research and consulting company that provides industry consulting services, commercial
due diligence, and strategic consulting services to both institutional investors and corporations.
We have agreed to pay RMB805,000 to CIC for the preparation of the CIC Report. CIC
conducted both primary and secondary research. Primary research involved interviewing key
industry experts and leading industry participants. Secondary research involved analyzing data
from publicly available data sources, such as National Bureau of Statistics of China and public
disclosure by relevant industry players, among others.
CIC’s projection on the market sizes of the above-mentioned industries in China are based on
the following assumptions: (i) the overall global social, economic and political environment is
expected to maintain a stable trend over the next decade; (ii) related key industry drivers are likely
to continue propelling growth in these industries in China during the forecast period; and (iii)
there are no extreme force majeure events or industry regulation changes which may dramatically
or fundamentally affect the market situation. Our Directors confirm that, after making reasonable
enquiries, there has been no adverse change in the market information since the date of the CIC
Report that may qualify, contradict or have a material impact on the information in this section.
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Our business have been and will continue to be governed by relevant PRC laws and
regulations. The PRC government authorities promulgate and enforce relevant PRC laws and
regulations, including national and regional laws and regulations. This section contains a summary
of the major regulatory and legal requirements that are currently relevant to the Company’s
business. As the relevant PRC laws and regulations are still evolving, it is difficult for us to
predict the impact of such changes on our business and the additional compliance costs.
LA WS AND REGULATIONS RELATING TO OVERSEAS LISTING
Trial Administrative Measures of Overseas Securities Offering and Listing of Domestic
Companies
On February 17, 2023, upon approval by the State Council, the China Securities Regulatory
Commission (the “ CSRC”) released the Trial Administrative Measures of Overseas Securities
Offering and Listing by Domestic Companies ( )
(the “ Trial Administrative Measures ”) and five supporting guidelines, which came into effect on
March 31, 2023. The Trial Administrative Measures significantly reformed the regulatory system
of the direct or indirect offering of securities and listing by PRC domestic enterprises in overseas
markets to a filing system.
According to the Trial Administrative Measures, (i) a domestic enterprise in the PRC that
directly or indirectly issues securities outside the PRC or lists and trades its securities outside the
PRC shall file with the CSRC and submit the relevant materials; if a domestic enterprise fails to
comply with the procedures for filing, or if there are false records, misleading statements or
material omissions in the filed materials, such domestic enterprise may be subject to administrative
penalties such as rectification order, warnings, fines, and so forth, and the controlling shareholders,
actual controllers, officers in charge and other persons directly responsible who instigate others to
do the aforesaid illegal acts or concealing the relevant matters that have led to the occurrence of
the aforesaid circumstances may also be subject to administrative penalties such as warnings,
fines, and so forth; (ii) the direct overseas issuance of shares and listing of a domestic enterprise
refers to the overseas issuance and listing of shares of a joint stock limited company registered and
established in the PRC; and (iii) any domestic joint stock limited company shall file a report with
the CSRC within three working days after the submission of its application for an overseas listing.
A PRC domestic enterprise that fails to complete the filing in accordance with the Trial
Administrative Measures may be ordered to make corrections, given a warning and fined not less
than RMB1 million and not more than RMB10 million by the CSRC.
In addition, overseas offering and listing by domestic companies shall abide by laws,
administrative regulations and relevant rules concerning foreign investment in China, state-owned
asset administration, industry regulation and overseas investment. Overseas offering and listing
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activities shall not disrupt domestic market order, harm state or public interest or undermine the
lawful rights and interests of domestic investors. A domestic company that seeks to offer and list
securities in overseas markets shall (i) abide by applicable laws, including the Company Law of
the People’s Republic of China and the Accounting Law of the People’s Republic of China,
administrative regulations and relevant state rules, and formulate the Articles of Association,
improve internal control system, standardize corporate governance and financial and accounting
practices; (ii) abide by national secrecy laws and relevant provisions and take necessary measures
to fulfill confidentiality obligations. Divulgence of state secrets or working secrets of state organs
is strictly prohibited. Provision of personal information, important data, etc. to overseas parties in
relation to overseas offering and listing of domestic companies shall be in compliance with
applicable laws, administrative regulations and relevant state rules. Furthermore, the Trial
Administrative Measures also stipulates that no overseas offering and listing shall be made under
any of the following circumstances (among others) (i) where such fund-raising by listing is
explicitly prohibited by provisions in Chinese laws, administrative regulations or relevant state
rules; (ii) where the overseas offering and listing may endanger national security as reviewed and
determined by competent authorities under the State Council in accordance with laws; (iii) where
the domestic company makes the overseas offering and listing, or its controlling shareholders and
the actual controller, have committed crimes such as corruption, bribery, embezzlement,
misappropriation of property or undermining the order of the socialist market economy during the
latest three years; (iv) where the domestic company makes the overseas offering and listing is
suspected of committing crimes or major violations of laws and regulations, and is under
investigation according to laws, and no conclusion has yet been made thereof; or (v) where there
are material ownership disputes over equity held by the controlling shareholder(s) or by other
shareholder(s) that is/are controlled by the controlling shareholder(s) and actual controller.
Moreover, upon the occurrence of any of the material events specified below after an issuer
has offered and listed securities in an overseas market, the issuer shall submit a report thereof to
the CSRC within 3 working days after the occurrence and public disclosure of the event: (i)
change of control; (ii) investigations or sanctions imposed by overseas securities regulatory
agencies or other relevant competent authorities; (iii) change of listing status or transfer of listing
segment; (iv) voluntary delisting or mandatory delisting. Where an issuer’s main business
undergoes material changes after overseas offering and listing, and is therefore beyond the scope
of business stated in the filing documents, such issuer shall submit to the CSRC an ad hoc report
and a legal opinion issued by a domestic law firm within 3 working days after the occurrence of
the changes.
To enhance confidentiality and archive management for domestic enterprises’ overseas
offerings and listings, the CSRC, the Ministry of Finance of the People’s Republic of China (the
“MOF”), the National Administration of State Secrets Protection, and the National Archives
Administration revised relevant regulations. The updated Provisions on Strengthening
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Confidentiality and Archives Administration Concerning Overseas Securities Offerings and
Listings (CSRC Announcement [2009] No. 29) (੗ձᏦ
(ᗇ္ึʮѓ [2009]29 ໮)) were replaced with the Provisions on Strengthening
Confidentiality and Archives Administration Concerning Overseas Securities Offerings and
Listings by Domestic Enterprises (CSRC Announcement [2023] No. 44) (̋੶ྤʫΆุྤ̮
 (ᗇ္ึʮѓ [2023]44 ໮)) (the “ Provisions on
Confidentiality ”) on February 24, 2023. The Provisions on Confidentiality now covers domestic
joint stock limited companies seeking direct overseas issuance and listing and domestic operating
entities with subjects seeking indirect overseas issuance and listing. The Provisions on
Confidentiality outlines the procedural requirements and specify enterprises’ confidentiality
responsibilities and accounting archives administration, in alignment with the Trial Administrative
Measures. Pursuant to the Provisions on Confidentiality, where a domestic enterprise provides or
publicly discloses to the relevant securities companies, securities service institutions, overseas
regulatory authorities and other entities and individuals, or provides or publicly discloses through
its overseas listing subjects, documents and materials involving state secrets and working secrets
of state organs, it shall report the same to the examination and approval department for approval in
accordance with the law, and submit the same to the secrecy administration department of the same
level for filing. Domestic enterprises providing accounting archives or copies thereof to such
entities as securities companies, securities service institutions and overseas regulatory authorities
and individuals shall perform the corresponding procedures pursuant to the relevant provisions of
the State.
Regulations Relating to the H Share Full Circulation
“Full circulation” means listing and circulating on the Stock Exchange of the domestic
unlisted shares of an domestic H-share listed company, including domestic unlisted shares held by
domestic shareholders prior to overseas listing, domestic unlisted shares additionally issued after
overseas listing, and unlisted shares held by foreign shareholders. On November 14, 2019, the
CSRC issued the Guidelines for the “Full Circulation” Program for Domestic Unlisted Shares of
H-share Listed Companies ( Hˏ ) (the
“Guidelines for the Full Circulation ”), which was revised on August 10, 2023. The Guidelines
for the Full Circulation allows certain qualified H-share listed companies and H-share companies
intended for listing to apply to the CSRC for full circulation.
According to the Guidelines for the Full Circulation, shareholders of domestic unlisted shares
may determine by themselves through consultation the amount and proportion of shares, for which
an application will be filed for circulation, provided that the requirements in the relevant laws and
regulations and the policies for state-owned asset administration, foreign investment and industry
regulation are met, and the H-share listed company may be entrusted to file with the CSRC. And
domestic companies limited by shares that have not been listed may file with the CSRC for full
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circulation at the time of their initial public offering and listing overseas. Moreover, according to
the Trial Administrative Measures, shareholders holding unlisted shares in China shall apply for
converting domestic unlisted shares held by them into overseas listed shares and listing them on
overseas trading venues for circulation in accordance with the relevant provisions of the CSRC,
and entrust the domestic enterprises to file with the CSRC.
On December 31, 2019, China Securities Depository and Clearing Corporation Limited and
the Shenzhen Stock Exchange jointly announced the Measures for Implementation of H-share “Full
Circulation” Business ( H) (the “ Measures for Implementation ”).
The businesses in relation to the H-share “full circulation” business, such as cross-border transfer
registration, maintenance of deposit and holding details, transaction entrustment and instruction
transmission, settlement, management of settlement participants, services of nominal holders, etc.,
are subject to the Measures for Implementation.
China Securities Depository and Clearing (Hong Kong) Company Limited also issued the
Guide to the Program for “Full Circulation” of H-shares of Shenzhen Branch of China Securities
Depository and Clearing Corporation Limited (ப΂ʮ̡ଉέʱʮ̡ Hٰ
) (the “ Guide to the Program ”) in September 2024, which stipulates
relevant escrow, custody, agent service, arrangement for settlement and delivery, risk management
measures and other relevant matters.
According to the Measures for Implementation of H-share “Full Circulation” Business and
the Guide to the Program, shareholders who apply for H Share “Full Circulation” (“ Participating
Shareholders ”) shall complete the cross-border transfer registration for conversion of relevant
domestic unlisted shares into H Shares before dealing in the shares, i.e., CSDC as the nominal
holder, deposits the relevant securities held by Participating Shareholders at China Securities
Depository and Clearing (Hong Kong) Company Limited (“ CSDCHK ”), and CSDCHK will then
deposit the securities at HKSCC in its own name, and exercise the rights to the securities issuer
through HKSCC, while HKSCC Nominees as the ultimate nominal shareholder will be listed on
the register of shareholders of H-share listed companies. According to the Guide to the Program
for “Full Circulation” of H-shares, H-share listed companies shall be authorized by Participating
Shareholders to designate the only domestic securities company (“ Domestic Securities
Company ”) to participate in the transaction of converted H shares. The specific procedures are as
follows:
Participating Shareholders submit trading orders of the converted H Shares through the
Domestic Securities Company, which transmits the orders to the Hong Kong Securities Company
designated by the Domestic Securities Company through Shenzhen Securities Communication Co.,
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LTD.; and Hong Kong Securities Company conducts corresponding securities transactions in the
Hong Kong market in accordance with the aforementioned trading orders and the rules of the Hong
Kong Stock Exchange.
According to the Guide to the Program for “Full Circulation” of H-shares, upon the
completion of the transaction, settlements between each of the Hong Kong Securities Company
and CSDCHK, CSDCHK and CSDC, CSDC and the Domestic Securities Company, and the
Domestic Securities Company and the Participating Shareholders, will all be conducted separately.
REGULATIONS AND POLICIES RELATING TO THE AUTONOMOUS DRIVING AND
INTELLIGENT CONNECTED VEHICLE INDUSTRY
Regulations and Industry Development Policies Relating to the Autonomous Driving and
Intelligent Connected Vehicle Industry
On December 27, 2017, the Ministry of Industry and Information Technology of the People’s
Republic of China (the “ MIIT”), the Ministry of Transport of the People’s Republic of China
(“MOT”) and the National Standardization Administration jointly released China’s intelligent
connected vehicle standard system — the Guidelines for the Construction of the National
Connected Vehicle Industry Standard System (Intelligent Connected Vehicles) (MIIT Lianke (2017)
No. 322) (یܸ( ౽ঐၣᑌӛԓ ))(߅[2017]332 ໮), as
amended on July 18, 2023, which make a systematic plan and deployment for China’s intelligent
connected vehicle standard system and established the Intelligent Connected Vehicles Sub
technical Committee of the National Automotive Standardization Technical Committee, coordinate
the construction of the standard system for intelligent connected vehicles. As of now, the first
phase of the construction of the intelligent connected vehicle standard system has been
successfully completed. Moreover, according to the construction method of the technical logical
structure and product physical structure of intelligent connected vehicles, taking into account
different functional requirements, product and technology types, and information flow between
various subsystems, the Guidelines for the Construction defines the standard system framework of
intelligent connected vehicles as four parts: “Foundation”, “General Specifications”, “Product and
Technology Applications”, and “Relevant Standards”. Foundation mainly includes three types of
basic standards, such as terminologies and definitions, classification and coding, identifications
and symbols of intelligent connected vehicles. General Specifications put forward the overall
requirements and specifications from the vehicle level, mainly including function evaluation,
human-machine interface, function safety and information safety. Product and Technology
Applications mainly cover the functions, performance requirements, and testing methods of core
technologies and applications of intelligent connected vehicles, such as information perception,
decision warning, auxiliary control, automatic control, and information interaction. Relevant
Standards mainly include communication protocols, the foundation of vehicle information
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communication, which mainly cover protocol specifications on medium, short-range
communication, wide area communication and other aspects of the realization of intelligent
information interaction among vehicles (persons, vehicles, roads, clouds, etc.), and they also
include standard specifications for software and hardware interface between various physical
layers and different application layers.
In order to implement the National Standardization Development Outline (࢝
), promote the high-quality development of the intelligent connected vehicle industry, and
accelerate the construction of an automobile power, the MIIT has revised and improved the
Guidelines for the Construction of the National Connected Vehicle Industry Standard System
(Intelligent Connected Vehicles) based on the development of the intelligent connected vehicle
technology industry, further formed the Guidelines for the Construction of the National Connected
Vehicle Industry Standard System (Intelligent Connected Vehicles) (2023 Edition) (ԓᑌၣପ
یܸ( ౽ঐၣᑌӛԓ )(2023و)), which provided that the government will
establish a standard system for intelligent connected vehicles that adapts to China’s national
conditions and is in line with international standards in stages based on the current status of
intelligent connected vehicle technology, industry needs, and future development trends. Moreover,
regarding the stage 1 to 2025, the government will systematically form a system of standards for
intelligent connected vehicles that can support the combined driving assistance and general
functions of autonomous driving and formulate and revise over 100 relevant standards for
intelligent connected vehicles to satisfy the demand for standardization of intelligent connected
automobile technology, industry development and government administration. Regarding the stage
2 to 2030, a standard system for intelligent connected vehicles that can support the coordinated
development of single-vehicle intelligence and connected vehicle empowerment will be fully
formed, and the government will formulate and revise more than 140 standards related to
intelligent connected vehicles, and establish an implementation effect evaluation and dynamic
improvement mechanism to satisfy the demand for full-scene application of combined driving
assistance, autonomous driving and networked functions. Furthermore, the government will
establish and improve a safety guarantee system, as well as a support system for software,
hardware, and data resources. The coordination of international standards and regulations in key
areas such as autonomous driving will reach an advanced level.
As one of the priority basic general standards proposed in the guidelines for the construction
of the standard system, the Taxonomy of Driving Automation for Vehicles ( ӛԓቷትІਗʷʱ
ॴ) was promulgated by the State Administration for Market Regulation and the National
Standardization Administration on August 20, 2021 and became effective on March 1, 2022, which
refers to the corresponding standard of Society of Automotive Engineers, and stipulates that the
standards for autonomous driving can be divided into: Level 0 (emergency assistance), Level 1
(partial driver assistance), Level 2 (combined driver assistance), Level 3 (conditionally automated
driving), Level 4 (highly automated driving) and Level 5 (fully automated driving). Specifically,
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Level 0 requires the driving automation system to have the capability to continuously detect and
respond to some objects and events, and when the driver requests the exit of the driving
automation system, the control right of the system should be immediately released. Level 1
requires the driving automation system to continuously perform vehicle lateral or longitudinal
motion control in a dynamic driving task on the basis of Level 0, and requires the driving
automation system to have the capability to detect and respond to some objects and events that
matches both lateral or longitudinal motion control of vehicles. Level 2 further requires the driving
automation system to satisfy the capabilities matching both lateral and longitudinal motion control
of vehicles. Level 3 mainly requires that the driving automation system be able to perform the full
range of dynamic driving tasks under its designed operating conditions after activation. Level 4
mainly requires that the driving automation system be able to automatically implement the
minimum risk strategy when the relevant event occurs and the user does not respond to the
intervention request. Furthermore, Level 5 requires that the driving automation system have no
restrictions on the designed operating range, except for commercial and regulatory restrictions and
be able to achieve fully automated driving.
In January 2022, the Ministry of Transport and the Ministry of Science and Technology
jointly issued the Outline for the Mid- to Long-Term Development of Technological Innovation in
the Transportation Sector (2021−2035) (ࠅ2021−2035
ϋ)), outlining initiatives to promote the development and large-scale application of autonomous
driving technology.
Regulations Relating to the Road Testing of Intelligent Connected Vehicles
The MIIT, the Ministry of Public Security of the People’s Republic of China (the “ MOPS”)
and the Ministry of Transport jointly issued the Rules for the Administration of the Road Testing
and Demonstrative Application of Intelligent Connected Vehicles (for Trial Implementation) ( ౽
ঐၣᑌӛԓ༸༩಻༊ၾͪᇍᏐ͜၍ଣ஝ᇍ (༊Б)) on July 27, 2021, which became effective on
September 1, 2021. Any entity intending to conduct road testing of autonomous driving vehicles
shall apply to the traffic management department of the public security organ for a temporary
license plate for each tested motor vehicle through the evidence (including materials such as
self-declaration on the road testing safety of the road testing subject (the intelligent connected
vehicle) confirmed by the relevant competent authority) and vouchers required by the Provisions
on the Registration of Motor Vehicles. To obtain the above-mentioned evidence and temporary
license plate, according to the Rules for the Administration of the Road Testing and Demonstrative
Application of Intelligent Connected Vehicles (for Trial Implementation), the subject under road
testing, the vehicle under road testing, and the driver under road testing must satisfy relevant
requirements, including: (i) must be an independent legal entity registered in PRC with the
capacity to conduct intelligent connected vehicles-related businesses such as manufacturing,
technological research and testing of vehicles and vehicle parts, which has established protocol to
test and assess the performance of autonomous driving functionalities and is capable of conducting
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real-time remote monitor of the vehicle under road testing, and with the ability of event recording,
analysis and reproduction of the vehicles under road testing and ensuring the network security of
the vehicle under road testing and the remote monitor platforms; (ii) the vehicle under road testing
must be equipped with a driving system that can switch between autonomous pilot mode and
human operating mode in a safe, quick and simple manner and allow real-time conversion to
human operating mode under any circumstance, that is, the driver of road test and demonstration
application should always be in the car to monitor the vehicle operation status and the surrounding
environment, and take corresponding measures in time when the vehicle is found to be in a state
that is not suitable for automatic driving or the system prompts the need for manual operation; (iii)
the tested vehicle must be equipped with the functions of recording, storing and online monitoring
the condition of the vehicle and be able to transmit real-time data of the vehicle, such as the
driving mode, location and speed; (iv) the subject under road testing must sign an employment
contract or a labor service contract with the driver of the tested vehicle, who must be a licensed
driver with more than three years’ driving experience and a track record of safe driving and is
familiar with the testing protocol for autonomous driving functionalities and proficient in operating
the road testing for vehicles; and (v) the subject under road testing must insure each tested vehicle
for at least RMB5 million against car accidents or provide a letter of guarantee covering the same.
In addition, during testing, the subject under road testing should post a noticeable identification
logo for an autonomous driving road test on each tested car, that is, the road test vehicle and
demonstration application vehicle body shall be marked with the words “Autonomous Driving
Road Test” or “Autonomous Driving Demonstration Application” in conspicuous colors
respectively to remind surrounding vehicles and other road users, but shall not interfere with
normal road traffic activities in the vicinity. And autonomous driving mode should not be used
unless in the road sections and areas specified in the self-declaration on safety. Meanwhile,
vehicles shall not illegally engage in road transportation business activities or carry dangerous
goods during road testing and demonstration applications. If the subject under road testing intends
to conduct road testing with the same or similar functions in the region beyond the administrative
territory of the certificate issuing authority, it may submit the original relevant materials to the
relevant competent authorities of the provincial or municipal governments where the road testing is
to be carried out and apply for a separate license plate. If such provincial or municipal government
permits the subject under road testing to hold a temporary license plate issued by other provinces
or municipalities to conduct road testing in its administrative region, the subject under road testing
may carry out the corresponding test after submitting the relevant materials.
On July 30, 2021, the MIIT promulgated the Opinions of the Ministry of Industry and
Information Technology on Strengthening the Administration of the Access of Intelligent
Connected Vehicle Manufacturers and Products (̋੶౽ঐၣᑌӛԓ͛ପΆ
จԈ), which provides that enterprises should strengthen data security
management ability and network security guarantee ability, strengthen management ability and
ensure product production consistency. Moreover, enterprises should strengthen product
management: (i) Enterprises should strictly perform the obligation of informing. Where the
enterprise produces automobile products with driving assistance and autonomous driving functions,
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it shall clearly inform the vehicle functions and performance limits, driver responsibilities,
human-computer interaction equipment indication information, function activation and exit
methods and conditions, and more; (ii) Enterprises should strengthen the safety management of
combined driving assistance products; (iii) Enterprises should strengthen the safety management of
autonomous driving function products; (iv) Enterprises should ensure reliable space-time
information services.
The MIIT, the MOPS, the Ministry of Housing and Urban-Rural Development, and the
Ministry of Transport jointly promulgated the Notice of Implementing the Pilot Program of Access
and On-Road Traffic of Intelligent Connected Vehicles (ɝձɪ༩ஷБ
) (the “ 2023 Pilot ”), which took effect on the same day. Pursuant to the 2023
Pilot, vehicle manufacturers are eligible for carrying out on-road testing for intelligent connected
vehicles equipped with autonomous driving functions (referred to as Level 3 autonomous driving
function (conditionally automated driving) and Level 4 autonomous driving function (highly
automated driving) as provided in the Taxonomy of Driving Automation for Vehicles) and ready
for mass production in restricted areas only after passing the product testing and safety assessment
conducted by the relevant authorities and obtaining the access approvals from the MIIT.
On November 21, 2023, the Ministry of Transport issued the Guidelines on Transportation
Safety Services for Autonomous Vehicles (for Trial Implementation)ਕ
༊Б, which provides relevant guidance for vehicles which are capable of performing
all dynamic driving tasks under designed operating conditions according to relevant national
standards and have obtained the access approvals from the MIIT, including but not limited to,
requirements for application scenarios, operators of autonomous vehicles, safety and security,
supervision and overall management.
At the same time, the Guidelines on Transportation Safety Services for Autonomous Vehicles
(for Trial Implementation) (یܸ( ༊Б)) make the following
provisions for autonomous vehicles driving on open roads: the use of autonomous vehicles for taxi
passenger transportation business activities can be carried out under good traffic conditions and
controllable traffic safety scenarios; prudently use autonomous vehicles for road passenger
transport business activities; autonomous vehicles can be used to engage in road cargo
transportation business activities under scenarios such as point-to-point trunk highway
transportation or urban roads with controllable traffic safety; it is prohibited to use autonomous
vehicles to engage in road dangerous goods transportation business activities.
The Rules for the Administration of the Road Testing and Demonstrative Application of
Intelligent Connected Vehicles (for Trial Implementation) ( ౽ঐၣᑌӛԓ༸༩಻༊ၾͪᇍᏐ͜၍
ଣ஝ᇍ(༊Б)) jointly issued by the MIIT, the MOPS and the Ministry of Transport on July 27,
2021, which became effective on September 1, 2021, make the following provisions for
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autonomous vehicles driving on open roads. The relevant authorities at the provincial and
municipal levels will select a number of typical road sections and areas within their jurisdictions
that are capable of supporting the realization of autonomous driving and connected functions for
intelligent connected vehicles to carry out road testing or demonstration applications, and
announce them to the society. The main body of road test and demonstration application and
drivers shall abide by national road traffic safety laws and regulations and carry out their work in
strict accordance with the time, road sections, areas and projects stated in the self-declaration of
safety for road test or demonstration application.
In addition, the Guidelines on Transportation Safety Services for Autonomous Vehicles (for
Trial Implementation) make the following provisions for autonomous vehicles driving in closed
scenarios. In order to safeguard transportation safety, autonomous vehicles carrying out road
transportation services should be carried out in designated areas and pass road traffic safety
assessments in accordance with the law. The use of autonomous vehicles to engage in urban public
automobile and tram passenger transport operation activities can be carried out in physically
closed, relatively closed or simple road conditions on fixed routes and in controllable traffic safety
scenarios.
The Technical Requirements for the Construction of Closed Test Sites for Autonomous
Driving (Ӌ ) (GB/T 43119-2023) was released on September
7, 2023 and came into effect on January 1, 2024, with the National Technical Committee on
Intelligent Transport Systems of Standardization Administration of China as the focal point and the
National Standardization Administration as the competent authority, and the aforesaid national
standard stipulates the general requirements for closed test sites for autonomous driving, road
body, plane intersection, traffic setup, and requirements for supporting test facilities and
supporting service facilities, and applies to the planning, design and construction of test sites
required for large, medium, small and micro passenger vehicles and heavy, medium, light and
micro cargo vehicles to carry out automated driving closed site tests.
The Guidance of Ministry of Transport on Promoting the Development and Application of
Autonomous Driving Technologies in Road Traffic (ආ༸༩ʹஷІਗቷትҦஔ
ኬจԈ) was issued by the Ministry of Transport on December 2, 2020 and
implemented on December 20, 2020, which stipulates the promotion of the pilot and demonstration
application of automated driving technologies for autonomous driving vehicles in closed
environments, especially supporting the autonomous driving for cargo transportation services.
Demonstration applications of autonomous driving for cargo transportation aligning with
operational needs are encouraged in relatively closed environments, such as ports, airports,
logistics stations, transportation infrastructure construction sites, and terminal postal services,
express delivery and other scenarios. After conducting thorough risk assessments and contingency
plans, these applications may be expanded to road freight, city delivery and other scenarios to
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offer safe, efficient, and intelligent logistics transportation services. Steady efforts will be made to
promote autonomous driving in passenger transport services. Aided driving technologies will be
promoted steadily in the applications of urban buses and road passenger transportation.
Exploration on demonstration applications of autonomous driving for public commuting in closed
rapid public traffic systems, industrial parks and other areas is supported. Based on technological
advancements and demonstration outcomes. After conducting thorough risk assessments and
contingency plans, these applications may be expanded to other passenger transport scenarios. A
development action plan for autonomous driving for passenger transport shall be formulated to
provide safe, convenient, and comfortable passenger transport services.
The Road Traffic Safety Law (Revised Proposal Draft) (ج( ᙄᇃ ))
was promulgated by the MOPS on March 24, 2021, which stipulates that vehicles with autonomous
driving functions should pass road testing on closed roads and venues, obtain a temporary driving
license, and conduct road testing at designated times, areas, and routes according to regulations.
Those who have passed the test and are allowed to be produced, imported, or sold in accordance
with the law, and those who need to travel on the road shall apply for a motor vehicle license
plate. Moreover, a vehicle with autonomous driving function and manual direct operation mode
should record real-time driving data when conducting road tests or travelling on the road. The
driver should be in the driver’s seat of the vehicle, monitor the operation status and surrounding
environment of the vehicle, and be ready to take over the vehicle at any time. In case of road
traffic safety violations or traffic accidents, the responsibility of the driver and the development
unit of the autonomous driving system shall be determined according to law, and the liability for
damages shall be determined in accordance with relevant laws and regulations. If a crime is
constituted, criminal responsibility shall be pursued in accordance with the law. And vehicles with
autonomous driving function but without manual direct operation mode shall be separately
stipulated by relevant departments of the State Council. Furthermore, the autonomous driving
function should be tested and qualified by a third-party testing agency engaged in automotive
related business with corresponding qualifications. On April 29, 2021, the SCNPC promulgated the
updated Road Traffic Safety Law (). As of the Latest Practicable Date, the
aforementioned provisions of the Road Traffic Safety Law (Revised Proposal Draft) have not been
formally adopted.
According to the Interim Provisions on Radio Management of Automobile Radar ( ӛԓཤ༺
) promulgated by the MIIT on November 16, 2021 and effective from March
1, 2022, the automobile radar equipment manufactured or imported for domestic sale or use shall
comply with the RF Technical Requirements for Automobile Radar and apply for the radio type
approval of the radio transmitting equipment from the national radio administration agency. The
Company’s business operations do not involve the manufacture or import of automotive radar
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equipment for domestic sale or use. Therefore, it is not required to apply for the radio type
approval of the radio transmitting equipment from the national radio administration agency
according to the Interim Provisions on Radio Management of Automobile Radar.
LA WS AND REGULATIONS RELATING TO FOREIGN INVESTMENT
The Foreign Investment Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷̮ਠҳ༟
,t h e“ FIL”), which was promulgated on March 15, 2019 and became effective on January 1,
2020, and the Implementing Regulations of the Foreign Investment Law of the People’s Republic
of China (ૢԷ ), which was promulgated in December 2019
and became effective, are the principal laws and regulations governing foreign investment in the
PRC and replace three previous major laws on foreign investments in China, namely, the
Sino-foreign Equity Joint Venture Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷ʕ̮
), the Sino-foreign Cooperative Joint Venture Law of the People’s Republic of
China ( ) and the Wholly Foreign-owned Enterprise Law of
the People’s Republic of China (), together with their respective
implementing rules and auxiliary provisions.
Pursuant to the FIL, “foreign investment” refers to investment activities conducted by foreign
natural persons, foreign enterprises or other foreign organizations directly or indirectly in the PRC,
which include the following circumstances: (i) foreign investors setting up foreign-invested
enterprises in the PRC solely or jointly with other investors, (ii) foreign investors obtaining shares,
equity interests, property portions or other similar rights and interests of enterprises within the
PRC, (iii) foreign investors investing in new projects in the PRC solely or jointly with other
investors, and (iv) investment made by foreign investors in other methods as specified in laws,
administrative regulations, or as stipulated by the State Council.
According to the FIL, China has implemented a reform of the foreign investment
management system, whereby China applies the management system of pre-establishment national
treatment and the Negative List for foreign investment. The Negative List will be issued, modified
or published upon approval by the State Council from time to time. Foreign investors shall not
invest in the prohibited fields as specified in the Negative List, and foreign investors who invest in
the restricted fields as specified in the Negative List shall comply with the special management
measures for restrictive access under the Negative List. For fields other than the prohibited and
restricted investment fields stipulated in the Negative List, management shall be conducted under
the principle of consistency for domestic and foreign investment. Foreign-invested enterprises
established before the implementation of the FIL may maintain their respective original form of
enterprise organization for a period of five years from January 1, 2020. The Group is a leading
supplier of autonomous driving technologies for commercial vehicles in China. Its principal
business focuses on R&D in autonomous mining trucks, logistics vehicles, V2X technologies, and
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intelligent perception solutions. It provides products and solutions based on its proprietary
technologies. Therefore, the actual business scope of the issuer and domestic companies, including
its business offering of 3D terrain modeling, do not involve fields prohibited or restricted under
the Negative List for foreign investment, which will not influence this issuance and listing.
On December 30, 2019, the Ministry of Commerce of the PRC and the State Administration
for Market Regulation (“ SAMR”), jointly promulgated the Measures for Information Reporting on
Foreign Investment (), which became effective on January 1, 2020.
Pursuant to the Measures for Information Reporting on Foreign Investment, where a foreign
investor carries out investment activities in China directly or indirectly, the foreign investor or the
foreign-invested enterprise shall submit the investment information to the competent commerce
department.
The Measures for the Security Review of Foreign Investment ()
was promulgated by NDRC and MOFCOM on December 19, 2020 and became effective on
January 18, 2021. China has established a working mechanism for conducting security reviews of
foreign investment, which is responsible for organizing, coordinating, and guiding such reviews.
The office of the working mechanism is located in the National Development and Reform
Commission. Led by the National Development and Reform Commission and MOFCOM, the
working mechanism is responsible for the daily work of the security reviews of foreign
investment. The Measures for the Security Review of Foreign Investment define foreign
investment as direct or indirect investment by a foreign investor in China, which includes (i)
investment in new onshore projects or establishment of enterprises individually or with foreign
investors; (ii) acquisition of equity or asset of onshore companies by merger and acquisition; and
(iii) onshore investment by and through any other means. Investment in key areas with bearing on
national security, such as major equipment manufacturing, important information technology and
internet products and services, key technologies and other important areas, which results in the
acquisition of de facto control of investee companies, shall be filed with the working mechanism
office before such investment is carried out.
LA WS AND REGULATIONS RELATING TO IMPORT AND EXPORT MANAGEMENT
Foreign Trade
According to the Foreign Trade Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷࿁
) (the “ Foreign Trade Law ”) promulgated by the Standing Committee of the National
People’s Congress (“ SCNPC ”) on May 12, 1994 and last amended on December 30, 2022, since
December 30, 2022, no registration of foreign trade operators is required. The PRC government
allows the free import and export of goods and technologies, unless otherwise provided by laws
and administrative regulations. Before December 30, 2022, pursuant to the pre-amendment Foreign
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Trade Law, a foreign trade operator who is engaged in the import and export of goods or
technologies shall apply to the competent foreign trade authority under the State Council or its
entrusted agencies for filing and registration, unless otherwise provided by the laws, administrative
regulations and requirements of the competent foreign trade authority under the State Council.
Where a foreign trade operator fails to do so, the customs shall not handle the formalities for
declaration and clearance of the goods imported or exported by the operator.
The Customs Law
According to the Customs Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷ऎᗫ
), which was promulgated by the SCNPC on January 22, 1987 and last amended on April 29,
2021, and became effective on the same date, the customs of the People’s Republic of China is the
state’s entry and exit customs supervision and administration authority. In accordance with the
relevant laws and administrative regulations, the customs are responsible for the supervision of the
transport vehicles, goods, luggage, postal items and other items entering into and departing from
the PRC, collecting tariff and other duties and charges, investigating and suppressing smuggling,
and preparing customs statistics and conducting other customs affairs.
Pursuant to the Administrative Provisions of the Customs of the People’s Republic of China
on the Filing of Customs Declaration Entities ( )
that was promulgated by the General Administration of Customs on November 19, 2021 and
became effective on January 1, 2022, customs declaration entities refer to the consignees,
consignors of goods imported or exported and customs declaration enterprises filed with the
customs. Where the consignee or consignor of goods imported or exported or a customs
declaration enterprise applies for filing, it shall obtain the qualification of market entities.
LA WS AND REGULATIONS RELATING TO PRODUCT QUALITY AND TORT LIABILITY
Product Quality
According to the Product Quality Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷
), which was promulgated by the SCNPC on February 22, 1993, and was amended
and became effective on July 8, 2000, August 27, 2009 and December 29, 2018, respectively, the
product quality supervision and administration departments of the State Council are responsible for
the supervision of product quality of the whole country. Manufacturers and sellers should establish
an internal product quality management system, strictly implement quality specifications for posts.
All relevant departments of the State Council shall be responsible for the supervision of product
quality within their own functions and duties. The local market supervision and administration
departments at the county level and above shall be responsible for the supervision of product
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quality in the relevant administrative regions. The relevant departments of the local people’s
governments at the county level and above shall be responsible for the supervision of product
quality within their respective scope of duties.
Tort Liability
Pursuant to the Civil Code of the People’s Republic of China (Պ)
(the “ Civil Code ”) issued by the National People’s Congress on May 28, 2020 and entered into
force on January 1, 2021, if defective products are identified after they have been put into
circulation, the manufacturers and the sellers shall take remedial measures such as stopping of
sales, issuance of a warning, recall of products, etc. in a timely manner. If the damage is caused by
a defective product or if the manufacturer or the seller fails to take remedial measures in a timely
manner, the aggrieved party may claim compensation from the manufacturer or the seller of such
product. Where a defect is caused by the fault of the seller, the manufacturer who has paid
compensation has the right to indemnification against the seller. Where any manufacturer or seller
knowingly produces or sells defective products or fails to take remedial measures in a timely
manner and thus causes death or serious damage to the health of another person, such person shall
be entitled to claim, in addition to compensation for loss, punitive damages.
LA WS AND REGULATIONS RELATING TO CYBER SECURITY, PROTECTION OF
PERSONAL INFORMATION AND DATA SECURITY
Regulations Relating to Cyber Security
The Chinese government has enacted laws and regulations on internet information security
and the protection of personal information from any abuse or unauthorized disclosure. From a state
security point of view, on December 28, 2000, the SCNPC enacted the Decision on the Protection
of Internet Security (), as amended on August 27, 2009, which
provides that any of the following activities will be subject to criminal liabilities if constituting a
crime: (i) gaining improper entry into any of the computer information systems relating to state
affairs, national defense construction, or cutting-edge science and technology; (ii) spreading rumor,
slander or other harmful information via the internet for the purpose of inciting subversion of the
state political power, overthrow of the socialist system, or inciting secession of the country or
undermining of national unity; (iii) stealing or divulging state secrets, intelligence or military
secrets via the internet; (iv) spreading false advertising of goods and services via the internet; or
(v) infringing on others’ intellectual property via the internet. The Ministry of Public Security of
the PRC (“ MOPS”) issued the Administrative Measures on Security Protection for International
Connections to Computer Information Networks ( )
on December 16, 1997, which was amended by the State Council on January 8, 2011. These
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measures prohibit using the internet to leak state secrets or to spread socially destabilizing content.
If an internet information service provider violates these measures, the competent authorities may
revoke its operating license and shut down its websites.
On November 7, 2016, the SCNPC promulgated the Cyber Security Law of the People’s
Republic of China () (the “ Cyber Security Law ”), which became
effective on June 1, 2017. According to the Cyber Security Law, network operators, including
internet information service providers, shall take technical and other necessary measures as
required by applicable laws, regulations and the compulsory requirements of national standards to
ensure the safe and stable operation of the network, respond to cyber security incidents effectively,
prevent illegal and criminal activities, and maintain the integrity, confidentiality and usability of
network data. The Cyber Security Law highlights that any individual or organization shall not
endanger cyber security, or engage in any illegal activities that, by making use of the network,
endanger the national security, economic order and social order, or infringe on the fame, privacy,
intellectual property and other legitimate rights and interests of others. The Cyber Security Law
also restates certain basic principles and requirements for the protection of personal information
previously stipulated in other existing laws and regulations, including those mentioned above. Any
internet information service provider that violates any provision or requirement in the Cyber
Security Law may be subject to warnings, confiscation of illegal income, fines, revocation of
business permits or licenses, closure of websites, and even criminal liability.
On December 28, 2021, the Cyberspace Administration of China (the “ CAC”) issued the
revised Measures for Cyber Security Review () (the “ Revised CAC
Measures ”), which became effective on February 15, 2022 and replaced the Measures for Cyber
Security Review promulgated on April 13, 2020. The Revised CAC Measures stipulates that if the
procurement of network products and services by a critical information infrastructure operator and
the data processing activities of a network platform operator affect or may affect national security,
it shall apply for cyber security review. According to Article 7 of the Revised CAC Measures, any
network platform operator with personal information of more than one million users shall apply to
the Cyber Security Review Office for cyber security review prior to listing abroad.
In accordance with the Revised CAC Measures, we are not applicable to the declaration of
cyber security review, on the basis that: (i) According to Article 10 of Regulations on the Security
Protection of Critical Information Infrastructure (ᚐૢԷ), the security
protection departments of critical information infrastructure will timely notify the identification
results to the operators. As of the Latest Practicable Date, we had not received such notification
from relevant government authorities regarding the identification as a CIIO. In addition, the
network products and services that we purchase and use are general network products and services
available in the marketplace without significant risks of supply chain disruption. Therefore, we
should not be deemed as an operator of critical information infrastructure. (ii) We have not
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received any material queries or notifications from the CAC or other PRC government authorities,
have not received any notification with regard to cyber security review, and have not been subject
to any material administrative penalties or other sanctions by any competent regulatory authorities
in relation to cyber security, data and personal information protection. (iii) Our business does not
involve the cross-border transfer of personal information and important data. (iv) We have
established a basic cyber security and data protection system pursuant to the Data Security Law of
the PRC and other applicable laws and regulations. (v) During the Track Record Period and up to
the Latest Practicable Date, there had not been a significant cyber security or data protection
incident regarding theft, leakage, damage or loss of data or personal information. (vi) Based on the
consultation with China Cybersecurity Review, Certification and Market Regulation Big Data
Center (the agency entrusted by the Cyber Security Review Office to carry out the specific work of
cyber security review), Hong Kong is not included in the definition of “abroad” hereof and listing
in Hong Kong is not in the scope of “listing abroad”, which is not required to apply for cyber
security review. (vii) The amount of personal information we process is very limited, not reaching
the threshold of one million.
Regulations Relating to the Protection of Personal Information and Data Security
On August 20, 2021, the Law of the People’s Republic of China on the Protection of Personal
Information (,t h e“ Personal Information Protection Law ”)
was promulgated by the SCNPC and came into effect on November 1, 2021. The Personal
Information Protection Law stipulates, among others, the circumstances under which a personal
information processor could process personal information, such as when (i) the individual’s
consent has been obtained; (ii) the processing is necessary for the conclusion or performance of a
contract to which the individual is a contracting party or for conducting human resource
management under the labor rules and regulations developed in accordance with the law and a
collective contract signed in accordance with the law; (iii) the processing is necessary to fulfill
statutory duties and statutory obligations; (iv) the processing is necessary to respond to public
health emergencies or protect natural persons’ life, health and property safety under emergency
circumstances; (v) the personal information that has been disclosed is processed within a
reasonable scope in accordance with Personal Information Protection Law; (vi) personal
information is processed within a reasonable scope to conduct news reporting, public
opinion-based supervision, or other activities in the public interest; or (vii) any other circumstance
provided by any law or administrative regulation occurs.
The Data Security Law of the PRC () (the “ Data Security
Law”) was promulgated by the Standing Committee of the National People’s Congress on June 10,
2021 and came into effect on September 1, 2021. The Data Security Law establishes a classified and
tiered protection system based on the data’s importance for economic and social development and the
degree of harm to national security, public interests, or the legitimate rights and interests of
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individuals and organizations if the data are tampered with, destroyed, divulged, or illegally acquired
or used. The “important data” as determined by the competent government authorities should be
treated with a higher level of protection. State export controls shall be imposed on data related to the
safeguarding of national security and interests and the fulfillment of international obligations. In
addition, the Data Security Law stipulates that processors of important data shall specify the person in
charge of data security and the management organization, and implement the responsibility for data
security protection, and that such processors shall carry out regular risk assessments of their data
processing activities and submit risk assessment reports to the relevant competent authorities. In
violation of the Data Security Law, the relevant entity or person may be ordered to make corrections,
given a warning, subject to fines, suspension of operations, revocation of relevant business permits or
licenses, or even subject to criminal liabilities.
Moreover, in accordance with the Cyber Security Law: (i) to collect and use personal
information, network operators shall follow the principles of legitimacy, rightfulness and necessity,
disclose rules of data collection and use, clearly express the purposes, means and scope of
collecting and using the information, and obtain the consent of the persons whose data is gathered;
(ii) network operators shall neither gather personal information unrelated to the services they
provide, nor gather or use personal information in violation of the provisions of laws and
administrative regulations and the agreement between both parties; and shall dispose of personal
information they have saved in accordance with the provisions of laws and administrative
regulations and agreements reached with users; (iii) network operators shall not divulge, tamper
with or damage the personal information they have collected, and shall not provide the personal
information for others without the consent of the persons whose data is collected, except where it
has been processed in such a manner that it is not traceable to a specific person and not
recoverable. Furthermore, pursuant to the Cyber Security Law, personal information and important
data collected and generated by critical information infrastructure operators in their operations
within China shall be stored in China.
On September 24, 2024, the State Council promulgated the Regulation on Network Data
Security Management ( ၣഖᅰኽτΌ၍ଣૢԷ) (the “ Network Data Security Regulations ”),
which came into effect on January 1, 2025. The Network Data Security Regulations harmonized
the current legislation on cybersecurity and data protection on an administrative regulation level,
covering a wide range of topics, including without limitation personal information processing,
important data security, regulations on network security products and services, incident report
obligations, cross-border data transfer, the responsibilities of internet platform providers. The
Network Data Security Regulations define important data as the data in a specific field, group or
region or with a certain precision and scale, which, once tampered with, destroyed, divulged,
illegally obtained or illegally used, may directly endanger national security, economic operation,
social stability, public health and security. Handlers of important data shall conduct risk
assessment prior to providing, entrusting others to process or jointly processing important data,
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except for the performance of statutory duties or obligations. It is also stipulated by the Network
Data Security Regulations that, where network data handlers carry out network data processing
activities that affect or may affect national security, they shall undergo a national security review
in accordance with relevant national regulations.
The Several Provisions on Administration of Automobile Data Security (For Trial
Implementation) (֛( ༊Б)) (the “ Provisions on Automobile Data
Security ”) was jointly promulgated by the CAC, the MIIT and other government authorities on
August 16, 2021 and became effective on October 1, 2021. In accordance with the Provisions on
Automobile Data Security, automobile data include both personal information and important data
involved in the process of automotive design, production, sales, use, operation and maintenance.
“Important data” means data that may endanger national security, public interest, the legitimate
rights and interests of individuals and organizations once tampered with, destroyed, divulged, or
illegally acquired or used. Automobile data processors are defined as entities that carry out
automobile data processing activities, including automobile manufacturers, components and parts
and software suppliers, dealers, maintenance organizations, and mobility service enterprises. They
shall carry out automobile data processing activities (including the collection, storage, use,
processing, transmission, provision, and disclosure of automobile data) in accordance with the
Provisions on Automobile Data Security. The automobile data processors shall carry out risk
assessments for their important data processing activities and submit a report to relevant
government authorities. Important data shall be stored in China in accordance with the law.
Automobile data processors that have to carry out cross-border data transfers due to business needs
shall pass the security assessment organized by the CAC in conjunction with the relevant
authorities under the State Council, and shall follow the purpose, scope, mode, and type and size
of the data specified in the security assessment of cross-border data transfers.
Moreover, On July 7, 2022, the CAC promulgated the Measures for Security Assessment of
Cross-border Data Transfers (), which took effect on September 1, 2022.
According to the Measures, a data processor shall, through the local cyberspace administration at
the provincial level, apply to the national cyberspace administration for security assessment of
cross-border data transfers when it provides data for a recipient outside the PRC under any of the
following circumstances: (i) where a data processor transfers important data to overseas recipients;
(ii) where a critical information infrastructure operator or a data processor processing the personal
information of more than one million individuals transfers personal information to overseas
recipients; (iii) where a data processor, who has provided personal information of 100,000
individuals, or sensitive personal information of 10,000 individuals in total since January 1 of the
previous year, transfers personal information to overseas recipients; and (iv) other circumstances
prescribed by the CAC for which declaration for security assessment for cross-border data
transfers is required. As of the Latest Practicable Date, our business does not involve any
cross-border transfer of personal information and important data. Therefore, the Measures for
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Security Assessment of Cross-border Data Transfers does not apply to us. In the future, if it is
necessary to transfer personal information or important data to overseas recipients for business
purposes, we will fulfill our obligation to go through the cross-border transfer formalities in
advance.
Cloud platforms serve as the data processing center and are used by customers to process
various types of personal information including end-user registration information, basic vehicle
information, location and trajectory data, etc. The cloud platforms are locally deployed on the
customer’s own server. We may remotely access and process data on the cloud platforms for
operation and maintenance purposes. The scope of personal information we may remotely access is
dependent on the operation or maintenance purposes and within the scope authorized by the
customers. We do not collect or store any data from the cloud platforms. If we will process
personal information in China during future overseas expansion, we would need to abide by the
PRC laws on cybersecurity and data protection to the extent applicable.
As of the Latest Practicable Date, we had not been subject to any material administrative
penalties, mandatory rectifications, or other sanctions by any competent regulatory authorities in
relation to cybersecurity and data protection, nor had there been any material cybersecurity and
data protection incidents relating to data leakage, violation of data protection laws or regulations,
or any investigations or other legal proceedings against us in relation thereto. Based on the above
facts and confirmed by our PRC legal adviser as to data security laws, our Directors believe that
as of the Latest Practicable Date, we have complied with the Cyber Security Law, the Data
Security Law, and the Personal Information Protection Law in all materials aspects.
LA WS AND REGULATIONS RELATING TO INTELLECTUAL PROPERTY
Trademarks
According to the Trademark Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷ਠᅺ
), which was promulgated by the SCNPC on August 23, 1982 and revised respectively on
February 22, 1993, October 27, 2001, August 30, 2013, and April 23, 2019, and became effective
on November 1, 2019, and the Implementing Regulations of the Trademark Law of the People’s
Republic of China (ૢԷ), which was promulgated by the State
Council on August 3, 2002 and revised on April 29, 2014, and became effective on May 1, 2014,
the Trademark Office of the administrative department for industry and commerce under the State
Council shall take charge of matters concerning trademark registration and administration in
China. The valid period of a registered trademark shall be ten years from the date of approval of
the registration. Upon expiry of the valid period, the registrant shall go through the formalities for
renewal within twelve months prior to the date of expiry as required if the registrant needs to
continue to use the trademark. If the registrant fails to do so within the period, an extension period
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of six months may be granted. The valid period for each renewal of registration shall be ten years.
Where an applicant for trademark registration files an application for trademark registration in
China within six months of filing the first application for registering the same trademark for the
same goods in a foreign country, the applicant may have priority in accordance with any agreement
concluded by and between the PRC and the foreign country concerned, or with the international
treaty to which both countries are parties, or on the basis of the principle of priority recognized by
both parties. In the event that an applicant uses a trademark for the first time on goods displayed
at an international exhibition organized or recognized by the Chinese government, the applicant
may be entitled to priority provided that it files an application to register the trademark within six
months from the date of the exhibition. The trademark registrant may, by concluding a trademark
licensing contract, authorize other persons to use its registered trademark. The licensor shall
supervise the quality of the goods on which the licensee uses the licensor’s registered trademark,
and the licensee shall guarantee the quality of the goods on which the registered trademark is used.
The party authorized to use others’ registered trademark shall indicate the name of the licensee and
the place of origin on the goods that bear the registered trademark. When granting others to use
the registered trademarks, the licensor shall file the license of the trademarks with the Trademark
Office for record, which shall announce the same. Without putting the licensing of the trademark
on records, the trademark shall not be effective against a bona fide third party.
Patent
According to the Patent Law of the People’s Republic of China (),
which was promulgated by the SCNPC on March 12, 1984 and revised on September 4, 1992,
August 25, 2000, December 27, 2008 and October 17, 2020 respectively, and became effective on
June 1, 2021, and the Rules for Implementation of the Patent Law of the People’s Republic of
China (), which was promulgated by the State Council on June
15, 2001 and revised on December 28, 2002, January 9, 2010, December 11, 2023, and became
effective on January 20, 2024, the patent administration department under the State Council shall
be responsible for the patent-related work in China. It accepts and examines patent applications in
a uniform way and grants patent rights in accordance with the law. The Patent Law of the People’s
Republic of China and its implementation rules provide for three types of patents, “invention”,
“utility model” and “design”. An invention or a utility model for which a patent is granted shall be
novel, inventive and practical. Any design for which patent right may be granted shall not be an
existing design, nor has any entity or individual filed before the date of filing with the patent
administration department under the State Council an application relating to the identical design
disclosed in patent documents announced after the date of filing. The term for patent right of
invention is 20 years, and for utility model and design, it is 10 years and 15 years, respectively, all
calculated from the date of application.
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Copyright and Software Registration
In accordance with the Copyright Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷
), which was promulgated by the SCNPC On September 7, 1990 and amended on
October 27, 2001, February 26, 2010, and November 11, 2020, respectively, and became effective
on June 1, 2021, Chinese citizens, legal persons, or unincorporated organizations shall, whether
published or not, enjoy copyright in their works. “Works” include written works, oral works,
musical, dramatic, quyi, dance, acrobatic works, fine arts, architectural works, photography works,
audio-visual works, graphic works (such as engineering design drawings, product design drawings,
maps, schematic diagrams) and model works, computer software and other intellectual
achievements which comply with the characteristics of the works.
According to the Regulations for the Implementation of the Copyright Law of the People’s
Republic of China (ૢԷ), which was promulgated by the State
Council on August 2, 2002, became effective on September 15, 2002 and was last amended on
January 30, 2013, copyright holders shall be entitled to a variety of personal and property rights,
including the publication right, the right of signature, the right of reproduction, and the right of
information network transmission.
The Computer Software Protection Regulations (ᚐૢԷ) promulgated by the
State Council on June 4, 1991 and amended in 2001, 2011 and 2013 respectively, aim to protect
the rights and interests of computer software copyright owners, adjust the interests in the
development, dissemination and use of computer software, encourage the development and
application of computer software, and boost the development of the software industry and the
informatization of the national economy. In accordance with the Computer Software Protection
Regulations, Chinese citizens, legal persons or other organizations shall be entitled to the
copyright for software developed by them, whether published or not. A software copyright owner
may apply for registration with the software registration agency recognized by the copyright
administrative department under the State Council. The registration certificate issued by the
software registration agency is the preliminary proof of the registered matters.
According to the Measures for the Registration of Computer Software Copyright (ၑዚழ
) promulgated by the National Copyright Administration on February 20, 2002
was included in and revised by the Computer Software Protection Regulations which was amended
by the State Council on January 30, 2013 and entered into force on March 1, 2013, the National
Copyright Administration shall be in charge of the registration and administration of software
copyrights nationwide and the China Copyright Protection Center has been recognized as a
software registration agency.
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Domain Names
According to the Measures for the Administration of Internet Domain Names ( ʝᑌၣਹΤ
) promulgated by the MIIT on August 24, 2017, which came into effect on November 1,
2017, the MIIT shall be responsible for the supervision and management of China’s Internet
domain name service. Domain name registrations shall be handled through the domain name
service agencies established in accordance with the relevant provisions, and the applicants become
domain name holders upon successful registration.
Trade Secrets
According to the Anti-Unfair Competition Law of the People’s Republic of China ( ʕശɛ͏
), promulgated by the SCNPC in September 1993 and amended on
November 4, 2017 and April 23, 2019 respectively, the term “trade secrets” refers to technical
information, operational information, and other commercial information that is unknown to the
public, has commercial value, and is maintained as secrets by its right holders.
Under the Anti-Unfair Competition Law of the People’s Republic of China, operators are
prohibited from infringing others’ trade secrets by: (i) obtaining the trade secrets from the right
holders by any unfair methods by theft, bribery, fraud, intimidation, electronic intrusion or other
improper means; (ii) disclosing, using or permitting others to use the trade secrets of the right
holders obtained illegally under item (i) above; (iii) disclosing, using or allowing others to use
trade secrets obtained by him/her in violation of confidentiality obligations or the right holders’
requirements on keeping such trade secrets confidential; or (iv) disclosing, using or allowing
others to use the right holders’ trade secrets by instigating, inducing or helping others to violate
the confidentiality obligations or the holders’ requirements on keeping such trade secrets
confidential. Where a third party knows or should have known any of the illegal acts specified in
the preceding items, but still obtains, uses or discloses such trade secrets, the third party may be
deemed to have committed an infringement of the others’ trade secrets. The party whose trade
secrets are being infringed may petition for administrative corrections, and regulatory authorities
may stop any illegal acts and fine the infringing party.
LA WS AND REGULATIONS RELATING TO LEASING
Pursuant to the Law on Administration of Urban Real Estate of the People’s Republic of
China (), which was promulgated by the SCNPC on July 5,
1994 and latest amended on August 26, 2019, and became effective on January 1, 2020, in case of
house leasing, the lessor and lessee are required to enter into a written lease contract, containing
such provisions as the leasing term, usage, rental and repair liabilities, as well as other rights and
obligations of both parties, and go through registration and filing procedures with the real estate
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administration department. According to the Administrative Measures for Commercial Housing
Leasing (), which was promulgated by the Ministry of Housing and
Urban-Rural Development of the People’s Republic of China on December 1, 2010, and became
effective on February 1, 2011, without the above-mentioned registration, the competent department
of construction (real estate) shall order corrections within a specified time limit. If corrections are
not made by the deadline, a fine may be imposed on the lessor and the lessee. In accordance with
the Civil Code, the lessee may, with consent from the lessor, sub-let the leased item to a third
party. The lease contract between the lessee and the lessor shall continue to be valid if the lessee
sub-lets the leased item. In the event that the lessee sub-lets the leased item without consent from
the lessor, the lessor may terminate the lease contract. In addition, any change of ownership to the
lease item does not affect the validity of the lease contract.
LA WS AND REGULATIONS RELATING TO ENVIRONMENTAL PROTECTION
The Environmental Protection Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷ᐑྤ
), which was last amended on April 24, 2014 and became effective on January 1, 2015,
outlines the authorities and duties of various environmental protection regulatory agencies. The
Ministry of Environmental Protection is authorized to issue national standards for environmental
quality and emissions, and to monitor the environmental protection scheme of the PRC.
Meanwhile, local environmental protection authorities may formulate local standards which are
more rigorous than the national standards, in which case, the concerned enterprises must comply
with both the national standards and the local standards.
According to the Administrative Regulations on the Environmental Protection of Construction
Projects (ᚐ၍ଣૢԷ) (the “ Environmental Protection Rules of Construction
Projects ”), promulgated by the State Council on November 29, 1998 and amended on July 16,
2017, and other relevant environmental protection laws and regulations, construction units shall
compile or fill out an environmental impact report, an environmental impact statement, or an
environmental impact registration form prior to the commencement of any construction project and
submit it to the relevant environmental protection administration authority for approval or
record-filing. Construction entities may entrust a technical entity to conduct an environmental
impact assessment of its construction projects and prepare environmental impact reports and
environmental impact statements on construction projects. If a construction entity has the technical
capability of environmental impact assessment, it may carry out the above activities itself.
According to the Environmental Impact Assessment Law of the People’s Republic of China
(), promulgated by the SCNPC on October 28, 2002 and
amended on July 2, 2016 and December 29, 2018 respectively, for any construction project that
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has an impact on the environment, the construction entity concerned is required to prepare either a
report or a statement, or fill in a registration form of such environmental impacts depending on the
seriousness of effect that may be exerted on the environment.
According to the Environmental Protection Rules of Construction Projects, after the
completion of a construction project for which the environmental impact report or the
environmental impact statement has been prepared, the construction entity shall, in accordance
with the standards and procedures established by the competent administrative department of
environmental protection under the State Council, conduct acceptance checks of the environmental
protection facilities and prepare an acceptance report, and announce the acceptance report
according to law except for circumstances where there is a need to keep confidentiality pursuant to
the provisions of the State. Any construction project for which the environmental impact report or
the environmental impact statement has been prepared can not be put into operation or use until its
environmental protection facilities have passed the inspection and acceptance.
The Interim Measures for Environmental Protection Inspection and Acceptance upon
Completion of Construction Projects ( ) was promulgated
and implemented by the former Ministry of Environmental Protection (now the Ministry of
Ecology and Environment) on November 20, 2017. The Measures stipulates the procedures and
standards for construction entities to carry out independent environmental protection inspection
and acceptance upon the completion of construction projects.
LA WS AND REGULATIONS RELATING TO WORK SAFETY
Under relevant construction safety laws and regulations, including the Work Safety Law of
the People’s Republic of China () (the “ Work Safety Law ”), which
was promulgated by the SCNPC on June 29, 2002 and latest amended on June 10, 2021, and
became effective on September 1, 2021, production and operating business entities must establish
objectives and measures for work safety and improve the working environment and conditions for
workers in a planned and systematic way. A work safety protection scheme must also be
established to implement the work safety job responsibility system. In addition, production and
operation entities must arrange work safety training and provide the employees with personal
protective equipment that meets the national standards or industrial standards.
Pursuant to the Work Safety Law, and the Measures for the Supervision and Administration of
“Three Simultaneities” for Safety Facilities of Construction Projects (ɧΝ
), which was promulgated by the State Administration of Work Safety (now
has been adjusted to the Ministry of Emergency Management) on April 2, 2015 and became
effective on May 1, 2015, production and operation entities are responsible for the construction of
the safety facilities of construction projects. The safety facilities of a construction project must be
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designed, constructed and put into production and use simultaneously with the main part of the
project. Investment in safety facilities shall be brought into the budgetary estimate of the
construction project.
LA WS AND REGULATIONS RELATING TO FIRE PROTECTION
Fire Protection Design Review and Final Acceptance
According to the Interim Provisions on the Administration of Examination and Acceptance of
Fire Protection Design of Construction Projects ( ),
which was promulgated by the Ministry of Housing and Urban-Rural Development on April 1,
2020 and became effective on June 1, 2020, and was latest amended on August 21, 2023, the fire
protection design review system shall apply to special construction projects for movie theaters,
reading rooms in public libraries, commercial indoor fitness and recreation venues, outpatient
buildings in hospitals, teaching buildings, libraries and canteens in universities, production and
processing workshops in labor-intensive enterprises, temples and churches, each of which has a
gross floor area of more than 2,500 square meters. Where an as-built special construction project
undergoes the final acceptance formalities, the construction entity shall file an application for fire
protection final inspection with the competent department of fire protection design review and
final acceptance; where the project fails to undergo or pass the fire protection design review, it
shall be prohibited from being put into use. The recordation and random inspection system shall
apply to the classified management of other construction projects. Any other construction project
that fails to pass the random inspection conducted under the law shall cease to be used.
According to the Fire Protection Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷ऊ
) promulgated by the SCNPC on April 29, 1998 and latest amended on April 29, 2021,
where a construction project subject to fire protection acceptance according to law that has not
undergone or failed to pass the fire protection acceptance shall not be put into use; and any other
construction project that failed to pass the random inspection conducted under the law shall cease
to be used. Where any of the following conduct is committed in violation of any provision of this
Law, the competent housing and urban-rural development department and the fire protection and
rescue authority shall, in accordance with their respective powers, order cessation of construction
or use, or suspension of production or business, and impose a fine of not less than RMB30,000 nor
more than RMB300,000: a construction project that is subject to fire protection design review
according to law has not undergone or failed to pass the review and is under construction without
authorization; a construction project that is subject to fire protection acceptance inspection
according to law has not undergone or failed to pass the fire protection acceptance and is put into
use without authorization; and any other construction project that failed to pass the random
inspection conducted under the law has not ceased to be used.
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LA WS AND REGULATIONS RELATING TO FOREIGN EXCHANGE
Under the Foreign Exchange Administration Regulations of the People’s Republic of China
(ʕശɛ͏΍ձ਷̮ි၍ଣૢԷ) which was latest amended in 2008 and various regulations
issued by the State Administration of Foreign Exchange and other relevant PRC government
authorities, Renminbi is freely convertible for current account items, such as trade-related receipts
and payments, interest and dividends. For capital account items, such as direct equity investment,
loan or investment return, except for those expressly exempted by laws and regulations, RMB shall
not be convertible into foreign currencies which can be remitted to regions outside China unless
prior approval from the SAFE or its provincial counterparts is obtained.
According to the Circular of SAFE on Relevant Issues Concerning the Foreign Exchange
Administration of Overseas Listing (Hui Fa [2014] No. 54) (ྤ̮ɪ̹̮ි
(ි೯[2014]54 ໮)) issued on December 26, 2014, a joint stock company
registered within the territory of the PRC (the “ domestic company ”), which is permitted by CSRC
to issue its shares overseas and have them listed and traded on overseas stock exchanges, shall,
within 15 working days after the completion of the offering of shares for its overseas listing,
register overseas listing with the Foreign Exchange Bureau at the place of its incorporation. The
domestic company shall open a “special foreign exchange account of the domestic company for
overseas listing” with a domestic bank by producing its overseas listing registration certificate.
The account so opened shall be used for handling the exchange and transfer of funds
corresponding to the relevant business. Funds raised from the overseas listing of the domestic
company may be repatriated to China or deposited overseas, provided that the use of such funds
shall comply with the documents or corporate bonds collection documents, shareholders’ circulars,
resolutions of the Board Meetings or the shareholders’ general meetings and other publicly
disclosed documents.
Meanwhile, after overseas listing, a domestic shareholder of the domestic company intending
to increase or reduce his holding of shares of the overseas listed company in accordance with
relevant provisions shall register his shareholding with the local Foreign Exchange Bureau at the
place where domestic shareholder resides within 20 working days before the increase and
reduction of shares. The domestic shareholder shall open a “special account of the domestic
shareholder for overseas shareholding” with a domestic bank by producing its overseas
shareholding registration certificate. The account so opened shall be used for handling the
exchange and transfer of funds corresponding to the relevant business. A domestic shareholder’s
capital income obtained due to reducing or transferring overseas holding of the domestic company
or the domestic company’s withdrawing from overseas securities markets etc. may be deposited
overseas or remitted to the special account of the domestic shareholder for overseas shareholding.
For funds repatriated to China, the domestic shareholder can go through the procedures of
domestic transfer or exchange settlement of such funds with a bank by producing its overseas
shareholding registration certificate.
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LA WS AND REGULATIONS RELATING TO LABOR PROTECTION, SOCIAL
INSURANCE AND HOUSING PROVIDENT FUND
Pursuant to the Labor Law of the People’s Republic of China ()
promulgated by the SCNPC on July 5, 1994, latest amended and effective on December 29, 2018,
the Labor Contract Law of the People’s Republic of China ()
promulgated by the SCNPC on June 29, 2007, amended on December 28, 2012 and effective on
July 1, 2013 and the Regulation on the Implementation of the Labor Contract Law of the People’s
Republic of China (ૢԷ ) promulgated by the State Council on
September 18, 2008 and effective on the same date, the employer and each employee shall execute
a written labor contract. The wages paid by the employer to each employee shall not be less than
the local minimum wage. The employer shall establish an occupational safety and health
mechanism, and strictly abide by national standards, and provide employees with relevant
education. Employees shall work in a safe and sanitary environment.
Pursuant to the Social Insurance Law of the People’s Republic of China (ٟ
), the Regulations on Work Injury Insurance (ᎈૢԷ), the Regulations on
Unemployment Insurance (ᎈૢԷ) and the Interim Regulations on the Collection of
Social Insurance Fees (ᎈ൬ᅄᖮᅲБૢԷ), and other laws, regulations and rules, an
employer shall pay several social insurance premiums on behalf of its employees (including basic
pension insurance, unemployment insurance, basic medical insurance, work-related injury
insurance and maternity insurance). The relevant fees shall be paid to the local administrative
department. Where an employer fails to pay social insurance premiums in full and on time, the
social insurance premium collection agency shall order the payment of such premiums by a
specified date or make them up to the full amount, and shall impose a late payment of 0.05% of
the unpaid premium on a daily basis from the date of the default payment of such premiums;
where such payment is not made after the expiry of that period of time, the relevant administrative
authorities shall impose a fine of at least one and not exceeding triple the amount of the unpaid
premium. Pursuant to the Regulations on the Administration of Housing Provident Fund (ʮ
၍ଣૢԷ), which was promulgated by the State Council on April 3, 1999 and amended on
March 24, 2002, and became effective on March 24, 2019, the housing provident fund contributed
by an employee and his/her employer for the employee shall be owned by the employee. An
employer should undertake registration of payment and deposit of the housing provident fund in
the Housing Provident Fund Management Center and open a housing provident fund account for
each employee in a commissioned bank after verification by the Housing Provident Fund
Management Center. Where an employer fails to register the housing fund contributions or fails to
go through the procedures of setting up housing fund accounts for its own employees, it shall be
ordered by the Housing Provident Fund Management Center to do so within a certain period of
time; where it fails to do so, it shall be subject to a fine of not less than RMB10,000 and not more
than RMB50,000. Where an employer fails to pay or underpays the housing provident fund, the
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Housing Provident Fund Management Center shall order the employer to pay the fund within a
certain period of time; where the employer fails to do so, the Housing Provident Fund
Management Center may apply to the people’s court for compulsory execution.
LA WS AND REGULATIONS RELATING TO TAXATION
Enterprise Income Tax Law
Under the Enterprise Income Tax Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷
) (the “ EIT Law ”), which became effective on January 1, 2008 and was latest
amended and implemented on December 29, 2018, a uniform enterprise income tax rate of 25%
applies to the income of all resident enterprises and non-resident enterprises that have set up
institutions or establishments in the PRC that originates from China or the income derived from
the regions outside China, but which have substantial connection with the said institutions or
establishments. Enterprises that qualify as “High and New Technology Enterprises” which are
strongly supported by China, are entitled to a preferential tax rate of 15%. Pursuant to the
Measures for the Administration of Accreditation of High and New Technology Enterprises ( ৷อ
) (the “ Accreditation Measures ”) amended in January 2016, the Ministry
of Science and Technology of the People’s Republic of China, the Ministry of Finance and the
provincial counterparts of the State Taxation Administration determine whether an enterprise
qualifies as a “High and New Technology enterprise” under the EIT Law. In making such
determination, these governmental authorities take into account, among other things, the ownership
of the core technology, whether the technology that plays a central role in supporting the
enterprise’s major products or services falls within the scope under the High and New Technology
Fields with Strong Support by China (৷อҦஔჯਹ), the ratio of research and
development personnel to the total number of employees, the ratio of research and development
expenses to the sales revenue in the same period, and the ratio of the revenue from products or
services produced by high and new technology to the total revenue in the same period. The
certificate of a “High and New Technology enterprise” is valid for a term of three years.
Value-added Tax
Pursuant to the Interim Regulations of the People’s Republic of China on Value-added Tax
(೼ᅲБૢԷ), which was latest amended and became effective on
November 19, 2017, and the Rules for the Implementation of the Interim Regulations of the
People’s Republic of China on Value-added Tax ( ),
which was promulgated on December 25, 1993 and amended on October 28, 2011, and became
effective on November 1, 2011, entities or individuals engaging in sale of goods, provision of
processing services, repairs and replacement services or importation of goods within the PRC shall
REGULATORY OVERVIEW
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pay value-added tax (the “ VAT”). The tax payable shall be the balance of output tax for the period
after deducting the input tax for the period. In general, the V AT rate is 17% and in some cases, it
is 11% or 6%, as the case may be.
Pursuant to the Circular of the Ministry of Finance and the State Taxation Administration on
the Adjustment of Value-added Tax Rates ( ),
which entered into force on May 1, 2018, for general V AT payers’ sales activities or import of
goods that are subject to V AT at an existing applicable rate of 17% or 11%, the rate is adjusted to
16% or 10%, respectively.
According to Announcement of the Ministry of Finance, the State Taxation Administration
and the General Administration of Customs on Policies for Deepening the V AT Reform (݁
ʮѓ ) (Announcement of the Ministry
of Finance, the State Taxation Administration and the General Administration of Customs, No. 39
of 2019), which became effective on April 1, 2019, for general V AT payers’ sales activities or
import of goods that are subject to V AT at an existing applicable rate of 16% or 10%, the
applicable V AT rate is adjusted to 13% or 9%, respectively.
LA WS AND REGULATIONS RELATING TO U.S. EXPORT AND IMPORT CONTROLS
In recent years, the United States has increased export controls restrictions on China through
the Export Administration Regulations (the “ EAR”), administered by the Bureau of Industry and
Security of the U.S. Department of Commerce, which includes a list of foreign persons on which
certain trade restrictions are imposed, including businesses, research institutions, government and
private organizations, individuals and other types of legal persons (the “ Entity List ”). Where a
foreign person is included on the Entity List, the export, re-export and/or transfer (in-country) of
items which are subject to the EAR generally is prohibited unless the specified license
requirements are met.
With respect to U.S. export controls, in October 2022, BIS issued an interim final rule (the
“BIS October 2022 IFR ”) aimed at restricting China’s ability to obtain advanced computing
integrated circuits, develop and maintain supercomputers, and manufacture advanced
semiconductors. In October 2023, BIS issued another interim final rule that updated and expanded
U.S. export controls imposed by the BIS October 2022 IFR (together with the BIS’s April 2024
interim final rule making technical corrections and clarifications to the BIS October 2023 IFR, the
“BIS October 2023 IFR ”). In January 2025, BIS issued another interim final rule revising the
EAR controls on advanced computing integrated circuits and adding a new control on artificial
intelligence (AI) model weights for certain advanced closed-weight dual-use AI models (the “ AI
Diffusion Rule ” and collectively with the BIS October 2022 IFR and BIS October 2023 IFR, the
“Advanced Computing IFRs ”). Among other measures, the BIS 2022/23 IFRs add to the
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Commerce Control List (which is a list of commodities, software, and technologies that are subject
to the EAR’s more restrictive controls) certain advanced and high-performance computing
integrated circuits and computer commodities that contain these integrated circuits, and impose
new or expanded license requirements for items subject to the EAR destined for an end-use in the
development or production of supercomputers, certain types of advanced node integrated circuits
and advanced, or semiconductor manufacturing equipment in certain jurisdictions, including China.
In August 2023, President Joe Biden signed an Executive Order on Addressing United States
Investments in Certain National Security Technologies and Products in Countries of Concern (the
“Executive Order ”). In October 2024, the U.S. Department of Treasury issued a final rule to
implement the Executive Order (the “ Final Rule ”). The final rule provides the operative
regulations for certain U.S. investments into China (including Hong Kong and Macau) in entities
engaged in activities involving sensitive technologies critical to national security in three sectors,
namely, semiconductors and microelectronics, quantum information technologies, and artificial
intelligence. The program, after its effectiveness on January 2, 2025, prohibits U.S. persons from
undertaking certain transactions and require notification by U.S. persons on certain investments.
The Final Rule excludes certain “excepted transactions,” such as passive investments into publicly
traded securities.
The U.S. government has recently increased regulatory scrutiny on Chinese technology in the
U.S. automotive sector, citing national security and economic concerns. For example, on February
29, 2024, the U.S. Department of Commerce commenced a study on the risks that “connected
vehicles” could pose to the United States and on January 14, 2025, BIS announced a final rule
which, effective March 17, 2025, among other things, prohibits (1) vehicle connectivity system
(“VCS”) hardware importers from knowingly importing into the United States VCS hardware that
is designed, developed, manufactured, or supplied by persons owned by, controlled by, or subject
to the jurisdiction or direction of the PRC or Russia; (2) PRC or Russian connected vehicle
manufacturers from knowingly selling in the United States completed connected vehicles that
incorporate VCS hardware or certain software that directly enables VCS or Automated Driving
Systems (“ ADS”) (collectively, “ covered software ”), regardless of whether such VCS hardware or
covered software is from China or Russia; and (3) connected vehicle manufacturers from
knowingly importing into the United States or selling within the United States completed
connected vehicles that incorporated covered software from China or Russia (the “ Connected
Vehicle Rule ”). Under the Connected Vehicle Rule, vehicles with a gross vehicle weight rating of
more than 4,536 kilograms (10,000 pounds) are excluded from the definition of a ‘connected
vehicle’. As most commercial vehicles exceed this weight threshold, the rule generally does not
cover commercial vehicles. The software-related prohibitions will take effect for vehicles that are
model year 2027. The hardware-related prohibitions will take effect for vehicle model year 2030,
or January 1, 2029, for units without a model year. Prohibitions on the sale of connected vehicles
by manufacturers with a sufficient nexus to China or Russia, even if manufactured in the United
States, will take effect for vehicle model year 2027.
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OVERVIEW
Our history can be traced back to 2017, when our Company was co-founded by Prof. Li and
Dr. Ma under its former name, Changsha Intelligent Driving Research Institute Company Limited
(ʮ̡ ). Under the combined prowess of Prof. Li, a serial academic
entrepreneur with over 30 years of experience in incubating talents and next-generation companies
(particularly in AI, robotics and automation), and Dr. Ma, a Silicon Valley veteran with over 30
years of expertise in robotics, signal processing and automotive industries, our Group was formed
with the vision to developing practical intelligent driving products for commercial vehicles. For
details of our co-founders, see “Directors and Senior Management” in this prospectus.
Since the inception of our Group, we have made long strides and achieved many
accomplishments within the autonomous driving industry. According to CIC, we are one of the
earliest companies in China (including Hong Kong, Macau and Taiwan) to commercialize
autonomous driving technology for commercial vehicles.
OUR KEY MILESTONES
The following is a summary of our Group’s key business development milestones:
Y ear Month Milestone
2018 March We completed our first round Series A Pre-IPO
Investment, where we received investments from our
Pathfinder SIIs.
June We assisted in developing the management and
operations plan for the Hunan (Changsha) National V2X
Pilot Area.
August Our intelligent heavy trucks under development achieved
a road speed of 100 km/h under autonomous driving in
closed roads and high-speed environments.
2019 September We entered into cooperation agreements with Dongfeng
Liuzhou Motor.
We provided a complete set of vehicle-road coordination
systems with holographic perception capabilities for
Changsha’s “Double 100” 100 kilometres of smart
highways and urban open roads.
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Y ear Month Milestone
2020 June We completed the deployment of China’s first and
largest-scale “Active Bus Priority” system.
September We released a mass production solution for a intelligent
driving commercial vehicles, achieving “high computing
power, high safety, high reliability and unified
standards”.
2021 January We established a national-level V2X pilot zones for
Liangjiang New Area, Chongqing through the creation of
vehicle-road coordination systems for six different
application scenarios.
April We launched a new generation of pure electric unmanned
mining trucks and unmanned mining solutions through
our autonomous driving software systems.
June We jointly launched two driverless commercial vehicles
together with DFLZ.
2022 November The H5 Chenglong intelligent vehicle developed with
DFLZ officially entered the stage of regular operations
in urban areas.
December We delivered China (including Hong Kong, Macau and
Taiwan)’s first autonomous electric mining project with
full mining area coverage in Jiangsu.
2023 May We launched the first batch of unmanned electric mining
trucks with a load capacity of 70 tons each.
June We launched the commercial operation of autonomous
driving within a logistics park (without safety
personnel).
2024 May Our fleet comprised 56 autonomous mining trucks and
nearly 500 manned mining trucks operating in mixed
traffic, entering into regular production operations
(without safety personnel), forming the world’s largest
mixed-operation mining fleet.
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Y ear Month Milestone
August We entered into an agreement for a zero-waste initiative
in Ha’il, Saudi Arabia utilizing our V2X products and
solutions to upgrade the city’s entire fleet of heavy-duty
trucks for intelligent operation and management of the
full lifecycle of waste processing.
September We passed the stringent SIL4 safety certifications for our
TAPS system, as one of the few companies in China to
obtain such certification.
2025 August We were listed as one of the “Fortune China Tech 50”,
being the only company in the field of intelligent driving
for commercial vehicles.
OUR MAJOR SUBSIDIARIES
As of the Latest Practicable Date, the following entities were our major subsidiaries which
had made a material contribution to our results of operation during the Track Record Period:
Name of subsidiary Place of incorporation Date of incorporation Shareholding Principal business activities
NovoDriv Chongqing PRC May 29, 2020 100% Research and development,
sales and operation of
products and services for
autonomous driving and
vehicle-road collaboration
Tianjin CiDi PRC December 14, 2020 100% Sales and operation of products
and services for vehicle-road
collaboration
Changsha CiDi
Construction
PRC July 29, 2019 67%
(1) Management of the operation of
autonomous driving industrial
area
CiDi Chengdu PRC April 1, 2022 100% Research and development,
sales and operation of
autonomous driving and
vehicle-road collaboration
products and services
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Note:
(1) The remaining 33% equity interest in Changsha CiDi Construction is held by Changsha Zhigu High-tech Industry
Investment Co., Ltd. (ʮ̡ )( “ Changsha Zhigu ”), an Independent Third Party.
Changsha Zhigu does not hold any voting rights in Changsha CiDi Construction and, upon completion of the
Listing, Changsha Zhigu’s equity interest in Changsha CiDi Construction will be transferred to the Company and
Changsha CiDi Construction will become a wholly-owned subsidiary of the Company.
MAJOR ACQUISITIONS, DISPOSALS AND MERGERS
We have not conducted any acquisitions, disposals or mergers since our inception that we
consider to be material to us.
MAJOR SHAREHOLDING CHANGES IN OUR COMPANY
Establishment of our Company
Our Company was established under its former name, Changsha Intelligent Driving Institute
Company Limited (ʮ̡ ), as a limited liability company under the laws
of the PRC on October 16, 2017 with an initial registered capital of RMB6,511,000. Upon
establishment, NovoDriv HK and Changsha Gangwan held RMB4,557,700 and RMB1,953,300 of
the registered capital of the Company, respectively.
NovoDriv HK is a limited partnership established as a shareholding platform for the Group,
and is ultimately controlled by Prof. Li. The sole general partner of NovoDriv HK since the
Group’s establishment and up to the Latest Practicable Date has been NovoDriv Limited, which in
turn is wholly-owned by Prof. Li. From the date of the Group’s establishment until January 2018,
the limited partner of NovoDriv HK was Dr. Ma as to 100%. Since January 2018 and up to the
Latest Practicable Date, NovoDriv HK was held as to 68.67% by NovoDriv Limited, 25.66% by
Dr. Ma, 2.63% by Yang Xi, 1.62% by Hu Jishan (ᘱഛ), the father of Hu Albert Sibo, our
executive Director and chief executive officer, and 1.42% by CWB Startup HK as limited partners.
Changsha Gangwan was established as the Company’s share incentive platform and is ultimately
controlled by Prof. Li.
Conversion into a Joint Stock Company with Limited Liability
Pursuant to the shareholders’ resolutions of our Company dated May 28, 2024, our Company
was converted from a limited liability company into a joint stock company on July 2, 2024. Upon
completion of the conversion, the registered capital of our Company was RMB38,381,330 divided
into 38,381,330 Shares with a nominal value of RMB1.00 each, which were subscribed by all the
then Shareholders in proportion to their respective interests in our Company before the conversion.
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PRE-IPO INVESTMENTS
Series A Financing
On March 20, 2018, we completed our Series A Financing, resulting in the increase of our
registered capital from RMB6,511,000 to RMB10,000,000 at an aggregate consideration of
USD30,000,000. Details of our Series A Financing is set out below:
Subscribers
Registered capital
subscribed for
Shareholding
percentage
subscribed for at the
time under the
Series A Financing Consideration
Beijing HongShan ............. RMB1,628,200 16.28% USD14,000,000
Guangkong Zhongying .......... RMB348,900 3.49% USD3,000,000
Guangkong Capital (1) ........... RMB348,900 3.49% USD3,000,000
Lianke Investment (2) ............ RMB232,600 2.33% USD2,000,000
Xinghao VC .................. RMB232,600 2.33% USD2,000,000
Baidu Venture ................. RMB348,900 3.49% USD3,000,000
CWB Startup HK .............. RMB116,300 1.16% USD1,000,000
Lens Technology ............... RMB116,300 1.16% USD1,000,000
Hangsheng Investment (3) ........ RMB116,300 1.16% USD1,000,000
Total ........................ RMB3,489,000 34.89% USD30,000,000
Notes:
(1) On December 24, 2019, Guangkong Zhongying No. 3 Industrial Investment Center (Limited Partnership) (ޮ
ୋɧ໮ପุҳ༟ʕː (Υྫ)) (“ Guangkong Capital ”) completed the transfer of its entire equity interest in the
Company to Beta Garden at a consideration of USD3,000,000.
(2) On October 12, 2018, Tibet Dazi Lianke Investment Co., Ltd. (ʮ̡ )( “ Lianke
Investment ”) completed the transfer of its entire equity interest in the Company to Lianpan VC at a consideration
of RMB12,614,400.
(3) On February 2, 2021, Shenzhen Hangsheng Investment Co., Ltd. (ப΂ʮ̡ )( “ Hangsheng
Investment ”) completed the transfer of its entire equity interest in the Company to Ningbo Jiusheng at a
consideration of RMB12,000,000.
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Capital Increase in November 2018
On November 28, 2018, our registered capital was increased from RMB10,000,000 to
RMB25,000,000, representing an additional RMB15,000,000 in the registered capital of our
Company converted from our Company’s capital reserves. Each of our then existing Shareholders
received a proportion of the increased registered capital on a pro-rata basis based on their
shareholding in our Company, as detailed below.
Shareholders
Registered capital
received
Registered capital
held upon
completion of capital
increase
Shareholding
percentage in the
Company at the time
upon completion of
capital increase
NovoDriv HK ................. RMB6,836,550 RMB11,394,250 45.58%
Changsha Gangwan ............. RMB2,929,950 RMB4,883,250 19.53%
Beijing HongShan ............. RMB2,442,300 RMB4,070,500 16.28%
Guangkong Zhongying .......... RMB523,350 RMB872,250 3.49%
Guangkong Capital ............. RMB523,350 RMB872,250 3.49%
Lianpan VC ................... RMB348,900 RMB581,500 2.33%
Xinghao VC .................. RMB348,900 RMB581,500 2.33%
Baidu Venture ................. RMB523,350 RMB872,250 3.49%
CWB Startup HK .............. RMB174,450 RMB290,750 1.16%
Lens Technology ............... RMB174,450 RMB290,750 1.16%
Hangsheng Investment ........... RMB174,450 RMB290,750 1.16%
Total ........................ RMB15,000,000 RMB25,000,000 100.00%
Series A-1 Financing
On December 9, 2019, we completed our Series A-1 Financing, resulting in the increase of
our registered capital from RMB25,000,000 to RMB26,595,745, at an aggregate consideration of
USD12,000,000. Details of our Series A-1 Financing is set out below:
Subscribers
Registered capital
subscribed for
Shareholding
percentage
subscribed for at the
time under the
Series A-1 Financing Consideration
Changsha Hesheng ............. RMB664,894 2.50% USD5,000,000
Tibet Fangchuang .............. RMB132,979 0.50% USD1,000,000
Xiangjiang Investment ........... RMB398,936 1.50% USD3,000,000
Changsha Shengyu ............. RMB132,979 0.50% USD1,000,000
Xinjun Electronics .............. RMB199,468 0.75% USD1,500,000
Lakeside VC .................. RMB66,489 0.25% USD500,000
Total ........................ RMB1,595,745 6.00% USD12,000,000
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Series A-2 Financing
Between July and September 2020, we completed our Series A-2 Financing, resulting in the
increase of our registered capital from RMB26,595,745 to RMB28,228,054, at an aggregate
consideration of approximately RMB100,139,000. Details of the Series A-2 Financing is set out
below:
Subscribers
Registered capital
subscribed for
Shareholding
percentage
subscribed for at the
time under the
Series A-2 Financing Consideration
Stage 1 (completed on July 8,
2020)
Liangjiang Chengwei ............ RMB578,169 2.05% RMB35,469,500
Nanjing Bestway ............... RMB81,502 0.29% RMB5,000,000
Tibet Fangchuang (1)............. RMB32,601 0.12% RMB2,000,000
Stage 2 (completed on July 31,
2020)
Liangjiang Chengwei ............ RMB578,168 2.05% RMB35,469,500
NovoDriv HK ................. RMB48,901 0.17% RMB3,000,000
Stage 3 (completed on September
21, 2020)
Xiangsanze Capital ............. RMB195,605 0.69% RMB12,000,000
Sanze Investment .............. RMB117,363 0.42% RMB7,200,000
Total ........................ RMB1,632,309 5.78% RMB100,139,000
Note:
(1) On February 1, 2024, Tibet Fangchuang completed the transfer of RMB38,279 in the registered capital of the
Company to Ceyuan Guangyi Digital Fund at a consideration of RMB6,000,000.
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Series A-3 Financing
On February 2, 2021, we completed our Series A-3 Financing, resulting in the increase of our
registered capital from RMB28,228,054 to RMB32,391,323, at an aggregate consideration of
approximately RMB281,700,000. Details of our Series A-3 Financing are as follows:
Subscribers
Registered capital
subscribed for
Shareholding
percentage
subscribed for at the
time under the
Series A-3 Financing Consideration
Xiangjiang Intelligent Innovation (1) RMB1,330,118 4.11% RMB90,000,000
Xinding No. 1 ................. RMB1,041,926 3.22% RMB70,500,000
Qinghao Yuanmao .............. RMB295,582 0.91% RMB20,000,000
Xinding No. 6 ................. RMB786,247 2.43% RMB53,200,000
Hunan Yunfa (2) ................ RMB147,791 0.46% RMB10,000,000
Ningbo Jiusheng ............... RMB561,605 1.73% RMB38,000,000
Total ........................ RMB4,163,269 12.85% RMB281,700,000
Notes:
(1) On November 2, 2021, Xiangjiang Intelligent Innovation completed the transfer of RMB665,059 in the registered
capital in the Company to Qingdao Zhenghan No. 2 at a consideration of RMB47,958,900.
(2) On June 1, 2021, Hunan Yunfa Industry Fund Partnership (Limited Partnership) (ΥྫΆุ (ࠢ
Υྫ)) (“ Hunan Yunfa ”) completed the transfer of its entire interest in the registered capital of the Company to
Yunfa Ruichi at a consideration of RMB10,000,000.
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Series B Financing
On June 1, 2021, we completed our Series B Financing, resulting in the increase of our
registered capital from RMB32,391,323 to RMB35,469,571, at an aggregate consideration of
approximately RMB280,347,776. Details of our Series B Financing are as follows:
Subscribers
Registered capital
subscribed for
Shareholding
percentage
subscribed for at the
time under the
Series B Financing Consideration
Xinding No. 20 ................ RMB1,010,170 2.85% RMB92,000,000
Xinding No. 19 ................ RMB384,304 1.08% RMB35,000,000
Xinding No. 36 ................ RMB340,383 0.96% RMB31,000,000
Zibo Xuanshi ................. RMB109,801 0.31% RMB10,000,000
Tianjin Shengde ............... RMB109,801 0.31% RMB10,000,000
Baodechang ................... RMB109,801 0.31% RMB10,000,000
Qiandao Ronghui .............. RMB329,403 0.93% RMB30,000,000
Chuanghe Huimao .............. RMB219,602 0.62% RMB20,000,000
Baidu Venture ................. RMB44,352 0.13% RMB4,039,276
Xingxiang Fangzheng ........... RMB219,602 0.62% RMB20,000,000
Xindiyuan .................... RMB109,801 0.31% RMB10,000,000
Qingdao Zhenghan No. 1 ........ RMB91,228 0.26% RMB8,308,500
Total ........................ RMB3,078,248 8.68% RMB280,347,776
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Series B+ Financing
Between October and November 2021, we completed our Series B+ Financing, resulting in
the increase of our registered capital from RMB35,469,571 to RMB37,028,163, at an aggregate
consideration of approximately RMB263,650,000. Details of our Series B+ Financing are as
follows:
Subscribers
Registered capital
subscribed for
Shareholding
percentage
subscribed for at the
time under the
Series B+ Financing Consideration
Stage 1 (completed on October 9,
2021)
Qinghao Deruo ................ RMB598,845 1.62% RMB101,300,000
Jingkai Qitao .................. RMB112,320 0.30% RMB19,000,000
Zhibo Deruo .................. RMB75,668 0.20% RMB12,800,000
Juncheng Hongxin .............. RMB236,464 0.64% RMB40,000,000
Xingfan VC ................... RMB177,348 0.48% RMB30,000,000
Xinding No. 18 ................ RMB147,790 0.40% RMB25,000,000
Xindiyuan (1) .................. RMB29,558 0.08% RMB5,000,000
Zhitu No. 1 ................... RMB129,464 0.35% RMB21,900,000
Baodechang ................... RMB10,936 0.03% RMB1,850,000
Stage 2 (completed on November
2, 2021)
Zibo Hongshi ................. RMB40,199 0.11% RMB6,800,000
Total ........................ RMB1,558,592 4.21% RMB263,650,000
Notes:
(1) On July 5, 2024, Xindiyuan completed the transfer of its entire interest held in the registered capital of Company to
Chen Junying (ߵZhou Hanzhong (׀Ren Xiaopei ( ΂ʃ੃), Yang Xiaoni ( ජʃ֋) and Zhou
Pingyong (ۇas to RMB58,195, RMB30,656, RMB26,352, RMB13,176 and RMB10,980, respectively, for an
aggregate consideration of RMB15,000,000.
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Series C Financing
Between April and June 2022, we completed our Series C Financing, resulting in the increase
in our registered capital from RMB37,028,163 to RMB38,279,252, at an aggregate consideration of
approximately RMB270,300,000. Details of the Series C Financing are as follows:
Subscribers
Registered capital
subscribed for
Shareholding
percentage
subscribed for at the
time under the
Series C Financing Consideration
Stage 1 (completed on April 14,
2022)
Ruichuang Zhitu ............... RMB927,093 2.42% RMB200,300,000
Chengdu Technology VC ......... RMB231,426 0.60% RMB50,000,000
Stage 2 (completed on June 28,
2022)
Jiangxia Xintuo ................ RMB92,570 0.24% RMB20,000,000
Total ........................ RMB1,251,089 3.27% RMB270,300,000
Series C+ Financing
On February 1, 2024, we completed our Series C+ Financing, pursuant to which Ceyuan
Guangyi Digital Fund subscribed for RMB102,078 in the registered capital of our Company at a
consideration of RMB24,000,000, representing approximately 0.27% in the total registered capital
of the Company, resulting in the increase of our registered capital from RMB38,279,252 to
RMB38,381,330.
For details of the shareholding of our Company upon completion of the Pre-IPO Investments,
please refer to “— Capitalization of our Company” below.
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The following table summarizes the key terms of the Pre-IPO Investments to the Company made by the Pre-IPO Investors:
Series A Series A-1 Series A-2 Series A-3 Series B Series B+ Series C Series C+
Date of relevant resolutions of the
Company .............
March 16, 2018 December 5, 2019 July 8, 2020, July
30, 2020, and
September 16,
2020
February 1, 2021 May 31, 2021 September 30, 2021,
and November 1,
2021
January 28, 2022 and
June 28, 2022
January 31, 2024
Amount of consideration paid to the
Company .............
USD30,000,000 USD12,000,000 RMB100,139,000 RMB281,700,000 RMB280,347,776 RMB263,650,000 RMB270,300,000 RMB24,000,000
Date of last settlement of consideration . March 20, 2018 December 9, 2019 September 21, 2020 February 2, 2021 June 1, 2021 November 2, 2021 June 28, 2022 February 1, 2024
Cost per Share ............ USD3.44
(4) USD7.52 RMB61.35 RMB67.66 RMB91.07 RMB169.16 RMB216.05 RMB235.11
Implied pre-money valuations (1) .... USD55,984,523 USD188,000,000 RMB1,631,597,000 RMB1,910,000,000 RMB2,950,000,000 RMB6,000,000,000 RMB8,000,000,000 RMB9,000,000,000
Implied post-money valuations (2) ... USD85,984,523 US$200,000,000 RMB1,731,736,000 RMB2,191,700,000 RMB3,230,347,776 RMB6,263,650,000 RMB8,270,300,000 RMB9,024,000,000
Discount to the Offer Price (3) ..... 91.47% discount to
the Offer Price
81.36% discount to
the Offer Price
78.58% discount to
the Offer Price
76.38% discount to
the Offer Price
68.20% discount to
the Offer Price
40.94% discount to
the Offer Price
24.57% discount to
the Offer Price
17.91% discount to
the Offer Price
Lock-up period ............ Pursuant to the applicable PRC laws, each of the existing Shareholders of the Company (including the Pre-IPO Investors) are not permitted to dispose o f any of the Shares held by them
within the 12 months immediately following the Listing Date. In addition, our Pathfinder SIIs will also be subject to disposal restrictions pursuant to Rule 18C.14 of the Listing Rules. See
“— Lock-up Periods” in this section for further details.
Basis of determination of the valuation
and consideration ..........
The consideration for the Pre-IPO Investments was determined based on arm’s length negotiations between the Company and the Pre-IPO Investors after taking into consideration various
factors, including but not limited to (i) status of milestones and prospects of commercialization of our specialist technology products; (ii) our ex pansion capacity and R&D management
systems; (iii) strategic layout, execution efficiency and other factors of our Company; and (iv) the timing of the investments, market value and busi ness prospects.
Use of proceeds from the Pre-IPO
Investments ............
As of the Latest Practicable Date, approximately 90% of the funds raised from the Pre-IPO Investments had been utilized. All of such proceeds were util ized for the research and
development, capital expenditures and general working capital needs of our Group in accordance with the annual consolidated budget of the Company ap proved by the Pre-IPO Investors.
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Series A Series A-1 Series A-2 Series A-3 Series B Series B+ Series C Series C+
Strategic benefits the Pre-IPO
Investments brought to our Company .
At the time of the Pre-IPO Investments, our Directors were of the view that our Company would benefit from the additional capital provided by the Pre-IP O Investors’ investments in our
Company and their knowledge and experience.
Reasons for fluctuations in valuation as
compared to the immediate previous
round of Pre-IPO investment ....
We continued our research and development of our Specialist Technology Products, and achieved various business milestones in 2018 and 2019, includi ng entering
into cooperation agreements with Dongfeng Liuzhou Motor.
We achieved mass production and commercialization of our V2X products and solutions in 2020.
We launched our closed-environment autonomous logistics truck solutions in February 2021.
We established the national-level V2X pilot zones for Liangjiang New Area, and released a
new generation of pure electric unmanned mining trucks and unmanned mining solutions
in 2021.
We released two driverless autonomous driving commercial vehicles
with Dongfeng Liuzhou Motor in 2021.
We continued to commercialize and expand
the scale of our operations.
We achieved mass
production of
TAPS and
launched the first
batch of unmanned
electric mining
vehicles with a
load capacity of 70
tons each.
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Series A Series A-1 Series A-2 Series A-3 Series B Series B+ Series C Series C+
Reasons for fluctuations in valuation as
compared with the Global Offering
and the valuation in Series C+, being
the latest round of Pre-IPO
investment .............
In 2024, we continued to achieve further mass commercialization of our products.
Notes:
(1) The implied pre-money valuation is calculated based on (i) the cost per Share paid to the Company for the corresponding round of Pre-IPO Investment and (ii) the
total registered share capital of the Company immediately prior to the corresponding round of Pre-IPO Investment.
(2) The implied post-money valuation is the sum of (i) the pre-money valuation for the corresponding round of Pre-IPO Investment and (ii) the total fun ds received by
the Company from the corresponding round of Pre-IPO Investment.
(3) Calculated based on the currency translation of HK$1.00 to RMB0.9136 and HK$7.7695 to US$1.00 (as applicable) and on the Offer Price of HK$263.00 p er Share.
(4) Taking into account (i) the initial subscription amounts under the Series A Financing and (ii) the subsequent capital increase of the Company on a p ro-rata basis to its
then existing Shareholders in November 2018.
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PRC Legal Advisor’s confirmation
Our PRC Legal Adviser has confirmed that we have legally and properly completed, settled,
and obtained the requisite legal approvals and completed requisite governmental registrations with
relevant governmental authorities in the PRC with respect to all the aforesaid Pre-IPO Investments,
capital increases and equity transfers in all material respects.
Special rights of the Pre-IPO Investors
Pursuant to the relevant agreements entered in connection with the Pre-IPO Investments
between the Company and the Pre-IPO Investors (the “ Shareholders’ Agreements ”), the Pre-IPO
Investors had been granted certain special rights in relation to the Company.
The divestment rights granted to the Pre-IPO Investors under the Shareholders’ Agreements
have been terminated prior to the first submission of the listing application to the Stock Exchange
for the purpose of the Global Offering, and will only be exercisable if (i) the Company withdraws
its listing application from the CSRC, SFC or the Stock Exchange; (ii) if the CSRC, SFC or the
Stock Exchange does not accept, rejects or terminates the listing application of the Company; (iii)
the Listing does not take place prior to February 5, 2026; (iv) the Listing does not take place
within 18 months of the first submission of the listing application to the Stock Exchange; or (v)
the CSRC, SFC or Stock Exchange does not approve the Company’s listing application. All other
special rights under the Pre-IPO Investments shall cease to be effective and be discontinued upon
the Listing in accordance with Chapter 4.2 of the Guide, including, among others, anti-dilution
rights, director appointment rights, information rights, pre-emptive rights, tag-along rights and
divestment rights.
Compliance with the Guide for New Listing Applicants
On the basis that (i) the consideration for the last Pre-IPO Investment was irrevocably settled
more than 28 clear days before the date of our first submission of the listing application to the
Stock Exchange for the purpose of the Global Offering, and (ii) the special rights granted to the
Pre-IPO Investors will be suspended upon filing of a listing application and/or shall cease to be
effective and be discontinued upon Listing, the Joint Sponsors confirm that the Pre-IPO
Investments are in compliance with Chapter 4.2 under the Guide.
Information relating to our key Pre-IPO Investors
Set out below is a description of our Sophisticated Independent Investors (as defined in
Chapter 2.5 of the Guide for New Listing Applicants issued by the Stock Exchange). We have four
Sophisticated Independent Shareholders, three of which respectively holds more than 3% of the
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total issued shares of the Company as of the Latest Practicable Date and are our Pathfinder SIIs.
Save for being a shareholder of our Company and as disclosed otherwise, each of our
Sophisticated Independent Investors is independent from each other and is not connected with any
Director, chief executive or substantial shareholder of our Company, its subsidiaries or any of their
respective associates (within the meaning of the Listing Rules). To the best knowledge of our
Directors, save for their respective shareholding interests in the Company of the Company, each of
our Pre-IPO Investors and their respective ultimate beneficial owners is an Independent Third
Party aside from CWB Startup HK and Changsha Shengyu.
Our Pathfinder Sophisticated Independent Investors (“Pathfinder SIIs”)
(a) HongShan SII (being Beijing HongShan)
Beijing HongShan Mingde Equity Investment Centre (Limited Partnership) (ٰ
ᛆҳ༟ʕː (Υྫ)) (“ Beijing HongShan ”) is a limited liability partnership established under
the laws of the PRC. The general partner of Beijing HongShan is Beijing HongShan Kunde
Investment Management Center (Limited Partnership) (ӄտᅃҳ༟၍ଣʕː (Υྫ))
(“HongShan Kunde ”), holding approximately 0.0002% partnership interest in Beijing HongShan,
and has full discretion to exercise the investment decisions in respect of the assets managed under
Beijing HongShan. HongShan Kunde is held as to 58.8% and 41.2% by Xiamen HongShan Xingrui
Innovation Technology Co., Ltd. (ʮ̡ )( “ Xiamen HongShan ”) and
Shanghai Huanyuan Investment Management Co., Ltd. (ʮ̡ )( “ Shanghai
Huanyuan ”), respectively, both entities being ultimately controlled by Mr. Kui Zhou ( մඃ), a
partner of HongShan Capital Group (“ HongShan ”). The general partner of HongShan Kunde is
Shanghai Huanyuan. Beijing HongShan has two limited partners, Beijing HongShan Shengde
Equity Investment Center (Limited Partnership) (ᛆҳ༟ʕː (Υྫ))
(“HongShan Shengde ”) and Beijing HongShan Kangde Equity Investment Center (Limited
Partnership) (ᛆҳ༟ʕː (Υྫ)( “ HongShan Kangde ”) (with no limited
partner holding 30% or more interests in Hongshan Kangde), holding approximately 60.74% and
39.26% of partnership interest in Beijing HongShan, respectively. The general partner of
HongShan Shengde and HongShan Kangde is Ningbo Meishan Bonded Port Area HongShan Huide
Investment Management Partnership (Limited Partnership) (ӄ⸭ᅃҳ༟၍ଣ
Υྫ(Υྫ)) (“ Meishan HongShan ”), its general partner being Shanghai Huanyuan. Meishan
HongShan is ultimately controlled by Mr. Kui Zhou. The limited partnership interest of HongShan
Shengde is held as to 40.89% and 38.30% by Beijing HongShan Yade Equity Investment Centre
(Limited Partnership) (ᛆҳ༟ʕː (Υྫ)) (“ HongShan Y ade ”) and
Hangzhou HongShan Peide Zhihui Equity Investment Centre (Limited Partnership) (ӄभᅃ
ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Hangzhou HongShan ”), respectively. The limited
partnership interest of HongShan Yade is held as to 36.95% by Wuhu Juncheng Investment Centre
(Limited Partnership) (ϓҳ༟ʕː (Υྫ)) (“ Wuhu Juncheng ”), with no other limited
partners holding 30% or more interests in HongShan Yade. The limited partnership interest of
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Hangzhou HongShan is held as to 92.37% by Beijing HongShan Haoxin Management Consulting
Center (Limited Partnership) (၍ଣፔ༔ʕː (Υྫ)) ( “HongShan Haoxin ”), the
limited partnership interest of which is held by Wuhu Juncheng. In addition to being the general
partner of HongShan Shengde and HongShan Kangde, Meishan HongShan is also the general
partner of HongShan Yade, Hangzhou HongShan and HongShan Haoxin.
HongShan is a leading venture capital and private equity firm investing across technology,
healthcare and consumer sectors. In addition to our Company, investment funds affiliated with
HongShan have also invested in other specialist technology companies (including QuantumPharm
Inc. (2228.HK)) and listed autonomous driving and artificial intelligence companies (including
Horizon Robotics (9660.HK) and Beijing Fourth Paradigm Technology Co., Ltd. (6682.HK)).
As of December 31, 2017
(1), HongShan’s assets under management was over HK$15 billion
across different products and affiliate funds. As of June 30, 2025, HongShan’s assets under
management was approximately US$55 billion across different products and affiliate funds.
Beijing HongShan held approximately 10.61% and 10.63% of the total issued share capital of
the Company, as of the date of submission of the Company’s first Listing application and the
commencement date of the pre-application 12-month period, respectively
(2).
(b) Xinding Capital SIIs (being Xinding No. 1, Xinding No. 6, Xinding No. 18, Xinding No. 19,
Xinding No. 20 and Xinding No. 36)
Each of Suqian Xinding Kenge No. 1 Equity Investment Partnership (Limited Partnership)
(ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Xinding No. 1 ”), Qingdao Xinding Kenge
No. 6 Equity Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆ
ุ(Υྫ)) (“ Xinding No. 6 ”), Qingdao Xinding Kenge No. 18 Equity Investment Partnership
(Limited Partnership) (ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Xinding No. 18 ”),
Qingdao Xinding Kenge No. 19 Equity Investment Partnership (Limited Partnership) (อཻਦ
ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Xinding No. 19 ”), Qingdao Xinding Kenge No. 20
Equity Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ (ࠢ
Υྫ)) (“ Xinding No. 20 ”) and Qingdao Xinding Kenge No. 36 Equity Investment Partnership
(Limited Partnership) (ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Xinding No. 36 ”,
Notes:
(1) being a date not more than six months prior to the date on which the relevant investor signed the first relevant
definitive agreement for their investment in the Company.
(2) Such change in the shareholding percentage during the relevant period was only due to the dilution effect as a
result of the increase in the registered capital of the Company under the Series C+ Financing completed in February
2024, with the relevant Pathfinder SII not having acquired or disposed of any Shares during such period.
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together with Xinding No. 1, Xinding No. 6, Xinding No. 18, Xinding No. 19 and Xinding No. 20,
the “ Xinding Capital SIIs ”) are limited partnerships established under the laws of the PRC, with
the same general partner, Xinding Rongsheng Capital Management Co., Ltd. ( ̏ԯอཻ࿲ସ༟͉၍
ʮ̡ )( “ Xinding Capital ”), and has full discretion to exercise investment decisions in
respect of assets managed by the Xinding Capital SIIs. Xinding Capital holds approximately
0.01%, 0.02%, 0.04%, 0.03%, 0.01% and 0.03% partnership interests in Xinding No. 1, Xinding
No. 6, Xinding No. 18, Xinding No. 19, Xinding No. 20 and Xinding No. 36, respectively. As of
the Latest Practicable Date, Xinding No. 1, Xinding No. 6, Xinding No. 18, Xinding No. 19,
Xinding No. 20 and Xinding No. 36 had 47, 31, 11, 26, 49 and 25 limited partners, with no limited
partner holding 20% partnership interests or above in any of these partnerships (except for
Gongqingcheng Mingwei Investment Partnership (Limited Partnership) (ҳ༟ΥྫΆ
ุ(Υྫ)) holding approximately 37.37% partnership interest in Xinding No. 18). Xinding
Capital is a limited liability company established under the laws of the PRC and is wholly owned
by Xinding Ronghui Capital Management Co, Ltd. (ʮ̡ )( “ Xinding
Ronghui ”), which is ultimately controlled by Mr. Zhang Chi ( ੵཱུ), an Independent Third Party.
Xinding Capital is a venture capital based in the PRC, investing primarily in cutting-edge
companies, with a focus in the fields of next generation information technology, new energy,
automobiles, semi-conductor chips, artificial intelligence, commercial aerospace and high-end
equipment manufacturing. The investment portfolio of Xinding Capital includes companies listed
on the Stock Exchange and Shanghai Stock Exchange, including Hygon Information Technology
Co., Ltd. (688041.SH), Horizon Robotics (9660.HK), Black Sesame International Holding Limited
(2533.HK), Beijing Fourth Paradigm Technology Co., Ltd. (6682.HK), XPeng Inc. (XPEV .NYSE;
9868.HK), Transwarp Technology (Shanghai) Co., Ltd. (688031.SH) and Cambricon Technologies
Corporation Limited (688256.SH). The AUM of Xinding Capital comprising of specialist
technology investments was approximately RMB5.6 billion as of December 31, 2020
(1), and
approximately RMB11.7 billion as of June 30, 2025, respectively.
As each of the Xinding Capital SIIs is ultimately controlled by the same general partner,
Xinding Capital, the different shareholding entities are purely different funds managed by the same
fund manager and should be aggregated as one Pathfinder SII pursuant to Chapter 2.5 of the
Guide.
The Xinding Capital SII held approximately 9.67% and 9.69% of the total issued share
capital of the Company, as of the date of submission of the Company’s first Listing application
and the commencement date of the pre-application 12-month period, respectively
(2).
(c) Legend Holdings SIIs (being Lianpan VC, Xinghao VC and Xingfan VC)
Horgos Lianpan Frontier Venture Capital Co., Ltd. (ʮ̡ )
(“Lianpan VC ”) is a limited liability company established under the laws of the PRC and is
principally engaged in equity investment. It is ultimately wholly owned by Legend Holdings
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Corporation (ʮ̡ ), a company listed on the Stock Exchange (stock code: 3396)
(“Legend Holdings ”). Beijing Xinghao Entrepreneurship Enterprise Management Center (Limited
Partnership) (ख௴ุΆุ၍ଣʕː (Υྫ)) (“ Xinghao VC ”) and Beijing Xingfan
Venture Capital Partnership (Limited Partnership) (૕௴ุҳ༟ΥྫΆุ (Υྫ))
(“Xingfan VC ”) are limited partnerships established under the laws of the PRC and are principally
engaged in equity investment. The general partner of Xinghao VC and Xingfan VC is Qushui
County Xinghuan Venture Capital Management Center (Limited Partnership) (ᐑ௴ุҳ༟
၍ଣʕː(Υྫ)) (“ Qushui Xinghuan ”), with full discretion to exercise investment decisions
in respect of assets managed by Xinghao VC and Xingfan VC. The limited partners of Xinghao VC
include Tibet Dongfang Qihui Investment Co., Ltd. (ʮ̡ ) holding 48.80%
of the interests therein and eight other limited partners, none of which holds one-third or more of
the interest in Xinghao VC. Qushui Xinghuan and Tibet Dongfang Qihui Investment Co., Ltd. is
ultimately controlled by Legend Holdings. The limited partners of Xingfan VC include Ningbo
Meishan Bonded Port Area Chenhai Linghui Venture Capital Partnership (Limited Partnership) ( ྐྵ
೼ಥਜԕऎᜳᅆ௴ุҳ༟ΥྫΆุ (Υྫ)) and Zibo Haihe Shengshi Equity
Investment Fund Partnership (Limited Partnership) (ΥྫΆุ (Υ
ྫ)), holding 48.25% and 46.32% of the interests therein, respectively. As of the Latest Practicable
Date, Legend Holdings has established two major business segments, being industrial operations
and industrial incubations and investment, and is committed to expanding and strengthening pillar
industries, incubating or investing in start-ups and growth-stage companies. In particular, Beijing
Legend Star Investment Management Co., Ltd. (ʮ̡ )( “ Legend
Star”) of which the Legend Holdings SIIs are held under, is an angel investment fund under
Legend Holdings, with expertise in investing in fields such as TMT, healthcare and cutting-edge
technology. The asset allocation of Legend Holdings under its financial investments business
segment was approximately RMB65.2 billion as of December 31, 2017
(1), and the asset allocation
under the industrial incubations and investment business segment of Legend Holdings was
approximately RMB98.3 billion as of June 30, 2025.
The Legend Holdings SIIs held approximately 3.49% and 3.50% of the total issued share
capital of the Company, as of the date of submission of the Company’s first Listing application
and the commencement date of the pre-application 12-month period, respectively
(2).
Our Pathfinder SIIs, in aggregate, held approximately 23.77% and 23.83% of the total issued
share capital of the Company, as of the date of submission of the Company’s first Listing
application and the commencement date of the pre-application 12-month period, respectively
(2).
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Our Other Sophisticated Independent Investor (“SII”)
(d) CEL SII (being Beta Garden)
Beta Garden Limited (“ Beta Garden ”) is a company incorporated under the laws of Hong
Kong with limited liability and is principally engaged in equity investment. Beta Garden is directly
and wholly owned by Alpha Garden Limited, a company established under the laws of the British
Virgin Islands, which is directly and wholly owned by CEL New Economy Fund, L.P., an
exempted limited partnership established under the laws of the Cayman Islands, and also a private
fund registered with Cayman Islands Monetary Authority. CEL New Economy Partners is the
general partner of CEL New Economy Fund, L.P., with full control over the conduct of the
business, assets and affairs of CEL New Economy Fund, L.P., and is a company incorporated in
the Cayman Islands with limited liability and is directly and wholly owned by China Everbright
Limited, a company listed on the Stock Exchange (stock code: 165) (“ CEL”). The limited
partnership interest of CEL New Economy Fund, L.P. is held as to 64.84% indirectly by CEL and
as to 34.80% by Investcorp, a global manager of alternative investments investing on behalf of
individual and institutional investors. CEL is a leading cross-border asset management and private
equity investment company in China, and a listed company in Hong Kong with management and
investment of private funds as the core business. With more than 26 years of experience in
cross-border asset management and equity investment, CEL has been assessed as one of the top
private equity firms in China several times. Under its fund management business, CEL has formed
a rich asset management product line covering primary market funds, secondary market funds,
FoFs, S Funds etc., and has nurtured many promising enterprises with high growth potential
alongside with investors. As of the Latest Practicable Date, CEL held approximately 2.27% of the
total issued share capital of the Company. The AUM of CEL was approximately HK$143.5 billion
as of December 31, 2018
(1), and approximately HK$119.4 billion as of June 30, 2025.
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Other key Pre-IPO Investors
Set out below is a description of each of our other key Pre-IPO Investors. These Pre-IPO
Investors, together with the Controlling Shareholders Group and the SIIs, held more than 90% of
our total issued share capital as of the date of this prospectus:
(a) CWB Startup HK and Changsha Shengyu
CWB Startup HK, an investment company ultimately controlled by Prof. Li, is wholly-owned
by Clear Water Bay Startup Fund LP, which in turn is held as to approximately 57%, 23% and
20% by Prof. Li, Ping Keung Ko (੶) and Gan Jie ( ͚ᆎ) as limited partners, respectively.
The general partner of Clear Water Bay Startup Fund LP is Clear Water Bay Startup Fund GP, with
0.00001% interest in Clear Water Bay Startup Fund LP. Clear Water Bay Startup Fund GP is in
turn held as to 57%, 23% and 20% by Prof. Li, Ping Keung Ko and Gan Jie, respectively, and has
full discretion to exercise investment decisions in respect of assets managed by CWB Startup HK.
Each of Ping Keung Ko and Gan Jie are Independent Third Parties. As of the Latest Practicable
Date, CWB Startup HK held approximately 0.76% of the total issued share capital of our
Company.
Changsha Shengyu is a limited partnership established under the laws of the PRC and is
principally engaged in equity investment. Its general partner is Changsha Luzhi Equity Investment
Management Co., Ltd (ʮ̡ )( “ Changsha Luzhi ”), holding 13.33%
interest therein with full discretion to exercise investment decisions in respect of assets managed
by Changsha Shengyu under the terms of its partnership agreement. Changsha Luzhi is wholly
owned by Changsha Intelligent Robot Research Institute Co., Ltd (ʮ
̡)( “ Changsha Intelligent Robot ”), which is in turn owned as to 25% by Dongguan Songshan
Lake Robot Industry Development Co., Ltd (ʮ̡ )( “ Dongguan
Songshan Robot ”), and as to 75% by four other shareholders with none of them holding more
than 20% equity interest in Changsha Intelligent Robot. Dongguan Songshan Robot is wholly
owned by Clear Water Bay Robotic Technology Investment (HK) Limited, which in turn is
indirectly held as to 67.67%, 12.33% and 20.00% by Prof. Li, Ping Keung Ko and Gan Jie,
respectively. As of the Latest Practicable Date, Changsha Shengyu had two limited partners with
Dongguan Yunhe being the largest one, holding 66.68% of the partnership interest in Changsha
Shengyu. Dongguan Yunhe is wholly owned by CWB Startup HK and is accordingly deemed to be
interested in by Prof. Li. The other limited partner of Changsha Shengyu, Hunan Xiangjiang
Shengshi Equity Investment Fund Partnership (Limited Partnership) (ږ
ΥྫΆุ(Υྫ)), holds 19.99% of the partnership interest in Changsha Shengyu and is an
Independent Third Party. As of the Latest Practicable Date, Changsha Shengyu held approximately
0.35% of the total issued share capital of our Company.
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Considering CWB Startup HK is controlled by Prof. Li, and the majority of the partnership
interest in Changsha Shengyu is held by CWB Startup HK, CWB Startup HK and Changsha
Shengyu are considered to be Controlling Shareholders of our Company.
(b) Founder Hesheng Investment (being Changsha Hesheng, Tibet Fangchuang and Ningbo
Jiusheng)
Changsha High-Tech Development Zone Hesheng Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Changsha Hesheng ”) is a
limited partnership established in the PRC. It is principally engaged in equity investment. Its
general partner is Changsha Lugu Venture Capital Management Co., Ltd. (Ӎᘇᇅ௴ุҳ༟၍ଣ
ʮ̡) holding 0.05% interest therein, who is primarily responsible for administering the
business activities of Changsha Hesheng. Changsha Lugu Venture Capital Management Co., Ltd. is
a limited liability company established under the laws of the PRC and is ultimately controlled by
an independent third-party, Mr. Xiao Jianxin (อ). Mr. Xiao Jianxin is a director of Changsha
Lugu Venture Capital Management Co., Ltd., with over 17 years of experience in the investment of
small-to-mid sized enterprises in the PRC. The limited partners of Changsha Hesheng include
Shenzhen Hesheng Huiying Equity Investment Center (Limited Partnership) (ᛆҳ
༟ʕː(Υྫ)) which holds 94.95% of the interests therein, and one other limited partner
which holds less than one-third of the interest therein. Shenzhen Hesheng Huiying Equity
Investment Center (Limited Partnership) is held by Founder H Fund Co., Ltd. (ࠢ
ப΂ʮ̡)( “ Founder H Fund ”) as to 71.41% as its general partner. The investment decisions of
Changsha Hesheng are made by its investment committee, of which Founder H Fund has a
three-fifths majority seat representation therein, with each of Changsha Lugu Venture Capital
Management Co., Ltd. (as general partner) and the other limited partner of Changsha Hesheng
having only one-fifths seat representation therein. Founder H Fund is wholly owned by Founder
Securities Co., Ltd. (ʮ̡ )( “ Founder Securities ”), a company listed on the
Shanghai Stock Exchange (stock code: 601901).
Tibet Fangchuang Zhengding Venture Capital Partnership (Limited Partnership) ( Гᔛ˙௴͍
ཻ௴ุҳ༟ΥྫΆุ (Υྫ)) (“ Tibet Fangchuang ”) is a limited partnership established in the
PRC. It is principally engaged in equity investment. Its general partner is Founder H Fund, holding
20.00% of the interests therein, and seven limited partners, none of which holds one-third or more
of the interest therein. The investment decisions of Tibet Fangchuang are made by its investment
committee, of which Founder H Fund has the largest seat representation therein (three out of
seven), with each of the remaining four seats held separately by other limited partners of Tibet
Fangchuang. As the general partner of Tibet Fangchuang, Founder H Fund is responsible for
carrying out the business decisions of Tibet Fangchuang, and each of the limited partners shall not
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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carry out any business on behalf of Tibet Fangchuang pursuant to the terms of the relevant
partnership agreement. Considering the limited inputs from each of the other limited partners into
the decisions of Tibet Fangchuang, Tibet Fangchuang is effectively under the control of Founder H
Fund.
Ningbo Meishan Port Jiusheng Investment Partnership (Limited Partnership) (೼
ಥਜɮ͛ҳ༟ΥྫΆุ (Υྫ)) (“ Ningbo Jiusheng ”) is a limited partnership established in
the PRC. It is principally engaged in investments in the equity investment. Its main general partner
is Founder H Fund, holding 50.00% of the interests therein, which is in turn wholly owned by
Founder Securities. The investment decisions of Ningbo Jiusheng are made by its investment
committee, of which Founder H Fund has a majority seat representation therein. The limited
partners of Ningbo Jiusheng include Beijing Ruifeng Investment Co., Ltd. (ࠢ
ʮ̡) and one other limited partner which holds less than one-third of the interest therein. Beijing
Ruifeng Investment Co., Ltd. is a limited liability company established under the laws of the PRC
and wholly owned by an independent third party, Huaxin Century Investment Group Co., Ltd. ( ശ
ʮ̡ ).
As of the Latest Practicable Date, Founder Hesheng Investment holds approximately 4.28%
of the total issued share capital of the Company.
(c) Liangjiang Fund (being Liangjiang Chengwei)
Chongqing Liangjiang New Area Chengwei Equity Investment Fund Partnership (Limited
Partnership) (ΥྫΆุ (Υྫ)) (“ Liangjiang Chengwei ”) is a
limited partnership established in the PRC. The general partner of Liangjiang Chengwei is
Chongqing Chengyun No. 2 Enterprise Management Co., Ltd. (ʮ̡ )
holding 0.02% interest therein, which in turn is held by Chongqing Liangjiang Equity Investment
Fund Management Co., Ltd. (ʮ̡ )( “ Liangjiang Fund ”),
which is held by Chongqing Liangjiang New Area Industrial Development Group Co., Ltd. (ᅅ
ʮ̡ )( “ Liangjiang Development Group ”). Chongqing Chengyun No.
2 Enterprise Management Co., Ltd., as the general partner of Liangjiang Chengwei, is responsible
for the daily operations and investment of Liangjiang Chengwei, with the core authority to execute
fund affairs. The limited partners of Liangjiang Chengwei are Liangjiang Development Group as to
79.88%, and five other limited partners as to the remaining 20.12% interest. Liangjiang
Development Group is wholly-owned by Chongqing Liangjiang New Area Management Committee
(ึ ).
As of the Latest Practicable Date, Liangjiang Fund held approximately 3.01% of the total
issued share capital of our Company.
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(d) Baidu V enture
Beijing Baidu Biwei Enterprise Management Center (Limited Partnership) (Ά
ุ၍ଣʕː (Υྫ)) (“ Baidu Venture ”) is a limited partnership established in the PRC and is
principally engaged in equity investment. Its general partner is Beijing Bai’an Innovation
Enterprise Management Center (Limited Partnership) ( ̏ԯϵτ௴อΆุ၍ଣʕː (Υྫ))
(“Bai’an Innovation ”), holding 0.36% interest therein with exclusive rights to manage and control
the operations, investment business and other affairs of Baidu Venture. Bai’an Innovation is in turn
held as to 50% by its general partner Dazi Bai’an Venture Capital Management Co., Ltd. (with no
limited partner holding over 30% partnership interest in Bai’an Innovation), which in turn is
wholly-owned by Beijing Baidu Investment Management Co., Ltd. (ʮ̡ ).
Beijing Baidu Investment Management Co., Ltd. is a consolidated group entity of and controlled
by Baidu Inc. (“ Baidu ”) (NASDAQ.BIDU; 9888.HK). The limited partner of Baidu Venture is
Dazi County Bairuixiang Venture Capital Management Co., Ltd. (ࠢ
ப΂ʮ̡), which in turn is wholly-owned by Beijing Baidu Netcom Science Technology Co., Ltd.
(ʮ̡ ). Beijing Baidu Netcom Science Technology Co., Ltd. is a limited
liability company established under the laws of the PRC and controlled by Baidu. Baidu is a
leading artificial intelligence company with strong foundations in the internet. As of the Latest
Practicable Date, Baidu Venture held approximately 2.39% of the total issued share capital of the
Company.
(e) Guangkong Zhongying
Guangkong Zhongying Industrial Investment Fund Partnership (ږ
Υྫ(Υྫ)) (“ Guangkong Zhongying ”) is a limited partnership established under the laws of
the PRC and is principally engaged in equity investment. Its general partner is Zhuhai Guangkong
Zhongheng Investment Management Co., Ltd. (ʮ̡ )( “ Zhuhai
Guangkong ”), which has full discretion to exercise investment decisions in respect of assets
managed by Guangkong Zhongying. Zhuhai Guangkong is owned as to 50% by Beijing Guangkong
Puyi Private Equity Fund Management Co., Ltd (ʮ̡ )( “ Beijing
Guangkong ”) and as to 50% by Zhuhai Zhongheng Management Consulting Partnership Enterprise
(Limited Partnership) ( मऎ଺ፅ၍ଣፔ༔ΥྫΆุ (Υྫ)) (“ Zhongheng Consulting ”).
Beijing Guangkong is wholly owned by Chongqing CEL Equity Investment Management Co., Ltd.
(ʮ̡ ), which is indirectly wholly owned by CEL, an Independent
Third Party. The general partner of Zhongheng Consulting is Zhu Ying ( ϡᆦ), with 0.01%
partnership interest, and the limited partner of Zhongheng Consulting as to 79.99% is Zhou Lei ( մ
ᆾ), each of whom is an Independent Third Party. Zhongheng Consulting is principally engaged in
equity investment. The largest limited partner of Guangkong Zhongying is Yixing Guangkong
Investment Co., Ltd. (ʮ̡ )( “ Yixing Guangkong ”), holding 49.08% of the
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partnership interests therein. Yixing Guangkong is indirectly wholly owned by CEL. As of the
Latest Practicable Date, Guangkong Zhongying held approximately 2.27% of the total issued share
capital of our Company.
(f) Xiangjiang State Investment (being Xiangjiang Investment and Xiangjiang Intelligent
Innovation)
Hunan Xiangjiang New Area State-owned Capital Investment Co., Ltd. (ಱϪอਜ਷Ϟ༟
ʮ̡ )( “ Xiangjiang Investment ”) is a limited liability company established under the
laws of the PRC and is principally engaged in venture capital investment. It is wholly owned by
State-owned Assets Supervision and Administration Commission of Changsha Municipal People’s
Government (ึ ), which is an independent third party.
Hunan Xiangjiang Intelligent Innovation Fund Partnership (Limited Partnership) (ಱϪ౽
ΥྫΆุ (Υྫ)) (“ Xiangjiang Intelligent Innovation ”) is a limited partnership
established in the PRC. It is principally engaged in the equity investment. Its general partner is
Hunan Guochuang Industry Investment Co., Ltd. (ʮ̡ ) holding 0.22% of
the interest therein, and has a majority seat representation in the investment committee of
Xiangjiang Intelligent Innovation, pursuant to which the investment decisions of Xiangjiang
Intelligent Innovation are made. Hunan Guochuang Industry Investment Co., Ltd. is a
wholly-owned subsidiary of Xiangjiang Investment. The limited partner of Xiangjiang Intelligent
Innovation as to 99.78% interest is Changsha Zhigu, a substantial shareholder of Changsha CiDi
Construction as to 33% as of the date of the prospectus. Changsha Zhigu does not hold any voting
rights in Changsha CiDi Construction and, upon completion of the Listing, Changsha Zhigu will
cease to hold any equity interest in Changsha CiDi Construction.
As of the Latest Practicable Date, Xiangjiang State Investment held approximately 2.77% of
the total issued share capital of our Company.
(g) Qingdao Zhenghan (being Qingdao Zhenghan No. 1 and Qingdao Zhenghan No. 2)
Qingdao Zhenghan Jiuyuan No. 1 Investment Management Center (͍ᖍɮჃఠ໮ҳ༟၍
ଣʕː(Υྫ)) (“ Qingdao Zhenghan No. 1 ”) and Qingdao Zhenghan Jiuyuan No. 2
Investment Center (Limited Partnership) (͍ᖍɮჃ൩໮ҳ༟ʕː (Υྫ)) (“ Qingdao
Zhenghan No. 2 ”) are limited partnerships established under the laws of the PRC and are of the
same general partner Beijing Zhenghan Hengyuan Venture Capital Co., Ltd. ( ̏ԯ͍ᖍ㛬Ⴣ௴ุҳ
ʮ̡ ) holding 14.85% and 5.71% of the interests therein respectively, with full discretion to
exercise investment decisions in respect of assets managed by Qingdao Zhenghan No. 1 and
Qingdao Zhenghan No. 2 respectively. Beijing Zhenghan Hengyuan Venture Capital Co., Ltd. is
ultimately controlled and beneficially owned by an independent third party Duan Huimin (ᅆઽ).
There are five limited partners of Qingdao Zhenghan No. 1, each of whom holds less than
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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one-third interest therein and is an independent third party. The limited partners of Qingdao
Zhenghan No. 2 are Xiao Yanhui ( ӽᜮฯ) as to 50% and Yang Chaofan ( เ൴ω) as to 44.29%,
each of whom is an independent third party. As of the Latest Practicable Date, Qingdao Zhenghan
held approximately 1.97% of the total issued share capital of our Company.
(h) Qinghao Capital (being Qinghao Yuanmao and Qinghao Deruo)
Hunan Qinghao Yuanmao Private Equity Fund Partnership (Limited Partnership) (ႃʩ
ΥྫΆุ (Υྫ)) (“ Qinghao Yuanmao ”) is a limited partnership established
in the PRC and is principally engaged in equity investment. Its general partner is Jiaxing Qinghao
Investment Co., Ltd. (ʮ̡ )( “ Jiaxing Qinghao ”) holding 0.05% of the interest
therein, with full discretion to exercise investment decisions in respect of assets managed by
Qinghao Yuanmao. Jiaxing Qinghao is ultimately controlled and beneficially owned by an
independent third-party Chen Yun ( ௓ㄴ). Qinghao Yuanmao has 15 limited partners, none of
which holds one-third or more of the interest therein.
Hunan Qinghao Deruo Private Equity Investment Partnership (Limited Partnership) (ڡی
ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Qinghao Deruo ”) is a limited partnership established
in the PRC and is principally engaged in equity investment. Its general partners are Jiaxing
Qinghao holding 0.0099% of the interest therein and Chen Yun holding 0.9856% of the interest
therein, who together have full discretion to exercise investment decisions in respect of assets
managed by Qinghao Deruo. Jiaxing Qinghao is in turn ultimately controlled and beneficially
owned by Chen Yun. Qinghao Deruo has 43 limited partners, none of which holds one-third or
more of the interest therein.
As of the Latest Practicable Date, Qinghao Capital held approximately 2.33% of the total
issued share capital of our Company.
(i) Qiandao Capital (being Qiandao Ronghui and Jiangxia Xintuo)
Qingdao Qiandao Ronghui Investment Management Center (Limited Partnership) (৻༸
࿲ሾҳ༟၍ଣʕː (Υྫ)) (“ Qiandao Ronghui ”) is a limited partnership established under
the laws of the PRC and is principally engaged in equity investment. The general partner is
Qiandao Investment Fund Management (Beijing) Ltd. Co., (ʮ̡ )
(“Qiandao Investment ”), holding 2.32% of the interests therein with full discretion to exercise
investment decisions in respect of assets managed by Qiandao Ronghui. Qiandao Investment is
wholly-owned by Qiandao Investment Holding Group Co., Ltd (ʮ̡ ),
which is in turn owned as to 60.78% by Yan Zurong (࢙and as to 39.22% by two other
shareholders with none of them holding more than 30.00% equity interest of Qiandao Investment.
As of the Latest Practicable Date, Qiandao Ronghui has 21 limited partners with Qingdao Qiandao
Honor Investment Management Center (Limited Partnership) (৻༸࿲ᘴҳ༟၍ଣʕː (Υ
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ྫ)) (“ Qiandao Honor ”) being the largest one, holding 26.19% partnership interest in Qiandao
Ronghui, and none of the remaining 20 limited partners holding more than 22.82% partnership
interest in Qiandao Ronghui. Qiandao Honor is managed by Qiandao Investment with 49 limited
partners, and none of them holding more than 5% partnership interest in Qiandao Honor.
Wuhan Jiangxia Xintuo Equity Investment Fund Management Partnership (Limited
Partnership) (၍ଣΥྫΆุ (Υྫ)) (“ Jiangxia Xintuo ”), is a
limited partnership established under the laws of the PRC and is principally engaged in equity
investment. The general partner is Xinxing Private Equity Fund Management Co., Ltd. ( อጳӷ෍
ʮ̡ )( “ Xinxing Fund ”), holding 1% of the interests therein with full discretion to
exercise investment decisions in respect of assets managed by Jiangxia Xintuo. Xinxing Fund is
wholly owned by China Xinxing Asset Management Co., Ltd (ப΂ʮ̡ )
(“Xinxing Asset ”). Xinxing Asset is owned (i) as to 40% by General Technology Group Asset
Management Co., Ltd. (ʮ̡ ), a subsidiary of China General
Technology Group ( ʕ਷ஷ͜Ҧஔණྠ ), (ii) as to 38% by Qiandao Technology Group Co., Ltd ( ৻
ʮ̡ ), which is in turn owned as to 99% by Yan Zurong (࢙and (iii) as to
22% by Beijing Shihua Hengyi Technology Co., Ltd (ʮ̡ ), which is in
turn indirectly owned as to 80% by Teng Yunpeng ( ᆚථᘄ). As of the Latest Practicable Date,
Jiangxia Xintuo has four limited partners with Qingdao Qiandao Yunian Investment Management
Center (Limited Partnership) (৻༸◔ϋҳ༟၍ଣʕː (Υྫ)) (“ Qiandao Yunian ”) being
the largest one, holding 45% partnership interest in Jiangxia Xintuo, and none of the remaining
three limited partners holding more than 24% partnership interest in Jiangxia Xintuo. Qiandao
Yunian is managed by Qiandao Investment with 43 limited partners, and none of them holding
more than 4.16% partnership interest in Qiandao Yunian. To the best knowledge of the Directors,
each of Qiandao Capital and its ultimate beneficial owner is an independent third party.
As of the Latest Practicable Date, Qiandao Capital held approximately 1.10% of the total
issued share capital of our Company.
(j) Ruishi Capital (being Zhitu No. 1 and Ruichuang Zhitu)
Hainan Zhitu No. 1 Venture Capital Partnership (Limited Partnership) (౽௄ɓ໮௴ุҳ
༟ΥྫΆุ (Υྫ)) (“ Zhitu No. 1 ”) is a limited partnership established in the PRC and is
principally engaged in equity investment. Its general partner is Hunan Ruishi Private Equity Fund
Management Co., Ltd. (ʮ̡ )( “ Hunan Ruishi ”) holding 0.22%
of the interests therein, with full discretion to exercise investment decisions in respect of assets
managed by Zhitu No. 1, and its largest limited partners are Dai Jun (ࠏand Zhang Guan ( ੵ
ڿholding 30.78% and 23.25% interest therein respectively. Hunan Ruishi is ultimately
controlled and beneficially owned by an independent third-party Dai Bin ( Ꮦⅳ).
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Chengdu Ruichuang Zhitu Venture Capital Partnership (Limited Partnership) ( ϓே๿௴౽௄
௴ุҳ༟ΥྫΆุ (Υྫ)) (“ Ruichuang Zhitu ”) is a limited partnership established in the
PRC and is principally engaged in equity investment. Its general partners are Hunan Ruishi
(holding 1.62% of the interests therein) and Chengdu Technology Transfer Venture Capital Co.,
Ltd. (ʮ̡ ) (holding 0.48% of the interests therein), who together have full
discretion to exercise investment decisions in respect of assets managed by Ruichuang Zhitu, and
the largest limited partner as to 94.76% is Chengdu Science and Technology Innovation Investment
Group Co., Ltd. (ʮ̡ ), an independent third party. Chengdu
Technology Transfer Venture Capital Co., Ltd. is wholly owned by Chengdu Science and
Technology Innovation Investment Group Co., Ltd., which is ultimately controlled and beneficially
owned by Chengdu Municipal State-owned Assets Supervision and Administration Commission ( ϓ
ึ ).
As of the Latest Practicable Date, Ruishi Capital held approximately 2.75% of the total
issued share capital of our Company.
Meaningful investment from Sophisticated Independent Investors
We have received investments from three Pathfinder SIIs, namely HongShan, Xinding Capital
and Legend Holdings, each having invested in the Group for at least 12 months prior to the first
submission of our listing application to the Stock Exchange for the purpose of the Global Offering.
In accordance with Chapter 2.5 of the Guide, each of HongShan, Xinding Capital and Legend
Holdings holds more than 3%, and in aggregate more than 10%, of the issued share capital of the
Company as of the date of our listing application and throughout the pre-application 12-month
period. For details of the ownership percentage of shareholding in our Company’s share capital of
each of the Sophisticated Independent Investors, see “— Capitalization of Our Company”.
As of the Latest Practicable Date, our Sophisticated Independent Investors (as identified
above) held, in aggregate, approximately 26.04% in the total issued share capital of our Company.
At Listing, such Sophisticated Independent Investors will hold, in aggregate, no less than 20% in
the total issued share capital of our Company, assuming that our expected market capitalization at
the time of Listing will exceed HK$4 billion.
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PUBLIC FLOAT
Immediately upon completion of the Global Offering (assuming the Over-allotment Option is
not exercised), the Company will have 1,345,418 Domestic Unlisted Shares and 42,443,892 H
Shares, among which:
(i) the 1,345,418 Domestic Unlisted Shares (representing approximately 3.07% of our total
issued Shares upon Listing assuming the Over-allotment Option is not exercised) will
not be considered as part of the public float as such Domestic Unlisted Shares will not
be converted into H Shares; and
(ii) among the 42,443,892 H Shares,
a. the 16,750,130 H Shares held by NovoDriv HK, Changsha Gangwan, CWB Startup
HK and Changsha Shengyu to be converted from Domestic Unlisted Shares
pursuant to the Full Circulation Application of the Company and listed on the
Stock Exchange (representing approximately 38.25% of our total issued Shares
upon Listing assuming the Over-allotment Option is not exercised) will not be
counted towards the public float for the purpose of Rule 8.08 of the Listing Rules
after the Listing as such Shares are held by our Controlling Shareholders and
therefore constitute Shares held by core connected persons of our Company;
b. the 20,285,782 H Shares to be converted from Domestic Unlisted Shares pursuant
to the Full Circulation Application of the Company and listed on the Stock
Exchange (representing approximately 46.33% of our total issued Shares upon
Listing assuming the Over-allotment Option is not exercised). These H Shares are
held by our Pre-IPO Investors as further detailed in “Capitalization of Our
Company” below, will be counted towards the public float for the purpose of Rule
8.08 of the Listing Rules after the Listing as these entities will not be core
connected persons of our Company upon Listing nor are they accustomed to take
instructions from the Company’s core connected persons in relation to the
acquisition, disposal, voting or other disposition of their Shares and their
acquisition of Shares were not financed directly or indirectly by the Company’s
core connected persons; and
c. 5,407,980 H Shares will be issued pursuant to the Global Offering assuming
Over-allotment Option is not exercised.
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Details of the Conversion of Domestic Unlisted Shares into H Shares pursuant to the Full
Circulation Application are set out below:
Number of Shares upon Listing
Name of Shareholder
Number of
Domestic Unlisted
Shares as of the
Latest Practicable
Date
Domestic Unlisted
Shares
H Shares
converted from
Domestic Unlisted
Shares
NovoDriv HK ....................... 11,443,151 — 11,443,151
Changsha Gangwan ................... 4,883,250 — 4,883,250
CWB Startup HK .................... 290,750 — 290,750
Changsha Shengyu ................... 132,979 — 132,979
Sub-total .......................... 16,750,130 — 16,750,130
Pre-IPO Investors .................... 21,631,200 1,345,418 (1) 20,285,782
Total .............................. 38,381,330 1,345,418 37,035,912
Note:
(1) Includes 46,542, 231,426, 927,093 and 140,357 Domestic Unlisted Shares held by Lakeside VC, Chengdu
Technology VC, Ruichuang Zhitu and Ceyuan Guangyi Digital Fund respectively, which were not converted to H
Shares pursuant to the Full Circulation and the above shares held by these four Pre-IPO Investors will remain as
Domestic Unlisted Shares upon the Listing.
Based on the Offer Price of HK$263.00 per H Share, the market capitalization of the
Company is HK$11,516.59 million. The public float of the Company will be 58.68% upon Listing
(assuming the Over-allotment Option is not exercised) which is higher than the prescribed
percentage of 15% of H Shares required to be held in public hands pursuant to Rule 19A.13A(1)
of the Listing Rules.
FREE FLOAT
Rule 19A.13C of the Listing Rules provides that, where a new applicant is a PRC issuer with
no 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 10% of the total number of issued shares in the class to which H shares
belong at the time of listing (excluding treasury shares), 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.
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It is expected that immediately following completion of the Global Offering, a market
capitalization of approximately HK$876.21 million of the H Shares listed on the Stock Exchange
are not subject to any disposal restrictions at the time of Listing (assuming an Offer Price of
HK$263.00 per Offer Share assuming the Over-allotment Option is not exercised). Therefore, our
Company will be able to meet the requirement under Rule 19A.13C of the Listing Rules.
LOCK-UP PERIODS
The table below sets out the list of persons who are, together with their respective close
associates, subject to the lock-up requirements pursuant to Rule 18C.14 of the Listing Rules:
Person(s) Capacity
Number of Shares subject
to disposal restrictions
immediately following the
completion of the Global
Offering (1)
Shareholding subject to
disposal restrictions
immediately following
completion of the Global
Offering (1)
Lock-up period
for a Commercial Company (2)
Key Persons
Prof. Li (3) ........ Founder, chairman of
the Board and
non-executive
Director
16,750,130
(4) 38.25% Commencing on the date of this
prospectus and ending on the date
which is 12 months from the
Listing Date (i.e. December 18,
2026)
Dr. Ma
(3) ......... Co-founder, executive
Director and vice
chairman
11,443,151
(5) 26.13% Commencing on the date of this
prospectus and ending on the date
which is 12 months from the
Listing Date (i.e. December 18,
2026)
Dr. Hu Albert Sibo
(3) .. Executive Director
and chief executive
officer
138,270
(6) 0.32% Commencing on the date of this
prospectus and ending on the date
which is 12 months from the
Listing Date (i.e. December 18,
2026)
Pathfinder SIIs
HongShan SII
(7) ..... Pathfinder SII 4,070,500 9.30% Commencing on the date of this
prospectus and ending on the date
which is 6 months from the
Listing Date (i.e. June 18, 2026)
Xinding Capital SIIs
(8) .. Pathfinder SII 3,710,820 8.47% Commencing on the date of this
prospectus and ending on the date
which is 6 months from the
Listing Date (i.e. June 18, 2026)
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Person(s) Capacity
Number of Shares subject
to disposal restrictions
immediately following the
completion of the Global
Offering (1)
Shareholding subject to
disposal restrictions
immediately following
completion of the Global
Offering (1)
Lock-up period
for a Commercial Company (2)
Legend Holdings SII (9) .. Pathfinder SII 1,340,348 3.06% Commencing on the date of this
prospectus and ending on the date
which is 6 months from the
Listing Date (i.e. June 18, 2026)
Notes:
(1) Assuming that the Over-allotment Option is not exercised.
(2) Pursuant to the PRC Company Law, each of the existing Shareholders of the Company (including the Key Persons
and Pathfinder SIIs) are not permitted to dispose of any of the Shares held by them within the 12 months
immediately following the Listing Date.
(3) Prof. Li, Dr. Ma and Dr. Hu Albert Sibo are key persons responsible for our technical operations and/or the
research and development of our Specialist Technology Products, and the Shares he is deemed to be interested in
shall be subject to lock-up requirements pursuant to Rule 18C.14 of the Listing Rules.
(4) As of the date of this prospectus, Prof. Li is deemed to be interested in (i) the 11,443,151 H Shares held by
NovoDriv HK, the general partner of which is NovoDriv Limited, which in turn is wholly-owned by Prof. Li; (ii)
the 4,883,250 H Shares held by Changsha Gangwan, which (a) is directly held as to 99% by Prof. Li as the limited
partner, and (b) is held as to 1% by Dongguan Intelligence as the general partner, which in turn is controlled by
Prof. Li; (iii) the 290,750 H Shares held by CWB Startup HK, which is controlled by Prof. Li; and (iv) the 132,979
H Shares held by Changsha Shengyu, the majority of the partnership interest of which is held by CWB Startup HK.
(5) As of the date of this prospectus, Dr. Ma is indirectly interested in 25.66% the 11,443,151 H Shares held by
NovoDriv HK given 25.66% partnership interest in NovoDriv HK.
(6) As of the Latest Practicable Date, Dr. Hu Albert Sibo was granted Options under the Share Incentive Scheme for up
to 138,270 Shares, entitling him to receive dividends and other economic rights attributable to such Shares. Please
refer to “Appendix VII — Statutory and General Information — D. Share Incentive Scheme” for further
information.
(7) Representing the 4,070,500 H Shares to be held by Beijing HongShan upon completion of the Global Offering.
(8) Representing the 1,041,926 H Shares, 786,247 H Shares, 147,790 H Shares, 384,304 H Shares, 1,010,170 H Shares
and 340,383 H Shares held by Xinding No. 1, Xinding No. 6, Xinding No. 18, Xinding No. 19, Xinding No. 20 and
Xinding No. 36 respectively, upon completion of the Global Offering.
(9) Representing the 581,500 H Shares, 581,500 H Shares and 177,348 H Shares held by Lianpan VC, Xinghao VC and
Xingfan VC respectively, upon completion of the Global Offering.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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CAPITALIZATION OF OUR COMPANY
The following table sets out our shareholding structure (a) as of the date of this prospectus and (b) immediately upon the completion
of the Global Offering and the Full Circulation Application (assuming that the Over-allotment Option is not exercised):
As of the date of this prospectus
Immediately following the completion of the Global Offering and the Full Circulation Application
(assuming the Over-allotment Option is not exercised)
Shareholder
Number of Domestic
Unlisted Shares
Shareholding in the
Domestic Unlisted
Shares
Number of Domestic
Unlisted Shares
Shareholding in the
Domestic Unlisted
Shares Number of H Shares
Shareholding in the
H Shares
Number of Total
Shares
Shareholding in the
total issued share
capital
NovoDriv HK ........... 11,443,151 29.81% — — 11,443,151 26.96% 11,443,151 26.13%
Changsha Gangwan ........ 4,883,250 12.72% — — 4,883,250 11.51% 4,883,250 11.15%
CWB Startup HK ......... 290,750 0.76% — — 290,750 0.69% 290,750 0.66%
Changsha Shengyu ........ 132,979 0.35% — — 132,979 0.31% 132,979 0.30%
Sub-total .............. 16,750,130 43.64% — — 16,750,130 39.46% 16,750,130 38.25%
HongShan ............. 4,070,500 10.61% — — 4,070,500 9.59% 4,070,500 9.30%
Xinding Capital .......... 3,710,820 9.67% — — 3,710,820 8.74% 3,710,820 8.47%
Founder Hesheng Investment ... 1,644,550 4.28% — — 1,644,550 3.87% 1,644,550 3.76%
Legend Holdings .......... 1,340,348 3.49% — — 1,340,348 3.16% 1,340,348 3.06%
Liangjiang Fund .......... 1,156,337 3.01% — — 1,156,337 2.72% 1,156,337 2.64%
Xiangjiang State Investment .... 1,063,995 2.77% — — 1,063,995 2.51% 1,063,995 2.43%
Ruishi Capital ........... 1,056,557 2.75% 927,093 68.91% 129,464 0.31% 1,056,557 2.41%
Baidu ................ 916,602 2.39% — — 916,602 2.16% 916,602 2.09%
Qinghao Capital .......... 894,427 2.33% — — 894,427 2.11% 894,427 2.04%
CEL ................ 872,250 2.27% — — 872,250 2.06% 872,250 1.99%
Guangkong Zhongying ....... 872,250 2.27% — — 872,250 2.06% 872,250 1.99%
Qingdao Zhenghan ......... 756,287 1.97% — — 756,287 1.78% 756,287 1.73%
Qiandao Capital .......... 421,973 1.10% — — 421,973 0.99% 421,973 0.96%
Sanze Capital (1) .......... 312,968 0.82% — — 312,968 0.74% 312,968 0.71%
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As of the date of this prospectus
Immediately following the completion of the Global Offering and the Full Circulation Application
(assuming the Over-allotment Option is not exercised)
Shareholder
Number of Domestic
Unlisted Shares
Shareholding in the
Domestic Unlisted
Shares
Number of Domestic
Unlisted Shares
Shareholding in the
Domestic Unlisted
Shares Number of H Shares
Shareholding in the
H Shares
Number of Total
Shares
Shareholding in the
total issued share
capital
Lens Technology (2) ........ 290,750 0.76% — — 290,750 0.69% 290,750 0.66%
Juncheng Hongxin (3) ....... 236,464 0.61% — — 236,464 0.56% 236,464 0.54%
Chengdu Technology VC (4) .... 231,426 0.60% 231,426 17.20% — — 231,426 0.53%
Chuanghe Huimao (5) ....... 219,602 0.57% — — 219,602 0.52% 219,602 0.50%
Xingxiang Fangzheng (6) ...... 219,602 0.57% — — 219,602 0.52% 219,602 0.50%
Xinjun Electronics (7) ....... 199,468 0.52% — — 199,468 0.47% 199,468 0.46%
Guotou Chuangying (8) ....... 150,000 0.39% — — 150,000 0.35% 150,000 0.34%
Yunfa Ruichi (9) .......... 147,791 0.39% — — 147,791 0.35% 147,791 0.34%
Ceyuan Guangyi Digital Fund (10) . 140,357 0.37% 140,357 10.43% — — 140,357 0.32%
Xindiyuan Investors (11) ...... 139,359 0.36% — — 139,359 0.33% 139,359 0.32%
Baodechang (12) .......... 120,737 0.31% — — 120,737 0.28% 120,737 0.28%
Jingkai Qitao (13) .......... 112,320 0.29% — — 112,320 0.26% 112,320 0.26%
Tianjin Shengde (14) ........ 109,801 0.29% — — 109,801 0.26% 109,801 0.25%
Nanjing Bestway (15) ........ 81,502 0.21% — — 81,502 0.19% 81,502 0.19%
Hunan Zhibo (16) .......... 75,668 0.20% — — 75,668 0.18% 75,668 0.17%
Lakeside VC (17) .......... 66,489 0.17% 46,542 3.46% 19,947 0.05% 66,489 0.15%
Sub-total .............. 21,631,200 56.36% 1,345,418 100% 20,285,782 47.79% 21,631,200 49.40%
Investors taking part in the Global
Offering ............. ———— 5,407,980 12.74% 5,407,980 12.35%
Total ................ 38,381,330 100% 1,345,418 100% 42,433,892 100% 43,789,310 100%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Notes:
(1) Represents interests held by Guangdong Xiangsanze Pharmaceutical Venture Capital Enterprise (Limited
Partnership) (ಱɧዣᔼᖹ௴ุҳ༟Άุ (Υྫ)) (“ Xiangsanze Capital ”) and Hunan Sanze Investment
Management Center (Limited Partnership) (ɧዣҳ༟၍ଣʕː (Υྫ)) (“ Sanze Investment ”).
(2) Represents interests held by Lens Technology Co., Ltd (ʮ̡ )( “ Lens Technology ”).
(3) Represents interests held by Shenzhen Juncheng Hongxin Investment Partnership (Limited Partnership) ( ଉέ̹ё
ҳ༟ΥྫΆุ (Υྫ)) (“ Juncheng Hongxin ”).
(4) Represents interests held by Chengdu Science and Technology Innovation Investment Group Co., Ltd (Ҧ௴
ʮ̡ )( “ Chengdu Technology VC ”).
(5) Represents interests held by Jiaxing Chuanghe Huimao Equity Investment Partnership (Limited Partnership) ( ྗጳ
ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Chuanghe Huimao ”).
(6) Represents interests held by Hunan Xingxiang Fangzheng Equity Investment Fund Enterprise (Limited Partnership)
(Άุ (Υྫ)) (“ Xingxiang Fangzheng ”).
(7) Represents interests held by Huzhou Xinjun Electronic Technology Partnership (Limited Partnership) (ཥ
ҦΥྫΆุ (Υྫ)) (“ Xinjun Electronics ”).
(8) Represents interests held by Zibo Xuanshi Chuangying Equity Investment Partnership (Limited Partnership) ( ଍௹
ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Zibo Xuanshi ”) and Zibo Hongshi Chuangying Equity Investment
Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ (Υྫ)) (“ Zibo Hongshi ”).
(9) Represents interests held by Hunan Yunfa Ruichi Venture Capital Partnership (Limited Partnership) (ථ೯ቚཱུ
௴ุҳ༟ΥྫΆุ (Υྫ)) (“ Yunfa Ruichi ”).
(10) Represents interests held by Chengdu Ceyuan Guangyi Digital Economy Equity Investment Fund Partnership
(Limited Partnership) (ΥྫΆุ (Υྫ)) (“ Ceyuan Guangyi Digital
Fund”).
(11) Represents interests held by Chen Junying, Zhou Hanzhong, Ren Xiaopei, Yang Xiaoni and Zhou Pingyong.
(12) Represents interests held by Shenzhen Baodechang Investment Co., Ltd. (ʮ̡ )
(“Baodechang ”).
(13) Represents interests held by Jiaxing Jingkai Qitao Equity Investment Partnership (Limited Partnership) ( ྗጳ౺௱ᄁ
ᛆҳ༟ΥྫΆุ (
Υྫ)) (“ Jingkai Qitao ”).
(14) Represents interests held by Tianjin Shengde Jiaye Enterprise Management Center (Limited Partnership) (ସᅃ
ྗุΆุ၍ଣʕː (Υྫ)) (“ Tianjin Shengde ”).
(15) Represents interests held by Nanjing Bestway Intelligent Control Technology Co., Ltd. (΅Ϟ
ʮ̡)( “ Nanjing Bestway ”), a joint stock limited company established under the laws of the PRC and listed on
the Shenzhen Stock Exchange (stock code: 301195).
(16) Represents interests held by Hunan Zhibo Deruo Venture Capital Partnership (Limited Partnership) (߰
௴ุҳ༟ΥྫΆุ (Υྫ)) (“ Zhibo Deruo ”).
(17) Represents interests held by Yuewan Lakeside Venture Capital (Dongguan) Enterprise (Limited Partnership) ( ຽᝄ
ಳऱ௴ุҳ༟ (୷)Άุ(Υྫ)) (“ Lakeside VC ”).
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Share Incentive Scheme
We have established Changsha Gangwan as the Company’s share incentive platform, to
further bolster the corporate governance structure, improve the incentive mechanism, encourage
outstanding employees and consultants (the “ Scheme Participants ”) to be more proactive, and
foster the sense of responsibility among the Scheme Participants to promote the stable, continuous
and rapid growth of the Company. We adopted the Share Incentive Scheme on September 23, 2024
pursuant to which the Company will grant option(s) (“ Option(s) ”) to the Scheme Participants to
acquire unit(s) (“ Unit(s) ”) in the 4,305,280 Shares held by Changsha Gangwan in the Company
(out of the 4,883,250 Shares in total held by Changsha Gangwan). For details of the Share
Incentive Scheme, see “Appendix VII — Statutory and General Information — D. Share Incentive
Scheme”.
CORPORATE STRUCTURE
Corporate Structure immediately prior to the completion of the Global Offering
The following diagram illustrates the simplified corporate and shareholding structure of our
Company immediately prior to the completion of the Global Offering:
Changsha Shengyu(5) Pre-IPO Investors(6)
29.81% 12.72% 0.76% 0.35%
68.67% 100% 57%
56.36%
CWB Startup HK(4)Changsha
Gangwan(3)NovoDriv HK(2)
Prof. Li(1)
Company
100% 100% 100% 100% 100% 100% 80% 66.67% 51%
CiDi Chengdu
CiDi Intelligent Driving
(Hainan) Technology
Co., LTD (౽ቷ
(ی)ʮ̡)
Liuzhou CiDi
Intelligent Driving
Technology Co., LTD
(Ҧ
ʮ̡)
Xiangyang CiDi
Intelligent Network
Technology Co., LTD
(౽ঐၣᑌ
ʮ̡)
Tianjin CiDi NovoDriv Chongqing
Shenzhen CiDi
Intelligent Network
Technology Co., LTD
(ၣᑌ௴อ
ʮ̡)(7)
Changsha CiDi
Construction(8)
Anhui CiDi
Engineering
Technology Co., Ltd
(Ҧ
ʮ̡)(9)
shareholding
Notes:
(1) Prof. Li’s beneficial interest in the Company include (i) 29.81% of the equity interest in the Company held through
NovoDriv HK, of which Prof. Li holds 68.67% partnership interest in through NovoDriv Limited; (ii) 0.76% of the
equity interest in the Company held through CWB Startup HK, of which Prof. Li holds approximately 57%
partnership interest in; and (iii) 0.35% of the equity interest in the Company held through Changsha Shengyu, of
which Prof. Li holds 66.68% partnership interest in through Dongguan Yunhe, and 13.33% through Changsha
Luzhi.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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(2) The general partner of NovoDriv HK is NovoDriv Limited, which in turn is wholly-owned by Prof. Li. As of the
Latest Practicable Date, NovoDriv HK was held as to 68.67% by NovoDriv Limited, 25.66% by Dr. Ma, 2.63% by
Yang Xi, 1.62% by Hu Jishan (ᘱഛ) the father of Hu Albert Sibo, our executive Director and chief executive
officer, and 1.42% by CWB Startup HK.
(3) As of the Latest Practicable Date, Changsha Gangwan was held as to 99% by Prof. Li as limited partner, and as to
1% by Dongguan Intelligence (which is owned by Prof. Li as to 99.9%) as general partner. At the time of
establishment of Changsha Gangwan, Prof. Li and Yang Xi, our non-executive Director, entered into a nominee
arrangement (the “ Nominee Arrangement ”) pursuant to which Prof. Li had originally entrusted Ms. Yang to hold
99% limited partnership interest in Changsha Gangwan on his behalf for administration convenience, as Prof. Li
also had many other commitments outside of Changsha Gangwan, which ensured that the day-to-day functions of
Changsha Gangwan were carried out in a timely manner. The Nominee Arrangement was subsequently terminated
on October 23, 2024. As advised by our PRC Legal Adviser, the arrangements under the Nominee Arrangement and
subsequent termination of such arrangements are in compliance with the relevant PRC laws and regulations.
(4) CWB Startup HK is wholly-owned by Clear Water Bay Startup Fund LP, which in turn is held as to approximately
57%, 23% and 20% by Prof. Li, Ping Keung Ko (੶) and Gan Jie ( ͚ᆎ) as limited partners, respectively. The
general partner of Clear Water Bay Startup Fund LP is Clear Water Bay Startup Fund GP, with 0.00001% interest in
Clear Water Bay Startup Fund LP. Clear Water Bay Startup Fund GP is in turn held as to 57%, 23% and 20% by
Prof. Li, Ping Keung Ko and Gan Jie, respectively. Each of Ping Keung Ko and Gan Jie are Independent Third
Parties. CWB Startup HK indirectly holds approximately 66.68% of the partnership interest of Changsha Shengyu.
(5) Please refer to “— Pre-IPO Investments — Information relating to our key Pre-IPO Investors — Other key Pre-IPO
Investors — (a) CWB Startup HK and Changsha Shengyu” for further background information on Changsha
Shengyu, the general partner of which is controlled by Prof. Li.
(6) Please refer to the chart under “— Capitalization of our Company” in this section for a list of the Pre-IPO Investors
(excluding CWB Startup HK and Changsha Shengyu) and their shareholding percentage in the Company.
(7) The remaining 20% equity interest in Shenzhen CiDi Intelligent Network Technology Co., Ltd. is held by Shenzhen
Shenkechuang Industrial Development Co., Ltd. (ʮ̡ ), an Independent Third Party.
(8) The remaining 33.33% equity interest in Changsha CiDi Construction is held by Changsha Zhigu, an Independent
Third Party and a state-owned enterprise. To demonstrate the government’s support for our industrial park
development, Changsha Zhigu subscribed to a 33.33% equity stake in Changsha Cidi Construction, but has not
made any capital contribution. According to the Shareholders’ Agreement of Changsha Cidi Construction, both
shareholders of Changsha Cidi Construction agree that Changsha Zhigu does not hold any voting rights in
Changsha CiDi Construction and, upon completion of the Listing, Changsha Zhigu will transfer its equity interest
in Changsha CiDi Construction to the Company and Changsha CiDi Construction will be a wholly-owned
subsidiary of the Company. The Company is not expected to record any gain for the acquisition of the equity
interests in Changsha Cidi Construction from Changsha Zhigu upon Listing.
(9) The remaining 49% equity interest in Anhui CiDi Engineering Technology Co., Ltd. is held by Anhui Zhilian
Interconnect Engineering Technology Co., Ltd. (ʮ̡ ), an Independent Third Party.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Corporate Structure immediately following the Global Offering
The following diagram illustrates the simplified corporate and shareholding structure of our
Company immediately following the completion of the Global Offering (assuming the
Over-allotment Option is not exercised): Company
Prof. Li(1)
49.40% 12.35%0.30%0.66%11.15%26.13%
68.67% 100% 57%
100% 100% 100% 100% 100% 100% 80% 66.67% 51%
CiDi Chengdu
CiDi Intelligent Driving
(Hainan) Technology
Co., LTD (౽ቷ
(ی)ʮ̡)
Liuzhou CiDi
Intelligent Driving
Technology Co., LTD
(Ҧ
ʮ̡)
Xiangyang CiDi
Intelligent Network
Technology Co., LTD
(౽ঐၣᑌ
ʮ̡)
Tianjin CiDi NovoDriv Chongqing
Shenzhen CiDi
Intelligent Network
Technology Co., LTD
(ၣᑌ௴อ
ʮ̡)(7)
Changsha CiDi
Construction(8)
Anhui CiDi
Engineering
Technology Co., Ltd
(Ҧ
ʮ̡)(9)
control
shareholding
Changsha Shengyu(5) Public ShareholdersOther Pre-IPO
Investors(6)CWB Startup HK(4)Changsha
Gangwan(3)NovoDriv HK(2)
Please refer to Notes (1) to (9) in the preceding structure chart.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 229 ---
OVERVIEW
Who We Are
We are an innovative product-driven provider of intelligent driving products and solutions for
commercial vehicles in China. We focus on the research and development of closed-environment
autonomous driving trucks for mining and logistics, V2X (vehicle-to-everything) technologies and
intelligent perception solutions, and offer products and solutions underpinned by proprietary
technologies, with a primary focus on intelligent driving in closed environments during the Track
Record Period. According to CIC:
 We ranked sixth among all commercial vehicle intelligent driving companies in China
(including Hong Kong, Macau and Taiwan), with a market share of approximately 5.2%.
 We delivered 56 autonomous mining trucks for a mining site in China (including Hong
Kong, Macau and Taiwan) in mixed traffic with ~500 manned trucks, the world’s largest
mixed-operation mining fleet
(1) as of the Latest Practicable Date.
 We delivered the first fully driverless electric mining fleet in China (including Hong
Kong, Macau and Taiwan).
 We ranked third in China (including Hong Kong, Macau and Taiwan)’s autonomous
mining truck solution market in terms of revenue in 2024.
 We are among the first intelligent driving companies in China (including Hong Kong,
Macau and Taiwan) to launch commercial V2X products.
 Our train autonomous perception system (TAPS) is the only product in China (including
Hong Kong, Macau and Taiwan) capable of independent safety perception (2) for trains.
Inherent challenges persist in mining, transportation and rail transit, where safety is a primary
concern. Harsh conditions in mining operations lead to frequent accidents. Although the global
mining sector only employs 1% of the total workforce, it is responsible for approximately 8% of
fatal occupational accidents, according to CIC. Additionally, traffic accidents significantly impact
the safety and efficiency of public commuting.
Notes:
(1) “Autonomous mining trucks” refers to autonomous driving trucks designed for mining operations.
“Mixed-operation” refers to scenarios involving both manned and unmanned mining trucks.
(2) Without relying on existing railway signaling systems or additional track-side devices.
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To address these safety issues, we offer solutions underpinned by innovative algorithms and
reliable engineering designs. Our approach exemplifies “new quality productive forces”
emphasizing safety, efficiency, comfort and environmental consciousness, while tackling persistent
industry challenges. We achieved 24/7 continuous operations in various business use cases, where
our products and solutions have remained accident-free since their launch.
Drawing upon innovative methodology technology capabilities, we developed products and
solutions encompassing (i) autonomous driving technologies, delivering closed-environment
autonomous mining trucks and offering closed-environment autonomous logistics truck solutions;
(ii) V2X products and solutions for intelligent transportation and smart cities; and (iii) intelligent
perception solutions for rail transit and commercial vehicles.
Our pioneering closed-environment autonomous mining truck solution, METAMINE,
automates labor-intensive mining operations by integrating our proprietary algorithms with
widely-used intelligent driving hardware for commercial vehicles, enabling autonomous operation
and remote monitoring of driverless mining trucks. A challenging but critical process in
autonomous mining is deploying driverless mining trucks alongside existing human-driven vehicles
at mining sites, as it is costly and often impractical to transition to fully autonomous mining
operations within a short timeframe. Leveraging proprietary fleet management and coordination
technology, we delivered the world’s largest driverless mining fleet operating with manned
vehicles, according to CIC. Our autonomous mining trucks also significantly boosted mining
efficiency to 104% of that of human-driven mining trucks
(1), as certified by the National Institute
of Metrology of China (NIM) (2) in 2022.
Our business strategy and innovative technological prowess made us a market innovator in
mass commercialization. Our initial focus on core intelligent driving functions for commercial
vehicles fortified our competitive edge. Subsequently, we expanded and tailored our offerings to
cater to more diverse and sophisticated demands, delivering unique value to customers across
sectors and forming close collaborations with strategic partners, such as leading automotive OEMs,
machinery manufacturers and energy companies. Our loyal customer base further solidifies our
technological leadership and brand influence. We served 44, 85, 131 and 152 customers as of
December 31, 2022, 2023, 2024 and June 30, 2025, respectively. As of June 30, 2025, our total
Notes:
(1) The efficiency test compared nine of our driverless mining trucks to nine human-driven trucks (with drivers
working 8-hour shifts), all operating for 16 hours daily under otherwise the same conditions.
(2) The National Institute of Metrology, affiliated with the State Administration for Market Regulation, is China’s
highest-level research institute in measurement science and the national statutory authority in the field of
metrology.
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order backlog value reached approximately RMB583.9 million. As of the same date, we delivered
304 autonomous mining trucks and 110 sets of standalone autonomous truck systems to customers,
and received indicative orders for 357 autonomous mining trucks and 290 sets of standalone
autonomous truck systems.
Our revenue increased from RMB31.1 million in 2022 to RMB410.0 million in 2024 with a
CAGR of 263.1%. Our revenue increased by 57.9% from RMB258.5 million in the six months
ended June 30, 2024 to RMB408.0 million in the six months ended June 30, 2025. Our gross profit
increased from RMB26.8 million in 2023 to RMB101.4 million in 2024. Our gross profit increased
by 57.1% from RMB44.4 million in the six months ended June 30, 2024 to RMB69.7 million in
the six months ended June 30, 2025.
The below sets forth our operating highlights:
Efficiency rate of that of manned driving
(certified by the NIM in 2022)
Out of seven national-level V2X pilot
zones covered
(1) driverless mining fleet operating with
manned vehicles;
(2) mixed-operation mining fleet
Autonomous mining trucks/
autonomous truck systems delivery
(As of June 30, 2025)
304 Units/110 Sets
> 1,000 Days
357 Units/290 Sets
Revenue growth (YoY)
2023–2024
Uninterrupted operation in mining sites
since deployment
(As of the Latest Practicable Date)
Ranked sixth among all commercial vehicle
intelligent driving companies in China
(including Hong Kong, Macau and Taiwan),
with a market share of approximately 5.2%
Five
104%
Competitive Participant in China
Market Position Remarkable Achievements
209.2%
Largest in the World
Indicative orders for autonomous mining
trucks/autonomous truck systems
(As of June 30, 2025)
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Market Overview
Market Opportunities
The rapid development of driving automation technology is reshaping global transportation,
leading mobility into a new era with enhanced safety, efficiency and comfort. According to CIC,
the markets we operate in present enormous opportunities for growth.
The market size of global commercial vehicle intelligent driving reached RMB10.0 billion in
2024 and is expected to grow significantly, reaching RMB1,614.4 billion by 2030, with a CAGR
of 133.3% from 2024 to 2030. China (including Hong Kong, Macau and Taiwan)’s commercial
vehicle intelligent driving market, which stood at RMB4.8 billion in 2024, is expected to grow
rapidly due to favorable policies and technological advancements in intelligent driving, with a
projected market size of RMB774.3 billion by 2030.
China (including Hong Kong, Macau and Taiwan)’s autonomous mining truck solution
industry is rapidly expanding, with market size reaching RMB1.9 billion in 2024, representing
approximately 75.6% of the intelligent driving market within closed environments. By 2030, the
market is expected to grow significantly to RMB39.6 billion, at a CAGR of 65.3% from 2024 to
2030. The total addressable market size
(1) of China (including Hong Kong, Macau and Taiwan)’s
autonomous mining truck solution industry in 2024 was approximately RMB550 billion.
In 2024, China (including Hong Kong, Macau and Taiwan)’s vehicle-road-cloud integrated
systems market size reached RMB2.0 billion. It is expected to grow rapidly over the next few
years and reach RMB23.8 billion by 2030, at a CAGR of 50.9% from 2024 to 2030. Such growth
is fueled by technological advancements and favorable government policies for the development of
V2X technology and construction of V2X pilot zones.
The market size of China (including Hong Kong, Macau and Taiwan)’s intelligent perception
solutions for rail transit and commercial vehicles reached RMB1.3 billion in 2024 and is projected
to grow to RMB10.2 billion by 2030, at a CAGR of 41.4% from 2024 to 2030. The potential
market size for these solutions in China (including Hong Kong, Macau and Taiwan) is also
substantial, with a total addressable market size
(2) of approximately RMB530.0 billion in 2024.
Notes:
(1) The total addressable market size includes product sales and fleet operation, calculated based on the installed base
of mining trucks and assuming the penetration rate of intelligent driving is 100%.
(2) The total addressable market is calculated based on the installed base of rail transit and commercial vehicles,
assuming the penetration rate is 100%.
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Industry Challenges
Mining and industrial vehicles face challenges of frequent accidents, harsh working
conditions, labor shortages and low production efficiency. To automate mining operations,
companies must tackle issues related to navigating complex mining environments, precise vehicle
control, fleet management, scheduling, safety and reliability, demanding strong R&D capabilities.
Road traffic faces challenges of congestion and emissions impacting the public’s quality of
life. Unregulated conflict among vehicles, pedestrians and infrastructure, along with increasing
density, causes inefficiencies and accidents due to blind spots and inadequate real-time data
exchange, contributing to traffic problems and accidents.
Rail transit faces challenges of low operational efficiency, high costs, inadequate intelligent
monitoring systems and safety. Communication systems and track-side devices for smart railways
often require mass deployment and incur high hardware costs.
Tackling Challenges through Innovation
Drawing on our expertise and industry insights, we devised a product innovation strategy that
addresses market challenges, solves evolving industry demands, rapidly iterates our technology and
targets product-market fit head on. Our innovation approach enables rapid iteration cycles,
realizing quick product turnovers that outpace competitors. Our ability to decouple complex
systems and functionality enables us to offer complex and highly useable products while enhancing
scalability. We are dedicated to discovering true latent customer requirements and capitalizing on
customer-driven opportunities, leading to high customer satisfaction, robust strategic partnerships
and consistent revenue growth.
Our innovation methodology is underpinned by a comprehensive proprietary technological
framework, including but not limited to:
 Stable, high-speed and high-precision intelligent driving technology enabling
single-vehicle intelligent driving.
 Multi-agent system algorithms facilitating convoy control of multiple autonomous
vehicles.
 V2X technology enabling information exchange between vehicles and infrastructure to
achieve beyond visual range (BVR) sensing and active sensing.
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 Mixed fleet of manned and unmanned vehicles, 5G remote control and intelligent
scheduling empowered by metaverse interfaces for enhanced efficiency and human-robot
interactions.
 Jointly developed electrification and drive-by-wire system with automotive OEMs,
advancing the safety and efficiency of autonomous vehicles.
Multi-Agent Algorithms and Systems
Simulation Computing Multi-Vehicle Global Planning
Mixed Human-Robot Fleets
Teleoperated Control
Teleoperation Station
Industrial loT
+ Dispatch System
5G
Decision
Control
Coordination
Sensor Fusion and Perception
Positioning
Deep-Learning
Simulation
Cloud
Vehicle
Road
Steering
Throttle/Accelerator
Braking
Electrification
Domain-Centralized
E/E Architecture
Suspension
Metaverse Technologies
V2X
Top-down Driverless Vehicle Development
Intelligent Driving
Our Offerings
 Autonomous Driving
o METAMINE — closed-environment autonomous mining truck solution . Our
comprehensive solution for autonomous mining, METAMINE, comprises (i) autonomous
mining trucks to enable driverless loading, haulage and unloading processes for
enhanced operational efficiency; (ii) fleet coordination module, facilitating efficient
scheduling and collaboration among vehicles; (iii) central dispatch platform, enabling
monitoring and coordination of the entire mining operation; and (iv) teleoperation
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station, enabling remote operation of excavators and other high-skill maneuvers. As of
June 30, 2025, we delivered 304 autonomous mining trucks and 110 sets of standalone
autonomous truck systems for various cases, including quarries and coal mines in
Henan, Jiangsu, Hubei, Hunan and western China, transporting over 98 million tons of
coal and ores and accumulating over 9.3 million kilometers and up to 1,000 days of
uninterrupted operation since their deployment as of the Latest Practicable Date.
Leveraging comprehensive technological prowess, our innovative METAMINE solution
harmonizes driverless and human-driven operational scenarios. By enabling humans to
interact with hazardous and challenging physical spaces in the metaverse through
gamified remote-control terminals, we create safe and engaging work opportunities,
solving labor shortage problems in the mining industry.
o Closed-environment Autonomous Logistics Truck Solution . Our autonomous logistics
truck solution is designed to enable safe, reliable, stable and efficient driverless
heavy-duty logistics in closed environments such as industrial and logistics parks. Our
solution effectively integrates (i) driverless heavy-duty logistics trucks to achieve
end-to-end intelligent driving from one loading point to another for increased efficiency
and safety; (ii) V2X system for increased safety and efficiency through real-time traffic
information exchange between roadside systems and autonomous trucks, which is
critical to add BVR sensing and active sensing capabilities to single vehicle intelligence;
(iii) central dispatch platform to streamline tasking processes while simplifying and
visualizing logistics data; and (iv) emergency takeover system to provide additional
safety redundancy.
 V2X
In line with national policies propelling the broader adoption of V2X technology and the
construction of intelligent infrastructure, we developed industry-leading V2X devices and solutions
integrating vehicles, roadside infrastructures and cloud platforms to facilitate the advancement of
intelligent transportation systems and smart cities. We successfully implemented V2X projects in
five out of seven national-level V2X pilot zones in China, supporting diverse and complex
vehicular networking scenarios. Our patented V2X + Transit Signal Priority technology has been
implemented in multiple cities and facilitated Changsha city to win the 2021 Mobility Award at the
Smart City Expo World Congress, contributing to congestion reduction, energy conservation,
emission reduction and carbon neutrality efforts.
 Intelligent Perception
o Leveraging expertise in intelligent driving technology for heavy-duty commercial
vehicles, we developed the Train Autonomous Perception System (TAPS), an active
safety system for trains to address the need for trains to possess active perception
capabilities.
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o We also provide in-vehicle intelligent perception and safety management solution for
commercial vehicles, delivering a comprehensive suite of functionalities including
360-degree adaptive surround view and environment information perception,
omnidirectional warning system and vehicle recording, among others. These functions
are realized through a single computing device, complemented by sensors and cameras
installed on the vehicle.
Our Value Propositions
 Safety . Autonomous driving and V2X technologies significantly reduce accident rates,
especially in complex and harsh mining environments.
 Efficiency . Our METAMINE solution supports 24/7 continuous operation, saving fuel costs,
releasing manpower from dangerous working environments while enhancing productivity and
efficiency. V2X products improve road intelligence and transportation efficiency.
 Comfort . Our teleoperation station is connected with an immersive cloud platform and offers
a comfortable and intelligent operating experience, especially attracting young workers.
 ESG. Our intelligent driving solutions prioritize safety, environmental protection and low
carbon emissions, contributing to sustainable development. Our autonomous electric mining
trucks excel in productivity, safety and cost-effectiveness compared to traditional
human-driven fuel trucks. Our V2X products reduce accidents and congestion, optimize
traffic flow, and enable a more economically efficient and lower carbon emission
transportation system.
OUR STRENGTHS
Innovative Product-driven Provider of Autonomous Commercial Vehicle Technology
We are an innovative product-driven provider of intelligent driving products and solutions for
commercial vehicles in China. We focus on the research and development of closed-environment
autonomous driving trucks for mining and logistics, V2X (vehicle-to-everything) technologies and
intelligent perception solutions, and offer products and solutions underpinned by proprietary
technologies, with a primary focus on intelligent driving in closed environments during the Track
Record Period.
According to CIC:
 We ranked sixth among all commercial vehicle intelligent driving companies in China
(including Hong Kong, Macau and Taiwan), with a market share of approximately 5.2%.
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 We delivered 56 autonomous mining trucks for a mining site in China (including Hong
Kong, Macau and Taiwan) in mixed traffic with ~500 manned trucks, the world’s largest
mixed-operation mining fleet
(1) as of the Latest Practicable Date.
 We delivered the first fully driverless electric mining fleet in China (including Hong
Kong, Macau and Taiwan).
 We ranked third in China (including Hong Kong, Macau and Taiwan)’s autonomous
mining truck solution market in terms of revenue in 2024.
 We are among the first intelligent driving companies in China (including Hong Kong,
Macau and Taiwan) to launch commercial V2X products.
 Our train autonomous perception system (TAPS) is the only product in China (including
Hong Kong, Macau and Taiwan) capable of independent safety perception (2) for trains.
Our market position is the result of our relentless efforts in identifying latent customer needs
and pain points and leveraging our technological capabilities to develop high-value products for
the optimal product-market fit. This enabled us to adopt a pure product sales model, distinguishing
us from most competitors who also engage in fleet operations. However, under our product sales
model, we may also be required to provide various financial assistance (e.g., offering guarantees
for financial leases, granting extended payment terms) to obtain orders from customers. During the
Track Record Period, we provided a guarantee of RMB2.0 million for Customer Y and Customer
Z, a guarantee of RMB70.0 million for the debt owed by Customer K, loans of RMB13.1 million
and a deposit of RMB15.2 million for Customer K. We also granted 24-month credit terms and
monthly installment payment arrangements to Customer M and Customer P. Our strong market
power and validated product performance, reliability and user-friendliness allow us to deliver
products on a one-off basis to customers without the need to provide ongoing operational services.
We translated our industry-leading technology into commercial success within a short period of
time. For example, we began mass production of our autonomous mining trucks in 2022, and
delivered 304 autonomous mining trucks and 110 sets of standalone autonomous truck systems to
customers as of June 30, 2025. Our position in the industry enable us to achieve commercialization
ahead of competitors, strengthen competitive edges and build a loyal customer base and position
us to swiftly capture future growth opportunities and rapidly expand our business.
Notes:
(1) “Autonomous mining trucks” refers to autonomous driving trucks designed for mining operations.
“Mixed-operation” refers to scenarios involving both manned and unmanned mining trucks.
(2) Without relying on existing railway signaling systems or additional track-side devices.
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Pioneering R&D and Comprehensive Technological Prowess
Our R&D team’s expertise spans across AI, computer science, robotics and vehicle
engineering, among others, enabling interdisciplinary development and application. As of June 30,
2025, we had a total of 249 R&D personnel, constituting 54.1% of our workforce. We strategically
deployed R&D teams in Changsha, Chongqing and Chengdu to collaborate closely with customers
in different regions while also attracting top talents across various regions. We also engage in
collaborative R&D projects with renowned institutions around the world, such as the King
Abdulaziz City for Science and Technology (KACST) in Saudi Arabia to enhance our R&D and
commercialization capabilities and drive industry advancements.
Leveraging comprehensive technological prowess, we developed proprietary algorithms,
software, subsystems and modules encompassing all aspects of intelligent driving, enabling us to
develop industry-leading products and solutions to boost driverless mining efficiency to 104% of
that of human-driven mining trucks certified by the NIM. This was made possible by our
state-of-the-art autonomous vehicle planning and control system enabling high-precision and
adaptive trajectory planning and decision-making in complex and constantly changing
environments; dust, fog and vibration-proof vehicle perception system ensuring reliable
performance even in harsh conditions while enabling automated 3D driving space construction and
real-time updates without human intervention; and advanced multi-agent decision and optimization
algorithms and systems for coordinating, scheduling and dispatching heavy-duty vehicle fleets that
maximizes operational efficiency, preemptively resolves traffic conflicts and enables collaboration
with human-driven vehicles. These systems are repeatedly tested, validated and iterated through
our extensive simulation platform to maximize performance and efficiency, while significantly
reducing on-site testing needs. Moreover, our ability to embed proprietary algorithms into
high-performance computing devices and novel components such as LiDAR on autonomous
vehicles enables timely adaptation and upgrades as well as the development of proprietary
software-defined functionalities.
As a testament to our R&D capabilities, we had an extensive intellectual property portfolio
with 513 patent applications and 362 registered patents in the PRC, consisting of 170 invention
patents, 107 utility patents and 85 design patents as of the Latest Practicable Date. As of the same
date, we participated in the formulation of over 50 industry standards, including contributing to the
T/CSAE 53-2017 standard for intelligent transportation and vehicular communication and leading
the drafting of C-ITS group standards for implementing cooperative public transit systems. Our
strong, replicable R&D methodologies enhance R&D efficiency and accelerate the path to
commercialization. Our R&D processes prioritize automotive safety, with more than 10
automotive-grade quality and safety management system certifications.
Proven Commercial Success in Domestic Markets with Global Outlook
Establishing a solid foothold in the Chinese market while keeping our sights set on global
expansion, we led a series of flagship projects domestically and effectively extended our domestic
success to overseas markets, marking a significant step in our global outreach.
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We successfully rolled out a series of benchmark projects across China, earning the trust of
strategic partners. For autonomous mining, we delivered the first fully driverless electric mining
fleet in China for TCC in Jurong, Jiangsu, which is also the first nationwide autonomous mining
project certified by the NIM to exceed the efficiency of manual mining operations; our project in
Northwest China represents China (including Hong Kong, Macau and Taiwan)’s largest mixed fleet
of manned and unmanned mining vehicles; our autonomous mining project in Zhengzhou, Henan
represents China (including Hong Kong, Macau and Taiwan)’s first fully driverless quarry with
excavator collaboration, according to CIC. For V2X, since the initial commercialization of our
in-house developed V2X devices in 2018, we consistently achieved groundbreaking endeavors
including launching the innovative V2X + Active Transit Signal Priority system and playing a key
role in establishing one of the largest national-level V2X pilot zones for Liangjiang New Area,
Chongqing, according to CIC. For intelligent perception, we were one of the first in the industry to
deliver mass-produced, factory-installed autonomous perception system for trains, according to
CIC.
Our revenue increased from RMB31.1 million in 2022 to RMB410.0 million in 2024 with a
CAGR of 263.1%. Our revenue increased by 57.9% from RMB258.5 million in the six months
ended June 30, 2024 to RMB408.0 million in the six months ended June 30, 2025. We served 44,
85, 131 and 152 customers as of December 31, 2022, 2023, 2024 and June 30, 2025, respectively.
As of June 30, 2025, our total order backlog value reached approximately RMB583.9 million. As
of the same date, we delivered 304 autonomous mining trucks and 110 sets of standalone
autonomous truck systems to customers, and received indicative orders for 357 autonomous mining
trucks and 290 sets of standalone autonomous truck systems.
Our products and solutions are designed for standardized deployment, enabling us to replicate
R&D results and reduce development costs. Drawing on the experience gained from landmark
projects in China, we replicated our proven business models overseas, forging strong customer
relationships and establishing a solid foothold in various overseas regions. This led to the signing
of multiple overseas projects, with indicative order value reaching RMB64.8 million as of June 30,
2025. Key projects include partnership with a Mongolian corporation for a green mining pilot
project utilizing our new energy autonomous mining trucks; a zero-waste initiative in Ha’il, Saudi
Arabia utilizing our V2X products and solutions to upgrade the city’s intelligent sanitation
heavy-duty trucks for intelligent operation and management of the full lifecycle of waste
processing; and an intelligent driving project for transportation in complex cave environment
without GNSS signal in Shatin, Hong Kong, among others.
Evolving Ecosystem Built with Trusted Partners along Industry Value Chain
Through close collaboration with partners along the entire industry value chain, we
collectively built a mutually empowering and evolving product ecosystem. We strategically
positioned ourselves within the industry chain to leverage the expertise and insights of our partners
and facilitate knowledge exchange and innovation in the industry. We fostered synergistic
partnerships with leading automotive OEMs to deliver factory-installed intelligent driving vehicles
to customers, combining the OEMs’ mass production capabilities and technical experience in
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diverse vehicle types with our expertise in intelligent driving technology. This enables seamless
and optimal integration of our intelligent driving algorithms, software and subsystems with the
vehicles and fosters long-lasting relationships that mutually empower and drive our innovation and
commercialization.
We engage closely with downstream players to foster customer loyalty and uncover latent
customer needs, with an aim to continually optimize product-market fit. By incorporating customer
feedback into our product development processes, we make timely and informed decisions based
on first-hand user experience. Catering to specialized sectors such as mining and rail transit, we
invest substantially in observing customer operations and environmental conditions as well as
understanding their needs and risks. This enables us to deliver high-value products that seamlessly
integrate with customers’ operational flow and drive user satisfaction. This customer-centric
process reinforces our products’ value and solidifies long-term customer relationships, enabling us
to build a loyal customer base.
Our clientele is highly diverse, which enriched our experience across different application
scenarios and vehicle types, allowing us to expedite the implementation of new projects and
quickly grow our business. Additionally, our extensive partner network and loyal customer base
also enable us to leverage cross-selling opportunities and word-of-mouth marketing by satisfied
customers, positioning us for rapid growth without significant investments in sales and marketing.
Our key ecosystem partners include prominent companies across various sectors, such as
Sinotruk and Dongfeng Liuzhou Motor from the automotive industry; Sany Heavy Industry,
Lingong Heavy Machinery and Shaanxi Tonly Heavy Industries from the machinery industry; TCC
from the construction industry; and NavInfo from the V2X industry.
Esteemed Management Fostering Homegrown Talent Pool with Product-Oriented Culture
We are led by a team with expertise in the international automation industry and developed a
unique training culture designed to cultivate engineers focused on creating application value for
customers and driving our continued growth.
Our founder and chairman, Prof. Li, is an internationally renowned research scientist in AI,
robotics and automation and a recipient of the 2019 IEEE Robotics and Automation Award. He is a
serial academic entrepreneur dedicated to incubating talent and has co-founded some of China’s
most prominent tech companies. He also served as a research scientist in the AI Laboratory of MIT
and was the originator of nonholonomic motion planning, a critical field in robotics. Combining
academic and entrepreneurial expertise, Prof. Li leads our talent training and cultivation efforts
with a product-oriented culture.
Our co-founder, vice chairman and chief architect, Dr. Ma, is a Silicon Valley veteran with
over 30 years of expertise in robotics, signal processing and automotive industries. He previously
held key research positions at National Semiconductor Inc and Texas Instrument Inc in the United
States, specializing in intelligent driving applications. Our executive Director and chief executive
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officer, Dr. Hu, is our homegrown talent who joined us in 2018 with a Ph.D. from the University
of California, Berkeley. With educational and professional expertise in both technological research
and business management, Dr. Hu spent the last seven years in key engineering roles at our
Company, including principal scientist, head of the control systems team and research director of
CiDiLabs. Dr. Hu also serves as graduate advisors at first-class institutions in China, which in turn
facilitates our talent acquisition efforts.
Our core team, formed under the guidance of our founding team and training culture, come
from esteemed institutions such as the University of California, Berkeley, the University of
Michigan Ann Arbor and the Hong Kong University of Science and Technology, among others, and
has an average of more than 15 years of industry experience, many of whom have been with our
Company since the start. Under the leadership of Prof. Li, we developed a unique and effective
training culture to systematically cultivate engineers specialized in intelligent driving and
intelligent hardware. Promoting the “New Engineering Education Transformation” philosophy, we
identify and nurture young engineers with innovative spirits and cross-disciplinary expertise,
fostering a culture of product-oriented innovation and practical problem-solving aimed at
delivering unique value to customers.
OUR STRATEGIES
We aim to embrace a better life with intelligent driving by revolutionizing work safety,
efficiency and comfort through continuous innovation in this technology. To achieve our
objectives, we formulated the following key strategies:
Continually Invest in Intelligent Driving Technology and Enhance Product Competitiveness
We plan to continually iterate our autonomous commercial vehicle products and technologies,
specifically:
 Identify high value applications and build an innovative product matrix resilient against
market uncertainties.
 Enhance algorithm precision, robustness and adaptability to resolve corner cases through
more refined extreme scenario data analysis.
 Integrate software, hardware and algorithms to further optimize autonomous operations
for customers, such as combining intelligent fleet scheduling with digitalized industrial
management to achieve fully intelligent driving in mining sites.
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 Diversify the application scenarios of our intelligent driving technology across various
commercial vehicle driving scenarios, including autonomous heavy-duty trucks for
container or cargo transportation in ports, autonomous heavy-duty trucks for steel plates
transportation in steel plants, autonomous heavy-duty trucks operating within chemical
industrial parks, as well as in railway freight stations, underground mines, and airport
logistics.
 Collaborate with leading OEMs to standardize hardware installation and deployment for
intelligent driving systems.
We plan to further upgrade, optimize and expand deployment of our software, hardware and
algorithms, while increasing their cost-effectiveness, specifically:
 Enhance performance of sensor suite, including LiDAR, vision sensors and mmWave
radar, to improve stability, safety and calibration accuracy.
 Optimize intelligent processing units, V2X roadside units, V2X onboard units and edge
computing units to offer competitive domestic V2X solutions.
 Enhance intelligent scheduling systems for autonomous mining trucks, remote control
systems, intelligent perception solutions for rail transit, V2X cloud control platform and
intelligent transportation systems by optimizing software functionality and user
experience.
Expand Sales and Form Lasting Strategic Partnerships
We plan to expand our sales through the following measures: (i) enhance the size and
expertise of our sales team with structured talent development to enhance rapid customer response,
demand identification, and customer acquisition, including cultivating sales team leaders with
regional management expertise, presales experts to continuously evaluate customer demand and
technical experts to assess project feasibility and product delivery experts to ensure customer
demands are met; (ii) develop a more diverse range of marketing tools and channels to increase
our market presence; and (iii) establish a reliable and efficient distribution system to reach a
broader customer base. By leveraging our leading technological advantages, we aim to address
specific pain points of our customers, improving the efficiency and safety of their operations. We
expect our rapidly scalable delivery capabilities to reduce unit costs, thereby increasing our
competitiveness in the market, boosting market share and building strong brand value through
consistent and high-quality service.
We plan to strengthen existing customer relationships through the following:
 Expand the integration of our products onto additional vehicle models of existing
customers.
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 Enhance the single-vehicle commercial value with existing customers. For example, we
aim to transition from offering single sensors or software algorithms to intelligent
driving systems and expanding from intelligent driving solutions to provide a broader
range of V2X products.
We plan to collaborate closely with our customers in various aspects to form lasting
partnerships. We plan to employ a key account sales management approach, focusing on the
development and definition of customer needs. Through deep customization and collaboration with
automotive OEMs, integration with their sales systems and leveraging the sales support of our
partners, we strive to establish stable supply chain and a comprehensive after-sales service system.
By actively engaging with our OEM customers in the formulation of industry standards, we aim to
enhance our industry influence while gaining a deeper understanding of customer needs. The joint
efforts with OEM customers in the R&D, validation and sales of vehicle products facilitate us to
seamlessly integrate our intelligent driving technology and systems with their traditional vehicle
chassis, creating a new brand of intelligent commercial vehicles. As of the Latest Practicable Date,
we were developing CiDiTruck under our own brand with a leading Chinese automotive OEM.
Furthermore, we are dedicated to developing comprehensive solutions and intelligent management
systems that align with customers’ operational habits. Through continual technological updates and
iterations, we strive to enhance customers’ operational and production efficiency and improve the
overall working environment at operation sites, achieving long-term mutual benefits with our
customers.
We plan to further broaden our customer base to supply intelligent driving systems for
mass-produced vehicles of more customers, offer V2X solutions to a wider range of intelligent
transportation systems and provide intelligent perception solutions for more rail transit
applications.
Expand Overseas Presence and Market Share
We plan to evaluate resources, costs and policies before entering overseas markets to
capitalize on the significant growth potential in the commercial vehicle intelligent driving industry.
One of our key initiatives is driving the overseas commercialization of autonomous mining trucks
to Australia, Europe and South America. According to CIC, as the world’s largest country in iron
ore reserves, Australia’s iron ore reserves are estimated to reach nearly 58 billion tons in 2023,
accounting for approximately 30% of the global total. Meanwhile, Europe and South America also
rank among the leading global suppliers of essential resources like coal, copper, and lithium,
presenting significant opportunities for the deployment of METAMINE solution.
During the Track Record Period, we did not derive revenue from any overseas customers
outside Mainland China. We are actively engaged in building relationships with overseas partners
and have established initial collaboration with multiple overseas customers to commence projects.
Through collaborations with Saudi Arabia’s NEOM new city and other similar projects, we aim to
gradually extend our overseas presence through the launch of CiDiTruck, our flagship product
designed to elevate user experiences to the maximum, catering to legitimate societal needs. In
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open roadways and complex environments, CiDiTruck serves as an intelligent driving solution for
professional operators, minimizing risks of accidents. In more contained settings, it transitions into
an autonomous vehicle, serving service operators by enhancing operational efficiency and reducing
accident rates.
Leveraging experience from our overseas expansion endeavors, we are well-equipped to
venture further into international markets, strategically positioning ourselves to meet the global
demand for autonomous mining trucks.
Attract and Retain Top Talent Globally
We are dedicated to further attracting renowned R&D experts worldwide to bolster our
capabilities in software and algorithm development. We also plan to expand and reinforce our sales
and marketing teams to better seize global market opportunities.
We developed a unique and effective training culture to systematically cultivate engineers
specialized in intelligent driving and intelligent hardware. Through this system, we aim to provide
long-term nurturing and empowerment to exceptional talents within our organization and identify
young engineers with innovative spirits and cross-disciplinary expertise, fostering a culture of
product-oriented innovation and practical problem-solving aimed at creating unique value for
customers.
Selectively Engage in Investments, Mergers and Strategic Partnerships
We plan to further consolidate resources along the upstream and downstream industry chain
through strategic investments or mergers and acquisitions. Potential targets include suppliers with
strong research and delivery capabilities in intelligent driving software, hardware systems and key
components, as well as end customers and operators with significant competitive advantages in the
intelligent driving industry. We believe such strategic investments or mergers and acquisitions will
enable us to extend our reach upstream and downstream, effectively integrate business resources,
ensure supply chain stability and better cater to the demands of downstream application scenarios.
We have not identified or entered into any letter of intention to acquire any potential target.
OUR OFFERINGS
We are an innovative product-driven provider of intelligent driving products and solutions for
commercial vehicles in China. We focus on the research and development of closed-environment
autonomous driving trucks for mining and logistics, V2X (vehicle-to-everything) technologies and
intelligent perception solutions, and offer products and solutions underpinned by proprietary
technologies, with a primary focus on intelligent driving in closed environments during the Track
Record Period. Our autonomous driving trucks are generally designed with a typical product life
cycle of approximately five years.
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The below table sets forth our major products and solutions:
Category Products and solutions
Revenue contribution in the
six months ended June 30, 2025
Amount (RMB in thousands) %
Autonomous
driving
 METAMINE solution
 Closed-environment autonomous
logistics truck solution
378,364 92.7
V2X  V2X products and solutions 9,179 2.3
Intelligent
perception
 Train autonomous perception
system (TAPS)
 In-vehicle intelligent perception
and safety management solution
20,493 5.0
Autonomous Driving
Our autonomous driving solutions include (i) METAMINE solution and (ii)
closed-environment autonomous logistics truck solution. Our revenue from autonomous driving
increased from RMB28.0 million in 2022 to RMB254.9 million in 2024. Our revenue from
autonomous driving solutions significantly increased from RMB156.0 million in the six months
ended June 30, 2024 to RMB378.4 million in the six months ended June 30, 2025.
METAMINE — Closed-environment Autonomous Mining Truck Solution
Our closed-environment autonomous mining truck solution, METAMINE, enables
autonomous haulage and logistics and remote controlled excavation in mining sites and aims to
enable the remote operation of other mining processes such as drilling and blasting in the future.
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Our METAMINE solution comprises (i) driverless mining trucks equipped with our
proprietary autonomous truck system, realizing driverless loading, haulage and unloading
processes for enhanced operational efficiency; (ii) fleet coordination module, managing loading,
haulage and unloading processes in the mining area and facilitating efficient scheduling and
collaboration among vehicles; (iii) central dispatch platform, enabling monitoring and coordination
of the entire mining operation; and (iv) teleoperation station, enabling remote operation of
excavators and other high-skill maneuvers.
Coordination with
excavators modified with our
remote operation and V2V
communication technology
Autonomous Mining Trucks
We collaborate closely with automotive OEMs to design autonomous mining trucks equipped
with advanced intelligent driving technology designed to address the challenges of complex mining
environments and heavy haul operations.
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Forward vision sensors
Identify and classify targets accurately,
recognizing pedestrians, vehicles,
traffic cones, among others
Forward LiDAR
3D laser point cloud can measure
distance and identify obstacles
with high precision
5G communication module
Faster data transmission speeds,
low latency, high reliability,
waterproof and dustproof
Blind spot LiDAR
90° × 360° hemispherical field of view,
covering blind spots around
the vehicle
Tire pressure
monitoring system
( TPMS )
GPS/GNSS Multi-sensor
fusion positioning system
High-precision positioning with
centimeter-level accuracy, ensuring
stable intelligent driving in most
outdoor scenarios; indoor navigation
provided by sensor fusion
Charging efficiency
≤ 1h Dual-gun Fast Charging
(SOC 25% ~ 95%)
Capacity
60t-100t
OBU V2V communication
C-V2X-based communication system
sends and receives positioning,
heading, speed, altitude and driving
intention to other vehicles and
equipment, responding promptly to
ensure vehicle safety
Lateral vison sensors
Accurately detect side obstacles
as vehicles and pedestrians. Precisely
sense road boundaries to ensure
safe lane changes and driving
on narrow roads. Effectively monitor
the approach of objects from the side,
enhancing situational awareness and
ensuring safer driving
Forward view
millimeter-wave radar
Acquisition of information including
relative distances, speeds, angles,
and directions of surrounding objects;
rapidly detect objects at long
distances and operate in all-weather
and lighting conditions
We jointly developed different types of autonomous mining vehicles with automotive OEMs,
primarily including the below:
Suitable for Heavy Loaded Downhill Scenarios
Pure Electric Drive Range-Extended Drive
Suitable for Heavy Loaded Uphill Scenarios
Cement, Sand and Gravel,
Aggregate Mines, etc.
Regenerative braking for heavy loaded downhill, green
and energy-saving
Coal Mines, Copper Mines,
Iron Mines, etc.
High-torque electric motor provides sufficient power
for heavy loaded uphill
We offer both pure electric and extended-range hybrid mining vehicles, with a product life
cycle of five years and estimated battery life of up to five years or 200 thousand kilometers,
whichever occurs first.
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We categorize the key functionalities of our autonomous mining trucks into three groups,
namely: (i) perception and positioning, (ii) decision, coordination and control, and (iii) diagnostics
and redundancy:
 Perception and Positioning
o Sensor fusion and processing: Combining sensor fusion, BEV perception and deep
learning technologies, integrates heterogeneous automotive-grade sensors including
mmWave radar, automotive-grade LiDAR and vision systems to enable 360-degree
perception around the vehicle body with zero blind spots and reliable detection and
differentiation of pedestrians, different types of vehicles, rocks and obstacles
within a 100-meter range. Our fine-grained object detection model is trained with
real mining data with strong generalization capabilities, requiring minimal
fine-tuning for complex conditions. It is able to detect obstacles as small as
10*10cm from 40 meters away, outperforming industry standards, where most
competitors typically achieve detection range of 30*30cm objects from 30 meters
away, according to CIC.
o Enhancement filtering: Employs intelligent noise filtering algorithms to precisely
filter out dust, rain, snow and fog and utilizes motion compensation technology to
minimize interference from vehicle vibrations. The system evaluates sensor noise
in real time and dynamically adjusts the fusion strategy to ensure safe intelligent
driving 24/7 in all lighting and weather conditions, such as extreme brightness or
darkness, sandstorms (impacting visibility) and heavy snow (impacting positioning
capabilities).
o V2V (V ehicle-to-V ehicle) cooperative perception and active sensing: Integrates
On-Board Units (OBUs) installed on mining trucks and C-V2X software with a
communication range of up to 800 meters and a latency of less than 30ms,
ensuring real-time data exchange and active sensing against fog and rainy
conditions. This technology enables real-time acquisition of the precise location
and perception information of other vehicles, enhancing BVR perception
capabilities and improving safety redundancy, thereby enhancing the overall
decision-making and planning process, and in turn improving operational
efficiency.
 Decision, Coordination and Control
o Intelligent obstacle avoidance: Determines whether to runover, evade, or navigate
around obstacles based on their characteristics.
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o High-speed navigation: Enables autonomous navigation at speeds up to around
40km/h, even in mixed operation scenarios, the highest in the industry, according
to CIC.
o Collaboration between driverless and human-driven vehicles: Utilizes our
proprietary mixed operation technology to enable collaboration between
human-driven and driverless vehicles in mining operations. Our driverless mining
trucks can operate seamlessly with human-driven vehicles that are not equipped
with any intelligent devices, facilitating mixed traffic flow on transport routes and
complex scenarios such as intersections and lane changes. This eliminates the need
to designate a separate operating area for the driverless trucks or modify any
human-driven vehicles, significantly reducing adoption costs for mine operators in
terms of both environmental modification and initial commitment. Such mixed
operation differs significantly from purely driverless vehicle operations,
necessitating additional functionalities such as recognition of human-driven
vehicles without any intelligent devices or trajectory prediction, as well as smart
evasion and overtaking.
o Adaptive parking: Achieves precise parking based on vehicle perception and
boundary information, adapting to constantly changing site conditions, with lateral
parking accuracy <15cm and longitudinal parking accuracy <20cm.
 Diagnostics and Redundancy
o Fault diagnosis system: Performs over 100 self-diagnostics per second for more
than 1,600 fault detection items.
Fleet Coordination Module
Our proprietary fleet coordination module aims to optimize mining activities through
facilitating efficient scheduling and coordination among vehicles. It consists of (i) algorithms for
multi-vehicle global path planning, optimized efficiency scheduling and mix-traffic flow
facilitation; and (ii) software for distributed fleet management across multiple locations and
simulation. The system enables the following key functions:
 Intelligent scheduling of loading and unloading: Utilizes deep learning and
optimization algorithms to compute optimal vehicle destinations for loading/unloading,
enhancing overall production efficiency by 13%.
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 Multi-vehicle planning and coordination: Enables: (i) orderly and obstacle-free
queuing for autonomous vehicle fleet; (ii) intelligent route selection adapting to complex
mining conditions such as extremely narrow, steep or rocky road conditions; and (iii)
preemptive traffic jam avoidance and deadlock prevention and resolution, reducing fleet
total travel time by 15%; supports deployment of over 1,000 vehicles; and reduces the
need for extensive real-world testing in the mines by testing complex traffic scenarios
using our proprietary AI simulation platform, speeding up project timelines.
 Prediction of human-driven vehicle behavior and trajectory: Facilitates mixed traffic
flow of driverless and human-driven vehicles. Leveraging multi-vehicle sensor fusion
and neural networks, achieving prediction accuracy of over 95%, outperforming industry
average of approximately 90%, according to CIC.
 Charging optimization: Opting for vehicle recharging during periods of low electricity
prices and optimizing charging times enhances vehicle utilization by over 10% and
reduces charging costs by over 20%.
 Dispatch optimization: Optimizes vehicle dispatch to maximize efficiency and allocates
vehicles, excavators and other equipment and resources for optimal coordination and
increased operational efficiency.
Central Dispatch Platform
The central dispatch platform aims to monitor the entire mining operation and collect data for
statistical analysis. It features the below key functions:
 Intelligent Scheduling: Automatically schedules and dispatches mining trucks for
loading and unloading operations based on real-time workload assessments to optimize
vehicle allocation, reducing vehicle queueing time and idle time at loading or unloading
points, thereby boosting fleet productivity.
 Equipment Monitoring and Management: Enables real-time monitoring and tracking of
the positions, queuing and task completion statuses or any malfunctioning of mining
trucks, drill rigs, excavators, crushing stations and other equipment in the mine. Allows
remote access to vehicle cameras for monitoring of the surroundings to facilitate
efficient mine management. Supports concurrent monitoring of over 1,000 devices.
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 Statistical Analysis: Automatically calculates and records production volume,
fuel/electric consumption and maintenance logs, and analyzes the efficiency of vehicle
dispatch, refueling, maintenance and production using big data technology to facilitate
cost reduction, efficiency improvement and management enhancement in mining
operations.
While our fleet coordination module specializes in the precise management of mining
vehicles, intelligently scheduling tasks such as loading, haulage and refueling to optimize
efficiency and energy consumption while ensuring fleet safety, our central dispatch platform offers
a comprehensive platform for managing the entirety of mining operations, from production
planning and equipment monitoring to safety alerts, data analysis and maintenance activities,
aiming to digitize and streamline the entire mining operation efficiently and intelligently. Our fleet
coordination module is a subsystem of our central dispatch platform, and is offered to customers as
a standalone function of the central dispatch platform or together with other subsystems of our
central dispatch platform.
Teleoperation Station
Our teleoperation station is a supplementary tool that enables remote operation for excavation
and other high-skill maneuvers such as drilling and blasting. Consisting of teleoperation station
hardware, 5G connectivity modules and remote control software including control algorithms and
perception suite with user-friendly interfaces that enhance the overall experience for operators,
enabling highly immersive remote operation of excavators and cranes to complete intricate and
high-risk tasks such as excavation, drilling, blasting and other operations, greatly improving the
safety of operators and the working environment. It also enables remote operation of vehicles in
corner cases where intelligent driving may not be suitable. Connected with an immersive cloud
platform, it offers a comfortable and intelligent driving experience, creating appealing job
opportunities which especially attract young workers.
Our teleoperation station can control operations more than 1,000 km away, continuously and
reliably operate for over 120 hours and features a lightweight and compact design (< two square
meters; ≤120kg).
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The key functionalities of our teleoperation station are summarized below:
 Ultra-low latency remote control over long distances (emergency stop command latency
≤20ms; signal latency ≤20ms; image latency ≤160ms) and comprehensive network
compatibility.
 Multi-vehicle control from a single station.
 Two-way voice communication.
 Live visual, audio and sensor-assisted feedback.
 Comprehensive safety measures including lane departure warning, vehicle collision
avoidance system and 360° coverage with zero blind spots.
 Serves as an emergency takeover system for driverless vehicles during rare occurrences
of emergency system failures. The rate of such emergency takeover during the operation
of our driverless vehicles was approximately 0.07% in the six months ended June 30,
2025.
 Modular design enabling flexible customization for different scenarios and vehicles.
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Use Cases
Autonomous Mining Project in Jurong, Jiangsu for TCC
In March 2022, we delivered 14 driverless electric mining trucks for an intelligent mining
project in Jurong, Jiangsu. This project enabled the mine operator, TCC, to perform autonomous
loading, haulage, unloading and recharging operations without the need for safety personnel
running 24/7. it marked a significant milestone as China (including Hong Kong, Macau and
Taiwan)’s first autonomous electric mining project with full mining area coverage, with the
following achievements:
 certified by NIM to surpass the efficiency of manual mining operations.
 Annual reduction of over 1,800 tons of carbon emissions.
 Cost reduction of RMB1.75 per ton compared to fuel vehicles.
Large Coal Mine in Northwest China
In December 2023, we delivered 56 driverless mining trucks to the mine operator of a large
coal mine in northwest China. The coal mine was located at an altitude of 2,600 meters. The
driverless truck loading area was located at altitudes ranging from 2,310 to 2,460 meters, with
unfixed and constantly changing mining areas, requiring a mixed fleet of manned and unmanned
mining trucks with high safety and functionality standards. According to CIC, this project set the
record for (i) the world’s largest driverless mining fleet operating with manned vehicles, and (ii)
the world’s largest mixed-operation mining fleet, as of the Latest Practicable Date.
Integrated with an intelligent planning system, remote driving system, high-precision
positioning system and intelligent excavator terminal, our driverless mining trucks enabled the
safe, low-carbon and productive autonomous operation. We addressed the following technical
challenges in the project:
 In response to the operation suspension caused by temporary network outages, we
upgraded the hybrid positioning system and optimized the algorithms to enable the
driverless trucks’ continued operation without network connection.
 In response to the safety hazards and traffic congestions caused by the merging and
diverging of driverless vehicles at the intersections, we developed a route prediction
function that facilitated driverless trucks to detect other vehicles’ location and speed
information and predict other vehicles’ intended routes.
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Closed-environment Autonomous Logistics Truck Solution
Our closed-environment autonomous logistics truck solution is designed to enable safe,
reliable, stable and efficient driverless heavy-duty logistics in closed environments such as
factories and logistics parks. It aims to promote the development of autonomous logistics and
accelerate the formation of “new quality productive forces” in the logistics industry.
Our closed-environment autonomous logistics truck solution offers similar fundamental
functionalities to our METAMINE solution such as autonomous vehicle control and
decision-making as well as coordination and planning, while adapting to specific demands of
logistics scenarios such as cargo handling requirements, navigating challenging conditions of
industrial parks and adapting to mixed traffic scenarios with pedestrians and other vehicles. The
solution effectively integrates (i) autonomous heavy-duty logistic trucks, enabling end-to-end
autonomous driving from one loading point (e.g. cargo platform) to another within the enclosed
operating area, precise parking and docking at loading points and automated coordination with
existing third-party AGVs (automated guided vehicles) and other equipment at the industrial park
to realize unmanned loading and unloading; (ii) central dispatch platform, streamlining tasking
processes while simplifying and visualizing the logistic data; and (iii) emergency takeover system,
acting as a contingency system for emergency intervention to provide even more safety
redundancy.
Transportation Route
(onsite private road / public road)
Unmanned truck
5G
5G
5G
V2X system
V2X system
Management center
Management app Cloud management platform Teleoperation station
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Application Scenarios
Our closed-environment autonomous logistics truck solution is designed to address pain
points and challenges of various application scenarios, such as the below:
 Chemical industrial parks. Chemical industrial parks typically involve the transportation
of heavy metal products, hazardous liquids, raw materials and energy materials, while
the working environment is often filled with potentially explosive dust, high heat and
radiation. Our autonomous trucks can liberate human drivers from these harsh
conditions by offering specialized handling capabilities to address the unique challenges
of transporting heavy loads and navigating dangerous conditions. Moreover, our solution
can operate even when satellite and 5G network is restricted.
 Logistics and manufacturing hubs. Our solution can significantly improve operational
efficiency. The typical transportation routes of logistics and manufacturing hubs include
transfers of goods between different warehouses in a closed environment, where other
vehicles and pedestrians may be present. Our solution enables reliable and full-process
automation, including precise docking, while recognizing complex traffic scenarios such
as mixed traffic and pedestrians jaywalking to ensure safety.
Autonomous heavy-duty logistics truck
During the Track Record Period, we provided intelligent driving systems for heavy-duty
logistics trucks to customers comprising intelligent driving hardware and software that enable
logistics trucks to reliably carry out driverless heavy-duty logistics tasks in industrial plants,
manufacturing hubs and logistic parks. We are also partnering closely with industry-leading OEMs
to develop high-quality, driverless, efficient logistics trucks equipped with our intelligent driving
systems for different working conditions, including tractor-trailer trucks, box trucks and dump
trucks and have secured customer orders for our trucks.
These driverless heavy-duty logistics trucks integrate a series of advanced AI technologies,
featuring all-scenario positioning, all-weather and condition fusion perception, comprehensive
intelligent planning, high-precision control and V2V communication. We aim to facilitate safe,
reliable and efficient heavy-duty logistics operations in any closed industrial scenarios.
 All-weather and condition fusion perception: We leverage BEV fusion network to
accurately understand the surrounding environment for real-time, 360-degree surround
perception that accurately detects the drivable area and various obstacles, while
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maintaining an effective perception range exceeding 1,000 meters. Our algorithms
operate reliably in adverse weather conditions and are vibration-proof to ensure all-time
effectiveness of our trucks.
 Comprehensive intelligent planning: We integrate AI and expert systems to
dynamically plan vehicle trajectories based on real-time environmental assessments,
enabling adaptive handling of complex environments of the industrial parks, where the
driverless logistics task completion efficiency exceeds 99% of that of human-driven
operations in certain conditions. In addition, the truck is able to recognize
metropolis-like complex traffic scenarios including mixed traffic and pedestrian
jaywalking for accident prevention.
 High-precision control: We utilize proprietary technology combining dedicated neural
network and optimal control techniques to precisely manage vehicle dynamics and
motion states, ensuring accurate truck movement even during challenging maneuvers
such as platform docking, under-crane parking and tunnel or narrow road navigation,
achieving driverless parking and docking accuracy of under 5cm. Our vehicle control
technology also enables coordination with existing third party AGVs and cranes to
realize efficient cargo loading and unloading, and automated customs inspections.
 V2X system: We integrate V2X technology with our autonomous trucks. Although V2X
systems are not indispensable for autonomous logistics trucks, they significantly
improve reliability and enhance the intelligence and safety of our autonomous logistics
trucks. For example, we deploy V2V technology to every driverless truck, allowing
them to take coordinated driving actions at locations prone to traffic congestion, thereby
improving overall efficiency of the industrial park. For details of our V2X technology,
see “— V2X Products and Solutions.”
We have obtained automotive-grade ISO certifications including ISO 9001, IATF 16949 and
CCC, and the software architecture of our intelligent driving systems for heavy-duty logistics
trucks complies with the AUTOSAR standard. Combining fault diagnosis, proactive safety with
Automatic Emergency Braking (AEB) and multiple system redundancy via backup units, driverless
logistics trucks equipped with our system experienced zero accidents over 100,000 km.
Central Dispatch Platform
Our central dispatch platform offers similar functionalities as the central dispatch platform
for our METAMINE solution while adapting to the specific conditions and tasks for logistics
operations in industrial parks.
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Emergency Takeover System
Our emergency takeover system utilizes teleoperation station specialized for heavy-duty
logistics trucks to provide an additional layer of safety redundancy, where up to ten trucks can be
remotely controlled from one teleoperation station. It is designed to ensure seamless transfer of
vehicle control from autonomous mode to remote driving mode in the face of complex or
unforeseen situations.
Use Cases
Our closed-environment autonomous logistics truck solution has been utilized in a broad
range of scenarios, with the following achievements:
 Reduced energy costs by approximately 50% compared to traditional gasoline-powered
trucks.
 Improved production efficiency by approximately 30%.
 Increased operating time by 700 hours per truck per year.
 Reduced accident rate by more than 90%.
 Achieved close to 0% latency rate.
 Realized 24/7 continuous autonomous operation.
Liuzhou Automotive Industrial Park Project
In June 2023, we designed and developed intelligent driving systems for Dongfeng Liuzhou
Motor Co., Ltd to enable their logistics trucks to perform driverless logistics tasks such as cargo
transportation at its main manufacturing hub, with the following achievements:
 Operated for over 7,000 hours and completed over 15,000 logistics tasks as of the Latest
Practicable Date.
 Effectively reduced operational costs and improved production efficiency by 15%.
 Recognized by the PRC Ministry of Transportation as one of the earliest pilot intelligent
transportation projects in China.
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V2X
Our V2X products and solutions for intelligent transportation integrate advanced perception
technologies, sensor fusion algorithms, V2X communication capabilities and traffic optimization
algorithms to exchange information between traffic participants (including pedestrians,
non-motorized vehicles and connected vehicles) and roadside infrastructure at urban intersections
or roads. Our products and solutions not only monitor vehicle speeds, trajectories and traffic
conditions but also detect different kinds of traffic events, such as traffic accidents, illegal parking,
wrong-way driving, slow-moving vehicles and traffic congestion.
By linking infrastructures within cities, our V2X solutions make intelligent predictions and
decisions for both urban and highway traffic. They integrate vehicles, roadside infrastructures and
cloud platforms to build robust network computing capabilities, thereby facilitating the
advancement of intelligent transportation systems and smart cities. Our solutions enhance road
safety and enable coordinated traffic perception, dynamic traffic light timing, traffic flow analysis
and congestion alerts.
On-board devices
 Hardware: Connected vehicles equipped with OBUs can communicate with RSUs and the
other connected vehicles. The communication range of V2I (vehicle-to-infrastructure) and
V2V (vehicle-to-vehicle) is over 800 meters with a latency of less than 30ms. The life cycle
of our OBU products is five years.
 Software: The V2X software utilizes advanced communication technology and
decision-making algorithms to promote interactions between connected vehicles and
infrastructures, as well as between drivers and vehicles, to improve road safety, traffic
efficiency and reduce environmental pollution.
 Algorithms: In addition to standard V2X scenarios, our algorithms can also collaborate with
roadside systems to realize customized vehicle-infrastructure coordination in various
application scenarios such as smart cities, smart highways and smart mining zones.
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Roadside devices
 Hardware:
o RSUs (Roadside Units): Equipped with C-V2X (cellular vehicle-to-everything) wireless
technology, RSUs can communicate with OBUs or the cloud platform. RSUs can process
data, communicate with vehicles and integrate sensors, making it useful in various
scenarios such as intelligent transportation, mining, ports and logistics, among others.
Our RSU products have an MTBF (Mean Time Between Failures), which indicates the
duration of proper functioning, of over 50,000 hours.
o MEC (Multi-access edge computing): In an MEC, multi-sensor fusion technology can be
utilized to enable obstacle detection, traffic event detection, traffic information
detection, traffic flow monitoring and other related tasks.
 Algorithms: Algorithms are deployed in MEC devices to collect data from RSUs and shared
in real-time to connected vehicles with OBUs or our V2X APP to enable real-time traffic
participant detection, traffic flow monitoring, incident detection and weather monitoring,
among others, enhancing overall traffic system safety and efficiency. These algorithms can
assist in scenarios such as hazardous location warning (HLW), vulnerable road user collision
warning (VRUCW), wrong-way driving warning (WDW), cooperative intersection passing
(CIP) and cooperative vehicle merging (CVM).
Cloud platform
Our cloud control platform integrates diverse traffic management systems to offer real-time
decision-making support for autonomous vehicles and traffic management authorities. It facilitates
digitalized infrastructure management, enhancing safety, maintenance and operational efficiency
while supporting detailed traffic analysis for optimized decision-making in traffic planning and law
enforcement.
Application Scenarios
V2X + Smart City
Our V2X + Smart City solution aims to create intelligent infrastructure for smart cities,
integrating advanced technologies to enable real-time, accurate and efficient monitoring of road
traffic conditions, especially at complex intersections. This system enhances urban intelligence by
providing expanded perception capabilities for intelligent connected vehicles in sensing, planning,
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decision-making and control processes. It also offers precise data support for cloud-based regional
coordination, thereby elevating city management intelligence and improving traffic safety and
efficiency.
Our solution aims to reduce traffic violations and improve driving efficiency by providing
drivers with comprehensive traffic information that enables them to adjust driving behavior and
make proper driving decisions. In addition, our driving assistance system sends warnings to drivers
before accidents occur, reducing accident rate and asset loss. This solution supports over 20
application scenarios, including holographic intersections, leveraging radar, traffic cameras, AI
algorithms, powerful chips and edge computing to generate precise, real-time metadata such as
vehicle violation captures, vehicle trajectories and signal statuses. These data foundations enable
refined intersection management, aiding traffic authorities in comprehensively understanding
intersection operations for scientific traffic organization and optimization.
Use Cases
V2X + Active Transit Signal Priority (TSP)
We developed the V2X + Active TSP system to increase bus punctuality, reduce passenger
commute times, alleviate peak-hour congestion, promote public transit usage, reduce reliance on
private vehicles and promote energy conservation and emissions reduction.
Addressing issues of inefficiency and delays at urban crossroads for buses, the solution
utilizes traffic light information, bus locations and traffic conditions to predict vehicle path
conflicts, deploy deep learning strategies in C-V2X intelligent roadside systems, assess risks and
calculate optimal passage windows for priority buses while maintaining normal traffic flow.
Real-time adjustments are made to signal control systems to extend green light times and reduce
red light times, enhancing commuter bus efficiency and punctuality.
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OBU
IPU
Intelligent Driving
Passenger
Occupancy Active
Safety Intelligent 360
Surround View
Contraventions
Regulation
Information
Sharing
RSU
Roadside Unit
Cloud
High-Precision
RTK Positioning
(centimeter-level)
Active Priority Requests (>500m)
Location, speed, acceleration, punctuality,
passenger occupancy, in-vehicle conditions
Red light truncation, green light extension
requests, stopping reminder
Passing Control
Mobility Service
Mobility Service
Edge
Computing
Real-Time Location of Vehicles
Real-Time Information of Intersections
Pedestrian Flow at Platforms
Operation Monitoring
Signal Configuration
Network Optimization
Mobility Service
Traffic signal pass
through
Our V2X + Active TSP solution has been deployed in numerous scenarios, with the following
achievements:
 Improved public transport efficiency by about 10% and increased public transport
ridership; estimated to reduce millions of private car usage annually, reducing energy
consumptions and emissions.
 Improved the punctuality of buses by approximately 50%.
 Increased average speed of buses by approximately 13%.
 Reduced travel time; it is estimated that public transport companies can generate
millions of RMB in revenue annually by encouraging passengers to choose public
transportation.
For example, in 2020, we implemented our proprietary “Active Bus Priority” system based on
5G and V2X technology in Changsha, encompassing 139 intersections, 72 public transport lines
and 2,072 buses, the world’s largest TSP system at the time, according to CIC. This system was
promoted nationwide and can significantly reduce bus delay and enhance passengers’ travel
experience. Our “Active Bus Priority” system won the first prize of the China Highway &
Transportation Society’s Science & Technology Award in 2023.
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National-level V2X pilot zones
We facilitated the establishment of one of the largest national-level V2X pilot zones for
Liangjiang New Area, Chongqing (the “ Chongqing V2X Project ”), featuring holographic
intersections. Our V2X technology enabled vehicle-road coordination, smart city management, city
patrol and security and remote driving, constructing the fourth national-level V2X pilot zone in
China and the first carbon-neutral V2X pilot zone in western China with 3D intelligent
transportation scenarios, according to CIC.
Moreover, we participated in the intelligent reformation and networking of almost 100 city
intersections in a national-level V2X pilot zone in Tianjin by providing equipment encompassing
V2X communication, roadside perception and edge computing, as well as enabling holographic
intersection perception.
V2X + Smart Highway
Our V2X + Smart Highway solution aims to upgrade traditional highways into intelligent,
digitalized and interconnected systems to intelligently perceive and manage highway operations
using multi-dimensional sensing and data fusion. It aims to enhance traffic management
capabilities for highways and provide the public with smart, safe, efficient and eco-friendly travel
experiences.
Based on multi-source data from roadside sensing, connected vehicles and cloud platforms,
the V2X + Smart Highway system enables comprehensive real-time traffic perception on highways
including traffic event recognition, environmental perception, participant identification and
lane-level navigation with beyond-line-of-sight information enhancing the transportation
authority’s capabilities of real-time monitoring and managing highways and improving driving
experience. For hazardous highway sections such as entrance/exit ramps and tunnels, our roadside
devices enable 20 scenarios such as guiding vehicles at ramps, speed planning and lane-level
navigation, empowering operators with intelligent monitoring, emergency response, maintenance,
operations and decision-making capabilities.
Use Case
In 2019, we engaged in the intelligent transformation of a 113km section of a highway in
Changsha. Installing sensors, networking and intelligent computing devices at key locations on the
highway, we enabled regional holographic perception, sending warnings for over 15 active safety
or traffic efficiency related scenarios to connected vehicles or non-connected vehicles and
facilitated the transportation authority’s real-time monitoring of the highway operation.
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Intelligent Perception
Our intelligent perception solutions include (i) the train autonomous perception system and
(ii) in-vehicle intelligent perception and safety management solution for commercial vehicles.
Train autonomous perception system (TAPS)
The rail transit industry has a need for trains to possess active perception capabilities. TAPS
is a new generation of active safety system for trains, leveraging fusion perception technology to
fully utilize the detection capabilities of LiDAR, cameras and mmWave radars.
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TAPS serves as an important supplement to the traditional railway signaling system by
providing independent safety redundancy, significantly improving the safety of train operation,
especially for driverless train operations. According to CIC, TAPS is the only product in China
(including Hong Kong, Macau and Taiwan) capable of independent safety perception, realizing
autonomous speed measurement, positioning and active obstacle detection capabilities without
relying on existing railway signaling systems or additional track-side devices, which significantly
reduce overall costs, especially in scenarios with high signaling system costs such as subways.
Such independent safety perception and redundancy also enables more efficient fault recovery
when traditional railway signaling systems encounter system problems or failure as it allows trains
to maintain safe and efficient movement without waiting for the primary signaling system to fully
recover. The product life cycle of TAPS is five years.
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Technological advantages
 Industry-leading ultra-long-distance obstacle detection: Utilizes advanced time-space
synchronization and heterogeneous multi-sensor fusion technology to enable accurate and
stable detection of any type of obstacles within a range of 500 meters, the longest detection
ranges among all competing products with SIL4 certifications in the industry according to
CIC.
 High-precision positioning technology: Operates effectively even in scenarios such as
tunnels without GNSS signals. The system achieves sub-second initial positioning, platform
positioning error below 0.1 meters and comprehensive track positioning error below 0.3
meters, all of which are industry-leading according to CIC.
 Accurate train speed measuring technology: Continuously monitors the train’s operating
speed in real-time with an error margin below 0.1 km/h, making it one of the most precise
measurement systems in the industry according to CIC.
Obstacle Detection
Obstacle size ( M )
Any obstacle Specific obstacle
3.25 × 2.6 (such as trains) 500
200
100
1000
500
250
Centimeter perception
1.5 × 0.4 (pedestrians)
0.3 × 0.3 (box / falling rocks)
Maximum perceived distance ( M )
Train speed measurement:
Train positioning:
Error < 0.1km/h
Sub-second initial positioning Platform positioning error < 0.1m
Comprehensive track positioning error < 0.3m
 Robust environmental adaptation: With strong anti-interference capabilities and perception
technology adaptable to deteriorated conditions, TAPS effectively handles various lighting
conditions and most rain, snow and fog scenarios.
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 Rich product matrix: TAPS can meet diverse customer needs. (i) high-performance products
with stringent SIL4 functional safety certifications or applications demanding extreme
performance and safety, (ii) products that meet SIL2 functional safety certifications for
applications with rigorous safety and reliability requirements, and (iii) cost-effective warning
systems and assisted driving products for less sophisticated scenarios with a wide market
reach.
 Industry-leading deployment speed and adaptability: Leveraging our high-fidelity
rail-specific simulation system and an overall technology architecture that does not rely upon
statistical learning methods, eliminates the continuous need for specific scene data. As a
result, it only takes two weeks for trains installed with TAPS to achieve full operational
readiness since initial launch, the shortest deployment time among comparable products in
China (including Hong Kong, Macau and Taiwan), according to CIC. Moreover, TAPS
employs a unified technology architecture with high replicability, efficiently adapting to
diverse types of train types and scenarios.
 One of a few in China with SIL4 certification with comprehensive function and scenario
coverage: The subsystems and functions of TAPS, including positioning, autonomous speed
measurement, obstacle detection, information push, self-diagnostics and fault alarm,
emergency brake control and obstacle alarm all meet stringent SIL4 certification requirements
of EN50126:2017, EN50128:2011 and EN50129:2018, covering an exceptionally diverse
range of lighting, weather and road conditions.
Use Cases
TAPS has been deployed in Shenzhen, Chongqing, Hefei, Changsha, Xi’an, Wuhan and
Zhuzhou, covering a variety of railway scenarios such as subways, medium and low-capacity trains
and freight trains. Moreover, we were one of the first in the industry to deliver mass-produced,
factory-installed autonomous perception products for trains in collaboration with OEMs, according
to CIC. The entire process from design to implementation strictly follows industry standards,
setting benchmarks in terms of both product performance and quality. TAPS has accumulated
millions of kilometers of safe operation, and has proven to meet the stringent requirements of
intelligent driving in rail transit.
For example, TAPS, which incorporates emergency braking functionality for enhanced safety,
operates on the Bishan-Tongliang Line in Chongqing, spanning a total length of 37.5 km,
comprising 10.5 km of underground railway track, 16 km of bridges and 11 km of at-grade rail
crossing, with nine train stations.
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In-vehicle intelligent perception and safety management solution
Leveraging high-performance intelligent connected devices, our in-vehicle intelligent
perception and safety management solution for commercial vehicles reduces driving risks by
delivering multi-dimensional visual data through a data analysis platform. Additionally, it offers
oversight from pre-incident risk avoidance to post-incident response to enhance safety management
standards by enabling data-driven fleet and risk management in commercial fleet operation
scenarios.
Our in-vehicle intelligent perception and safety management solution delivers a
comprehensive suite of functionalities, including 360-degree surround view, omnidirectional
warning system and vehicle recording with automatic desensitization, among others. These
functions are realized through a single computing device, complemented by sensors and cameras
installed on the vehicle. The system offers 10-100 TOPS of versatile computing power to meet
customizable functional requirements. Adapted for a wide range of vehicle types, including
passenger vehicles, freight trucks, dump trucks, sanitation vehicles and trains, our solution
enhances driver safety and improves security with timely warnings. The life cycle of our
intelligent in-vehicle products is five years.
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Our solution features the following technological advantages:
 Comprehensive perception: Compared to TAPS used in rail transit, which focuses on
perception in the forward and backward directions of train movement, our in-vehicle
intelligent perception and safety management solution utilizes deep learning and AI
algorithms to interpret and analyze information from sensors to provide drivers with
360° surround view around the vehicle body as well as beneath and inside the vehicle
through the creation of a visually transparent chassis and aerial photography-like effects.
Tailored for semi-trailer trucks and other articulated vehicles, utilizes AI visual
algorithms to manage dynamic angle changes between the tractor head and the
semi-trailer and enable the dynamic stitching of articulated vehicle surroundings.
 Accurate and stable warning system: Using motion behavior analysis and false alarm
avoidance technologies to track surroundings, traffic participants and it accurately
assesses potential threats to driving safety, reduces driver distractions and enhances
overall driving experience.
 High adaptability: Leveraging massive data accumulation and generalization technology
guided by large models, it adapts to a variety of vehicle models in diverse scenarios
such as urban transportation, logistics transportation, airports, and port and mining
areas, and can effectively cope with climatic conditions such as rain, snow, fog and
haze.
 Data desensitization and transmission: By adopting leading data security protection
technology and efficient data desensitization algorithms, it enables secure and reliable
data transmission, ensuring user privacy and data security.
Our solution is supported by comprehensive data analysis technology which integrates,
analyzes and visualizes multidimensional data in real-time, providing differentiated operation and
maintenance reports on a regular basis, achieving comprehensive utilization and precise analysis of
in-vehicle data. It also facilitates efficient and intelligent full-process operation management and
oversight from pre-incident risk avoidance to post-incident response.
Moreover, the rise of new energy vehicles has exacerbated challenges in commercial vehicle
safety and related costs. Our products have been selected for mass production by leading
commercial vehicle OEMs such as Sinotruk and FAW Jiefang. Leveraging our solution, OEMs can
introduce more competitive and differentiated products with enhanced driver visibility, reduced
labor intensity and improved vehicle safety, consequently bolstering the OEM’s brand influence.
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Commercialization
We have strategically adopted a product sales model over a fleet operation or management
model, and we may sometimes be required to provide various financial assistance in relation to
such sales to obtain orders from customers. During the Track Record Period, we provided a
guarantee of RMB2.0 million for Customer Y and Customer Z, a guarantee of RMB70.0 million
for the debt owed by Customer K, loans of RMB13.1 million and a deposit of RMB15.2 million
for Customer K. We also granted 24-month credit terms and monthly installment payment
arrangements to Customer M and Customer P. Since many mine operators choose to operate the
mining fleets themselves, according to CIC, a product sales model avoids the exclusion of such
customers. By prioritizing product sales, we can effectively serve any fleet operator without
engaging in direct competition. Moreover, our core competency lies in robotics technology
development and innovation, making the product sales model more aligned with our strengths. The
product sales model also shields us against income fluctuations linked to daily output prices,
weather patterns and supply chain disruptions. By emphasizing the value-add of our proprietary
technology in our product sales, we can focus on iterating and developing innovative products and
swiftly gathering customer feedback to assess product-market fit. This strategic direction not only
validates our technological readiness and product quality but is also a preferred trajectory for our
growth and market positioning.
We adopted a transaction-based model for our products and solutions. We started to
commercialize intelligent driving technology for commercial vehicles in 2018, and were one of the
earliest among industry peers in China (including Hong Kong, Macau and Taiwan) to do so,
according to CIC. We began mass production of our V2X products and solutions in 2019 and
implemented V2X projects in five out of seven national-level V2X pilot zones in China. We began
mass production of our METAMINE and closed-environment autonomous logistics truck solutions
in 2022. As of June 30, 2025, we delivered 304 autonomous mining trucks and 110 sets of
standalone autonomous truck systems to customers. We began mass production of our TAPS and
in-vehicle intelligent perception and safety management solution in 2023 and delivered 80 units
and 11,105 units, respectively, to customers as of June 30, 2025.
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The following table illustrates the key commercialization timeline of our major products,
reflecting our continuous application of advanced technologies:
Specialist Technology Products Launch
Start of Revenue
Generation Mass Production
V2X products and solutions ...... March 2018 December 2018 2019
METAMINE ................. June 2020 September 2021 2022
Closed-environment logistics truck
solution ...................
February 2021 September 2021 2022
TAPS ....................... March 2022 February 2023 2023
In-vehicle intelligent perception
and safety management solution .
October 2022 June 2023 2023
The chart below illustrates our transaction flow from initial customer engagement,
procurement to product delivery and warranty and maintenance.
Customer Onboarding
Customer Needs
Assessment
and Evaluation
Solution and
Pricing Proposal
Agreement on
Terms Reached
Contract execution
Implementation and
Deployment/Shipment and
Logistics Arrangement
Delivery and Acceptance
After-sales Service,
Operations and
Maintenance
Customer Feedback/
Project Archiving
Ongoing Monitoring
of Future Customer Needs
Proposal
Not Adopted
No Current
Collaboration Intention
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Our pre-sales, project implementation and post-sales processes are outlined below.
 Pre-Sales Stage. We conduct comprehensive market research to understand market
trends, the competitive landscape and the needs of potential customers prior to initiating
the customer acquisition process. Once a business opportunity is identified, we typically
conduct frequent customer visits to formulate a preliminary pre-sales solution tailored to
the specific requirements of the customer. The initial proposal, encompassing specific
aspects such as target functions, product performance and cost, is then optimized and
further customized according to customer feedback.
 Project Implementation Stage. Production plans, quality control and logistics are
arranged in accordance with the sales agreements we enter into with our customers. We
conduct on-site installation and testing of the products and solutions, followed by
functionality verification. We provide technical training services to our customers on the
use and operation of our products and solutions, and proactively address any additional
customer needs.
 Post-Sales Stage. Upon delivery, a joint inspection with the customer is conducted to
verify product quantity and quality. Comprehensive after-sales services, including
technical support, system updates and upgrades, routine maintenance and
troubleshooting, are provided to ensure smooth operation and customer satisfaction. We
collect customer feedback to address any complaints or issues promptly, continuously
improving products and services.
We served 44, 85, 131 and 152 customers as of December 31, 2022, 2023, 2024 and June 30,
2025, respectively. Our revenue increased from RMB31.1 million in 2022 to RMB410.0 million in
2024. Our revenue increased from RMB258.5 million in the six months ended June 30, 2024 to
RMB408.0 million in the six months ended June 30, 2025. In 2022, 2023, 2024 and the six months
ended June 30, 2025, the number of our recurring customers amounted to five, six, 19 and 13,
respectively. The number of recurring customers is calculated by subtracting the number of new
customers during the respective period from the total number of customers for the same period.
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The table below sets forth our revenue breakdown in absolute amounts and as percentages of
our total revenue for the years indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Autonomous driving ........ 27,998 90.2 74,418 56.1 254,887 62.1 156,043 60.4 378,364 92.7
Closed-environment autonomous
mining trucks products and
solutions ............ 27,187 87.6 64,132 48.3 246,635 60.1 152,456 59.0 375,820 92.1
Closed-environment autonomous
logistics trucks solution .... 811 2.6 10,286 7.8 8,252 2.0 3,587 1.4 2,544 0.6
V2X products and solutions ..... 3,058 9.8 36,812 27.8 101,591 24.8 74,237 28.7 9,179 2.3
Intelligent perception ........ — — 21,374 16.1 53,557 13.1 28,181 10.9 20,493 5.0
Total ................ 31,056 100.0 132,604 100.0 410,035 100.0 258,461 100.0 408,036 100.0
During the Track Record Period, we recognized revenue on a gross basis for the majority of
our business and recognized revenue on a net basis for the purchases we initiate on behalf of
customers, mainly V2X. In 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025,
revenue recognized on a net basis is nil, RMB1.0 million, RMB1.1 million, RMB0.2 million and
RMB0.4 million, representing nil, 0.8%, 0.3%, 0.1% and 0.1% of our total revenue, respectively.
See “— Customers” and “Financial Information — Discussion of Key Items of Consolidated
Statements of Financial Position — Prepayments and Other Receivables, Current Portion.”
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Key Operating Data
The table below sets forth key metrics of our autonomous driving, V2X and intelligent perception products and solutions:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2025
Autonomous driving V2X Intelligent perception Autonomous driving V2X Intelligent perception Autonomous driving V2X Intelligent perception Auto nomous driving V2X Intelligent perception
METAMINE
solution
Closed-environment
autonomous
logistics
truck
solution TAPS
In-vehicle
intelligent
perception
and safety
management
solution
METAMINE
solution
Closed-environment
autonomous
logistics
truck
solution TAPS
In-vehicle
intelligent
perception
and safety
management
solution
METAMINE
solution
Closed-environment
autonomous
logistics
truck
solution TAPS
In-vehicle
intelligent
perception
and safety
management
solution
METAMINE
solution
Closed-environment
autonomous
logistics
truck
solution TAPS
In-vehicle
intelligent
perception
and safety
management
solution
Number of customers ..... 449 — —84 2 917 2 13 2 72 1 2 1 11 1 0 — 1 2
Number of new customers (1) .. 327 — —63 2 617 1 71 1 918717 —6
Average customer value (2)
(RMB in thousands) .....
6,796.7 202.8 339.8 8,016.6 2,571.4 1,269.4 8,540.9 1,833.3 11,744.5 2,750.7 3,762.6 2,680.2 4,016.4 34,165.4 2,544.0 1,019.9 — 1,863.0
Sales volume (3) ...... 14 trucks 2 sets N/A — — 28 trucks 3 sets N/A 67 units 2,134 units 91 trucks
and 60 sets
6 sets N/A 13 units 6,413 units 171 trucks
and 50 sets
1 set N/A — 2,558
Average contract value (4)
(RMB in thousands) .....
5,489.0 1,707.8 2,961.6 1,764.1 11.0 15,044.5 610.1 1,892.0 1,037.3 28,833.0 22,724.4 15,849.5 1,957.7 3,032.0 29,418.2 8,840.2 676.5 732.1 — 4,75 5.0
Number of projects (5)..... 449 — —66 2 527 1 02 1 728 1 015 —8
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Notes:
(1) Number of new customer in a given period refers to customers who contributed to our revenue in that period and
did not do so in the previous period. A significant portion of our customers are new in each period, primarily due to
our project-based model. In this model, once a project concludes, customers may not immediately require further
transactions with us until additional needs arise in the future.
(2) Average customer value for a given period is calculated by dividing revenue in that period by the number of
customers for the same period.
(3) The sales volume of our METAMINE solution refers to the sales of autonomous mining trucks. In 2024, we also
sold 60 sets of standalone autonomous truck systems. The sales volume of V2X products and solutions are not
included because their sales vary from individual hardware devices to solution packages, making it difficult to
quantify or provide meaningful comparison.
(4) Average contract value is calculated by dividing the total contract value for the given category signed with
customers in that period by the number of contracts for the same category signed in the same period. Such value is
for indicative purpose only as it may fluctuate substantially each year and for different product categories due to
factors such as variations in project scale, duration, scope and timing of signing, among others.
(5) Number of projects in a given period refers to the projects for which revenue is recognized during that period. The
number of projects may be lower than the number of customers, primarily because although we adopt a
project-based model for most of our products and solutions, we also sell certain standardized products on an
off-the-shelf basis.
We adopt a project-based model for most of our products and solutions. The average
customer value and average contract value for intelligent driving was relatively low in 2021
because at the initial stages of our intelligent driving business, customers ordered smaller
quantities of our products. As our intelligent driving offerings became more mature and developed
a stronger reputation in the market, we signed increasingly larger projects with customers for a
substantially larger quantity of our autonomous trucks and systems. The average customer value
for V2X products and solutions fluctuated during the Track Record Period because the products
and solutions offered to each customer varies significantly due to individual customer needs.
Certain of our products are sold on an off-the-shelf basis, such as our teleoperation station
and standard in-vehicle devices for our in-vehicle intelligent perception and safety management
solution that require relatively little customization, although some may involve different module
combinations according to customer needs. For such products, the components are typically made
according to orders received, although some components are readily available in our inventory.
All customers who contributed to our revenue during the Track Record Period were located in
mainland China.
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Our Major Projects
The table below sets forth details of our major projects with the highest revenue contribution for each business line in each
year/period of the Track Record Period and on-going as of the Latest Practicable Date.
Revenue
Y ear of revenue
recognition
% of total
revenue in the
year of revenue
recognition Customer background Place of implementation Products/solutions provided Project description Project duration
Contract sum (1)
(tax inclusive) Backlog value
(RMB in
thousands)
(RMB in thousands)
Autonomous Driving
An autonomous mining
project for a large coal
mine ......
190,646 2025 46.7%
for six months
ended June 30,
2025
A company founded in 2018 and registered
in Inner Mongolia, which is Customer M
among our five largest customers in the
six months ended June 30, 2025. The
company primarily engages in mining and
construction services.
Zhungeer, Inner Mongolia METAMINE solution We delivered 100 driverless hybrid mining trucks
along with a supporting autonomous truck system
for a mining project. These trucks feature
360-degree perception with no blind spots, are built
to withstand harsh environments and enhance
environmental awareness and decision-making
efficiency, enabling safer operations in mining areas
without the need for safety back-up personnel.
Approximately five months
with a warranty period of
three years
220,000 —
An autonomous mining
project for a large coal
mine ......
152,299 2024 37.1% A company founded in 2021 and registered
in Anhui, which is Customer K among our
five largest customers in 2024. The
company primarily provides engineering
technical services and engages in the
design and execution of construction
projects.
A large coal mine in
Northwestern China
METAMINE solution We provided 56 autonomous mining trucks and
accompanying autonomous truck systems. The
autonomous mining trucks we delivered are capable
of efficiently and safely in complex environments,
achieving mixed operations with manned vehicles
in open-pit coal mines.
Approximately nine months
with a warranty period up
to five years
175,380 —
Notes:
(1) The difference between the contract sum and the revenue recognized is attributable to the inclusion of taxes within the contract value.
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Revenue
Y ear of revenue
recognition
% of total
revenue in the
year of revenue
recognition Customer background Place of implementation Products/solutions provided Project description Project duration
Contract sum (1)
(tax inclusive) Backlog value
(RMB in
thousands)
(RMB in thousands)
An autonomous mining
project for a sand and
gravel mine ....
41,263 2023 31.1% A company founded in 2020 and registered
in Hubei, which is Customer F among our
five largest customers in 2023. The
company is an automotive OEM that
primarily engages in the R&D, design,
production and sales of automobiles and
automotive parts.
Wuxue, Hubei Province METAMINE solution We provided 20 fully electric autonomous mining
trucks that can smoothly complete unmanned
haulage tasks in complex scenarios with high traffic
volumes and achieve mixed operations with manned
vehicles in sand and gravel aggregate mines.
Approximately nine months
with a warranty period of
one year
46,627 —
An autonomous mining
project for a sand and
gravel mine
(2)....
22,152 2022 71.3% A company founded in 2007 and registered
in Hong Kong, which is Customer A
among our five largest customers in 2022
and 2024. The company primarily engages
in the production of cement and cement
products, as well as the operation of port
facilities for cargo handling and storage.
Jurong, Jiangsu Province METAMINE solution We delivered 14 driverless electric mining trucks for
an intelligent mining project in Jurong, Jiangsu.
This project enabled the mine operator to perform
autonomous loading, haulage, unloading and
recharging operations around the clock without the
need for safety back-up personnel.
Approximately nine months
with a warranty period of
one year
25,032 —
Notes:
(2) We incurred gross loss for this project, primarily due to (i) this being China’s first autonomous electric mining project with full mining area cov erage, where we
offered the customer a preferential price to seize market opportunities, gain industry experience, and secure future collaborations; and (ii) the e xtended execution
period and our significant investment in manpower and materials for technical adjustments, as it was our first mining truck project.
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Revenue
Y ear of revenue
recognition
% of total
revenue in the
year of revenue
recognition Customer background Place of implementation Products/solutions provided Project description Project duration
Contract sum (1)
(tax inclusive) Backlog value
(RMB in
thousands)
(RMB in thousands)
V2X
A V2X demonstration zone
project (Shenzhen V2X
Project) ......
7,591 2025 1.9% for the six
months ended
June 30, 2025
A company founded in 2007 and registered
in Shenzhen, primarily engaging in
providing intelligent connected solutions
for commercial vehicles.
Shenzhen, Guangdong
Province
V2X products and solutions We provided V2X products and solutions such as
OBUs and RSUs, enabling a comprehensive
upgrade and networked transformation of
signal-controlled intersections in Pingshan,
Shenzhen.
Approximately 16 months
with a warranty period of
two years
11,695 —
A V2X demonstration zone
project (Chongqing V2X
Project) ......
60,133 2024 14.7% A company founded in 2019 and registered
in Chongqing, which is Customer L among
our five largest customers in 2024. The
company primarily engages in investment,
property management, real estate
development and property leasing.
Chongqing V2X products and solutions We provided intelligent driving vehicles and V2X
products and solutions such as OBUs and RSUs,
integrating edge computing technologies and
completed the intelligent transformation of roadway
with full C-V2X coverage over 55km and 98
intersections, facilitating the construction of an
intelligent driving demonstration zone.
Approximately 36 months
with a warranty period of
two years
67,103 —
A V2X pilot zone project . 9,884 2023 7.5% A company founded in 2005 and registered
in Beijing, which is Customer G among
our five largest customers in 2023. The
company primarily engages in the
development and provision of
location-based services and intelligent
transportation solutions.
Xiangyang, Hubei Province V2X products and solutions We provided V2X products and solutions including
OBUs, RSUs and accompanying systems, enabling
intelligent upgrade and connection of 52
intersections and 255 buses.
Approximately 12 months
with a warranty period of
three years
11,267 —
An open road intelligent
transformation project .
1,032 2022 3.3% A company founded in 2019 and registered
in Hunan, which is Customer D among our
five largest customers in 2022. The
company primarily engages in the
development and application of intelligent
driving technologies and solutions.
Changsha, Hunan Province V2X products We provided RSUs for the V2X upgrade of 31
intersections, facilitating intelligent infrastructure
transformation.
Approximately 17 months
with a warranty period of
three years
1,166 —
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Revenue
Y ear of revenue
recognition
% of total
revenue in the
year of revenue
recognition Customer background Place of implementation Products/solutions provided Project description Project duration
Contract sum (1)
(tax inclusive) Backlog value
(RMB in
thousands)
(RMB in thousands)
Intelligent Perception
A rail transit project .. 5,266 2024 1.3% A company founded in 2014 and registered
in Beijing, primarily providing
comprehensive intelligent urban rail transit
solutions leveraging its digital
technologies.
Chongqing TAPS We provided our TAPS system for rail transit,
enabling autonomous speed measurement and
positioning and active obstacle detection of trains
equipped with TAPS, delivering robust
technological support for the safe and efficient
operation of rail transit systems.
Approximately five months
with a warranty period of
two years
5,950 —
A vehicle intelligence
project ......
68,753 2023, 2024 and
June 30, 2025
8.8% for 2023;
9.5% for 2024;
4.5% for the six
months ended
June 30, 2025
A company founded in 2007 and registered
in Chengdu, primarily engaging in the
production and sales of automobiles and
automotive parts and components.
Chengdu, Sichuan Province In-vehicle intelligent
perception and safety
management solution
We provided IPUs and OBUs, enabling the intelligent
upgrade of the customer’s heavy-duty trucks,
enabling adaptive surround view, intelligent
three-dimensional object detection and warning,
automatic pedestrian and vehicle information
desensitization, among others. These features offer
truck drivers a smarter, safer and more pleasant
driving experience and enhance the operational
management of commercial vehicle fleets.
Products delivered by batches
pursuant to the annually
renewed framework
agreement
170,000 81,689
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OUR TECHNOLOGIES
Proprietary Technologies
Key algorithms underpinning our products and solutions
Industry-leading autonomous vehicle planning and control technology
We offer autonomous planning and control systems for heavy-duty vehicles. Our expertise
lies in developing a range of autonomous trucks, from high-speed semi-trailer tractors to
articulated mining trucks, equipped for automatic steering, acceleration, deceleration and
navigation in fixed and uncertain scenarios. Our systems integrate tightly with drive-by-wire
setups, utilizing optimized navigation techniques, machine learning algorithms, and dynamics
control principles for efficient development and deployment. By employing optimal and predictive
control methods alongside machine learning, we ensure adaptivity and robustness, enabling
precise, collision-free trajectory control in complex scenarios such as high-speed navigation,
large-curvature turns, reverse parking, overtaking and emergency braking. With a focus on vehicle
dynamics modeling and optimal control strategies, we excel at deploying complex industrial
vehicles in challenging environments.
Our algorithms accommodate various powertrains and account for terramechanics, power, and
transmission factors, delivering robust performance even under actuator degradation, with parking
systems realizing lateral and longitudinal accuracies within five centimeters. Our autonomous
trucks utilize state-of-the-art multi-modal planning and adaptive optimization algorithms for
navigating fixed and non-fixed routes. Our advanced trajectory planning technology ensures high
precision and adaptive path adjustments for maneuvers in complex environments and calculates
trajectories in real-time to enhance fleet efficiency. Employing game-theoretical and Markov
decision process techniques, our planning system predicts traffic behavior and interacts with
human-driven vehicles effectively.
Dust, fog and vibration-proof perception systems
Our vehicles feature advanced perception systems, incorporating LiDAR, radar and vision
within a connected “sensor matrix,” crucial for high-level intelligent driving, especially in dynamic
industrial and commercial settings demanding high reliability and accuracy. As a result, our
vehicles consistently operate without drivers, offering a reliable path to commercial vehicle
autonomy.
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Through years of refining design choices and technical breakthroughs, we incorporate
multi-sensor fusion techniques to optimize sensor performance by filtering environmental noise
such as rain, fog, dust and lighting. We self-developed object detection technologies that are
adaptive to terrain changes, ensuring reliable performance under varying conditions. By executing
multiple tasks simultaneously via sensor network algorithms, such as occlusion detection,
drivable-area detection, 2D and 3D object detection and grid-based recognition with vision
transformers, the system effectively analyzes complex road conditions, even in low visibility.
Advanced multi-agent decision and optimization technology
We developed proprietary multi-vehicle coordination technology for heavy-duty fleets. Our
dedicated software system, G-Synthesis, integrates with multiple independent autonomous vehicles
to create a cooperative fleet system. Using both distributed V2V methods and centralized
coordination, our vehicles work together to achieve collective goals such as queueing, resolving
traffic conflicts and preemptively creating ideal traffic arrangements, effectively avoiding traffic
congestions or deadlocks, guaranteeing successful autonomous fleet deployment for our customers
to enhance operational efficiency.
Our comprehensive multi-agent system encompasses functions such as traffic coordination,
agent prediction, dispatching and scheduling, leveraging techniques such as graph-based search,
traffic flow analysis and other optimization algorithms. Rigorous testing and validation using
advanced computational tools and machine learning methods guarantee the adaptability of our
traffic coordination mechanisms to new and diverse scenarios. Capable of coordinating up to 1,000
vehicles concurrently, including human-driven ones, our autonomous fleets exhibit exemplary
coordination in various complex settings, from orderly queuing at mine workfaces, complex
parking scenarios to managing dynamic loading areas and load staggering balancing requirements
efficiently.
Integrating connected vehicles with intelligent driving
We integrate V2X technology with intelligent driving to introduce advanced functionalities,
utilizing low-latency direct vehicle communication through DSRC and C-V2X to enhance
autonomous vehicle capabilities and fleet operations. V2X technology not only creates independent
commercial opportunities but also serves as a foundation for running autonomous vehicle fleets via
V2X connectivity, enabling timely coordination and information sharing.
These advanced functionalities encompass V2V platooning, synchronized acceleration and
deceleration and V2I systems delivering real-time data to vehicles through roadside perception,
enhancing fuel efficiency, safety and operational efficiency at intersections. Leveraging distributed
cooperative systems on V2V networks, we implemented V2V platooning for heavy truck fleets at
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speeds up to 60 km/h, local V2V traffic networks for up to 20 mining trucks and traffic-free
signaling for unstructured intersections, demonstrating our dedication to advancing reliable and
comprehensive traffic solutions through the fusion of V2X and intelligent driving technologies.
Complete human-to-robot complementary technologies
Our autonomous driving solutions, especially the METAMINE solution, feature subsystems
designed to enhance human-robot interactions. For remote-assisted operations and occasional
teleoperated takeover, we use ultra-low latency teleoperation station, specifically designed for
heavy-duty vehicles and industrial machinery. For dispatch and scheduling, we offer curated data
dashboards and analytics for driverless fleet operators. For human-driven vehicles and machinery,
we provide integrated dispatch and coordination terminals. These technologies improve overall
usability, maintainability and practicality, allowing one remote engineer to manage the operations
of a fleet of autonomous vehicles comfortably from a dispatch office. Moreover, the interactive
elements of our system designs enhance the user interface and user experience of our products and
solutions. Our software is tightly integrated with our driverless fleet, ensuring a seamless
experience for human operators, and enabling remote operations such as blast site scheduling,
vehicle maintenance and fleet monitoring.
Algorithms and tools for internal development and testing
Simulation
Simulation is essential for designing, validating and verifying our intelligent driving systems.
Our entire technology stack can be simulated with internal proprietary tools and development
environments, including the use of virtual perception obstacles, decision, planning, positioning,
control and vehicle dynamics. We use multi-modal robotics simulation platforms internally to test
singular driverless vehicles and fleets of vehicles or for high-fidelity complex traffic simulation.
Our simulation platform can test over 300 autonomous vehicle systems operating
simultaneously in one common artificial reality. Deploying a commercial autonomous fleet that
operates safely and effectively requires simulating not only single vehicles, but also the behavioral
interactions between multiple vehicles. This allows us to effectively test high-dimensional AI
algorithms, including complex techniques such as multi-agent reinforcement learning and
distributed control. Consequently, our autonomous fleets display an industry-leading capacity to
solve or even entirely avoid traffic jams or deadlocks, since we fully test these possibilities prior
to physical deployment.
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Our simulation systems are an integral part of our engineering processes. Distributed
simulated robotic vehicles in simulated environments are interconnected in a cloud-based
multi-system software-in-the-loop system to validate the cooperative traffic abilities of the
driverless software. We also integrate human-driven systems such as virtual human-driven vehicle
and dispatch systems in the loop to confirm overall operational requirements in mixed operation
scenarios. As of June 30, 2025, through providing engineers with automated data analytics and
generated reports, we had validated over 3,000 new features or bug fixes through simulation for
the METAMINE solution alone.
To optimize computing capacity, we focus efforts on particularly challenging scenarios such
as signal-free intersections, multi-vehicle approaches, queuing and overtaking under uncertainty.
Such scenarios are often sensitive to changing boundary conditions, with no fixed solutions. To
ensure adequate coverage of algorithm designs, we test them by creating hundreds of scenarios
using generative methods to validate the system’s performance boundaries.
Robust and maintainable modular hardware deployment tools
To accelerate deployment and provide reliable intelligent driving products, we developed a
suite of modular hardware deployment tools. These tools improve project and inventory turnover,
increase staff efficiency and enhance customer satisfaction. Our capability is evident in our rapid
and successful delivery of some of the world’s most complex driverless mining projects across
China.
Our tools include automated sensor calibration tools, drive-by-wire testing tools, production
testing tools, data analytics tools and connectivity tools. The deployment cycle for our autonomous
trucks takes only 30 days from commissioning to operational readiness, ahead of industry levels,
which typically take several months, according to CIC. For on-site deployment, our tools and
remote software deployment can effectively handle projects such as underground mining and
railway perception without engineers being physically present.
RESEARCH AND DEVELOPMENT
Our ability to develop new technologies, design new products and solutions, and enhance
existing products and solutions is critical for maintaining our market position.
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R&D Team
Our R&D team consists of talents with extensive industry expertise, focusing on developing
and commercializing our products and solutions which help maintain our technological advantages
and market competitiveness. Our core R&D team members have an average of more than 15 years
of experience in engineering, with domestic or overseas working experience in reputable
technology companies. Each of our core R&D team members has their specialized area and the
following table sets out their profile:
Core R&D team member Profile
Dr. MA Wei ........... A Silicon Valley veteran, our co-founder, vice chairman and chief
architect, Dr. Ma, has over 30 years of expertise in robotics, signal
processing and automotive industries. He previously held key research
positions at National Semiconductor Inc and Texas Instrument Inc in
the United States, specializing in intelligent driving applications. He
brings profound technical and managerial experience, and is primarily
responsible for designing our technology architecture and leading the
R&D of new products and technologies at our Company. See
“Directors and Senior Management — Directors — Executive
Directors.”
Dr. HU Albert Sibo ..... Our executive Director and chief executive officer who has over ten
years of experience in automated systems and artificial intelligence.
He oversees our daily operations and is responsible for managing our
CidiLabs Research Institute as well as our engineering and quality
management department, among other operational units. He is
primarily responsible for the R&D of system algorithms and
simulation. See “Directors and Senior Management — Directors —
Executive Directors.”
Mr. LIU Zhou ......... Our vice president with 12 years experience in the field of
electromechanical engineering. He oversees our intelligent driving
department and is the head of our autonomous mining division. His
primary responsibilities include the design and development as well
as testing and validation of our mining products.
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Core R&D team member Profile
Dr. SHENG Weitian ..... Our director of our autonomous truck division, with extensive
experience in the field of software engineering and high-performance
algorithms, and is primarily responsible for product design and
development as well as testing and validation of our autonomous
commercial trucks.
Dr. HU Rongdong ...... Our vice president with approximately ten years of experience in the
field of AI. He is the head of our V2X and intelligent perception
division, primarily responsible for the design and development as well
as testing and validation of intelligent perception and cloud platform
products.
As of June 30, 2025, our R&D team consisted of 249 members, over half of which held a
postgraduate degree or above. Our R&D team represented 54.1% of total employees as of the same
date. Our research and development expenses amounted to RMB110.5 million, RMB90.4 million,
RMB193.2 million, RMB35.3 million and RMB151.3 million in 2022, 2023, 2024 and the six
months ended June 30, 2024 and 2025, respectively.
We retain key management and technical staff with competitive remuneration packages and
welfare benefits. We also invest in continuing education and training programs to upskill our key
management and technical staff. In the event of termination of employment requested by a key
staff, we closely communicate with the staff for the reason of departure and feedback for us. The
salient terms of agreements with management and technical staff are set out below:
 Ownership of intellectual properties. We hold the intellectual property rights, including
patent rights, proprietary technology rights, copyrights and related interests, to any
proprietary technology, patented products and other works created or contributed to by
the employee as part of their duties during their term of employment.
 No conflict. Employees shall not engage in any other job, whether full-time or
part-time, during their term of employment.
 Non-competition. We have the right to unilaterally initiate a non-competition period of
up to two years following the termination of employment. During the term of
employment and the non-competition period initiated by us, employees shall not engage
in any competitive behavior specified in the agreements.
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 Confidentiality. During the term of employment, except as necessary to perform their
duties, and for all time thereafter, employees shall not, without our prior written
consent, disclose, divulge, announce, publish, impart, transfer or otherwise make known
to any third party, or in any way use any information, such as technical and trade
secrets, belonging to us or belonging to any other party for which we have a duty of
confidentiality.
To improve our R&D capability at the group level, we have established incentive programs
for our R&D employees. We grant cash rewards to employees who materially contribute to our
patent applications, trademark registrations or software copyrights.
During the Track Record Period, there was no legal claim or proceeding that may have an
influence on the R&D of our Specialist Technology Products.
Key Research Projects
We are currently engaged in various R&D projects to iterate and upgrade our products and
solutions, with the following key projects:
Autonomous Driving
 METAMINE. We have been conducting R&D to upgrade METAMINE for more intelligent
and reliable driverless drilling, blasting, excavation and haulage processes and more
integrated functionalities, with plans to launch our upgraded METAMINE solution in 2026.
The upgraded METAMINE solution will further optimize mining operations by utilizing a
centralized command platform for the unified management and scheduling of drilling,
excavation, blasting and haulage equipment based on real-time site conditions. It aims to
achieve full on-site automation of the four key mining processes, including unmanned
haulage, and intelligent remote operation of excavation, drilling and blasting operations.
 Cabless autonomous mining trucks. We commenced the R&D of autonomous mining trucks
without driver cabins in 2023 and expect to launch the product in 2025. The cabless design
significantly enhances maneuverability, eliminates the need for cabin space, enables loading
and unloading without the need for U-turns, and offering advanced functions such as
dual-axle steering and diagonal movement. These trucks aim to streamline mining transport
processes by reducing costs, increasing efficiency, minimizing energy consumption and
imposing lower demands on road and site conditions.
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V2X
 Upgraded RSU products. We commenced the iteration of RSU products in May 2024,
conducting preliminary research based on new NR V2X technology, and expect to launch the
products by the end of 2025. The enhanced RSU products will integrate the latest 5G and
C-V2X technologies to boost data transmission speed, reduce communication delays and
enhance NR-V2X communication capabilities for enhanced safety, reliability, interoperability
and more stable performance in challenging road conditions.
 Upgraded V2X + Active Transit Signal Priority System. We are conducting R&D to upgrade
our V2X + Active Transit Signal Priority system to enable adaptive prioritization of
emergency vehicles, with plans to launch the upgraded solution in 2025. The upgraded
solution aims to enhance emergency vehicle passage throughout road networks.
Decision-making based on roadside traffic data and emergency requests enables smoother
passage for emergency vehicles and automates emergency routing. This upgrade focuses on
improving dynamic route adaptability while minimizing traffic disruptions.
Intelligent Perception
 TAPS. We conducted the R&D of upgraded TAPS in 2024 to enhance the reliability and
performance of its sensor-suite, and have launched the upgraded product in October 2024.
The upgraded TAPS enhanced sensor reliability and performance and expanded perception
ranges. It enhanced adaptability in challenging conditions such as rain and snow, shortens
deployment cycles with refined simulation and testing tools. We plan to offer customized
solutions targeting specific scenarios such as long-distance perception, and aim to further
enhance adaptability, stability and deployment efficiency to reinforce product
competitiveness.
We do not expect any material changes in revenue mix, business model, geographical region
and end user industry, use cases or application scenarios in the foreseeable future.
Outsourced R&D Arrangements
During the Track Record Period, we engaged independent technology companies specializing
in the design and development of embedded hardware products for outsourced R&D arrangements
for certain assistive hardware that form parts of our products and solutions. We primarily
outsource non-core general technology and hardware development. This arrangement enables us to
focus on our core competencies, specifically the development and application of algorithms related
to autonomous driving and V2X technology, optimizing software functionality and algorithm
efficiency. By partnering with outsourcing firms that have mature development processes and
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technical platforms, we can significantly accelerate new product development, thereby reducing
time-to-market and gaining a competitive edge. Additionally, outsourced R&D optimizes the
utilization of our in-house R&D personnel, enhancing overall R&D effectiveness and resource
utilization efficiency.
In 2022, 2023, 2024 and the six months ended June 30, 2025, we engaged four, six, eight and
one independent technology companies for outsourced R&D, respectively. Our outsourced R&D
arrangements accounted for 0.8%, 0.5%, 1.1%, 0.6% and 0.5% of our total R&D expenses in 2022,
2023, 2024 and the six months ended June 30, 2024 and 2025, respectively. The major salient
terms of our standard outsourced design service agreements are set out below:
 Intellectual Property. The final R&D deliverables and associated intellectual property
rights arising from the performance of this agreement shall be jointly owned by both
parties within mainland China. The technology service providers retain the ownership of
the underlying technologies related to the product developed under this agreement, as
well as any pre-existing technological achievements and intellectual property. We shall
have the right to use these technologies and intellectual properties free of charge for the
purposes of the collaborative project.
 Confidentiality. Either party is responsible for keeping strict confidentiality of all the
information provided by the other party, and would be responsible for any breach of
confidentiality. The confidentiality clause applies for three years from the termination of
the agreement.
 Termination. The agreements will be terminated by mutual agreement, or by other
means as set forth in the agreements.
R&D Process
We developed a four-step iteration methodology, comprising functional, completeness,
optimization and reliability loops, which guides our technology evolution, shaping product
decisions, operational processes and organizational structure.
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The following chart illustrates our each step of our product development and iteration
process:
Start
Market research
and analysis
System design
and evaluation Technology pre-researchHardware suppliers
Outsourced suppliers
Design changes
System adaptation and
application development
Detailed plan
design and review
Prototype trial
manufacturing and testing
Prototype evaluation
YES
Design freeze and
process plan evaluation
Trial production and
process evaluation
Mass production
Technical document
submission
Project completion
End
NO
Hardware design
and sampling
Project establishment
and evaluation
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Our product development process is primarily divided into five main stages: (i) product
planning: (ii) product design and development; (iii) process design and development; (iv) product
and process validation; and (v) feedback evaluation and correction. We conduct a comprehensive
analysis of customer needs and technical requirements through requirement gathering and
feasibility analysis, which forms the basis for our product design plan. We conduct design failure
mode and effects analysis (DFMEA) to enhance the reliability and safety of our products. Upon
completion of supplier selection and formulation of the product testing plan, we proceed with
prototype production and performance review. During the process design and development stage,
we utilize process failure mode and effects analysis (PFMEA) to improve efficiency and process
safety, and develop a series of guiding documents to prepare for subsequent trial production. In the
product and process validation stage, we conduct trial production and measurement system analysis
to confirm whether the product is ready for mass production. We place great emphasis on customer
feedback and evaluation to refine our final product.
INTELLECTUAL PROPERTY RIGHTS
Intellectual property rights are important to our business. Our future commercial success
depends, in part, on our ability to obtain and maintain patents and other intellectual property and
proprietary protections for commercially important technologies, inventions and knowhow related
to our business, defend and enforce our patents, preserve the confidentiality of our trade secrets,
and operate without infringing, misappropriating or otherwise violating the valid and enforceable
intellectual property rights of third parties.
As of the Latest Practicable Date, we had 513 patent applications and 362 registered patents
in the PRC, including 170 invention patents, 107 utility patents and 85 design patents. As of the
same date, we also had 78 software copyrights and 267 registered trademarks in the PRC. In
addition, we had eleven registered patents and seven trademarks overseas as of the Latest
Practicable Date.
We acquire patents through self-development. As of the Latest Practicable Date, with respect
to our specialist technology products, we self-owned all of our patents as well as patent
applications and had no co-own or co-share arrangements of our patents and patent applications
with third parties.
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Our material intellectual property rights cover technical areas including autonomous driving,
V2X and intelligent perception. In the opinion of our PRC Legal Advisor, we established a system
for the management and protection of intellectual property to cover the material aspects of each of
our major Specialist Technology Products as of the Latest Practicable Date. The table below sets
forth the key intellectual property rights corresponding to the core technologies applied in our
Specialist Technology Products:
Specialist Technology
Products Core Technology Patent
Functions/
Application Scenario
METAMINE ........ A method for autonomous
parking
ZL202011223872.6 Autonomous parking for mining
trucks
Methods for vehicle
control
ZL202110383026.9
ZL202110359496.1
ZL202110415982.0
High-precision control of
autonomous mining trucks
A method for mixed fleet
operation of manned
and unmanned vehicles
ZL202010812105.2 Enable mixed fleet operation of
driverless mining trucks in
collaboration with
human-driven vehicles
A method for estimating
total vehicle mass
ZL201910223240.0 Enable the precise control of
driving or braking forces of
mining trucks based on payload
Closed-environment
autonomous logistics
truck solution ......
A method for vehicle
control
ZL201910188587.6 Precise vehicle control for
driverless logistics operations
Methods for obstacle
avoidance
ZL201811556253.1
ZL202110381578.6
ZL201811441511.1
Precise obstacle detection and
avoidance decisions
A method for generating
parking trajectories
ZL202010402570.9 Autonomous parking for logistics
trucks
V2X products and
solutions .........
An algorithm based on
C-V2X technology
prioritizing public
transportation
ZL202 111146639.7
ZL202110222764.5
ZL202110222763.0
ZL202110222712.8
Traffic signal priority in different
scenarios, including absolute
priority, single lane priority and
multi-lane priority
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Specialist Technology
Products Core Technology Patent
Functions/
Application Scenario
TAPS ............ Methods for obstacle
detection
ZL202310917141.9
ZL202310787664.6
ZL202110306554.4
Forward perception for trains
A method for LiDAR
calibration
ZL202310464282.X Sensor calibration
In-vehicle intelligent
perception and safety
management solution
for commercial
vehicles .........
A panoramic stitching
method for semi-trailers
ZL201911289818.9 Panoramic stitching
Methods for object
detection and model
training
ZL201910406367.6
ZL201910985902.8
ZL202010199855.7
ZL202110525549.2
ZL201911333161.1
Pedestrian warning and object
detection
We confirm that all of the above listed patents are significant for carrying out the key
functions of our Specialist Technology Products, and no other material patents are directly applied
in our Specialist Technology Products.
Our industry consultant, CIC, confirms and our Directors are of the view that based on the
information above, each of our products and solutions fall within an acceptable sector of a
Specialist Technology Industry, including Electric and Autonomous Vehicles and Advanced
Transportation Technology under Advanced Hardware and Software as defined under Chapter 18C
of the Listing Rules.
Regarding the tenure of our intellectual properties: (i) for patents, according to the Patent
Law of the PRC, the validity period of an invention patent is 20 years from the filing date; and (ii)
for copyright, according to the Copyright Law of the PRC, except for the rights of authorship,
modification and the protection of the integrity of the work, which are not subject to time
limitations, the publication right of a legal entity’s software copyright is protected for fifty years,
ending on December 31 of the fiftieth year after the completion of the creation. The protection
period for other copyrights is fifty years, ending on December 31 of the fiftieth year after the first
publication.
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Regarding the payment obligations in relation to our intellectual properties: (i) for issued
invention patents, we are mainly required to pay the annual patent fee to competent authorities. We
have kept track of the payment requirements for annual fees and made payment accordingly. Up to
the Latest Practicable Date, all the due annual fees for the issued patents are paid and the issued
patents are valid according to our PRC Legal Advisor; and (ii) for pending patents, we are mainly
required to pay the application fee, the substantive examination fee and the re-examination fee,
depending on the examination progress, and we made the payment as required by the competent
authorities as of the Latest Practicable Date. As the intellectual properties for each of our
Specialist Technology Products are all self-developed, and have not been licensed or transferred
from third parties, so there are no corresponding license or transfer fees that we are obligated to
pay.
The term of an individual patent may vary based on the countries/regions in which it is
granted. In China, the term of an issued patent for invention is generally 20 years from the filing
date of the earliest non-provisional patent application on which the patent is based in the
applicable country. The actual protection afforded by a patent varies on a claim-by-claim and
country-by-country basis and depends upon many factors, including the type of patent, the scope
of its coverage, the availability of any patent term extension or adjustment, the availability of legal
remedies in a particular country/region and the validity and enforceability of the patent. We cannot
provide any assurance that patents will issue with respect to any of our owned or licensed pending
patent applications or any such patent applications that may be filed in the future, nor can we
provide any assurance that any of our owned or licensed issued patents or any such patents that
may be issued in the future will be commercially useful in protecting our product candidates and
methods of designing the same. See “Risk Factors — Risks Relating to Our Intellectual Property
Rights — We may not be able to obtain or maintain adequate intellectual property rights protection
for our product and solution, or the scope of such intellectual property rights protection may not
be sufficiently broad.”
We may rely, in some circumstances, on trade secrets and/or confidential information to
protect aspects of our technology. We seek to protect our proprietary technology and processes, in
part, by entering into confidentiality agreements with consultants, advisers and contractors. We
have entered into confidentiality agreements and non-competition agreements with our senior
management and certain key members of our R&D team and other employees who have access to
trade secrets or confidential information about our business. Our standard employment contract,
which we use to employ our employees, contains an assignment clause, under which we own all
the rights to all inventions, technology, know-how and trade secrets derived during the course of
such employee’s work.
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These agreements may not provide sufficient protection of our trade secret and/or confidential
information. These agreements may also be breached, resulting in the misappropriation of our trade
secret and/or confidential information, and we may not have an adequate remedy for any such
breach. In addition, our trade secret and/or confidential information may become known or be
independently developed by a third party, or misused by any collaborator to whom we disclose
such information. Despite any measures taken to protect our intellectual property, unauthorized
parties may attempt to or successfully copy aspects of our products or to obtain or use information
that we regard as proprietary without our consent. As a result, we may be unable to sufficiently
protect our trade secrets and proprietary information. See “Risk Factors — Risks Relating to Our
Intellectual Property Rights — We may be unable to protect the confidentiality of our trade
secrets, and we may be subject to claims that our employees or third parties have wrongfully used
or disclosed alleged trade secrets owned by others.”
We also seek to preserve the integrity and confidentiality of our data and trade secrets by
maintaining physical security of our premises and physical and electronic security of our
information technology systems. Despite any measures taken to protect our data and intellectual
property, unauthorized parties may attempt to or successfully gain access to and use information
that we regard as proprietary. See “Risk Factors — Risks Relating to Our General Operations —
Our information technology networks and systems may encounter malfunction, unexpected system
failure, interruption, insufficiency or security breaches.”
As confirmed by our Directors, during the Track Record Period and up to the Latest
Practicable Date, we did not have any instances of infringement of third parties’ intellectual
property rights. For details, see “Appendix VII — Statutory and General Information — Further
Information about Our Business — Intellectual Property Rights.” For risks related to intellectual
property rights, see “Risk Factors — Risks Relating to Our Intellectual Property Rights.”
COMPETITION
China (including Hong Kong, Macau and Taiwan)’s commercial vehicle intelligent driving
market was relatively fragmented as of December 31, 2024, with many players still in the stages of
exploring technological breakthroughs and accumulating data. We primarily compete with existing
companies and new entrants in the autonomous driving, V2X and intelligent perception sectors.
Some leading companies are actively expanding into various application scenarios to achieve
large-scale commercialization.
According to CIC, we ranked sixth among all commercial vehicle intelligent driving
companies in China (including Hong Kong, Macau and Taiwan), with a market share of
approximately 5.2%. Additionally, we were one of the earliest companies to achieve
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commercialization in China (including Hong Kong, Macau and Taiwan)’s commercial vehicle
intelligent driving market. We were the third largest autonomous mining technology company in
China (including Hong Kong, Macau and Taiwan) in terms of revenue in 2024.
We possess several distinctive competitive advantages, as detailed below:
(i) We adopt multi-vehicle strategies. From years of focusing on cooperative vehicle
technologies including multi-agent global planning and distributed vehicle systems, we
have a better understanding of the complex traffic strategies required in a variety of
mining operations. Thus, our driverless vehicles can handle more complex scenarios
such as multi-vehicle sequential vehicle loading, coordinated parking, automated
scheduling for battery charging/swapping in one integrated solution. Due to the
high-level of demonstrable intelligence, our vehicles can rapidly deploy with existing
human fleets without requiring specific mine-site design or operational restrictions on
routes or work surfaces. Accordingly, we were one of the first to deploy
mixed-operation fleets in such a large mixed driving scenario working in tandem with
other vehicle fleets;
(ii) We have stronger experience in heavy-vehicle control, such as in control strategies for
hydraulic systems, as well as drive-by-wire of heavy machinery including excavators.
This is evident from the wider range of vehicles we have worked with and our IP
portfolio in mechatronics. As a result, our driverless vehicles can execute precision
control strategies, such as obstacle overtaking, more accurately and precisely with fewer
errors, requiring fewer human interventions. For moving obstacles, we can overtake
those moving obstacles traveling up to 15km/h;
(iii) Our perception systems generally exhibit better reliability and accuracy. This superiority
is evident from our ability to pass the SIL4 certification for our railway perception
system, which uses common perception architecture and sensor fusion strategies to our
driverless mining offering. Our perception systems are able to detect 10x10cm rocks
from 40 meters away, and have planning and control systems react in time for clearing
or overtaking without stoppage;
(iv) Based on the aforementioned advantages, we offer a comprehensive technology portfolio
covering autonomous driving, V2X and intelligent perception, which connects us with
customers across the entire value chain of the commercial vehicle industry and provides
opportunities for cross-domain technological advancement and business development.
Meanwhile, the synergy among our three product lines further strengthens our resilience
to market fluctuations and supports our sustainable growth;
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(v) We have accumulated industry-leading advantages and extensive practical experience
through large-scale projects, demonstrating strong project execution capabilities and
establishing a solid foundation for continued technological innovation, scalable
deployment and customer trust. At the same time, we achieved commercialisation earlier
in the industry, accumulating extensive real-world operational experience to deliver
more mature and reliable solutions for our customers; and
(vi) Most of our integrated systems are developed in-house, including V2X hardware and
software, as well as the excavator teleoperation solution. This high level of internal
development ensures better system integration, providing a more seamless technical
experience for our customers and improving both delivery efficiency and operational
performance. Meanwhile, during the Track Record Period, our revenue was primarily
derived from product sales. This asset-light business model enables rapid replication and
expansion with high capital efficiency. Under our product sales model, we may be
required to provide various financial assistance (e.g., offering guarantees for financial
leases, granting extended payment terms) to obtain orders from customers. During the
Track Record Period, we provided a guarantee of RMB2.0 million for Customer Y and
Customer Z, a guarantee of RMB70.0 million for the debt owed by Customer K, loans
of RMB13.1 million and a deposit of RMB15.2 million for Customer K. We also granted
24-month credit terms and monthly installment payment arrangements to Customer M
and Customer P.
Although closed environments are ideal for the early testing and deployment of intelligent
driving technology, transitioning to the commercial vehicle intelligent driving market presents
significant challenges for companies originally focused on passenger vehicles. Commercial vehicle
intelligent driving requires more sensor strategies, stricter motion control validation, and robust
reliability under harsh operating conditions. See “Industry Overview.”
We believe that we are strategically well-positioned in our market, and we compete favorably
with others based on our comprehensive technological prowess, advanced in-house R&D
capabilities, strong ecosystem partnerships and commercialization capabilities to attract and retain
customers and expand our market share.
DATA SECURITY AND PRIV ACY
We consider data security and protection crucial to our operations. We established a
comprehensive set of policies and procedures to guide and regulate our data security management.
By adhering to internal control measures, efficiency prioritization, full participation and
closed-loop management, we aim to meet our own data security needs, and comply with laws,
regulations and contractual obligations. Our data protection strategies cover organizational
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security, human resources, asset management, access control, encryption and key management,
physical and environmental security, operational security, communication security, information
system development and maintenance, supplier relationship security, business continuity and
compliance management. For certain key activities, we engage professional service providers to
supervise us and ensure our compliance with data security and privacy laws.
We cooperate with a service provider with surveying and mapping qualifications, who would
provide solutions for the transmission, storage, use, and other processing activities of the
geospatial data in order to meet our business needs and to ensure compliance with relevant laws
and regulations.
Our products collect data necessary for project operation and transmits it to a cloud platform
for processing. Such data includes, but is not limited to, personal information of the end-users of
the products. All cloud platforms developed and delivered for our projects are locally deployed on
the customer’s own server. We may remotely access and process data on the cloud platforms for
operation and maintenance purposes based on customer authorization. We do not collect or store
any data from the cloud platforms.
We established an information security management committee at the senior management
level as the highest authority to ensure our information security management system aligns with
mainstream information security standards. Our IT asset management department provides
resources and technical support for data security. At departmental level, we set up an information
security task force to ensure proper identification and classification of data assets, as well as
departmental-level data security audits and internal controls.
As advised by our PRC legal adviser as to data security laws, during the Track Record Period
and up to the Latest Practicable Date, we have complied with the currently effective and applicable
PRC laws on cybersecurity and data security in all material respects.
SALES AND MARKETING
We adopt a direct sales model. Our sales efforts are centered on the needs of our customers.
As of June 30, 2025, our sales team consisted of 40 employees with extensive industry experience
and in-depth expertise of our products and solutions. We have established sales offices in major
cities in mainland China, including Changsha, Chongqing and Chengdu.
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Pricing
We have a pricing management mechanism in place, pursuant to which the marketing
department must refer to the pricing guidelines provided by various business units when making
pricing proposals to customers. After negotiations with customers regarding our products and
solutions, the pricing terms will be submitted to management for review and approval.
We price our products and solutions considering a variety of factors. We implement diverse
pricing strategies for each of our products and solutions, tailored to various types of customers,
application scenarios and strategic considerations for our future business growth. We primarily
consider the functionalities of the products or solutions offered, the quantity, type and complexity
of the hardware, software provided and technologies provided or used, procurement costs and
value created for our customers when determining the prices. We also take into consideration the
overall market conditions and competitive landscape.
In our intelligent driving business, customers procure mining trucks of different
specifications, other subsystems and hardware equipment, based on their operational requirements.
We price different products under the same project separately. The pricing of our mining trucks
varies according to factors such as power source, load capacity, cargo volume and battery capacity.
In 2022, 2023, 2024 and the six months ended June 30, 2025, the average selling price of our
autonomous mining truck was RMB1.6 million, RMB2.1 million, RMB2.4 million and RMB2.1
million, respectively. For our V2X business, the highly customized nature of our products and
solutions, tailored to specific project requirements, and our offerings ranging from single devices
to various combinations of software and hardware, result in significant variability in average
selling prices during the Track Record Period. Depending on the diverse requirements of our
customers for functionality, the average selling price of our TAPS ranged from RMB100,000 to
RMB430,000 during the Track Record Period, with its average selling price being nil, RMB127.5
thousand, RMB412.3 thousand and nil in 2022, 2023, 2024 and the six months ended June 30,
2025, respectively. The average selling price of our in-vehicle intelligent management solution was
nil, RMB6.0 thousand, RMB7.5 thousand and RMB8.0 thousand during the respective years.
Marketing
Our marketing department is responsible for enhancing our brand awareness and promoting
our new and existing products and solutions. As we build a global brand associated with
technology-driven innovation, we employed a comprehensive marketing and branding strategy by
utilizing various channels to highlight the technical advancements and advantages of our products
and solutions and reach potential customers. This includes participating in exhibitions and offline
events to directly interact with target customers and gather market feedback, leveraging online
marketing strategies such as showcasing our technology and success cases on our website, social
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media engagement to attract potential clients and publishing articles about technological
innovations in our industries, and fostering partnerships with key industry players to jointly
promote our products and solutions. As a supplement to our own sales and marketing efforts, we
sometimes engage third parties for business development services to assist us in expanding market
reach and acquiring customers as we are still in the early stages of commercialization.
CUSTOMERS
Autonomous Driving
We primarily supply our intelligent driving products to (i) mine owners, their general
contractors and subcontractors, as well as operators of industrial parks, and (ii) automotive OEMs,
which primarily include major domestic heavy truck and mining truck manufacturers. During the
Track Record Period, we offered these products through three main approaches: (i) the
METAMINE solution that includes our driverless mining trucks and other subsystems; (ii) the
autonomous truck system and the central dispatch platform; and (iii) standalone sales of the central
dispatch platform, which is capable of operating independently of our autonomous truck system.
During the Track Record Period, we recorded payments made on behalf of one of our intelligent
driving customers, which mainly represented payments made by us at its request for the purchase
of certain project related ancillary products and services from third-party suppliers on its behalf,
primarily including intelligent driving related hardware. Our payments on behalf of customers
were aimed at providing administrative convenience for the end customers and reducing their
communication costs with multiple suppliers. We recognized revenue on a net basis for such
purchases we initiate on behalf of customers. According to CIC, such arrangements is in line with
industry norm. See “Financial Information — Discussion of Key Items of Consolidated Statements
of Financial Position — Prepayments and Other Receivables, Current Portion.”
The salient terms of our standard sales agreements for the intelligent driving products and
solutions during the Track Record Period are set out below:
 Product and solution specifications. Our customers typically set forth specific product
and solution specification requirements for products and solutions ordered, such as
name, model, configuration and features.
 Payment. We accept various payment options to facilitate sales of our products and
solutions. Customers are typically required to make advance payments and make
progress payments as stipulated in the agreements. Our customers are typically entitled
to retain 10% of the total contract value as retention fee, which will be paid to us at the
end of the warranty period or as otherwise agreed in the agreements. We may enter into
finance leasing agreements with financial leasing companies and our customers who
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need financing for their purchase. Under the finance leasing arrangement, the financial
leasing companies are obligated to make payments when the customers accept our
products and solutions and issue the notice of payment.
 Delivery and transfer of risks. We are generally responsible for delivering the products
to locations designated by the customers in accordance with the delivery schedule
specified in the agreement. The risks transfer to customers after they confirm acceptance
of our products.
 Acceptance. The acceptance procedures for hardware and software products are
conducted separately. We are obligated to replace or repair when the product
specifications do not meet contractual agreements. The acceptance outcomes of
hardware products and software products shall be considered independently and shall
not influence each other.
 Warranty. We provide different warranty periods for our hardware products based on
product type, and a life-long warranty period for the software products within its
lifecycle. During the warranty period, we are responsible for the product repair and
replacement.
V2X Products and Solutions
Our V2X products and solutions are primarily used by (i) companies engaging in the
construction and operation of V2X solutions and intelligent transportation, (ii) automotive OEMs
responsible for the pre-assembly of intelligent hardware in smart vehicles, and (iii) research
institutes focused on V2X technologies for educational demonstration projects. We provide
hardware products driven by our proprietary algorithms and deployed on vehicles and roadside,
along with our cloud platform that integrates diverse traffic management systems, forming a
comprehensive solution for intelligent transportation. We primarily facilitate the integration of
V2X products and in-vehicle software for automotive OEMs, enhancing vehicles’ ability to interact
and share information with the external environment. We also offer intelligent connected
transportation testing environments to support the R&D and validation of their products.
In 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025, the value of V2X
contracts we entered into was RMB74.0 million, RMB66.2 million, RMB45.0 million, RMB26.4
million and RMB5.9 million, respectively. During the Track Record Period, we recorded payments
made on behalf of certain of our V2X customers, which mainly represented payments made by us
at their request for the purchase of certain project related ancillary products and services from
third-party suppliers on their behalf, primarily including software development services. Our
payments on behalf of customers were aimed at providing administrative convenience for the end
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customers and reducing their communication costs with multiple suppliers. We recognized revenue
on a net basis for such purchases we initiate on behalf of customers. According to CIC, such
arrangements is in line with industry norm. See “Financial Information — Discussion of Key Items
of Consolidated Statements of Financial Position — Prepayments and Other Receivables, Current
Portion.”
The salient terms of our standard sales agreements for the V2X products and solutions during
the Track Record Period are set out below:
 Product and solution specifications. Our customers typically set forth specific product
and solution specification requirements for products and solutions ordered, such as
name, model, configuration and features.
 Ownership of data assets. All data involved in the underlying project of the agreement
is owned by the customer or the project owner. Without consent of the users, we shall
not transmit any personal private information or sensitive information to third parties.
 Payment. Customers are typically required to make advance payments as stipulated in
the agreements and make progress payments upon achieving certain major milestones of
the project. Our customers are typically entitled to retain 3% of the total contract value
as retention fee, which will be paid to us at the end of the warranty period. We also
accept payment by installment after the delivery of the projects.
 Delivery and transfer of risks. We are generally responsible for delivering the products
to locations designated by the customers in accordance with the delivery schedule
specified in the agreement. The risks transfer to customers after they confirm acceptance
of our products.
 Acceptance. Our products are inspected upon delivery. Customers have the right to
reject our products under specific circumstances, such as discovering quality issues
during the initial inspection that render the products unusable, or if the product
specifications do not meet contractual agreements. Initial acceptance is conducted after
our products and solutions are commissioned and commence operation. There typically
is a pilot phase ranging from 30 to 60 days before final acceptance. The acceptance of
our products and solutions may be subject to project owners’ acceptance of the complete
project delivered by our customers.
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 Warranty. We typically provide a two to three-year warranty period for our products and
solutions based on the type of product and solution provided. During the warranty
period, we are obligated to repair or replace our products free of charge for any product
quality issue, except for product damage caused by the customers’ improper operation.
 Confidentiality. All confidential information provided by either party shall not be
disclosed to any third party without prior written consent.
 Intellectual property rights. Based on project requirements, we may be required to
develop certain software products as part of the solutions provided. The intellectual
property rights and trade secrets arise from the underlying project of the agreement
belong to the project owner.
Intelligent Perception
Our intelligent perception solutions are primarily utilized by (i) urban rail transit operators
and providers of train and operational service solutions for public transportation and services, (ii)
companies that specialize in underground exploration equipment with stringent safety and
intelligence requirements, and (iii) automotive OEMs and companies engaged in the manufacturing
and sales of highway freight trucks, with a focus on safe transportation and intelligent fleet
management. We offer our customers both standardized factory installations and customized
aftermarket installations. We generally design, manufacture and provide customized hardware
products in accordance with the technical specifications.
The salient terms of our standard sales agreements for the intelligent perception solutions
during the Track Record Period are set out below:
 Product specifications. Our customers typically set forth the product type, specific
technical specification requirements and functions expected to be achieved.
 Delivery and transfer of risks. We are generally responsible for delivering the products
to locations designated by the customers in accordance with the delivery schedule
specified in the agreement. The risks transfer to customers after the products are
delivered to the customers’ assembly lines.
 Warranty. We typically provide a one-year warranty period for our products provided.
During the warranty period, we are obligated to repair or replace our products free of
charge for any product quality issue, except for product damage caused by the
customers’ improper operation.
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 Confidentiality. All confidential information provided by the customers shall not be
disclosed to any third party without prior written consent.
 Intellectual property rights. The intellectual property rights arising from the underlying
project of the agreement are jointly held by us and our customers.
Finance Lease Arrangements
We sometimes may partner with financial leasing companies to offer alternative financing
solutions to customers who require assistance with their capital needs. Our selection of financial
leasing partners is based on several criteria, including: (i) their experience with lease transactions
in our industry, (ii) their licenses and qualifications, (iii) the terms they provide to our customers
and (iv) their ability to offer timely financial support. During the Track Record Period, we entered
into such arrangements for certain customers of our METAMINE solution. The financial leasing
companies we partnered with were all independent third parties who were recommended to us by
our shareholders or customers.
During the Track Record Period, we entered into finance lease arrangements with reputable
companies specializing in financing and leasing services within the PRC. Under the standard
finance lease arrangement entered into by our financial leasing partner, our customer and us, the
financial leasing company retains legal ownership of the product or solution until the customer
fully repays the loan. During the Track Record Period, we provided guarantees under finance lease
arrangements for three customers. Except for Customer K, as informed by the lessor, the other two
customers have fully settled all their outstanding obligations under the finance lease arrangements
on schedule in August 2025, and as of the Latest Practicable Date, we had not been required to
perform any guarantee obligations. Such arrangement is consistent with common industry practice,
according to CIC. Our commercial rationale behind such arrangements is to receive the proceeds
upfront and reduce the risk of non-payment by customers when purchasing our products. Without
the finance lease arrangements, certain customers would opt for installment payments instead,
which could typically stretch the period of revenue recognition up to three years or more, where
we believe the risk of non-payment is typically not lower than that of us acting as guarantor. We
have a comprehensive decision-making process for determining the amount of guarantee we
provide and customers we act as the guarantor. Such decisions are based on negotiations with
customers and financial leasing companies on an arm’s length basis, our assessment of the
customer’s default risk, our relationship with customers and in-depth risk benefit analysis. We
conduct due diligence on potential counterparties, including evaluating their qualifications,
financial stability and capacity to fulfill their obligations.
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The salient terms of such finance lease arrangement are set forth as follows:
 Financial leasing company’s obligations. The financial leasing company pays us in full
for the products and solutions selected by our customer, with the sole purpose of leasing
these products and solutions to the customer according to terms specified in the
financial leasing agreement between the financial leasing company and our customer.
 End user’s obligations. As the end user, our customer is responsible for securing the
necessary qualifications to use our products and solutions, inspect and accept our
products and solutions.
 Ownership. Financial leasing company generally acquires the ownership of our products
and solutions once it makes the payment to us or when the lease starts, until our
customer fully repays the loan.
 Guaranty. In certain circumstances where we serve as the guarantor, we assume
vicarious liability for a portion of outstanding balances owed by our customer to the
financial leasing company in the event of defaults.
Except as disclosed above, as confirmed by our Directors, we do not have any past or present
relationships (including family, employment, financing or otherwise) with the financial leasing
companies, their ultimate beneficial owners, shareholders, directors, supervisors, senior
management and their respective associates.
During the Track Record Period, we entered into finance lease arrangements with nil, two,
one and nil customers in 2022, 2023, 2024 and the six months ended June 30, 2025. As of the
Latest Practicable Date, the two customers with whom we entered into finance lease arrangements
in 2023 had fully repaid their debts. However, the customer we entered into finance lease
arrangements in 2024 is in default currently. See “— Transactions with Customer K.” Revenue
derived from transactions with finance lease arrangements amounted to nil, RMB8.9 million,
RMB153.4 million, RMB152.3 million and nil in 2022, 2023, 2024 and the six months ended June
30, 2024 and 2025, respectively, accounting for nil, 6.7%, 37.1%, 58.9% and nil of our total
revenue during the respective periods. The total outstanding balances owned by the relevant
customers to the financial leasing companies to which we had provided guarantees as of December
31, 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025 amounted to nil, RMB7.3
million, RMB141.1 million, RMB174.8 million and RMB106.2 million, respectively, and our
maximum financial exposure arising therefrom amounted to nil, RMB2.0 million, RMB72.0
million, RMB72.0 million and RMB70.7 million as of the same dates, respectively. As of
December 31, 2022, 2023, 2024, June 30, 2025 and September 30, 2025, we recorded financial
guarantee contracts liabilities of nil, RMB0.2 million, RMB6.5 million, RMB50.5 million and
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RMB50.5 million, respectively. Such financial guarantee contracts liabilities reflects a conservative
financial approach where provisions are made based on the anticipation of fulfilling guarantee
obligations considering the risk of customer default. See “Risk Factors — Risks Relating to Our
Financial Condition and Need for Additional Capital — We are subject to risks associated with
certain finance lease arrangements, which may cause material and adverse effect on our financial
condition and operational results.”
Major Customers
Our major customers include mine owners and operators, government entities and
universities, commercial vehicle manufacturers, and other corporate customers. Commercial
vehicle manufacturers primarily purchase our products and solutions for integration into their own
offerings, while certain manufacturers may acquire them for self-use in specific projects. We
expand our customer base through various channels. During the Track Record Period, we primarily
engaged with our five largest customers of each of the year/period during the Track Record Period
through public bidding and tendering, proactive outreach by our sales personnel based on
customers’ business scope and market position, participation in trade shows and industry
conferences, and referrals from existing customers and suppliers. Revenue generated from our each
largest customer for the years ended December 31, 2022, 2023, 2024 and the six months ended
June 30, 2025 accounted for 78.4%, 31.2%, 37.4% and 46.7%, respectively, of our revenue during
those years. Revenue generated from our five largest customers of each of the year/period during
the Track Record Period for the years ended December 31, 2022, 2023, 2024 and the six months
ended June 30, 2025 accounted for 96.7%, 64.1%, 80.0% and 94.1%, respectively, of our revenue
during those years.
Our five largest customers of each of the year/period during the Track Record Period serve a
diverse range of downstream customers, including contractors for mining projects, companies
specializing in rail transit and intelligent transportation, intelligent driving and automotive
companies.
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For the year ended December 31, 2022
Customer Products/solutions sold Customer background
Revenue
(RMB’000)
% of total
revenue
Y ear of
commencing
business
relationship
Typical
credit terms
Customer A ..... Autonomous driving
— METAMINE
solution
Founded in 2007 and registered in Hong
Kong, Customer A primarily engages
in the production of cement and
cement products, as well as the
operation of port facilities for cargo
handling and storage.
24,342 78.4 2020 0 to 30
days
(stage
payment)
Customer B ..... Autonomous driving
— METAMINE
solution
Founded in 2019 and registered in
Hunan, Customer B primarily engages
in the development and production of
advanced materials and technologies
for various industrial applications.
Customer B purchases our products to
incorporate into its dispatch systems,
which are subsequently supplied to its
downstream customers for mining
operations.
2,750 8.9 2021 7 to 15
days
(stage
payment)
Customer C ..... V2X Founded in 2013 and registered in
Beijing, Customer C primarily engages
in the design, research and system
integration of embedded computing
solutions.
1,496 4.8 2020 Advance
receipt
(stage
payment)
Customer D ..... V2X Founded in 2019 and registered in
Hunan, Customer D primarily engages
in the development and application of
intelligent driving technologies and
solutions.
1,032 3.3 2020 10 to 30
days
(stage
payment)
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Customer Products/solutions sold Customer background
Revenue
(RMB’000)
% of total
revenue
Y ear of
commencing
business
relationship
Typical
credit terms
Customer E ..... Autonomous driving
— closed-
environment
autonomous
logistics truck
solution
Founded in 2022 and registered in
Shanghai, Customer E primarily
engages in the development and
provision of intelligent sanitation
solutions and services.
404 1.3 2022 5 days
(stage
payment)
For the year ended December 31, 2023
Customer Products/solutions sold Customer background
Revenue
(RMB’000)
% of total
revenue
Y ear of
commencing
business
relationship
Typical
credit terms
Customer F ..... Autonomous driving
— METAMINE
solution
Founded in 2020 and registered in
Hubei, Customer F is an automotive
OEM that primarily engages in the
R&D, design, production and sales of
automobiles and automotive parts.
Customer F purchases and further sells
our products to be utilized for
autonomous haulage and logistics at
the mining site for an autonomous
mining project.
41,382 31.2 2023 80 to 180
days
(stage
payment)
Customer G ..... V2X Founded in 2005 and registered in
Beijing, Customer G primarily
engages in the development and
provision of location-based services
and intelligent transportation solutions.
15,052 11.4 2022 7 to 30
days
(stage
payment)
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Customer Products/solutions sold Customer background
Revenue
(RMB’000)
% of total
revenue
Y ear of
commencing
business
relationship
Typical
credit terms
Customer H ..... Intelligent perception
— Intelligent
perception
solutions for
commercial
vehicles
Founded in 2009 and registered in
Shandong, Customer H is an
automotive OEM that primarily
engages in the manufacturing of a
wide range of industrial equipment.
Customer H purchases our products to
further sell to its customers.
11,691 8.8 2021 30 to 120
days
(bullet
payment)
Customer I ..... Intelligent perception
— Autonomous
perception systems
for rail transit
Founded in 1995, registered in
Shenzhen, and listed on both the Hong
Kong Stock Exchange and Shenzhen
Stock Exchange, Customer I is an
automotive OEM that primarily
engages in the manufacturing of
automobiles, rechargeable batteries
and new energy solutions. Customer I
purchases our products to incorporate
into its own products.
8,541 6.4 2021 30 days
(bullet
payment
for
products
sales and
stage
payment
for
technical
services)
Customer J ..... V2X Founded in 2010 and registered in
Jiangsu, Customer J primarily engages
in the development and provision of
comprehensive IoT solutions along
with supporting software and
hardware.
8,373 6.3 2019 7 days
(stage
payment)
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For the year ended December 31, 2024
Customer Products/solutions sold Customer background
Revenue
(RMB’000)
% of total
revenue
Y ear of
commencing
business
relationship
Typical
credit terms
Customer K ..... Autonomous driving
— METAMINE
solution
Founded in 2021 and registered in
Anhui, Customer K primarily provides
engineering technical services and
engages in the design and execution of
construction projects. As a contractor
for a mining project, Customer K
procured our products for its mining
operations. Customer K is not a
state-owned enterprise.
153,361 37.4 2023 Advance
receipt
(bullet
payment)
Customer L ..... V2X Founded in 2019 and registered in
Chongqing, Customer L primarily
engages in investment, property
management, real estate development
and property leasing. Customer L
purchases our V2X products and
solutions for deployment within the
urban innovation pilot zone it
operates.
60,133 14.7 2020 14 days
(stage
payment)
Customer F ..... Autonomous driving
— METAMINE
solution
Please see above. 45,295 11.0 2023 80 to
180 days
(stage
payment)
Customer H ..... Intelligent perception
— In-vehicle
intelligent
perception and
safety management
solution
Please see above. 44,694 10.9 2021 30 to
120 days
(bullet
payment)
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Customer Products/solutions sold Customer background
Revenue
(RMB’000)
% of total
revenue
Y ear of
commencing
business
relationship
Typical
credit terms
Customer A ..... Autonomous driving
— METAMINE
solution
Please see above. 24,448 6.0 2020 0 to
30 days
(stage
payment)
For the six months ended June 30, 2025
Customer Products/solutions sold Customer background
Revenue
(RMB’000)
% of total
revenue
Y ear of
commencing
business
relationship
Typical
credit terms
Customer M ..... Autonomous driving
— METAMINE
solution
Founded in 2018 and registered in Inner
Mongolia, the company primarily
engages in mining and construction
services.
190,646 46.7 2024 24-month
(monthly
installment)
(1)
Customer N ..... Autonomous driving
— METAMINE
solution
Founded in 2023 in Inner Mongolia, the
company primarily engages in
construction engineering and
infrastructure development.
81,174 19.9 2025 45 days
(stage
payment)
Customer O ..... Autonomous driving
— METAMINE
solution
Founded in 2010 and registered in
Northwest China, the company
primarily engages in blasting
engineering and hazardous materials
transport.
78,752 19.3 2024 10−20 days
(stage
payment)
Customer H ..... Intelligent perception
— Intelligent
perception
solutions for
commercial
vehicles
Founded in 2009 and registered in
Shandong, the company primarily
engages in the manufacturing of a
wide range of industrial equipment,
with a registered capital of
RMB3,000.0 million.
18,209 4.5 2021 120 days
(bullet
payment)
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Customer Products/solutions sold Customer background
Revenue
(RMB’000)
% of total
revenue
Y ear of
commencing
business
relationship
Typical
credit terms
Customer P ..... Autonomous driving
— METAMINE
solution
Founded in 2023 and registered in
Northwest China, the company
primarily engages in construction and
demolition services.
15,199 3.7 2024 24-month
(monthly
installment)
(1)
Note:
(1) To facilitate our market expansion while addressing the substantial upfront costs typically associated with
autonomous mining products and solutions projects, we have agreed with Customer M and Customer P on a
24-month installment payment arrangement. According to CIC, the aforementioned payment arrangement is not
unusual in the industry.
As of the Latest Practicable Date, none of our Directors, their associates or any of our
shareholders (who owned or to the knowledge of Directors had owned more than 5% of our issued
share capital) had any interest in any of our five largest clients of each of the year/period during
the Track Record Period.
During the Track Record Period, our customer concentration increased primarily due to (i)
the project-based nature of our business, (ii) high-value orders for intelligent driving projects, and
(iii) strategic cooperation with major customers who were early adopters in the mining industry’s
shift towards intelligent autonomous operations. Our first-mover and technological advantages,
validated through extended validation periods, strengthened these relationships, resulting in
increased sales volume and heightened customer concentration. Despite this concentration, we
maintained a broad customer base, serving over 100 customers during the Track Record Period.
Our major customers vary each year as once a project concludes, customers may not require
further services until new needs arise, leading to a turnover of customers each year.
Transactions with Customer K
Founded in 2021 and registered in Anhui, Customer K primarily provides engineering
technical services and engages in the design and execution of construction projects. As a
contractor for a mining project, Customer K procured our products for its mining operations.
In 2023, we provided our METAMINE solution to Customer K for an autonomous mining
project at a large coal mine in Northwest China, with a contract value of RMB175.4 million
(inclusive of tax). We made a deposit payment of RMB15.2 million, as required by the customer,
to demonstrate our capability to fulfill contract obligations. The payment aligns with existing
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commercial practice in the industry, according to CIC. In 2024, we recorded revenue of RMB152.3
million for the project. See “— Our Offerings — Our Major Projects.” As Customer K purchased
our solution through a finance lease arrangement, the financial leasing company required us to
provide a guarantee of RMB70.0 million for the debt owed by Customer K. Consequently, our
maximum financial exposure from this finance lease arrangement as of June 30, 2025 was
RMB70.0 million. See “— Customers — Finance Lease Arrangements.”
Additionally, pursuant to the mine owner’s requirement for prompt commencement of
operations due to the significant demand for mining and waste transportation, we extended loans to
Customer K in 2023 and 2024 for the procurement of auxiliary equipment necessary for
transportation operations, considering it set the record for (i) the world’s largest driverless mining
fleet operating with manned vehicles, and (ii) the world’s largest mixed-operation mining fleet, as
of the Latest Practicable Date, according to CIC. According to CIC, due to the substantial
equipment and transportation requirements of large-scale mining projects, there were incidences of
suppliers providing financial support to mine operators to facilitate project execution. The total
principal amount of the loans, as well as our maximum financial exposure as of June 30, 2025,
amounted to RMB12.4 million. Due to the adverse effect of extreme rainfall since June 2024 on
safe production conditions at the mining site, the operation of the project was temporarily
suspended. Under these exceptional circumstances, we and Customer K entered into a
supplementary agreement in August 2024, pursuant to which the principal amount will be
repayable in December 2025, with interest. See “Financial Information — Discussion of Key Items
of Consolidated Statements of Financial Position — Prepayments and Other Receivables, Current
Portion.” During the Track Record Period, we did not have any similar loan arrangements with
other customers. In furtherance of our cooperation with Customer K, we provided auxiliary
infrastructure and recorded revenue of RMB1.1 million for the sales in 2024.
As informed by the financial leasing company, since July 23, 2025, Customer K has been in
default with respect to certain payment obligations under its finance lease agreement with the
financial leasing company. To the best of our knowledge, Customer K’s default primarily resulted
from Customer K’s client being responsible for obtaining the necessary approvals for the new
mining faces, which had not been secured as of the Latest Practicable Date. Consequently,
Customer K was unable to commence mining on the new faces as initially planned and did not
achieve the expected business volume, thereby resulting in some liquidity pressure. As of the
Latest Practicable Date, the operation and production of Customer K’s autonomous mining project
on its existing mining faces continued.
The lessor asserted the corresponding liability to us on a monthly basis from July 2025.
According to the finance lease arrangements, Customer K is obligated to make monthly payments
to the lessor starting from April 2024. As informed by the lessor, Customer K has paid 15 finance
lease installments to the lessor, starting with the first installment in April 2024 as stipulated in the
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contract, and continuing through June 2025. As of the Latest Practicable Date, we have fulfilled
our guarantee obligations for the months of July to October in 2025 with payments of RMB19.2
million in total, as required by the lessor, and we had outstanding guarantee obligations amounting
to RMB50.8 million that have not yet been fulfilled. We may be required to assume such
obligations on a continuing monthly basis over the next eleven months. However, the specific
payment schedule is beyond our control and will be determined in accordance with the lessor’s
collection arrangements. The specific circumstances will depend on the financial condition of
Customer K, the operational performance of its projects, and the results of subsequent discussions
with the lessor. As of the Latest Practicable Date, Customer K did not make any payment to us.
We are also actively pursuing collection from Customer K and have issued a demand letter, while
continuing to engage with the Customer K to seek the resolution of the outstanding balance.
As of June 30, 2025, the amount of impairment losses made in respect of transactions with
Customer K was RMB70.6 million, representing an impairment ratio of 71.8% for the financial
guarantee contract liabilities and other receivables arising from Customer K. As of June 30, 2025,
we have not recognized a full impairment loss in respect of the other receivables and financial
guarantee contract exposure related to Customer K. This is primarily because, as of the Latest
Practicable Date, the operation and production of Customer K’s autonomous mining project on its
existing mining faces continued. Furthermore, as Customer K is not subject to any bankruptcy or
insolvency proceedings, we do not assess its current default to be permanent. Therefore, we
consider that there is recoverable value in this exposure, and we have not made a full provision for
impairment loss. We adopt the general approach under the Expected Credit Loss (“ ECL”) model
for impairment accounting for other receivables and financial guarantee contracts. According to the
valuation report, the ECL is primarily calculated based on the Probability of Default (“ PD”) and
the Loss Given Default (“ LGD”). Given Customer K has been in default with respect to certain
payment obligations under its finance lease agreement with the financial leasing company, the PD
is set at 100% in the ECL model. The LGD was calculated based on “1 — Recovery Rate upon
Default,” and we use the average corporate debt recovery rate data published in Moody’s Investors
Service’s 2023 Default Study as the best estimate for the recovery rate upon default. Accordingly,
we have recognized impairment provisions for the relevant exposures, and we consider the
provision for impairment for other receivables and financial guarantees related to Customer K to
be sufficient. The following table sets forth the movements in the amounts and provisions for
impairment (i) related to receivables from Customer K and (ii) under the financial guarantee
contract with Customer K during the Track Record Period and up to the Latest Practicable Date.
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As of June 30, 2025
Amount
Provision for
impairment Net balance Impairment ratio
Subsequent
settlement up to
30 September
2025
Subsequent
settlement up to
Latest Practicable
Date
(RMB in million, except percentage)
Receivables
Loan .......... 13.1 9.3 3.8 71.0% nil nil
Others ......... 16.4 10.9 5.5 66.2% nil nil
Maximum
financial
exposure
Provision for
impairment
Remaining
financial
exposure Impairment ratio
Guarantee
obligations
fulfilled up to
September 30,
2025
Guarantee
obligations
fulfilled up to
Latest Practicable
Date
(RMB in million, except percentage)
Financial guarantee
contract ....... 70.0 50.5 19.5 72.1% 9.6 19.2
As of December 31, 2024
Amount
Provision for
impairment Net balance Impairment ratio
Subsequent
settlement up to
30 September
2025
Subsequent
settlement up to
Latest Practicable
Date
(RMB in million, except percentage)
Receivables
Loan .......... 12.9 3.4 9.5 26.2% nil nil
Others ......... 16.4 4.1 12.3 24.7% nil nil
Maximum
financial
exposure
Provision for
impairment
Remaining
financial
exposure Impairment ratio
Guarantee
obligations
fulfilled up to
September 30,
2025
Guarantee
obligations
fulfilled up to
Latest Practicable
Date
(RMB in million, except percentage)
Financial guarantee
contract ....... 70.0 6.3 63.7 9.0% 9.6 19.2
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As of December 31, 2023
Amount
Provision for
impairment Net balance Impairment ratio
Subsequent
settlement up to
30 September
2025
Subsequent
settlement up to
Latest Practicable
Date
(RMB in million, except percentage)
Receivables
loan ........... 9.9 0.2 9.7 2.2% nil nil
Given that (i) as of June 30, 2025, we have recognized relevant impairment losses to reflect
the relevant risk, (ii) we maintain sufficient liquidity reserves for ongoing operations, and (iii) our
business model and revenue streams are diversified across multiple customers and projects, and we
are also actively working to diversify our customer base further, reducing reliance on any single
customer, we believe the aforementioned default does not have a material adverse impact on our
business, financial condition, results of operations or liquidity. Meanwhile, apart from the
aforementioned agreements, including the sales agreement, the deposit agreement, the loan
agreement and finance guarantee agreement, we have no other contractual arrangements with
Customer K. Accordingly, we do not expect that we will be subject to any additional legal or
financial liabilities in connection with the sales to Customer K.
SUPPLIERS
We typically engage reputable suppliers to ensure the quality of our products. The factors that
may affect our selection mainly include technological expertise, product quality, qualifications and
credentials, market reputation and price. We usually select suppliers who have demonstrated a
track record of stable supply and profitability.
In addition to vetting new suppliers, we also conduct yearly evaluations of existing suppliers
and require suppliers to promptly address any issues discovered during such evaluations. We
provide guidance to suppliers when necessary and may terminate suppliers who continuously fail
to meet our standards.
Raw Materials and Components
We engage third-party suppliers for key components and materials for our products and
solutions including mining trucks, semiconductor chips, radar, LiDAR, and cameras and other
components and materials. The raw materials and components procured from third-party suppliers
undergo our internal assembly processes to form our products and solutions or are supplied to our
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contract manufacturers for the production of our products and solutions. See “— Manufacturing —
Contract Manufacturers.” During the Track Record Period, we were not subject to shortages in the
supply of raw materials from our major suppliers.
We typically enter into supply agreements with suppliers, the salient terms of which are set
out below:
 Product specifications. The product name, specification, price, quantity, delivery
timeline and other detailed items are specified in the agreements.
 Payment and delivery. We are responsible for timely payment to suppliers, who are
responsible for delivery of products to our designated location specified in the
agreements.
 Quality control. Suppliers shall ensure that the products provided are brand new and
unused products. The quality requirements must meet national, industry and mutually
agreed standards. Upon delivery, a quality assurance certificate recognized by us shall
be provided. We have the right to reject and return any products that do not meet our
requirements, at the expense of suppliers, or to request free product replacement or
maintenance.
 Transfer of risk. The risk transfers to us after delivery.
 Quality Guarantee. Suppliers offer varying warranty periods based on the product type.
During the warranty period, suppliers are responsible for after-sales maintenance costs.
Suppliers must replace the products free of charge if they encounter two major quality
issues or if any components are damaged due to quality problems. We reserve the right
to return the product if suppliers fail to address issues promptly and lead to serious
consequences.
 Confidentiality. All confidential information provided by either party shall be used
solely for the purposes of cooperation pursuant to the agreements and shall not be
disclosed to any third party without prior written consent.
 Termination. The agreements will be terminated by mutual agreement, or by other
means as set forth in the agreements.
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Major Suppliers
Our major suppliers primarily include technology and machinery companies during the Track
Record Period. Charges from our largest supplier of each of the year/period during the Track
Record Period for our key business operations for the years ended December 31, 2022, 2023, 2024
and the six months ended June 30, 2025 accounted for 18.0%, 32.9%, 44.3% and 45.0%,
respectively, of our total purchase amount during those years. Charges from our five largest
suppliers of each of the year/period during the Track Record Period for our key business
operations for the years ended December 31, 2022, 2023, 2024 and the six months ended June 30,
2025 accounted for 35.6%, 47.9%, 59.2% and 84.1%, respectively, of our total purchase amount
during those years.
For the year ended December 31, 2022
Supplier Products/services purchased Supplier background
Purchase
amount
(RMB’000)
% of total
purchase
amount
Y ear of
commencing
business
relationship
Typical
credit terms
Supplier A .. Drive-by-wire-controlled
mining trucks
Founded in 2004,
registered in Liaoning
and listed on the Hong
Kong Stock Exchange,
Supplier A primarily
engages in the
manufacturing of heavy
machinery and
equipment for mining
and logistics industries.
24,241 18.0 2022 30 days
(stage
payment)
Supplier B .. Rent and utility Founded in 2016 and
registered in Hunan,
Supplier B primarily
engages in real estate
development and
operation, property
management and
leasing.
7,203 5.3 2018 Prepaid
(monthly
installment)
Supplier C .. IC, modules, etc. Founded in 2005 and
registered in Shanghai,
Supplier C primarily
provides information,
communication,
consumer products and
semiconductor products.
6,498 4.8 2022 0 days
(bullet
payment)
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Supplier Products/services purchased Supplier background
Purchase
amount
(RMB’000)
% of total
purchase
amount
Y ear of
commencing
business
relationship
Typical
credit terms
Supplier D .. Consultancy services Founded in 2021 and
registered in Hunan,
Supplier D primarily
provides financial and
information technology
consulting services.
5,340 4.0 2022 3 days
(bullet
payment)
Supplier E .. Testing service Founded in 2020 and
registered in Hunan,
Supplier E primarily
operates in the
professional technical
services industry.
4,717 3.5 2021 Prepaid
(stage
payment)
Total 47,999 35.6
For the year ended December 31, 2023
Supplier Products/services purchased Supplier background
Purchase
amount
(RMB’000)
% of total
purchase
amount
Y ear of
commencing
business
relationship
Typical
credit terms
Supplier F .. Drive-by-wire-controlled
mining trucks
Founded in 2005,
registered in Shaanxi
and listed on the
Beijing Stock Exchange,
Supplier F primarily
engages in the
manufacturing of
off-highway
transportation
equipment.
66,002 32.9 2021 Prepaid
(stage
payment)
Supplier G .. Drive-by-wire-controlled
mining trucks
Founded in 2020 and
registered in Henan,
Supplier G primarily
engages in the research,
development, and
manufacturing of
mining equipment with
a focus on new energy
mining vehicles.
11,823 5.9 2021 60 to 360
days
(stage
payment)
Supplier B .. Rent and utility Please see above. 7,295 3.6 2018 Prepaid
(monthly
installment)
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Supplier Products/services purchased Supplier background
Purchase
amount
(RMB’000)
% of total
purchase
amount
Y ear of
commencing
business
relationship
Typical
credit terms
Supplier H .. Drive-by-wire-controlled
mining trucks
Founded in 2012 and
registered in Shandong,
Supplier H primarily
provides mining
equipment, rock drilling
equipment, and other
special equipment and
parts.
5,558 2.8 2022 60 to 90
days
(stage
payment)
Supplier I .. Sales and marketing
service
Founded in 2019 and
registered in Beijing,
Supplier I primarily
operates in the
technology promotion
and application services
industry. We engaged
Supplier I for sales and
customer consultancy
services for our
autonomous mining
trucks.
5,322 2.7 2023 Prepaid
(stage
payment)
Total 96,000 47.9
For the year ended December 31, 2024
Supplier Products/services purchased Supplier background
Purchase
amount
(RMB’000)
% of total
purchase
amount
Y ear of
commencing
business
relationship
Typical credit
terms
Supplier H ... Drive-by-wire-controlled
mining trucks
Please see above. 115,469 44.3 2022 60 to 90
days
(stage
payment)
Supplier G ... Drive-by-wire-controlled
mining trucks
Please see above. 13,168 5.0 2021 60 to 360
days
(stage
payment)
Supplier J ... Sales and marketing service,
including customer referral
and recommendation
Founded in 2022 and
registered in Anhui,
Supplier J primarily
engages in civil
engineering, construction
and consultation services.
10,943 4.2 2024 1 day (bullet
payment)
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Supplier Products/services purchased Supplier background
Purchase
amount
(RMB’000)
% of total
purchase
amount
Y ear of
commencing
business
relationship
Typical credit
terms
Supplier K ... LiDAR and LiDAR repair
services
Founded in 2014, registered in
Shenzhen and listed on the
Hong Kong Stock
Exchange, Supplier K
primarily engages in the
development and production
of LiDAR solutions for
automotive, robotics and
other applications.
7,590 2.9 2017 7 to 30 days
(bullet
payment)
Supplier B ... Rent and utility Please see above 7,322 2.8 2018 Prepaid
(monthly
installment)
Total 154,492 59.2
For the six months ended June 30, 2025
Supplier Products/services purchased Supplier background
Purchase
amount
(RMB’000)
% of total
purchase
amount
Y ear of
commencing
business
relationship
Typical credit
terms
Supplier F ... Drive-by-wire-controlled
mining trucks
Founded in 2005, registered in
Shaanxi and listed on the
Beijing Stock Exchange, the
company primarily engages
in the manufacturing of
off-highway transportation
equipment, with a registered
capital of RMB452.5
million.
194,910 45.0 2021 7-90 days
(stage
payment)
(1)
Note:
(1) Although we have agreed with Supplier F on a stage payment arrangement and a credit term of 7 to 90 days, our
payments to Supplier F are conditional upon receiving the corresponding proportion of settlement payments from
our customers (the “ Contractual Arrangements ”). As of the Latest Practicable Date, certain payments to Supplier
F have not been made as scheduled due to delays in payments from relevant customers; however, we have been
actively (i) communicating with these customers to expedite payment and (ii) negotiating payment arrangements
with Supplier F, and no disputes have arisen between us and Supplier F regarding payment matters.
According to the Contractual Arrangements, if our customers fail to make payments as stipulated and Supplier F
requests us to settle the corresponding amounts, we are entitled to refuse such payment without incurring any
breach of contract liability, as the contractual conditions for payment have not been satisfied. In such
circumstances, we have no payment obligation. Supplier F is a public company listed on the Beijing Stock
Exchange, and we have maintained a long-standing and cooperative relationship with Supplier F. The mining trucks
we procure from Supplier F are primarily sold to customers with good credit profiles, which significantly reduces
the likelihood of payment default. Accordingly, we believe the risk of being held liable by Supplier F for overdue
payment obligations is low.
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Supplier Products/services purchased Supplier background
Purchase
amount
(RMB’000)
% of total
purchase
amount
Y ear of
commencing
business
relationship
Typical credit
terms
Supplier L ... Drive-by-wire-controlled
mining trucks
Founded in 2021 and
registered in Heilongjiang,
the company primarily
engages in automobile sales,
second-hand vehicle
brokerage, and vehicle
maintenance services.
147,391 34.0 2024 18-month
(monthly
installment)
Supplier M .. Consulting services Founded in 2024 and
registered in Shanghai, the
company primarily engages
in technology development
and consulting services.
10,377 2.4 2024 Subject to
the
acceptance
of projects
(stage
payment)
Supplier K ... LiDAR and LiDAR repair
services
Founded in 2014, registered in
Shenzhen and listed on the
Hong Kong Stock
Exchange, the company
primarily engages in the
development and production
of LiDAR solutions for
automotive, robotics and
other applications.
5,861 1.4 2020 7 to 30 days
(bullet
payment)
Supplier N ... Industrial control computer Founded in 2015 in Zhejiang,
China, the company
primarily engages in the
development, manufacturing
and sales of power
technology solutions,
including advanced power
systems and related
components.
5,808 1.3 2024 30 days
(bullet
payment)
Total 364,347 84.1
Given (i) the project-based nature of our business, (ii) the high average order value for the
corresponding intelligent driving projects, which resulted in a significant proportion of our annual
purchase amount being attributed to certain major projects, and (iii) our practice of engaging the
same suppliers for the same project to maintain consistency in the quality of our products and
solutions, as they are selected based on the specific needs of each project, our supplier
concentration increased during the Track Record Period, with a substantial portion of our purchase
amount attributed to our largest suppliers of each of the year/period during the Track Record
Period. During the Track Record Period, we engaged with over 300 suppliers, and our major
suppliers varied annually due to the project-based nature of our business.
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During the Track Record Period, we engaged various automotive OEMs to manufacture our
drive-by-wire-controlled mining trucks. Suppliers of drive-by-wire-controlled mining trucks are
typically selected based on their vehicle performance, market competitiveness and reputation, and
whether the OEM’s manufacturing and delivery capability can support the needs of our projects.
During the Track Record Period and up to the Latest Practicable Date, we had supplier
concentration on Supplier H, who had been the supplier of drive-by-wire-controlled mining trucks
for several of our projects. For details on the three primary ways we cooperate with automotive
OEMs, see “— Manufacturing — Our Cooperation with Automotive OEMs.” We primarily adopt
the third collaboration model with Supplier H, where we design the intelligent driving system and
provide the corresponding hardware and software to be installed on the vehicles designed and
provided by Supplier H. The increase in our purchase amount from Supplier H from 2023 to 2024
was primarily driven by an increase in our project needs. We believe that we do not have material
reliance on Supplier H given that we are confident that we would be able to switch to alternatives
suppliers in the event that we cease collaboration with Supplier H, as our intelligent driving
software and hardware are adaptable to different models of drive-by-wire mining trucks from
various automotive OEMs, and we have engaged other automotive OEMs for similar projects in
the past. During the Track Record Period and up to the Latest Practicable Date, we maintained a
stable relationship and had no material unresolved disputes or lawsuits with Supplier H.
Other than the five largest suppliers of each of the year/period during the Track Record
Period listed above, we also engaged construction and project supervision service suppliers for the
construction of our offices, buildings, facilities and equipment during the Track Record Period. In
2022, 2023, 2024 and the six months ended June 30, 2025, our total purchase amount, excluding
those from the construction and project supervision service suppliers amounted to RMB134.9
million, RMB200.7 million, RMB260.8 million and RMB433.2 million.
As of the Latest Practicable Date, none of our Directors, their associates or any of our
shareholders (who owned or to the knowledge of the Directors had owned more than 5% of our
issued share capital) had any interest in any of our five largest suppliers of each of the year/period
during the Track Record Period.
OVERLAPPING OF CUSTOMERS AND SUPPLIERS
Customer C, one of our five largest customers in 2022, was also a supplier during the Track
Record Period. Customer C contributed to 4.8%, 0.1%, nil and nil of our revenue in 2022, 2023,
2024 and the six months ended June 30, 2025 respectively, and 0.4%, 1.7%, 2.3% and 1.0% of our
total purchase amounts in the same periods, respectively. Customer C primarily engages in the
design, research and system integration of embedded computing solutions. We primarily procure
PCBA and modules from Customer C for use in our products and solutions. As a separate and
independent matter, we sold certain raw materials purchased from other third-party suppliers to
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Customer C in 2022. This was due to adjustment to the application and design of certain of our
products and solutions in 2022 which resulted in a surplus of raw materials that were no longer
best suited for our purposes. Since Customer C uses these raw materials for its business, we sold
these raw materials to Customer C at a premium to our original purchase price to recover our
costs.
Customer L, one of our five largest customers in 2024, was also a supplier in 2023 and 2024.
Customer L contributed to nil, nil, 14.7% and nil of our revenue in 2022, 2023, 2024 and the six
months ended June 30, 2025 respectively, and nil, 0.4%, 0.1% and 0.1% of our total purchase
amounts in the same periods, respectively. We primarily provide V2X products and solutions to
Customer L. As a separate and independent matter, we leased property from Customer L for our
offices because its location facilitates enhanced collaboration with potential business partners and
aids in talent acquisition.
Supplier H, one of our five largest suppliers in 2023 and 2024, was also a customer in 2024
and the six months ended June 30, 2025. Supplier H contributed to nil, 2.8%, 44.3% and nil of our
total purchase amounts in 2022, 2023, 2024 and the six months ended June 30, 2025 respectively,
and nil, nil, 3.8% and 0.0% of our revenue in the same periods, respectively. We primarily procure
drive-by-wire-controlled mining trucks from Supplier H to incorporate into our METAMINE
solution sold to our customers, see “— Suppliers — Major Suppliers.” As a separate and
independent matter, we sold intelligent driving software and hardware to Supplier H to be
incorporated in Supplier H’s mining trucks sold to its own customers.
All of our sales to and purchases from Customer C, Customer L and Supplier H were
conducted in the ordinary course of business under normal commercial terms and on arm’s length
basis.
MANUFACTURING
We engage automotive OEMs for the manufacturing of our vehicles and contract
manufacturers for the production of most of our other products and components. We procure
substantially all hardware and components used in our products from third-party suppliers. In
addition to the production conducted through the automotive OEMs and our contract
manufacturers, we also have self-operated facilities used primarily for the assembly of our V2X
devices and teleoperation station, as well as testing, calibration and packaging of certain products.
Our factory is located in Changsha and occupies approximately 2,600 square meters of space.
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Our Cooperation with Automotive OEMs
We possess the R&D capability to develop chassis for drive-by-wire-controlled vehicles,
which can be seamlessly integrated with our independently developed intelligent driving system.
Depending on project requirements (such as whether there are existing vehicle designs of
automotive OEMs on the market that meet our standards for the specific project), we collaborate
with automotive OEMs in three primary collaboration models:
 Collaboration model ①: The OEMs provide the overall vehicle design while our focus
is on the integration of intelligent driving technology. During the Track Record Period,
all autonomous mining trucks we delivered utilized this collaboration model.
 Collaboration model ②: We jointly formulate the overall vehicle design with the OEMs.
We also provide the electrification system and software. The OEMs supply the
unpowered chassis and structural components and are responsible for vehicle assembly.
During the Track Record Period, we delivered three sets of electrification system and
software under this collaboration model.
 Collaboration model ③: We are responsible for the formulation of the overall vehicle
design under this model. We also provide designs for specific structural parts and supply
key components such as electrification systems, which include the electric motor, power
battery, electronic control system, and chassis electrical systems. Our responsibilities
also encompass commissioning, which includes functional tests and quality inspections.
The OEMs primarily take charge of the vehicle assembly process. We adopted this
collaboration model for our cabless autonomous mining trucks. As of December 31,
2024, these trucks were in the testing phase while we engaged in pre-sales negotiations
with our customers.
We are responsible for the design of intelligent driving technology, providing intelligent
driving hardware and software, offering technical guidance and conducting vehicle testing under
all three collaboration models.
The following chart illustrates the three ways we cooperate with automotive OEMs.
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Design
CiDi OEM CiDi OEM CiDi OEM OEM CiDi
Overall Vehicle Design
Design
for Assembly
The Electrification Systems,
Axles, Suspension, Brackets
and Software
Auxiliary Materials
for Manufacturing
Technical
Guidance
Vehicle
Assembly
Commissioning:
Functional Tests
Performance Tests,
Quality InspectionSystem Design
for Intelligent Driving
Intelligent Driving
Hardware and Software
Overall Vehicle Design The Electrification
System and Software
Unpowered chassis,
cargo Boxes and Certain
Structural Components
Commissioning:
Functional Tests
Performance Tests,
Quality InspectionSystem Design
for Intelligent Driving
Intelligent Driving
Hardware and Software
Technical
Guidance
Vehicle
Assembly
Vehicle
Assembly
Overall Vehicle Design
The Electrification Systems,
Axles, Suspension, Brackets
and Software Commissioning:
Functional Tests
Performance Test,
Quality InspectionSystem Design
for Intelligent Driving
Vehicle
Ǻ
ǻ
Intelligent
Driving
Vehicle
Intelligent
Driving
Vehicle
Intelligent
Driving
Intelligent Driving
Hardware and Software
Technical
Guidance
Procurement Production Commissioning
Ǽ
The salient terms of our agreements with automotive OEMs are set forth as below:
 Principal rights and obligations of parties involved. The parties specify the vehicle
specifications and specific configuration requirements in the agreement, and determine
the responsibilities of each party based on the collaboration model of the project.
 Payment and delivery. We make payments to the automotive OEMs in accordance with
the payment schedule stipulated in the agreement. We may reserve a certain amount as a
warranty deposit, which will be paid to the automotive OEMs upon the expiration of the
warranty period or after the acceptance of the products, as per the agreed terms. The
automotive OEMs are responsible for delivering the final products to our designated
location.
 Intellectual Property. For projects where we formulate the design of vehicle
specifications, determine product functions, and conduct system integration, the
underlying intellectual property rights of the entire vehicle model belong to us. For
projects where we jointly formulate the overall vehicle design with the OEMs, the
underlying intellectual property rights of the components or systems developed and
designed by us are owned by us, while those developed and designed by the OEMs are
owned by them. Additionally, except for the intellectual property rights related to
pre-existing systems provided by the automotive OEMs, the intellectual property rights
of all other systems are owned by us.
 Quality assurance. Each party shall be responsible for the quality of the components it
manufactures.
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 Maintenance. Maintenance services shall be promptly provided. For certain automotive
parts sourced from third parties by the automotive OEMs, the maintenance services are
coordinated by the OEMs and provided by the manufacturers of these parts through their
local service centers. Automotive OEMs may designate service providers for the
provision of maintenance services.
 Warranty . Automotive OEMs offer warranties based on the components provided. These
warranties are either for a fixed term or until the vehicle reach a specified mileage.
 Termination. We have the right to terminate the agreement if the automotive OEMs fail
to deliver within the agreed timeframe.
We provide maintenance services and warranty periods to the end users of the vehicles, i.e.,
our customers, in accordance with our sales agreements. In the event that maintenance services for
parts and components provided by the automotive OEMs are requested by our customers, we will
promptly make requests to the automotive OEMs, who shall be responsible for the provision of
such services as stipulated in their agreements with us.
For each vehicle model, we design and customize components including sensors,
communication modules, controllers, wiring harnesses, etc., and ship to the automotive OEMs for
installation. All vehicles delivered to customers bear the brand of the respective automotive OEM,
with our logo either painted or affixed on the vehicle body. The extent and costs of customization
required to integrate our intelligent driving-related components are consistent across different
vehicle models, including new models. Except under the first collaboration model where we
formulate the overall vehicle design and are responsible for vehicle testing, we jointly conduct
testing of the vehicles with the automotive OEMs before shipment.
Contract Manufacturers
We typically engage contract manufacturers for production rather than sourcing from
third-party suppliers when the hardware or component with our required quality or specifications is
not readily available on the market or such hardware or component require customization to our
technology or products.
The salient terms of our agreements with contract manufacturers are set forth as below:
 Principal rights and obligations of parties involved. We provide technical specifications
and key raw materials to contract manufacturers who provide the manufacturing,
assembly and testing services for our products.
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 Payment and delivery. We are responsible for timely payment to contract manufacturers,
who are responsible for delivery of products to our designated location specified in the
agreements.
 Subcontracting. Subcontracting is not allowed without our prior written authorization.
 Quality assurance. Products are accepted in accordance with our specifications, as well
as national, local and industry standards. Should any quality issues arise during the
warranty period, the contract manufacturers are responsible for replacement.
 Termination. The agreements will be terminated by mutual agreement, or by other
means as set forth in the agreements.
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Manufacturing Process
The following chart illustrates the manufacturing process of products that are assembled,
tested and packaged at our self-operated factories:
Development and Design Outsourcing Quality Inspection
Structural Design Product Casing Inspection
Circuit Board Design
Functional
Software Design Modules
PCBA
Raw Materials
Warehouse
Firmware Modules
Programming
Product Assembly
Process Inspection
Final Product
Inspection
Product Packaging
Product Packaging
Product Testing
Aging Testing
Functional
Testing
Warehousing and Logistics Production Testing
Incoming Inspection
Stage
Assembly and
Testing Stage
Inspection and
Inventory Stage
 Formulation of product design and production plan. Upon receiving customer orders,
we begin with product design and production planning to ensure each product meets
customer specifications and our own high standards.
 Material preparation. The material preparation process lays the foundation for the
quality and sustainability of our final products. We procure from external suppliers the
materials, components and modules required for our products. We may also engage
contract manufacturers for additional processing before commencing the assembly
process.
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 Assembly, calibration and testing. We assemble, calibrate and test the products in our
own factory.
 Quality control. Quality inspection is integrated throughout the entire process, see “—
Quality Control.” Raw materials and each product undergo rigorous inspection to ensure
they meet our benchmarks. We conduct final inspections on products that pass the
calibration process.
 Packaging and delivery. After the products pass the final inspection, they are securely
packaged to prevent any damage during transit.
We own all the assembly lines, machinery and equipment at our factories. We are constantly
upgrading our machinery and equipment to improve our operational efficiency. Depreciation is
calculated using the straight-line method to allocate their costs net of their residual values over
their estimated useful lives or, in case of leasehold improvements, the shorter lease term. See Note
2.2.7 to the Accountant’s Report in Appendix I to this prospectus. We perform routine and
preventative maintenance on our manufacturing machinery and equipment to ensure that they
function properly at all times and comply with relevant laws and regulations.
LOGISTICS AND INVENTORY MANAGEMENT
Logistics
We primarily engage reputable third-party logistics service providers to deliver our hardware
products from production facilities and warehouses to the venue specified by our customers. To the
best of our knowledge, such logistics service provider is an Independent Third Party.
Inventory Management
Our inventories amounted to RMB123.5 million, RMB174.2 million, RMB96.5 million and
RMB170.5 million as of December 31, 2022, 2023, 2024 and June 30, 2025. Our inventories
during the Track Record Period primarily consisted of contract costs in progress, raw materials,
finished goods and consigned-processing-material. We regularly track our inventory to keep it at a
level sufficient to fulfill customers’ orders. We also proactively assess changes in market
conditions and pre-store strategic raw materials in anticipation of potential supply shortage. Our
finance team reviews our inventory aging reports routinely and takes necessary actions to
minimize risks of obsolescence.
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QUALITY CONTROL
We are committed to maintaining the highest level of quality in our products and solutions.
We have designed and implemented a quality management system that provides the framework for
continuous improvement of products and processes. We have also implemented a management
review control process to conduct regular systematic reviews of our quality management system, in
order to closely monitor the implementation of our quality management system.
R&D Activities
We develop our products and solutions in accordance with the requirements of relevant laws
and regulations and industry practices as well as our internal quality control procedures. We
conduct a series of rigorous evaluation and validation processes during the whole process of our
R&D activities to ensure quality of our products and solutions. Specifically: (i) in the start-up
phase, we hold meetings to know customer demands and evaluate and review project viability; (ii)
in the planning phase, we develop a detailed project plan and prepare project documents based on
demands analysis; (iii) in the execution and monitoring phase, we implement our technical
solutions, and test and validate the results; and (iv) in the closing phase, we summarize the lessons
learned report.
Supply Chain Management
We have comprehensive policies and detailed procedures in place to ensure the quality of the
components and raw materials we purchase from suppliers. When selecting and evaluating
suppliers, we conduct due diligence and consider a number of factors, including, but not limited
to, their reputations, credentials, experience, service or product availability, price and delivery
time.
We require all of our suppliers to comply with our internal supply management policies. Our
quality control development is responsible for communicating with suppliers regarding quality
standards, and will thoroughly inspect product samples 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 timely remedy quality issues upon notice.
Product Returns and Recalls
We stablished a comprehensive set of management and control procedures to ensure the
quality of our products. These procedures cover the procurement of external materials, the
production process, and changes in product design and manufacturing processes. We implement
identification and traceability management for our products, appropriately marking products and
their status to prevent mix-ups or misuse at various stages, including receipt, production, delivery
and after-sales service. For critical components, we manage them through a system that enables
traceability by batch or precise traceability.
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Our after-sales service department is responsible for addressing customers’ after-sales
requests. Following our after-sales service management procedures, we confirm relevant
information with customers, create repair work orders, and conduct follow-ups after the service is
completed. If a product is confirmed to be non-conforming, it will be returned to us, and we will
manage and dispose of the non-conforming product according to our non-conforming product
control procedures.
During the Track Record Period, we did not experience any product returns or recalls due to
product defects. In isolated instances during the Track Record Period, we received product returns
when our sales agreements were terminated due to our customer not being able to complete the
project for their own reasons unrelated to us. In 2022, 2023, 2024 and the six months ended June
30, 2024 and 2025, we had product returns of nil, nil, RMB0.03 million, RMB0.03 million and nil,
respectively, which we believe did not have a material impact on our financial performance.
EMPLOYEES
As of June 30, 2025, we had 460 full-time employees. The following table sets forth the
number of our employees by function:
Employee Function
Number of
employees % of Total
Research and Development ........................... 249 54.1
Management, Administration and others ................. 78 17.0
Engineering and Delivery ............................ 93 20.2
Sales and Marketing ................................ 40 8.7
Total ............................................ 460 100.0
Our success depends on our ability to attract, retain and motivate qualified personnel, and we
believe that our high quality talent pool is one of the core strengths of our company. We adopt
high standards and strict procedures in our recruitment to ensure the quality of new hiring and use
various methods for our recruitment, including campus recruitment, online recruitment, internal
recommendation and recruiting through hunting firms or agents, to satisfy our demands for
different types of talents.
As required under PRC regulations, we participate in various employee social security plans
that are organized by applicable local municipal and provincial governments, including housing,
pension, medical, work-related injury, maternity and unemployment benefit plans. We enter into
employment contracts and agreements regarding confidentiality, intellectual property and
non-competition with our executive officers, managers and employees. In addition, we usually
enter into proprietary information and inventions agreements with our core employees, under
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which we have all right, title and interest relating to any and all inventions by such employee
during the term of his/her employment with the Company. Further, when employees are hired, we
give them an employee handbook, which informs them of our policies and their rights in all
material respects, from recruitment, compliance, salary, benefits and performance assessment to
training and development.
To remain competitive in the labor market, we provide competitive salaries and various
incentives and benefits to our employees. We invest in continuing education and training programs,
including internal and external training, for our management staff and other employees to upgrade
their skills and knowledge.
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.
INSURANCE
We maintain insurance policies that are required under PRC laws and regulations, and based
on our assessment of our operational needs and industry practice. We purchased property all risks
insurance for our buildings, machinery and equipment and third-party liability insurance for our
test vehicles. We do not maintain product liability insurance. We believe that our existing
insurance coverage is sufficient for our present operations and aligns with the industry practice in
the PRC.
During the Track Record Period, we did not make any material insurance claims in relation to
our business. See “Risk Factors — Risks Relating to Our General Operations — Our insurance
coverage may not be sufficient to cover all losses or potential claims by our customers which
would affect our business, results of operations and financial condition.”
ENVIRONMENTAL, SOCIAL AND GOVERNANCE
Governance
We are committed to maintaining sustainable business operations to ensure all our activities
comply with applicable laws, regulations and policies related to environmental, social and
governance (“ ESG”). Our management systems have been certified to satisfy the requirements of
ISO 9001 for quality management systems, ISO 45001 for occupational health and safety
management systems and ISO 14001 for environmental management systems.
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Our Board of Directors is tasked with overseeing all aspects of ESG matters. This includes
assessing and identifying ESG-related risks and opportunities, ensuring the effective
implementation of ESG risk management and internal control systems, and establishing our ESG
management approach, strategy, priorities and objectives. The Board of Directors identifies
material ESG issues through steps such as integrating environmental and social responsibility into
daily management, regularly evaluating and reporting on these matters and engaging with
stakeholders such as investors, customers, partners and employees to identify ESG matters relevant
to them. Moreover, we consistently monitor compliance with relevant laws and regulations,
promote employee awareness and participation in ESG initiatives and actively participates in social
welfare activities.
We have established an ESG working group under the Board of Directors, creating a tiered
system comprising the Board of Directors, senior management, the ESG working group, various
departments, subsidiaries and branches. This ensures the presence of an appropriate and effective
risk management and internal control system for ESG matters, as well as the evaluation,
prioritization and management of significant ESG issues. The ESG working group is primarily
responsible for coordinating and overseeing the progress and implementation of ESG goals,
regularly evaluating our social responsibility performance and reporting to the Board of Directors.
Our various departments, subsidiaries and branches are mainly responsible for the implementation
of ESG initiatives.
Through our internal governance and the implementation of environmental and occupational
health and safety measures, we strive to foster a healthy and safe working environment for all
employees. During the Track Record Period and up to the Latest Practicable Date, our rate of
material workplace injuries was 0.0%, and we had not been subject to any fines or other penalties
due to non-compliance with health, safety or environmental regulations.
Environmental Protection
Our intelligent driving solutions prioritize safety, environmental protection and low carbon
emissions, contributing to sustainable development. Our V2X products collect and analyze vast
traffic data to aid urban planning, transportation policymaking and infrastructure development,
enabling more economically efficient decisions. Additionally, our autonomous electric mining
trucks excel in productivity, safety and cost-effectiveness compared to traditional human-driven
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fuel trucks. For example, our zero-carbon mining project with TCC set industry benchmarks in
reducing diesel consumption and carbon emissions, as well as lowering operational and
maintenance costs, with an annual reduction of over 1,800 tons of carbon emissions.
We adhere to all laws and regulations and are dedicated to continuous improvement, aiming
to minimize the environmental impact of our operations while ensuring our environmental
protection efforts remain legal and compliant.
Resource Consumption and Emissions
We primarily utilize resources such as electricity, water and gasoline in our daily operations.
The following table sets forth a breakdown of the consumption of electricity, water, natural gas
and packaging material used for finished goods during the years indicated:
Y ear ended December 31,
Six months ended
June 30,
2022 2023 2024 2025
Electricity consumption (million
kWh) .................. 1.23 1.24 1.35 0.62
Electricity intensity
(thousand kWh/million RMB
revenue) ................ 39.6 9.4 3.3 1.52
Water consumption (m
3) ........ 7,704 7,216 6,821 3,302
Water consumption intensity
(m3/million RMB revenue) ..... 248 54 17 8
Gasoline consumption (kg) ...... 30,618 31,508 17,590 6,646
Gasoline consumption intensity
(kg/million RMB revenue) ..... 985 238 43 16
The following table sets forth a breakdown of our Scope 1 and Scope 2 greenhouse gas
(“GHG”) emissions for the years indicated. Going forward, we plan to further expand our
monitoring scope of GHG emissions to include Scope 3 emissions, enabling better control of GHG
emissions.
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Y ear ended December 31,
Six months ended
June 30,
2022 2023 2024 2025
Scope 1 GHG emissions
(tonnes of CO 2 equivalent) ..... 96 99 55 21
Scope 2 GHG emissions
(tonnes of CO 2 equivalent) ..... 702,039 709,453 770,475 353,586
Total
(tonnes of CO 2 equivalent) ..... 702,136 709,552 770,530 353,607
GHG emissions intensity
(tonnes of CO 2 equivalent/million
RMB revenue) ............ 22,609 5,351 1,879 867
Metrics and Targets
We recognize the critical importance of environmental protection and sustainability. With a
focus on environmental responsibility and minimizing our ecological footprint, we established
environmental targets that are in line with our overall business strategy and objectives.
Metric Target Measures
Energy efficiency ..... 5% reduction in total
electricity
consumption by
2025 compared with
2023.
 Energy monitoring and smart
management systems: Conduct periodic
energy monitoring to identify major
consumption areas, and install a smart
management system tailored to the office
environment for real-time monitoring and
automatic energy usage adjustments.
 Equipment upgrades: Replace outdated,
energy-intensive equipment such as air
conditioners, lighting and production
machinery with more energy-efficient
alternatives.
 Employee training and awareness:
Provide training to employees on
energy-saving awareness and encourage
the adoption of energy-saving measures.
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Metric Target Measures
Water consumption ... 5% reduction in total
water consumption
by 2025 compared
with 2020.
 Water resource recycling and reuse:
Implement a water recycling system for
cooling, washing, etc., to reduce the
demand for fresh water.
 Leak monitoring and repair: Conduct
periodic inspections on water pipelines
and promptly repair any leaks detected.
 Installation of water-saving devices:
Install water-saving devices in restrooms,
such as sensor faucets.
In addition, we plan to regularly assess the effectiveness of our environmental measures and
issue ESG reports to present our progress and achievements to stakeholders. Through the
implementation of our ESG-related policies and measures, we will not only significantly reduce
our environmental impact and dependence on natural resources, but also establish a positive image
of sustainable development within the industry. Our ESG efforts will also bring long-term
economic benefits, such as reduced operational costs and enhanced competitiveness.
Social Responsibility
Employment
Human resources play a crucial role in achieving long-term sustainable development. We
advocate for harmonious labor relations and prioritize employee care. We established a labor union
dedicated to continuously maintaining and developing harmonious labor relations, serving
employees, supporting their growth and safeguarding their interests. In compliance with PRC laws
and regulations, we participate in various employee social security programs organized by local
governments. In addition, to provide more comprehensive protections for our employees, we
purchase supplementary commercial insurances for our full-time employees. We were honored with
the Best Employer Award by Liepin in 2018 and the Extraordinary Employer Award by Liepin for
two consecutive years in 2018 and 2019. Additionally, in 2022, we received the Talent Acquisition
Award from Risfond, and we were recognized as a High-Quality Employment Demonstration
Enterprise by the Hunan Xiangjiang New Area Civil Affairs and Social Security Bureau.
We offer both onboarding and on-the-job training for our employees. The training includes
technical, management and general knowledge courses. During the Track Record Period, we
provided on average around 13.6 hours of training per employee.
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Supply Chain Management
We are committed to prioritizing the purchase of environmentally friendly materials and
products, which supports the development of a sustainable supply chain that not only aligns with
our commitment to environmental responsibility but also encourages our suppliers to adopt
sustainable practices, fostering a culture of sustainability within the industry. We utilize internal
supply chain management policies and procedures to manage relevant aspects in our entire product
development, procurement and production processes. We also conduct thorough evaluations of our
suppliers based on their respective industries and past quality performance, requiring them to
provide certifications, including but not limited to ISO 9001, IATF 16949, ISO 14001 and ISO
45001. We adhere to principles of simplicity, efficiency and customer convenience, packaging our
products in a more environmentally friendly manner.
BUSINESS SUSTAINABILITY
We have experienced strong revenue growth during the Track Record Period. During the
Track Record Period, we engaged in offering autonomous driving solutions, V2X products and
solutions and intelligent perception solutions, all of which are designated Specialist Technology
Products as defined under Chapter 18C of the Listing Rules. Our revenues increased from
RMB31.1 million in 2022 to RMB410.0 million in 2024 with a CAGR of 263.1%.
Our revenue increased by 57.9% from RMB258.5 million in the six months ended June 30,
2024 to RMB408.0 million in the six months ended June 30, 2025. Benefiting from the solid
foundation we have built and the momentum we have seized, we believe that we are able to
maintain sustainability and growth of our business.
Our gross profit margin was 20.2% and 24.7% in 2023 and 2024, respectively. We recorded a
gross loss margin of 19.3% in 2022. Our gross profit increased by 57.1% from RMB44.4 million
in the six months ended June 30, 2024 to RMB69.7 million in the six months ended June 30, 2025.
We had a net loss of RMB263.0 million, RMB255.1 million, RMB580.8 million, RMB122.6
million and RMB455.1 million in 2022, 2023, 2024 and the six months ended June 30, 2024 and
2025, respectively. Eliminating impact of items including (i) share-based payment, (ii) financial
cost on financial instruments with preferred rights at amortized cost, and (iii) listing expenses, we
generated an adjusted net losses (Non-IFRS Measure) of RMB158.9 million, RMB137.6 million,
RMB126.9 million, RMB59.4 million and RMB111.0 million in 2022, 2023, 2024 and the six
months ended June 30, 2024 and 2025, respectively. Adjusted net loss (Non-IFRS Measure) is a
non-IFRS measure. See “Financial Information — Non-IFRS Financial Measure.”
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Our net losses were primarily due to the significant amounts of cost of sales, general and
administrative expenses and R&D expenses incurred during the Track Record Period. Our cost of
sales increased throughout the Track Record Period, which was mainly attributable to the increase
in sales volume of our products and solutions. In addition, the absolute dollar amounts of general
and administrative expenses and selling expenses increased throughout the Track Record Period,
which is in line with our business expansion. We plan to implement prudent measures to manage
our costs and operating expenses.
Our Directors believe our pioneering R&D and ability to identify latent customer needs and
leverage comprehensive technological capabilities to develop high-value products for the optimal
product-market fit have laid a solid foundation for long-term development and business
sustainability. As of June 30, 2025, we delivered 304 autonomous mining trucks and 110 sets of
standalone autonomous truck systems to customers. Our strong track record of delivering
pioneering, large-scale projects such as the delivery of 56 autonomous mining trucks for the
world’s largest mixed-operation mining fleet has strengthened our reputation and earned substantial
additional customer orders. Our total order backlog value reached approximately RMB583.9
million as of June 30, 2025 and we received indicative orders for 357 autonomous mining trucks
and 290 sets of standalone autonomous truck systems as of the same date, a strong indication of
revenue growth as we begin to deliver for these customer orders.
We expect to increase the sales of our products and solutions with our enhanced sales and
marketing efforts. For intelligent driving, we plan to actively participate in industry exhibitions
and conferences to showcase our latest autonomous mining trucks and systems and highlight our
success cases in enhancing mining efficiency. Through site visits and direct client engagement, we
can further discover latent customer needs and offer customized services that cater to diverse client
needs and attract new customers through testimonials, word-of-mouth and enhanced brand
recognition. For V2X, amid the national push for its development, particularly in intelligent
transportation upgrades, we are redirecting our marketing efforts from government-led pilot zone
projects towards wider market demands and academic research needs to capitalize on such
development. We possess independent and comprehensive V2X research and testing facilities,
maintaining our technological lead and collaborating with autonomous vehicle manufacturers to
drive the large-scale deployment of OBUs. Collaborating with renowned universities, intelligent
transportation research institutes and automotive testing organizations, we have a solid foundations
for the future development of urban V2X and intelligent transportation systems. We also aim to
expand applications across sectors such as urban smart transportation, mobility and logistics,
thereby enhancing revenue sources. For intelligent perception, we have been enhancing visibility
through industry exhibitions and direct engagement with potential clients, while actively
participating in developing industry standards to build our reputation. Frequent communication
with stakeholders in the commercial vehicle and railway sectors allows us to identify customer
needs and craft tailored solutions. Our collaboration with OEMs and railway design institutes
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ensures the effective incorporation of our products during the design phase, promoting early
adoption. We expect our intelligent perception solutions to achieve high profit margin due to our
solid competitive edge in technological strengths, including our SIL4 certified TAPS system with
superior performance metrics than competitors.
We expect our operating expenses as a percentage of revenue to decrease as we continue to
ramp up our sales, achieve revenue growth and economies of scale with higher efficiency in our
research and development, sales and marketing and administrative activities, thereby lowering our
spending as a percentage of revenue on such activities. Additionally, we will continue to enhance
our manufacturing capabilities by partnering with contract manufacturers in order to meet mass
production needs while controlling capital expenditure. Our operating expenses decreased as a
percentage of revenue from 652.4% in 2022 to 136.2% in 2024, indicating improved operational
efficiency. Our operating expenses increased as a percentage of revenue from 44.5% in the six
months ended June 30, 2024 to 96.9% in the six months ended June 30, 2025. We are constantly
improving our operating efficiency in various areas. For instance, we have streamlined the project
management process to enhance our R&D efficiency and reduce the time-to-market of products.
Our extensive partner network and loyal customer base also enable us to leverage cross-selling
opportunities and word-of-mouth marketing by satisfied customers, positioning us for rapid growth
without significant investments in sales and marketing. Our sales team are well prepared to capture
business opportunities based on customer demands and are able to offer precise suggestions for
product design and delivery, minimizing subsequent changes and rework in the production process.
We have also improved our administrative management to reduce communication costs and
improve collaboration efficiency.
We have a healthy cash balance to support our business operations and future expansion.
During the Track Record Period, we had funded our cash requirements primarily with capital
contribution from shareholders and financing through the Pre-IPO Investments. See “History,
Development and Corporate Structure — Pre-IPO Investments.” We had cash and cash equivalents
of RMB381.7 million, RMB234.7 million, RMB306.4 million and RMB186.2 million as of
December 31, 2022, 2023, 2024 and June 30, 2025 respectively. Furthermore, as of June 30, 2025,
our total cash balance was RMB213.7 million, including RMB186.2 million in cash and cash
equivalents, RMB5.4 million in term deposits and RMB22.1 million in restricted bank deposits.
Our total cash balance is sufficient to cover our net cash flows used in operating activities and
provide adequate liquidity for our expansion of business operations. As such, we believe that we
possess sufficient working capital, including sufficient cash and liquidity assets, after taking into
account the financial resources available to us.
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PROPERTIES
Owned Properties
We own and occupy certain land parcels and buildings in the PRC for our business
operations. These owned properties are used for non-property activities as defined under Rule
5.01(2) of the Listing Rules. As of the Latest Practicable Date, we owned one land parcel with a
total site area of 53,395.6 sq.m. and nine properties with a total gross floor area of 46,164.2 sq.m.
in the PRC. As of the Latest Practicable Date, these properties are in the renovation phase and are
expected to be used as our offices, warehouses and for manufacturing purposes primarily including
product assembly, testing and packaging, etc. to support our business operations.
Except for the property interests described in the valuation report prepared by A VISTA
Valuation Advisory Limited, our Group has no other owned single property interest that forms part
of our non-property activities that has a carrying amount of 15% or more of the total assets
pursuant to Rule 5.01B(2)(b) of the Listing Rules. For details, please refer to the valuation report
in Appendix III to this prospectus.
Our PRC Legal Advisor confirmed that, as of the Latest Practicable Date, we had obtained
the real property title certificates and other relevant land use rights certificates of the above one
land parcel and nine properties.
Leased Properties
As of the Latest Practicable Date, we leased three properties with an aggregate gross floor
area of approximately 14,702.04 sq.m. in the PRC for use as our offices, our self-operated
factories and for the purpose of R&D. These leases generally have a term ranging from one to
three years.
LICENSES, APPROV ALS AND PERMITS
We lay great emphasis on the ultimate safety of our intelligent driving products and solutions.
Our intelligent driving technologies are designed to comply with automotive grade standards. Our
products and R&D procedures passed various industry recognized certifications and tests for safety
and reliability. The table below sets out the main standards, certifications and requirements that we
were compliant with as of the Latest Practicable Date:
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Standards, certifications
and requirements Definition of the standards, certifications and requirements
Our compliance with the
standards, certifications and
requirements
ISO 9001:2015 ......... An internationally accepted standard for quality
management systems published by the ISO,
encompassing the formulation of quality policies,
objectives and processes such as quality planning,
quality control, quality assurance and quality
improvement.
We are ISO 9001:2015
certified, with our
certificate valid until April
8, 2027. We operate in
accordance with the
quality system
requirements and are
committed to continual
improvement.
IATF 16949:2016 ....... A global technical specification and quality management
standard for the automotive industry, which extends the
principles of ISO 9001 to meet the stringent demands
of the automotive industry.
We are IATF 16949:2016
certified, with our
certificate valid until April
8, 2027. We adhere to the
quality system
requirements of the
automotive industry,
employing PDCA and risk
management-based
processes, and are
dedicated to ongoing
improvement.
ISO 45001:2018 ........ An international standard for occupational health and
safety management systems published by the ISO,
which provides a framework for organizations to
manage risks and improve performance by identifying,
evaluating and controlling hazards in the workplace.
We are ISO 45001:2018
certified, with our
certificate valid until
October 24, 2028. We
operate in accordance with
the system requirements
and strive for further
enhancement.
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Standards, certifications
and requirements Definition of the standards, certifications and requirements
Our compliance with the
standards, certifications and
requirements
ISO 14001:2015 ........ An internationally recognized standard for environmental
management systems, published by the ISO, which
provides a framework for organizations to improve
their environmental performance through more efficient
use of resources and reduction of waste, thereby
achieving sustainable development.
We are ISO 14001:2015
certified, with our
certificate valid until
August 28, 2026. We
operate in accordance with
the system requirements
and strive for further
enhancement.
ISO 26262:2018 ........ An international standard for the functional safety of road
vehicles, focusing on electrical and electronic systems.
It aims to enhance safety by addressing potential
hazards from system malfunctions. The standard uses
the Automotive Safety Integrity Level (ASIL) for risk
classification, divided into four levels: A, B, C and D,
with ASIL D representing the highest level of
stringency.
We obtained ISO
26262:2018 (ASIL-D)
certification for our
functional safety
development process and
established a product
development system that
meets the highest
functional safety
standards.
SIL 4 ............... Safety Integrity Level 4, which is part of an
internationally accepted system for evaluating the
safety performance of safety-related equipment. SIL
certification assesses the reliability and performance of
these systems. The levels range from SIL 1 to SIL 4,
with SIL 4 being the most stringent.
Certain of our products and
solutions for rail transit
are certified to SIL 4
standards for the rail
transit industry.
SIL 2 ............... Safety Integrity Level 2 of the abovementioned SIL
certification system.
Certain of our products and
solutions for rail transit
are certified to SIL 2
standards for the rail
transit industry.
Radio Transmission
Equipment Type Approval
Certificate ..........
A certificate issued by the Ministry of Industry and
Information Technology in China certifying that the
radio transmission equipment conforms to the
provisions of the Radio Regulations of the PRC
Certain of our V2X products
have received such
certificates
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Standards, certifications
and requirements Definition of the standards, certifications and requirements
Our compliance with the
standards, certifications and
requirements
Network Access License for
telecommunications
equipment ..........
A mandatory approval of telecommunications equipment
that will be connected to the public telecommunications
network licensed by the Ministry of Industry and
Information Technology in China
Certain of our V2X products
have received such
approvals
During the Track Record Period and up to the Latest Practicable Date, as advised by our PRC
Legal Advisor, we had obtained all licenses and permits required for our business operations in the
PRC in all material respects, and such business licenses had remained in full effect. Our PRC
Legal Advisor further confirms that save for the above-mentioned industry-specific standards and
certifications, there is no other regulatory approval required and/or obtained for each key
Specialist Technology Product under the relevant PRC laws and regulations, such as for our
autonomous driving trucks. As of the Latest Practicable Date, no material unexpected or adverse
changes had occurred since the dates of issue of the relevant regulatory approvals for our
Specialist Technology Products.
LEGAL PROCEEDINGS AND COMPLIANCE
Legal Proceedings
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. See “Risk Factors —
Risks Relating to Our General Operations — 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.”
In December 2024, one of our construction service suppliers filed a lawsuit against us
regarding a payment settlement dispute in relation to a construction project for our self-operated
factory, seeking payment of RMB36.1 million in total, including the disputed contract amount of
RMB35.2 million, which has been recorded in our other payables but remains unpaid due to
disagreement over settlement terms, and interests amounting to RMB849.1 thousand, for which we
had made full provisions. The dispute is ongoing, and no court judgment had been issued as of the
Latest Practicable Date. In January 2025, the court approved the plaintiff’s application for
pre-litigation property preservation and placed a lien on one of our properties currently under
renovation planned for warehousing and manufacturing use, as well as a portion of funds in our
bank accounts, as a provisional measure. According to our PRC Legal Advisor, the court-ordered
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property preservation is a temporary procedural measure under PRC civil procedure law to prevent
potential asset dissipation and does not reflect any judgment on the merits of the case; the
preservation was granted based on the plaintiff’s application and provision of insurance guarantee,
meeting the procedural requirements for granting such measure. Our PRC Legal Advisor advised
that such measures do not imply the court’s support for the plaintiff’s claims in any way as the
substantive issues of the dispute remain to be adjudicated during the trial, and if the plaintiff’s
claims are ultimately rejected, they may be liable for damages caused by the preservation. We
believe that such property preservation measures do not have a material impact on our business
operations and financial conditions. This litigation arose from the ordinary course of our
operations and does not concern our core business or assets. We believe and our PRC Legal
Advisors are of the view that such dispute would not have a material adverse impact on our
business operations.
Save as disclosed, during the Track Record Period and up to the Latest Practicable Date,
there were no legal proceedings pending or threatened against us or our Directors that could,
individually or in the aggregate, have a material adverse effect on our business, financial condition
and results of operations.
Compliance
During the Track Record Period and up to the Latest Practicable Date, we had not been and
were not involved in any material incidents of non-compliance.
As advised by our PRC Legal Advisor, our business operations were conducted in compliance
with applicable laws and regulations in all material respects during the Track Record Period and
up to the Latest Practicable Date.
U.S. Export and Import Control Laws and Regulations
We currently rely on certain U.S. originated modules for our intelligent driving platforms
which provide the computing power required by our autonomous systems for our autonomous
mining trucks, certain V2X products and TAPS, which accounted for 74%, 36.6%, 36.6%, 6.6%
and 1.6% of our purchase amount for modules that provide computing power for our products and
solutions in 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025, respectively. We
are able to identify the types and origination of the modules from the purchase agreements with
our suppliers. These modules, to the best of our knowledge and as advised by our U.S. Export
Control and Sanctions Counsel, based on export classification information provided by the module
manufacturer, are only controlled for anti-terrorism reasons. Items that are controlled solely for
anti-terrorism reasons are not subject to destination-based controls for mainland China. Such items
therefore do not require a license for export to mainland China, absent other applicable
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restrictions, such as end user or end use based restrictions including those imposed on entities
designated on the Entity List. Since we are not designated on the Entity List or any other export
control or sanctions list maintained by the U.S. government, and we do not transfer such items to
any entities designated on the Entity List or to any other prohibited end user or for any prohibited
end use, we are permitted to receive these items solely controlled for anti-terrorism reasons
without a license. In addition, our U.S. Export Control and Sanctions Counsel has reviewed our
customer list and advised that none of the past or existing customers during the Track Record
Period has been designated on the Entity List. Furthermore, we believe that the current U.S. export
control laws and regulations have not impacted our ability to obtain the semiconductors and other
technologies that we incorporate into our products and solutions, or that we use in our business, or
our ability to make sales to either our current or prospective customers as we expand our business,
given that we have not experienced any supply shortages or disruptions as of the Latest Practicable
Date. See “Regulatory Overview — Laws and Regulations relating to U.S. Export and Import
Controls.” However, as these export controls laws and regulations continue to expand and evolve,
future sanctions and export controls may materially affect or target some of our significant
customers or suppliers, raw materials or key components or technologies necessary for our
operations, in which event our business may be affected if we fail to promptly secure alternative
customers or sources of supply on terms acceptable to us. As of the Latest Practicable Date, as
advised by our U.S. Export Control and Sanctions Counsel, we are not aware of any prospective
sanctions or export controls policy that would restrict us from using such U.S. originated modules.
To mitigate such risks, as of the Latest Practicable Date, we have developed and tested multiple
mature domestic substitute technology solutions that can support the rapid and large-scale
replacement of the modules required for our products and solutions. We believe that we would be
able to switch to alternative suppliers in China that offer comparable technology, quality and price
in the event of supply restrictions on U.S. originated modules, given that we have previously
purchased comparable intelligent driving computing platforms from domestic suppliers which we
have incorporated into certain of our products and maintain some of them in inventory. Although
switching to domestic substitute suppliers may incur extra time arising from customer
communication and, for large-scale orders, additional procurement and production, which we
expect could take one to three months depending on the specific product, we believe that such
circumstances would not have a material adverse impact on our business operations or financial
condition.
In addition, BIS released a final rule that would, among other things, prohibit transactions
involving the import or sale of vehicle connectivity systems (“ VCS”) hardware and completed
connected vehicles that incorporate VCS hardware or certain software that directly enables VCS or
Automated Driving Systems (“ ADS”) with a sufficient nexus to the PRC or Russia (“ Connected
Vehicle Rule ”). Under the Connected Vehicle Rule, vehicles with a gross vehicle weight rating of
more than 4,536 kilograms (10,000 pounds) are excluded from the definition of a ‘connected
vehicle’. As most commercial vehicles exceed this weight threshold, the rule generally does not
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cover commercial vehicles. See “Regulatory Overview — Laws and Regulations relating to U.S.
Export and Import Controls.” Although we currently offer products that fall under the definition of
VCS and are used in ADS products, we exclusively sell commercial vehicles with a gross vehicle
weight rating (“ GVWR”) of more than 4,536 kilograms (10,000 pounds), including autonomous
logistics trucks with a GVWR of over 18,000 kilograms and autonomous mining trucks with a
GVWR of over 100,000 kilograms, and our standalone intelligent driving systems are designed
exclusively for such commercial vehicles. Accordingly, we believe, and as advised by our U.S.
Export Control and Sanctions Counsel, our products do not fall within the current scope of the
Connected Vehicle Rule. Moreover, as of the Latest Practicable Date, we do not sell our products
in the U.S. or to customers who incorporate them into products sold in the U.S., and have no plans
to do so. However, if the scope of the Connected Vehicle Rule is expanded to cover commercial
vehicles, it may restrict our ability to sell or otherwise commercialize our products in the U.S.
market, if we wish to do so in the future. See “Risk Factors — Risks Relating to Our General
Operations — We may be subject to risks associated with international trade policies, investment
restrictions, geopolitics and trade protection measures, including imposition of trade restrictions
and sanctions, and our reputation, business, results of operations and financial condition could be
adversely affected.”
RISK MANAGEMENT AND INTERNAL CONTROL
We have established a set of risk management measures and internal control policies and
procedures that we consider to be appropriate for our business operations, and we are dedicated to
continuously improving these policies. Furthermore, we continually review the implementation of
our risk management policies and measures to ensure that our policies and implementation are
effective and sufficient. We have adopted and implemented comprehensive internal control
management in various aspects of our business operations, including the following.
Financial Management
We have in place a set of accounting policies in connection with our financial reporting risk
management. We have various procedures in place to implement accounting policies, and our
financial department reviews our management accounts based on such procedures. We also provide
regular training to our employees in the finance department to ensure that they understand our
financial management and accounting policies and implement them in our daily operations.
Compliance Management
In order to effectively manage our regulatory compliance and legal risk exposures, we have
adopted strict internal procedures to ensure the compliance of our business operations with the
applicable rules and regulations. In accordance with these procedures, our in-house legal
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department performs the basic function of reviewing and updating the form of contracts we enter
into with our customers, suppliers and other business partners. Our sales manager examines the
contract terms and reviews relevant documents for our business operations, including licenses and
permits obtained by the counterparties to perform their obligations under our business contracts
and the necessary underlying due diligence materials, before we enter into any contract or business
arrangements. We also issued the internal contract management policies to regulate the business
contract signing, reviewing and implementation procedures. In addition, we continuously improve
our internal policies according to changes in laws, regulations and industry standards, such as the
policies related with intelligent driving and data privacy.
Human Resource Management
We have established internal control and risk management policies covering various aspects
of human resource management such as recruitment, training, work ethics and legal compliance.
We maintain high standards in recruitment with strict procedures to ensure the quality of new hires
and provide specialized training tailored to the needs of our employees in different departments.
We also conduct periodic performance reviews for our employees, and their remuneration is
performance based. We monitor the implementation of internal risk management policies on a
regular basis to identify, manage and mitigate internal risks in relation to the potential
non-compliance with our code of conduct, work ethics, and violations of our internal policies or
illegal acts at all levels of our Group.
A W ARDS AND RECOGNITIONS
During the Track Record Period and up to the Latest Practicable Date, we received awards
and recognition in respect of our products, technology and innovation, significant ones of which
are set forth below:
Award/Recognition
Award
year Awarding Institution/Authority
Outstanding Service Provider for
Vehicle-Road-Cloud Integration in 2024
(2024ਕ౤Զਠ ) ...
2025 7its.com ( ᒄ˖ʹஷၣ )
2024 Pioneer Enterprise in Autonomous
Driving Commercialization in China
(2024΋ቜ
Άุ) ...........................
2024 Equal Ocean Auto ( ᄂᆄӛԓ)
2024 Outstanding Sci-Tech Company (2024
௴λʮ̡ ) ......................
2024 CLS (ٟ)
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Award/Recognition
Award
year Awarding Institution/Authority
2024 Renowned Brand Award in the
Internet of Vehicles Industry (2024 ԓᑌ
೐ᆤ ) .................
2024 Organizing Committee of the China
(Greater Bay Area) Internet of Vehicles
Conference ( ʕ਷(ɽᝄਜ)ԓᑌၣɽึଡ଼
։ึ)
2024 Mining Technology Excellence
Awards (2024 મᘤҦஔՙ൳ᆤ ) ........
2024 Global Data
First Prize of the China Highway &
Transportation Society Science &
Technology Award (ኪҦ
ஔᆤ) ...........................
2023 China Highway & Transportation Society
(ʕ਷ʮ༩ኪึ )
National Technologically Advanced “Little
Giant” Enterprises (ॴਖ਼ၚतอʃ̶
ɛ) .............................
2023 Ministry of Industry and Information
Technology (ࢹڦ
ʷ௅)
Hunan Engineering Technology Research
Center (Ӻʕː ) .....
2022 Department of Science and Technology of
Hunan Province (ኪҦஔᝂ )
Hunan Provincial Enterprise Technology
Center (ΆุҦஔʕː ) .........
2022 Industry and Information Technology
Department of Hunan Province (޲ی
ʷᝂ )
2022 List of New Unicorns (2022ዹ
ԉᖕ࿮ఊ) ........................
2022 Forbes China ( ၅̺౶ʕ਷ )
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DIRECTORS
Upon Listing, our Board consists of eight Directors, including two executive Directors, three
non-executive Directors and three independent non-executive Directors. Our Directors serve a term
of three years and may be re-elected for successive reappointments.
The following table sets forth certain information regarding our Directors:
Name Age Position(s)
Date of joining our
Group
Date of appointment as
a Director Roles and responsibilities
Executive Directors
Dr. Ma Wei ( ৵ᐂ) ...... 69 Co-founder, executive Director
and vice chairman
October 2017 October 16, 2017 Responsible for architecting
technology framework and
business model, research and
development of new product
technology of our Group and
strategic planning of such
research and development
Dr. Hu Albert Sibo (౶௹) . 38 Executive Director and chief
executive officer
January 2018 October 30, 2023 Responsible for research and
development of system
algorithm and simulation,
business development,
marketing and production of
our Group, overseeing the
financial matters of the Group
Non-executive Directors
Prof. Li Zexiang ( ҽዣಱ) .. 64 Founder, chairman of our Board
and Non-executive Director
October 2017 October 16, 2017 Responsible for overseeing the
overall business strategy and
direction, formulating
management structure and
growth objectives; align
external resources to
company’s technology
capabilities
Mr. Wang Hao (؀)
1) ... 41 Non-executive Director December 2019 December 9, 2019 Responsible for providing
advice to the Board and align
the eco system resources to
help the company growth
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Name Age Position(s)
Date of joining our
Group
Date of appointment as
a Director Roles and responsibilities
Ms. Yang Xi ( เ๣) ..... 37 Non-executive Director October 2017 October 16, 2017 Responsible for providing
advice to the Board and align
the eco system resources to
help the company growth
Dr. Li Zhiyong (ۇ)... 54 Non-executive Director Listing Date Listing Date Responsible for providing
advice to the Board and align
the eco system resources to
help the company growth
Independent non-executive Directors
Dr. Li Xiaoyuan (ࡡ)...66 Independent non-executive
Director
Listing Date Listing Date Responsible for providing
independent advice on the
operation and management of
our Company
Prof. Tan Guangrong
(ᗈΈ࿲) .........
62 Independent non-executive
Director
Listing Date Listing Date Responsible for providing
independent advice on the
operation and management of
our Company
Mr. Zhang Jiangang ( ੵ਄፻) . 33 Independent non-executive
Director
Listing Date Listing Date Responsible for providing
independent advice on the
operation and management of
our Company
Note:
(1) As of the date of this prospectus, Mr. Wang Hao was our non-executive Director. Mr. Wang Hao has already
tendered his resignation from directorship, conditional and effective upon Listing, and the appointments (i) of Dr.
Li Zhiyong as a non-executive Director and (ii) Dr. Li Xiaoyuan, Prof. Tan Guanrong and Mr. Zhang Jiangang as
independent non-executive Directors will become effective at the same time. Mr. Wang Hao is a board
representative of HongShan prior to Listing and have performed non-executive functions through providing advice
on our overall development as a private company. Mr. Wang has tendered his resignation based on internal
decision-making of HongShan which he represents and his intention to focus on other endeavours. In addition, the
appointment of three independent non-executive directors would allow us to meet the requirements under Rules
3.10(1) and 3.10A of the Listing Rules that our Board shall include at least three independent non-executive
directors, who shall represent at least one-third of our Board. Mr. Wang Hao has confirmed to the Board that he has
no disagreement with the Board and there are no other matters in relation to his resignation that need to be brought
to the attention of the Shareholders of the Company.
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Executive Directors
Dr. Ma Wei ( ৵ᐂ), aged 69, is the co-founder, executive Director and the vice chairman of
our Company. He joined our Company since October 2017. He was appointed as our Director on
October 16, 2017.
Dr. Ma has more than 20 years of experience in the electronics and technology industry. Prior
to founding our group, Dr. Ma served as a lecturer at Xi’an University of Electronic Science and
Technology (Ҧɽኪ ) from January 1985 to September 1989. He then served as a
director at National Semiconductor Inc in the United States from January 2002 to September 2012
and a director at Texas Instrument Inc in the United States from September 2012 to October 2017.
Dr. Ma obtained a bachelor’s degree in communication engineering in April 1982 and a
master’s degree in communication engineering in April 1985 from Xi’an University of Electronic
Science and Technology (Ҧɽኪ ) in the PRC. He also obtained a doctorate degree in
Signal Processing from Surrey University in the United Kingdom in August 1994.
Dr. Hu Albert Sibo (౶௹), aged 38, is the executive Director and chief executive officer
of our Company. He joined our Group in January 2018. He was appointed as our Director and
chief executive officer on October 30, 2023.
Prior to joining our Group, Dr. Hu worked in algorithmic trading at C&C Trading, LLC in
New York City, USA between November 2009 and July 2011 where he developed automated
systems and strategies.
Since January 2018, Dr. Hu has successively served as a senior scientist at the intelligent
driving platform department, a principal scientist at the new technology development center, a
director of research and development at the technology innovation center and the head of
CiDiLabs at our Company. Dr. Hu was recognized as a municipal industry leader as the
Changsha’s High-End Talent Leading Project by the Changsha Municipal Talent Leading Group in
August 2021.
Dr. Hu obtained a bachelor’s double degree in economics and mathematics from Williams
College in the United States in June 2009. He then obtained a master’s degree in business
administration in December 2014 and a doctorate degree in business administration in December
2017 from the University of California, Berkeley in the United States.
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Non-executive Directors
Prof. Li Zexiang ( ҽዣಱ), aged 64, is the founder, chairman of our Board and non-executive
Director of our Company. He joined our Company since October 2017. He was appointed as our
Director on October 16, 2017.
Prof. Li has more than 30 years of experience in the motion control and manufacturing
industry. Prof. Li has served as a professor at the department of electronic and computer
engineering of the Hong Kong University of Science and Technology since 1992. He established
the center for automation technology at the Hong Kong University of Science and Technology in
1998 and has been the key member of the Robotics Institute of the Hong Kong University of
Science and Technology since 2015. Prof. Li has been the co-founder and director of Googol
Technology Co., Ltd. (ʮ̡ ), a company listed on the Shenzhen Stock Exchange
(stock code: 301510), since October 1999. Prof. Li was recognized as a fellow of the Institute of
Electrical and Electronics Engineers in 2008.
Prof. Li obtained a bachelor’s degree in electrical engineering and economics (with honors)
from Carnegie Mellon University in United States in August 1983. He also obtained a master’s
degree in engineering in May 1985, a master’s degree in mathematics in December 1989 and a
doctorate degree in engineering in December 1989 from the University of California, Berkeley in
United States.
Mr. Wang Hao (؀)aged 41, is the non-executive Director of our Company. He was
appointed as a Director on December 9, 2019.
Mr. Wang joined HongShan in September 2015, and currently serves as a managing director.
He has held directorships and positions in HongShan’ various subsidiaries and investment
companies, including, among others, Beijing Shengxin Network Technology Co., Ltd ( ̏ԯʺ㒥ၣ
ʮ̡ ), Shanghai Yiwei Software Systems Co., Ltd (ʮ̡ ),
Bochuang Linkage Technology Co., Ltd (ʮ̡ ) and Xiamen Gaoding Co.,
Ltd (ʮ̡ ).
Mr. Wang obtained a bachelor’ degree in communication engineering in June 2007 and a
master’ degree in communication engineering in March 2010 from Shanghai Jiao Tong University
(ɪऎʹஷɽኪ ) in the PRC.
Ms. Y ang Xi ( เ๣), aged 37, is the non-executive Director of our Company. She was
appointed as a Director on October 16, 2017.
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Ms. Yang has more than 7 years of experience in the design and technology industry. Since
June 2016, she has worked at Dongguan Songshan Lake International Robotics Research Institute
C o . ,L t d .(ʮ̡ ) with her last position as a general manager.
Ms. Yang obtained a bachelor’s degree in design from Tongji University in the PRC ( Ν᏶ɽ
ኪ) in June 2011, a master’s degree in applied innovation from the Hong Kong Polytechnic
University in June 2014 and a master’s degree in technology leadership and entrepreneurship from
the Hong Kong University of Science and Technology in November 2016.
Dr. Li Zhiyong (ۇ)aged 54, is a non-executive Director of our Company. He was
appointed as a Director with effect from the Listing Date.
Dr. Li has over 20 years of experience in the artificial intelligence and intelligent robotics
industry. Since February 2004, he has worked at Hunan University (ɽኪ) with his current
position as a professor at Xiangjiang Elite Engineers College of Hunan University ( ಱϪՙ൳ʈ೻
ɽኪʱ৫ ). Dr. Li was awarded the Second Prize of National Teaching Achievement
Award by the Ministry of Education of the PRC in July 2023, and the Second Prize of Hunan
Provincial Science and Technology Progress Award by the Government of Hunan Province in July
2021. He has been a member of the 13th CPPCC Hunan Provincial Committee since December
2022 and a director of the Chinese Association for Artificial Intelligence since March 2025.
Dr. Li obtained a doctorate degree in control theory and control engineering from Hunan
University (ɽኪ) in the PRC in June 2004.
Independent non-executive Directors
Dr. Li Xiaoyuan (ࡡ)aged 66, was appointed as an independent non-executive Director
of our Company with effect from the Listing Date.
Dr. Li has over 30 years of experience in the chemistry and academia industry. Dr. Li served
as a postdoctoral researcher at the department of chemistry of University of California, Berkeley in
the United States from 1988 to 1989 and subsequently served as a research associate at the Steacie
Institute for Molecular Sciences at the National Research Council of Canada in Canada from 1989
to 1991. Since August 1991, he has successively served as an assistant professor, associate
professor, professor, department head, chair professor and a professor emeritus in the department
of chemistry at the Hong Kong University of Science and Technology. He was awarded the
Outstanding Young Scientist Award (Overseas Category) by National Natural Science Foundation
of China (ึ ) in December 1999 and the SPACC-CSJ Award by the
Chemical Society of Japan in July 2005.
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Dr. Li obtained a bachelor’s degree in chemistry from Peking University ( ̏ԯɽኪ)i nt h e
PRC in February 1982. He then obtained a master’s degree in chemistry in July 1984 and a
doctorate degree in Chemistry in July 1988 from Princeton University in the United States.
Prof. Tan Guangrong ( ᗈΈ࿲), aged 62, was appointed as an independent non-executive
Director of our Company with effect from the Listing Date.
Prof. Tan has over 25 years of experience in the field of finance and accounting. He has
joined Hunan University (ɽኪ) since September 1999 and has been a professor at the school
of economics and trade since July 2009. Prof. Tan has been serving as an independent
non-executive director at Guangdong Guanghong Electronics Co., Ltd. (ʮ̡ ), a
company listed on the Shenzhen Stock Exchange (stock code: 002045), since January 2023, an
independent director at Delijia Transmission Technology (Jiangsu) Co., Ltd. (Ҧ (Ϫ
ᘽ)ʮ̡ ) since July 2023, an independent director at Shanhe Xinghang Industrial Co.,
Ltd. (ʮ̡ ) since August 2023 and an independent director at Hunan Feiwo
New Energy Technology Co., Ltd. (ʮ̡ ), a company listed on the
Shenzhen Stock Exchange (stock code: 301232). In December 2001, Prof. Tan was certified as a
non-practicing member of the Chinese Institute of Certified Public Accountants (ࢪࠇ
՘ึ).
He obtained a bachelor’s degree in economics with a major in accounting from Hunan
University of Finance and Economics in the PRC in June 1995, a master’s degree in management
science and engineering from Central South University of Technology (ʈุɽኪ ) in the PRC
in October 1997, and a doctorate degree in management science and engineering from Wuhan
University of Technology (ဏଣʈɽኪ ) in the PRC in June 2004.
Mr. Zhang Jiangang ( ੵ਄፻), aged 33, was appointed as an independent non-executive
Director of our Company with effect from the Listing Date.
Mr. Zhang has over 8 years of experience in technology, research, and entrepreneurship. He
served as a research assistant at the University of Hong Kong. Since May 2016, he has been the
founder and director of INCUS Company Ltd. in Hong Kong.
Mr. Zhang has received several prestigious awards throughout his career. In 2016, he was
awarded first prize at both the Qianhai Shenzhen-Hong Kong Innovation and Entrepreneurship
Competition and the Cross Straits Hong Kong and Macao Entrepreneurship Competition. He won
the first prize at Pitch@Palace in the PRC in 2019.
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Mr. Zhang obtained a bachelor’s degree in automation from the University of Science and
Technology of China (ኪҦஔɽኪ ) in the PRC in June 2013. He later obtained a master’s
degree in technology leadership and entrepreneurship from the Hong Kong University of Science
and Technology in Hong Kong in November 2016.
SENIOR MANAGEMENT
Our senior management is responsible for the day-to-day management of our business. The
following table provides information about members of our senior management:
Name Age Position(s)
Date of joining our
Group
Date of appointment as
a senior manager Roles and responsibilities
Dr. Ma Wei ( ৵ᐂ) ...... 69 Co-founder, executive Director
and vice chairman
October 2017 October 13, 2017 Responsible for architecting
technology framework and
business model, research and
development of new product
technology of our Group and
strategic planning of such
research and development
Dr. Hu Albert Sibo (౶௹) . 38 Executive Director and chief
executive officer
January 2018 December 30, 2023 Responsible for research and
development of system
algorithm and simulation,
business development,
marketing and production of
our Group
Dr. Ma Wei ( ৵ᐂ) is the co-founder, executive Director and the vice chairman of our
Company. See “— Directors — Executive Directors” in this section for his biographical details.
Dr. Hu Albert Sibo (౶௹) is the executive Director and chief executive officer of our
Company. See “— Directors — Executive Directors” in this section for his biographical details.
INTERESTS OF DIRECTORS AND SENIOR MANAGEMENT
Saved as disclosed above, none of our Directors and senior management had been a director
of any public company the securities of which were listed on any securities market in Hong Kong
or overseas in the three years immediately preceding the date of this prospectus. Save as disclosed
herein, to the best knowledge, information and belief of the Directors having made all reasonable
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inquiries, there are no other matters with respect to the appointment of our Directors that need to
be brought to the attention of the Shareholders, nor is there any information relating to our
Directors that is required to be disclosed pursuant to Rules 13.51(2)(h) to (v) of the Listing Rules.
As of the Latest Practicable Date, none of our Directors or senior management were related
to other Directors or senior management of our Company.
JOINT COMPANY SECRETARIES
Ms. Au Wing Sze ( ਜ൘་) has been appointed as one of our joint Company secretaries of
the Company with effect from the Listing Date. She is a manager of the listing services department
of TMF Hong Kong Limited, responsible for providing corporate secretarial and compliance
services to listed companies. She has over 10 years of experience in the corporate secretarial field.
Ms. Au is an associate member of both The Hong Kong Chartered Governance Institute and
The Chartered Governance Institute in the United Kingdom. She obtained a master of corporate
governance from Hong Kong Metropolitan University in Hong Kong.
Mr. Li Chunlin (؍݆)has been appointed as one of our joint Company secretaries of the
Company with effect from the Listing Date. Mr. Li has been the legal director and head of risk
control of our Company since November 2017.
Prior to joining our Group, Mr. Li worked at electrical control technical department of
Zoomlion Heavy Industry Science and Technology Co., Ltd. (ʮ̡ ) from
October 2011 to March 2013, and at Hunan Zoomlion Intelligent Technology Co., Ltd. (ʕᑌ
ʮ̡ ) from April 2013 to September 2014. He served as an intellectual property
lawyer and patent attorney at Hunan Tiandiren Law Firm (הfrom
September 2014 to November 2017.
Mr. Li obtained a bachelor’s degree in automation engineering from Ocean University of
China (ɽኪ ) in the PRC in June 2010 and a master’s degree in law from Hunan
University (ɽኪ ) in the PRC in July 2022.
BOARD COMMITTEES
Our Board delegates certain responsibilities to various committees. In accordance with the
relevant PRC laws and regulations and the Corporate Governance Code and the Listing Rules, our
Company has formed three Board committees, namely the Audit Committee, the Remuneration
Committee and the Nomination Committee.
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Audit Committee
We have established an 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 audit committee consists of three Directors, namely Prof. Tan Guangrong, Ms.
Yang Xi and Dr. Li Xiaoyuan. Prof. Tan Guangrong, being the chairperson of the audit committee,
holds the appropriate professional qualifications as required under Rules 3.10(2) and 3.21 of the
Listing Rules. The primary duties of the audit committee include, but are not limited to, the
following:
 reviewing and evaluating the work of external auditors;
 monitoring and making recommendations concerning the internal audit work of our
Company;
 reviewing and making recommendations concerning the financial reports of our
Company;
 evaluating the effectiveness of internal control work;
 ensuring coordination between the management, internal audit department and relevant
departments and external auditors; and
 performing other duties and responsibilities as assigned by our Board.
Remuneration Committee
We have established a remuneration committee with written terms of reference in compliance
with the Corporate Governance Code set out in Appendix C1 to the Listing Rules. The
remuneration committee consists of three Directors, namely Dr. Li Xiaoyuan, Dr. Ma Wei and Mr.
Zhang Jiangang. Dr. Li Xiaoyuan serves as the chairperson of the remuneration committee. The
primary duties of the remuneration committee include, but are not limited to, the following:
 reviewing and approving remuneration proposals of members of our senior management
in accordance with our Company’s policies and objectives as approved by our Board
from time to time;
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 making recommendations to our Board concerning our Company’s policy and structure
for all Directors’ and senior management remuneration and on the establishment of a
formal and transparent procedure for developing remuneration policy, including, but not
limited to, performance evaluation standards, procedures and evaluation systems;
 conducting the evaluation of the annual performance of all Directors and senior
management;
 monitoring remuneration payable to all Directors and senior management;
 reviewing and/or approving matters relating to share schemes under Chapter 17 of the
Listing Rules; and
 performing other duties and responsibilities as assigned by our Board.
Nomination Committee
We have established a nomination committee with written terms of reference in compliance
with the Corporate Governance Code set out in Appendix C1 to the Listing Rules. The nomination
committee consists of three Directors, namely Prof. Li Zexiang, Dr. Li Xiaoyuan and Mr. Zhang
Jiangang. Prof. Li Zexiang serves as the chairperson of the nomination committee. The primary
duties of the Nomination Committee include, but are not limited to, the following:
 reviewing and making recommendations to the Board on the composition and number of
our Board and senior management with reference to our Company’s business activities,
the scale of assets and shareholding structure;
 identifying individuals suitably qualified to become a member of our Board and senior
management, and making recommendations to our Board on the selection of individuals
nominated for directorships and senior management;
 reviewing the structure and diversity of the Board and selecting individuals to be
nominated as Directors;
 accessing and making recommendations to the selection of other senior management
appointed by our Board; and
 performing other duties and responsibilities as assigned by our Board.
DIRECTORS AND SENIOR MANAGEMENT
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REMUNERATION OF DIRECTORS AND SENIOR MANAGEMENT
We offer our executive Directors and senior management members, who are also the
Company’s employees, remuneration in the form of wages, salaries, bonuses, share-based
compensation, pension obligations, housing funds, medical insurances, other social insurances and
other benefits. Our independent non-executive Directors receive remuneration with reference to
their respective positions and duties, including being a member or the chairperson of Board
committees.
For the years ended December 31, 2022, 2023 and 2024 and the six months ended June 30,
2025, the aggregate amount of remuneration paid or payable to our Directors and our chief
executive officer amounted to approximately RMB3.3 million, RMB4.5 million, RMB16.4 million
and RMB15.6 million, respectively. Under the arrangement currently in force, we estimate the total
remuneration before taxation, including estimated share-based remuneration, to be accrued to our
Directors for the year ending December 31, 2025 to be approximately RMB32.1 million. The
actual remuneration of Directors in 2025 may be different from the expected remuneration.
For each of the years ended December 31, 2022, 2023 and 2024 and the six months ended
June 30, 2025, there were 2, 2, 2 and 2 Director and/or chief executive officer among the five
highest paid individuals, respectively. The total emoluments for the remaining individuals among
the five highest paid individuals amounted to approximately RMB3.6 million, RMB3.5 million,
RMB36.6 million and RMB48.6 million, for the years ended December 31, 2022, 2023 and 2024
and the six months ended June 30, 2025, respectively.
During the Track Record Period, no remuneration was paid to our Directors or any of the five
highest paid individuals as an inducement to join, or upon joining, our Group. During the Track
Record Period, no compensation was paid to, or receivable by, any of our Directors, former
directors or the five highest paid individuals for the loss of office as director of any member of our
Group or of any other office in connection with the management of the affairs of any member of
our Group. None of our Directors waived any emoluments during the Track Record Period. Save as
disclosed above, no other payments have been paid, or are payable, by our Company or any of our
subsidiaries to our Directors or the five highest paid individuals during the Track Record Period.
Our Board will review and determine the remuneration and compensation packages of our
Directors and senior management and will, following the Listing, receive recommendations from
our remuneration committee which will take into account salaries paid by comparable companies,
time commitment and responsibilities of our Directors and senior management and the
performance of our Group.
DIRECTORS AND SENIOR MANAGEMENT
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CORPORATE GOVERNANCE
Our Company is committed to achieving high standards of corporate governance with a view
to safeguarding the interests of our Shareholders. To accomplish this, our Company complies or
intends to comply with the corporate governance requirements under the Corporate Governance
Code set out in Appendix C1 to the Listing Rules after the Listing.
BOARD DIVERSITY POLICY
In order to enhance the effectiveness of our Board and to maintain the high standard of
corporate governance, we have adopted a Board Diversity Policy which sets out the objective and
approach to achieve and maintain diversity of our Board. Pursuant to the Board Diversity Policy,
we seek to achieve Board diversity through the consideration of a number of factors when
selecting the candidates to our Board, including, but not limited to, gender, skills, age, professional
experience, knowledge, cultural background, education background, ethnicity and length of
service. The ultimate decision of the appointment will be based on merit and the contribution
which the selected candidates will bring to our Board.
Our board currently consists of 1 female Director and 7 male Directors with nearly half
holding doctorate degrees. Our Directors have a balanced mix of knowledge and skills, including
overall management and strategic development, quality assurance and control, finance and
accounting and corporate governance in addition to industry experience relevant to our Group’s
operations and business. They obtained degrees in various majors including economics, chemistry,
business management, and engineering. This diverse academic background allows the Board to
approach challenges and opportunities from multiple angles, fostering innovative solutions and
comprehensive strategies. We have three independent non-executive Directors with different
industry backgrounds, representing more than one third of the members of our Board. Furthermore,
our Board has a diverse age and gender representation. 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.
Our Nomination Committee is responsible for reviewing the structure and diversity of the
Board and selecting individuals to be nominated as Directors. After the Listing, our Nomination
Committee will monitor and evaluate the implementation of the Board Diversity Policy from time
to time to ensure its continued effectiveness, and, when necessary, make any revisions that may be
required and recommend any such revisions to our Board for consideration and approval. The
Nomination Committee will also include in annual reports a summary of the Board Diversity
Policy, including any measurable objectives set for implementing the Board Diversity Policy and
the progress on achieving these objectives.
DIRECTORS AND SENIOR MANAGEMENT
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CONFIRMATION FROM OUR DIRECTORS
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.
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 on October 18, 2024, October 21, 2024 and October 25,
2024 (as the case may be) and (ii) understands the requirements under the Listing Rules that are
applicable to him or her as a director of a listed issuer under the Listing Rules and the possible
consequences of making a false declaration or giving false information to the Stock Exchange.
Rule 3.13 of the Listing Rules
Each of the independent non-executive Directors has confirmed (i) his/her independence as
regards each of the factors referred to in Rules 3.13(1) to (8) of the Listing Rules, (ii) he/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/her
independence at the time of his/her appointment.
COMPLIANCE ADVISOR
We have appointed Gram Capital Limited as our Compliance Advisor pursuant to Rules
3A.19 of the Listing Rules. The Compliance Advisor will provide us with guidance and advice as
to compliance with the Listing Rules and other applicable laws, rules, codes and guidelines.
Pursuant to Rule 3A.23 of the Listing Rules, the Compliance Advisor will advise our Company in
certain circumstances, including:
(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 and share repurchases;
DIRECTORS AND SENIOR MANAGEMENT
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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 our business activities, developments or results
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 its listed securities or any other
matters in accordance with Rule 13.10 of the Listing Rules.
Pursuant to Rule 3A.24 of the Listing Rules, the Compliance Advisor will, on a timely basis,
inform our Company of any amendment or supplement to the Listing Rules that are announced by
the Hong Kong Stock Exchange. The Compliance Advisor will also inform our Company of any
new or amended law, regulation or code in Hong Kong applicable to us, and advise us on the
continuing requirements under the Listing Rules and applicable laws and regulations.
The term of the appointment of our Compliance Advisor will 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.
DIRECTORS AND SENIOR MANAGEMENT
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CONTROLLING SHAREHOLDERS
As of the Latest Practicable Date, Prof. Li is indirectly interested in approximately
16,750,130 Shares, representing approximately 43.64% of our total issued share capital, through:
(i) 11,433,151 Shares (representing approximately 29.81% of the voting rights in our Company)
held by NovoDriv HK, the general partner of which is NovoDriv Limited, which in turn is
wholly-owned by Prof. Li; (ii) 4,883,250 Shares held by Changsha Gangwan (representing
approximately 12.72% of the voting rights in our Company) which (1) is directly held as to 99%
by Prof. Li as the limited partner, and (2) is held as to 1% by Dongguan Intelligence as the general
partner, which in turn is controlled by Prof. Li; (iii) 290,750 Shares held by CWB Startup HK
(representing approximately 0.76% of the voting rights in our Company) which is wholly-owned
by Clear Water Bay Startup Fund LP, the general partner of which is Clear Water Bay Startup Fund
GP, which in turn is held as to approximately 57% by Prof. Li; and (iv) 132,979 Shares held by
Changsha Shengyu (representing approximately 0.35% of the voting rights in our Company), the
majority of the partnership interest of which is held by Dongguan Yunhe, which in turn is
wholly-owned by CWB Startup HK.
Accordingly, Prof. Li, NovoDriv HK, NovoDriv Limited, Changsha Gangwan, Dongguan
Intelligence, CWB Startup HK, Clear Water Bay Startup Fund GP, Clear Water Bay Startup Fund
LP, and Changsha Shengyu and Dongguan Yunhe constitute a group of Controlling Shareholders of
the Company.
Immediately following the completion of the Global Offering (assuming the Over-allotment
Option is not exercised), the Controlling Shareholders will be entitled to exercise approximately
38.25% of the voting rights in our Company, and will remain as the Controlling Shareholders upon
the Listing.
See “History, Development and Corporate Structure” and “Substantial Shareholders” in this
prospectus for details.
INTERESTS OF THE CONTROLLING SHAREHOLDERS IN OTHER BUSINESSES
Each of our Controlling Shareholders confirmed that as of the Latest Practicable Date, he/it
did not have any interest in other business, apart from the business of our Group, 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.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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INDEPENDENCE FROM OUR CONTROLLING SHAREHOLDERS
Our Directors consider that we are capable of carrying on our business independently from
the Controlling Shareholders and their respective close associates after the Listing, taking into
consideration the factors below.
Management Independence
Our business is managed and conducted by our Board and senior management. Upon Listing,
our Board consists of eight Directors, comprising two executive Directors, three non-executive
Directors and three independent non-executive Directors. Prof. Li, a Controlling Shareholder, is
also a member of the Board as a non-executive Director. For more details, see “Directors and
Senior Management”.
Ms. Yang Xi, our non-executive Director, also held positions as director and/or general
manager in certain companies outside of the Group controlled by Prof. Li, our Controlling
Shareholder. Save as disclosed above, none of our Directors or members of senior management
serves as directors or members of senior management in any close associates of our Controlling
Shareholders.
Our Directors consider that we are able to carry on our business independently from the
Controlling Shareholders from a management perspective for the following reasons:
(a) our executive Directors and senior management members do not hold any role as an
executive director or member of senior management in any close associates of our
Controlling Shareholders. Although Ms. Yang Xi held directorships and/or general
manager roles in certain companies outside of the Group controlled by Prof. Li, she is
only a Non-executive Director of our Company and is not involved in the daily
operation of our Company;
(b) our daily management and operations are carried out by a senior management team, 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
Group. See “Directors and Senior Management” for details of the industry experience of
our senior management team;
(c) 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 our Director and his/her personal
interests. In the event that there is a potential conflict of interest arising out of any
transaction to be entered into between our Group and a Director and/or his/her associate,
he/she is required to declare the nature of such interest before voting at the relevant
Board meetings of our Company in respect of such transactions and the interested
Director shall abstain from voting and shall not be counted towards the quorum for the
voting;
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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(d) we have three independent non-executive Directors with extensive experience in their
respective areas of expertise to ensure that the decisions of our Board are made after
due consideration of independent and impartial opinions and in the best interests of our
Company and our Shareholders as a whole. Certain matters of our Company must
always be referred to the independent non-executive Directors for review and approval;
and
(e) we have adopted a series of corporate governance measures to manage conflicts of
interest, if any, between our Group and the Controlling Shareholders which would
support our independent management. See “— Corporate Governance” below for details.
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 Group independently from the
Controlling Shareholders and their respective close associates after the Listing.
Operational Independence
We do not rely on the Controlling Shareholders and their respective close associates for our
daily operations. While our business operations and growth prospects might be affected by the
experience and abilities of our founder and non-executive Director, Prof. Li, and our senior
management and key personnel, we have our own departments specializing in business
development, sales and marketing, financing, logistics, human resources, administration, internal
audit, information technology, legal and compliance, or company secretarial functions which have
been in operation and are expected to continue to operate separately and independently from the
Controlling Shareholders and their respective close associates. In addition, we have our own
headcount of employees for our operations and management for human resources.
We have independent access to suppliers and customers and an independent management
team to handle our day-to-day operations. We also have sufficient capital, facilities, equipment and
employees, administrative and corporate governance infrastructure, to operate the business
independently. We are also in possession of all relevant licenses, certificates, facilities, intellectual
property rights and approvals and permits from the relevant regulatory authorities necessary to
carry on and operate our principal businesses and we have sufficient operational capacity in terms
of capital and employees to operate independently.
Based on the above, our Directors believe that we are able to operate independently of our
Controlling Shareholders and their respective close associates.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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Financial Independence
We have an independent financial system and make financial decisions according to our
Group’s own business needs. We have our own internal control and accounting systems and an
independent finance department in charge of our treasury function and making financial decisions
based on our Group’s needs. Our Company maintains bank accounts independently and does not
share any bank account with our Controlling Shareholders. Our Company makes tax registration
and pays tax independently with its own funds. As such, our Company’s financial functions, such
as cash and accounting management, invoices and bills, operate independently from our
Controlling Shareholders and their respective close associates. We do not expect to rely on the
Controlling Shareholders and their respective close associates for financing after the Listing as we
expect that our working capital will be funded by the cash, cash equivalents on hand as well as the
proceeds from the Global Offering.
In addition, we are capable of obtaining financing from Independent Third Parties, if
necessary, without relying on any guarantee or security provided by our Controlling Shareholders
or their respective close associates. As of the Latest Practicable Date, there were no outstanding
loans or guarantee provided by or granted to the Controlling Shareholders or their respective close
associates.
Based on the above, our Directors believe that we are capable of carrying on our business
independently from, and do not place undue reliance on the Controlling Shareholders or their
respective close associates after the Listing.
CORPORATE GOVERNANCE
Our Company and Directors are committed to upholding and implementing the highest
standards of corporate governance and recognize the importance of protecting the rights and
interests of all Shareholders, including the rights and interests of our minority Shareholders. 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.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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Our Directors recognize the importance of implementing good corporate governance and
effective internal control measures in protection of our Shareholders’ interests. We would adopt the
following measures to safeguard good corporate governance standards and to avoid potential
conflict of interests between our Group and the Controlling Shareholders and their respective close
associates:
(a) where a Shareholders’ meeting is to be held for considering proposed transactions in
which the Controlling Shareholders or any of their respective associates has a material
interest, the Controlling Shareholders will not vote on the resolutions and shall not be
counted in the quorum in the voting;
(b) as part of our preparation for the Listing, 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 abstain 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;
(c) our Company has established internal control mechanisms to identify connected
transactions. Upon the Listing, if our Group enters into connected transactions with the
Controlling Shareholders or any of their respective associates, we will comply with the
applicable Listing Rules;
(d) we are committed that our Board shall include a balanced composition of executive
Directors and non-executive Directors (including independent non-executive Directors).
We have appointed three 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 with the exercise of their
independent judgment in any material manner, and (iii) will be able to provide an
impartial and external opinion to protect the interests of our Shareholders as a whole.
See “Directors and Senior Management” for details of the independent non-executive
Directors;
(e) where our Directors reasonably request the advice of independent professionals or
advisors, such as financial advisors, valuers or legal advisors, the appointment of such
independent professionals or advisors will be made at our Company’s expenses;
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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(f) we have appointed Gram Capital Limited as our Compliance Advisor to provide us with
advice and guidance in respect of compliance with the applicable laws and regulations
and the Listing Rules, including various requirements relating to Directors’ duties and
corporate governance; and
(g) we have established our Audit Committee, Remuneration Committee and Nomination
Committee with written terms of reference in compliance with the Listing Rules and the
Corporate Governance Code.
Based on the above, our Directors are satisfied that sufficient corporate governance measures
have been put in place to manage conflicts of interest between our Group and the Controlling
Shareholders, and to protect minority Shareholders’ interests after the Listing.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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This section presents certain information regarding our share capital before and upon
completion of the Global Offering.
BEFORE THE GLOBAL OFFERING
As of the Latest Practicable Date, the registered capital of our Company was
RMB38,381,330, comprising 38,381,330 Domestic Unlisted Shares of nominal value RMB1.00
each.
UPON COMPLETION OF THE GLOBAL OFFERING
Immediately following the Global Offering (assuming the Over-allotment Option is not
exercised), the share capital of our Company will be as follows:
Description of Shares Number of Shares
Approximate
percentage to
total share capital
(%)
Domestic Unlisted Shares in issue ...................... 1,345,418 3.07
H Shares converted from Domestic Unlisted Shares ........ 37,035,912 84.58
H Shares to be issued pursuant to the Global Offering ...... 5,407,980 12.35
Total ............................................ 43,789,310 100
Assuming the Over-allotment Option is exercised in full, the share capital of our Company
immediately following the Global Offering will be as follows:
Description of Shares Number of Shares
Approximate
percentage to
total share capital
(%)
Domestic Unlisted Shares ............................ 1,345,418 3.02
H Shares to be converted from Domestic Unlisted Shares .... 37,035,912 83.04
H Shares to be issued pursuant to the Global Offering ...... 6,219,170 13.94
Total ............................................ 44,600,500 100
SHARE CAPITAL
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RANKING
Upon completion of the Global Offering, the Shares will consist of H Shares and Domestic
Unlisted Shares. H Shares and Domestic Unlisted Shares are all ordinary Shares in the share
capital of our Company. However, apart from certain qualified domestic institutional investors in
the PRC, the qualified PRC investors under the Shanghai — Hong Kong Stock Connect or the
Shenzhen — Hong Kong Stock Connect and other persons who are entitled to hold our H Shares
pursuant to relevant PRC laws and regulations or upon approvals of any competent authorities, H
Shares generally cannot be subscribed for by or traded between legal or natural persons of the
PRC.
Domestic Unlisted Shares and H Shares will rank pari passu with each other in all respects
and, in particular, will rank equally for all dividends or distributions declared, paid or made after
the date of this prospectus. All dividends in respect of the H Shares are to be paid by us in Hong
Kong dollars or in the form of H Shares.
DOMESTIC UNLISTED SHARES AND H SHARES
Upon the completion of the Global Offering and the Conversion of Domestic Unlisted Shares
into H Shares, the Shares will consist of Domestic Unlisted Shares and H Shares. Domestic
Unlisted Shares and H Shares are all ordinary Shares in the share capital of our Company.
Apart from certain qualified domestic institutional investors in the PRC, the qualified PRC
investors under the Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock
Connect and other persons who are entitled to hold our H Shares pursuant to relevant PRC laws
and regulations or upon approvals of any competent authorities (such as our certain existing
shareholders the Domestic Unlisted Shares held by whom will be converted into H Shares
according to the approval of the CSRC), H Shares generally cannot be subscribed for by or traded
between legal or natural PRC persons.
CONVERSION OF DOMESTIC UNLISTED SHARES INTO H SHARES
If any of the Domestic Unlisted Shares are to be converted, listed and traded as H Shares on
the Stock Exchange, such conversion, listing and trading will need the approval of the relevant
PRC regulatory authorities, including the CSRC, and the approval of the Stock Exchange.
SHARE CAPITAL
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Registration with the CSRC and Full Circulation Application
In accordance with the Trial Administrative Measures and related guidelines, H-share listed
companies which apply for the conversion of domestic unlisted shares into H shares for listing and
circulation on the Hong Kong Stock Exchange shall register with the CSRC by filing materials on
key compliance issues. An unlisted domestic joint stock company may apply for “full circulation”
when applying for an overseas initial public offering.
We applied for a “full circulation” filing when filing with the CSRC for an overseas listing
on November 12, 2024, and submitted the filing reports, authorization documents of the
shareholders of Domestic Unlisted Shares which applied for the H-share “full circulation”,
undertaking on the compliance of share acquisition and other documents in accordance with the
requirements of the CSRC.
We have received the filing notice from the CSRC dated October 29, 2025 in relation to the
registration of the overseas listing and “full circulation”, pursuant to which (1) we are approved to
issue no more than 7,789,150 H Shares with a nominal value of RMB1.00 each, which are all
ordinary shares, and we may be listed on the Main Board of the Hong Kong Stock Exchange; (2)
certain Shareholders (the “ Full Circulation Participating Shareholders ”) could convert
37,035,912 Domestic Unlisted Shares into H Shares on a one-for-one basis (“ Conversion of
Domestic Unlisted Shares into H Shares ”) upon the completion of the Global Offering (“ Full
Circulation Application of the Company ”).
Listing Approval by the Hong Kong Stock Exchange
We have applied to the Listing Committee of the Stock Exchange for the granting of listing
of, and permission to deal in, our H Shares to be issued pursuant to the Global Offering, and the H
Shares to be converted from 37,035,912 Domestic Unlisted Shares on the Hong Kong Stock
Exchange, which is subject to the approval by the Stock Exchange.
We will perform the following procedures for the conversion of Domestic Unlisted Shares
into H Shares after receiving the approval of the Hong Kong Stock Exchange: (1) giving
instructions to our H Share Registrar regarding relevant share certificates of the converted H
Shares; and (2) enabling the converted H Shares to be accepted as eligible securities by HKSCC
for deposit, clearance and settlement in CCASS.
SHARE CAPITAL
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Domestic Procedures
The Full Circulation Participating Shareholders may only deal the Shares upon completion of
the below arrangement procedures for the registration, deposit and transaction settlement in
relation to the conversion and listing:
(i) We will appoint China Securities Depository and Clearing Corporation Limited
(“CSDC”) as the nominal holder to deposit the relevant securities at CSDC (Hong
Kong), which will then deposit the securities at HKSCC in its own name. CSDC, as the
nominal holder of the Full Circulation Participating Shareholders, shall handle all
custody, maintenance of detailed records, cross-border settlement and corporate actions,
etc. relating to the converted H Shares for the Full Circulation Participating
Shareholders;
(ii) According to the Notice of SAFE on Issues Concerning the Foreign Exchange
Administration of Overseas Listing (ྤ̮ɪ̹̮ි၍ଣϞᗫਪᕚ
), the Full Circulation Participating Shareholders shall complete the overseas
shareholding registration with the local foreign exchange administration bureau before
the Shares are sold, and after the overseas shareholding registration, open a specified
bank account for the holding of overseas shares by domestic investors at a domestic
bank with relevant qualifications and open a fund account for the H Share “Full
circulation” at the Domestic Securities Company. The Domestic Securities Company
shall open a securities trading account for the H Share “Full circulation” at the Hong
Kong Securities Company; and
(iii) The Full Circulation Participating Shareholders shall submit trading orders of the
converted H Shares through the Domestic Securities Company. Trading orders of the
Full Circulation Participating Shareholders for the relevant Shares will be submitted to
the Stock Exchange through the securities trading account opened by the Domestic
Securities Company at the Hong Kong Securities Company. Upon completion of the
transaction, settlements between each of the Hong Kong Securities Company and CSDC
(Hong Kong), CSDC (Hong Kong) and CSDC, CSDC and the Domestic Securities
Company, and the Domestic Securities Company and the Full Circulation Participating
Shareholders, will all be conducted separately.
As a result of the conversion, the shareholding of the relevant Full Circulation Participating
Shareholders in our Domestic Unlisted Shares shall be reduced by the number of the Domestic
Unlisted Shares converted and the number of H Shares shall be increased by the number of
converted H Shares.
SHARE CAPITAL
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A Shareholder holding Domestic Unlisted Shares not converted into H Shares can work with
the Company according to the Articles of Association and follow the procedures set out in this
Prospectus to convert the Domestic Unlisted Shares into H Shares after the Listing if they want,
provided that such conversion of Domestic Unlisted Shares into and listing and trading of H
Shares will be subject to the approval of the relevant PRC regulatory authorities, including the
CSRC, the approval of the Stock Exchange and the satisfaction of the public float requirement
under the Listing Rules by the Company.
RESTRICTION ON TRANSFER OF SHARES ISSUED PRIOR TO THE GLOBAL
OFFERING
Pursuant to the PRC Company Law, our Shares issued prior to the Listing shall not be
transferred within 12 months from the Listing Date.
Shares transferred by our Directors and members of the senior management each year during
their term of office shall not exceed 25% of their total respective shareholdings in our Company
unless otherwise permitted by applicable laws and regulations. The Shares that the aforementioned
persons hold in our Company cannot be transferred within half a year after they leave their
positions as Directors and members of the senior management in our Company.
For details of the lock-up undertaking given by the Controlling Shareholders pursuant to
Rules 10.07 and 18C.13 of the Listing Rules see “Underwriting — Underwriting Arrangements and
Expenses — The Hong Kong Public Offering — Undertakings to the Stock Exchange pursuant to
the Listing Rules — Undertakings by the Controlling Shareholders”.
CIRCUMSTANCES UNDER WHICH GENERAL MEETINGS ARE REQUIRED
Pursuant to the PRC Company Law and the terms of the Articles of Association, our
Company may from time to time by special resolution of shareholders, among others, increase its
capital or decrease its capital or repurchase of shares. For details, see “Appendix VI — Summary
of Articles of Association”.
SHAREHOLDERS’ APPROV AL FOR THE GLOBAL OFFERING
Approval from holders of the Shares is required for the Company to issue H Shares and seek
the listing of H Shares on the Hong Kong Stock Exchange. The Company has obtained such
approval at the Shareholders’ general meeting held on September 23, 2024.
SHARE CAPITAL
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--- page 372 ---
SHARE INCENTIVE SCHEME
We adopted the Share Incentive Scheme. See “Statutory and General Information — D. Share
Incentive Scheme” in Appendix VII to this prospectus.
GENERAL MANDATES TO ISSUE SHARES
Subject to the Global Offering becoming unconditional, our Directors have been granted
general unconditional mandates to issue our Shares. See “Appendix VII — Statutory and General
Information — A. Further Information about our Company and our Subsidiaries — 4. Resolutions
of our Shareholders” for further details.
SHARE CAPITAL
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--- page 373 ---
So far as our Directors are aware, immediately following the completion of the Global
Offering (assuming the Over-allotment Option is not exercised), the following persons will have
interests and/or short positions in the Shares or underlying shares of our Company which would
fall to be disclosed pursuant to the provisions of Divisions 2 and 3 of Part XV of the SFO, or,
directly or indirectly, be interested in 10% or more of the nominal value of any class of share
capital carrying the rights to vote in all circumstances at general meetings of our Company:
As of the Latest Practicable Date
Immediately following the completion of
the Global Offering (assuming the Over-allotment Option is not
exercised)
Name of Shareholder Nature of Interest
Class and Number
of Shares (1)
Approximate
percentage of
interest in our
Company
Class and Number
of Shares (1)
Approximate
percentage of
shareholding in
the relevant class
of Shares (2)
Approximate
percentage of
shareholding in
the total/issued
share capital
of our Company (2)
Prof. Li (3) ...... Interest in controlled
corporations
16,750,130
Domestic
Unlisted
Shares
43.64% 16,750,130
H Shares
39.46% 38.25%
NovoDriv Limited (4) . Interest in controlled
corporation
11,443,151
Domestic
Unlisted
Shares
29.81% 11,443,151
H Shares
26.96% 26.13%
NovoDriv HK .... Beneficial owner 11,443,151
Domestic
Unlisted
Shares
29.81% 11,443,151
H Shares
26.96% 26.13%
Dongguan
Intelligence (5) ...
Interest in controlled
corporation
4,883,250
Domestic
Unlisted
Shares
12.72% 4,883,250
H Shares
11.51% 11.15%
Changsha Gangwan .. Beneficial owner 4,883,250
Domestic
Unlisted
Shares
12.72% 4,883,250
H Shares
11.51% 11.15%
SUBSTANTIAL SHAREHOLDERS
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--- page 374 ---
As of the Latest Practicable Date
Immediately following the completion of
the Global Offering (assuming the Over-allotment Option is not
exercised)
Name of Shareholder Nature of Interest
Class and Number
of Shares (1)
Approximate
percentage of
interest in our
Company
Class and Number
of Shares (1)
Approximate
percentage of
shareholding in
the relevant class
of Shares (2)
Approximate
percentage of
shareholding in
the total/issued
share capital
of our Company (2)
Beijing HongShan .. Beneficial owner 4,070,500
Domestic
Unlisted
Shares
10.61% 4,070,500
H Shares
9.59% 9.30%
Xinding Capital (6) .. Interest in controlled
corporation
3,710,820
Domestic
Unlisted
Shares
9.67% 3,710,820
H Shares
8.74% 8.47%
Ruishi Capital (7) ... Beneficial owner 1,056,557
Domestic
Unlisted
Shares
2.75% 129,464
H Shares
0.31% 0.30%
927,093
Domestic
Unlisted
Shares
68.91% 2.12%
Chengdu Technology
VC .........
Beneficial owner 231,426
Domestic
Unlisted
Shares
0.60% 231,426
Domestic
Unlisted
Shares
17.20% 0.53%
Ceyuan Guangyi
Digital Fund ....
Beneficial owner 140,357
Domestic
Unlisted
Shares
0.37% 140,357
Domestic
Unlisted
Shares
10.43% 0.32%
Notes:
(1) All interests stated are long positions.
SUBSTANTIAL SHAREHOLDERS
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--- page 375 ---
(2) The calculation is based on the total number of 1,345,418 Domestic Unlisted Shares in issue, 37,035,912 H Shares
to be converted from Domestic Unlisted Shares in issue and 5,407,980 H Shares to be issued pursuant to the Global
Offering (assuming the Over-allotment Option is not exercised).
(3) Under the SFO, Prof. Li is deemed to be interested in (i) the 11,443,151 Shares held by NovoDriv HK, the general
partner of which is NovoDriv Limited, which in turn is wholly-owned by Prof. Li; (ii) the 4,883,250 Shares held by
Changsha Gangwan, which is held (1) is directly held as to 99% by Prof. Li as the limited partner, and (2) is held
as to 1% by Dongguan Intelligence as the general partner, which in turn is controlled by Prof. Li; (iii) the 290,750
Shares held by CWB Startup HK, which is wholly-owned by Clear Water Bay Startup Fund LP, the general partner
of which is Clear Water Bay Startup Fund GP, which in turn is held as to approximately 57% by Prof. Li; and (iv)
the 132,979 Shares held by Changsha Shengyu, the majority of the partnership interest of which is held by
Dongguan Yunhe, which in turn is wholly-owned by CWB Startup HK.
(4) Under the SFO, NovoDriv Limited is deemed to be interested in the 11,443,151 Shares held by NovoDriv HK as its
general partner.
(5) Under the SFO, Dongguan Intelligence is deemed to be interested in the 4,883,250 Shares held by Changsha
Gangwan as its general partner.
(6) Under the SFO, Xinding Capital is deemed to be interested in the 3,710,820 Shares held by Xinding No. 1, Xinding
No. 6, Xinding No. 18, Xinding No. 19, Xinding No. 20 and Xinding No. 36.
(7) Under the SFO, Ruishi Capital is deemed to be interested in the 1,056,557 Shares held by Zhitu No. 1 and
Ruichuang Zhitu, among which 129,464 Domestic Unlisted Shares held by Zhitu No. 1 will be converted into H
Shares and 927,093 Domestic Unlisted Shares held by Ruichuang Zhitu will remain unconverted upon the Listing.
Save as disclosed above and in section headed “Appendix VII — Statutory and General
Information — C. Further Information about our Directors and Senior Management”, our Directors
are not aware of any other person who will, immediately following the completion of the Global
Offering (assuming the Over-allotment Option is not exercised), have any interest and/or short
positions in the Shares or underlying shares of our Company which would fall to be disclosed to
the Company pursuant to the provisions of Divisions 2 and 3 of Part XV of the SFO, or, who is,
directly or indirectly, interested in 10% or more of the nominal value of any class of our share
capital carrying rights to vote in all circumstances at general meetings of our Company. Our
Directors are not aware of any arrangement which may at a subsequent date result in a change of
control of our Company or any other member of our Company.
SUBSTANTIAL SHAREHOLDERS
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--- page 376 ---
THE CORNERSTONE INVESTMENTS
We have entered into cornerstone investment agreements (each a “ Cornerstone Investment
Agreement ”, and together the “ Cornerstone Investment Agreements ”) with the cornerstone
investors set out below (each a “ Cornerstone Investor ”, and together the “ Cornerstone
Investors ”), pursuant to which the Cornerstone Investors have agreed to, subject to certain
conditions, subscribe for such number of Offer Shares (rounded down to the nearest whole board
lot of 10 H Shares) which may be purchased at the Offer Price with an aggregate amount of
approximately HK$546.10 million, calculated based on the exchange rate set out in the section
headed “Information about this Prospectus and the Global Offering — Exchange Rate Conversion”
in this prospectus (exclusive of brokerage, SFC transaction levy, AFRC transaction levy and Stock
Exchange trading fee) (the “ Cornerstone Investment ”).
Based on the Offer Price of HK$263.0 per Offer Share, the total number of Offer Shares to
be subscribed for by the Cornerstone Investors would be 2,076,390, representing (i) approximately
38.39% of the Offer Shares pursuant to the Global Offering and approximately 4.74% of the total
issued share capital of the Company immediately following the completion of the Global Offering
(assuming the Over-allotment Option is not exercised); or (ii) approximately 33.39% of the Offer
Shares pursuant to the Global Offering and approximately 4.66% of the total issued share capital
of the Company immediately following the completion of the Global Offering (assuming the
Over-allotment Option is exercised in full).
The Company is of the view that, (i) the Cornerstone Investment will ensure a reasonable size
of solid commitment at the beginning of the marketing period of the Global Offering and will
provide confidence to the market; and (ii) the Cornerstone Investment demonstrates our
Cornerstone Investors’ confidence in the Company and its business prospect and it will help raise
the profile of the Company. The Company became acquainted with each of the Cornerstone
Investors through the business network of the Group, the Overall Coordinators or the other CMIs.
The Cornerstone Investment will form part of the International Offering, and save as
otherwise obtained consent from the Stock Exchange, the Cornerstone Investors (and, for
Cornerstone Investors who will subscribe for our Offer Shares through qualified domestic
institutional investor (“ QDII”), both the Cornerstone Investors and the QDIIs), and their respective
close associates will not subscribe for any Offer Shares under the Global Offering other than
pursuant to the Cornerstone Investment Agreements. The Offer Shares to be subscribed for by the
Cornerstone Investors (and, for Cornerstone Investors who will subscribe for our Offer Shares
through QDII, the QDIIs) will rank pari passu in all respects with the fully paid H Shares in issue
following the completion of the Global Offering and to be listed on the Stock Exchange. The Offer
Shares to be subscribed for by the Cornerstone Investors will be counted towards the public float
of the Company under Rule 8.08 of the Listing Rules.
CORNERSTONE INVESTORS
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--- page 377 ---
Immediately following the completion of the Global Offering, (i) none of the Cornerstone
Investors will become a substantial shareholder of the Company; (ii) none of the Cornerstone
Investors will have any Board representation in the Company solely by virtue of its cornerstone
investment, and (iii) equity interests in the Company being beneficially owned by the three largest
public Shareholders will be less than 50% for the purpose of Rule 8.08(3) of the Listing Rules.
To the best knowledge of the Company, (i) each of the Cornerstone Investors (and, for
Cornerstone Investors who will subscribe for our Offer Shares through QDII, both the Cornerstone
Investors the QDIIs) is an independent third party; (ii) none of the Cornerstone Investors (and, for
Cornerstone Investors who will subscribe for our Offer Shares through QDII, the QDIIs) is
accustomed to taking instructions from the Company, the Directors, chief executive of the
Company, the Controlling Shareholders, substantial Shareholders or existing Shareholders or any
of its subsidiaries or their respective close associates in relation to the acquisition, disposal,
voting, or other disposition of H Shares registered in its name or otherwise held by it; and (iii)
none of the subscription for the relevant Offer Shares by the Cornerstone Investors is financed by
the Company, the Directors, chief executive of the Company, the Controlling Shareholders,
substantial Shareholders or existing Shareholders except for Xiangjiang State Investment (being
Xiangjiang Investment and Xiangjiang Intelligent Innovation, each being our existing
Shareholders) or any of its subsidiaries or their respective close associates for the purpose of
subscription of the Offer Shares.
To the best knowledge of the Company and as confirmed by each of the Cornerstone
Investors, they made their own independent decisions to enter into the Cornerstone Investment
Agreements, and their subscriptions under the Cornerstone Investment would be financed by their
own internal resources or (in the case of the Cornerstone Investor which is funds or investment
manager) the assets managed for its investors. None of the Cornerstone Investors or their
shareholder(s) are listed on any stock exchanges. The Cornerstone Investors have also confirmed
that all necessary approvals have been obtained with respect to the Cornerstone Investment and
that no specific approval from any stock exchange (if relevant) or their shareholders is required for
the Cornerstone Investment. Other than a guaranteed allocation of the relevant Offer Shares at the
final Offer Price, the Cornerstone Investors do not have any preferential rights in the Cornerstone
Investment Agreements compared with other public Shareholders. Other than the Cornerstone
Investment Agreements, as confirmed by each of the Cornerstone Investors, there are no side
agreements or arrangements between us and the Cornerstone Investors or any benefit, direct or
indirect, conferred on the Cornerstone Investors by virtue of or in relation to the Listing, other
than a guaranteed allocation of the relevant Offer Shares at the Offer Price.
The total number of Offer Shares to be subscribed for by the Cornerstone Investors (and, for
Cornerstone Investors who will subscribe for our Offer Shares through QDII, the QDIIs) under the
Cornerstone Investment may be affected by reallocation of the Offer Shares between the
CORNERSTONE INVESTORS
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--- page 378 ---
International Offering and the Hong Kong Public Offering in the event of over-subscription under
the Hong Kong Public Offering, as described in the paragraphs headed “Structure of the Global
Offering — The Hong Kong Public Offering — Reallocation” in this prospectus. The number of
Offer Shares to be acquired by each Cornerstone Investor may be reduced on a pro rata basis in
accordance with the terms of the Cornerstone Investment Agreements to satisfy the public demands
under the Hong Kong Public Offering, after taking into account the requirements under Practice
Note 15 to the Listing Rules as well as the discretion of the Overall Coordinators (for themselves
and on behalf of the International Underwriters) to exercise the Over-allotment Option. Details of
the actual number of Offer Shares to be allocated to each of the Cornerstone Investors will be
disclosed in the allotment results announcement to be issued by the Company on or around
December 17, 2025.
Pursuant to the Cornerstone Investment Agreements, the Overall Coordinators (for themselves
and on behalf of the International Underwriters) has the discretion to effect a delayed delivery of
the Offer Shares to be subscribed for by each of the Cornerstone Investors on a date later than the
Listing Date, subject to the conditions contained therein. Such delayed delivery arrangement is in
place to facilitate the over-allocation in the International Offering. There will be no delayed
delivery if there is no over-allocation in the International Offering. There will be no deferred
settlement of the Offer Shares to be subscribed by the Cornerstone Investors. Each of the
Cornerstone Investors has agreed to pay for the relevant Offer Shares that they have subscribed
before dealings in the Company’s H Shares commence on the Stock Exchange, irrespective of
whether there is delayed delivery of the H Shares.
CORNERSTONE INVESTORS
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--- page 379 ---
THE CORNERSTONE INVESTORS
The table below sets out details of the Cornerstone Investment:
Assuming the Over-Allotment
Option is not exercised
Assuming the Over-Allotment
Option is fully exercised
Cornerstone Investor Subscription amount (1)
Number of Offer
Shares to be
acquired (2)
Approximate %
of the Offer
Shares
Approximate %
of the issued
share capital
Approximate %
of the Offer
Shares
Approximate %
of the issued
share capital
Xiangjiang Zhicheng .. HK$425,706,747 1,618,650 29.93% 3.70% 26.03% 3.63%
Zhijia No. 1 ....... RMB70,000,000 292,860 5.42% 0.67% 4.71% 0.66%
ICBCUBS ........ US$1,000,000 29,610 0.55% 0.07% 0.48% 0.07%
ICBCUBSI ........ US$2,000,000 59,230 1.10% 0.14% 0.95% 0.13%
QHKY Qunwei ..... HK$20,000,000 76,040 1.41% 0.17% 1.22% 0.17%
Total ........... HK$546,100,893 2,076,390 38.39% 4.74% 33.39% 4.66%
Notes:
(1) Calculated based on the exchange rate set out in the section headed “Information about this Prospectus and the
Global Offering — Exchange Rate Conversion” in this prospectus. The actual investment amount may vary due to
the exchange rate prescribed in the relevant Cornerstone Investment Agreement.
(2) Rounded down to the nearest whole board lot of 10 H Shares.
(3) Assuming no other changes are made to the issued share capital of our Company between the Latest Practicable
Date and the date of exercise of Over-allotment Option.
The information about our Cornerstone Investors set forth below has been provided by the
Cornerstone Investors in connection with the Cornerstone Investment.
Xiangjiang Zhicheng
Hunan Xiangjiang Zhicheng Industrial Investment Fund Partnership (Limited Partnership)
(“Xiangjiang Zhicheng ”) is a limited partnership incorporated in China. Its general partner is
Hunan Guochuang Industry Investment Co., Ltd (“ Hunan Guochuang ”), which holds 0.0025%
equity interests therein and is a wholly owned subsidiary of Hunan Xiangjiang New Area State
Owned Capital Investment Co., Ltd., a company controlled by the State-owned Assets Supervision
and Administration Commission of Changsha Municipal People’s Government. Its other limited
partners include Hunan Xiangjiang New Area Guiding No.5 Equity Investment Partnership
Enterprise (Limited Partnership) (“ Xiangjiang New Area Guiding No. 5 ”), which holds 49.9975%
equity interests therein, and two other limited partners, each holding less than one-third of the
equity interests therein and are independent of each other. The general partner of Xiangjiang New
Area Guiding No. 5 is Hunan Guochuang, which holds 0.0083% equity interests of Xiangjiang
CORNERSTONE INVESTORS
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--- page 380 ---
New Area Guiding No. 5. The other limited partners of Xiangjiang New Agrea Guiding No. 5
include Xiangjiang New Area Guidance Fund Co., Ltd. (“ Xiangjiang New Area Guidance Fund ”)
and one other limited partner which holds less than one-third of the equity interests therein.
Xiangjiang New Area Guidance Fund holds 83.3250% of Xiangjiang New Agrea Guiding No. 5
and is ultimately controlled by Hunan Xiangjiang New District Management Committee.
Xiangjiang Zhicheng primarily engages in equity investment.
For the purpose of this cornerstone investment, Xiangjiang Zhicheng will subscribe for and
hold the relevant number of the Offer Shares under the Cornerstone Investment Agreements
through its wholly-owned subsidiary, Xiangjiang Autonomous Driving Industry Investment Co.,
Limited incorporated in Hong Kong. The principal business of Xiangjiang Autonomous Driving
Industry Investment Co., Limited is investment holding.
Zhijia No. 1
Nanning Zhijia No. 1 Ruiyue Equity Investment Partnership (Limited Partnership) (“ Zhijia
No. 1 ”) was established in April 2025 in Xingning District, Nanning City, Guangxi Zhuang
Autonomous Region, primarily focusing on equity investment, investment management, and asset
management activities.
Zhijia No.1 has two co-general partners, Shanghai Kangzhuang Equity Investment Fund
Management Co., Ltd. (“ Shanghai Kangzhuang ”) and Beibu Gulf Industrial Investment Fund
Management Co., Ltd., which hold 0.13% and 1.33% equity interests therein, respectively.
Shanghai Kangzhunag is controlled by Rao Jiasheng (ʺ), an Independent Third Party. Beibu
Gulf Industrial Investment Fund Management Co., Ltd. is wholly owned by Guangxi Beibu Gulf
Investment Group Co., Ltd. (“ Guanxi Beibu Gulf ”), a company controlled by State-owned Assets
Supervision and Administration Commission of The People’s Government of Guangxi Zhuang
Autonomous Region.
The limited partners of Zhijia No. 1 are (i) Nanning Guorui New Development Industry Fund
Partnership (Limited Partnership) (“ Nanning Guorui ”), holding 49.27% of the partnership
interests therein. The general partner of Nanning Guorui is Nanning Hechuang Private Equity Fund
Management Co., Ltd. (“ Nanning Hechuang ”). The only other limited partner is Nanning
Industrial Investment Group Co., Ltd (“ Nanning Industrial ”). Each of Nanning Hechuang and
Nanning Industrial is wholly owned by the State-owned Assets Supervision and Administration
Commission of Nanning Municipal People’s Government. Nanning Guorui focuses on equity
investment, investment management, and asset management activities through private equity funds;
(ii) Guangxi Guiyue Greater Bay Area Equity Investment Center (Limited Partnership) (“ Guangxi
Guiyue ”), which holds 47.60% of the partnership interest therein. The general partner and fund
manager of Guangxi Guiyue is Beibu Gulf Industrial Investment Fund Management Co., Ltd.
CORNERSTONE INVESTORS
– 370 –


--- page 381 ---
which is ultimately wholly owned by Guangxi Beibu Gulf. The other limited partners of Guangxi
Guiyue are Guangxi Beibu Gulf, which holds 39.96% equity interest of Guangxi Guiyue and
Guiyue (Shenzhen) Industrial Cooperation Development Co., Ltd., which holds 59.94% equity
interests of Guangxi Guiyue and is a subsidiary of Guangxi Beibu Gulf. The remaining 1.67%
equity interest of Zhijia No. 1 was held by one limited partner, holding less than one-third of the
equity interests therein. Guangxi Guiyue focuses on equity investment, investment management,
and asset management activities through private equity funds.
For the purpose of this cornerstone investment, Zhijia No. 1 will subscribe for and hold the
relevant number of the Offer Shares under the Cornerstone Investment Agreements through its
wholly-owned subsidiary, Hong Kong Ruiyue Intelligent Driving Enterprise Management Co.,
Limited incorporated in Hong Kong.
ICBCUBS
ICBC UBS Asset Management Company Limited (“ ICBCUBS ”) is a company incorporated
in Beijing and is primarily engaged in fund raising, fund sales, asset manager and other business
activities. ICBCUBS is wholly owned by Industrial and Commercial Bank of China Limited, a
company listed on the Stock Exchange (stock code: 01398.HK) and UBS Group AG, a company
listed on the SIX Swiss Exchange (stock code: UBSG.SW), as to 80% and 20%, respectively. For
the purpose of this cornerstone investment. ICBCUBS will subscribe for and hold the relevant
number of the Offer Shares under the Cornerstone Investment Agreements through QDIIs.
The investment funds of ICBCUBS in the Company are funded by ICBCUBS New Economy
Flexible Allocation Hybrid Securities Investment Fund (QDII) (“ ICBCUBS New Economy Fund ”)
and ICBCUBS Hong Kong Small & Medium-Cap Equity Fund (QDII) (“ ICBCUBS HK
Mid-Small Fund ”). According to the 2025 interim report of ICBCUBS New Economy Fund, it has
more than 4,510 holders. According to the 2025 interim report of ICBCUBS HK Mid-Small Fund,
it has 12,334 holders.
ICBCUBSI
ICBC UBS Asset Management (International) Company Limited (“ ICBCUBSI ”) is licensed
by the Securities and Futures Commission of Hong Kong to conduct Type 1 (Dealing in
Securities), Type 4 (Advising on Securities) and Type 9 (Asset Management) regulated activities.
ICBCUBSI is incorporated in Hong Kong and wholly owned by ICBCUBS. As confirmed by
ICBCUBSI, the ultimate beneficial owner of the discretionary account participating in this
cornerstone investment under the management of ICBCUBSI is an Independent Third Party.
CORNERSTONE INVESTORS
– 371 –


--- page 382 ---
QHKY Qunwei
Qianhai Kaiyuan Qunwei QDII Single Asset Management Plan (“ QHKY Qunwei ”) is a
specific asset management plan, the sole investor of which is Shanghai Chongshan Investment Co.,
Ltd., which is wholly owned by Jiangsu Lianfa Textile Co., Ltd., a company listed on the
Shenzhen Stock Exchange (stock code: 002394.SZ).
QHKY Qunwei’s investment into the Company would be completed through QDII programs
in the PRC, of which it has engaged Qianhai Kaiyuan Fund Management Co., Ltd. (“ QHKY
Fund”). QHKY Fund obtained approval by the CSRC on December 27, 2012, and was registered
in Qianhai, Shenzhen on January 23, 2013. QHKY Fund’s business scope includes: management of
publicly offered securities investment funds, fund sales, asset management for specific clients, and
other businesses permitted by the CSRC.
QHKY Fund is held as to 25%, 25%, 25% and 25% by Kaiyuan Securities Co., Ltd., Beijing
Zhongsheng Jinqi Investment Management Co., Ltd., Beijing Changhe Century Asset Management
Co., Ltd. and Shenzhen Hehe Investment Trust Partnership (Limited Partnership) (“ Shenzen
Hehe”), respectively. Kaiyuan Securities Co., Ltd. is a subsidiary of Shaanxi Coal and Chemical
Industry Group Co., Ltd., which is wholly owned by State-owned Assets Supervision and
Administration Commission of Shaanxi Provincial People’s Government. Beijing Changhe Century
Asset Management Co., Ltd. is a subsidiary of Beijing Huili Daren Information Consulting Co.,
Ltd., a company controlled by Li Peixin, an Independent Third Party. Beijing Zhongsheng Jinqi
Investment Management Co., Ltd. is controlled by Wang Haishan, an Independent Third Party.
Shenzhen Hehe is a limited partnership established in the PRC. The equity interests of Shenzhen
Hehe are owned by 5 general partners and 39 limited partners, each holding less than one-third of
the equity interests therein.
CLOSING CONDITIONS
The subscription obligation of each of the Cornerstone Investors under the respective
Cornerstone Investment Agreements is subject to, among other things, the following closing
conditions:
(a) the underwriting agreements for the Hong Kong Public Offering and the International
Offering being entered into and having become effective and unconditional (in
accordance with their respective original terms or as subsequently waived or varied by
agreement of the parties thereto) by no later than the time and date as specified in these
underwriting agreements, and neither of the aforesaid underwriting agreements having
been terminated;
CORNERSTONE INVESTORS
– 372 –


--- page 383 ---
(b) the Offer Price having been agreed upon between the Company and the Overall
Coordinators (for themselves and on behalf of the underwriters of the Global Offering);
(c) the Listing Committee of the Stock Exchange having granted the approval for the listing
of, and permission to deal in, the H Shares (including the H Shares subscribed for by
each of the Cornerstone Investors) as well as other applicable waivers and approvals
(including waivers and approvals related to the subscription of the H Shares by each of
the Cornerstone Investors), and such approval, permission or waiver having not been
revoked prior to the commencement of dealings in the H Shares on the Stock Exchange;
(d) no laws shall have been enacted or promulgated by any governmental authority which
prohibits the consummation of the transactions contemplated in the Global Offering or
in the Cornerstone Investment Agreements and there shall be no orders or injunctions
from a court of competent jurisdiction in effect precluding or prohibiting consummation
of such transactions; and
(e) the respective representations, warranties, undertakings, acknowledgements and
confirmations of the Cornerstone Investor under the Cornerstone Investment Agreement
are (as of the date of the respective Cornerstone Investment Agreement) and will be (as
of the Closing (as defined in the respective Cornerstone Investment Agreement) and the
delayed delivery date (as applicable)) true, accurate and complete in all respects and not
misleading and that there is no breach of such Cornerstone Investment Agreement on the
part of the Cornerstone Investor.
RESTRICTIONS ON DISPOSALS BY THE CORNERSTONE INVESTORS
Each of the Cornerstone Investors has agreed that it will not, whether directly or indirectly, at
any time during the period of six months from and including the Listing Date (the “ Lock-up
Period ”), dispose of any of the Offer Shares they have subscribed for pursuant to the relevant
Cornerstone Investment Agreement, save for in certain limited circumstances, such as transfers to
any of its wholly-owned subsidiaries who will be bound by the same obligations of such
Cornerstone Investor, including the Lock-up Period restriction.
CORNERSTONE INVESTORS
– 373 –


--- page 384 ---
You should read the following discussion and analysis in conjunction with our
consolidated financial statements, included in the Accountant’ s Report in Appendix I, together
with the respective accompanying notes. Our consolidated financial information has been
prepared in accordance with the International Financial Reporting Standards (“ IFRSs ”).
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 , whether actual outcomes and developments
will meet our expectations and predictions depends on a number of risks and uncertainties,
many of which we cannot control or foresee. In evaluating our business, you should carefully
consider all of the information provided in this prospectus, including the sections headed “Risk
Factors” and “Business,” and elsewhere in this Prospectus. For further details, see
“Forward-Looking Statements.”
OVERVIEW
We are an innovative product-driven provider of intelligent driving products and solutions for
commercial vehicles in China. We focus on the research and development of closed-environment
autonomous driving trucks for mining and logistics, V2X (vehicle-to-everything) technologies and
intelligent perception solutions, and offer products and solutions underpinned by proprietary
technologies, with a primary focus on intelligent driving in closed environments during the Track
Record Period. According to CIC:
 We ranked sixth among all commercial vehicle intelligent driving companies in China
(including Hong Kong, Macau and Taiwan), with a market share of approximately 5.2%.
 We delivered 56 autonomous mining trucks for a mining site in China (including Hong
Kong, Macau and Taiwan) in mixed traffic with ~500 manned trucks, the world’s largest
mixed-operation mining fleet
(1) as of the Latest Practicable Date.
 We delivered the first fully driverless electric mining fleet in China (including Hong
Kong, Macau and Taiwan).
 We ranked third in China (including Hong Kong, Macau and Taiwan)’s autonomous
mining truck solution market in terms of revenue in 2024.
 We are among the first intelligent driving companies in China (including Hong Kong,
Macau and Taiwan) to launch commercial V2X products.
Note:
(1) “Autonomous mining trucks” refers to autonomous driving trucks designed for mining operations. “Mixed-operation”
refers to scenarios involving both manned and unmanned mining trucks.
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 Our train autonomous perception system (TAPS) is the only product in China (including
Hong Kong, Macau and Taiwan) capable of independent safety perception (1) for trains.
Drawing upon innovative methodology technology capabilities, we developed products and
solutions encompassing (i) autonomous driving technologies, delivering closed-environment
autonomous mining trucks and offering closed-environment autonomous logistics truck solutions,
(ii) V2X products and solutions for intelligent transportation and smart cities, and (iii) intelligent
perception solutions for rail transit and commercial vehicles.
Our business strategy and innovative technological prowess made us a market innovator in
mass commercialization. Our initial focus on core intelligent driving functions for commercial
vehicles fortified our competitive edge. Subsequently, we expanded and tailored our offerings to
cater to more diverse and sophisticated demands, delivering unique value to customers across
sectors and forming close collaborations with strategic partners, such as leading automotive OEMs,
machinery manufacturers and energy companies. Our loyal customer base further solidifies our
technological leadership and brand influence. We served 44, 85, 131 and 152 customers as of
December 31, 2022, 2023, 2024 and June 30, 2025, respectively. As of June 30, 2025, our total
order backlog value reached approximately RMB583.9 million. As of the same date, we delivered
304 autonomous mining trucks and 110 sets of standalone autonomous truck systems to customers,
and received indicative orders for 357 autonomous mining trucks and 290 sets of standalone
autonomous truck systems.
Our revenue increased from RMB31.1 million in 2022 to RMB410.0 million in 2024 with a
CAGR of 263.1%. Our revenue increased by 57.9% from RMB258.5 million in the six months
ended June 30, 2024 to RMB408.0 million in the six months ended June 30, 2025. Our gross profit
increased from RMB26.8 million in 2023 to RMB101.4 million in 2024. Our gross profit increased
by 57.1% from RMB44.4 million in the six months ended June 30, 2024 to RMB69.7 million in
the six months ended June 30, 2025.
BASIS OF PREPARATION
Our historical financial information has been prepared based on IFRSs Accounting Standards,
issued by the International Accounting Standards Board. The historical financial information has
been prepared under the historical cost convention, as modified by the revaluation of certain
financial assets at FVTPL and financial assets at FVTOCI, which are carried at fair value. The
historical financial information has been prepared on a going concern basis. The preparation of the
Note:
(1) Without relying on existing railway signaling systems or additional track-side devices.
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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 4 to the Accountant’s Report included in Appendix I to this
prospectus.
Certain new accounting standards, amendments to accounting standards and interpretations
have been published that are not effective for the Track Record Period and have not been early
adopted by us. These standards, amendments or interpretations are not expected to have a material
impact on us in the current or future reporting periods and on foreseeable future transactions
except the new IFRS 18 as set out below.
We have already commenced an assessment of the impact of these new or revised standards
and amendments. IFRS 18 sets out requirements on presentation and disclosures in financial
statements and it will replace IAS 1 Presentation of Financial Statements. The new standard
introduces new requirements to present specified categories and defined subtotals in the statement
of profit or loss; provide disclosures on management-defined performance measures in the notes to
the financial statements and improve aggregation and disaggregation of information to be disclosed
in the financial statements. Minor amendments to IAS 7 Statement of Cash Flows and IAS 33
Earnings per Share are also made. IFRS 18 will be effective for annual periods beginning on or
after 1 January 2027, with early application permitted. We do not plan to early adopt IFRS 18.
IFRS 18, after its adoption on 1 January 2027, will impact the presentation of financial statements
(including aggregation and disaggregation of items within statement of financial position and
statement of profit or loss and other comprehensive income), but in terms of recognition and
measurement, IFRS 18 is not expected to have significant impact on the financial performance and
positions of us. Except for this, no material impact on the financial performance and positions of
us is expected when they become effective. See Note 2.1 to the Accountant’s Report included in
Appendix I to this prospectus.
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KEY FACTORS AFFECTING OUR PERFORMANCE
Our results of operations and financial condition have been, and will continue to be,
materially affected by a number of factors, some of which are outside our control, including:
Our Ability to Expand and Successfully Commercialize and Optimize Our Product and
Solution Portfolio
Our revenue grew significantly during the Track Record Period, primarily due to the
expansion of our product and solution offerings. We launched our METAMINE solution,
closed-environment autonomous logistics truck solution, V2X products and solutions, autonomous
perception systems for rail transit, and intelligent perception solutions for commercial vehicles, all
of which generated revenue and entered mass production during the Track Record Period. As we
expand the sales of our various products and solutions and enhance our brand recognition, we are
able to develop and offer products and solutions with stronger capabilities, more functions and
further customization for various types of commercial vehicles. Going forward, we anticipate
improving economies of scale as we expand operations, reducing costs and increasing adoption of
our products.
We determine the pricing of our products and solutions based on market levels, project
complexity, service scope and costs. Our success will depend on our ability to expand our product
and solution offerings in a cost-efficient manner and improve the quality and efficiency of our
existing products and solutions. Furthermore, within each category of our product and solution
portfolio, we provide various options to meet diverse customer needs. See “Business — Overview
— Our Offerings.” Typically, these products or solutions differ in pricing, raw materials and cost
structure, resulting in varying gross margins. Each offering is uniquely positioned with distinct
marketing strategies. Consequently, our revenue and profitability are significantly influenced by
our product and solution portfolio.
We believe that our increasingly diverse portfolio allows us to swiftly adapt to changing
market conditions and customer preferences. We have been optimizing our portfolio to enhance our
revenue and profitability.
Our Ability to Attract New Customers and Deepen Relationships with Existing Customers
We provide a series of solutions encompassing (i) autonomous driving technologies,
delivering autonomous mining trucks and offering logistics truck solutions for use in closed
environments, (ii) V2X products and solutions for intelligent transportation and smart cities, and
(iii) intelligent perception solutions for rail transit and commercial vehicles in open environments.
Our management and sales team have extensive industry experience and profound knowledge,
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allowing us to build our brand and acquire customers in an effective manner. We successfully
rolled out a series of benchmark projects across China, earning the trust of strategic partners. For
autonomous mining, we delivered the first fully driverless electric mining fleet in China for TCC
in Jurong, Jiangsu, which is also the first nationwide autonomous mining project certified by the
NIM to exceed the efficiency of manual mining operations; our project in Northwest China
represents China (including Hong Kong, Macau and Taiwan)’s largest mixed fleet of manned and
unmanned mining vehicles; our autonomous mining project in Zhengzhou, Henan represents China
(including Hong Kong, Macau and Taiwan)’s first fully driverless quarry with excavator
collaboration, according to CIC. For V2X, since the initial commercialization of our in-house
developed V2X devices in 2018, we consistently achieved groundbreaking endeavors including
launching the innovative V2X + Active Transit Signal Priority system and playing a key role in
establishing one of the largest national-level V2X pilot zones for Liangjiang New Area,
Chongqing, according to CIC. For intelligent perception, our solutions have been selected for mass
production by leading commercial vehicle OEMs such as Sinotruk and FAW Jiefang.
We endeavor to maintain stable and long-term business relationships with our customers by
delivering comprehensive, customer-centric services. Our representative customers include
prominent companies across various sectors, such as Sinotruk from the automotive industry; TCC
from the construction industry; and NavInfo from the V2X industry. We had continuously
expanded our customer base during the Track Record Period, with the number of customers
growing from 44 as of 2022 to 152 as of June 30, 2025.
We enter into long-term strategic partnership with our customers, which allows us to work
closely with them at early stages of projects, and to timely iterate our products and solutions to
fulfill the evolving needs of end consumers in line with the market trends. We plan to gain access
to global markets and R&D resources through such partnership and cooperation, further expanding
our presence in the commercial vehicle industry.
Investment in Technology Leadership and Product Development
Our ability to develop new technologies, design new products and solutions and enhance
existing products and solutions is critical to our business operations. Our financial performance is
dependent on our ability to maintain our position in the commercial vehicle industry, which in turn
depends on the investments we make in research and development. It is essential that we
continually identify and respond to rapidly evolving customer requirements, develop and introduce
innovative products and solutions, enhance existing offerings and features, and generate active
market demand for our commercial vehicle products and solutions. In particular, we are committed
to investing in our technologies, diversifying our product portfolio by pioneering different
commercial vehicle products and solutions, and commercializing new offerings based on market
trends. We offer comprehensive capabilities covering intelligent driving products and solutions,
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empowering us to integrate different components to launch our diversified and customer-centric
products and offerings. Our offerings covering autonomous driving, V2X and intelligent perception
solutions connect us with customers in the entire value chain of the commercial vehicle industry,
providing further opportunities for cross-domain technology advancement and business
development.
In order to maintain our current position in technological innovation, we established a highly
experienced talent pool with strong expertise and capabilities in relevant fields. Highly skilled and
talented research and development personnel enable us to remain at the forefront of the
commercial vehicle industry, and are therefore critical to our success. We have made significant
investments in our R&D activities during the Track Record Period, as we believe that our R&D
capabilities will be the main driving force for our long-term competitiveness and business
prospects. Our total research and development expenses during the Track Record Period amounted
to RMB545.4 million. As of June 30, 2025, our research and development team consisted of 249
members, representing 54.1% of total employees as of the same date. As there is a limited supply
of research and development personnel with necessary experience and expertise, and such talent is
highly sought after, we will continue to provide competitive compensation and benefits packages
to attract talent. We also cultivate our in-house staff by providing them with appealing professional
development opportunities.
Our Ability to Effectively Control Costs and Expenses and Improve Efficiency
Our future profitability depends significantly on our ability to control costs and operating
expenses, which are affected by a number of factors, such as costs of components, raw materials
and other supplies, as well as our operational efficiency. We believe that as we ramp up the sales
of our products and solutions, we will achieve economies of scale such that our costs and
operating expenses as a percentage of our total revenue will decrease. Additionally, we will also
explore different ways to enhance our manufacturing capabilities by partnering with contract
manufacturers in order to meet mass production needs while controlling capital expenditure. Our
operating expenses decreased as a percentage of revenue from 652.4% in 2022 to 136.2% in 2024
and further decreased to 96.9% in the six months ended June 30, 2025, indicating improved
operational efficiency.
We are constantly improving our operating efficiency in various areas. For instance, we have
streamlined the project management process to enhance our R&D efficiency and reduce the
time-to-market of products. Our sales team are well prepared to capture business opportunities
based on customer demands, and are able to offer precise suggestions for product design and
delivery, minimizing subsequent changes and rework in the production process. We have also
improved our administrative management to reduce communication costs and improve
collaboration efficiency.
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Working Capital Management
Cash flow management is another major factor that affects our results of operations. Cash
flow is crucial to sustaining operations, funding research and development, and investing in new
technology. The timing of cash inflows from our customers relative to our cash outflows for
operating expenses, capital expenditures, and supplier payments is crucial for maintaining liquidity
and financial stability.
Our operating cash flow is influenced by our profitability, changes in working capital, and
the timing of cash receipts and payments. Efficient management of receivables, payables, and
inventory levels directly impacts our cash conversion cycle and our ability to generate positive
cash flow from operations. In periods of growth, we may require significant investment in capital
expenditures to keep pace with technological advancements. These investments can strain our cash
resources, and we may need to seek external financing to support our capital needs. The terms and
availability of such financing, as well as our ability to generate cash from operations, are key
determinants of our ability to invest in growth opportunities and manage our capital structure
effectively. Our net cash used in operating activities decreased from RMB203.1 million in 2022 to
RMB147.7 million in 2024. Our net cash used in operating activities increased from RMB42.5
million in the six months ended June 30, 2024 to RMB208.2 million in the six months ended June
30, 2025, primarily due to a significant increase in trade receivables.
General Factors
Our business and operating results are also affected by general factors affecting the
commercial vehicle industry, which include: (i) market demand for autonomous commercial
vehicles; (ii) the evolution and market acceptance of intelligent driving technologies; (iii) the
competitive landscape; and (iv) relevant laws and regulations, and governmental policies and
initiatives.
IMPACT OF COVID-19
Since the end of December 2019, the COVID-19 pandemic has materially and adversely
affected the global economy. In response, countries and regions worldwide, including mainland
China, imposed various measures to contain the virus’s spread, such as social distancing, travel
restrictions, quarantine, and remote work, among others.
The pandemic’s recurrence temporarily disrupted our business, operational results and
financial condition. In 2022, the mobility of some employees was affected, and certain employees
had to work remotely. Additionally, pandemic-related restrictions slowed the implementation
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schedule of some projects, the acceptance of which was also delayed. We undertook several
measures to mitigate the impact on our operations and performance, including temporarily closing
our offices and providing remote work arrangements and support for R&D activities.
As the COVID-19 pandemic has subsided since early 2023, our business operations have
resumed normalcy. Save for the above, our Directors are of the view that COVID-19 did not have
any material adverse impact on our business during the Track Record Period and up to the Latest
Practicable Date.
MATERIAL ACCOUNTING POLICY INFORMATION
Some of our accounting policies require us to apply estimates and assumptions as well as
complex judgments relating to accounting items. The estimates and assumptions we use and the
judgments we make in applying our accounting policies have a significant impact on our financial
position and results of operations. Our management continually evaluates such estimates,
assumptions and judgments based on historical experiences and other factors, including
expectations of future events that are believed to be reasonable under the circumstances. There has
not been any material deviation between our management’s estimates or assumptions and actual
results, and we have not made any material changes to these estimates or assumptions during the
Track Record Period. We do not expect any material changes in these estimates and assumptions in
the foreseeable future.
Set forth below are discussions of the accounting policies that we believe are of critical
importance to us or involve the most significant estimates, assumptions and judgments used in the
preparation of our financial statements. Other material accounting policy information, estimates,
assumptions and judgments, which are important for understanding our financial condition and
results of operations, are set forth in detail in Note 2 to the Accountant’s Report included in
Appendix I to this prospectus.
Revenue Recognition
We recognize revenue when (or as) a performance obligation is satisfied, i.e., when control of
the goods underlying the particular performance obligation is transferred to the customer.
Control is transferred over time and revenue is recognized over time by reference to the
progress towards complete satisfaction of the relevant performance obligation if one of the
following criteria is met:
 we provide all of the benefits received and consumed simultaneously by the customer;
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 we create and enhance an asset that the customer controls as we perform; or
 we do not create an asset with an alternative use to our Group and our Group has an
enforceable right to payment for performance completed to date.
Otherwise, revenue is recognized at a point in time when the customer obtains control of the
distinct goods or services.
In determining whether revenue of our Group should be reported gross or net is based on a
continuing assessment of various factors. When determining whether our Group is acting as the
principal or agent in offering goods or services to the customer, we need to first identify who
controls the specified goods or services before they are transferred to the customer. We follow the
accounting guidance for principal-agent considerations to assess whether we control the specified
goods or service before it is transferred to the customer, the indicators of which including but not
limited to (a) whether the entity is primarily responsible for fulfilling the promise to provide the
specified service; (b) whether the entity has inventory risk before the specified service has been
transferred to a customer; and (c) whether the entity has discretion in establishing the prices for
the specified goods or service. Our management considers the above factors in totality, as none of
the factors individually are considered presumptive or determinative, and applies judgment when
assessing the indicators depending on each different circumstances.
At the inception of the contract, we assess the goods promised that have been promised to the
customer and identifies as a performance obligation when (a) a good or service (or a bundle of
goods or services) that is distinct; or (b) a series of distinct goods or services that are substantially
the same and that have the same pattern of transfer to the customer.
Autonomous Driving Solutions
Revenue generated from sales of autonomous driving solutions which combines the
unmanned electric mining trucks and logistics trucks with remote control cockpit and solutions
with proprietary algorithms and software, which is recognized at the point in time when the
performance obligation under the terms of a contract with the customer is satisfied and control of
the product has been transferred to the customer, generally upon the acceptance of the solutions.
We control the specified goods and services before they are transferred to a customer and
have discretion in establishing prices. We are the principal and recognize revenue from sales of
autonomous driving solutions on a gross basis.
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We generally offer assurance-type warranties to customers and such warranties are not
considered a distinct performance obligation to customers. We account for the warranty in
accordance with IAS 37.
After the sales contracts have been signed, partial consideration will be collected by us. We
began to stock up after collecting the prepayments. Before the solutions are delivered to the
customers, partial consideration will be collected by us. The remaining consideration except for
the amount of quality warranty will be collected during the credit period of customers. The amount
of quality warranty will be collected after the end of the warranty period. We usually offer a
warranty period of six months to one year.
Autonomous Driving Products
Revenue generated from sales of autonomous driving products which could be installed in the
electric trucks, which is recognised at the point in time when the performance obligation under the
terms of a contract with the customer is satisfied and control of the products has been transferred
to the customer, generally upon the acceptance of the products.
We control the specified goods before they are transferred to a customer and has discretion in
establishing prices. We are the principal and the revenue generated from sales of intelligent driving
products is reported on a gross basis.
We generally have the right to collect certain of the contract price of the products from the
customers upon their acceptance of the products. The remaining payments are settled after the end
of the standard warranty period. We usually offer a warranty period for one year.
V2X Products and Solutions
We provide V2X products and solutions to our customers. Revenue is recognized when
control over the products and solutions have been transferred to the customer. The customers
cannot receive and consume the benefits simultaneously from us as well as control the products
and solutions until the products and solutions are delivered to the customer. The products and
solutions generally have no alternative use for us due to contractual restrictions. However, an
enforceable right to payment does not arise until the products and solutions are accepted by the
customer. Therefore, revenue is recognized at a point in time when the products and solutions are
accepted by the customer.
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The determination of whether revenue should be reported on a gross or net basis is based on
an assessment of whether we are acting as the principal or an agent in the transactions. We provide
significant service related to the V2X products and solutions and are responsible for the overall
management of the contract. We are the principal in the transaction and recognize revenue in the
gross amount of consideration to which it is entitled from the customer.
After the sales contracts have been signed, partial consideration will be collected by us. Then,
after the products and solutions are delivered to the designated location of customers and are
initially accepted by the customers, partial consideration will be collected by us. The remaining
consideration except for the amount of quality warranty will be collected after the final acceptance
of customers. The amount of quality warranty will be collected after the end of the warranty
period. We usually offer a warranty period from one year to three years.
Commission Income
We act in the capacity of an agent rather than as the principal in the transaction of ancillary
services relating to procurement of the peripheral related to V2X. We recognize revenue from these
services on a net basis.
Intelligent Perception
Revenue generated from sales of intelligent perception solutions is recognized at the point in
time when the performance obligation under the terms of a contract with the customer is satisfied
and control of the solutions has been transferred to the customer, generally upon the acceptance of
the products and solutions.
We control the specified goods and services before they are transferred to a customer and
have discretion in establishing prices. We are the principal and recognize revenue from sales of
intelligent perception solutions on a gross basis.
The consideration will be collected once through bank acceptance notes after the settlements
with customers monthly. We usually offer a warranty period from one year to three years.
Contract Assets and Liabilities
When either party to a contract has performed, we present the contract in the consolidated
statement of financial position as a contract asset or a contract liability, depending on the
relationship between our performance and the customer’s payment. A contract asset is our right to
consideration in exchange for services that we have transferred to a customer.
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If a customer pays consideration or we have a right to an amount of consideration that is
unconditional, before we transfer goods to the customer, we have a contract liability when the
payment is received or a receivable is recorded (whichever is earlier). A contract liability is our
obligation to transfer goods to a customer for which we have received consideration from the
customer. A receivable is recorded when we have an unconditional right to consideration. A right
to consideration is unconditional if only the passage of time is required before payment of that
consideration is due.
Financial Instruments with Preferred Rights at Amortized Cost
A contract that contains an obligation for us to purchase our equity instruments for cash or
another financial asset gives rise to a financial liability for the present value of the redemption
amount. Even if our obligations to purchase are conditional on the counterparty exercising a right
to redeem, the financial instruments with preferred rights are recognized as financial liability
initially measured at fair value (representing the present value of the redemption amount) and
subsequently measured at amortized cost with interest charged in finance costs.
We derecognize financial liabilities when, and only when, our obligations are discharged,
canceled after the settlement by us has been made. The carrying amount of the financial
instruments are reclassified to equity when and only when, our obligation (i.e. the redemption
obligation) have expired, with the corresponding credit to the treasury stocks.
Share-based Payment
The fair value of awarded shares granted to employees under the ESOP less amount paid by
employees is recognized as an employee benefits expense over the relevant service period, being
the vesting period of the shares, and the credit is recognized in equity in the share-based payment
reserves. The fair value of the shares is measured at the grant date. The total amount to be
expensed is determined by reference to the fair value of the equity instruments granted:
 including any market performance conditions;
 excluding the impact of any service and non-market performance vesting conditions; and
 including the impact of any non-vesting conditions.
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The total expense is recognized over the vesting period, which is the period over which all of
the specified vesting conditions are to be satisfied. At the end of each reporting period, we revise
our estimates of the number of shares that are expected to vest based on the service conditions. we
recognize the impact of the revision to original estimates, if any, in profit or loss, with a
corresponding adjustment to equity.
Where there is any modification of terms and conditions which increases the fair value of the
equity instruments granted, we include the incremental fair value granted in the measurement of
the amount recognized for the services received over the remainder of the vesting period. The
incremental fair value is the difference between the fair value of the modified equity instrument
and that of the original equity instrument, both estimated as at the date of the modification. An
expense based on the incremental fair value is recognized over the period from the modification
date to the date when the modified equity instruments vest in addition to any amount in respect of
the original instrument, which should continue to be recognized over the remainder of the original
vesting period. Where shares are forfeited due to a failure by the employee to satisfy the service
conditions, any expenses previously recognized in relation to such shares are reversed effective at
the date of the forfeiture.
The grant of share-based payments by the shareholders to the employees of the subsidiaries
are treated as a capital contribution to subsidiaries in the separate financial statements of our
Company. The fair value of employee services received, determined by reference to the grant date
fair value, is recognized over the vesting period as an increase to investments in subsidiaries
undertakings, with a corresponding adjustment to equity in the separate financial statements of our
Company.
Property, Plant and Equipment
Property, plant and equipment are stated at historical cost less depreciation and accumulated
impairment.
Historical cost includes expenditure that is directly attributable to the acquisition of the
items.
Subsequent costs are included in the asset’s carrying amount or recognized as a separate
asset, as appropriate, only when it is probable that future economic benefits associated with the
item will flow to our Group and the cost of the item can be measured reliably. The carrying
amount of any component accounted for as a separate asset is derecognized when replaced. All
other repairs and maintenance are charged to profit or loss during the year in which they are
incurred.
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Other than construction in progress, depreciation is calculated using the straight-line method
to allocate their cost, net of their residual values, over their estimated useful lives as follows:
Buildings 10 − 20 years
Vehicles 4 years
Machinery and equipment 5 years
Office equipment, computers and
others
5 years
Tested field and related equipment 5 years
Leasehold improvements shorter of the term of the lease or the estimated useful
lives of the assets
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the
end of each reporting period.
An asset’s carrying amount is written down immediately to its recoverable amount if the
asset’s carrying amount is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing the proceeds with the carrying
amount and are recognized within “Other (losses)/gains, net” in the consolidated statements of
profit or loss and other comprehensive income.
Construction in progress represents unfinished construction and equipment under construction
or pending for installation and is stated at cost less impairment losses. Cost comprises direct costs
of construction including borrowing costs attributable to the construction during the period of
construction. No provision for depreciation is made on construction in progress until such time as
the relevant assets are completed and ready for intended use.
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The management has assessed that there is impairment indication for our non-financial assets
at the end of each reporting period during the Track Record Period resulting from our unfavorable
operating performance during the Track Record Period. Therefore, the management has performed
impairment assessment for the non-financial assets, which mainly consist of our property, plant
and equipment, right-of-use assets, intangible assets and prepayments for acquisition of property,
plant and equipment. Based on the result of the assessment, the recoverable amounts of
non-financial assets exceed the carrying amounts of non-financial assets at the end of each
reporting period. No impairment loss has been provided for our non-financial assets for the Track
Record Period. See Note 16 to the Accountant’s Report included in Appendix I to this prospectus.
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
The following table sets forth a summary of our consolidated statements of profit or loss for
the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount
%o f
revenue Amount
%o f
revenue Amount
%o f
revenue Amount
%o f
revenue Amount
%o f
revenue
(RMB in thousands, except for percentage)
(unaudited)
Revenue .............. 31,056 100.0 132,604 100.0 410,035 100.0 258,461 100.0 408,036 100.0
Cost of sales ........... (37,051) (119.3) (105,781) (79.8) (308,595) (75.3) (214,082) (82.8) (338,328) (82.9)
Gross profit/(loss) ........ (5,995) (19.3) 26,823 20.2 101,440 24.7 44,379 17.2 69,708 17.1
Other income ........... 7,406 23.8 11,199 8.4 7,455 1.8 5,798 2.2 861 0.2
Other gains/(losses), net ..... 115 0.4 801 0.6 (19) (0.0) (102) (0.0) 401 0.1
Impairment losses ........ (5,092) (16.4) 3,589 2.7 (29,038) (7.1) (5,280) (2.0) (84,280) (20.7)
Selling expenses ......... (23,148) (74.5) (31,404) (23.7) (64,439) (15.7) (23,611) (9.1) (44,288) (10.9)
General and administrative
expenses ............ (68,969) (222.1) (97,827) (73.8) (300,721) (73.3) (56,070) (21.7) (199,678) (48.9)
Research and development
expenses ............ (110,507) (355.8) (90,396) (68.2) (193,181) (47.1) (35,339) (13.7) (151,317) (37.1)
Finance costs, net ......... (96,684) (311.3) (112,921) (85.2) (130,653) (31.9) (63,246) (24.5) (71,252) (17.5)
Loss before income tax ..... (302,874) (975.3) (290,136) (218.8) (609,156) (148.6) (133,471) (51.6) (479,845) (117.6)
Income tax credit ......... 39,877 128.4 35,057 26.4 28,312 6.9 10,904 4.2 24,759 6.1
Loss for the year/period ..... (262,997) (846.8) (255,079) (192.4) (580,844) (141.7) (122,567) (47.4) (455,086) (111.5)
FINANCIAL INFORMATION
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--- page 399 ---
NON-IFRS FINANCIAL MEASURE
To supplement our consolidated financial statements, which are presented in accordance with
IFRS, we also use adjusted net loss (Non-IFRS Measure) as an additional financial measure, which
is not required by, or presented in accordance with IFRS. We believe this non-IFRS measure
facilitates comparisons of operating performance from year to year and 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 combined results of operations in the
same manner as they help our management. However, such non-IFRS financial measure that 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 substitute for analysis of our results of
operations or financial condition as reported under IFRS.
We define adjusted net loss (Non-IFRS Measure) for the year/period as net loss for the
year/period adjusted by adding back (i) share-based payments, (ii) financial cost on financial
instruments with preferred rights at amortized cost, and (iii) listing expenses. The following table
reconciles our adjusted net loss (Non-IFRS Measure) for the year presented in accordance with
IFRS, which is net loss for the periods:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Net loss for the year/period ......... (262,997) (255,079) (580,844) (122,567) (455,086)
Add:
— Share-based payments (1) ........ — — 313,500 — 266,822
— Financial cost on financial
instruments with preferred rights
at amortized cost
(2) .......... 104,136 117,528 128,593 63,119 67,923
— Listing expenses (3) ............ — — 11,896 — 9,379
Adjusted net loss (Non-IFRS Measure)
for the year/period ............. (158,861) (137,551) (126,855) (59,448) (110,962)
Notes:
(1) Share-based payments relate to the non-cash employee benefit expenses incurred in connection with our award to
management and key employees.
FINANCIAL INFORMATION
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--- page 400 ---
(2) Financial cost on financial instruments with preferred rights at amortized cost was in relation to financial
instruments with preferred rights in connection with our issuance of ordinary shares to pre-IPO investors that
conferred the redemption rights. The financial instruments with preferred rights are recognized as financial liability
initially measured at fair value (representing the present value of the redemption amount) and subsequently
measured at amortized cost with interest charged in finance costs. The financial cost on financial instruments with
preferred rights at amortized cost is considered a non-cash item. The financial instruments with preferred rights at
amortized cost will be re-designated from liabilities to equity as a result of the automatic conversion into ordinary
shares upon Listing.
(3) Listing expenses represent professional fees, underwriting commissions and other fees incurred in connection with
the Global Offering.
We had a net loss of RMB263.0 million, RMB255.1 million, RMB580.8 million, RMB122.6
million and RMB455.1 million in 2022, 2023, 2024 and the six months ended June 30, 2024 and
2025, respectively, primarily due to (i) our continuous investment in research and development, (ii)
continuous increase in net finance costs mainly resulting from financial cost on financial
instruments with preferred rights at amortized cost in relation to our Pre-IPO investments, and (iii)
share-based payments incurred in relation to our Share Incentive Scheme adopted and approved on
September 23, 2024, which amounted to RMB313.5 million in 2024 and RMB266.8 million for the
six months ended June 30, 2025. Apart from the three reasons mentioned above, the increase in
our net loss from RMB122.6 million in the six months ended June 30, 2024 to RMB455.1 million
in the same period of 2025 is also attributable to higher impairment losses, primarily from (i)
impairment losses of RMB56.9 million
(1) related to financial guarantee contract liabilities and
other receivables arising from Customer K’s default under its finance lease agreement, and (ii)
impairment losses of RMB26.2 million related to trade and notes receivables, mainly due to (a)
revenue growth, which led to an increase in trade and notes receivable balances, and (b) the aging
of trade receivables from Customer L, which resulted in an impairment loss of RMB5.8 million.
Correspondingly, our adjusted net loss (Non-IFRS Measure) increased from RMB59.4 million in
the six months ended June 30, 2024 to RMB111.0 million in the same period of 2025. See
“Business — Customers — Major Customers — Transactions with Customer K” and “—
Discussion of Key Items of Consolidated Statements of Financial Position — Net Current
Assets/(Liabilities) — Trade and Notes Receivables, Current Portion.”
Note:
(1) The impairment losses of RMB56.9 million arising from Customer K are higher than our total impairment amount
recognized for financial guarantee contract liabilities and other receivables in the six months ended June 30, 2025,
primarily because certain impairment losses were partially reversed.
FINANCIAL INFORMATION
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--- page 401 ---
DESCRIPTION OF MAJOR COMPONENTS OF OUR RESULTS OF OPERATIONS
Revenue
During the Track Record Period, we derived revenue from the (i) autonomous driving, (ii)
V2X, and (iii) intelligent perception solutions. Our revenue increased from RMB31.1 million in
2022 to RMB410.0 million in 2024 with a CAGR of 263.1%. Our revenue increased from
RMB258.5 million in the six months ended June 30, 2024 to RMB408.0 million in the six months
ended June 30, 2025. We served 44, 85, 131 and 152 customers as of December 31, 2022, 2023,
2024 and June 30, 2025, respectively. The table below sets forth our revenue breakdown by
products and solutions in absolute amounts and as percentages of our total revenue for the periods
indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Autonomous driving ........ 27,998 90.2 74,418 56.1 254,887 62.1 156,043 60.4 378,364 92.7
Closed-environment
autonomous mining products
and solutions ......... 27,187 87.6 64,132 48.3 246,635 60.1 152,456 59.0 375,820 92.1
Closed-environment
autonomous logistics truck
solution ........... 811 2.6 10,286 7.8 8,252 2.0 3,587 1.4 2,544 0.6
V2X ................ 3,058 9.8 36,812 27.8 101,591 24.8 74,237 28.7 9,179 2.3
Intelligent perception ....... — — 21,374 16.1 53,557 13.1 28,181 10.9 20,493 5.0
Total ................ 31,056 100.0 132,604 100.0 410,035 100.0 258,461 100.0 408,036 100.0
Autonomous Driving
During the Track Record Period, revenue generated from sales of autonomous driving
amounted to RMB28.0 million, RMB74.4 million, RMB254.9 million, RMB156.0 million and
RMB378.4 million, respectively, accounting for 90.2%, 56.1%, 62.1%, 60.4% and 92.7% of our
total revenue for the same period, respectively. Our autonomous driving can be classified into two
categories, namely closed-environment autonomous mining products and solutions and
closed-environment autonomous logistics truck solutions. The continuous growth of revenue
FINANCIAL INFORMATION
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--- page 402 ---
generated from sales of autonomous driving from 2022 to 2024 was mainly attributable to our
increased sales volume and customer base in autonomous mining products and solutions. See “—
Period-to-Period Comparison of Results of Operations.”
V2X
During the Track Record Period, revenue generated from offering V2X products and solutions
amounted to RMB3.1 million, RMB36.8 million, RMB101.6 million, RMB74.2 million and
RMB9.2 million, respectively, accounting for 9.8%, 27.8%, 24.8%, 28.7% and 2.3% of our total
revenue for the same periods, respectively. The increase from 2022 to 2024 was primarily
attributed to shorter acceptance period, expanded business scale and improvement of business
model. In 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025, we had two, one,
nil, nil and nil V2X projects with delay in project acceptance. The revenue for the two in 2022 was
RMB68.5 million in total, which were recognized in June 2023 and May 2024, and the revenue for
the one in 2023 was RMB1.3 million, which was recognized in March 2024. See “—
Period-to-Period Comparison of Results of Operations.”
Intelligent Perception Solutions
We started to generate revenue from sales of intelligent perception solutions in 2023. In 2023
and 2024, revenue generated from sales of intelligent perception solutions amounted to RMB21.4
million and RMB53.6 million, respectively, accounting for 16.1% and 13.1% of our total revenue
for the same years, respectively. In the six months ended June 30, 2024 and 2025, revenue
generated from sales of intelligent perception solutions decreased from RMB28.2 million to
RMB20.5 million, accounting for 10.9% and 5.0% of our total revenue, respectively, primarily
because we did not record revenue from sales of our TAPS in the six months ended June 30, 2025,
mainly due to temporary fluctuations in demand from certain customers and the impact of project
acceptance cycles.
During the Track Record Period, revenue from our intelligent perception solutions was
primarily generated from the sales of in-vehicle intelligent perception and safety management
solutions for commercial vehicles. See “— Period-to-Period Comparison of Results of Operations.”
During the Track Record Period, we recognized revenue on a gross basis for the majority of
our business and recognized revenue on a net basis for the purchases we initiate on behalf of
customers, mainly V2X. In 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025,
revenue recognized on a net basis is nil, RMB1.0 million, RMB1.1 million, RMB0.2 million and
RMB0.4 million representing nil, 0.8%, 0.3%, 0.1% and 0.1% of our total revenue, respectively.
During the Track Record Period, we recorded payments made on behalf of customers, which
mainly represented payments made by us at the request of our certain V2X customers and one
autonomous driving customer for the purchase of certain project related ancillary products and
services from third-party suppliers on their behalf, primarily including software development
services and autonomous driving related hardware. The suppliers of software development services
FINANCIAL INFORMATION
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--- page 403 ---
and autonomous driving related hardware are designated by the customers. The services and
products are directly delivered by the suppliers to the customers. We are not primarily obligated in
a transaction, do not generally bear the inventory risk and do not have the ability to establish the
price. See “— Discussion of Key Items of Consolidated Statements of Financial Position —
Prepayments and Other Receivables, Current Portion” and “Business — Customers.”
The table below sets forth our revenue breakdown in absolute amounts and as percentages of
our total revenue by customer type for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Mine owner and operator (1) .... 27,098 87.3 61,753 46.6 228,916 55.8 152,323 59.0 374,795 91.8
Government and university .... — — 7,214 5.4 71,835 17.5 69,111 26.7 267 0.1
Commercial vehicle manufacturer . 284 0.9 26,474 20.0 68,017 16.6 26,157 10.1 18,742 4.6
Other corporate customer ..... 3,674 11.8 37,164 28.0 41,268 10.1 10,870 4.2 14,232 3.5
Total ................ 31,056 100.0 132,604 100.0 410,035 100.0 258,461 100.0 408,036 100.0
Note:
(1) We consider mine owners and mine operators the same customer group because the nature of the products and
solutions we provide to them are the same. Some mine owners operate the mining sites themselves whilst others
may outsource the operations to professional mine operators. For our purpose, there is no meaningful difference in
our business relationships with them.
The table below sets forth our revenue breakdown in absolute amounts and as percentages of
our total revenue by geographic locations of the customer’s registration for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Eastern China ........... 25,116 80.9 27,337 20.6 195,146 47.6 155,248 60.1 3,639 0.9
Southwestern China ....... 177 0.6 18,685 14.1 108,336 26.4 81,942 31.7 19,490 4.8
South-Central China ....... 4,171 13.4 59,928 45.1 85,371 20.8 9,095 3.5 18,704 4.6
Northern China .......... 1,592 5.1 26,512 20.0 11,725 2.9 8,589 3.3 272,037 66.6
Northwestern China ....... — — 23 0.1 9,402 2.3 3,587 1.4 93,951 23.0
Northeastern China ........ —— 1 1 9 0 . 15 5 0 . 0————
Overseas (1) ............. ———————— 2 1 5 0 . 1
Total ................ 31,056 100.0 132,604 100.0 410,035 100.0 258,461 100.0 408,036 100.0
FINANCIAL INFORMATION
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--- page 404 ---
Note:
(1) The overseas revenue was generated from an intelligent perception solutions project developed jointly with a
foreign university for research purposes.
Cost of Sales
Our cost of sales amounted to RMB37.1 million, RMB105.8 million, RMB308.6 million,
RMB214.1 million and RMB338.3 million in 2022, 2023, 2024 and the six months ended June 30,
2024 and 2025, respectively. During the Track Record Period, our cost of sales primarily consisted
of (i) material and processing costs, (ii) warranties, (iii) share-based payments, (iv) employee
benefits expenses, and (v) provision for inventories. The following table sets forth a breakdown of
our cost of sales by nature in absolute amount and as a percentage of our total cost of sales for the
years indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Material and processing costs ... 8,968 24.3 71,502 67.6 257,080 83.3 185,438 86.6 312,122 92.3
Warranties (1) ............ 970 2.6 4,366 4.1 12,282 4.0 10,886 5.1 18,905 5.6
Share-based payments ...... ———— 12,658 4.1 — — 123 0.0
Employee benefits expenses .... 19,837 53.5 14,696 13.9 8,758 2.8 5,868 2.7 2,595 0.8
Provision for inventories ..... 5,235 14.1 11,825 11.2 3,673 1.2 753 0.4 985 0.3
Others (2) .............. 2,041 5.5 3,392 3.2 14,144 4.6 11,137 5.2 3,598 1.0
Total ................ 37,051 100.0 105,781 100.0 308,595 100.0 214,082 100.0 338,328 100.0
Notes:
(1) We provide product warranties on all new goods based on the contracts with our customers at the time of sale of
goods.
(2) Others mainly include outsourcing labor costs, office and traveling expenses, short-term lease expenses, legal,
consulting and other professional fees and depreciation and amortization.
Our material and processing costs increased from RMB9.0 million in 2022 to RMB71.5
million in 2023 and further increased to RMB257.1 million in 2024 and further increased from
RMB185.4 million in the six months ended June 30, 2024 to RMB312.1 million in the six months
ended June 30, 2025, primarily due to an increase in the solution and product deliveries of
autonomous mining products and solutions during the same periods.
FINANCIAL INFORMATION
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--- page 405 ---
Our warranties increased from RMB1.0 million in 2022 to RMB4.4 million in 2023 and
further increased to RMB12.3 million in 2024 and further increased from RMB10.9 million in the
six months ended June 30, 2024 to RMB18.9 million in the six months ended June 30, 2025,
generally in line with the growth in revenue given that we typically offer warranties at the delivery
of most of our projects, and in light of the rapid ramp-up of our sales scale in the intelligent
driving.
We recorded share-based payments of RMB12.7 million in 2024, primarily due to our Share
Incentive Scheme adopted and approved on September 23, 2024. We recorded share-based
payments of nil in the six months ended June 30, 2024 and RMB0.1 million in the six months
ended June 30, 2025, respectively, primarily due to our Share Incentive Scheme adopted and
approved on September 23, 2024.
We recorded relatively higher employee benefits expenses of RMB19.8 million in 2022,
primarily due to (i) the significant number of our employees in project implementation, and (ii) the
relatively higher employee expenses resulting from the large-scale implementation of our
intelligent driving project in Jurong, Jiangsu (the “ Jurong Project ”) in 2022, which has
sophisticated implementation requirements therefore took up significant manpower. According to
CIC, the Jurong Project marked a significant milestone as China (including Hong Kong, Macau
and Taiwan)’s first autonomous electric mining project with full mining area coverage, which is
also the first nationwide autonomous mining project certified by the NlM to exceed the efficiency
of manual operations. After the acceptance of the Jurong Project, our employee benefits expenses
gradually decreased from RMB19.8 million in 2022 to RMB14.7 million in 2023 and RMB8.8
million in 2024, and further decreased from RMB5.9 million in the six months ended June 30,
2024 to RMB2.6 million in the six months ended June 30, 2025.
Our provision for inventories increased from RMB5.2 million in 2022 to RMB11.8 million in
2023, primarily due to (i) the higher impairment of our raw materials due to their aging, and (ii)
the increased impairment loss on our Chongqing V2X Project with Customer L. The project was
initiated implementation in August 2021 and passed customer acceptance in May 2024. See
“Business — Our Offerings — V2X — Application Scenarios — Use Cases — National-level V2X
pilot zones” for details of the project and “Business — Customers — Major Customers” for details
of Customer L. Our provision for impairment of inventories decreased from RMB11.8 million in
2023 to RMB3.7 million in 2024, primarily due to the settlement of the aforementioned V2X
project in 2024 which resulted in the write-off of a relatively larger provision. Our provision for
impairment of inventories remained relatively stable at RMB0.8 million in the six months ended
June 30, 2024 and RMB1.0 million in the six months ended June 30, 2025.
FINANCIAL INFORMATION
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--- page 406 ---
The following table sets forth the breakdown of provision for inventories for the periods
indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
At the beginning of the year/period .. 2,004 7,239 18,979 18,979 7,673
Provision for inventories .......... 5,235 11,825 3,673 753 985
— attributable to Chongqing V2X
Project .................... 342 6,934 — — —
Provision for inventories
written off (1) ................ — 85 14,979 7,919 967
— attributable to Chongqing V2X
Project (2)................... — — 7,816 7,816 —
At the end of the year/period ....... 7,239 18,979 7,673 11,813 7,691
Notes:
(1) At the end of each reporting period, inventories are stated at the lower of cost and net realizable value. The
provision of inventories is recognized based on the difference between cost and net realizable value. The net
realizable value is the estimated selling price in the ordinary course of business less the estimated costs of
completion and the estimated costs necessary to make the sale. If the net realizable value of inventories which have
been made provision increased, the provision of these inventories will be reversed. If the inventories which have
been made provision are sold, the provision of these inventories will be written off. See Note 2.2.1 and 4(c) of the
Accountant’s Report included in Appendix I to this prospectus.
(2) Our Chongqing V2X Project is one of the largest national-level V2X pilot zones and involved complex technology.
See “Business — Our Offerings — Our Major Projects” for details of this project. The overall implementation
progress of the project was delayed mainly due to the COVID-19 pandemic, resulting in the project’s overall input
exceeding expectations. As a result, the estimated selling price less the estimated costs of completion and the
estimated costs necessary to make the sale exceeded the cost of inventory for this project. We had already made
sufficient provision for inventories during the Track Record Period. This project was completed and accepted by the
customer in May 2024, and the provision for inventories for it was written off at the same time of recognition of
revenue and cost of sales.
FINANCIAL INFORMATION
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--- page 407 ---
Our other cost of sales items remained relatively stable in 2022, 2023, and increased to
RMB14.1 million in 2024, primarily because we incurred technical service fee of RMB10.4
million in 2024, mainly because we outsourced ancillary automated driving platform and cloud
services to an independent third party supplier that met our technical requirements to ensure
smoother project delivery in our V2X project in Liangjiang New Area, Chongqing. Our other cost
of sales items amounted to RMB11.1 million in the six months ended June 30, 2024, which was
relatively higher than the RMB3.6 million recorded in the same period of 2025, primarily due to
the aforementioned reason.
The following table sets forth a breakdown of our cost of sales by products and solutions in
absolute amount and as a percentage of our total cost of sales for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Autonomous driving ........ 35,017 94.5 59,892 56.6 196,000 63.6 130,904 61.1 319,386 94.4
Closed-environment
autonomous mining products
and solutions ......... 33,368 90.0 51,938 49.1 191,822 62.2 130,600 61.0 317,561 93.9
Closed-environment
autonomous logistics truck
solution ........... 1,649 4.5 7,954 7.5 4,178 1.4 304 0.1 1,825 0.5
V2X ................ 2,034 5.5 30,278 28.6 84,702 27.4 68,511 32.0 7,063 2.1
Intelligent perception ....... — — 15,611 14.8 27,893 9.0 14,667 6.9 11,879 3.5
Total ................ 37,051 100.0 105,781 100.0 308,595 100.0 214,082 100.0 338,328 100.0
Our cost of sales for autonomous driving amounted to RMB35.0 million, RMB59.9 million,
RMB196.0 million, RMB130.9 million and RMB319.4 million respectively, in 2022, 2023, 2024
and the six months ended June 30, 2024 and 2025, which was generally in line with our revenue
from autonomous driving during the same periods. Meanwhile, our cost of sales for V2X amounted
to RMB2.0 million, RMB30.3 million, RMB84.7 million, RMB68.5 million and RMB7.1 million,
respectively, in 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025, corresponding
to the revenue as well. See “— Period-to-Period Comparison of Results of Operations.”
FINANCIAL INFORMATION
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--- page 408 ---
Gross Profit/(Loss) and Gross Profit/(Loss) Margin
We recorded gross loss of RMB6.0 million in 2022 and gross profit of RMB26.8 million in
2023 and gross profit of RMB101.4 million in 2024, respectively. We recorded gross profit of
RMB44.4 million in the six months ended June 30, 2024 and gross profit of RMB69.7 million in
the six months ended June 30, 2025, respectively. Our gross margin was -19.3%, 20.2%, 24.7%,
17.2% and 17.1% in 2022, 2023, 2024 and the six months ended June 30, 2024 and 2025,
respectively. The following table sets forth a breakdown of our gross profit/(loss) and gross
profit/(loss) margin by products and solutions for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Gross
profit/(loss)
Gross
profit/(loss)
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)
Autonomous driving ........ (7,019) (25.1) 14,526 19.5 58,887 23.1 25,139 16.1 58,978 15.6
Closed-environment
autonomous mining products
and solutions ......... (6,181) (22.7) 12,194 19.0 54,813 22.2 21,856 14.3 58,259 15.5
Closed-environment
autonomous logistics truck
solution ........... (838) (103.3) 2,332 22.7 4,074 49.4 3,283 91.5 719 28.3
V2X ................ 1,024 33.5 6,534 17.7 16,889 16.6 5,726 7.7 2,116 23.1
Intelligent perception ....... — — 5,763 27.0 25,664 47.9 13,514 48.0 8,614 42.0
Total ................ (5,995) (19.3) 26,823 20.2 101,440 24.7 44,379 17.2 69,708 17.1
FINANCIAL INFORMATION
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--- page 409 ---
We recorded gross loss of RMB6.0 million and gross loss margin of 19.3% in 2022, mainly
attributable to (i) the gross loss in the Jurong Project, our first large-scale implementation of an
autonomous mining project with sophisticated requirements and significant manpower investment,
which incurred a gross loss in 2022 because we adopted competitive pricing to secure market
entry, and (ii) the gross loss in closed-environment autonomous logistics truck solution as the
gross margin of such business was vulnerable to the gross loss of certain individual project in
2022 due to the relatively limited business scale at initial commercialization stage. Our gross
profit margin increased from 20.2% in 2023 to 24.7% in 2024, as a result of (i) the gross profit
margin improvements in intelligent driving, and (ii) the commencement of intelligent perception,
which has recorded significantly higher gross profit margin since 2023. Our gross profit margin
remained relatively stable at 17.2% in the six months ended June 30, 2024 and 17.1% in the six
months ended June 30, 2025. See “— Period-to-Period Comparison of Results of Operations.”
Other Income
During the Track Record Period, our other income included (i) government grants, (ii)
super-input V AT credit, and (iii) others, primarily consists of non-operating income in relation to
our disposal of fixed assets. The following table sets forth a breakdown of our other income for
the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Government grants ........ 7,265 98.1 10,979 98.0 5,096 68.4 3,494 60.2 730 84.8
Super-input V AT credit ...... — — 18 0.2 2,215 29.7 2,161 37.3 1 0.1
Others (1) .............. 141 1.9 202 1.8 144 1.9 143 2.5 130 15.1
Total ................ 7,406 100.0 11,199 100.0 7,455 100.0 5,798 100.0 861 100.0
Note:
(1) Others primarily consists of non-operating income in relation to our disposal of fixed assets.
FINANCIAL INFORMATION
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--- page 410 ---
Other (Losses)/Gains, Net
During the Track Record Period, our other (losses)/gains, net included (i) change in fair value
of financial assets at FVTPL, (ii) gain on lease termination, (iii) losses and gains on disposal of
property, plant and equipment, and (iv) foreign currency exchange gain/(loss). The following table
sets forth a breakdown of our other (losses)/gains, net for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Change in fair value of financial assets
at FVTPL. ................... 129 591 (70) (102) 396
Gain on lease termination ........... —9 08 0 7—
Losses and gains on disposal of/written
off property, plant and equipment ... (15) 120 (20) (7) (1)
Foreign currency exchange gain/(loss) .. 1 — (9) — 6
Total ......................... 115 801 (19) (102) 401
Impairment Losses
During the Track Record Period, our impairment losses primarily included impairment losses
on (i) trade and notes receivables, (ii) contract assets, (iii) other receivables, and (iv) financial
guarantee contracts liability. We recorded financial guarantee contracts liabilities of RMB6.3
million in 2024, primarily in relation to our finance lease arrangement in the same period. See
“Business — Customers — Finance Lease Arrangements.” The following table sets forth a
breakdown of our impairment losses for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Impairment losses under ECL model,
net of reversal
Trade and notes receivables ......... (4,838) 4,131 (15,550) (1,832) (26,216)
Contract assets .................. (14) 95 (163) (283) (1,205)
Other receivables ................ (240) (451) (7,059) (274) (12,796)
Financial guarantee contracts liability .. — (186) (6,266) (2,891) (44,063)
Total ......................... (5,092) 3,589 (29,038) (5,280) (84,280)
FINANCIAL INFORMATION
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--- page 411 ---
Research and Development Expenses
During the Track Record Period, our research and development expenses consisted of (i)
share-based payments, (ii) employee benefits expenses, (iii) depreciation and amortization, (iv)
professional service fees, including service fees of field testing and data annotation services
required for testing and improving intelligent driving performance, (v) raw material and
consumables used, and (vi) others, mainly include office and traveling expenses and short-term
lease expenses. Our research and development expenses amounted to RMB110.5 million, RMB90.4
million, RMB193.2 million, RMB35.3 million and RMB151.3 million in 2022, 2023, 2024 and the
six months ended June 30, 2024 and 2025, respectively. Historically, we have made significant
investments in our research and development activities as we continued to develop our products
and solutions and expanded our research and development team. During the Track Record Period,
we did not capitalize R&D expenses nor allocate them by products. The following table sets forth
a breakdown of our research and development expenses in absolute amount and as a percentage of
our total research and development expenses for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Share-based payments ...... ———— 109,529 56.7 — — 107,692 71.2
Employee benefits expenses .... 84,100 76.2 68,582 75.8 65,235 33.8 27,469 77.7 35,221 23.3
Depreciation and amortization .. 13,137 11.9 10,007 11.1 8,704 4.5 4,311 12.2 4,641 3.1
Professional service fees ..... 7,456 6.7 4,680 5.2 4,524 2.3 987 2.8 1,301 0.9
Raw material and consumables
used ............... 4,017 3.6 4,856 5.4 3,910 2.0 2,003 5.7 1,186 0.8
Others (1) .............. 1,797 1.6 2,271 2.5 1,279 0.7 569 1.6 1,276 0.7
Total ................ 110,507 100.0 90,396 100.0 193,181 100.0 35,339 100.0 151,317 100.0
Note:
(1) Others mainly include office and traveling expenses and short-term lease expenses.
FINANCIAL INFORMATION
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--- page 412 ---
Selling Expenses
During the Track Record Period, our selling expenses consisted of (i) share-based payments,
(ii) employee benefits expenses, (iii) marketing expenses, mainly in relation to our promotional
activities, advertising, and business development services from third-parties we engaged, (iv)
office and traveling expenses, (v) depreciation and amortization, and (vi) others, mainly include
outsourcing labor costs, short-term lease expenses and legal, consulting and other professional
fees. Our selling expenses amounted to RMB23.1 million, RMB31.4 million, RMB64.4 million,
RMB23.6 million and RMB44.3 million in 2022, 2023, 2024 and the six months ended June 30,
2024 and 2025, respectively. The following table sets forth a breakdown of our selling expenses in
absolute amount and as a percentage of our total selling expenses for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Share-based payments ...... ———— 21,591 33.5 — — 21,010 47.4
Employee benefits expenses .... 11,951 51.7 14,058 44.8 17,394 27.0 7,441 31.6 6,540 14.8
Marketing expenses ........ 6,760 29.2 10,017 31.9 14,578 22.6 12,477 52.8 12,211 27.6
Office and traveling expenses ... 2,431 10.5 4,281 13.6 7,473 11.6 2,087 8.8 3,856 8.7
Depreciation and amortization .. 1,816 7.8 1,921 6.1 1,536 2.4 703 3.0 525 1.2
Others (1) .............. 190 0.8 1,127 3.6 1,868 2.9 903 3.8 146 0.3
Total ................ 23,148 100.0 31,404 100.0 64,439 100.0 23,611 100.0 44,288 100.0
Note:
(1) Others mainly include outsourcing labor costs, short-term lease expenses and legal, consulting and other
professional fees.
FINANCIAL INFORMATION
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--- page 413 ---
General and Administrative Expenses
During the Track Record Period, our general and administrative expenses consisted of (i)
share-based payments, (ii) employee benefits expenses, (iii) depreciation and amortization, (iv)
office and traveling expenses, (v) listing expenses, (vi) legal, consulting and other professional
fees, and (vii) others, mainly include short-term lease expenses and outsourcing labor costs. Our
administrative expenses amounted to RMB69.0 million, RMB97.8 million, RMB300.7 million,
RMB56.1 million and RMB199.7 million in 2022, 2023, 2024 and the six months ended June 30,
2024 and 2025, respectively. The increase in our general and administrative expenses from 2022 to
2024 was primarily attributable to our share-based payments, growing employee benefits expenses
as well as depreciation and amortization, resulting from regular compensation adjustments and the
reclassification of our industrial park from construction in progress into fixed assets. The
following table sets forth a breakdown of our general and administrative expenses in absolute
amount and as a percentage of our total administrative expenses for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount % Amount % Amount % Amount % Amount %
(RMB in thousands, except for percentage)
(unaudited)
Share-based payments ...... ———— 176,166 58.6 — — 137,743 69.0
Employee benefits expenses .... 39,187 56.8 53,873 55.0 62,849 20.9 31,735 56.6 25,371 12.7
Depreciation and amortization .. 7,247 10.5 16,436 16.8 23,421 7.8 12,233 21.8 11,392 5.7
Office and traveling expenses ... 15,704 22.8 16,502 16.9 15,042 5.0 7,039 12.6 7,727 3.9
Listing expenses ......... ———— 1 1,896 4.0 — — 9,379 4.7
Legal, consulting and other
professional fees ........ 5,488 8.0 7,430 7.6 4,771 1.6 2,520 4.5 3,467 1.7
Others (1) .............. 1,343 1.9 3,586 3.7 6,576 2.1 2,543 4.5 4,599 2.3
Total ................ 68,969 100.0 97,827 100.0 300,721 100.0 56,070 100.0 199,678 100.0
Note:
(1) Others mainly include short-term lease expenses and outsourcing labor costs.
FINANCIAL INFORMATION
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--- page 414 ---
Finance Costs, Net
During the Track Record Period, our finance income primarily included (i) interest income
from bank deposits, and (ii) interest income from term deposits. During the same periods, our
finance costs primarily included (i) financial cost on financial instruments with preferred rights at
amortized cost, and (ii) interest expenses on bank borrowings. The following table sets forth a
breakdown of our finance costs, net for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
Amount Amount Amount Amount Amount
(RMB in thousands)
(unaudited)
Finance income:
Interest income from financial assets at
FVTPL ...................... 258 11 — — 16
Interest income from non-current trade
receivables ................... ———— 1,288
Interest income from bank deposits .... 4,424 2,866 2,187 1,087 688
Interest income from term deposits .... 4,276 5,215 2,499 2,124 74
Interest income from loans to a third
party ....................... — 71 377 161 221
Interest income from loan to a related
party of the Company ............ —1 6———
8,958 8,179 5,063 3,372 2,267
Finance costs:
Financial cost on financial instruments
with preferred rights at amortized
cost ........................ (104,136) (117,528) (128,593) (63,119) (67,923)
Interest income from non-current trade
payables .................... ———— (982)
Interest expenses on trade receivables
financing .................... ———— (24)
Interest expenses on bank borrowings .. (1,156) (3,364) (6,958) (3,431) (4,558)
Interest expenses on lease liabilities ... (350) (208) (165) (68) (32)
(105,642) (121,100) (135,716) (66,618) (73,519)
Finance costs, net ............... (96,684) (112,921) (130,653) (63,246) (71,252)
FINANCIAL INFORMATION
– 404 –


--- page 415 ---
Income Tax Credit
Our income tax credit amounted to RMB39.9 million, RMB35.1 million, RMB28.3 million,
RMB10.9 million and RMB24.8 million in 2022, 2023, 2024 and the six months ended June 30,
2024 and 2025, respectively. We are subject to income tax on an entity basis on profits arising in
or derived from tax jurisdictions in which members of our Group are domiciled and operate. See
Note 13 of the Accountant’s Report included in Appendix I to this prospectus.
Mainland China
In accordance with the Enterprise Income Tax Law (“ EIT Law ”), Foreign Investment
Enterprises (“ FIEs”) and domestic companies established in Mainland China are subject to
Enterprise Income Tax (“ EIT”) at a rate of 25%. Our subsidiaries in the PRC are subject to PRC
income tax at 25% unless otherwise specified. Our Company qualified as a high and new
technology enterprise (“ HNTE”) and enjoyed a preferential tax rate of 15% from December 2022
to December 2025. One of our subsidiaries, Novodriv Chongqing, qualified as a HNTE and
enjoyed a preferential tax rate of 15% from October 2022 to October 2025. As of June 30, 2025,
we and Novodriv Chongqing Ltd. are in the process of reapplying for HNTE status for an
additional three-year term. We and Novodriv Chongqing Ltd. were both in accumulated loss
position for the years ended December 31, 2022, 2023, 2024 and the six months ended June 30,
2025. Pursuant to the relevant regulations on extension for expiries of unused tax losses of HNTE
issued in August 2018, the expiry period of the accumulated unexpired tax losses of us and
Novodriv Chongqing Ltd., which are qualified as HNTE, will expire in 10 years.
Hong Kong
Our subsidiary in Hong Kong is subject to Hong Kong profits tax of which the tax rate was
16.5% up to April 1, 2018 when the two-tiered profits tax regime took effect, under which the tax
rate is 8.25% for assessable profits in the first Hong Kong Dollars 2 million and 16.5% for any
assessable profits in excess. Since the subsidiary did not have assessable profits during the Track
Record Period, no Hong Kong profits tax has been provided.
As of the Latest Practicable Date, we did not have any dispute with any tax authority. During
the Track Record Period and up to the Latest Practicable Date, we have not been subject to any tax
investigation, enquiries, penalties or surcharges.
FINANCIAL INFORMATION
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--- page 416 ---
PERIOD-TO-PERIOD COMPARISON OF RESULTS OF OPERATIONS
Six months ended June 30, 2025 compared with Six months ended June 30, 2024
Revenue
Our revenue increased from RMB258.5 million in the six months ended June 30, 2024 to
RMB408.0 million in the six months ended June 30, 2025, primarily due to an increase in revenue
generated from autonomous driving, mainly related to the intelligent mining project we
collaborated on with Customer M.
Autonomous driving
Our revenue from autonomous driving significantly increased from RMB156.0 million in the
six months ended June 30, 2024 to RMB378.4 million in the six months ended June 30, 2025,
primarily due to an increase in revenue from our autonomous mining products and solutions,
attributable to increased sales volume resulting from our continual improvements in autonomous
driving products and solutions, enhanced delivery capabilities and increased customer base and
customer recognition. In particular, three large-scale autonomous mining truck projects we
delivered were accepted by customers in the six months ended June 30, 2025.
V2X
Our revenue from V2X products and solutions decreased from RMB74.2 million in the six
months ended June 30, 2024 to RMB9.2 million in the six months ended June 30, 2025, primarily
because (i) the prior period recorded revenue from a national-level V2X pilot zones project, the
Chongqing V2X Project, which contributed a substantial share of revenue and did not recur in the
same period of 2025, and (ii) uncertainty regarding the implementation of industry policies and
standards, which affected potential customers’ procurement decisions and led to temporary
softening of market demand.
Intelligent perception solutions
Our revenue from intelligent perception solutions decreased from RMB28.2 million in the six
months ended June 30, 2024 to RMB20.5 million in the six months ended June 30, 2025, primarily
because we did not record revenue from sales of our TAPS in the six months ended June 30, 2025,
mainly due to temporary fluctuations in demand from certain customers and the impact of project
acceptance cycles.
FINANCIAL INFORMATION
– 406 –


--- page 417 ---
Cost of sales
Our cost of sales increased from RMB214.1 million in the six months ended June 30, 2024 to
RMB338.3 million in the six months ended June 30, 2025, primarily due to an increase in cost of
sales from intelligent driving.
Autonomous driving
Our cost of sales from autonomous driving increased from RMB130.9 million in the six
months ended June 30, 2024 to RMB319.4 million in the six months ended June 30, 2025,
primarily due to the increase in material and processing costs resulting from increased sales
volume.
V2X
Our cost of sales from V2X decreased from RMB68.5 million in the six months ended June
30, 2024 to RMB7.1 million in the six months ended June 30, 2025, generally in line with the
fluctuations in revenue.
Intelligent perception solutions
Our cost of sales from intelligent perception solutions decreased from RMB14.7 million in
the six months ended June 30, 2024 to RMB11.9 million in the six months ended June 30, 2025,
generally in line with the decrease in revenue.
Gross profit and gross profit margin
As a result of the foregoing, our gross profit increased from RMB44.4 million in the six
months ended June 30, 2024 to RMB69.7 million in the six months ended June 30, 2025. Our
gross profit margin remained relatively stable at 17.2% and 17.1%, respectively, in the six months
ended June 30, 2024 and 2025.
Our gross profit margin decreased from 24.7% in 2024 to 17.1% in the six months ended
June 30, 2025, primarily due to changes in revenue structure, including a higher proportion of
revenue from autonomous mining products and solutions, which have relatively lower margins. In
addition, the gross profit margin for autonomous mining products and solution decreased from
22.2% in 2024 to 15.5% in the six months ended June 30, 2025, mainly due to a decrease in
certain project prices under strong customer bargaining power. Furthermore, we recorded a
relatively high gross profit margin of closed-environment autonomous logistics truck solution in
2024, primarily driven by certain projects that were predominantly based on technology and
FINANCIAL INFORMATION
– 407 –


--- page 418 ---
software services rather than hardware, which did not occur in the six months ended June 30,
2025. We also recorded a decrease in gross profit margin for intelligent perception, mainly due to
changes in our solution mix, as we did not record revenue from sales of TAPS, which carries a
relatively higher gross margin, in the six months ended June 30, 2025, mainly because of
temporary fluctuations in demand from certain customers and the impact of project acceptance
cycles.
Autonomous driving
Our gross profit margin for autonomous driving remained relatively stable at 16.1% and
15.6%, respectively, in the six months ended June 30, 2024 and 2025, primarily due to the
combined effect of an increase in gross profit margin of autonomous mining products and solutions
and a decrease of closed-environment autonomous logistics truck solution. The gross profit margin
of autonomous mining products and solutions increased from 14.3% in the six months ended June
30, 2024, to 15.5% in the same period of 2025, mainly driven by economies of scale resulting
from increased sales volume. In contrast, closed-environment autonomous logistics truck solution
had a relatively high gross profit margin in the six months ended June 30, 2024, primarily because
the projects delivered in such period were predominantly based on technology and software
services rather than hardware, resulting in a relatively higher margin.
V2X
Our gross profit margin for V2X increased from 7.7% in the six months ended June 30, 2024
to 23.1% in the six months ended June 30, 2025, primarily due to the relatively low gross profit
margin from the Chongqing V2X project in the six months ended June 30, 2024, which did not
occur during the same period in 2025. See “Business — Our Offerings — Our Major Projects” and
“— Description of Major Components of Our Results of Operations — Cost of Sales” for details
of this project. The gross margin for the six months ended June 30, 2024 and 2025 was more
susceptible to individual project impacts due to relatively smaller revenue contributions compared
to full-year operations.
Intelligent perception solutions
Our gross profit margin for intelligent perception solutions decreased from 48.0% in the six
months ended June 30, 2024 to 42.0% in the six months ended June 30, 2025, primarily due to
changes in our solution mix, as we did not record revenue from sales of our TAPS, which carries a
relatively higher gross margin, in the six months ended June 30, 2025, mainly due to temporary
fluctuations in demand from certain customers and the impact of project acceptance cycles.
FINANCIAL INFORMATION
– 408 –


--- page 419 ---
The high gross margin of our TAPS is primarily attributable to its advanced performance and
the premium pricing it commands as the only product in China capable of providing independent
safety perception for trains.
Other Income
Our other income decreased from RMB5.8 million in the six months ended June 30, 2024 to
RMB0.9 million in the six months ended June 30, 2025, primarily due to (i) a decrease in
super-input V AT credit as the application process for such credit had not yet been completed
following the change of our registered name on January 8, 2025, and (ii) a decrease in government
grants, as certain non-recurring grants related to our business operations and research and
development activities did not occur.
Other Gains/(Losses), Net
We recorded net other gains of RMB0.4 million in the six months ended June 30, 2025 as
compared to net other losses of RMB0.1 million in the six months ended June 30, 2024, primarily
due to change in fair value of financial assets at FVTPL in relation to our long term equity
investment.
Impairment Losses
Our impairment losses increased from RMB5.3 million in the six months ended June 30,
2024 to RMB84.3 million in the six months ended June 30, 2025, primarily due to (i) impairment
losses of RMB56.9 million for financial guarantee contract liabilities and other receivables arising
from Customer K’s default under its finance lease agreement, and (ii) an increase in impairment
losses of RMB26.2 million related to trade and notes receivables, mainly attributable to (a)
revenue growth, which led to an increase in trade and notes receivable balances, and (b) the aging
of trade receivables from Customer L, which resulted in impairment losses of RMB5.8 million.
See “Business — Customers — Major Customers — Transactions with Customer K” and “—
Discussion of Key Items of Consolidated Statements of Financial Position — Net Current Assets
— Trade and Notes Receivables, Current Portion.”
Research and Development Expenses
Our research and development expenses increased from RMB35.3 million in the six months
ended June 30, 2024 to RMB151.3 million in the six months ended June 30, 2025, primarily due to
share-based payments of RMB107.7 million incurred in relation to our Share Incentive Scheme
adopted and approved on September 23, 2024.
FINANCIAL INFORMATION
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--- page 420 ---
Selling Expenses
Our selling expenses increased from RMB23.6 million in the six months ended June 30, 2024
to RMB44.3 million in the six months ended June 30, 2025, primarily due to share-based payments
of RMB21.0 million incurred in relation to our Share Incentive Scheme adopted and approved on
September 23, 2024.
General and Administrative Expenses
Our general and administrative expenses increased from RMB56.1 million in the six months
ended June 30, 2024 to RMB199.7 million in the six months ended June 30, 2025, primarily due to
(i) share-based payments of RMB137.7 million incurred in relation to our Share Incentive Scheme
adopted and approved on September 23, 2024, and (ii) listing expenses incurred in the six months
ended June 30, 2025.
Finance Costs, Net
Our finance costs increased by 12.7% from RMB63.2 million in the six months ended June
30, 2024 to RMB71.3 million in the six months ended June 30, 2025, primarily due to (i) a
decrease in interest income from term deposits, and (ii) an increase in financial cost on financial
instruments with preferred rights at amortized cost.
Income Tax Credit
Our income tax credit increased from RMB10.9 million in the six months ended June 30,
2024 to RMB24.8 million in the six months ended June 30, 2025.
Loss for the Period
As a result of the foregoing, our loss for the period increased from RMB122.6 million in the
six months ended June 30, 2024 to RMB455.1 million in the six months ended June 30, 2025.
Y ear Ended December 31, 2024 Compared with Y ear Ended December 31, 2023
Revenue
Our revenue increased significantly from RMB132.6 million in 2023 to RMB410.0 million in
2024, due to increases in revenue generated from autonomous driving, V2X and intelligent
perception solutions.
FINANCIAL INFORMATION
– 410 –


--- page 421 ---
Autonomous driving
Our revenue from autonomous driving increased significantly from RMB74.4 million in 2023
to RMB254.9 million in 2024, primarily due to an increase in revenue from our autonomous
mining products and solutions, attributable to increased sales volume resulting from our continual
improvements in autonomous driving products and solutions, enhanced delivery capabilities and
increased customer base and customer recognition.
V2X
Our revenue from V2X products and solutions increased significantly from RMB36.8 million
in 2023 to RMB101.6 million in 2024, primarily due to (i) revenue recognition in 2024 from
projects implemented in the previous period, (ii) the accelerated expansion of business scale and
business model has reached its fast expansion stage after the commercialization, and (iii) increased
sales volume driven by the growth of customer demand.
Intelligent perception solutions
Our revenue from intelligent perception solutions increased significantly from RMB21.4
million in 2023 to RMB53.6 million in 2024. This was primarily due to the increased sales volume
of in-vehicle intelligent perception and safety management solution resulting from the successful
commercialization of intelligent perception projects with major automotive OEMs, especially
factory-installation of our in-vehicle intelligent perception and safety management solution, as we
started to generate revenue from such business in June 2023, with business expansion thereafter.
Cost of Sales
Our cost of sales increased significantly from RMB105.8 million in 2023 to RMB308.6
million in 2024, which was generally in line with our revenue growth.
Autonomous driving
Our cost of sales from autonomous driving increased from RMB59.9 million in 2023 to
RMB196.0 million in 2024, primarily due to the increase in material and processing costs resulting
from increased sales volume.
V2X
Our cost of sales from V2X increased from RMB30.3 million in 2023 to RMB84.7 million in
2024, generally in line with the increase in revenue.
FINANCIAL INFORMATION
–4 1 1–


--- page 422 ---
Intelligent perception solutions
Our cost of sales from intelligent perception solutions increased from RMB15.6 million in
2023 to RMB27.9 million in 2024, primarily due to the increased sales volume of in-vehicle
intelligent perception and safety management solution.
Gross Profit and Gross Profit Margin
As a result of the foregoing, our gross profit increased significantly from RMB26.8 million in
2023 to RMB101.4 million in 2024. Our gross profit margin increased from 20.2% in 2023 to
24.7% in 2024 mainly as a result of increased gross profit margins in intelligent driving and
intelligent perception solutions. In particular:
Autonomous driving
Our gross profit margin for autonomous driving increased from 19.5% in 2023 to 23.1% in
2024, primarily due to (i) economies of scale resulting from increased sales volume, and (ii) the
significant increase in gross profit margin of closed-environment autonomous logistics truck
solution, as the projects delivered in 2024 were predominantly based on technology and software
services instead of hardware, resulting in a relatively higher gross profit margin.
V2X
Our gross profit margin for V2X remained relatively stable at 17.7% and 16.6% in 2023 and
2024, respectively.
Intelligent perception solutions
Our gross profit margin for intelligent perception solutions increased from 27.0% in 2023 to
47.9% in 2024, primarily because (i) 2023 marked our initial commercialization of delivery
intelligent perception solutions, during which we undertook relatively higher development costs for
project implementation, and (ii) the increased average selling price in train autonomous perception
system and the relatively stable average selling price in in-vehicle intelligent safety management
solution.
Other Income
Our other income decreased by 33.4% from RMB11.2 million in 2023 to RMB7.5 million in
2024, primarily due to a decrease in government grants, as certain non-recurring grants related to
our business operations and research and development activities were not occurred in 2024,
partially offset by an increase in super-input V AT credit as we are eligible for additional V AT
credits amounting to 5% of the current period’s creditable V AT input as a result of the V AT reform.
See Note 9 to the Accountant’s Report included in Appendix I to this prospectus.
FINANCIAL INFORMATION
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--- page 423 ---
Other (Losses)/Gains, Net
We recorded net other losses of RMB19 thousand in 2024 as compared to net other gains of
RMB0.8 million in 2023, primarily due to change in fair value of financial assets at FVTPL in
relation to our long term equity investment.
Impairment Losses
We recorded reversal of net impairment losses of RMB3.6 million and impairment losses of
RMB29.0 million in 2023 and 2024, respectively, primarily due to (i) reversal of impairment
losses on trade and notes receivables in relation to the Jurong Project in 2023 and (ii) impairment
loss in 2024: (a) RMB15.6 million of our impairment losses were related to trade and notes
receivables, which were in line with our revenue growth, RMB6.6 million of which was also
related to customers with impairment losses for deposits and payments made on behalf of
customers, which mainly include customers for whom we made payments on behalf of; (b)
RMB6.3 million of our impairment losses were related to our financial guarantee contract
liabilities in relation to customers who purchased autonomous mining trucks from us through
finance lease arrangements (see “Business — Customers — Finance Lease Arrangements”),
including Customer K, as well as two other customers who are mine operators (“ Customer Y and
Customer Z ”); and (c) RMB7.1 million of our impairment losses were related to our other
receivables, mainly related to our loans to Customer K (RMB3.2 million) (see “— Prepayments
and Other Receivables, Current Portion”), with the remaining attributed to deposits (RMB4.0
million) and payments made on behalf of customers (reversal of RMB0.1 million).
During the Track Record Period, the revenue recognized from customers associated with
impairment loss related to our financial guarantee contract liabilities was nil, RMB8.9 million,
RMB153.4 million, RMB152.3 million and nil in 2022, 2023, 2024 and the six months ended June
30, 2024 and 2025, respectively. The table below sets forth the breakdown of the aforementioned
revenue by customer for the indicated period:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Customer Y (1) .................. — 4,425 — — —
Customer Z (2) ................... — 4,425 — — —
Customer K .................... — — 153,361 152,299 —
Total ......................... — 8,850 153,361 152,299 —
Notes:
(1) Customer Y was founded in 2006 and registered in Henan. It primarily engages in blasting operations and the
extraction of non-coal mining mineral resources.
(2) Customer Z was founded in 2010 and registered in Henan. It primarily engages in blasting operations and the
extraction of non-coal mining mineral resources.
FINANCIAL INFORMATION
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The revenue recognized from customers associated with impairment loss for deposits and
payments made on behalf of customers was RMB2.8 million, RMB39.5 million, RMB280.9
million, RMB243.0 million and RMB25.8 million in 2022, 2023, 2024 and the six months ended
June 30, 2024 and 2025, respectively. The table below sets forth the breakdown of the
aforementioned revenue by customer for the indicated period:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Customer K .................... — — 153,361 152,299 —
Customer L (1) ................... — — 60,133 60,133 —
Customer J ..................... — 8,373 11,723 — —
Customer G .................... — 14,660 — — 7,591
Customer B .................... 2,750 1 1———
Customer X (2) ................... — — 395 395 —
Customer W (3) .................. — 11,691 43,999 21,422 18,209
Customer Q (4) .................. — — 8,718 8,718 42
Customer R (5) .................. — 4,743 2,522 — —
Customer S (6) .................. —— 2——
Total ........................ 2,750 39,477 280,853 242,967 25,842
Notes:
(1) We recorded trade receivables aged over six months of RMB2.3 million, RMB2.3 million, RMB28.5 million,
RMB2.3 million and RMB28.5 million to Customer L in 2022, 2023, 2024 and the six months ended June 30, 2024
and 2025, respectively. The trade receivable of RMB2.3 million in 2022 was generated from a V2X project, for
which revenue was recognized in 2020. The revenue from Customer L in 2024 was recognized in the first half of
the year and derived from the Chongqing V2X Project. See ”— Discussion of Key Items of Consolidated Statement
of Financial Position — Net Current Assets/(Liabilities) — Trade and Notes Receivables, Current Portion.”
(2) Customer X was founded in 2021 and registered in Jiangsu. It primarily provides comprehensive smart lighting and
smart transportation products and solutions.
(3) Customer W was founded in 2007 and registered in Sichuan. It primarily engages in the manufacturing of vehicles.
FINANCIAL INFORMATION
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(4) Customer Q is a provincial public university in Changsha, Hunan, China.
(5) Customer R is a public university in Chongqing, China.
(6) Customer S was founded in 2021 and registered in Hunan. It primarily engages in the manufacturing and sale of
mechanical and electrical equipment.
Save for Customer K, the proportion of related impairment losses to revenue generated from
such customers was low during the Track Record Period.
We applied the IFRS 9 simplified approach to measure expected credit losses for trade
receivables and contract assets and applied the IFRS 9 general approach to measure expected
credit losses for financial guarantee contract liabilities, notes receivables and other receivables.
The main reason for different approaches used in (i) trade receivables and contract assets, and (ii)
financial guarantee contract liabilities, notes receivables and other receivables is the varying nature
of these receivables. Generally, trade receivables and contract assets are often short-term and high
volume with no significant financing component. Therefore, the simplified approach is adopted. In
contrast, financial guarantee contract liabilities, notes receivables and other receivables often have
longer terms, necessitating a more detailed assessment of credit risk over time. Therefore, the
general approach is adopted. See Note 3 to the Accountant’s Report in Appendix I to this
prospectus.
The provision for impairment of financial instruments is not contingent upon the actual
occurrence of credit losses but is based on the expected potential losses arising from future default
events. The expected credit loss rates are determined by referencing historical settlement,
combined with the current aging structure of balances, economic policies, macroeconomic
indicators, industry risks, and other relevant factors. It is an industry norm to recognize
impairment provisions in relation to finance lease arrangements, according to CIC. The impairment
provisions recognized will likely differ from actual credit loss amounts incurred in the future. As
of the Latest Practicable Date, we have one customer who is in default with respect to certain
payment obligations under its finance lease agreement. See “Business — Customers — Major
Customers — Transactions with Customer K.”
Research and Development Expenses
Our research and development expenses significantly increased from RMB90.4 million in
2023 to RMB193.2 million in 2024, primarily due to share-based payments incurred in relation to
our Share Incentive Scheme adopted and approved on September 23, 2024.
FINANCIAL INFORMATION
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Selling Expenses
Our selling expenses increased by 105.2% from RMB31.4 million in 2023 to RMB64.4
million in 2024, primarily due to (i) share-based payments incurred in relation to our Share
Incentive Scheme adopted and approved on September 23, 2024, and (ii) an increase in marketing
expenses resulting from our enhanced marketing efforts for METAMINE solution, which was in
line with our revenue growth and commercialization strategies during the same period.
General and Administrative Expenses
Our general and administrative expenses increased by 207.4% from RMB97.8 million in 2023
to RMB300.7 million in 2024, primarily due to (i) share-based payments incurred in relation to our
Share Incentive Scheme adopted and approved on September 23, 2024, (ii) an increase in
employee benefits expenses resulting from regular compensation adjustments, and (iii) listing
expenses incurred in 2024.
Finance Costs, Net
Our finance costs increased by 12.1% from RMB112.9 million in 2023 to RMB130.7 million
in 2024, primarily due to an increase in financial cost on financial instruments with preferred
rights at amortized cost.
Income Tax Credit
Our income tax credit decreased by 19.2% from RMB35.1 million in 2023 to RMB28.3
million in 2024, primarily due to a decrease in deductible tax losses.
Loss for the Y ear
As a result of the foregoing, our loss for the period slightly increased from RMB255.1
million in 2023 to RMB580.8 million in 2024.
Y ear Ended December 31, 2023 Compared with Y ear Ended December 31, 2022
Revenue
Our revenue increased significantly from RMB31.1 million in 2022 to RMB132.6 million in
2023, primarily due to increases in revenue generated from our autonomous driving, V2X and
intelligent perception solutions.
FINANCIAL INFORMATION
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Autonomous driving
Our revenue from autonomous driving increased significantly from RMB28.0 million in 2022
to RMB74.4 million in 2023, primarily due to an increase in revenue from our autonomous mining
products and solutions, attributable to increased sales volumes resulting from our continual
improvements in autonomous driving products and solutions.
V2X
Our revenue from V2X products and solutions increased significantly from RMB3.1 million
in 2022 to RMB36.8 million in 2023, primarily due to (i) revenue recognition in 2023 from
projects implemented in the previous year, and (ii) the accelerated expansion of business scale and
business model has reached its fast expansion stage after the commercialization.
Intelligent perception solutions
We started to generate revenue from sales of train autonomous perception system and
in-vehicle intelligent perception and safety management solution and recorded revenue of
RMB21.4 million in 2023.
Cost of Sales
Our cost of sales increased significantly from RMB37.1 million in 2022 to RMB105.8 million
in 2023, which was generally in line with our revenue growth.
Autonomous driving
Our cost of sales from autonomous driving increased from RMB35.0 million in 2022 to
RMB59.9 million in 2023, generally in line with the increase in revenue.
V2X
Our cost of sales from V2X increased from RMB2.0 million in 2022 to RMB30.3 million in
2023, generally in line with the increase in revenue.
Intelligent perception solutions
We record cost of sales of RMB15.6 million in intelligent perception solutions in 2023, as we
started to generate revenue from sales of train autonomous perception system and in-vehicle
intelligent perception and safety management solution.
FINANCIAL INFORMATION
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Gross Profit/(Loss) and Gross Profit/(Loss) Margin
As a result of the foregoing, we recorded gross profit of RMB26.8 million in 2023 as
compared to gross loss of RMB6.0 million in 2022. We recorded gross profit margin of 20.2% in
2023 as compared to gross loss in 2022. Our gross profit margin overturned from 2022 to 2023,
primarily due to (i) economies of scale from accumulated R&D, (ii) potential synergies from the
R&D of Project Jurong spilling over to other similar projects, and (iii) business expansion
following the launch of the higher-margin intelligent perception solutions in 2023.
Autonomous driving
Our autonomous driving overturned from gross loss in 2022 to gross profit margin of 19.5%
in 2023. This improvement was primarily due to (i) the gross loss in Jurong Project, our first
large-scale implementation of an autonomous mining project with sophisticated requirements and
significant manpower investment, which incurred a gross loss in 2022 because we adopted
competitive pricing to secure market entry, (ii) in 2023, our autonomous driving began to benefit
from economies of scale and a shorter project implementation, which decreased our average unit
costs, (iii) the increased average selling price in 2023, and (iv) the shift of our closed-environment
autonomous logistics truck solution from a gross loss to a gross profit. The gross margin of
closed-environment autonomous logistics truck solution was vulnerable to the gross loss of certain
individual project in 2022 due to the relatively limited business scale at initial commercialization
stage, while in 2023, the gross margin recovery to a reasonable level benefiting from economies of
scales as the number of projects increased and the business scale expanded.
V2X
Our gross profit margin for V2X decreased from 33.5% in 2022 to 17.7% in 2023, primarily
due to (i) our competitive pricing strategy to enhance market penetration, (ii) relatively higher cost
of sales resulting from the extension of acceptance period for certain projects and (iii) we are still
at a ramp-up stage.
Intelligent perception solutions
2023 marked our initial commercialization of delivery intelligent perception solutions, and
we recorded gross profit margin of 27.0% from intelligent perception solutions.
FINANCIAL INFORMATION
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Other Income
Our other income increased by 51.2% from RMB7.4 million in 2022 to RMB11.2 million in
2023, primarily due to an increase in government grants we received related to our business
operation and research and development activities.
Other Gains, Net
Our net other gains increased significantly from RMB0.1 million in 2022 to RMB0.8 million
in 2023, primarily due to gain in fair value of financial assets at FVTPL in relation to our long
term equity investment, gain on lease termination in relation to the replacement of leased
properties by one of our subsidiaries and disposal of property, plant and equipment resulting from
the disposal of our spare vehicles in 2023.
Impairment Losses
We recorded reversal of impairment losses of RMB3.6 million in 2023 as compared to
impairment losses of RMB5.1 million in 2022, primarily due to reversal of impairment losses on
trade and notes receivables in relation to the Jurong Project in 2023.
Research and Development Expenses
Our research and development expenses decreased by 18.2% from RMB110.5 million in 2022
to RMB90.4 million in 2023, primarily due to decreases in employee benefits expenses and
depreciation and amortization, which reflects the stabilization of our R&D needs as we advanced
towards commercialization.
Selling Expenses
Our selling expenses increased by 35.7% from RMB23.1 million in 2022 to RMB31.4 million
in 2023, primarily due to increases in employee benefits expenses and marketing expenses, which
was in line with our revenue growth and commercialization strategies during the same period.
General and Administrative Expenses
Our general and administrative expenses increased by 41.8% from RMB69.0 million in 2022
to RMB97.8 million in 2023, primarily due to (i) an increase in employee benefits expenses
resulting from our increased headcount and regular compensation adjustments, and (ii) an increase
in depreciation and amortization in relation to the reclassification of our industrial park from
construction in progress into fixed assets.
FINANCIAL INFORMATION
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Finance Costs, Net
Our finance costs increased by 16.8% from RMB96.7 million in 2022 to RMB112.9 million
in 2023, primarily due to an increase in financial cost on financial instruments with preferred
rights at amortized cost.
Income Tax Credit
Our income tax credit decreased by 12.1% from RMB39.9 million in 2022 to RMB35.1
million in 2023, primarily due to a decrease in deductible tax losses.
Loss for the Y ear
As a result of the foregoing, our loss for the year decreased by 3.0% from RMB263.0 million
in 2022 to RMB255.1 million in 2023.
DISCUSSION OF KEY ITEMS OF CONSOLIDATED STATEMENTS OF FINANCIAL
POSITION
Non-Current Assets and Liabilities
The following table sets forth our non-current assets and liabilities as of the dates indicated:
As of December 31,
As of
June 30,
2022 2023 2024 2025
(RMB in thousands)
Non-current assets
Property, plant and equipment ................. 331,756 332,792 309,612 297,313
Right-of-use assets ........................ 44,497 42,683 41,093 43,020
Intangible assets .......................... 2,575 2,292 1,756 1,942
Deferred tax assets ........................ 117,252 152,318 180,653 205,423
Prepayments and other receivables .............. 3,881 17,486 10,542 11,230
Term deposits ............................ 190,101 5,177 — —
Trade receivables .......................... — — — 39,880
Financial assets at FVTPL .................... 525 2,116 2,541 3,398
Total non-current assets .................... 690,587 554,864 546,197 602,206
Non-current liabilities
Trade payables ............................ — — — 20,251
Borrowings .............................. 101,800 3,700 83,900 94,800
Lease liabilities .......................... 1,875 608 332 180
Financial instruments with preferred rights at
amortized cost .......................... 1,625,922 1,766,025 1,894,618 —
Total non-current liabilities .................. 1,729,597 1,770,333 1,978,850 115,231
FINANCIAL INFORMATION
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Property, Plant and Equipment
Our property, plant and equipment primarily consisted of buildings, vehicles, machinery and
equipment, office equipment and others, tested field and related equipment, construction in
progress and leasehold improvements. Our property, plant and equipment remained relatively
stable at RMB331.8 million as of December 31, 2022 and RMB332.8 million as of December 31,
2023, Our property, plant and equipment further decreased by 7.0% from RMB332.8 million as of
December 31, 2023 to RMB309.6 million as of December 31, 2024, primarily due to regular
depreciation and impairment on buildings. Our property, plant and equipment remained relatively
stable at RMB309.6 million as of December 31, 2024 and RMB297.3 million as of June 30, 2025.
Right-of-use Assets
Our right-of-use assets primarily consisted of leasehold land and leasehold buildings. Our
right-of-use assets amounted to RMB44.5 million, RMB42.7 million, RMB41.1 million and
RMB43.0 million, as of December 31, 2022, 2023, 2024 and June 30, 2025, respectively. The
fluctuations in right-of-use assets primarily reflect regular depreciation and the renewal of our
lease agreements.
Deferred Tax Assets
Our deferred tax assets primarily consisted of lease liability, unrealized intercompany profits,
impairment allowance, provision, tax losses, deferred income and ROU asset. Our deferred tax
assets increased from RMB117.3 million as of December 31, 2022 to RMB152.3 million as of
December 31, 2023 and further increased to RMB180.7 million as of December 31, 2024 and
increased to RMB205.4 million as of June 30, 2025, primarily due to increases in impairment
allowances and tax losses.
Prepayments and Other Receivables, Non-current Portion
Our non-current prepayments and other receivables consisted of (i) prepayment for
acquisition of property, plant and equipment, and (ii) loans to a third party. Our non-current
prepayments and other receivables amounted to RMB3.9 million, RMB17.5 million, RMB10.5
million and RMB11.2 million as of December 31, 2022, 2023, 2024 and June 30, 2025,
respectively. The increase from 2022 to 2023 was primarily due to (i) an increase in prepayment
for acquisition of property, plant and equipment in relation to our industrial park, and (ii) the loans
to a third party of RMB6.8 million incurred in 2023 in relation to our loans to Customer K, which
did not occur in 2022. The decrease from 2023 to 2024 was primarily due to the re-classification
of such loans from non-current other receivables to current other receivables based on the
FINANCIAL INFORMATION
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--- page 432 ---
remaining term to maturity. See Note 24 to the Accountant’s Report in Appendix I to this
prospectus. Our non-current prepayments and other receivables remained relatively stable at
RMB10.5 million as of December 31, 2024 and RMB11.2 million as of June 30, 2025.
Trade Receivables, Non-current Portion
Our non-current trade receivables primarily consist of our trade receivables due in more than
one year. We did not record any non-current trade receivables as of December 31, 2022, 2023, or
2024. As of June 30, 2025, we recorded RMB39.9 million in non-current trade receivables, which
related to Customer M under our autonomous mining products and solutions. To facilitate our
market expansion while addressing the substantial upfront costs typically associated with
autonomous mining products and solutions projects, we have agreed with Customer M on a
24-month installment payment arrangement. According to CIC, the aforementioned payment
arrangement is not unusual in the industry.
We believe that there is no recoverability issue for our non-current trade receivables on the
basis that (i) Customer M is a well-established company in the mining engineering industry with a
strong credit reputation, (ii) as of June 30, 2025, Customer M has consistently made payments in
accordance with the contractual schedule, and (iii) we have made sufficient provision for trade
receivables.
Trade Payables, Non-current Portion
Our non-current trade payables primarily consist of our trade payables due in more than one
year. We did not record any non-current trade payables as of December 31, 2022, 2023, and 2024.
As of June 30, 2025, we recorded RMB20.3 million in non-current trade payables, which related to
our procurement of mining trucks for the project we cooperated with Supplier L.
FINANCIAL INFORMATION
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Net Current Assets/(Liabilities)
The following table sets forth our current assets and liabilities as of the dates indicated:
As of December 31,
As of
June 30,
As of
October 31,
2022 2023 2024 2025 2025
(RMB in thousands)
(unaudited)
Current assets
Inventories ..................... 123,465 174,227 96,544 170,521 150,313
Trade and notes receivables ......... 30,772 58,680 137,360 417,946 450,154
Prepayments and other receivables ..... 56,082 90,426 117,920 160,724 149,782
Contract assets .................. 2,887 9,834 12,251 20,286 22,489
Financial assets at FVTPL .......... 30,130 — 10,005 — —
Financial assets at FVTOCI ......... 395 9,799 290 18,543 7,687
Income tax recoverable ............ 3 458 454 498 498
Restricted bank deposits ............ 27,806 27,819 10,481 22,105 25,387
Term Deposits .................. — 147,411 5,328 5,402 5,402
Cash and cash equivalents .......... 381,678 234,663 306,402 186,225 101,109
Total current assets ............. 653,218 753,317 697,035 1,002,250 912,821
Current liabilities
Trade and notes payables ........... 41,530 70,689 63,299 377,708 335,795
Contract liabilities ................ 46,757 86,124 42,011 49,314 70,888
Borrowings .................... 44,606 123,834 153,842 230,884 237,079
Lease liabilities .................. 4,566 2,980 3,661 5,937 5,480
Other payables and accruals ......... 76,728 106,465 101,707 133,831 128,824
Income tax payables .............. — 9 2——
Provisions ..................... 1,938 4,743 17,735 35,217 37,380
Financial instruments with preferred
rights at amortised cost ........... — — — 1,962,541 2,009,230
Total current liabilities ............ 216,125 394,844 382,257 2,795,432 2,842,676
Net current assets/(liabilities) ....... 437,093 358,473 314,778 (1,793,182) (1,911,855)
Our net current assets decreased from RMB437.1 million as of December 31, 2022 to
RMB358.5 million as of December 31, 2023, primarily due to (i) a decrease in cash and cash
equivalents, (ii) an increase in borrowings, and (iii) an increase in contract liabilities, partially
offset by an increase in prepayments and other receivables.
FINANCIAL INFORMATION
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Our net current assets decreased from RMB358.5 million as of December 31, 2023 to
RMB314.8 million as of December 31, 2024, primarily due to (i) a decrease in term deposits as a
result of the maturity of significant term deposits within 2024, and (ii) a decrease in inventory
resulting from the re-classification from contract costs in progress into cost of sales, partially
offset by (i) an increase in cash and cash equivalents, and (ii) a decrease in contract liabilities.
We recorded net current liabilities of RMB1,793.2 million as of June 30, 2025 compared with
net current assets of RMB314.8 million as of December 31, 2024, primarily due to (i) the
reclassification of financial instruments with preferred rights at amortised cost of RMB1,962.5
million from non-current liabilities to current liabilities in relation to our Series A financing to
Series C+ financing, (ii) a decrease in cash and cash equivalents, and (iii) increases in trade and
notes payables and borrowings, partially offset by an increase in trade and notes receivables. The
increases in trade and notes receivables and trade and notes payables reflect the growth of our
business. We expect to turn into net current asset position upon Listing, taking into account the
re-designation of the financial instruments with preferred rights at amortized cost with carrying
amount of RMB1,962.5 million as of June 30, 2025 from net current liabilities to equity as a result
of the automatic conversion into ordinary Shares.
To further improve our financial position, (i) we plan to enhance our working capital
management efficiency, improve the management of trade receivables and strengthen our efforts in
trade receivable collection, (ii) we expect to enhance our bargaining power over our suppliers as
we scale up our business, and we plan to negotiate better credit terms with our suppliers for
extended payment cycles, and (iii) we plan to continue strengthening our safety inventory
management and enhancing inventory turnover efficiency. During the Track Record Period, our
inventory turnover days have consistently declined, demonstrating ongoing improvements in
operational performance. We also expect to be able to benefit from economics of scale as we scale
up, and will consider broadening our sources of financing after the Listing, which will further
improve our working capital sufficiency and financial position.
FINANCIAL INFORMATION
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Inventories
Our inventories primarily consisted of contract costs in progress, raw materials, finished
goods and consigned-processing-material. The following table sets out a breakdown of our
inventories as of the dates indicated:
As of December 31, As of June 30,
2022 2023 2024 2025
(RMB in thousands)
Contract costs in progress (1) ........ 88,364 151,691 55,196 124,402
Raw material .................... 35,146 31,526 41,027 45,775
Finished goods .................. 6,228 6,885 7,936 7,982
Consigned-processing-material ...... 966 3,104 58 53
Less: provision .................. 7,239 18,979 7,673 7,691
Total .......................... 123,465 174,227 96,544 170,521
Note:
(1) Contract costs in progress mainly include the direct materials, employee costs and manufacturing costs to be
consumed in the process of service rendering related to the sales contracts.
Our inventories increased by 41.1% from RMB123.5 million as of December 31, 2022 to
RMB174.2 million as of December 31, 2023, primarily due to an increase in contract costs in
progress resulting from an increase in the number of ongoing orders during the same period. Our
inventories decreased by 44.6% from RMB174.2 million as of December 31, 2023 to RMB96.5
million as of December 31, 2024, primarily due to the re-classification from contract costs in
progress into cost of sales along with the eventual project acceptance, in particular, certain V2X
projects, during the same period. Our inventories increased from RMB96.5 million as of December
31, 2024 to RMB170.5 million as of June 30, 2025, primarily due to an increase in contract costs
in progress resulting from an increase in the number of ongoing orders and larger order sizes for
autonomous mining products and solutions.
FINANCIAL INFORMATION
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The following table sets forth our inventory turnover days for the periods indicated:
Y ear ended December 31,
Six months
ended
June 30,
2022 2023 2024 2025
Inventory turnover days (1) .......... 988.5 513.6 160.1 71.0
Note:
(1) Inventory turnover days are calculated using the average of opening balance and closing balance of inventories for
a year divided by cost of sales for the relevant year/period and multiplied by 365/180 days.
We recorded relatively higher inventory turnover days in 2022, primarily due to the extension
of acceptance period in relation to certain V2X projects in 2022, leading to increased contract
costs in progress rather than cost of sales, and the correspondent delay in revenue recognition
further brought down the revenue during that year. Being in the early stage of our
commercialization, our inventory was more sensitive to fluctuations in the project acceptance
period. Our inventory turnover days decreased from 988.5 days in 2022 to 513.6 days in 2023,
primarily due to project acceptance of the aforementioned V2X projects. Our inventory turnover
days further decreased from 513.6 days in 2023 to 160.1 days in 2024, primarily due to
improvements in our inventory management. Our inventories turnover days decreased from 160.1
days in 2024 to 71.0 days in the six months ended June 30, 2025, primarily due to improvements
in our inventory management and increased sales of our autonomous mining products and
solutions.
The following table sets forth an aging analysis of our inventories as of the dates indicated:
As of December 31, As of June 30,
2022 2023 2024 2025
(RMB in thousands)
Within one year .................. 99,029 126,605 86,014 141,973
Over one year but less than
two years ..................... 27,393 50,354 5,812 24,852
Over two years but less than
three years .................... 2,700 14,352 4,374 2,053
Over three years ................. 1,582 1,895 8,017 9,334
Total .......................... 130,704 193,206 104,217 178,212
FINANCIAL INFORMATION
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We believe we have a comprehensive and adequate system in place for identifying and
accounting for inventory risks and impairment provisions. We regularly review our inventories and
recoverability to identify items with low sales or usage value and make impairment provisions
accordingly. Inventories are stated at the lower of cost and net realizable value. Cost mainly
comprises contract costs in progress, raw materials, consigned-processing-material and finished
goods. Costs of purchased inventories are determined after deducting rebates and discounts. Net
realizable value is the estimated selling price in the ordinary course of business less the estimated
costs of completion and the estimated costs necessary to make the sale. We assess impairment to
inventories from time to time during the Track Record Period and may make provision to write
down our inventories to the net realizable value if the inventories become expired or damaged, or
their prices went down, and their net realizable value substantially decreases.
Our inventories are primarily aged one year or less. As of June 30, 2025, our inventories
aged over three years primarily consist of raw materials for autonomous logistics truck solution,
with a balance of approximately RMB9.3 million, including vehicle computers and chips. We have
been closely monitoring the recoverability of these inventories. Considering the market demand,
maintainability and adaptability of the aforementioned raw materials, supply chain stability, and
our strategic business planning, we believe there are no material recoverability issues for these raw
materials. However, in accordance with the principle of prudence, we conducted a comprehensive
impairment assessment and recognized sufficient impairment provision for the inventories aged
over three years with total impairment charge of RMB6.6 million to ensure the financial statements
reflect our economic value accurately.
Taking into account (i) our anticipation of the market demand, (ii) our continuous efforts in
supply chain management and sales plans, (iii) inventories aged over one year mainly include
contract costs in progress and finished goods, which have no validity period, (iv) as of June 30,
2025, we have not identified any material projects fail to be accepted, and (v) our inventory
turnover days showed a declining trend during the Track Record Period, our Directors are of the
view that we have made sufficient impairment provision for inventories during the Track Record
Period and we did not identify any recoverability issue for our inventories.
As of September 30, 2025, RMB73.9 million, or 41.5% of our inventories as of June 30,
2025, had been consumed or sold.
FINANCIAL INFORMATION
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Trade and Notes Receivables, Current Portion
Our trade and notes receivables primarily represent receivables in relation to our autonomous
driving, V2X and intelligent perception solutions. The following table sets forth a breakdown of
our trade and notes receivables as of the dates indicated:
As of December 31,
As of
June 30,
2022 2023 2024 2025
(RMB in thousands)
Trade receivables ................ 34,464 52,880 148,831 402,742
Notes receivables ................ 3,114 8,475 6,754 57,724
Less: provision for impairment ...... 6,806 2,675 18,225 42,520
Total .......................... 30,772 58,680 137,360 417,946
Our trade and notes receivables increased significantly from RMB30.8 million as of
December 31, 2022 to RMB58.7 million as of December 31, 2023 and further increased to
RMB137.4 million as of December 31, 2024, primarily due to an increase in our sales in
intelligent driving and project acceptance of certain V2X projects during the same period. Our
trade and notes receivables increased from RMB137.4 million as of December 31, 2024 to
RMB417.9 million as of June 30, 2025, primarily due to (i) an increase in sales of autonomous
mining products and solutions, mainly reflecting the concentrated revenue recognition from three
large-scale autonomous mining truck projects involving Customers M, N and O in the second
quarter of 2025, with trade receivables amounting to RMB151.0 million, RMB85.4 million, and
RMB40.1 million, respectively, and (ii) the 24-month credit term and monthly installment payment
arrangement with Customer M and Customer P.
The following table sets out an aging analysis of our trade receivables as of the dates
indicated:
As of December 31,
As of
June 30,
2022 2023 2024 2025
(RMB in thousands)
Up to three months ............... 29,863 34,825 66,076 321,650
Three to six months .............. 6 2,014 18,726 2,833
Six to nine months ............... 431 6,530 28,271 37,850
Nine to 12 months ................ 82 1,632 1,424 17,334
Over 12 months .................. 4,082 7,879 34,334 64,752
Total .......................... 34,464 52,880 148,831 444,419
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The following table set forth the maturity profile of receivables in the respect of Customer K
and Customer L.
Customers Receivables from
Receivables amount as
of June 30, 2025
Maturity profile
as of June 30, 2025
(RMB in thousands)
Customer K ..... Purchase agreement with us 1,200 Overdue for more than nine
months but less than twelve
months
Deposit agreement with us 15,200 RMB5.0 million overdue for
less than three months
RMB10.2 million not yet due,
including RMB5.0 million
due on September 30, 2025
and RMB5.2 million due on
December 31, 2025.
Loan agreement with us 13,110 Not yet due (due on December
31, 2025)
Customer L ..... Purchase agreement with us 28,544 RMB14.8 million overdue for
more than twelve months;
RMB13.7 million not yet
due (maturity date to be
determined by the project
progress)
We typically set forth the trading terms with our customers in the relevant sales contracts.
During the Track Record Period, we usually grant our customers credit terms of up to 180 days.
For certain projects, we have provided longer credit terms or installment-based payment
arrangements for certain key customers. We seek to maintain strict control over our outstanding
receivables. Our finance and risk control departments are responsible for minimizing credit risks.
Overdue balances are reviewed regularly by senior management. To manage risks associated with
trade receivables, we maintain frequent communications with our customers to ensure effective
credit control. We believe that the credit risk inherent in our outstanding trade receivable balances
is low.
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The following table sets forth our trade receivables turnover days for the years indicated:
Y ear ended December 31,
Six months
ended
June 30,
2022 2023 2024 2025
Trade receivables turnover days (1) .... 244.9 120.2 89.8 121.7
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 365/180 days. Given the non-current trade receivables of RMB39.9 million recorded as of June
30, 2025, the trade receivables turnover days (including the balance of non-current trade receivables as of June 30,
2025) in the six months ended June 30, 2025 is 130.9 days.
Our trade receivables turnover days decreased from 244.9 days in 2022 to 120.2 days in
2023, primarily due to (i) the relatively longer trade receivables turnover days in 2022, which were
mainly driven by the project acceptance and revenue recognition of the Jurong project in
December 2022, resulting in a relatively higher ending balance of our trade receivables in the same
year, while the total revenue in 2022 was relatively lower, and our enhanced efforts in receivables
management. Our trade receivables turnover days further decreased to 89.8 days in 2024, primarily
due to the growth of our business scale and our enhanced efforts in receivables management. Our
trade receivables turnover days increased from 89.8 days in 2024 to 121.7 days in the six months
ended June 30, 2025, primarily due to a higher proportion of trade receivables recognized during
the period that remained within their agreed payment terms.
As of September 30, 2025, RMB23.4 million, or 5.3% of our trade receivables as of June 30,
2025, had been settled. As of the same date, RMB20.2 million, or 16.9% of our trade receivables
aged over six months and RMB0.6 million, or 0.9% of our trade receivables aged over one year as
of June 30, 2025, had been settled. As of the Latest Practicable Date, Customer L has settled
RMB3.0 million, representing approximately 10.5% of its trade receivables as of June 30, 2025,
while none of the trade receivables from Customer F have been settled.
We apply the IFRS 9 simplified approach to measure expected credit losses which uses a
lifetime expected loss allowance for all trade receivables and contract assets. To measure the
expected credit losses, trade receivables and contract assets have been grouped based on shared
credit risk characteristics and aging. The expected loss rates are based on the credit rating of
counter parties and the payment profiles of sales over a period of each reporting period and
probability of default of counter parties on an ongoing basis throughout each reporting period. The
historical loss rates are adjusted to reflect current and forward-looking information on
macroeconomic factors affecting the ability of the customers to settle the receivables. We have
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identified the Gross Domestic Product (“ GDP”) and the growth rate of information technology
industry to be the most relevant factor in Mainland China in the credit risk assessment, and
accordingly adjust the historical loss rates based on expected changes in these factors. See Note 3
to the Accountant’s Report in Appendix I to this prospectus.
Our Directors believe there is no recoverability issue for our trade receivables, including
those aged over six months and over one year, primarily because: (i) we assess our customers’
credit quality carefully and regularly, taking into account their business background, the general
risks associated with their industries, their financial position, past experience and other factors; (ii)
we did not experience any recoverability issues for our trade receivables throughout the Track
Record Period because our trade receivables are mainly due from customers with good credit
profiles and no history of material defaults on their payment obligations was noted in the past; (iii)
our trade receivables over six months increased from RMB4.6 million as of December 31, 2022 to
RMB16.0 million as of December 31, 2023, primarily due to (a) the lengthy internal settlement
processes of our major customers, who are leading industry players with good credit, and (b) the
extended payment processes of our certain customers’ end customers. These factors do not indicate
any systematic recoverability issues; (iv) our trade receivables over six months further increased
from RMB16.0 million as of December 31, 2023 to RMB64.0 million as of December 31, 2024,
primarily due to increased trade receivables from Customer L, an SOE customer, in relation to our
Chongqing V2X Project, for which revenue and corresponding trade receivables were only
recognized after customer acceptance in May 2024; (v) our trade receivables over six months but
within one year increased from RMB29.7 million as of December 31, 2024 to RMB55.2 million as
of June 30, 2025, primarily due to (a) an increase from Customer A’s trade receivables, which was
settled as of September 30, 2025, and (b) the extended payment processes of Customer F’s end
customers, which does not indicate any systematic recoverability issues; (vi) our trade receivables
over one year increased from RMB7.9 million as of December 31, 2023 to RMB34.3 million as of
December 31, 2024, primarily due to the aforementioned reason in relation to Customer F. This
factor does not indicate any systematic recoverability issues; (vii) our trade receivables over one
year increased from RMB34.3 million as of December 31, 2024 to RMB64.8 million as of June 30,
2025, primarily because Customer L, as an SOE customer, has a long payment cycle as required by
their internal financial management and payment approval processes; (viii) we have dedicated
internal teams which are responsible for close and regular monitoring of the credit profiles,
operating and financial conditions of our customers and taking appropriate proactive follow-up
actions to ensure the customers’ payments are made as scheduled; (ix) we also closely monitor the
recoverability status of trade receivables, especially for those long-aging trade receivables, and
enhance our collection efforts as appropriate; and (x) we have made sufficient provision for trade
receivables.
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As of June 30, 2025, our trade receivables from Customer L amounted to RMB28.5 million,
and we believe there is no recoverability issue for the outstanding trade receivables, primarily
because: (i) Customer L, as as an SOE customer, has a long payment cycle as required by their
internal financial management and payment approval processes; and (ii) we have maintained
ongoing communication with Customer L regarding the payment schedule, and as of the Latest
Practicable Date, Customer L has agreed to settle approximately RMB7.0 million of the
outstanding balance through two separate installments scheduled for December 2025 and January
2026; nevertheless, as a prudent measure, we have made provision of impairment of RMB9.2
million, representing 32.4% of the outstanding trade receivables from Customer L as of June 30,
2025.
Prepayments and Other Receivables, Current Portion
Our prepayments and other receivables primarily consisted of (i) prepayments made to the
third-party suppliers, (ii) prepayments made on behalf of customers, (iii) value-added tax
recoverable, and (iv) deposits. The following table sets out a breakdown of our prepayments and
other receivables as of the dates indicated:
As of December 31, As of June 30,
2022 2023 2024 2025
(RMB in thousands)
Prepayments made to the third party
suppliers ..................... 9,321 16,145 35,402 86,928
Prepayment made to the related-party
suppliers ..................... ——— 2 3 5
Prepayments for listing expenses .... — — 2,689 1,223
Prepayments made to the ultimate
holding company of the Company .. 3,660 660 — —
Deferred listing expenses .......... — — 2,049 3,637
Value-added tax recoverable ........ 28,835 31,471 29,051 30,648
Deposits ....................... 4,767 9,765 27,338 26,843
Payments made on behalf of
customers ..................... 8,696 27,849 14,175 15,136
Loan to a third party .............. — 3,075 12,875 13,110
Loans to employees .............. 822 1,966 2,030 2,059
Amount due from the employee ..... 179 43 71 1,461
Amount due from the third party ..... 77 29 25 25
56,357 91,003 125,705 181,305
Less: provision for impairment ...... (275) (577) (7,785) (20,581)
Total ......................... 56,082 90,426 117,920 160,724
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Our prepayments and other receivables increased by 61.1% from RMB56.1 million as of
December 31, 2022 to RMB90.4 million as of December 31, 2023, primarily due to (i) an increase
in payments on behalf of customers in relation to receivables arising from the request from one of
our V2X customers to purchase certain products on their behalf, (ii) an increase in value-added tax
recoverable, and (iii) an increase in prepayments made to the third party suppliers in relation to
payment for mining trucks. Our prepayments and other receivables increased from RMB90.4
million as of December 31, 2023 to RMB117.9 million as of December 31, 2024 primarily due to
the combined effect of (i) an increase in deposits, reflecting our expanded business scale and the
deposit of RMB15.2 million incurred in relation to Customer K, (ii) an increase in prepayments
made to the third party suppliers in relation to payment for mining trucks, and (iii) a decrease in
payments made on behalf of customers, primarily due to the fulfillment of their payment
obligations. Our prepayments and other receivables increased by 36.3% from RMB117.9 million as
of December 31, 2024 to RMB160.7 million as of June 30, 2025, primarily due to increased
prepayments made to the third party suppliers in relation to our autonomous mining products and
solutions.
Our payments made on behalf of customers mainly represent payments made by us at the
request of our certain V2X customers and one autonomous driving customer for the purchase of
certain project related ancillary products and services from third-party suppliers on their behalf,
primarily including software development services and autonomous driving related hardware. Our
payments on behalf of customers were aimed at providing administrative convenience for the end
customers and reducing their communication costs with multiple suppliers. According to CIC, such
arrangements is in line with industry norm. Such payments are generally settled in a lump sum
upon acceptance of the relevant project by the customer or in installments during the
implementation of the relevant project, which are subject to our customers’ receipt of payment
from their end-customers. See “Business — Customers — Autonomous Driving” and “Business —
Customers — V2X Products and Solutions.”
The following table sets forth an aging analysis of our payments made on behalf of customers
that are yet to be settled as of the dates indicated:
As of December 31, As of June 30,
2022 2023 2024 2025
(RMB in thousands)
Within one year ................. 8,676 26,268 4,941 5,563
Over one year but less than two years 20 1,561 7,973 8,593
Over two years but less than three
years ....................... — 20 1,261 960
Over three years but less than four
years ........................ ———2 0
Total ......................... 8,696 27,849 14,175 15,136
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Our outstanding payments made on behalf of customers over one year increased from
RMB1.6 million in 2023 to RMB9.2 million in 2024, mainly in relation to payments made on
behalf of Customer G and in line with aging trend of our trade receivables from Customer G.
Following the acceptance of our projects by Customer G in February and December 2023, the
majority of our trade receivables from, and payments made on behalf of, Customer G, have been
settled as of June 30, 2025 with the remaining amounts in the process of being settled.
As of December 31, 2022, 2023, 2024 and June 30, 2025, we recorded loans to employees of
RMB0.8 million, RMB2.0 million, RMB2.0 million and RMB2.1 million, respectively, because we
provided loans to certain core employees for the purpose of purchasing properties as part of our
employee incentive program. In the loan agreements we entered into with these core employees,
we clearly specify the loan amount and purpose as well as repayment method.
As of December 31, 2023, 2024 and June 30, 2025, we recorded current loans to a third party
of RMB3.1 million, RMB12.9 million and RMB13.1 million, respectively, because we provided
loans to Customer K, our largest customer in 2024, to facilitate the commercialization of our first
large-scale autonomous mining project in Northwest China. See “Business — Our Offerings —
Our Major Projects” for details of this project. In August 2024, we and Customer K entered into a
supplementary agreement, the total principal amounts of RMB12.4 million will be repayable in
December 2025 with the interests. See “Business — Customers — Major Customers.” In the loan
agreements we entered into with it, we clearly specify the loan amount, interest rate and purpose
as well as repayment method. We are entitled to monitor the use of the loan and assess its
repayment capacity. If the loan is not used in accordance with the agreement, we are entitled to
recall the entire loan and impose penalty interest. We also entered into a guarantee agreement with
Customer K’s legal representative, who was also the project manager for Customer K, requiring
the representative to assume joint and several liability as guarantor of the loan agreement. As
advised by our PRC Legal Advisor, the loans granted by us to our employees and a third party was
in compliance with relevant PRC laws and regulations. As of the Latest Practicable Date, we were
not been subject to administrative or criminal penalties by the relevant regulatory bodies for such
loan arrangements, or were filed for investigation for violating the relevant laws and regulations
on private lending.
As of June 30, 2025, our prepayments and other receivables, including deposit and loans to
third party, from Customer K amounted to RMB28.3 million, and our trade receivables from
Customer K amounted to RMB1.2 million as of the same date. Although Customer K has default
under its finance lease arrangement, we cannot currently conclude that there is a recoverability
issue with the aforementioned receivables, as (i) the operation and production of Customer K’s
autonomous mining project on its existing mining faces continued as of the Latest Practicable
Date, (ii) the loan of RMB13.1 million and deposit of RMB5.2 million have not yet reached their
maturity date of December 31, 2025, and (iii) we are actively pursuing collection and maintaining
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communication with Customer K regarding the overdue trade receivables of RMB1.2 million and
deposit of RMB5.0 million as of June 30, 2025; nevertheless, as a prudent measure, we have made
impairment provisions of RMB20.2 million for trade receivables and prepayments and other
receivables from Customer K as of June 30, 2025, representing 68.3% of the outstanding amounts
as of June 30, 2025.
As of September 30, 2025, RMB11.5 million, or 6.0% of our prepayments and other
receivables as of June 30, 2024, had been settled.
Trade and Notes Payables, Current Portion
Our trade and notes payables primarily consisted of notes payables and trade payables,
mainly representing our obligation to pay for goods or services that have been purchased from
suppliers in the ordinary course of business. During the Track Record Period, our suppliers
generally granted us credit periods of up to 90 days. For certain projects, we have negotiated
extended credit terms or installment-based payment arrangements with suppliers to match the
payment arrangements agreed upon with our customers. The following table sets out a breakdown
of our trade and note payables as of the dates indicated:
As of December 31, As of June 30,
2022 2023 2024 2025
(RMB in thousands)
Notes payables .................. 2,256 29,600 — 12,092
Trade payables .................. 39,274 41,089 63,299 365,616
Total .......................... 41,530 70,689 63,299 377,708
Our trade and notes payables increased from RMB41.5 million as of December 31, 2022 to
RMB70.7 million as of December 31, 2023, primarily due to an increase in our procurement as we
expanded our business and production scale. Our trade and notes payables decreased by 10.5%
from RMB70.7 million as of December 31, 2023 to RMB63.3 million as of December 31, 2024,
primarily due to the maturity of significant notes payable within 2024, partially off set by an
increase in trade payables reflecting our business growth. Our trade and notes payables
significantly increased from RMB63.3 million as of December 31, 2024 to RMB377.7 million as
of June 30, 2025, primarily due to (i) an increase in our procurement of mining trucks from
Supplier F and L, with trade payable amounting to approximately RMB164.8 million and
RMB98.9 million, respectively, as we expanded our business scale and supported the
aforementioned three large-scale autonomous mining truck projects, (ii) the collection progress of
FINANCIAL INFORMATION
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receivables from these three projects as payments to suppliers are generally made after the
corresponding customer payments have been received, and (iii) the 18-month credit term and
monthly installment payment arrangement with Supplier L.
The following table sets out an aging analysis of our trade payables as of the dates indicated:
As of December 31, As of June 30,
2022 2023 2024 2025
(RMB in thousands)
Up to six months ................. 27,935 23,526 32,411 342,907
Six to 12 months ................. 3,094 7,278 17,336 14,549
Over 12 months .................. 8,245 10,285 13,552 28,411
Total .......................... 39,274 41,089 63,299 385,867
The following table set forth the maturity profile of payables in the respect of Customer K
and Customer L.
Customers related Payables from
Payables amount as
of June 30, 2025
Maturity profile
as of June 30, 2025
(RMB in thousands)
Customer K related .. Contract between us and the Supplier H
for mining trucks, which were
subsequently provided to Customer K
13,048 Overdue for more
than 12 months
Contracts with suppliers to procure
products or services for the
METAMINE solution, which were
subsequently provided to Customer K
N/A
(1) N/A(1)
Customer L related .. Contracts with suppliers to procure
products or services for V2X, which
were subsequently provided to
Customer L
N/A
(1) N/A(1)
Note:
(1) The suppliers involved in the contracts with us to procure products or services for Customer K or Customer L are
numerous and scattered, and these procurements are not directly linked to specific sales orders. Therefore the
aggregate payable amount cannot be quantified. Accordingly, the maturity profile of the payables involved as of the
Latest Practicable Date cannot be determined.
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The following table sets forth our trade payables turnover days for the Track Record Period:
Y ear ended December 31,
Six months
ended
June 30,
2022 2023 2024 2025
Trade payables turnover days (1) ...... 300.4 138.6 61.7 114.1
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 365/180
days. Given the non-current trade payables of RMB20.3 million as of June 30, 2025, the trade payables turnover
days (including the balance of non-current trade payables as of June 30, 2025) in the six months ended June 30,
2025 is 119.5 days.
Our trade payables turnover days decreased from 300.4 days in 2022 to 138.6 days in 2023
and further decreased to 61.7 days in 2024, primarily due to the settlement of certain major
projects in the respective period, leading to a decreased balance of trade payables. Our trade
payables turnover days increased from 61.7 days in 2024 to 114.1 days in the six months ended
June 30, 2025, primarily due to extended credit terms granted by certain suppliers following the
expansion of our business.
As of September 30, 2025, RMB102.7 million, or 26.6% of our trade payables as of June 30,
2025, had been settled.
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Other Payables and Accruals
Our other payables and accruals primarily consisted of (i) payables for purchases of PPE, (ii)
other tax payables, (iii) payroll and welfare payables, (iv) other payable arising from the
transaction of ancillary services, and (v) accrued listing expenses. The following table sets out a
breakdown of our other payables and accruals as of the dates indicated:
As of December 31, As of June 30,
2022 2023 2024 2025
(RMB in thousands)
Payables for purchases of PPE ...... 40,168 38,755 39,986 39,106
Payroll and welfare payables ........ 30,384 25,370 27,030 14,311
Other payable arising from the
transaction of ancillary services .... 419 34,523 11,837 13,633
Financial guarantee contracts liability . — 186 6,452 50,515
Amount due to third parties ........ 500 3,562 6,111 501
Other taxes payable .............. 1,791 264 3,689 1,957
Accrued listing expenses ........... — — 3,941 11,676
Accruals ....................... 1,008 2,379 2,661 2,132
Repayable government grants ....... 2 , 3 6 0———
Payables for purchases of intangible
assets ....................... 9 8———
Transaction costs payable .......... — 1 , 4 2 6——
Total .......................... 76,728 106,465 101,707 133,831
Our other payables and accruals increased by 38.8% from RMB76.7 million as of December
31, 2022 to RMB106.5 million as of December 31, 2023, primarily due to an increase in other
payable arising from the business of V2X products and solutions in response to the request from
one of our V2X customers to purchase certain products on their behalf. Our other payables and
accruals decreased by 4.5% from RMB106.5 million as of December 31, 2023 to RMB101.7
million as of December 31, 2024, primarily due to a decrease in other payable arising from the
business of V2X products and solutions resulting from our settlements to aforementioned amount
in 2024, partially offset by an increase in financial guarantee contracts liability in relation to our
finance lease arrangement in the same period. Our other payables and accruals increased by 31.6%
from RMB101.7 million as of December 31, 2024 to RMB133.8 million as of June 30, 2025,
primarily due to (i) an increase in financial guarantee contracts liability arising from Customer K’s
default under its finance lease agreement, and (ii) an increase in accrued listing expenses, partially
offset by a decrease in payroll and welfare payables following the payment of bonuses for the
previous year. See “Business — Customers — Major Customers — Transactions with Customer
K.”
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As of September 30, 2025, RMB9.7 million, or 10.7% of our other payables and accruals as
of June 30, 2025, had been settled.
Contract Liabilities
Our contract liabilities primarily represented advance payments from our customers for
products that have not yet been provided to such customers. Our contract liabilities increased from
RMB46.8 million as of December 31, 2022 to RMB86.1 million as of December 31, 2023,
primarily due to an increase in advance payments from our customers as a result of the increase in
our sales of autonomous driving and V2X during the same period. Our contract liabilities
decreased from RMB86.1 million as of December 31, 2023 to RMB42.0 million as of December
31, 2024, primarily due to part of contract liabilities as of December 31, 2023 was recognized as
revenue in 2024. Our contract liabilities increased from RMB42.0 million as of December 31,
2024 to RMB49.3 million as of June 30, 2025, primarily due to an increase in advance payments
from our customers as a results of the increase in our sales of intelligent driving during the same
period.
As of September 30, 2025, RMB3.6 million, or 7.4% of our contract liabilities as of June 30,
2025 had been settled.
Provision
Our provision represents warranties from sales of our products and solutions. Our provision
increased from RMB1.9 million as of December 31, 2022 to RMB4.7 million as of December 31,
2023 and further increased to RMB17.7 million as of December 31, 2024, primarily as a result of
the increased completion of acceptance on METAMINE solution and V2X projects in 2023 and
2024. Our provision increased from RMB17.7 million as of December 31, 2024 to RMB35.2
million as of June 30, 2025, primarily due to the increased completion of acceptance on
METAMINE solution.
LIQUIDITY AND CAPITAL RESOURCES
We have historically funded our cash requirements principally from proceeds from our
business operations, bank borrowings and capital contribution from shareholders. 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.
FINANCIAL INFORMATION
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Cash Flow
The following table sets forth a summary of our cash flows for the periods indicated:
Y ear ended December 31,
Six months ended
June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
Operating cash flows before movements
in working capital .............. (167,826) (136,889) (89,004) (45,291) (39,520)
Change in working capital .......... (35,227) (59,417) (58,705) (2,819) 168,688
Income taxes paid ............... — (455) (26) (9) (2)
Net cash used in operating activities .. (203,053) (196,761) (147,735) (42,481) (208,210)
Net cash generated from/(used in)
investing activities ............. (302,384) 58,972 125,122 104,878 7,654
Net cash generated from/(used in)
financing activities ............. 386,326 (9,226) 94,325 34,919 80,401
Cash and cash equivalents at beginning
of year/period ................. 500,789 381,678 234,663 234,663 306,402
Cash and cash equivalents at end of
year/period .................. 381,678 234,663 306,402 331,979 186,225
Net Cash Flows Used in Operating Activities
In the six months ended June 30, 2025, we had net cash used in operating activities of
RMB208.2 million, which represents our loss before income tax of RMB479.8 million, as adjusted
by (i) non-cash and non-operating items, primarily comprising of (a) share-based payment
expenses of RMB266.6 million, and (b) finance costs of RMB73.5 million, and (ii) changes in
working capital, primarily comprising increase in trade and notes receivables and other receivables
and prepayments and financial assets at FVTOCI of RMB420.3 million, partially offset by increase
in trade and notes payables and other payables of 340.0 million.
In 2024, we had net cash used in operating activities of RMB147.7 million, which represents
our loss before income tax of RMB609.2 million, as adjusted by (i) non-cash and non-operating
items, primarily comprising of (a) share-based payment expenses of RMB319.9 million, and (b)
finance costs of RMB135.7 million, and (ii) changes in working capital, primarily comprising of
(a) increase in trade and notes receivables and other receivables and prepayments and financial
assets at FVTOCI of RMB109.9 million, and (b) decrease in contract liabilities of RMB44.1
million, partially offset by decrease in inventories.
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In 2023, we had net cash used in operating activities of RMB196.8 million, which represents
our loss before income tax of RMB290.1 million, as adjusted by (i) non-cash and non-operating
items, primarily comprising of (a) finance costs of RMB121.1 million, and (b) depreciation of
property, plant and equipment of RMB21.5 million, and (ii) changes in working capital, primarily
comprising of (a) increase in trade and notes receivables and other receivables and financial assets
at FVTOCI of RMB63.4 million, and (b) increase in inventories of RMB62.6 million, partially
offset by (a) increase in trade and notes payables and other payables of RMB61.2 million, and (b)
increase in contract liabilities of RMB39.4 million.
In 2022, we had net cash used in operating activities of RMB203.1 million, which represents
our loss before income tax of RMB302.9 million, as adjusted by (i) non-cash and non-operating
items, primarily comprising of (a) finance costs of RMB105.6 million and (b) depreciation of
property, plant and equipment of RMB16.7 million, and (ii) changes in working capital, primarily
comprising of (a) increase in inventories of RMB51.5 million, and (b) increase in trade and notes
receivables and other receivables and prepayments and financial assets at FVTOCI of RMB35.5
million, partially offset by increase in contract liabilities of RMB28.6 million
Our net cash used in operating activities decreased from RMB203.1 million in 2022 to
RMB196.8 million in 2023, and further decreased to RMB147.7 million in 2024. Despite these net
operating cash outflows during the Track Record Period, we expect improving our cash position
primarily through:
 continuously increasing revenue by (a) investing in our technologies and expanding our
product and solution offerings, (b) expanding our customer base and enhancing
penetration within existing customers. Following the same initiatives, our revenue
increased from RMB31.1 million in 2022 to RMB132.6 million in 2023, and further to
RMB410.0 million in 2024, with a CAGR of 263.1%. In addition, we plan to explore
overseas market opportunities in regions such as Australia, Europe, and South America
to further expand our business;
 improving gross profit margin by optimizing cost structure and focusing
higher-value-added products and solutions. We will focus on innovation in our
proprietary technology and our product and solution portfolio to continuously improve
the gross profit margin, thereby creating more value for our customers and sustaining
our profitability. Furthermore, we will enhance supply chain management and seek
long-term partnerships to reduce average procurement costs and maintain our delivery
capabilities;
FINANCIAL INFORMATION
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 improving operating efficiency to keep operating expenses at a reasonable level relative
to our revenue scale. As our business expands and commercialization matures, we
benefit from economies of scale. Our selling expenses, general and administrative
expenses, and research and development costs as a percentage of revenue have all
shown a decreasing trend throughout the Track Record Period. We will continue to
actively monitor our operating expenses and leverage our existing experience to
optimize resource allocation and further enhance efficiency; and
 enhancing working capital efficiency through improved receivables collection and better
inventory management.
Net Cash Flows Generated from/(Used in) Investing Activities
In the six months ended June 30, 2025, we had net cash generated from investing activities of
RMB7.7 million, which was primarily attributable to (i) proceeds received at the maturity of
financial assets at FVTPL of RMB10.0 million, and (ii) repayment from restricted bank deposits of
RMB9.8 million, partially offset by placement of restricted bank deposits of RMB9.9 million .
In 2024, our net cash flows generated from investing activities was RMB125.1 million, which
was primarily attributable to repayment from term deposits of RMB140.0 million, partially offset
by (i) purchase of financial assets at FVTPL of RMB10.5 million, and (ii) placement of restricted
bank deposits of RMB10.2 million.
In 2023, our net cash flows generated from investing activities was RMB59.0 million, which
was primarily attributable to (i) repayment from term deposits of RMB40.0 million, and (ii)
proceed received at the maturity of financial assets at FVTPL of RMB30.0 million, partially offset
by purchase of property, plant and equipment of RMB29.7 million.
In 2022, our net cash flows used in investing activities was RMB302.4 million, which was
primarily attributable to (i) purchase of property, plant and equipment of RMB152.6 million, (ii)
purchase of term deposits of RMB105.0 million, and (iii) purchase of financial assets at FVTPL of
RMB30.5 million.
Net Cash Flows Generated from/(Used in) Financing Activities
In the six months ended June 30, 2025, we had net cash generated from financing activities
of RMB80.4 million, which was primarily attributable to proceeds from bank borrowings of
RMB158.6 million, partially offset by repayment of bank borrowings of RMB72.7 million.
FINANCIAL INFORMATION
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In 2024, our net cash flows generated from financing activities were RMB94.3 million,
primarily attributable to proceeds from bank borrowings of RMB238.9 million, partially offset by
repayment of bank borrowings of RMB128.7 million.
In 2023, our net cash flows used in financing activities were RMB9.2 million, primarily
attributable to repayment of bank borrowings of RMB44.5 million, primarily offset by (i) proceeds
from bank borrowings of RMB25.7 million and (ii) proceeds from issuance of shares with
preferred rights of RMB24.0 million.
In 2022, our net cash flows generated from financing activities were RMB386.3 million,
primarily attributable to (i) proceeds from issuance of shares with preferred rights of RMB270.3
million, and (ii) proceeds from bank borrowings of RMB146.1 million, primarily offset by
transaction costs for acquisition of capital contributions from investors of RMB19.9 million.
Cash Conversion Cycle Analysis
Our cash conversion cycle, a metric to measure how efficiently we manage our working
capital by tracking the number of days we take to convert our investments in inventory and other
resources into cash flows from sales, was 933.0 days, 495.2 days, 188.2 days and 78.6 days in
2022, 2023, 2024 and the six months ended June 30, 2025, respectively. The cash conversion cycle
is calculated by adding inventory turnover days and trade receivables turnover days, then
subtracting trade payables turnover days.
Our cash conversion cycle has shown a significant improvement over the Track Record
Period, decreasing from 933.0 days in 2022 to 78.6 days in the six months ended June 30, 2025.
The improvement during the Track Record Period was primarily attributable to the fact that the
decrease in our inventory turnover days and trade receivables turnover days far exceeded the
decrease in trade payables turnover days, particularly the substantial decrease in inventory
turnover days. See “— Discussion of Key Items of Consolidated Statements of Financial Position
— Net Current Assets/(Liabilities).”
FINANCIAL INFORMATION
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The improvement of cash conversion cycle reflects our enhanced operational efficiency and
improved working capital management. However, the cash conversion cycle in the six months
ended June 30, 2025 remains relatively prolonged. A prolonged cash conversion cycle can increase
working capital requirements and pressure liquidity, particularly during periods of rapid growth or
large-scale project execution. While we have mitigated these risks through the following prudent
working capital management policies:
i we proactively negotiate with customers and suppliers to optimize credit terms. For
example, we negotiate with suppliers to settle payments only after receiving payments
from customers for certain projects, thereby effectively alleviating cash flow pressure;
or the installment payment arrangements between our major customers and suppliers are
generally aligned in both timing and amount, ensuring that monthly cash inflows are
sufficient to cover corresponding cash outflows;
ii for large-scale projects, we plan funding in advance and coordinate the use of available
committed unutilized bank facilities to ensure smooth project execution;
iii we conduct regular monthly monitoring of the aging and balances of our receivables and
payables, as well as inventory levels, to enable timely adjustments to our business
operation strategies;
iv we utilize diversified funding channels, and in addition to cash inflows from operations,
we also maintain strong banking credit lines to support working capital needs.
In the six months ended June 30, 2025, we granted 24-month credit terms and monthly
installment payment arrangements to Customer M and Customer P, primarily because these
customers, as well-known local mining operators, have strong bargaining power. Such credit terms
and installment arrangements for these strategic customers help us strengthen customer
relationships and secure long-term or large-scale contracts in a competitive market.
Going forward, we still plan to primarily adopt payment arrangements that require stage
payment or bullet payment within a relatively short credit period. However, we will also conduct
prudent assessments of potential customers who require monthly installment payments and long
credit terms, including their credit status, the operational status of their existing projects, and their
financial condition. At the same time, even when we provide certain customers with long credit
periods and monthly installment payment arrangements, we also negotiate with suppliers to adopt
similar credit periods and installment arrangements, in order to avoid cash flow mismatches and
reduce our liquidity pressure.
FINANCIAL INFORMATION
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Based on the aforementioned working capital management policies, and the following
consideration, we believe we have sufficient liquidity to support our business and to ensure the
viability of our operations:
i. as of October 31, 2025, our committed unutilized bank facilities amounted to RMB460.0
million, providing a substantial liquidity buffer to meet our working capital
requirements, including daily operations, procurement settlements and short-term
funding needs. We will continue to source additional borrowings and means of trade
financing methods to further increase our liquidity buffer as our business expands.
ii. the increases in trade and notes receivables and trade and notes payables as of June 30,
2025 were primarily attributable to the concentrated revenue recognition from three
large-scale autonomous mining truck projects in the second quarter of 2025. We have
agreed upon matched monthly installment or stage payment arrangements with the
relevant customers and suppliers for these projects. As a result, the increases are not
expected to have any material adverse impact on our liquidity or our daily operations.
iii. we have been endeavoring to strike a balance between cash inflows and outflows on
project basis. Our trade receivables turnover days for the six months ended June 30,
2025 (121.7 days) were slightly higher than our trade payables turnover days for the
same period (114.1 days). The difference of 7.6 days appears to be manageable.
CASH OPERATING COSTS
The following table sets forth key information relating to our cash operating costs for the
periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
Workforce employment (1) ........... 150,652 155,767 151,640 85,897 83,033
Direct production costs, including
materials (2) ................... 75,507 164,809 144,293 121,843 49,135
R&D costs (3) ................... 10,797 6,985 7,710 1,764 2,562
Product marketing ................ 11,172 14,759 29,170 17,148 56,736
Listing expenses ................ — — 12,937 — 2,401
Total ......................... 248,128 342,320 345,750 226,652 193,867
FINANCIAL INFORMATION
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Notes:
(1) Workforce employment represents staff costs mainly including salaries and wages.
(2) Direct production costs, including materials, mainly represent raw material and consumables costs.
(3) R&D costs mainly represent testing fees and technical service expenses.
INDEBTEDNESS
As of December 31, 2022, 2023, 2024 and June 30, 2025 and October 31, 2025, our
indebtedness included borrowings, lease liabilities, contingent liabilities or guarantees, and
financial instruments with preferred rights at amortized cost. The following table sets forth the
breakdown of our indebtedness as of the dates indicated:
As of December 31,
As of
June 30,
As of
October 31,
2022 2023 2024 2025 2025
(RMB in thousands)
(unaudited)
Current
Borrowings .................... 44,606 123,834 153,842 230,884 237,079
Lease liabilities .................. 4,566 2,980 3,661 5,937 5,480
Contingent liabilities or guarantees .... — 186 6,452 50,515 40,096
Financial instruments with preferred
rights at amortized cost .......... — — — 1,962,541 2,009,230
Non-current
Borrowings .................... 101,800 3,700 83,900 94,800 85,400
Lease liabilities .................. 1,875 608 332 180 503
Financial instruments with preferred
rights at amortized cost ........... 1,625,922 1,766,025 1,894,618 — —
Total ......................... 1,778,769 1,897,333 2,142,805 2,344,857 2,377,788
Except for our indebtedness as disclosed above as of December 31, 2022, 2023, 2024 and
June 30, 2025 and October 31, 2025, we did not have any material mortgages, charges, debentures,
loan capital, debt securities, loans, bank overdrafts or other similar indebtedness, finance lease or
hire purchase commitments, liabilities under acceptances (other than normal trade bills), or
acceptance credits, which were either guaranteed or unguaranteed, secured or unsecured.
FINANCIAL INFORMATION
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Borrowings
As of December 31, 2022, 2023, 2024 and June 30, 2025 and October 31, 2025, we had
borrowings of RMB146.4 million, RMB127.5 million, RMB237.7 million, RMB325.7 million and
RMB322.5 million, respectively, mainly representing secured and unsecured bank loans primarily
to supplement our working capital. Our borrowings are all denominated in Renminbi. The effective
interest rate on our bank loans ranged from 2.5% to 5.1% during the Track Record Period. As of
October 31, 2025, our committed unutilized bank facilities amounted to RMB460.0 million. The
following table sets forth our interest-bearing borrowings as of the dates indicated:
As of December 31,
As of
June 30,
As of
October 31,
2022 2023 2024 2025 2025
(RMB in thousands)
(unaudited)
Borrowings included in current
liabilities
Secured and unguaranteed bank
borrowings ................... 34,512 90,528 39,822 47,689 45,712
Unsecured and unguaranteed bank
borrowings ................... 10,013 23,225 114,020 181,171 191,367
Secured and guaranteed bank
borrowings ................... 81 10,081 — — —
Other borrowings ................ — — — 2,024 —
44,606 123,834 153,842 230,884 237,079
Borrowings included in non-current
liabilities
Secured and unguaranteed bank
borrowings ................... 91,800 3,700 83,900 75,800 66,900
Secured and guaranteed bank
borrowings ................... 10,000 ————
Unsecured and unguaranteed bank
borrowings ................... — — — 19,000 18,500
101,800 3,700 83,900 94,800 85,400
Total borrowings ................ 146,406 127,534 237,742 325,684 322,479
FINANCIAL INFORMATION
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Our Directors confirm that, there was no material covenant on any of our outstanding debt as
of the Latest Practicable Date, and there was no breach of any covenants during the Track Record
Period and up to the Latest Practicable Date. Our Directors further confirm that we did not
experience any difficulty in obtaining bank loans and other borrowings, default in payment of bank
loans and other borrowings or breach of covenants during the Track Record Period and up to the
Latest Practicable Date.
Lease Liabilities
As of December 31, 2022, 2023, 2024 and June 30, 2025 and October 31, 2025, our total
lease liabilities (including current and non-current portions) amounted to RMB6.4 million,
RMB3.6 million, RMB4.0 million, RMB6.1 million and RMB6.0 million, respectively.
Our total lease liabilities decreased from RMB6.4 million as of December 31, 2022 to
RMB3.6 million as of December 31, 2023, primarily in relation to the expiration and renewal of
leased properties. Our total lease liabilities remained relatively stable at RMB3.6 million as of
December 31, 2023, RMB4.0 million as of December 31, 2024. Our total lease liabilities further
increased from RMB4.0 million as of December 31, 2024 to RMB6.1 million as of June 30, 2025,
primarily due to renewal of leased properties. Our total lease liabilities remained relatively stable
at RMB6.1 million and RMB6.0 million, respectively, as of June 30, 2025 and October 31, 2025.
Contingent Liabilities or Guarantees
As of December 31, 2022, 2023, 2024 and June 30, 2025 and October 31, 2025, our total
contingent liabilities or guarantees amounted to nil, RMB0.2 million, RMB6.5 million, RMB50.5
million and RMB40.1 million, respectively.
Our contingent liabilities or guarantees increased from RMB0.2 million as of December 31,
2023 to RMB6.5 million as of December 31, 2024, primarily in relation to our financial guarantee
contracts liability. Our contingent liabilities or guarantees further increased from RMB6.5 million
as of December 31, 2024 to RMB50.5 million as of June 30, 2025, primarily due to Customer K’s
default under its finance lease agreement. Our contingent liabilities then decreased to RMB40.1
million as of October 31, 2025, primarily because we fulfilled our guarantee obligations for
Customer K for the period from July to September 2025. See “Business — Customers — Major
Customers — Transactions with Customer K.”
FINANCIAL INFORMATION
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Financial Instruments with Preferred Rights at Amortized Cost
As of December 31, 2022, 2023, 2024 and June 30, 2025 and October 31, 2025, our financial
instruments with preferred rights at amortized cost amounted to RMB1,625.9 million, RMB1,766.0
million, RMB1,894.6 million, RMB1,962.5 million and RMB2,009.2 million, respectively,
primarily in relation to our Series A financing to Series C+ financing.
No Other Outstanding Indebtedness
Save as disclosed above, we did not have outstanding indebtedness or any loan capital issued
and outstanding or agreed to be issued, bank overdrafts, loans or similar indebtedness, liabilities
under acceptances (other than normal trade bills), acceptance credits, debentures, mortgages,
charges, finance leases or hire purchase commitments, guarantees or other contingent liabilities or
any covenant in connection therewith as of October 31, 2025, being our indebtedness statement
date. After due and careful consideration, our Directors confirm that, up to the date of this
prospectus, there has been no material change in our indebtedness since October 31, 2025.
CONTINGENT LIABILITIES
Save as disclosed above, as of December 31, 2022, 2023, 2024 and June 30 and September
30, 2025, we did not have any material contingent liabilities.
KEY FINANCIAL RATIOS
The following table sets forth our key financial ratios for the periods indicated:
As of/For the year ended December 31,
As of/For the
six months
ended June 30,
2022 2023 2024 2025
Gross profit/(loss) margin (%) (1) ..... (19.3) 20.2 24.7 17.1
Adjusted net loss margin (Non-IFRS
Measure) (%) (2) ............... (511.5) (103.7) (30.9) (27.2)
Current ratio (3) .................. 3.0 1.9 1.8 0.4
Quick ratio (4).................... 2.5 1.5 1.6 0.3
Cash ratio (5) .................... 1.9 0.6 0.8 0.1
Notes:
(1) Gross profit/(loss) margin equals gross profit/(loss) divided by revenue and multiplied by 100%.
FINANCIAL INFORMATION
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(2) Adjusted net loss margin (Non-IFRS Measure) equals adjusted net loss margin (Non-IFRS Measure) for the year
divided by revenue for the year and multiplied by 100%. The use of the non-IFRS measure has limitations as an
analytical tool, and you should not consider it in isolation from, or as a substitute for or superior to, the analysis of
our results of operations or financial condition as reported under the IFRS.
(3) Current ratio equals current assets divided by current liabilities as of the same date.
(4) Quick ratio equals current assets less inventories divided by current liabilities as of the same date.
(5) Cash ratio equals the sum of cash and cash equivalents and financial assets at FVTPL recorded as current assets
divided by the total current liabilities as of the same date.
R&D EXPENDITURE AND TOTAL OPERATING EXPENDITURE
During the Track Record Period, our R&D expenditure primarily consisted of R&D expenses
adjusted by adding back intangible assets acquired from a third party and capitalized in connection
with R&D software and deducting amortization expense of capitalized intangible assets included in
R&D expenditure. The table below sets forth our annual and total R&D expenditure for the periods
indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
R&D expenses .............. 110,507 90,396 193,181 35,339 151,317
Adjustments:
Add: Intangible assets acquired
from a third party and
capitalized in connection with
R&D software ............. 999 38 341 318 —
Less: Amortization expense of
capitalized intangible assets
included in R&D expenditure . 239 337 335 156 193
Annual R&D expenditure ..... 111,267 90,097 193,187 35,501 151,124
Total R&D expenditure ...... 394,551
(1) 186,625
Note:
(1) Total R&D expenditure for the three financial years prior to Listing.
FINANCIAL INFORMATION
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The table below sets forth our annual and total operating expenditure for the periods
indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(RMB in thousands)
(unaudited)
R&D expenses .............. 110,507 90,396 193,181 35,339 151,317
Selling expenses ............. 23,148 31,404 64,439 23,611 44,288
General and administrative
expenses ................. 68,969 97,827 300,721 56,070 199,678
Adjustments:
Add: Intangible assets acquired
from a third party and
capitalized in connection with
R&D software ............. 999 38 341 318 —
Less: Amortization expense of
capitalized intangible assets
included in R&D expenditure . 239 337 335 156 193
Annual total operating
expenditure .............. 203,384 219,328 558,347 115,182 395,090
Total operating expenditure ... 981,059
(1) 510,272
Note:
(1) Total R&D expenditure for the three financial years prior to Listing.
The table below sets forth our annual R&D expenditure ratio and total R&D expenditure ratio
for the periods indicated:
Y ear ended December 31, Six months ended June 30,
2022 2023 2024 2024 2025
(unaudited)
Annual R&D expenditure
ratio (1) .................. 54.7 41.1 34.6 30.7 38.3
Total R&D expenditure ratio .. 40.2 (2) 36.6
Notes:
(1) Calculated by dividing annual R&D expenditure by annual total operating expenditure.
(2) Calculated by dividing total R&D expenditure for the three financial years prior to Listing by total operating
expenditure for the three financial years prior to Listing.
FINANCIAL INFORMATION
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CAPITAL EXPENDITURES
During the Track Record Period, our capital expenditures primarily consisted of purchase of
property, plant and equipment and purchase of intangible assets. The table below sets forth our
capital expenditure for the periods indicated:
Y ear ended December 31,
Six months
ended June 30,
2022 2023 2024 2025
(RMB in thousands)
Purchase of property, plant and
equipment .................... 152,611 29,713 1,393 1,065
Purchase of intangible assets ........ 808 699 684 705
Total .......................... 153,419 30,412 2,077 1,770
In 2022, 2023, 2024 and in the six months ended June 30, 2025, our capital expenditures
were RMB153.4 million, RMB30.4 million, RMB2.1 million and RMB1.8 million, respectively.
We funded these expenditures mainly with cash generated from our operation and financing
activities.
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, bank borrowings, and the net proceeds received from the Global Offering.
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
In March 2023, we entered into an agreement to invest in 9.7% equity interests of Chengdu
Cidi Rongchuang Entrepreneurship Investment Partnership (Limited Partnership) with a total
investment of RMB9.8 million.
FINANCIAL INFORMATION
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Our Company paid the investment of RMB1 million, RMB0.5 million and RMB0.5 million in
November 2023, December 2024 and January 2025, respectively. The committed amount will be
due for payment before August 2030. See Note 35 to the Accountant’s Report included in
Appendix I to this prospectus.
As of June 30, 2025, we have commitment to inject capital to our subsidiary, Anhui CiDi
Engineering Technology Co., Ltd., amounting to RMB2.55 million. The committed amount will be
due for payment before May 2029.
Save as disclosed above, during the Track Record Period, we did not have any material
capital commitments.
RELATED PARTY TRANSACTIONS
For details about our related party transactions during the Track Record Period, see Note 35
of the Accountant’s Report included in Appendix I to this prospectus.
Our Directors are of the view that each of the related party transactions set out in Note 35 to
the Accountant’s Report included in Appendix I to this prospectus was conducted in the ordinary
course of business on an arm’s-length basis and with normal commercial terms between the
relevant parties. Our Directors are also of the view that our related party transactions during the
Track Record Period would not distort our track record results or 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. We also have not entered into any financial guarantees or other commitments to
guarantee the payment obligations of third parties. In addition, we have not entered into any
derivative contracts that are indexed to our equity interests and classified as owners’ equity.
Furthermore, we do not have any retained or contingent interest in assets transferred to an
unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do
not have any variable interest in any unconsolidated entity that provides financing, liquidity,
market risk or credit support to us or that engages in leasing, hedging or research and development
services with us.
FINANCIAL INFORMATION
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PROPERTY INTERESTS AND PROPERTY V ALUATION REPORT
A VISTA Valuation Advisory Limited, an independent property valuer, has valued certain of
our property interests as of September 30, 2025 and is of the opinion that the total estimated value
in existing state as at such date was RMB315.1 million. The full text of the letter, summary of
valuation and valuation certificates with regard to such property interests are set out in Appendix
ř to this prospectus. A reconciliation of the net book value of our properties as of June 30, 2025,
as set out in the Accountants’ Report in Appendix I to this prospectus to their fair value as of
September 30, 2025 as stated in the property valuation report set out in Appendix ř to this
prospectus is set out below:
(RMB in thousands)
Net book value as of June 30, 2025 ............................. 317,476
Addition during the period from July 1, 2025 to September 30, 2025 .... —
Less: Depreciation during the period from July 1, 2025 to
September 30, 2025 ........................................ 3,875
Net book value as of September 30, 2025 ........................ 313,601
Net valuation surplus ......................................... 1,469
Valuation of properties owned by our Group as of September 30, 2025
as set out in the property valuation report in Appendix III to this
prospectus .............................................. 315,070
FINANCIAL RISKS MANAGEMENT
We are exposed to a variety of financial risks, including market risk, credit risk and liquidity
risk. Our overall risk management program focuses on the unpredictability of financial markets
and seeks to minimize potential adverse effects on our financial performance. See Note 3 of the
Accountant’s Report included in Appendix I to this prospectus.
Market Risk
Foreign Exchange Risk
Foreign exchange risk arises from future commercial transactions and recognized assets and
liabilities denominated in a currency that is not the functional currency of the relevant group
entity. Our businesses are principally conducted in RMB.
As of December 31, 2022, 2023, 2024 and June 30, 2025, we were not exposed to significant
foreign exchange risk. We regularly monitor our foreign exchange risk to ensure there is no undue
exposure to significant foreign exchange risk.
FINANCIAL INFORMATION
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Cash Flow and Fair V alue Interest Rate Risk
Our interest rate risk primarily arises from borrowings, financial instruments with preferred
rights at amortized cost, financial assets measured at FVTPL, cash and cash equivalents, restricted
bank deposits and term deposits. Those carried at floating rates expose us to cash flow interest rate
risk whereas those carried at fixed rates expose us to fair value interest rate risk. The interest rates
and terms of repayments of borrowings are disclosed in Note 28 of the Accountant’s Report
included in Appendix I to this prospectus. We did not use any interest rate swap contracts or other
financial instruments to hedge against its interest rate risk for each reporting period.
As of December 31, 2022, 2023, 2024 and June 30, 2025, we were not exposed to significant
interest rate risk. We regularly monitor our interest rate risk to ensure there is no undue exposure
to significant interest rate risk.
Credit Risk
We are exposed to credit risk in relation to our cash and cash equivalents, restricted bank
deposits, term deposits, trade and notes receivables, contract assets, other receivables, financial
assets at FVTOCI and financial guarantee contracts liability. The carrying amount of each class of
the above assets represents our maximum exposure to credit risk in relation to the corresponding
class of assets.
Credit Risk of Cash and Cash Equivalents, Restricted Bank Deposits and Term Deposits
To manage this risk, our domestic subsidiaries only make transactions with state-owned banks
or reputable commercial banks which are all high-credit-quality financial institutions. There has
been no recent history of default in relation to these financial institutions. These instruments are
considered to have low credit risk because they have a low risk of default and the counterparty has
a strong capacity to meet its contractual cash flow obligations in the near term. The credit losses
are assessed to be immaterial.
Credit Risk of Trade and Notes Receivables and Contract Assets
We apply the IFRS 9 simplified approach to measure expected credit losses which uses a
lifetime expected loss allowance for all trade receivables and contract assets. To measure the
expected credit losses, trade receivables and contract assets have been grouped based on shared
credit risk characteristics and aging.
FINANCIAL INFORMATION
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The expected loss rates are based on the credit rating of counter parties and the payment
profiles of sales over a period of each reporting period and probability of default of counter parties
on an ongoing basis throughout each reporting period. The historical loss rates are adjusted to
reflect current and forward-looking information on macroeconomic factors affecting the ability of
the customers to settle the receivables. We have identified the Gross Domestic Product (“ GDP”)
and the growth rate of information technology industry to be the most relevant factor in Mainland
China in the credit risk assessment, and accordingly adjusts the historical loss rates based on
expected changes in these factors.
Notes receivables were mainly bank acceptance notes aged less than six months. We measure
credit risk using probability of default, exposure at default and loss given default. We have
assessed that the expected credit losses rate for bank acceptance notes receivables are immaterial,
and thus the loss allowance is immaterial.
Credit Risk of Other Receivables
Other receivables mainly comprise payments made on behalf of customers, amount due from
the third parties, amount due from the employee, deposits, loan to a third party and loans to the
employee. The management of our Company makes individual assessment on the recoverability of
payments made on behalf of customers, amount due from the third parties, amount due from the
employee deposits, loan to a third party and loans to the employee based on historical settlement
records and past experiences. We measure credit risk using probability of default, exposure at
default and loss given default.
For impairment on payments made on behalf of customers, amount due from the third parties,
amount due from the employee, deposits, loan to a third party and loans to the employee, it is
measured as either 12-month expected credit losses or lifetime expected credit loss, depending on
whether there has been significant increase in credit risk since initial recognition. Other financial
assets that are not credit-impaired on initial recognition are classified in ‘Stage 1’ and the expected
credit losses are measured as 12-month expected credit losses. If a significant increase in credit
risk of other financial asset has occurred since initial recognition, the financial asset is moved to
‘Stage 2’ but is not yet deemed to be credit-impaired. The expected credit losses are measured as
lifetime expected credit loss. If any financial asset is credit-impaired, it is then moved to ‘Stage 3’
and the expected credit loss is measured as lifetime expected credit loss. Management makes
periodic collective assessments as well as individual assessment on these financial assets based on
historical settlement records and past experience.
FINANCIAL INFORMATION
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Credit Risk of Financial Assets at FVTOCI
Financial assets at FVTOCI comprise receivables financing. Receivables financing mainly
represents bills of acceptance issued by banks for the sale of goods. We expect that the change of
fair value associated with bank bills of acceptance is considered to be immaterial since they have
original maturities of six months or less and the accepting banks are state-owned banks and other
large listed banks with good reputation and high credit rating.
Credit Risk of Financial Guarantee Contracts Liability
The management of our Company makes individual assessment on the expected credit losses
of financial guarantee contracts. We measure credit risk using probability of default, exposure at
default and loss given default.
Liquidity Risk
Prudent liquidity risk management implies maintaining sufficient cash and cash equivalents
and the ability to raise funds through debt and equity financing. We historically financed our
working capital requirements through borrowing from bank, issue of financial instruments with
preferred rights at amortized cost.
Management monitors rolling forecasts of our liquidity reserve on the basis of expected cash
flows.
For financial instruments with preferred rights at amortized cost, please refer to Note 29 of
the Accountant’s Report included in Appendix I to this prospectus for more details.
DIVIDENDS
No dividend was paid or declared by our Company or other entities comprising our Group
during the Track Record Period and as of the date of this prospectus. Any declaration and
payment, as well as the amount of dividends, will be subject to our Articles of Association and the
relevant PRC laws. We currently do not have any dividend policy or fixed dividend pay-out ratio.
No dividend shall be declared or payable except out of our profits and reserves lawfully available
for distribution. As confirmed by our PRC Legal Advisor, according to relevant PRC laws, any
future net profit that we make will have to be first applied to make up for our historically
accumulated losses, after which we will be obliged to allocate 10% of our net profit to our
statutory common reserve fund until such fund has reached more than 50% of our registered
FINANCIAL INFORMATION
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capital. We will, therefore, only be able to declare dividends after: (i) all our historically
accumulated losses have been made up for; and (ii) we have allocated sufficient net profit to our
statutory common reserve fund as described above.
WORKING CAPITAL CONFIRMATION
Our Directors are of the opinion that, taking into account the net proceeds from the Global
Offering and the financial resources available to us, including our future operating cash flows in
respective periods, cash and cash equivalents, financial assets at FVTPL, term deposits, restricted
bank deposits, available equity financing and committed unutilized bank facilities, we have
sufficient working capital to meet our present requirements and for the next 12 months from the
date of this prospectus.
Our cash burn rate refers to the average monthly (i) net cash used in operating activities, (ii)
purchase of property, plant and equipment, (iii) purchase of intangible assets, (iv) repayment of
lease liabilities, (v) interest paid on lease liabilities, and (vi) interest paid on bank borrowings. Our
historical cash burn rate was RMB30.6 million, RMB20.1 million, RMB13.5 million and RMB36.2
million in 2022, 2023, 2024 and June 30, 2025, respectively, mainly representing our investment in
R&D activities. In 2022, we recorded significant capital expenditure in purchase of property, plant
and equipment, primarily due to the construction of our industrial park, which was substantially
completed by the end of 2022. The relatively higher cash burn rate in the six months ended June
30, 2025 was primarily attributable to (i) the comparatively lower cash burn rate in 2024, which
mainly resulted from payments received in 2024 for the project carried out in collaboration with
Customer K, and (ii) increased operating cash outflows driven by the expansion of our business
scale, including the increase in inventories due to the increased number of ongoing orders and
larger order sizes for autonomous mining products and solutions.
We had (i) cash and cash equivalents of RMB101.1 million, (ii) committed unutilized bank
facilities of RMB460.0 million, and (iii) financial assets at FVTPL, term deposits and restricted
bank deposits of RMB30.8 million as of October 31, 2025. We estimate that we will receive net
proceeds of approximately HK$1,309.0 million after deducting the underwriting fees and expenses
payable by us in the Global Offering, assuming that the Over-allotment Option is not exercised and
assuming an Offer Price of HK$263.00 per Offer Share. Assuming that the average cash burn rate
going forward will be similar to the cash burn rate level in the six months ended June 30, 2025,
based on the underlying assumptions that (i) the number of our employees will not increase
significantly, particularly in the R&D department, (ii) we do not expect substantial capital
investment, and (iii) we do not expect significant acquisitions of fixed assets, we estimate that our
cash and cash equivalents, financial assets at FVTPL, term deposits, restricted bank deposits and
committed unutilized bank facilities totaling RMB591.9 million as of October 31, 2025, will be
able to maintain our financial viability for 16 months from October 30, 2025 to February 28, 2027
FINANCIAL INFORMATION
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or, if we take into account 10% of the estimated net proceeds from the Listing (namely, the portion
allocated for our working capital and other general corporate purposes) together with the foregoing
liquidity resources totaling RMB710.9 million, 20 months from October 31, 2025 to June 30, 2027
or, if we also take into account the estimated net proceeds from the Listing together with the
foregoing liquidity resources totaling RMB1,781.6 million, 49 months from October 31, 2025 to
November 30, 2029. We will continue to monitor our cash flows from operations closely and
maintain our financial viability through a variety of means, including, among others, banking
facilities and external financings.
DISTRIBUTABLE RESERVES
As of June 30, 2025, we did not have any distributable reserves.
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 RMB103.0 million (assuming no exercise of the Over-allotment Option),
representing 8.0% of the gross proceeds (assuming that the Over-allotment Option is not exercised)
of the Global Offering. During the Track Record Period, we incurred listing expenses of RMB24.9
million, of which RMB21.3 million was charged to the consolidated statements of profit or loss as
general and administrative expenses and RMB3.6 million will be deducted from equity. We expect
to incur listing expenses of approximately RMB103.0 million, of which approximately RMB45.0
million is expected to be recognized in the consolidated statements of profit or loss as general
administrative expenses and approximately RMB58.0 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 comprised
of (i) underwriting related expenses of approximately RMB51.7 million, and (ii) non-underwriting
related expenses of approximately RMB51.2 million, which consist of fees and expenses of legal
advisors and Reporting Accountant of approximately RMB27.2 million and other fees and
expenses of approximately RMB24.0 million.
FINANCIAL INFORMATION
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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 June 30, 2025,
being the end date of the periods reported in Appendix I to this prospectus, and there is no event
since June 30, 2025, that would materially affect the information as set out in the Accountant’s
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 an Offer Price of HK$263.00 per Share, we estimate that we will receive
net proceeds of approximately HK$1,309.0 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 55% of the net proceeds, or HK$720.0 million, will be used for our
research and development in the next five years, including:
Investments in R&D of next-generation intelligent driving platform
i. approximately 30% of the net proceeds, or HK$392.7 million, will be used for the
R&D team of our next-generation intelligent driving platform, which is expected to
further accelerate the continuous advancement of our commercial vehicle
intelligent driving technology and core algorithms. We plan to (i) expand our R&D
team by recruiting top scientists and engineers from around the world, as well as
talent from renowned universities in intelligent driving technology; (ii) remunerate
our existing R&D personnel to ensure the stability and continuity of our R&D
progress; and (iii) offer our R&D personnel comprehensive professional training to
enhance their interdisciplinary and multi-dimensional technological application
skills.
ii. approximately 5% of the net proceeds, or HK$65.5 million, will be used for the
integration of software, hardware and algorithms of our next-generation intelligent
driving platform. Our need for cloud computing resources and R&D and testing
equipment and software is increasing with the ongoing accumulation of data and
scenarios, coupled with the continuous improvement of training algorithms.
Therefore, leveraging our existing R&D platform, we intend to invest further in
upgrading our technical infrastructure, including, but not limited to, cloud service
resources to enhance our data storage capability and software systems to enhance
our algorithm, software and hardware development capabilities. Such initiative will
enhance our intelligent driving computing power and algorithm capabilities,
improve the modularity of algorithms and product configurations, and optimize our
FUTURE PLANS AND USE OF PROCEEDS
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R&D and solution-testing processes, promoting the continuous expansion of
intelligent driving solution applications. Through these investments, our business
synergies can be further strengthened as autonomous driving and V2X are closely
related technological systems that share a range of technologies, including active
sensing, line-of-sight perception, object detection, deep learning, edge computing
and cloud platform technologies.
Investments in V2X and intelligent perception upgrading projects
i. approximately 15% of the net proceeds, or HK$196.4 million, will be used for the
R&D team of our V2X and an intelligent perception upgrading, which is expected
to provide customers with more advanced solutions in V2X and intelligent
perception by optimizing the performance of software and hardware equipment
such as sensor suites, intelligent processing units, and intelligent dispatching
systems. We plan to (i) recruit experienced R&D and testing personnel for
hardware and software systems; (ii) remunerate our existing R&D personnel to
ensure the stability and continuity of our R&D progress; and (iii) offer our R&D
personnel comprehensive professional training to enhance their interdisciplinary
and multi-dimensional technological application skills.
ii. approximately 5% of the net proceeds, or HK$65.5 million, will be used for the
upgrading of our R&D software and hardware equipment. We plan to purchase and
enhance computing resources and other hardware to improve the performance of
intelligent perception suites, including LiDAR, visual sensors, and millimeter-wave
radars. In addition, we plan to utilize such equipment to explore localized
alternatives for V2X intelligent processing, further develop the intelligent
scheduling system and software function modules, optimize the core algorithm of
multi-sensor fusion, enhance deep embedded optimization, and reduce the cost of
kit products such as computing power units and sensors.
 Approximately 15% of the net proceeds, or HK$196.4 million, will be used for
improvement of our commercialization capabilities in China and overseas and further
strengthening our cooperation with domestic and global customers, including:
(i) approximately 10% of the net proceeds, or HK$130.9 million, will be used for
enhancement of sales and marketing capabilities and delivery capabilities,
including (i) expanding our sales and service network, improving the quality of
services, and enhancing product customization to meet customer needs for
intelligent driving applications, (ii) increasing brand awareness by (a) recruiting
more marketing and sales personnel with industry expertise to strengthen our sales
FUTURE PLANS AND USE OF PROCEEDS
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and marketing team, and (b) actively engaging in marketing activities, such as
exhibitions and conferences and (iii) enhancing our engineering and delivery teams
by recruiting technical experts with specialized backgrounds in autonomous
driving, aiming to elevate the quality and standards of our deliveries and technical
support capabilities to align with our expanding business scale. Such efforts will
allow us to engage more OEMs, expand our customer base and scale our business;
and
(ii) approximately 5% of the net proceeds, or HK$65.5 million, will be used for
enhancing the international footprint by (i) expanding the overseas sales channel
and sales network, recruiting experienced sales personnel in overseas markets and
improving the efficiency of overseas sales and marketing activities; and (ii)
building an overseas localization service team, covering operation, engineering and
delivery, and customer on-site technical support, to improve our localization
service capabilities.
 Approximately 20% of the net proceeds, or HK$261.8 million, will be used for potential
investment, and merger and acquisition opportunities aimed at further integrating
upstream and downstream resources in the industrial chain. We will strategically seek
appropriate investment and M&A opportunities to expand our business both upstream
and downstream within the industry chain, aiming to effectively integrate our business
resources, ensuring supply chain stability and enhancing our delivery capabilities across
various application scenarios. Our potential investment and acquisition targets include
(i) suppliers with robust R&D and delivery capabilities in hardware, software systems,
and key components for intelligent driving, and (ii) suppliers with strong production and
delivery capabilities in intelligent driving vehicles and V2X hardware.
 Approximately 10% of the net proceeds, or HK$130.9 million, will be employed as
working capital and for general corporate uses.
The additional net proceeds that we would receive if the Over-allotment Option were
exercised in full would be HK$213.3 million. In the event that the Over-allotment Option is
exercised in full, we intent to apply the additional net proceeds to the above purposes in the
proportions stated above.
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.
FUTURE PLANS AND USE OF PROCEEDS
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To the extent that the net proceeds of the Global Offering are not immediately used for the
above purposes or if we are unable to effect any part of our future development plans as intended,
we will 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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HONG KONG UNDERWRITERS
China International Capital Corporation Hong Kong Securities Limited
China Securities (International) Corporate Finance Company Limited
Ping An Securities (Hong Kong) Company Limited
ABCI Securities Company Limited
Funde Securities Limited
Guosen Securities (HK) Brokerage Company, Limited
ICBC International Securities Limited
China Everbright Securities (HK) Limited
Winbull Securities International (Hong Kong) Limited
Livermore Holdings Limited
Shenwan Hongyuan Securities (H.K.) Limited
Tiger Brokers (HK) Global Limited
UNDERWRITING
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters on a
conditional basis. The International Offering is expected to be fully underwritten by the
International Underwriters.
The Global Offering comprises the Hong Kong Public Offering of initially 270,400 Hong
Kong Offer Shares and the International Offering of initially 5,137,580 International Offer Shares,
subject, in each case, to reallocation on the basis as described in the section headed “Structure of
the Global Offering” as well as the Over-Allotment Option (in the case of the International
Offering).
UNDERWRITING ARRANGEMENTS AND EXPENSES
The Hong Kong Public Offering
Hong Kong Underwriting Agreement
Pursuant to the Hong Kong Underwriting Agreement, the Company is offering initially
270,400 Hong Kong Offer Shares for subscription by the public in Hong Kong on and subject to
the terms and conditions of this Prospectus at the Offer Price.
Subject to (a) the Stock Exchange granting approval for the listing of, and permission to deal
in, the H Shares to be converted from Unlisted Shares and to be offered pursuant to the Global
Offering as mentioned herein and such approval not having been withdrawn and (b) certain other
UNDERWRITING
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conditions set out in the Hong Kong Underwriting Agreement, the Hong Kong Underwriters have
agreed severally and not jointly to subscribe or procure subscribers for their respective applicable
proportions of the Hong Kong Offer Shares being offered which are not taken up under the Hong
Kong Public Offering on and subject to the terms and conditions set out in this Prospectus and the
Hong Kong Underwriting Agreement. The Hong Kong Underwriting Agreement is conditional
upon and subject to, among other things, the International Underwriting Agreement having been
executed and becoming unconditional and not having been terminated in accordance with its terms.
For applicants applying under the Hong Kong Public Offering, this Prospectus contains the
terms and conditions of the Hong Kong Public Offering. The International Offering is expected to
be fully underwritten by the International Underwriters.
Grounds for Termination
The obligations of the Hong Kong Underwriters to subscribe or procure subscribers for the
Hong Kong Offer Shares under the Hong Kong Underwriting Agreement are subject to termination.
If at any time prior to 8:00 a.m. on the day that trading in the H Shares commences on the Stock
Exchange:
(i) there develops, occurs, exists or comes into force:
(a) 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, or other jurisdictions relevant to the Group or the Global
Offering (each a “ Relevant Jurisdiction ” and collectively, the “ Relevant
Jurisdictions ”); or
(b) any change or development involving a prospective change, or any event or series
of events or circumstances likely to result in a 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 devaluation of the Hong Kong dollar, United
States dollar or Renminbi against any foreign currencies, a change in the system
under which the value of the Hong Kong dollar is linked to that of the United
States dollar or the Renminbi is linked to any foreign currency or currencies) or
UNDERWRITING
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other financial markets (including, without limitation, conditions and sentiments 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
(c) 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, labor disputes, 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
(d) 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 (i) the trading in shares or securities
generally on the Stock Exchange, the Shanghai Stock Exchange, the Shenzhen
Stock Exchange, the Singapore Stock Exchange, the New York Stock Exchange,
the NASDAQ Global Market or the London Stock Exchange; or (ii) the trading in
any securities of the Company listed or quoted on a stock exchange or an
over-the-counter market; or
(e) the imposition or declaration of any general moratorium on 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
(f) other than with the prior written consent of the Overall Coordinators, 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
UNDERWRITING
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(g) the commencement by any Authority or other regulatory or political body or
organization of any public action or investigation against a Group Company or a
director or a senior management member of the Company or announcing an
intention to take any such action; or
(h) the imposition of sanctions or export controls in whatever form, directly or
indirectly, on any Group Company or any of the Controlling Shareholders 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
(i) 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
(j) 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 or any aspect of the Global Offering with the
Listing Rules or any other applicable Laws; or
(k) 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 Director as named in this Prospectus; or
(l) any contravention by any Group Company or any Director of the Listing Rules or
applicable Laws; or
(m) any change or prospective change, or a materialization of, any of the risks set out
in the section headed “Risk Factors” in this Prospectus,
which, individually or in the aggregate, in the sole and absolute opinion of the Joint
Sponsors and the Overall Coordinators (for themselves and on behalf of the Hong Kong
Underwriters), (1) has or will or may have a material adverse effect, whether directly or
indirectly, on the assets, liabilities, business, general affairs, management, prospects,
shareholder’s equity, profit, losses, results of operations, position or condition, financial
or otherwise, of the Group as a whole; (2) has or will have 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; (3) makes, will make or may make it impracticable, inadvisable,
inexpedient or incapable for any material part of the Hong Kong Underwriting
UNDERWRITING
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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 this Prospectus; or (4)
has or will or may have the effect of making any part of the Hong Kong Underwriting
Agreement (including underwriting) incapable of performance in accordance with its
terms or preventing the processing of applications and/or payments pursuant to the
Global Offering or pursuant to the underwriting thereof; or
(ii) there has come to the notice of the Joint Sponsors and the Overall Coordinators (for
themselves and on behalf of the Hong Kong Underwriters) that:
(a) any statement contained in any of the Offering 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
Hong Kong Public Offering (including any supplement or amendment thereto) (the
“Global Offering Documents ”) was, when it was issued, or has become untrue,
incorrect, inaccurate 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
respect or based on untrue, dishonest or unreasonable assumptions or given in bad
faith; or
(b) 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
(c) any breach of, or any event or circumstance rendering untrue or incorrect or
misleading in any respect, any of the representations, warranties and undertakings
given by the Company or Prof. Li in the Hong Kong Underwriting Agreement or
the International Underwriting Agreement, which will have a material adverse
effect on the Global Offering; or
(d) any event, act or omission which gives rise or is likely to give rise to any liability
of any of the indemnifying parties pursuant to the indemnities in the Hong Kong
Underwriting Agreement; or
UNDERWRITING
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(e) any material breach of any of the obligations or undertakings imposed upon the
Company or Prof. Li or any cornerstone investor (as applicable) to this Agreement,
the International Underwriting Agreement or the Cornerstone Investment
Agreements; or
(f) there is any change or development involving a prospective change, constituting or
having a material adverse effect or any development involving a prospective
material adverse effect, on the profits, losses, results of operations, assets,
liabilities, general affairs, business, management, performance, prospects,
shareholders’ equity, position or condition (financial, trading or otherwise) of the
Group, taken as a whole; or
(g) that the Chairman of the Board, any executive Director named in the Prospectus is
removed from office or vacating his/her office; or
(h) any Director of the Company named in the Prospectus is being charged with an
indictable offence or prohibited by operation of law or otherwise disqualified from
taking directorship of a company; or
(i) the Company withdraws the 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
(j) 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 the additional H Shares which may be issued 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
(k) any person (other than any of the Joint Sponsors) has withdrawn its consent to the
issue of the Prospectus 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
(l) any prohibition on the Company for whatever reason from offering, allotting,
issuing or selling any of the Offer Shares (including the shares to be issued
pursuant to the Over-allotment Option) pursuant to the terms of the Global
Offering; or
UNDERWRITING
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(m) 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 will have a material adverse effect or any
development involving a prospective material adverse effect, on the profits, losses,
results of operations, assets, liabilities, general affairs, business, management,
performance, prospects, shareholders’ equity, position or condition (financial,
trading or otherwise) of the Group, taken as a whole, on the Global Offering; or
(n) (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 Overall Coordinators, 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; or
(o) that (i) a material portion of the orders placed or confirmed in the bookbuilding
process or (ii) any investment commitment made by any cornerstone investors
under the Cornerstone Investment Agreements signed with such cornerstone
investors, have been withdrawn, terminated or cancelled,
then, in each case, the Overall Coordinators (for themselves and on behalf of the Hong
Kong Underwriters) may, in their 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 Company
Pursuant to Rule 10.08 of the Listing Rules, the Company has undertaken to the Stock
Exchange that no further H Shares or securities convertible into H Shares (whether or not of a
class already listed) may be issued or form the subject of any agreement to such an issue within
six months from the Listing Date (whether or not such issue of shares or securities will be
completed within six months from the Listing Date), except for:
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(a) the issue of shares, the listing of which has been approved by the Stock Exchange,
pursuant to a share option scheme under Chapter 17 of the Listing Rules;
(b) any capitalization issue, capital reduction or consolidation or sub-division of H Shares;
(c) issue of H Shares or securities pursuant to the Global Offering (including any exercise
of the Over-Allotment Option); and
(d) any other applicable circumstances provided under Rule 10.08 of the Listing Rules.
Undertakings by Controlling Shareholders, Key Persons and Pathfinder SIIs
Pursuant to Rules 18C.13 and 18C.14 of the Listing Rules, each of Controlling Shareholders,
key persons of the Company and the Pathfinder SIIs, and their respective close associates, as
identified under the section headed “History, Development and Corporate Structure — Lock-up
Periods”, has undertaken to the Stock Exchange and to us that, except pursuant to the Global
Offering (including the Over-allotment Option), it will not, unless otherwise permitted under Rule
18C.15 of the Listing Rules: at any time in the period commencing on the date by reference to
which disclosure of its shareholding is made in this Prospectus and ending on the date which is 12
months (or 6 months in the case of the Pathfinder SIIs) from the Listing Date, 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 H Shares in respect of which it is shown by this Prospectus
to be the beneficial owner.
Note 2 to Rule 18C.14 of the Listing Rules provides that the above undertakings do not
prevent such persons from using the H Shares beneficially owned by it/him/her as security
(including a charge or 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.
Further, pursuant to Note 2 to 18C.14 of the Listing Rules, each of such persons has
undertaken to the Stock Exchange and to us that, within the period commencing on the date by
reference to which disclosure of its shareholding is made in this Prospectus and ending on the date
which is 12 months (or 6 months in the case of the Pathfinder SIIs) from the Listing Date:
(a) when it pledges or charges any H Shares beneficially owned by it 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, immediately inform us and the Stock
Exchange of such pledge or charge together with the number of H Shares so pledged or
charged; and
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(b) when it receives indications, either verbal or written, from the pledgee or chargee that
any of the pledged or charged H Shares will be disposed of, immediately inform us and
the Stock Exchange of such indications.
We will inform the Stock Exchange as soon as we have been informed of the above matters,
if any, by such persons and disclose such matters as soon as possible after being so informed.
Undertakings pursuant to the Hong Kong Underwriting Agreement
Undertakings by the Company
The Company has undertaken to each of the Joint Sponsors, the Overall Coordinators, the
Joint Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead
Managers, the Syndicate Capital Market Intermediaries and the Hong Kong Underwriters that
except 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 from the Listing Date (the “ First Six-Month Period ”), it will not, without the prior
written consent of the Joint Sponsors and the Overall Coordinators (for themselves and on behalf
of the Hong Kong Underwriters) and unless in compliance with the requirements of the Listing
Rules:
(i) allot, issue, repurchase, sell, accept subscription for, offer to allot, issue, repurchase or
sell, contract or agree to allot, issue, repurchase or sell, mortgage, charge, pledge,
hypothecate, lend, grant or sell any option, warrant, contract or right to subscribe for or
purchase, grant or purchase any option, warrant, contract or right to allot, issue,
repurchase or sell, or otherwise transfer or dispose of or create an encumbrance (an
“Encumbrance ”) over, or agree to transfer or dispose of or create an Encumbrance
over, either directly or indirectly, conditionally or unconditionally, any legal or
beneficial interest in any equity 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 securities of the Company), or deposit any equity securities of the
Company 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 any equity
securities of the Company or any interest in any of the foregoing (including, without
limitation, any equity securities convertible into or exchangeable or exercisable for or
that represent the right to receive, or any warrants or other rights to purchase, any
securities of the Company); or
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(iii) enter into any transaction with the same economic effect as any transaction described in
(i) or (ii) above; or
(iv) offer to or agree to do any of the foregoing or announce any intention to do so,
in each case, whether any of the foregoing transactions is to be settled by delivery of such
securities, in cash or otherwise (whether or not the issue of such securities will be completed
within the First Six-Month Period). In the event that, at any time during the period of six months
immediately following the expiry of the First Six-Month Period (the “ Second Six-Month
Period ”), the Company enters into any of the transactions specified in (i), (ii) or (iii) above or
offers to or agrees to or announces any intention to effect any such transactions, the Company
shall take all reasonable steps to ensure that it will not create a disorderly or false market in the H
Shares or any other securities of the Company. The Controlling Shareholders have jointly and
severally undertaken to each of the Joint Sponsors, the Overall Coordinators, the Joint Overall
Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the
Syndicate Capital Market Intermediaries and the Hong Kong Underwriters to procure the Company
to comply with the undertakings herein.
Undertakings by Prof. Li
Prof. Li has undertaken to each of the Company, the Joint Sponsors, the Sponsor-OCs, the
Overall Coordinators, the Joint Global Coordinators, the CMIs, the Joint Bookrunners, the Joint
Lead Managers and the Hong Kong Underwriters that, without the prior written consent of the
Joint Sponsors and the Overall Coordinators (for themselves and on behalf of the Hong Kong
Underwriters) and unless in compliance with the requirements of the Listing Rules that he will not
and will procure his controlled entities not to at any time (i) during the First Six Month Period,
dispose of, nor enter into any agreement to dispose of or otherwise create any options, rights,
interests or encumbrances in respect of, any securities of the Company in respect of which he is
(or his controlled entities are) shown in the Hong Kong Prospectus to be the beneficial owner(s),
unless it is otherwise permitted under the Rule 10.07 of the Listing Rules and relevant PRC laws.
The undertaking above shall not prevent Prof. Li from (i) purchasing additional H Shares or
other securities of the Company and disposing of such additional H Shares or securities of the
Company in accordance with the Listing Rules, provided that any such purchase or disposal does
not contravene the lock-up arrangements with Prof. Li as described above or the compliance by the
Company with the Minimum Public Float Requirement, and (ii) using the H Shares or other
securities of the Company or any interest therein beneficially owned by him 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, provided that (a) Prof.
Li will immediately inform the Company and the Overall Coordinators in writing of such pledge or
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charge together with the number of H Shares or other securities of the Company so pledged or
charged if and when he or the relevant registered holder(s) pledges or charges any H Shares or
other securities of the Company beneficially owned by him, and (b) when Prof. Li receives
indications, either verbal or written, from the pledgee or chargee of any H Shares that any of the
pledged or charged H Shares or other securities of the Company will be disposed of, he will
immediately inform the Company and the Overall Coordinators of such indications.
The Company has undertaken that, as soon as practicable upon receiving such information in
writing from Prof. Li and if required pursuant to the Listing Rules, notify the Stock Exchange and
make a public disclosure in relation to such information by way of an announcement.
Indemnity
Our Company and Prof. Li have agreed to indemnify, among others, the Joint Sponsors, the
Joint Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead
Managers, the Syndicate Capital Market Intermediaries and the Hong Kong Underwriters for
certain losses which they may suffer, including losses arising from the performance of their
obligations under the Hong Kong Underwriting Agreement and any breach by us of the Hong Kong
Underwriting Agreement, as the case may be.
Hong Kong Underwriters’ Interests in our Company
Except for its obligations under the Hong Kong Underwriting Agreement, none of the Hong
Kong Underwriters has any shareholding interest in our Company or any right or option (whether
legally enforceable or not) to subscribe for or nominate persons to subscribe for securities in our
Company.
Following the completion of the Global Offering, the Hong Kong Underwriters and their
affiliated companies may hold a certain portion of the H Shares as a result of fulfilling their
obligations under the Hong Kong Underwriting Agreement.
The International Offering
In connection with the International Offering, it is expected that the Company will enter into
the International Underwriting Agreement with the International Underwriters on December 17,
2025. Under the International Underwriting Agreement and subject to and the Over-Allotment
Option, the International Underwriters will, subject to certain conditions set out therein, severally
and not jointly, agree to subscribe for or purchase or procure subscribers or purchasers for their
respective proportions of the International Offer Shares which are not taken up under the
International Offering. See “Structure of the Global Offering — The International Offering.”
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Over-Allotment Option
The Company is expected to grant to the International Underwriters the Over-Allotment
Option, exercisable by the Overall Coordinators on behalf of the International Underwriters during
the 30-day period from the last day for lodging of applications under the Hong Kong Public
Offering, to require the Company to issue up to an aggregate of 811,190 additional Offer Shares,
representing approximately 15% of the Offer Shares initially available under the Global Offering.
It is expected that the International Underwriting Agreement may be terminated on similar grounds
as the Hong Kong Underwriting Agreement. Potential investors should note that if the International
Underwriting Agreement is not entered into, or is terminated, the Global Offering will not proceed.
See “Structure of the Global Offering — The International Offering — Over-Allotment Option.”
Commissions and Expenses
All Capital Market Intermediaries participating in the Global Offering will receive an
underwriting commission equivalent to 3% (the “ Fixed Fees ”) of the aggregate Offer Price payable
in respect of all of the Offer Shares (including any Offer Shares which may be issued pursuant to
the exercise of the Over-allotment Option) (the “ Gross Proceeds ”) and an additional discretionary
incentive fee, in the Company’s sole discretion, up to 1% (the “ Discretionary Fees ”) of the Gross
Proceeds. The ratio of Fixed Fees and Discretionary Fees payable to all Capital Market
Intermediaries is therefore 75:25. The Company has also agreed to pay China International Capital
Corporation Hong Kong Securities Limited, China Securities (International) Corporate Finance
Company Limited, and/or Ping An Securities (Hong Kong) Company Limited an additional 2%
incentive fee for any underwriting contribution exceeding the percentage of their initial
allocations.
For any unsubscribed Hong Kong Offer Shares reallocated to the International Offering, the
Company will pay the underwriting commission for such H Shares to the International
Underwriters (but not the Hong Kong Underwriters).
The aggregate amount of sponsor fee payable by the Company to the Joint Sponsors is
US$900,000.
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$113.3 million (assuming the full payment of the
Discretionary Fees and the Over-allotment Option are not fully exercised) and will be paid by the
Company.
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Over-Allotment and Stabilization
Details of the arrangements relating to the Over-Allotment Option and stabilization are set
forth in the section headed “Structure of the Global Offering.”
INDEPENDENCE OF THE JOINT SPONSORS
Save and except for Ping An of China Capital (Hong Kong) Company Limited, other Joint
Sponsors satisfy the independence criteria applicable to sponsors set out in Rule 3A.07 of the
Listing Rules.
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, brokerage, funds management, trading, hedging, investing and other
activities for their own account and for the account of others. In the ordinary course of their
various business activities, the Syndicate Members and their respective affiliates may purchase,
sell or hold a broad array of investments and actively trade securities, derivatives, loans,
commodities, currencies, credit default swaps and other financial instruments for their own account
and for the accounts of their customers. Such investment and trading activities may involve or
relate to assets, securities and/or instruments of the Company 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, those activities 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 and 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. Those activities may require hedging
activity by those entities involving, directly or indirectly, the buying and selling of the H Shares.
All such activities could occur in Hong Kong and elsewhere in the world and may result in the
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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 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:
(a) the Syndicate Members (other than the Stabilizing Manager through its affiliates or any
person acting for it) must not, in connection with the distribution of the Offer Shares,
effect any transactions (including issuing or entering into any option or other derivative
transactions relating to the Offer Shares), whether in the open market or otherwise, with
a view to stabilizing or maintaining the market price of any of the Offer Shares at levels
other than those which might otherwise prevail in the open market; and
(b) 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 and other services to us and our
affiliates for which such Syndicate Members or their respective affiliates have received or will
receive customary fees and commissions.
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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. China International Capital Corporation Hong Kong Securities Limited, China
Securities (International) Corporate Finance Company Limited and Ping An Securities (Hong
Kong) Company Limited are the Joint Overall Coordinators of the Global Offering.
5,407,980 Offer Shares will be made available under the Global Offering comprising:
(a) the Hong Kong Public Offering of 270,400 H Shares (subject to reallocation) in Hong
Kong as described in the paragraph headed “— The Hong Kong Public Offering” below;
and
(b) the International Offering of an aggregate of initially 5,137,580 H Shares (subject to
reallocation and the Over-Allotment Option) outside the United States in reliance on
Regulation S, as described in the paragraph headed “— The International Offering”
below.
Investors may either:
(a) apply for Hong Kong Offer Shares under the Hong Kong Public Offering; or
(b) 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 12.35% of the total H Shares in issue
immediately following the completion of the Global Offering, assuming and the Over-Allotment
Option is not exercised. If the Over-Allotment Option is exercised in full, the Offer Shares will
represent approximately 13.94% of the total H Shares in issue immediately following the
completion of the Global Offering and the issue of Offer Shares pursuant to the Over-allotment
Option.
THE HONG KONG PUBLIC OFFERING
Number of Offer Shares Initially Offered
The Company is initially offering 270,400 Offer Shares for subscription by the public in
Hong Kong at the Offer Price, representing approximately 5% of the total number of Offer Shares
initially available under the Global Offering. The number of Shares offered under the Hong Kong
Public Offering, subject to any adjustment of Offer Shares between the International Offering and
STRUCTURE OF THE GLOBAL OFFERING
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the Hong Kong Public Offering, will represent approximately 0.62% of the total H Shares in issue
immediately following the completion of the Global Offering, assuming the Over-Allotment Option
is not exercised.
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 which regularly invest in shares and other securities.
Completion of the Hong Kong Public Offering is subject to the conditions as set out in the
paragraph headed “— Conditions of the Global Offering” below.
Allocation
Allocation of the Offer Shares to investors under the Hong Kong Public Offering will be
based solely on the level of valid applications received under the Hong Kong Public Offering. The
basis of allocation may vary, depending on the number of Hong Kong Offer Shares validly applied
for by applicants. Such allocation could, where appropriate, consist of balloting, which would
mean that some applicants may receive a higher allocation than others who have applied for the
same number of Hong Kong Offer Shares, and those applicants who are not successful in the ballot
may not receive any Hong Kong Offer Shares.
For allocation purposes only, the total number of the Offer Shares initially available under the
Hong Kong Public Offering (after taking account of any reallocation referred to below) is to be
divided into two pools (with any odd lots being allocated to pool A), pool A and pool B. The Hong
Kong Offer Shares in pool A will be allocated on an equitable basis to valid applicants who have
applied for Hong Kong Offer Shares with an aggregate subscription price of HK$5 million
(excluding the brokerage, SFC transaction levy, Stock Exchange trading fee and AFRC transaction
levy 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 with an aggregate
subscription price of more than HK$5 million (excluding the brokerage, SFC transaction levy,
Stock Exchange trading fee and AFRC transaction levy 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
undersubscribed, 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 this
paragraph only, the “price” for the Offer Shares means the price payable on application therefore.
Applicants can only receive an allocation of Hong Kong Offer Shares from either pool A or pool B
STRUCTURE OF THE GLOBAL OFFERING
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but not from both pools. Multiple or suspected multiple applications and any application for more
than 135,200 Hong Kong Offer Shares, being 50% of the 270,400 Hong Kong Offer Shares
initially available under the Hong Kong Public Offering are liable to be rejected.
Reallocation and Clawback
The allocation of the Offer Shares between the Hong Kong Public Offering and the
International Offering is subject to reallocation. Paragraph 4.2 of Practice Note 18 and 18C.09 of
the Listing Rules requires a clawback mechanism to put in place which would have the effect of
increasing the number of Offer Shares under the Hong Kong Public Offering to a certain
percentage of the total number of Offer Shares offered under the Global Offering if certain
prescribed total demand levels are reached (“ Mandatory Reallocation ”):
in the event that the International Offer Shares are fully subscribed or oversubscribed
(a) if the number of Offer Shares validly applied for under the Hong Kong Public Offering
represents 10 times or more but less than 50 times the number of Offer Shares initially
available for subscription under the Hong Kong Public Offering, then the Offer Shares
will be reallocated to the Hong Kong Public Offering from the International Offering
such that the total number of Offer Shares initially available under the Hong Kong
Public Offering will be 540,800 Offer Shares, representing approximately 10.00% of the
Offer Shares initially available under the Global Offering; and
(b) if the number of Offer Shares validly applied for under the Hong Kong Public Offering
represents 50 times or more of Offer Shares initially available for subscription under the
Hong Kong Public Offering, then the Offer Shares will be reallocated to the Hong Kong
Public Offering from the International Offering such that the total number of Offer
Shares initially available under the Hong Kong Public Offering will be 1,081,600 Offer
Shares, representing approximately 20.00% of the Offer Shares initially available under
the Global Offering.
In each case, the additional Offer Shares reallocated to the Hong Kong Public Offering will
be allocated between pool A and pool B and the number of Offer Shares allocated to the
International Offering will be correspondingly reduced in such manner as the Sponsor-Overall
Coordinators deem appropriate.
In addition to any Mandatory Reallocation which may be required, the Overall Coordinators
(for themselves and on behalf of the Underwriters) and the Joint Sponsors may, at their discretion,
reallocate Offer Shares initially allocated for the International Offering to the Hong Kong Public
Offering to satisfy valid applications in pool A and pool B under the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
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In the event that (i) the International Offer Shares are undersubscribed and the Hong Kong Offer
Shares are fully subscribed or oversubscribed irrespective of the number of times; or (ii) the
International Offer Shares are fully subscribed or oversubscribed and the Hong Kong Offer Shares
are fully subscribed or oversubscribed as to less than 10 times of the number of Hong Kong Offer
Shares initially available under the Hong Kong Public Offering, the Overall Coordinators have the
authority to reallocate certain Offer Shares to the Hong Kong Public Offering from the
International Offering, so that the total number of the Offer Shares available under the Hong Kong
Public Offering will be increased up to 540,800 Offer Shares, representing approximately 10.00%
of the number of the 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 issued by the Stock Exchange.
The Offer Shares to be offered in the Hong Kong Public Offering and the Offer Shares to be
offered in the International Offering may, in certain circumstances, be reallocated between these
offerings at the discretion of the Overall Coordinators.
Applications
Each applicant under the Hong Kong Public Offering will also be required to give an
undertaking and confirmation in the application submitted by him that he and any person(s) for
whose benefit he is making the application have not applied for or taken up, or indicated an
interest for, and will not apply for or take up, or indicate an interest for, any Offer Shares under
the International Offering. Such applicant’s application is liable to be rejected if such undertaking
and/or confirmation is/are breached and/or untrue (as the case may be) or it has been or will be
placed or allocated International Offer Shares under the International Offering.
The listing of the H Shares on the Stock Exchange is sponsored by the Joint Sponsors.
Applicants under the Hong Kong Public Offering may be required to pay, on application (subject
to application channels), the Offer Price of HK$263.00 per Offer Share in addition to the
brokerage, SFC transaction levy, Stock Exchange trading fee and AFRC transaction levy payable
on each Offer Share.
References in this Prospectus to applications, application monies or the procedure for
application relate solely to the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
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THE INTERNATIONAL OFFERING
Number of Offer Shares Initially Offered
Subject to reallocation as described above, the International Offering will consist of an
offering of initially 5,137,580 H Shares, representing approximately 95% of the total number of
Offer Shares initially available under the Global Offering and approximately 11.73% of the total H
Shares in issue immediately after the completion of the Global Offering, assuming the
Over-Allotment Option is not exercised.
Allocation
The International Offering will include selective marketing of Offer Shares to institutional
and professional investors and other investors anticipated to have a sizeable demand for such Offer
Shares in Hong Kong and other jurisdictions outside the United States only 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 which 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 paragraph headed “— Pricing of the Global Offering” below and based on a
number of factors, including the level and timing of demand, the total size of the relevant
investor’s invested assets or equity assets in the relevant sector and whether or not it is expected
that the relevant investor is likely to buy further Offer Shares, and/or hold or sell its Offer Shares,
after the Listing. Such allocation is intended to result in a distribution of the Offer Shares on a
basis which would lead to the establishment of a solid professional and institutional shareholder
base to the benefit of the Company and the Shareholders as a whole. In addition, pursuant to Rule
18C.08 of the Listing Rules, at least 50% of the total number of shares offered in the Global
Offering (excluding any shares to be issued pursuant to the exercise of the Over-allotment Option)
will be taken up by independent price setting investors, as defined under the Listing Rules, in the
International Offering.
The Joint Overall Coordinators (on behalf of the Underwriters) may require any investor who
has been offered the Offer Shares under the International Offering, and who has made an
application under the Hong Kong Public Offering to provide sufficient information to the Joint
Overall Coordinators so as to allow them to identify the relevant application under the Hong Kong
Public Offering and to ensure that it is excluded from any application of Offer Shares under the
International Offering.
STRUCTURE OF THE GLOBAL OFFERING
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Reallocation and Clawback
The total number of Offer Shares to be issued or sold pursuant to the International Offering
may change as a result of, amongst others, the clawback arrangement described in the paragraph
headed “— The Hong Kong Public Offering — Reallocation and Clawback” above, the exercise of
the Over-Allotment Option in whole or in part and/or any reallocation of unsubscribed Offer
Shares originally included in the Hong Kong Public Offering.
Over-Allotment Option
In connection with the Global Offering, the Company is expected to grant an Over-Allotment
Option to the International Underwriters exercisable by the Overall Coordinators on behalf of the
International Underwriters.
Pursuant to the Over-Allotment Option, the International Underwriters have the right,
exercisable by the Overall Coordinators (on behalf of the International Underwriters) at any time
from the Listing Date until 30 days after the last date for the lodging of applications under the
Hong Kong Public Offering, to require the Company to issue up to an aggregate of 811,190
additional Offer Shares, representing approximately 15% of the 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, the additional Offer Shares to be issued
pursuant thereto will represent approximately 1.82% of our issued share capital immediately
following the completion of the Global Offering and the exercise of the Over-allotment Option. In
the event that the Over-Allotment Option is exercised, an announcement will be made.
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 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 through its affiliates or any
person acting for it, on behalf of the Underwriters, may over-allocate or effect short sales or any
other stabilizing transactions with a view to stabilizing or maintaining the market price of the H
STRUCTURE OF THE GLOBAL OFFERING
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--- page 495 ---
Shares for a limited period after the Listing Date at a level higher than that which might otherwise
prevail in the open market. Short sales involve the sale by the Stabilizing Manager through its
affiliates of a greater number of H Shares than the Underwriters are required to purchase in the
Global Offering. “Covered” short sales are sales made in an amount not greater than the
Over-Allotment Option. The Stabilizing Manager through its affiliates may close out the covered
short position by either exercising the Over-Allotment Option to purchase additional H Shares or
purchasing H Shares in the open market. In determining the source of the H Shares to close out the
covered short position, the Stabilizing Manager through its affiliates will consider, among others,
the price of H Shares in the open market as compared to the price at which they may purchase
additional H Shares pursuant to the Over-Allotment Option. Stabilizing transactions consist of
certain bids or purchases made for the purpose of preventing or retarding a decline in the market
price of the H Shares while the Global Offering is in progress. Any market purchases of the H
Shares may be effected on any stock exchange, including the Stock Exchange, any
over-the-counter market or otherwise, provided that they are made in compliance with all
applicable laws and regulatory requirements. However, there is no obligation on the Stabilizing
Manager through its affiliates or any person acting for it to conduct any such stabilizing action,
which if taken, (a) will be conducted at the absolute discretion of the Stabilizing Manager through
its affiliates or any person acting for it, (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 the lodging of applications under the
Hong Kong Public Offering. The number of the H Shares that may be over-allocated will not
exceed the number of the H Shares that may be sold and transferred pursuant to the exercise of the
Over-Allotment Option, namely, 811,190 Offer Shares, which is approximately 15% of the number
of Offer Shares initially available under the Global Offering, in the event that the whole or part of
the Over-Allotment Option is exercised.
In Hong Kong, stabilizing activities must be carried out in accordance with the Securities and
Futures (Price Stabilizing) Rules. Stabilizing actions permitted pursuant to the Securities and
Futures (Price Stabilizing) Rules include:
(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) subscribing, or agreeing to subscribe, for the H Shares to be sold and transferred
pursuant to the exercise of the Over-Allotment Option in order to close out any position
established under (a) or (b) above;
STRUCTURE OF THE GLOBAL OFFERING
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--- page 496 ---
(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 to liquidate any position established as a result
of those purchases; and
(f) offering or attempting to do anything described in (b), (c), (d) and (e) above.
Stabilizing actions by the Stabilizing Manager through its affiliates, or any person acting for
it, will be entered into in accordance with the laws, rules and regulations in place in Hong Kong
on stabilization.
Prospective applications for investors in the Offer Shares should note that:
(a) as a result of effecting transactions to stabilize or maintain the market price of the H
Shares, the Stabilizing Manager through its affiliates, or any person acting for it, may
maintain a long position in the H Shares;
(b) the size of the long position, and the period for which the Stabilizing Manager through
its affiliates, or any person acting for it, will maintain the long position is at the
discretion of the Stabilizing Manager through its affiliates and is uncertain;
(c) liquidation of any such long position by the Stabilizing Manager through its affiliates
and selling in the open market may lead to a decline in the market price of the H
Shares;
(d) no stabilizing action can be taken to support the price of the H Shares for longer than
the stabilizing period, which begins on the Listing Date, and is expected to expire on
Thursday, January 15, 2026, being the 30th day after the last day for the lodging of
applications under the Hong Kong Public Offering. After this date, when no further
stabilizing action may be taken, demand for the H Shares, and their market price, could
fall after the end of the stabilizing period. These activities by the Stabilizing Manager
through its affiliates may stabilize, maintain or otherwise affect the market price of the
H Shares. As a result, the price of the H Shares may be higher than the price that
otherwise may exist in the open market;
(e) any stabilizing action taken by the Stabilizing Manager through its affiliates, or any
person acting for it, may not necessarily result in the market price of the H Shares
staying at or above the Offer Price either during or after the stabilizing period; and
STRUCTURE OF THE GLOBAL OFFERING
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--- page 497 ---
(f) stabilizing bids or transactions effected in the course of the stabilizing action may be
made at a price at or below the Offer Price and therefore at or below the price paid by
applicants for, or investors in, the Offer Shares.
An announcement in compliance with the Securities and Futures (Price Stabilizing) Rules will
be made within seven days of the expiration of the stabilizing period.
PRICING OF THE GLOBAL OFFERING
The International Underwriters will be soliciting from prospective investor indications of
interest in acquiring International Offer Shares in the International Offering. Prospective
professional and institutional investors will be required to specify the number of International
Offer Shares under the International Offering they would be prepared to acquire either at different
prices or at a particular price. This process, known as “book-building,” is expected to continue up
to, and to cease on or around, the last day for lodging applications under the Hong Kong Public
Offering.
The Offer Price will be HK$263.00 per Offer Share unless otherwise announced.
The Overall Coordinators, on behalf of the Underwriters, may, where considered appropriate,
based on the level of interest expressed by prospective professional and institutional investors
during the book-building process, and with the consent of the Company, reduce the number of
Offer Shares offered in the Global Offering that stated in this Prospectus at any time on or prior to
the morning of the last day for lodging applications under the Hong Kong Public Offering. In such
a case, 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 day which is the last day for lodging
applications under the Hong Kong Public Offering, cause to be posted on the website of the Stock
Exchange ( www.hkexnews.hk
) and on the website of the Company ( www.cidi.ai ) notices of the
reduction. Upon issue of such a notice, the number of Offer Shares offered in the Global Offering
will be final and conclusive. Such notice will also include confirmation or revision, as appropriate,
of the working capital statement and the Global Offering statistics as currently set out in the
prospectus and any other financial information which may change materially as a result of such
reduction. 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.
STRUCTURE OF THE GLOBAL OFFERING
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Applicants should have regard to the possibility that any announcement of a reduction in the
number of Offer Shares being offered under the Global Offering 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 published, the number of Offer Shares will not be reduced.
In the event of a reduction in the number of Offer Shares, the Overall Coordinators (for
themselves and on behalf of the Underwriters) may, at their discretion, reallocate the number of
Offer Shares to be offered in the Hong Kong Public Offering and the International Offering. The
Offer Shares to be offered in the Hong Kong Public Offering and the Offer Shares to be offered in
the International Offering may, in certain circumstances, be reallocated between these offerings at
the discretion of the Overall Coordinators (for themselves and on behalf of the Underwriters).
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 allocation in the Hong Kong Public Offering are expected to be announced on Thursday,
December 18, 2025 through a variety of channels in the manner described in the section headed
“How to apply for Hong Kong Offer Shares — B. Publication of Results.”
HONG KONG UNDERWRITING AGREEMENT
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters under
the terms of the Hong Kong Underwriting Agreement and is conditional upon the International
Underwriting Agreement being signed and becoming unconditional.
Our Company expects to enter into the International Underwriting Agreement relating to the
International Offering on or around December 17, 2025.
These underwriting arrangements, and the respective Underwriting Agreements, are
summarized in the section headed “Underwriting.”
H SHARES WILL BE ELIGIBLE FOR CCASS
All necessary arrangements have been made enabling the H Shares to be admitted into
CCASS. If the Stock Exchange grants the listing of, and permission to deal in, the H Shares and
our Company complies with the stock admission requirements of HKSCC, the H Shares will be
accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with
effect from the date of commencement of dealings in the H Shares on the Stock Exchange or any
other date HKSCC chooses. Settlement of transactions between participants of the Stock Exchange
is required to take place in CCASS on the second settlement day after any trading day.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 499 ---
All activities under CCASS are subject to the General Rules of HKSCC and HKSCC
Operational Procedures in effect from time to time.
CONDITIONS OF THE GLOBAL OFFERING
Acceptance of all applications for Offer Shares will be conditional on:
(i) the Stock Exchange granting approval for the listing of, and permission to deal in, the H
Shares to be converted from Domestic Unlisted Shares and to be issued pursuant to the
Global Offering and such approval not having been withdrawn;
(ii) the execution and delivery of the International Underwriting Agreement on or around
December 17, 2025; and
(iii) the obligations of the Underwriters under each of the respective Underwriting
Agreements becoming and remaining unconditional and not having been terminated in
accordance with the terms of the respective agreements.
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.
The consummation of each of the Hong Kong Public Offering and the International Offering
is conditional upon, among other things, the other offering becoming unconditional and not having
been terminated in accordance with its terms.
If the above conditions are not fulfilled or waived prior to the times and dates specified, the
Global Offering will lapse and the Stock Exchange will be notified immediately. Notice of the
lapse of the Hong Kong Public Offering will be published by the Company on the website of the
Stock Exchange ( www.hkexnews.hk
) and the website of the Company ( www.cidi.ai ) on the next
day following such lapse. In such event, all application monies will be returned, without interest,
on the terms set out in the section headed “How to apply for Hong Kong Offer Shares.” In the
meantime, all application monies will be held in (a) separate bank account(s) with the receiving
banker or other licensed bank(s) in Hong Kong licensed under the Banking Ordinance (Chapter
155 of the Laws of Hong Kong) (as amended).
STRUCTURE OF THE GLOBAL OFFERING
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--- page 500 ---
H Share certificates for the Offer Shares only become valid evidence of title at 8:00 a.m. on
Friday, December 19, 2025 provided that (i) the Global Offering has become unconditional in all
respects and (ii) the right of termination as described in the section headed “Underwriting —
Underwriting arrangements and expenses — The Hong Kong Public Offering — Grounds for
Termination” has not been exercised at or before that time.
DEALING 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, December 19, 2025, it is expected that dealings in the H Shares on the
Stock Exchange will commence at 9:00 a.m. on Friday, December 19, 2025. The H Shares will be
traded in board lots of 10 H Shares each and the stock code of the H Shares will be 3881.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 501 ---
IMPORTANT NOTICE TO INVESTORS
OF HONG KONG OFFER SHARES
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong Public
Offering and below are the procedures for application.
This prospectus is available at the website of the Stock Exchange at
www.hkexnews.hk under the “HKEXnews > New Listings > New Listing Information”
section, and our website at www.cidi.ai .
The contents of this prospectus are identical to the prospectus as registered with the
Registrar of Companies in Hong Kong pursuant to Section 342C of the Companies (Winding Up
and Miscellaneous Provisions) Ordinance.
A. APPLICATION FOR HONG KONG OFFER SHARES
1. Who Can Apply
You can apply for Hong Kong Offer Shares if you or the person(s) for whose benefit you are
applying for:
 are 18 years of age or older; and
 have a Hong Kong address (for the HK eIPO White Form service only).
Unless permitted by the Listing Rules or a waiver and/or consent has been granted by the
Stock Exchange to us, you cannot apply for any Hong Kong Offer Shares if you or the person(s)
for whose benefit you are applying for:
 are an existing Shareholder or close associates;
 are a Director, a supervisor of the Company or any of his/her close associates; or
 have been allocated or have applied for any International Offer Shares or otherwise
participate in the International Offering.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 502 ---
2. Application Channels
The Hong Kong Public Offering period will begin at 9:00 a.m. on Thursday, December
11, 2025 and end at Tuesday, December 16, 2025 (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 service
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,
December 11, 2025 to 11:30
a.m. on Tuesday, December
16, 2025, Hong Kong time.
The latest time for
completing full payment of
application monies will be
12:00 noon on Tuesday,
December 16, 2025, Hong
Kong time.
HKSCC EIPO
channel
Your broker or custodian who
is a HKSCC Participant will
submit an EIPO application
on your behalf through
HKSCC’s FINI system in
accordance with your
instruction
Applicants who would not like
to receive a physical H
Share certificate. Hong
Kong Offer Shares
successfully applied for will
be allotted and issued in the
name of HKSCC Nominees,
deposited directly into
CCASS and credited to your
designated HKSCC
Participant’s stock account.
Contact your broker or
custodian for the earliest
and latest time for giving
such instructions, as this
may vary by broker or
custodian.
The 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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 503 ---
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 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 HK eIPO White Form
service.
By instructing your broker or custodian to apply for the Hong Kong Offer Shares on your
behalf through the HKSCC EIPO Channel, you (and, if you are joint applicants, each of you
jointly and severally) are deemed to have instructed and authorized HKSCC to cause HKSCC
Nominees (acting as nominee for the relevant HKSCC Participants) to apply for Hong Kong Offer
Shares on your behalf and to do on your behalf all the things stated in this prospectus and any
supplement to it.
For those applying through HKSCC EIPO channel, an actual application will be deemed to
have been made for any application instructions given by you or for your benefit to HKSCC (in
which case an application will be made by HKSCC Nominees on your behalf) provided such
application instruction has not been withdrawn or otherwise invalidated before the closing time of
the Hong Kong Public Offering.
HKSCC Nominees will only be acting as a nominee for you and neither HKSCC nor HKSCC
Nominees shall be liable to you or any other person in respect of any actions taken by HKSCC or
HKSCC Nominees on your behalf to apply for Hong Kong Offer Shares or for any breach of the
terms and conditions of this prospectus.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 504 ---
3. Information Required to Apply
You must provide the following information with your application:
For Individual/Joint Applicants For Corporate Applicants
 Full name(s)
2 as shown on your
identity document
 Identity document’s issuing country or
jurisdiction
 Identity document type, with order of
priority:
i. HKID card; or
ii. National identification document;
or
iii. Passport; and
 Identity document number
 Full name(s)
2 as shown on your
identity document
 Identity document’s issuing country or
jurisdiction
 Identity document type, with order of
priority:
i. Legal entity identifier (“ LEI”)
registration document; or
ii. Certificate of incorporation; or
iii. Business registration certificate; or
iv. Other equivalent document; and
 Identity document number
Notes:
1. If you are applying through the 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 shares in a public offer. Similarly for corporate
applicants, a LEI number must be used if an entity has a LEI certificate.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 505 ---
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, we and the Joint Overall Coordinators, as our agent, have discretion to consider
whether to accept it on any conditions we think fit, including evidence of the attorney’s authority.
Failing to provide any required information may result in your application being rejected.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 506 ---
4. Permitted Number of Hong Kong Offer Shares for Application
Board lot size 10
Permitted number of Hong Kong
Offer Shares for application
and amount payable on
application/successful allotment
Hong Kong Offer Shares are available for application
in specified board lot sizes only. Please refer to the
amount payable associated with each specified board
lot size in the table below.
The Offer Price is HK$263.00 per Share.
If you are applying through the HKSCC EIPO
channel, your broker or custodian may require you to
pre-fund your application, in such amount as
determined by the broker or custodian, based on the
applicable laws and regulations in Hong Kong. You
are responsible for complying with any such
pre-funding requirement imposed by your broker or
custodian with respect to the Hong Kong Offer Shares
you applied for.
By instructing your broker or custodian to apply for
the Hong Kong Offer Shares on your behalf through
the HKSCC EIPO Channel, you (and, if you are joint
applicants, each of you jointly and severally) are
deemed to have instructed and authorized HKSCC to
cause HKSCC Nominees (acting as nominee for the
relevant HKSCC Participants) to arrange payment of
the Offer Price, brokerage, SFC transaction levy, the
Stock Exchange trading fee and the AFRC transaction
levy by debiting the relevant nominee bank account at
the Designated Bank for your broker or custodian.
If you are applying through the HK eIPO White
Form service, you may refer to the table below for
the amount payable for the number of H Shares you
have selected. You must pay the respective amount
payable on application in full upon application for
Hong Kong Offer Shares.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 507 ---
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application/
successful allotment
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application/
successful allotment
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application/
successful allotment
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application/
successful allotment
HK$ HK$ HK$ HK$
10 2,656.52 250 66,413.09 3,000 796,957.06 60,000 15,939,141.30
20 5,313.05 300 79,695.71 4,000 1,062,609.42 70,000 18,595,664.86
30 7,969.57 350 92,978.33 5,000 1,328,261.78 80,000 21,252,188.40
40 10,626.09 400 106,260.94 6,000 1,593,914.14 90,000 23,908,711.96
50 13,282.62 450 119,543.57 7,000 1,859,566.49 100,000 26,565,235.50
60 15,939.14 500 132,826.18 8,000 2,125,218.85 110,000 29,221,759.06
70 18,595.67 600 159,391.42 9,000 2,390,871.20 120,000 31,878,282.60
80 21,252.19 700 185,956.65 10,000 2,656,523.56 135,200
(1) 35,916,198.40
90 23,908.72 800 212,521.89 20,000 5,313,047.10
100 26,565.24 900 239,087.12 30,000 7,969,570.66
150 39,847.86 1,000 265,652.35 40,000 10,626,094.20
200 53,130.47 2,000 531,304.71 50,000 13,282,617.76
Notes:
(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.
No application for any other number of the Hong Kong Offer Shares will be considered and
any such application is liable to be rejected.
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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 508 ---
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.
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 authorise us and/or the
Joint Overall Coordinators, as our agents, to execute any documents for you and to do
on your behalf all things necessary to register any Hong Kong Offer Shares allocated to
you in your name or in the name of HKSCC Nominees as required by the Articles of
Association, and (if you are applying through the HKSCC EIPO channel) to deposit the
allotted Hong Kong Offer Shares directly into CCASS for the credit of your designated
HKSCC Participant’s stock account on your behalf;
(ii) confirm that you have read and understand the terms and conditions and application
procedures set out in this prospectus and the designated website of the 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;
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 498 –


--- page 509 ---
(iv) confirm that you are aware of the restrictions on offers and sales of shares set out in this
prospectus and they do not apply to you, or the person(s) for whose benefit you have
made the application;
(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 Joint Sponsors, the Joint Overall Coordinators, the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market
Intermediaries, the Underwriters, their respective directors, officers, employees,
partners, agents, advisors 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 us, the Relevant Persons, the H Share Registrar, HKSCC,
HKSCC Nominees, the Stock Exchange, the SFC and any other statutory regulatory or
governmental bodies or otherwise as required by laws, rules or regulations, for the
purposes under the paragraph headed “— G. Personal Data — 3. Purposes and 4.
Transfer of personal data” in this section;
(viii) agree (without prejudice to any other rights which you may have once your application
(or as the case may be, HKSCC Nominees’ application) has been accepted) that you will
not rescind it because of an innocent misrepresentation;
(ix) agree that subject to Section 44A(6) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance, any application made by you or HKSCC Nominees on your
behalf cannot be revoked once it is accepted, which will be evidenced by the
notification of the result of the ballot by the H Share Registrar by way of publication of
the results at the time and in the manner as specified in the paragraph headed “— B.
Publication of Results” in this section;
(x) confirm that you are aware of the situations specified in the paragraph headed “— C.
Circumstances In Which You Will Not Be Allocated Hong Kong Offer Shares” in this
section;
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 499 –


--- page 510 ---
(xi) agree that your application or HKSCC Nominees’ application, any acceptance of it and
the resulting contract will be governed by and construed in accordance with the laws of
Hong Kong;
(xii) agree to comply with the Companies Ordinance, the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, the Articles of Association and laws of any place
outside Hong Kong that apply to your application and that neither we nor the Relevant
Persons will breach any law inside and/or outside Hong Kong as a result of the
acceptance of your offer to purchase, or any action arising from your rights and
obligations under the terms and conditions contained in this prospectus;
(xiii) confirm that (a) your application or HKSCC Nominees’ application on your behalf is not
financed directly or indirectly by the Company, any of the directors, chief executives,
substantial Shareholder(s) or existing shareholder(s) of the Company or any of its
subsidiaries or any of their respective close associates; and (b) you are not accustomed
or will not be accustomed to taking instructions from the Company, any of the directors,
chief executives, substantial shareholder(s) or existing shareholder(s) of the Company or
any of its subsidiaries or any of their respective close associates in relation to the
acquisition, disposal, voting or other disposition of the H Shares registered in your name
or otherwise held by you;
(xiv) warrant that the information you have provided is true and accurate;
(xv) confirm that you understand that we and the Joint Overall Coordinators 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
– 500 –


--- page 511 ---
(xix) (if you are making the application as an agent for the benefit of another person) warrant
that (1) no other application has been or will be made by you as agent for or for the
benefit of that person or by that person or by any other person as agent for that person
by giving electronic application instructions to HKSCC and 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 at
www.hkeipo.hk/IPOResult (or
www.tricor.com.hk/ipo/result ) with
a “search by ID” function.
24 hours, from 11:00 p.m. on
Thursday, December 18,
2025 to 12:00 midnight on
Wednesday, December 24,
2025 (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.hkeipo.hk/IPOResult
or
www.tricor.com.hk/ipo/result .
The Stock Exchange’s website at
www.hkexnews.hk and our website
at www.cidi.ai which will provide
links to the above mentioned
websites of the H Share Registrar.
No later than 11:00 p.m. on
Thursday, December 18,
2025 (Hong Kong time)
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 501 –


--- page 512 ---
Platform Date/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., Friday, December 19,
2025 to Wednesday,
December 24, 2025 (Hong
Kong time) on a business
day
For those applying through HKSCC EIPO channel, you may also check with your broker or
custodian from 6:00 p.m. on Wednesday, December 17, 2025 (Hong Kong time)
HKSCC Participants can log into FINI and review the allotment result from 6:00 p.m. on
Wednesday, December 17, 2025 (Hong Kong time) on a 24-hour basis and should report any
discrepancies on allotments to HKSCC as soon as practicable.
Allocation Announcement
We expect to announce the results of the level of indications of interest in the Global Offer,
the level of applications in the Hong Kong Public Offering and the basis of allocations of Hong
Kong Offer Shares on the Stock Exchange’s website at www.hkexnews.hk
and our website at
www.cidi.ai by no later than 11:00 p.m. on Thursday, December 18, 2025 (Hong Kong time).
C. CIRCUMSTANCES IN WHICH YOU WILL NOT BE ALLOCATED HONG KONG
OFFER SHARES
You should note the following situations in which Hong Kong Offer Shares will not be
allocated to you or the person(s) for whose benefit you are applying for:
1. If your application is revoked:
Your application or the application made by HKSCC Nominees on your behalf may be
revoked pursuant to Section 44A(6) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance.
2. If we or our agents exercise our discretion to reject your application:
We, the Joint Overall Coordinators, 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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 502 –


--- page 513 ---
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
 within a longer period of up to six weeks if the Stock Exchange notifies us of that
longer period within three weeks of the closing date of the application lists.
4. If:
 you make multiple applications or suspected multiple applications. You may refer to the
paragraph headed “— A. Applications for Hong Kong Offer Shares — 5. Multiple
Applications Prohibited” in this section on what constitutes multiple applications;
 your application instruction is incomplete;
 your payment (or confirmation of funds, as the case may be) is not made correctly;
 the Underwriting Agreements do not become unconditional or are terminated;
 we or the Joint Overall Coordinators believe that by accepting your application, it or we
would violate applicable securities or other laws, rules or regulations.
5. If there is money settlement failure for allotted H Shares:
Based on the arrangements between HKSCC Participants and HKSCC, HKSCC Participants
will be required to hold sufficient application funds on deposit with their Designated Bank before
balloting. After balloting of Hong Kong Offer Shares, the Receiving 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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 503 –


--- page 514 ---
There is a risk of money settlement failure. In the extreme event of money settlement
failure by a HKSCC Participant (or its Designated Bank), who is acting on your behalf in settling
payment for your allotted shares, HKSCC will contact the defaulting HKSCC Participant and its
Designated Bank to determine the cause of failure and request such defaulting HKSCC Participant
to rectify or procure to rectify the failure.
However, if it is determined that such settlement obligation cannot be met, the affected Hong
Kong Offer Shares will be reallocated to the Global Offer. Hong Kong Offer Shares applied for by
you through the broker or custodian may be affected to the extent of the settlement failure. In the
extreme case, you will not be allocated any Hong Kong Offer Shares due to the money settlement
failure by such HKSCC Participant. None of us, the Relevant Persons, the H Share Registrar and
HKSCC is or will be liable if Hong Kong Offer Shares are not allocated to you due to the money
settlement failure.
D. DESPATCH/COLLECTION OF H SHARE CERTIFICATES AND REFUND OF
APPLICATION MONIES
You will receive one H Share certificate for all Hong Kong Offer Shares allotted to you under
the Hong Kong Public Offering (except pursuant to applications made through the HKSCC EIPO
channel where the H Share certificates will be deposited into CCASS as described below).
No temporary document of title will be issued in respect of the H Shares. No receipt will be
issued for sums paid on application.
H Share certificates will only become valid evidence of title at 8:00 a.m. on Friday,
December 19, 2025 (Hong Kong time), provided that the Global Offer has become unconditional
and the right of termination described in the section headed “Underwriting” has not been
exercised. Investors who trade H Shares prior to the receipt of H Share certificates or the H Share
certificates becoming valid 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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 504 –


--- page 515 ---
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
100,000 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. No
action by you is requiredTime: from 9:00 a.m. to 1:00
p.m. on Friday, December 19,
2025 (Hong Kong time)
If you are an individual, you must
not authorise any other person
to collect for you. If you are a
corporate applicant, your
authorised representative must
bear a letter of authorization
from your corporation stamped
with your corporation’s chop.
Both individuals and authorised
representatives must produce, at
the time of collection, evidence
of identity acceptable to the H
Share Registrar.
Note: If you do not collect your
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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 505 –


--- page 516 ---
HK eIPO White Form service HKSCC EIPO channel
For application of less
than 100,000
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, December 18,
2025
Refund mechanism for surplus application monies paid by you
Date ............... Friday, December 19, 2025 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
Application monies
paid through
multiple bank
accounts ..........
Refund cheque(s) will be
despatched to in favour of the
applicant (or, in the case of
joint applications, the
first-named applicant) the
address as specified in your
application instructions by
ordinary post at your own risk.
(1) Except in the event of Bad Weather Signals (as defined below) in force in Hong Kong in the morning on Thursday,
December 18, 2025 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. Bad Weather Arrangements” in this section.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 517 ---
E. BAD WEATHER ARRANGEMENTS
The Opening and Closing of the Application Lists
The application lists will not open or close on Tuesday, December 16, 2025 if, there is:
 a tropical cyclone warning signal number 8 or above;
 a black rainstorm warning; and/or
 Extreme Conditions,
(collectively, “ Bad Weather Signals ”),
in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Tuesday, December 16,
2025.
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 Bad Weather Signals in force at any time between 9:00
a.m. and 12:00 noon.
Prospective investors should be aware that a postponement of the opening/closing of the
application lists may result in a delay in the listing date. Should there be any changes to the dates
mentioned in the section headed “Expected Timetable” in this prospectus, an announcement will be
made and published on the Stock Exchange’s website at www.hkexnews.hk
and our website at
www.cidi.ai of the revised timetable.
If a Bad Weather Signal is hoisted on Thursday, December 18, 2025, 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, December 19,
2025.
If a Bad Weather Signal is hoisted on Thursday, December 18, 2025, for application of less
than 100,000 Hong Kong Offer Shares, the despatch of physical H Share certificate(s) will be
made by ordinary post when the post office re-opens after the Bad Weather Signal is lowered or
cancelled (e.g. in the afternoon of Thursday, December 18, 2025 or on Friday, December 19, 2025.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 518 ---
If a Bad Weather Signal is hoisted on Friday, December 19, 2025, for application of 100,000
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 Bad Weather Signal is lowered or cancelled (e.g.
in the afternoon of Friday, December 19, 2025 or on Monday, December 22, 2025).
Prospective investors should be aware that if they choose to receive physical H Share
certificates issued in their own name, there may be a delay in receiving the H Share
certificates.
F. ADMISSION OF THE H SHARES INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the H Shares on the
Stock Exchange and we comply with the stock admission requirements of HKSCC, the H Shares
will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS
with effect from the date of commencement of dealings in the H Shares or any other date HKSCC
chooses. Settlement of transactions between Exchange Participants is required to take place in
CCASS on the second settlement day after any trading day.
All activities under CCASS are subject to the General Rules of HKSCC and HKSCC
Operational Procedures in effect from time to time.
All necessary arrangements have been made enabling the H Shares to be admitted into
CCASS.
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 agree to all of the terms of the Personal Information Collection Statement below.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 508 –


--- page 519 ---
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 cheque 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 Shares
including, where applicable, HKSCC Nominees;
 maintaining or updating the register of members of the Company;
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 509 –


--- page 520 ---
 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
overseas principal share registrar;
 HKSCC or HKSCC Nominees, who will use the personal data and may transfer the
personal data to the H Share Registrar, 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 operation;
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 510 –


--- page 521 ---
 the Stock Exchange, the SFC and any other statutory regulatory or governmental bodies
or otherwise as required by laws, rules or regulations, including for the purpose of the
Stock Exchange’s administration of the Listing Rules and the SFC’s performance of its
statutory functions; and
 any persons or institutions with which the holders of Hong Kong Offer Shares have or
propose to have dealings, such as their bankers, solicitors, accountants or brokers etc.
5. Retention of personal data
The Company and the H Share Registrar will keep the personal data of the applicants and
holders of Hong Kong Offer Shares for as long as necessary to fulfil the purposes for which the
personal data were collected. Personal data which is no longer required will be destroyed or dealt
with in accordance with the Personal Data (Privacy) Ordinance (Chapter 486 of the Laws of Hong
Kong).
6. Access to and correction of personal data
Applicants for and holders of Hong Kong Offer Shares have the right to ascertain whether the
Company or the H Share Registrar hold their personal data, to obtain a copy of that data, and to
correct any data that is inaccurate. The Company and the H Share Registrar have the right to
charge a reasonable fee for the processing of such requests. All requests for access to data or
correction of data should be addressed to the Company and the H Share Registrar, at their
registered address disclosed in the section headed “Corporate Information” in this prospectus or as
notified from time to time, for the attention of the company secretary, or the H Share Registrar for
the attention of the privacy compliance officer.
HOW TO APPLY FOR HONG KONG OFFER SHARES
–5 1 1–


--- page 522 ---
The following is the text of a report set out on pages I-1 to I-142, received from the
Company’ s reporting accountants, BDO Limited, Certified Public Accountants, Hong Kong, for the
purpose of incorporation in this prospectus. It is prepared and addressed to the directors of the
Company and to the Joint Sponsors pursuant to the requirements of 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.
ACCOUNTANTS’ REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE
DIRECTORS OF CiDi INC. AND CHINA INTERNATIONAL CAPITAL CORPORATION
HONG KONG SECURITIES LIMITED, CHINA SECURITIES (INTERNATIONAL)
CORPORATE FINANCE COMPANY LIMITED AND PING AN OF CHINA CAPITAL
(HONG KONG) COMPANY LIMITED
Introduction
We report on the historical financial information of CiDi Inc. (the “ Company ”) and its
subsidiaries (together, the “ Group ”) set out on pages I-5 to I-142, which comprises the
consolidated statements of financial position as at 31 December 2022, 31 December 2023 and 31
December 2024 and 30 June 2025, and the statements of financial position of the Company as at
31 December 2022, 31 December 2023 and 31 December 2024 and 30 June 2025, and the
consolidated statements of profit or loss and other comprehensive income, the consolidated
statements of changes in equity and the consolidated statements of cash flows for each of the
periods then ended (the “ Track Record Period ”) and material accounting policy information and
other explanatory information (together the “ Historical Financial Information ”). The Historical
Financial Information set out on pages I-5 to I-142 forms an integral part of this report, which has
been prepared for inclusion in the prospectus of the Company dated 11 December 2025 (the
“Prospectus ”) in connection with the initial listing of shares of the Company on the Main Board
of The Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”).
APPENDIX I ACCOUNTANTS’ REPORT
– I-1 –


--- page 523 ---
Directors’ responsibility for the Historical Financial Information
The directors of the Company are responsible for the preparation of Historical Financial
Information that gives a true and fair view in accordance with the basis of preparation 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 Historical Financial Information that is free
from material misstatement, whether due to fraud or error.
Reporting accountants’ responsibility
Our responsibility is to express an opinion on the Historical Financial Information and to
report our opinion to you. We conducted our work in accordance with Hong Kong Standard on
Investment Circular Reporting Engagements 200 “Accountants’ Reports on Historical Financial
Information in Investment Circulars” issued by the Hong Kong Institute of Certified Public
Accountants (“ HKICPA”). This standard requires that we comply with ethical standards and plan
and perform our work to obtain reasonable assurance about whether the Historical Financial
Information is free from material misstatement.
Our work involved performing procedures to obtain evidence about the amounts and
disclosures in the Historical Financial Information. The procedures selected depend on the
reporting accountants’ 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 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.
APPENDIX I ACCOUNTANTS’ REPORT
– I-2 –


--- page 524 ---
Opinion
In our opinion the Historical Financial Information gives, for the purposes of the accountants’
report, a true and fair view of the Company’s financial position as at 31 December 2022, 31
December 2023 and 31 December 2024 and 30 June 2025, the Group’s financial position as at 31
December 2022, 31 December 2023 and 31 December 2024 and 30 June 2025 and of the Group’s
financial performance and cash flows for the Track Record Period in accordance with the basis of
preparation set out in Note 2.1 to the Historical Financial Information.
Review of stub period comparative historical financial information
We have reviewed the stub period comparative historical financial information of the Group
which comprises the consolidated statement of profit or loss and other comprehensive income, the
consolidated statement of changes in equity and the consolidated statement of cash flows for the
six months ended 30 June 2024 and other explanatory information (together the “ Stub Period
Comparative Historical Financial Information ”). The directors of the Company are responsible
for the preparation of the Stub Period Comparative Historical 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 Stub Period Comparative Historical Financial
Information based on our review. We conducted our review in accordance with International
Standard on Review Engagements 2410 “Review of Interim Financial Information Performed by
the Independent Auditor of the Entity”. A review consists of making inquiries, 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
International 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 Stub Period Comparative Historical 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.
APPENDIX I ACCOUNTANTS’ REPORT
– I-3 –


--- page 525 ---
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 and the Stub Period Comparative Historical
Financial Information, no adjustments to the Underlying Financial Statements as defined on page
I-5 have been made.
Dividends
We refer to Note 41 to the Historical Financial Information which states that no dividends
have been paid by the Company in respect of the Track Record Period.
BDO Limited
Certified Public Accountants
Lam Tsz Ka
Practising Certificate no. P06838
Hong Kong
11 December 2025
APPENDIX I ACCOUNTANTS’ REPORT
– I-4 –


--- page 526 ---
I HISTORICAL FINANCIAL INFORMATION OF THE GROUP
Preparation of Historical Financial Information
Set out below is the Historical Financial Information which forms an integral part of this
accountants’ report.
The consolidated financial statements of the Group for the Track Record Period, on which the
Historical Financial Information is based, were audited by BDO Limited in accordance with
International Standards on Auditing issued by the International Auditing and Assurance Standards
Board (“ 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-5 –


--- page 527 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
Y ear ended 31 December Six months ended 30 June
Notes 2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Revenue ......................... 6 31,056 132,604 410,035 258,461 408,036
Cost of sales ...................... 7 (37,051) (105,781) (308,595) (214,082) (338,328)
Gross (loss)/profit ................... (5,995) 26,823 101,440 44,379 69,708
Other income ...................... 9 7,406 11,199 7,455 5,798 861
Other gains/(losses), net ................ 10 115 801 (19) (102) 401
Impairment losses .................... 11 (5,092) 3,589 (29,038) (5,280) (84,280)
Selling expenses .................... 7 (23,148) (31,404) (64,439) (23,611) (44,288)
General and administrative expenses .......... 7 (68,969) (97,827) (300,721) (56,070) (199,678)
Research and development expenses .......... 7 (110,507) (90,396) (193,181) (35,339) (151,317)
Operating loss ..................... (206,190) (177,215) (478,503) (70,225) (408,593)
Finance income ..................... 12 8,958 8,179 5,063 3,372 2,267
Finance costs ...................... 12 (105,642) (121,100) (135,716) (66,618) (73,519)
Finance costs — net .................. 12 (96,684) (112,921) (130,653) (63,246) (71,252)
Loss before income tax ................ (302,874) (290,136) (609,156) (133,471) (479,845)
Income tax credit .................... 13 39,877 35,057 28,312 10,904 24,759
Loss for the year/period ................ (262,997) (255,079) (580,844) (122,567) (455,086)
Other comprehensive income for the year/period
Item that may be reclassified subsequently to
profit or loss:
Change in foreign currency translation of
the financial statements of the subsidiaries of
the Company ..................... — — 21 — (14)
Total comprehensive loss for the year/period .... (262,997) (255,079) (580,823) (122,567) (455,100)
Loss for the year/period attributable to:
The equity holders of the Company .......... (262,997) (255,079) (580,709) (122,567) (454,486)
Non-controlling interests ................ — — (135) — (600)
(262,997) (255,079) (580,844) (122,567) (455,086)
Total comprehensive loss for the year/period
attributable to:
The equity holders of the Company .......... (262,997) (255,079) (580,688) (122,567) (454,500)
Non-controlling interests ................ — — (135) — (600)
(262,997) (255,079) (580,823) (122,567) (455,100)
Loss per share attributable to the equity holders
of the Company (in RMB)
Basic and diluted loss per share for loss attributable
to the equity holders of the Company (in RMB) .. 14 (16.16) (15.67) (35.67) (7.53) (27.92)
APPENDIX I ACCOUNTANTS’ REPORT
– I-6 –


--- page 528 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As at 31 December
As at
30 June
2025Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current assets
Property, plant and equipment (“ PPE”) .. 16 331,756 332,792 309,612 297,313
Right-of-use assets (“ ROU assets ”) ..... 17 44,497 42,683 41,093 43,020
Intangible assets .................. 18 2,575 2,292 1,756 1,942
Deferred tax assets ................ 19 117,252 152,318 180,653 205,423
Prepayments and other receivables ...... 24 3,881 17,486 10,542 11,230
Term deposits .................... 27 190,101 5,177 — —
Trade receivables ................. 26 — — — 39,880
Financial assets at fair value through
profit or loss (“ FVTPL ”) .......... 22 525 2,116 2,541 3,398
Total non-current assets ............ 690,587 554,864 546,197 602,206
Current assets
Inventories ...................... 20 123,465 174,227 96,544 170,521
Trade and notes receivables .......... 26 30,772 58,680 137,360 417,946
Prepayments and other receivables ...... 24 56,082 90,426 117,920 160,724
Contract assets ................... 25 2,887 9,834 12,251 20,286
Financial assets at FVTPL ........... 22 30,130 — 10,005 —
Financial assets at fair value through
other comprehensive income
(“FVTOCI ”) ................... 23 395 9,799 290 18,543
Income tax recoverable ............. 3 458 454 498
Restricted bank deposits ............. 27 27,806 27,819 10,481 22,105
Term deposits .................... 27 — 147,411 5,328 5,402
Cash and cash equivalents ........... 27 381,678 234,663 306,402 186,225
Total current assets ............... 653,218 753,317 697,035 1,002,250
Total assets ..................... 1,343,805 1,308,181 1,243,232 1,604,456
Current liabilities
Trade and notes payables ............ 30 41,530 70,689 63,299 377,708
Contract liabilities ................. 6(b) 46,757 86,124 42,011 49,314
Borrowings ..................... 28 44,606 123,834 153,842 230,884
Lease liabilities ................... 17 4,566 2,980 3,661 5,937
Other payables and accruals .......... 31 76,728 106,465 101,707 133,831
Income tax payables ............... —92 —
Provision ....................... 32 1,938 4,743 17,735 35,217
Financial instruments with preferred
rights at amortized cost ............ 29 — — — 1,962,541
Total current liabilities ............. 216,125 394,844 382,257 2,795,432
Net current assets/(liabilities) ........ 437,093 358,473 314,778 (1,793,182)
Total assets less current liabilities ..... 1,127,680 913,337 860,975 (1,190,976)
APPENDIX I ACCOUNTANTS’ REPORT
– I-7 –


--- page 529 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION — CONTINUED
As at 31 December
As at
30 June
2025Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current liabilities
Trade payables .................. 30 — — — 20,251
Borrowings ..................... 28 101,800 3,700 83,900 94,800
Lease liabilities ................... 17 1,875 608 332 180
Financial instruments with preferred
rights at amortized cost ............ 29 1,625,922 1,766,025 1,894,618 —
Total non-current liabilities ......... 1,729,597 1,770,333 1,978,850 115,231
Total liabilities .................. 1,945,722 2,165,177 2,361,107 2,910,663
Net liabilities .................... (601,917) (856,996) (1,117,875) (1,306,207)
Capital and reserves
Capital and reserves attributable to
owners of the Company:
Paid-in capital ................... 37 38,279 38,381 — —
Share capital .................... 38 — — 38,381 38,381
Treasury stock ................... 39 (1,468,141) (1,492,141) (1,492,141) (1,492,141)
Reserves ....................... 39 1,436,517 1,460,415 1,221,580 1,488,201
Accumulated losses ................ (608,572) (863,651) (885,560) (1,340,046)
Capital and reserves attributable to
owners of the Company .......... (608,572) (863,651) (1,117,740) (1,305,605)
Non-controlling interests ........... — — (135) (602)
Total deficit ..................... (601,917) (856,996) (1,117,875) (1,306,207)
APPENDIX I ACCOUNTANTS’ REPORT
– I-8 –


--- page 530 ---
STATEMENTS OF FINANCIAL POSITION OF THE COMPANY
As at 31 December
As at
30 June
2025Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current assets
Property, plant and equipment ......... 16 16,933 12,293 8,459 7,079
Right-of-use assets ................ 17 2,288 2,921 2,782 5,590
Intangible assets .................. 18 2,575 2,292 1,756 1,942
Deferred tax assets ................ 19 112,988 147,051 174,786 199,123
Investment in subsidiaries ........... 15 103,939 119,259 126,908 137,008
Prepayments and other receivables ...... 24 234,240 172,674 190,000 190,500
Term deposits .................... 27 190,101 5,177 — —
Trade receivables ................. 26 — — — 34,363
Financial assets at FVTPL ........... 22 525 2,116 2,541 3,398
Total non-current assets ............ 663,589 463,783 507,232 579,003
Current assets
Inventories ...................... 20 122,221 158,169 79,025 154,255
Trade and notes receivables .......... 26 32,017 61,666 148,386 450,507
Prepayments and other receivables ...... 24 79,493 164,231 258,852 303,374
Contract assets ................... 25 2,887 8,404 11,444 19,208
Financial assets at FVTPL ........... 22 30,130 — 10,005 —
Financial assets at FVTOCI .......... 23 — 7,849 290 6,393
Income tax recoverable ............. 3333
Restricted bank deposits ............. 27 27,806 27,819 9,796 13,312
Term deposits .................... 27 — 147,411 5,328 5,402
Cash and cash equivalents ........... 27 269,589 145,688 244,392 134,892
Total current assets ............... 564,146 721,240 767,521 1,087,346
Total assets ..................... 1,227,735 1,185,023 1,274,753 1,666,349
Current liabilities
Trade and notes payables ............ 30 50,334 82,829 75,974 394,433
Contract liabilities ................. 6(b) 39,822 67,623 21,750 29,984
Borrowings ..................... 28 39,475 33,711 153,842 225,880
Lease liabilities ................... 17 2,955 1,641 2,811 5,590
Other payables and accruals .......... 31 32,022 38,469 52,852 87,170
Provision ....................... 32 1,846 4,587 16,595 34,040
Financial instruments with preferred
rights at amortised cost ............ 29 — — — 1,962,541
Total current liabilities ............. 166,454 228,860 323,824 2,739,638
Net current assets/(liabilities) ........ 397,692 492,380 443,697 (1,652,292)
Total assets less current liabilities ..... 1,061,281 956,163 950,929 (1,073,289)
APPENDIX I ACCOUNTANTS’ REPORT
– I-9 –


--- page 531 ---
STATEMENTS OF FINANCIAL POSITION OF THE COMPANY — CONTINUED
As at 31 December
As at
30 June
2025Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current liabilities
Trade payables ................... 30 — — — 20,251
Borrowings ..................... 28 11,800 3,700 83,900 94,800
Lease liabilities ................... 17 ————
Financial instruments with preferred
rights at amortised cost ............ 29 1,625,922 1,766,025 1,894,618 —
Total non-current liabilities ......... 1,637,722 1,769,725 1,978,518 115,051
Total liabilities .................. 1,804,176 1,998,585 2,302,342 2,854,689
Net liabilities .................... (576,441) (813,562) (1,027,589) (1,188,340)
Capital and reserves
Paid-in capital ................... 37 38,279 38,381 — —
Share capital .................... 38 — — 38,381 38,381
Treasury stock ................... 39 (1,468,141) (1,492,141) (1,492,141) (1,492,141)
Reserves ....................... 39 1,436,517 1,460,415 1,221,559 1,488,127
Accumulated losses ................ (583,096) (820,217) (795,388) (1,222,707)
Total deficit ..................... (576,441) (813,562) (1,027,589) (1,188,340)
APPENDIX I ACCOUNTANTS’ REPORT
– I-10 –


--- page 532 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Attributable to the equity holders of the Company
Paid-in
capital
Share
capital
Treasury
stock
(Note 39)
Reserves
(Note 39)
Accumulated
losses Subtotal
Non-
controlling
interests Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2022 ...... 37,028 — (1,197,841) 1,167,468 (345,575) (338,920) — (338,920)
Comprehensive loss
Loss for the year ......... ———— (262,997) (262,997) — (262,997)
Total comprehensive loss for
the year ............ ———— (262,997) (262,997) — (262,997)
Transactions with owners in
their capacity as owners
Capital contributions from
the equity holders of
the Company .......... 1,251 — — 269,049 — 270,300 — 270,300
Effect of financial instruments
with preferred rights at
amortised cost ......... — — (270,300) — — (270,300) — (270,300)
Total transactions with owners
in their capacity as owners
for the year .......... 1,251 — (270,300) 269,049 ————
As at 31 December 2022 .... 38,279 — (1,468,141) 1,436,517 (608,572) (601,917) — (601,917)
APPENDIX I ACCOUNTANTS’ REPORT
– I-11 –


--- page 533 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY — CONTINUED
Attributable to the equity holders of the Company
Paid-in
capital
Share
capital
Treasury
stock
(Note 39)
Reserves
(Note 39)
Accumulated
losses Subtotal
Non-
controlling
interests Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2023 ...... 38,279 — (1,468,141) 1,436,517 (608,572) (601,917) — (601,917)
Comprehensive loss
Loss for the year ......... ———— (255,079) (255,079) — (255,079)
Total comprehensive loss for
the year ............ ———— (255,079) (255,079) — (255,079)
Transactions with owners in
their capacity as owners
Capital contributions from
the equity holders of
the Company .......... 102 — — 23,898 — 24,000 — 24,000
Effect of financial instruments
with preferred rights at
amortised cost ......... — — (24,000) — — (24,000) — (24,000)
Total transactions with owners
in their capacity as owners
for the year .......... 102 — (24,000) 23,898 ————
As at 31 December 2023 .... 38,381 — (1,492,141) 1,460,415 (863,651) (856,996) — (856,996)
APPENDIX I ACCOUNTANTS’ REPORT
– I-12 –


--- page 534 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY — CONTINUED
Attributable to the equity holders of the Company
Paid-in
capital
Share
capital
Treasury
stock
(Note 39)
Reserves
(Note 39)
Accumulated
losses Subtotal
Non-
controlling
interests Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2024 ...... 38,381 — (1,492,141) 1,460,415 (863,651) (856,996) — (856,996)
Comprehensive loss
Loss for the year ......... ———— (580,709) (580,709) (135) (580,844)
Change in foreign currency
translation of the financial
statements of the subsidiaries
of the Company ........ — — — 21 — 21 — 21
Total comprehensive loss for
the year ............ — — — 21 (580,709) (580,688) (135) (580,823)
Transactions with owners in
their capacity as owners
Conversion into a joint stock
company (Note 38(a)) ..... (38,381) 38,381 — (558,800) 558,800 — — —
Share-based payment (Note 40) . — — — 319,944 — 319,944 — 319,944
Total transactions with owners
in their capacity as owners
for the year .......... (38,381) 38,381 — (238,856) 558,800 319,944 — 319,944
As at 31 December 2024 .... — 38,381 (1,492,141) 1,221,580 (885,560) (1,117,740) (135) (1,117,875)
APPENDIX I ACCOUNTANTS’ REPORT
– I-13 –


--- page 535 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY — CONTINUED
Attributable to the equity holders of the Company
Paid-in
capital
Share
capital
Treasury
stock
(Note 39)
Reserves
(Note 39)
Accumulated
losses Subtotal
Non-
controlling
interests Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2024 ...... 38,381 — (1,492,141) 1,460,415 (863,651) (856,996) — (856,996)
Comprehensive loss
Loss for the period ........ ———— (122,567) (122,567) — (122,567)
Total comprehensive loss for
the period ........... ———— (122,567) (122,567) — (122,567)
As at 30 June 2024
(Unaudited) .......... 38,381 — (1,492,141) 1,460,415 (986,218) (979,563) — (979,563)
Attributable to the equity holders of the Company
Paid-in
capital
Share
capital
Treasury
stock
(Note 39)
Reserves
(Note 39)
Accumulated
losses Subtotal
Non-
controlling
interests Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2025 ...... — 38,381 (1,492,141) 1,221,580 (885,560) (1,117,740) (135) (1,117,875)
Comprehensive loss
Loss for the period ........ ———— (454,486) (454,486) (600) (455,086)
Change in foreign currency
translation of the financial
statements of the subsidiaries
of the Company ........ — — — (14) — (14) — (14)
Total comprehensive loss for
the period ........... — — — (14) (454,486) (454,500) (600) (455,100)
Transactions with owners in
their capacity as owners
Contribution from
non-controlling interests with
change of the ownership
interest in a subsidiary that do
not result in a loss of control
(Note 15(a)(d)) ......... — — — 67 — 67 133 200
Share-based payment (Note 40) . — — — 266,568 — 266,568 — 266,568
Total transactions with owners
in their capacity as owners
for the year .......... — — — 266,635 — 266,635 133 266,768
As at 30 June 2025 ....... — 38,381 (1,492,141) 1,488,201 (1,340,046) (1,305,605) (602) (1,306,207)
APPENDIX I ACCOUNTANTS’ REPORT
– I-14 –


--- page 536 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS
Y ear ended 31 December Six months ended 30 June
Notes 2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Operating activities
Loss before income tax ................ (302,874) (290,136) (609,156) (133,471) (479,845)
Adjustments for:
Depreciation of property, plant and equipment ... 7 16,708 21,479 25,582 12,938 12,473
Amortisation of intangible assets .......... 7 1,053 1,430 1,459 758 778
Depreciation of right-of-use assets ......... 7 5,966 7,116 7,612 4,016 3,708
Impairment losses under expected credit losses
(“ECL”) model .................. 11 5,092 (3,589) 29,038 5,280 84,280
Loss/(gain) on disposal of/written off property,
plant and equipment ............... 10 15 (120) 20 7 1
Gain on lease termination .............. 10 — (90) (80) (7) —
Provision for inventories .............. 7 5,235 11,825 3,673 753 985
Share-based payment expenses ........... 8 — — 319,944 — 266,568
Change in fair value of financial assets at FVTPL . 10 (129) (591) 70 102 (396)
Interest income from financial assets at FVTPL .. 12 (258) (11) — — (16)
Interest income from trade receivables with
significant financing components ......... ———— (1,288)
Interest income from term deposits ......... 12 (4,276) (5,215) (2,499) (2,124) (74)
Interest income from loan to a third party ..... 12 — (71) (377) (161) (221)
Interest income from loan to a related party of the
Company ..................... 12 — (16) — — —
Finance costs .................... 12 105,642 121,100 135,716 66,618 73,519
Exchange gain, net ................. — — (6) — 8
Operating cash flows before movements in
working capital ................... (167,826) (136,889) (89,004) (45,291) (39,520)
(Increase)/Decrease in inventories ........... 20 (51,487) (62,586) 74,011 57,906 (74,963)
Increase in trade and notes receivables, other
receivables and prepayments and
financial assets at FVTOCI ............. 23, 24, 26 (35,475) (63,358) (109,937) (29,903) (420,322)
Decrease/(Increase) in contract assets ......... 25 1 (6,852) (2,581) 1,259 (9,240)
(Increase)/Decrease in restricted bank deposits .... 27 (672) (27,142) 27,102 27,070 (11,489)
Increase/(Decrease) in trade and notes payables and
other payables .................... 30, 31 23,847 61,154 (3,187) (37,941) 340,023
Increase/(Decrease) in contract liabilities
....... 28,559 39,367 (44,113) (15,572) 7,303
Cash (used in)/generated from operations ..... (203,053) (196,306) (147,709) (42,472) (208,208)
Income taxes paid ................... — (455) (26) (9) (2)
Net cash (used in)/generated from operating
activities ....................... (203,053) (196,761) (147,735) (42,481) (208,210)
APPENDIX I ACCOUNTANTS’ REPORT
– I-15 –


--- page 537 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS — CONTINUED
Y ear ended 31 December Six months ended 30 June
Notes 2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Investing activities
Proceeds from disposal of property, plant and
equipment ...................... 30 169 14 4 —
Purchase of property, plant and equipment ...... (152,611) (29,713) (1,393) (584) (1,065)
Purchase of intangible assets ............. (808) (699) (684) (42) (705)
Purchase of financial assets at FVTPL ........ (30,500) (1,000) (10,500) — (500)
Advance to a third party ................ — (9,800) (2,600) — —
Advance to a related party of the Company ..... — (3,000) — — —
Repayment from a related party of the Company ... — 3,000 — — —
Placement of term deposits .............. (105,000) ————
Repayment from term deposits ............ — 40,000 140,000 100,000 —
Proceeds received at the maturity of financial assets
at FVTPL ...................... — 30,000 — — 10,000
Proceeds of lease deposits ............... —— 2 8 9——
Interest income received from financial assets at
FVTPL ........................ 258 141 — — 60
Interest income received from term deposits ..... — 2,727 9,760 5,500 —
Interest income received from a related party of the
Company ....................... —1 7———
Placement of restricted bank deposits ......... (27,100) — (10,170) — (9,910)
Repayment from restricted bank deposits ....... 13,347 27,130 406 — 9,774
Net cash (used in)/generated from investing
activities ....................... (302,384) 58,972 125,122 104,878 7,654
Financing activities
Proceeds from issuance of shares with preferred
rights ......................... 270,300 24,000 — — —
Transaction costs for acquisition of capital
contributions from investors ............ (19,891) — (1,440) (1,440) —
Proceeds from capital contributions from
non-controlling interests ............... 15(a), (d) ———— 2 0 0
Proceeds from a factoring company ......... ———— 2,000
Proceeds from bank borrowings ............ 33 146,143 25,700 238,900 140,500 158,600
Repayment of bank borrowings ............ 33 — (44,543) (128,700) (98,400) (72,700)
Interest paid on bank borrowings ........... 33 (3,017) (5,754) (6,950) (3,479) (4,540)
Repayment of lease liabilities ............. 33 (6,859) (8,421) (5,518) (2,194) (2,944)
Interest paid on lease liabilities ............ 33 (350) (208) (165) (68) (32)
Payments for listing expenses ............. — — (1,802) — (183)
Net cash generated from/(used in) financing
activities ....................... 386,326 (9,226) 94,325 34,919 80,401
Net (decrease)/increase in cash and cash
equivalents ..................... (119,111) (147,015) 71,712 97,316 (120,155)
Cash and cash equivalents at beginning of
year/period ..................... 500,789 381,678 234,663 234,663 306,402
Effect of exchange rate changes ............ — — 27 — (22)
Cash and cash equivalents at the end of
year/period, represented by bank balances and
cash ......................... 381,678 234,663 306,402 331,979 186,225
APPENDIX I ACCOUNTANTS’ REPORT
– I-16 –


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II NOTES TO HISTORICAL FINANCIAL INFORMATION
1 GENERAL INFORMATION
CiDi Inc. (the “ Company ”) was incorporated in the People’s Republic of China (the “ PRC”)
on 16 October 2017 as a limited liability company. The Company’s registered office and the
principal place of business activities is located at Building A3 and A4, Hunan Inspection and
Testing Specialty Industrial Park, No. 336, Xueshi Road, Yuelu District, Changsha City, Hunan
Province, the PRC.
Upon approval by the shareholders’ general meeting held on 28 May 2024, the Company was
converted into a joint stock company with limited liability under the Company Law of the PRC
and changed its registered name from “Changsha Intelligent Driving Institute (Ӻ
ʮ̡ )” to “CiDi Inc. (౽ቷ(ی)ʮ̡ )” in July 2024. On 8 January 2025, the
Company’s registered name was further changed from “CiDi Inc. (౽ቷ(ی)ʮ̡ )”
to “CiDi Inc. (ʮ̡ )”.
In the opinion of the directors of the Company, the ultimate controlling shareholder of the
Company is Li Zexiang.
The Company and its subsidiaries (collectively, the “ Group ”) are principally engaged in
providing autonomous driving products and solutions for commercial vehicles.
The detailed information of major subsidiaries was disclosed in Note 15.
2 SUMMARY OF ACCOUNTING POLICY INFORMATION
The material accounting policies applied in the preparation of the Historical Financial
Information are set out below. These policies have been consistently applied throughout the Track
Record Period, unless otherwise stated.
The statutory financial statements have not yet been issued for the years ended 31 December
2022, 31 December 2023 and 31 December 2024. There is no statutory requirement to issue the
audit report for the PRC company.
2.1 Basis of Preparation
The Historical Financial Information of the Group have been prepared based on the
accounting policies set out in Note 2.2 which conform with IFRS Accounting Standards issued by
International Accounting Standards Board (“ IASB”).
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The Historical Financial Information has been prepared under the historical cost convention,
as modified by the revaluation of certain financial assets at FVTPL and financial assets at
FVTOCI, which are carried at fair value.
The Group is in the development phase and has been incurring losses from operations since
incorporation. The Group incurred losses of RMB455,086,000 for the period ended 30 June 2025.
Also, the Group’s net cash used in operating activities was RMB208,210,000 for the period ended
30 June 2025, attributable primarily to significant R&D expenditures. As at 30 June 2025, the
Group has cash and cash equivalents of RMB186,225,000, net current liabilities of
RMB1,793,182,000 and net liabilities of RMB1,306,207,000, attributable primarily to the financial
instruments with preferred rights at amortized cost with an amount of RMB1,962,541,000. The
Group’s ability to continue as a going concern is primarily dependent on the ability to generate
adequate cash flows from business operations and to raise external equity and debt financing to
fund its continuous operations.
Management of the Group has prepared a cash flow projection covering a period of not less
than 12 months from 30 June 2025. The cash flow projection has taken into account management’s
plan to improve the Group’s operating performance and cash flows by expanding its customer base
and increasing revenues, and to raise additional funds through external debt financing. Subject to
the result of external debt financing, management will implement measures to optimize its
operating efficiency, including but not limited to control the expenditures, to improve the Group’s
liquidity and financial position. The directors of the Company, after making due inquiries and
considering the basis of management’s projection and measures described above, believe that the
Group’s cash and cash equivalents and anticipated funding from financing are sufficient to fund its
operating expenses and capital expenditure requirements, and the Group is able to meet its
payment obligations, for the next twelve months from 30 June 2025. Therefore, the Historical
Financial Information has been prepared on a going concern basis.
The preparation of the 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 the Group’s accounting policies. The areas
involving a higher degree of judgment or complexity, or areas where assumptions and estimates
are significant to the Historical Financial Information are disclosed in Note 4.
The Historical Financial Information has been prepared based on the consolidated financial
statements of the Group. Inter-company transactions, balances and unrealized gains/losses on
transactions between group companies are eliminated on consolidation.
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New standards, amendments to standards and interpretations not yet adopted
Certain new accounting standards, amendments to accounting standards and interpretations
have been published that are not effective for the Track Record Period and have not been early
adopted by the Group. These standards, amendments or interpretations are not expected to have a
material impact on the Group in the current or future reporting periods and on foreseeable future
transactions except the new IFRS 18 as set out below.
The Group plans to adopt these new standards, amendments to standards and annual
improvements when they become effective:
New and amendments to IFRS Accounting Standards issued but not yet effective
Amendments to IFRS 9 and IFRS 7 Amendments to the Classification and Measurement of
Financial Instruments
1
Amendments to IFRS Accounting
Standards
Annual Improvements to IFRS Accounting Standards 1
IFRS 18 Presentation and Disclosure in Financial Statements 2
IFRS 19 Subsidiaries without Public Accountability: Disclosures 2
Amendments to IFRS 10 and IAS 28 Sale or contribution of Assets between an Investor and
its Associate or Joint Venture 3
Amendments to IFRS 9 and IFRS 7 Contracts Referencing Nature-dependent Electricity 1
Amendments to IAS 21 Translation to a Hyperinflationary Presentation
Currency 2
1 Effective for annual periods beginning on or after 1 January 2026
2 Effective for annual periods beginning on or after 1 January 2027
3 The amendments shall be applied prospectively to sale or contribution of assets occurring in annual periods
beginning on or after a date to be determined.
The Group has already commenced an assessment of the impact of these new or revised
standards and amendments.
IFRS 18 sets out requirements on presentation and disclosures in financial statements and it
will replace IAS 1 Presentation of Financial Statements. The new standard introduces new
requirements to present specified categories and defined subtotals in the statement of profit or loss;
provide disclosures on management-defined performance measures in the notes to the financial
statements and improve aggregation and disaggregation of information to be disclosed in the
financial statements. Minor amendments to IAS 7 Statement of Cash Flows and IAS 33 Earnings
APPENDIX I ACCOUNTANTS’ REPORT
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per Share are also made. IFRS 18 will be effective for annual periods beginning on or after 1
January 2027, with early application permitted. The Group does not plan to early adopt IFRS 18.
IFRS 18, after its adoption on 1 January 2027, will impact the presentation of financial statements
(including aggregation and disaggregation of items within statement of financial position and
statement of profit or loss and other comprehensive income), but in terms of recognition and
measurement, IFRS 18 is not expected to have significant impact on the financial performance and
positions of the Group.
Except for this, no material impact on the financial performance and positions of the Group is
expected when they become effective.
2.2 Material accounting policy information
2.2.1 Inventories
Inventories are stated at the lower of cost and net realizable value. Cost mainly comprises
contract costs in progress, raw materials, consigned-processing-material and finished goods. Costs
of purchased inventories are determined after deducting rebates and discounts. Net realizable value
is the estimated selling price in the ordinary course of business less the estimated costs of
completion and the estimated costs necessary to make the sale.
2.2.2 Current and deferred income tax
The income tax expense or credit for the period is the tax payable on the current period’s
taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes
in deferred income tax assets and liabilities attributable to temporary differences and to unused tax
losses.
(a) Current income tax
The current income tax charge is calculated on the basis of the tax laws enacted or
substantively enacted at the end of each reporting period in the countries where the Company and
its subsidiaries operate and generate taxable income. Management periodically evaluates positions
taken in tax returns with respect to situations in which applicable tax regulation is subject to
interpretation and considers whether it is probable that a taxation authority will accept an uncertain
tax treatment. The Group measures its tax balances either based on the most likely amount or the
expected value, depending on which method provides a better prediction of the resolution of the
uncertainty.
APPENDIX I ACCOUNTANTS’ REPORT
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(b) Deferred income tax
Deferred income tax is provided in full, using the liability method, on temporary differences
arising between the tax bases of assets and liabilities and their carrying amounts in the Historical
Financial Information. However, deferred income tax liabilities are not recognized if they arise
from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises
from initial recognition of an asset or liability in a transaction other than a business combination
that at the time of the transaction affects neither accounting nor taxable profit or loss and does not
give rise to equal taxable and deductible temporary differences. Deferred income tax is determined
using tax rates (and laws) that have been enacted or substantively enacted by the end of each
reporting period and are expected to apply when the related deferred income tax asset is realized
or the deferred income tax liability is settled.
Deferred tax assets are recognized only if it is probable that future taxable amounts will be
available to utilize those temporary differences and losses.
Deferred tax liabilities and assets are not recognized for temporary differences between the
carrying amount and tax bases of investments in foreign operations where the Group is able to
control the timing of the reversal of the temporary differences and it is probable that the
differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset
current tax assets and liabilities and where the deferred tax balances relate to the same taxation
authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable
right to offset and intends either to settle on a net basis, or to realize the asset and settle the
liability simultaneously.
Current and deferred tax is recognized in profit or loss, except to the extent that it relates to
items recognised in other comprehensive income or directly in equity. In this case, the tax is also
recognised in other comprehensive income or directly in equity, respectively.
2.2.3 Revenue recognition
The Group recognizes revenue when (or as) a performance obligation is satisfied, i.e., when
control of the goods underlying the particular performance obligation is transferred to the
customer.
APPENDIX I ACCOUNTANTS’ REPORT
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Control is transferred over time and revenue is recognized over time by reference to the
progress towards complete satisfaction of the relevant performance obligation if one of the
following criteria is met:
 provides all of the benefits received and consumed simultaneously by the customer;
 creates and enhances an asset that the customer controls as the Group performs; or
 does not create an asset with an alternative use to the Group and the Group has an
enforceable right to payment for performance completed to date.
Otherwise, revenue is recognized at a point in time when the customer obtains control of the
distinct goods or services.
In determining whether revenue of the Group should be reported gross or net is based on a
continuing assessment of various factors. When determining whether the Group is acting as the
principal or agent in offering goods or services to the customer, the Group needs to first identify
who controls the specified goods or services before they are transferred to the customer. The
Group follows the accounting guidance for principal-agent considerations to assess whether the
Group controls the specified goods or service before it is transferred to the customer, the indicators
of which including but not limited to (a) whether the entity is primarily responsible for fulfilling
the promise to provide the specified service; (b) whether the entity has inventory risk before the
specified service has been transferred to a customer; and (c) whether the entity has discretion in
establishing the prices for the specified goods or service. The management considers the above
factors in totality, as none of the factors individually are considered presumptive or determinative,
and applies judgment when assessing the indicators depending on each different circumstances.
At the inception of the contract, the Group assesses the goods promised that have been
promised to the customer and identifies as a performance obligation when (a) a good or service (or
a bundle of goods or services) that is distinct; or (b) a series of distinct goods or services that are
substantially the same and that have the same pattern of transfer to the customer.
1) Autonomous driving solutions
Revenue generated from sales of autonomous driving solutions which combines the
unmanned electric mining trucks and logistics trucks with remote control cockpit and solutions
with proprietary algorithms and software for use in closed environments, which is recognized at
the point in time when the performance obligation under the terms of a contract with the customer
is satisfied and control of the product has been transferred to the customer, generally upon the
acceptance of the solutions.
APPENDIX I ACCOUNTANTS’ REPORT
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The Group controls the specified goods and services before they are transferred to a customer
and has discretion in establishing prices. The Group is the principal and the revenue generated
from sales of autonomous driving solutions is reported on a gross basis.
The Group generally offers assurance-type warranties to customers and such warranties are
not considered a distinct performance obligation to customers. The Group accounts for the
warranty in accordance with IAS 37 (Note 32).
After the sales contracts have been signed, partial consideration will be collected by the
Group. The Group began to stock up after collecting the prepayments. Before the solutions are
delivered to the customers, partial consideration will be collected by the Group. The remaining
consideration except for the amount of quality warranty will be collected during the credit period
of customers. The amount of quality warranty will be collected after the end of the warranty
period. The Group usually offers a warranty period of six months to one year.
2) Autonomous driving products
Revenue generated from sales of autonomous driving products for use in closed environments
which could be installed in the electric trucks, which is recognized at the point in time when the
performance obligation under the terms of a contract with the customer is satisfied and control of
the products has been transferred to the customer, generally upon the acceptance of the products.
The Group controls the specified goods before they are transferred to a customer and has
discretion in establishing prices. The Group is the principal and the revenue generated from sales
of autonomous driving products is reported on a gross basis.
The Group generally has the right to collect certain of the contract price of the products from
the customers upon their acceptance of the products. The remaining payments are settled after the
end of the standard warranty period. The Group usually offers a warranty period for one year.
3) V ehicle to everything (“ V2X”) products and solutions
The Group provides V2X products and solutions to its customers. Revenue is recognized
when control over the products and solutions have been transferred to the customer. The customers
cannot receive and consume the benefits simultaneously from the Group as well as control the
products and solutions until the products and solutions are delivered to the customer. The products
and solutions generally have no alternative use for the Group due to contractual restrictions.
However, an enforceable right to payment does not arise until the products and solutions are
accepted by the customer. Therefore, revenue is recognized at a point in time when the products
and solutions are accepted by the customer.
APPENDIX I ACCOUNTANTS’ REPORT
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The determination of whether revenue should be reported on a gross or net basis is based on
an assessment of whether the Group is acting as the principal or an agent in the transactions. The
Group provides significant service to the V2X products and solutions and is responsible for the
overall management of the contract, the Group is the principal in the transaction and recognizes
revenue in the gross amount of consideration to which it is entitled from the customer.
After the sales contracts have been signed, partial consideration will be collected by the
Group. Then, after the products and solutions are delivered to the designated location of customers
and are initial accepted by the customers, partial consideration will be collected by the Group. The
remaining consideration except for the amount of quality warranty will be collected after the final
acceptance of customers. The amount of quality warranty will be collected after the end of the
warranty period. The Group usually offers a warranty period from one year to three years.
4) Commission income
The Group acts in the capacity of an agent rather than as the principal in the transaction of
ancillary services relating to procurement of the peripheral software development services related
to V2X. Revenue generated from these services is reported on a net basis.
5) Intelligent perception
Revenue generates from sales of intelligent perception solutions is recognized at the point in
time when the performance obligation under the terms of a contract with the customer is satisfied
and control of the solutions has been transferred to the customer, generally upon the acceptance of
the products and solutions.
The Group controls the specified goods and services before they are transferred to a customer
and has discretion in establishing prices. The Group is the principal and the revenue generated
from sales of intelligent perception solutions is reported on a gross basis.
The consideration will be collected once through bank acceptance notes after the settlements
with customers monthly. The Group usually offers a warranty period from one year to three years.
APPENDIX I ACCOUNTANTS’ REPORT
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6) Contract assets and liabilities
When either party to a contract has performed, the Group presents the contract in the
consolidated statements of financial position as a contract asset or a contract liability, depending
on the relationship between the Group’s performance and the customer’s payment. A contract asset
is the Group’s right to consideration in exchange for services that the Group has transferred to a
customer.
If a customer pays consideration or the Group has a right to an amount of consideration that
is unconditional, before the Group transfers goods to the customer, the Group has a contract
liability when the payment is received or a receivable is recorded (whichever is earlier). A contract
liability is the Group’s obligation to transfer goods to a customer for which the Group has received
consideration from the customer. A receivable is recorded when the Group has an unconditional
right to consideration. The right to consideration is unconditional if only the passage of time is
required before payment of that consideration is due.
2.2.4 Principles of consolidation
Subsidiaries
Subsidiaries are all entities over which the Group has control. The Group controls an entity
where the Group is exposed to, or has rights to, variable returns from its involvement with the
entity and has the ability to affect those returns through its power to direct the activities of the
entity. Subsidiaries are fully consolidated from the date on which control is transferred to the
Group. They are deconsolidated from the date that control ceases.
Inter-company transactions, balances and unrealized gains on transactions between group
companies are eliminated. Unrealized losses are also eliminated unless the transaction provides
evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been
changed where necessary to ensure consistency with the policies adopted by the Group.
2.2.5 Separate financial statements
Investments in subsidiaries are accounted for at cost less impairment. Cost includes direct
attributable costs of investment. The results of the subsidiaries are accounted for by the Company
on the basis of dividend received and receivable.
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Impairment testing of the investments in subsidiaries is required upon receiving dividends
from these investments if the dividend exceeds the total comprehensive income of the subsidiary in
the year the dividend is declared or if the carrying amount of the investment in the separate
financial statements exceeds the carrying amount in the consolidated financial statements of the
investee’s net assets including goodwill.
2.2.6 Foreign currency translation
(a) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using
the currency of the primary economic environment in which the entity operates (the “ functional
currency ”). The functional currency for Company and its subsidiaries incorporated in the People’s
Republic of China (“ PRC”) is RMB. The Group’s presentation currency is RMB.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange
rates prevailing at the dates of the transactions or valuation where items are re-measured. Foreign
exchange gains and losses resulting from the settlement of such transactions and from the
translation of monetary assets and liabilities denominated in foreign currencies at year-end
exchange rates are generally recognised in profit or loss.
Foreign exchange gains and losses that relate to borrowings are presented in the consolidated
statements of profit or loss and other comprehensive income within finance costs. All other foreign
exchange gains and losses are presented in the consolidated statements of profit or loss and other
comprehensive income on a net basis within “Other gains/(losses), net”.
Non-monetary items that are measured at fair value in a foreign currency are translated using
the exchange rates at the date when the fair value was determined. Translation differences on
assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For
example, translation differences on non-monetary assets and liabilities such as equities held at fair
value through profit or loss are recognized in profit or loss as part of the fair value gain or loss
and translation differences on non-monetary assets such as equities classified as FVTOCI are
recognized in OCI.
2.2.7 Property, plant and equipment
Property, plant and equipment are stated at historical cost less depreciation and accumulated
impairment.
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Historical cost includes expenditure that is directly attributable to the acquisition of the
items.
Subsequent costs are included in the asset’s carrying amount or recognized as a separate
asset, as appropriate, only when it is probable that future economic benefits associated with the
item will flow to the Group and the cost of the item can be measured reliably. The carrying
amount of any component accounted for as a separate asset is derecognized when replaced. All
other repairs and maintenance are charged to profit or loss during the year/period in which they
are incurred.
Other than construction in progress, depreciation is calculated using the straight-line method
to allocate their cost, net of their residual values, over their estimate useful lives as follows:
Buildings 10−20 years
Vehicles 4 years
Machinery and equipment 5 years
Office equipment, computers and others 5 years
Tested field and related equipment 5 years
Leasehold improvements shorter of the term of the lease or the
estimated useful lives of the assets
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the
end of each reporting period.
An asset’s carrying amount is written down immediately to its recoverable amount if the
asset’s carrying amount is greater than its estimated recoverable amount (Note 2.2.9).
Gains and losses on disposals are determined by comparing the proceeds with the carrying
amount and are recognized within “Other gains/(losses), net” in the consolidated statements of
profit or loss and other comprehensive income.
Construction in progress represents unfinished construction and equipment under construction
or pending for installation, and is stated at cost less impairment losses. Cost comprises direct costs
of construction including borrowing costs attributable to the construction during the period of
construction. No provision for depreciation is made on construction in progress until such time as
the relevant assets are completed and ready for intended use.
APPENDIX I ACCOUNTANTS’ REPORT
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2.2.8 Intangible assets
(a) Software
Acquired software is initially capitalized on the basis of the costs incurred to acquire and
bring to use the specific software. Costs associated with maintaining computer software programs
are recognized as an expense as incurred. Software is stated at historical cost less accumulated
amortization and impairment losses, if any. Amortization is calculated using the straight-line
method to allocate the cost over their estimated useful lives. The Group amortizes software with a
limited useful life using the straight-line method over the following periods:
Software 3 years
When determining the useful life, the management of the Group has taken into the account
the (i) estimated period that can bring economic benefits to the Group; (ii) the useful life estimated
by the comparable companies in the market.
(b) Research and development (“ R&D”)
The Group incurs significant costs and efforts on research and development activities.
Research expenditure is recognized as an expense as incurred. Costs incurred on research and
development projects are recognized as intangible assets when the following criteria are met:
 it is technically feasible to complete the research and development project so that it will
be available for use or sale;
 management intends to complete the research and development project and use or sell it;
 there is an ability to use or sell the research and development project;
 it can be demonstrated how the research and development project will generate probable
future economic benefits;
 adequate technical, financial and other resources to complete the development and to
use or sell the research and development project are available; and
 the expenditure attributable to the research and development project during its
development can be reliably measured.
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The cost of an internally generated intangible asset is the sum of the expenditures incurred
from the date the asset meets the recognition criteria above to the date when it is available for use.
The costs capitalized in connection with the intangible asset include costs of materials and services
used or consumed, employee costs incurred in the creation of the asset and an appropriate portion
of relevant overheads.
Development expenditures not satisfying the above criteria are recognized in the profit or loss
as incurred and development expenditures previously recognized as an expense are not recognized
as an asset in a subsequent period.
During the Track Record Period, the Group’s R&D expenditures incurred did not meet the
capitalization principle above and were expensed as incurred.
2.2.9 Impairment of non-financial assets
Non-financial assets, including PPE, ROU assets, intangible assets, prepayments for
acquisition of PPE and investment in subsidiaries, are tested for impairment whenever events or
changes in circumstances indicate that the carrying amount may not be recoverable. An impairment
loss is recognized in profit or loss for the amount by which the carrying amount of an asset
exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less
costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the
lowest levels for which there are separately identifiable cash inflows which are largely
independent of the cash inflows from other assets or groups of assets (cash-generating units).
Non-financial assets that suffered an impairment are reviewed for possible reversal of the
impairment at the end of each reporting period.
2.2.10 Investments and other financial assets
(a) Classification
The Group classifies its financial assets in the following measurement categories:
 those to be measured subsequently at fair value (either through OCI, or through profit or
loss), and
 those to be measured at amortized cost.
The classification depends on the Group’s business model for managing the financial assets
and the contractual terms of the cash flows.
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For assets measured at fair value, gains and losses will either be recorded in profit or loss or
OCI. For investments in debt instruments, this will depend on the business model in which the
investment is held. For investments in equity instruments that are not held for trading, this will
depend on whether the Group has made an irrevocable election at the time of initial recognition to
account for the equity investment at FVTOCI.
The Group reclassifies debt investments when and only when its business model for
managing those assets changes.
(b) Recognition and derecognition
Regular way purchases and sales of financial assets are recognized on trade-date, the date on
which the Group commits to purchase or sell the asset. Financial assets are derecognized when the
rights to receive cash flows from the financial assets have expired or have been transferred and the
Group has transferred substantially all the risks and rewards of ownership.
(c) Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case
of a financial asset not at FVTPL, transaction costs that are directly attributable to the acquisition
of the financial asset. Transaction costs of financial assets carried at FVTPL are expensed in profit
or loss.
Financial assets with embedded derivatives are considered in their entirety when determining
whether their cash flows are solely payment of principal and interest.
Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for
managing the asset and the cash flow characteristics of the asset. There are three measurement
categories into which the Group classifies its debt instruments:
 Amortized cost: Assets that are held for collection of contractual cash flows where those
cash flows represent solely payments of principal and interest are measured at amortized
cost. Interest income from these financial assets is included in “Finance income” using
the effective interest rate method. Any gain or loss arising on derecognition is
recognized directly in profit or loss and presented in “Other gains/(losses), net” together
with foreign exchange gains and losses. Impairment losses are presented as separate line
item in the consolidated statements of profit or loss and other comprehensive income.
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 FVTOCI: Assets that are held for collection of contractual cash flows and for selling the
financial assets, where the assets’ cash flows represent solely payments of principal and
interest, are measured at FVTOCI. Movements in the carrying amount are taken through
OCI, except for the recognition of impairment gains or losses, interest income and
foreign exchange gains and losses which are recognized in profit or loss. When the
financial asset is derecognized, the cumulative gain or loss previously recognized in
OCI is reclassified from equity to profit or loss and recognized in “Other gains/(losses),
net”. Interest income from these financial assets is included in finance income using the
effective interest rate method. Foreign exchange gains and losses are presented in
“Other gains/(losses), net” and impairment expenses are presented as separate line item
in the consolidated statements of profit or loss and other comprehensive income.
 FVTPL: Assets that do not meet the criteria for amortized cost or financial assets at
FVTOCI are measured at FVTPL. A gain or loss on a debt investment that is
subsequently measured at fair value through profit or loss and is not part of a hedging
relationship is recognized in profit or loss and presented net in “Other gains/(losses),
net” in the period in which it arises.
Equity instruments
The Group subsequently measures all equity investments at fair value. Where the Group’s
management has elected to present fair value gains and losses on equity investments in OCI, there
is no subsequent reclassification of fair value gains and losses to profit or loss following the
derecognition of the investment. Dividends from such investments continue to be recognized in
profit or loss as other income when the Group’s right to receive payments is established.
Changes in the fair value of financial assets at FVTPL are recognized in “Other
gains/(losses), net” in the consolidated statements of profit or loss and other comprehensive
income as applicable.
(d) Impairment
The Group performs impairment assessment under ECL model on financial assets which are
measured at amortized cost and contract assets. The amount of ECL is updated at each reporting
date to reflect changes in credit risk since initial recognition.
Lifetime ECL represents the ECL that will result from all possible default events over the
expected life of the relevant instrument. In contrast, 12-month ECL (“ 12m ECL ”) represents the
portion of lifetime ECL that is expected to result from default events that are possible within 12
months after the reporting date. Assessments are done based on the Group’s historical credit loss
APPENDIX I ACCOUNTANTS’ REPORT
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experience, adjusted for factors that are specific to the debtors, general economic conditions and
an assessment of both the current conditions at the reporting date as well as the forecast of future
conditions.
The Group always recognizes lifetime ECL for trade receivables and contract assets. The
ECL on these assets is assessed collectively and individually.
For all other instruments, the Group measures the loss allowance equal to 12m ECL, unless
when there has been a significant increase in credit risk since initial recognition, in which case the
Group recognizes lifetime ECL. The assessment of whether lifetime ECL should be recognized is
based on significant increases in the likelihood or risk of a default occurring since initial
recognition.
(i) Significant increase in credit risk
In assessing whether the credit risk has increased significantly since initial recognition, the
Group compares the risk of a default occurring on the financial instrument as at each reporting
date with the risk of a default occurring on the financial instrument as at the date of initial
recognition. In making this assessment, the Group considers both quantitative and qualitative
information that is reasonable and supportable, including historical experience and forward-looking
information that is available without undue cost or effort.
In particular, the following information is taken into account when assessing whether credit
risk has increased significantly:
 an actual or expected significant deterioration in the financial instrument’s external (if
available) or internal credit rating;
 significant deterioration in external market indicators of credit risk, e.g. a significant
increase in the credit spread, the credit default swap prices for the debtor;
 existing or forecast adverse changes in business, financial or economic conditions that
are expected to cause a significant decrease in the debtor’s ability to meet its debt
obligations;
 an actual or expected significant deterioration in the operating results of the debtor; and
 an actual or expected significant adverse change in the regulatory, economic, or
technological environment of the debtor that results in a significant decrease in the
debtor’s ability to meet its debt obligations.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 554 ---
Irrespective of the outcome of the above assessment, the Group presumes that the credit risk
has increased significantly since initial recognition when contractual payments are more than 30
days past due, unless the Group has reasonable and supportable information that demonstrates
otherwise.
The Group regularly monitors the effectiveness of the criteria used to identify whether there
has been a significant increase in credit risk and revises them as appropriate to ensure that the
criteria are capable of identifying significant increase in credit risk before the amount becomes
past due.
(ii) Definition of default
For internal credit risk management, the Group considers an event of default occurs when
information developed internally or obtained from external sources indicates that the debtor is
unlikely to pay its creditors, including the Group, in full.
Irrespective of the above, the Group considers that default has occurred when a financial
asset is more than 90 days past due unless the Group has reasonable and supportable information
to demonstrate that a more lagging default criterion is more appropriate.
(iii) Credit-impaired financial assets
A financial asset is credit-impaired when one or more events of default that have a
detrimental impact on the estimated future cash flows of that financial asset have occurred.
Evidence that a financial asset is credit-impaired includes observable data about the following
events:
(a) significant financial difficulty of the issuer or the borrower;
(b) a breach of contract, such as a default or past due event;
(c) the lender(s) of the borrower, for economic or contractual reasons relating to the
borrower’s financial difficulty, having granted to the borrower a concession(s) that the
lender(s) would not otherwise consider; or
(d) it is becoming probable that the borrower will enter bankruptcy or other financial
reorganization.
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--- page 555 ---
(iv) Write-off policy
The Group writes off a financial asset when there is information indicating that the
counterparty is in severe financial difficulty and there is no realistic prospect of recovery, for
example, when the counterparty has been placed under liquidation or has entered into bankruptcy
proceedings, or in the case of trade receivables, when the amounts are over one year past due,
whichever occurs sooner. Financial assets written off may still be subject to enforcement activities
under the Group’s recovery procedures, taking into account legal advice where appropriate. A
write-off constitutes a derecognition event. Any subsequent recoveries are recognized in profit or
loss.
(v) Measurement and recognition of ECL
The measurement of ECL is a function of the probability of default, loss given default (i.e.
the magnitude of the loss if there is a default) and the exposure at default. The assessment of the
probability of default and loss given default is based on historical data and forward-looking
information. Estimation of ECL reflects an unbiased and probability weighted amount that is
determined with the respective risks of default occurring as the weights.
Generally, the ECL is the difference between all contractual cash flows that are due to the
Group in accordance with the contract and the cash flows that the Group expects to receive,
discounted at the effective interest rate determined at initial recognition.
2.2.11 Financial guarantee contracts
A financial guarantee contract is a contract that requires the issuer to make specified
payments to reimburse the holder for a loss it incurs because a specified debtor fails to make
payments when due in accordance with the terms of a debt instrument. Financial guarantee
contract liabilities are measured initially at their fair values. It is subsequently measured at the
higher of:
 the amount of the loss allowance determined in accordance with IFRS 9; and
 the amount initially recognized less, where appropriate, cumulative amortization
recognized over the guarantee period.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 556 ---
2.2.12 Trade receivables
Trade receivables are amounts due from customers for the products and solutions rendered in
the ordinary course of business. If collection of trade receivables is expected in one year or less
(or in the normal operating cycle of the business if longer), they are classified as current assets. If
not, they are presented as non-current assets.
Trade receivables are recognized initially at the amount of consideration that is unconditional
unless they contain significant financing components, when they are recognized at fair value. The
Group holds the trade receivables with the objective of collecting the contractual cash flows and
therefore measures them subsequently at amortized cost using the effective interest method. See
Note 26 for further information about the Group’s accounting for trade receivables and Note 3.1
(b) for a description of the Group’s credit risk management.
2.2.13 Financial instruments with preferred rights at amortized cost
A contract that contains an obligation for the Group to purchase the Group’s equity
instruments for cash or another financial asset gives rise to a financial liability for the present
value of the redemption amount. Even if the Group’s obligations to purchase are conditional on the
counterparty exercising a right to redeem, the financial instruments with preferred rights are
recognized as financial liability initially measured at fair value (representing the present value of
the redemption amount) and subsequently measured at amortized cost with interest charged in
finance costs.
The Group derecognizes financial liabilities when, and only when, the Group’s obligations
are discharged or canceled after the settlement by the Group has been made. The carrying amount
of the financial instruments are reclassified to equity when and only when, the Group’s obligation
(i.e. the redemption obligation) have expired, with the corresponding credit to the treasury stocks.
2.2.14 Cash and cash equivalents
For the purpose of presentation in the consolidated statements of cash flows, cash and cash
equivalents include deposits held at call with financial institutions, other short-term, highly liquid
investments with original maturities of three months or less that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 557 ---
2.2.15 Paid-in capital/Share capital and treasury stocks
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in
equity as a deduction, net of tax, from the proceeds.
Treasury stocks are equity instruments deducted from equity when the Group reacquires its
own equity instruments.
The ordinary shares with preferred rights are recognized as paid-in capital/share capital with
the excess of the nominal values of the shares in capital reserve upon the proceed received, and
initially reclassified from equity to financial liabilities (i.e. financial instruments with preferred
rights at amortized cost) with the corresponding debit to the treasury stocks.
2.2.16 Trade and notes payables
These amounts represent liabilities for goods and services provided to the Group prior to the
end of financial year/period which are unpaid. Trade and notes payables are classified as current
liabilities unless payment is not due within 12 months after each reporting period. They are
recognized initially at their fair value and subsequently measured at amortized cost using the
effective interest method.
2.2.17 Borrowings
Borrowings are initially recognized at fair value, net of transaction costs incurred.
Borrowings are subsequently measured at amortized cost. Any difference between the proceeds
(net of transaction costs) and the redemption amount is recognized in profit and loss over the
period of the borrowings using the effective interest method. Fees paid on the establishment of
loan facilities are recognized as transaction costs of the loan to the extent that it is probable that
some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down
occurs. To the extent there is no evidence that it is probable that some or all of the facility will be
drawn down, the fee is capitalized as a prepayment for liquidity services and amortized over the
period of the facility to which it relates.
Borrowings are derecognized from the consolidated statements of financial position when the
obligation specified in the contract is discharged, cancelled or expired. The difference between the
carrying amount of a financial liability that has been extinguished or transferred to another party
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 558 ---
and the consideration paid, including any non-cash assets transferred or liabilities assumed, is
recognized in the consolidated statements of profit or loss and other comprehensive income as
finance costs.
Borrowings are classified as current liabilities unless the Group has an unconditional right to
defer settlement of the liability for at least 12 months after each reporting period.
2.2.18 Borrowings costs
General and specific borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset are capitalized during the period of time that is
required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets
that necessarily take a substantial period of time to get ready for their intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.
Other borrowing costs are expensed in the period in which they are incurred.
2.2.19 Employee benefits
(a) Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits and other allowances that
are expected to be settled wholly within 12 months after the end of the period in which the
employees render the related service are recognized in respect of employees’ services up to the end
of each reporting period and are measured at the amounts expected to be paid when the liabilities
are settled. The liabilities are presented as current employee benefit obligations in the consolidated
statements of financial position.
(b) Pension obligations
Employees of the Group are covered by various government-sponsored defined-contribution
pension plans under which the employees are entitled to a monthly pension based on certain
formulas. The relevant government agencies are responsible for the pension liability to these
employees when they retire. The Group contributes on a monthly basis to these pension plans for
the employees which are determined at a certain percentage of their salaries. Under these plans,
the Group has no obligation for post-retirement benefits beyond the contribution made.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 559 ---
Contributions to these plans are expensed as incurred and contributions paid to the defined
contribution pension plans for a staff are not available to reduce the Group’s future obligations to
such defined-contribution pension plans even if the staff leaves the Group.
(c) Housing funds, medical insurances and other social insurances
The employees of the Group in the PRC are entitled to participate in various
government-supervised housing funds, medical insurance and other employee social insurance
plan. The Group contributes on a monthly basis to these funds based on certain percentages of the
salaries of the employees, subject to certain ceiling. The Group’s liability in respect of these funds
is limited to the contributions payable in each period. Contributions to the housing funds, medical
insurances and other social insurances are expensed as incurred.
(d) Bonus plan
The expected cost of bonuses is recognized as a liability when the Group has a present legal
or constructive obligation for payment of bonus as a result of services rendered by employees and
a reliable estimate of the obligation can be made. Liabilities for bonus plans are expected to be
settled within 1 year and are measured at the amounts expected to be paid when they are settled.
(e) Termination benefits
Termination benefits are payable when employment is terminated by the Group before the
normal retirement date, or when an employee accepts voluntary redundancy in exchange for these
benefits. The Group recognizes termination benefits at the earlier of the following dates: (a) when
the Group can no longer withdraw the offer of those benefits; and (b) when the entity recognizes
costs for a restructuring that is within the scope of IAS 37 and involves the payment of
terminations benefits. In the case of an offer made to encourage voluntary redundancy, the
termination benefits are measured based on the number of employees expected to accept the offer.
Benefits falling due more than 12 months after the end of each reporting period are discounted to
present value.
2.2.20 Leases
The Group mainly leases buildings and a piece of leasehold land as lessee. Lease terms are
negotiated on an individual basis and contain various different terms and conditions.
Leases are recognized as a right-of-use asset and a corresponding liability at the date at which
the leased asset is available for use by the Group. Each lease payment is allocated between the
liability and finance cost. The finance cost is charged to profit or loss over the lease period so as
APPENDIX I ACCOUNTANTS’ REPORT
– I-38 –


--- page 560 ---
to produce a constant periodic rate of interest on the remaining balance of the liability for each
period. The right-of-use asset is depreciated over the shorter of the asset’s useful life and the lease
term on a straight-line basis.
Lease payments to be made under reasonably certain extension options are also included in
the measurement of the liability.
Assets and liabilities arising from a lease are initially measured on a present value basis.
Lease liabilities include the net present value of the following lease payments (if applicable):
 fixed payments (including in-substance fixed payments), less any lease incentives
receivable;
 variable lease payment that are based on an index or a rate, initially measured using the
index or rate as at the commencement date;
 amounts expected to be payable by the Group under residual value guarantees;
 the exercise price of a purchase option if the Group is reasonably certain to exercise that
option, and
 payments of penalties for terminating the lease, if the lease term reflects the Group
exercising that option.
Right-of-use assets are measured at cost comprising the following (if applicable):
 the amount of the initial measurement of lease liability;
 any lease payments made at or before the commencement date less any lease incentives
received;
 any initial direct costs, and
 restoration costs.
The lease payments are discounted using the interest rate implicit in the lease. If that rate
cannot be readily determined, which is generally the case for leases in the Group, the lessee’s
incremental borrowing rate is used, being the rate that the individual lessee would have to pay to
borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar
economic environment with similar terms, security and conditions.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 561 ---
To determine the incremental borrowing rate, the Group:
 where possible, uses recent third-party financing received by the individual lessee as a
starting point, adjusted to reflect changes in financing conditions since third party
financing was received;
 uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk
for leases held by the Group, which does not have recent third party financing, and
 makes adjustments specific to the lease, e.g., term, country, currency and security.
For a lease modification that is not accounted for as a separate lease, the Group accounts for
the remeasurement of the lease liability by decreasing the carrying amount of the right-of-use asset
to reflect the partial or full termination of the lease for lease modifications that decrease the scope
of the lease and making a corresponding adjustment to the right-of-use asset for all other lease
modifications. The Group recognizes in profit or loss any gain or loss relating to the partial or full
termination of the lease.
Payments associated with short-term leases are recognized on a straight-line basis as an
expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less
without a purchase option.
2.2.21 Government grants
Grants from the government are recognized at their fair value where there is a reasonable
assurance that the grant will be received, and the Group will comply with all attached conditions.
For government grants based on the performance appraisal, if the relevant department has the
rights to suspend or recover the grants, the government grants will be recognized in the
consolidated statements of financial position as “Deferred income” when received. If the
performance appraisal are achieved, the government grants will be transferred in the consolidated
statements of profit or loss and other comprehensive income as “Other income”. If subsequently
some or the entire amount becomes repayable unexpectedly, the repayment is accounted for as a
change in estimate and the repayable portion of the credit previously recognized is reversed and
recognized in the period in which the Group concludes that it is no longer reasonably assured that
the terms for forgiveness will be met.
APPENDIX I ACCOUNTANTS’ REPORT
– I-40 –


--- page 562 ---
2.2.22 Finance income
Interest income is presented as the finance income where it is earned from financial assets at
FVTPL, trade receivables with significant financing components, bank deposits, term deposits,
loans to a third party and loan to a related party of the Company, see Note 12 below.
Interest income is calculated by applying the effective interest rate to the gross carrying
amount of a financial asset except for financial assets that subsequently become credit impaired.
For credit-impaired financial assets the effective interest rate is applied to the net carrying amount
of the financial asset (after deduction of the loss allowance).
2.2.23 Loss per share
(i) Basic loss per share
Basic loss per share is calculated by dividing:
 the loss attributable to equity holders of the Company, and
 by the weighted average number of ordinary shares outstanding during the financial
year/period.
(ii) Diluted loss per share
Diluted loss per share adjusts the figures used in the determination of basic loss per share to
take into account:
 the after-income tax effect of interest and other financing costs associated with dilutive
potential ordinary shares, and
 the weighted average number of additional ordinary shares that would have been
outstanding assuming the conversion of all dilutive potential ordinary shares.
2.2.24 Provision
Provision for product warranties is recognized when the Group has a present legal or
constructive obligation as a result of past events, it is probable that an outflow of resources will be
required to settle the obligation, and the amount can be reliably estimated. Provision is not
recognized for future operating losses.
APPENDIX I ACCOUNTANTS’ REPORT
– I-41 –


--- page 563 ---
Where there are a number of similar obligations, the likelihood that an outflow will be
required in settlement is determined by considering the class of obligations as a whole. A provision
is recognized even if the likelihood of an outflow with respect to any one item included in the
same class of obligations may be small.
Provision is measured at the present value of management’s best estimate of the expenditure
required to settle the present obligation at the end of each reporting period.
2.2.25 Share-based payment
The fair value of awarded shares granted to employees and consultants under the share option
scheme less amount paid by employees and consultants is recognized as an employee benefits
expense over the relevant service period, being the vesting period of the shares, and the credit is
recognized in equity in the employee share-based compensation reserve. The fair value of the
shares is measured at the grant date. The total amount to be expensed is determined by reference
to the fair value of the equity instruments granted:
 including any market performance conditions;
 excluding the impact of any service and non-market performance vesting conditions; and
 including the impact of any non-vesting conditions.
The total expense is recognized over the vesting period, which is the period over which all of
the specified vesting conditions are to be satisfied. At the end of each reporting period, the Group
revises its estimates of the number of shares that are expected to vest based on the service
conditions. It recognizes the impact of the revision to original estimates, if any, in profit or loss,
with a corresponding adjustment to equity.
Where there is any modification of terms and conditions which increases the fair value of the
equity instruments granted, the Group includes the incremental fair value granted in the
measurement of the amount recognized for the services received over the remainder of the vesting
period. The incremental fair value is the difference between the fair value of the modified equity
instrument and that of the original equity instrument, both estimated as at the date of the
modification. An expense based on the incremental fair value is recognized over the period from
the modification date to the date when the modified equity instruments vest in addition to any
amount in respect of the original instrument, which should continue to be recognized over the
remainder of the original vesting period. Where shares are forfeited due to a failure by the
employee to satisfy the service conditions, any expenses previously recognized in relation to such
shares are reversed effective at the date of the forfeiture.
APPENDIX I ACCOUNTANTS’ REPORT
– I-42 –


--- page 564 ---
The grant of share-based payments by the shareholders to the employees of the subsidiaries
are treated as a capital contribution to subsidiaries in the separate financial statements of the
Company. The fair value of employee services received, determined by reference to the grant date
fair value, is recognized over the vesting period as an increase to investments in subsidiaries
undertakings, with a corresponding adjustment to equity in the separate financial statements of the
Company.
3 FINANCIAL RISK MANAGEMENT
3.1 Financial risk factors
The Group’s activities expose it to a variety of financial risks: mainly market risk, credit risk
and liquidity risk. The Group’s overall risk management program focuses on the unpredictability of
financial markets and seeks to minimize potential adverse effects on the Group’s financial
performance.
(a) Market risk
(i) Foreign exchange risk
Foreign exchange risk arises from future commercial transactions and recognized assets and
liabilities denominated in a currency that is not the functional currency of the relevant group
entity. The Group’s businesses are principally conducted in RMB.
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the
Group was not exposed to significant foreign exchange risk. The Group regularly monitors its
foreign exchange risk to ensure there is no undue exposure to significant foreign exchange risk.
(ii) Cash flow and fair value interest rate risk
The Group’s interest rate risk primarily arises from borrowings, financial instruments with
preferred rights at amortized cost, financial assets measured at FVTPL, cash and cash equivalents,
restricted bank deposits and term deposits. Those carried at floating rates expose the Group to cash
flow interest rate risk whereas those carried at fixed rates expose the Group to fair value interest
rate risk. The interest rates and terms of repayments of borrowings are disclosed in Note 28. The
Group did not use any interest rate swap contracts or other financial instruments to hedge against
its interest rate risk for each reporting period.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 565 ---
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the
Group was not exposed to significant interest rate risk. The Group regularly monitors its interest
rate risk to ensure there is no undue exposure to significant interest rate risk.
(b) Credit risk
The Group is exposed to credit risk in relation to its cash and cash equivalents, restricted
bank deposits, term deposits, trade and notes receivables, contract assets, other receivables,
financial assets at FVTOCI and financial guarantee contracts liability. The carrying amount of each
class of the above assets represents the Group’s maximum exposure to credit risk in relation to the
corresponding class of assets.
(i) Credit risk of cash and cash equivalents, restricted bank deposits and term deposits
To manage this risk, the Group’s domestic subsidiaries only make transactions with
state-owned banks or reputable commercial banks which are all high-credit-quality financial
institutions. There has been no recent history of default in relation to these financial institutions.
These instruments are considered to have low credit risk because they have a low risk of default
and the counterparty has a strong capacity to meet its contractual cash flow obligations in the near
term. The credit losses are assessed to be immaterial.
(ii) Credit risk of trade and notes receivables and contract assets
The Group applies the IFRS 9 simplified approach to measure expected credit losses which
uses a lifetime expected loss allowance for trade receivables without a significant financing
component and contract assets. To measure the expected credit losses, other than trade receivables
with significant financing components that are subject to individual evaluation, trade receivables
and contract assets have been grouped based on shared credit risk characteristics and aging.
The expected loss rates are based on the credit rating of counter parties and the payment
profiles of sales over a period of each reporting period and probability of default of counter parties
on an ongoing basis throughout each reporting period. The historical loss rates are adjusted to
reflect current and forward-looking information on macroeconomic factors affecting the ability of
the customers to settle the receivables. The Group has identified the Gross Domestic Product
(“GDP”) and the growth rate of information technology industry to be the most relevant factor in
Mainland China in the credit risk assessment, and accordingly adjusts the historical loss rates
based on expected changes in these factors.
APPENDIX I ACCOUNTANTS’ REPORT
– I-44 –


--- page 566 ---
Notes receivables were mainly bank acceptance notes aged less than six months. The Group
measures credit risk using probability of default, exposure at default and loss given default. As at
31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the expected credit
loss for bank acceptance notes receivables is RMB0.08 million, RMB0.11 million, RMB0.14
million and RMB1.42 million respectively.
The loss allowance of trade receivables and contract assets as at 31 December 2022, 31
December 2023, 31 December 2024 and 30 June 2025 was determined as follows:
As at 31 December 2022, the loss allowance of trade receivables and contract assets assessed
under collective basis is determined as follows:
Collective basis
Up to
3 months
3t o
6 months
6t o
9 months
9t o
12 months
over
12 months Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
31 December 2022
Gross carrying amount .... 29,886 12 466 82 7,847 38,293
Loss allowance .......... (5,273) (2) (82) (14) (2,298) (7,669)
Expected loss rate (in %) .. 17.64 17.64 17.64 17.64 29.29 20.03
As at 31 December 2023, the loss allowance of trade receivables and contract assets assessed
under collective basis is determined as follows:
Collective basis
Up to
3 months
3t o
6 months
6t o
9 months
9t o
12 months
over
12 months Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
31 December 2023
Gross carrying amount .... 39,820 2,055 7,481 2,558 11,647 63,561
Loss allowance .......... (977) (50) (183) (63) (2,136) (3,409)
Expected loss rate (in %) .. 2.45 2.45 2.45 2.45 18.54 5.36
In the opinion of directors, the expected loss rate decreased due to the improving financial
positions of these debtors.
APPENDIX I ACCOUNTANTS’ REPORT
– I-45 –


--- page 567 ---
As at 31 December 2024, the loss allowance of trade receivables and contract assets assessed
under collective basis is determined as follows:
Collective basis
Up to
3 months
3t o
6 months
6t o
9 months
9t o
12 months
over
12 months Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
31 December 2024
Gross carrying amount .... 70,222 24,256 30,520 1,606 35,488 162,092
Loss allowance .......... (4,164) (1,438) (1,809) (95) (11,583) (19,089)
Expected loss rate (in %) .. 5.93 5.93 5.93 5.93 32.64 11.78
As at 30 June 2025, the loss allowance of trade receivables and contract assets assessed under
collective basis and individual basis is determined as follows:
Collective basis
Up to
3 months
3t o
6 months
6t o
9 months
9t o
12 months
over
12 months Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
30 June 2025
Gross carrying amount .... 166,319 3,316 41,478 22,856 68,204 302,173
Loss allowance .......... (10,802) (215) (2,694) (1,484) (22,871) (38,066)
Expected loss rate (in %) .. 6.49 6.49 6.49 6.49 33.53 12.60
Individual basis
Up to
3 months
3t o
6 months
6t o
9 months
9t o
12 months
over
12 months Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
30 June 2025
Gross carrying amount .... 164,747 ———— 164,747
Loss allowance .......... (7,048) ———— ( 7 , 048)
Expected loss rate (in %) .. 4 . 2 8———— 4 . 2 8
APPENDIX I ACCOUNTANTS’ REPORT
– I-46 –


--- page 568 ---
The movements in provision for impairment of trade receivables and contract assets are as
follows:
Y ear ended 31 December
Six months
ended 30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Loss allowance
At beginning of the year/period ...... 2,895 7,669 3,409 19,089
Provision/(reversal) for trade and
notes receivables and contract
assets, net .................... 4,774 (4,260) 15,680 26,149
Trade receivables written off ........ — — — (124)
At end of the year/period .......... 7,669 3,409 19,089 45,114
(iii) Credit risk of other receivables
Other receivables mainly comprise payments made on behalf of customers, amount due from
the third parties, amount due from the employee, deposits, loan to a third party and loans to the
employee. The management of the Group makes individual assessment on the recoverability of
payments made on behalf of customers, amount due from the third parties, amount due from the
employee, deposits, loan to a third party and loans to the employee based on historical settlement
records and past experiences. The Group measures credit risk using probability of default,
exposure at default and loss given default.
For impairment on payments made on behalf of customers, amount due from the third parties,
amount due from the employee, deposits, loan to a third party and loans to the employee, it is
measured as either 12-month expected credit losses or lifetime expected credit loss, depending on
whether there has been significant increase in credit risk since initial recognition. Other financial
assets that are not credit-impaired on initial recognition are classified in ‘Stage 1’ and the expected
credit losses are measured as 12-month expected credit losses. If a significant increase in credit
risk of other financial asset has occurred since initial recognition, the financial asset is moved to
‘Stage 2’ but is not yet deemed to be credit-impaired. The expected credit losses are measured as
lifetime expected credit loss. If any financial asset is credit-impaired, it is then moved to ‘Stage 3’
and the expected credit loss is measured as lifetime expected credit loss. Management makes
periodic collective assessments as well as individual assessment on these financial assets based on
historical settlement records and past experience.
APPENDIX I ACCOUNTANTS’ REPORT
– I-47 –


--- page 569 ---
On that basis, movements on the Group’s provision for impairment of other receivables are as
follows:
Y ear ended 31 December
Six months
ended 30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Provision for impairment
At beginning of the year/period ...... 35 275 726 7,785
Increase in provision for impairment
recognised in the consolidated
statements of profit or loss and
other comprehensive income (note) . 240 451 7,059 12,796
At end of the year/period .......... 275 726 7,785 20,581
Note: As at 30 June 2025, the directors of the Company have performed impairment assessment and concluded that there
has been significant increase in credit risk since initial recognition of the loans to the end customer, Anhui
Beishan (as defined in the note 31(e) to the Historical Financial Information). In making the assessment, the
Group considered Anhui Beishan is having significant financial difficulty and is unlikely to pay its creditors,
including the Group, in full, and concluded the default event has occurred. Accordingly, the loss allowance for
loans to the end customer provided by the Group is measured at an amount to lifetime expected credit losses.
Additional impairment loss of RMB12,796,000 has been recognized in the profit or loss during the period ended
30 June 2025.
(iv) Credit risk of financial assets at FVTOCI
Financial assets at FVTOCI comprise receivables financing. Receivables financing mainly
represents bills of acceptance issued by banks for the sale of goods. The Group expects that the
change of fair value associated with bank bills of acceptance is considered to be immaterial since
they have original maturities of six months or less and the accepting banks are state-owned banks
and other large listed banks with good reputation and high credit rating.
(v) Credit risk of financial guarantee contracts liability
The management of the Group makes individual assessment on the expected credit losses of
financial guarantee contracts. The Group measures credit risk using probability of default,
exposure at default and loss given default.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 570 ---
On that basis, movements on the Group’s expected credit losses of financial guarantee
contracts are as follow:
Y ear ended 31 December
Six months
ended 30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Provision for impairment
At beginning of the year/period ...... — — 186 6,452
Increase in provision for impairment
recognised in the consolidated
statements of profit or loss and
other comprehensive income (note) . — 186 6,266 44,063
At end of the year/period .......... — 186 6,452 50,515
Note: As at 30 June 2025, the directors of the Company have performed impairment assessment and concluded that there
has been significant increase in credit risk since initial recognition of the financial guarantee contracts entered
with Haitong Unitrust (as defined in the note 31(e) to the Historical Financial Information). In making the
assessment, the Group considered the heightened credit risk information of Anhui Beishan (as defined in the note
31(e) to the Historical Financial Information), including Anhui Beishan’s actual significant deterioration in the
financial condition and forward-looking information that is available without undue cost or effort. Accordingly, the
loss allowance for financial guarantee contracts issued by the Group is measured at an amount to lifetime expected
credit losses. Additional impairment loss of RMB44,063,000 has been recognized in the profit or loss during the
period ended 30 June 2025.
(c) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and cash equivalents
and the ability to raise funds through debt and equity financing. The Group historically financed
its working capital requirements through borrowing from bank, issue of financial instruments with
preferred rights at amortized cost (Note 29).
Management monitors rolling forecasts of the Group’s liquidity reserve on the basis of
expected cash flows.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 571 ---
The table below analyses the Group’s financial liabilities into relevant maturity groupings
based on the remaining period at each year/period end to the contractual maturity date for all
non-derivative financial liabilities. The amounts disclosed in the table are the contractual
undiscounted cash flows. Balances due within 12 months equal their carrying balances, as the
impact of discounting is immaterial.
Less than
1 year
Between 1 and
2 years
Between 2 and
5 years
Over
5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 31 December 2022
Trade and notes payables .......... 41,530 — — — 41,530
Other payables and accruals (excluding
repayable government grants, other tax
payables, payroll and welfare payables,
and accruals) (Note 31) .......... 41,185 — — — 41,185
Borrowings (including interest accrual up
to maturity) ................. 50,056 102,695 1,666 — 154,417
Lease liabilities ................ 4,698 1,271 664 — 6,633
As at 31 December 2023
Trade and notes payables .......... 70,689 — — — 70,689
Other payables and accruals (excluding
repayable government grants, other tax
payables, payroll and welfare payables,
and accruals) (Note 31) .......... 78,452 — — — 78,452
Borrowings (including interest accrual up
to maturity) ................. 127,137 3,830 — — 130,967
Lease liabilities ................ 3,050 614 — — 3,664
As at 31 December 2024
Trade and notes payables .......... 63,299 — — — 63,299
Other payables and accruals (excluding
repayable government grants, other tax
payables, payroll and welfare payables,
and accruals) (Note 31) .......... 68,327 — — — 68,327
Borrowings (including interest accrual up
to maturity) ................. 159,715 38,295 48,764 — 246,774
Lease liabilities ................ 3,701 338 — —
4,039
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 572 ---
Less than
1 year
Between 1 and
2 years
Between 2 and
5 years
Over
5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 30 June 2025
Trade and notes payables .......... 379,674 20,354 — — 400,028
Other payables and accruals (excluding
repayable government grants, other tax
payables, payroll and welfare payables,
and accruals) (Note 31) .......... 115,431 — — — 115,431
Borrowings (including interest accrual up
to maturity) ................. 238,089 74,718 23,154 — 335,961
Lease liabilities ................ 6,014 181 — — 6,195
For financial instruments with preferred rights at amortized cost, please refer to Note 29 for
more details.
3.2 Capital management
The Group’s objectives when managing capital are to safeguard the Group’s ability to
continue as a going concern in order to provide returns for equity holders and to maintain an
optimal capital structure to reduce the cost of capital.
The Group monitors capital by regularly reviewing the capital structure. As a part of this
review, management of the Company considers the cost of capital and the risks associated with the
paid-in capital. The Group may adjust the amounts of dividends paid to equity holders, return
capital to equity holders, issue new shares or repurchase the Company’s shares.
The Group considers the cost of capital and the risks associated with each class of capital and
will balance its overall capital structure through the plans and measures as described in Note 2.1 to
the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 573 ---
3.3 Fair value estimation
(a) Fair value hierarchy
This section explains the judgements and estimates made in determining the fair values of the
financial instruments that are recognized and measured at fair value in the Historical Financial
Information. To provide an indication about the reliability of the inputs used in determining fair
value, the Group has classified its financial instruments into the three levels prescribed under IFRS
Accounting Standards.
(i) Level 1: The fair value of financial instruments traded in active markets is based on
quoted market prices at the end of each reporting period. The quoted market price used
for financial assets held by the Group is the current bid price. These instruments are
included in level 1.
(ii) Level 2: The fair value of financial instruments that are not traded in an active market
are determined using valuation techniques which maximize the use of observable market
data and rely as little as possible on entity-specific estimates. If all significant inputs
required to fair value an instrument are observable, the instrument is included in level 2.
(iii) Level 3: If one or more of the significant inputs is not based on observable market data,
the instrument is included in level 3.
There were no transfers between level 1, 2 and 3 for recurring fair value measurements
during the Track Record Period.
The carrying amounts of the financial assets and liabilities, which are measured at amortized
cost, approximated their fair value as at 31 December 2022, 31 December 2023, 31 December
2024 and 30 June 2025.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 574 ---
The following table presents the Group’s financial assets and liabilities that are measured at
fair value as at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025
respectively.
Level 1 Level 2 Level 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
As at 31 December 2022
Assets
Financial assets at FVTPL
— Unlisted equity investments ...... — — 525 525
— Structured deposits ............. — 30,130 — 30,130
Financial assets at FVTOCI
— Receivables financing ........... — — 395 395
— 30,130 920 31,050
Level 1 Level 2 Level 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
As at 31 December 2023
Assets
Financial assets at FVTPL
— Unlisted equity investments ...... — — 1,116 1,116
— Unlisted debt investment ........ — — 1,000 1,000
Financial assets at FVTOCI
— Receivables financing ........... — — 9,799 9,799
— — 11,915 11,915
APPENDIX I ACCOUNTANTS’ REPORT
– I-53 –


--- page 575 ---
Level 1 Level 2 Level 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
As at 31 December 2024
Assets
Financial assets at FVTPL
— Unlisted equity investments ...... — — 929 929
— Unlisted debt investment ........ — — 1,612 1,612
— Structure deposits .............. — 10,005 — 10,005
Financial assets at FVTOCI
— Receivables financing ........... — — 290 290
— 10,005 2,831 12,836
Level 1 Level 2 Level 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
As at 30 June 2025
Assets
Financial assets at FVTPL
— Unlisted equity investments ...... — — 1,022 1,022
— Unlisted debt investment ........ — — 2,376 2,376
Financial assets at FVTOCI
— Receivables financing ........... — — 18,543 18,543
— — 21,941 21,941
(b) V aluation techniques used to determine fair values
Specific valuation techniques used to value financial instruments include:
 Quoted market prices or dealer quotes for similar instruments; and
 Other technique, such as asset based approach, is used to determine fair value for the
remaining financial instrument.
There were no changes in valuation techniques during the Track Record Period.
APPENDIX I ACCOUNTANTS’ REPORT
– I-54 –


--- page 576 ---
(c) Fair value measurements using significant unobservable inputs (level 3)
The following table presents the movements in level 3 items for the years ended 31
December 2022 and 31 December 2023 and 31 December 2024 and the six months ended 30 June
2024 and 30 June 2025:
Financial assets
at FVTPL
Financial assets
at FVTOCI Total
RMB’000 RMB’000 RMB’000
As at 1 January 2022 ................. 67 556 623
Acquisitions ........................ 500 6,881 7,381
Disposals ........................... (41) (7,042) (7,083)
FV change .......................... (1) — (1)
As at 31 December 2022 .............. 525 395 920
As at 1 January 2023 ................. 525 395 920
Acquisitions ........................ 1,000 20,774 21,774
Disposals ........................... — (11,370) (11,370)
FV change .......................... 591 — 591
As at 31 December 2023 .............. 2,116 9,799 11,915
As at 1 January 2024 ................. 2,116 9,799 11,915
Acquisitions ........................ 500 62,705 63,205
Disposals ........................... — (72,214) (72,214)
FV change .......................... (75) — (75)
As at 31 December 2024 .............. 2,541 290 2,831
As at 1 January 2024 ................. 2,116 9,799 11,915
Acquisitions ........................ — 41,675 41,675
Disposals ........................... — (44,721) (44,721)
FV change .......................... (102) — (102)
As at 30 June 2024 (Unaudited) ........ 2,014 6,753 8,767
As at 1 January 2025 ................. 2,541 290 2,831
Acquisitions ........................ 500 92,825 93,325
Disposals ........................... — (74,572) (74,572)
FV change .......................... 357 — 357
As at 30 June 2025 .................. 3,398 18,543 21,941
APPENDIX I ACCOUNTANTS’ REPORT
– I-55 –


--- page 577 ---
(d) V aluation inputs and relationships to fair value
The following table summarises the quantitative information about the significant
unobservable inputs used in recurring level 3 fair value measurements.
Description Fair value
Valuation techniques
and key inputs
Significant
unobservable inputs
Relationship of key
assumptions to fair value
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets at
FVTPL
Unlisted equity
investments .....
525 1,116 929 1,022 Fair values are
estimated based on
market approach of
underlying
investment.
Equity value
(31 December 2022:
RMB13,500,000,
31 December 2023:
RMB30,131,000,
31 December 2024:
RMB25,080,000 and
30 June 2025:
RMB27,591,000).
The higher the equity
value, the higher the
fair value.
Unlisted debt
investment .....
— 1,000 1,612 2,376 Fair values are
estimated based on
market approach of
underlying
investment.
Equity value
(31 December 2023: N/A,
31 December 2024:
RMB31,432,000 and
30 June 2025:
RMB36,590,000).
The higher the equity
value, the higher the
fair value.
Financial assets at
FVTOCI
Receivables
financing ......
395 9,799 290 18,543 Present value of the
contracted cash
inflow of the discount
rate that reflect the
market credit risk.
N/A N/A
APPENDIX I ACCOUNTANTS’ REPORT
– I-56 –


--- page 578 ---
For unlisted equity investments: as at 31 December 2022, 31 December 2023, 31 December
2024 and 30 June 2025, if equity value higher/lower by 10%, fair value of financial assets at
FVTPL would have been approximately RMB50,000, RMB112,000, RMB93,000 and RMB102,000
higher/lower respectively.
For unlisted debt investment: as at 31 December 2024 and 30 June 2025, if equity value
higher/lower by 10%, fair value of financial assets at FVTPL would have been approximately
RMB161,000 and RMB246,000 higher/lower respectively. As at 31 December 2023, the net assets
value of the underlying investments of the unlisted debt investment mainly consist of cash.
The receivables financing of the Group mainly consists of bank acceptance bills of the
reputable banks in the PRC which contains 6 state-owned banks and 9 listed joint-stock
commercial banks. The receivables financing is relatively high credit ratings with the short
remaining terms. The Group considers that the fair value of receivables financing approximately
equals to its contracted face value.
4 CRITICAL ESTIMATES AND JUDGEMENTS
The preparation of the Historical Financial Information requires the use of accounting
estimates which, by definition, will seldom exactly equal the actual results. Management also
needs to exercise judgment in applying the Group’s accounting policies.
Estimates and judgements are continually evaluated. They are based on historical experience
and other factors, including expectations of future events that may have a financial impact on the
entity and that are believed to be reasonable under the circumstances. The estimates and
assumptions that have a significant risk of causing a material adjustment to the carrying amounts
of assets and liabilities within the next twelve months period are addressed below.
(a) Estimation of the fair value of financial assets at FVTPL
The fair value of financial assets that are not traded in an active market is determined by
using valuation techniques. The Group uses its judgment to select a variety of methods and make
assumptions that are mainly based on market conditions existing at the end of each reporting
period, Changes in these assumptions and estimates could materially affect the respective fair
value of these investments. Details of the assumptions and estimates in determination of the fair
value are disclosed in Note 3.3.
APPENDIX I ACCOUNTANTS’ REPORT
– I-57 –


--- page 579 ---
(b) Principal versus agent considerations
Determining whether the Group is acting as a principal or as an agent in the provision of
certain services to its customers requires judgment and consideration of all relevant facts and
circumstances. In evaluation of the Group’s role as a principal or agent, the Group considers,
individually or in combination, whether the Group (i) controls the specified good or service before
it is transferred to the customer, (ii) is primarily responsible for fulfilling the contract, (iii) is
subject to inventory risk, and (iv) has discretion in establishing prices.
(c) Inventory provision
Inventories are stated at the lower of cost and net realizable value as stated in Note 2.2.1.
The net realizable value is the estimated selling price in the ordinary course of business less the
estimated costs of completion and the estimated costs necessary to make the sale. Even though the
management of the Group has made the best estimate about the inventory write-down loss
predicted to occur and provided allowance for write-down, the write-down assessment may still be
significantly changed due to the change of market situations.
(d) Income taxes and deferred income taxes
There are certain transactions and calculations for which the ultimate tax determination is
uncertain during the ordinary course of business. Where the final tax outcome of these matters is
different from the amounts that were initially recorded, such differences will impact the current
and deferred income tax assets and liabilities in the period in which such determination is made.
The Group recognizes deferred tax assets based on estimates that is probable to generate
sufficient taxable profits in the foreseeable future against which the deductible losses will be
utilized. The recognition of deferred tax assets mainly involved management’s judgements and
estimations about the timing and the amount of taxable profits of the companies who had tax
losses. During the Track Record Period, in the opinion of directors, deferred tax assets have been
recognized in respect of these accumulated tax losses and other deductible temporary differences
based on the fact that the Group is probable to generate sufficient taxable profits in the foreseeable
future.
(e) Warranty provision
The Group provides product warranties on all new goods based on the contracts with its
customers at the time of sale of goods. The Group accrues a warranty reserve for the goods sold
by multiplying the expected unit costs for warranty services by the sales volume, which includes
the best estimate of projected costs to repair or replace items under warranties. These estimates are
APPENDIX I ACCOUNTANTS’ REPORT
– I-58 –


--- page 580 ---
primarily based on the estimates of the nature, frequency and average costs of future claims. These
estimates are inherently uncertain given the Group’s relatively short history of sales, and changes
to the historical or projected warranty experience may cause material changes to the warranty
provision in the future. Warranty cost is recorded as a component of cost of sales in the
consolidated statements of profit or loss and other comprehensive income. The Group re-evaluates
the adequacy of the warranty accrual on a regular basis.
(f) Impairment assessment of financial assets and financial guarantee contracts liability
The loss allowances for financial assets at amortized cost, contract assets and financial
guarantee contracts liability are based on assumptions about risk of default and expected loss rates.
The Group uses judgement in making these assumptions and selecting the inputs to the impairment
calculation, based on the Group’s past history, existing market conditions as well as forward
looking estimates at the end of each reporting period. Details are disclosed in Note 3.1(b).
(g) Impairment assessment of non-financial assets
Non-financial assets are reviewed for impairment, whenever events or changes in
circumstances that may cause the carrying amounts of the assets to exceed their recoverable
amounts. The recoverable amount of an asset or a cash generating unit is determined as the higher
of their unit’s fair value less cost of disposal and its value-in-use which requires the use of
assumptions and estimates.
5 SEGMENT INFORMATION
The executive directors of the Company have been identified as the chief operating decision
maker of the Group who reviews the operating results of the Group’s business as one operating
segment to make strategic decisions and resources allocation. Therefore, the Group regards that
there is only one segment which is used to make strategic decisions.
No geographical segment information is presented as the majority of the revenue and
operating losses of the Group are derived within PRC and the majority of the operating assets of
the Group are located in the PRC, which is considered as one geographic location with similar
risks and returns.
APPENDIX I ACCOUNTANTS’ REPORT
– I-59 –


--- page 581 ---
Revenue from customers contributing over 10% of the total revenue of the Group during the
years ended 31 December 2022, 31 December 2023 and 31 December 2024 and six months ended
30 June 2025 is as follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
(Unaudited)
Customer A ................... — — 37% 59% —
Customer B ................... 7 8 %————
Customer C ................... — 31% 11% — —
Customer D .................. —1 1 %1 1 % * *
Customer E ................... — — 15% 23% —
Customer F ................... ———— 4 7 %
Customer G .................. ———— 1 9 %
Customer H .................. ———— 2 0 %
* Less than 10%
6 REVENUE
(a) Disaggregation of revenue from contracts with customers
Revenue for the years ended 31 December 2022, 31 December 2023, 31 December 2024 and
six months ended 30 June 2024 and 30 June 2025 are as follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Revenue from customers and
recognized at point in time
Autonomous driving
— Autonomous mining products and
solutions ................. 27,187 64,132 246,635 152,456 375,820
— Autonomous logistics trucks solutions . 811 10,286 8,252 3,587 2,544
27,998 74,418 254,887 156,043 378,364
V2X products and solutions ......... 3,058 36,812 101,591 74,237 9,179
Intelligent perception ............. — 21,374 53,557 28,181 20,493
31,056 132,604 410,035 258,461 408,036
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 582 ---
Revenue on a gross or net basis for the years ended 31 December 2022, 31 December 2023,
31 December 2024 and six months ended 30 June 2024 and 30 June 2025 are as follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
On a gross basis ................ 31,056 131,556 408,894 258,273 407,646
On a net basis ................. — 1,048 1,141 188 390
31,056 132,604 410,035 258,461 408,036
Revenue by location of the customers for the years ended 31 December 2022, 31 December
2023, 31 December 2024 and six months ended 30 June 2024 and 30 June 2025 are as follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
East China ................... 25,116 27,337 195,146 155,248 3,639
South-Central China ............. 4,171 59,928 85,371 9,095 18,704
Southwest China ................ 177 18,685 108,336 81,942 19,490
Northwest China ................ — 23 9,402 3,587 93,951
Northern China ................ 1,592 26,512 11,725 8,589 272,037
Northeast China ................ — 119 55 — —
Overseas .................... ———— 2 1 5
31,056 132,604 410,035 258,461 408,036
(b) Contract liabilities
During the Track Record Period, the additions to the contract liabilities were primarily due to
cash collections in advance of fulfilling performance obligations, while the reductions to the
contract liability balance were primarily due to the recognition of revenues upon fulfilment of
performance obligations.
The Group
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the
Group recognized contract liabilities of RMB46,757,000, RMB86,124,000, RMB42,011,000 and
RMB49,314,000, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-61 –


--- page 583 ---
The following table shows how much of the revenue recognized during the Track Record
Period is included in the contract liabilities:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Revenue recognized that was included in
the contract liability balance at the
beginning of the year/period ....... 918 24,141 60,803 36,570 12,201
The Company
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the
Company recognized contract liabilities of RMB39,822,000, RMB67,623,000, RMB21,750,000 and
RMB29,984,000, respectively.
The following table shows how much of the revenue recognized during the Track Record
Period is included in the contract liabilities:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Revenue recognized that was included in
the contract liability balance at the
beginning of the year/period ....... 617 17,213 59,731 34,631 9,965
(c) Transaction price allocated to the remaining performance obligations
The transaction price allocated to the remaining performance obligation (unsatisfied or
partially unsatisfied) as at 31 December 2022 and the expected timing of recognizing revenue are
as follows:
Autonomous
Driving
V2X products and
solutions
Intelligent
Perception
RMB’000 RMB’000 RMB’000
Within one year ...................... 45,794 33,101 5,840
More than one year but not more than
two years ......................... 8,216 72,819 —
More than two years .................. 696 2,675 —
54,706 108,595 5,840
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 584 ---
The transaction price allocated to the remaining performance obligation (unsatisfied or
partially unsatisfied) as at 31 December 2023 and the expected timing of recognizing revenue are
as follows:
Autonomous
Driving
V2X products and
solutions
Intelligent
Perception
RMB’000 RMB’000 RMB’000
Within one year ...................... 206,930 102,520 29,346
More than one year but not more than
two years ......................... 1,367 18,157 33,189
More than two years .................. 512 2,576 52,410
208,809 123,253 114,945
The transaction price allocated to the remaining performance obligation (unsatisfied or
partially unsatisfied) as at 31 December 2024 and the expected timing of recognizing revenue are
as follows:
Autonomous
Driving
V2X products and
solutions
Intelligent
Perception
RMB’000 RMB’000 RMB’000
Within one year ...................... 742,356 31,289 114,963
More than one year but not more than
two years ......................... 440,225 1,433 151,358
More than two years .................. — 1,509 167,172
1,182,581 34,231 433,493
The transaction price allocated to the remaining performance obligation (unsatisfied or
partially unsatisfied) as at 30 June 2025 and the expected timing of recognizing revenue are as
follows:
Autonomous
Driving
V2X products and
solutions
Intelligent
Perception
RMB’000 RMB’000 RMB’000
Within one year ...................... 794,053 8,921 13,436
More than one year but not more than
two years ......................... 1,235,213 5,469 46,474
More than two years .................. 1,151,068 12,464 215,697
3,180,334 26,854 275,607
APPENDIX I ACCOUNTANTS’ REPORT
– I-63 –


--- page 585 ---
7 EXPENSES BY NATURE
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Employee benefits expenses (Note 8) ... 155,075 151,209 474,180 72,513 336,295
Raw materials and consumables used ... 28,209 79,931 254,806 178,370 315,438
Changes in inventories of contract costs
in progress,
consigned-processing-material and
finished goods ............... (15,224) (3,573) 6,184 9,071 (2,114)
Provision for inventories (Note 20) .... 5,235 11,825 3,673 753 985
Outsourcing labor costs ........... 477 512 1,427 1,328 2,229
Office and traveling expenses ........ 19,909 23,445 25,114 10,816 12,924
Depreciation of property, plant and
equipment (a) ................ 16,708 21,479 25,582 12,938 12,473
Amortization of intangible
assets (b) ................... 1,053 1,430 1,459 758 778
Depreciation of right-of-use
assets (c) ................... 5,966 7,116 7,612 4,016 3,708
Short-term lease expenses
(Note 17) ................... 287 1,463 346 172 364
Legal, consulting and other professional
fees ...................... 13,102 13,787 21,516 12,616 5,558
Marketing expenses .............. 7,358 11,146 15,500 12,806 13,034
Warranty .................... 970 4,366 12,282 10,886 18,905
Listing expenses ................ — — 11,896 — 9,379
Others ...................... 550 1,272 5,359 2,059 3,655
239,675 325,408 866,936 329,102 733,611
(a) Depreciation of the Group’s property, plant and equipment has been recognized as follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Research and development expenses .... 9,866 7,003 5,686 2,714 2,794
General and administrative expenses ... 4,578 12,308 18,906 9,739 9,327
Selling expenses ................ 1,377 1,420 730 360 185
Costs of inventories .............. 887 748 260 125 167
16,708 21,479 25,582 12,938 12,473
APPENDIX I ACCOUNTANTS’ REPORT
– I-64 –


--- page 586 ---
(b) Amortization of the Group’s intangible assets has been recognized as follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Research and development expenses .... 240 337 335 156 193
General and administrative expenses ... 813 1061 867 489 579
Selling expenses ................ — — 1 051
Cost of inventories .............. — 32 247 108 5
1,053 1,430 1,459 758 778
(c) Depreciation of the Group’s right-of-use assets has been recognized as follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Research and development expenses .... 3,031 2,667 2,683 1,439 1,654
General and administrative expenses ... 1,856 3,067 3,649 2,005 1,486
Selling expenses ................ 439 501 796 339 339
Cost of inventories .............. 640 881 484 233 229
5,966 7,116 7,612 4,016 3,708
8 EMPLOYEE BENEFIT EXPENSES
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Wages, salaries and bonuses ........ 115,737 111,477 111,843 50,370 48,829
Share-based compensation expenses
(Note 40) ................... — — 319,944 — 266,568
Pension obligations, housing funds,
medical insurances and other social
insurances .................. 28,742 30,247 31,468 15,130 16,268
Other employee benefit expenses ...... 10,596 9,485 10,925 7,013 4,630
155,075 151,209 474,180 72,513 336,295
APPENDIX I ACCOUNTANTS’ REPORT
– I-65 –


--- page 587 ---
(a) Pension obligations, housing funds, medical insurances and other social insurances
The Group is required to contribute a specified percentage of payroll costs, subject to certain
ceiling, as determined by local government authority to the pension obligations, housing funds,
medical insurances and other social insurances to fund the benefits. The Group’s full time
employees in the PRC are members of a state-managed retirement benefit schemes operated by the
PRC government and liabilities in respect of benefits schemes are limited to the contribution
payable in each year/period.
(b) Five highest paid individuals
The five individuals whose emoluments were the highest in the Group for the years ended 31
December 2022, 31 December 2023, 31 December 2024 and six months ended 30 June 2024 and
30 June 2025, include 2, 2, 2, 1 (unaudited) and 2 directors respectively, whose emoluments are
disclosed in Note 8(c). The emoluments payable to the remaining individuals during the years
ended 31 December 2022, 31 December 2023, 31 December 2024 and six months ended 30 June
2024 and 30 June 2025 are as follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Wages, salaries and bonuses ........ 3,354 3,209 4,015 2,834 1,308
Share-based compensation expenses .... — — 32,188 — 47,084
Pension obligations, housing funds,
medical insurances and other social
insurances .................. 263 310 357 235 187
3,617 3,519 36,560 3,069 48,579
APPENDIX I ACCOUNTANTS’ REPORT
– I-66 –


--- page 588 ---
The remaining highest paid individuals fell within the following bands:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
(Unaudited)
Emolument bands
HK$500,001 to HK$1,000,000 ....... ——— 2—
HK$1,000,001 to HK$1,500,000 ...... 33 —2 —
HK$4,000,001 to HK$4,500,000 ...... —— 1——
HK$12,000,001 to HK$12,500,000 .... ———— 1
HK$16,000,001 to HK$16,500,000 .... —— 1——
HK$18,000,001 to HK$18,500,000 .... ———— 1
HK$19,500,001 to HK$20,000,000 .... —— 1——
HK$21,500,001 to HK$22,000,000 .... ———— 1
33343
(c) Details of emoluments in respect of the directors and supervisors of the Company
The emoluments in respect of each of the directors and supervisors paid/payable by the
Group for the year ended 31 December 2022 are as follows:
Name Director’s fee
Wages and
salaries
Discretionary
bonuses
Social security
costs, housing
benefits and
employee
welfare
Share-based
compensation
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Directors
Mr. Ma Wei (Note i) ......... — 1,213 599 4 — 1,816
Mr. Ying Long (Note ii) ....... — 960 464 44 — 1,468
— 2,173 1,063 48 — 3,284
APPENDIX I ACCOUNTANTS’ REPORT
– I-67 –


--- page 589 ---
The emoluments in respect of each of the directors and supervisors paid/payable by the
Group for the year ended 31 December 2023 are as follows:
Name Director’s fee
Wages and
salaries
Discretionary
bonuses
Social security
costs, housing
benefits and
employee
welfare
Share-based
compensation
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Directors
Mr. Ma Wei (Note i) ......... — 2,400 653 15 — 3,068
Mr. Ying Long (Note ii) ....... — 1,040 128 12 — 1,180
Mr. Hu Albert Sibo (Note iii) .... — 180 61 38 — 279
— 3,620 842 65 — 4,527
The emoluments in respect of each of the directors and supervisors paid/payable by the
Group for the period ended 31 December 2024 are as follows:
Name Director’s fee
Wages and
salaries
Discretionary
bonuses
Social security
costs, housing
benefits and
employee
welfare
Share-based
compensation
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Directors
Mr. Ma Wei (Note i) ......... — 2,400 600 15 — 3,015
Mr. Hu Albert Sibo (Note iii) .... — 786 130 173 12,305 13,394
— 3,186 730 188 12,305 16,409
Supervisors
Mr. Zhu Jianneng (Note iv) ..... — 210 100 72 4,416 4,798
Mr. Sheng Weitian (Note v) ..... — 282 43 73 2,731 3,129
— 492 143 145 7,147 7,927
APPENDIX I ACCOUNTANTS’ REPORT
– I-68 –


--- page 590 ---
The emoluments in respect of each of the directors and supervisors paid/payable by the
Group for the period ended 30 June 2024 (unaudited) are as follows:
Name Director’s fee
Wages and
salaries
Discretionary
bonuses
Social security
costs, housing
benefits and
employee
welfare
Share-based
compensation
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
Directors
Mr. Ma Wei (Note i) ......... — 1,200 — 7 — 1,207
Mr. Hu Albert Sibo (Note iii) .... — 390 2 85 — 477
— 1,590 2 92 — 1,684
Supervisors
Mr. Zhu Jianneng (Note iv) ..... —3 0— 8—3 8
Mr. Sheng Weitian (Note v) ..... —4 0 3 8—5 1
—7 0 31 6—8 9
The emoluments in respect of each of the directors and supervisors paid/payable by the
Group for the period ended 30 June 2025 are as follows:
Name Director’s fee
Wages and
salaries
Discretionary
bonuses
Social security
costs, housing
benefits and
employee
welfare
Share-based
compensation
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Directors
Mr. Ma Wei (Note i) ......... — 1,200 7 7 — 1,214
Mr. Hu Albert Sibo (Note iii) .... — 450 2 87 13,877 14,416
— 1,650 9 94 13,877 15,630
Supervisors
Mr. Zhu Jianneng (Note iv) ..... — 210 — 55 4,360 4,625
Mr. Sheng Weitian (Note v) ..... — 246 1 56 3,184 3,487
— 456 1 111 7,544 8,112
APPENDIX I ACCOUNTANTS’ REPORT
– I-69 –


--- page 591 ---
Notes:
(i) Mr. Ma Wei was appointed as a director in October 2017.
(ii) Mr. Ying Long was appointed as a director in October 2017 and his appointment contract was terminated by the
board of directors in October 2023.
(iii) Mr. Hu Albert Sibo was appointed as a director in October 2023.
(iv) Mr. Zhu Jianneng was appointed as a supervisor in May 2024.
(v) Mr. Sheng Weitian was appointed as a supervisor in May 2024.
(d) Directors’ retirement benefits and termination benefits
No director’s retirement or termination benefit subsisted at the end of each year/period
disclosed or at any time during the Track Record Period.
(e) Consideration provided to third parties for making available directors’ services
No consideration provided to third parties for making available director’s services subsisted
at the end of each year/period disclosed or at any time during the Track Record Period.
(f) Information about borrowings, quasi-borrowings and other dealings in favour of
directors, controlled bodies corporate by and controlled entities with such directors
No borrowings, quasi-borrowings and other dealings in favor of directors, controlled bodies
corporate by and connected entities with such directors subsisted at the end of each year/period
disclosed or at any time during the Track Record Period.
(g) Directors’ material interest in transactions, arrangements or contracts
No significant transactions, arrangements and contracts in relation to the Group’s business to
which the Company was a party and in which a director of the Company had a material interest
whether directly or indirectly, subsisted at the end of each year/period disclosed or at any time
during the Track Record Period.
APPENDIX I ACCOUNTANTS’ REPORT
– I-70 –


--- page 592 ---
9 OTHER INCOME
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Government grants (a) ............ 7,265 10,979 5,096 3,494 730
Super-input value-added tax (“ VAT”)
credit (b) ................... — 18 2,215 2,161 1
Others ...................... 141 202 144 143 130
7,406 11,199 7,455 5,798 861
(a) The government grants mainly represent government subsidies for the Group’s research and development
expenditures.
(b) Super-input V AT credit amounted to Nil, RMB0.2 million, RMB2.2 million, RMB2.1 million (unaudited) and
RMB1 thousand for the years ended 31 December 2022, 31 December 2023, 31 December 2024 and six months
ended 30 June 2024 and 30 June 2025 was recognized in consolidated statements of profit or loss and other
comprehensive income due to the V AT reform. In accordance with Caishui 2023 No. 43 introduced by Ministry of
Finance (MOF) and State Taxation Administration (STA) for The People’s Republic of China, the Company meet
the requirement of the advanced manufacturing industry and are eligible for additional V AT credits by 5% of the
current period creditable V AT input from 1 January 2023 to 31 December 2027.
10 OTHER GAINS/(LOSSES), NET
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Change in fair value of financial assets
at FVTPL .................. 129 591 (70) (102) 396
Gain on lease termination .......... —9 08 0 7—
(Loss)/gain on disposal of/written off
property, plant and equipment ...... (15) 120 (20) (7) (1)
Foreign currency exchange gain/(loss) .. 1 — (9) — 6
115 801 (19) (102) 401
APPENDIX I ACCOUNTANTS’ REPORT
– I-71 –


--- page 593 ---
11 IMPAIRMENT LOSSES
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Impairment losses under ECL model,
net of reversal
Trade and notes receivables ......... (4,838) 4,131 (15,550) (1,832) (26,216)
Contract assets ................. (14) 95 (163) (283) (1,205)
Other receivables ............... (240) (451) (7,059) (274) (12,796)
Financial guarantee contracts liability ... — (186) (6,266) (2,891) (44,063)
(5,092) 3,589 (29,038) (5,280) (84,280)
Details of financial guarantee contract liability and impairment are set out in notes 31(e) and
3.1(b) to the Historical Financial Information, respectively.
12 FINANCE COSTS — NET
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Finance income:
Interest income from financial assets at
FVTPL .................... 258 11 — — 16
Interest income from trade receivables
with significant financing components . ———— 1,288
Interest income from bank deposits .... 4,424 2,866 2,187 1,087 668
Interest income from term deposits .... 4,276 5,215 2,499 2,124 74
Interest income from loans to a third
party ..................... — 71 377 161 221
Interest income from loan to a related
party of the Company ........... —1 6———
8,958 8,179 5,063 3,372 2,267
Finance costs:
Financial cost on financial instruments
with preferred rights at amortized cost
(Note 29) ................... (104,136) (117,528) (128,593) (63,119) (67,923)
Imputed interest expenses on trade
payables ................... ———— (982)
Interest expenses on other borrowings .. ———— (24)
Interest expenses on bank borrowings ... (1,156) (3,364) (6,958) (3,431) (4,558)
Interest expenses on lease liabilities .... (350) (208) (165) (68) (32)
(105,642) (121,100) (135,716) (66,618) (73,519)
Finance costs — net ............. (96,684) (112,921) (130,653) (63,246) (71,252)
APPENDIX I ACCOUNTANTS’ REPORT
– I-72 –


--- page 594 ---
13 INCOME TAX CREDIT
(a) Income tax credit
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Current tax ................... —9 2 3 — 1 1
Deferred tax (Note 19) ............ (39,877) (35,066) (28,335) (10,904) (24,770)
(39,877) (35,057) (28,312) (10,904) (24,759)
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.
Hong Kong
The Group’s subsidiary in Hong Kong is subject to Hong Kong profits tax of which the tax
rate was 16.5% up to 1 April 2018 when the two-tiered profits tax regime took effect, under which
the tax rate is 8.25% for assessable profits in the first Hong Kong Dollars (“ HKD”) 2 million and
16.5% for any assessable profits in excess. Since the subsidiary did not have assessable profits
during the Track Record Period, no Hong Kong profits tax has been provided.
Mainland China
In accordance with the Enterprise Income Tax Law (“ EIT Law ”), Foreign Investment
Enterprises (“ FIEs”) and domestic companies established in Mainland China are subject to
Enterprise Income Tax (“ EIT”) at a rate of 25%.
In December 2019, the Company was qualified as a High and New Technology enterprise
(“HNTE”) and enjoyed a preferential tax rate of 15% from December 2019 to December 2022. In
December 2022, the Company re-applies for HNTE status and the application was approved for
another three-year period from December 2022 to December 2025. In October 2022, Novodriv
Chongqing Ltd., the subsidiary of the Company, was qualified as a HNTE and enjoyed a
preferential tax rate of 15% from October 2022 to October 2025. The Company and Novodriv
Chongqing Ltd. were both in accumulated loss position for the years ended 31 December 2022, 31
December 2023, 31 December 2024 and six months ended 30 June 2025. Pursuant to the relevant
APPENDIX I ACCOUNTANTS’ REPORT
– I-73 –


--- page 595 ---
regulations on extension for expiries of unused tax losses of HNTE issued in August 2018, the
expiry period of the accumulated unexpired tax losses of the Company and Novodriv Chongqing
Ltd., which are qualified as HNTE, will expire in 10 years.
The subsidiary, Changsha CiDi Intelligent building Co., Ltd, incorporated in the PRC is
subject to an enterprise income tax at a rate of 25%.
In accordance with the Notice on Implementing the Inclusive Tax Deduction and Exemption
Policies for Micro and Small Enterprises (Cai Shui [2021] No. 12) jointly issued by the Ministry
of Finance and the State Taxation Administration of the PRC, from 1 January 2021 to 31
December 2022, the annual taxable income of a small low-profit enterprise that is not more than
RMB1 million shall be recognised at 12.5% of income and be subject to the corporate income tax
at a tax rate of 20%; in accordance with the Notice on Implementing the Inclusive Tax Deduction
and Exemption Policies for Micro and Small Enterprises (Cai Shui [2022] No. 13) jointly issued
by the Ministry of Finance and the State Taxation Administration of the PRC, from 1 January 2022
to 31 December 2024, the annual taxable income of a small low-profit enterprise that is more than
RMB1 million but no more than RMB3 million shall be recognised at 25% of income and be
subject to the corporate income tax at a tax rate of 20%; in accordance with the Notice on
Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small
Enterprises (Cai Shui [2023] No. 6) jointly issued by the Ministry of Finance and the State
Taxation Administration of the PRC, from 1 January 2023 to 31 December 2024, the annual
taxable income of a small low-profit enterprise that is not more than RMB1 million shall be
recognised at 25% of income and be subject to the corporate income tax at a tax rate of 20%; in
accordance with the Notice on Implementing the Inclusive Tax Deduction and Exemption Policies
for Micro and Small Enterprises (Cai Shui [2023] No. 12) jointly issued by the Ministry of
Finance and the State Taxation Administration of the PRC, the applicable period of preferential
policies related to Cai Shui [2023] No. 6 extended to 31 December 2027. The other subsidiaries
incorporated in the PRC are subject to an enterprise income tax at a rate of 5% from 2022 to 2025.
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 175% from 2018 onwards (subsequently raised to 200% from October 2022
onwards) of their research and development expenses incurred as tax deductible expenses when
determining their assessable profits for that year (the “ Super Deduction ”).
APPENDIX I ACCOUNTANTS’ REPORT
– I-74 –


--- page 596 ---
The income tax on the Group’s loss before income tax differs from the theoretical amount
that would arise using the enacted tax rate in the PRC applicable to the Group as follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Loss before income tax ........... (302,874) (290,136) (609,156) (133,471) (479,845)
Income tax credit computed at the
applicable income tax rate of 25% ... (75,719) (72,534) (152,289) (33,368) (119,961)
Tax effect of:
Preferential tax rate .............. 30,287 29,013 60,916 13,347 47,984
Difference in tax rates of subsidiaries ... 575 26 (470) (552) 62
Super Deduction in respect of research
and development (“ R&D”)
expenditures ................. (12,124) (12,097) (11,417) (4,857) (5,952)
Expenses not deductible for taxation
purpose .................... 16,771 18,117 68,750 11,377 49,966
Utilization of tax losses which no
deferred income tax assets was
recognized previously ........... — (40) — — —
Tax losses for which no deferred income
tax assets were recognized ........ 189 2,601 6,053 3,105 2,788
Temporary differences for which no
deferred income tax assets were
recognized .................. 144 (143) 145 44 354
Income tax credit ............... (39,877) (35,057) (28,312) (10,904) (24,759)
(i) Expenses not deductible for tax purposes mainly represent share-based compensation
expenses and financial cost on financial instruments with preferred rights at amortized
cost incurred in the Company and the Company’s subsidiaries in Mainland China which
are not deductible according to the relevant laws and regulations promulgated by the
State Tax Bureau of the PRC.
APPENDIX I ACCOUNTANTS’ REPORT
– I-75 –


--- page 597 ---
(b) Tax losses
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the
Group did not recognize deferred income tax assets in respect of losses of RMB5.50 million,
RMB18.83 million, RMB56.70 million and RMB71.65 million respectively. The tax losses
incurred from the Company’s subsidiaries in Mainland China that are not recognized as deferred
tax assets will expire from 2024 to 2030. Tax losses of the Company’s subsidiary incorporated in
Hong Kong will be carried forward indefinitely. Deductible losses that are not recognized for
deferred income tax assets will expire as follows:
As at 31 December As at 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Expiry year
2024 ....................... 226 225 225 225 225
2025 ....................... 468 466 466 466 466
2026 ....................... 1,200 ————
2027 ....................... 3,605 1,549 2,476 1,902 2,815
2028 ....................... — 16,593 16,591 16,593 16,590
2029 ....................... — — 36,941 16,795 36,947
2030 ....................... ———— 14,606
5,499 18,833 56,699 35,981 71,649
14 LOSS PER SHARE
(a) Basic loss per share
Basic loss per share for the years ended 31 December 2022, 31 December 2023, 31 December
2024 and six months ended 30 June 2024 and 30 June 2025 are calculated by dividing the loss
attributable to the Company’s equity holders by the weighted average number of ordinary shares in
issue during the respective years/periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-76 –


--- page 598 ---
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
(Unaudited)
Loss attributable to the equity holders of
the Company (RMB’000) ......... (262,997) (255,079) (580,709) (122,567) (454,486)
Weighted average number of ordinary
shares outstanding (thousand shares) .. 16,278 16,278 16,278 16,278 16,278
Basic loss per share (expressed in RMB
per share) .................. (16.16) (15.67) (35.67) (7.53) (27.92)
The weighted average number of ordinary shares in issue before the Company’s conversion
into a joint stock company was determined assuming (1) the paid-in capital of 38,279,000 shares
and 38,381,000 shares as at 31 December 2022 and 31 December 2023, respectively, had been
fully converted into the Company’s issued share capital at the same conversion ratio of 1:1 as upon
conversion into joint stock company in July 2024 as if they have been in issue since 1 January
2022 and (2) the contingently redeemable shares, being the ordinary shares after the conversion
into joint stock company classified as financial instruments with preferred rights at amortized cost
(Note 29), had been excluded. As at 31 December 2022, 2023 and 2024 and 30 June 2024 and
2025, the numbers of contingently redeemable shares are 22,001,000, 22,103,000, 22,103,000,
22,103,000 (unaudited) and 22,103,000, respectively.
(b) Diluted loss per share
Diluted loss per share is calculated by adjusting the weighted average number of ordinary
shares outstanding to assume conversion of all dilutive potential ordinary shares. For the years
ended 31 December 2022, 31 December 2023, 31 December 2024 and six months ended 30 June
2024 and 30 June 2025, financial instruments with preferred rights issued to investors (Note 29)
were not included in the calculation of diluted loss per share because they were antidilutive.
Accordingly, diluted loss per share for the years ended 31 December 2022, 31 December 2023, 31
December 2024 and six months ended 30 June 2024 and 30 June 2025 was the same as basic loss
per share for the respective year/periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-77 –


--- page 599 ---
15 SUBSIDIARIES
(a) Subsidiaries of the Company
During the Track Record Period and as at the date of this report, the Company has equity interests in the following subsidiaries:
Company Name
Place of Incorporation/
establishment and kind of
legal entity
Date of Incorporation/
establishment
Issued/Registered
Capital
Equity interest attributable to the Company
As at
31 December
2022
As at
31 December
2023
As at
31 December
2024
As at
30 June
2025
As at
report date Principal activities
Place of
operation Note
In thousand
ʮ̡
Novodriv Chongqing Ltd. ....
The PRC, limited
liability company
29 May 2020 RMB70,939 100% 100% 100% 100% 100% Research and
development
The PRC
ʮ̡
Tianjin CiDi Intelligent Network
Technology Co., Ltd .......
The PRC, limited
liability company
14 December 2020 RMB20,000 100% 100% 100% 100% 100% Research and
development
The PRC
ʮ̡
Changsha CiDi Sales Service Co.,
Ltd...............
The PRC, limited
liability company
14 May 2019 RMB5,000 100% N/A N/A N/A N/A Sales and marketing The PRC (b)
ப΂ʮ̡
Changsha CiDi Intelligent
Building Co., Ltd ........
The PRC, limited
liability company
29 July 2019 RMB3,000 100% 100% 100% 100% 100% Constructions The PRC (c)
౽ቷ(ϓே)ʮ̡
CiDi Intelligent Driving
(Chengdu) Technology Co., Ltd .
The PRC, limited
liability company
1 April 2022 RMB50,000 100% 100% 100% 100% 100% Sales and marketing The PRC
APPENDIX I ACCOUNTANTS’ REPORT
– I-78 –


--- page 600 ---
Company Name
Place of Incorporation/
establishment and kind of
legal entity
Date of Incorporation/
establishment
Issued/Registered
Capital
Equity interest attributable to the Company
As at
31 December
2022
As at
31 December
2023
As at
31 December
2024
As at
30 June
2025
As at
report date Principal activities
Place of
operation Note
In thousand
ʮ̡
Liuzhou CiDi Intelligent Driving
Technology Co., Ltd .......
The PRC, limited
liability company
17 May 2022 RMB10,000 100% 100% 100% 100% 100% Sales and marketing The PRC
ʮ̡
Xiangyang CiDi Intelligent
Network Technology Co., Ltd ..
The PRC, limited
liability company
8 October 2022 RMB20,000 100% 100% 100% 100% 100% Sales and marketing The PRC
ʮ̡
Shenzhen CiDi Intelligent
Network Technology Co., Ltd ..
The PRC, limited
liability company
23 February 2023 RMB4,000 N/A 100% 100% 86.84% 86.84% Sales and marketing The PRC (d)
ʮ̡
CiDi Intelligent Driving (Hainan)
Technology Co., Ltd .......
The PRC, limited
liability company
17 March 2023 RMB5,000 N/A 100% 100% 100% 100% Sales and marketing The PRC
CiDi Auto (Hong Kong) Limited .. Hong Kong, limited
liability company
9 November 2023 HKD1,000 N/A 100% 100% 100% 100% Sales and marketing Hong Kong (f)
ʮ̡ Anhui
CiDi Engineering Technology
Co., Ltd ............
The PRC, limited
liability company
4 June 2024 RMB5,000 N/A N/A 51% 51% 51% Sales and marketing The PRC (g)
ʮ̡
Guangxi CiDi Intelligent Driving
Technology Co., Ltd .......
The PRC, limited
liability company
5 June 2025 RMB40,000 N/A N/A N/A 100% 100% Sales and marketing The PRC
APPENDIX I ACCOUNTANTS’ REPORT
– I-79 –


--- page 601 ---
(a) The English name of the subsidiaries represents the best effort by the management of the Group in translating their Chinese names as they do not have an official
English name.
(b) Changsha CiDi Sales Service Co., Ltd was deregistered in November 2023.
(c) In April 2021, the registered capital of Changsha CiDi Intelligent Building Co., Ltd increased RMB1 million of the new shareholder,ʮ
̡. As at the reporting date,ʮ̡ has not yet paid the capital. According to the Articles of Association, the shareholders can enjoy the
shareholders’ rights after paying the capital, therefore Changsha CiDi Intelligent Building Co., Ltd was fully consolidated by the Company at each o f the reporting
periods during the Track Record Period.
(d) In February 2023, CiDi Inc. andʮ̡ entered into an agreement to set up a limited company, Shenzhen CiDi Intelligent Network
Technology Co., Ltd, which has a register capital of RMB4 million. As at 30 April 2025,ʮ̡ has paid RMB0.2 million of the register
capital, and the Company has paid RMB1.32 million of the register capital reducing its continuing interest to 86.84%. According to the Articles of Ass ociation, the
shareholders can enjoy the shareholders’ rights after paying the capital. An amount of RMB133,000 (being the proportionate share of the carrying amo unt of the net
assets of Shenzhen CiDi Intelligent Network Technology Co., Ltd) has been transferred to non-controlling interests. The difference of RMB67,000 be tween the
increase in the non-controlling interests and the consideration received of RMB0.2 million has been credited to share premium.
(e) The statutory financial statements of the PRC subsidiaries of Company have not yet been issued for the years ended 31 December 2022, 31 December 202 3 and 31
December 2024. There is no statutory requirement to issue the audit report for the PRC company.
(f) As at the reporting date, the statutory financial statements have not yet been issued for the year ended 31 December 2024 for CiDi Auto (Hong Kong) Li mited. The
statutory financial statements are not due to issue.
(g) In April 2025, the Company andʮ̡ entered into an agreement to set up a limited company, Anhui CiDi Engineering Technology Co.,
Ltd, which has a register capital of RMB5 million. As at 30 June 2025,ʮ̡ has not yet paid the capital. The equity interest attributable
to the Company is 51%.
(h) All the subsidiaries of the Company are directly held by the Company.
APPENDIX I ACCOUNTANTS’ REPORT
– I-80 –


--- page 602 ---
(b) Investments in subsidiaries
The Company As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Investments in subsidiaries,
at costs ...................... 103,939 119,259 126,908 137,008
Provisions for impairment .......... ————
103,939 119,259 126,908 137,008
16 PROPERTY, PLANT AND EQUIPMENT
The Group
Buildings Vehicles
Machinery
and
equipment
Office
equipment,
computers
and others
Tested field
and related
equipment
Construction
in progress
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Cost
As at 1 January 2022 ...... — 13,874 1,214 11,618 13,414 182,489 32,608 255,217
Additions ............ — 5,507 — 3,412 — 115,833 1,194 125,946
Transfer ............. ———— 1,650 (1,650) — —
Disposal ............. — (84) — (148) — — — (232)
As at 31 December 2022 and
1 January 2023 ........ — 19,297 1,214 14,882 15,064 296,672 33,802 380,931
Additions ............ — 3,200 26 1,246 — 14,620 3,456 22,548
Transfer ............. 308,718 — — — 194 (308,912) — —
Write off upon termination of
leasehold building ...... —————— (33,041) (33,041)
Disposal ............. — (584) — (17) — — — (601)
As at 31 December 2023 and
1 January 2024 ........ 308,718 21,913 1,240 16,111 15,258 2,380 4,217 369,837
Additions ............ — 113 — 880 — 1,442 — 2,435
Disposal ............. — (71) (26) (68) — — — (165)
Write off upon termination of
leasehold building ...... —————— (953) (953)
As at 31 December 2024 and
1 January 2025 ........ 308,718 21,955 1,214 16,923 15,258 3,822 3,264 371,154
Additions ............ — — 23 151 — — — 174
Disposal ............ — — — (22) — — — (22)
As at 30 June 2025 ....... 308,718 21,955 1,237 17,052 15,258 3,822 3,264
371,306
APPENDIX I ACCOUNTANTS’ REPORT
– I-81 –


--- page 603 ---
Buildings Vehicles
Machinery
and
equipment
Office
equipment,
computers
and others
Tested field
and related
equipment
Construction
in progress
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Depreciation and impairment
As at 1 January 2022 ...... — 4,928 254 5,049 837 — 21,466 32,534
Provided for the year ...... — 3,672 161 2,572 2,683 — 7,620 16,708
Disposal ............. — (62) — (5) — — — (67)
As at 31 December 2022 and
1 January 2023 ........ — 8,538 415 7,616 3,520 — 29,086 49,175
Provided for the year ...... 6,110 4,331 150 2,574 2,941 — 5,373 21,479
Disposal ............. — (568) — (1) — — — (569)
Write off upon termination of
leasehold building ...... —————— (33,040) (33,040)
As at 31 December 2023 and
1 January 2024 ........ 6,110 12,301 565 10,189 6,461 — 1,419 37,045
Provided for the year ...... 14,664 4,054 95 1,982 2,960 — 1,827 25,582
Disposal ............. — (69) (5) (58) — — — (132)
Write off upon termination of
leasehold building ...... —————— (953) (953)
As at 31 December 2024 and
1 January 2025 ....... 20,774 16,286 655 12,113 9,421 — 2,293 61,542
Provided for the period ..... 7,332 1,944 39 951 1,480 — 727 12,473
Disposal ............. — — — (22) — — — (22)
As at 30 June 2025 ....... 28,106 18,230 694 13,042 10,901 — 3,020 73,993
Net book value
As at 31 December 2022 .... — 10,759 799 7,266 11,544 296,672 4,716 331,756
As at 31 December 2023 .... 302,608 9,612 675 5,922 8,797 2,380 2,798 332,792
As at 31 December 2024 ... 287,944 5,669 559 4,810 5,837 3,822 971 309,612
As at 30 June 2025 ....... 280,612 3,725 543 4,010 4,357 3,822 244 297,313
In February 2025, a PRC court issued an asset preservation order on a building owned by the
Group. This order was issued in connection with a legal dispute with a supplier with further details
set out in note 32(b) to the Historical Financial Information. The order restricts the Group from
transferring or disposing of the building pending resolution of the dispute.
APPENDIX I ACCOUNTANTS’ REPORT
– I-82 –


--- page 604 ---
The management has assessed that there is impairment indication for the non-financial assets
of the Group at the end of each reporting period during the Track Record Period resulting from the
unfavourable operating performance of the Group during the Track Record Period. Therefore, the
management has performed impairment assessment for the non-financial assets, which mainly
consist of PPE (Note 16), ROU assets (Note 17), intangible assets (Note 18) and prepayments for
acquisition of PPE (Note 24) of the Group.
For the purposes of impairment testing, the Group estimates the recoverable amount of a
cash-generating unit (“ CGU”) of the Group to which the asset belongs when it is not possible to
estimate the recoverable amount individually. The CGU represents the Group’s single operation
which is the smallest identifiable group of assets that generates cash inflows that are largely
independent of the cash inflows from other assets.
The recoverable amounts of the CGU were determined based on the value in use calculation.
The value in use was estimated with reference to the cash flow projections based on the most
recent financial budgets approved by the directors covering a period of the remaining useful lives
of the CGU (the “ Projection Period ”), which represented the management’s best estimate on the
ongoing operation of the CGU where the CGU will continue to operate in the foreseeable future
and are consistent with past actual outcomes, with pre-tax discount rates of 17%, 16%, 15% and
14% as at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025
respectively. Cash flows beyond the detailed forecast period are extrapolated using an estimated
weighted average growth rate of 3% consistent for all these reporting dates, which does not exceed
the long-term average growth rate for the market in which the subsidiaries operates. The total
recoverable amounts of the CGU are RMB7,323.3 million, RMB9,796.1 million, RMB13,425.7
million and RMB15,844.7 million as at 31 December 2022, 31 December 2023, 31 December 2024
and 30 June 2025 respectively.
Based on the result of the assessment, the recoverable amounts of non-financial assets exceed
the carrying amounts of non-financial assets at the end of each reporting period during the Track
Record Period. No impairment loss has been provided for the non-financial assets of the Group for
the Track Record Period.
APPENDIX I ACCOUNTANTS’ REPORT
– I-83 –


--- page 605 ---
The Company
Vehicles
Machinery and
equipment
Office
equipment,
computers and
others
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2022 ............. 10,672 439 10,572 29,232 50,915
Additions .................... 4,399 — 2,555 513 7,467
Disposal ..................... (84) — (148) — (232)
As at 31 December 2022 and
1 January 2023 ............... 14,987 439 12,979 29,745 58,150
Additions .................... 3,200 — 931 — 4,131
Additions through intercompany transfer . ——9 7—9 7
Disposal through intercompany transfer .. — — (52) — (52)
Write off upon termination of leasehold
building ................... — — — (29,745) (29,745)
Disposal ..................... (584) — — — (584)
As at 31 December 2023 and
1 January 2024 ............... 17,603 439 13,955 — 31,997
Additions ................... 113 — 867 — 980
Additions through intercompany transfer . ——4 8—4 8
Disposal through intercompany transfer .. (474) — (8) — (482)
Disposal ..................... (71) — (44) — (115)
As at 31 December 2024 and
1 January 2025 ............... 17,171 439 14,818 — 32,428
Additions ................... — 23 150 — 173
Additions through intercompany transfer . 738 — 236 — 974
Disposal ..................... — — (22) — (22)
As at 30 June 2025 ............. 17,909 462 15,182 — 33,553
APPENDIX I ACCOUNTANTS’ REPORT
– I-84 –


--- page 606 ---
Vehicles
Machinery and
equipment
Office
equipment,
computers and
others
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Depreciation and impairment
As at 1 January 2022 ............. 4,428 252 4,933 20,116 29,729
Provided for the year ............. 2,873 85 2,262 6,335 11,555
Disposal ..................... (62) — (5) — (67)
As at 31 December 2022 and
1 January 2023 ............... 7,239 337 7,190 26,451 41,217
Provided for the year ............. 3,286 72 2,188 3,295 8,841
Transfer out .................. — — (40) — (40)
Disposal ..................... (568) — — — (568)
Write off upon termination of leasehold
building ................... — — — (29,746) (29,746)
As at 31 December 2023 and
1 January 2024 ............... 9,957 409 9,338 — 19,704
Provided for the year ............. 3,002 17 1,592 — 4,611
Transfer out .................. (230) — (4) — (234)
Disposal .................... (69) — (43) — (112)
As at 31 December 2024 and
1 January 2025 ............... 12,660 426 10,883 — 23,969
Provided for the period ........... 1,727 1 799 — 2,527
Disposal .................... — — (22) — (22)
As at 30 June 2025 .............. 14,387 427 11,660 — 26,474
Net book value
As at 31 December 2022 .......... 7,748 102 5,789 3,294 16,933
As at 31 December 2023 .......... 7,646 30 4,617 — 12,293
As at 31 December 2024 .......... 4,511 13 3,935 — 8,459
As at 30 June 2025 ............. 3,522 35 3,522 — 7,079
APPENDIX I ACCOUNTANTS’ REPORT
– I-85 –


--- page 607 ---
17 LEASES
(a) Amounts recognized in the consolidated statements of financial positions
The consolidated statements of financial positions show the following amounts relating to
leases:
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Right-of-use assets
— Leasehold land ................ 38,954 38,118 37,282 36,864
— Leasehold buildings ............ 5,543 4,565 3,811 6,156
44,497 42,683 41,093 43,020
Lease liabilities
— Current ...................... 4,566 2,980 3,661 5,937
— Non-current .................. 1,875 608 332 180
6,441 3,588 3,993 6,117
Additions to leased buildings during the years ended 31 December 2022, 31 December 2023,
31 December 2024 and six months ended 30 June 2025 were approximately RMB3.2 million,
RMB5.9 million, RMB6.5 million and RMB5.6 million, respectively.
For the impairment assessment of right-of-use assets, please refer to Note 16 for more details.
APPENDIX I ACCOUNTANTS’ REPORT
– I-86 –


--- page 608 ---
(b) Amounts recognised in the consolidated statements of profit or loss and other
comprehensive income
The consolidated statements of profit or loss and other comprehensive income show the
following amounts relating to leases:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Depreciation of right-of-use assets .... 6,743 7,486 7,612 4,016 3,708
Interest expense (Note 12) .......... 350 208 165 68 32
Expense relating to short-term leases
(Note 7) ................... 287 1,463 346 172 364
Gain on lease termination (Note 10) .... —9 08 0 7—
The total cash outflows for leases during the years ended 31 December 2022, 31 December
2023, 31 December 2024 and six months ended 30 June 2024 and 30 June 2025 were
approximately RMB7.50 million, RMB10.09 million, RMB6.03 million, RMB2.43 million
(unaudited) and RMB3.34 million, respectively.
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Right-of-use assets
Leasehold buildings ............. 2,288 2,921 2,782 5,590
Lease liabilities
Current ...................... 2,955 1,641 2,811 5,590
Non-current ................... ————
2,955 1,641 2,811 5,590
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Depreciation of right-of-use assets ..... 4,576 5,209 5,702 2,921 2,782
Interest expense ................ 243 96 90 16 15
Expense relating to short-term leases ... 87 283 207 74 330
APPENDIX I ACCOUNTANTS’ REPORT
– I-87 –


--- page 609 ---
(c) The Group’s leasing activities and how these are accounted for
The Group leases various buildings and a piece of leasehold land for operation. Rental
contracts of the leasehold buildings are typically made according to contracts by contracts ranging
from one year to five years. Lease terms are negotiated on an individual basis and contain a wide
range of different terms and conditions. The lease agreements do not impose any covenants other
than the security interests in the leased assets that are held by the lessors. Leased buildings may
not be used as security for borrowing purposes.
18 INTANGIBLE ASSETS
Acquired software
RMB’000
The Group/The Company
Cost
As at 1 January 2022 ............................................. 4,300
Additions ...................................................... 2,329
As at 31 December 2022 and 1 January 2023 ........................... 6,629
Additions ...................................................... 1,147
As at 31 December 2023 and 1 January 2024 ........................... 7,776
Additions ...................................................... 923
As at 31 December 2024 and 1 January 2025 ........................... 8,699
Additions ...................................................... 964
As at 30 June 2025 ............................................... 9,663
Amortisation and impairment
As at 1 January 2022 ............................................. 3,001
Provided for the year ............................................. 1,053
As at 31 December 2022 and 1 January 2023 ........................... 4,054
Provided for the year ............................................. 1,430
As at 31 December 2023 and 1 January 2024 ........................... 5,484
Provided for the year ............................................. 1,459
As at 31 December 2024 and 1 January 2025 ........................... 6,943
Provided for the period ............................................ 778
As at 30 June 2025 ............................................... 7,721
Net book value
As at 31 December 2022 ........................................... 2,575
As at 31 December 2023 ........................................... 2,292
As at 31 December 2024 .......................................... 1,756
As at 30 June 2025 ............................................... 1,942
APPENDIX I ACCOUNTANTS’ REPORT
– I-88 –


--- page 610 ---
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the
intangible assets of the Group are mainly software which included research and development
testing software and office software.
For the impairment assessment of intangible assets, please refer to Note 16 for more details.
19 DEFERRED TAX ASSETS
The following is a summary of the deferred tax balances of the Group for financial reporting
purposes:
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Deferred tax assets ............... 117,741 152,912 181,264 206,782
Set-off with deferred tax liabilities
pursuant to set-off provisions ...... (489) (594) (611) (1,359)
117,252 152,318 180,653 205,423
Deferred tax liabilities ............. (489) (594) (611) (1,359)
Set-off with deferred tax assets
pursuant to set-off provisions ...... 489 594 611 1,359
————
117,252 152,318 180,653 205,423
APPENDIX I ACCOUNTANTS’ REPORT
– I-89 –


--- page 611 ---
The followings are the major deferred tax assets and liabilities recognised and movements thereon before offsetting during the Track
Record Period:
The Group
Lease
liability
Unrealized
intercompany
profits
Impairment
allowance
Provision for
warranties Tax losses
Deferred
income ROU asset
Fair value
adjustment
Significant
financing
components
of trade
receivables
Significant
financing
components
of trade
payables Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2022 ................. 1,477 310 734 607 75,024 354 (1,196) 65 — — 77,375
Credit/(charged) to profit or loss .......... (948) (12) 1,554 (316) 39,311 (354) 727 (85) — — 39,877
As at 31 December 2022 and 1 January 2023 .... 529 298 2,288 291 114,335 — (469) (20) — — 117,252
Credit/(charged) to profit or loss .......... (283) — 982 449 34,023 — (36) (69) — — 35,066
As at 31 December 2023 and 1 January 2024 .... 246 298 3,270 740 148,358 — (505) (89) — — 152,318
Credit/(charged) to profit or loss .......... 273 (291) 1,305 2,761 24,304 — (28) 11 — — 28,335
As at 31 December 2024 and 1 January 2025 .... 519 7 4,575 3,501 172,662 — (533) (78) — — 180,653
Credit/(charged) to profit or loss .......... 399 — 12,208 2,622 9,867 — (385) (53) 422 (310) 24,770
As at 30 June 2025 .................. 918 7 16,783 6,123 182,529 — (918) (131) 422 (310) 205,423
APPENDIX I ACCOUNTANTS’ REPORT
– I-90 –


--- page 612 ---
The following is a summary of the deferred tax balances of the Company for financial
reporting purposes:
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Deferred tax assets ............... 113,352 147,579 175,282 200,403
Set-off with deferred tax liabilities
pursuant to set-off provisions ...... (364) (528) (496) (1,280)
112,988 147,051 174,786 199,123
Deferred tax liabilities ............. (364) (528) (496) (1,280)
Set-off with deferred tax assets
pursuant to set-off provisions ...... 364 528 496 1,280
————
112,988 147,051 174,786 199,123
APPENDIX I ACCOUNTANTS’ REPORT
– I-91 –


--- page 613 ---
The followings are the major deferred tax assets and liabilities recognised and movements thereon before offsetting during the Track
Record Period:
The Company
Lease
liability
Impairment
allowance
Provision for
warranties Tax losses
Deferred
income ROU asset
Fair value
adjustment
Significant
financing
components
of trade
receivables
Significant
financing
components
of trade
payables Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2022 ........................ 1,299 722 592 72,992 354 (1,030) 65 — — 74,994
Credit/(charged) to profit or loss .................. (855) 1,479 (315) 37,438 (354) 686 (85) — — 37,994
As at 31 December 2022 and
1 January 2023 .......................... 444 2,201 277 110,430 — (344) (20) — — 112,988
Credit/(charged) to profit or loss .................. (197) 913 439 33,072 — (95) (69) — — 34,063
As at 31 December 2023 and
1 January 2024 .......................... 247 3,114 716 143,502 — (439) (89) — — 147,051
Credit/(charged) to profit or loss .................. 175 1,354 2,741 23,433 — 21 11 — — 27,735
As at 31 December 2024 and 1 January 2025 ........... 422 4,468 3,457 166,935 — (418) (78) — — 174,786
Credit/(charged) to profit or loss .................. 417 12,223 2,617 9,442 — (421) (53) 422 (310) 24,337
As at 30 June 2025 ......................... 839 16,691 6,074 176,377 — (839) (131) 422 (310) 199,123
APPENDIX I ACCOUNTANTS’ REPORT
– I-92 –


--- page 614 ---
20 INVENTORIES
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the
inventories held by the Group for sales are shown by category as below:
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Contract costs in progress (a) ....... 88,364 151,691 55,196 124,402
Raw material .................... 35,146 31,526 41,027 45,775
Finished goods .................. 6,228 6,885 7,936 7,982
Consigned-processing-material ...... 966 3,104 58 53
Less: provision .................. (7,239) (18,979) (7,673) (7,691)
123,465 174,227 96,544 170,521
(a) Contract costs in progress mainly include the direct materials, employee costs and manufacturing costs to be
consumed in the process of service rendering related to the sales contracts.
During the years ended 31 December 2022, 31 December 2023, 31 December 2024 and six
months ended 30 June 2024 and 30 June 2025, inventories recognized as cost of sales amounted to
RMB36.08 million, RMB101.42 million, RMB296.31 million, RMB203.20 million (unaudited) and
RMB319.42 million, respectively, and including provision for inventories recognized as cost of
sales amounted to RMB5.24 million, RMB11.83 million, RMB3.67 million, RMB0.75 million
(unaudited) and RMB0.99 million, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-93 –


--- page 615 ---
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Contract costs in progress .......... 88,270 137,161 38,313 108,298
Raw material .................... 34,002 29,345 40,330 45,729
Finished goods .................. 6,188 5,958 7,747 7,825
Consigned-processing-material ...... 966 3,104 58 53
Less: provision .................. (7,205) (17,399) (7,423) (7,650)
122,221 158,169 79,025 154,255
Provision for inventories was recognized for the amount by which the carrying amount of the
inventories exceeds its net realizable value and was recorded in “cost of sales” in the consolidated
statements of profit or loss and other comprehensive income. Provision for inventories movements
for the years ended 31 December 2022 and 31 December 2023, 31 December 2024 and the six
months ended 30 June 2024 and 30 June 2025 are as below:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
At the beginning of the year/period .... 2,004 7,239 18,979 18,979 7,673
Provision .................... 5,235 11,825 3,673 753 985
Written off ................... — (85) (14,979) (7,919) (967)
At the end of the year/period ........ 7,239 18,979 7,673 11,813 7,691
APPENDIX I ACCOUNTANTS’ REPORT
– I-94 –


--- page 616 ---
21 FINANCIAL INSTRUMENTS BY CATEGORY
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
Financial assets at FVTPL (Note 22) .. 30,655 2,116 12,546 3,398
Financial assets at FVTOCI (Note 23) . 395 9,799 290 18,543
Financial assets at amortized cost:
— Trade and notes receivables
(Note 26) .................. 30,772 58,680 137,360 457,826
— Other receivables (excluded
prepayments, deferred listing
expenses and V AT recoverable)
(Note 24) .................. 14,266 48,801 48,729 38,053
— Cash and cash equivalents
(Note 27) .................. 381,678 234,663 306,402 186,225
— Restricted bank deposits
(Note 27) .................. 27,806 27,819 10,481 22,105
— Term deposits (Note 27) ......... 190,101 152,588 5,328 5,402
675,673 534,466 521,136 731,552
Financial liabilities
Financial liabilities at amortized cost:
— Trade and notes payables
(Note 30) .................. 41,530 70,689 63,299 397,959
— Other payables and accruals
(excluding repayable government
grants, other tax payables,
payroll and welfare payables,
and accruals) (Note 31) ........ 41,185 78,452 68,327 115,431
— Borrowings (Note 28) ........... 146,406 127,534 237,742 325,684
— Lease liabilities (Note 17) ....... 6,441 3,588 3,993 6,117
— Financial instruments with
preferred rights at amortized cost
(Note 29) .................. 1,625,922 1,766,025 1,894,618 1,962,541
1,861,484 2,046,288 2,267,979 2,807,732
APPENDIX I ACCOUNTANTS’ REPORT
– I-95 –


--- page 617 ---
22 FINANCIAL ASSETS AT FAIR V ALUE THROUGH PROFIT OR LOSS
The Group classifies the following financial assets at FVTPL:
 debt investments that do not qualify for measurement at either amortized cost or at
FVTOCI;
 equity investments that are held for trading; and
 equity investments for which the entity has not elected to recognize fair value gains or
losses through OCI.
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
The Group and the Company
Financial assets
Non-current assets
Financial assets at FVTPL
— Unlisted equity investments (a) ... 525 1,116 929 1,022
— Unlisted debt investment (b)...... — 1,000 1,612 2,376
525 2,116 2,541 3,398
Current assets
Financial assets at FVTPL
— Structured deposits (c) .......... 30,130 — 10,005 —
30,655 2,116 12,546 3,398
(a) In September 2020, the Company entered into an agreement to invest in 5% equity interests of a limited company,
ʮ̡ (Xinjiang Xiangjiang Youpin Agricultural Technology Co., Ltd.), with a total
investment of RMB500,000. The investment of RMB25,000 was paid in September 2020. As a shareholder, the
Group has no significant influence based on the fact that no representation on the board of directors or other special
rights are over the limited company. Hence, the investment is accounted for as financial assets at FVTPL with
changes in the fair value recorded in the consolidated statements of profit or loss and other comprehensive income.
In September 2022, the Company entered into an agreement to invest in 3.7037% equity interests of a limited
company,ʮ̡ (Shandong Xinyuan High Tech Automobile Technology Co., Ltd.), with
a total investment of RMB500,000. The consideration was paid fully in September 2022. As a shareholder, the
Group has no significant influence based on the fact that no representation on the board of directors or other special
rights are over the limited company. Hence, the investment is accounted for as financial assets at FVTPL with
changes in the fair value recorded in the consolidated statements of profit or loss and other comprehensive income.
APPENDIX I ACCOUNTANTS’ REPORT
– I-96 –


--- page 618 ---
The unlisted equity investments are classified as non-current as the management expects to realise these financial
assets after twelve months after each reporting period during the Track Record Period.
(b) In March 2023, the Company entered into an agreement to invest in 9.7% interests ofႂ௴௴ุҳ༟Υྫ
Άุ(Υྫ) (Chengdu CiDi Rongchuang Venture Capital Partnership (Limited Partnership)) with a total
investment of RMB9,800,000. The limited partnership funds will focus on the investment portfolio in the industry
of autonomous driving etc. The Company paid the investment of RMB1,000,000, RMB500,000 and RMB500,000 in
November 2023, December 2024 and January 2025, respectively.
The unlisted debt investment is classified as non-current as the management expects to realise these financial assets
after twelve months after each reporting period during the Track Record Period.
(c) Structured deposits measured at FVTPL represents the subscription of the wealth management products of several
financial institutions in PRC which are unsecured and with variable interest rates. The deposits can be purchased or
disposed at any date during the open days. The Group measures the investments at fair value using the quoted
subscription or redemption prices published by the bank.
23 FINANCIAL ASSETS AT FAIR V ALUE THROUGH OTHER COMPREHENSIVE
INCOME
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
The Group
Financial assets at FVTOCI
— Receivables financing ........... 395 9,799 290 18,543
Receivables financing measured at FVTOCI represents bills of acceptance issued by banks.
The Group’s business model of financial assets at FVTOCI is achieved both by collecting
contractual cash flows and selling of these assets. As at 31 December 2022, 31 December 2023, 31
December 2024 and 30 June 2025, all receivables financing of the Group were due within one
year.
During the Track Record Period, the Group has transferred substantially all the risks and
rewards of ownership of certain bills receivable endorsed to its suppliers, even if the suppliers
have the rights of recourse. The relevant assets and liabilities were derecognized and no longer
included in the Historical Financial Information. In the opinion of the directors, the Group has
limited exposure in respect of the settlement obligation of these bills receivable under the relevant
PRC rules and regulations should the issuing banks fail to settle the bills on maturity date. The
Group considered the issuing banks of these bills are of good credit quality and non-settlement of
these bills by the issuing banks on maturity is not probable.
APPENDIX I ACCOUNTANTS’ REPORT
– I-97 –


--- page 619 ---
The Group’s maximum exposure that may result from the default of these endorsed bills
receivable at the end of each reporting period are as follows:
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
The Group
Endorsed bills for settlement of
payables to suppliers ............ 3,377 9,319 27,655 65,427
Outstanding endorsed bills receivable
with recourse .................. 3,377 9,319 27,655 65,427
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
The Company
Financial assets at FVTOCI
— Receivables financing ........... — 7,849 290 6,393
The Company’s maximum exposure that may result from the default of these endorsed bills
receivable at the end of each reporting period are as follows:
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
The Company
Endorsed bills for settlement of
payables to suppliers ............ 3,377 9,319 27,024 55,324
Outstanding endorsed bills receivable
with recourse .................. 3,377 9,319 27,024 55,324
APPENDIX I ACCOUNTANTS’ REPORT
– I-98 –


--- page 620 ---
24 PREPAYMENTS AND OTHER RECEIV ABLES
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current
Prepayments for acquisition of
PPE (e) ...................... 3,881 10,835 10,542 11,230
Loan to a third party (d) ........... — 6 , 8 0 0——
3,881 17,635 10,542 11,230
Less: loss allowance .............. — (149) — —
3,881 17,486 10,542 11,230
Current
Prepayments made to the third-party
suppliers ..................... 9,321 16,145 35,402 86,928
Prepayment made to the ultimate
holding company of the Company .. 3,660 660 — —
Prepayment made to the related-party
suppliers ..................... ——— 2 3 5
Prepayments for listing expenses ..... — — 2,689 1,223
Deferred listing expenses .......... — — 2,049 3,637
Amount due from the employee (a) ... 179 43 71 1,461
Amount due from the third parties ... 77 29 25 25
Payments made on behalf of
customers (b) .................. 8,696 27,849 14,175 15,136
Loans to the employees (c) ......... 822 1,966 2,030 2,059
Loans to a third party (d) .......... — 3,075 12,875 13,110
V AT recoverable ................. 28,835 31,471 29,051 30,648
Deposits ....................... 4,767 9,765 27,338 26,843
56,357 91,003 125,705 181,305
Less: provision for impairment ...... (275) (577) (7,785) (20,581)
56,082 90,426 117,920 160,724
(a) As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, amount due from the employee
were mainly petty cash. The petty cash was non-trade in nature, unsecured, interest free and repayable on demand.
APPENDIX I ACCOUNTANTS’ REPORT
– I-99 –


--- page 621 ---
(b) Payments made on behalf of customers represent receivables on the payments made on behalf of the customers
arising from the transaction of ancillary services relating to V2X for the Group acting as an agent. The receivables
are trade in nature, unsecured, interest-free and repayable on demand. The Group assessed whether revenue should
be reporting on a gross or net basis for each sales transaction with basis as set out in Note 4(b). For certain sales
transactions where the Group acts as agent during the Track Record Period, revenue is recorded on a net basis and
the receivables arising from these transactions were recorded in other receivables. The management expects to
realize these financial assets within twelve months after each reporting period during the Track Record Period.
(c) As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, loans to the employees was
non-trade in nature, unsecured, interest bearing ranging from 3% to 3.85% per annum and repayable on demand.
(d) As at 31 December 2023, 31 December 2024 and 30 June 2025, loans to a third party represented the loans to the
end customer for its business operation. The loans were non-trade in nature, unsecured, guaranteed by the project
leader of customer, the interest-bearing from 3.5% to 5% per annum. According to the loan contracts, the principal
amounts of RMB2.6 million, RMB3 million, RMB5 million and RMB1.8 million will be repayable in September
2024, December 2024, June 2025 and December 2025 respectively with the interests. In August 2024, the Company
and the borrower entered into a supplementary agreement to extend the repayment dates of the loans, the principal
amounts of RMB12.4 million would be repayable in December 2025 with the interests. The result of the
modification of the financial assets is considered immaterial. The ECL assessment of the loans to the end customer
is set out in note 3.1(b)(iii) to the Historical Financial Information.
(e) For the impairment assessment of prepayments for acquisition of PPE, please refer to Note 16 for more details.
APPENDIX I ACCOUNTANTS’ REPORT
– I-100 –


--- page 622 ---
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current
Prepayments for acquisition of PPE .. 1,710 23 — 500
Loan to a third party .............. — 6 , 8 0 0——
Amount due from the subsidiaries (a) . 232,530 166,000 190,000 190,000
234,240 172,823 190,000 190,500
Less: loss allowance .............. — (149) — —
234,240 172,674 190,000 190,500
Current
Prepayments made to the third party
suppliers ..................... 6,490 15,702 35,091 85,061
Prepayment made to the ultimate
holding company of the Company .. 3,660 660 — —
Prepayments for listing expenses ..... — — 2,689 1,223
Deferred listing expenses .......... — — 2,049 3,637
Amount due from the employee ..... 141 43 71 1,301
Amount due from the subsidiaries (a) . 61,017 137,241 188,352 192,281
Amount due from the third parties ... 28 29 25 25
Payments made on behalf of
customers ..................... 631 121 1,203 1,213
Loans to the employees ............ 822 1,966 2,030 2,059
Loans to a third party ............. — 3,075 12,875 13,110
V AT recoverable ................. 2,718 1,812 460 2,355
Deposits ....................... 4,111 3,726 21,495 21,361
79,618 164,375 266,340 323,626
Less: provision for impairment ...... (125) (144) (7,488) (20,252)
79,493 164,231 258,852 303,374
(a) Amount due from the subsidiaries was unsecured, interest free and repayable on demand or range from two to six
years.
APPENDIX I ACCOUNTANTS’ REPORT
– I-101 –


--- page 623 ---
25 CONTRACT ASSETS
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Carrying amount ................. 3,829 10,681 13,261 22,501
Impairment ..................... (942) (847) (1,010) (2,215)
2,887 9,834 12,251 20,286
Contract assets are generally the final payments of revenue contracts which are due at the end
of the quality assurance period (1−3 years). Contract assets are recorded as the Group has no right
on these amounts of consideration when the revenue is recognised.
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Carrying amount ................. 3,828 9,214 12,332 21,238
Impairment ..................... (941) (810) (888) (2,030)
2,887 8,404 11,444 19,208
APPENDIX I ACCOUNTANTS’ REPORT
– I-102 –


--- page 624 ---
26 TRADE AND NOTES RECEIV ABLES
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current
Trade receivables ................ — — — 41,677
Less: provision for impairment
(Note 3.1(b)) ............. — — — (1,797)
— — — 39,880
Current
Trade receivables ................ 34,464 52,880 148,831 402,742
Less: provision for impairment
(Note 3.1(b)) ............. (6,727) (2,562) (18,079) (41,102)
27,737 50,318 130,752 361,640
Notes receivables ................ 3,114 8,475 6,754 57,724
Less: provision for impairment
(Note 3.1(b)) ............. (79) (113) (146) (1,418)
3,035 8,362 6,608 56,306
30,772 58,680 137,360 417,946
(a) As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, notes receivables were mainly
bank acceptance notes aged less than one year.
APPENDIX I ACCOUNTANTS’ REPORT
– I-103 –


--- page 625 ---
The Group usually grants a credit period of 0 days to 180 days to its customers, and
extending to a credit period of 18 months to 24 months for major customers. As at 31 December
2022, 31 December 2023, 31 December 2024 and 30 June 2025, the aging analysis of trade
receivables based on recognition date of gross trade receivables are as follows:
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Up to 3 months .................. 29,863 34,825 66,076 321,650
3 to 6 months ................... 6 2,014 18,726 2,833
6 to 9 months ................... 431 6,530 28,271 37,850
9 to 12 months .................. 82 1,632 1,424 17,334
over 12 months .................. 4,082 7,879 34,334 64,752
34,464 52,880 148,831 444,419
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current
Trade receivables — — — 35,880
Less: provision for impairment
(Note 3.1(b)) ............. — — — (1,517)
— — — 34,363
Current
Trade receivables
— third parties .................. 32,198 39,302 107,418 345,490
— subsidiaries .................. 3,109 16,153 48,200 83,052
35,307 55,455 155,618 428,542
Less: provision for impairment ...... (6,325) (2,166) (13,845) (34,359)
28,982 53,289 141,773 394,183
Notes receivables
— third parties .................. 3,114 7,475 6,555 56,724
— subsidiaries .................. — 1,000 200 1,000
3,114 8,475 6,755 57,724
Less: provision for impairment ...... (79) (98) (142) (1,400)
3,035 8,377 6,613 56,324
32,017 61,666 148,386 450,507
APPENDIX I ACCOUNTANTS’ REPORT
– I-104 –


--- page 626 ---
The Company usually grants a credit period of 0 days to 180 days to its normal customers,
and extending to a credit period of 18 months to 24 months for major customers. As at 31
December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the aging analysis of
trade receivables based on recognition date of gross trade receivables are as follows:
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Up to 3 months .................. 30,747 43,974 84,623 366,643
3 to 6 months ................... 6 145 16,548 96
6 to 9 months ................... 431 2,640 28,138 27,302
9 to 12 months .................. 82 1,239 1,077 16,472
over 12 months .................. 4,041 7,457 25,232 53,909
35,307 55,455 155,618 464,422
27 CASH AND CASH EQUIV ALENTS/TERM DEPOSITS/RESTRICTED BANK
DEPOSITS
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Cash and cash equivalents ........ 381,678 234,663 306,402 186,225
Term deposits
— Short-term bank deposits (a) ..... — 147,411 5,328 5,402
— Long-term bank deposits (a)...... 190,101 5,177 — —
190,101 152,588 5,328 5,402
Restricted bank deposits (b) ....... 27,806 27,819 10,481 22,105
(a) Term deposits were deposits with initial terms of over three months which neither past due nor impaired. The
directors of the Company considered that the carrying amount of the term deposits with initial terms of over three
months approximated to their fair value as at 31 December 2022, 31 December 2023, 31 December 2024 and 30
June 2025. Various term deposits were secured for borrowings, please refer to Note 28 for more details.
APPENDIX I ACCOUNTANTS’ REPORT
– I-105 –


--- page 627 ---
Short-term bank deposits are bank deposits with maturities over three months but within twelve months and
redeemable on maturity. Long-term bank deposits are bank deposits with maturities over twelve months and
redeemable on maturity. The effective interest rates for the short-term bank deposits were 2.75% to 3.55% per
annum, 3% per annum and 3% per annum for the years ended 31 December 2023, 31 December 2024 and six
months ended 30 June 2025, respectively.
(b) As at 31 December 2022, 31 December 2023, 31 December 2024 and June 2025, the restricted deposits were
mainly denominated in RMB and held in separate designed bank accounts as security deposits for issuance of bank
acceptance bills and bank borrowings and fulfillment of contracts related to autonomous driving.
The restricted deposits for issuance of bank acceptance bills were used to secure the bank acceptance bills issued
by the Company, and the restricted period was less than one year.
The restricted deposits for bank borrowings were used to secure the borrowings, and it has been released in 2023
since the borrowings were repaid.
The restricted deposits for fulfillment of contracts were deposited in September 2024 and released in March 2025.
As at 31 December 2024, a bank account with the amount of RMB0.68 million of the Group was frozen by the
court in the PRC due to a legal case. The bank account has been released after the legal case terminated in April
2025.
As at 30 June 2025, three bank accounts with total carrying amounts of RMB8.8 million of the Group were frozen
and will be released when the legal case resolves. Further details are set out in note 32(b).
The restricted deposits carry interests at 0.25%, 0.2%−1.3%, 0.1%−0.85% and 0.05 %−1.0% per annum as at 31
December 2022, 31 December 2023, 31 December 2024 and 30 June 2025.
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Cash and cash equivalents ........ 269,589 145,688 244,392 134,892
Term deposits
— Short-term bank deposits ........ — 147,411 5,328 5,402
— Long-term bank deposits ........ 190,101 5,177 — —
190,101 152,588 5,328 5,402
Restricted bank deposits .......... 27,806 27,819 9,796 13,312
APPENDIX I ACCOUNTANTS’ REPORT
– I-106 –


--- page 628 ---
28 BORROWINGS
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Borrowings included in current
liabilities
Secured and unguaranteed bank
borrowings (a) ................. 34,512 90,528 39,822 47,689
Unsecured and unguaranteed bank
borrowings (b) ................. 10,013 23,225 114,020 181,171
Secured and guaranteed bank
borrowings (c) ................. 81 10,081 — —
Other borrowings (d) .............. — — — 2,024
44,606 123,834 153,842 230,884
Borrowings included in non-current
liabilities
Secured and unguaranteed bank
borrowings (a) ................. 91,800 3,700 83,900 75,800
Unsecured and unguaranteed bank
borrowings (b) ................. — — — 19,000
Secured and guaranteed bank
borrowings (c) ................. 10,000 — — —
101,800 3,700 83,900 94,800
Total borrowings ................ 146,406 127,534 237,742 325,684
APPENDIX I ACCOUNTANTS’ REPORT
– I-107 –


--- page 629 ---
The following table sets out the maturity profile of the total bank borrowings as at each
reporting period end:
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
On demand or within one year ...... 44,606 123,834 153,842 228,860
More than one year, but not exceeding
two years ..................... 100,200 3,700 36,000 72,100
More than two years, but not
exceeding five years ............ 1,600 — 47,900 22,700
Total .......................... 146,406 127,534 237,742 323,660
The following table sets out the maturity profile of other borrowings as at each reporting
period end:
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
On demand or within one year ...... — — — 2,024
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Borrowings included in current
liabilities
Secured and unguaranteed bank
borrowings (a) ................. 29,381 405 39,822 47,689
Unsecured and unguaranteed bank
borrowings (b) ................. 10,013 23,225 114,020 176,167
Secured and guaranteed bank
borrowings (c) ................. 81 10,081 — —
Other borrowings (d) .............. — — — 2,024
39,475 33,711 153,842 225,880
APPENDIX I ACCOUNTANTS’ REPORT
– I-108 –


--- page 630 ---
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Borrowings included in non-current
liabilities
Secured and unguaranteed bank
borrowings (a) ................. 1,800 3,700 83,900 75,800
Unsecured and unguaranteed bank
borrowings (b) ................. — — — 19,000
Secured and guaranteed bank
borrowings (c) ................. 10,000 — — —
11,800 3,700 83,900 94,800
Total borrowings ................ 51,275 37,411 237,742 320,680
The following table sets out the maturity profile of the total bank borrowings as at each
reporting period end:
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
On demand or within one year ...... 39,475 33,711 153,842 223,856
More than one year, but not exceeding
two years ..................... 10,200 3,700 36,000 72,100
More than two years, but not
exceeding five years ............ 1,600 — 47,900 22,700
Total .......................... 51,275 37,411 237,742 318,656
The following table sets out the maturity profile of other borrowings as at each reporting
period end:
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
On demand or within one year ...... — — — 2,024
APPENDIX I ACCOUNTANTS’ REPORT
– I-109 –


--- page 631 ---
(a) Secured and unguaranteed bank borrowings
(i) In March 2022, the Company entered into a loan facility agreement with China Minsheng
Bank Co., Ltd. Xiangtan Branch which provided the Company a credit limit in an aggregate
principal amount of RMB4 million with an interest rate of 4.20% per annum which shall be
repaid by March 2023. Borrowings under the loan facility agreement were collateralized by
17 invention patents of the Company with the amount of RMB8.11 million under the
appraisal of the valuation professional party during the terms of borrowings. In March 2023,
the borrowings and related interest were fully repaid and the collateralization was released
accordingly.
(ii) In June 2022, the Company entered into a loan facility agreement with Shanghai Pudong
Development Bank Co., Ltd. Changsha Branch which provided the Company loans
aggregated principal amount of RMB1.03 million and RMB2.64 million with an interest rate
of 4.00% per annum which shall be repaid by June 2023. Borrowings under the loan facility
agreement were collateralized by deposits of the Company with the carrying amount of
RMB4 million during the terms of borrowings. In June 2023, the borrowings and related
interest were fully repaid and the collateralization was released accordingly.
(iii) In June 2022, the Company entered into a loan facility agreement with Shanghai Pudong
Development Bank Co., Ltd. Changsha Branch which provided the Company loans
aggregated principal amount of RMB20.46 million with an interest rate of 4.00% per annum
which shall be repaid by June 2023. Borrowings under the loan facility agreement were
collateralized by deposits of the Company with the carrying amount of RMB22 million
during the terms of borrowings. In June 2023, the borrowings and related interest were fully
repaid and the collateralization was released accordingly.
(iv) In September 2022, the Company entered into a loan facility agreement with Shanghai
Pudong Development Bank Co., Ltd. Changsha Branch which provided the Company loans
aggregated principal amount of RMB1.01 million with an interest rate of 4.00% per annum
which shall be repaid by September 2023. Borrowings under the loan facility agreement were
collateralized by deposits of the Company with the carrying amount of RMB1.1 million
during the terms of borrowings. In March 2023, the borrowings and related interest were
fully repaid and the collateralization was released accordingly.
(v) In November 2022 and in February 2023, the Company entered into the loan facility
agreement with China Construction Bank Corporation Hunan Branch Business Department
which provided the Company loans aggregated principal amount of RMB2 million and
RMB2.5 million respectively with an initial interest rate of 3.95% per annum, which shall be
repaid from June 2023 to October 2025 respectively. Borrowings under the loan facility
APPENDIX I ACCOUNTANTS’ REPORT
– I-110 –


--- page 632 ---
agreement were collateralized by the three-year term deposit of the Company with the
carrying amount of RMB5 million during the terms of borrowings. As at 30 June 2025, the
principal amount of RMB1 million and related interest were repaid and the interest rate was
taken down to 3.40% per annum.
(vi) In June 2022, Changsha CiDi Intelligent Building Co., Ltd, the subsidiary of Company,
entered into a loan facility agreement with Changsha Bank Co., Ltd. Xiangjiang New Area
Branch which provided Changsha CiDi Intelligent Building Co., Ltd loans aggregated
principal amount of RMB95 million with an interest rate of 4.50% per annum, which shall be
repaid by June 2024. Borrowings under the loan facility agreement were collateralized by the
two-year term deposit of Changsha CiDi Intelligent Building Co., Ltd with the carrying
amount of RMB100 million during the terms of borrowings. In June 2024, the borrowings
and related interest were fully repaid and the collateralization was released accordingly.
(vii) In June 2024, the Company entered into a loan facility agreement with Bank of
Communications Co., Ltd. Hunan Branch which provided the Company a loan with the
maximum amount of RMB90 million with an interest rate of 3.20% per annum, which shall
be repaid from December 2024 to June 2027. Borrowings under the loan facility agreement
were collateralized by portion of the buildings of the Group and 3 invention patents of the
Company during the terms of borrowings. During the period ended 30 June 2025, the
borrowings and related interest were repaid according to payment schedule.
(viii) In October 2024 and June 2025, the Company entered into two loan facility agreements with
Bank of Communications Co., Ltd. Hunan Branch which provided the Company loans with
the maximum amount of RMB30 million and RMB27 million with an interest rate of 3.10%
per annum, which shall be repaid from April 2025 to November 2027 and December 2025 to
June 2028. Borrowings under the loan facility agreement were collateralized by portion of the
buildings of the Group and 3 invention patents of the Company during the terms of
borrowings. During the period ended 30 June 2025, the borrowings and related interest were
repaid according to payment schedule.
(b) Unsecured and unguaranteed bank borrowings
(i) In January 2022, the Company entered into a loan facility agreement with Bank of
Communications Co., Ltd. Hunan Branch which provided the Company loans aggregated
principal amount of RMB10 million with a fixed interest at 4.3% per annum. In January
2023, the borrowings and related interest were fully repaid.
(ii) In May 2023 and in October 2023, the Company entered into a one-year loan facility
agreement with Bank of Communications Co., Ltd. Hunan Branch which provided the
company the credit limit in the aggregate principal amount of RMB50 million and RMB5
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 633 ---
million. As at 31 December 2023, the Company drew down borrowings with the amount of
RMB8.2 million under the facility with an interest rate of 4.15% per annum which shall be
repaid by June 2024. In June 2024, the borrowings and related interest were fully repaid. In
February 2024, the Company drew down borrowings with the amount of RMB10 million
under the facility with an interest rate of 3.85% per annum which shall be repaid by February
2025. In February 2025, the borrowings and related interest were fully repaid. And the
Company drew down bank acceptances from July 2023 to October 2023 with the amount of
RMB25.13 million under the facility and the amount paid were fully repaid on 30 June 2024.
In July 2024, the Company drew down borrowings with the amount of RMB8.4 million under
the facility with an interest rate of 3.50% per annum. The borrowings and related interest
were fully repaid in July 2025.
(iii) In December 2023, the Company entered into a one-year loan facility agreement with China
CITIC Bank Co., Ltd. Changsha Branch which provided the Company a credit limit in an
aggregate principal amount of RMB40 million. In December 2023 and January 2024, the
Company drew down borrowings with the amount of RMB5 million and RMB5 million
respectively under the facility with an interest rate of 4.0% per annum which shall be repaid
by December 2024 and January 2025. In December 2024 and January 2025, the borrowings
and related interest were fully repaid.
(iv) In December 2023, the Company entered into a loan facility agreement with Bank of Beijing
Co., Ltd. Changsha Branch which provided the Company a credit limit in an aggregate
principal amount of RMB30 million. As at 20 December 2023, 2 January 2024 and 31
January 2024, the Company drew down borrowings with the amount of RMB5 million,
RMB4 million and RMB1 million respectively under the facility with an interest rate of
3.85% per annum which shall be repaid by 25 December 2024. In December 2024, the
borrowings and related interest were fully repaid. In September 2024 and December 2024, the
Company drew down borrowings with the amount of RMB10 million and RMB10 million
respectively under the facility with an interest rate of 3.75% and 3.5% per annum which shall
be repaid by September 2025 and December 2025. The borrowings of RMB10 million and
related interest were repaid in September 2025.
(v) In December 2023, the Company entered into a one-year loan facility agreement with
Shanghai Pudong Development Bank Co., Ltd. Changsha Branch which provided the
Company a credit limit in an aggregate principal amount of RMB10 million. In December
2023 and January 2024, the Company drew down borrowings with the amount of RMB5
million and RMB5 million respectively under the facility with an interest rate of 3.85% per
annum which shall be repaid by December 2024. In December 2024 and January 2025, the
borrowings and related interest were fully repaid.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 634 ---
(vi) In March 2024, the Company entered into a one-year loan facility agreement with Bank of
China Co., Ltd. Hunan Xiangjiang New District branch which provided the Company a credit
limit in an aggregate principal amount of RMB40 million. In March 2024, the Company drew
down borrowings with the amount of RMB5.5 million under the facility with an interest rate
of 3.45% per annum which shall be repaid by March 2025. In April 2024, the Company drew
down borrowings with the amount of RMB5 million under the facility with an interest rate of
3.45% per annum which shall be repaid by April 2025. In March and April 2025, the
borrowings and related interest were fully repaid. In June 2024, the Company drew down
borrowings with the amount of RMB5 million under the facility with an interest rate of
3.45% per annum which were fully repaid in June 2025.
(vii) In March 2024, the Company entered into a one-year loan facility agreement with China
Everbright Bank Limited Changsha Yingwan branch which provided the Company a credit
limit in an aggregate principal amount of RMB40 million. In March 2024, the Company drew
down borrowings with the amount of RMB10 million under the facility with an interest rate
of 3.85% per annum which shall be repaid by March 2025. In March 2025, the borrowings
and related interest were fully repaid.
(viii) In September 2024, the Company entered into a one-year loan facility agreement with
Industrial and Commercial Bank of China Limited Changsha Yinxun branch which provided
the Company a credit limit in an aggregate principal amount of RMB20 million. In
September 2024, the Company drew down borrowings with the amount of RMB20 million
under the facility with an interest rate of 3.15% per annum which shall be repaid by
September 2025. The borrowings and related interest were fully repaid in September 2025.
(ix) In December 2024, the Company entered into a one-year loan facility agreement with
Shanghai Pudong Development Bank Co., Ltd. Changsha Branch which provided the
Company a credit limit in an aggregate principal amount of RMB30 million. In December
2024, the Company drew down borrowings with the amount of RMB20 million under the
facility with an interest rate of 3.45% per annum which shall be repaid by December 2025.
(x) In February 2025, the Company entered into a loan facility agreement with Bank of
Communications Co., Ltd. Hunan Branch which provided the Company loans aggregated
principal amount of RMB11.6 million with a fixed interest at 3.1% per annum which shall be
repaid by November 2025.
(xi) In February 2025 and June 2025, the Company entered into two loan facility agreements with
Shanghai Pudong Development Bank Co., Ltd. Changsha Branch which provided the
Company loans aggregated principal amount of RMB10 million and RMB10 million with a
fixed interest at 3.45% and 3.35% per annum which shall be repaid by February 2026 and
June 2026, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 635 ---
(xii) In February 2025, the Company entered into a loan facility agreement with Bank of Hunan
Corporation Limited Xiangjiang New Area Branch which provided the Company a credit limit
in an aggregate principal amount of RMB15 million. In February 2025, the Company drew
down borrowings with the amount of RMB15 million under the facility with an interest rate
of 3.5% per annum which shall be repaid by February 2026.
(xiii) In March 2025, the Company entered into a loan facility agreement with Bank of
Communications Co., Ltd. Hunan Branch which provided the Company loans aggregated
principal amount of RMB50 million with a fixed interest at 2.98% per annum which shall be
repaid by March 2026.
(xiv) In March 2025, the Company entered into a loan facility agreement with China Construction
Bank Corporation Hunan Branch which provided the Company loans aggregated principal
amount of RMB20 million with a fixed interest at 2.98% per annum which shall be repaid by
March 2027.
(xv) In April 2025, the Company entered into a loan facility agreement with China Everbright
Bank Limited Changsha Yingwan branch which provided the Company loans aggregated
principal amount of RMB10 million with a fixed interest at 3.3% per annum which shall be
repaid by April 2026.
(xvi) In April 2025, a subsidiary of the Company entered into a loan facility agreement with Bank
of Chengdu Co., Ltd. Shawan Branch which provided loans aggregated principal amount of
RMB5 million with a fixed interest at 2.5% per annum which shall be repaid by April 2026.
(c) Secured and guaranteed bank borrowings
In October 2022, the Company entered into Maximum Loan Guarantee Delegation Contract
with Hanhua Financing Guarantee Co., Ltd. which provided the Company a credit limit in an
aggregate principal amount of RMB10 million with the guarantee rate of 2% per annum. In
October 2022, Industrial Bank Co., Ltd. Changsha Branch was entrusted by an independent third
party, Hunan Xiangjiang Zhongying Investment Management Co., Ltd, to offer the bank borrowing
to the Company with an aggregate principal amount of RMB10 million and a fixed interest at
5.00% per annum. Borrowings under the loan facility agreement were collateralized by 10
invention patents of the Company with the amount of RMB30.58 million under the appraisal of the
valuation professional party during the terms of borrowings. Hanhua Financing Guarantee Co.,
Ltd. was the guarantor. As at 31 December 2023, the Company drew down borrowings with the
amount of RMB10 million under the facility which shall be repaid by November 2024. In October
2024, the borrowings and related interest were fully repaid and the collateralization was released
accordingly.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 636 ---
(d) Other borrowings
Other borrowings as at 30 June 2025 were secured by the trade receivables of the Group with
an interest rate of 5.1%. The borrowings and related interest were fully repaid in July 2025.
29 FINANCIAL INSTRUMENTS WITH PREFERRED RIGHTS AT AMORTIZED COST
The Group/The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Current liabilities
Financial instruments with preferred
rights at amortized cost .......... — — — 1,962,541
Non-current liabilities
Financial instruments with preferred
rights at amortized cost .......... 1,625,922 1,766,025 1,894,618 —
Since the date of incorporation, the Company has completed several rounds of financing by
issuing ordinary shares with preferred rights to investors, namely, Series A Shares, Series A-1
Shares, Series A-2 Shares, Series A-3 Shares, Series B Shares, Series B+ Shares, Series C Shares
and Series C+ Shares.
The movements of financial instruments with preferred rights at amortised cost for the years
ended 31 December 2022 and 31 December 2023, 31 December 2024 and the six months ended 30
June 2024 and 30 June 2025 were as follows:
APPENDIX I ACCOUNTANTS’ REPORT
– I-115 –


--- page 637 ---
Financial
instruments with
preferred rights
at amortized cost
RMB’000
As at 1 January 2022 ............................................ 1,264,220
Effect of financial instruments with preferred rights at amortized cost (a) ..... 270,300
Reclassification of transaction cost payable included in other payable and
accruals ...................................................... (12,734)
Finance cost on financial instruments with preferred rights at amortized cost ... 104,136
As at 31 December 2022 .......................................... 1,625,922
As at 1 January 2023 ............................................ 1,625,922
Effect of financial instruments with preferred rights at amortized cost (a) ..... 24,000
Reclassification of transaction cost payable included in other payable and
accruals ...................................................... (1,425)
Finance cost on financial instruments with preferred rights at amortized cost ... 117,528
As at 31 December 2023 .......................................... 1,766,025
As at 1 January 2024 ............................................ 1,766,025
Finance cost on financial instruments with preferred rights at amortized cost ... 128,593
As at 31 December 2024 .......................................... 1,894,618
As at 1 January 2024 ............................................ 1,766,025
Financial cost on financial instruments with preferred rights at amortized cost .. 63,119
As at 30 June 2024 (Unaudited) .................................... 1,829,144
As at 1 January 2025 ............................................ 1,894,618
Finance cost on financial instruments with preferred rights at amortized cost ... 67,923
As at 30 June 2025 .............................................. 1,962,541
(a) Series A financing to Series C+ financing
Series A financing
In January 2018, the Company entered into an investment agreement with certain series A
investors, pursuant to which the Company issued and allotted approximately 3,489,000 shares,
representing approximately 34.89% of the equity interests of the Company, to series A investors, at
a consideration of USD30,000,000 (equals to RMB189,288,000). The proceeds of
RMB189,288,000 were received by the Company in February, March and July 2018. The Company
had initially recognized the related financial instruments with preferred rights of RMB189,288,000
APPENDIX I ACCOUNTANTS’ REPORT
– I-116 –


--- page 638 ---
(present value of the estimated amount to be paid out by the Company) in 2018. In February,
March and July 2018, the Company applied a discount rate from 3.53% to 3.56% to derive the
present value of the issued financial instruments.
In June 2019, the Company entered into an investment agreement with certain series A-1
investors, pursuant to which the Company issued and allotted approximately 1,595,745 shares,
representing approximately 6.00% of the equity interests of the Company, to series A-1 investors,
at a consideration of USD12,000,000 (equals to RMB82,716,000). The proceeds of
RMB82,716,000 were received by the Company in June and September 2019. The Company had
initially recognized the related financial instruments with preferred rights of RMB82,716,000
(present value of the estimated amount to be paid out by the Company) in 2019. In June and
September 2019, the Company applied a discount rate from 6.58% to 7.70% to derive the present
value of the issued financial instruments.
In July 2020, the Company entered into investment agreements separately with certain series
A-2 investors, pursuant to which the Company issued and allotted approximately 1,632,309 shares,
representing approximately 5.78% of the equity interests of the Company, to series A-2 investors,
at a consideration of RMB100,139,000. The proceeds of RMB100,139,000 were received by the
Company in July and August 2020. The Company had initially recognized the related financial
instruments with preferred rights of RMB100,139,000 (present value of the estimated amount to be
paid out by the Company) in 2020. In July and August 2020, the Company applied a discount rate
from 7.35% to 7.42% to derive the present value of the issued financial instruments.
In December 2020, the Company entered into an investment agreement with certain series
A-3 investors, pursuant to which the Company issued and allotted approximately 4,163,269 shares,
representing approximately 12.85% of the equity interests of the Company, to series A-3 investors,
at a consideration of RMB281,700,000. The proceeds of RMB281,700,000 were received by the
Company in December 2020 and January 2021. The Company had initially recognized the related
financial instruments with preferred rights of RMB281,700,000 (present value of the estimated
amount to be paid out by the Company) in 2020 and 2021 respectively. In December 2020 and
January 2021, the Company applied a discount rate from 7.49% to 7.72% to derive the present
value of the issued financial instruments.
Series B financing
In March 2021, the Company entered into an investment agreement with certain series B
investors, pursuant to which the Company issued and allotted approximately 3,078,248 shares,
representing approximately 8.68% of the equity interests of the Company, to series B investors, at
a consideration of RMB280,348,000. The proceeds of RMB280,348,000 were received by the
Company in March, April and May 2021. The Company had initially recognized the related
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 639 ---
financial instruments with preferred rights of RMB280,348,000 (present value of the estimated
amount to be paid out by the Company) in 2021. In March, April and May 2021, the Company
applied a discount rate from 6.91% to 8.09% to derive the present value of the issued financial
instruments.
In August 2021, the Company entered into an investment agreement with certain series B+
investors, pursuant to which the Company issued and allotted approximately 1,558,592 shares,
representing approximately 4.21% of the equity interests of the Company, to series B+ investors, at
a consideration of RMB263,650,000. The proceeds of RMB263,650,000 were received by the
Company in August, September, October and November 2021. The Company had initially
recognized the related financial instruments with preferred rights of RMB263,650,000 (present
value of the estimated amount to be paid out by the Company) in 2021. In August, September,
October and November 2021, the Company applied a discount rate from 7.51% to 8.35% to derive
the present value of the issued financial instruments.
Series C financing
In January 2022, the Company entered into an investment agreement with certain series C
investors, pursuant to which the Company issued and allotted approximately 1,251,089 shares,
representing approximately 3.27% of the equity interests of the Company, to series C investors, at
a consideration of RMB270,300,000. The proceeds of RMB270,300,000 were received by the
Company in March, April and June 2022. The Company had initially recognized the related
financial instruments with preferred rights of RMB270,300,000 (present value of the estimated
amount to be paid out by the Company) in 2022. In March, April and June 2022, the Company
applied a discount rate from 7.87% to 8.64% to derive the present value of the issued financial
instruments.
In December 2023, the Company entered into an investment agreement with certain series C+
investors, pursuant to which the Company issued and allotted approximately 102,078 shares,
representing approximately 0.27% of the equity interests of the Company, to series C+ investors, at
a consideration of RMB24,000,000. The proceeds of RMB24,000,000 were received by the
Company in December 2023. The Company had initially recognized the related financial
instruments with preferred rights of RMB24,000,000 (present value of the estimated amount to be
paid out by the Company) in 2023. In December 2023, the Company applied a discount rate of
10.54% to derive the present value of the issued financial instruments.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 640 ---
In accordance with Series A investment agreements to Series C+ investment agreements,
Series A Investors to Series C+ Investors had been granted with certain preferred rights (the
“Preferred Rights ”) upon capital contribution. These Preferred Rights mainly included the
followings:
(b) Key terms
Liquidation preference
In the event of any liquidation, dissolution or winding up of the Company, whether voluntary
or involuntary, all assets and funds of the Company legally available for distribution to the
shareholders shall, by reason of the shareholders’ ownership of the shares, be distributed as
follows:
The holders of the ordinary shares with preferred rights shall be entitled to receive for each
outstanding ordinary shares with preferred rights held and fully paid, as applicable, the amount
equal to one hundred percent of the applicable ordinary shares with preferred rights’ issue price,
plus all declared but unpaid dividends on such ordinary shares with preferred rights. Upon the
liquidation, in order of preference, first to the holders of Series C+ ordinary shares with preferred
rights, then to the holders of Series C ordinary shares with preferred rights, Series B+ ordinary
shares with preferred rights, Series B ordinary shares with preferred rights, Series A-3 ordinary
shares with preferred rights, Series A-2 ordinary shares with preferred rights, Series A-1 ordinary
shares with preferred rights, and last to the holders of Series A ordinary shares with preferred
rights. If there are any assets or funds remaining after the aggregate amount have been distributed
or paid in full to the applicable holders of ordinary shares with preferred rights as above, the
remaining assets and funds legally available for distribution shall be distributed ratably among the
holders of ordinary shares and holders of ordinary shares with preferred rights according to the
relative number of ordinary shares on an as-converted basis.
Anti-dilution right
If the Company increases its paid-in capital/share capital at a price lower than the price paid
by Series A Investors to Series C+ Investors on a per paid-in capital/share capital basis, Series A
Investors to Series C+ Investors have a right to require (i) the Company to issue new paid-in
capital/share capital for nil consideration (or lowest price allowed by law) to Series A Investors to
Series C+ Investors: or (ii) existing shareholders to transfer the equity interests of the Company
directly or indirectly held to Series A Investors to Series C+ Investors for nil consideration (or
lowest price allowed by law), so that the total amount paid by Series A Investors to Series C+
Investors divided by the total amount of paid-in capital/share capital obtained is equal to the price
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 641 ---
per paid-in capital/share capital in the new issuance. The increased shares should have a limitation
which will not cause the percentage of shareholding of the Company held by NovoDriv (HK)
Limited Partnership, the ultimate holding company of the Company, (the “ NovoDriv ”) below 25%.
The directors of the Company considered that the fair value of the anti-dilution right given to
investors was immaterial and therefore no liability was recognised by the Company.
Redemption rights
The Company shall redeem, at the option of any holder of outstanding ordinary shares with
preferred rights, all of the outstanding ordinary shares with preferred rights (other than the unpaid
shares) held by the requesting holder, at any time after (a) the failure by the Company to complete
a Qualified IPO as at 5 February 2026, or (b) the significant violation of the investing agreements,
shareholders agreements, Articles of Association and other related documents by the Company or
NovoDriv or NovoDriv Limited orʮ̡ or ৵ᐂ or ҽዣಱ. The
redemption price for Series A fully paid ordinary shares with preferred rights (other than the
unpaid shares) shall be equal to the ordinary shares with preferred rights’ purchase price, plus an
annual simple interest rate of 4% accrued for the period from the ordinary shares with preferred
rights’ deemed issue date up to and until the date when such ordinary shares with preferred rights
are redeemed, plus all declared but unpaid dividends. The redemption price for Series A-1 fully
paid ordinary shares with preferred rights, Series A-2 fully paid ordinary shares with preferred
rights, Series A-3 fully paid ordinary shares with preferred rights, Series B fully paid ordinary
shares with preferred rights, Series B+ fully paid ordinary shares with preferred rights, Series C
fully paid ordinary shares with preferred rights and Series C+ fully paid ordinary shares with
preferred rights (other than the unpaid shares) shall be equal to the ordinary shares with preferred
rights’ purchase price, plus an annual simple interest rate of 8% accrued for the period from the
ordinary shares with preferred rights’ deemed issue date up to and until the date when such
ordinary shares with preferred rights are redeemed, plus all declared but unpaid dividends.
Upon the redemption, in order of preference, first to the holders of Series C+ ordinary shares
with preferred rights, then to the holders of Series C ordinary shares with preferred rights, Series
B+ ordinary shares with preferred rights, Series B ordinary shares with preferred rights, Series A-3
ordinary shares with preferred rights, Series A-2 ordinary shares with preferred rights, Series A-1
ordinary shares with preferred rights, and last to the holders of Series A ordinary shares with
preferred rights.
If the assets and funds are insufficient for the full payment to redemption of such ordinary
shares with preferred rights, then the entire assets and funds legally available for distribution shall
be distributed ratably among such holders in proportion. If obtain the consent of all requesting
holders, upon the redemption, in order of preference, first to the holders of Series C+ ordinary
APPENDIX I ACCOUNTANTS’ REPORT
– I-120 –


--- page 642 ---
shares with preferred rights, then to the holders of Series C ordinary shares with preferred rights,
Series B+ ordinary shares with preferred rights, Series B ordinary shares with preferred rights,
Series A-3 ordinary shares with preferred rights, Series A-2 ordinary shares with preferred rights,
A-1 ordinary shares with preferred rights, and Series A ordinary shares with preferred rights, and
last to the holders of ordinary shares.
(c) Presentation and Classification
The ordinary shares with preferred rights are classified as financial liabilities. In addition, the
Group measures financial instruments with preferred rights at amortized costs and does not
bifurcate any embedded derivatives from the host instruments.
30 TRADE AND NOTES PAYABLES
The suppliers usually grant a credit period of 0 days to 90 days to the Group and the
Company, and extended to a credit period of 18 months from major suppliers. As at 31 December
2022, 31 December 2023, 31 December 2024 and 30 June 2025, the aging analysis of the trade
payables based on transaction date are as follows:
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current
Trade payables .................. — — — 20,251
Current
Trade payables
— The third party ................ 39,274 41,006 63,299 365,616
— The related party .............. —8 3——
39,274 41,089 63,299 365,616
Notes payables .................. 2,256 29,600 — 12,092
41,530 70,689 63,299 377,708
APPENDIX I ACCOUNTANTS’ REPORT
– I-121 –


--- page 643 ---
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the aging
analysis of trade payables are as follows:
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Up to 6 months .................. 27,935 23,526 32,411 342,907
6 to 12 months .................. 3,094 7,278 17,336 14,549
over 12 months .................. 8,245 10,285 13,552 28,411
39,274 41,089 63,299 385,867
The carrying amounts of trade payables are considered approximately to their fair values.
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Non-current
Trade payables .................. — — — 20,251
Current
Trade payables
— The third party ................ 37,359 36,344 62,291 364,368
— The subsidiaries ............... 10,719 16,802 13,683 17,973
— The related party .............. —8 3——
48,078 53,229 75,974 382,341
Notes payables .................. 2,256 29,600 — 12,092
50,334 82,829 75,974 394,433
APPENDIX I ACCOUNTANTS’ REPORT
– I-122 –


--- page 644 ---
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the aging
analysis of trade payables are as follows:
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Up to 6 months .................. 38,229 39,278 36,967 360,649
6 to 12 months .................. 2,981 4,989 24,213 14,184
over 12 months .................. 6,868 8,962 14,794 27,759
48,078 53,229 75,974 402,592
31 OTHER PAYABLES AND ACCRUALS
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Payroll and welfare payables ........ 30,384 25,370 27,030 14,311
Repayable government grants (a) .... 2 , 3 6 0———
Other taxes payable ............... 1,791 264 3,689 1,957
Amount due to the third parties (b) ... 500 3,562 6,111 501
Other payable arising from the
transaction of ancillary services (c) . 419 34,523 11,837 13,633
Accruals ....................... 1,008 2,379 2,661 2,132
Payables for purchases of PPE ...... 40,168 38,755 39,986 39,106
Payables for purchases of intangible
assets ........................ 9 8———
Transaction costs payable (d) ....... — 1 , 4 2 6——
Financial guarantee contracts
liability (e) ................... — 186 6,452 50,515
Accrued listing expenses ........... — — 3,941 11,676
76,728 106,465 101,707 133,831
APPENDIX I ACCOUNTANTS’ REPORT
– I-123 –


--- page 645 ---
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Payroll and welfare payables ........ 27,625 23,515 25,456 13,401
Repayable government grants (a) .... 2 , 3 6 0———
Other taxes payable ............... 22 107 3,240 1,869
Amount due to the third parties (b) ... 500 3,562 6,111 501
Amount due to a subsidiary (f) ...... — — 695 684
Other payable arising from the
transaction of ancillary services (c) . 409 7,126 4,571 6,367
Accruals ....................... 1,008 2,305 2,361 1,899
Payables for purchases of PPE ...... — 242 25 258
Payables for purchases of intangible
assets ........................ 9 8———
Transaction costs payable (d) ....... — 1 , 4 2 6——
Financial guarantee contracts
liability (e) ................... — 186 6,452 50,515
Accrued listing expenses ........... — — 3,941 11,676
32,022 38,469 52,852 87,170
(a) As the agreement agreed, the Company should achieve the performance appraisal otherwise the government grants
should be repaid. During the year ended 31 December 2022, according to the results of performance appraisal, the
Company failed to meet the requirements, and the deferred income was derecognized. The repayable government
grants were repaid to the government in April 2023.
(b) Amount due to the third parties are trade nature, unsecured, interest free and repayable on demand.
(c) Other payable arising from the transaction of ancillary services represent proceeds received from the customers and
yet to be paid to the third party suppliers on behalf of the customers arising from the transaction of ancillary
services relating to V2X for the Group acting as an agent. Please refer to Note 24 for more details. The payable are
trade nature, unsecured, interest-free and repayable on demand.
(d) Transaction costs payable represent payable to the agencies for acquisition of capital contributions from investors.
(e) In September 2023, the Company entered into a guarantee agreement in favour of Jiangsu Financial Leasing Co.,
Ltd. (“ Jiangsu Financial Leasing ”) to provide guarantee for the buyer credit loan in the maximum principal
amount of RMB20 million made available by Jiangsu Financial Leasing to Henan Yuda Industry and Trade Co.,
APPENDIX I ACCOUNTANTS’ REPORT
– I-124 –


--- page 646 ---
Ltd. (“ Henan Yuda ”) and Henan Anda Blasting Co., Ltd. (“ Henan Anda ”). Henan Yuda and Henan Anda are
independent of the Group and are the end users of the products and solutions sold by the Company. Under the
guarantee agreement, the Company assumes joint guarantee liability with the principal debtors, Henan Yuda and
Henan Anda. The guarantee covers 20% of the principal amount advanced by Jiangsu Financial Leasing with
overdue interest and any other amounts payable by Henan Yuda and Henan Anda under the relevant loan agreement
and the amount of guarantee would not exceed RMB4 million. The guarantee periods start from the data of expiry
of the buyer credit loan to three years later.
In March 2024, the Company entered into a guarantee agreement in favour of Haitong Unitrust International
Financial Leasing Co., Ltd. (“ Haitong Unitrust ”) to provide guarantee for the buyer credit loan in the maximum
principal amount of RMB70 million made available by Haitong Unitrust to Anhui Beishan Engineering Technology
Co., Ltd. (“ Anhui Beishan ”). Anhui Beishan is independent of the Company and is the end user of the products
and solutions sold by the Company. Under the guarantee agreement, the Company assumes joint guarantee liability
with the principal debtor, Anhui Beishan. The guarantee covers the principal amount advanced by Haitong Unitrust
with overdue interest and any other amounts payable by Anhui Beishan under the relevant loan agreement and the
amount of guarantee would not exceed RMB70 million. The guarantee periods start from the data of expiry of the
buyer credit loan to three years later. The fair value of the financial guarantee contracts provided for Jiangsu
Financial Leasing and Haitong Unitrust on initial recognition was determined by Avista Limited, a professional
valuer independent to the Group. The details of impairment assessment subsequent to the initial recognition are set
out in note 3.1(b) to the Historical Financial Information.
As at 31 December 2022, 31 December 2023, 31 December 2024 and 30 June 2025, the financial guarantee
contracts liability of nil, RMB186,000, RMB6,452,000 and RMB50,515,000 was recognized respectively in “other
payables” in the consolidated statements of financial position.
(f) Amount due to a subsidiary is non-trade nature, unsecured, interest free and repayable on demand.
32 PROVISION
The Group
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Provision for warranties (a)......... 1,938 4,743 16,886 34,368
Provision for outstanding
litigation (b) .................. — — 849 849
1,938 4,743 17,735 35,217
(a) Provision for warranties are recognized when the Group has a present obligation (legal or constructive) as a result
of the sales contracts it is probable that the Group will be required to settle that obligation and a reliable estimate
can be made of the amount of the obligation.
APPENDIX I ACCOUNTANTS’ REPORT
– I-125 –


--- page 647 ---
(b) The Group has been informed that a supplier provided construction services has started legal proceedings against
the Group for collection of construction payments and related interests in December 2024. As at the date of this
report, the legal case has been docketed by the court in the PRC, and the legal case will be heard in 2026. In
February 2025, a PRC court issued an asset preservation order on a building and three bank accounts owned by the
Group. These bank accounts with total carrying amounts of RMB8.8 million of the Group were frozen and will be
released when the legal case resolves. Details of the order on the building are set out in note 16 of the Historical
Financial Information. The Group has recorded the unpaid construction services fee in “Other payables” and the
related interests in “Provision for outstanding litigation”.
The movements of the Group’s provision are analyzed as follows:
The Group
Provision for
warranties
Provision for
outstanding
litigation Total
RMB’000 RMB’000 RMB’000
As at 1 January 2022 ................. 4,048 — 4,048
Provision for the year ................. 1,375 — 1,375
Amounts utilized during the year ........ (3,485) — (3,485)
As at 31 December 2022 ............... 1,938 — 1,938
As at 1 January 2023 ................. 1,938 — 1,938
Provision for the year ................. 5,368 — 5,368
Amounts utilized during the year ........ (2,563) — (2,563)
As at 31 December 2023 ............... 4,743 — 4,743
As at 1 January 2024 ................. 4,743 — 4,743
Provision for the year ................. 16,931 849 17,780
Amounts utilized during the year ........ (4,788) — (4,788)
As at 31 December 2024 ............... 16,886 849 17,735
As at 1 January 2024 ................. 4,743 — 4,743
Provision for the period ............... 11,502 — 11,502
Amounts utilized during the six-month
period ........................... (1,680) — (1,680)
As at 30 June 2024 (Unaudited) ......... 14,565 — 14,565
As at 1 January 2025 ................. 16,886 849 17,735
Provision for the period ............... 19,373 — 19,373
Amounts utilized during the six-month
period ........................... (1,891) — (1,891)
As at 30 June 2025 ................... 34,368 849 35,217
APPENDIX I ACCOUNTANTS’ REPORT
– I-126 –


--- page 648 ---
The Company
As at 31 December
As at
30 June
20252022 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Provision for warranties ........... 1,846 4,587 16,595 34,040
The movements of the Company’s provision are analyzed as follows:
The Company
Provision for
warranties
RMB’000
As at 1 January 2022 ............................................. 3,944
Provision for the year ............................................. 1,357
Amounts utilized during the year .................................... (3,455)
As at 31 December 2022 ........................................... 1,846
As at 1 January 2023 ............................................. 1,846
Provision for the year ............................................. 5,216
Amounts utilized during the year .................................... (2,475)
As at 31 December 2023 ........................................... 4,587
As at 1 January 2024 ............................................. 4,587
Provision for the year ............................................. 16,731
Amounts utilized during the year .................................... (4,723)
As at 31 December 2024 ........................................... 16,595
As at 1 January 2024 ............................................. 4,587
Provision for the period ........................................... 11,457
Amounts utilized during the six-month period ........................... (1,642)
As at 30 June 2024 (Unaudited) ..................................... 14,402
As at 1 January 2025 ............................................. 16,595
Provision for the period ........................................... 19,332
Amounts utilized during the six-month period ........................... (1,887)
As at 30 June 2025 .............................................. 34,040
APPENDIX I ACCOUNTANTS’ REPORT
– I-127 –


--- page 649 ---
33 RECONCILIATION OF LIABILITIES FROM FINANCING ACTIVITIES
Financial
instruments
with preferred
rights at
amortized
costs
(Note 29)
Lease
liabilities
(Note 17)
Borrowings
(Note 28) Total
RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2022 ............ 1,264,220 10,280 — 1,274,500
Cash flows ..................... — (7,209) 143,126 135,917
New leases ..................... — 3,186 — 3,186
Lease deduction ................. — (166) — (166)
Finance cost on financial instruments
with preferred rights at amortized
cost ......................... 104,136 — — 104,136
Effect of financial instruments with
preferred rights at amortized cost
(Note 29) .................... 270,300 — — 270,300
Reclassification of transaction cost
payable included in other payable
and accruals ................... (12,734) — — (12,734)
Interest expenses ................. — 350 1,156 1,506
Interest expenses
— capitalization ............... — — 2,124 2,124
As at 31 December 2022 .......... 1,625,922 6,441 146,406 1,778,769
APPENDIX I ACCOUNTANTS’ REPORT
– I-128 –


--- page 650 ---
Financial
instruments
with preferred
rights at
amortized
costs
(Note 29)
Lease
liabilities
(Note 17)
Borrowings
(Note 28) Total
RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2023 ............ 1,625,922 6,441 146,406 1,778,769
Cash flows ..................... — (8,629) (24,597) (33,226)
New leases ..................... — 5,904 — 5,904
Lease deduction ................. — (13) — (13)
Finance cost on financial instruments
with preferred rights at amortized
cost ......................... 117,528 — — 117,528
Effect of financial instruments with
preferred rights at amortized cost
(Note 29) ..................... 24,000 — — 24,000
Reclassification of transaction cost
payable included in other payable
and accruals ................... (1,425) — — (1,425)
Interest expenses ................. — 208 3,364 3,572
Interest expenses
— capitalization ............... — — 2,361 2,361
Lease termination ................ — (323) — (323)
As at 31 December 2023 .......... 1,766,025 3,588 127,534 1,897,147
APPENDIX I ACCOUNTANTS’ REPORT
– I-129 –


--- page 651 ---
Financial
instruments
with preferred
rights at
amortized
costs
(Note 29)
Lease
liabilities
(Note 17)
Borrowings
(Note 28) Total
RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2024 ............ 1,766,025 3,588 127,534 1,897,147
Cash flows ..................... — (5,683) 103,250 97,567
New leases ..................... — 6,515 — 6,515
Finance cost on financial instruments
with preferred rights at amortized
cost ......................... 128,593 — — 128,593
Interest expenses ................. — 165 6,958 7,123
Lease termination ................ — (592) — (592)
As at 31 December 2024 .......... 1,894,618 3,993 237,742 2,136,353
As at 1 January 2024 ............ 1,766,025 3,588 127,534 1,897,147
Cash flows ..................... — (2,262) 38,621 36,359
New leases ..................... — 6,515 — 6,515
Finance cost on financial instruments
with preferred rights at amortized
cost ......................... 63,119 — — 63,119
Interest expenses ................. — 68 3,431 3,499
Lease termination ................ — (163) — (163)
As at 30 June 2024 (Unaudited) .... 1,829,144 7,746 169,586 2,006,476
As at 1 January 2025 ............ 1,894,618 3,993 237,742 2,136,353
Cash flows ..................... — (2,976) 83,360 80,384
New leases ..................... — 5,636 — 5,636
Finance cost on financial instruments
with preferred rights at amortized
cost ......................... 67,923 — — 67,923
Interest expenses ................. — 32 4,582 4,614
Other non-cash movements ......... — (568) — (568)
As at 30 June 2025 .............. 1,962,541 6,117 325,684 2,294,342
APPENDIX I ACCOUNTANTS’ REPORT
– I-130 –


--- page 652 ---
34 COMMITMENTS
(a) As at 31 December 2023, the Company has commitment to the limited partnership fund
investments amounted to RMB8.80 million. In December 2024 and January 2025, the
Company injected capital of RMB0.5 million and RMB0.5 million, respectively, to these fund
investments. The residual committed amount will be due for payment before August 2030.
(b) As at 31 December 2024 and 30 June 2025, the Company has commitment to inject capital to
its subsidiary, Anhui CiDi Engineering Technology Co., Ltd, amounted to RMB2.55 million.
The committed amount will be due for payment before May 2029.
35 RELATED PARTY TRANSACTIONS
Parties are considered to be related if one party has the ability, directly or indirectly, control
the other party or exercise significant influence over the other party in making financial and
operation decisions. Parties are also considered to be related if they are subject to common control.
Members of key management and their close family member of the Group are also considered as
related parties.
The following significant transactions were carried out between the Group and its related
party during the periods presented. In the opinion of the directors of the Company, the related
party transactions were carried out in the normal course of business and at terms negotiated
between the Group and the respective related parties.
(a) Name and relationship of related parties
Name of related parties Relationship with the Group
ᜳዚኜɛ (୷)ʮ̡ The same director
ʮ̡ The same director
Ҧ (ଉέ)ʮ̡ The same director
ʮ̡ The same director
Υྫ Ultimate holding company
Tangram. Al. Inc. Controlled by the immediate family member of
the director
APPENDIX I ACCOUNTANTS’ REPORT
– I-131 –


--- page 653 ---
Name of related parties Relationship with the Group
ʮ̡ Controlled by the ultimate controlling
shareholder of the Company
௴ኪ৫ Controlled by the ultimate controlling
shareholder of the Company
(b) Transactions with related parties
(i) Purchase from the related parties
Y ear ended 31 December Six months ended 30 June
The Company Relationship 2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
ᜳዚኜɛ (୷)ʮ̡ ......... Purchase goods 21 274 — — 35
ʮ̡ .. Purchase services 346 ————
Ҧ (ଉέ)ʮ̡ ........ Purchase goods 90 ————
Tangram. Al. Inc. .............. Purchase services 1,901 ————
௴ኪ৫ ................ Purchase services ———— 6
2,358 274 — — 41
Note: In June 2020, the Company entered into a management services agreement contract with NovoDriv, the ultimate
holding company of the Company, and paid RMB3.66 million in accordance with the terms. In February 2023,
NovoDriv and the Company confirmed that the service had not yet been provided, and agreed to sign the
termination agreement. NovoDriv repaid the amounts of RMB3 million and RMB0.66 million in April 2023 and
June 2024 respectively.
(ii) Advance to the related parties
Y ear ended 31 December Six months ended 30 June
Start date End date 2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
୷̹ҽ໊ІਗʷҦஔ
ʮ̡ ...........
1/6/2023 2/9/2023 — 3,000 — — —
— 3,000 — — —
APPENDIX I ACCOUNTANTS’ REPORT
– I-132 –


--- page 654 ---
(iii) Repayment from the related parties
Y ear ended 31 December Six months ended 30 June
Start date End date 2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Υྫ ...... 11/8/2021 No fixed term — 3,000 660 660 —
୷̹ҽ໊ІਗʷҦஔ
ʮ̡ ...........
1/6/2023 2/9/2023 — 3,000 — — —
— 6,000 660 660 —
(iv) Interest from the related party
Y ear ended 31 December Six months ended 30 June
Start date End date 2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
୷̹ҽ໊ІਗʷҦஔ
ʮ̡ ...........
1/6/2023 2/9/2023 — 17 — — —
(c) Y ear/Period end balance with related parties
(i) Amounts due from the related parties
As at 31 December As at 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Υྫ ............. 3,660 660 — — —
ᜳዚኜɛ (୷)ʮ̡ ......... 4 0————
ʮ̡ ...... ———— 2 0 5
௴ኪ৫ ................. ————3 0
3,700 660 — — 235
APPENDIX I ACCOUNTANTS’ REPORT
– I-133 –


--- page 655 ---
(ii) Amounts due to a related party
As at 31 December As at 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
ᜳዚኜɛ (୷)ʮ̡ ......... —8 3———
—8 3———
Amounts due from a related party and amounts due to a related party were trade in nature.
(d) Key management personnel compensation
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Wages, salaries and bonuses ........ 3,236 4,462 4,551 1,665 2,116
Share-based compensation expenses .... — — 19,452 — 21,421
Pension obligations, housing funds,
medical insurances and other social
insurances .................. 48 65 333 108 205
3,284 4,527 24,336 1,773 23,742
36 CONTINGENT LIABILITIES
Saved as disclosed in note 27 (b) to the Historical Financial Information, no other material
contingent liabilities undertaken by or impacted on the Company or the Group as at each reporting
date during the Track Record Period.
37 PAID-IN CAPITAL
Paid-in capital are generated from founders’ and investors’ capital injection. The excess of
total consideration raised over paid-in capital was credited to the Company’s capital reserve (Note
39).
APPENDIX I ACCOUNTANTS’ REPORT
– I-134 –


--- page 656 ---
Authorized and issued
The Group and Company
Number of
ordinary shares
Equivalent
nominal value of
shares
’000 RMB’000
As at 1 January 2022 ............................... 37,028 37,028
Capital contributions from series C investors ............. 1,251 1,251
As at 31 December 2022 and 1 January 2023 ............. 38,279 38,279
Capital contributions from series C+ investors ............ 102 102
As at 31 December 2023, 1 January 2024 ................ 38,381 38,381
Conversion into a joint stock limited company (Note 38 (a)) . (38,381) (38,381)
As at 31 December 2024 and 30 June 2025 .............. ——
(a) In December 2020, the Company entered into an investment agreement with series A-3 investors, pursuant to which
total capital of RMB281,700,000 was contributed into the Company. The proceeds of RMB191,700,000 were
received by the Company in December 2020. The remaining proceeds of RMB90,000,000 were received by the
Company in Jan 2021, with RMB4,163,269 and RMB277,536,731 credited to the Company’s paid-in capital and
capital reserves, respectively (Note 39). Certain preferred rights upon capital contribution were granted to series
A-3 investors (Note 29).
(b) In March 2021, the Company entered into an investment agreement with series B investors, pursuant to which total
capital of RMB280,347,776 was contributed into the Company. The proceeds of RMB280,347,776 were received by
the Company in March, April and May 2021, with RMB3,078,248 and RMB277,269,528 credited to the Company’s
paid-in capital and capital reserves, respectively (Note 39). Certain preferred rights upon capital contribution were
granted to series B investors (Note 29).
(c) In August 2021, the Company entered into an investment agreement with series B+ investors, pursuant to which
total capital of RMB263,650,000 was contributed into the Company. The proceeds of RMB263,650,000 were
received by the Company in August, September, October and November 2021, with RMB1,558,592 and
RMB262,091,408 credited to the Company’s paid-in capital and capital reserves, respectively (Note 39). Certain
preferred rights upon capital contribution were granted to series B+ investors (Note 29).
APPENDIX I ACCOUNTANTS’ REPORT
– I-135 –


--- page 657 ---
(d) In January 2022, the Company entered into an investment agreement with series C investors, pursuant to which
total capital of RMB270,300,000 was contributed into the Company. The proceeds of RMB270,300,000 were
received by the Company in March, April and June 2022, with RMB1,251,089 and RMB269,048,911 credited to the
Company’s paid-in capital and capital reserves, respectively (Note 39). Certain preferred rights upon capital
contribution were granted to series C investors (Note 29).
(e) In December 2023, the Company entered into an investment agreement with a series C investor, pursuant to which
total capital of RMB24,000,000 was contributed into the Company. The proceeds of RMB24,000,000 were received
by the Company in December 2023, with RMB102,078 and RMB23,897,922 credited to the Company’s paid-in
capital and capital reserves, respectively (Note 39). Certain preferred rights upon capital contribution were granted
to series C+ investor (Note 29).
38 SHARE CAPITAL
The Group and Company
Number of
ordinary shares Share capital
’000 RMB’000
As at 1 January 2024 ............................... ——
Conversion into a joint stock limited company (a) ......... 38,381 38,381
As at 31 December 2024 and 30 June 2025 .............. 38,381 38,381
(a) In July 2024, as approved in the shareholders’ general meeting, the Company was converted into a joint stock
company with limited liability under the Company Law of the PRC. The Company has transferred its capital
reserve and accumulated loss of RMB1,460,415,000 and RMB558,800,000, respectively, to share capital of
approximately 38,381,000 ordinary shares at RMB1.0 each, with the excess credited to the Company’s share
premium (Note 39).
APPENDIX I ACCOUNTANTS’ REPORT
– I-136 –


--- page 658 ---
39 TREASURY STOCK AND RESERVES
The Group
Reserves
Treasury
stock
(Note (a))
Share
premium
Capital
Reserve
Employee
share-based
compensation
reserve
Exchange
reserve Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2022 ......... (1,197,841) — 1,167,468 — — 1,167,468
Capital contributions from series C
investors ............... — — 269,049 — — 269,049
Effect of financial instruments
with preferred rights at
amortized costs ........... (270,300) —————
As at 31 December 2022 and
1 January 2023 ........... (1,468,141) — 1,436,517 — — 1,436,517
Capital contributions from series
C+ investors ............. — — 23,898 — — 23,898
Effect of financial instruments
with preferred rights at
amortized costs ........... (24,000) —————
As at 31 December 2023 and
1 January 2024 ........... (1,492,141) — 1,460,415 — — 1,460,415
Change in foreign currency
translation of the financial
statements of the subsidiaries of
the Company ............ ————2 12 1
Conversion into a joint stock
company (Note 38(a)) ....... — 901,615 (1,460,415) — — (558,800)
Share-based payment (Note 40) ... — — — 319,944 — 319,944
As at 31 December 2024 and
1 January 2025 ........... (1,492,141) 901,615 — 319,944 21 1,221,580
Change in foreign currency
translation of the financial
statements of the subsidiaries of
the Company ............ ———— (14) (14)
Contribution from non-controlling
interests with change of the
ownership interest in a
subsidiary that do not result in a
loss of control (Note 15(a)(d)) .. —6 7———6 7
Share-based payment (Note 40) ... — — — 266,568 — 266,568
As at 30 June 2025 .......... (1,492,141) 901,682 — 586,512 7 1,488,201
APPENDIX I ACCOUNTANTS’ REPORT
– I-137 –


--- page 659 ---
(a) The Group recorded treasury stock to reflect the carrying amount of the financial instruments with preferred rights
at the date of issuance of the Series A financing to Series C+ financing. Further details are described in Note 29
(a).
The Company
Reserves
Treasury
stock
(Note (a))
Share
premium
Capital
Reserve
Employee
share-based
compensation
reserve
Exchange
reserve Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2022 ......... (1,197,841) — 1,167,468 — — 1,167,468
Capital contributions from series C
investors ............... — — 269,049 — — 269,049
Effect of financial instruments
with preferred rights at
amortized costs ........... (270,300) —————
As at 31 December 2022 and
1 January 2023 ........... (1,468,141) — 1,436,517 — — 1,436,517
Capital contributions from series
C+ investors ............. — — 23,898 — — 23,898
Effect of financial instruments
with preferred rights at
amortized costs ........... (24,000) —————
As at 31 December 2023 and
1 January 2024 ........... (1,492,141) — 1,460,415 — — 1,460,415
Conversion into a joint stock
company (Note 38(a)) ....... — 901,615 (1,460,415) — — (558,800)
Share-based payment (Note 40) ... — — — 319,944 — 319,944
As at 31 December 2024 and 1
January 2025 ............ (1,492,141) 901,615 — 319,944 — 1,221,559
Share-based payment (Note 40) ... — — — 266,568 — 266,568
As at 30 June 2025 .......... (1,492,141) 901,615 — 586,512 — 1,488,127
40 EQUITY-SETTLED SHARE-BASED PAYMENT
The Company has adopted a Pre-IPO share option scheme pursuant to a resolution passed on
23 September 2024 (the “ 2024 Share Option Scheme ”).
APPENDIX I ACCOUNTANTS’ REPORT
– I-138 –


--- page 660 ---
The purpose of the 2024 Share Option Scheme is to recognize the contribution or future
contribution of the Eligible Participants (as defined below) for their contribution to the Group by
granting options to them as incentives or rewards and to attract, retain and motivate high-calibre
Eligible Participants in line with the performance goals of the Group.
The Eligible Participants of the 2024 Share Option Scheme include the directors and
employees of the Company or any of its subsidiaries and any persons (whether a natural person, a
corporate entity or otherwise) who provide consultancy services to the Group.
Under the 2024 Share Option Scheme, the Company will grant option(s) (“ Option(s) ”) to
Scheme Participants to acquire the shares of Changsha Gangwan Investment Partnership (Limited
Partnership) (“ Changsha Gangwan ”), the immediate holding company of the Company. The
Eligible Participants shall not have any interest or economic rights (including the rights to receive
dividends) in the shares of Changsha Gangwan prior to the vesting of the options. According to the
scheme, Changsha Gangwan is required to keep a minimum percentage equity interest in the
Company. As at 31 December 2024 and 30 June 2025, the registered shares of the Company is
38,381,330 Shares. 89,560,000 Options and 4,020,000 Options of Changsha Gangwan have been
granted to 389 and 19 Eligible Participants under the 2024 Share Option Scheme at an exercise
price ranging from RMB0.001 to RMB1 per Option during the year ended 31 December 2024 and
the period ended 30 June 2025. The share options granted to the Eligible Participants shall be
vested by various types: (a) 100% after the qualified initial public offering of the Company is
completed, (b) 75% after the qualified initial public offering of the Company is completed, and
25% in March 2026, (c) 25% after the qualified initial public offering of the Company is
completed, and 25%, 25% and 25% in December 2025, December 2026 and December 2027
respectively, (d) 25% after the qualified initial public offering of the Company is completed, and
25%, 25% and 25% in September 2026, September 2027 and September 2028 respectively, (e)
25% after the qualified initial public offering of the Company is completed, and 25%, 25% and
25% in September 2026, September 2027 and September 2028 respectively, (f) 25% after the
qualified initial public offering of the Company is completed, and 25%, 25% and 25% in October
2026, October 2027 and October 2028 and (g) 25%, 25%, 25% and 25% in January 2026, January
2027, January 2028 and January 2029 respectively. The share options shall be vested in yearly
instalments of agreed percentage at each agreed date commencing from the vesting commencement
date.
The share options under the 2024 Share Option Scheme have an exercise period of ten years
from the grant date. According to the 2024 Share Option Scheme, the granted shares can be vested
when the conditions of vesting are satisfied and the qualified initial public offering of the
Company is completed, subject to employees’ continuous service to the Group.
APPENDIX I ACCOUNTANTS’ REPORT
– I-139 –


--- page 661 ---
During the year ended 31 December 2024 and the period ended 30 June 2025, the Group
recognized share-based compensation expenses of RMB319,944,000 and RMB266,568,000 in
profit or loss over its relevant vesting periods with a corresponding increase in employee
share-based compensation reserve. Share-based compensation expenses have been recognized as
follows:
Y ear ended 31 December Six months ended 30 June
2022 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Research and development expenses .... — — 109,529 — 107,692
General and administrative expenses ... — — 176,166 — 137,743
Selling expenses ................ — — 21,591 — 21,010
Costs of inventories .............. — — 12,658 — 123
— — 319,944 — 266,568
The following Options were outstanding during the Track Record Period:
Date of grant Vesting Period
Number of Options
As at
1 January 2024 Granted Forfeited (a)
As at
31 December
2024 and
1 January 2025 Granted Forfeited (a)
As at
30 June 2025
27 September
2024 ....
27 September 2024−
The date of qualified initial
public offering of the
Company is completed — 51,052,500 (42,500) 51,010,000 — (97,500) 50,912,500
27 September 2024−
31 December 2025 — 3,172,500 — 3,172,500 — — 3,172,500
27 September 2024−
31 March 2026 — 200,000 — 200,000 — — 200,000
27 September 2024−
26 September 2026 — 9,430,000 (42,500) 9,387,500 — (97,500) 9,290,000
27 September 2024−
31 December 2026 — 3,172,500 — 3,172,500 — — 3,172,500
27 September 2024−
26 September 2027 — 9,430,000 (42,500) 9,387,500 — (97,500) 9,290,000
27 September 2024−
31 December 2027 — 3,172,500 — 3,172,500 — — 3,172,500
APPENDIX I ACCOUNTANTS’ REPORT
– I-140 –


--- page 662 ---
Date of grant Vesting Period
Number of Options
As at
1 January 2024 Granted Forfeited (a)
As at
31 December
2024 and
1 January 2025 Granted Forfeited (a)
As at
30 June 2025
27 September 2024−
26 September 2028 — 9,430,000 (42,500) 9,387,500 — (97,500) 9,290,000
10 October
2024 ....
10 October 2024−
The date of qualified initial
public offering of the
Company is completed — 75,000 — 75,000 — — 75,000
10 October 2024−
26 September 2026 — 75,000 — 75,000 — — 75,000
10 October 2024−
26 September 2027 — 75,000 — 75,000 — — 75,000
10 October 2024−
26 September 2028 — 75,000 — 75,000 — — 75,000
1 November
2024 ....
1 November 2024−
The date of qualified initial
public offering of the
Company is completed — 50,000 — 50,000 — — 50,000
1 November 2024−
29 October 2026 — 50,000 — 50,000 — — 50,000
1 November 2024−
29 October 2027 — 50,000 — 50,000 — — 50,000
1 November 2024−
29 October 2028 — 50,000 — 50,000 — — 50,000
9 January
2025 ....
9 January 2025−
8 January 2026 ———— 1,005,000 — 1,005,000
9 January 2025−
8 January 2027 ———— 1,005,000 — 1,005,000
9 January 2025−
8 January 2028 ———— 1,005,000 — 1,005,000
9 January 2025−
8 January 2029 ———— 1,005,000 — 1,005,000
— 89,560,000 (170,000) 89,390,000 4,020,000 (390,000) 93,020,000
(a) Two employees of the Company resigned in 2024 and five employees of the Company resigned in 2025, and the
granted share options were forfeited.
APPENDIX I ACCOUNTANTS’ REPORT
– I-141 –


--- page 663 ---
The fair value of the share options granted on 27 September 2024 was between RMB287.06
and RMB288.04 per share and the exercise price was between RMB0.001 and RMB1 per Option,
the fair value of the share options granted on 10 October 2024 was RMB287.11 per share and the
exercise price was RMB1 per Option, the fair value of the share options granted on 1 November
2024 was RMB287.08 per share and the exercise price was RMB1 per Option and the fair value of
the share options granted on 9 January 2025 was RMB294.71 per share and the exercise price was
RMB1 per Option.
The fair value of 2024 Share Option Scheme was estimated as at the date of grant using a
binomial model, taking into account the terms and conditions upon which the options were
granted. The following table lists the inputs to the model used:
27 September
2024
10 October
2024
1 November
2024
9 January
2025
Dividend yield (%) ............... ————
Expected V olatility (%) ............ 49.16 49.22 49.46 49.71
Risk-free interest rate (%) .......... 2.16 2.13 2.12 1.64
Expected life of options (years) ..... 10 10 10 10
Minimum shares of the Company held
by Changsha Gangwan ...........
4,104,788
shares
4,118,615
shares
4,127,832
shares
4,313,114
shares
The expected volatility reflects the assumption that the historical volatility is indicative of
future trends, which may also not necessarily be the actual outcome.
41 DIVIDEND
No dividend has been paid or declared by the Company or subsidiaries of the Company
during the Track Record Period and up to the date of this report.
42 SUBSEQUENT EVENTS
Saved as disclosed elsewhere in the Historical Financial Information, no material subsequent
events undertaken by or impacted on the Company or the Group subsequent to 30 June 2025 and
up the date of this report.
III SUBSEQUENT FINANCIAL STATEMENTS
No audited financial statements have been prepared for the Company or any of its
subsidiaries in respect of any period subsequent to 30 June 2025 and up to the date of this report.
APPENDIX I ACCOUNTANTS’ REPORT
– I-142 –


--- page 664 ---
The information set out in this Appendix II does not form part of the Accountants’ Report
from BDO Limited, Certified Public Accountants, the reporting accountant of the Company, as set
out in Appendix I to this prospectus, and is included herein for illustrative purposes only. The
unaudited pro forma financial information should be read in conjunction with the section headed
“Financial Information” in this 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 is the unaudited pro forma statement of adjusted consolidated net tangible
assets of the Group attributable to the equity holders of the Company (the “ Unaudited Pro Forma
Financial Information ”) which has been prepared in accordance with Rule 4.29 of the Listing
Rules and on the basis of the notes set out below for the purpose to illustrate the effect of the
Global Offering (as defined in the prospectus) on the consolidated net tangible liabilities of the
Group attributable to the equity holders of the Company as at 30 June 2025 as if the Global
Offering had taken place on 30 June 2025.
The Unaudited Pro Forma Financial Information is prepared based on the consolidated net
liabilities of the Group attributable to the equity holders of the Company as at 30 June 2025 as set
out in the Accountants’ Report of the Group, the text of which is set out in Appendix I to this
prospectus, after incorporating the unaudited pro forma adjustments described in the accompanying
notes below.
The Unaudited Pro Forma Financial Information has been prepared by the Directors for
illustrative purposes only, based on the judgements and assumptions of the Directors, and because
of its hypothetical nature, it may not give a true picture of the consolidated net tangible assets of
the Group attributable to the equity holders of the Company had the Global Offering been
completed as at 30 June 2025 or at any future dates following the Global Offering.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-1 –


--- page 665 ---
Audited
consolidated net
tangible
liabilities of the
Group
attributable to
the equity
holders of the
Company as at
30 June 2025
Estimated net
proceeds from
the Global
Offering
Reclassification
of shares with
preferred rights
upon the
completion of
Global Offering
Unaudited pro
forma adjusted
consolidated net
tangible assets
of the Group
attributable to
the equity
holders of the
Company as at
30 June 2025
Unaudited pro forma adjusted
consolidated net tangible assets of
the Group attributable to the
equity holders of the Company
per Share
RMB’000 RMB’000 RMB’000 RMB’000 RMB HK$
Note 1 Note 2 Note 3 Note 4 Note 5
Based on the Offer Price of
HK$263.00 per
H Share ............ (1,307,547) 1,210,924 1,962,541 1,865,918 42.61 46.89
Notes:
1. The audited consolidated net tangible liabilities of the Group attributable to the equity holders of the Company as
at 30 June 2025 is extracted from the Accountants’ Report set out in Appendix I to this prospectus, which is based
on the audited consolidated net liabilities of the Group attributable to the equity holders of the Company as at 30
June 2025 of approximately RMB1,305,605,000 with adjustment for the intangible assets as at 30 June 2025 of
approximately RMB1,942,000.
2. The estimated net proceeds from the Global Offering are based on 5,407,980 Offer Shares and the Offer Price of
HK$263.00 per H Share, after deduction of the underwriting fees and other related expenses (excluding the listing
expenses that have been charged to profit or loss during the Track Record Period), without taking into account of
any Shares which may be allotted pursuant to the exercise of the Over-allotment Option or any shares which may
be issued by the Company pursuant to the general mandates. The estimated net proceeds from the Global Offering
are converted from Hong Kong dollars to Renminbi based on the exchange rate as detailed in note 5 below.
3. Upon the completion of Global Offering as at 30 June 2025, all preferred rights entitled to the Company’s investors
will be expired and the financial instruments with preferred rights at amortized cost recognized due to these
preferred rights would have been reclassified to equity. Accordingly, for the purpose of the unaudited pro forma
financial information, the unaudited pro forma adjusted consolidated net tangible assets attributable to the equity
holders of the Company as at 30 June 2025 will be increased by RMB1,962,541,000, being the carrying amount of
the financial instruments with preferred rights at amortized cost as at 30 June 2025.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-2 –


--- page 666 ---
4. The unaudited pro forma adjusted consolidated net tangible assets of the Group attributable to the equity holders of
the Company per Share is arrived at after the adjustments referred to in the preceding paragraphs and on the basis
that 43,789,310 Shares were in issue assuming the Global Offering had taken place on 30 June 2025, without taking
into account of any Shares which may be allotted pursuant to the exercise of the Over-allotment Option or any
shares which may be issued by the Company pursuant to the general mandates. The amount of unaudited pro forma
adjusted consolidated net tangible assets of the Company attributable to the equity holders of the Company per
Share are converted from Hong Kong dollars to Renminbi based on the exchange rate as detailed in note 5 below.
5. For the purpose of this unaudited pro forma statement of adjusted consolidated net tangible assets, the amounts
stated in Renminbi are converted into Hong Kong dollars or Hong Kong dollars are converted to Renminbi at a rate
of RMB0.9088 to HK$1.00, as set out in the section headed “Information about this Prospectus and the Global
Offering” in this prospectus. No representation is made that Renminbi amounts have been, could have been or may
be converted to Hong Kong dollars, or vice versa, at that rate.
6. No adjustment has been made to reflect any trading results or other transactions of the Group entered into
subsequent to 30 June 2025.
7. The property interests at Changsha Intelligence Driving Institute Industrial Park, No. 60 Hebaotang West Road,
Yuelu District, Changsha City, Hunan Province, the PRC as at 30 September 2025, have been valued by Avista
Valuation Advisory Limited, an independent property valuer, and the relevant property valuation report is set out in
“Appendix III — Valuation Report”. The above unaudited pro forma adjusted consolidated net tangible assets of the
Group attributable to the equity holders of the Company as at 30 June 2025 do not take into account the surplus
arising from the revaluation of the property interests at Changsha Intelligence Driving Institute Industrial Park, No.
60 Hebaotang West Road, Yuelu District, Changsha City, Hunan Province, the PRC amounting to approximately
HK$1.5 million. Revaluation surplus has not been recorded in the Historical Financial Information as set out in
Appendix I — Accountants Report” as such property which is intended to be used as the office building and
production plant is included as “Buildings” of property, plant and equipment and “Leasehold land” of right-of-use
assets and is stated at cost less impairment loss, if any, at 30 June 2025. The directors considered no impairment is
necessary based on the value-in-use calculation and no additional depreciation would be charged against the
statement given the current condition of the property.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-3 –


--- page 667 ---
The following is the text of a report received from BDO Limited, Certified Public
Accountants, Hong Kong, for the purpose of incorporation in this prospectus.
INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE
COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION
TO THE DIRECTORS OF CIDI INC.
We have completed our assurance engagement to report on the compilation of unaudited pro
forma financial information of CiDi Inc. (the “ Company ”) and its subsidiaries (together, the
“Group ”) by the directors of the Company for illustrative purposes only. The unaudited pro forma
financial information consists of the unaudited pro forma statement of adjusted consolidated net
tangible assets of the Group as at 30 June 2025 and related notes as set out on pages II-1 to II-3 of
Appendix II of the Company’s prospectus dated 11 December 2025 (the “ Prospectus ”) in
connection with the proposed initial public offering of the shares of the Company (the “ Proposed
Public Offer ”). The applicable criteria on the basis of which the directors of the Company have
compiled the unaudited pro forma financial information are described on II-1 to II-3 of Appendix
II of the Prospectus.
The unaudited pro forma financial information has been compiled by the directors of the
Company to illustrate the impact of the Proposed Public Offer on the Group’s consolidated
financial position as at 30 June 2025 as if the Proposed Public Offer had taken place at 30 June
2025. As part of this process, information about the Group’s consolidated financial position has
been extracted by the directors of the Company from the Group’s historical financial information
for the years ended 31 December 2022, 2023, 2024 and six months ended 30 June 2025 on which
an accountants’ report set out in Appendix I of the Prospectus has been published.
Directors’ Responsibility for the Unaudited Pro Forma Financial Information
The directors of the Company 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 7 “Preparation of Pro Forma Financial Information for Inclusion in
Investment Circulars” (“ AG 7 ”) issued by the Hong Kong Institute of Certified Public Accountants
(“HKICPA ”).
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-4 –


--- page 668 ---
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” issued by the HKICPA, which requires the firm to design, implement and
operate a system of quality management including policies or procedures regarding compliance
with ethical requirements, professional standards and applicable legal and regulatory requirements.
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 of the Company have compiled the unaudited pro forma financial information in
accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the
HKICPA.
For purposes of this engagement, we are not responsible for updating or reissuing any reports
or opinions on any historical financial information used in compiling the unaudited pro forma
financial information, nor have we, in the course of this engagement, performed an audit or review
of the financial information used in compiling the unaudited pro forma financial information.
The purpose of unaudited pro forma financial information included in a prospectus is solely
to illustrate the impact of a significant event or transaction on unadjusted financial information of
the entity as if the event had occurred or the transaction had been undertaken at an earlier date
selected for purposes of the illustration. Accordingly, we do not provide any assurance that the
actual outcome of the Proposed Public Offer at 30 June 2025 would have been as presented.
A reasonable assurance engagement to report on whether the unaudited pro forma financial
information has been properly compiled on the basis of the applicable criteria involves performing
procedures to assess whether the applicable criteria used by the directors in the compilation of the
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-5 –


--- page 669 ---
unaudited pro forma financial information provide a reasonable basis for presenting the significant
effects directly attributable to the event or transaction, and to obtain sufficient appropriate
evidence about whether:
 the related unaudited pro forma adjustments give appropriate effect to those criteria; and
 the unaudited pro forma financial information reflects the proper application of those
adjustments to the unadjusted financial information.
The procedures selected depend on the reporting accountants’ judgment, having regard to the
reporting accountants’ understanding of the nature of the entity, the event or transaction in respect
of which the unaudited pro forma financial information has been compiled, and other relevant
engagement circumstances.
The engagement also involves evaluating the overall presentation of the unaudited pro forma
financial information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Opinion
In our opinion:
(a) the unaudited pro forma financial information has been properly compiled by the
directors of the Company on the basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purposes of the unaudited pro forma financial
information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.
BDO Limited
Certified Public Accountants
Lam Tsz Ka
Practising Certificate no. P06838
Hong Kong
11 December 2025
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-6 –


--- page 670 ---
The following is the text of a letter and a valuation certificate prepared for the purpose of
incorporation in this prospectus received from AVISTA V aluation Advisory Limited, an independent
valuer , in connection with its valuation as at 30 September 2025 of the property interests held by
the Company.
4VJUFT
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:  +852 3702 7338                         :  +852 3914 6388
11 December 2025
The Board of Directors
CiDi Inc. (ʮ̡ )
Building A3 and A4
Hunan Inspection and Testing Characteristic Industrial Park
No. 336 Xueshi Road, Yuelu District, Changsha City
Hunan Province, the PRC
Dear Sirs/Madams,
INSTRUCTIONS
In accordance with the instructions of CiDi Inc. (ʮ̡ ) (the
“Company ”) and its subsidiaries (hereinafter together referred to as the “ Group ”) for us to carry
out the valuation of the property interests (the “ Property ”) located in the People’s Republic of
China (the “ PRC”) held by the Group, we confirm that we have carried out inspection, made
relevant enquiries and searches and obtained such further information as we consider necessary for
the purpose of providing you with our opinion of the market value of the Property as at 30
September 2025 (the “ Valuation Date ”).
BASIS OF V ALUATION AND V ALUATION STANDARDS
Our valuation is carried out on a market value basis, which is defined by the Royal
Institution of Chartered Surveyors as “ the estimated amount for which an asset or liability should
exchange on the valuation date between a willing buyer and a willing seller in an arm’ s length
transaction, after proper marketing and where the parties had each acted knowledgeably,
prudently and without compulsion ”.
APPENDIX III V ALUATION REPORT
– III-1 –


--- page 671 ---
In valuing the Property, we have complied with all the requirements set out in Chapter 5 and
Practice Note 12 of the Rules Governing the Listing of Securities issued by The Stock Exchange
of Hong Kong Limited (the “ Listing Rules ”), the RICS Valuation — Global Standards 2024
published by the Royal Institution of Chartered Surveyors (“ RICS”) and the International
Valuation Standards published from time to time by the International Valuation Standards Council.
V ALUATION ASSUMPTIONS
Our valuation of the Property excludes an estimated price inflated or deflated by special
terms or circumstances such as atypical financing, sale and leaseback arrangement, special
considerations or concessions granted by anyone associated with the sale, or any element of
special value or costs of sale and purchase or offset for any associated taxes.
No allowance has been made in our report for any charges, mortgages or amounts owing on
any of the Property valued nor for any expenses or taxation which may be incurred in effecting a
sale. Unless otherwise stated, it is assumed that the Property is free from encumbrances,
restrictions and outgoings of an onerous nature, which could affect their values.
In the course of our valuation of the Property in the PRC, we have relied on the advice given
by the Group and its legal advisor, being Zhong Lun Law Firm (ࡐ( ଉέ)ה)
the “ PRC Legal Advisor ”), regarding the titles to the Property.
In valuing the Property, we have relied on a legal opinion regarding the Property provided by
the PRC Legal Adviser dated 11 December 2025 (the “ PRC Legal Opinion ”). Unless otherwise
stated, the Group has legally obtained the land use rights of the Property.
No environmental impact study has been ordered or made. Full compliance with applicable
national, provincial and local environmental regulations and laws is assumed.
V ALUATION METHODOLOGY
In valuing the Property, due to the nature of the buildings and structures of the subject
property, there are no market sales comparables readily available. We have valued the property
interests on the basis of their depreciated replacement cost. Depreciated replacement cost is
defined as “ the current cost of replacing an asset with its modern equivalent asset less deduction
for physical deterioration and all relevant forms of obsolescence and optimization ”. It is based on
an estimation of the market value for the existing use of the land, plus the current cost of
replacement (reproduction) of the building, including the improvements, less deductions for
physical deterioration and all relevant forms of obsolescence and optimization.
APPENDIX III V ALUATION REPORT
– III-2 –


--- page 672 ---
We have assigned no commercial value to the property interests for which the Group has not
possessed either the land titleship or the building ownership documents.
TITLE INVESTIGATION
We have been provided with copies of documents in relation to the title of the Property in the
PRC. Where possible, we have examined the original documents to verify the existing title to the
Property in the PRC and any material encumbrance that might be attached to the Property or any
tenancy amendment. All documents have been used for reference only and all dimensions,
measurements and areas are approximate. In the course of our valuation, we have relied
considerably on the PRC Legal Opinion given by the PRC Legal Adviser, concerning the validity
of the title of the Property in the PRC.
SITE INVESTIGATION
We have inspected the exteriors and, where possible, the interior of the subject property. The
site inspection was carried out on 10 September 2024 by Turman Cheung (Assistant Manager). He
has more than 5 years’ experience in valuation of properties in the PRC.
In the course of our inspection, we did not note any serious defects. However, we have not
carried out an investigation on site to determine the suitability of ground conditions and services
for any development thereon, nor have we conducted structural surveys to ascertain whether the
subject property is free of rot, infestation, or any other structural defects. Additionally, no tests
have been carried out on any of the utility services. Our valuation has been prepared on the
assumption that these aspects are satisfactory. We have further assumed that there is no significant
pollution or contamination in the locality which may affect any future developments.
SOURCE OF INFORMATION
Unless otherwise stated, we shall rely to a considerable extent on the information provided to
us by the Group or the PRC Legal Adviser or other professional advisers on such matters as
statutory notices, planning approvals, zoning, easements, tenures, completion date of buildings,
development proposal, identification of the property, particulars of occupation, site areas, floor
areas, matters relating to tenure, tenancies and all other relevant matters.
We have had no reason to doubt the truth and accuracy of the information provided to us by
the Group. We have also sought confirmation from the Group that no material factors have been
omitted from the information supplied. We consider that we have been provided with sufficient
information to reach an informed view and we have no reason to suspect that any material
information has been withheld.
APPENDIX III V ALUATION REPORT
– III-3 –


--- page 673 ---
We have not carried out detailed measurements to verify the correctness of the areas in
respect of the property but have assumed that the areas shown on the title documents and official
site plans handed to us are correct. All documents and contracts have been used as reference only
and all dimensions, measurements and areas are approximations. No on-site measurement has been
taken.
LIMITING CONDITION
Wherever the content of this report is extracted and translated from the relevant documents
supplied in Chinese context and there are discrepancies in wordings, those parts of the original
documents will take prevalent.
CURRENCY
Unless otherwise stated, all monetary amounts stated in this report are in Renminbi (RMB).
Our valuation certificate is attached below.
Yours faithfully,
For and on behalf of
A VISTA Valuation Advisory Limited
Vincent C B Pang
MRICS CF A FCP A FCP A Australia
RICS Registered V aluer
Managing Partner
Note:
Mr. Vincent C B Pang is a member of Royal Institution of Chartered Surveyors (RICS) and a registered valuer of RICS.
He has over 10 years’ experience in valuation of properties including Hong Kong, the PRC, the U.S., and East and
Southeast Asia.
APPENDIX III V ALUATION REPORT
– III-4 –


--- page 674 ---
V ALUATION CERTIFICATE
Property interests held for owner occupation by the Company in the PRC
Property Description and tenure
Particulars of
occupancy
Market value in
existing state as at
30 September 2025
RMB
Changsha
Intelligence
Driving Institute
Industrial Park,
No. 60 Hebaotang
West Road, Yuelu
District,
Changsha City,
Hunan Province,
the PRC
(Ӎ
ᘇਜஃ̍෨
Г༩60Ӎ౽
Ӻ෤ପ
ุ෤)
The property comprises two 2- and 13-storey
industrial buildings over two 1- and 2-storey
basement, with a total gross floor area of
approximately 60,140.03 sq.m.
The property was held for owner occupation
as at the Valuation Date.
As advised by the Group, the property was
completed in August 2023.
The classification, usage and area details are
set out in Note 4.
The property is located at Hebaotang West
Road in Yuelu District, with approximately
26.0 km to Changsha South Railway Station
and 49.7 km to Changsha Huanghua
International Airport.
The land use rights of the property have
been granted for a term expiring on 1
August 2069 for industrial use.
The property was
occupied by the
Group as at the
Valuation Date for
manufacturing
purpose.
241,600,000
(67% interest
attributable to
the Company:
161,870,000)
APPENDIX III V ALUATION REPORT
– III-5 –


--- page 675 ---
Notes:
1. Pursuant to 9 Real Estate Ownership Certificates issued by Hunan Xiangjiang New Area Management Committee
Bureau of Natural Resources and Planning (ึІ್༟๕ձ஝ྌ҅ ), the land use rights and
building ownership of the property have been vested in Changsha CiDi Intelligent Construction Co., Ltd. (ࠔ
ப΂ʮ̡ ,“ Changsha CiDi Construction ”), in which the Company holds a direct ownership stake of
67%, with the details as follows:
No. Certificate No. Land Usage
Building
Usage Expiry Date Site Area
Gross
Floor Area
(sq.m.) (sq.m.)
1 Xiang (2023) Chang Sha Shi Bu
Dong Chan Quan Di No.
0360291 ................
Industrial Industrial 1 August 2069 53,395.62 24,404.39
2 Xiang (2023) Chang Sha Shi Bu
Dong Chan Quan Di No.
0360285 ................
Industrial Industrial 1 August 2069 53,395.62 10,404.65
3 Xiang (2023) Chang Sha Shi Bu
Dong Chan Quan Di No.
0360289 ................
Industrial Utility
Facility
1 August 2069 53,395.62 71.22
4 Xiang (2023) Chang Sha Shi Bu
Dong Chan Quan Di No.
0360297 ................
Industrial Utility
Facility
1 August 2069 53,395.62 221.78
5 Xiang (2023) Chang Sha Shi Bu
Dong Chan Quan Di No.
0360287 ................
Industrial Utility
Facility
1 August 2069 53,395.62 75.65
6 Xiang (2023) Chang Sha Shi Bu
Dong Chan Quan Di No.
0360298 ................
Industrial Utility
Facility
1 August 2069 53,395.62 19.89
7 Xiang (2023) Chang Sha Shi Bu
Dong Chan Quan Di No.
0360292 ................
Industrial Utility
Facility
1 August 2069 53,395.62 21.55
8 Xiang (2023) Chang Sha Shi Bu
Dong Chan Quan Di No.
0360294 ................
Industrial Utility
Facility
1 August 2069 53,395.62 41.17
9 Xiang (2023) Chang Sha Shi Bu
Dong Chan Quan Di No.
0360852 ................
Industrial Carpark 1 August 2069 53,395.62 10,903.92
Total: 46,164.22
2. As advised by the Group, the title certificates of building ownership of portions of the property with a total gross
floor area of approximately 13,975.81 sq.m. (the “ Basement (Zone B) ”) has not been obtained.
APPENDIX III V ALUATION REPORT
– III-6 –


--- page 676 ---
3. In undertaking our valuation, we have assigned no commercial value to the property since Changsha CiDi
Construction has yet to obtain proper title certificates of the Basement (Zone B) For reference purposes, we are of
the opinion that the estimated value of the Basement (Zone B) as at the Valuation Date would be RMB73,470,000,
assuming the Basement (Zone B) could be freely transferred in the market.
4. As advised by the Group, the details of the property are set out as below:
Classification Usage Gross Floor Area
(sq.m.)
Property interests held for owner occupation by the Company
in the PRC ................................
Industrial 34,809.04
Utility Facility 451.26
Carpark 24,879.73
Total: 60,140.03
5. We have been provided with the PRC Legal Opinion, which contains, inter alia, the following:
a. Changsha CiDi Construction has fully settled all land premium and legally and validly obtained the land use
rights of the property and the building ownership of portions of the property with a total gross floor area of
approximately 46,164.22 sq.m. under the terms of the Real Estate Ownership Certificate;
b. The building ownership of portions of the property with a total gross floor area of approximately 35,308.31
sq.m. has been pledged to Bank of Communications Co., Ltd. (Hunan Provincial Branch) (ࠢ
ʱБ );
c. The building ownership of portions of the property with a total gross floor area of approximately 10,404.65
sq.m. has been seized by Yuelu District People’s Court of Changsha Municipality (৫ );
d. The property has not been subjected to any other encumbrances; and
e. Changsha CiDi Construction has the right to freely occupy or use the land use rights of the property.
6. In the course of our valuation, we assume that the property is transferable without legal impediment.
7. Our valuation has been made on the following basis and analysis:
In our valuation of the land use rights, we have considered and analyzed 3 land sale comparables in the vicinity.
The adjusted site values of the land sales range from RMB700 to RMB750 per sq.m. for industrial use. The unit
rate adopted in the valuation is consistent with the unit rates of the relevant comparables after due adjustments in
terms of location, time and size, etc.
Regarding the building portion, the current replacement cost of the building is assessed by determining the
construction cost of a modern substitute building with the same service capacity as the building which is being
valued. The adjusted replacement costs range from RMB4,300 per sq.m. to RMB4,350 per sq.m. for industrial
buildings and from RMB5,380 per sq.m. to RMB5,670 per sq.m. for basements based on our research of the local
construction costs. The replacement cost adopted in the valuation is consistent with the findings of our research.
APPENDIX III V ALUATION REPORT
– III-7 –


--- page 677 ---
TAXATION OF SECURITY HOLDERS
The taxation of income and capital gains of holders of H Shares is subject to the laws and
practices of the PRC and of jurisdictions in which holders of H Shares reside or are otherwise
subject to tax. The following summary of certain relevant taxation provisions is based on laws and
practices in effect as of the Latest Practicable Date, and the foregoing laws and practices are
subject to change or adjustment, and may have retrospective effect, and therefore the following
summary of taxation provisions does not constitute any comments or suggestions. The discussion
does not cover all tax consequences that may be related to relevant investments in H Shares, nor
does it take the specific circumstances of any particular investor into account, some of which may
be subject to special provisions. Accordingly, you should consult your own tax advisor regarding
the tax consequences of an investment in H Shares.
No issues on PRC or Hong Kong taxation other than income tax, capital gain and profit tax,
business tax/V AT, stamp duty and estate duty were referred in the discussion. Prospective investors
are urged to consult their financial advisors regarding the PRC, Hong Kong and other tax
consequences of owning and disposing of H Shares.
The PRC Taxation
Taxation on Dividends
Individual Investors
Pursuant to the Individual Income Tax Law of the PRC (),
which was most recently amended and issued on August 31, 2018, and came into force on January
1, 2019 and the Implementation Provisions of the Individual Income Tax Law of the PRC ( ʕശ
ૢԷ), which was most recently amended and issued on December
18, 2018, and came into force on January 1, 2019 (hereinafter collectively referred to as the “ IIT
Law”), dividends distributed by PRC enterprises are subject to individual income tax levied at a
flat rate of 20%. For a foreign individual who is not a resident of the PRC, the receipt of dividends
from an enterprise in the PRC is normally subject to an individual income tax of 20% unless
specifically exempted by the tax authority of the State Council or reduced by relevant tax treaties.
Pursuant to the Arrangement between Mainland China and the Hong Kong Special
Administrative Region on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion
with Respect to Taxes on Income (ᅄ೼ձԣ˟ਊဍ
τર), which was signed by Mainland China and the Hong Kong Special Administrative
Region on August 21, 2006 and came into effect on December 8, 2006, the Chinese Government
may levy taxes on the dividends paid by a Chinese company to Hong Kong residents (including
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 1–


--- page 678 ---
natural persons and legal entities) in an amount not exceeding 10% of the total dividends payable
by the Chinese company unless a Hong Kong resident directly holds 25% or more of the equity in
a Chinese company, then such tax shall not exceed 5% of the total dividends payable by the
Chinese company.
The Fifth Protocol of the Arrangement between Mainland China and the Hong Kong Special
Administrative Region on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion
with Respect to Taxes on Income ( <ᅄ೼ձԣ˟ਊဍ
τર>), which came into effect on December 6, 2019, states that such provisions
shall not apply to arrangements or transactions made for the primary purpose of gaining such tax
benefit.
In addition, the application of the dividend clause of tax agreements shall be subject to
provisions of the PRC tax laws and regulations, such as the guidelines specified in the Notice of
the State Taxation Administration on the Issues Concerning the Application of the Dividend
Clauses of Tax Agreements (Guo Shui Han [2009] No. 81) (ٰ֛
 (਷೼Ռ[2009]81 ໮)), which came into force on February 20, 2009.
While determining the taxation applicable to dividends under the Arrangement, the investors shall
comply with these regulations.
Enterprise Investors
In accordance with the Enterprise Income Tax Law of the PRC (੻
) promulgated by the National People’s Congress (“ NPC”) on March 16, 2007, effective as
at January 1, 2008 and amended on February 24, 2017, and December 29, 2018, and the
Implementation Provisions of the Enterprise Income Tax Law of the PRC ( ʕശɛ͏΍ձ਷Άุ
ૢԷ) promulgated by the State Council on December 6, 2007, effective as at
January 1, 2008 and amended in 2019 (hereinafter collectively referred to as the “ EIT Law ”), a
non-resident enterprise is generally subject to a 10% enterprise income tax on PRC-sourced
income (including dividends received from a PRC resident enterprise), if such non-resident
enterprise does not have an establishment or place in the PRC or has an establishment or place in
the PRC but the PRC-sourced income is not directly connected with such establishment or place.
Such withholding tax for non-resident enterprises is deducted at source, where the payer of the
income is required to withhold the income tax from the amount to be paid to the non-resident
enterprise. The withholding tax may be reduced or exempted pursuant to applicable treaties for the
avoidance of double taxation.
The Circular on Issues Relating to the Withholding of Enterprise Income Tax by PRC
Resident Enterprises on Dividends Paid to Overseas Non-PRC Resident Enterprise Shareholders of
H Shares (Guo Shui Han [2008] No. 897) (͏ΆุΣྤ̮ H͏Ά
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 2–


--- page 679 ---
 (਷೼Ռ[2008]897 ໮)) which was issued
and implemented by the State Taxation Administration on November 6, 2008, further clarified that
a PRC-resident enterprise must withhold enterprise income tax at a rate of 10% on dividends paid
to overseas non-PRC resident enterprise shareholders of H Shares with respect to the dividends of
2008 and onwards. In addition, the Response to Questions on Levying Enterprise Income Tax on
Dividends Derived by Non-resident Enterprise from Holding Stocks such as B-shares (Guo Shui
Han [2009] No. 394) (͏Άุ՟੻ Bٙ
ҭᔧ(਷೼Ռ[2009]394 ໮)) which was issued and implemented by the State Taxation
Administration on July 24, 2009, further provides that any PRC-resident enterprise that is listed on
overseas stock exchanges must withhold enterprise income tax at a rate of 10% on dividends of
2008 and onwards that it distributes to non-resident enterprise shareholders. Such tax rates may be
further modified pursuant to the tax treaty that China has concluded with a relevant jurisdiction.
Pursuant to the Arrangement between Mainland China and the Hong Kong Special
Administrative Region on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion
with Respect to Taxes on Income (ᅄ೼ձԣ˟ਊဍ
τર), which was signed by Mainland China and the Hong Kong Special Administrative
Region on August 21, 2006 and came into effect on December 8, 2006, the Chinese Government
may levy taxes on the dividends paid by a Chinese company to Hong Kong residents (including
natural persons and legal entities) in an amount not exceeding 10% of the total dividends payable
by the Chinese company unless a Hong Kong resident directly holds 25% or more of the equity in
a Chinese company, then such tax shall not exceed 5% of the total dividends payable by the
Chinese company.
The Fifth Protocol of the Arrangement between Mainland China and the Hong Kong Special
Administrative Region on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion
with Respect to Taxes on Income ( <ᅄ೼ձԣ˟ਊဍ
τર>), which came into effect on December 6, 2019, states that such provisions
shall not apply to arrangements or transactions made for the primary purpose of gaining such tax
benefit.
In addition, the application of the dividend clause of tax agreements shall be subject to
provisions of the PRC tax laws and regulations, such as the guidelines specified in the Notice of
the State Taxation Administration on the Issues Concerning the Application of the Dividend
Clauses of Tax Agreements (Guo Shui Han [2009] No. 81) (ٰ֛
 (਷೼Ռ[2009]81 ໮)), which came into force on February 20, 2009.
While determining the taxation applicable to dividends under the Arrangement, the investors shall
comply with these regulations.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 3–


--- page 680 ---
Tax Treaties
Non-PRC resident investors residing in countries or jurisdictions which have entered into
treaties for the avoidance of double taxation with the PRC might be entitled to a reduction or
exemption of the enterprise income tax imposed on the dividends received from PRC companies.
The PRC currently has entered into Avoidance of Double Taxation Treaties or Arrangements with a
number of countries and regions including the Hong Kong Special Administrative Region, Macau
Special Administrative Region, Australia, Canada, France, Germany, Japan, Malaysia, the
Netherlands, Singapore, the United Kingdom and the United States.
Non-PRC resident enterprises entitled to preferential tax rates in accordance with the relevant
income tax treaties or arrangements are required to apply to the Chinese tax authorities for a
refund of the enterprise income tax in excess of the agreed tax rate, and the refund application is
subject to approval from the Chinese tax authorities.
Taxation on Share Transfer
VAT and Local Additional Tax
According to the Circular on the Pilot Program for Overall Implementation of the Collection
of V AT Instead of Business Tax (Cai Shui [2016] No.36) (೼༊ᓃ
(ৌ೼[2016]36 ໮)) (“ Circular 36 ”), which came into force on May 1, 2016, and was
amended on July 11, 2017, December 25, 2017 and March 20, 2019, entities and individuals
engaged in service sales in the PRC are subject to V AT and “engaged in service sales in the PRC”
means that the service providers or service users of transactions are located in the PRC.
In addition, Circular 36 also stipulates that transfer of financial products, including transfer
of the ownership of marketable securities, shall be subject to V AT at 6% on the taxable revenue.
For this purpose, taxable revenue is the balance of the sales price upon the deduction of the
purchase price. This liability of V AT applies to general and foreign V AT taxpayers. It is noted that,
individuals who transfer financial products are exempt from V AT, which is also stipulated in the
Notice of the Ministry of Finance and the State Taxation Administration on Several Policies
concerning the Exemption of Business Tax on Transactions of Individual Financial Commodities
and Other Transactions (ٙ
) effective on January 1, 2009.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 4–


--- page 681 ---
According to these regulations, if the holder is a non-resident individual, the PRC V AT is
exempted from the sale or disposal of H shares; however, if the holder is a non-resident enterprise
and the H-share buyer is an individual or entity located outside China, the holder is not necessarily
required to pay the PRC V AT, but if the H-share buyer is an individual or entity located in China,
the holder may be required to pay the PRC V AT.
However, given that there are no explicit regulations, it is still uncertain whether non-Chinese
resident enterprises are required to pay the PRC V AT for the disposal of H shares in practice.
At the same time, V AT payers are also required to pay urban maintenance and construction
tax, education surtax and local education surcharge, which shall usually be subject to 12% of the
V AT payable (if any).
Income tax
Individual Investors
According to the IIT Law, as for individuals, gains on the transfer of equity interests in the
PRC resident enterprises are subject to individual income tax at a rate of 20%. However, pursuant
to the Circular on Declaring that Individual Income Tax Continues to be Exempted over Income of
Individuals from Transfer of Shares (Cai Shui Zi [1998] No. 61)) (ࡈ׵
 (ৌ೼ο[1998]61 ໮)) issued jointly by the
Ministry of Finance and the State Taxation Administration on March 30, 1998, from January 1,
1997, income of individuals from transfer of the shares of listed enterprises is exempted from
individual income tax.
However, on December 31, 2009, the Ministry of Finance, the State Taxation Administration
and the CSRC jointly issued the Circular on Related Issues on Levying Individual Income Tax
over the Income Received by Individuals from the Transfer of Listed Shares Subject to Sales
Limitation (Cai Shui [2009] No. 167) (੻೼Ϟᗫ
 (ৌ೼[2009]167 ໮)). This circular came into effect on January 1, 2010, which states
that individuals’ income from the transfer of listed shares obtained from the public offering of
listed companies and transfer market on the Shanghai Stock Exchange and the Shenzhen Stock
Exchange shall continue to be exempted from individual income tax, except for the relevant shares
which are subject to sales restriction (as defined in the Supplementary Notice on Issues
Concerning the Levy of Individual Income Tax on Individuals’ Income from the Transfer of
Restricted Stocks of Listed Companies (Cai Shui [2010] No. 70) (ٰ
 (ৌ೼[2010]70 ໮)), which was jointly issued by the
above-mentioned three departments on November 10, 2010 and came into force on the same day).
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 5–


--- page 682 ---
As of the Latest Practicable Date, no aforesaid provisions have expressly provided that
individual income tax shall be levied from non-Chinese resident individuals on the transfer of
shares in PRC resident enterprises listed on overseas stock exchanges.
Enterprise Investors
In accordance with the EIT Law and its Implementation Rules, a non-resident enterprise is
generally subject to enterprise income tax at the rate of 10% on PRC-sourced income, including
gains derived from the disposal of equity interests in a PRC resident enterprise. However, this tax
only applies to the non-resident enterprise that does not have an establishment or premise in the
PRC or has an establishment or premise in the PRC but its PRC-sourced income has no real
connection with such establishment or premise. Such income tax payable by non-resident
enterprises is deducted at source, where the payer should be the withholding agent, and the income
tax amount is required to be withheld from the amount to be paid by the withholding agent when
every such payment is made or due. It is noted that, such tax may be reduced or exempted
pursuant to applicable tax treaties or agreements on avoidance of double taxation.
Stamp Duty
Pursuant to the Stamp Duty Law of the PRC (), which was
issued by the SCNPC on June 10, 2021 and came into effect on July 1, 2022, PRC stamp duty only
applies to all kinds of documents having legally binding force in the PRC and protected under the
PRC laws, thus PRC stamp duty shall not apply to the acquisition or disposal of H Shares outside
China.
Estate duty
No estate duty has been levied in the PRC under the current PRC laws.
Enterprise Income Tax
According to the EIT Law, the enterprise income tax rate in the PRC is 25% and is in line
with the rate applicable to foreign-invested enterprises and foreign enterprises.
Pursuant to the Administrative Measures for Accreditation of High and New Technology
Enterprises (, which was promulgated by the Ministry of Science
and Technology, the Ministry of Finance, the State Taxation Administration on April 14, 2008 and
amended on January 29, 2016, and became effective on January 1, 2016, enterprises qualified as
“High and New Technology enterprise” are entitled to apply for a preferential enterprise income
tax rate of 15% in accordance with the relevant provisions of the EIT Law. According to the
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 6–


--- page 683 ---
Notice Regarding the Promotion of the Income Tax Policy for Technologically Advanced Service
Enterprises to the Whole Countryஷ
, which was promulgated by the Ministry of Finance, the State Taxation Administration, the
Ministry of Commerce, the Ministry of Science and Technology, and the National Development
and Reform Commission on November 2, 2017 and went into effect on January 1, 2018, the
relevant preferential policies on enterprise income tax stipulated have been effective since January
1, 2017), and recognized technologically advanced service enterprises are entitled to a reduced rate
of 15% for the enterprise income tax nationwide. The education expenditures of employees in
recognized technologically advanced service enterprises that do not exceed 8% of the total wages
and salaries can be deducted from the taxable income. The excess is allowed to be carried forward
for deduction in subsequent tax years.
VAT
Before August 2013 and pursuant to applicable Mainland China tax regulations, any entity or
individual conducting business in the service industry is generally required to pay a business tax at
the rate of 5% on the revenue generated from providing services. However, if the services
provided are related to technology development and transfer, the business tax may be exempted
upon approval from the relevant tax authorities.
In November 2011, the Ministry of Finance and the State Taxation Administration
promulgated the Pilot Plan for Imposition of V AT to Replace Business Tax (೼༊
). In May and December 2013, April 2014, March 2016 and July 2017, the Ministry of
Finance and the State Taxation Administration promulgated five circulars to further expand the
scope of services that are to be subject to V AT instead of business tax. Pursuant to these tax rules,
from August 1, 2013, a V AT was imposed to replace the business tax in certain service industries,
including technology services and advertising services, and from May 1, 2016, V AT replaced
business tax in all industries, on a nationwide basis. On November 19, 2017, the State Council
further amended the Interim Regulation of the People’s Republic of China on V AT ( ʕശɛ͏΍
೼ᅲБૢԷ) to reflect the normalization of the pilot program. The V AT rates generally
applicable are simplified as 17%, 11%, 6% and 0%, and the V AT rate applicable to the small-scale
taxpayers is 3%. Unlike business tax, a taxpayer is allowed to offset the qualified input V AT paid
on taxable purchases against the output V AT chargeable on the revenue from services provided.
According to the Notice on Adjustment of V AT Rates (Cai Shui [2018] No. 32) (ሜ዆ᄣ
 (ৌ೼[2018]32 ໮)), which was issued by the Ministry of Finance and the State
Taxation Administration on April 4, 2018 and came into effect on May 1, 2018, for V AT payers’
sales activities or import of goods that are subject to V AT at an existing applicable rate of 17% and
11%, the applicable V AT rate is adjusted to 16% and 10%, respectively.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 7–


--- page 684 ---
According to the Announcement on Policies for Deepening the V AT Reform (࠽
ʮѓ), which was promulgated by the Ministry of Finance, the State Taxation
Administration and the General Administration of Customs on March 20, 2019, and came into
effect on April 1, 2019, for V AT payers’ sales activities or import of goods that are subject to V AT
at an existing applicable rate of 16% and 10%, the applicable V AT rate is adjusted to 13% and 9%,
respectively.
Hong Kong Taxation
Tax on dividends
Under the current practice of the Inland Revenue Department of Hong Kong, no tax is
payable in Hong Kong in respect of dividends paid by us.
Capital gains tax and profits tax
No tax is imposed in Hong Kong in respect of capital gains from the sale of H Shares.
However, trading gains from the sale of the H Shares by persons carrying on a trade, professional
services or business in Hong Kong, where such gains are derived from or arise from such trade,
professional services or business in Hong Kong will be subject to Hong Kong profits tax, which is
currently imposed at the maximum rate of 16.5% on corporations and at the maximum rate of 15%
on unincorporated businesses. Gains of certain categories of taxpayers (for example, financial
institutions, insurance companies and securities dealers) are likely to be regarded as trading gains
rather than capital gains unless these taxpayers can prove that the investment securities are held as
long-term investments. Trading gains from sales of H Shares effected on the Hong Kong Stock
Exchange will be considered to be derived from or arising in Hong Kong. Hong Kong profits tax
shall be paid in respect of trading gains from sales of H Shares effected on the Stock Exchange
realized by persons carrying on a business of trading or dealing in securities in Hong Kong.
Stamp Duty
Hong Kong stamp duty, currently charged at the ad valorem rate of 0.1% on the higher of the
consideration for or the market value of each Hong Kong security (including H Shares), will be
payable by the purchaser on every purchase and by the seller on every sale of Hong Kong
securities, including H Shares. (in other words, a total of 0.2% is currently levied on a typical sale
and purchase transaction involving H Shares). In addition, a fixed stamp duty of HK$5.00 is
currently payable on any instrument of transfer of H Shares. Where one of the parties to trading is
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 8–


--- page 685 ---
a resident outside Hong Kong and does not pay the ad valorem duty, the duty not paid will be
assessed on the instrument of transfer (if any) and will be payable by the transferee. If no stamp
duty is paid on or before the due date, a penalty of up to ten times the duty payable may be
imposed.
Estate duty
The Revenue (Abolition of Estate Duty) Ordinance 2005 ( 2005 ϋϗɝ(՟ऊ፲ପ೼ )ૢԷ)
came into effect on February 11, 2006 in Hong Kong, pursuant to which, no Hong Kong estate
duty is payable and no estate duty clearance papers are needed for an application of a grant of
representation in respect of holders of H Shares whose deaths occur on or after February 11, 2006.
FOREIGN EXCHANGE MANAGEMENT IN THE PRC
Renminbi (“ RMB”) is the lawful currency of the PRC, which is currently subject to foreign
exchange control and cannot be freely converted into foreign currency. The State Administration of
Foreign Exchange, with the authorization of the PBOC, is empowered with the functions of
administering all matters relating to foreign exchange, including the enforcement of foreign
exchange control regulations.
The Foreign Exchange Administration Regulations of the PRC ( ʕശɛ͏΍ձ਷̮ි၍ଣૢ
Է) (the “ Foreign Exchange Administration Regulations ”) which was issued by the State
Council on January 29, 1996 and came into force on April 1, 1996, classifies all international
payments and transfers into current accounts and capital accounts. Current accounts are subject to
the reasonable examination of the veracity of transaction documents and the consistency of the
transaction documents and the foreign exchange receipts and payments by financial institutions
engaging in conversion and sale of foreign currencies and supervision and inspection by the
foreign exchange control authorities. For capital accounts, overseas organizations and overseas
individuals making direct investments in China shall, upon approval by the relevant authorities in
charge, process registration formalities with the foreign exchange control authorities. Foreign
exchange income received overseas can be repatriated or deposited overseas, and foreign exchange
and foreign exchange settlement funds under the capital account are required to be used only for
purposes as approved by the competent authorities and foreign exchange administrative authorities.
In the event that international revenues and expenditure occur or may occur a material misbalance,
or the national economy encounters or may encounter a severe crisis, the State may adopt
necessary safeguard and control measures on international revenues and expenditure. The Foreign
Exchange Administration Regulations was amended on January 14, 1997 and August 5, 2008. The
latest amended Foreign Exchange Administration Regulations clearly explains that China will not
impose any restrictions on international payments and transfers under current accounts, while
capital accounts are still subject to relevant approvals.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 9–


--- page 686 ---
The Regulations for the Administration of Settlement, Sale and Payment of Foreign Exchange
(), which was promulgated by the PBOC on June 20, 1996 and
came into force on July 1, 1996, removes other restrictions on convertibility of foreign exchange
under current accounts, while retaining existing regulation on foreign exchange transactions under
capital accounts.
According to the Announcement of the PBOC on Improving the Reform of the Renminbi
Exchange Rate Formation Mechanism (PBOC announcement [2005] No. 16) (׵
ʮѓ (ʕ਷ɛ͏ვБʮѓ [2005] ୋ16໮)), which was issued by
the PBOC on July 21, 2005, the PRC has started to reform the exchange rate system and
implement a managed floating exchange rate system in which the exchange rate would be
determined based on market supply and demand and adjusted with reference to a basket of
currencies since July 21, 2005. Therefore, the Renminbi exchange rate was no longer pegged to the
U.S. dollar. PBOC would publish the closing price of the exchange rate of the Renminbi against
trading currencies such as the U.S. dollar in the interbank foreign exchange market after the
closing of the market on each working day, as the central parity of the currency against Renminbi
transactions on the following working day.
On August 5, 2008, the State Council promulgated the amended Foreign Exchange
Administration Regulations (the “ Amended Foreign Exchange Administration Regulations ”),
which has made significant changes to China’s foreign exchange regulatory system. Firstly, the
Amended Foreign Exchange Administration Regulations equalize the inflow and outflow of foreign
capital. Foreign currency income can be repatriated from overseas to China or deposited overseas,
while foreign currencies in the capital accounts and funds for foreign currency settlement can be
used only for purposes as approved by the relevant competent authorities and foreign exchange
administrative authorities. Secondly, the Amended Foreign Exchange Administration Regulations
improves the RMB exchange rate mechanism which is based on market supply and demand.
Thirdly, according to the Amended Foreign Exchange Administration Regulations, the monitoring
of cross-border capital flow of foreign currencies will be strengthened, and the State may adopt
necessary safeguard and control measures on international revenues and expenditure in the event
that cross-border trade revenues and expenditure occur or may occur a material misbalance, or the
national economy encounters or may encounter a severe crisis. Fourthly, the Amended Foreign
Exchange Administration Regulations strengthens the regulations and supervision of foreign
currency transactions and grant various authorities to the State Administration of Foreign
Exchange to enhance its supervisory and regulatory capabilities.
According to the relevant laws and regulations in the PRC, PRC enterprises (including
foreign investment enterprises) which need foreign exchange for current item transactions may,
without the approval of the foreign exchange administrative authorities, effect payment through
foreign exchange accounts opened at the designated foreign exchange bank, on the strength of
valid transaction receipts and proof. Foreign investment enterprises which need foreign exchange
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-10 –


--- page 687 ---
for the distribution of profits to their shareholders and PRC enterprises which, in accordance with
regulations, are required to pay dividends to their shareholders in foreign exchange (such as our
Company) may, on the strength of resolutions of the Board of Directors or the general meeting on
the distribution of profits, effect payment from foreign exchange accounts at the designated foreign
exchange bank, or effect exchange and payment at the designated foreign exchange bank.
According to the Decisions on Matters including Canceling and Adjusting a Batch of
Administrative Approval Items (Guo Fa [2014] No. 50) (ᄲҭධ
 (਷೯[2014]50 ໮)) which was promulgated by the State Council on October 23,
2014, it decided to cancel the approval requirement of the State Administration of Foreign
Exchange and its branches for the remittance and settlement of the proceeds raised from the
overseas listing of the foreign shares into RMB domestic accounts.
According to the Notice of the State Administration of Foreign Exchange on Relevant Issue
Concerning the Administration of Foreign Exchange for Overseas Listing (Hui Fa [2014] No. 54)
( (ි೯[2014]54 ໮)) issued by the State
Administration of Foreign Exchange and came into effect on December 26, 2014, a domestic
company shall, within 15 working days from the date of the end of its overseas listing issuance,
register the overseas listing with the local branch office of the State Administration of Foreign
Exchange at the place of its establishment; and the proceeds from an overseas listing of a domestic
company may be remitted to the domestic account or deposited in an overseas account, but the use
of the proceeds shall be consistent with the content of the document and other disclosure
documents.
According to the Notice of the State Administration of Foreign Exchange on Further
Simplifying and Improving Policies for the Foreign Exchange Administration of Direct Investment
(Hui Fa [2015] No. 13) (
(ි೯[2015]13 ໮)), which was issued by the State Administration of Foreign Exchange on
February 13, 2015 and came into effect on June 1, 2015, two administrative approval items, the
confirmation of foreign exchange registration under domestic direct investment and the
confirmation of foreign exchange registration under overseas direct investment, have been
cancelled, and foreign exchange registration under domestic and overseas direct investment shall
be directly examined and handled by banks. The State Administration of Foreign Exchange and its
branch offices shall indirectly regulate the foreign exchange registration of direct investment
through banks.
According to the Notice of the State Administration of Foreign Exchange on Reforming and
Standardizing the Foreign Exchange Settlement Management Policies of Capital Account (Hui Fa
[2016] No. 16) ( (ි೯[2016]16
໮)) which was promulgated by the State Administration of Foreign Exchange and came into effect
on June 9, 2016, foreign currency earnings in capital accounts that relevant policies of discretional
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
–I V - 1 1–


--- page 688 ---
settlement have been clearly implemented (including foreign exchange capital, foreign debt and
repatriated funds raised through overseas listing) may be settled at the banks according to actual
operational needs of the domestic institutions. The tentative percentage of foreign exchange
settlement for foreign currency earnings in capital account of domestic institutions is 100%,
subject to adjustment of the State Administration of Foreign Exchange in due time in accordance
with international revenue and expenditure situations.
On January 26, 2017, Notice of the State Administration of Foreign Exchange on Further
Promoting the Reform of Foreign Exchange Administration and Improving the Examination of
Authenticity and Compliance (Hui Fa [2017] No.3) (ආɓӉપආ̮ි၍ଣҷ
(ි೯[2017]3 ໮)) was issued by the State Administration of
Foreign Exchange to further expand the scope of settlement for domestic foreign exchange loans.
According to the notice, settlement for domestic foreign exchange loans with export background
under goods trading, repatriation of funds under domestic guaranteed foreign loans for domestic
utilization, and settlement for domestic foreign exchange accounts of foreign institutions operating
in the Free Trade Zone are allowed; the management model of full-coverage RMB and foreign
currency overseas lending is adopted; where a domestic institution engages in overseas lending,
the sum of its outstanding overseas lending in RMB and outstanding overseas lending in foreign
currencies shall not exceed 30% of its owner’s equity in the audited financial statements of the
preceding year.
On October 23, 2019, the State Administration of Foreign Exchange issued the Circular of the
State Administration of Foreign Exchange on Further Promoting the Facilitation of Cross-border
Trade and Investment (Hui Fa [2019] No. 28) (ک
(ි೯[2019]28 ໮)), which allows all foreign-invested enterprises to use Renminbi
converted from foreign currency-denominated capital for equity investments in China, as long as
the equity investment in China is genuine, does not violate applicable laws, and complies with the
negative list on foreign investment.
According to the Circular of the State Administration of Foreign Exchange on Optimizing
Foreign Exchange Administration to Support the Development of Foreign-related Business (࢕
 ) promulgated by the State
Administration of Foreign Exchange on April 10, 2020 and came into force on June 1, 2020, the
reform of facilitating the payments of incomes under the capital account shall be promoted
nationwide. Under the prerequisite of ensuring true and compliant use of funds and complying
with the prevailing administrative provisions on use of income in capital accounts, qualified
enterprises are allowed to use income in the capital account for domestic payment, such as capital
funds, foreign debt and proceeds from overseas listing, without the need to provide proof materials
for veracity to the bank beforehand for each transaction.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
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This appendix sets out a summary of certain aspects of the PRC laws and regulations relevant
to the operations and business of the Company. The PRC laws and regulations relating to taxation
are set out in “Appendix IV — Taxation and Foreign Exchange”. This appendix also contains a
summary of certain Hong Kong legal and regulatory provisions. For discussion of the laws and
regulations that specifically govern the business of the Company, please refer to “Regulatory
Overview”.
1. PRC LA WS AND REGULATIONS
The PRC Legal System
The PRC legal system is based on the Constitution of the PRC () (the
“Constitution ”) and is made up of written laws, administrative regulations, local regulations,
autonomous regulations, separate regulations, rules and regulations of State Council departments,
rules and regulations of local governments, laws of special administrative regions and international
treaties of which the PRC government is a signatory and other regulatory documents. Court
judgments do not constitute legally binding precedents, although they are used for the purposes of
judicial reference and guidance.
Pursuant to the Constitution and the Legislation Law of the PRC ()
(the “ Legislation Law ”), the NPC and SCNPC are empowered to exercise the legislative power of
the State. The NPC has the power to formulate and amend the basic laws governing criminal and
civil matters, State institutions and other matters. The SCNPC formulates and amends laws other
than those required to be enacted by the NPC and to supplement and amend parts of the laws
enacted by the NPC during the adjournment of the NPC, provided that such supplements and
amendments are not in conflict with the basic principles of such laws.
The State Council is the highest organ of state administration and has the power to formulate
administrative regulations based on the Constitution and laws. The people’s congresses of the
provinces, autonomous regions and municipalities and their standing committees may formulate
local regulations based on the specific circumstances and actual needs of their respective
administrative areas, provided that such local regulations do not contravene any provision of the
Constitution, laws or administrative regulations. The people’s congresses of cities with districts
and their respective standing committees may formulate local regulations with respect to urban and
rural construction and management, ecological civilization construction, historical and cultural
protection, grassroots governance and other aspects according to the specific circumstances and
actual needs of such cities, provided that such local regulations do not contravene any provision of
the Constitution, laws, administrative regulations and local regulations of their respective
provinces or autonomous regions. If the law provides otherwise on the matters concerning the
formulation of local regulations by cities with districts, such provisions shall prevail. Such local
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regulations of cities with districts will become enforceable after being reported to and approved by
the standing committees of the people’s congresses of the relevant provinces or autonomous
regions. The standing committees of the people’s congresses of the provinces or autonomous
regions shall examine the legality of local regulations submitted for approval, and such approval
should be granted within four months if they are not in conflict with the Constitution, laws,
administrative regulations and local regulations of such provinces or autonomous regions. Where,
during the examination for approval of local regulations of cities with districts by the standing
committees of the people’s congresses of the provinces or autonomous regions, conflicts are
identified with the rules and regulations of the people’s governments of the provinces or
autonomous regions concerned, a decision should be made by the standing committees of the
people’s congresses of provinces or autonomous regions to resolve the issue. People’s congresses
of national autonomous areas have the power to enact autonomous regulations and separate
regulations in light of the political, economic and cultural characteristics of the ethnic groups in
the areas concerned.
The ministries and commissions of the State Council, the PBOC, the National Audit Office,
institutions with administrative functions directly under the State Council, and institutions
stipulated by law may formulate rules and regulations within the granted power of their respective
departments based on the laws and the administrative regulations, decisions and rulings of the
State Council. Matters governed by the departmental rules and regulations should be those for the
enforcement of the laws and administrative regulations, decisions and rulings of the State Council.
The people’s governments of provinces, autonomous regions and municipalities and cities with
districts and autonomous regions may formulate rules and regulations, in accordance with laws,
administrative regulations and relevant local regulations of provinces, autonomous regions and
municipalities.
Pursuant to the Resolution of the SCNPC Providing an Improved Interpretation of the Law
(Ӕᙄ ) passed on June 10, 1981, issues
related to the further clarification or supplement of laws or decrees should be interpreted by the
SCNPC or provided by with decrees, issues related to the application of laws or decrees in a court
trial should be interpreted by the Supreme People’s Court, issues related to the application of laws
or decrees in a prosecution process should be interpreted by the Supreme People’s Procuratorate,
and the application of other laws and decrees in matters other than those involved in trial or
prosecution process should be interpreted by the State Council and the competent authorities. The
State Council and its ministries and commissions are also vested with the power to give
interpretations of the administrative regulations and departmental rules and regulations which they
have promulgated. At the regional level, the power to interpret regional laws and regulations is
vested in the regional legislative and administrative authorities which promulgate such laws and
regulations.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
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The PRC Judicial System
Under the Constitution, the Law of Organization of the People’s Courts of the PRC (2018
revision) (ج2018ࠈࡌ)) and the Law of Organization of the
People’s Procuratorate of the PRC (2018 revision) (ج2018ࡌ
ࠈ)), the people’s courts of the PRC are classified into the Supreme People’s Court, the local
people’s courts at various levels and other special people’s courts. The local people’s courts at
various levels are divided into three levels, namely, the primary people’s courts, the intermediate
people’s courts and the higher people’s courts. The primary people’s courts may set up a number
of people’s tribunals based on the facts of the region, population and cases. The Supreme People’s
Court is the highest judicial authority. The Supreme People’s Court shall supervise the judicial
work of the local people’s courts at all levels and special people’s courts, and people’s courts at
higher levels shall supervise the judicial work of people’s courts at lower levels. The Chinese
People’s Procuratorates are divided into the Supreme People’s Procuratorate, local people’s
procuratorates at various levels and specialized people’s procuratorates such as the Military
Procuratorate. The Supreme People’s Procuratorate is the highest procuratorial organ. The Supreme
People’s Procuratorate directs the work of the local people’s procuratorates and specialized
people’s procuratorates at all levels, and the people’s procuratorates at higher levels direct the
work of the people’s procuratorates at lower levels.
The people’s court takes the rule of the second instance as the final rule, that is, the
judgments or rulings of the second instance of the people’s court are final. The parties may appeal
against the judgment or ruling of the first instance of a local people’s court. The people’s
procuratorate may present a protest to the people’s court at the next higher level in accordance
with the procedures stipulated by the laws. In the absence of any appeal by the parties and any
protest by the people’s procuratorate within the stipulated period, the judgments or rulings of the
people’s court are final. Judgments or rulings of the second instance of the intermediate people’s
courts, the higher people’s courts and the Supreme People’s Court are final. The first judgments or
rulings of the Supreme People’s Court are also final. However, if the Supreme People’s Court or a
people’s court at the next higher level discovers an error in the final and binding judgment or
ruling which has taken effect in any people’s court at a lower level, or the presiding judge of a
people’s court discovers an error in a final and binding judgment which has taken effect in the
court over which he presides, a retrial of the case may be initiated according to the judicial
supervision procedures.
The Civil Procedure Law of the PRC () (the “ PRC Civil
Procedure Law ”) promulgated on April 9, 1991 and amended five times on October 28, 2007,
August 31, 2012, June 27, 2017, December 24, 2021 and September 1, 2023 prescribes the
conditions for instituting a civil action, the jurisdiction of the people’s courts, the procedures for
conducting a civil action, and the procedures for enforcement of a civil judgment or ruling. Each
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
–V - 3–


--- page 692 ---
party to a civil action conducted within the PRC must comply with the relevant provisions of the
PRC Civil Procedure Law. A civil case is generally heard by the court located in the defendant’s
place of domicile. The court of jurisdiction in respect of a civil action may also be chosen by
explicit agreement among the parties to a contract, provided that the people’s court having
jurisdiction should be located at places directly connected with the disputes, such as the plaintiff’s
or the defendant’s place of domicile, the places where the contract is executed or signed or the
place where the object of the action is located. Meanwhile, the above selection cannot violate the
stipulations of hierarchical jurisdiction and exclusive jurisdiction in any case.
A foreign individual, a person without nationality, a foreign enterprise and organization is
given the same litigation rights and obligations as a citizen, a legal person and other organization
of the PRC when initiating actions or defending against litigation at the people’s court. Should a
foreign court limit the civil litigation rights of citizens, a legal person, and other organizations of
the PRC, the PRC court may apply the same limitations to the civil litigation rights to citizens,
enterprises and organizations of such foreign country. A foreign individual, a person without
nationality, a foreign enterprise and organization must engage a PRC lawyer in case he or it needs
to engage a lawyer for the purpose of initiating actions or defending against litigations at the
people’s court. In accordance with the international treaties to which the PRC is a signatory or
participant or according to the principle of reciprocity, a people’s court and a foreign court may
request each other to serve documents, conduct investigation and collect evidence and conduct
other actions on its behalf. A people’s court shall not accommodate any request made by a foreign
court which will result in the violation of sovereignty, security or public interests of the PRC.
All parties to a civil action must perform the legally effective judgments and rulings. If any
party to a civil action refuses to abide by a judgement or ruling made by a people’s court or an
award made by an arbitration tribunal in the PRC, the other party may apply to the people’s court
for the enforcement of the same within two years subject to application for postponed enforcement
or revocation. If a party fails to satisfy within the stipulated period a judgement which the court
has granted an enforcement approval, the court may, upon the application of the other party,
mandatorily enforce the judgement on the party.
Where a party applies for enforcement of a legally effective judgement or ruling made by a
people’s court, and the opposite party or his property is not within the territory of the PRC, the
applicant may directly apply to a foreign court with jurisdiction for recognition and enforcement of
the judgement or ruling, or the people’s court may, in accordance with the provisions of
international treaties to which the PRC is a signatory or in which the PRC is a participant or the
principle of reciprocity, request recognition and enforcement by a foreign court. Similarly, where
an effective judgment or ruling made by a foreign court needs to be recognized and enforced by
the people’s court of the PRC, unless the people’s court considers that the recognition or
enforcement of the judgment or ruling would violate the basic legal principles of the PRC, national
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
–V - 4–


--- page 693 ---
sovereignty or national security or social and public interest, the parties involved may directly
apply to an intermediate people’s court of the PRC with jurisdiction for recognition and
enforcement, or the foreign court may, in accordance with the provisions of international treaties
entered into or acceded to by that country and the PRC or according to the principle of reciprocity,
request the people’s court to recognize and enforce it.
The Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic
Companies
On February 17, 2023, CSRC promulgated the Trial Administrative Measures of Overseas
Securities Offering and Listing by Domestic Companies ( ྤʫΆุྤ̮೯БᗇՎձɪ̹၍ଣ༊Б
) (the “ Overseas Listing Trial Measures ”), which came into effect on March 31, 2023 and
is applicable to direct and indirect overseas share subscription and listing of domestic companies,
which also stipulates the filing administrative measures and regulatory requirements for the
overseas securities offering and listing by domestic companies.
Guidelines for the Articles of Association of Listed Companies
On December 15, 2023, the CSRC promulgated the latest amended Guidelines for the Articles
of Association of Listed Companies (ˏ) (the “ Guidelines for the Articles of
Association ”). Pursuant to the Overseas Listing Trial Measures and its supporting guidelines,
Guidelines for Application of Regulatory Rules — Overseas Listing Category No. 1 (ቇ
ˏ — ྤ̮೯Бɪ̹ᗳୋ 1໮), domestic enterprises that are directly listed overseas shall
formulate its Articles of Association of the company with reference to the Guidelines for the
Articles of Association and other relevant provisions of the CSRC on the main provisions of the
PRC Company Law, the Overseas Listing Trial Measures and the Guidelines for the Articles of
Association.
The PRC Company Law
The Company Law of the PRC (hereinafter referred to as the “ PRC Company Law ”) was
adopted by the Standing Committee of the Eighth NPC at its Fifth Session on December 29, 1993
and came into effect on July 1, 1994, and was successively amended on December 25, 1999,
August 28, 2004, October 27, 2005, December 28, 2013 and October 26, 2018. The latest revised
PRC Company Law was implemented on July 1, 2024.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
–V - 5–


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A “joint stock company” refers to a corporate legal person incorporated in China under the
PRC Company Law with independent legal person properties and entitlements to such legal person
properties. The liability of the company for its own debts is limited to the total amount of all
assets it owns and the liability of its shareholders for the company is limited to the extent of the
shares they subscribe for.
A joint stock company shall obey the laws and administrative regulations when engaging in
business activities. It may invest in other limited liability companies and joint stock companies.
The liabilities of the company to such invested companies are limited to the amount invested.
Unless otherwise provided by laws, a joint stock company shall not be jointly and severally
liability for the debts of the invested enterprises in the capacity of a capital contributor.
Incorporation
A company may be incorporated by way of promotion or by raising. A company shall be
incorporated by one to 200 promoters, provided that at least more than half of the promoters must
reside in the PRC. For a company established by way of promotion, its registered capital is the
total share capital subscribed for by all the promoters registered with the company registration
authority. No shares shall be raised from others before the shares subscribed for by the promoters
are fully paid up. For a company established by raising, not less than 35% of its total number of
shares that shall be issued at the time of the establishment as stipulated in the Articles of
Association must be subscribed for by the promoters. However, where laws and administrative
regulations provide otherwise, such provisions shall prevail.
For companies incorporated by way of promotion, the promoters shall fully subscribe for the
shares to be issued upon the establishment of the company as stipulated in the Articles of
Association. Where capital is contributed in the form of non-monetary assets, the non-monetary
property used as capital shall be appraised and verified, and shall not be over- or under-valued. If
there are provisions in the laws and administrative regulations on valuation, such provisions shall
prevail. The promoter shall pay the full amount of the shares subscribed for by the promoter
before the establishment of the company, and if the promoter fails to pay the full amount of the
capital contribution by the due date, in addition to paying the full amount of the capital
contribution to the company, the promoter shall also be liable to compensate the company for the
losses caused to the company.
Where joint stock companies are established by raising, the shares subscribed by the
promoters shall not less than 35% of the total number of shares to be issued upon the
establishment of the company as stipulated in the Articles of Association, unless otherwise
provided for by laws or administrative regulations. A prospectus shall be published and a
subscription letter shall be prepared when the promoters openly solicits shares from the public.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
–V - 6–


--- page 695 ---
The subscription letter shall be filled in by the subscriber with the number of shares to be
subscribed, amount, address, and signed and sealed. The subscribers shall pay up monies for the
shares they subscribe for. Where a promoter is offering shares to the public, such offer shall be
underwritten by security companies established under PRC laws, and an underwriting agreement
shall be concluded thereon. A promoter offering shares to the public shall also enter into
agreements with banks in relation to the receipt of subscription monies. The receiving banks shall
receive and keep in custody the subscription monies, issue receipts to subscribers who have paid
the subscription monies and furnish evidence of receipt of those subscription monies to relevant
authorities. After the subscription monies for the share issue have been paid in full, a capital
verification institution established under PRC law must be engaged to conduct a capital
verification and furnish a certificate thereof. The promoters of joint stock companies established
by raising shall convene an inaugural meeting within thirty days from the date on which the
subscription monies for the shares to be issued upon the establishment of the company has been
fully paid up. The promoter shall notify the subscribers of the date of the meeting or make a
public announcement thereof fifteen days prior to the convening of the inaugural meeting. The
inaugural meeting shall be held in the presence of a majority of the subscribers holding voting
rights. Within 30 days of the conclusion of the inauguration meeting, the board of directors shall
apply to the company registration authority for registration of the establishment of the company. A
company is formally established and has the status of a legal person after approval of registration
has been given by the company registration authority and a business license has been issued. After
the establishment of the company, the board of directors shall verify the capital contributions of
the shareholders, and if it is found that the shareholders have not paid the capital contributions
stipulated in the Articles of Association in full and on time, a written reminder shall be issued by
the company to such shareholders to call for the payment of the capital contributions.
The promoters of a company shall:
(I) individually and jointly be liable for the payment of all liabilities and expenses incurred
in the incorporation process if the company cannot be incorporated;
(II) individually and jointly be liable for the repayment of subscription monies paid by
subscribers together with interest at bank rates of a deposit for the same period if the
company cannot be incorporated;
(III) be liable for the civil liabilities arising from the civil activities carried out by the
promoter in their own names in order to incorporate the company in the course of
incorporation of a company, which is requested by the option of the third party; and
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
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--- page 696 ---
(IV) in the course of incorporation of a company, if the promoters cause damage to another
person as a result of the performance of their duties in the incorporation of the
company, the company or the promoter who is not at fault may, after assuming the
liability, recover the compensation from the promoter who is at fault.
Share Capital
The promoters may make a capital contribution in currencies, or non-monetary assets such as
in kind or intellectual property rights or land use rights or equity interests or debentures which can
be appraised with monetary value and transferred lawfully, except for assets which are prohibited
from being contributed as capital by the laws or administrative regulations. If a capital
contribution is made in non-monetary assets, a valuation and verification of the assets contributed
must be carried out pursuant to the provisions of the laws or administrative regulations on
valuation without any over-valuation or under-valuation.
The capital of a company is divided into shares. All the shares of the company are either par
value or non-par value shares, according to the provisions of the Articles of Association. In the
case of par value shares, each share has an equal amount. The company may convert all issued par
value shares into non-par value shares or all non-par value shares into par value shares in
accordance with the provisions of the Articles of Association. In the case of non-par value shares,
more than one-half of the proceeds from the issuance of shares shall be credited to the registered
capital.
The issuance of shares shall be conducted in a fair and equitable manner. Each share of the
same class shall carry equal rights. Shares issued at the same time and within the same class shall
be issued on the same conditions and at the same price. The same price per share shall be paid by
any share subscriber (whether an entity or an individual). The offering price of par value share
certificates may be equal to or greater than the nominal value of the share, but may not be less
than the nominal value.
Increase in Share Capital
Pursuant to the PRC Company Law, an increase in the capital of a company by means of an
issue of new shares must be approved by shareholders in a general meeting. In addition, the
Securities Law of the PRC () (the “ PRC Securities Law ”) also
stipulates the following conditions for the company’s public offering of new shares:
(I) have a sound organisational structure with satisfactory operating;
(II) have the capability of sustainable operation;
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
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--- page 697 ---
(III) have been issued with an unqualified opinion audit report by the auditor for the
company’s financial and accounting reports in the latest three years;
(IV) the issuer and its controlling shareholder(s) and actual controllers do not have criminal
offences during the past three years for corruption, bribery, encroachment of assets,
misappropriation of assets or disruption of socialist market economy order; and
(V) other conditions required by the securities regulatory authorities of the State Council as
approved by the State Council. After the new shares issued by the company have been
fully paid up, the change must be registered with the company registration authority and
a public announcement shall be made.
Reduction of Share Capital
The company shall reduce the registered capital in accordance with the following procedures
as stipulated in the PRC Company Law:
(I) the company shall prepare a balance sheet and an inventory of properties;
(II) make a resolution at a general meeting to reduce the registered capital;
(III) the company shall notify its creditors within 10 days after making the resolution to
reduce the registered capital and publish the relevant announcement in newspapers or on
the National Enterprise Credit Information Publicity System within 30 days;
(IV) a creditor may, within 30 days after receipt of the notification, or within 45 days after
the date of announcement if he/she has not received the notification, have the right to
request the company to repay its debts or provide relevant guarantees; and
(V) the company must apply to the company registration authority for a change in
registration.
Repurchase of Shares
Under the provisions of the PRC Company Law, a company shall not repurchase its own
shares except in the following circumstances:
(I) reduction of the registered capital of the company;
(II) merger with another company that holds its shares;
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--- page 698 ---
(III) use of its shares for carrying out an employee stock ownership plan or equity incentive
plan;
(IV) request from shareholders who object to a resolution of a general meeting on merger or
division of the company to acquire their shares by the company;
(V) use of shares for conversion of convertible corporate bonds issued by the listed
company; and
(VI) it is necessary for a listed company to maintain its company value and protect its
shareholders’ equity.
A resolution of a general meeting is required for the repurchase of shares by a company
under either of the circumstances stipulated in item (I) to item (II) above; for a company’s
repurchase of shares under any of the circumstances stipulated in item (III), item (V) or item (VI)
above, a resolution of a meeting of the board of directors shall be made by more than two-thirds of
directors attending the meeting according to the provisions of the Articles of Association or as
authorized by the general meetings.
The shares acquired by the company according to the above provisions under the
circumstance stipulated in item (I) hereof a company shall be deregistered within 10 days from the
date of acquisition of shares; the shares shall be transferred or deregistered within six months if
the repurchase of shares is made under the circumstances stipulated in either item (II) or item (IV);
and the shares in the company held in total by the company after the repurchase of shares under
any of the circumstances stipulated in item (III), item (V) or item (VI) shall not exceed 10% of the
company’s total issued shares, and shall be transferred or deregistered within three years.
A listed company acquires its own shares shall perform their obligation of information
disclosure according to the provisions of the PRC Securities Law. A listed company acquires its
own shares under any of the circumstances stipulated in item (III), item (V) and item (VI) hereof,
shall be carried out trading in public and centralized manner.
A company shall not accept its own shares as the subject matter of a mortgage.
Transfer of Shares
Shares held by shareholders may be transferred legally. Under the PRC Company Law, a
shareholder should effect a transfer of his share on the Stock Exchange established in accordance
with laws or by other means as required by the State Council. The transfer of registered share
certificates by a shareholder must be conducted by means of an endorsement or by other means
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
–V - 1 0–


--- page 699 ---
stipulated by laws or by administrative regulations. Following the transfer of registered share
certificates, the company shall enter the names and domiciles of the transferee into its share
register. Change of the register of members described in the preceding paragraph shall not be
registered within 20 days before the convening of a general meeting or five days prior to the base
date on which the company decides to distribute dividends. However, where there are separate
provisions by law on the alternation of registration in the register of members of listed companies,
those provisions shall prevail. The transfer of bearer share certificates shall become effective upon
the delivery of the certificates to the transferee by the shareholder.
Pursuant to the PRC Company Law, shares issued prior to the public offering of the
company’s shares may not be transferred within one year from the date on which the company’s
share certificates are listed and traded on the Stock Exchange, provided that where laws,
administrative regulations or the securities regulatory authorities under the State Council provide
otherwise in respect of the transfer by shareholders or actual controllers of a listed company of the
shares in the company held by such shareholders or actual controllers, such provisions shall
prevail. Directors and the senior management of a company shall declare to the company their
shareholdings in it and any changes in such shareholdings. During their terms of office,
above-mentioned person may transfer no more than 25% of the total number of shares they hold in
the company every year; they shall not transfer the shares of the company they hold within one
year of the date of the company’s listing on the Stock Exchange, nor within six months after they
leave their positions in the company. The Articles of Association may set out other restrictive
provisions in respect of the transfer of shares in the company held by its directors and the senior
management.
Pursuant to the Overseas Listing Trial Measures, for a domestic company directly offering
and listing overseas, the shareholders of its domestic unlisted shares applying to convert its
domestic unlisted shares into overseas listed shares and listed and traded on an overseas trading
venue shall conform to relevant regulations promulgated by the CSRC, and appoint the domestic
company to file with the CSRC.
Shareholders
Pursuant to the PRC Company Law and the Guidelines for the Articles of Association, the
rights of shareholders include:
(I) to be legally entitled to assets income, participate in significant decision-making and
select management personnel;
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(II) to petition the people’s court to revoke any resolution of a general meeting or a
shareholders’ meeting and the board of directors that has been convened or whose
voting has been conducted in violation of the laws, administrative regulations or the
Articles of Association, or any resolution the contents of which is in violation of the
laws, administrative regulations or the Articles of Association of the company, provided
that such petition shall be submitted to the people’s court within 60 days of the passing
of such resolution;
(III) to transfer his/her shares legally;
(IV) to attend or appoint a proxy to attend general meetings and exercise the voting rights;
(V) to inspect the Articles of Association of the company, share register, counterfoil of
company debentures, the minutes of general meetings, resolutions of board meetings,
resolutions of the supervisory committee meetings and the financial and accounting
reports, and to make suggestions or inquiries in respect of the company’s operations;
(VI) to receive dividends in respect of the number of shares held;
(VII)to participate in the distribution of residual properties of the company in proportion to
their shareholdings upon the liquidation of the company; and
(VIII) any other shareholders’ rights provided for in laws, administrative regulations, other
normative documents and the Articles of Association of the company.
The obligations of shareholders include the obligation to abide by the Articles of Association
of the company, to pay the subscription monies in respect of the shares subscribed for, to be liable
for the company in respect of the shares taken up by them and any other shareholder obligation
specified in the Articles of Association of the company.
Pursuant to the Overseas Listing Trial Measures, a domestic company offering and listing
overseas shall file with the CSRC as per requirement of this Measures, submit relevant materials
that contain a filing report and a legal opinion, and provide truthful, accurate and complete
information on the shareholders, etc.
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General Meetings
The general meeting is the organ of authority of the company, which exercises its powers in
accordance with the relevant provisions of the PRC Company Law. The general meeting may
exercise the following powers:
(I) to elect and replace the directors and to decide on the matters relating to the
remuneration of directors;
(II) to consider and approve the reports of the board of directors;
(III) to consider and approve the reports of the supervisory committee;
(IV) to consider and approve the company’s profit distribution proposals and loss recovery
proposals;
(V) to decide on the increase or reduction of the company’s registered capital;
(VI) to decide on the issue of corporate bonds;
(VII)to decide on merger, division, dissolution and liquidation of the company or change of
its corporate form;
(VIII) to amend the Articles of Association;
(IX) to exercise other authority stipulated in the Articles of Association.
The general meeting may authorize the board of directors to make resolutions on the issuance
of corporate bonds.
Pursuant to the PRC Company Law and the Guidelines for the Articles of Association, a
general meeting is required to be held once a year. An extraordinary general meeting is required to
be held within two months upon the occurrence of any of the following:
(I) the number of directors is less than the number required by the law or less than
two-thirds of the number specified in the Articles of Association of the company;
(II) the total outstanding losses of the company amounted to one-third of the company’s
total paid-in share capital;
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(III) shareholders individually or jointly holding 10% or more of the company’s shares
request to convene an extraordinary general meeting;
(IV) the board of directors deems necessary;
(V) the supervisory committee so proposes; or
(VI) other circumstances as provided for in the Articles of Associations of the company.
The general meetings shall be convened by the board of directors and presided over by the
chairman of the board. Where the chairman of the board is unable or fails to perform his duty, the
general meetings shall be presided over by the vice chairman. Where the vice chairman is unable
or fails to perform his duty, the general meetings shall be presided over by a director jointly
elected by no less than one half of the members of the board of directors. Where the board of
directors is unable or fails to perform its duty in convening a general meeting, the supervisory
committee shall timely convene and preside over such meeting. Where the supervisory committee
fails to convene and preside over such meeting, shareholders who, individually or jointly, holding
10% or more of the Company’s total shares for 90 consecutive days may independently convene
and preside over the general meeting.
According to the PRC Company Law, to convene a general meeting, Company shall notify all
shareholders of the time, place and matters to be considered at the meeting 20 days before the date
of the general meeting; an extraordinary general meeting shall be notified to all shareholders 15
days before the date of meeting. Shareholders individually or jointly holding 1% or more of the
Company’s shares can make a provisional proposal in writing to the board of directors 10 days
before the date of general meeting; the board of directors shall notify other shareholders within 2
days after the receipt of such proposal and table the provisional proposal to the general meeting
for consideration. The contents of the provisional proposal shall fall within the scope of duties of
the general meeting, with clear topics and specific resolutions. A general meeting shall not make
any resolution in respect of any matter not stated in the two above-mentioned notices of meeting.
According to the PRC Company Law, shareholders present at general meeting have one vote
for each share they hold, save that shares held by the Company are not entitled to any voting
rights.
According to the provisions of the Articles of Association of the company or a resolution of
the general meeting, the accumulative voting system may be adopted for the election of directors
at the general meetings. Under the accumulative voting system, when the general meeting elects
directors, each share shall be entitled to vote equivalent to the number of directors to be elected
and the voting rights owned by shareholders can be used collectively. According to the PRC
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Company Law, resolutions of the general meeting shall be adopted by more than half of the voting
rights held by the shareholders present at the meeting. However, when the general meeting makes
a decision to modify the Articles of Association of the company, or to increase or reduce the
registered capital, and a resolution about the merger, division, dissolution or change of the
company form, such resolutions shall be adopted by shareholders holding two-thirds or more of the
voting rights of the shareholders in presence. Where the PRC Company Law and the Articles of
Association provide that the transfer or acquisition of significant assets or the provision of external
guarantees by the company and the other matters must be approved by way of resolution of the
general meeting, the board of directors shall convene a general meeting promptly to vote on such
matters by general meeting. Shareholders may entrust a proxy to attend shareholders’ general
meetings on his or her behalf by a power of attorney which sets forth the scope of exercising the
voting rights.
Minutes shall be prepared in respect of matters considered at the general meeting and the
chairperson and directors attending the meeting shall endorse such minutes by signature. The
minutes shall be kept together with the shareholders’ attendance register and the power of attorney.
Board of Directors
A company shall have a board of directors, which shall consist of 3 or more members. For a
company with more than 300 employees, members of the board of directors shall include staff
representatives, who shall be democratically elected by the company’s staff at a staff
representatives’ meeting, general staff meeting or otherwise. The term of office of the directors
shall be prescribed in the Articles of Association, but each term of office shall not exceed three
years. A director may seek reelection upon expiry of the said term. A director shall continue to
perform his/her duties as a director in accordance with the laws, administrative regulations and the
Articles of Association until a duly re-elected director takes office, if re-election is not conducted
in a timely manner upon the expiry of his/her term of office or if the resignation of directors
during his/her term of office results in the number of directors being less than the quorum.
According to the provisions of the PRC Company Law, the board of directors may exercise
the following powers:
(I) to convene general meetings and report on its work to the general meetings;
(II) to implement the resolutions adopted at the general meetings;
(III) to decide on the company’s operational plans and investment proposals;
(IV) to formulate the company’s profit distribution proposals and loss recovery proposals;
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--- page 704 ---
(V) to formulate proposals for the increase or reduction of the company’s registered capital
and the issue of corporate bonds;
(VI) to formulate proposals for the merger, division, dissolution of the company or change in
the form of the company;
(VII) to decide on the setup of the company’s internal management organs;
(VIII) to decide on appointment or dismissal the manager of the company and his/her
remuneration matters, and as nominated by the manager, to decide on appointment or
dismissal the company’s deputy manager and financial officer and his/her remuneration
matters;
(IX) to formulate the company’s basic management system; and
(X) other authority stipulated in the Articles of Association or granted by the general
meetings.
The board of directors shall hold at least two meetings each year. Notice of meeting shall be
given to all directors 10 days before the meetings. Interim Board meetings may be proposed to be
convened by shareholders representing more than one-tenth of the voting rights, more than
one-third of the directors. The chairman shall convene and preside the Board meeting within 10
days of receiving such proposal. The board of directors may otherwise determine the method of
giving notice and notice period for convening an interim meeting of the board of directors. Board
meetings shall be held only if more than one half of the Directors are present. Resolutions of the
board of directors shall be passed by more than one half of all Directors. Resolutions of the board
of directors shall be passed on a one person one vote basis. The Directors shall attend a Board
meeting in person. If a director is unable to attend for any reasons, he/she may appoint another
director by a written power of attorney specifying the scope of the authorization to attend the
meeting on his/her behalf. The board of directors shall make minutes of the meeting’s decisions on
the matters discussed at the meeting, and the directors attending the meeting shall sign the
minutes.
If a resolution of the board of directors violates any laws, administrative regulations or the
Articles of Association or resolutions of the general meeting, and as a result of which the company
sustains serious losses, the directors participating in the resolution are liable to compensate the
company. However, if it can be proved that a director expressly objected to the resolution when the
resolution was voted on, and that such objection was recorded in the minutes of the meeting, such
director shall be relieved from that liability.
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--- page 705 ---
According to the provisions of the PRC Company Law, the following person may not serve as
a Director of the company:
(I) devoid of or with restricted civil conduct ability;
(II) within five years after serving sentence for embezzlement, bribery, infringement or
misappropriation of property, or for jeopardizing socialist market economic order, or
within five years after serving sentence and being deprived of political rights for crime;
and within two years after the date of the completion of the probation period if
probation is announced;
(III) within three years after insolvency and liquidation of such company or enterprise where
the person acted as a directors, factory manager or manager and has been held
accountable for the insolvency;
(IV) within three years after company or enterprise the person acted as legal representative is
revoked business license and ordered to shut down for violating law on which the
person is held accountable; and
(V) has been listed as a defaulter by a People’s Court since he/she is liable to large amount
of unliquidated mature debts.
Where a company elects or appoints a director to which any of the above circumstances
applies, such election, appointment or designation shall be invalid. A director to which any of the
above circumstances applies during his/her term of office shall be released of his/her duties by the
company.
According to the provisions of the PRC Company Law, the board of directors shall appoint a
chairman and may appoint a vice chairman. The chairman and the vice chairman shall be elected
by the board of directors with approval of more than half of all the directors. The chairman shall
convene and preside over Board meetings and review the implementation of board resolutions. The
vice chairman shall assist the chairman to perform his/her duties. Where the chairman is incapable
of performing or is not performing his/her duties, the duties shall be performed by the vice
chairman. Where the vice chairman is incapable of performing or is not performing his/her duties,
a director jointly elected by more than half of the directors shall perform his/her duties.
A joint stock company may, as stipulated in its Articles of Association, establish an Audit
Committee within the board of directors composed of directors to exercise the functions and
powers prescribed for the supervisory committee by the PRC Company Law, without establishing a
supervisory committee or supervisor. The Audit Committee shall be composed of three or more
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--- page 706 ---
members, and more than half of all the members shall not hold positions in the company other
than as directors and shall not have any relationship with the company that may affect their
independent and objective judgment. Staff representatives in the board of directors of the company
may serve as the members of the Audit Committee. When the Audit Committee makes a resolution,
it shall be approved by more than half of all the members of the Audit Committee. When voting on
resolutions of the Audit Committee, one member shall have one vote. The methods of deliberation
and voting procedures of the Audit Committee shall be prescribed by the Articles of Association,
except as provided in the PRC Company Law.
The company may establish other committees in the board of directors as provided in the
Articles of Association.
Manager and Senior Management
According to the relevant provisions of the PRC Company Law, a company shall have a
manager who shall be appointed or removed by the board of directors. The manager, who is
responsible to the board of directors, may exercise his/her functions and powers in accordance
with the provisions of the Articles of Association or as authorized by the board of directors. The
manager shall attend the Board meetings. The board of directors may decide that a member of the
board of directors shall concurrently serve as the Manager.
According to the relevant provisions of the PRC Company Law, senior management refers to
the manager, deputy manager, financial officer, secretary to the board of directors of a listed
company and other personnel as stipulated in the Articles of Association.
Duties of Directors, General Manager and Other Senior Management
Directors and senior management are required under the PRC Company Law to comply with
the relevant laws, administrative regulations and the Articles of Association, and carry out their
duties of loyalty and diligence. Directors and senior management are prohibited from abusing their
authority in accepting bribes or other unlawful income and from embezzling the company’s
property.
In the meantime, directors and senior management are prohibited from:
(I) embezzling the company’s property and misappropriating company’s funds;
(II) depositing company funds into accounts under their own names or the names of other
individuals;
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--- page 707 ---
(III) using his/her authority to engage in bribery or accept other illegal income;
(IV) accept commissions from transactions between others and the company for their own
benefits;
(V) unauthorized disclose of confidential information of the company; and
(VI) other acts in violation of their duty of loyalty to the company.
Income generated by directors or senior management in violation of aforementioned shall be
returned to the company.
A director or senior management who contravenes the law, administrative regulation or
Articles of Association in the performance of his/her duties resulting in any loss to the company
shall be liable to the company for compensation.
Where a director or senior management is required to attend a general meeting, such director
or senior management shall attend the meeting and answer the inquiries from shareholders.
Directors and senior management shall furnish with relevant facts and information to the audit
committee without obstructing the exercise of functions and powers by the audit committee or its
members.
Where the directors and senior management violate laws, administrative regulations or the
Articles of Association in performance of duties to the company, thereby causing damages to the
company, the shareholders individually or jointly holding more than 1% of the shares in the
company for more than 180 consecutive days may request in writing the supervisory committee to
initiate proceedings in the people’s court. Where the supervisors violate the laws, administrative
regulations or the Articles of Association in performance of duties resulting in any loss to the
company, the aforementioned shareholder(s) may request in writing that the board of directors
institute litigation at a people’s court. Upon receipt of shareholders’ written request stipulated in
the preceding paragraph, if the supervisory committee or the board of directors refuses to file a
lawsuit or does not file a lawsuit within 30 days from receipt of such request, or in the event of
emergency where the interest of the company will suffer irreparable damages if lawsuit is not filed
immediately, the shareholders stipulated in the preceding paragraph shall have the right to file a
lawsuit directly with the people’s court in their own name for the interest of the company. For
other parties who infringe the lawful interests of the company resulting in loss to the company, the
aforementioned shareholder(s) may institute litigation at a people’s court in accordance with the
provisions described above. Where any director or senior management violates the provisions of
laws, administrative regulations or the Articles of Association, damaging interests of shareholders,
the shareholders may file a lawsuit with the people’s court.
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--- page 708 ---
The Overseas Listing Trial Measures stipulates that the filling materials for overseas listing
of domestic enterprises shall be true, accurate and complete, and shall not contain false records,
misleading statements or material omissions. Domestic enterprises and their controlling
shareholders, actual controllers, directors and senior management shall fulfill their obligations of
information disclosure in accordance with the law, be honest, trustworthy, diligent and responsible
and ensure that the filling materials are true, accurate and complete.
Finance and Accounting
According to the regulations of the PRC Company Law, a company shall establish its own
financial and accounting systems according to the laws, administrative regulations and the
regulations of the financial departments of the State Council. A company shall prepare its financial
reports at the end of each accounting year which shall be audited by accounting firm according to
law. The financial and accounting reports shall be prepared in accordance with the laws,
administrative regulations and the regulations of the financial departments of the State Council.
The company’s financial and accounting reports shall be made available for shareholders’
inspection at the company within 20 days before the convening of an annual general meeting. A
joint stock company that makes public stock offerings must announce its financial and accounting
reports.
When distributing each year’s after-tax profits, the company shall set aside 10% of its
after-tax profits for the company’s statutory common reserve fund. However, when the cumulative
amount of the common reserve fund has reached more than 50% of the PRC company’s registered
capital, it may no longer be allocated. When the company’s statutory common reserve fund is not
sufficient to make up for the company’s losses for the previous years, the current year’s profits
shall first be used to make up the losses before any allocation is set aside for the statutory
common reserve fund. After the company has made allocations to the statutory common reserve
fund from its after-tax profits, it may, upon passing a resolution at a general meeting, make further
allocations from its after-tax profits to the discretionary common reserve fund. After the company
has made up its losses and made allocations to its discretionary common reserve fund, the
remaining after-tax profits shall be distributed in proportion to the number of shares held by the
shareholders, except for those which are not distributed in a proportionate manner as provided by
the Articles of Association of the company.
Profits distributed to shareholders by a resolution of a general meeting or the board of
directors before losses have been made up and allocations have been made to the statutory
common reserve fund in violation of the requirements described above must be returned to the
company, and if any loss is caused to the company, the shareholders and the directors and senior
management who are responsible for such distribution shall be liable for compensation. The
company shall not be entitled to any distribution of profits in respect of its own shares held by it.
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--- page 709 ---
Premiums from shares issued by a company at an issue price above their nominal value and
other revenues required by the financial departments of the State Council to be stated as capital
common reserve fund shall be accounted for as the capital common reserve fund of the company.
The common reserve fund of a company shall be applied to make up the company’s losses,
expand its production and operations or convert it into an increase in its capital. If a company’s
losses are to be covered by the common reserve fund, the company shall first utilize the
discretionary common reserve fund and the statutory common reserve fund; if the losses still
cannot be covered, the company may utilize the capital common reserve fund in accordance with
the regulations. Upon the transfer of the statutory common reserve fund into capital, the balance of
the fund shall not be less than 25% of the registered capital of the company before such transfer.
The company shall have no accounting books other than the statutory books. The company’s
assets shall not be deposited in any account opened under the name of an individual.
Appointment and Dismissal of Auditors
Pursuant to the PRC Company Law, the appointment or dismissal of an accounting firm
responsible for the auditing of the company shall be determined by shareholders at a general
meeting, the board of directors in accordance with the Articles of Association. The accounting firm
should be allowed to make representations when the general meeting, the board of directors
conducts a vote on the dismissal of the accounting firm. The company should provide true and
complete accounting evidence, accounting books, financial and accounting reports and other
accounting information to the engaged accounting firm without any refusal or withholding or
misrepresentation of information.
The Overseas Listing Trial Measures require that securities companies and law firms should
conduct adequate verification of the filing materials of overseas listed enterprises.
Profit Distribution
According to PRC Company Law, a company shall not distribute profits before losses are
covered and the statutory common reserve fund is provided. At the same time, the Overseas
Listing Trial Measures stipulate that domestic enterprises may raise funds and pay dividends in
foreign currencies or RMB for overseas offerings and listings.
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Amendment to Articles of Association
Pursuant to PRC Company Law, the resolution of a general meeting of the company
regarding any amendment to a company’s Articles of Association must affirmative votes by more
than two-thirds of the votes held by shareholders attending the meeting. According to the
Guidelines for the Articles of Association of Listed Companies, if the amendments to the Articles
of Association of the company approved by the resolution of the general meeting are subject to
approval by the competent authority, they must be reported to the competent authority for
approval; if they involve company registration matters, the modification registrations shall be
handled according to law. Where the amendments to the Articles of Association belong to
information required to be disclosed by laws and regulations, such amendments shall be announced
in accordance with the regulations.
Dissolution and Liquidation
Pursuant to PRC Company Law, a company shall be dissolved for any of the following
reasons:
(I) upon expiry of term of business stipulated in the Articles of Association of the company
or occurrence of other circumstances of dissolution stipulated in the Articles of
Association of the company;
(II) the general meeting has resolved to dissolve the company;
(III) the company is dissolved by reason of its merger or division;
(IV) the business license of the company is revoked or the company is ordered to close down
or to be dissolved in accordance with the laws; or
(V) Where the company encounters serious difficulties in its operations and management
that will lead to significant losses to the benefits of the shareholders if the company
continues its existence and the situation cannot be resolved by other means, the
company is dissolved by a people’s court in response to the request of shareholders
representing more than 10% of the voting rights of all shareholders of the company, and
the people’s court shall dissolve the company in accordance with the circumstances.
If the company is dissolved as provided above, it shall publish an announcement for
dissolution in the National Enterprise Credit Information Publicity System within 10 days.
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--- page 711 ---
If the company has any of the circumstances described in paragraph (1) and (II) above and
has not yet distributed its assets to its shareholders, it may carry on its existence by amending
Articles of Association or by the resolution at a general meeting. The amendments to the Articles
of Association in accordance with the provisions described above shall require the approval of
more than two-thirds of voting rights of shareholders attending a general meeting.
Where the company is dissolved under the circumstances set forth in paragraph (I), (II), (IV)
or (V) above, it should establish a liquidation team within 15 days of the date on which the
dissolution matter occurs and commence the liquidation. The members of liquidation team shall be
composed of directors, unless otherwise elected by the Articles of Association or by the resolution
at a general meeting. If a liquidation team is not established within the prescribed period,
interested parties may file an application with a people’s court to appoint relevant personnel to
form a liquidation team to conduct the liquidation. The people’s court should accept such
application and form a liquidation team to conduct liquidation in a timely manner.
The liquidation team may exercise following duties and powers during the liquidation:
(I) to liquidate the company’s assets and to prepare a balance sheet and an inventory of
assets;
(II) to inform creditors by notice or announcement;
(III) to deal with and liquidate any relevant unfinished businesses of the company;
(IV) to pay all outstanding taxes and the taxes arising during the liquidation process;
(V) to settle claims and debts;
(VI) to allocate the company’s remaining assets after its debts have been paid off; and
(VII)to represent the company in civil lawsuits activities.
The liquidation team shall notify the company’s creditors within 10 days of its establishment,
and publish an announcement in newspapers or the National Enterprise Credit Information
Publicity System within 60 days. A creditor shall lodge his claim with the liquidation team within
30 days of receipt of the notification or within 45 days of the date of the announcement if he/she
has not received any notification.
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--- page 712 ---
The creditors declaring a claim shall explain matters relating to their claims and provide
evidential materials. The liquidation team shall register the creditor’s claims. In the claims
declaration period, the liquidation team shall not make repayment to the creditors.
Upon disposal of the company’s assets and preparation of the required balance sheet and
inventory of assets, the liquidation team shall draw up a liquidation plan and submit this plan to a
general meeting or a people’s court for endorsement. The remaining part of the company’s assets,
after payment of liquidation expenses, employee wages, social insurance fees and statutory
compensation, outstanding taxes and the company’s debts, shall be distributed in proportion to
shares held by them. The company shall continue its existence during the liquidation period,
although it cannot conduct operating activities that are not related to the liquidation. The
company’s assets shall not be distributed to shareholders before repayments are made in
accordance with the requirements described above.
Upon liquidation of the company’s assets and preparation of the required balance sheet and
inventory of assets, if the liquidation team becomes aware that the company does not have
sufficient assets to meet its liabilities, it must apply to a people’s court for a declaration of
bankruptcy in accordance with the laws. Following a company is declared bankrupt by the people’s
court, the liquidation team shall hand over the administration of the liquidation to the people’s
court.
Upon completion of the liquidation of the company, the liquidation team shall prepare a
liquidation report and submit it to the general meeting or a people’s court for confirmation and the
company registration authority to apply for cancelation of the company’s registration, and an
announcement of its termination shall be published. Members of the liquidation team are required
to discharge their duties in good faith and perform their liquidation obligation in compliance with
laws. Members of the liquidation team shall be prohibited from abusing their authority in
accepting bribes or other unlawful income and from embezzling the company’s properties.
Members of the liquidation team are liable to indemnify the company or its creditors in respect of
any loss of the company or its creditors arising from their willful or material default. Furthermore,
if the company is declared bankrupt according to laws, liquidation of a company bankrupt shall be
processed in accordance with the relevant laws on corporate bankruptcy.
Overseas Listing
According to the Overseas Listing Trial Measures, the securities refer to stocks, depositary
receipts, and corporate bonds that can be converted into stocks or other securities of an equity
nature that are directly or indirectly offered and listed overseas by domestic companies. The direct
overseas offering and listing of domestic companies refer to such overseas offering and listing of a
joint stock company incorporated in the territory of PRC. The indirect overseas offering and listing
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--- page 713 ---
of domestic companies refer to such overseas offering and listing made in the name of an entity
registered abroad but based on the equity, assets, earnings, or other similar interests of a domestic
company that operates its main business domestically.
The Overseas Listing Trial Measures also provide the conditions for overseas offering and
listing. An overseas offering and listing is prohibited under any of the following circumstances:
(I) the listing and financing fall under specific prohibiting in the laws, administrative
regulations, or relevant national provisions;
(II) the overseas offering and listing may endanger the national security as reviewed and
determined by competent authorities under the State Council in accordance with law;
(III) the domestic company or its controlling shareholder(s), actual controllers, have a
criminal record in recent three years for corruption, bribery, encroachment of assets,
misappropriation of assets, or disruption of socialist market economy order;
(IV) the domestic company is under investigation according to law for suspected crimes or
major violations of laws and regulations, but no clear conclusions have been reached;
(V) there are material ownership disputes over the equities held by the controlling
shareholders or the shareholders whose actions are controlled by the controlling
shareholders or actual controllers.
In addition, under the Overseas Listing Trial Measures, where a PRC domestic company
submits an application for initial public offering to competent overseas regulators or overseas
stock exchanges, such issuer must file with the CSRC within three business days after such
application document is submitted.
In the event of the occurrence of any of the following material events after the overseas
offering and listing, the PRC domestic companies shall make a detailed report to the CSRC within
three working days after the occurrence and public announcement of the relevant event:
(I) change in controlling rights;
(II) being subject to investigation, punishment, or other measures by overseas securities
regulatory authorities or the relevant competent authorities;
(III) changing the listing status or transferring the listing board;
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(IV) voluntary or compulsory termination of a listing.
Pursuant to the Notice on Administrative Arrangements for Filing Concerning Overseas
Issuance and Listings by Domestic Enterprises (ஷ
), which was promulgated by the CSRC on February 17, 2023 and came into effect on the
same date, a domestic enterprise which has been issued and listed overseas before March 31, 2023
as stock enterprise (“ stock enterprise ”). The stock enterprise shall not need to file immediately,
but the enterprise shall file as required if it involves the file matters such as refinancing
subsequently. For the purpose of the domestic enterprise that has been granted approval letter by
the CSRC for the overseas public raised shares and listing (including issuance of additional shares)
by a joint stock company, the domestic enterprise may continue to promote overseas issuing and
listing upon the expiration of the validity of the approval letter. The domestic enterprise shall file
as required if it has not completed overseas issuing and listing upon the expiration of the validity
of the approval letter.
Pursuant to the Provisions on Strengthening Confidentiality and Archives Administration
Concerning Overseas Securities Offerings and Listings by Domestic Enterprises (̋੶ྤʫ
 ), which was issued by the CSRC,
MOF, the National Administration of State Secrets Protection and the National Archives
Administration on February 24, 2023 and implemented since March 31, 2023, a domestic
enterprise that provides or publicly discloses or through its overseas listed entity, provides or
publicly discloses to relevant entities including securities companies, securities service providers
and overseas regulators and individuals, any document and materials that contain state secrets or
working secrets of government agencies, shall obtain approval from competent authorities
according to law, and files with the secrecy administrative department at the same level. A
domestic enterprise that provides accounting archives or copies of accounting archives to any
entities including securities companies, securities service providers and overseas regulators and
individuals shall fulfill due procedures in compliance with applicable national regulations.
Loss of Share Certificates
A shareholder may, in accordance with the public notice procedures set out in the PRC Civil
Procedure Law, apply to a people’s court if his share certificate(s) in registered form is either
stolen, lost or destroyed, for a declaration that such certificate(s) will no longer be valid. After the
people’s court declares that such certificate(s) will no longer be valid, the shareholder may apply
to the company for the issue of a replacement certificate.
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Merger and Division
Under the PRC Company Law, if companies merge, a merger agreement shall be signed and
the relevant companies shall prepare their respective balance sheets and asset lists. The companies
are required to notify their respective creditors within 10 days from the date of passing the merger
resolution and publish a merger announcement in newspapers within 30 days. Within 30 days from
the date of receipt of the notification or 45 days from the date of the announcement if no
notification has been received, the creditors may demand the companies to settle any outstanding
debts or to provide guarantees accordingly.
In case of a merger, the debts and liabilities of the merging parties shall be assumed by the
surviving or the newly established company. In case of a division, the company’s assets shall be
divided accordingly and balance sheets and asset lists shall be prepared. If the resolution for the
demerger of the company is passed, the company shall notify all its creditors within 10 days from
the date of passing the said resolution and shall announce the demerger in the newspapers within
30 days. The relevant liabilities of the company prior to the demerger (unless the company has
reached a written agreement with its creditors on the settlement of the pre-demerger liabilities)
shall be assumed jointly by the demerged company, except for those otherwise agreed by the
company in a written agreement with its creditors on the settlement of the liabilities prior to the
demerger.
Changes in registration arising from merger or division of a company shall be registered with
the relevant Administration for Industry and Commerce.
The PRC Securities Laws, Regulations and Regulatory Regimes
The PRC has promulgated a series of regulations that relate to the issue and trading of shares
and disclosure of information. In October 1992, the State Council established the Securities
Committee and CSRC. The Securities Committee is responsible for coordinating the drafting of
securities regulations, formulating securities-related policies, planning the development of
securities markets, directing, coordinating, and supervising all securities-related institutions in the
PRC, and administering CSRC. The CSRC is the regulatory executive body of the Securities
Committee and is responsible for the drafting of regulatory provisions governing securities
markets, supervising securities companies, regulating public offerings of securities by PRC
companies in the PRC or overseas, regulating the trading of securities, compiling securities-related
statistics and undertaking relevant research and analysis. In April 1998, the State Council
consolidated the two departments and reformed the CSRC.
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On April 22, 1993, the State Council promulgated the Provisional Regulations Concerning the
Issue and Trading of Shares (၍ଣᅲБૢԷ) governing the application and
approval procedures relating to the public offerings of shares, issuance of and trading in shares,
the acquisition of listed companies, deposit, clearing, and transfer of shares, the disclosure of
information, investigation, penalties and dispute resolutions with respect to a listed company.
The PRC Securities Law took effect on July 1, 1999, and was revised on August 28, 2004,
October 27, 2005, June 29, 2013, August 31, 2014, and December 28, 2019, respectively, with the
latest revised the PRC Securities Law taking effect on March 1, 2020. The PRC Securities Law is
the first national securities law in the PRC, comprehensively regulating activities in the PRC
securities market. It is divided into 14 chapters and 226 articles, including the issue and trading of
securities, takeovers by listed companies, securities exchanges, securities companies, and the
responsibilities of the securities registration and settlement institutions and securities regulatory
authorities. Article 224 of the PRC Securities Law provides that domestic enterprises issuing
shares overseas directly or indirectly or listing and trading of their shares overseas shall comply
with the relevant provisions of the State Council. Currently, the issue and trading of foreign-issued
securities (including shares) are principally governed by the regulations and rules promulgated by
the State Council and CSRC.
Arbitration and Enforcement of Arbitral Awards
The Arbitration Law of the PRC () (the “ PRC Arbitration Law ”)
was enacted by the SCNPC on August 31, 1994, which became effective on September 1, 1995,
and was amended on August 27, 2009, and September 1, 2017. The PRC Arbitration Law is
applicable to, among other matters, economic disputes involving foreign parties where all parties
had entered into a written agreement by arbitration before an arbitration committee constituted in
accordance with the PRC Arbitration Law. The PRC Arbitration Law provides that an arbitration
committee may, before the promulgation of arbitration regulations by the PRC Arbitration
Association, formulate interim arbitration rules in accordance with the PRC Arbitration Law and
the PRC Civil Procedure Law. Where the parties have agreed to settle disputes by means of
arbitration, a people’s court will refuse to handle a legal proceeding initiated by one of the parties
at such people’s court unless the arbitration agreement is invalid.
Under the PRC Arbitration Law and the PRC Civil Procedure Law, an arbitral award shall be
final and binding on the parties involved in the arbitration. If any party fails to comply with the
arbitral award, the other party to the award may apply to a people’s court for its enforcement. A
people’s court may refuse to enforce an arbitral award made by an arbitration commission if there
is any procedural irregularity (including but not limited to the composition of the arbitration
commission in violation of the legal procedures, or the making of an award on matters beyond the
scope of the arbitration agreement, or the jurisdiction of the arbitration commission).
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Any party seeking to enforce an award of a foreign affairs arbitral body of the PRC or whose
property is not located within the PRC may apply to a foreign court with jurisdiction over the case
for recognition and enforcement of the award. Likewise, an arbitral award made by a foreign
arbitral body may be recognized and enforced by a PRC court in accordance with the principle of
reciprocity or any international treaties concluded or acceded to by the PRC.
The PRC acceded to the Convention on the Recognition and Enforcement of Foreign Arbitral
Awards () (the “ New Y ork Convention ”), adopted on June 10,
1958 pursuant to a resolution passed by the SCNPC on December 2, 1986. The New York
Convention provides that all arbitral awards made in a state which is a party to the New York
Convention shall be recognized and enforced by other parties thereto subject to their rights to
refuse recognition and enforcement under certain circumstances, including violations of the public
policy of that state. At the time of the PRC’s accession to the Convention, the SCNPC declared
that (I) the PRC will only apply the Convention to the recognition and enforcement of arbitral
awards made in the territories of other parties based on the principle of reciprocity; and (II) the
New York Convention will only be applied to disputes deemed under PRC laws to be arising from
contractual or non-contractual mercantile legal relations.
An agreement has been reached between Hong Kong and the Supreme People’s Court of the
PRC for the mutual enforcement of arbitral awards. On June 18, 1999, the Supreme People’s Court
of the PRC adopted the Arrangement on Mutual Enforcement of Arbitral Awards between Mainland
and Hong Kong Special Administrative Region (ʝੂБ΀൒൒Ӕ
τર), which became effective on February 1, 2000. The Supreme People’s Court of China
issued the Supplementary Arrangements on the Mutual Enforcement of Arbitral Awards between
the Mainland and the Hong Kong Special Administrative Region (޴
໾̂τર) on November 26, 2020, which came into effect on November 27,
2020. The arrangements reflect the spirit of the New York Convention. Pursuant to the
arrangements, awards made by mainland arbitral authorities acknowledged by Hong Kong can be
enforced in Hong Kong, and Hong Kong arbitration awards are also enforceable in mainland
China. Where a court of the mainland finds that enforcement in the mainland of the ruling made
by the Hong Kong arbitral authority will violate public interests of the mainland, execution of the
ruling may be ignored.
Judicial Judgment and its Enforcement
According to the Arrangement on Mutual Recognition and Enforcement of Judgments in Civil and
Commercial Matters by the Courts of the Mainland and of the Hong Kong Special Administrative Region
Pursuant to Agreed Jurisdiction by Parties Concerned (৫
τર) (the “Arrangement”) promulgated by the
Supreme People’s Court on July 3, 2008 and implemented on August 1, 2008, in the case of final
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judgment, defined with payment amount and enforcement power, made between the court of Mainland
China and the court of the Hong Kong Special Administrative Region in a civil and commercial case with
written jurisdiction agreement, any party concerned may apply to the People’s Court of China or the court
of the Hong Kong Special Administrative Region for recognition and enforcement based on this
arrangement. “Written jurisdiction agreement” refers to a written agreement defining the exclusive
jurisdiction of either the People’s Court of China or the court of the Hong Kong Special Administrative
Region in order to resolve any dispute with particular legal relation occurred or likely to occur by the
party concerned. Therefore, the party concerned may apply to the People’s Court of China or the court of
the Hong Kong Special Administrative Region to recognize and enforce the final judgment made in China
or Hong Kong that meets certain conditions of the aforementioned regulations. On January 18, 2019, a
further arrangement was reached between Hong Kong Special Administrative Region and the Supreme
People’s Court, Arrangements for Reciprocal Recognition and Enforcement of Judgments in Civil and
Commercial Cases between Courts of the Mainland and Hong Kong Special Administrative Region ( ௰
τર) (the “ New
Arrangement”), which became effective and replace the Arrangement on January 29, 2024, privileged
that “Written jurisdiction agreement” reached under the Arrangement before January 29, 2024 will still
apply. This New Arrangement further stipulates the scope and content of judgments applicable to the
reciprocal recognition and enforcement and corresponding procedures and methods for applying, the
circumstances concerning review, non-recognition and enforcement upon the jurisdiction of the court of
first instance and the means of remedy. Non-monetary judgments and judgments on some intellectual
property cases are included in the reciprocal recognition and enforcement of judgments in accordance
with this New Arrangement.
2. MATERIAL DIFFERENCES BETWEEN CERTAIN ASPECTS OF CORPORATION
LA W IN THE PRC AND HONG KONG
The Hong Kong law applicable to a company incorporated in Hong Kong is based on the
Companies Ordinance and the Companies (Winding Up and Miscellaneous Provisions) Ordinance
and are supplemented by common law and the rules of equity that are applicable to Hong Kong.
As a joint stock company established in the PRC, the Company is governed by the PRC Company
Law and all other applicable rules and regulations promulgated pursuant to the PRC Company
Law.
Set out below is a summary of material differences between Hong Kong law applicable to a
company incorporated in Hong Kong and the PRC Company Law applicable to a joint stock
company incorporated and existing under the PRC Company Law. This summary is, however, not
intended to be an exhaustive comparison.
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Corporate Existence
Under the Hong Kong law, a company with share capital, shall be incorporated by the
Registrar of Companies in Hong Kong by issuing certificate of incorporation and the company will
acquire an independent corporate existence. A company may be incorporated as a public company
or a private company. Pursuant to the Companies Ordinance, the Articles of Association of a
private company incorporated in Hong Kong shall contain pre-emption provisions. A public
company’s Articles of Association do not contain such provisions.
Under the PRC Company Law, a joint stock company may be incorporated by promotion or
subscription.
Hong Kong law does not provide for minimum capital required for companies in Hong Kong.
Share Capital
No authorized share capital is required under the laws of Hong Kong. The share capital of the
Hong Kong company is issued share capital. All proceeds from the issue of shares will be credited
to the share capital and will form part of the share capital of a company. The directors of the Hong
Kong company may issue new shares of the company with the prior approval of the shareholders
(if necessary).
The PRC Company Law also does not provide for authorized share capital. The registered
capital is the amount of our issued share capital. Any increase in registered capital shall be
approved by the general meetings and filed with the relevant PRC government and regulatory
authorities.
Under the PRC Company Law, shareholders may make capital contributions in the form of
money or appraised non-monetary assets including real objects, intellectual property and land use
right which can be appraised in money and transferred according to laws. Non-monetary assets to
be used as capital contributions must be appraised and verified and should not be overvalued or
undervalued. There is no such restriction on a Hong Kong company under Hong Kong law.
Restrictions on Transfer of Shares
Under PRC law, a joint stock company’s domestic shares, which are denominated and
subscribed for in Renminbi, in the share capital, generally may only be subscribed for and traded
by the State, PRC legal persons, natural persons or other investment institutions permitted by laws
and regulations. Overseas listed shares, which are denominated in Renminbi and subscribed for in
a currency other than Renminbi, may only be subscribed for, and traded by, investors from Hong
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--- page 720 ---
Kong, Macau or Taiwan or any country and territory outside the PRC, or qualified domestic
institutional investors. If H shares are qualified securities of the Hong Kong Stock Connect, the
said shares may also be subscribed for or traded by Chinese investors based on a limited amount
according to rules of the Shanghai Hong Kong Stock Connect or Shenzhen-Hong Kong Stock
Connect. Upon the completion of the filing procedures of CSRC for Full Circulation Application,
the domestic unlisted shares of the H share listed company might be listed and circulated on the
Hong Kong Stock Exchange.
Under the PRC Company Law, a promoter of a joint stock company is not allowed to transfer
the shares it holds for a period of one year after the date of establishment of the company. Shares
issued prior to the public offering cannot be transferred within one year from the listing date of the
shares of the company on a Stock Exchange. Shares in a joint stock company held by its directors
and senior management transferred each year during their term of office shall not exceed 25% of
the total shares they held in the company, and the shares they held in the company cannot be
transferred within one year from the listing date of the shares, and also cannot be transferred
within half a year after such persons have left office. The Articles of Association may set other
restrictive requirements on the transfer of the company’s shares held by its directors and senior
management.
There are no such restrictions on shareholdings and transfers of shares under Hong Kong law
apart from (i) six-month lock-up period on the company’s issue of additional shares and (ii) the
12-month lock-up period on controlling shareholders’ disposal of shares after listing.
Financial Assistance for Acquisition of Shares
The PRC Company Law does not prohibit or restrict a joint stock company or its subsidiaries
from providing financial assistance for the purpose of an acquisition of its own or its holding
company’s shares. However, Guidelines for the Articles of Association stipulates that, the company
(including its subsidiaries) shall not give any financial assistance, in the forms of gift, advance,
guarantee, compensation or loan, to any person who purchases or proposes to purchase shares of
the company.
Notice of General Meetings
Under the PRC Company Law, notices of an annual general meeting and an extraordinary
general meeting of the joint stock company must be given to shareholders 20 days and 15 days
before the meeting, respectively. For a limited liability company incorporated in Hong Kong, the
minimum period of notice is 14 days in case of other shareholders’ meetings other than annual
general meeting and 21 days in the case of an annual general meeting.
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Quorum for General Meetings
Under Hong Kong Company Law, the quorum for a general meeting must be two members
unless the Articles of Association of the company otherwise provide. For companies with only one
member, the quorum must be one member. The PRC Company Law does not specify any quorum
requirement for a general meeting.
Voting at General Meeting
Under the PRC Company Law, the passing of any resolution of a general meeting requires
affirmative votes of shareholders representing more than half of the voting rights represented by
the shareholders who attend the general meeting in person or by proxy except in cases of
resolutions on amendments to a Articles of Association, increase or decrease of registered capital,
merger, division or dissolution, or change of corporation form, which require affirmative votes of
shareholders representing not less than two-thirds of the voting rights represented by the
shareholders who attend the general meeting in person or by proxy.
Under Hong Kong law, (i) an ordinary resolution may be passed by a simple majority of
affirmative votes of the shareholders who attend the general meeting in person or by proxy, and
(ii) a special resolution may be passed by no less than three fourths of affirmative votes of the
shareholders who attend the general meeting in person or by proxy.
Variation of Class Rights
The PRC Company Law makes no specific provision relating to variation of class rights.
However, the PRC Company Law states that the State Council can otherwise promulgate
requirements relating to other kinds of shares.
Under the Companies Ordinance, no rights attached to any class of shares can be varied
unless:
(I) If there are provisions in the Articles of Association relating to the variation of those
rights, then in accordance with those provisions;
(II) If there are not relevant provisions in the Articles of Association, then (a) with the
consent in writing of at least three fourths of the total voting rights of holders of the
relevant class of shares, or (b) with the approval of a special resolution of the holders of
the relevant class of shares at a separate meeting.
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Directors
The PRC Company Law, unlike Hong Kong law, does not contain any requirements relating
to the declaration of directors’ interests in material contracts, restrictions on directors’ rights to
carry out major disposals or companies providing certain benefits, or prohibitions against
compensation for loss of office without shareholders’ approval. The PRC Company Law restricts
the directors of a listed company who have interests or associations in the enterprises involved in
the resolution of the board meetings from voting on the said resolution. All the above provisions
have been incorporated in the Articles of Association, which are summarized in Appendix IV .
Derivative Action by Minority Shareholders
Hong Kong law permits minority shareholders to initiate a derivative action on behalf of all
shareholders against directors who have committed a breach of their fiduciary duties to the
company if the directors control a majority of votes at a general meeting, thereby effectively
preventing a company from suing the directors in breach of their fiduciary duties in its own name.
Pursuant to the PRC Company Law, in the event that the directors, senior management violate
laws, administrative regulations or the Articles of Association in performance of duties to the
company, thereby causing damages to the company, the shareholders individually or jointly
holding more than 1% of the shares in the company for more than 180 consecutive days may
request in writing the supervisory committee to initiate proceedings in the people’s court. If the
supervisors are involved in the aforesaid circumstance, the above said shareholders may send
written request to the board of directors to initiate proceedings in the people’s court. Upon receipt
of such written request from the shareholders, if the supervisory committee or the board of
directors refuses to initiate such proceedings, or has not initiated proceedings within 30 days upon
receipt of the request, or if under urgent situations, failure of initiating immediate proceeding will
cause irremediable damages to the company, the above said shareholders shall, for the benefit of
the company’s interests, have the right to initiate proceedings directly to the court in their own
name.
The Guidelines for the Articles of Association of Listed Companies also stipulates that, in the
event that the directors or senior management violate laws, administrative regulations or the
Articles of Association in the course of performance of their duties, thereby causing damages to
the company, the shareholders individually or jointly holding more than 1% of the shares in the
company for more than 180 consecutive days may request in writing the supervisory committee to
initiate proceedings in the people’s court; in the event that supervisory committee violate laws,
administrative regulations or the Articles of Association in the course of performance of their
duties, thereby causing damages to the company, shareholders may send written request to the
board of directors to initiate proceedings in the people’s court. Where any director or senior
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management violates the provisions of laws, administrative regulations or the Articles of
Association, damaging interests of shareholders, the shareholders may initiate proceedings in the
people’s court.
Protection of Interests of Minority Shareholders
Under Hong Kong law, the company may be wound up by the court if the court considers that
it is just and equitable to do so, in addition, a shareholder who complains that the affairs of a
company incorporated in Hong Kong are conducted in a manner unfairly prejudicial to his/her
interests may petition to the court to either wind up the company or make an appropriate order
regulating the affairs of the company. In addition, on the application of a specified number of
members, the Financial Secretary of Hong Kong may appoint inspectors who are given extensive
statutory powers to investigate the affairs of a company incorporated in Hong Kong.
The PRC Company Law stipulates that if the company’s operation and management are
seriously distressed and continuous existing will cause significant losses to shareholders’ interests
and cannot be resolved through other channels, shareholders holding more than 10% of the
company’s shareholders’ voting rights may request the people’s court to dissolve the company. The
Guidelines for the Articles of Association of Listed Companies, however, contains provisions
requiring controlling shareholders and ultimate controllers of a company shall have a duty of care
to the company and the public shareholders of the company. Controlling shareholders shall
exercise investors’ rights in strict accordance with the law and shall not damage the lawful
interests of a company or of the public shareholders of the company in any way such as via the
distribution of profits, the asset reorganization, external investments, the occupying of company
funds or the provision of a loan guarantee, nor shall they abuse their controlling positions to
damage the interests of the company or of the public shareholders of the company.
Financial Disclosure
Under the PRC Company Law, a joint stock company is required to make its financial reports
available at the company for inspection by shareholders 20 days before its annual general meeting.
In addition, a company of which the shares are publicly offered must publish its financial reports
in accordance with the PRC Company Law. A company shall prepare its financial and accounting
reports at the end of each fiscal year, and submit the same to be audited by certified public
accountants as required by law.
The Companies Ordinance requires a company to send to every shareholder a copy of its
balance sheet, auditors’ report and board’s report, which are to be presented at its annual general
meeting, not less than 21 days before such meeting.
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Information on Directors and Shareholders
The PRC Company Law gives shareholders the right to inspect the Articles of Association,
minutes of the general meetings and financial and accounting reports. Under the Articles of
Association, shareholders have the right to inspect and copy (at reasonable charges) certain
information on shareholders and directors which is similar to the shareholders’ rights of Hong
Kong companies under Hong Kong law.
Dividend and Receiving Agent
Under the Hong Kong law, dividends once declared are debts payable to shareholders. The
limitation period for debt recovery action under Hong Kong law is six years, while under the PRC
law, this limitation period is three years.
Corporate Reorganization
Corporate reorganization involving a company incorporated in Hong Kong may be effected in
a number of ways, such as a transfer of the whole or part of the business or property of the
company in the course of voluntary winding up to another company pursuant to Section 237 of the
Companies (Winding up and Miscellaneous Provisions) Ordinance or a compromise or debt
repayment arrangement between the company and creditors or between the company and
shareholders under Section 673 and Section 674 of the Companies Ordinance, which requires the
sanction of the court. In addition, pursuant to the Companies Ordinance, subject to the
shareholders’ approval, an intra-group wholly-owned subsidiary company may also be
amalgamated horizontally or vertically.
Under PRC law, merger, division, dissolution or change in the form of a joint stock company
must be approved in the general meetings by shareholders.
Arbitration of Disputes
In Hong Kong, disputes between shareholders and a company or its directors, managers and
other senior management may be resolved through the courts. The Guidelines for the Articles of
Association of Listed Companies provide that shareholders may sue directors, managers and other
senior management of the company, and shareholders may sue the company, and the company may
sue its shareholders, directors, managers and other senior management.
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Statutory Deduction
Under the PRC Company Law, a joint stock company is required to make transfers equivalent
to certain prescribed percentages of its after-tax profit to the statutory common reserve fund. There
are no corresponding provisions under Hong Kong law.
Remedies of the Company
Under the PRC Company Law, if a director or senior management violate the provisions of
laws, administrative regulation or the Articles of Association in performance of duties to the
company, which results in damage to the company, that director or senior management shall be
liable for compensation. In addition, the company’s remedies are similar to those available under
Hong Kong law (including rescission of the relevant contract and recovery of profits from a
director or senior management), in line with the Listing Rules.
Fiduciary Duties
In Hong Kong, there is the common law concept of the fiduciary duty of directors. Under the
PRC Company Law, directors and senior management are subject to obligations of loyalty and
diligence. Under the Guidelines for the Articles of Association, directors shall not conclude any
contract or engage in any transaction with a company either in violation of the provisions of the
Articles of Association of the company or without the approval of the general meetings.
Closure of Register of Shareholders
The Companies Ordinance requires that the register of shareholders of a company must not
generally be closed for the registration of transfers of shares for more than 30 days (extendable to
60 days under certain circumstances) in a year, whereas, as required by the PRC Company Law,
change of the register of shareholders arising from share transfer shall not be registered within 20
days before convening of a general meeting or within 5 days prior to the base date on which the
company decides to distribute dividends.
Any person wishing to have detailed advice on PRC laws or the laws of any jurisdiction is
recommended to seek independent legal advice.
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This appendix sets out summaries of the main clauses of our Articles of Association adopted
on November 5, 2025 and the Articles of Association shall come into force from the date when the
publicly issued H Shares of the Company are listed for trading on the main Board of the Hong
Kong Stock Exchange. As the main purpose of this Appendix is to provide potential investors with
an overview of the Articles of Association, it may not necessarily contain all information that is
important for potential investors. As discussed in the appendix headed “Appendix VIII —
Documents Delivered to the Registrar of Companies and Available on Display” to this document,
the full document of the Articles of Association in Chinese is available for examination.
DIRECTORS AND BOARD OF DIRECTORS
Power to dispose of our Company’s or any of our subsidiaries’ assets
The Board of Directors shall determine the authority of external investment, acquisition and
sale of assets, asset mortgage, external guarantee matters, entrusted financial management,
related-party transactions and external donations, and establish strict review and decision-making
procedures; and material investment projects shall be reviewed by relevant experts and
professionals and reported to the general meeting for approval. The Board’s decision-making
authority of the Company’s external investment, acquisition and sale of assets, asset mortgage and
pledge, external guarantee matters, entrusted financial management, related-party transactions,
external donations and other matters is as follows:
(I) To decide on external guarantee matters other than those required to be reviewed and
approved by the general meeting as stipulated by laws, administrative regulations,
departmental rules, supervisory rules of the place where the Company’s Shares are listed
and the Articles of Association. When the Board reviews a guarantee matter, such matter
must be reviewed and approved by more than two-thirds of the Directors present at the
Board’s meeting.
(II) To decide on the related-party transaction between the Company and connected person if
any of the percentage ratios (other than profit ratios) for a transaction on normal
commercial terms or on better terms of such related-party transaction, meets all of the
following horizontal cut-off requirements:
1. 0.1% or more;
2. 1% or more if the transaction is a connected transaction solely because it involves
a “connected person” at the “subsidiary” level; and
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-1 –


--- page 727 ---
3. 5% or more if the total consideration (in the case of “financial assistance”, the
aggregate amount of the “financial assistance” together with any pecuniary benefit
paid to the connected person or jointly held entity) is also HK$3 million or more;
Provided that any percentage ratio (other than a profit ratio) for a transaction on
normal commercial terms or better terms meets all the following horizontal cut-off
requirements, it shall be submitted to the general meeting for consideration:
1. 4.5% or more; and
2. 25% or more if the total consideration (and in the case of financial assistance,
the aggregate amount of the financial assistance together with any pecuniary
benefit paid to the connected person or jointly held entity) is also HK$10
million or more,
(III) To decide on the following transactions (except for the provision of guarantees):
1. the total assets involved in the transaction account for more than 5% of the total
value of the company’s assets as set out in its annual accounts or its most recently
published interim report;
2. the operating revenue of the object of the transaction (such as equity) for the latest
accounting year accounts for more than 5% of the company’s audited operating
revenue for the latest accounting year;
3. the net profit related to the object of the transaction (such as equity) for the latest
accounting year accounts for more than 5% of the company’s audited net profit for
the latest accounting year;
4. the transaction consideration represents 5% or more of the average of the market
capitalization of the company over the five days preceding the transaction date;
5. if the company uses equity as the transaction consideration, the number of shares
used as consideration represents 5% or more of the total number of shares of the
company;
6. any other matters that are required to be submitted to the Board for approval under
the Hong Kong Listing Rules or relevant laws and regulations.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-2 –


--- page 728 ---
When a company is not profitable, consideration should be given to whether an alternative
net profit indicator can be selected or the application of the foregoing net profit indicator can be
waived.
The above transactions are defined in Article 45, Paragraph 3 of the Articles of Association.
The above transactions shall be submitted to the general meeting for deliberation and approval
after the Board of Directors’ deliberation and approval if such matters are required to be submitted
to the Shareholders’ meeting for deliberation and approval as stipulated in the laws, regulations,
regulatory documents, the rules of the place where the Company’s Shares are listed, and the
Articles of Association.
Compensation or payments for loss of office
Not applicable.
Loans to Directors
The Articles of Association do not contain any specific provision in respect of loaning to
Directors. However, if the loans to Directors is a significant matter such as a connected transaction
under the Articles of Association, it shall be strictly in accordance with the relevant system to
fulfill the decision-making procedures to be reviewed by the Board of Directors or be reported to
the general meeting for approval.
Disclosure of interests in contracts with our Company or any of our subsidiaries
Directors who directly or indirectly enter into a contract or a transaction with the Company
shall report to the Board of Directors or at the general meeting on matters related to entering into
the contract or transaction, which shall be approved by a resolution of the Board of Directors or
the at the general meeting in accordance with the provisions of the Articles of Association.
The provisions of the preceding paragraph shall apply to entering into contracts or
transactions with the Company by close family members of the Directors, enterprises directly or
indirectly controlled by the Directors or their close family members, and associates who have other
affiliations with the Directors.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-3 –


--- page 729 ---
Provision of financial assistance to purchase the Shares of our Company or any of our
subsidiaries
The Company or its subsidiaries (including its affiliates) shall not provide any financial
assistance to those who purchase or intend to purchase the Company’s Shares in the form of gifts,
advances, guarantees, compensations, or loans.
Remuneration
The appointment and removal of the members of the Board of Directors, as well as their
remuneration and payment methods, shall be adopted by the general meeting by ordinary
resolution.
Retirement, appointment, removal
The Company sets up the Board of Directors which shall be responsible for the general
meeting. The Board of Directors shall consist of eight Directors, including three independent
non-executive Directors. All Directors shall be elected at the general meeting. The Board of
Directors has one chairman and one vice chairman. The Board of Directors shall be elected by
more than half of all Directors.
The Directors shall be elected or replaced by the general meeting, and may be removed by an
ordinary resolution of the general meeting before the expiration of their terms of office, subject to
the relevant laws, administrative regulations, departmental rules, regulatory documents and the
requirements of the Hong Kong Listing Rules. The Directors serve three-year terms, and can be
re-elected and reappointed at the end of the term.
The term of office of a Director shall be calculated from the date of appointment until the
expiration of the term of office of the current Board of Directors. If the term of office of a
Director expires without timely re-election, the original Director shall still perform the duties of a
Director in accordance with laws, administrative regulations, departmental rules, supervisory rules
of the place where the Company’s Shares are listed and the Articles of Association before the
newly elected Director takes office.
Directors may be concurrently served by the general manager or other senior management
personnel, but the total number of Directors concurrently serving as general manager or other
senior management personnel and Directors served by employee representatives shall not exceed
one-half of the total number of Directors of the Company.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-4 –


--- page 730 ---
The procedures for the selection and appointment of a Director are as follows:
(1) Shareholders who individually or jointly own more than 1% of the Company’s Shares or
the Board of Directors make a proposal for a Director candidate;
(2) the Nomination Committee of the Board of Directors selects and reviews the director
candidate and his/her qualifications and makes recommendations to the Board of
Directors for his/her selection and appointment;
(3) the Board of Directors considers the appointment of the Director;
(4) the Board of Directors submits a proposal for the consideration of the Director candidate
to the general meeting;
(5) the proposal for the Director candidate is voted on at the general meeting;
(6) the Director approved by the general meeting takes office.
Directors of the Company are natural persons. A person cannot serve as a Director of the
Company if any of the following circumstances applies, and a Director candidate cannot be
nominated as a Director of the Company if any of the following circumstances applies:
(1) a person without capacity or with restricted capacity for civil acts;
(2) a person who has been sentenced to punishment because of corruption, bribery,
infringement of property, misappropriation of property or sabotaging the socialist market
economic order; or who has been deprived of his political rights on committing an
offence, where less than five years have elapsed since the date of the completion of
implementation of such punishment or deprivation, and less than two years have elapsed
since the date of the completion of the probation review if a suspended sentence is
announced;
(3) a person who is a former director, factory manager or manager of a company or
enterprise which has entered into insolvent liquidation and he is personally liable for the
insolvency of such company or enterprise, where less than three years have elapsed
since the date of the completion of the insolvency and liquidation of the company or
enterprise;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-5 –


--- page 731 ---
(4) a person who is a former legal representative of a company or enterprise which had its
business licence revoked and ordered for closure due to a violation of law and he is
personally liable for that, where less than three years have elapsed since the date of the
revocation of the business licence and the closure ordered;
(5) the person is personally liable for a substantial debt which is due for payment but
remains unpaid;
(6) the person is banned by the CSRC from entering into the securities market for a period
which has not yet expired;
(7) other circumstances as stipulated by the laws, administrative regulations, departmental
rules or other contents stipulated in supervisory rules of the place where the Company’s
Shares are listed.
For any election and appointment of a Director in contravention of the foregoing provisions,
such election, appointment or employment shall be void and null. Where a Director falls into any
of the circumstances stipulated in this article in his term of office, the Director shall be removed
from office by the Company.
Powers to issue bonds
The Board of Directors shall be entitled to develop plans for our Company to issue bonds,
and such plans must be implemented after being approved at the general meeting under the
Articles of Association.
Duties
Directors owe loyalty duties to the Company. They should take measures to avoid conflicts
between their own interests and those of the Company, and should not use their authority to obtain
improper benefits. Directors shall comply with laws, administrative regulations and the Articles of
Association and undertake the following loyalty duties to the Company:
(1) not to exploit his/her position to accept bribes or to obtain other illegal income, and not
to encroach upon the Company’s properties;
(2) not to misappropriate the funds of the Company;
(3) not to deposit the assets or funds of the Company into an account opened in their own
names or the name of another individual;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-6 –


--- page 732 ---
(4) not to violate the provisions of the Articles of Association by lending the Company’s
funds to others or using the Company’s properties to provide guarantees to others
without the consent of the general meeting or the consent of the Board of Directors;
(5) not to enter into a contract or transaction with the Company in violation of the
provisions of the Articles of Association or without the consent of the general meeting;
(6) without the consent of the general meeting, not to take advantage of their positions to
capture business opportunities which should have been taken by the Company for
themselves or others to engage in the same type of businesses as the Company’s on their
own or for others;
(7) not to accept commissions from transactions with the Company as their own;
(8) not to disclose the secrets of the Company without authorization;
(9) not to take advantage of their relationship with the Company as related parties to
compromise the interests of the Company;
(10) any other loyalty duties stipulated in the laws, administrative regulations, departmental
rules, supervisory rules of the place where the Company’s Shares are listed and the
Articles of Association.
Any gain arising from the violation of the foregoing provisions by Directors shall belong to
the Company. Such Directors shall be liable for compensation for any loss of the Company arising
therefrom.
Directors owe diligence duties to the Company. In performing their duties, they shall exercise
the level of care that a reasonably prudent manager would exercise in the best interests of the
Company. Directors shall comply with laws, administrative regulations, supervisory rules of the
place where the Company’s Shares are listed and the Articles of Association, and perform their
diligence obligations to the Company as follows:
(1) to exercise the rights accredited by the Company in cautious, serious and diligent
manners so as to ensure that the commercial behaviours of the Company are in
compliance with the PRC laws, administrative regulations and economic policies, and
the commercial activities do not exceed the scope of business stipulated in the business
license;
(2) to treat all Shareholders in a fair and equitable manner;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-7 –


--- page 733 ---
(3) to acquire the knowledge of the business operation and management of the Company on
a timely basis;
(4) to sign the written confirmation of regular reports of the Company;
(5) to provide the relevant true details and data to the Audit Committee, and not to interfere
with the Audit Committee or its members in their exercise of powers;
(6) other duties of diligence stipulated by the laws, administrative regulations, departmental
rules, supervisory rules of the place where the Company’s Shares are listed and the
Articles of Association.
ALTERNATIONS TO CONSTITUTIONAL DOCUMENTS
Variation of rights of existing Shares or classes of Shares
In any of the following circumstances, the Company shall amend the Articles of Association:
(1) after amendments are made to the Company Law or relative laws, and administrative
regulations, the Articles of Association run counter to the said amendments;
(2) the conditions of the Company have changed, and such change is inconsistent with the
matters in the Articles of Association;
(3) the general meeting has resolved to amend the Articles of Association.
If the amendment of the Articles of Association approved by a resolution at the general
meeting requires approval by the competent authority, it must be submitted to the competent
authority for approval. If it involves Company registration matters, change registration shall be
handled in accordance with the law.
The Board of Directors shall amend the Company’s Articles of Association in accordance
with the resolution of the general meeting to amend the Articles of Association and the approval
opinions of relevant competent authorities.
SPECIAL RESOLUTIONS — MAJORITY REQUIRED
A special resolution at a general meeting shall be passed by more than two-thirds of the
voting rights held by Shareholders (including their proxies) attending the general meeting.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-8 –


--- page 734 ---
The following matters shall be resolved by a special resolution at a general meeting:
(1) amendments to the Articles of Association and its annexes (including the Rules of
Procedure for the general meetings, the Rules of Procedure for the Board of Directors
and the Rules of Procedure for the Audit Committee);
(2) issue and listing of bonds or any types of Shares, warrants and other similar securities
of the Company;
(3) any increase or reduction in the Company’s registered capital;
(4) merger, division, dissolution, liquidation or change of the corporate form of the
Company;
(5) purchase or disposal of material assets or provision of guarantees to others by the
Company of a value exceeding 30% of the Company’s total assets within one year;
(6) the equity incentive plan and the employee shareholding scheme;
(7) the acquisition of the Company’s Shares by the Company under the circumstances set
out in Article 25(1) and (2) of the Articles of Association;
(8) other matters that would have a material impact on the Company and shall be approved
by special resolutions as determined by ordinary resolutions of general meeting;
(9) Other matters required to be approved by special resolutions in accordance with laws,
regulations and other relevant provisions, the Articles of Association or the Rules of
Procedure for the general meeting.
The rights of class Shareholders to be changed or abolished by the Company shall be passed
by a special resolution of the relevant class Shareholders at a separate general meeting before
proceeding when the Company’s share capital is divided into different classes of Shares.
VOTING RIGHTS (GENERALLY AND ON A POLL)
The Shareholders (including their proxies) shall exercise their voting rights according to the
number of voting Shares that they represent and each Share shall have one vote, except for class
Shareholders (if applicable).
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-9 –


--- page 735 ---
The Company’s Shares which are held by the Company do not carry any voting rights and
shall not be counted in the total number of voting Shares represented by Shareholders attending a
general meeting.
Shareholders who have a significant interest in the matters to be considered at the general
meeting shall abstain from voting. The number of Shares of a Shareholder who has avoided voting
shall not be counted as part of the total number of valid votes cast.
REQUIREMENTS FOR ANNUAL GENERAL MEETINGS
The general meetings are divided into annual general meetings and extraordinary general
meetings. The annual general meeting shall be convened once a year and be held within six
months of the end of the previous accounting year. The extraordinary general meeting is held from
time to time. When an extraordinary general meeting shall be held in case of the circumstances
specified in Article 47 of the Articles of Association, the extraordinary general meeting shall be
convened within two months.
ACCOUNTING AND AUDITS
Financial and accounting policies
The Company formulates its financial and accounting system in accordance with the laws,
administrative regulations, the securities regulatory rules of the place where the Company’s Shares
are listed and the provisions of relevant PRC authorities.
At the end of each accounting year, the Company shall prepare a financial report which shall
be audited and verified according to law.
The financial report of the Company shall include the following financial accounting
statements and associated breakdown:
(1) balance sheet;
(2) profit and loss statement;
(3) cash flow statement;
(4) notes to the financial accounting statements;
(5) profit distribution statement.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 0–


--- page 736 ---
Where there are special requirements imposed by laws, administrative regulations, normative
documents promulgated by competent authorities and the supervisory rules of the place where the
Company’s Shares are listed for the financial statements, such requirements shall prevail.
The Company’s financial reports shall be made available for Shareholders’ inspection at the
Company twenty days before the date of every annual shareholders’ general meeting.
The Company shall send (hereinafter referred to as post) by post, postage paid, 21 days
before the date of the annual general meeting, to each shareholder of its overseas listed shares, an
annual report comprising the annual accounts and a copy of the auditor’s report thereon. The
address of each shareholder shall be as recorded in the register of members of the Company.
Subject to the conditions of the laws, administrative regulations and the regulatory rules of the
place where the Company’s Shares are listed, the Company may adopt the form of announcement
(including publication through the Company’s website and the website of the Hong Kong Stock
Exchange). Once the announcement has been made and the corresponding procedures have been
fulfilled in accordance with the laws, administrative regulations and regulatory rules of the place
where the Company’s Shares are listed, all Shareholders are deemed to have received the aforesaid
financial report.
The financial statements of the Company shall be prepared in accordance with PRC
accounting standards and regulations as well as international accounting standards or the
accounting standards of its overseas listing place. If there is any material difference between the
financial statements prepared in accordance with the two accounting standards, such difference
shall be stated in the notes to the financial statements. When the Company distributes its after-tax
profits of the relevant accounting year, the lower of the after-tax profits as shown in the two
financial statements, which are prepared in accordance with (i) PRC accounting standards and
regulations; or (ii) international standards or the accounting standards of its overseas listing place,
shall prevail.
Interim results or financial information published or disclosed by the Company shall be
prepared in accordance with PRC accounting standards and regulations as well as international
standards or the accounting standards of its overseas listing place.
The Company shall comply with the Listing Rules of the Hong Kong Stock Exchange to issue
an annual results announcement and an interim results announcement by not later than three
months after the end of the financial year and two months after the end of the first six months’
period of each year respectively.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 1–


--- page 737 ---
The Company shall comply with the rules of the Hong Kong Stock Exchange to issue an
annual report and an interim report by not later than four months after the end of the financial year
and not later than three months after the end of the first six months of each year respectively.
The Company shall not maintain separate account books other than the statutory ones. The
Company’s funds shall not be deposited in any account opened in the name of any individual.
Appointment and dismissal of accounting firms
Our Company employs accounting firms that comply with the provisions of the PRC
Securities Law and the supervisory rules of the place where the Company’s Shares are listed to
conduct accounting statement auditing, net asset verification, other related consulting services and
other businesses. The term of employment is one year and can be renewed.
The appointment of an accounting firm by the Company must be decided at a general
meeting, and the Board of Directors shall not appoint an accounting firm before the decision is
made at the general meeting.
The Company guarantees to provide the hired accounting firm with true and complete
accounting vouchers, accounting books, financial accounting reports, and other accounting
materials, and shall not refuse, conceal, or give false information.
The audit fee of an accounting firm shall be determined by the general meeting.
When the Company dismisses or no longer renews the appointment of an accounting firm, the
accounting firm shall be notified 10 days in advance. When the dismissal of an accounting firm is
voted on at the general meeting, the accounting firm is allowed to state its opinions.
If the accounting firm resigns, it shall explain to the general meeting whether the Company
has any improper circumstances.
NOTICE AND AGENDA OF GENERAL MEETINGS
The general meeting is the organ of authority of the Company, and shall exercise the
following functions and powers according to law:
(1) to determine the operating principles and investment plans of the Company;
(2) to elect and replace any Director not being employee representative, and to determine
the remuneration of the relevant Directors;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 2–


--- page 738 ---
(3) to review and approve the reports of the Board of Directors;
(4) to review and approve the Company’s profit distribution plans and loss recovery plans;
(5) to resolve on the Company’s increase or decrease of registered capital;
(6) to resolve on the issue and listing of bonds or any types of Shares, warrants and other
similar securities of the Company;
(7) to resolve on the Company’s merger, division, dissolution, liquidation or change of its
corporate form;
(8) to modify the Articles of Association;
(9) to resolve on the engagement, dismissal of the accounting firm, the audit fees of the
accounting firm or the way determining the audit fees;
(10) to review and approve the guarantees as stipulated in Article 44 of the Company’s
Articles of Association;
(11) to review matters relating to the Company’s acquisition or disposal of significant assets
within one year in an amount exceeding 30% of the latest audited total assets of the
Company;
(12) to review and approve matters relating to the changes in the use of proceeds;
(13) to review the equity incentive plan and the employee shareholding scheme;
(14) other powers and functions of the general meeting as set forth in the rules of procedure
for the Company’s general meeting; and to consider and review other matters which
shall be decided at the general meeting under the laws, administrative regulations,
departmental regulation, normative documents, the Hong Kong Listing Rules or the
Articles of Association.
The above-mentioned functions and powers of the general meeting shall not be exercised by
the Board of Directors or other institutions or individuals through authorization. Where the general
meeting authorises the Board of Directors to excise certain powers, the details of the authorisation
shall be clear and specified.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 3–


--- page 739 ---
The following acts of external guarantees of the Company shall be submitted to the general
meeting for deliberation after being reviewed and approved by the Board of Directors:
(1) any external guarantee with a single guarantee amount of 25% or more of the asset
ratio, the consideration ratio, the profitability ratio and the income ratio (“ Percentage
Ratios ”), as measured in accordance with the criteria set out in Chapter 14 of the Hong
Kong Listing Rules;
(2) any single guarantee for an amount more than 10% of the Company’s net assets as
audited in the latest period;
(3) any guarantee to be provided after the total amount of guarantees provided by the
Company or its subsidiaries has exceeded 50% of the Company’s net assets as audited in
the latest period;
(4) any guarantee to be provided for a party whose liability-to-asset ratio exceeds 70%;
(5) the amount guaranteed by the Company within 12 consecutive months exceeds 30% of
its latest audited total assets;
(6) any guarantee to be provided after the total amount of external guarantees provided by
the Company has exceeded 30% of the Company’s total assets as audited in the latest
period;
(7) any guarantee to be provided to a Shareholder or an actual controller or a related party
thereof;
(8) other circumstances as stipulated in the Hong Kong Listing Rules, relevant laws,
regulations, other normative documents or the Articles of Association.
When the Board of Directors considers guarantee matters, it must be approved by more than
two-thirds of the directors present at the Board of Directors meeting. When the guarantee
mentioned in clause (5) above is reviewed at the general meeting, it shall be passed by more than
two-thirds of the voting rights held by the Shareholders present at the meeting.
When a proposal on providing any guarantee for any Shareholder, actual controller and its
related party is being reviewed at the general meeting, the said Shareholder or the Shareholders
controlled by the said actual controller shall abstain from voting on the proposal, and the proposal
shall be subject to approval by more than half of the voting rights of the other Shareholders
attending the general meeting.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 4–


--- page 740 ---
Any transaction (other than the provision of guarantees) of the Company that meets one of
the following criteria shall be submitted to the general meeting for review and approval if:
(1) the total assets involved in the transaction account for 25% or more of the total value of
the company’s assets as set out in its annual accounts or its most recently published
interim report;
(2) the operating revenue of the subject of the transaction (such as equity) for the latest
accounting year accounts for 25% or more of the company’s audited operating revenue
for the latest accounting year;
(3) the net profit related to the subject of the transaction (such as equity) for the latest
accounting year accounts for 25% or more of the company’s audited net profit for the
latest accounting year;
(4) the transaction consideration represents 25% or more of the average of the market
capitalization of the company over the five days preceding the transaction date;
(5) if the company uses equity as the consideration, the number of shares used as
consideration represents 25% or more of the total number of shares of the company;
(6) any other matters that are required to be submitted to the general meeting for approval
under the Hong Kong Listing Rules or relevant laws and regulations.
When the Company is not profitable, consideration should be given to whether an alternative
net profit indicator can be selected or the application of the foregoing net profit indicator can be
waived.
The above-mentioned “transactions” include: purchase or disposal of assets; external
investments (including entrusted wealth management, investments in subsidiaries, etc., excluding
establishment or capital increase of wholly-owned subsidiaries); giving financial assistance
(including entrusted loans); providing guarantees (referring to guarantees provided by the
Company to others, including guarantees to controlling subsidiaries); leasing of assets as lessee or
lessor; signing management contracts (including entrusted or trusted operations, etc.); giving or
receiving assets as a gift; restructuring of claims or debts; transfer of research and development
projects; entering into license agreements; waiver of rights (including waiver of preemptive rights
and priority to subscribe for capital contribution).
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 5–


--- page 741 ---
The following activities of the Company are not subject to the provisions of the preceding
paragraph: (1) purchase of raw materials, fuels and power related to daily operations (excluding
the purchase and disposal of such assets involved in asset replacement); (2) disposal of products,
commodities and other assets related to daily operations (excluding the purchase and disposal of
such assets involved in asset replacement); (3) main business activities of the Company, although
the transactions stipulated in the preceding paragraph are carried out.
The Company shall convene an extraordinary general meeting within two months upon the
actual occurrence of any of the following circumstances:
(1) the number of Directors is less than the number specified in the Company Law or
two-thirds of the number specified in the Articles of Association;
(2) the losses of the Company that have not been made up reach one-third of its total
paid-in share capital;
(3) a request is made by a Shareholder or Shareholders holding separately or in aggregate
more than 10% of the Shares of the Company;
(4) whenever the Board of Directors considers necessary;
(5) when proposed by the Audit Committee;
(6) any other circumstances as provided by laws, administrative regulations, departmental
rules or the Articles of Association.
The Company shall convene a general meeting at the place where the Company is domiciled
or at other location as specified in the notice convening the general meeting.
The general meeting shall have a venue and be held on-site. Subject to the laws,
administrative regulations, departmental rules, regulatory documents and the Hong Kong Listing
Rules, the Company may also hold a video or telephone conference, or hold a meeting by way of
circulating written resolutions or other means to facilitate Shareholders’ participation in the
general meeting. Shareholders who participate the general meeting in the aforesaid manners shall
be deemed to be present.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 6–


--- page 742 ---
Procedures for the general meeting:
A majority of independent non-executive Directors have the right to propose to the Board of
Directors that an extraordinary general meeting be held. Where an independent non-executive
Director proposes that an extraordinary general meeting be held, the Board of Directors shall, in
accordance with laws, administrative regulations and the Articles of Association, give a written
response on whether or not it agrees that an extraordinary general meeting should be held within
ten days of receiving the proposal.
Where the Board of Directors agrees to hold an extraordinary general meeting, it shall send
out a general meeting notice within five days of making its resolution; where the Board of
Directors declines to hold an extraordinary general meeting, its reasons shall be given and
announced.
The Audit Committee has the right to propose to the Board of Directors that an extraordinary
general meeting be held and shall make any such proposal to the Board of Directors in writing.
The Board of Directors shall, in accordance with laws, administrative regulations and the Articles
of Association, give a written response on whether or not it agrees that an extraordinary general
meeting should be held within ten days of receiving the proposal.
Where the Board of Directors agrees to hold an extraordinary general meeting, it shall send
out a general meeting notice within five days of making its resolution. Changes to the original
proposal(s) in the notice shall be subject to the consent of the Audit Committee.
Where the Board of Directors declines to hold an extraordinary general meeting nor does it
respond within 10 days upon receipt of the proposal, the Board shall be deemed to be incapable of
or has failed in performing the duty of convening a general meeting, in which case the Audit
Committee may convene and preside over such meeting by itself.
Shareholder(s) who individually or jointly hold more than 10% of the Company’s Shares shall
have the right to propose that the Board of Directors hold an extraordinary general meeting; any
such request to the Board of Directors shall be made in writing. The Board of Directors shall, in
accordance with laws, administrative regulations and the Articles of Association, give a written
response on whether or not it agrees that an extraordinary general meeting should be held within
ten days of receiving any such request.
Where the Board of Directors agrees to hold an extraordinary general meeting, it shall send
out a general meeting notice within five days of making its resolution. Changes to the original
request(s) in the notice shall be subject to the consent of the Shareholders concerned.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 7–


--- page 743 ---
Where the Board of Directors declines to hold an extraordinary general meeting nor does it
respond within 10 days upon receipt of such request, Shareholder(s) who individually or jointly
hold more than 10% of the Company’s Shares shall have the right to propose to the Audit
Committee to convene an extraordinary general meeting; any such request to the Audit Committee
shall be made in writing.
Where the Audit Committee agrees to hold an extraordinary general meeting, it shall send out
a general meeting notice within five days upon receipt of such request. Changes to the original
proposal(s) in the notice shall be subject to the consent of the Shareholders concerned.
Failure of the Audit Committee to issue the notice of the general meeting within the
stipulated period shall be deemed as the failure of the Audit Committee to convene and preside
over a general meeting, and Shareholders severally or jointly holding more than 10% of the
Company’s Shares for more than 90 consecutive days shall be entitled to convene and preside over
the general meeting on their own.
Where the Audit Committee or Shareholders decide(s) to convene a general meeting on their
own, they shall notify the Board in writing, and file with the securities regulatory authority at the
place of incorporation of the Company and the place where the Company’s Shares are listed in
accordance with applicable regulations (if necessary).
Before announcing the resolutions of the general meeting, the convening Shareholders should
not hold less than 10% of the Shares.
The Audit Committee or the convening Shareholders shall submit relevant supporting
materials (if necessary) to the securities regulatory authority at the place of incorporation of the
Company and the place where the Company’s Shares are listed in accordance with applicable
regulations when issuing the notice of the general meeting and the announcement of the
resolutions of the general meeting.
The contents of the proposal of the general meeting shall fall within the terms of reference of
the general meeting, and the proposal shall provide clear agenda and specific matters on which
resolutions are to be made, and shall comply with the relevant provisions of the laws,
administrative regulations, the Listing Rules and the Articles of Association. The general meeting
shall not vote on and make a resolution for any proposal not specified in the notice of general
meeting or not in compliance with the foregoing provisions.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 8–


--- page 744 ---
When the Company holds a general meeting, the Board of Directors, the Audit Committee
and Shareholder(s) independently or jointly holding more than 1% of the Company’s Shares shall
have the right to make proposals to the Company. The Company shall not increase the
shareholding of Shareholders who put forward interim proposals.
Shareholders independently or jointly holding more than 1% of the Company’s Shares may,
ten days before the general meeting is held, put forward interim proposals and submit such
proposals in writing to the conveners. Interim proposals should have a clear topic and specific
resolutions. The conveners shall notify other Shareholders within 2 days after receiving any such
proposal and submit the same to the general meeting for consideration, provided that the interim
proposal may not violate laws, administrative regulations or the Articles of Association, or fall
within the scope of authority of the general meeting.
Except the circumstances prescribed in the preceding paragraph, the conveners shall not
modify the proposals listed or add any new proposal to such proposals in the general meeting
notice after sending it out.
The conveners shall inform each Shareholder of the annual general meeting 21 days before
the convening such meeting and shall inform each Shareholder of the extraordinary general
meeting 15 days before convening such meeting. When calculating the starting date, the convening
date of the meeting shall be excluded.
The notice of the general meeting shall include the following contents:
(1) the time, venue and duration of the meeting;
(2) matters and proposals to be considered at the meeting;
(3) a prominent written statement as follows: all Shareholders have the right to attend the
general meeting, and may authorize in written form a proxy, who need not necessarily
be a Shareholder of the Company, to attend and vote at the meeting;
(4) the equity registration date on which Shareholders are entitled to attend the general
meeting;
(5) the name and telephone number of permanent contact persons for the affairs of the
meeting;
(6) the voting time and procedure via the internet or through other means;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 1 9–


--- page 745 ---
(7) where any director, general manager and other senior management personnel have a
material interest in respect of the matters to be discussed, then the nature and extent of
that interest shall be disclosed; where the impact of the matters to be discussed on such
director, general manager and other senior management personnel who are Shareholders
is different from the impact on other Shareholders of the same type, then that difference
shall be illustrated.
The specific details of all proposals shall be adequately and fully disclosed in all general
meeting notices and supplementary notices. Where matters to be discussed require independent
non-executive Directors’ opinions, the opinions and reasons given by the independent
non-executive Directors shall be disclosed when the general meeting notice or supplementary
notice is issued.
TRANSFER OF SHARES
Unless otherwise provided for in laws, administrative regulations, departmental rules,
regulatory documents, the Hong Kong Listing Rules and the Company’s Articles of Association,
the Shares of the Company may be transferred in accordance with law.
The Company shall not accept the Shares of the Company as collaterals of any pledges.
The Shares issued before the public issuance of any Shares by the Company shall not be
transferred within one year from the date when the Shares of the Company are listed and traded in
a stock exchange.
During their terms of office, the Directors and senior management officers of the Company
shall report to the Company their shareholdings in the Company and changes therein and shall not
transfer more than 25% of the total number of Shares of the Company held by them each year
during their terms of office determined at the time of their assumption of office; the Shares of the
Company held by them shall not be transferred within one year from the date when the Shares of
the Company are listed and traded. The aforesaid persons shall not transfer the Shares of the
Company held by them within six months from the date when they leave office.
Where the Shares of the Company are pledged within the time limit for transfer prescribed by
laws or administrative regulations, the pledgee may not exercise the pledge right within the time
limit for transfer.
If the Company’s Directors, senior management officers, and Shareholders holding more than
5% of the Shares of the Company sell the Shares held by them or other securities in the nature of
equity within six months after buying the same or buy such Shares or securities within six months
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 0–


--- page 746 ---
after selling the same, the earnings arising therefrom shall belong to the Company and the Board
shall recover such earnings. However, the following circumstances shall be excluded where a
securities company holds more than 5% of the Shares due to its purchase of any remaining Shares
under underwriting and in other circumstances stipulated by the supervisory rules of the place
where the Company’s Shares are listed or by the CSRC.
If the Board of Directors of the Company fails to comply with the preceding paragraph, the
Shareholders are entitled to request the Board of Directors to do so within 30 days. If the Board of
Directors of the Company fails to do so within the aforesaid period, the Shareholders are entitled
to initiate litigation directly before the people’s court in their own names for the interests of the
Company. And if the Board of Directors fails to comply with the aforesaid provisions, the
Directors held accountable for such failure shall bear joint and several liabilities in accordance
with the law.
The Shares or other securities in the nature of equity held by a Director, a senior management
officer or a natural person Shareholder as said above shall include the Shares or other securities in
the nature of equity held by his or her spouse, parents and children and held through any other
person’s account.
THE COMPANY’S AUTHORITY TO REPURCHASE SHARES
The Company shall not repurchase its Shares. However, exceptions are made in any of the
following circumstances:
(1) reducing the registered capital of the Company;
(2) merging with another company that holds the Shares of the Company;
(3) granting the Shares for the employee shareholding scheme or as equity incentives;
(4) Shareholders who disagree with the resolutions for the merger and division of the
Company made at the general meeting may demand the Company to repurchase their
Shares;
(5) using the Shares to satisfy the conversion of corporate bonds convertible into the Shares
issued by the Company;
(6) safeguarding corporate value and Shareholders’ rights as deemed necessary;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 1–


--- page 747 ---
(7) other circumstances permitted by laws, administrative regulations, departmental rules,
regulatory documents, the Hong Kong Listing Rules and regulatory authorities.
Where the Company repurchases the Shares of the Company due to the circumstances
specified in items (1) and (2) of the preceding paragraph, it shall be subject to a resolution of the
general meeting; where the Company repurchases the Shares of the Company due to the
circumstances specified in items (3), (5) and (6) of the preceding paragraph, it can be, in
accordance with the provisions of the Articles of Association or authorisation by the general
meeting, resolved by a meeting of the Board of Directors with the attendance of more than
two-thirds of the Directors. Subject to the Hong Kong Listing Rules, after the Company has
repurchased its Shares in accordance with the preceding paragraph, in case of the circumstance
described in item (1), the repurchased shares shall be cancelled within 10 days from the date of
repurchase; or in case of the circumstances described in items (2) and (4), shall be transferred or
cancelled within 6 months; or in case of the circumstances described in items (3), (5) and (6), shall
be transferred or cancelled within three years, provided that the aggregate number of the Shares
held by the Company shall not exceed 10% of the total number of issued Shares of the Company.
For any repurchase of its Shares by the Company, the obligation of information disclosure
shall be fulfilled in accordance with the provisions of the Securities Law. Where the Company
repurchases its Shares under the circumstances described in items (3), (5) and (6) of the aforesaid
provisions, it shall be carried out by open and centralized trade.
POWER OF ANY SUBSIDIARY OF THE ISSUER TO OWN SHARES IN ITS PARENT
Not applicable
DIVIDENDS AND OTHER METHODS OF DISTRIBUTION
The Company’s profit distribution policy is as follows:
(1) the profit distribution of the Company shall maintain continuity and stability, and firmly
attach importance to the actual interests of Shareholders and the long-term interests of
the Company;
(2) proposals related to the adjustment of the profit distribution policy shall be submitted to
the general meeting of the Company for approval after consideration by the Board of
Directors;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 2–


--- page 748 ---
(3) the Company may distribute dividends by way of cash, Shares or a combination of cash
and Shares. When the conditions are met, the Company may also distribute the interim
cash dividends;
(4) The Company’s profit distribution shall not exceed the scope of cumulative distributable
profits and shall not jeopardize the Company’s ability to continue as a going concern.
The Company’s profit distribution plan for each year shall be reviewed and approved at the
general meeting. Upon the resolution on the profit distribution plan made at the general meeting,
the Board of Directors is required to complete the distribution of dividends (or Shares) within two
months after the general meeting.
In distributing the current year’s profit after tax, 10% of the profit shall be allocated to the
Company’s statutory reserve fund. When the aggregate amount of the statutory reserve fund has
reached more than 50% of the Company’s registered capital, further allocations are not required.
If the statutory reserve fund of the Company is insufficient to make up the losses of the
previous year, the profits of the current year shall be used to make up such losses before allocating
to the statutory reserve fund in accordance with the preceding paragraph.
After allocation of its profits after tax to its statutory reserve fund, the Company may allocate
its profits after tax to its discretionary reserve fund upon a resolution of the general meeting.
The remaining profits after tax after the Company has made up its losses and allocated to its
reserve fund may be distributed to its Shareholders in proportion to their shareholdings.
If the Company distributes profits to Shareholders in violation of the provisions of the
Articles of Association, the Shareholders shall return the profits distributed in violation of such
provisions to the Company; and the Shareholders and the Directors, and senior management who
are held accountable for any loss of the Company arising therefrom, shall assume compensation
liabilities.
The Shares held by the Company shall not participate in the distribution of profits.
The Company’s reserve funds shall be used to make up the losses of the Company or expand
the production operations, or be converted to increase the capital of the Company. However, the
capital reserve fund shall not be used to make up the losses of the Company.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 3–


--- page 749 ---
The discretionary reserve fund and statutory reserve fund shall be used first to make up the
Company’s losses; if the losses cannot be covered, the capital reserve fund can be used in
accordance with the regulations.
When the statutory reserve fund is converted into registered capital, the remainder of the fund
shall not be less than 25% of the Company’s registered capital prior to such conversion.
APPOINTMENT OF PROXIES
All Shareholders of the Company, or their proxies, whose names appeared on the register of
members on the record date are entitled to attend the general meeting. Shareholders shall have the
right to speak and vote at the general meeting in accordance with relevant laws, regulations and
the Articles of Association, except where individual Shareholders are required by the Listing Rules
to abstain from voting on individual matters. Pursuant to the applicable laws and regulations and
the listing rules of the stock exchange of the place where the Company’s Shares are listed, where
any Shareholder shall abstain from voting on any particular resolution or is restricted to vote only
for or against such resolution, any vote cast by such Shareholder or proxy thereof in violation of
such requirement or restriction shall not be counted in the voting results.
Any Shareholder may attend the general meeting in person or appoint one or several persons
(who may not be Shareholders) to act as his/her/its proxy to attend and vote at the general meeting
on his/her/its behalf. Any Shareholder or his/her proxy shall be entitled to attend the general
meeting and exercise his/her voting rights in accordance with relevant laws, regulations and the
Articles of Association.
Any Shareholder may attend the general meeting in person or authorize a proxy to attend and
vote at the general meeting on his/her/its behalf.
An individual Shareholder who attends the general meeting in person shall produce his/her
own identity card or other valid documents or proof evidencing his/her identity. Where a
Shareholder intends to appoint a proxy to attend the general meeting on his/her behalf, the proxy
shall produce his/her own valid identity documents and the power of attorney issued by the
Shareholder.
A corporate Shareholder shall designate its legal representative or a proxy appointed by the
legal representative to attend the meeting. If the legal representative attends the meeting, he or she
shall produce his or her own identity card and valid proof of his or her legal representative status.
If a proxy has been appointed to attend the meeting, such proxy shall produce his/her own identity
card and the written power of attorney issued by the legal representative of the corporate
Shareholder according to law.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 4–


--- page 750 ---
A partnership Shareholder shall designate the executive partner (a natural person), a
representative appointed by the executive partner or a proxy appointed by the executive partner or
the representative to attend the meeting. If the executive partner (a natural person), a
representative appointed by the executive partner to attend the meeting, he or she shall produce his
or her own identity card and valid proof of his or her status. If a proxy has been appointed to
attend the meeting, such proxy shall produce his/her own identity card and the written power of
attorney issued by the executive partner or the representative appointed by the executive partner.
The power of attorney issued by Shareholders authorizing others to attend the general
meeting shall include the following contents:
(1) the name of the proxy;
(2) whether he/she has voting rights;
(3) instructions to vote for, against or abstention from voting on each item to be discussed
on the agenda of the general meeting;
(4) date of issuance and validity period of the power of attorney;
(5) signature (or seal) of the principal. If the principal is a corporate Shareholder, the seal
of the legal entity shall be affixed.
It shall be stated clearly in the power of attorney that the proxy of the Shareholder may vote
at his/her own discretion when the Shareholder does not give any instruction.
The proxy of the Shareholder may, pursuant to the instructions of the Shareholder, exercise
(including but not limited to) the following rights: (1) the Shareholder’s right to speak at the
general meeting; (2) the right to demand a poll by himself/herself or jointly with others; (3) the
right to exercise voting rights by a poll, provided that where more than one proxy is appointed, the
proxies may only exercise such voting rights by a poll.
If the Shareholder is an authorized clearing house (or its proxy) as defined by relevant rules
in Hong Kong made from time to time, such Shareholder is entitled to appoint one or more
persons or representatives of the Company it deems suitable to act as its proxy in any general
meeting and creditors’ meeting, provided that, if more than one person is appointed as proxies, the
power of attorney shall state the number and the class of Shares represented by each of the
proxies. The person so authorized can represent the recognized clearing house (or its proxy) to
attend the meeting and exercise the same legal rights (including the rights to speak and vote) as
those entitled by other Shareholders, as if he/she was an individual Shareholder of the Company.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 5–


--- page 751 ---
In the event that the power of attorney is signed by another person authorized by the
principal, the authorization or other authorization instrument shall be notarized, and such notarized
authorization, other authorization instrument and the power of attorney shall be maintained at the
domicile of the Company or at such other locations as specified in the notice regarding the
convening of the meeting.
In the event that a principal is a legal person, its legal representative or such person as
authorized by a resolution of its Board of Directors or other decision-making body may attend the
general meeting in the capacity of a representative.
Where the appointer has deceased, incapacitated to act, withdrawn the appointment or the
power of attorney, or where the relevant shares have been transferred prior to the voting, a vote
given in accordance with the letter of authorization shall remain valid provided that no written
notice of such event has been received by the Company prior to the commencement of the relevant
meeting.
CALLS ON SHARES AND FORFEITURE OF SHARES
Not applicable
INSPECTION OF THE REGISTER OF SHAREHOLDERS
The Company establishes a register of Shareholders based on the vouchers provided by the
securities registration institution, which is sufficient evidence to prove that Shareholders hold the
Company’s Shares. A Shareholder shall enjoy the rights and assume the obligations attached to the
class of Shares he/she holds. Shareholders holding the same class of Shares shall be entitled to the
same rights and assume equal obligations. A register of Shareholders shall contain the following
particulars:
(1) the name and address of each Shareholder;
(2) the class of Shares and number of Shares subscribed by each Shareholder;
(3) if Shares are issued in paper form, the serial numbers of the share certificate;
(4) the date on which each Shareholder acquired the Shares.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 6–


--- page 752 ---
The Company shall sign a share custody agreement with the securities registration institutions
for the purpose of inspecting the information and shareholding changes (including share pledge) of
major Shareholders on a regular basis, in order to be informed of the shareholding structure of the
Company in a timely manner.
The Shareholders have the right to inspect the register of Shareholders of the Company.
QUORUM FOR MEETINGS AND SEPARATE CLASS MEETINGS
Not applicable
RIGHTS OF THE MINORITIES IN RELATION TO FRAUD OR OPPRESSION THEREOF
A Shareholder who individually or jointly holds more than 3% of the Company’s Shares for
over 180 consecutive days may request to inspect the Company’s accounting books and vouchers
by submitting a written request stating the purpose to the Company. If the Company has reasonable
grounds to believe that the Shareholder’s request to inspect the Company’s accounting books and
vouchers serves an improper purpose and may harm the Company’s legitimate interests, it may
refuse the inspection. The Company must respond to the Shareholder in writing within 15 days of
receiving the written request, providing reasons for the refusal. If the inspection is denied, the
Shareholder may file a lawsuit with the people’s court. If a Shareholder requests to inspect or copy
materials related to the Company’s wholly-owned subsidiaries, the provisions of this Article shall
apply thereto.
If a Shareholder requests to inspect or copy the above-mentioned information or materials,
he/she shall provide the Company with written documents evidencing the class and number of the
Shares held by them, and upon verification of his/her status as a Shareholder, the Company shall
provide the Shareholder with such information or materials as required by him/her, and may charge
a reasonable fee for the provision of the copies of the said documents.
The Company may refuse any inspecting or copying request which involves commercial
secrets and sensitive price information on the Company. If a shareholder divulges the above
relevant information after obtaining the information in accordance with the provisions of the
Articles of Association, causing damage to the legitimate interests of the Company, the shareholder
shall be liable for compensation for the relevant losses caused to the Company in accordance with
the law.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 7–


--- page 753 ---
The number of shares held as stipulated in the first paragraph of the foregoing shall be
calculated on the basis of the shares of the Company held by the shareholder on the date when the
shareholder’s request for access is made or, if such date is a non-trading day (as defined in the
Hong Kong Listing Rules, the same hereinafter), the closing of business on the trading day
immediately preceding the date of such request.
If the resolutions of the general meeting and the Board meeting violate laws and
administrative regulations, the Shareholders have the right to request the people’s court to judge
such resolutions to be invalid.
If the convening procedures and voting ways of the general meeting and the Board meeting
violate laws, administrative regulations or the Articles of Association, or the resolutions violate the
Articles of Association, the Shareholders have the right to request the people’s court to cancel the
resolutions within 60 days after the resolutions are made, except for the circumstances where the
convening procedures and voting ways have only minor flaws and there’s no substantial impact on
resolutions.
Shareholders who have not been notified to participate in the general meeting may file a
petition with the people’s court to revoke the resolution within 60 days from the date when they
know or should know that the resolution is made at the general meeting; if they do not exercise the
right to revoke within one year from the date of the resolution, the revoke right shall be
extinguished.
Shareholders individually or jointly holding over 1% of the Company’s Shares for more than
180 consecutive days shall have the right to request the Audit Committee in writing to initiate
litigation before the people’s court against any Director or senior management member for loss of
Company resulting from their violation of any laws, administrative regulations or provisions of the
Articles of Association in the course of performing their duties; Shareholders may request the
Board in writing to bring a legal action against the Audit Committee for the loss of the Company
resulting from their violation of any laws, administrative regulations or provisions of the Articles
of Association in the course of performing the duties.
The Shareholders described in the preceding paragraph may initiate litigation before the
people’s court directly in their own names in the interests of the Company in the event that the
Audit Committee or the Board refuses to initiate legal proceedings after receiving the aforesaid
written request of Shareholders, or fails to initiate such legal proceedings within 30 days on which
such request is received, or in case of emergency where failure to initiate such legal proceedings
immediately will result in irreparable damage to the Company’s interests.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 8–


--- page 754 ---
If any person infringes the lawful rights and interests of the Company, thus causing any
losses to the Company, Shareholders individually or jointly holding over 1% of the Company’s
Shares for more than 180 consecutive days may initiate litigation before the people’s court in
accordance with the provisions of the preceding paragraphs.
If the directors, supervisors or senior management members of a wholly-owned subsidiary of
the Company are involved in any of the above-mentioned circumstances, or if any person infringes
the lawful rights and interests of a wholly-owned subsidiary of the Company and thus causes
losses, Shareholders who are individually or jointly holding over 1% of the Shares of the Company
for more than 180 consecutive days, may request in writing, in accordance with the provisions of
the preceding three paragraphs, that the supervisory committee or the board of directors of the
wholly-owned subsidiary to initiate litigation before the people’s court, or initiate litigation before
the people’s court directly in their own names.
In the event that any Director or senior management member violates laws, administrative
regulations or the Articles of Association to the detriment of the interests of the Shareholders, the
Shareholders may initiate litigation before the people’s court.
If a Director or a senior management member, in the performance of his/her duties, causes
damage to others, the Company shall be liable for compensation; the Director or the senior
management member shall also be liable for compensation if there is intentionality or gross
negligence on his/her part.
Any Controlling Shareholder or actual controller of the Company who instructs a Director
and a senior management member to engage in an act detrimental to the interests of the Company
or its Shareholders shall bear joint and several liability with such Director or senior management
member.
PROCEDURES FOR LIQUIDATION
The Company shall be dissolved upon the occurrence of any of the following events:
(1) the expiration of business term specified in the Articles of Association or the occurrence
of other events of dissolution as stipulated in the Articles of Association;
(2) the dissolution resolved at the general meeting;
(3) dissolution is necessary due to a merger or division of the Company;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 2 9–


--- page 755 ---
(4) the Company’s business license is canceled or revoked or it is ordered to close down
according to the law;
(5) Where the Company runs deep into difficulties in operation and management, its
continuous existence may cause material losses to Shareholders’ interests, and such
difficulties cannot be dealt with in other ways, the Shareholders holding more than 10%
of the voting rights of all Shareholders of the Company may file an application to the
people’s court to dissolve the Company.
The proportion of voting rights stipulated in the preceding item (5) shall be calculated on the
basis of the voting rights corresponding to the shares of the Company held by the shareholder on
the date when such written request is made by such shareholder or if such date is a non-trading
day, the close of the trading day immediately prior to date of such written request.
In the event of occurrence of any event leading to the dissolution of the Company as
stipulated in the preceding paragraph, such dissolution event shall be published on the National
Enterprise Credit Information Publicity System within ten days upon its occurrence. Where the
Company is under the circumstance set forth in items (1) and (2) in the preceding paragraph and
has not yet distributed its property to its Shareholders, the Company may continue its operation by
means of amending the Articles of Association or the resolution made at the general meeting.
Any amendment to the Articles of Association according to the preceding paragraph shall be
approved by more than two-thirds of the voting rights of the Shareholders present at the meeting
of the general meeting.
Where the Company is dissolved in accordance with the provisions of items (1), (2), (4) and
(5) above, a liquidation committee shall be formed within 15 days after the occurrence of the event
of dissolution to deal with matters of the liquidation.
The Directors shall be the Company’s liquidation obligors, and a liquidation committee shall
be formed within 15 days from the date of occurrence of the event of dissolution, to carry out the
liquidation process.
The liquidation committee shall comprise the Directors, unless the Articles of Association
stipulate otherwise or the general meeting resolves to elect other person(s).
If the liquidation obligors fail to fulfill their liquidation obligations in a timely manner and
cause losses to the Company or creditors, they shall be liable for compensation.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 0–


--- page 756 ---
If the Company fails to establish a liquidation committee to carry out liquidation after the
expiry of the time limit or fails to carry out liquidation after establishing the liquidation
committee, the interested parties can apply to the people’s court for appointing relevant persons to
establish the liquidation committee to carry out the liquidation. The people’s court shall accept the
application and organise the liquidation committee to conduct liquidation in a timely manner.
The liquidation committee shall exercise the following functions and powers during the
period of liquidation:
(1) to check the properties of the Company, and to prepare a balance sheet and a list of
property items;
(2) to inform creditors by a notice and an announcement;
(3) to dispose of unfinished business of the Company relating to the liquidation;
(4) to pay up all outstanding taxes and tax arising during the liquidation process;
(5) to clear up claims and debts;
(6) to distribute the remaining properties of the Company after the full settlement of debts;
(7) to represent the Company in civil litigations.
The liquidation committee shall notify the creditors within 10 days from the date of its
establishment, and make an announcement in newspaper(s) designated by the CSRC or the
National Enterprise Credit Information Publicity System within 60 days from the date of its
establishment. Creditors shall, within 30 days after receipt of the notice, or for those who do not
receive the notice, within 45 days from the date of the announcement, declare their claims to the
liquidation committee.
Creditors shall provide explanations on and evidence for their claims upon their declarations
of such claims. The liquidation committee shall record the creditors’ claims.
The liquidation committee shall not pay off any debts to any creditors during the period of
credit declaration.
After checking the properties of the Company, and preparing a balance sheet and a list of
property items, the liquidation committee shall formulate a liquidation plan for the confirmation by
the general meeting or the people’s court.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 1–


--- page 757 ---
The Company’s assets shall be used for repayments in the following sequence: payment of
liquidation expenses, staff wages, social insurance fees and statutory compensation, payment of
outstanding taxes, and payment of the Company’s debts. The Company’s residual assets after
repayment of its debts shall be distributed to its Shareholders according to the proportion of their
shareholdings.
During the liquidation period, the Company continues to exist but the Company shall not
carry out any business activities irrelevant to the liquidation. The Company’s assets shall not be
distributed to its Shareholders prior to repaying debts in accordance with the preceding paragraph.
If the liquidation committee, after checking the Company’s properties and preparing a balance
sheet and a list of property items, finds that the Company’s properties are insufficient to pay off its
debts, it shall file an application to the people’s court for bankruptcy in accordance with the law.
After the people’s court accepts the application for bankruptcy, the liquidation committee
shall transfer all liquidation affairs to bankruptcy administrators appointed by the people’s court.
Upon completion of liquidation of the Company, the liquidation committee shall prepare a
liquidation report, submit the report to the general meeting or the people’s court for confirmation,
and submit the report to the company registration authority and apply for deregistration of the
Company, and publish an announcement relating to the termination of the Company.
Members of the liquidation committee shall perform liquidation duties and owe duties of
loyalty and diligence.
Members of the liquidation committee shall not exploit their positions to accept bribes or to
obtain other illegal income, and not to encroach upon the Company’s properties.
The liquidation committee members shall be liable for damages caused to the Company if
they are negligent in performing their duties. The liquidation committee members shall bear the
liability for compensation if losses are caused to the Company or the creditors due to their
intentional or gross negligence.
The Company declared bankrupt as provided by law shall have bankruptcy liquidation carried
out according to relevant enterprise bankruptcy laws.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 2–


--- page 758 ---
OTHER PROVISIONS MATERIAL TO THE ISSUER OR THE SHAREHOLDERS
General
The Company is a company limited by Shares, with perpetual duration.
All the assets of the Company are divided into Shares of equal value. The Shareholders are
responsible for the Company to the extent of their subscribed Shares, and the Company is
responsible for its debts with all its assets.
From the date on which the Articles of Association come into effect, they shall constitute a
legally binding document regulating the Company’s organization and activities, and the rights and
obligations as between the Company and its Shareholders and among the Shareholders, and shall
have legal binding force on the Company, Shareholders, Directors and senior management
members. According to the Articles of Association, Shareholders can sue Shareholders,
Shareholders can sue Directors, the general manager and other senior management personnel,
Shareholders can sue the Company, and the Company can sue Shareholders, Directors and the
general managers and other senior management personnel.
Increase/decrease of Shares
Subject to the provisions of laws and regulations, upon special resolutions by the general
meeting, the Company may increase its capital on the basis of its business and development needs
by any of the following means:
(1) public offering of Shares;
(2) non-public offering of Shares;
(3) allotting bonus Shares to existing Shareholders;
(4) converting capital reserve into share capital;
(5) other means approved by laws, administrative regulations, provisions of the supervisory
rules of the place where the Company’s Shares are listed, and the relevant state
authorities such as the CSRC.
The Company may reduce its registered capital. The Company shall decrease its registered
capital in accordance with the procedures set forth in the Company Law and other relevant
provisions and the Articles of Association.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 3–


--- page 759 ---
Any increase or decrease in the registered capital of the Company shall not be processed until
it is reviewed and approved by a special resolution of the general meeting.
The Company shall prepare a balance sheet and a list of property items when reducing its
registered capital.
The Company shall notify its creditors within 10 days from the date of the Company’s
resolution for the reduction of its registered capital and make an announcement in newspaper(s) or
the National Enterprise Credit Information Publicity System within 30 days from the date of such
resolution. The creditors shall, within 30 days of receipt of the notice or within 45 days of the date
of the announcement in the case of failure of receipt of the notice, be entitled to require the
Company to repay its debts or to provide a corresponding guarantee for repayment.
The Company’s registered capital after reduction shall not be less than the statutory minimum
amount. When the Company reduces its registered capital, it shall, based on a Shareholder’s
capital contribution or shareholding, reduce the amount of his/her capital contribution or Shares,
unless otherwise stipulated by laws or by the Articles of Association.
If the Company is still in a loss position after covering losses in accordance with the
provisions of the Articles of Association, it may reduce the registered capital to cover the losses. If
the registered capital is reduced to cover the losses, the Company shall not make any distribution
to the Shareholders, nor shall it exempt the Shareholders from the obligations to make capital
contributions or pay up the amounts of Shares.
Where the registered capital is reduced in accordance with the preceding provisions of the
Articles of Association related to the notification of creditors and the provision of guarantees shall
not apply, but it shall be announced in newspaper(s) or the National Enterprise Credit Information
Publicity System within 30 days from the date on which the general meeting made a resolution to
reduce the registered capital.
After the Company reduces its registered capital in accordance with the provisions of the
preceding two paragraphs, it shall not distribute profits until the cumulative amount of the
statutory reserve and the discretionary reserve reaches 50% of the registered capital of the
Company.
If the registered capital is reduced in violation of the provisions of the Articles of
Association, the Shareholders shall return the funds they have received, and the Shareholders shall
restore the capital contributions to the original state if their capital contributions are reduced or
exempted; if losses are caused to the Company, the Shareholders and Directors and senior
management members who are held accountable for the losses shall be liable for compensation.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 4–


--- page 760 ---
The Company shall, in accordance with the law, apply for change in its registration with the
company registration authority where it increases or reduces its registered capital.
Shareholders
The register of Shareholders shall be the sufficient evidence to prove the Shareholders’
holding of the Company’s Shares. A Shareholder shall enjoy the rights and assume the obligations
attached to the class of Shares he/she holds. Shareholders holding the same class of Shares shall be
entitled to the same rights and assume equal obligations.
Shareholders of the Company shall enjoy the following rights:
(1) receiving dividends and other forms of interest distribution in proportion to their
shareholdings;
(2) requesting, convening, presiding over, attending or appointing proxies to attend the
general meeting and exercise corresponding voting rights;
(3) supervising the operation of the Company and making suggestions and inquiries;
(4) transferring, donating or pledging their Shares in accordance with laws, administrative
regulations, and the Articles of Association;
(5) inspecting the Articles of Association, the register of Shareholders, minutes of general
meetings, resolutions of Board meetings, and the financial and accounting reports;
(6) upon termination or liquidation of the Company, participating in the distribution of the
remaining assets of the Company in proportion to the quantity of Shares held by them;
(7) Shareholders who disagree with the resolutions for the merger and division of the
Company made at the general meeting demanding the Company to repurchase their
Shares;
(8) other rights provided by laws, administrative regulations, departmental rules or the
Articles of Association.
The Shareholders of the Company shall assume the following obligations:
(1) to comply with laws, administrative regulations and the Articles of Association;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 5–


--- page 761 ---
(2) to pay subscription monies according to the Shares subscribed and the method of
subscription;
(3) not to withdraw their Shares unless required by laws and regulations;
(4) not to abuse their Shareholders’ rights to jeopardize the interests of the Company or
other Shareholders; and not to abuse the status of the Company as an independent legal
person and the limited liability of Shareholders to jeopardize the interests of any
creditors of the Company;
(5) other obligations imposed by laws, administrative regulations, departmental rules,
regulatory documents, the Hong Kong Listing Rules and the Articles of Association.
Where any Shareholder of the Company abuses the Shareholders’ rights, causing losses to the
Company or other Shareholders, such Shareholder shall be liable for compensation.
Where any Shareholder of the Company abuses the Company’s status as an independent legal
person and the limited liability of Shareholders for the purposes of evading repayment of debts,
thereby materially impairing the interests of the creditors of the Company, such Shareholder shall
be jointly and severally liable for the debts owed by the Company.
Where any Shareholder uses two or more companies under his control to commit the acts
described in the preceding paragraph, each of such companies shall be jointly and severally liable
for the debts owed by any of such companies.
Where any Shareholder holding more than 5% voting Shares of the Company pledges any
Shares held by him/her, he/she shall report the same to the Company in writing on the date of the
said pledge.
The Controlling Shareholders and actual controllers of the Company shall not take advantage
of their relationship with the Company as related parties to compromise the interests of the
Company. If they violate the provisions, causing losses to the Company, they shall be liable for
compensation.
The Controlling Shareholders and actual controllers of the Company have the duty to act in
good faith towards the Company and other Shareholders. The controlling Shareholders shall
exercise their rights as capital contributors in strict compliance with laws, and shall not take
advantage of profit distribution, asset restructuring, external investment, capital appropriation and
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 6–


--- page 762 ---
loan guarantees to jeopardize the lawful rights and interests of the Company and other
Shareholders, nor shall they use their controlling position to jeopardize the interests of the
Company and other Shareholders.
Board of Directors
The Board of Directors exercises the following functions and powers:
(1) convening the general meeting and reporting to the general meeting;
(2) implementing the resolutions adopted at general meetings;
(3) deciding on the Company’s business plans and investment proposals;
(4) formulating profit distribution plans and loss recovery plans of the Company;
(5) formulating plans in respect of any increase or reduction of the registered capital, the
issuance of bonds or other securities, and the listing of the Company;
(6) deciding on, within the authority granted by the general meeting, matters such as
external investments, acquisitions and disposals of assets, asset mortgages, external
guarantees, entrusted wealth management, connected transactions, external donations;
(7) deciding on the establishment of internal management organizations of the Company;
(8) formulating proposals for material acquisitions by the Company, acquisitions of the
Company’s shares or mergers, demergers, dissolutions and changes of the corporate
form of the Company;
(9) deciding on the appointment or dismissal of the general manager of the Company, and to
decide on his remuneration, rewards and penalties; deciding on the appointment or
dismissal of the Company’s senior management members based on the nomination of
the general manager, and deciding on their remuneration, rewards and penalties;
(10) setting up the basic management regime of the Company;
(11) formulating the proposals for any amendment to the Articles of Association;
(12) managing information disclosure of the Company (if any);
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 7–


--- page 763 ---
(13) proposing to the general meeting the appointment or replacement of the accounting
firms which provide auditing services to the Company;
(14) receiving reports from the managers of the Company and reviewing their work;
(15) resolving on the acquisition of the Company’s shares by the Company under the
circumstances stipulated in Article 25(3), (5) and (6) of the Company’s Articles of
Association;
(16) exercising other functions and powers as stipulated by laws, administrative regulations,
departmental rules or the Articles of Association.
Matters beyond the scope of authorization of the general meeting shall be submitted to the
general meeting for consideration.
The Board of Directors of the Company shall establish an Audit Committee and other
relevant special committees such as nomination, remuneration and appraisal committees as needed.
The special committees are accountable to the Board of Directors and perform their duties in
accordance with the Articles of Association and the authorization of the Board of Directors, and
the proposals shall be submitted to the Board of Directors for consideration and decision. The
members of such special committees comprise only Directors. Independent Directors shall account
for the majority in each of the Audit Committee, the Nomination Committee and the Remuneration
and Appraisal Committee and serve as the conveners. The convener of the Audit Committee shall
be an accounting professional. The Board of Directors is responsible for formulating the working
procedures of the special committees and regulating the operation of the special committees.
The Board of Directors of the Company shall make a statement to the general meeting
regarding the non-standard audit opinion issued by the certified public accountant on the
Company’s financial report.
The Board of Directors meets regularly at least four times every year and such meetings shall
be convened by the chairman. All Directors shall be informed in writing 14 days before the
meeting. If an interim Board meeting shall be convened, all Directors shall be informed in writing
2 days before the meeting, except for an emergency or otherwise provided by the Articles of
Association or the Rules of Procedure for the Board of Directors. With the approval of all the
directors of the Company, the above notice time limit may be waived.
Shareholders representing more than 10% of the voting rights, more than one third of the
Directors or the Audit Committee may propose to convene an interim meeting. A Board meeting
shall be convened and presided over by the chairman within 10 days upon receipt of the proposal.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 8–


--- page 764 ---
No Board meeting shall be held unless attended by a majority of Directors. Any resolution
adopted by the Board of Directors shall require affirmative votes by a majority of Directors, unless
otherwise stipulated in the Articles of Association.
When voting on the Board of Directors’ resolutions, one director shall have one vote. Where
there is an equality of votes cast both for and against a resolution, the chairman shall have the
right to cast one more vote.
Where a director has a relationship with any enterprise involved in a resolution to be voted
on at a Board meeting as a related party, such director shall promptly report in writing to the
Board of Directors, and shall not exercise her/his voting rights for that resolution, nor shall she/he
exercise voting rights on behalf of any other director. The Board meeting shall not be held unless
attended by a majority of Directors without relationships with any such enterprise as related
parties, and any resolution made at the meeting must be passed by a majority of Directors without
any such relationship. Where the number of Directors without any such relationship attending the
meeting is less than three, the matter shall be submitted to the general meeting for consideration.
The ways for voting on the Board’s resolution shall be a show of hands, voice vote or ballot.
Interim Board meetings may be convened through telephone conferences, video conferences,
faxes, emails or circulation of written resolutions, provided that the Directors can fully give their
opinions, and shall be signed by the attending Directors. Interim Board meetings may also be
convened on site and by other means simultaneously.
Where an interim Board meeting is held off site, the number of the Directors present is
calculated according to the Directors present in the video, the Directors expressing opinions in the
teleconference, the number of valid votes by means of faxes, emails or circulation of written
resolutions received within the specified period, or the written confirmations submitted by the
Directors after the meetings.
Should any director be unable to sign the minutes at such meeting in a timely manner, such
director shall vote orally and sign the written resolution as soon as possible. The director’s oral
vote shall have the same effect as signing the written resolution, provided that the later written
resolution confirms the oral vote during the meeting. Should the written resolution differ from the
oral vote, the oral vote shall prevail.
If a Board meeting is convened by circulating written resolutions, which means the proposals
are served, separately or in sequence, to a Director for his/her review and resolutions, and the
Director and another Director entrusted by him/her shall state clearly their affirmative or negative
opinions on the resolutions.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 3 9–


--- page 765 ---
Independent non-executive Directors
The Board of Directors comprises three independent non-executive Directors.
The General Manager and other senior management members
Senior management members referred to in the Articles of Association refer to the managers,
the secretary to the Board of Directors, person-in-charge of finance and other senior management
members engaged by the Board of Directors.
The Company shall have one general manager who shall be appointed or dismissed by the
Board of Directors. The General Manager of the Company is a senior management member of the
Company. The Company shall have several deputy general managers, one person-in-charge of
finance and several other senior management members engaged by the Board of Directors. The
above-mentioned persons are senior management members of the Company, who shall be
appointed or dismissed by the Board of Directors.
Any person working with Controlling Shareholders or actual controllers of the Company
other than as a director shall not serve as a senior management member of the Company. Senior
management members of the Company are paid only by the Company and are not paid by the
Controlling Shareholder on its behalf.
The term of office of the General Manager shall be three years, renewable upon
re-appointment.
The General Manager shall be accountable to the Board of Directors and exercise the
following functions and powers:
(1) to be in charge of the production, operation and management of the Company, to arrange
implementation of resolutions of the Board of Directors, and to report to the Board of
Directors;
(2) to organize the implementation of the Company’s annual business plans and investment
plans;
(3) to formulate the Company’s plans for the establishment of its internal management
structure;
(4) to formulate the Company’s basic management system;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 4 0–


--- page 766 ---
(5) to formulate specific regulations of the Company;
(6) to appoint or dismiss the management officers other than those required to be appointed
or dismissed by the Board of Directors;
(7) to decide on matters other than those required to be approved by the general meeting
and the Board of Directors as stipulated in the Articles of Association;
(8) to decide on connected transactions other than those required to be reviewed by the
Board of Directors and the general meeting as stipulated in the Articles of Association;
(9) to exercise other powers and functions conferred by the Articles of Association, working
rules for the General Manager or the Board of Directors.
The General Manager shall attend the meetings of the Board of Directors.
The General Manager may resign before his term of office expires. The specific procedures
and methods for the resignation of the general manager shall be specified in the labor contract
entered into between the General Manager and the Company.
Deputy general managers of the Company shall be nominated by the General Manager and
appointed by the Board of Directors, and deputy general managers shall assist the General
Manager in carrying out his work.
Any senior management member who violates any laws, administrative regulations,
departmental rules or supervisory rules of the place where the Company’s Shares are listed and the
Articles of Association, causing losses to the Company, shall be liable for compensation.
Senior management members of the Company shall faithfully perform their duties and
safeguard the best interests of the Company and all Shareholders. If any senior management
member of the Company causes damage to the interests of the Company and its Shareholders due
to failure in faithfully performing their duties or violation of his/her fiduciary duties, he/she shall
be liable for compensation in accordance with the law.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
–V I - 4 1–


--- page 767 ---
A. FURTHER INFORMATION ABOUT OUR COMPANY AND OUR SUBSIDIARIES
1. Incorporation
Our Company was established as a limited liability company in the PRC on October 16, 2017
and was converted into a joint stock limited company on July 2, 2024 under the laws of the PRC.
As of the Latest Practicable Date, the registered capital of the Company was RMB38,381,330.
Our Company has established a place of business in Hong Kong at 31/F, Tower Two, Times
Square, 1 Matheson Street, Causeway Bay, Hong Kong. Our Company has been registered as a
non-Hong Kong company in Hong Kong under Part 16 of the Companies Ordinance on October
17, 2024 with the Registrar of Companies in Hong Kong. Ms. Au Wing Sze ( ਜ൘་) has been
appointed as authorized representative of our Company for the acceptance of service of process
and notices on behalf of the Company in Hong Kong. The address for service of process is 31/F,
Tower Two, Times Square, 1 Matheson Street, Causeway Bay, Hong Kong.
As we are established in the PRC, our corporate structure and Articles of Association are
subject to the relevant laws and regulations of the PRC. A summary of the relevant provisions of
our Articles of Association is set out in “Appendix VI — Summary of Articles of Association”. A
summary of certain relevant aspects of the laws and regulations of the PRC is set out in “Appendix
V — Summary of Principal Legal and Regulatory Provisions”.
2. Changes in Share Capital of Our Company
On October 16, 2017, our Company was established as a limited liability company under the
laws of the PRC with a registered capital of RMB6,511,000.
On February 1, 2024, the registered share capital of our Company was increased from
RMB38,279,252 to RMB38,381,330.
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.
3. Changes in Share Capital of Our Subsidiaries
A summary of the corporate information and the particulars of our subsidiaries are set out in
Note 15 to the Accountant’s Report as set out in Appendix I to this prospectus.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-1 –


--- page 768 ---
The following subsidiaries have been incorporated within two years immediately preceding
the date of this prospectus:
Name of subsidiary
Place of
incorporation
Date of
incorporation Registered capital
Anhui Xidi Engineering Technology Co.,
Ltd. (ʮ̡ ) .....
PRC June 4, 2024 RMB5,000,000
Guangxi Xidi Intelligent Driving
Technology Co., Ltd. (Ҧ
ʮ̡) ........................
PRC June 5, 2025 RMB40,000,000
Save as disclosed above and in the Accountants’ Report set out in Appendix I to this
Prospectus, there has been no alteration in the share capital of any of the subsidiaries of our
Company within the two years immediately preceding the date of this prospectus.
4. Resolutions of our Shareholders
At the general meetings of the Shareholders held on September 23, 2024, the following
resolutions, among other things, our Shareholders resolved to approve the following:
(a) the issuance by our Company of H Shares with a 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 be more than 15% of the total issued share capital of our Company as enlarged
by the Global Offering, and granting the Underwriters the Over-allotment Option of no
more than 15% of the number of H Shares issued pursuant to the Global Offering;
(c) authorization of the Board to handle matters relating to, among other things, the Global
Offering, the issue and listing of the H Shares;
(d) subject to the completion of the Global Offering, the granting of a general mandate to
the Board to repurchase H Shares issued on the Stock Exchange with an aggregate
number of not exceeding 10% of the number of the total issued H Shares as at the date
of the resolution granting the general mandate;
(e) subject to the completion of the Global Offering, the granting of a general mandate to
the Board to allot and issue Shares at any time within a period up to the date of the
conclusion of the next annual general meeting of the Shareholders or the date on which
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-2 –


--- page 769 ---
the Shareholders pass a special resolution to revoke or change such mandate, whichever
is earlier, upon such terms and conditions and for such purposes and to such persons as
the Board in their absolute discretion deem fit, and to make necessary amendments to
the Articles of Association, provided that, the number of Shares to be issued shall not
exceed 20% of the number of the Shares in issue as at the date of the resolution
granting the general mandate; and
(f) subject to the completion of the Global Offering, the conditional adoption of the Articles
of Association, which shall become effective on the Listing Date and the authorization
of the Board to amend the Articles of Association in accordance with relevant laws and
regulations and upon the request from the Stock Exchange and relevant PRC regulatory
authorities.
B. FURTHER INFORMATION ABOUT OUR BUSINESS
1. Summary of Material Contracts
We have entered into the following contracts (not being contracts entered into in the ordinary
course of business) within the two years immediately preceding the date of this prospectus that are
or may be material:
(a) a cornerstone investment agreement dated December 9, 2025 entered into among our
Company, Hunan Xiangjiang Zhicheng Industrial Investment Fund Partnership (Limited
Partnership) (ΥྫΆุ (Υྫ)), China International
Capital Corporation Hong Kong Securities Limited, China Securities (International)
Corporate Finance Company Limited, Ping An of China Capital (Hong Kong) Company
Limited and Ping An Securities (Hong Kong) Company Limited, with respect to a
subscription of Shares at the Offer Price in the aggregate amount of HK$430,000,000
(after deduction of brokerage commissions and levies that the investor will pay in
respect of investor shares);
(b) a cornerstone investment agreement dated December 9, 2025 entered into among our
Company, Nanning Zhijia No. 1 Ruiyue Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ (Υྫ)), China International
Capital Corporation Hong Kong Securities Limited, China Securities (International)
Corporate Finance Company Limited, Ping An of China Capital (Hong Kong) Company
Limited and Ping An Securities (Hong Kong) Company Limited, with respect to a
subscription of Shares at the Offer Price in the aggregate amount of RMB70,000,000;
(c) a cornerstone investment agreement dated December 9, 2025 entered into among our
Company, ICBC UBS Asset Management Company Limited (ʮ̡),
China International Capital Corporation Hong Kong Securities Limited, China Securities
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-3 –


--- page 770 ---
(International) Corporate Finance Company Limited, Ping An of China Capital (Hong Kong)
Company Limited and Ping An Securities (Hong Kong) Company Limited, with respect to a
subscription of Shares at the Offer Price in the aggregate amount of US$1,000,000;
(d) a cornerstone investment agreement dated December 9, 2025 entered into among our
Company, ICBC UBS Asset Management (International) Company Limited (༟
ପ၍ଣ(਷ყ)ʮ̡), China International Capital Corporation Hong Kong Securities
Limited, China Securities (International) Corporate Finance Company Limited, Ping An
of China Capital (Hong Kong) Company Limited and Ping An Securities (Hong Kong)
Company Limited, with respect to a subscription of Shares at the Offer Price in the
aggregate amount of US$2,000,000;
(e) a cornerstone investment agreement dated December 9, 2025 entered into among our
Company, Qianhai Kaiyuan Fund Management Co., Ltd. (ʮ̡ )
(on behalf of Qianhai Kaiyuan Qunwei QDII Single Asset Management Plan (ऎක๕
໊ᙯQDIIྌ )), China International Capital Corporation Hong Kong
Securities Limited, China Securities (International) Corporate Finance Company
Limited, Ping An of China Capital (Hong Kong) Company Limited and Ping An
Securities (Hong Kong) Company Limited, with respect to a subscription of Shares at
the Offer Price in the aggregate amount of HK$20,000,000; and
(f) the Hong Kong Underwriting Agreement.
2. Intellectual Property Rights
(a) Trademarks
As at 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
Registered
Owner Class
Registration
number Registration date Expiry date
1.
 PRC Our Company 9 37530790 September 28,
2020
September 27,
2030
2.
 PRC Our Company 12 52769990 May 7, 2022 May 6, 2032
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-4 –


--- page 771 ---
No. Trademark
Place of
registration
Registered
Owner Class
Registration
number Registration date Expiry date
3.
 PRC Our Company 7 60013481 July 7, 2022 July 6, 2032
4.
 PRC Our Company 11 72483953 January 14,
2024
January 13,
2034
5.
 PRC Our Company 38 72486610 January 14,
2024
January 13,
2034
6.
 PRC Our Company 39 72463424 January 14,
2024
January 13,
2034
7.
 PRC Our Company 9 56123609 December 7,
2021
December 6,
2031
8.
 PRC Our Company 42 59391146 November 14,
2022
November 13,
2032
9.
 PRC Our Company 7 56890578 December 21,
2021
December 20,
2031
10.
 PRC Our Company 35 56130252 December 14,
2021
December 13,
2031
11.
 PRC Our Company 37 56111854 December 7,
2021
December 6,
2031
12.
 PRC Our Company 38 56118123 December 7,
2021
December 6,
2031
13.
 PRC Our Company 9 75079323 September 21,
2024
September 30,
2034
14.
 PRC Our Company 12 72461340 January 14,
2024
January 13,
2034
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-5 –


--- page 772 ---
No. Trademark
Place of
registration
Registered
Owner Class
Registration
number Registration date Expiry date
15.
 PRC Our Company 9 59523974 March 14,
2022
March 13,
2032
16.
 PRC Our Company 12 59498363 March 14,
2022
March 13,
2032
17.
 PRC Our Company 42 59502299 March 14,
2022
March 13,
2032
18.
 PRC Our Company 12 59506375 March 14,
2022
March 13,
2032
19.
 PRC Our Company 12 54017790 September 21,
2021
September 20,
2031
20.
 PRC Our Company 35 72465767 January 14,
2024
January 13,
2034
21.
 PRC Our Company 9 72483512 December 28,
2023
December 27,
2033
22.
 PRC Our Company 12 72482403 January 7,
2024
January 6,
2034
23.
 PRC Our Company 42 72480170 January 7,
2024
January 6,
2034
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-6 –


--- page 773 ---
No. Trademark
Place of
registration
Registered
Owner Class
Registration
number Registration date Expiry date
24.
 PRC Our Company 7 61410552 September 21,
2022
September 20,
2032
25.
 PRC Our Company 9 61419929 September 21,
2022
September 20,
2032
26.
 PRC Our Company 12 61412635 September 28,
2022
September 27,
2032
27.
 PRC Our Company 42 61434307 September 21,
2022
September 20,
2032
28.
 PRC Our Company 7 71996048 November 21,
2023
November 20,
2033
29.
 PRC Our Company 9 71996054 November 21,
2023
November 20,
2033
30.
 PRC Our Company 12 71998628 November 28,
2023
November 27,
2033
31.
 PRC Our Company 42 71989937 November 21,
2023
November 20,
2033
(b) Copyrights
As at the Latest Practicable Date, we had registered the following software copyrights which
we consider to be or may be material to our business:
No. Copyright Version Place of registration Registration number Registration date
1. V2X Vehicle Networking Software (V2X ԓᑌ
ၣழ΁) ....................
V2.2.1 PRC 2019SR0466010 May 15, 2019
2. V2X Vehicle-Road Coordination System (V2X
ԓ༩՘Νӻ୕ ) .................
V1.0 PRC 2019SR1152170 November 11,
2019
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-7 –


--- page 774 ---
No. Copyright Version Place of registration Registration number Registration date
3. CIDI Vehicle Remote Driving Software (CIDI
ԓሿჃ೻ቷትழ΁ ) ..............
V1.0 PRC 2020SR0461417 May 15, 2020
4. Positioning System Online Analysis Tool
Software (ʈՈழ΁ )....
V1.0 PRC 2021SR0181930 February 2, 2021
5. Intelligent Perception System Framework
Software (ழ΁ ) ......
V2.0 PRC 2021SR0551246 April 19, 2021
6. Adaptive Panorama APP Software ( ІቇᏐΌ౻
APPழ΁) ...................
V1.0.1 PRC 2021SR0852701 June 8, 2021
7. CIDI Control Calibration Data Automatic
Processing System (CIDIᅰኽІਗ
ஈଣӻ୕) ...................
V1.0 PRC 2022SR0207329 February 9, 2022
8. Smart Bus Passenger Screen App (࠱
܈܄App) ....................
V3.2.44 PRC 2022SR0639150 May 25, 2022
9. Digital Traffic System Platform ( ᅰοʹஷӻ୕
̨̻) ......................
V1.0 PRC 2022SR0651150 May 26, 2022
10. Intelligent Connected Data Management
Platform ( ౽ঐၣᑌᅰኽ၍ଣ̨̻ ) ......
V1.0 PRC 2022SR0764911 June 16, 2022
11. Intelligent Connected Cloud Platform ( ౽ঐၣ
ᑌථ̨̻) ...................
V1.0 PRC 2022SR0765019 June 16, 2022
12. cidi-rivz Intelligent Driving Monitoring
Software (cidi-rivz ౽ቷ္છழ΁ ) .......
V1.0 PRC 2022SR0997879 August 3, 2022
13. Underground Mine Truck Remote Monitoring
System ( ʜɨᘤ̔Ⴣ೻္છӻ୕ ) .......
V1.0 PRC 2022SR1328967 August 30, 2022
14. Roadside Millimeter Wave Radar System
Management Software (ཤ༺ӻ୕
၍ଣழ΁) ...................
V1.0 PRC 2023SR0157959 January 30, 2023
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-8 –


--- page 775 ---
No. Copyright Version Place of registration Registration number Registration date
15. Vehicle-Road Coordination Integrated
Perception Edge Computing Software ( ԓ༩
ၑழ΁ ) .........
V1.0 PRC 2023SR0202756 February 6, 2023
16. Control Algorithm Evaluation Index Scoring
Software (ᅺ൙ʱழ΁ )....
V1.0 PRC 2023SR0394791 March 24, 2023
17. Smart Logistics App Software (ݴيAppழ
΁) .......................
V2.2.3 PRC 2023SR1245909 October 17, 2023
18. Vehicle Status Monitoring Platform Software
(࿒္છ̨̻ழ΁ ) ...........
V1.0 PRC 2024SR0402306 March 18, 2024
19. CIDI Intelligent Driving Active Bus Priority
Simulation Software (౽ቷ˴ਗʮʹᎴ΋
ͷॆழ΁) ...................
V1.0 PRC 2024SR0838409 June 20, 2024
(c) Patents
As at the Latest Practicable Date, we had registered the following patents which we consider
to be or may be material to our business:
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
1. Space measuring method,
space measuring device,
electronic equipment and
computer storage medium
(eༀໄeཥ
ၑዚπᎷʧ
ሯ) .............
Invention
patent
Our Company PRC 2021101071127 May 25, 2021 January 27,
2041
2. Monitoring component
control method and
device, vehicle, equipment
and computer storage
medium ( ္಻ଡ଼΁છՓ˙
eༀໄeԓሿeண௪ʿ
ၑዚπᎷʧሯ ) .....
Invention
patent
Our Company PRC 2021102381578 July 9, 2021 March 4, 2041
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-9 –


--- page 776 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
3. Method, apparatus, and
device for detecting
object, and computer
storage medium ( ࿁൥Ꮸ಻
ၑ
ዚπᎷʧሯ ) ........
Invention
patent
Our Company PRC 2021105255492 August 20,
2021
May 14, 2041
4. Filter control method,
device, equipment, and
computer storage medium
(eༀໄe
ၑዚπᎷʧሯ ) ..
Invention
patent
Our Company PRC 2021104159820 September 10,
2021
April 19, 2041
5. Road information processing
method, road side unit,
vehicle-mounted device
and storage medium ( ༸༩
e༩ਉఊʩ
eԓ༱ༀໄʿπᎷʧሯ ) ..
Invention
patent
Our Company PRC 2018115692037 December 7,
2021
December 21,
2038
6. Vehicle visual range
expansion method, device
and system and computer
equipment ( ԓሿൖᙂᇍఖ
eༀໄeӻ୕ձ
ၑዚண௪ ) ........
Invention
patent
Our Company PRC 2019102964926 February 8,
2022
April 13, 2039
7. Stereo matching optimization
method and device,
computer equipment and
storage medium ( ͭ᜗ʸৣ
ၑዚ
ண௪ձπᎷʧሯ ) .....
Invention
patent
Our Company PRC 201910729550X March 18,
2022
August 8,
2039
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-10 –


--- page 777 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
8. Vehicle-mounted LiDAR
external parameter
calibration method,
computer equipment, and
storage medium ( ԓ༱ዧΈ
ၑ
ዚண௪ʿπᎷʧሯ ) ....
Invention
patent
Our Company PRC 201811389515X April 19, 2022 November 21,
2038
9. Radar data fusion method,
device and system ( ཤ༺ᅰ
eༀໄʿӻ
୕) .............
Invention
patent
Our Company PRC 2018114147419 May 20, 2022 November 26,
2038
10. Cleaning control method and
device of sensing
equipment, vehicle and
cleaning control system of
vehicle (૶ᆎ
eༀໄeԓሿʿ
Չ૶ᆎછՓӻ୕ ) .....
Invention
patent
Our Company PRC 2019108651501 June 28, 2022 September 12,
2039
11. Road safety early warning
method and device, road
side unit and storage
medium ( ༸༩τΌཫᙆ˙
eༀໄe༩ਉఊʩʿπ
Ꮇʧሯ) ..........
Invention
patent
Our Company PRC 2019100 111115 July 22, 2022 January 7,
2039
12. Composite test system and
method ( ɓ၇ልΥ಻༊ӻ
ج).........
Invention
patent
Our Company PRC 2019104655683 August 26,
2022
May 30, 2039
13. Obstacle processing method
and device and traveling
equipment (ஈଣ˙
eༀໄձБትண௪ ) ...
Invention
patent
Our Company PRC 2021103815786 October 14,
2022
April 9, 2041
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-11 –


--- page 778 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
14. Three-dimensional
laser-based method and
device for detecting lifting
prevention of container
truck and computer
equipment (ɧၪዧΈ
e
ၑዚண௪ ) ....
Invention
patent
Our Company PRC 2020101577952 November 29,
2022
March 9, 2040
15. Automatic reversing control
method, device, intelligent
driving equipment, and
storage medium (ԓ
eༀໄe౽ঐБ
ትண௪ձπᎷʧሯ ) ....
Invention
patent
Our Company PRC 2020112238726 November 25,
2022
November 5,
2040
16. Control method and device
for multi-axle distributed
electric drive axle in
vehicle ( ԓሿʕε዗ʱб
ၾ
ༀໄ) ............
Invention
patent
Our Company PRC 2020100706903 November 29,
2022
January 21,
2040
17. Target tracking method,
device, computer-readable
storage medium, and
computer equipment ( ͦᅺ
ၑዚ
ၑዚ
ண௪) ............
Invention
patent
Our Company PRC 2018110612619 November 29,
2022
September 12,
2038
18. Vehicle arrival time
prediction method, device,
equipment and computer
storage medium ( ԓሿՑ༺
eༀໄeண
ၑዚπᎷʧሯ ) ...
Invention
patent
Our Company PRC 202 1111466397 November 29,
2022
September 28,
2041
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-12 –


--- page 779 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
19. Vehicle control method,
device, computer-readable
storage medium, and
vehicle ( ɓ၇ԓሿછՓ˙
ၑዚ̙ᛘπ
Ꮇʧሯʿԓሿ ) .......
Invention
patent
Our Company PRC 2021103830269 November 29,
2022
April 9, 2041
20. Blind area detection method,
vehicle-mounted unit, road
side unit, vehicle and
storage medium (ਜઞ಻
eԓ༱ఊʩe༩ਉఊ
ʩeԓሿʿπᎷʧሯ ) ...
Invention
patent
Our Company PRC 2019100023186 December 16,
2022
January 2,
2039
21. Multi-train hinge angle zero
calibration method and
device and computer
equipment ( εΐԓდટԉ
ࠇ
ၑዚண௪) .........
Invention
patent
Our Company PRC 2020101305869 April 7, 2023 February 28,
2040
22. Dense target detection
method and device,
storage medium and
computer equipment ( ੗ණ
eༀໄeπ
ၑዚண௪ ) ...
Invention
patent
Our Company PRC 2020101998557 March 21,
2023
March 20,
2040
23. Object bounding box
determination method,
device, computer
equipment, and readable
storage medium (࣪
ၑዚ
ண௪ձ̙ᛘπᎷʧሯ ) ...
Invention
patent
Our Company PRC 2018111008217 March 21,
2023
September 20,
2038
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-13 –


--- page 780 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
24. Training method for
positioning model and
point cloud data
positioning method and
device (৅ᇖ˙
ʿ
ༀໄ) ............
Invention
patent
Our Company PRC 2022115065499 April 28, 2023 November 29,
2042
25. Obstacle detection method,
vehicle, apparatus, and
computer storage medium
(eԓሿe
ၑዚπᎷʧሯ ) ..
Invention
patent
Our Company PRC 2021103065544 May 2, 2023 March 23,
2041
26. Vehicle driving assisting
method, device, computer
equipment and storage
medium ( ԓሿႾпቷት˙
ၑዚண௪ձ
πᎷʧሯ) .........
Invention
patent
Our Company PRC 2019104817673 June 13, 2023 June 4, 2039
27. Intelligent vehicle and early
warning control method,
device, system and storage
medium thereof ( ౽ঐԓሿ
eༀໄ
eӻ୕ʿπᎷʧሯ ) ....
Invention
patent
Our Company PRC 2019101084223 June 13, 2023 January 18,
2039
28. Beyond line-of-sight
panoramic image
acquisition method,
device, medium,
equipment, and system ( ൴
e
ༀໄeʧሯeண௪ʿ
ӻ୕) ............
Invention
patent
Our Company PRC 2019102962206 June 13, 2023 April 13, 2039
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-14 –


--- page 781 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
29. Vehicle driving position
determination method,
device, storage medium,
and computer equipment
(e
ၑዚ
ண௪) ............
Invention
patent
Our Company PRC 2019108081122 June 13, 2023 August 29,
2039
30. Carriage loadable space
detection method and
device based on
three-dimensional laser ( ਿ
ԓా̙ༀ༱
ձༀໄ ) ...
Invention
patent
Our Company PRC 2020102360219 July 14, 2023 March 30,
2040
31. Information processing
method, apparatus, and
computer storage medium
(ࠇ
ၑዚπᎷʧሯ ) .......
Invention
patent
Our Company PRC 2021105143603 July 18, 2023 May 8, 2041
32. Intersection traffic
coordination method and
device ( ʹɸ༩ɹஷБ՘ሜ
ձༀໄ ) ........
Invention
patent
Our Company PRC 2020112826963 July 14, 2023 November 17,
2040
33. Method and device for
detecting anti-smashing of
integrated card based on
three-dimensional laser
and computer equipment
(ණ̔ԣौ
ၑዚ
ண௪) ............
Invention
patent
Our Company PRC 202010158561X May 26, 2023 March 9, 2040
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-15 –


--- page 782 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
34. Obstacle detection method,
device, equipment and
computer storage medium
(eༀໄe
ၑዚπᎷʧሯ ) ..
Invention
patent
Our Company PRC 2021102646051 July 18, 2023 March 11,
2041
35. Obstacle detection method,
device, equipment and
computer storage medium
(eༀໄe
ၑዚπᎷʧሯ ) ..
Invention
patent
Our Company HK 420210429114 November 17,
2023
March 11,
2041
36. Positioning method, device,
equipment, readable
storage medium, and
program product (З˙
eༀໄeண௪e̙ᛘπ
ۜ) ....
Invention
patent
Our Company PRC 2023101091863 July 18, 2023 February 14,
2043
37. Target detection method,
target detection device,
computer equipment and
storage medium ( ͦᅺᏨ಻
ၑዚண௪
ձπᎷʧሯ ) ........
Invention
patent
Our Company PRC 2018114415111 July 18, 2023 November 29,
2038
38. Multi-sensor target detection
method, device, computer
equipment, and storage
medium ( εෂชኜͦᅺᏨ
ၑዚண
௪ձπᎷʧሯ ) .......
Invention
patent
Our Company PRC 2018115605255 July 18, 2023 December 20,
2038
39. Unmanned loading guiding
method, device and system
(ɓ၇ೌɛቷትༀ༱ኬˏ˙
eༀໄձӻ୕ ) .....
Invention
patent
Our Company PRC 2019100026790 July 14, 2023 January 2,
2039
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-16 –


--- page 783 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
40. Obstacle classification
method, obstacle
classification device,
storage medium and
computer equipment ( ღᖟ
eༀໄeπᎷ
ၑዚண௪ ) ....
Invention
patent
Our Company PRC 2018115627413 July 28, 2023 December 20,
2038
41. Autonomous driving
assistance positioning
method, device,
equipment, and storage
medium (֛
eༀໄeண௪ձπ
Ꮇʧሯ) ..........
Invention
patent
Our Company PRC 2018113542001 September 26,
2023
November 14,
2038
42. LiDAR external parameter
calibration method, device,
equipment, medium, and
product (̮ਞ
eༀໄeண௪e
ۜ) ........
Invention
patent
Our Company PRC 202310464282X September 12,
2023
April 26, 2043
43. Priority passage control
method and device,
roadside equipment, and
traffic signal control
equipment ( Ꮄ΋ஷБછՓ
ၾༀໄe༩ਉண௪ձ
໮છՓண௪ ) ....
Invention
patent
Our Company PRC 2021102227645 September 26,
2023
February 26,
2041
44. Vehicle articulation point
coordinate calibration
method, device, computer
equipment, and storage
medium ( ԓሿდટᓃѬᅺ
ၑዚ
ண௪ձπᎷʧሯ ) .....
Invention
patent
Our Company PRC 2019109859028 September 26,
2023
October 17,
2039
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-17 –


--- page 784 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
45. Ground segmentation method
and device based on
stereoscopic vision,
vehicle-mounted
equipment and storage
medium (ٙ
eༀໄeԓ
༱ண௪ʿπᎷʧሯ ) ....
Invention
patent
Our Company PRC 2019101900185 September 26,
2023
March 13,
2039
46. Vehicle-road cooperative
communication method
and device, traffic signal
control equipment and
road side equipment ( ԓ༩
ၾༀໄeʹ
໮છՓண௪ձ༩ਉ
ண௪) ............
Invention
patent
Our Company PRC 2021102227128 September 22,
2023
February 26,
2041
47. Vehicle priority passage
control method and related
equipment ( ɓ၇ԓሿᎴ΋
ᗫ
ண௪) ............
Invention
patent
Our Company PRC 2021102227630 September 26,
2023
February 26,
2041
48. Method and device for
determining road drivable
area and computer
equipment ( ༸༩̙Бትਜ
eༀໄʿ
ၑዚண௪ ) ........
Invention
patent
Our Company PRC 2018115627432 September 26,
2023
December 20,
2038
49. Panoramic all-around view
image generation method
of vehicle and related
equipment (Ό౻ᐑ
ᗫ
ண௪) ............
Invention
patent
Our Company Japan 2022-535119 August 21,
2023
December 16,
2040
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-18 –


--- page 785 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
50. Dump truck and control
method, computer-readable
storage medium ( І՝ԓʿ
ၑዚ̙ᛘ
πᎷʧሯ) .........
Invention
patent
Our Company PRC 2018101396729 September 22,
2023
February 9,
2038
51. Positioning data optimization
method thereof and
computer readable storage
medium (ЗᅰኽᎴʷ
eༀໄeཥɿண௪ձ
̙ᛘπᎷʧሯ ) .......
Invention
patent
Our Company PRC 2023110018602 October 24,
2023
August 10,
2043
52. Right of way allocation
method, device, equipment
and medium ( ஷБᛆʱৣ
eༀໄeண௪˸ʿ
ʧሯ) ............
Invention
patent
Our Company PRC 2024108219097 December 13,
2024
June 23, 2044
53. Dump truck, control method
thereof and computer
readable storage medium
(e
ၑዚ̙ᛘπᎷʧሯ ) ...
Invention
patent
Our Company PRC 2018101394070 January 2,
2024
February 9,
2038
54. Driving behavior detection
method, device and system
and storage medium ( ቷት
eༀໄe
ӻ୕ʿπᎷʧሯ ) .....
Invention
patent
Our Company PRC 2018115325451 December 1,
2023
December 14,
2038
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-19 –


--- page 786 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
55. External parameter
calibration method and
device for multi-group 3D
camera group, storage
medium and equipment
(εଡ଼3D̮ਞᅺ
eༀໄeπᎷʧሯ
ʿண௪) ..........
Invention
patent
Our Company PRC 2019103797456 December 29,
2023
May 8, 2039
56. Point cloud searching
method and device and
terminal equipment ( ɓ၇
eༀໄʿ
୞၌ண௪) .........
Invention
patent
Our Company PRC 2023109713893 December 29,
2023
August 3,
2043
57. Obstacle detection method,
device, and terminal
equipment (Ꮸ
eༀໄʿ୞၌
ண௪) ............
Invention
patent
Our Company PRC 2023109171419 January 5,
2024
July 25, 2043
58. Obstacle detection method,
device, equipment and
storage medium for rail
vehicle (ٙ
eༀໄe
ண௪ʿπᎷʧሯ ) .....
Invention
patent
Our Company PRC 2023107876646 December 1,
2023
June 30, 2043
59. Dynamic lane management
method and device,
terminal equipment and
storage medium ( ɓ၇ਗ࿒
eༀໄe
୞၌ண௪ʿπᎷʧሯ ) ...
Invention
patent
Our Company PRC 2021105215921 March 29,
2024
May 13, 2041
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-20 –


--- page 787 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
60. Lane line recognition
method, device, computer
equipment and storage
medium (ج
ၑዚண௪ձ
πᎷʧሯ) .........
Invention
patent
Our Company PRC 2019106400551 February 25,
2025
July 15, 2039
61. Binocular camera external
parameter verification
method, device, computer
equipment, and storage
medium (ዚ̮ਞᏨ
ၑዚண
௪ձπᎷʧሯ ) .......
Invention
patent
Our Company PRC 2019109311371 April 19, 2024 September 29,
2039
62. Vehicle steering control
method, device, vehicle,
and storage medium ( ԓሿ
eༀໄeԓ
ሿձπᎷʧሯ ) .......
Invention
patent
Our Company PRC 2021103594961 April 26, 2024 April 2, 2041
63. Vehicle formation control
method, vehicle, device
and computer storage
medium ( ԓሿᇜඟછՓ˙
ၑዚ
πᎷʧሯ) .........
Invention
patent
Our Company PRC 202110264729X April 2, 2024 March 11,
2041
64. Vehicle management method,
apparatus, device, and
computer storage medium
(eༀໄeண
ၑዚπᎷʧሯ ) ...
Invention
patent
Our Company PRC 2020115493223 April 2, 2024 December 24,
2040
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-21 –


--- page 788 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
65. Visual information fusion
processing method, device
and storage medium based
on vehicle-road
collaboration (ԓ༩՘
ፄΥஈଣ˙
eༀໄʿπᎷʧሯ ) ...
Invention
patent
Our Company PRC 2019102676153 January 28,
2025
April 2, 2039
66. Relative pose calibration
method, device, computer
equipment and storage
medium (˙
ၑዚண௪ձ
πᎷʧሯ) .........
Invention
patent
Our Company PRC 202010614019.0 May 28, 2024 June 30, 2040
67. Point cloud clustering
method, device, computer
equipment, and storage
medium (e
ၑዚண௪ձπᎷ
ʧሯ) ............
Invention
patent
Our Company PRC 2019104211235 June 11, 2024 May 20, 2039
68. Method, device, computer
device and storage
medium for driving
formation vehicle ( ᇜඟԓ
ၑ
ዚண௪ձπᎷʧሯ ) ....
Invention
patent
Our Company PRC 2020108121052 June 21, 2024 August 13,
2040
69. Target detection and model
training method, device,
computer equipment and
storage medium ( ͦᅺᏨ಻
eༀໄe
ၑዚண௪ձπᎷʧሯ ) ..
Invention
patent
Our Company PRC 201910406367.6 June 18, 2024 May 16, 2039
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-22 –


--- page 789 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
70. Intelligent driving system,
method, and
computer-readable storage
medium ( ౽ঐቷትӻ୕e
ၑዚ̙ᛘπᎷ
ʧሯ) ............
Invention
patent
Our Company PRC 201810371209.7 June 14, 2024 April 25, 2038
71. Vehicle lane changing
method, device, equipment
and computer storage
medium (e
ၑዚπᎷ
ʧሯ) ............
Invention
patent
Our Company PRC 202110321172.9 June 18, 2024 March 25,
2041
72. Intelligent vehicle,
intelligent semi-trailer
control system and control
method thereof ( ౽ᅆԓሿ
છՓӻ୕
ج) .......
Invention
patent
Our Company PRC 2017114401538 February 18,
2025
December 25,
2037
73. Vehicle mass estimation
method and device,
electronic equipment and
storage medium ( ዆ԓሯඎ
eༀໄeཥɿண
௪ձπᎷʧሯ ) .......
Invention
patent
Our Company PRC 2019102232400 November 30,
2021
March 22,
2039
74. Vehicle travel state control
method, apparatus,
computer device, and
storage medium ( ԓሿБት
ࠇ
ၑዚண௪ձπᎷʧሯ ) ...
Invention
patent
Our Company PRC 2019101885876 May 25, 2021 March 13,
2039
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-23 –


--- page 790 ---
No. Patent name Type Patentee
Place of
registration Patent number Grant date Expiry Date
75. Method and device for
vehicle to avoid obstacle,
electronic equipment and
storage medium ( ԓሿᒒක
ʿༀໄeཥ
ɿண௪ձπᎷʧሯ ) ....
Invention
patent
Our Company PRC 2018115562531 July 9, 2021 December 19,
2038
76. Parking trajectory generation
method and device,
computer equipment and
storage medium (༦
ၑዚ
ண௪ձπᎷʧሯ ) .....
Invention
patent
Our Company PRC 202010402570.9 September 27,
2024
May 13, 2040
77. Panoramic all-around view
image generation method
of vehicle and related
equipment (Ό౻ᐑ
ᗫ
ண௪) ............
Invention
patent
Our Company PRC 2019112898189 April 3, 2020 December 16,
2039
3. Domain names
As at the Latest Practicable Date, we owned the following domain names which we consider
to be or may be material to our business:
No. Domain Name Registered Owner Registration date Expiry Date
1. novodriv.net ........ Our Company May 11, 2017 May 11, 2026
2. metamine.cn ........ Our Company September 27, 2021 September 27, 2026
3. novodriv.co ......... Our Company May 1, 2017 May 1, 2026
4. cidiguardian.com ..... Our Company July 25, 2024 July 25, 2026
5. vessel2x.cn ......... Our Company March 9, 2023 March 9, 2026
6. novodriv.com ....... Novodriv Chongqing May 1, 2017 May 1, 2026
7. cidiserver.com ....... Our Company July 17, 2018 July 17, 2026
8. autosoftware.cn ...... Our Company March 16, 2023 March 16, 2026
9. csznjsyjy.cn ........ Our Company April 29, 2020 April 29, 2026
10. vessel2x.com ....... Our Company March 9, 2023 March 9, 2026
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-24 –


--- page 791 ---
Save as aforesaid, as of the Latest Practicable Date, there were no other trade or service
marks, patents, intellectual or industrial property rights which were material in relation to our
business.
C. FURTHER INFORMATION ABOUT OUR DIRECTORS AND SENIOR MANAGEMENT
1. Disclosure of interests of Directors and Chief Executive of the Company
Save as disclosed below, immediately following the completion of the Global Offering
(assuming the Over-allotment Option is not exercised), so far as our Directors are aware, none of
our Directors or chief executive has any interests or short positions in our Shares, underlying
Shares and debentures of our Company or its associated corporations (within the meaning of Part
XV of the SFO) which will have to be notified to our Company and the Stock Exchange pursuant
to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which he or
she is 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 recorded in the register referred to therein, or which will
be required to be notified to our Company and the Stock Exchange pursuant to the Model Code for
Securities Transactions by Directors of Listed Companies contained in the Listing Rules.
(a) Interest in our Company
Name of Director or
chief executive Position Nature of Interest (1)
Number of
Unlisted/
H Shares
Approximate
percentage of
shareholding
in the total
issued Shares
immediately
prior to the
Global
Offering
Approximate
percentage of
shareholding
in the total
issued Shares
immediately
after the
Global
Offering (2)
Approximate
percentage of
shareholding
i nHS h a r e s
immediately
after the
Global
Offering (2)
Prof. Li (3) ..... Founder, chairman of
the Board and
non-executive
Director
Interest in controlled
corporations
16,750,130
H Shares
43.64% 38.25% 39.46%
Dr. Hu Albert
Sibo
(4) .....
Executive Director
and chief
executive officer
Beneficial interest 138,270
H Shares
0.36% 0.32% 0.33%
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-25 –


--- page 792 ---
Notes:
(1) All interests stated are long position.
(2) The calculation is based on the total number of 1,345,418 Domestic Unlisted Shares in issue, 37,035,912 H Shares
to be converted from Domestic Unlisted Shares in issue and 5,407,980 H Shares to be issued pursuant to the Global
Offering (assuming the Over-allotment Option is not exercised).
(3) Under the SFO, Prof. Li is deemed to be interested in (i) the 11,443,151 Shares held by NovoDriv HK, the general
partner of which is NovoDriv Limited, which in turn is wholly-owned by Prof. Li; (ii) the 4,883,250 Shares held by
Changsha Gangwan, which (1) is directly held as to 99% by Prof. Li as the limited partner, and (2) is held as to 1%
by Dongguan Intelligence as the general partner, which is controlled by Prof. Li; (iii) the 290,750 Shares held by
CWB Startup HK, which is wholly-owned by Clear Water Bay Startup Fund LP, the general partner of which is
Clear Water Bay Startup Fund GP, which in turn is held as to approximately 57% by Prof. Li; and (iv) the 132,979
Shares held by Changsha Shengyu, the majority of the partnership interest of which is held by Dongguan Yunhe,
which in turn is wholly-owned by CWB Startup HK.
(4) As of the Latest Practicable Date, Dr. Hu Albert Sibo was granted Options under the Share Incentive Scheme for up
to 138,270 H Shares, entitling him to receive dividends and other economic rights attributable to such Shares.
Save as disclosed above, none of the Directors or the chief executive officer of the Company
will, immediately following completion of the Global Offering, has any interests and/or short
positions in the Shares, underlying Shares and debentures of our Company’s associated
corporations (within the meaning of Part XV of the SFO), which will have to be notified to our
Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including
interests and short positions which he/she is 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 recorded in the register
referred to therein, or which will be required to be notified to our Company and the Stock
Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed
Companies contained in the Listing Rules.
2. Disclosure of Interests of Substantial Shareholders
(a) Interests in our Company
For information on the persons who will, immediately following the completion of the Global
Offering, having or be deemed or taken to have interests or short positions in our Shares or
underlying Shares which would be required to be disclosed to our Company and the Stock
Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or directly or
indirectly be interested in 10% or more of the nominal value of any class of share capital carrying
rights to vote in all circumstances at general meetings of our Company, see the section headed
“Substantial Shareholders”.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-26 –


--- page 793 ---
(b) Interests of the Substantial Shareholders of Other Members of Our Group
As of the Latest Practicable Date, so far as our Directors are aware, no other person (other
than our Directors or chief executive of our Company) will, immediately following the completion
of the Global offering, directly or indirectly, be interested in 10% or more of the nominal value of
any class of share capital carrying rights to vote in all circumstances at general meetings of any
other member of our Group.
3. Service Contracts
We have entered into a contract with each of our Directors in respect of, among other things,
compliance with the relevant laws and regulations, the Articles of Association and applicable
provisions on arbitration.
Save as disclosed above, we have not entered, and do not propose to enter, into any service
contracts with any of our Directors in their respective capacities as Directors (other than contracts
expiring or determinable by the employer within one year without any payment of compensation
(other than statutory compensation)).
4. Director’s Remuneration
Save as disclosed in the section headed “Directors and Senior Management” and Note 8 to
“Appendix I — Accountants’ Report” for the three years ended December 31, 2024 and the six
months ended June 30, 2025, none of our Directors received other remunerations of benefits in
kind from us.
5. Disclaimers
Saved as disclosed in this Prospectus:
(a) none of our Directors or any of the parties listed in “— E. Other Information — 4.
Qualifications of Experts” below is:
(i) interested in our promotion, or in any assets which, within the two years
immediately preceding the date of this document, have been acquired or disposed
of by or leased to us, or are proposed to be acquired or disposed of by or leased to
our Company;
(ii) materially interested in any contract or arrangement subsisting at the date of this
document which is significant in relation to our business;
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-27 –


--- page 794 ---
(b) save in connection with the Hong Kong Underwriting Agreement and the International
Underwriting Agreement, none of the parties listed in “— E. Other Information — 4.
Qualification of Experts” below:
(i) is interested legally or beneficially in any shares in any member of our Group; or
(ii) has any right (whether legally enforceable or not) to subscribe for or to nominate
persons to subscribe for any securities in any member of our Group;
(c) none of our Directors or their close associates or any shareholders of our Company who
to the knowledge of our Directors owns more than 5% of our issued share capital has
any interest in our top five customers or suppliers; and
(d) none of our Directors is a director or employee of a company that has an interest in the
share capital of our Company which, once the H Shares are listed on the Stock
Exchange, would have to be disclosed pursuant to Divisions 2 and 3 of Part XV of the
SFO.
D. SHARE INCENTIVE SCHEME
The following is a summary of the principal terms of the share incentive scheme (the “ Share
Incentive Scheme ”). The Share Incentive Scheme was adopted and approved on September 23,
2024.
Save for the disclosure requirements under Rule 17.12 of the Listing Rules, the Share
Incentive Scheme is not subject to the provisions under Chapter 17 of the Listing Rules and no
further options or awards may be granted under the Share Incentive Scheme after the Listing.
Under the Share Incentive Scheme, the Company will grant option(s) (“ Option(s) ”) to Scheme
Participants to acquire Unit(s) in the Shares held by Changsha Gangwan, pursuant to which the
Scheme Participants shall enjoy the dividends and other economic rights attributable to the Shares
held by Changsha Gangwan. As of the Latest Practicable Date, Changsha Gangwan held
93,410,000 Units, representing 4,305,280 Shares held in the Company (out of the 4,883,250 Shares
in total held by Changsha Gangwan), with all of the 93,410,000 Units having already been granted
to 368 Eligible Participants.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-28 –


--- page 795 ---
A summary of the key terms is set out as follows:
Summary of Key Terms
(a) Purpose. The purpose of the Share Incentive Scheme is to further bolster the corporate
governance structure, improve the incentive mechanism, encourage outstanding employees
and consultants to be more proactive, and foster the sense of responsibility among the
Scheme Participants to promote the stable, continuous and rapid growth of the Company.
(b) Administration. The Share Incentive Scheme is to be administered by an implementation
committee (the “ Implementation Committee ”), the members of which include Prof. Li, Dr.
Ma and Dr. Hu Albert Sibo. Any replacement of members of the Implementation Committee
shall be subject to the approval of the Board. Subject to the procedures stipulated in the
Articles of Association of the Company and Changsha Gangwan, the partnership agreement,
the shareholders’ agreement or other relevant documents (the “ Approval Procedures ”), the
Implementation Committee may (i) issue interpretations as to the terms, execution and
administration of the Share Incentive Scheme; (ii) choose and decide the Scheme
Participants; (iii) stipulate, amend, change or abolish the regulations of the Share Incentive
Scheme and make the appropriate decisions; (iv) amend and supplement the Share Incentive
Scheme, unless such actions would cause material adverse impact on the Options or Units
already obtained by the Scheme Participants, in which case the consent shall be obtained
from the Scheme Participants holding more than half of the issued Options at the time; (v)
decide on the distribution, grant, redemption, exercise or termination of the Options and the
terms and conditions thereof, and to make the relevant amendments, changes, cancellation or
waiver; and (vi) to decide on matters or exercise powers that the Company or the
Implementation Committee is responsible for under the Share Incentive Scheme. The
decisions of the Implementation Committee shall be final, definitive and binding on all
Scheme Participants. The Implementation Committee may authorize any of its members to
execute matters within the scope of its power. From the effective date of the Share Incentive
Scheme, the Implementation Committee may authorize any of its members to (i) verify and
confirm the exercise of the Options; and (ii) verify and confirm the exercise and conversion
of the Options into Units.
(c) Scheme Participants. The core employees of the Group (including ex-employees) and
consultants who work for, or have made significant contributions to the Group.
(d) Duration. The Share Incentive Scheme will be valid for 10 years commencing from the date
of approval by the Board of the Share Incentive Scheme, unless otherwise resolved by the
Board.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-29 –


--- page 796 ---
(e) Grant of Options. Option gives a Scheme Participant a conditional right to acquire Units
under the Share Incentive Scheme at a pre-determined price. Unless otherwise agreed by the
Implementation Committee, the purchase price (the “ Exercise Price ”) that a Scheme
Participant has to pay in order to exercise the Option and be assigned the Units shall be
decided by the Implementation Committee and shall be explicitly agreed in the relevant
option grant agreement (the “ Option Grant Agreement ”).
The grant of Options shall adhere to the principles of balancing responsibilities, rights and
benefits. Subject to the provisions of the prevailing Articles of Association, partnership
agreement, shareholders’ agreement or other constitutional documents of the Company and
Changsha Gangwan, Options may be allocated and granted based on the Scheme Participants’
positions and performance and their contribution to the Company’s results and in light of the
actual condition of the Company. Subject to the Approval Procedures, the Implementation
Committee shall have full and independent discretion to decide and adjust the ratio of
allocation, grant of Options and exercise price of the Options based on the development of
the Company. The Option Grant Agreement will take effect from the date on which the
Approval Procedures are satisfactorily completed. Unless otherwise agreed in writing by the
Implementation Committee, Options may be granted only if the Scheme Participant is still
employed by the Company (or a subsidiary or an affiliated company established by the
Company) or a labor or service relationship exists between the Scheme Participant and the
Company (or a subsidiary or an affiliated company established by the Company) on the date
of grant.
(f) Exercise of Options . Unless otherwise agreed in writing by the Implementation Committee,
upon the Scheme Participant exercising the Options under the Option Grant Agreement, the
Scheme Participant shall simultaneously receive the corresponding number of Units based on
the number of Options exercised. Subject to the provisions of the relevant laws and
regulations and the terms of the Share Incentive Scheme, the Company will, at its own
discretion from time to time after Listing, set up a window for a period of time (“ Exercise
Window ”) pursuant to which Scheme Participants have the right to exercise part of or all of
their Options and obtain Units in accordance with the terms of the Option Grant Agreement.
The Scheme Participant shall provide a written notice to the Implementation Committee in
respect of the exercise of such Options during the Exercise Window.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-30 –


--- page 797 ---
(g) Shares . All the 93,410,000 Units underlying the Options under the Share Incentive Scheme,
representing 4,305,280 Shares of the Company (accounting for approximately 9.83% of the
total issued share capital of our Company following completion of the Global Offering,
assuming the Over-allotment Option is not exercised) are currently held by Changsha
Gangwan for the purpose of holding Shares under the Share Incentive Scheme.
(h) Lapse of Options. Unless with the written consent of the Implementation Committee, an
Option shall lapse immediately on the occurrence of, among others, the following: (i) the
Scheme Participant’s employment with the Group is terminated as a result of serious
incompetence or a violation of the law, employment contract or regulations; (ii) the Scheme
Participant has materially neglected his/her duties or has committed malpractices for his/her
personal gains, or has seriously damaged the rights and interests of the Company (or any
subsidiary or affiliated company established by the Company); (iii) the Scheme Participant
has breached any employment contract, confidentiality agreement, work product attribution
agreement, non-compete agreement or any other agreements entered with the Company (or a
subsidiary or an affiliated company established by the Company); (iv) the Scheme Participant
has violated the rules and regulations of the Company (or a subsidiary or an affiliated
company established by the Company) during the course of employment; (v) the Scheme
Participant has materially breached the Option Grant Agreement, or has committed an
immaterial breach of the Option Grant Agreement but has failed to rectify the situation within
a reasonable period as required by Changsha Gangwan or the Company; (vi) the Scheme
Participant’s employment is terminated before the Listing of the Company; or (vii) the
Scheme Participant has violated the partnership agreement or other constitutional documents
of Changsha Gangwan. Upon the lapse of Options, unless the Implementation Committee
states otherwise in writing, the Company has the right to terminate the grant of Options to the
Scheme Participant and declare any or all Options that have been granted but not yet
exercised to be invalid. Should any Options be exercised already by the Scheme Participant,
the Company has the right to designate a third party to repurchase all Units purchased by the
Scheme Participant through the exercise of Options at a price determined by good faith by
the Implementation Committee (with such price being not lower than the Exercise Price), and
require the relevant Scheme Participant to withdraw from the Share Incentive Scheme.
(i) Transferability. Before the Listing of the Company, except with the written consent by the
Implementation Committee, any Options granted to the Scheme Participants pursuant to the
Share Incentive Scheme and the Option Grant Agreement shall not be capable of being sold,
transferred, given, pledged, mortgaged, gifted or otherwise disposed of by him/her, save that
in the event of his/her death, his/her personal representatives shall receive the benefit of
his/her Options, provided that the personal representatives shall be subject to the restrictions
and conditions that come with the Options as stipulated by the Option Grant Agreement, and
shall comply with the terms of the Share Incentive Scheme and the Option Grant Agreement.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-31 –


--- page 798 ---
(j) Lock-up Period. After the Listing, the Options will be subject to a lock-up period stipulated
by the Implementation Committee, in accordance with the requirements of the relevant
regulatory authorities and stock exchanges. The final day of such lock-up period shall not be
earlier than the end of the applicable lock-up period for the Shares held by Changsha
Gangwan upon Listing.
Issued shares underlying the Share Incentive Scheme
The following Directors, senior management, other management, employees and other
persons were granted Options under the Share Incentive Scheme prior to the Listing. The grant of
the Options under the Share Incentive Scheme to the grantees as set out below has been approved
by the Board.
Scheme Participant Position in the Group
Number of
Units
underlying
the Options
granted Date of Grant
Vesting
period (1)
Exercise
price per
Option (2)
Number of
Shares
underlying
the Options
granted
Approximate
percentage of the
issued Shares
immediately upon
completion of the
Global Offering (3)
(RMB)
Dr. Hu Albert Sibo .. Executive Director
and chief
executive officer
1,200,000
300,000
1,500,000
September 27,
2024
C
D
B
0.001
0.01
0.01
55,308
13,827
69,135
0.13%
0.03%
0.16%
Other Scheme
Participants
(4) ...
90,410,000 September 27,
2024 to
December 2,
2025
C 0.001 723,615 1.65%
C 0.01 149,793 0.34%
D 0.01 4,609 0.01%
C 0.05 399,141 0.91%
C 0.10 10,140 0.02%
C 0.20 78,353 0.18%
E 0.20 189,891 0.43%
E
(5) 0.20 18,436 0.04%
C 0.50 92,180 0.21%
A 1.00 1,904,445 4.35%
B 1.00 554,925 1.27%
D 1.00 41,481 0.09%
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-32 –


--- page 799 ---
Notes:
(1) Please refer to the different categories of vesting schedules below:
Category Vesting schedule
A 25% of the total granted Options shall vest one year from the date of grant, with the
remaining 75% to vest each year thereafter over the next three years in equal proportion
(i.e. 25% each year).
B 25% of the total granted Options shall vest at the end of the calendar year after the date
of grant, with the remaining 75% to vest at the end of each calendar year thereafter over
the next three years in equal proportion (i.e. 25% each calendar year).
C 100% of the total granted Options shall vest on the date of grant.
D 50% of the total granted Options shall vest on the date of grant, with the remaining 50%
shall vest each year thereafter over the next two years in equal proportion, beginning six
months from the date of grant.
E 60% of the total granted Options shall vest on the date of grant, with the remaining 40%
to vest at the end of the quarter of the date which falls 180 days after the date of grant.
(2) Subject to (i) the relevant vesting periods of the Options and (ii) the exercise of Options during the Exercise
Window described above, the exercise period for all of the Options is from the period which the Shares held by
Changsha Gangwan are not subject to any lock-up requirements under the relevant laws and regulations after
completion of the Listing, until September 7, 2034.
(3) These percentages are calculated on the basis of 43,789,310 Shares in issue immediately upon completion of the
Global Offering, assuming the Over-allotment Option is not exercised.
(4) Comprises of (a) other employee participants (including ex-employees) and (b) service providers with less than
0.1% of the Shares in issue (excluding treasury shares). No Options were granted to any participant in excess of the
1% individual limit or related entity participant (each as defined in the Listing Rules).
(5) For this particular batch of units granted, the remaining 40% shall vest at the beginning of the month of the date
which falls 180 days after the date of grant instead.
E. OTHER INFORMATION
1. Estate Duty
Our Directors have been advised that no material liability for estate duty is likely to impose
on our Company or our subsidiaries.
2. Litigation
To the knowledge of our Directors, no member of our Group has significant litigation or
claims pending or threatened against any member of our Group.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-33 –


--- page 800 ---
3. Joint Sponsors
The Joint Sponsors have made an application on our behalf to the Listing Committee for the
listing of, and permission to deal in, our H Shares in issue, our H Shares to be issued pursuant to
the Global Offering (including any H Shares which may fall to be issued pursuant to the exercise
of the Over-allotment Option). All necessary arrangements have been made to enable the securities
to be admitted into CCASS.
Pursuant to the engagement letter entered into between the Company and the Joint Sponsors,
we have agreed to pay each of the Joint Sponsors a fee of US$300,000 to act as the sponsors of
our Company in connection with the proposed listing on the Hong Kong Stock Exchange, which
has yet to be paid in full to the Joint Sponsors as of the Latest Practicable Date.
China International Capital Corporation Hong Kong Securities Limited and China Securities
(International) Corporate Finance Company Limited satisfy the independence criteria applicable to
sponsors set out in Rule 3A.07 of the Listing Rules.
Ping An of China Capital (Hong Kong) Company Limited is a subsidiary of Ping An
Insurance (Group) Company of China, Ltd. (2318.HK), which has business relationships with the
Company and/or its subsidiaries and also holds Founder Securities, a beneficial holder of
Changsha Hesheng, Tibet Fangchuang and Ningbo Jiusheng, pre-IPO investors of the Company,
may not be able to perform its duties as an independent sponsor as set out in Chapter 3A of the
Listing Rules.
4. Qualifications of Experts
The qualifications of the experts who have given opinions or advice in this Prospectus are as
follows:
Name Qualification
China International Capital
Corporation Hong Kong
Securities Limited
Licensed 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) regulated activities as
defined under the SFO
China Securities (International)
Corporate Finance Company
Limited
A licensed corporation to conduct Type 1 (dealing in
securities) and Type 6 (advising on corporate finance)
regulated activities (as defined under the SFO)
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-34 –


--- page 801 ---
Name Qualification
Ping An of China Capital (Hong
Kong) Company Limited
Licensed corporation under the SFO to engage in type 6
(advising on corporate finance) regulated activity
BDO Limited Certified Public Accountants and Registered Public Interest
Entity Auditor
Zhong Lun Law Firm Legal advisors as to PRC laws to our Company
China Insights Industry Consultancy
Limited
Independent industry consultant
A VISTA Valuation Advisory
Limited
Independent property valuer
Pillsbury Winthrop Shaw Pittman
LLP
U.S. export control and sanctions counsel
Each of the experts named above has given and has not withdrawn its consent to the issue of
this Document with the inclusion of its report, letter, and/or legal opinion (as the case may be) and
references to its name included in the form and context in which it respectively appears.
As of the Latest Practicable Date, none of the experts named above has any shareholding
interest in our Company or any of our subsidiaries or the right (whether legally enforceable or not)
to subscribe for or to nominate persons to subscribe for securities in any member of our Group.
5. Binding Effect
This Prospectus shall have the effect, if an application is made pursuant to this Document, of
rendering all persons concerned bound by all of the provisions (other than the penal provisions) of
sections 44A and 44B of the Companies (Winding Up and Miscellaneous Provisions) Ordinance
insofar as applicable.
6. Bilingual Document
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 Ordinance
(Exemption of Companies and Prospectuses from Compliance with Provisions) Notice (Chapter
32L of the Laws of Hong Kong). In case of any discrepancies between the English language
version and Chinese language version of this Prospectus, the English language version shall
prevail.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-35 –


--- page 802 ---
7. Compliance Adviser
Our Company has appointed Gram Capital Limited as its compliance adviser in compliance
with Rule 3A.19 of the Listing Rules.
8. Preliminary Expenses
The Company did not incur material preliminary expenses for the purpose of the Listing
Rules.
9. No Material Adverse Change
Our Directors confirm that, as of the date of this prospectus, there has been no material
change in our financial or financial position since June 30, 2025.
10. Promoters
The promoters of our Company comprised all of the 50 then shareholders of our Company, as
of July 2, 2024 before our conversion into a joint stock limited liability company. Save as
disclosed in this Prospectus, within the two years immediately preceding the date of this
prospectus, no cash, securities or benefit has been paid, allotted or given, or is proposed to be
paid, allotted or given to the promoters named above in connection with the Global Offering or the
related transactions described in this prospectus.
11. Taxation of Holders of H Shares
Hong Kong stamp duty, currently charged at the ad valorem rate of 0.10% on the higher of
the consideration for or the market value of the H Shares, will be payable by the purchaser on
every purchase and by the seller on every sale of any Hong Kong securities, including H Shares
(in other words, a total of 0.20% is currently payable on a typical sale and purchase transaction
involving H Shares). In addition, a fixed stamp duty of HK$5.00 is currently payable on any
instrument of transfer of H Shares. Where one of the parties is a resident outside Hong Kong and
does not pay the ad valorem duty due by it, the duty not paid will be assessed on the instrument of
transfer (if any) and will be payable by the transferee. If no stamp duty is paid on or before the
due date, a penalty of up to 10 times the duty payable may be imposed.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-36 –


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12. Miscellaneous
Save as disclosed in this Prospectus:
(a) within the two years preceding the date of this prospectus: (i) we have not issued nor
agreed to issue any share or loan capital fully or partly paid either for cash or for a
consideration other than cash; and (ii) no commissions, discounts, brokerage fee or other
special terms have been granted in connection with the issue or sale of any shares of our
Company;
(b) no share or loan capital of our Company is under option or is agreed conditionally or
unconditionally to be put under option;
(c) we have not issued nor agreed to issue any founder shares, management shares or
deferred shares;
(d) there are no arrangements under which future dividends are waived or agreed to be
waived;
(e) there are no procedures for the exercise of any right of pre-emption or transferability of
subscription rights;
(f) there have been no interruptions in our business which may have or have had a
significant effect on our financial position in the last 12 months;
(g) there are no restrictions affecting the remittance of profits or repatriation of capital by
us into Hong Kong from outside Hong Kong;
(h) no part of the equity or debt securities of our Company, if any, is currently listed on or
dealt in on any stock exchange or trading system, and no such listing or permission to
list on any stock exchange other than the Stock Exchange is currently being or agreed to
be sought; and
(i) our Company has no outstanding convertible debt securities or debentures.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-37 –


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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) the written consents referred to in “Appendix VII — Statutory and General Information
— E. Other Information — 4. Qualifications of Experts”; and
(b) a copy of each of the material contracts referred to in “Appendix VII — Statutory and
General Information — B. Further Information about our Business — 1. Summary of
Material Contracts”.
DOCUMENTS A V AILABLE ON DISPLAY
Copies of the following documents will be available on display on the website of the Stock
Exchange at www.hkexnews.hk
and our website at www.cidi.ai during a period of 14 days from
the date of this prospectus:
1. the Articles of Association;
2. the Accountant’s Report prepared by BDO Limited, the text of which is set forth in
Appendix I to this prospectus;
3. the audited consolidated financial statements of our Company for the three financial
years ended December 31, 2024 and the six months ended June 30, 2025;
4. the report from BDO Limited on the unaudited pro forma financial information of our
Group, the text of which is set forth in Appendix II to this Prospectus;
5. the letter, summary of values and valuation certificates relating to our property interests
prepared by A VISTA Valuation Advisory Limited, the text of which is set out in
Appendix III to this prospectus;
6. the material contracts in “Appendix VII — Statutory and General Information — B.
Further Information about our Business — 1. Summary of Material Contracts”;
7. the written consents referred to in “Appendix VII — Statutory and General Information
— E. Other Information — 4. Qualifications of Experts”;
APPENDIX VIII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VIII-1 –


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8. the service contracts referred to in “Appendix VII — Statutory and General Information
— C. Further Information about our Directors and Senior Management — 3. Service
Contracts”;
9. the legal opinions issued by Zhong Lun Law Firm, our PRC Legal Advisor, in respect
of, among other things, the general corporate matters and the property interests of our
Group under PRC law;
10. the legal opinion on U.S. export control and sanctions matters issued by Pillsbury
Winthrop Shaw Pittman LLP;
11. the industry report issued by China Insights Industry Consultancy Limited, the summary
of which is set forth in the section headed “Industry Overview” in this prospectus;
12. the terms of the Share Incentive Scheme; and
13. a copy of the following PRC laws, together with their unofficial English translations:
 the PRC Company Law;
 the PRC Securities Law; and
 the Overseas Listing Trial Measures.
APPENDIX VIII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VIII-2 –


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CiDi Inc.
希迪智駕科技股份有限公司
CiDi Inc.
希迪智駕科技股份有限公司
希迪智駕科技股份有限公司
(A joint stock company incorporated in the People's Republic of China with limited liability)
Stock Code: 3881
Joint Sponsors, Overall Coordinators,
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
GLOBAL
OFFERING
GLOBAL
OFFERING
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Project Nova Cover V14D_ENG_38mm_OP.pdf   1   9/12/2025   下午8:54
