--- page 1 ---
GLOBAL OFFERING
(A joint stock company incorporated in the People’s Republic of China with limited liability)
Stock Code: 9678
Joint Sponsors, Sponsor-Overall Coordinators, Overall Coordinators, Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Bookrunners and Joint Lead Managers
Unisound AI Technology Co., Ltd.
雲知聲智能科技股份有限公司
Unisound AI Technology Co., Ltd.
雲知聲智能科技股份有限公司


--- page 2 ---
IMPORTANT
If you are in any doubt about any of the contents of this prospectus, you should obtain independent professional advice.
UNISOUND AI TECHNOLOGY CO., LTD.
ʮ̡
(A joint stock company incorporated in the People’s Republic of China with limited liability)
GLOBAL OFFERING
Number of Offer Shares under
the Global Offering
: 1,560,980 H Shares (subject to
the Over-allotment Option)
Number of Hong Kong Offer
Shares
: 156,100 H Shares (subject to
reallocation)
Number of International Offer
Shares
: 1,404,880 H Shares (subject to
reallocation and the
Over-allotment Option)
Maximum Offer Price : HK$205.00 per H Share plus
brokerage of 1.0%, SFC
transaction levy of 0.0027%,
AFRC transaction levy of
0.00015% and the Stock
Exchange trading fee of
0.00565% (payable in full on
application, subject to
refund)
Nominal value : RMB1.0 per H Share
Stock code : 9678
Joint Sponsors, Sponsor-Overall Coordinators, Overall Coordinators,
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Bookrunners and Joint Lead Managers
Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsib ility for the contents of this prospectus, make no
representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss 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 the paragraph headed “Documents Delivered to the Registrar of Companie s in Hong Kong and Available on Display” in Appendix VII 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 P rovisions) Ordinance (Chapter 32 of the Laws of Hong Kong). The
Securities and Futures Commission and the Registrar of Companies in Hong Kong take no responsibility as to the contents of this prospectus or any other document referred to above.
The Offer Price is expected to be fixed by agreement between the Overall Coordinators (on behalf of the Hong Kong Underwriters) and us on the Price Deter mination Date. The Price Determination Date is expected to be
on or around Thursday, June 26, 2025 (Hong Kong time) and, in any event, not later than 12:00 noon on Thursday, June 26, 2025 (Hong Kong time). The Offer Pr ice will be not more than HK$205.00 and is currently expected to
be not less than HK$165.00 per Offer Share. If, for any reason, the Offer Price is not agreed by 12:00 noon on Thursday, June 26, 2025 (Hong Kong time) betw een the Overall Coordinators (on behalf of the Hong Kong
Underwriters) and us, the Global Offering will not proceed and will lapse.
Applicants for Hong Kong Offer Share may be required to pay, on application (subject to the application channels), the maximum Offer Price of HK$205.0 0 for each Hong Kong Offer Share together with a brokerage of
1.0%, a SFC transaction levy of 0.0027%, AFRC transaction levy of 0.00015% and a Hong Kong Stock Exchange trading fee of 0.00565%, subject to refund if t he Offer Price as finally determined is less than HK$205.00.
The Company is incorporated, and its businesses are located, in the PRC. Potential investors in the Company should be aware of the differences in the le gal, economic and financial systems between the mainland of the
PRC and Hong Kong and that there are different risk factors relating to investment in PRC incorporated businesses. Potential investors should also be aware that the regulatory framework in the PRC is different from the
regulatory framework in Hong Kong and should take into consideration the different market nature of the shares of the Company. Such differences and ri sk factors are set out in the sections headed “Risk Factors”, “Appendix IV
— Summary of Principal Legal and Regulatory Provisions” and “Appendix V — Summary of the Articles of Association” to this prospectus.
Prior to making an investment decision, prospective investors should consider carefully all of the information set out in this prospectus, includin g but not limited to the risk factors set out in the section headed “Risk
Factors” in this prospectus. The obligations of the Hong Kong Underwriters under the Hong Kong Underwriting Agreement are subject to termination by t he 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 – Underwriting Arrangements and Expense – Hong Kong Public Offering – G rounds for termination” of this prospectus.
The Offer Shares have not been and will not be registered under the U.S. Securities Act or any state securities law in the United States and may be offered , sold, pledged or transferred within the United States, except
pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and applicable U.S. state s ecurities laws. The Offer Shares are being offered and sold outside of the United
States in offshore transactions in reliance on Regulation S under the U.S. Securities Act.
June 20, 2025


--- page 3 ---
IMPORTANT
IMPORTANT NOTICE TO INVESTORS:
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong Public Offering. We will
not provide printed copies of this prospectus to the public in relation to the Hong Kong Public
Offering.
This prospectus is available at the website of the Hong Kong Stock Exchange at www.hkexnews.hk
under the “HKEXnews > New Listings > New Listing Information” section, and our website at
www.unisound.com. 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 via the HK eIPO White Form service at www.hkeipo.hk;o r
(2) apply electronically through the HKSCC EIPO channel and cause HKSCC Nominees to
apply on your behalf by instructing your broker or custodian who is a HKSCC Participant
to give electronic application instructions via HKSCC’s FINI system to apply for the Hong
Kong Offer Shares on your behalf.
We will not provide any physical channels to accept any application for the Hong Kong Offer Shares
by the public. The contents of the electronic version of this prospectus are identical to the printed
prospectus as registered with the Registrar of Companies in Hong Kong pursuant to Section 342C of
the Companies (Winding Up and Miscellaneous Provisions) Ordinance.
If you are an intermediary, broker or agent, please remind your customers, clients or principals, as
applicable, that this prospectus is available online at the website addresses above.


--- page 4 ---
IMPORTANT
Your application through the HK eIPO White Form service or the HKSCC EIPO channel must be for
a minimum of 20 Hong Kong Offer Shares and in one of the numbers set out in the table below. If you
are applying through the HK eIPO White Form service, you may refer to the table below for the
amount payable for the number of H Shares you have selected. You must pay the respective maximum
amount payable on application in full upon application for Hong Kong Offer Shares. If you are
applying through the HKSCC EIPO channel, you are required to prefund your application based on the
amount specified by your broker or custodian, as determined based on the applicable laws and
regulations in Hong Kong.
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable(2) on
application/
successful
allotment
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable(2) on
application/
successful
allotment
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable(2) on
application/
successful
allotment
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount payable(2)
on application/
successful
allotment
HK$ HK$ HK$ HK$
20 4,141.35 400 82,826.96 6,000 1,242,404.56 40,000 8,282,697.00
40 8,282.69 500 103,533.71 7,000 1,449,471.98 50,000 10,353,371.26
60 12,424.04 600 124,240.45 8,000 1,656,539.40 60,000 12,424,045.50
80 16,565.39 700 144,947.20 9,000 1,863,606.83 78,040
(1) 16,159,541.85
100 20,706.74 800 165,653.95 10,000 2,070,674.26
120 24,848.09 900 186,360.68 12,000 2,484,809.10
140 28,989.43 1,000 207,067.43 14,000 2,898,943.96
160 33,130.79 2,000 414,134.86 16,000 3,313,078.80
180 37,272.14 3,000 621,202.28 18,000 3,727,213.66
200 41,413.49 4,000 828,269.70 20,000 4,141,348.50
300 62,120.22 5,000 1,035,337.13 30,000 6,212,022.76
(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 Hong Kong Offer Shares will be considered and any such
application is liable to be rejected.


--- page 5 ---
EXPECTED TIMETABLE(1)
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 Company’s website at
www.unisound.com and the website of the Stock Exchange at www.hkexnews.hk.
Hong Kong Public Offering commences ....................... 9:00 a.m. on
Friday, June 20, 2025
Latest time to complete electronic applications under the HK eIPO
White Form service through the designated website at
www.hkeipo.hk(2)
11:30 a.m. on
Wednesday, June 25, 2025
Application lists of the Hong Kong Public Offering open (3) ........ 11:45 a.m. on
Wednesday, June 25, 2025
Latest time to (a) lodge completing payment of HK eIPO White
Form applications by effecting internet banking transfers(s) or PPS
payment transfer(s) and (b) giving electronic application
instructions to HKSCC(4) ..................................
12:00 noon on
Wednesday, June 25, 2025
If you are instructing your broker or custodian who is a HKSCC Clearing Participant to give
electronic application instructions via HKSCC FINI system to apply for the Hong Kong Offer Shares
on your behalf, you are advised to contact your broker or custodian for on a 24-hour basis the latest
time for giving such instructions which may be different from the latest time as stated above.
Application lists close (3) ....................................
12:00 noon on
Wednesday, June 25, 2025
Expected Price Determination Date (5) ......................... Thursday, June 26, 2025
Announcement of the final Offer Price, the level of indications of
interest in the International Offering, the level of applications in the
Hong Kong Public Offering and the basis of allocation of the Hong
Kong Offer Shares under the Hong Kong Public Offering to be
published and on the website of the Stock Exchange at
www.hkexnews.hk and the Company’s website at
www.unisound.com on or before ............................
11:00 p.m. on
Friday, June 27, 2025
The results of allocations in the Hong Kong Public Offering (with successful applicants’ identification
document numbers, where appropriate) to be available through a variety of channels, including:
 in the announcement to be posted on our website and the
website of the Stock Exchange at www.unisound.com and
www.hkexnews.hk respectively ......................... Friday, June 27, 2025
 from “Allotment Results” page at the designated results of
allocations website at www.tricor.com.hk/ipo/result or
www.hkeipo.hk/IPOResult with a “search by ID” function
from ...............................................
11:00 p.m. on
Friday, June 27, 2025
to 12:00 midnight on
Thursday, July 3, 2025
i


--- page 6 ---
EXPECTED TIMETABLE(1)
 from the allocation results telephone enquiry by calling +852
3691 8488 between 9:00 a.m. and 6:00 p.m. from ............
Monday, June 30, 2025 to
Friday, July 4, 2025 on a
business day
Dispatch of H Share certificates or deposit of H Share certificates
into CCASS in respect of wholly or partially successful application
under the Hong Kong Public Offering on or before
(7)(9) ........... Friday, June 27, 2025
HK eIPO White Form e-Auto Refund payment instructions/refund
checks in respect of wholly or partially successful applications if the
final Offer Price is less than the maximum Offer Price per Offer
Share initially paid on application (if applicable) or wholly or
partially unsuccessful applications to be dispatched on or
before
(8)(9) ............................................... Monday, June 30, 2025
Dealings in H Shares on the Stock Exchange expected to
commenced at ............................................
9:00 a.m. on
Monday, June 30, 2025
Notes:
(1) All times and dates refer to Hong Kong local times and dates.
(2) You will not be permitted to submit your application under the HK eIPO White Form service through the designated website at
www.hkeipo.hk after 11:30 a.m. on the last day for submitting applications. If you have already submitted your application and obtained
an application reference number from the designated website prior to 11:30 a.m., you will be permitted to continue the application
process (by completing payment of application monies) until 12:00 noon on the last day for submitting applications, when the application
lists close.
(3) If there is/are “black” rainstorm warning signal or a tropical cyclone warning signal number 8 or above and/or Extreme Conditions at any
time between 9:00 a.m. and 12:00 noon on Wednesday, June 25, 2025, the application lists will not open or close on that day. For further
details, please see “How to Apply for Hong Kong Offer Shares — E. Severe Weather Arrangements”.
(4) Applicants who apply for Kong Offer Shares by giving electronic application instructions to HKSCC via CCASS should refer to “How
to Apply for Hong Kong Offer Shares — A. Application for Hong Kong Offer Shares — 2. Application Channels”.
(5) The Price Determination Date is expected to be on or about Thursday, June 26, 2025 and in any event, not later than 12:00 noon on
Thursday, June 26, 2025. If, for any reason, the Offer Price is not agreed between the Overall Coordinators (on behalf of the
Underwriter) and us on or before 12:00 noon on Thursday, June 26, 2025, the Global offering will not proceed and will lapse.
(6) None of the website or any of the information contained on the websites forms part of this prospectus.
(7) The H Share certificates are expected to be issued on Friday, June 2 7, 2025 but will only become valid provided that the Global Offering
has become unconditional in all respects and neither of the Underwri ting Agreements has been terminated in accordance with its terms,
which is scheduled to be at around 8:00 a.m. on Monday, June 30, 2025. Investors who trade H Shares on the basis of publicly available
allocation details before the receipt of the H Share certificates and before they become valid do so entirely of their own risk.
(8) e-Auto Refund payment instructions/refund checks will be issued in respect of wholly or partially unsuccessful applications pursuant to
the Hong Kong Public Offering and in respect of wholly or partially successful applicants in the event that the final Offer Price is less
than the price payable per Offer Share on application. Part of the applicant’s identification document number, or, if the application is
made by joint applicants, part of the identification document number of the first-named applicant, provided by the applicant(s) may be
printed on the refund check, if any. Such data would also be transferred to a third party for refund purposes. Banks may require
verification of an applicant’s identification document number before encashment of the refund check. Inaccurate completion of an
applicant’s identification document number may invalidate or delay encashment of the refund check.
(9) Applicants who have applied through the HK eIPO White Form service for 50,000 or more Hong Kong Offer Shares may collect
H Share certificates in person from our H Share Registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre,
16 Harcourt Road, Hong Kong from 9:00 a.m. to 1:00 p.m. on Monday, June 30, 2025 or any other places or date as notified by us as the
date of dispatch/collection of H Share certificates/e-Auto Refund payment instructions/refund checks. Applicants being individuals who
are eligible for personal collection may not authorize any other person to collect on their behalf. If you are a corporate applicant which is
eligible for personal collection, your authorized representative must bear a letter of authorization from your corporation stamped with
your corporation’s chop. Both individuals and authorized representative must produce evidence of identity acceptable to our H Share
Registrar at the time of collection.
Applicants who have applied for Hong Kong Offer Shares through the HKSCC EIPO channel should refer to “How to Apply for Hong
Kong Offer Shares — D. Despatch/Collection of H Share Certificates and Refund of Application Monies” for details.
Applicants who have applied through the HK eIPO White Form service and paid their applications monies through single bank
accounts may have refund monies (if any) dispatched to the bank account in the form of e-Auto Refund payment instructions. Applicants
who have applied through the HK eIPO White Form service and paid their application monies through multiple bank accounts may
have refund monies (if any) dispatched to the address as specified in their application instructions in the form of refund checks in favor
of the applicant (or, in the case of joint applicants, the first-named applicant) by ordinary post at their own risk.
ii


--- page 7 ---
EXPECTED TIMETABLE(1)
H Share certificates for applicants who have applied for less than 50,000 Hong Kong Offer Shares and any uncollected H Share
certificates will be dispatched by ordinary post, at the applicants’ risk, to the addresses specified in the relevant applications.
Further information is set out in “How to Apply for Hong Kong Offer Shares — D. Despatch/Collection of H Share Certificates and
Refund of Application Monies”.
The above expected timetable is a summary only. You should read carefully the sections headed
“Underwriting”, “Structure of the Global Offering” and “How to Apply for Hong Kong Offer Shares”
of this prospectus for details relating to the structure of the Global Offering, procedures on the
applications for Hong Kong Offer Shares and the expected timetable, including conditions, effect of
bad weather and the dispatch of refund monies and H Share certificates.
If the Global Offering does not become unconditional or is terminated in accordance with its terms, the
Global Offering will not proceed. In such case, the Company will make an announcement as soon as
practicable thereafter.
iii


--- page 8 ---
CONTENTS
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 Sponsor-Overall Coordinators, the Overall Coordinators, the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market
Intermediaries, the Underwriters, any of our or their respective directors, officers, employees,
agents or representatives of any of them, or any other person or party involved in the Global
Offering. Information contained on our website, located at www.unisound.com, does not form
part of this prospectus.
Page
Expected Timetable .................................................................... i
Contents .............................................................................. iv
Summary ............................................................................. 1
Definitions ............................................................................ 17
Glossary of Technical Terms ............................................................. 28
Forward-Looking Statements ............................................................ 33
Risk Factors ........................................................................... 34
Waivers from Strict Compliance with the Listing Rules ...................................... 61
Information about this Prospectus and the Global Offering ................................... 64
Directors, Supervisors and Parties Involved in the Global Offering ............................. 69
Corporate Information .................................................................. 75
Industry Overview ..................................................................... 77
Regulatory Overview ................................................................... 93
History, Development and Corporate Structure ............................................. 117
Business .............................................................................. 149
Directors, Supervisors and Senior Management ............................................. 262
Relationship with Our Controlling Shareholders ............................................ 278
Substantial Shareholders ................................................................ 282
Share Capital .......................................................................... 285
Cornerstone Investors .................................................................. 288
iv


--- page 9 ---
CONTENTS
Page
Financial Information ................................................................. 293
Future Plans and Use of Proceeds ....................................................... 334
Underwriting ........................................................................ 339
Structure of the Global Offering ........................................................ 350
How to Apply for Hong Kong Offer Shares ............................................... 360
Appendix I—Accountant’s Report ....................................................... I-1
Appendix II—Unaudited Pro Forma Financial Information ................................. II-1
Appendix III—Taxation and Foreign Exchange ........................................... III-1
Appendix IV—Summary of Principal Legal and Regulatory Provisions ........................ IV-1
Appendix V—Summary of the Articles of Association ...................................... V-1
Appendix VI—Statutory and General Information ......................................... VI-1
Appendix VII—Documents Delivered to the Registrar of Companies in Hong Kong and Available
on Display ......................................................................... VII-1
v


--- page 10 ---
SUMMARY
This summary aims to give you an overview of the information contained in this prospectus. As it is
a summary, it does not contain all the information that may be important to you and is qualified in its
entirety by, and should be in conjunction with, the full text of this prospectus. You should read the entire
prospectus before you decide to invest in the Offer Shares.
There are risks associated with any investment. Some of the risks in investing in the Offer Shares
are set out in “Risk Factors” of this prospectus. You should read that section carefully before you decide
to invest in the Offer Shares.
OVERVIEW
Who We Are
We are an AI solution provider focusing on the sales of conversational AI products and solutions for daily
life and healthcare related application scenarios in China. Our business centers on empowering customers across
various industries with user-centric AI solutions that improve operational efficiency, enhance decision-making
and deliver better outcomes. These solutions are built on our proprietary central technology platform, UniBrain,
which serves as the foundation of a wide range of applications, from intelligent customer service and healthcare
diagnostics to multilingual conversational assistants. Our technology leverages continuous human interaction to
refine its capabilities. In 2023, we introduced UniGPT, a 60 billion-parameter large language model with
generative multilingual and multimodal capabilities, which enables human-machine interaction through dynamic
reasoning and cross-modal data processing. Supported by our Atlas AI infrastructure, we ensure efficient model
training and deployment, driving iteration and industry-specific adaptation.
We have offered products and solutions for a broad range of application scenarios in AI in Daily Life and
AI in healthcare. China’s AI solution market is highly fragmented. According to Frost & Sullivan, we remained
the fourth largest AI solution provider by revenue with a market share of 0.6% in China in each year of the Track
Record Period. While the market size of AI solution in China increased by 33.1% from RMB135.5 billion in
2023 to RMB180.4 billion in 2024, our revenue increased by 29.1% from RMB727.3 million in 2023 to
RMB939.0 million in 2024. In 2024, we ranked third by revenue in AI Solution in Daily Life and fourth in AI
Solution in Healthcare in China. Extensive commercial application of these products and solutions has provided
us with high-quality user feedback, which, in turn, has been prompting incessant iterations of UniGPT as the core
of UniBrain.
The diagram below illustrates the Atlas AI infrastructure, UniBrain and the AI application solutions,
which are respectively the foundational layer, the central technology platform layer and the application layer that,
together, form the technology stack of our AI solutions.
1


--- page 11 ---
SUMMARY
Atlas
AI Infrastructure
Intelligent
Computing Cluster
Machine Learning
Algorithms
Data-centric
Training
UniBrain
AI
Application
Solutions
Daily Life Healthcare …
UniGPT
AI
Components
Plug-in
Extension
Unsupervised
Pre-training
Feedback
Reinforcement
Instruction
Fine-Tuning
Multimodal
Language
Knowledge
Reasoning
… …
AI Application Solutions
Sitting at the top of our technology stack, our AI application solutions layer is what users interact with.
Based on UniBrain, we offer easy-to-deploy AI products and solutions with optimal performance that can be
efficiently fine-tuned for a broad range of customers, helping them improve operational efficiency and
productivity, as well as bring value to end users across industries. Specifically, the AI application solutions can
be divided into Daily Life and Healthcare scenarios:
Š Daily Life: We provide diverse AI products and solutions that can be applied in application scenarios,
including transportation, commercial space, hospitality and residential scenarios, among others, to
improve the convenience and quality of people’s everyday life. Enterprises can provide immersive
intelligent products and services empowered by our AI solutions to their customers, thereby improving
their operational efficiency and service quality and reducing their management costs. For example, we
developed the voice ticketing system applied in the auto ticketing machine of the Shenzhen Metro Line
20. Such system enables passengers to select their destinations through speech, shortening the average
time spent on selecting a station on a ticketing machine from approximately 15 seconds in the
traditional manual way to about 1.5 seconds. Such function enhances the efficiency of ticket purchasing
and addresses the issue of congestion caused by queues at ticketing machines, thereby improving the
overall passenger experience and optimizing the flow of traffic within the metro station. In 2022, 2023
and 2024, our Daily Life solutions empowered 299, 294 and 313 enterprise customers and 86, 112 and
121 system integrators/agents, which include a top three insurance group in China, Shenzhen Metro
Line 20 and Xiamen Software Park. In addition, we provide AI large language model capabilities
through MaaS to developers and enterprises on-demand. Key products include public cloud-based AI
capability application programming interfaces (“APIs”) that enable different applications to
communicate with each other, customized proprietary AI technology service platforms and AI model-
embedded chips and Internet of things (IoT) hardware modules. In 2022, 2023 and 2024, we sold 12.8
million, 24.5 million and 36.0 million AI chips to developers and customers, respectively. We typically
determine the final price of our offerings based on the total unit price of the products selected by the
customer and the level of customization performed.
Š Healthcare: We offer AI-empowered healthcare solutions such as medical record voice entry,
medical record quality control, single-disease quality control and medical insurance payment
management. These AI solutions are typically delivered as customized AI-empowered business
systems, which can regulate medical service processes and decisions, thus reducing medical errors,
improving medical service quality and safeguarding the rights of the patients. For instance, in the
2


--- page 12 ---
SUMMARY
context of medical record quality control, traditional information technology solutions, prior to the
application of AI, could only perform basic quality control in terms of timeliness and completeness.
However, with the application of natural language understanding and clinical knowledge mapping, it
can now conduct quality control in terms of standardization and rationality, greatly enhancing the
scope and depth of quality control and reaching a degree of completion close to that of manual
expert quality control. Specifically, natural language understanding technology is used to identify
entities and extract relationships from medical record texts. Through understanding these documents,
it can model and recreate the changes in a hospitalized patient’s condition and the process of
diagnosis and treatment. Then, the knowledge stored in clinical knowledge graph is applied for
reasoning to determine whether the diagnosis and treatment actions reflected in the medical record
documents are reasonable, thereby conducting in-depth quality control.
These AI solutions can also help medical staff increase efficiency. For example, our medical record
voice entry system accelerates medical record entries by four to six times, compared to typing input;
our medical record quality control system reduces the time required for quality review by 80%,
compared to manual review, and thus is capable of a full inspection of all the medical records,
compared to a sampling inspection of medical records if reviewed manually. They also help prevent
unreasonable medical expenses, supporting medical reform and improving the utilization and
efficiency of medical insurances. See “— Our Offerings — Healthcare.” In 2024, we provided AI
solutions to 166 customers in Healthcare. We typically determine the final price based on the
functionalities of the solutions provided and the level of customization performed.
The following table sets out a breakdown of our revenue by streams and the offering types thereunder for
the years indicated:
For the year
ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Daily Life ..................................... 486,682 81.0 578,729 79.6 739,830 78.8
Solutions ...................................... 393,197 65.5 475,230 65.3 622,534 66.3
Products ....................................... 93,485 15.5 103,499 14.3 117,296 12.5
Healthcare .................................... 113,452 18.9 148,245 20.4 199,180 21.2
Others(1) ....................................... 4 8 5 0 . 1 3 4 2 0 . 0 7 0 . 0
Total ......................................... 600,619 100.0 727,316 100.0 939,017 100.0
Note:
(1) Others primarily consist of revenue from leasing office premises and sales of certain electronic devices.
The following table sets out a breakdown of our revenue by customer type in absolute amounts
and as a percentage of revenue for the years indicated:
Year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Enterprise customers ............................. 316,684 52.7 389,849 53.6 422,064 44.9
System integrators / Agents ....................... 283,935 47.3 337,467 46.4 516,953 55.1
Total ......................................... 600,619 100.0 727,316 100.0 939,017 100.0
3


--- page 13 ---
SUMMARY
Pricing
We have developed different pricing policies for our products and solutions. Specifically:
Š Daily Life: We generally provide customers with a menu-style quotation of our Daily Life solutions
and products. The quotation of each solution typically depends on, among others, cost of sales,
supply and demand, the marketing positioning, and the price of competitive solutions and products.
We combine the selected solutions and products and make appropriate customized modification for
our customers.
O Daily Life solutions, AI Chips and AI Modules : We typically determine the final price based on
the total unit price of the products selected by the customer and the level of customization
performed.
O AI Capability APIs : We charge subscription fees for such services on a pay-per-use basis.
During the Track Record Period, such subscription fees were insignificant to our total revenue.
Š Healthcare: Our Healthcare solutions are typically delivered as customized one-stop AI-empowered
business systems, where a selection of our AI soft-and hardware are integrated according to specific
customer demands. We also provide standardized efficiency tools, such as voice interaction solutions
and service solutions, based on conversational AI capabilities. We generally determine the price of
our Healthcare solutions considering various factors, including market positioning, market
conditions, policy requirements, type of customers, pricing of competitors, functionalities of the
solutions and level of customization.
Atlas AI Infrastructure
Our Atlas AI Infrastructure consists of the hardware and software resources which enable computing,
storage, connectivity, scheduling and management. It supports the development, optimization and operation of
our central technology platform, UniBrain, as well as UniBrain’s core algorithm model, UniGPT. We
strategically started building the Atlas AI infrastructure in 2016, which centers on our intelligent computing
cluster, dynamically scheduling strong computing power for efficient machine learning tasks. Atlas’s intelligent
computing cluster currently harbors a computing power of over 184 PFLOPS and a storage capacity of over
10PB, both of which can be expanded without interrupting training tasks. Our intelligent computing cluster can
efficiently and dynamically dispatch thousands of GPUs for parallel computing and seamlessly perform dynamic
scale-up to address shifting business demand. It also optimizes the utilization of resources such as storage,
bandwidth and computing power for large-scale machine learning tasks, addressing their significant demands for
parallel computing. The strong computing power, efficient and dynamic dispatch and scalability of the intelligent
computing cluster form our core competitive strengths in advancing AI solutions.
UniBrain
Featuring high universality, adaptability and efficiency, UniBrain is the central technology platform
which can be delivered through chips, edge-side SDKs and public and private cloud deployment. This central
technology platform powers our AI application solutions, and is where our developers build, test and manage the
AI application solutions. UniBrain comprises a core algorithm model and a wide array of AI components. The
core algorithm model had been UniCore since 2019 until it was replaced by UniGPT in May 2023. UniCore was
our first BERT-based large language model. Building on the evolution and advancement of the UniCore in past
years, UniGPT features greater parameter and data scale as well as generative capabilities, and, pre-trained with
massive volume of text and code, it has over 60 billion parameters and possesses strong general abilities.
Core Technologies and Applications
Large Language Model (LLM)
Our large language model UniGPT is the core of UniBrain, which determines the cognitive and business
processing capabilities of the system and is the key to our MaaS-based business model. Interaction systems using
traditional technologies often struggle to understand natural language expressions of users. For a well-calibrated
system, even minor changes in user expression or the need to use contextual relations could easily lead to system
failures. Large language models have remarkable advantages in understanding and generating natural languages.
They enable a human machine interaction system to more easily understand varied user expressions, either in voice
or text, and produce more human-like responses, offering accurate, easy-to-use and efficient user experience.
4


--- page 14 ---
SUMMARY
Industry-scale Knowledge Graphs
Industry knowledge graph is a core component for cognitive intelligence, which, when combined with
UniGPT, can effectively improve the accuracy and reliability of industry knowledge and solve industry
problems. Common knowledge about people’s lives, various rules and systems of architectural spaces and even
different departments of science knowledge can all be structuralized and graphed. When performing human-
machine interaction tasks, AI can refer to the content in the knowledge graph, allowing the system to provide
reasonable, effective and specific responses. For example, location information of subway stations can be pre-
stored in the knowledge graph. When a user inquires the location of the restroom, the system, after understanding
the inquiry, can retrieve the information from the knowledge graph and then use natural language generation to
produce text information and deliver such information to the user via voice response. Similarly, through the
machine learning process performed on a great scale of medical knowledge, AI can develop systematic
understanding of medicine and provide process management and decision-making support.
Multimodal Perception and Generation
Our multimodal perception and generation cover the chain of communication that starts from perception
of external signals and ends with production of signals from response, facilitating the AI-enabled communication
methods supported by our conversational AI core technology. This technology can be exemplified by the
ticketing machines along the Shenzhen Metro Line 20. The machine uses computer vision to perceive whether
there is a user in front. If a user is detected, the dialog function is activated; if not, the machine remains silent.
Once activated, the machine uses a microphone array to capture the user’s voice, analyze the content of the
speech, understand the user’s intent and provide response or perform the corresponding operation. This is a
typical process of multimodal perception. During the dialog with the user, the machine can perform certain
operations, display results or text on the screen or provide hints and feedback to the user via voice. Voice
electronic medical record entry is another typical voice input scenario. The machine perceives the doctor’s voice
through the microphone and extracts the effective information from the voice to form text. AI, based on its
understanding of the text, then offers suggestions to optimize the content.
One-stop IoT Interconnection System
We have developed a one-stop IoT interconnection system where all the relevant spaces, devices, users
and services are interconnected for specific application scenarios to redefine the organic interactions among
people, events and objects. This system is primarily used in Daily Life scenarios. Consider smart home as an
example: the endpoints of this system are various IoT devices, including execution devices such as lights, air
conditioners and fans, and sensors such as temperature meters, action detectors and smoke detectors. The center
of this system is the IoT system, and the endpoints and center are inter-connected via the Internet, among others.
The system also comprises various terminals that interact with end users and various business systems that deal
with operators, if any. For example, a user feels too cold and says to the interaction terminal via voice that the
temperature needs to be raised. The system understands the user’s intention and adjusts the temperature.
Meanwhile, the temperature sensors at various locations continuously transmit data to the IoT center via the
Internet. The AI center, according to the knowledge graph, determines that even if the temperature is adjusted
according to the user’s requirements, the temperature in some areas may still be abnormal. Therefore, it
automatically files an anomaly alert commanding specific maintenance personnel to check and resolve the issue.
See “Business - UniBrain - UniGPT - AI Components” for a detailed explanation on our core technologies and
applications.
Financial Overview
During the Track Record Period, our revenue was primarily derived from the sales of AI products and
solutions. Our revenue increased from RMB600.6 million in 2022, to RMB939.0 million in 2024, with a CAGR
of 25.0%; our gross profit increased from RMB239.9 million in 2022 to RMB364.5 million in 2024, with a
CAGR of 23.3%; our net losses in 2022, 2023 and 2024 were RMB375.4 million, RMB376.2 million and
RMB454.2 million respectively; and adding back share-based payment expenses, finance cost of interest on
redemption liabilities and listing expenses, our adjusted net losses (non-IFRS financial measure) for 2022, 2023
and 2024 were RMB183.2 million, RMB136.6 million and RMB168.4 million respectively.
5


--- page 15 ---
SUMMARY
OUR STRENGTHS
We believe the following competitive strengths have contributed to our success and distinguished us from
our competitors:
Š Early entrant in AGI technologies, consistently ranking as the fourth largest AI solution provider by
revenue with a market share of 0.6% in China in each year of the Track Record Period;
Š R&D and productization capabilities powered by solid infrastructure;
Š Extensive and in-depth collaboration underpinning commercialization success;
Š Feedback loop continuously driving technology and product advancement; and
Š Experienced management team and core personnel.
See “Business – Our Strengths.”
OUR STRATEGIES
We plan to pursue the following strategies to realize the foregoing:
Š Enhancing AI infrastructure and models;
Š Attracting and nurturing AI talents;
Š Expanding application scenarios and industry verticals; and
Š Expanding internationally.
See “Business – Our Strategies.”
OUR CUSTOMERS AND SUPPLIERS
We have a large customer base and we do not rely on any single customer. During the Track Record
Period, we generated substantially all of our revenue from the PRC. In 2022, 2023 and 2024 revenue from our
largest customer in each year during the Track Record Period accounted for 13.1%, 9.3% and 7.0% respectively,
of our total revenues during those years. In 2022, 2023 and 2024 revenue from our five largest customers in each
year during the Track Record Period accounted for 30.8%, 27.4% and 26.7% respectively, of our total revenues
during the same years. See “Business – Customers.”
Our suppliers include reputable providers of hardware component, such as modules and chips, software,
R&D and marketing service. In 2022, 2023 and 2024, charges from our largest supplier in each year during the
Track Record Period accounted for 20.8%, 18.0% and 12.6% respectively, of our total purchase during those
years. In 2022, 2023 and 2024 charges from our five largest suppliers in each year during the Track Record
Period accounted for 46.2%, 43.4% and 44.2% respectively, of our total purchase during the same years. See
“Business – Suppliers.”
COMPETITION
The AI solutions industry in which we operate is highly competitive. According to Frost & Sullivan, AI
solution providers compete with one another and traditional solution providers based on factors including (i) top
AI research talent pool, (ii) self-developed and powerful AI infrastructure, and (iii) industry and customer
coverage. See “Industry Overview.” We primarily compete with other companies that focus on developing and
commercializing AI products and solutions. With respect to each industry vertical that we have entered, we also
compete against providers of traditional solutions which are not AI-driven in such vertical. We may also in the
future face competition from new entrants that will increase the competition. For example, more established
technology companies that possess substantial financial resources, sophisticated technological capabilities and
broad sales channels may develop solutions that directly compete with ours. See “Industry Overview.”
We believe that the following key edges set us apart from our competitors.
Š Technology roadmap;
Š Technological early mover;
Š Self-developed Atlas AI infrastructure;
6


--- page 16 ---
SUMMARY
Š Customer base; and
Š Talent pool.
RISK FACTORS
Our business operation involves certain risks and uncertainties, which are set out in the section headed
“Risk Factors.” You should read that section in its entirety carefully before you decide to invest in our Offer
Share. Some of the major risks we face include:
Š The industries in which we operate are characterized by constant changes. We may not be able to
continuously develop and innovate our technologies and provide products and solutions that meet the
expectations of customers;
Š We are subject to credit risk related to delay in payment and defaults of customers


Š We may not be able to compete successfully against current or future competitors;
Š We had net losses, net liabilities and net cash outflows in operating activities during the Track
Record Period, and may not be able to achieve or subsequently maintain profitability in the future;
Š Our recent growth is not necessarily indicative of our future performance, and we may not be able to
sustain our revenue growth rate in the future;
Š The AI industry is subject to evolving and extensive regulation in China. Future laws and regulations
may impose additional requirements and other obligations that could materially and adversely affect
our business, financial condition and results of operations;
Š We are subject to complex and evolving laws, regulations and governmental policies regarding data
security, privacy and personal information. Actual or alleged failure to comply with privacy and data
protection laws, regulations and governmental policies could damage our reputation, deter current
and potential customers from using our products and solutions and could subject us to significant
legal, financial and operational consequences.
Š We may not be able to retain existing customers, attract new ones or increase their spending;
Š We are subject to risk related to the prolonged cash conversion cycle;
Š We may fail to manage our inventory effectively;
Š Our business depends substantially on the continuing efforts of our management and other key
personnel, as well as a competent pool of talents that support our operations and future growth, and
we may not be able to retain, attract, recruit and train such personnel; and
APPLICATION FOR LISTING ON THE STOCK EXCHANGE
We have applied to the Stock Exchange for the granting of the listing of our H Shares pursuant to (i) the
Global Offering (including any H Shares which may be issued pursuant to the exercise of the Over-allotment
Option), and (ii) the H Shares to be converted from our existing Domestic Unlisted Shares and Unlisted Foreign
Shares on the basis that, among other things, we satisfy the market capitalization/revenue test under Rule 8.05(3)
of the Listing Rules with reference to: (i) our revenue of RMB939.0 million (equivalent to approximately
HK$1,016.8 million) in the financial year ended December 31, 2024 exceeds HK$500 million, and (ii) our
expected market capitalization at the time of Listing, which, based on the low-end of the indicative offer price
range, exceeds HK$4,000,000,000.
7


--- page 17 ---
SUMMARY
PRINCIPAL COMPONENTS OF OUR CONSOLIDATED STATEMENTS OF COMPREHENSIVE
LOSS
The following table sets out a summary of our consolidated statements of comprehensive loss for the
years indicated:
Year ended December 31,
2022 2023 2024
(RMB in thousands)
Revenue ........................................................ 600,619 727,316 939,017
Cost of sales and services ........................................... (360,732) (432,808) (574,537)
Gross profit ..................................................... 239,887 294,508 364,480
Operating expenses:
Research and development expenses .................................. (287,099) (286,301) (370,073)
Selling and marketing expenses ...................................... (46,086) (58,810) (70,705)
Administrative expenses ........................................... ( 48,420) (65,020) (64,105)
Net impairment losses on financial assets and contract assets ............... ( 71,976) (91,346) (48,438)
Other income .................................................... 15,746 36,313 17,077
Other (losses)/gains - net ........................................... ( 1,363) 10,579 (13,964)
Total operating expenses .......................................... (439,198) (454,585) (550,208)
Finance income .................................................. 3 1 4 1,875 2,298
Finance costs .................................................... ( 177,675) (212,770) (270,943)
Finance costs-net ................................................ (177,361) (210,895) (268,645)
Share of profit/(loss) from investments accounted for using the equity
method ....................................................... 1,092 (2,617) —
Loss before income tax ............................................ (375,580) (373,589) (454,373)
Income tax credit/(expense) ......................................... 1 8 9 ( 2,655) 162
Loss for the year ................................................. (375,391) (376,244) (454,211)
Loss for the year attributable to:
- Owners of the Company .......................................... ( 366,012) (375,461) (452,364)
- Non-controlling interests .......................................... ( 9,379) (783) (1,847)
(375,391) (376,244) (454,211)
Non-IFRS Financial Measure
To supplement our consolidated financial statements presented in accordance with IFRS, we use adjusted
net loss (non-IFRS financial measure) as additional financial measure, which is not required by, or presented in
accordance with, IFRS. We believe that this non-IFRS measure facilitates comparisons of operating performance
from period to period and company to company by eliminating potential impacts of items. We believe that this
measure provides useful information to investors in understanding and evaluating our consolidated results of
operations in the same manner as they help our management. However, presentation of adjusted net loss
(non-IFRS financial measure) may not be comparable to similarly titled measures presented by other companies.
The use of this non-IFRS measure has limitations as an analytical tool, and investors should not consider it in
isolation from, or as a substitute for analysis of, our results of operations or financial conditions as reported under
IFRS.
8


--- page 18 ---
SUMMARY
We define adjusted net loss (non-IFRS financial measure) as net loss for the year adjusted by adding back
share-based payment expenses, finance cost of interest on redemption liabilities, and listing expenses. The
following table sets forth a reconciliation of our non-IFRS financial measure for the years indicated to the nearest
measure prepared in accordance with IFRS which is net loss for the year:
Year ended December 31,
2022 2023 2024
(RMB in thousands)
Loss for the year ............................................... (375,391) (376,244) (454,211)
Add:
Share-based payment expenses to employees (1) ........................ - 4,532 -
Finance cost of interest on redemption liabilities (2) ...................... 176,429 208,845 264,595
Listing expenses(3) ............................................... 15,757 26,276 21,234
Adjusted net loss for the year (non-IFRS financial measure) ........... (183,205) (136,591) (168,382)
Notes:
(1) Share-based payment expenses to employees represent the arrangement whereby we receive services from employees as consideration
for our equity instruments. Such expenses are not expected to result in future cash payments.
(2) Finance cost of interest on redemption liabilities represents the non-cash, interest expense recorded to reflect interest incurred on our
conditional obligation to redeem equity securities issued in our previous financing of Series. This redemption obligation was initially
measured at net present value of the redemption obligation amount and recorded as a financial liability and incurred interest. We will not
incur such finance cost upon Listing.
(3) Listing expenses relate to our Global Offering.
We have experienced continuous revenue growth during the Track Record Period. Our revenue increased
from RMB600.6 million in 2022 to RMB727.3 million in 2023 and further increased to RMB939.0 million in
2024, as we expanded into new industry verticals and offered a wider range of AI solutions. Our net losses in
2022, 2023 and 2024 were RMB375.4 million, RMB376.2 million and RMB454.2 million, primarily because we
incurred significant amounts of R&D expenses during the Track Record Period as our business grew rapidly.
While we have started to implement prudent measures to manage our costs and operating expenses, we currently
expect such positions may continue until we achieve a greater scale.
BUSINESS SUSTAINABILITY
We have experienced continuous revenue growth during the Track Record Period. Our revenue increased
from RMB600.6 million in 2022 to 727.3 million in 2023 and further increased to RMB939.0 million in 2024.
Our gross profit margin remained relatively stable at 39.9%, 40.5% and 38.8% in 2022, 2023 and 2024,
respectively. During the Track Record Period, our customers increased from 538 in 2022 to 555 in 2023 and
further increased to 576 in 2024. This was primarily as a result of the increase in the wide variety of AI solutions
and products we offered and the increase in their applicable industries, as well as the increased demand for
intelligent medical solutions along with the intelligence upgrade of internal systems among hospitals. The
number of our Major Customers increased from 92 in 2022, to 104 in 2023 and further increased to 106 in 2024.
Our revenue from Major Customers increased from RMB538.6 million in 2022, to RMB666.4 million in 2023,
and further increased to RMB875.1 million in 2024. Our long-term strategy of optimizing customer base and
focusing on major customers has proved to be effective. It drove our rapid revenue growth while helped us
maintain a stable gross profit margin, underpinning sustainable growth. Our capability in enhancing AI
technologies to deliver targeted and innovative AI products and solutions that meet evolving customer needs,
combined with our success in expanding our customer base and deepening customer relationships, ensures that
we can achieve long-term and sustainable business growth.
We have maintained our market position as one of the leading players in China’s AI solution industry.
According to Frost & Sullivan, despite the intense competition within the industry, we have ranked among the
top five market players by revenue in each year of the Track Record Period. During the Track Record Period, our
market share stood stably at 0.6%, ranking fourth in China’s AI solution industry. The combined market share of
the top three players declined significantly from 22.0% in 2022 to 13.8% in 2024, indicating reduced
concentration. We have also accelerated our R&D investments in 2024 to maintain our competitiveness. Since
January, 2025, China’s AI solution industry has seen significant new demands for cutting-edge technologies, and
9


--- page 19 ---
SUMMARY
is growing at an accelerated pace, according to Frost & Sullivan. Considering the above factors, we believe that
we are well-positioned to capture increasing market opportunities and enhance our market position.
We expect to increase market share by enhancing the integration of our offerings with customers’
evolving businesses. Our early-mover advantage and reputation in AGI technology and ability to support a
diverse range of products and solutions in various end markets, combined with our experience accumulated from
years of practice in the AI market, form the competitive edge underpinning our further expansion. According to
Frost & Sullivan, the market size of AI solution in Daily Life provided by AI solution providers in China
increased from RMB3.0 billion in 2019 to RMB10.5 billion in 2024, growing at a CAGR of 28.7%, and is
expected to reach RMB149.6 billion in 2030 with a CAGR of 55.7% from 2024 to 2030; the market size of AI
Service and Solution in Healthcare in China increased from RMB1.1 billion in 2019 to RMB9.9 billion in 2024,
growing at a CAGR of 54.3%, and is expected to reach RMB146.5 billion in 2030 with a CAGR of 56.6% from
2024 to 2030.
Eliminating the impact of items including (i) share-based payment expenses; (ii) finance cost of interest
on redemption liabilities; and (iii) listing expenses, we recorded an adjusted net loss (non- IFRS financial
measure) of RMB183.2 million, RMB136.6 million and RMB168.4 million in 2022, 2023 and 2024,
respectively, accounting for 30.5%, 18.8%, and 17.9% of our revenue for the same year, respectively. Adjusted
net loss is a non-IFRS measure. See “Financial Information — Non-IFRS Financial Measure.” Our net losses
were primarily due to the significant amounts of R&D expenses incurred during the Track Record Period. The
absolute amount of our R&D expenses increased during the Track Record Period as our business grew. We have
started to implement prudent measures to manage our costs and operating expenses. We closely monitor the
adequacy of our cash position in light of our business operations and future expansion.
Going forward, we aim to achieve profitability primarily through the following measures:
(I) Continually enhance and enrich our products and solutions. We continually enhance and enrich
our products and solutions and diversify our product portfolio leveraging the enhancement of Atlas AI
infrastructure and UniBrain technology platform, which are expected to elevate our R&D efficiency and
accelerate the iterations of our products and solutions.
(II) Expanding customer base and retaining existing customers. By leveraging the expertise gained
from working with lighthouse customers and the capabilities empowered by Atlas AI infrastructure and UniBrain
technology platforms, we plan to (i) extend our solutions for existing application scenarios, which are highly
replicable, to new customers and (ii) extend our solutions for new application scenarios to existing customers.
(III) Cost control by enhancing economies of scale and operational efficiency. Since our inception,
we have been actively engaged in advancing AI technologies and driving innovation within the industry. Despite
operating at a loss primarily due to the significant amount of R&D costs, we believe that our strategic investment
in the improvement of AI technologies will position us favorably in the competitive AI landscape and contribute
to our long-term success. Our commitment to R&D has already demonstrated promising results, with our revenue
increasing consistently during the Track Record Period. This growth is a direct result of our strong technology
capabilities, which we anticipate will continue to yield long-term benefits. With our increased R&D efficiency
and the expanding scale of operation, we also expect to benefit from the economies of scale.
See “Business — Business Sustainability.”
10


--- page 20 ---
SUMMARY
DESCRIPTION OF CERTAIN COMPONENTS OF OUR CONSOLIDATED STATEMENTS OF
FINANCIAL POSITION
As of December 31,
2022 2023 2024
(RMB in thousands)
Total current assets ........................................... 515,963 998,269 956,959
Total non-current assets ....................................... 52,881 106,337 123,017
Total current liabilities ........................................ 321,687 333,788 492,625
Total non-current liabilities ..................................... 2,158,395 3,069,575 3,340,259
Net current assets ............................................ 194,276 664,481 464,334
Net liabilities ................................................ (1,911,238) (2,298,757) (2,752,908)
Non-controlling interests ....................................... (20,379) (17,273) (19,120)
Our net current assets decreased from RMB664.5 million as of December 31, 2023 to RMB464.3 million
as of December 31, 2024, mainly reflecting (i) a decrease in the cash and cash equivalents in relation to our cash
outflow to support business operations and (ii) an increase in the borrowings, partially offset by an increase in the
trade receivables. Our net current assets increased from RMB194.3 million as of December 31, 2022 to
RMB664.5 million as of December 31, 2023, primarily due to an increase in total current assets from RMB516.0
million to RMB998.3 million, mainly reflecting (i) an increase in financial assets at fair value through profit or
loss due to purchase of wealth management products, and (ii) an increase in cash and cash equivalents as we
completed the Series D3 financing in 2023.
Our net liabilities increased from RMB1,911.2 million as of December 31, 2022 to RMB2,298.8 million
as of December 31, 2023, primarily due to recognition of redemption liabilities for the redemption rights newly
granted to Series D3 investors. We expect to achieve a net assets position upon Listing, as the redemption
liabilities will be derecognized and the carrying amount will then be credited into equity. Our net liabilities
further increased to RMB2,752.9 million as of December 31, 2024, primarily due to (i) an increase in redemption
liabilities and (ii) an increase in net losses.
CASH FLOW
The following table sets out our cash flows for the years indicated:
Year Ended December 31,
2022 2023 2024
(RMB in thousands)
Cash used in operations ............................................ (165,941) (284,666) (316,778)
Add:
Interest received .................................................. 3 1 4 1,875 2,298
Income tax paid .................................................. — (1,324) (957)
Addition of restricted cash .......................................... — — (3,541)
Net cash used in operating activities ................................. (165,627) (284,115) (318,978)
Net cash generated from/(used in) investing activities .................. 80,537 (128,735) 34,869
Net cash generated from financing activities .......................... 29,550 717,975 61,383
Net (decrease)/increase in cash and cash equivalents ................... (55,540) 305,125 (222,726)
Cash and cash equivalents at beginning of the year ....................... 129,650 74,118 379,224
Exchange effect on cash and cash equivalents ........................... 8 (19) (22)
Cash and cash equivalents at the end of the year ...................... 74,118 379,224 156,476
We had net operating cash outflow of RMB165.6 million, RMB284.1 million and RMB319.0 million in
2022, 2023 and 2024, respectively, which was primarily due to our losses before income tax as we incurred
significant R&D expenses. Our trade receivable turnover and inventory turnover also impacted our cash position
and cash conversion cycle given the prolonged period for cash receipt after revenue recognition primarily as a
result of public sector customers with long payment cycles and relatively high inventory turnover days primarily
as a result of contract fulfillment costs arising from ongoing projects that are yet to be delivered to and accepted
by customers by the year end. We had net investing cash outflow of RMB128.7 million in 2023, primarily in
relation to our purchase of investments in financial assets at fair value through profit or loss, including unlisted
equity investments and wealth management products.
11


--- page 21 ---
SUMMARY
We closely monitor the adequacy of our cash position in light of 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. 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, to meet our present needs and for the next twelve months from the date of the
prospectus, after taking into account the financial resources available to us. In addition, we have implemented a
series of strategic measures to manage our prolonged cash conversion cycle and ensure adequate working capital
and improved liquidity. We have strengthened our trade receivable management by conducting regular aging
analyzes to monitor receivables, with particular focus on customers with extended payment patterns, such as
public sector customers. We maintain an early warning system that flags accounts with prolonged collection
periods, assigning dedicated account managers to proactively engage with these customers through structured
follow-ups, dynamically monitor their status, negotiate repayment plans with customers and take legal action
when necessary. Where warranted by material changes in a customer’s financial condition, we escalate collection
efforts accordingly. Meanwhile, we have refined our client selection process to prioritize partnerships with
financially stable customers, which ensures the security of future receivables. Payment terms have also been
optimized by increasing customer prepayments, shortening payment cycles and aligning project implementation
with payment performance for long-term clients. To further optimize and expedite collections, we have
streamlined our invoicing process by actively adopting e-invoicing and reducing reliance on paper-based
invoices, accelerating invoice delivery and processing times. We are also improving inventory turnover and
supply chain management by negotiating more flexible payment terms with suppliers. We maintain strong
relationships with banks and financial institutions to secure and fully utilize available credit facilities, ensuring
access to necessary funding. Taking into account the independent due diligence conducted by the Joint Sponsors,
and based on the written confirmation from the Company in respect of working capital sufficiency, review of the
accountants’ report and the Company’s indebtedness status, the financial due diligence conducted on the
historical financial information of the Group during the Track Record Period and the discussion with the
Directors, nothing material has come to the attention of the Joint Sponsors that would cast doubt on the
Company’s conclusion that the Company has sufficient working capital to meet its present needs and at least for
the next twelve months from the date of this prospectus.
KEY FINANCIAL RATIOS
The following table sets out our key financial ratios for the years indicated:
Year ended
December 31,
2022 2023 2024
Revenue growth (%) ........................................................ 31.8 21.1 29.1
Gross profit margin (1) ( % ) ................................................... 39.9 40.5 38.8
Gross profit growth (%) ..................................................... 65.4 22.8 23.8
Net loss margin (2) ( % ) ...................................................... (62.5) (51.7) (48.4)
Adjusted net margin (3) (non-IFRS financial measure) (%) .......................... (30.5) (18.8) (17.9)
Notes:
(1) Gross profit margin equals gross profit divided by revenue for the year and multiplied by 100%.
(2) Net loss margin equals net loss divided by revenue for the year and multiplied by 100%.
(3) Adjusted net margin (non-IFRS financial measure) equals adjusted net loss (non-IFRS financial measure) divided by revenue for the year
and multiplied by 100%.
OUR CONTROLLING SHAREHOLDERS
As of the Latest Practicable Date, Dr. Liang, Dr. Huang and Dr. Kang, by virtue of the acting-in-concert
arrangement among them, were collectively interested in approximately 33.93% of our total issued share capital,
including (i) 3.78% of our total issued share capital directly held by Dr. Liang, (ii) 24.08% and 3.80% of our total
issued share capital controlled by Dr. Huang indirectly through Yunsi Shangyi and Yunchuang Hudong,
respectively, both of which have Tianjin Yunsheng (which is held by Dr. Huang as to 99%) as their respective
general partner, and (iii) 2.27% of our total issued share capital directly held by Dr. Kang. Immediately following
the completion of the Global Offering (assuming the Over-allotment Option is not exercised), Dr. Liang, Dr. Huang
and Dr. Kang will, directly and indirectly through Tianjin Yunsheng, Yunchuang Hudong and Yunsi Shangyi,
12


--- page 22 ---
SUMMARY
continue to control in aggregate approximately 33.18% of our total issued share capital. Therefore, they will remain
as our Controlling Shareholders upon Listing. See “Hist ory, Development and Corporate Structure – The
Controlling Shareholders” and “Relationship with Our Controlling Shareholders” for details.
OFFERING STATISTICS
All statistics in the following table are based on the assumptions that (i) the Global Offering has been
completed and 1,560,980 H Shares are issued pursuant to the Global Offering; (ii) 70,953,453 Shares are issued
and outstanding following the completion of the Global Offering saved as disclosed in note (2) below; and (iii)
conversion of Domestic Unlisted Shares and Unlisted Foreign Shares into H Shares, and that the Over-allotment
Option is not exercised.
Based on an Offer Price of
HK$165.00 per Share
Based on an Offer Price of
HK$205.00 per Share
Market capitalization of our Shares (1) ............. H K $ 11,707.3 million HK$14,545.5 million
Unaudited pro forma adjusted consolidated net
tangible assets per Share (2) ................... H K $ 11.68 HK$ 12.52
(1) The calculation of market capitalization is based on 1,560,980 H Shares expected to be issued pursuant to the Global Offering and totally
70,953,453 Shares in issue immediately upon completion of the Global Offering presuming the conversion of Domestic Unlisted Shares
and Unlisted Foreign Shares into H Shares, and that the Over-allotment Option is not exercised.
(2) The unaudited pro forma adjusted consolidated net tangible assets per Share as of December 31, 2024 is calculated after making the
adjustments referred to in Appendix II to this prospectus, and based on 70,953,453 Shares are in issue, assuming the Global Offering had
been completed on December 31, 2024, without taking into account any shares which may fall to be issued upon the exercise of the
Over-Allotment Option.
(3) As described in note 30(i) of the Accountant’s Report set forth in Appendix I to the prospectus, the preferred rights granted to all
investors shall be irretrievably terminated upon the Listing and completion of the Global Offering. Accordingly, the carrying amount of
the related redemption liabilities of RMB3,303,051,000 had been derecognized and credited to the equity attributed to the owners of the
Company as of December 31, 2024.
For the calculation of the unaudited pro forma adjusted consolidated net tangible assets per Share
attributable to our Shareholders, see “Appendix II – Unaudited Pro Forma Statement of Adjusted Net Tangible
Assets.”
DIVIDENDS
No dividend was paid or declared by our Company or other entities comprising our Group during the
Track Record Period. Currently, we have not implemented policy to fix the dividend distribution ratio.
Any future declarations and payments of dividends will be at the absolute discretion of our Directors and
will depend on our actual and expected results of operations, cash flow and financial position, general business
conditions and business strategies, expected working capital requirements and future expansion plans, legal,
regulatory and other contractual restrictions, and other factors which our Directors consider relevant. As advised
by our PRC Legal Advisors, no dividend shall be declared or payable except out of our profits and reserves
lawfully available for distribution. 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. Our
Shareholders in a general meeting may approve any declaration of dividends recommended by our Board.
LISTING EXPENSES
Listing expenses represent professional fees, underwriting commission, and other fees incurred in
connection with the Global Offering. We estimate that our listing expenses, including underwriting commission for
the Global Offering, will be approximately HK$112.2 million (including (i) underwriting commission of
approximately HK$11.6 million, and (ii) non-underwriting related expenses of approximately HK$100.6 million,
which consist of fees and expenses of legal advisors and Reporting Accountant, of approximately HK$73.7 million
and other fees and expenses of approximately HK$26.9 million), representing approximately 38.84% of the gross
proceeds from the Global Offering, (assuming an Offer Price of HK$185.00 per Offer Share (being the mid-point of
the indicative Offer Price range) and no exercise of the Over-allotment Option). Among the total listing expenses,
approximately HK$17.1 million is directly attributable to the issue of our Offer Shares to the public and will be
deducted from equity, HK$69.1 million has been expensed as of December 31, 2024 and the remaining amount of
approximately HK$26.0 million is expected to be expensed upon the Listing.
13


--- page 23 ---
SUMMARY
RECENT DEVELOPMENT
Business Development
According to the management accounts, our revenue for the three months ended March 31, 2025
increased by approximately 25.0% compared to the same period in 2024. Save as otherwise disclosed below, our
Directors confirm that, as of the date of this prospectus, there has been no material adverse change in our
financial position or prospects since December 31, 2024, being the latest date of our consolidated financial
statements as set out in Appendix I to this prospectus, and there is no event since December 31, 2024 that would
materially affect the information as set out in the Accountant’s Report included in Appendix I to this prospectus.
We closely monitor the adequacy of our cash position in light of our business operations and future
expansion. Taking into account the financial resources available to us including our cash and cash equivalents on
hand, unutilized bank facilities and the estimated net proceeds from the Global Offering, our directors are of the
view that we have sufficient working capital to meet our present requirements and for the next 12 months from
the date of this prospectus.
We expect to have net losses for the year ending December 31, 2025 and in the near future, primarily due
to (i) our continuous investment in R&D activities, and (ii) finance cost of interest on redemption liabilities,
incurred on our conditional obligation to redeem equity securities issued in our previous financing of Series. We
also expect to have net operating cash outflows in 2025, primarily due to the expected loss before tax position.
Regulations Related to our Business Operations
Measures on Generative AI Services
On July 10, 2023, the Cyberspace Administration of China (“CAC”) issued the Interim Measures for the
Administration of Generative Artificial Intelligence Services (
) (the
“Measures on Generative AI Services ”) to regulate the generative artificial intelligence industry in China. See
“Regulatory Overview - Regulations and Policies on Artificial Intelligence Technologies.”
The Measures on Generative AI Services apply to service providers that use generative AI technologies to
provide services that can generate texts, pictures, audio, videos and other content to the public in China. We are
subject to the Measures on Generative AI Services as we have incorporated UniGPT in our Daily Life and
Healthcare products and solutions, which involves generative artificial intelligence technologies and algorithms.
As of the Latest Practicable Date, we have adopted a series of measures to comply with the Measures on
Generative AI Services, including but not limited to (i) conducting content vetting, including manual and machine
review of the input data and timely disposing any illegal or harmful information in these data and results; (ii)
implementing internal rules and procedures with respect to algorithm security assessment and management; (iii)
providing channels for complaints and reports of illegal information; and (iv) engaging an algorithm security officer to
coordinate algorithm governance work. In addition, we have completed the algorithm filing for our algorithms used in
our products and solutions with the CAC and the security assessment for our products and solutions related to UniGPT.
In accordance with the Measures on Generative AI Services, such filing and assessment apply to generative AI services
with public opinion attributes or social mobilization ability. Although our services are not designed to possess these
characteristics, we have prudently completed these procedures. This decision was made out of caution, given that the
Measures on Generative AI Services are newly issued, it remains uncertain as to whether our services would be
regarded as capturing features related to public opinion attribute or social mobilization ability, which will subject us to
complete the algorithm filing and security assessment in accordance with relevant laws and regulations. Up to the
Latest Practicable Date, we have not launched or delivered any new products or solutions that require separate
assessment or filing. See “Business – Data Security and Privacy” for details. As a result, we do not foresee any material
legal impediment to comply with the requirements related to security assessment under the Measures on Generative AI
Services.
Based on the foregoing, our PRC legal advisors as to data security law and our Directors are of the view that,
during the Track Record Period and up to the Latest Practicable Date, we are in compliance with the Measures on
Generative AI Services and relevant regulations on the management of generative AI services in all material aspects
and there is no material discrepancy between applicable requirements under such regulations and our current practices.
14


--- page 24 ---
SUMMARY
Our Directors are of the view that the aforementioned regulations would not have a material adverse impact on our
business operations and financial conditions. Having considered the views and basis of our Directors and our PRC
legal advisor as to data security law, based on the due diligence conducted by the Joint Sponsors, nothing else has
come to the attention of the Joint Sponsors that would reasonably cause them to cast doubt on the reasonableness of the
above views of our Directors and our PRC legal advisor as to data security law in any material aspect.
Cybersecurity Review Measures and Data Security Regulations
We mainly process data related to customers and end users. As advised by our PRC legal advisor as to
data security law, we are subject to the laws and regulations relating to cybersecurity and data security
protection, data privacy, and algorithm compliance as our products and solutions as well as UniGPT involve AI
technologies and algorithms. See “Regulatory Overview—Regulations on Cyber Security and Data Protection”
and “Regulatory Overview—Regulations and Policies on Artificial Intelligence Technologies.”
As of the Latest Practicable Date, we had not been involved in any investigations on cybersecurity review
by the CAC, nor had we received any regulatory inquiries, notice, warnings, sanctions or penalties in relation to
cybersecurity and data protections regulations. Our Directors and PRC Legal Advisors are of the view that,
during the Track Record Period and up to the Latest Practicable Date, we had been in compliance with applicable
laws and regulations on cybersecurity and data security in all material respects in the PRC. In addition, our
Directors are of the view that the aforementioned laws and regulations did not and will not materially affect our
Group’s operations and financial performance. Based on the independent due diligence conducted by the Joint
Sponsors and having considered the views and basis of our Directors and our PRC legal advisor as to data
security law as disclosed in this prospectus, nothing has come to the attention of the Joint Sponsors that would
reasonably cause the Joint Sponsors to cast doubt on the reasonableness of the views of our Directors and our
PRC legal advisor as to data security law in any material aspect.
The Proposed Rulemaking of the U.S. Government Regarding Outbound Investment Restriction
On October 28, 2024, the Department of the Treasury issued the Provisions Pertaining to U.S. Investments
in Certain National Security Technologies and Products in Countries of Concern (the “Final Rule”), which became
effective on January 2, 2025. The Final Rule implements a regulatory framework for certain U.S. investments into
China (including Hong Kong and Macau) in entities engaged in activities involving sensitive technologies critical to
national securities in three sectors, namely, semiconductors and microelectronics, quantum information
technologies, and certain artificial intelligence systems with applications that pose national security risks. The
program would prohibit U.S. persons from undertaking certain transactions and require notification by U.S. persons
on certain investments. As our AI products and solutions are primarily used in Daily Life and Healthcare scenarios
to help enterprises improve their operational efficiency and service quality and reduce the management costs, we do
not expect investments into our business would be prohibited or subject to the notification requirement.
Nevertheless, we cannot guarantee that the rule will not negatively affect overall investor sentiment and potentially
discourage investment in our Company. See “Risk Factors – We might be subject to the risks associated with
international trade policies, geopolitics and trade protection measures, and our business, results of operations,
financial conditions and prospects could be adversely affected.”
Regulatory Developments on Overseas Offering and Listing
Cybersecurity Review
According to the Cybersecurity Review Measures (2021 Version) (
ج2021)) (the
“Cybersecurity Review Measures ”) issued by the CAC, the NDRC , the MIIT, and several other PRC
governmental authorities on December 28, 2021 and became effective on February 15, 2022, online platform
operators possessing personal information of more than one million users seeking to be listed on a foreign stock
exchange (
਷̮ɪ̹) must apply for a cybersecurity review. Our PRC Legal Advisors are of the view that the
term of “listing on a foreign stock exchange ( ਷̮ɪ̹)” under the Cybersecurity Review Measures does not
include “listing in Hong Kong,” and therefore we are not subject to the mandatory obligation of ex ante
application for cybersecurity review for the Listing.
15


--- page 25 ---
SUMMARY
CSRC Filings
On February 17, 2023, the Chinese Securities Regulatory Commission (the “ CSRC”) issued the Trial
Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies ( ྤʫΆุྤ̮
) (the “ Overseas Listing Regulations ”), and five supporting guidelines, which
became effective on March 31, 2023. Pursuant to the Overseas Listing Regulations, companies in mainland
China that directly or indirectly offer or list their securities in an overseas market, including a company in
mainland China limited by shares and an offshore company whose main business operations are in mainland
China and intends to offer shares or be listed in an overseas market based on its equities, assets or similar
interests in mainland China are required to file with the CSRC within three business days after submitting their
listing application documents to the regulator in the place of intended listing.
Under the requirements of Overseas Listing Regulations, we had filed with the CSRC within three
working days after we submitted the listing application to the Hong Kong Stock Exchange. On April 14, 2025,
the CSRC issued a notification confirming our completion of the filing pursuant to the Overseas Listing
Regulations for the Global Offering. In addition, we will perform the reporting obligations to the CSRC in the
event of any occurrence of material events to comply with the Overseas Listing Regulations. See “Risk Factors
— We may be subject to the approval or other requirements of the CSRC or other PRC governmental authorities
in connection with future capital raising activities.”
USE OF PROCEEDS
Assuming an Offer Price of HK$185.00 per Offer Share (being the mid-point of the Offer Price range),
we estimate that we will receive net proceeds of approximately HK$176.6 million from the Global Offering after
deducting the underwriting commissions and other estimated expenses in connection with the Global Offering
and assuming that the Over-allotment Option is not exercised. In line with our strategies, we intend to use our
proceeds from the Global Offering for the purposes and in the amounts set forth below:
Š Approximately 45.6% or HK$80.5 million, for enhancing our research and development capabilities over
the next five years, with the detailed breakdown of the proceeds to be allocated as follows:
O Approximately 30.8% or HK$54.4 million will be allocated to invest in our Atlas AI infrastructure;
O Approximately 7.7% or HK$13.6 million will be allocated to upgrade our UniBrain to further
enhance our AI development capabilities; and
O Approximately 7.1% or HK$12.5 million will be allocated to cultivate talents and conduct R&D
collaboration.
Š Approximately 47.0% or HK$83.0 million will be allocated to invest in emerging business opportunities and
increase adoption and penetration of our products across industry verticals and scenarios over the next five
years, with the detailed breakdown of the proceeds to be allocated as follows:
O Approximately 13.9% or HK$24.6 million will be allocated to improve our existing Daily Life and
Healthcare solutions; and
O Approximately 33.1% or HK$8.4 million will be allocated to explore business opportunities and
further penetrate into emerging verticals.
Š Approximately 7.4% or HK$13.1 million will be allocated to working capital and general corporate
purposes.
16


--- page 26 ---
DEFINITIONS
In this Prospectus, unless the context otherwise requires, the following terms shall have
the meanings set out below. Certain other terms are explained in the section headed “Glossary of
Technical Terms” in this Prospectus.
“2016 Employee Incentive Scheme” the share incentive scheme of the Company adopted by a
resolution of our Shareholders on June 5, 2020 as an
amendment, restatement and consolidation of the previous
employee share incentive scheme adopted by the Company
since 2016, a summary of principal terms of which is set
out in “Statutory and General Information – D. Employee
Incentive Schemes – 1. 2016 Employee Incentive Scheme”
in Appendix VI to this prospectus
“2023 Employee Incentive Scheme” the share incentive scheme of the Company as adopted on
April 12, 2023, a summary of principal terms of which is
set out in “Statutory and General Information – D.
Employee Incentive Schemes – 2. 2023 Employee
Incentive Scheme” in Appendix VI to this prospectus
“Accountant’s Report” The accountant’s report of our Company, the text of which
is set out in Appendix I to this prospectus
“AFRC” Accounting and Financial Reporting Council
“Articles” or “Articles of
Association”
the articles of association of our Company, conditionally
adopted on June 25, 2023 with effect from the Listing Date,
and as amended from time to time, a summary of which is
set out in Appendix V to this prospectus
“Board” or “Board of Directors” the board of Directors of our Company
“Business day” or “business day” a day on which banks in Hong Kong are generally open for
normal banking business to the public and which is not a
Saturday, Sunday or public holiday in Hong Kong
“CAC” the Cyberspace Administration of China
“Capital Market Intermediaries” the capital market intermediaries as named in the section
headed “Directors and Parties Involved in the Global
Offering”
“CCASS” the Central Clearing and Settlement System established and
operated by HKSCC
“Chengdu Unisound” Chengdu Unisound AI Technology Co., Ltd. (
ᑊ౽
ʮ̡), a company established PRC with limited
liability on May 20, 2021 and a wholly-owned subsidiary
of our Company
17


--- page 27 ---
DEFINITIONS
“China” or “Mainland China” or “the
PRC”
the People’s Republic of China for the purpose of this
document and for geographical reference only, except
where the context requires, references in this document to
“China”, “Mainland China” and the “PRC” do not apply to
Hong Kong, Macau Special Administrative Region and
Taiwan
“Companies (Winding up and
Miscellaneous Provisions)
Ordinance”
the Companies (Winding up and Miscellaneous Provisions)
Ordinance (Chapter 32 of the Laws of Hong Kong), as
amended, supplemented or otherwise modified from time to
time
“Companies Ordinance” the Companies Ordinance (Chapter 622 of the Laws of
Hong Kong), as amended, supplemented or otherwise
modified from time to time
“Company” or “our Company” or
“the Company”
Unisound AI Technology Co., Ltd. (
΅Ϟ
ʮ̡), a company initially established in the PRC with
limited liability on June 29, 2012, and converted into a joint
stock company with limited liability on June 24, 2019
“Corporate Governance Code” the Corporate Governance Code in Appendix 14 to the
Listing Rules
“CSDC” China Securities Depositary and Clearing Corporation
Limited (
ப΂ʮ̡)
“CSDC (Hong Kong)” China Securities Depository and Clearing (Hong Kong)
Company Limited
“CSRC” the China Securities Regulatory Commission ( ʕ਷ᗇՎ္
ึ)
Controlling Shareholders Dr. Liang, Dr. Huang, Dr. Kang, Tianjin Yunsheng, Yunsi
Shangyi and Yunchuang Hudong, who are in aggregate
expected to be interested in 33.18% of our total issued
share capital upon completion of the Global Offering
(assuming the Over-allotment Option is not exercised)
“Director(s)” director(s) of our Company
“Domestic Unlisted Share(s)” ordinary share(s) issued by the Company, with a nominal
value of RMB1.00 each, which were subscribed for or
credited as paid in Renminbi and held by domestic
Shareholders
“Dr. Huang” Dr. Huang Wei (
රਃ), our executive Director, Chief
Executive Officer and one of our Controlling Shareholders
18


--- page 28 ---
DEFINITIONS
“Dr. Kang” Dr. Kang Heng ( ੰ㛬), our executive Director and one of
our Controlling Shareholders
“Dr. Liang” Dr. Liang Jia’en (ࢸ࢕our Chairman and one of our
Controlling Shareholders
“Employee Incentive Platform(s)” each of Yunchuang Hudong, Yunsi Shangxin and Yunsi
Shangzhi
“Exchange Participant(s)” a person: (a) who, in accordance with the Hong Kong
Listing Rules, may trade on or through the Hong Kong
Stock Exchange; and (b) whose name is entered in a list,
register or roll kept by the Hong Kong Stock Exchange as a
person who may trade on or through the Hong Kong Stock
Exchange
“Extreme Conditions” extreme conditions caused by a super typhoon as
announced by the government of Hong Kong
“FINI” “Fast Interface for New Issuance”, an online platform
operated by HKSCC that is mandatory for admission to
trading and, where applicable, the collection and processing
of specified information on subscription in and settlement
for all New Listings
“Frost & Sullivan” Frost & Sullivan (Beijing) Inc., Shanghai Branch Co., an
independent market research consultant, which is an
Independent Third Party
“Frost & Sullivan Report” a report prepared by Frost & Sullivan on the industry where
the Company operates
“General Rules of HKSCC” General Rules of HKSCC published by the Stock Exchange
and as amended from time to time
“Global Offering” the Hong Kong Public Offering and the International
Offering
“Group” or “our Group” or “we” or
“us”
our Company and its subsidiaries (or our Company and any
one or more of its subsidiaries, as the context may require)
“Hangzhou Unisound” Unisound (Hangzhou) AI Technology Co., Ltd. (
ᑊ(؄
ψ)ʮ̡, a company established in the PRC
with limited liability on June 6, 2023 and a wholly-owned
subsidiary of our Company
“HK$” or “HK dollars” Hong Kong dollars and cents, respectively, the lawful
currency of Hong Kong
19


--- page 29 ---
DEFINITIONS
“HK eIPO White Form ” the application for Hong Kong Offer Shares to be issued in
the applicant’s own name, submitted online through the
designated website at www.hkeipo.hk
“HK eIPO White Form Service
Provider”
the HK eIPO White Form service provider designated by
our Company as specified on the designated website at
www.hkeipo.hk
“HKSCC” Hong Kong Securities Clearing Company Limited, a
wholly owned subsidiary of Hong Kong Exchanges and
Clearing Limited
“HKSCC EIPO” the application for the Hong Kong Offer Shares to be
issued in the name of HKSCC Nominees and deposited
directly into CCASS to be credited to your or a designated
HKSCC Participant’s stock account through causing
HKSCC Nominees to apply on your behalf, by instructing
your broker or custodian who is a HKSCC Participant to
give electronic application instructions via FINI to apply
for the Hong Kong Offer Shares on your behalf
“HKSCC Nominees” HKSCC Nominees Limited, a wholly owned subsidiary of
HKSCC
“HKSCC Operational Procedures” the Operational Procedures of HKSCC in relation to
CCASS, containing the practices, procedures and
administrative requirements relating to operations and
functions of CCASS, as from time to time in force
“HKSCC Participant” a participant admitted to participate in CCASS as a direct
clearing participant, a general clearing participant or a
custodian participant
“Hong Kong Listing Rules” or
“Listing Rules”
the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (as amended from time to
time)
“Hong Kong Offer Shares” the 156,100 H Shares initially offered by our Company for
subscription at the Offer Price pursuant to the Hong Kong
Public Offering (subject to reallocation as described in the
section headed “Structure of the Global Offering” in this
prospectus)
“Hong Kong” or “HK” the Hong Kong Special Administrative Region of the PRC
“Hong Kong Public Offering” the offer of the Hong Kong Offer Shares for subscription
by the public in Hong Kong at the Offer Price (plus
20


--- page 30 ---
DEFINITIONS
brokerage of 1%, SFC transaction levy of 0.0027%, AFRC
transaction levy of 0.00015% and Stock Exchange trading
fee of 0.00565%) on and subject to the terms and
conditions stated in this prospectus, as further described in
the section headed “Structure of the Global Offering – The
Hong Kong Public Offering” in this prospectus
“Hong Kong Stock Exchange” or
“Stock Exchange”
the Stock Exchange of Hong Kong Limited, a wholly
owned subsidiary of Hong Kong Exchanges and Clearing
Limited
“Hong Kong Underwriters” the underwriters of the Hong Kong Public Offering listed in
“Underwriting – Hong Kong Underwriters” in this
prospectus
“Hong Kong Underwriting
Agreement”
the underwriting agreement dated on or around Thursday,
June 19, 2025 relating to the Hong Kong Public Offering and
entered into by, among others, our Company and the Hong
Kong Underwriters, as further described in “Underwriting –
Underwriting Arrangements and Expenses” in this
prospectus
“H Share(s)” overseas listed foreign Share(s) to be issued by the
Company with a nominal value of RMB1.00 each, which
is/are to be subscribed for and traded in HK dollars and is/
are to be listed on the Hong Kong Stock Exchange
“H Share Registrar” Tricor Investor Services Limited
“IASB” International Accounting Standards Board
“IFRS” International Financial Reporting Standards, which include
standards, amendments and interpretations promulgated by
the International Accounting Standards Board and the
International Accounting Standards and interpretation
issued by the International Accounting Standards
Committee
“Independent Third Party(ies)” any entity or person who is not a connected person of our
Company within the meaning ascribed thereto under the
Listing Rules
“International Offer Shares” the 1,404,880 H Shares initially offered by our Company
for subscription pursuant to the International Offering
together with, where relevant, any additional H Shares
which may be issued by our Company pursuant to the
exercise of the Over-allotment Option (subject to
21


--- page 31 ---
DEFINITIONS
reallocation as described in the section headed “Structure
of the Global Offering” in this prospectus)
“International Offering” the conditional placing of the International Offer Shares at
the Offer Price (plus brokerage of 1%, SFC transaction levy
of 0.0027%, AFRC transaction levy of 0.00015% and
Stock Exchange trading fee of 0.00565%) outside the
United States in offshore transactions in accordance with
Regulation S 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, led by the
Overall Coordinators, that are expected to enter into the
International Underwriting Agreement to underwrite the
International Offering
“International Underwriting
Agreement”
the underwriting agreement expected to be entered into on
or around the Price Determination Date by, among others,
our Company and the International Underwriters in respect
of the International Offering, as further described in
“Underwriting – Underwriting Arrangements and Expense
– International Offering” in this prospectus
“Joint Bookrunners” the joint bookrunners as named in the section headed
“Directors, Supervisors and Parties Involved in the Global
Offering” of this prospectus
“Joint Global Coordinators” the joint global coordinators as named in the section headed
“Directors, Supervisors and Parties Involved in the Global
Offering” of this prospectus
“Joint Lead Managers” the joint lead managers as named in the section headed
“Directors, Supervisors and Parties Involved in the Global
Offering” of this prospectus
“Joint Sponsors” China International Capital Corporation Hong Kong
Securities Limited and Haitong International Capital
Limited
“Latest Practicable Date” June 10, 2025, being the latest practicable date for the
purpose of ascertaining certain information contained in
this prospectus prior to its publication
“Listing” listing of the H Shares on the Main Board of the Hong
Kong Stock Exchange
“Listing Committee” the Listing Committee of the Hong Kong Stock Exchange
22


--- page 32 ---
DEFINITIONS
“Listing Date” the date, expected to be on or around Monday, June 30,
2025, on which our H Shares are listed and from which
dealings therein are permitted to take place on the Hong
Kong Stock Exchange
“Macau” the Macau Special Administrative Region of the PRC
“Main Board” the stock market (excluding the option market) operated by
the Stock Exchange which is independent from and
operated in parallel with the GEM of the Stock Exchange
“NDRC” the National Development and Reform Commission of the
PRC (
ึ)
“NHC” the National Health Commission of the PRC ( ʕശɛ͏΍ձ
ึ)
“Offer Price” the final price per Offer Share in Hong Kong dollars
(exclusive of brokerage of 1%, SFC transaction levy of
0.0027%, AFRC transaction levy of 0.00015% and Hong
Kong Stock Exchange trading fee of 0.00565%) of not
more than HK$205.00 and expected to be not less than
HK$165.00, 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, to be determined in the manner
further described in “Structure of the Global Offering –
Pricing and Allocation” in this prospectus
“Offer Share(s)” the Hong Kong Offer Shares and the International Offer
Shares, together with, where relevant, any additional H
Shares which may be issued by our Company pursuant to
the exercise of the Over-allotment Option
“Overall Coordinator(s)” China International Capital Corporation Hong Kong
Securities Limited, Haitong International Securities
Company Limited and ABCI Capital Limited
“Over-allotment Option” the option expected to be granted by our Company to the
International Underwriters, exercisable by the Overall
Coordinators pursuant to the International Underwriting
Agreement, pursuant to which our Company may be
required to allot and issue up to an aggregate of 234,140
additional H Shares at the Offer Price to, among other
things, cover over-allocations in the International Offering,
if any, further details of which are described in the section
headed “Structure of the Global Offering – The
International Offering – Over-allotment Option” in this
prospectus
23


--- page 33 ---
DEFINITIONS
“PBOC” the People’s Bank of China ( ʕ਷ɛ͏ვБ), the central
bank of the PRC
“PRC Legal Advisors” Han Kun Law Offices and Grandway Law Offices, the
PRC legal advisors of 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 the
section headed “History, Development and Corporate
Structure” in this prospectus
“Pre-IPO Investors” the investor(s) who participated in our Pre-IPO
Investments, details of which are set out in the section
headed “History, Development and Corporate Structure ” in
this Prospectus
“Price Determination Agreement” the agreement to be entered into by the Overall
Coordinators (for themselves and on behalf of the
Underwriters) and our Company on the Price
Determination Date to record and fix the Offer Price
“Price Determination Date” the date, expected to be on or around Thursday, June 26,
2025 (Hong Kong time) on which the Offer Price is
determined, or such later time as the Overall Coordinators
(for themselves and on behalf of the Underwriters) and our
Company may agree, but in any event no later than
12:00 noon on Thursday, June 26, 2025
“prospectus” this prospectus being issued in connection with the Hong
Kong Public Offering
“province” a province or, where the context requires, a provincial level
autonomous region or municipality, under the direct
supervision of the central government of the PRC
“Regulation S” Regulation S under the U.S. Securities Act
“RMB” or “Renminbi” Renminbi, the lawful currency of the PRC
“SAFE” State Administration of Foreign Exchange of the PRC (
ʕ
̮ි၍ଣ҅)
“SAT” the State Administration of Taxation of the PRC ( ʕശɛ͏
೼ਕᐼ҅)
“Securities and Futures Ordinance”
or “SFO”
the Securities and Futures Ordinance (Chapter 571 of the
Laws of Hong Kong), as amended, supplemented or
otherwise modified from time to time
24


--- page 34 ---
DEFINITIONS
“SFC” the Securities and Futures Commission of Hong Kong
“Shanghai Unisound” Unisound (Shanghai) AI Technology Co., Ltd. (ᑊ(ɪ
ऎ)ʮ̡), a company established in the PRC
with limited liability on August 7, 2017 and a wholly-
owned subsidiary of our Company
“Share(s)” ordinary shares in the share capital of our Company with a
nominal value of RMB1.00 each, comprising Domestic
Share(s) and H Share(s)
“Shareholder(s)” holder(s) of our Shares
“Shareholders Agreement” the amended and restated shareholders agreement entered
into by the Company and the Shareholders on May 21,
2023
“Shenzhen Unisound” Shenzhen Unisound Information Technology Co., Ltd. (
ଉ
ʮ̡), a company established in the
PRC with limited liability on December 28, 2015 and a
wholly-owned subsidiary of our Company
“Sponsor-Overall Coordinator(s)” China International Capital Corporation Hong Kong
Securities Limited and Haitong International Securities
Company Limited
“Stabilizing Manager” China International Capital Corporation Hong Kong
Securities Limited
“State Council” State Council of the People’s Republic of China (
ʕശɛ͏
΍ձ਷਷ਕ৫)
“subsidiary(ies)” has the meaning ascribed thereto in section 15 of the
Companies Ordinance
“Supervisor(s)” member(s) of Supervisory Committee
“Supervisory Committee” supervisory committee of the Company
“Tianjin Yunsheng” Tianjin Yunsheng Information Technology Co., Ltd. (
ݵ
ʮ̡), a company established in the
PRC on March 3, 2016 and one of our Controlling
Shareholders
“Track Record Period” the three financial years ended December 31, 2022, 2023
and 2024
“Underwriters” the Hong Kong Underwriters and the International
Underwriters
25


--- page 35 ---
DEFINITIONS
“Underwriting Agreements” the Hong Kong Underwriting Agreement and the
International Underwriting Agreement
“Unlisted Foreign Shares” ordinary share(s) in the share capital of our Company, with
a nominal value of RMB1.00 each, which were subscribed
for or credited as paid in U.S. dollars and held by foreign
Shareholders
“U.S.” or “United States” the United States of America, its territories, its possessions
and all areas subject to its jurisdiction
“U.S. Securities Act” the United States Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder
“US$” or “U.S. dollars” United States dollars, the lawful currency of the United
States
“Xiamen Unisound” Xiamen Unisound Intelligence Technology Co., Ltd. (
ژ
ʮ̡), a company established in the
PRC with limited liability on October 18, 2017 and a
wholly-owned subsidiary of our Company
“Yunchuang Hudong” Beijing Yunchuang Hudong Investment Management
Consulting Partnership (
̏ԯථ௴ʝਗҳ༟၍ଣፔ༔ΥྫΆ
ุ(Υྫ)), a limited partnership established in the PRC
on May 13, 2015, and one of our Employee Incentive
Platforms and Controlling Shareholders
“Yunsi Shangxin” Tianjin Yunsi Shangxin Enterprise Management
Consulting Partnership (Limited Partnership) (
֠ܠ
Άุ၍ଣፔ༔ΥྫΆุ(Υྫ)), a limited partnership
established in the PRC on January 19, 2017, and one of our
Employee Incentive Platforms
“Yunsi Shangyi” Yunsi Shangyi (Tianjin) Enterprise Management
Partnership (Limited Partnership) (
່(ݵ)Άุ၍ଣ
ΥྫΆุ(Υྫ)), a limited partnership established in
the PRC on March 28, 2016 and one of our Controlling
Shareholders
“Yunsi Shangzhi” Yunsi Shangzhi (Tianjin) Enterprise Management
Consulting Partnership (Limited Partnership) (
౽(˂
ݵ)Άุ၍ଣፔ༔ΥྫΆุ(Υྫ)), a limited partnership
established in the PRC on December 12, 2016 and one of
our Employee Incentive Platforms
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
26


--- page 36 ---
DEFINITIONS
Certain amounts and percentage figures included in this prospectus have been subject to
rounding. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation
of the figures preceding them. Any discrepancies in any table or chart between the total shown and the
sum of the amounts listed are due to rounding.
For ease of reference, the names of the PRC established companies or entities, laws or
regulations have been included in this prospectus in both the Chinese and English languages and in
the event of any inconsistency, the Chinese versions shall prevail.
27


--- page 37 ---
GLOSSARY OF TECHNICAL TERMS
The following is a glossary of certain terms used in this prospectus in connection with us
and/or our business. As such, these terms and their meanings may not correspond to standard
industry meanings or usage of these terms.
“5G” the 5th generation mobile network, a new global wireless
standard after 1G, 2G, 3G, and 4G networks
“AGI” artificial general intelligence, the representation of
generalized human cognitive abilities in artificial
intelligence so that, when faced with any unfamiliar task
that a human being is capable of, it could find a solution to
perform such task
“AI” artificial intelligence, an area of computer science that
focuses on simulating human intelligence by machines
“AI model” an algorithm that relies on training data to recognize
patterns and make predictions or decisions
“AI solutions” ready-to-use and automated analytics AI capabilities that
can generate accurate and meaningful insights to meet new
business trends and customer demands by deploying
hardware, software and cloud computing services
“algorithm” a procedure or formula for solving a problem, based on
conducting a sequence of specific actions, especially by a
computer
“API” application programming interface, a set of defined rules
that enable different applications to communicate with each
other
“audio-visual synthesis” or “AVS” a technology that allows synthetic creation of both audio
and visual material
“BERT” bidirectional encoder representations from transformers, a
transformer-based machine learning model for natural
language processing
“BI” business intelligence
“CAGR” compound annual growth rate
“CDSS” clinical decision support system
“Class III hospital” a multi-regional hospital with large capacity that provides
high-quality professional medical services and undertakes
higher education and scientific research initiatives, which is
designated as a Class III hospital by the NHC hospital
classification system
“cloud” a network of remote servers hosted on the Internet and used
to store, manage, process data, and offer algorithms in
place of local servers or personal computers
28


--- page 38 ---
GLOSSARY OF TECHNICAL TERMS
“computer vision” a field of AI that enables computers and systems to derive
meaningful information from digital images, videos and
other visual inputs and to take actions or make
recommendations based on that information
“conversational AI” a type of AI that can simulate human conversation. It is
made possible by natural language processing
“convolutional neural network” or
“CNN”
a class of artificial neural network that specifically
designed for image processing and recognition tasks
“Daily Life” our business sector covering a range of application
scenarios where AI solutions are integrated to improve the
convenience and quality of people’s everyday life,
including transportation, commercial space, hospitality and
residential scenarios, among others
“data science” refers to AI-driven decision-making that provides
predicative analysis and recommendations from large
datasets to support and guide actions, such as business
decisions
“deep learning” or “DL” a class of machine learning algorithms that constructs
artificial neural networks to mimic the structure and
function of the human brain, and progressively extract
higher-level features from the raw input
“deep neural network” or “DNN” a deep learning architecture inspired by information
processing and distributed communication nodes in
biological systems and is applied to enhance data capturing
and analysis capabilities
“fine-tuning” an approach to transfer learning in which the weights of a
pre-trained model are trained on new data
“generative adversarial networks” or
“GAN”
a machine learning model in which two neural networks
compete with each other to become more accurate in their
predictions
“GPT” generative pre-trained transformer, a type of large language
model and a prominent framework for generative artificial
intelligence
“GPU” graphic processing unit, a specialized electronic circuit
designed to rapidly manipulate and alter memory to
accelerate the creation of images
“industry-scale knowledge graphs” or
“IKG”
graphs that enable data analysis and decision-making of an
industry through linking concepts, entities, relationships
and events
29


--- page 39 ---
GLOSSARY OF TECHNICAL TERMS
“IoT” Internet of things, the extension of internet connectivity
into physical devices and everyday objects
“knowledge graph” a knowledge base that uses a graph structured data model
to store and organize information
“MWh” megawatt-hour, a unit of energy that equals to 1,000
kilowatts of electricity generated per hour and is used to
measure electric output
“large language model” or “LLM” a computerized language model consisting of an artificial
neural network with tens of millions of parameters, trained
on large quantities of unlabeled text using self-supervised
learning or semi-supervised learning
“LoRA” low-rank adaptation of large language models, a training
method that accelerates the training of large language
models while consuming less memory
“LEED Certified Building” a building that has been recognized under the Leadership in
Energy and Environmental Design (LEED) program, which
is a globally recognized green building certification system
developed by the U.S. Green Building Council
“MaaS” model as a service, a type of service which packages the
suitable AI engines toolbox for specific industry verticals
and cater to the needs of massive number of customers with
cost-efficient customization
“machine learning” or “ML” an application of AI that provides machines the ability to
automatically learn and improve from experience without
being explicitly programmed
“Major Customer(s)” customer(s) from whom we had revenue over RMB1
million in a prescribed period in Daily Life and Healthcare.
“MOS” mean opinion score, a commonly-used metric to measure
the overall voice call quality
“natural language processing” or
“NLP”
a process in which systems accumulate data as they work
and extract ever more accurate meaning from huge
volumes of raw, unstructured, and unlabeled text and voice
data sets through deep leaning models and learning
techniques
“NLU” natural language understanding, a subtopic of natural
language processing in artificial intelligence that deals with
machine reading comprehension
30


--- page 40 ---
GLOSSARY OF TECHNICAL TERMS
“NPU” neural processing unit, a microprocessor that specializes in
the acceleration of machine learning algorithms, typically
by operating on predictive models
“OCR” optical character recognition, the electronic or mechanical
conversion of images of text into machine-encoded text
“PACS” picture archiving and communication system, a medical
imaging technology which provides economical storage
and convenient access to images from multiple modalities
(source machine types)
“PB” petabyte, a multiple of the unit byte for digital information
with 1 petabyte equal to 10
15 bytes
“PCB” printed circuit board, a flat panel composite with
alternating layers of printed conductors and electrical
insulation, typically interconnected by conductive holes;
PCBs provide platforms to connect semiconductors and
other electronic, optical or mechanical devices to form a
circuit or functional system
“PFLOPS” peta floating point operations per second, a measure of
computing capabilities. One PFLOPS computer system is
capable of performing one quadrillion floating-point
operations per second
“potential contracts” represents signed contracts that have not yet recognized
revenue and contracts currently in the process of being
finalized
“Q&A” questions and answers
“R&D” research and development
“recurrent neural network” or “RNN” a type of artificial neural network which uses sequential
data or time series data
“reinforcement learning” or “RL” a machine learning training method based on rewarding
desired behaviors and/or punishing undesired ones
“reinforcement learning from human
feedback” or “RLHF”
a machine learning training method that combines
reinforcement learning techniques with human guidance
“SDK” software development kit, a set of software development
tools that allows the creation of applications for a certain
software package
“SSP frontend” digital front-end for speech signal processing
31


--- page 41 ---
GLOSSARY OF TECHNICAL TERMS
“text-to-speech” or “TTS” a technology that allows written text to be output as speech
“Transformer” or “transformer” a deep learning model, distinguished by its adoption of
self-attention, differentially weighting the significance of
each part of the input data
32


--- page 42 ---
FORWARD-LOOKING STATEMENTS
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 other things, the following:
Š general political and economic conditions, including those related to the PRC;
Š our ability to successfully implement our business plans and strategies;
Š future developments, trends and conditions in the industry and markets in which we
operate or into which we intend to expand;
Š our business operations and prospects;
Š our capital expenditure plans;
Š the actions and developments of our competitors;
Š our financial condition and performance;
Š capital market developments;
Š our dividend policy;
Š 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; and
Š various business opportunities that we may pursue.
Additional factors that could cause actual performance or achievements to differ materially
include, but are not limited to, those discussed in “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.
33


--- page 43 ---
RISK FACTORS
An investment in our H Shares involves significant risks. You should carefully consider all
of the information in this prospectus, including the risks and uncertainties described below,
before making an investment in our H Shares. The following is a description of what we consider
to be our material risks. Any of the following risks could materially and adversely affect our
business, financial condition and results of operations. The market price of our H Shares could
significantly decrease due to any of these risks, and you may lose all or part of your investment.
These factors are contingencies that may or may not occur, and we are not in a position
to express a view on the likelihood of any such contingency occurring. The information given is
as of the Latest Practicable Date, unless otherwise stated, will not be updated after the date
hereof, and is subject to the cautionary statements in “Forward-looking Statements” in this
prospectus.
RISKS RELATING TO OUR INDUSTRY AND BUSINESS
The industries in which we operate are characterized by constant changes. We may not be able
to continuously develop and innovate our technologies and provide products and solutions that
meet the expectations of customers.
The AI industries in which we operate are characterized by constant changes, including rapid
technological evolution, frequent introductions of new products and solutions, continual shifts in
customer demands and constant emergence of new industry standards, practices and regulatory
requirements. Thus, our success depends, in part, on our ability to respond to these changes in a cost-
effective and timely manner. We need to constantly anticipate the emergence of new technologies and
assess their market potential. We also need to invest significant resources in R&D to lead technological
advances to keep our solutions competitive. In 2022, 2023 and 2024, our R&D expenses amounted to
RMB287.1 million, RMB286.3 million and RMB370.1 million, accounting for 47.8%, 39.4% and
39.4% of our revenue in respective years. With the technological advancement, particularly the growth
of AI technologies and applications, we may incur substantial R&D expenses during the periods of
technological transformation to adapt to the evolving competitive landscape and technology
development, and lay a foundation for future growth, which is a common approach observed among
companies utilizing AI, according Frost & Sullivan. However, given the inherent uncertainties of R&D
activities, there can be no guarantee that we will continue to succeed in technological innovations and
effectively commercialize them. Consequently, any failure in our R&D activities or commercialization
endeavors may materially and adversely affect our business, financial condition, results of operations
and prospects.
We provide AI products and solutions supported by UniBrain. New technologies in AI and
AGI, machine learning, NLP, knowledge graph, computer vision and IoT technologies could render
our technologies or solutions obsolete or unattractive. If we are unable to keep up with the
technological developments to maintain the competitiveness of our solutions in an efficient manner, or
at all, our business, financial condition and results of operations would be materially and adversely
affected.
We are subject to credit risk related to delay in payment and defaults of customers.
We are exposed to credit risk related to delay in payment and defaults of our customers. There
is no guarantee that all our customers will settle payment in full as it falls due. If any of our customers
34


--- page 44 ---
RISK FACTORS
refuses to confirm the summary, becomes insolvent or delays its payment of our fees, our cash flow, as
well as our business, financial position and results of operations could be adversely affected. As of
December 31, 2022, 2023 and 2024, our trade receivables amounted to RMB368.9 million,
RMB411.1 million and RMB559.2 million, respectively, and we had allowance for impairment of
trade receivables of RMB137.6 million RMB212.1 million and RMB241.3 million, respectively. Our
trade receivables turnover days were 254 days, 283 days and 277 days in 2022, 2023 and 2024,
respectively. We may not be able to collect all such trade receivables due to a variety of factors that are
outside of our control, including long payment cycle of certain customers, adverse operating conditions
or financial situation of customers, and customers’ inability to pay caused by their end users’ delay in
payment. In particular, any financial difficulties experienced by our customers or end users may result
in a reduction in their engagement of our products and solutions and expose us to higher credit risks,
which could in turn materially and adversely affect our financial condition and results of operations.
In particular, we had extensive collaboration with Shimao Group Holdings Limited (“ Shimao
Group”) during the Track Record Period. We provide Shimao Group with our Daily Life solutions,
including residential and hospitality solutions. As of December 31, 2024, the total backlog contract
value of our ongoing projects amounted to RMB44.2 million. As of the same date, we had outstanding
trade receivables of RMB28.7 million with Shimao Group, of which we made provision of
RMB26.3 million. In January 2025, a winding-up petition was filed against Shimao Group, which was
subsequently ordered to be withdrawn by the Hong Kong High Court on February 25, 2025. Shimao
Group also announced a restructuring plan for its offshore debts, which has been sanctioned by the
High Court of Hong Kong on March 13, 2025. The effects of such procedures on us remain uncertain,
and additional liquidation or restructuring actions involving Shimao Group may arise in the future.
Given the above, there are uncertainties as to the financial conditions of Shimao Group and our
ongoing business engagements with Shimao Group, which may impair our ability to complete ongoing
projects, recognize anticipated revenue or recover trade receivables, which could in turn materially and
adversely affect our financial condition and results of operations. See “Business – Customers –
Collaboration with Shimao Group” and “Financial Information – Discussion of Certain Key Balance
Sheet Items – Current Assets and Liabilities – Trade Receivables.”
We may not be able to compete successfully against current or future competitors.
The AI industries in which we operate are highly competitive. We primarily compete with other
AI solution providers, as well as traditional digital solution providers and system integrators. We also
compete with existing players in each industry vertical we enter, who may not currently have AI
capabilities but may develop AI enhancements for current solutions or acquire AI capabilities from
other AI companies. We may also in the future face competition from new entrants who may possess
substantial financial resources, sophisticated technological capabilities and broad distribution channels
and may offer solutions that directly compete with ours. We may face potential competition from
global technology companies that seek to enter the China market, whether independently or through
the formation of strategic alliances with, or acquisition of, AI companies in China. Increased
competition could result in lower sales, price reductions, reduced margins and loss of market share.
To respond to heightened competition, we may be required to increase investments in
marketing, sales and most importantly R&D. We cannot assure you that such measures will be
effective and yield desired results. Our products and solutions may be replicated by our competitors,
requiring us to constantly update and improve the quality of our offerings to remain competitive. If we
35


--- page 45 ---
RISK FACTORS
fail to do so, it will be difficult for us to differentiate ourselves from competitors and we may lose
market share. If we are unable to compete successfully in a cost-efficient manner, or at all, our
business, financial condition and results of operations could be adversely affected.
We had net losses, net liabilities and net cash outflows in operating activities during the Track
Record Period, and may not be able to achieve or subsequently maintain profitability in the
future.
We recorded net losses of RMB375.4 million, RMB376.2 million, RMB454.2 million in 2022,
2023 and 2024, respectively. We may continue to record net losses as our business remains in an
expanding stage and we are continuously investing in R&D. We believe that our future revenue growth
will depend on, among other factors, our ability to develop new technologies, successfully commercialize
our AI technologies, enhance customer experience, compete effectively and expand our customer base. 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 losses in
the future and may not be able to achieve or subsequently maintain profitability.
We recorded net liabilities of RMB1,911.2 million, RMB2,298.8 million and
RMB2,752.9 million in 2022, 2023 and 2024 respectively, primarily due to our redemption liabilities
recognized as non-current liabilities, relating to certain redemption rights granted to our Pre-IPO
Investors that will cease to be effective when we submit the listing application to the Stock Exchange,
subject to certain conditions. See “History, Development and Corporate Structure — Pre-IPO
investments.”
In addition, we recorded net operating cash outflows of RMB165.6 million and RMB284.1
million and RMB319.0 million in 2022, 2023 and 2024, respectively. We may continue to have net
cash outflow from operating activities in the near future as we plan to continue to invest heavily in
R&D efforts. Our negative operating cash flows could adversely affect our operations by reducing the
amount of cash available to meet the cash needs for operating our business and funding our
investments in technological innovation and business expansion. If our future operating cash flows fail
to improve to a level to sufficiently cover our overall cash needs, we may plan to seek equity or debt
financing to fund our operations in the future. Such financing might not be available to us promptly or
on terms that are acceptable, or at all, and we may have limited financing channels due to our negative
cash flow. If we fail to obtain the required additional financing before we are able to reach levels of
revenue to meet our financial needs, our operation may be restricted or suspended. We may not be able
to execute our growth strategies, and our business, financial condition and prospects may be materially
and adversely affected if we cannot obtain sufficient capital to meet our needs.
Our recent growth is not necessarily indicative of our future performance, and we may not be
able to sustain our revenue growth rate in the future.
Our revenue increased by 21.1% from RMB600.6 million in 2022 to RMB727.3 million in
2023, and further increased by 29.1% to RMB939.0 million in 2024. However, you should not rely on
the revenue growth of any prior period as an indication of our future performance. We cannot assure
you that we will be able to manage our growth at the same rate as we did in the past or avoid any
decline in the future. To maintain our growth, we need to expand our product and solution offerings,
broaden our customer base and strengthen our technology capabilities, among others. To effectively
manage the expected growth of our operations and personnel, we will also be required to refine our
36


--- page 46 ---
RISK FACTORS
operational, financial and management controls and reporting systems and procedures. If we fail to
efficiently manage the expansion of our business, our costs and expenses may increase faster than we
planned and we may not successfully attract a sufficient number of customers in a cost-effective
manner, respond timely to competitive challenges, or otherwise execute our business strategies. Our
growth requires significant financial resources and will continue to place significant demands on our
management. There is no guarantee that we will be able to effectively manage any future growth in an
efficient, cost-effective and timely manner, or at all.
The AI industry is subject to evolving and extensive regulation in China. Future laws and
regulations may impose additional requirements and other obligations that could materially and
adversely affect our business, financial condition and results of operations.
The AI industry in China is evolving and we may experience strengthened regulatory
environment along with rapid industry evolution. Our business may be subject to extensive regulation
governing the industry. Government authorities in the PRC may continue to issue new laws, rules and
regulations governing the industry in which we operate in the PRC. For example, on July 10, 2023, the
CAC issued the Interim Measures for the Administrative Measures on Generative Artificial
Intelligence Services (
) (the “ Measures on Generative AI
Services”), which imposes compliance requirements for providers of generative AI services. The
Measures on Generative AI Services require generative AI service providers to take effective measures
to enhance the accuracy and reliability of the content created by the generative artificial intelligence.
Generative AI service providers shall (i) assume the responsibilities of content producers and perform
network information security obligations; (ii) assume the responsibilities of processors of personal
information to protect personal information; and (iii) process training data such as conducting pre-
training optimization in accordance with applicable laws and regulations. In addition, the providers of
generative AI services with public opinion attributes or the capacity for social mobilization shall apply
for security assessment and complete the filing formalities of algorithms in accordance with the
Provisions on the Administration of Algorithm Recommendation for Internet Information Services
(
). See “Regulatory Overview — Regulations and Policies on
Artificial Intelligence Technologies.” The interpretation and implementation of existing measures are
evolving and the PRC regulatory agencies, including the CAC, may further adopt new laws,
regulations, rules, or detailed implementation and interpretation related to the above-mentioned
measures, which may negatively affect us. As such, we cannot assure you that our compliance
measures are, and will be, always considered sufficient under applicable laws and regulations. If we
are unable to comply with the then applicable laws and regulations, such actual and alleged failure
could subject us to significant legal, financial and operational consequences.
In addition, the government authorities have imposed, and may continue to impose,
requirements relating to, among other things, new and additional licenses, permits and approvals on us,
which we may not be able to obtain, maintain or comply with. 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. New laws and regulations and
the interpretation to existing laws and regulations may be promulgated and come into effect from time
to time. We cannot assure you that we will not be found in violation of any future laws, regulations and
policies, or any of the laws, regulations and policies, currently in effect due to changes in the
interpretation of these laws, regulations and policies. If we fail to complete, obtain or maintain any of
the required licenses, certificates or approvals or make the necessary filings in any of the jurisdiction
37


--- page 47 ---
RISK FACTORS
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, imposition of fines, and discontinuation
or restriction of our operations. Any such penalties may disrupt our business operations and materially
and adversely affect our business, financial condition and results of operations.
We are subject to complex and evolving laws, regulations and governmental policies regarding
data security, privacy and personal information. Actual or alleged failure to comply with privacy
and data protection laws, regulations and governmental policies could damage our reputation,
deter current and potential customers from using our products and solutions and could subject
us to significant legal, financial and operational consequences.
In recent years, data security and privacy protection has become an increasing regulatory focus
of government authorities across the world. The PRC government has enacted a series of laws and
regulations on privacy protection and data security in the past few years. When conducting our
business, we may have access to certain data of our users and therefore are subject to the privacy and
data protection laws and regulations, including without limitation, the PRC Civil Code Law (
ʕശɛ
Պ), and the PRC Cybersecurity Law (). Moreover,
different regulatory bodies in PRC, including the MIIT, the CAC, the Ministry of Public Security, and
the SAMR have enforced data security and privacy protections laws and regulations with various
standards and applications. The various standards in enforcement of data privacy and protection laws
may increase our operating cost, as we need to spend time and resources to comply with various such
standards. Furthermore, the PRC regulatory and enforcement regime with regard to cybersecurity and
data protection is still evolving. PRC regulators have been increasingly focused on regulation in the
areas of cybersecurity and data protection. The following are examples of recent PRC regulatory
activities in this area.
On August 20, 2021, the State Council promulgated the PRC Personal Information Protection
Law (
), effective from November 1, 2021. The Personal
Information Protection Law requires, among others, that (i) the processing of personal information
should have a clear and reasonable purpose which should be directly related to the processing purpose,
in a method that has the least impact on personal rights and interests, and (ii) the collection of personal
information should be limited to the minimum scope necessary to achieve the processing purpose to
avoid the excessive collection of personal information. Entities handling personal information shall
bear responsibilities for their personal information handling activities, and adopt necessary measures to
safeguard the security of the personal information they handle. Otherwise, the entities handling
personal information could be ordered to rectify, or suspend or terminate the provision of services, and
face confiscation of illegal income, fines or other penalties.
On June 10, 2021, the SCNPC promulgated the PRC Data Security Law (
ʕശɛ͏΍ձ਷ᅰኽ
). The PRC Data Security Law, among others, provides for a security review procedure for the
data activities that may affect national security. On December 28, 2021, the CAC, together with other
relevant administrative departments, jointly promulgated the revised Cybersecurity Review Measures
(
) with effect from February 15, 2022, according to which critical information
infrastructure operators that procure internet products and services, and network platform operators
engaging in data processing activities, must be subject to the cybersecurity review if their activities
affect or may affect national security. The Cybersecurity Review Measures further stipulate that an
online platform operator who possesses personal information of over one million users and intends for
38


--- page 48 ---
RISK FACTORS
listing in a foreign country ( ਷̮ɪ̹) must be subject to the cybersecurity review. See “Regulatory
Overview – Regulations on Cyber Security and Data Protection.” Our legal advisor as to PRC data
security law is of the view that the term of “listing on a foreign stock exchange (
਷̮ɪ̹)” under the
Cybersecurity Review Measures exempts listing in Hong Kong from the mandatory obligation of ex-
ante declaration of cybersecurity review. In the meantime, the Cybersecurity Review Measures grant
the governmental authorities the discretion to initiate a cybersecurity review on any data processing
activity if they deem such activity affects or may affect national security. The exact scope of “critical
information infrastructure operators” under the current regulatory regime remains unclear and the
identification of critical information infrastructure operators is subject to specific identification rules
stipulated by relevant industry regulators and the notice from the relevant regulators pursuant to the
Regulations on Protection of Critical Information Infrastructure (
ᚐૢԷ).
As of the Latest Practicable Date, no detailed rules or guidance with respect to the
implementation of such regulations has been issued by any government authorities, and the Company
and its PRC Subsidiaries have not received any notification determining the Company or its PRC
Subsidiaries as “critical infrastructure information operator” from the relevant supervisory authorities.
However, the exact scope of “critical information infrastructure operators” under the current regulatory
regime remains unclear, and the PRC government authorities may have the discretion in the
interpretation and enforcement of these laws, and there can be no assurance that the relevant PRC
government authorities would not determine us as “critical infrastructure information operator” in the
future. In addition, it is possible that we may become subject to additional or new laws and regulations
in this regard, particularly to cybersecurity and protection laws in other jurisdiction if we extend our
business outside of the PRC in the future, which may result in additional expenses to us and subject us
to potential liability and negative publicity.
Furthermore, on September 30, 2024, the State Council published the Administration Regulations
on Network Data Security (
ၣഖᅰኽτΌ၍ଣૢԷ)( t h e“ Data Security Regulations ”), which
provides that network data processors conduct network data processing activities that affect or may
possibly affect national security must conduct national security review in accordance with relevant laws
and regulations. The Data Security Regulations provide no further explanation or interpretation as to how
to determine what constitutes “affecting national security.” As such, there remain uncertainties of
interpretation, application and enforcement of the evolving relevant laws and regulations, and future
regulatory changes may impose additional restrictions.
As of the Latest Practicable Date, we have collected the personal information of over one
million users, and such information is mainly collected from or generated by developers and end users
using our platforms or solutions, including the basic information of enterprise or individual developers
on our platforms, and the speech data produced by our end users. The likelihood that such information
is related to activities affecting national security is relatively low because (i) the data processed by us
has not been defined as core or crucial data as defined by the PRC Data Security Law and has not been
classified as any core or crucial data by any PRC government authorities; (ii) the information we
collect and generate within the territory of mainland China is stored within the territory of mainland
China, and our daily operations are not involved in cross-border transfer of identified core data, crucial
data or a large amount of personal information; (iii) as of the Latest Practicable Date, we have
implemented comprehensive policies and rules and taken necessary measures on cybersecurity and
data protection, which are in compliance with the mandatory requirements of the PRC government
authorities in all material respects; (iv) during the Track Record Period and up to Latest Practicable
39


--- page 49 ---
RISK FACTORS
Date, we have not received any investigation, notice, warning, or sanctions from any PRC government
authorities regarding national security, including but not limited to cybersecurity review initiated by
governmental authorities; and (v) we had not been involved in any service, product or data processing
activities that might give rise to national security risks based on the factors set out in the Cybersecurity
Review Measures. See “Regulations—Regulations on Cyber Security and Data Protection” for details.
However, our PRC Legal Advisors advised us that, given that (i) there is no detailed rules as to the
identification of core or crucial data and the identification of core or crucial data are subject to
interpretation by relevant PRC government authorities in practice; (ii) there is no clear explanation or
interpretations as to how to determine what constitutes “affecting national security” under the current
effective PRC laws and regulations; and (iii) the PRC regulatory authorities have the discretion in
interpreting the regulations, the PRC regulatory authorities may take a view that is contrary to the
above view. In addition, we cannot predict the impact of the draft regulations, if any, at this stage, and
we will pay close attention to and assess any development in the rule-making process. If the enacted
version of the draft regulations mandate clearance of cybersecurity review and other specific actions to
be completed by companies like us for the Global Offering or our future capital raising activities, or if
we are subject to such ex officio cybersecurity reviews initiated by the government authorities, we may
face uncertainties as to whether such clearance can be timely obtained, or at all. Failure to comply with
the cybersecurity and data privacy requirements in a timely manner, or at all, may prevent us from
using certain network products and services and subject us to government enforcement actions and
investigations, fines, penalties, suspension of our non-compliant operations, and revoking relevant
business permits or business licenses, among other sanctions. See “Regulatory Overview – Regulations
on Cyber Security and Data Protection.”
The laws and regulations regarding data security and privacy protection in China, as well as
other countries, are generally complex and evolving, with uncertainty as to the interpretation and
application thereof. As such, we cannot assure you that our privacy and data protection measures are,
and will be, always considered sufficient under applicable laws and regulations. Additionally, the
integrity of our privacy and data protection measures is also subject to system failure, interruption,
inadequacy, security breaches or cyber-attacks. If we are unable to comply with the then applicable
laws and regulations, or to address any data security and privacy protection concerns, such actual or
alleged failure could damage our reputation, deter current and potential customers from using our
solutions and could subject us to significant legal, financial and operational consequences.
We may not be able to retain existing customers, attract new or increase their spending.
Our abilities to retain existing customers, attract new customers, as well as increase the
spending by our customers depend on a number of factors, including our ability to offer more AI
solutions that address the needs of our customers at competitive prices, the quality of our customer
support, the compatibility of our products and solutions, and our data analytics capabilities. If we fail
to retain existing customers or attract new customers, we may not be able to grow our revenue as
quickly as we anticipate, or at all.
We may be unable to provide customers with products and solutions that meet the specific
demand of such customers. From time to time, we may find defects in our products and solutions, and
new errors in our existing products and solutions may be detected. Since our customers use our service
for important aspects of their business, any errors, defects, disruptions in service or other performance
problems with our offerings could hurt our reputation and may damage our customers’ businesses.
40


--- page 50 ---
RISK FACTORS
Customer support is critical to maintaining customer satisfaction, but we may not be able to
continuously deliver high quality customer support. For example, we may not be able to recruit or
retain sufficient qualified support personnel with experiences in supporting customers and end users of
our products and solutions, which could result in customer dissatisfaction, decreased overall demand
for our solutions and loss of expected revenue. We also may be unable to modify the future scope and
delivery of our maintenance services and technical support to compete with changes in the technical
services provided by our competitors. In addition, our failure to meet customer service expectations
may damage our reputation and could consequently limit our ability to retain existing customers and
attract new customers, which would materially and adversely affect our business and results of
operations.
Furthermore, the quality of data and user feedback are key to the improvement of our large
language model and products and solutions. The quality and availability of such information cannot be
assured. Our data labels may be out of date, inaccurate or lacking credible information, which could
materially affect the accuracy and validity of our data analytical capability, products and solutions, and
in turn adversely affect our reputation, business operations and financial performance.
The competitiveness of our products and solutions depends in part on their ability to operate with
products and services of third parties. As we make our products and solutions available across a variety of
IT systems and devices, we depend on the compatibility of our offerings with mainstream devices and IT
systems that we do not control. Any changes to technologies used in our products and solutions to existing
features that we rely on, or to IT systems which make it difficult for our customers or end users to access
our products or solutions, may make it more difficult for us to maintain or increase our revenues.
In addition, we may fail to predict the future level of demand for our products and solutions as
the demand of our customers may be affected by a combination of factors beyond our control, such as
market or economic conditions, government policies and regulatory environment, making it difficult to
predict our future financial performance or increase the spending of our customers. If we fail to
respond to constant changes in market and political conditions, or if the major industries we operate in
do not develop as we expect, we may lose significant business opportunities, and our business and
results of operations may be materially and adversely affected.
We are subject to risk related to the prolonged cash conversion cycle.
During the Track Record Period, we experienced increased inventory turnover days, which are
46 days, 49 days and 71 days in 2022, 2023 and 2024, respectively. Such increases were primarily due
to an increase in contract fulfillment cost arising from the ongoing solution projects that are yet to be
delivered to and accepted by the customers by the year end. See “Business – Logistics and Inventory
Management – Inventory Management.” In addition, our trade receivables turnover days remained
relatively high at 254 days in 2022, 283 days in 2023 and 277 days in 2024, primarily because (i)
during the Track Record Period, we had been continuously expanding our business in the public
sectors such as transportation and healthcare, the customers of which, mainly including government
departments, public institutions and state-owned enterprises, typically have a longer payment cycle in
accordance with their internal financial management and payment approval processes; and (ii) certain
of our private sector customers were in the process of improving their overall liquidity condition
during a slow post-pandemic recovery in 2022 and 2023. See “Financial Information – Discussion of
Certain Key Balance Sheet Items — Current Assets and Liabilities – Trade Receivables.” Although we
have been diversifying our customer profile and aim to continuously improve the collection of trade
41


--- page 51 ---
RISK FACTORS
receivables and the turnover days by strengthening communication with customers, actively collecting
and negotiating feasible repayment plans based on actual conditions, these efforts may not be
successful and if our inventory turnover days and our trade receivables turnover days continue to
increase or remain relatively high, it may lead to a longer cash conversion cycle, which could further
add pressure to our cash flow and working capital. Our financial position, business and results of
operations might be adversely and materially impacted.
We may fail to manage our inventory effectively.
Our inventory primarily includes purchased hardware and software, including AI chips, AI
modules and AI devices, as well as contract fulfillment costs. As of December 31, 2022, 2023 and 2024,
the balance of our inventories was RMB33.6 million, RMB67.9 million and RMB140.3 million,
respectively. See “Financial Information – Discussion of certain key balance sheet items – Current assets
and liabilities – Inventories.” Maintaining an optimal level of inventory is important for the success of
our business. We determine our level of inventory based on our experience, number of orders from
customers and assessment of customer demand.
Inventories levels in excess of customer demand may result in inventory write-downs,
expiration of products or an increase in inventory holding costs and a potential negative effect on our
liquidity. On the other hand, failure to maintain a sufficient inventory level may result in slow
movement of our inventories and inability to timely utilize or sell our inventories. As we plan to
continue expanding our product and solution offerings, we expect to include more materials in our
inventories, which will make it more challenging for us to manage our inventories effectively. If we
fail to manage our inventories effectively, we may be subject to a heightened risk of inventories
obsolescence and any such situation may have a material and adverse effect on our business, financial
condition and results of operations.
Our business depends substantially on the continuing efforts of our management and other key
personnel, as well as a competent pool of talents that support our operations and future growth,
and we may not be able to retain, attract, recruit and train such personnel.
Our success depends on our ability to retain existing management and other key personnel
including renowned scientists and attract, recruit and train a large number of qualified employees. In
particular, we rely on our R&D team to develop advanced algorithms and technologies and
experienced sales personnel to attract customers and increase their level of engagement with us. To
compete for talent, we may need to offer higher compensation, better training and more attractive
career opportunities and other benefits to our employees, which may be costly. We cannot assure you
that we will be able to attract or retain a qualified workforce necessary to support our future growth.
Furthermore, any disputes between us and our employees or any labor-related regulatory or legal
proceedings may divert management and financial resources, negatively impact staff morale, reduce
our productivity, or harm our reputation and future recruiting efforts. In addition, our ability to train
and integrate new employees into our operations may not meet the demands of our growing business.
Any of the above issues related to our workforce may materially and adversely affect our operations
and future growth.
42


--- page 52 ---
RISK FACTORS
Our strategic partnerships with academic institutions for joint R&D projects and other
initiatives may not continue.
We entered into strategic partnerships with academic institutions for joint R&D projects and
other initiatives. See “Business – Research and Development – R&D Collaboration.” There can be no
assurance that these institutions will continue to collaborate with us on commercially reasonable terms
or at all. We also cannot assure you that we will be able to establish new joint research projects, or
extend existing relationships with the academic institutions when our agreements with them expire.
Furthermore, certain of our agreements with the institutions may be terminated prior to their specified
termination dates, the institutions may alter the contract terms previously agreed between us, and they
are under no obligation to continue our collaboration. If we are unable to maintain our relationships
with the institutions, or any of our collaboration with the institutions are terminated, our business,
results of operations and prospects could be materially and adversely affected.
Our technology infrastructure may experience unexpected system failure, interruption,
inadequacy, security breaches or cyber-attacks.
Our technology infrastructure may encounter disruptions or other outages caused by problems
or defects in our own technologies and systems, such as malfunctions in software or network overload,
and by damages from fires, floods, earthquakes and other natural disasters, telecommunication failures,
power loss, human error or other accidents. Our infrastructure and systems may be breached if any
vulnerabilities therein are exploited by unauthorized third parties.
Any such disruption or inadequacy that causes interruptions to our operations or failure to
maintain the network and server, could affect the ability of customers to use our products and solutions
and reduce our customer satisfaction. An actual or perceived attack or security breach may damage our
reputation and brand, expose us to risks of potential litigation and liabilities, and require us to expend
significant capital and other resources to alleviate problems caused by such attacks or security
breaches. During the Track Record Period, we did not experience any material network or service
interruption, system failure, data loss, inadequacy, security breaches or cyber-attacks. We cannot
assure you that any applicable recovery system, security protocol, network protection mechanisms or
other defense procedures are, or will be, adequate to prevent such network or service interruptions,
system failures, data losses, inadequacy, security breaches or cyber-attacks. Despite any precautionary
measures we may take, the occurrence of unanticipated problems that affect our technology
infrastructure could result in interruptions in the availability of our products and solutions. It may be
difficult for us to respond to such interruptions in a timely manner, or at all. As a result, our reputation,
business and financial condition could be adversely affected.
Our business is dependent on our brand recognition.
Our business and financial performance depends on the strength and the market acceptance of
our brands. Our products and solutions may malfunction, become obsolete or otherwise fail to meet
customers’ expectation. Any loss of trust in our products and solutions could harm the value of our
brands, which could materially reduce our revenue and gross margin. For example, if customers are
unsatisfied with our products or solutions, our reputation could be materially affected, and our
business, financial condition and results of operations could be materially and adversely affected.
From time to time, we participate in offline events, such as industry conferences and product
launches, and work with media or search engine companies to associate our brands and reputation with
43


--- page 53 ---
RISK FACTORS
technology or to promote our new products and solutions, which may cause us to substantially increase
our marketing expenditures. However, we cannot assure you that these activities will be successful or
that we will be able to achieve the promotional effect we expect.
We depend on third party business partners in our business operations. Such arrangements may
reduce our control over supply sufficiency, product quantity and quality, development,
enhancement and product delivery schedule.
We engage suppliers to supply certain hardware of our AI products and solutions. We have also
outsourced much of our transportation and logistics management, software development support and
certain non-essential R&D tasks to third-party contractors. While these arrangements may lower our
operating costs, they may also reduce our direct control over development and delivery. We may
experience operational difficulties with our suppliers, and contractors, including supply shortage,
reductions in the availability of resources and capacity, failures to comply with our standard,
insufficient quality control, longer lead time required and delays in the development process. For
example, any supply shortages for semiconductors broadly in the market may have an impact on the
supply of semiconductors for our products.
Our suppliers, and contractors may experience disruptions in their operations due to equipment
breakdowns, labor strikes or shortages, natural disasters, component or material shortages, cost
increases, environmental non-compliance issues or other similar problems. In addition, we may not be
able to renew contracts with our suppliers, or contractors or identify suitable substitute partners.
Although arrangements with these partners may contain provisions for warranty expense
reimbursement, we may remain responsible for the customer for warranty service in the event of
product defects and could experience an unanticipated product defect or warranty liability. Any failure
of our suppliers and contractors to perform their responsibilities or to be in compliance with all
applicable laws and regulations may have a material negative impact on our operations or compliance.
Our use of open source technology could impose limitations on our business operations.
We use open source software in some of our products and solutions and expect to continue to
use open source software in the future. Although we monitor our use of open source software to avoid
subjecting our software to conditions we do not intend, we may face allegations from others alleging
ownership of, or seeking to enforce the terms of, an open source license, including by demanding
release of the open source software, derivative works, or our proprietary source code that was
developed using such software. These allegations could also result in litigation. The terms of many
open source licenses have not been interpreted by courts. There is a risk that these licenses could be
construed in a way that could impose unanticipated conditions or restrictions on our ability to
commercialize our software and platform. In such an event, we may be required to seek licenses from
third parties to continue commercially offering our software, to make our proprietary code generally
available in source code form, to re-engineer our software or to discontinue the sale of our software if
re-engineering could not be accomplished on a timely basis, any of which could adversely affect our
business and revenue.
44


--- page 54 ---
RISK FACTORS
AI technologies are in nascent stage of development. We may experience misuse of AI
technologies, whether actual or perceived, intended or inadvertent, committed by us or by other
third parties.
AI technologies are in the process of rapid development and continue to evolve. Similar to
many disruptive innovations, AI technologies present risks and challenges, such as misuse by third
parties for inappropriate purposes, for purposes breaching public confidence or even violating
applicable laws and regulations in China. Application of AI technologies in illegal, biased, unfair or
otherwise inappropriate manners could affect customer perception, public opinions and their adoption.
We have adopted a series of internal control measures to prevent the misuse of our technologies and
data. See “Business – Risk Management and Internal Control.” However, we cannot assure you that
the measures we take to prevent the misuse of our technologies will always be effective, or that our
technologies will not be misused or applied in a way that is inconsistent with our intention or public
expectation. Any inappropriate, abusive or premature usage of AI technologies, whether actual or
perceived, whether intended or inadvertent and whether by us or by third parties, may dissuade
prospective customers from adopting AI solutions, may impair the general acceptance of AI solutions
by the society, may attract negative publicity and adversely impact our reputation and may even violate
applicable laws and regulations in China and subject us to legal or administrative proceedings and/or
other organizations and heightened scrutiny by the regulators. Each of the foregoing events may in turn
materially and adversely affect our business, financial condition and results of operations.
We had concentration of customers during the Track Record Period.
During the Track Record Period, we relied on a limited number of customers. In 2022, 2023
and 2024, revenue generated from our five largest customers in each year during the Track Record
Period represented 30.8%, 27.4% and 26.7% of our total revenue, respectively, while the percentage of
our revenue attributable to our largest customer in each year during the Track Record Period amounted
to 13.1%, 9.3% and 7.0% of our total revenue for the same years, respectively. See “Business—
Customers.” We cannot guarantee that we will be able to continue to maintain our relationships with
our major customers, or that we will be able to derive any business from them in the future. If our
major customers scale back or terminate their business relationship with us, or if we are unable to
negotiate favorable contractual terms with them, or we are unable to secure new customers at all or on
favorable or comparable terms, our business, financial condition and results of operations may be
materially and adversely affected.
We may default on bank borrowing and guarantee agreements.
We are subject to restrictive covenants under some of our bank borrowing and guarantee
agreements. Such restrictive covenants include, among others, limitations on our ability to license
intellectual property rights and repayment in advance. These covenants limit the manner in which we
conduct our business and we may be unable to engage in certain business activities or finance future
operations or capital needs. During the Track Record Period, we did not experience any material
default on bank borrowing and guarantee agreements. If we fail to meet restrictive covenants under our
bank borrowing and guarantee agreements, lenders may declare all borrowings outstanding and
accrued and unpaid interest to be immediately due and payable, and we may be also required to pay
accrued and unpaid interest at higher interest rates. If lenders accelerate the repayment of our
borrowings, we may not have sufficient cash to timely repay the borrowings and repayments may
disrupt our cash flow and liquidity plans. As a result, our business, financial condition and results of
operations may be materially and adversely affected.
45


--- page 55 ---
RISK FACTORS
We may experience discontinuation, reduction or delay of any preferential tax treatments or
government grants.
A number of our PRC subsidiaries enjoy various types of preferential tax treatment according
to the prevailing PRC tax laws. Our PRC subsidiaries recognized as high and new technology
enterprises are subject to a reduced EIT rate of 15%. Such preferential tax treatments are subject to
change and termination. If our preferential tax treatments are revoked, become unavailable or if the
calculation of our tax liability is successfully challenged by the PRC tax authorities, the
discontinuation of any of the various types of preferential tax treatment we enjoy could materially and
adversely affect our results of operations. See “Financial Information—Description of Major
Components of our Results of Operations – Income Tax Credit/(Expense)—PRC.”
We also receive grants from local governments, which are discretionary and vary from year to
year. In 2022, 2023 and 2024, we recorded government grants as other income amounting to RMB13.2
million, RMB32.7 million and RMB16.1 million, respectively. Local governments may decide to
adjust such grants in the future. We cannot assure you of the continued availability of the government
grants currently enjoyed by some of our PRC subsidiaries. Any reduction, cancelation, or repayment of
government grants could adversely affect our business, financial condition and results of operations.
We face risk associated with our investment, including the exposure of fair value changes for our
financial assets at fair value through profit or loss and valuation uncertainty.
During the Track Record Period, we had invested in wealth management products and unlisted
equity investments and may, from time to time, invest in such products in the future. As of
December 31, 2022, 2023 and 2024, our financial assets at fair value through profit or loss amounted to
RMB21.7 million, RMB99.6 million and RMB24.3 million, representing 3.8%, 9.0% and 2.3%, of our
total assets. We are exposed to credit risk in relation to such investments, which may adversely affect
the net changes in their fair value. Our investments may earn yields substantially lower than
anticipated, and the fair values of our investments may fluctuate significantly, which contribute to the
uncertainties in valuation. The financial assets at fair value through profit or loss are stated at fair
value, and net changes in their fair value are recorded under net other gains/(losses), and therefore
directly affect our results of operations. If we record fair value losses, our financial condition, results of
operations and prospects may be adversely affected. See Note 25 to the Accountant’s Report in
Appendix I to this prospectus.
We use significant unobservable inputs, such as the expected yield of the underlying
investment portfolio and discount rate, in valuing such financial assets. Accordingly, such
determination requires us to make significant estimates, which may be subject to material changes.
Factors beyond our control can significantly influence and cause adverse changes to the estimates and
thereby affect the fair value. These factors include, but are not limited to, general economic conditions,
changes in market interest rates and stability of the capital markets. The valuation may involve a
significant degree of judgment and assumptions which are inherently uncertain, and may result in
material adjustment, which in turn may materially and adversely affect our results of operations.
We have share incentive plans and may grant share-based awards in the future, which may
result in increased share-based compensation expenses.
We adopted share incentive plans for the purpose of granting share-based compensation awards
to our officers, directors, employees and other eligible persons to incentivize their performance and
46


--- page 56 ---
RISK FACTORS
align their interests with ours. We have adopted the 2016 Employee Incentive Scheme and the 2023
Employee Incentive Scheme, and recorded share-based payment expenses of RMB4.5 million and nil in
the year ended December 31, 2023 and 2024, see “Statutory and General Information — D. Employee
Incentive Schemes” in Appendix VI to this prospectus. We believe the granting of share-based
compensation awards is of significant importance to our ability to attract and retain key personnel and
employees, and we may continue to grant share-based compensation awards in the future. As a result, our
expenses associated with share-based compensation may increase, which may have a material and
adverse effect on our financial condition and results of operations, and issuance of additional shares for
future share-based compensation awards may dilute our shareholding. Furthermore, there are no
assurances that the number of shares reserved for issuance under our share incentive plans will be
sufficient to grant equity awards adequate to recruit new employees and to compensate existing
employees. In case we decide to reserve and issue additional shares under our share incentive plans, your
interests in our Company will be further diluted by such issuance.
The changes in the carrying amount of redemption liabilities may adversely affect our financial
condition and results of operations.
Our financial instruments issued to investors were primarily related to redemption rights
granted to certain investors of our Series Angel, Series A, Series B, Series C, Series C+, Series D,
Series D+, Series D1, Series D2 and Series D3 financing. The redemption rights of the investors
constitute our redemption liability to repurchase our own equity instruments. The redemption liability
is initially measured at the present value of the redemption amount and subsequently measured at
amortized cost with interest charged in finance costs. We had redemption liabilities of RMB2,109.0
million, RMB3,038.5 million and RMB3,303.1 million as of December 31, 2022, 2023 and 2024,
respectively. Any significant fluctuations in the changes in the carrying amount of financial
instruments issued to investors due to changes in the amortized cost may materially affect our financial
condition and results of operations.
Our performance is subject to seasonality.
We experience seasonality in our business. Typically, our products and solutions generate
higher revenue in the second half of the financial year due to our customers’ preference to conclude
projects in accordance with their financial budgets’ approval procedures and usual business plan. See
“Financial Information — Major Factors Affecting Our Results of Operations and Financial Condition
— Company Specific Factors — Seasonality.” Any comparisons of our operating results between
different periods within a single financial year are not necessarily meaningful and cannot be relied on
as indicators of our performance. Our financial condition and results of operations for future periods
may continue to fluctuate, from time to time, due to seasonality.
We may experience any future occurrence of force majeure events, natural disasters or
outbreaks of contagious diseases.
Any future occurrence of force majeure events, natural disasters or outbreaks of epidemics and
contagious diseases, including COVID-19 pandemic, avian influenza, severe acute respiratory
syndrome, H1N1 influenza or Ebola virus, may materially and adversely affect our business, financial
condition and results of operations. During the Track Record Period, the COVID-19 pandemic, its
recurrence and related travel restrictions temporarily prevented us from engaging with customers
through in-person meetings and providing them with deployment and technical support services. An
47


--- page 57 ---
RISK FACTORS
outbreak of an epidemic or contagious disease could result in a widespread health crisis and restrict the
level of business activities in affected areas, which may, in turn, materially and adversely affect our
business. Moreover, the PRC has experienced natural disasters such as earthquakes, floods and
droughts in the past few years. Any future occurrence of severe natural disasters in the PRC may
materially and adversely affect its economy and therefore our business.
We are also vulnerable to natural disasters and other calamities because our properties and
information systems are susceptible to damage or disruption from fire, floods, typhoons, earthquakes,
power loss, telecommunications failures, break-ins, war, riots, terrorist attacks, or similar events. Any
of the foregoing events may give rise to interruptions, damage to our property, breakdowns, system
failures, technology platform failures, or internet failures, which could result in disruptions to our
business operations and adversely affect our business, financial condition and results of operations.
We may from time to time be subject to claims, disputes, lawsuits and other legal and
administrative proceedings.
We are susceptible to claims and various legal and administrative proceedings. Claims arising
out of actual or alleged violations of law, breach of contract or torts could be asserted against us by
customers, business partners, suppliers, competitors, employees or governmental entities in
investigations and legal proceeding. In particular, we may be subject to product liability claims if our
products contain significant defects. Products and solutions within the industry, such as those we
develop, may contain errors, defects, security vulnerabilities or software issues that are difficult to
detect and correct, particularly when first introduced or when new versions or enhancements are
released. 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.
Regardless of the merit of the particular claim, legal and administrative proceedings may be
expensive, time-consuming or disruptive to our operations and distracting to management If a
judgment, a fine or a settlement involving a payment of a material sum of money were to occur, or
injunctive relief were issued against us, it may result in significant monetary liabilities and may
materially disrupt our business and operations, and our business, financial position, results of
operations, prospects and reputation could be materially and adversely affected. In recognition of these
considerations, we may enter into agreements to settle litigation and resolve such disputes. There is no
assurance that such agreements can be obtained on acceptable terms or that litigation will not occur.
These agreements may also significantly increase our operating expenses. During the Track Record
Period and up to the Latest Practicable Date, there was no legal or administrative proceeding pending
or threatened against us that could, individually or in the aggregate, have a material effect on our
business, financial condition or results of operations. However, new legal or administrative
proceedings and claims may arise in the future, which may cause us to incur defense costs, and our
business and financial conditions could be materially and adversely affected.
48


--- page 58 ---
RISK FACTORS
We may not be able to obtain, maintain and protect our intellectual properties and prevent
unauthorized use of our intellectual properties by third parties.
We regard our trademarks, copyrights, patents, know-how, trade secrets and other intellectual
properties as critical to our success and rely on a combination of patent, trademark and copyright laws,
trade secrets protection, restrictions on disclosure and other agreements that restrict the use of our
intellectual properties to protect these rights. Although our contracts with our business partners prohibit
the unauthorized use of our brands, images, characters, and other intellectual property rights, we cannot
assure you that they will always comply with these terms. These agreements may not effectively
prevent disclosure of confidential information and may not provide an adequate remedy in the event of
unauthorized disclosure of confidential information. In addition, third parties may independently
discover trade secrets and proprietary information, limiting our ability to assert any trade secret rights
against such parties.
In addition, our competitors and other third parties may register trademarks or purchase Internet
search engine keywords or domain names that are similar to ours to cause confusion to our customers
and drive potential customers from our business to theirs. Preventing such unfair competitive activity is
inherently difficult. If we are unable to prevent such unauthorized use, our business, financial condition
and results of operations could be adversely affected.
The application and enforcement of PRC intellectual property laws, regulations and rules are
continuously evolving. Furthermore, policing unauthorized use of proprietary technology is difficult
and expensive. Monitoring unauthorized use of our intellectual property and unfair competitive activity
is difficult and costly, and we cannot assure you we will detect all such actions in a timely manner and
that the steps we have taken or will take will prevent misappropriation of our intellectual property.
From time to time, we may have to resort to litigation to enforce our intellectual property rights, which
could result in substantial costs and diversion of our resources.
We may need to defend ourselves against claims for intellectual property infringement, which
may be time-consuming and would cause us to incur substantial costs.
Our operations or any aspects of our business may infringe upon or otherwise violate
trademarks, copyrights, patents, know-how, trade secrets or other intellectual property rights held by
third parties. Holders of patents or other intellectual property rights purportedly relating to some aspect
of our technology infrastructure or business, if any such holders exist, may seek to enforce patents or
other intellectual property rights against us in PRC or any other jurisdictions. Furthermore, the
application and interpretation of PRC laws relating to patents and other intellectual property rights and
the procedures and standards for granting such patents or other intellectual property rights in PRC are
still evolving, and we cannot assure you that the relevant courts or regulatory authorities would agree
with our analysis. As we face increasing competition from other competitors in China, there may be a
higher risk for us to be subject to intellectual property infringement claims or other legal proceedings.
We may incur additional costs in monitoring and detecting potential infringement. If we are found to
have violated the intellectual property rights of others, we may be subject to liability for our
infringement activities or may be prohibited from using such intellectual property, and we may incur
licensing fees or be forced to develop alternatives of our own.
49


--- page 59 ---
RISK FACTORS
Misconduct, non-compliance and omissions by our employees or third parties could harm our
business and reputation.
Misconduct, non-compliance and omissions by our employees or third parties could subject us
to liability or negative publicity. During the Track Record Period, we did not experience any
misconduct, non-compliance or omissions by our employees or third parties that materially affected
our business operations or financial performance. However, there can be no assurance that our
employees or third parties will not engage in misconducts, non-compliance or omissions that could
materially and adversely affect our business, financial condition and results of operations.
Misconduct, non-compliance and omissions by our business partners, including our various
suppliers, service providers and customers, as well as other third parties who have entered business
relationships with our business partners, could subject us to liability or negative publicity. Although we
have strict standards to choose our service providers, they may be subject to regulatory penalties or
punishments because of their regulatory compliance failures, which may, directly or indirectly, affect
our business. We cannot be certain whether such third party has infringed or will infringe any other
parties’ legal rights or violate any regulatory requirements. We cannot rule out the possibility of
incurring liabilities or suffering losses due to any non-compliance by third parties. We cannot assure
you that we will be able to identify irregularities or non-compliances in the business practices of our
business partners or other third parties, or that such irregularities or non-compliance will be corrected
in a prompt and proper manner. The legal liabilities and regulatory actions on our business partners or
other third parties involved in our business may affect our business activities and reputation, which
may in turn affect our results of operations.
We might be subject to the risks associated with international trade policies, geopolitics and
trade protection measures, and our business, results of operations, financial conditions and
prospects could be adversely affected.
Our operations may be negatively affected by any deterioration in the political and economic
relations among countries and sanctions and export controls administered by the government
authorities in the countries in which we operate, and other geopolitical challenges, including, but not
limited to, economic and labor conditions, increased duties, taxes and other costs and political
instability. For example, the U.S. government imposed economic and trade sanctions directly or
indirectly affecting 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 or other factors that are out of
our control. Such potential restrictions, as well as any associated inquiries or investigations or any
other government actions, may be difficult or costly to comply with and may, among other things,
delay or impede the development of our technology, products and solutions, hinder the stability of our
supply chain, and may result in negative publicity, require significant management time and attention
and subject us to fines, penalties or orders that we cease or modify our existing business practices, any
of which may have a material and adverse effect on our business, financial condition and results of
operations.
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 (“BIS”), which includes a list of foreign persons on
which certain trade restrictions are imposed (the “Entity List”). The export, re-export and/or transfer
50


--- page 60 ---
RISK FACTORS
(in-country) of items subject to the EAR to a listed foreign person is generally prohibited unless the
specified license requirements are met. These restrictions or regulations, and similar or more expansive
restrictions or regulations that may be imposed by the U.S. or other jurisdictions in the future, may
materially and adversely affect our ability to acquire technologies, systems, devices or components that
may be critical to our technology infrastructure, product offerings and business operations. Any
uncertainties and changes in these current or future restrictions or regulations may have a negative
impact on our reputation and business. If certain of our customers and suppliers are listed on the Entity
List and subject to restrictions from sourcing or selling technologies, software, or components from or
to us, we may not be able to obtain, extend or maintain the requisite regulatory permits in relation to
our transactions with these customers and suppliers.
In addition, On October 28, 2024, the Department of the Treasury issued the Provisions
Pertaining to U.S. Investments in Certain National Security Technologies and Products in Countries of
Concern (the “Final Rule”), which became effective on January 2, 2025. The Final Rule implements a
regulatory framework for certain U.S. investments into China (including Hong Kong and Macau) in
entities engaged in activities involving sensitive technologies critical to national securities in three
sectors, namely, semiconductors and microelectronics, quantum information technologies, and certain
artificial intelligence systems with applications that pose national security risks. The program would
prohibit U.S. persons from undertaking certain transactions and require notification by U.S. persons on
certain investments. As our AI products and solutions are primarily used in Daily Life and Healthcare
scenarios to help enterprises improve their operational efficiency and service quality and reduce the
management costs, we do not foresee that our products and solutions would fall into the Prohibited End
Uses or the Notifiable End Uses. Nevertheless, we cannot guarantee that the rule will not negatively
affect overall investor sentiment and potentially discourage investment in our Company.
In addition, significant political, trade, or regulatory developments, such as those stemming
from the current U.S. federal administration and changes in U.S. federal policy implemented by the
U.S. Congress, the Trump administration or any new administration could give rise to circumstances
outside our control that could have negative impacts on our business operations, including as a result of
an economic downturn and geopolitical events.
For example, President Trump has increased, and has indicated his willingness to continue to
increase, the use of tariffs by the U.S. to accomplish certain U.S. policy goals. During the course of
February and April 2025, President Trump implemented tariffs on several major trading partners,
including Canada, China, the European Union and Mexico, with a baseline of 10% tariffs on all
countries and an additional individualized reciprocal higher tariff on the countries with which the
United States has the largest trade deficits. On April 9, 2025, President Trump announced that the
“reciprocal tariff” policy would be paused for 90 days on trading partners who did not retaliate after
such policy took effect, but the 10% baseline tariff would apply to nearly all other U.S. trading
partners. Tariffs on Chinese imports, however, has increased significantly as the two countries have
implemented retaliatory tariffs and placed additional limitations on export controls. There is significant
uncertainty on how the U.S. will respond, and any rising political tensions, as well as increases in
tariffs or changes to trade policies between the U.S. and China.
As we currently do not and have no plans to sell to the U.S. or procure products from the U.S.,
we do not foresee these policies to have a direct adverse impact on our business. However, policy
changes and related uncertainty about policy changes could increase market volatility. Historically,
tariffs have led to increased trade and political tensions, between not only the U.S. and China, but also
51


--- page 61 ---
RISK FACTORS
between the U.S. and other countries in the international community. There is significant uncertainty as
to whether countries will be able to successfully reach any trade deals with the U.S. Rising political
tensions as a result of trade policies could reduce trade volume, investment, and other economic
activities between major international economies. These developments, or the perception that any of
them could occur, may have a material adverse effect on global economic conditions and the stability
of global financial markets, which in turn can adversely impact our business, results of operations.
We are required to comply with the applicable laws and regulations on environmental, social and
governance matters and changes in social trend and political policies relating to ESG may have a
material adverse impact on us.
There has been increasing awareness of matters relating to environmental, social and
governance (“ ESG”) from investors, regulatory authorities, and the general public. The PRC
government has been increasingly emphasizing the importance of ESG factors in recent years and has
implemented various laws and regulations accordingly. Failure to comply with such applicable laws
and regulations may subject us to penalties and adversely affect our business, financial condition,
results of operations and reputation.
In addition, there have been several policy initiatives aimed at promoting sustainable
development and corporate responsibility, and to eventually achieve carbon neutrality by 2060. We are
required to allocate our resources and effort to design governance systems in compliance with the
existing ESG regulations and new laws and regulations promulgated from time to time. Considering
the unpredictable nature of social trends, it could cost us a substantial amount of time and resources to
constantly monitor the latest developments in ESG laws and regulations that may become applicable to
us. Any potential changes in social trend and policies relating to ESG could significantly increase our
regulatory compliance costs or require us to alter our existing practices in a way that might interrupt
our business operation.
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 have maintained insurance coverage which includes mandatory social insurance and
director liability insurance. While our Directors are of the view that the amount of our insurance
coverage is in line with the industry practice 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, we do not
maintain keyman insurance, insurance policies covering damages to our network infrastructures or
information technology systems, nor any insurance policies for our properties. In addition, our insurers
will review our policies every year and we cannot guarantee that our policies can be renewed on
similar or other acceptable terms 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 shareholding structure is relatively dispersed and may subject us to uncertainties relating to
changes in our shareholders or their corporate structures.
Our shareholding structure is relatively dispersed and may be less stable than those of
companies with controlling shareholders, and may subject us to uncertainties relating to changes in our
Shareholders or their corporate structures. For example, if any of our current or future Shareholders are
52


--- page 62 ---
RISK FACTORS
viewed as being ultimately controlled by non-PRC holding companies, it may impact whether we are
viewed as having a sufficient level of our equity controlled by PRC shareholders for regulatory
purposes. Furthermore, the corporate structures of our Shareholders may need to be changed in the
future due to potential changes in applicable laws and regulations, which may lead to uncertainties in
our shareholding structure.
As some of our leased properties have title defects and did not complete registration procedures
at relevant authorities, we may be required to cease occupation and the use of such leased
properties.
As of the Latest Practicable Date, we did not own any property, and operated our businesses
mainly through leased properties. We cannot assure you that we would be able to renew the relevant
lease agreements without substantial additional cost or increase in the rental cost payable by us. If a
lease agreement is renewed at a rent substantially higher than the current rate, or currently existing
favorable terms granted by the lessor are not extended, our business and results of operations may be
adversely affected. As of the Latest Practicable Date, lessor of five of our leased properties had not
provided us with the property ownership certificate or any other documentation proving the rights to
lease the property to us, and the lease may be invalidated as a result. Furthermore, as of the Latest
Practicable Date, we had not yet completed the registration of twelve property lease contracts we
entered into in the PRC. As advised by our PRC Legal Advisors, failure to complete the lease
registration will not affect the validity of the lease agreements according to PRC law, but we may have
a maximum penalty of RMB10,000 imposed on us for each unregistered lease if we fail to complete
the registration of any of the lease agreements within due time as required by the competent PRC
government authorities. The estimated aggregate maximum penalty is RMB120,000 with respect to the
unregistered leases of properties leased by us.
If we fail to maintain an effective system of internal controls, we may not be able to accurately
report our financial results or effectively manage our business and may experience errors or
information lapses affecting our business.
Our success depends on our ability to effectively implement our standardized management
system, information systems, resources and internal controls. See “Business – Risk Management and
Internal Control.” As we continue to expand, we will need to maintain, modify and improve our
financial and managerial controls, reporting systems and procedures and other internal controls and
compliance procedures to meet our evolving business needs. If we are unable to improve our internal
controls, systems and procedures, they may become ineffective and adversely affect our ability to
manage our business and cause errors or information lapses that affect our business. Our efforts in
improving our internal control system may not result in eliminating all risks. If we are not successful in
discovering and eliminating weaknesses in our internal controls, our ability to effectively manage our
business may be affected.
RISKS RELATING TO DOING BUSINESS IN CHINA
Changes in China’s economic, political and social conditions, as well as government policies,
could have a material adverse effect on our business and prospects.
During the Track Record Period, we generated substantially all of our revenue in the PRC.
Accordingly, our financial condition, results of operations and prospects are, to a material extent,
53


--- page 63 ---
RISK FACTORS
subject to economic, political, and legal developments in China. In particular, factors such as
consumer, corporate and government spending, business investment, volatility of the capital markets
and inflation could affect the business and economic environment, the growth of the industries we
operate in and ultimately, the profitability of our business.
In recent years, the PRC government has implemented measures emphasizing the utilization of
market forces in economic reform and the establishment of sound corporate governance practices in
business enterprises. These economic reform measures may be adaptively refined or adjusted from
industry to industry or across different regions of the country. If the business environment in China
changes, our business in China may also be materially and adversely affected.
The PRC legal system is evolving, which leads to uncertainties that could adversely affect us.
We are incorporated under the laws of the PRC. The PRC legal system is based on written
statutes. Since the late 1970s, the PRC government has promulgated laws and regulations dealing with
economic matters, such as foreign investment, corporate organization and governance, commerce,
taxation and trade, with a view towards developing a comprehensive system of commercial law.
However, as many of these laws and regulations are relatively new and continue to evolve, the
interpretation and enforcement of these laws and regulations involve uncertainties. In addition, there is a
limited volume of published court decisions, which may be cited for reference but are not binding on
subsequent cases and have limited precedential value unless the Supreme People’s Court otherwise
provides. These uncertainties relating to the interpretation and implementation of PRC laws and
regulations may adversely affect the legal protections and remedies that are available to investors and us.
The PRC government’s procedural requirements regarding foreign currency conversion may
limit our foreign exchange transactions.
Currently, Renminbi still cannot be freely converted into any foreign currencies, and
conversion and remittance of foreign currencies are subject to PRC foreign exchange regulations. A
portion of our revenue must be converted into other currencies to meet our foreign currency
obligations. For example, we need to obtain foreign currency to make payments of declared dividends,
if any, on our H Shares. There is no assurance that, under a certain exchange rate, we will have
sufficient foreign exchange to meet our foreign exchange requirements. The value of Renminbi against
the U.S. dollar and other currencies fluctuates from time to time and is affected by a number of factors,
such as changes in global political and economic conditions, market supply and demand conditions and
the fiscal and foreign exchange policies prescribed by the PRC government. Any devaluation of
Renminbi may adversely affect the value of, and any dividends payable on, our H Shares in foreign
currencies.
Payment of dividends is subject to restrictions under PRC law.
Under PRC law, dividends may be paid only out of distributable profit. Our distributable profit
is our profit as determined under PRC GAAP or IFRS, whichever is lower, less any recovery of
accumulated losses and appropriations to statutory and other reserves that we are required to make. As
a result, we may not have sufficient or any distributable profit to enable us to make dividend
distributions to our Shareholders, including in years in which we are profitable. Any distributable profit
not distributed in a given year is retained and available for distribution in subsequent years.
54


--- page 64 ---
RISK FACTORS
In addition, we are required to comply with the dividend distribution rules prescribed by the
PRC regulatory authorities when determining our dividend payout ratios. The PRC regulatory
authorities may further amend the dividend distribution rules for listed companies in the future, which
could significantly affect the amount of capital available to support the development and growth of our
business.
Moreover, as the calculation of distributable profits under PRC GAAP is different from the
calculation under IFRS in certain respects, our subsidiaries may not have distributable profits as
determined under PRC GAAP, even if they have profits for that year as determined under IFRS, or
vice versa. Accordingly, we may not receive sufficient distributions from our subsidiaries. Failure by
our subsidiaries to pay dividends to us could have a negative impact on our cash flows and our ability
to distribute dividend to our Shareholders in the future, including those periods in which our financial
statements indicate that our operations have been profitable.
We may be subject to the approval or other requirements of the CSRC or other PRC
governmental authorities in connection with future capital raising activities.
On February 17, 2023, the CSRC released the Trial Administrative Measures of Overseas
Securities Offering and Listing by Domestic Companies (
ྤʫΆุྤ̮೯БᗇՎձɪ̹၍ଣ༊Б፬
) and the supporting guidance documents (collectively the “ Overseas Listing Regulations ”),
which came into effect on March 31, 2023. See “Regulatory Overview — Regulations on Overseas
Listing.”
As advised by our PRC Legal Advisors, we are required to go through the filing procedures
with the CSRC under the Overseas Listing Regulations for the Global Offering. We have submitted the
filing application for the Global Offering to the CSRC within the specific time limit as required by the
Overseas Listing Regulations. On April 14, 2025, the CSRC issued a notification confirming our
completion of the filing pursuant to the Overseas Listing Regulations for the Global Offering. Given
that the Overseas Listing Regulations were recently promulgated, there remain uncertainties as to their
interpretation, application, and enforcement and how they will affect our operations and our future
financing. In addition, it is uncertain whether we can or how long it will take us to complete such
filings. If we could not complete such filing procedure, we will suspend or terminate our application
for Listing.
In addition, according to the Overseas Listing Regulations, any future issuance or listing after
our IPO may also be subject to filing procedure of CSRC and we are also required to report certain
material matters to CSRC after our IPO. Any failure to perform such filing or reporting procedure
would subject us to administrative penalties by CSRC which could harm our reputation and may
adversely affect our results of financial condition.
You may experience difficulties in effecting service of legal process or enforcing foreign
judgments against us and our management.
We are incorporated under the laws of the PRC and all of our business and operations are
located in the PRC. In addition, almost all of our directors, supervisors and officers reside in China and
substantially all of their assets are located in China. As the cross-border service of legal process is
typically cumbersome and time-consuming, it may be difficult for investors outside China to effect
service of legal process upon those persons residing in China or to enforce against us or them in China
55


--- page 65 ---
RISK FACTORS
any judgments obtained from non-PRC courts. The PRC does not have treaties providing for the
reciprocal recognition and enforcement of judgments of courts of most other jurisdictions. As a result,
recognition and enforcement in the PRC of judgments of a court in any of these jurisdictions outside
China may be subject to uncertainties.
On January 18, 2019, the Supreme People’s Court of the PRC and Hong Kong entered into an
agreement regarding the scope of judgments which may be enforced between China and Hong Kong (

τર)( t h e“ New Arrangement ”).
On January 25, 2024, the Supreme People’s Court of the PRC published an Arrangement on Reciprocal
Recognition and Enforcement of Judgments in Civil and Commercial Matters (
ʫή
τર), which took effective on January 29,
2024 and replaced the Arrangement. The New Arrangement has broadened the scope of judgments that
may be enforced between China and Hong Kong under the Arrangement. Whereas a choice of
jurisdiction needs to be agreed in writing in the form of an agreement between the parties for the selected
jurisdiction to have exclusive jurisdiction ove r a matter under the Arrangement, the New Arrangement
provides that the court where the judgment was sought could apply jurisdiction in accordance with the
certain rules without the parties’ agreement. However, we cannot assure you that any action brought in
China by holders of H Shares to enforce a Hong Kong arbitration award made in favor of holders of H
Shares would succeed.
Furthermore, although we will be subject to the Listing Rules and the Takeovers Code upon the
listing of our H Shares on the Stock Exchange, the holders of H Shares will not be able to bring actions
on the basis of violations of the Listing Rules and must rely on the Stock Exchange to enforce its rules.
Moreover, the Takeovers Code does not have the force of law and provides only standards of
commercial conduct considered acceptable for takeover and merger transactions and share repurchases
in Hong Kong.
Disputes between holders of H Shares and us, our Directors, supervisors, senior officers or
holders of non-listed shares, arising out of our Articles of Association or the rights or obligations
conferred or imposed upon by the PRC Company Law and related rules and regulations concerning our
affairs, including the transfer of our H Shares, are to be resolved through arbitration rather than by a
court of law. A claimant may elect to submit a dispute to arbitration organizations in Hong Kong or in
China. Awards that are made by the PRC arbitral authorities recognized under the Arbitration
Ordinance of Hong Kong can be enforced in Hong Kong. Hong Kong arbitration awards may be
recognized and enforced by PRC courts, subject to the satisfaction of certain PRC legal requirements.
However, we cannot assure you that any action brought in China by any holder of H Shares to enforce
a Hong Kong arbitral award made in favor of holders of H Shares would succeed.
Holders of H Shares may be subject to PRC taxation.
Non-PRC resident individuals and non-PRC resident enterprises are subject to different tax
obligations with respect to dividends received from us or gains realized upon the sale or other
disposition of our H Shares in accordance with applicable PRC tax laws, rules and regulations.
Pursuant to the PRC Individual Income Tax Law (
), non-PRC
resident individuals are subject to a 20% PRC individual income tax on their dividend income derived
from China and we are required to withhold such tax from our dividend payments. If there is an
applicable tax treaty to avoid double taxation and taxation evasion between China and the jurisdiction
56


--- page 66 ---
RISK FACTORS
where the foreign individual resides, the applicable tax rate shall be determined in accordance with
such tax treaty. Considering that the applicable tax rate on dividends is usually 10% according to tax
treaties or tax agreements and that the number of stockholders is large for a listed company, to simplify
the tax administration, generally a domestic non-foreign-investment enterprise with shares listed in
Hong Kong can withhold dividend income tax at a rate of 10%. There remains uncertainty as to
whether gains realized by non-PRC resident individuals on disposition of H Shares are subject to PRC
individual income tax.
Pursuant to the PRC Enterprise Income Tax Law and other applicable PRC tax rules and
regulations, non-PRC resident enterprises that do not have establishments or premises in the PRC, or
have establishments or premises in the PRC but their income is not related to such establishments or
premises are subject to a 10% PRC enterprise income tax rate on dividend income received from a
PRC company and gains realized upon the sale or other dispositions of equity interest in a PRC
company. The 10% tax rate is subject to reduction under any special arrangements or applicable
treaties between China and the jurisdiction where the non-resident enterprise domiciles.
The interpretation and implementation of the PRC Enterprise Income Tax Law and other
applicable PRC tax rules and regulations by the PRC tax authorities are evolving, including whether
and how non-PRC resident H shareholders are subject to personal income tax or enterprise income tax
on gains realized upon the sale or other dispositions of their H shares. In addition, the value of your
investment in our H Shares may be materially affected by unfavorable changes in the applicable tax
rates currently stipulated by the PRC tax authorities.
See “Appendix III — Taxation and Foreign Exchange.”
RISKS RELATING TO THE GLOBAL OFFERING
There has been no prior public 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
is expected to be fixed by agreement between the Overall Coordinators and us, and 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 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.
In addition, the Hong Kong Stock Exchange and other securities markets have, from time to
time, experienced significant price and volume volatility that is not related to the operating
performance of any particular company.
57


--- page 67 ---
RISK FACTORS
Holders of our H Shares are subject to the risk that the price of our H Shares could fall during
the period before trading of our H Shares begins.
The Offer Price of our H Shares is expected to be determined on the Price Determination Date.
However, our H Shares will not commence trading on the Hong Kong Stock Exchange until they are
delivered, which is expected to be several business days after the pricing date. As a result, investors
may not be able to sell or deal in our H Shares during that period. The price and trading volume of the
H Shares may be highly volatile. Factors such as variations in our revenue, net profit and cash flows
and announcements of new investments, strategic alliances and acquisitions, fluctuations in market
prices for our products and solutions or fluctuations in market prices for other companies operating in
our industries could cause the market price of our H Shares to change substantially. Any such
developments may result in significant and sudden changes in the volume and price at which our H
Shares will trade. We cannot assure you that these developments will not occur in the future.
Accordingly, holders of our H Shares are subject to the risk that the price of our H Shares could fall
before trading begins as a result of adverse market conditions or other adverse developments, which
could occur between the time of sale and the time trading begins.
Future sales or perceived sales of substantial amounts of our H Shares in the public market could
have a material adverse effect on the prevailing market price of our H Shares and our ability to
raise additional capital in the future.
The market price of our H Shares could decline as a result of substantial future sales of our H
Shares or other securities relating to Shares in the public market. Such a decline could also occur with
the issuance of new Shares or other securities relating to our Shares, or the perception that such sales or
issuances may occur. Future sales, or perceived sales, of substantial amounts of our Shares could
materially adversely affect the prevailing market price of our H Shares and our ability to raise future
capital at a favorable time and price. Our shareholders would experience a dilution in their holdings
upon the issuance or sale of additional securities for any purpose.
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.
If securities or industry analysts do not publish research or reports about our business, or if they
adversely change their recommendations regarding our H Shares, the market price and trading
volume for our H Shares could decline.
The trading market for our H Shares will be influenced by research or reports that industry or
securities analysts publish about us or our business. If one or more analysts who cover us downgrade
our H Shares or publishes negative opinions about us, the market price for our H Shares would likely
decline regardless of the accuracy of the information. If one or more of these analysts cease coverage
of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which,
in turn, could cause the market price or trading volume of our H Shares to decline.
58


--- page 68 ---
RISK FACTORS
We cannot assure you whether and when we will declare and pay dividends in the future.
Our ability to pay dividends will depend on whether we are able to generate sufficient earnings.
Distribution of dividends shall be decided by our Board of Directors at their discretion and will be
subject to the approval of the general meeting. A decision to declare or to pay dividends and the
amount thereof depend on various factors, including but not limited to our results of operations, cash
flows and financial position, operating and capital expenditure requirements, distributable profits as
determined under PRC GAAP or IFRS (whichever is lower), our Articles of Association and other
constitutional documents, the PRC Company Law and any other applicable PRC laws and regulations,
market conditions, our strategy and projection for our business, contractual restrictions and obligations,
taxation, regulatory restrictions and any other factors from time to time deemed by our Board of
Directors as relevant to the declaration or suspension of dividends. As a result, there can be no
assurance whether, when and in what form we will pay dividends in the future. Subject to any of the
above constraints, we may not be able to pay dividends in accordance with our dividend policy. See
“Financial Information – Dividend.”
Fluctuations in exchange rates may result in foreign currency exchange losses and may have a
material adverse effect on your investment.
The value of RMB against the Hong Kong dollar, the U.S. dollar and other currencies fluctuates
subject to changes resulting from foreign exchange and monetary policies and depends on a large
extent regarding domestic and international economic and political developments as well as supply and
demand in the local market. With the development of the foreign exchange market and progress
towards interest rate liberalization and RMB internationalization, the PRC government may in the
future announce further changes to the exchange rate system and we cannot assure you that RMB will
not appreciate or depreciate significantly in value against the U.S. dollar in the future. It is difficult to
predict how market forces or government policies may impact the exchange rate between the RMB and
the Hong Kong dollar, the U.S. dollar or other currencies in the future.
Any depreciation of the RMB may adversely affect the value of, and any dividends payable on,
the Shares in foreign currency. In addition, there are limited instruments available for us to reduce our
foreign currency risk exposure at reasonable costs. Furthermore, we are also currently required to
obtain the SAFE’s approval before converting significant sums of foreign currencies into RMB. All of
these factors could materially and adversely affect our business, financial condition, results of
operations and prospects, and could reduce the value of, and dividends payable on, the Shares in
foreign currency terms.
Should the Offer Price be higher than the net tangible book value per Share, subject to pricing,
you may experience an immediate dilution in the book value of the Offer Shares you purchased
in the Global Offering and may experience further dilution if we issue additional Shares in the
future.
The Offer Price of the Offer Shares may be higher than the net tangible book value per Share
immediately prior to the Global Offering. As a result, you and other purchasers of the Offer Shares in
the Global Offering may experience an immediate dilution, and our existing Shareholders will receive
an increase in the net tangible assets per Share. To expand our business, we may consider offering and
issuing additional H Shares in the future. Purchasers in the Global Offering may experience dilution
further in the net tangible asset value per share if we issue additional H Shares in the future.
59


--- page 69 ---
RISK FACTORS
We cannot assure you of the accuracy or completeness of certain facts, forecasts and other
statistics obtained from various government publications contained in this prospectus.
This document, particularly the section headed “Industry Overview,” contains information and
statistics relating to the industry in which we operate. Such information and statistics have been
derived from various official government publications. However, we cannot guarantee the quality or
reliability of such source materials. The information has not been independently verified by us, the
Joint Sponsors, the Sponsor-Overall Coordinators, the Overall Coordinators, the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries, the
Underwriters or any other party involved in the Global Offering, and no representation is given as to its
accuracy. Collection methods of such information may be flawed or ineffective, or there may be
discrepancies between published information and market practice, which may result in the statistics
included in this document being inaccurate or not comparable to statistics produced for other
economies. You should therefore not place undue reliance on such information. In addition, we cannot
assure you that such information is stated or compiled on the same basis or with the same degree of
accuracy as similar statistics presented elsewhere. You should consider carefully the importance placed
on such information or statistics.
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.
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.
60


--- page 70 ---
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
In preparation for the Global Offering, we have sought the following waivers from strict
compliance with the relevant provisions of the Listing Rules:
WAIVER 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 the requir
ement in Rule 8.12 of the Listing Rules may be waived by having regard to, among other
considerations, our arrangements for maintaining regular communication with the Hong Kong Stock
Exchange, including but not limited to compliance by us with Rules 19A.05 to 19A.07 of the Listing
Rules.
Our headquarters are based, and substantially all of the business operations of our Company
and our subsidiaries are managed and conducted in the PRC. Our executive Directors ordinarily reside
in the PRC and they play important roles in our Company’s business operations. It is in our best
interests for them to be based in places where our Group has significant operations. We consider it
practically difficult and commercially unreasonable for us to arrange for two executive Directors to be
ordinarily resident in Hong Kong, either by means of relocation of our existing executive Directors or
appointment of additional executive Directors. Therefore, our Company does not have, and does not
contemplate in the foreseeable future that we will have sufficient management presence in Hong Kong
for the purpose of satisfying the requirements under Rules 8.12 of the Listing Rules.
Accordingly, pursuant to Rule 19A.15 of the Listing Rules, we have applied to the Hong Kong
Stock Exchange for, and the Hong Kong Stock Exchange has granted us, a waiver from strict
compliance with Rules 8.12 and Rule 19A.15 of the Listing Rules subject to the following conditions:
(i) We have appointed Dr. Huang and Ms. Wong Wai Yee, Ella (“ Ms. Wong ”) as our
authorized representatives (“ Authorized Representatives ”) pursuant to Rules 3.05 and
19A.07 of the Listing Rules. The Authorized Representatives will act as our Company’s
principal channel of communication with the Hong Kong Stock Exchange. The Authorized
Representatives will be readily contactable by phone, facsimile and email to promptly deal
with enquiries from the Hong Kong Stock Exchange, and will also be available to meet
with the Hong Kong Stock Exchange to discuss any matter within a reasonable period of
time upon request of the Hong Kong Stock Exchange;
(ii) When the Hong Kong Stock Exchange wishes to contact our Directors on any matter, each
of the Authorized Representatives will have all necessary means to contact all of our
Directors (including our independent non-executive Directors) promptly at all times. Our
Company will also inform the Hong Kong Stock Exchange promptly in respect of any
changes in the authorized representatives. We have provided the Hong Kong Stock
Exchange with the contact details (i.e. mobile phone number, office phone number and
email address) of all Directors to facilitate communication with the Hong Kong Stock
Exchange;
(iii) All Directors who do not ordinarily reside in Hong Kong possess or can apply for valid
travel documents to visit Hong Kong and can meet with the Hong Kong Stock Exchange
within a reasonable period upon the request of the Stock Exchange;
(iv) We have appointed Haitong International Capital Limited as our compliance advisor (the “
Compliance Advisor ”) upon listing pursuant to Rule 3A.19 of the Listing Rules for a
61


--- page 71 ---
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
period commencing on the Listing Date and ending on the date on which we comply with
Rule 13.46 of the Listing Rules in respect of our financial results for the first full financial
year commencing after the Listing Date. The Compliance Advisor, who will act as the
additional channel of communication with the Hong Kong Stock Exchange when the
Authorized Representatives are not available, will have access at all times to our
Authorized Representatives, our Directors and our senior management as prescribed by
Rule 19A.05(2) of the Listing Rules; and
(v) We will inform the Stock Exchange as soon as practicable in respect of any change in our
Authorized Representatives, our Directors and/or our Compliance Advisor in accordance
with the Listing Rules.
WAIVER IN RESPECT OF APPOINTMENT OF JOINT COMPANY SECRETARY
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 Hong Kong Stock Exchange, capable of discharging the functions of the company
secretary. Note 1 to Rule 3.28 of the Listing Rules provides that the Hong Kong Stock Exchange
considers the following academic or professional qualifications to be acceptable:
(i) a member of The Hong Kong Institute of Chartered Secretaries;
(ii) a solicitor or barrister as defined in the Legal Practitioners Ordinance (Chapter 159 of the
Laws of Hong Kong); and
(iii) a certified public accountant as defined in the Professional Accountants Ordinance
(Chapter 50 of the Laws of Hong Kong).
Note 2 to Rule 3.28 of the Listing Rules further provides that the Hong Kong Stock Exchange
considers the following factors in assessing the “relevant experience” of the individual:
(i) length of employment with the issuer and other issuers and the roles he/she played;
(ii) familiarity with the Listing Rules and other relevant laws and regulations including the
SFO, the Companies 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.
Our Company has appointed Ms. Li Na (
ࢆ“() Ms. Li”), our Chief Financial Officer, as one of
our joint company secretaries. She has extensive experience in handling board, corporate management
and administrative matters relating to the Company but presently does not possess any of the
qualifications under Rules 3.28 and 8.17 of the Listing Rules, and may not be able to solely fulfill the
requirements of the Listing Rules. Therefore, we have appointed Ms. Wong, a Chartered Secretary, a
Chartered Governance Professional and a Fellow of both The Hong Kong Chartered Governance Institute
and The Chartered Governance Institute in the United Kingdom, who fully meets the requirements
stipulated under Rules 3.28 and 8.17 of the Listing Rules to act as the other joint company secretary and
to provide assistance to Ms. Li for an initial period of three years from the Listing Date to enable Ms. Li
to acquire the “relevant experience” under Note 2 to Rule 3.28 of the Listing Rules so as to fully comply
with the requirements set forth under Rules 3.28 and 8.17 of the Listing Rules.
62


--- page 72 ---
WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
Since Ms. Li does not possess the formal qualifications required of a company secretary under
Rule 3.28 of the Listing Rules, we have applied to the Hong Kong Stock Exchange for, and the Hong
Kong Stock Exchange has granted us, a waiver from strict compliance with the requirements under
Rules 3.28 and 8.17 of the Listing Rules such that Ms. Li may be appointed as a joint company
secretary of our Company. Pursuant to Chapter 3.10 of the Guide for New Listing Applicants issued by
the Stock Exchange, the waiver will be for a fixed period of time (“ Waiver Period ”) and on the
following conditions: (i) the proposed company secretary must be assisted by a person who possesses
the qualifications or experience as required under Rule 3.28 (“ Qualified Person”) and is appointed as
a joint company secretary throughout the Waiver Period; and (ii) the waiver can be revoked if there are
material breaches of the Listing Rules by the issuer. The waiver is valid for an initial period of three
years from the Listing Date, and is granted on the condition that Ms. Wong will work closely with Ms.
Li to jointly discharge the duties and responsibilities as company secretary and assist Ms. Li in
acquiring the relevant experience as required under Rules 3.28 and 8.17 of the Listing Rules.
Ms. Wong will also assist Ms. Li in organizing Board meetings and Shareholders’ meetings of our
Company as well as other matters of our Company which are incidental to the duties of a company
secretary. Ms. Li is expected to work closely with Ms. Wong and will maintain regular contact with the
Directors, the Supervisors and the senior management of our Company. The waiver will be revoked
immediately if Ms. Wong or other person who meets the requirements stipulated under Rules 3.28 and
8.17 of the Listing Rules ceases to provide assistance to Ms. Li as a joint company secretary for the
three-year period after the Listing or where there are material breaches of the Listing Rules by our
Company. In addition, Ms. Li will comply with the annual professional training requirement under
Rule 3.29 of the Listing Rules and will enhance her knowledge of the Listing Rules during the three-
year period from the Listing. Ms. Li will also be assisted by (a) Compliance Advisor of our Company,
particularly in relation to compliance with the Listing Rules; and (b) the Hong Kong legal advisors of
our Company, on matters concerning our Company’s ongoing compliance with the Listing Rules and
the applicable laws and regulations.
Before the expiration of the initial three-year period, the qualifications of Ms. Li will be re-eva
luated to determine whether the requirements as stipulated in Rules 3.28 and 8.17 of the Listing Rules
can be satisfied and whether the need for ongoing assistance will continue. We will liaise with the
Hong Kong Stock Exchange to enable it to assess whether Ms. Li, having benefited from the assistance
of Ms. Wong or other person who meets the requirements stipulated under Rules 3.28 and 8.17 of the
Listing Rules 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.
63


--- page 73 ---
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
DIRECTORS’ RESPONSIBILITY FOR THE CONTENTS OF THIS PROSPECTUS
This prospectus, for which our Directors collectively and individually accept full responsibility,
includes particulars given in compliance with the Companies (Winding Up and Miscellaneous
Provisions) Ordinance, the Securities and Futures (Stock Market Listing) Rules (Chapter 571V of the
Laws of Hong Kong) and the Listing Rules for the purpose of giving information to the public with
regard to our Group. Our Directors, having made all reasonable enquiries, confirm that to the best of
their knowledge and belief the information contained in this prospectus is accurate and complete in all
material respects and not misleading or deceptive, and there are no other matters the omission of which
would make any statement herein or this prospectus misleading.
CSRC FILING REQUIREMENT
The CSRC issued notice of filing on April 14, 2025 for the Global Offering and for the
submission of the application to list our H Shares on the Hong Kong Stock Exchange. In granting its
notice of filing, the CSRC accepts no responsibility for our financial soundness, nor for the accuracy of
any of the statements made or opinions expressed in this prospectus.
UNDERWRITING AND INFORMATION ON THE GLOBAL OFFERING
This prospectus is published solely in connection with the Hong Kong Public Offering, which
forms part of the Global Offering. For applicants under the Hong Kong Public Offering, this
prospectus contain the terms and conditions of the Hong Kong Public Offering.
The Hong Kong Offer Shares are offered solely on the basis of the information contained and
representations made in this prospectus and on the terms and subject to the conditions set out herein and
therein. No person is authorized to give any information in connection with the Global Offering or to
make any representation not contained in this prospectus, and any information or representation not
contained herein and therein must not be relied upon as having been authorized by our Company, the
Joint Sponsors, the Sponsor-Overall Coordinators, the Overall Coordinators the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries, and
any of the Underwriters, any of their respective directors, agents, employees or advisers or any other
party involved in the Global Offering.
The Listing 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 under the terms of the Hong Kong
Underwriting Agreement, subject to agreement on the Offer Price to be determined between the
Overall Coordinators (on behalf of the Hong Kong Underwriters) and our Company on the Price
Determination Date. The International Placing is expected to be fully underwritten by the International
Underwriters subject to the terms and conditions of the International Underwriting Agreement, which
is expected to be entered into on or about the Price Determination Date.
Neither the delivery of this prospectus nor any subscription made under it shall, under any
circumstances, constitute a representation that there has been no change or development reasonably
likely to involve a change in our affairs since the date of this prospectus or imply that the information
contained in this prospectus is correct as of any date subsequent to the date of this prospectus.
64


--- page 74 ---
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
See “Underwriting” for further information about the Underwriters and the underwriting
arrangements.
SELLING RESTRICTIONS ON OFFERS AND SALE OF THE OFFER SHARES
Each person acquiring the Hong Kong Offer Shares under the Hong Kong Public Offering will
be required to or be deemed by his/her acquisition of Offer Shares to, confirm that he/she is aware of
the restrictions on offers for the Offer Shares described in this prospectus.
No action has been taken to permit a public offering of the Offer Shares in any jurisdiction
other than in 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 in any jurisdiction or in any circumstances in which such an offer or invitation is not
authorized or to any person to whom it is unlawful to make such an offer or invitation. The distribution
of this prospectus and the offering and 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.
APPLICATION FOR LISTING ON THE STOCK EXCHANGE
We have applied to the Listing Committee for the listing of, and permission to deal in, our H
Shares to be issued pursuant to (i) the Global Offering (including the Shares which may be issued
pursuant to the exercise of the Over-allotment Option) and (ii) the H Shares to be converted from our
existing Domestic Unlisted Shares.
No part of our H Shares or loan capital is listed on or dealt in on any other stock exchange and
no such listing or permission to list is being or proposed to be sought in the future. All Offer Shares
will be registered on the Hong Kong Share Registrar of our Company in order to enable them to be
traded on the Stock Exchange.
Under section 44B(1) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, any allotment made in respect of any application will be invalid if the listing of, and
permission to deal in, the H Shares on the Hong Kong Stock Exchange is refused before the expiration
of three weeks from the date of the closing of the application lists, or such longer period (not exceeding
six weeks) as may, within the said three weeks, be notified to the Company by or on behalf of the
Hong Kong Stock Exchange.
COMMENCEMENT OF DEALINGS IN OUR SHARES
Dealings in our H Shares on the Stock Exchange are expected to commence at 9:00 a.m. on
Monday, June 30, 2025.
Our Shares will be traded in board lots of 20 H Shares each. The stock code of our H Shares is
9678.
ADMISSION OF OUR H SHARES INTO CCASS
Subject to the granting of listing of, and permission to deal in, our H Shares on the Stock
Exchange and our compliance with the stock admission requirements of HKSCC, our H Shares will be
65


--- page 75 ---
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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 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.
REGISTER OF MEMBERS AND HONG KONG STAMP DUTY
Our Company’s principal register of members will be maintained by us in our headquarters in
the PRC.
All of the H Shares issued pursuant to applications made in the Hong Kong Public Offering and
the International Offering and converted from our Domestic Unlisted Shares and Unlisted Foreign
Shares 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. Dealings in the H Shares registered in our
Hong Kong register of members will be subject to Hong Kong stamp duty.
DIVIDENDS PAYABLE TO HOLDERS OF H SHARES
Unless determined otherwise by the Company, dividends payable in Hong Kong dollars in
respect of our H Shares will be paid to the Shareholders as recorded on the H Share register of the
Company in Hong Kong and sent by ordinary post, at the Shareholders’ risk, to the registered address
of each Shareholder.
According to the Guide to the Program for “Full Circulation” of H shares promulgated by
China Securities Depository and Clearing Corporation Limited (“CSDC”) on February 7, 2020, cash
dividends to domestic investors of H-share “full circulation” shall be distributed through CSDC. An
H-share listed company shall transfer RMB cash dividends to the designated bank account of the
Shenzhen subsidiary of CSDC, who shall complete the clearing of cash dividends by distributing the
cash dividends to investors through domestic securities companies.
REGISTRATION OF SUBSCRIPTION, PURCHASE AND TRANSFER OF H SHARES
We have instructed Tricor Investor Services Limited, our H Share Registrar, and it has agreed
not to register the subscription, purchase or transfer of any H Shares in the name of any particular
holder unless and until the holder delivers a signed form to our H Share Registrar in respect of those H
Shares bearing statements to the effect that the holder:
Š agrees with us and each of our Shareholders, and we agree with each Shareholder, to
observe and comply with the PRC Company Law and our Articles of Association;
Š agrees with us, each of our Shareholders, Directors, Supervisors, managers and officers,
and we acting for ourselves and for each of our Directors, Supervisors, managers and
officers agree with each of our Shareholders, to refer all differences, disputes and claims
concerning our affairs and arising from any rights or obligations conferred or imposed by
our Articles of Association, the PRC Company Law or other relevant laws, rules and
66


--- page 76 ---
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
regulations to arbitration in accordance with our Articles of Association, and any reference
to arbitration shall be deemed to authorize the arbitration tribunal to conduct hearings in
open session and to publish its award. Such arbitration shall be final and conclusive;
Š agrees with us and each of our Shareholders that the H Shares are freely transferable by
the holders thereof; and
Š authorizes us to enter into a contract on his/her behalf with each of our Directors,
Supervisors, senior officers whereby such Directors, Supervisors, senior officers undertake
to observe and comply with their obligations to our Shareholders as stipulated in our
Articles of Association. Persons applying for or purchasing H Shares under the Global
Offering are deemed, by their making an application or purchase, to have represented that
they are not close associates (as defined in the Listing Rules) of any of the Directors,
Supervisors or an existing Shareholder of the Company or a nominee of any of the
foregoing.
PROFESSIONAL TAX ADVICE RECOMMENDED
Potential investors in the Global Offering are recommended to consult their professional
advisers if they are in any doubt as to the taxation implications of subscribing for, holding and dealing
in the H Shares or exercising any rights attached to them. It is emphasized that none of us, the Joint
Sponsors, the Sponsor-Overall Coordinators, the Overall Coordinators, the Joint Global Coordinators,
the Joint Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries, the Underwriters,
any of our/their respective affiliates, directors, supervisors, employees, agents or advisers or any other
party involved in the Global Offering accepts responsibility for any tax effects on, or liabilities of
holders of the H Shares resulting from the subscription, purchase, holding or disposal of the H Shares
or exercising any rights attached to them.
OVER-ALLOTMENT AND STABILIZATION
Details of the arrangements relating to the Over-allotment and stabilization are set out in
“Structure of the Global Offering.”
EXCHANGE RATE CONVERSION
Solely for convenience purposes, this prospectus includes translations among certain amounts
denominated in Renminbi, Hong Kong dollars and U.S. dollars.
Unless otherwise specified, this prospectus contains certain translations for the convenience
purposes at the following rates: Renminbi into Hong Kong dollars at the rate of HK$1.00 to
RMB0.91537, Renminbi into U.S. dollars at the rate of US$1.00 to RMB7.184 and Hong Kong dollars
into U.S. dollars at the rate of US$1.00 to HK7.84819. The RMB to HK$ and US$ to RMB exchange
rates are quoted by the PBOC for foreign exchange transactions prevailing on June 10, 2025.
No representation is made that any amounts in RMB or Hong Kong dollars can be or could
have been at the relevant dates converted at the above rate or any other rates.
DETERMINATION OF THE OFFER PRICE
The Offer Price is expected to be determined between the Overall Coordinators (on behalf of
the Underwriters) and our Company on the Price Determination Date. The Price Determination Date is
67


--- page 77 ---
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
expected to be on or around Thursday, June 26, 2025 and, in any event, not later than Thursday,
June 26, 2025 (unless otherwise determined between the Overall Coordinators (on behalf of the
Underwriters) and our Company. If, for whatever reason, the Offer Price is not agreed between the
Overall Coordinators (on behalf of the Underwriters and our Company on or before 12:00 noon on
Thursday, June 26, 2025, the Global Offering will not become unconditional and will lapse
immediately.
PROCEDURES FOR APPLICATION FOR HONG KONG OFFER SHARES
The application procedures for the Hong Kong Offer Shares are set forth in “How to Apply for
Hong Kong Offer Shares.”
STRUCTURE AND CONDITIONS OF THE GLOBAL OFFERING
Details of the structure of the Global Offering, including its conditions, are set forth in
“Structure of the Global Offering.”
LANGUAGE
If there is any inconsistency between the English version of this prospectus and the Chinese
translation of this prospectus, the English version of this prospectus shall prevail unless otherwise
stated. However, if there is any inconsistency between the names of any of the entities mentioned in
this English prospectus which are not in the English language and their English translations, the names
in their respective original languages shall prevail.
ROUNDING
Any discrepancies in any table in this prospectus between total and sum of amounts listed
therein are due to rounding.
68


--- page 78 ---
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE
GLOBAL OFFERING
For further information on our Directors and Supervisors, please refer to the section
headed “Directors, Supervisors and Senior Management” of this prospectus.
DIRECTORS
Name Address Nationality
Executive Directors
Dr. Liang Jia’en
(ࢸ࢕.............)
No. 9 Courtyard, Beiwa Road
Haidian District, Beijing
PRC
Chinese
Dr. Huang Wei
(
රਃ) ..............
Room 415,
No. 230 Jiujiang Road
Huangpu District, Shanghai
PRC
Chinese
Dr. Kang Heng
(
ੰ㛬) ..............
Room 202, Unit 8, Building 124
Nanhu Zhongyuan No. 1 Courtyard
Chaoyang District, Beijing
PRC
Chinese
Mr. Li Xiaohan
(
ҽቢఫ).............
Room 907, Unit 7, Building 12
Wanliu Wanquan Xinxin Courtyard
Haidian District, Beijing
PRC
Chinese
Mr. Liu Shengping
(
ᄎʺ̻).............
Room 501, Unit 3
Building 30, Hepingli No. 7 District
Dongcheng District, Beijing
PRC
Chinese
Mr. Li Peng
(
ҽᘄ) ..............
Room 303, Gate 2
Building 18, Yuzhong Xili
Xicheng District, Beijing
PRC
Chinese
Non-executive Directors
Mr. Duane Kuang
(
⿼ɿ̻).............
Room 5542, Four Seasons Place
No. 8 Finance Street
Central
Hong Kong
Chinese (Hong Kong)
Mr. Li Zhichao
(
ҽқ൴).............
Room 401, No. 1, Lane 60
Jinhuinan Road
Shanghai
PRC
Chinese
Mr. Wang Cunfu
(
ӓπబ).............
Department of Electronics
No. 27 Wanshou Road
Haidian District, Beijing
PRC
Chinese
69


--- page 79 ---
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE
GLOBAL OFFERING
Name Address Nationality
Mr. Li Ang
(׻..............)
No. 302, Unit 4
5/F, Hepingli No. 3 Zone
Dongcheng District, Beijing
PRC
Chinese
Independent non-executive Directors
Mr. Hu Jianjun
(ࠏܔߡ.............)
Room 301
No. 7, Lane 188
Mingyue Road
Pudong New Area, Shanghai
PRC
Chinese
Mr. Fan Jian
(
ᅾ਄) ..............
Room 504
No. 10, Lane 323
Hongguan Road
Hongkou District, Shanghai
PRC
Chinese
Ms. Jin Huihua
(
ᅆശ).............
No. 53, Lane 1298
Xinnan Road
Songjiang District, Shanghai
PRC
Chinese
Dr. Zhang Kun
(
ੵտ) ..............
8 Hoi Fai Rd
The Long Beach
Tower 7 46/F
Flat D, Hong Kong
Chinese (Hong Kong)
Mr. Chen Hua
(
௓ശ) ..............
No. 3060, Jiahao Villa
Houshayu Area
Shunyi District, Beijing
PRC
Chinese
SUPERVISORS
Name Address Nationality
Mr. Shan Bo
(ت..............)
No. 114, Brick Factory North Lane
Tongzhou District, Beijing
PRC
Chinese
Mr. Ren He
(
΂ͫ) ..............
Room 501, Gate 4, 5/F, Building 1
No. 117 Yard, Wukesong Road
Haidian District, Beijing
PRC
Chinese
Mr. Hong Zhao
(
Ί) ..............
Room 1501, Building 8
No. 14 Zaojun Temple
Haidian District, Beijing
PRC
Chinese
70


--- page 80 ---
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE
GLOBAL OFFERING
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
Haitong International Capital Limited
Suites 3001-3006 & 3015-3016
30/F, One International Finance Centre
No. 1 Harbour View Street
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
Haitong International Securities Company Limited
22/F Li Po Chun Chambers
189 Des Voeux Road Central
Hong Kong
Overall Coordinators and Joint Global
Coordinators
China International Capital Corporation Hong Kong
Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Haitong International Securities Company Limited
22/F Li Po Chun Chambers
189 Des Voeux Road Central
Hong Kong
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught Road
Central
Hong Kong
71


--- page 81 ---
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE
GLOBAL OFFERING
Joint Bookrunners China International Capital Corporation Hong Kong
Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Haitong International Securities Company Limited
22/F Li Po Chun Chambers
189 Des Voeux Road Central
Hong Kong
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Orient Securities (Hong Kong) Limited
28th and 29th Floor
100 Queen’s Road Central
Hong Kong
CMBC Securities Company Limited
45/F, One Exchange Square
8 Connaught Place Central
Hong Kong
Tiger Brokers (HK) Global Limited
23/F, Li Po Chun Chambers
189 Des Voeux 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
Haitong International Securities Company Limited
22/F Li Po Chun Chambers
189 Des Voeux Road Central
Hong Kong
ABCI Securities Company Limited
10/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Orient Securities (Hong Kong) Limited
28th and 29th Floor
100 Queen’s Road Central
Hong Kong
72


--- page 82 ---
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE
GLOBAL OFFERING
CMBC Securities Company Limited
45/F, One Exchange Square
8 Connaught Place
Central
Hong Kong
Tiger Brokers (HK) Global Limited
23/F, Li Po Chun Chambers
189 Des Voeux 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
Haitong International Securities Company Limited
22/F Li Po Chun Chambers
189 Des Voeux 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
Orient Securities (Hong Kong) Limited
28th and 29th Floor
100 Queen’s Road Central
Hong Kong
CMBC Securities Company Limited
45/F, One Exchange Square
8 Connaught Place
Central Hong Kong
Tiger Brokers (HK) Global Limited
23/F, Li Po Chun Chambers
189 Des Voeux Road Central
Hong Kong
Auditor and Reporting Accountant PricewaterhouseCoopers
Certified Public Accountants and Registered Public
Interest Entity Auditor
22/F, Prince’s Building
Central
Hong Kong
73


--- page 83 ---
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE
GLOBAL OFFERING
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 and data security law:
Han Kun Law Office
9/F, Office Tower C1
Oriental Plaza, 1 East Chang An Avenue
Dongcheng District, Beijing 100738
PRC
As to PRC law:
Grandway Law Offices
7-8/F, News Plaza
No. 26 Jianguomennei Avenue
Dongcheng District
Beijing, PRC
Legal Advisors to the Joint Sponsors
and the Underwriters
As to Hong Kong and U.S. laws:
Paul Hastings
22/F, Bank of China Tower
1 Garden Road
Central
Hong Kong
As to PRC law:
Jingtian & Gongcheng
34/F, Tower 3, China Central Place
77 Jianguo Road
Beijing
PRC
Industry Consultant Frost & Sullivan (Beijing) Inc., Shanghai Branch Co.
Suite 2504
Wheelock Square
1717 Nanjing West Road
Shanghai
PRC
Receiving Bank China CITIC Bank International Limited
80 Floor
International Commerce Centre
1 Austin Road West
Kowloon
Hong Kong
74


--- page 84 ---
CORPORATE INFORMATION
Registered Office No. 101, 1/F, Building One
Xisanqi Jiancaicheng
Haidian District, Beijing
PRC
Headquarters and Principal Place of
Business in the PRC
No. 101-124, 1/F, Building One
Xisanqi Jiancaicheng
Haidian District, Beijing
PRC
Principal Place of Business in Hong
Kong Room 1915, 19/F
Lee Garden One
33 Hysan Avenue
Causeway Bay
Hong Kong
Company’s Website www.unisound.com (The information on the website
does not form part of this prospectus )
Joint Company Secretaries Ms. Li Na (
ࢆ)
Fuli Taoyuan
Haidian District, Beijing
PRC
Ms. Wong Wai Yee, Ella (
䔔ᅆՅ) (a Chartered
Secretary, a Chartered Governance Professional and a
fellow of both The Hong Kong Chartered Governance
Institute and The Chartered Governance Institute in the
United Kingdom)
Room 1915, 19/F
Lee Garden One
33 Hysan Avenue
Causeway Bay
Hong Kong
Authorized Representatives Dr. Huang Wei (
රਃ)
Room 415,
No. 230 Jiujiang Road
Huangpu District, Shanghai
PRC
Ms. Wong Wai Yee, Ella (
䔔ᅆՅ)
Room 1915, 19/F
Lee Garden One
33 Hysan Avenue
Causeway Bay
Hong Kong
Audit Committee Mr. Hu Jianjun (Chairman)
Ms. Jin Huihua
Mr. Fan Jian
Remuneration Committee Dr. Zhang Kun (Chairman)
Mr. Fan Jian
Dr. Huang Wei
75


--- page 85 ---
CORPORATE INFORMATION
Nomination Committee Mr. Chen Hua (Chairman)
Dr. Liang Jia’en
Ms. Jin Huihua
Compliance Adviser Haitong International Capital Limited
Suites 3001-3006 & 3015-3016
30/F, One International Finance Centre
No. 1 Harbour View Street
Central
Hong Kong
H Share Registrar Tricor Investor Services Limited
17/F, Far East Finance Centre
16 Harcourt Road
Hong Kong
Principal Bank Industrial and Commercial Bank of China branch in
Beijing Garden East Road
No. 8 Garden East Road
Haidian District, Beijing
PRC
76


--- page 86 ---
INDUSTRY OVERVIEW
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 Frost & Sullivan Report issued by Frost & Sullivan, 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 Sponsor-Overall Coordinators, the
Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners, and the Joint Lead
Managers, any of the Capital Market Intermediaries, any of the Underwriters, any of our or their
respective directors, officers or representatives or any other person involved in the Global
Offering and no representation is given as to their correctness or accuracy. Accordingly, you
should not place undue reliance on such information or statistics.
ARTIFICIAL INTELLIGENCE SOLUTIONS IN CHINA
Artificial Intelligence is a branch of computer science that aims to empower machines to
simulate human intelligence and imitate cognitive functions, associated with learning, reasoning and
problem-solving. AI works in two main phases, namely, training and inference. An AI model learns to
analyze a predetermined set of data in the training phase and makes predictions based on novel data to
produce actionable results in the inference phase.
Artificial general intelligence, also known as strong AI or deep AI, is the ability of machines to
think, comprehend, learn and apply their intelligence to solve complex problems much like humans. One
potential approach to achieve AGI is by using pre-trained, large-scale multimodal foundation models. For
example, advanced large language models, such as the GPT, enable machines to perform language-
related tasks with high accuracy, leading to breakthroughs in multiple sectors of the AI industry and new
possibilities for human-machine interaction.
AI solutions are ready-to-use and automated analytic AI programs that generate accurate and
meaningful insights responding to new business trends and customer demands. AI solutions can be
deployed through hardware, software or cloud computing services.
Market Size
Driven by economy growth and evolving customer needs, the AI solution market in China
increased from RMB42.2 billion in 2019 to RMB180.4 billion in 2024, with a CAGR of 33.7%,
according to Frost & Sullivan, and is expected to reach RMB1,174.9 billion in 2030, representing a
CAGR of 36.7% from 2024 to 2030.
77


--- page 87 ---
INDUSTRY OVERVIEW
42.2 52.4 72.1 93.7
135.5
180.4
246.7
351.3
491.5
671.3
899.3
1,174.9
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
Source: Public information, Expert interview, Frost & Sullivan Analysis
Period CAGR
2019-2024 33.7%
2024-2030E 36.7%
Market Size of AI Solution in China, 2019-2030E
Note: The market size is measured by the total revenue of AI solution providers in China, including integrated solution, software, hardware and services.
Billion RMB
The AI solution market in China is primarily driven by the following factors:
Š Advancement in Technology : Anticipated advancements in computing power, modeling
approaches, and data quality and volume will shape the future of AI, driving the
development of more intelligent, conversational and capable AI systems. Improvements in
computing power, such as more powerful GPUs and potential breakthroughs in quantum
computing can enhance the ability to build more powerful AI at lower costs. The
exponential growth of data volume worldwide and the commercialization of 5G
technologies will provide ample datasets for training AI algorithms, leading to improved
accuracy and a wider range of AI applications with diverse training. Furthermore, the
evolution of deep learning methodologies drives the advancement of AI models,
enhancing the performance and accuracy in various AI-related domains. For instance, the
introduction of recently released AGI system has fundamentally transformed the
AI solution market. It demonstrated AGI’s ability to surpass human capabilities in
economically valuable tasks, foresee and address challenges, and apply its knowledge in
other diverse contexts.
Š Growing Acceptance of AI Solutions : AI technologies can improve data processing
efficiency by standardizing the process of analyzing extensive data with different types,
quality, and sources, and are thus being widely applied across industries to help companies
reduce cost and improve efficiencies. Due to the high efficiency brought by AI
technologies in the automation of repetitive tasks and accuracy in decision making, they
are increasingly adopted such as financial investments and medical diagnostics.
Š Favorable Government Policies : Growth in demand for AI solutions is further supported
by favorable government policies. As part of its strategic mandate, the PRC central
government has implemented an AI industry development plan together with incentive
measures. For example, the Three-year Guidance for Internet Plus Artificial Intelligence
Plan (
“ʝᑌၣ+”) aims to support the development of
neural network chips to promote the adoption of AI technologies in China. The National
Guide to the Construction of a New Generation of AI Standard System (
อɓ˾ɛ
) highlights the needs for AI standards in key industries, such as
manufacturing and transportation, and envisions an initial national AI standard system
78


--- page 88 ---
INDUSTRY OVERVIEW
established within 2023. The Measures of Promoting the Innovation of and Development
of Artificial General Intelligence ()
focuses on constructing AGI capabilities, including large language models, and facilitating
the adoption of AGI capabilities in various industries such as healthcare.
Competitive Landscape
AI solution market can be categorized based on provider types, which mainly include AI
solution providers who primarily provide AI solutions based on machine learning, traditional digital
solution providers and system integrators. Among those, AI solution providers enjoy greater
advantages in technological research and development, positioning them more favorably to maintain
market competitiveness and drive business expansion. Compared with traditional digital solution
providers, AI solution providers benefit from the broad range of AI models and in-depth industry and
customer coverage, which allows for cross-domain innovation, creating more competitive and diverse
cross-industry verticals. This enables AI solution providers to easily scale the solutions and integrate
them with customers’ devices, fostering an open and rapidly growing ecosystem that further
strengthens connections with customers.
China’s AI solution market is highly fragmented. According to Frost & Sullivan, we were
ranked fourth among the AI solution providers in China in terms of revenue with a market share of
0.6% in 2024. The following table sets forth the top five AI solution providers in China in terms of
revenue in 2024:
Top Five AI Solution Providers in China by Revenue in 2024
Ranking Company Revenue Market Share
(RMB in million)
1 Company A (1) ~16,500 9.7%
2 Company B (2) ~4,000 2.3%
3 Company C (3) ~3,000 1.8%
4 Unisound 939.0 0.6%
5 Company D
(4) ~500.0 0.3%
Source: Public information, Expert interview, Frost & Sullivan analysis
Notes:
(1) Company A, founded in 1999, is an intelligent speech and AI company, covering voice support software, industry application products
and systems, information engineering and operation and maintenance services. Company A focuses on products and solutions in the
areas of AI communication, AI office, AI education and AI service, as well as fundamental research in speech and languages, natural
language comprehension, machine learning, machine reasoning, and adaptive learning. Company A was listed on the Shenzhen Stock
Exchange in 2008.
(2) Company B, established in 2014, is a leading AI company in China, focusing on key technological areas such as computer vision, natural
language processing, perceptual intelligence, decision intelligence, and AI generated content. Company B provides diverse AI products
and solutions for scenarios including daily life, business, city and auto. Company B was listed on the Hong Kong Stock Exchange in
2021.
(3) Company C is an AI company founded in 2011 in Beijing that focuses on the fields of computer vision and deep learning. Company C is
specialized in AIoT applications, and offers an AIoT product system that integrates hardware and software solutions catering to
consumer IoT, city IoT, and supply chain IoT.
(4) Company D, founded in 2015, is a Chinese AI company that focuses on providing human-machine collaborative system solutions.
Company D’s core technologies cover intelligent perception, cognition and decision-making. It provides AI products and solutions for
finance, governance, transport and commerce. Company D was listed on the Shanghai Stock Exchange in 2022.
79


--- page 89 ---
INDUSTRY OVERVIEW
AI SOLUTION MARKET BY INDUSTRY VERTICALS
Applying AI technologies including conversational AI, computer vision and data science, and
combining AI technologies such as conversational AI, computer vision and data science with industry
expertise, companies develop AI solutions in specific industry verticals, including:
Š IoT: The internet of things, or IoT, is an interrelated system consisting of sensors,
processing ability, software and other technologies to transfer data over a network without
human interference. AI Solution in artificial intelligence of things combines AI analytical
skills with data collection through IoT to enhance workflow and risk management.
Š Healthcare: AI service and solution in healthcare is mainly composed of AI in healthcare
services, AI in disease diagnosis and treatment, AI in pharmaceutical R&D and other
emerging solutions empowered by AI.
Š Other Industries : AI solutions are applied in other industries, such as finance, retail,
education, agriculture, telecom and energy.
The following graphs show the market size of AI solutions by major industry verticals:
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
AI Solution 42.2 52.4 72.1 93.7 135.5 180.4 246.7 351.3 491.5 671.3 899.3 1,174.9
15.9 20.3 34.1 47.7 57.9 69.8 91.0 116.5 145.4 180.5 206.3
5.1 7.4 9.9 14.7 20.0 28.4 41.5 60.2 86.2 120.0 161.6
6.3 9.0 11.7 16.7 21.6 28.9 39.5 53.7 70.2 90.7 114.4
1.6 2.3 3.6 5.6 9.9 16.9 29.9 48.3 73.3 105.5 146.5
23.6 33.1 34.4 50.8 71.0 102.6 149.3 212.7 296.3 402.6 546.1
Others 13.8
AI Solution in Finance 3.8
AI Solution in Consumer 4.7
AI Solution in Healthcare 1.1
AI Solution in IoT 18.8
Period
CAGR
AI Solution AI Solution
in IoT
AI Solution
in Healthcare
AI Solution
in Consumer
AI Solution
in Finance
2019-2024 33.7% 30.5% 39.0% 35.8% 54.3%
36.7% 40.5% 41.7% 32.1% 56.5%2024-2030E
Market Size of AI Solution in China, 2019-2030E
Billion RMB
Source: Public information, Expert interview, Frost & Sullivan Analysis
AI Solution in IoT in China
IoT refers to a network of physical objects that are equipped with sensors, software, and other
technologies for the purpose of connecting and exchanging data with other devices and systems over
the internet. The system sends data received from sensors to data center or the cloud for processing and
analysis and initiates automated actions accordingly.
Synthesizing AI and IoT technologies, AI Solution in IoT enhances workflow and risk
management through the collection of data from physical devices. Leveraging AI analytical capabilities,
AI Solution in IoT can be customized into various application scenarios such as remote monitoring and
quality control by reporting abnormalities based on its analysis of trends and patterns. The use of AI
Solution in IoT optimizes decision-making process, increases efficiency, and reduces operational costs.
80


--- page 90 ---
INDUSTRY OVERVIEW
AI Solutions in IoT, including one-stop AI Solutions in Daily Life, AI Solutions in
manufacturing and AI Solutions in governmental security, empower the digitalization of business and
public sectors. AI Solutions in Daily Life are of particular importance as they bring convenience to
people’s daily lives and cover a wide range of application scenarios. AI Solutions in Daily Life
encompass solutions for residential, commercial space, hospitality and transportation, with the goal of
improving consumers’ quality of life and creating smooth user experience.
Market Size and Competitive Landscape of AI Solution in Daily Life Industry
AI Solution in Daily Life is the most prominent sector in the AI Solution in IoT industry,
including areas where enterprises can enhance the convenience and quality of everyday life for
individuals following product or service adoption. As advised by Frost & Sullivan, it is not uncommon
to classify transportation, commercial space, hospitality, residential industry under Daily Life as a
segment. For instance, AI in transportation enables more kinds of interactive model, which brings more
convenience for passengers. AI Solution in Daily Life is expected to further drive the growth of AI
Solution in IoT market in the foreseeable future. AI solution providers compete with traditional digital
solution providers, such as existing AI Solution in Daily Life and cloud-based solution providers.
Different solution providers may each have unique competitive strengths in the technology
infrastructure, operating systems or downstream applications. According to Frost & Sullivan, the
market size of AI Solution in Daily Life solutions provided by AI solution providers in China increased
from RMB3.0 billion in 2019 to RMB10.5 billion in 2024, growing at a CAGR of 28.9%, and is
expected to reach RMB149.6 billion in 2030 with a CAGR of 41.0% from 2024 to 2030.
According to Frost & Sullivan, we were ranked third among the AI solution providers in
China’s AI Solution in Daily Life market in terms of revenue in 2024. The following table sets forth
the top five AI solution providers in AI Solution in Daily Life in China in terms of revenue in 2024 and
their respective market shares:
Top Five AI Solution Providers in AI Solution in Daily Life
in China by Revenue in 2024
Ranking Company Market Share
(%)
1 Company B 7.5
2 Company A 6.9
3 Unisound 5.8
4 Company C 3.9
5 Company E
(1) 1.5
Source: Public information, Expert interview, Frost & Sullivan analysis
Note:
(1) Company E, founded in 2007, is a conversational AI company in China, providing natural language interaction AI solutions that cover
scenarios including IoT, governance, auto and finance.
81


--- page 91 ---
INDUSTRY OVERVIEW
The following table shows the market outlook and competitive landscape of the verticals that
we focus on for AI solutions in Daily Life:
Industry vertical
Market Size
(RMB
Billion, 2024)
2019-2024
Historical
CAGR
2024-2030E
Forecast
CAGR
Market outlook and competitive
landscape
Transportation 14.6 54.7% 46.4%  With the rapid
urbanization and
population growth in
China, the country has
made significant
investments in its public
transportation
infrastructure in recent
years, with a focus on
integrating AI
technologies to improve
efficiency, convenience,
and accessibility.
In particular, by 2023, a
total of 53 cities in 31
provinces and Xinjiang
Production and
Construction Corps had
constructed 290 metro
lines, with an operating
length of 9,584km and
5,609 stations. The
integration of AI, big data
analytics, and IoT is
enabling metro enterprises
to gather and analyze vast
amounts of data in real
time, leading to more
informed decision-making
and proactive
maintenance strategies.
Additionally, the
emergence of autonomous
metros and intelligent
control systems is
revolutionizing the way
metros are operated and
managed, opening up new
possibilities for efficiency
and cost savings.
82


--- page 92 ---
INDUSTRY OVERVIEW
Industry vertical
Market Size
(RMB
Billion, 2024)
2019-2024
Historical
CAGR
2024-2030E
Forecast
CAGR
Market outlook and competitive
landscape
Commercial Space 16.7 40.4% 39.8%  As more people move to
urban areas and
businesses continue to
expand, the demand for
AI solutions in
commercial space is
expected to soar.
Enterprises seek to
implement solutions that
can help them optimize
energy usage, improve
security, and create more
personalized and seamless
user experiences.
Hospitality 3.2 34.7% 31.8%  AI solutions in hospitality
enable hospitality
enterprises to gather and
analyze vast amounts of
data in real time, allowing
them to deliver a more
personalized, efficient,
and secure guest
experience.
 By 2023, the total number
of lodging facilities in
China was approximately
610,000, of which
approximately 320,000
were hotel facilities. As
technology continues to
advance, these solutions
are expected to play an
increasingly pivotal role
in driving innovation and
driving growth in the
hospitality industry.
83


--- page 93 ---
INDUSTRY OVERVIEW
Industry vertical
Market Size
(RMB
Billion, 2024)
2019-2024
Historical
CAGR
2024-2030E
Forecast
CAGR
Market outlook and competitive
landscape
Residential 2.5 28.5% 35.6%  As the nation with the
largest population and a
swiftly growing middle-
class demographic, China
offers an immense and
profitable marketplace for
AI solutions in residential.
These solutions prioritize
convenience, security,
connectivity, and privacy,
and are poised to become
a vital component of
contemporary life,
providing a smooth and
customized experience for
users.
 Notice by 13 Departments
Including the Ministry of
Commerce of Several
Measures for Promoting
the Consumption of
Household Products (
ਠ
ਕ௅ഃ13࢕
 )
encourages the
interconnection of
household devices. It also
calls for the establishment
of sound standard systems
and the transition from
individual product
intelligence to whole-
house intelligence.
Growth Drivers
The AI Solution in IoT market in China is primarily driven by the following:
Š Advancement in AI Technology : The advancement of AI technology enhances the
intelligence of IoT devices, leading to increased market demand. Until 2022, rule-based
IoT systems mainly facilitated interactions between humans and objects or spaces, such as
human interactions with vehicles through specific voice commands. However, recent
developments in task-agnostic large language models, particularly large language models,
have brought significant and ongoing improvements to AI capabilities. The diverse
contextual knowledge allows these models to infer user intent from ambiguous commands
and generate context-specific responses. For instance, smart home control with LLMs
offers swift and seamless interactive experience with IoT devices, significantly reducing
user effort and improving user satisfaction.
84


--- page 94 ---
INDUSTRY OVERVIEW
Š Continued Deployment of 5G Networks : 5G networks lay the foundation for the
widespread adoption of AI capabilities on IoT devices on a larger scale. The expanding
implementation of 5G networks, leveraging their advantages of low latency, ultra-fast
speed and extensive connectivity, provides a more efficient information transmission
channel for IoT networks. 5G networks’ high data throughput optimizes the authenticity of
data transmission and recovery, significantly improving the video quality and transmission
speed within the IoT network. Hence, the continued deployment of 5G networks plays
pivotal role in driving the market growth of AI solutions in IoT.
Š Growth of Edge Computing : Driven by the widespread adoption of 5G technologies, the
growing scale and complexity of data has exceeded the capacity of the network
infrastructure capabilities, requiring fully distributed AI systems. The growth of edge
computing enables fully distributed AI services such that edge devices can process
intelligent data independently with resources closer to the user. Because the storage and
computing capabilities are no longer limited to the cloud, such independent processing
with proximate resources reduces latency and improves data privacy. The increased
processing speed benefited from proximity further reduces data communication and
storage costs, thereby facilitating the industrial application of AI solutions in IoT.
Š Favorable Government Policies : The PRC central government is promoting the
development of AI solutions in IoT by launching a series of plans and policies at the
national level. The Three-Year Action Plan for New IoT Infrastructure Development
(2021-2023) has outlined the intention to preliminarily set up new IoT infrastructure in
key domestic cities by 2023. This plan is expected to enhance the innovation and market
competitiveness of crucial technologies like AI, big data, and blockchain. It serves as a
strategic roadmap for IoT infrastructure development, pushing forward the AIoT industry,
and the digital economy industry, including AI and IoT, is expected to experience
significant GDP growth by 2025. In addition, in order to achieve sustainable urban
development, the central government will issue protocols and implementation plans for
carbon neutrality driven by AI solution in IoT technology. In June 2024, four departments
including MIIT issued the Guidelines for the Construction of a Comprehensive
Standardization System for the National Artificial Intelligence Industry (2024 Edition)
(
یܸ2024و)), which clarified the current
situation of industrial development, put forward the construction goals, expounded the
construction ideas, planned seven major standard systems, and pointed out seven key
development directions. In November 2024, three departments including NHC issued the
Reference Guidelines for Artificial Intelligence Application Scenarios in the Health and
Health Industry (
ˏ), which identified 84 “AI+”
application development scenarios in the health and health industry. In April 2025, seven
departments including MIIT issued Implementation Plan for the Digital-Intelligent
Transformation of the Pharmaceutical Industry (2025-2030) (
˙
ࣩ2025-2030ϋ)), encouraging the joint construction of a pharmaceutical industry big
data platform, the upgrading of information infrastructure, and the establishment of a
large-model innovation platform.
Future trends
Š One-stop AI Solution in IoT : The fragmented nature of IoT applications and devices,
originating from various manufacturers, presents challenges related to compatibility and
85


--- page 95 ---
INDUSTRY OVERVIEW
interconnectivity. Therefore, the development of AI Solution in IoT requires one-stop,
platform-based AI Solution in IoT to achieve effective expansion of application scenarios.
Š Heightening Protection of User Privacy : Ensuring a balance between leveraging data for
product optimization and personalization and maintaining user privacy and security is
increasingly vital for AI players. From the perspective of users, stronger protection
measures foster greater trust and recognition between the AI players and their users. To
promote user privacy, security measures including self-sovereign identities, will be
implemented. In addition, the general trend in policies and regulations calls for data
privacy in and information security of AI solutions in IoT.
Š Broader Application Scenarios : AI Solution in IoT combines the capability and
efficiency of AI and IoT, making it suitable for solving specific problems with distributed,
intelligent systems. From AI Solution in Daily Life to AI Solution in manufacturing and
retail, industries are increasingly shifting towards AI Solutions in IoT. This wider adoption
of AI Solution in IoT propels further technological development in AI Solution in IoT.
Moreover, utilizing advanced AGI technologies, the capabilities of AI Solution in IoT can
be upgraded to achieve human-machine interaction. This upgrade will gain AI Solution in
IoT broader acceptance and potentials for innovations across various application scenarios.
Š Multimodal Interaction : Multimodal interaction, encompassing voice, vision, and text,
plays a crucial role in driving growth by expanding the range of AI applications. Future
features for IoT systems will require synchronization among multiple devices to
accomplish integrated tasks, and the systems will offer multimodal interactions including
voice, visual and text to meet diversified user needs.
AI service and solution in healthcare
Opportunities in China Healthcare market
Š Significant Potentials for Digitalization and Intelligent Solutions for Class III
Hospitals: At present, China’s healthcare providers include hospitals, primary healthcare
institutions (such as community health service centers, rural health service centers and
village clinics), and other healthcare institutions. Among these providers, hospitals play
the most important role. China’s medical resources are concentrated in large Class III
hospitals, which accounted for 10.1% of total hospitals but intook 2.6 billion outpatient
visits, or 61.7% of total hospital outpatient visits in 2023, according to Frost & Sullivan.
According to the NHC, while the average time per visit amounted to 180 minutes in 2020,
only 4.4%, or 8 minutes, of which was spent on the diagnosis process. AI healthcare
solutions can improve the efficiency and quality of diagnosis and treatment. For example,
doctors assisted by medical transcription solutions spend less time in writing medical
records and more time in communicating with patients. In addition, AI in disease
diagnosis and treatment solutions can improve the efficiency of examinations. As a result,
there are significant market opportunities for AI solutions.
Š Favorable Government Policies : In 2018, the PRC government proposed the
Administrative Measures for Grading Evaluation of Application Level of Electronic
Medical Record System (Trial) (“ Measures”), stipulating the standards for different
grades of electronic medical record system and proposing specific requirements for
Class III hospitals as a basis for AI applications development. Under the Measures, all
86


--- page 96 ---
INDUSTRY OVERVIEW
Class III hospitals should upgrade their information systems to Grade 4 (defined as
supporting information sharing throughout the hospital) or above to enable information
sharing between systems and support initial decision-making. According to Frost &
Sullivan, the application of electronic medical record system in China is still at a relatively
preliminary stage, with 8.0% of hospitals participated in the grading evaluation reached
Grade 5 (defined as supporting unified data management), 1.6% of those hospitals reached
Grade 6 (defined as supporting closed-loop management of medical data during the whole
process) and 0.3% of those hospitals reached Grade 7 (defined as achieving quality control
of medical safety) in 2022. Given the low number of hospitals equipped with advanced
electronic medical record systems and the favorable government policies, there are
considerable market opportunities for companies providing AI services and solution in
healthcares.
Š Rising Insurance Expenses Driving Demand for Intelligent Expense Control
Solutions: Spending on health insurance is expected to rise, primarily driven by an
accelerating aging population and increased demand for high-quality medical services.
The revenue of basic health insurance fund has increased from RMB2,442.1 billion in
2019 to RMB3,069.8 billion in 2022, with a CAGR of 7.9%, while the expenditure has
increased from RMB2,085.4 billion in 2019 to RMB2,443.2 billion in 2022 at a CAGR of
5.4%, according to National Medical Products Administration. Given the growing revenue
and expenditure, efficient expense control solutions are needed to standardize treatment
patterns, ensure compliance and prevent insurance fraud.
AI Service and Solution in Healthcare
AI service and solution in healthcare mainly include (i) AI in healthcare service and treatment,
which involves (a) AI in healthcare service and (b) AI in disease diagnosis and treatment, (ii) AI in
pharmaceutical R&D solutions, and (iii) other emerging solutions empowered by AI. Specifically, AI in
healthcare service is one of the major areas with the potential in optimizing healthcare procedures,
enhancing the quality of diagnosis and treatment, and ensuring efficient hospital management.
Š AI in Healthcare Service : AI applications streamline and optimize healthcare services
with functions such as medical procedure optimization, medical record sharing and quality
management, and medical insurance fund management.
O AI solution in Medical Record Transcription : AI solution in Medical Record
Transcription automatically generates electronic medical records based on AI
technologies, voice dictation and NLP to simplify the medical record input process
for healthcare professionals.
O AI solution in Medical Quality Management : AI solution in Medical Quality
Management can be seamlessly embedded in the workflow of healthcare services,
improving the clinical efficiency through the review of the medical records via
knowledge graph and NLP.
O AI solution in Medical Insurance Payment Management : AI solution in Medical
Insurance Payment Management reviews and analyzes the cover page of medical record
and expenses to support diagnosis, treatment compliance and payment compliance.
87


--- page 97 ---
INDUSTRY OVERVIEW
Š AI in Disease Diagnosis and Treatment : AI in diagnosis and treatment cover the process
from diagnosis and treatment to patient follow-up. Such solutions include clinical decision
support system, chronic disease management and AI medical imaging.
Š AI in Pharmaceutical R&D : Pharmaceutical R&D AI models are built on specific
research data and information provided by pharmaceutical companies on biological targets
and are used to screen drug candidates and predict pharmaceutical reactions.
Market Size and Competitive Landscape
The market size of AI service and solution in healthcare in China increased from RMB1.1 billion in
2019 to RMB9.9 billion in 2024, with a CAGR of 54.3%. In 2028, AI service and solution in healthcare
market in China is expected to reach RMB146.5 billion with a CAGR of 56.6% from 2024 to 2030,
according to Frost & Sullivan. In particular, the market size of AI in healthcare service and treatment in
China increased from RMB1.1 billion in 2019 to RMB9.5 billion in 2024, with a CAGR of 55.0%. AI in
healthcare service and treatment market is expected to reach RMB138.2 billion with a CAGR of 56.3% from
2024 to 2030. The market size of AI in healthcare service and treatment solution providers with machine
learning capabilities in China increased from RMB0.2 billion in 2019 to RMB6.0 billion in 2024 at a CAGR
of 90.7%, and is expected to reach RMB113.0 billion in 2030 with a CAGR of 63.2% from 2024 to 2030.
AI Service and Solution in Healthcare
AI in Pharmaceutical R&D
AI in Healthcare Service and Treatment
Others
2019
1.1
0.1
1.1
-
2020
1.6
0.1
1.5
-
2021
2.3
0.2
2.2
-
2022
3.6
0.2
3.4
-
2023
5.6
0.3
5.3
0.0
2024
9.9
0.4
9.5
0.1
2025E
16.9
0.5
16.2
0.2
2026E
29.9
0.8
28.7
0.4
2027E
48.3
1.1
46.3
0.9
2028E
73.3
1.7
69.9
1.7
2029E
105.5
2.4
100.1
3.1
2030E
146.5
3.3
138.2
5.0
1.1 1.6 2.3 3.6 5.6 9.9 16.9
29.9
48.3
73.3
105.5
146.5
Market Size of AI Service and Solution in Healthcare in
China, 2019-2030E
Billion RMB
Period
CAGR
AI Service and
Solution in
Healthcare
AI in Healthcare
Service and
treatment
AI in Pharmaceutical
R&D
2019-2024
2024-2030E
54.3%
56.6%
55.0%
56.3%
38.4%
42.4%
Source: Public information, Expert interview, Frost & Sullivan Analysis
AI in healthcare service and treatment providers have the potential to leverage their
technological capabilities and medical expertise to achieve breakthroughs in the depth and
extensiveness of the healthcare knowledge graph which is the underlying technology for all practice
areas under AI service and solution in healthcare. This underpins their ability to continually develop
and innovate AI in healthcare service and treatment solutions.
88


--- page 98 ---
INDUSTRY OVERVIEW
According to Frost & Sullivan, we were ranked fourth in China’s AI in healthcare service and
treatment market in terms of revenue in 2024. The following table sets forth the top five AI solution
providers in AI in healthcare service and treatment in China in terms of revenue in 2024 and their
respective market shares:
Top Five AI Solution Providers in AI in healthcare service and treatment
in China by Revenue in 2024
Ranking Company Market Share
(%)
1 Company F (1) 5.1
2 Company G (2) 4.5
3 Company B 4.3
4 Unisound 2.1
5 Company H
(3) 1.7
Source: Public information, Expert interview, Frost & Sullivan analysis
Notes:
(1) Company F’s parent company is a leading AI company in Asia with strong Internet foundation. Company F, established in 2018, is an AI
medical brand driven by AI cloud platform, which focuses on a wide range of products and solutions for in-hospital and out-of-hospital
scenarios, including CDSS, AI retinal imaging, chronic disease management, medical data service and pre-diagnosis assistant.
(2) Company G was founded in 2016 and belongs to a group which has over 20 years of experience in AI technology. Company G leverages
nature language processing, computer vision and other core technologies to provide smart diagnosis and treatment solution, primarily
including CDSS and AI imaging products.
(3) Company H, founded in 2011 in Shanghai, develops and manufactures advanced medical imaging equipment, committed to providing
global customers with a full range of independently developed high-performance medical imaging diagnostic and treatment equipment,
life science instruments, and innovative solutions covering the entire chain of “basic research-clinical research-medical transformation.
Growth Drivers
Growth drivers for AI service and solution in healthcare in China mainly include the following:
Š The Growing Demand for AI service and solution in healthcare : The healthcare system
in China faces challenges due to inadequate and uneven distribution of medical resources,
requiring support to ensure the financial sustainability of public healthcare funds.
According to National Bureau of Statistics, there were 3.40 doctors per 1,000 population
in average in China in 2023. Meanwhile, 3,855 Class III hospitals, which accounted for
10.1% of total hospitals, intook 2.6 billion hospital outpatient visits, or 61.7% of total
outpatient visits in 2023. Consequently, there is a significant demand for AI service and
solution in healthcare that can improve efficiency, facilitate better information sharing and
reduce overall healthcare expenditure.
Š Advancement in AI Technologies : Recent advances in large language model research
have the potential to disrupt the traditional approach of task-specific medical AI models
that have been supporting AI services and solutions in healthcare until 2022. Progress in
large-scale foundational model research enables medical models to remain useful in
novel situations and adjust to newly emerged diseases and technologies with few-shot
finetuning. In addition to the continuous and rapid iteration, by combining large
language models with industry specific knowledge enhancements, the new AI services
and solutions in healthcare are able to offer high-quality multimodal outputs that
enhance the decision-making process, improve patient experiences and ultimately drive
market growth of AI service and solution in healthcare industry in China.
89


--- page 99 ---
INDUSTRY OVERVIEW
Š Favorable Government Policies : The PRC government has been actively promoting the
digital transformation of its healthcare system. In 2018, Administrative Measures for
Grading Evaluation of Application Level of Electronic Medical Record System (Trial) (

༊Б) established standards for different
grades of electronic medical record system and specific digitalization requirements. In
2021, the National Health Security Administration introduced a Three-Year Action Plan
for Payment Reform. The plan aims to implement payment systems such as diagnosis-
related group and diagnosis-intervention packet in hospitals covered by state health
insurance by 2025, with the goal of controlling medical costs. These initiatives further
drive the digitalization of healthcare services and encourage the adoption of AI-powered
solutions for cost and quality management.
Š Development of Hospital Information System : With favorable policies and the
increasing need for digitalization in hospitals, the quality of medical data and information,
such as electronic medical records, is expected to further improve. As computing power
increases, the more standardized and structured medical data can be used as large datasets
to train AI medical algorithms, which can greatly improve the accuracy of medical AI
models and gain user acceptance. Therefore, the development of medical databases is
expected to drive further growth in AI services and solutions in healthcare.
Future trends
Š Enhanced Healthcare Data Security : As AI technology is more prevalent in healthcare
settings, the need for data security and privacy has become more important. The multi-
disciplinary industry standards and regulations on responsible AI implementation further
reflects such need. To ensure data security and compliance with industry standards and
regulations, measures such as strict access controls, multi-factor authentication, endpoint
security measures and abnormality detection technologies are expected to be increasingly
implemented.
Š Growing Penetration of AI Services and Solutions in Healthcare : AI services and
solutions in healthcare are predicted to be more widely implemented as they continue to
develop and gain popularity in the coming years. Although the commercialization of AI
services and solutions in healthcare is still at an early stage, certain innovative solutions
such as clinical decision support systems have already been extensively deployed. The
effective implementation of these solutions is an important factor in promoting user
acceptance of AI services and solutions in healthcare, paving the way for wider adoption
by governments. In the coming years, there will be wider implementation of AI services
and solutions in healthcare as they continue to evolve and become more popular.
Š Uniform Standards: As the field of AI services and solutions in healthcare evolve, new
technologies introduce new obstacles. For instance, there is a lack of common standards
among medical institutions that operate in different regions. It is therefore necessary to
improve data integrity and enhance the exchange of information. In the future, the PRC
central government will issue systematic protocols and guidance to regulate market practices
to setting unified standards. This standardization effort aims to improve compatibility among
devices and platforms, ultimately enhancing data quality and AI solutions.
Š Knowledge- and Language-based Models Applications : The COVID-19 pandemic has
led to increasing interest in medical imaging as a field, which became one of the most
90


--- page 100 ---
INDUSTRY OVERVIEW
commercialized AI application in the healthcare industry. Meanwhile, recent technology
advances in LLMs have proven especially effective in improving the capabilities of
knowledge- and language-based models in healthcare. Utilizing LLMs and with the aid of
AI-empowered medical inference, AI solutions in healthcare can operate as independent,
autonomous practitioners with the knowledge and skills to participate in various medical
scenarios, particularly in healthcare services. As a result, knowledge- and language-based
AI solutions in healthcare are expected to be the primary driver of growth in the AI
services and solutions in healthcare market in the coming years.
Entry Barriers
Š Talent: AI services and solutions in healthcare require multi-disciplinary talents, who
possess expertise in various domains such as medicine, healthcare services, technology,
and public policy. However, due to a substantial shortage of such talents, these skilled
individuals are typically single-disciplinary talents who acquire multi-disciplinary
knowledge through on-the-job training. New entrants may face challenges in acquiring
talents with multi-disciplinary knowledge.
Š Data and Technologies : One of the biggest technology barriers of AI services and
solutions in healthcare is a lack of proper data infrastructures. Products, such as medical
transcription solutions, rely on an accurate and complete base of medical knowledge
graph. Currently, most of the AI products in the market leverage clinical practice
guidelines for AI training inputs, yet medical science is also an empirical discipline
requiring accumulated experience. The accumulation of standardized medical knowledge
graph is difficult to achieve in a short term by new entrants.
Š Capital: In order to increase core competitiveness, providers of AI services and solutions
in healthcare may need to invest a large amount of capital in production, R&D, brand
promotion, channel construction and commercialization. Since some AI services and
solutions in healthcare require a long development period due to a strict need for data
accumulation, new entrants typically have less financial resource.
Š Hospital Engagement: Expanding the integration of AI service and solution in healthcare
in healthcare institutions can be challenging due to system variations across institutions
and patient populations’ different preferences. It can therefore be challenging for market
entrants to scale up the products and solutions and implement them in a cost-efficient
manner. Commercialization success of AI services and solutions in healthcare depends on
the ability to establish stable, highly-engaging partnership with healthcare institutions and
local authorities. In the early stage of collaborations, most of them prefer add-on functions
that can be easily integrated with the existing systems, rather than replacing existing
systems.
SOURCE OF INFORMATION
In connection with the Global Offering, we have engaged Frost & Sullivan to conduct a detailed
analysis and prepare an industry report on the markets in which we operate. Services provided by Frost &
Sullivan include market assessments, competitive benchmarking, and strategic and market planning for a
variety of industries. We have agreed to a total of RMB1,641,509 (excluding value added tax) in fees and
expenses for the preparation and use of the Frost & Sullivan Report. The payment of such amount was
not contingent upon our successful Listing or on the results of the Frost & Sullivan Report. Except for the
91


--- page 101 ---
INDUSTRY OVERVIEW
Frost & Sullivan Report, we did not commission any other industry report in connection with the Global
Offering.
We have extracted certain information from the Frost & Sullivan Report in this section, as well
as in the sections headed “Summary,” “Risk Factors,” “Business,” “Financial Information” and
elsewhere in this prospectus to provide our potential investors with a more comprehensive presentation
of the industries in which we operate. Unless otherwise noted, all of the data and forecasts contained in
this section are derived from the Frost & Sullivan Report, various official government publications and
other publications. During the preparation of the market research report, Frost & Sullivan performed
both (i) primary research, which involved in-depth interviews with leading industry participants and
industry experts; and (ii) secondary research, which involved review of company reports, independent
research reports and data based on Frost & Sullivan’s own research database. Projected data was
obtained from historical data analysis plotted against macroeconomic data with reference to specific
industry-related factors. Frost & Sullivan believes that the basic assumptions used in preparing the
Frost & Sullivan Report, including those used to make future projections, are factual, correct and not
misleading. Frost & Sullivan has independently analyzed the information, but the accuracy of the
conclusions of its review largely relies on the accuracy of the information collected. Frost & Sullivan
research may be affected by the accuracy of these assumptions and the choice of these primary and
secondary sources. Our Directors confirm that, to the best of their knowledge, after making reasonable
inquiries and exercising reasonable care, there is no material adverse change in the market information
since the date of the relevant data contained in the Frost & Sullivan Report which may qualify,
contradict or have an impact on the information in this section.
92


--- page 102 ---
REGULATORY OVERVIEW
The following is a brief summary of the laws and regulations in the PRC that currently
materially affect our Group and our operations. The principal objective of this summary is to
provide potential investors with an overview of the key laws and regulations applicable to us.
This summary does not purport to be a comprehensive description of all the laws and regulations
applicable to the business and operations of our Group and/or which may be important to
potential investors. Investors should note that the following summary is based on laws and
regulations in force as at the date of this document, which may be subject to change.
This section sets out summaries of certain aspects of PRC laws and regulations, which are
relevant to our business operations.
REGULATIONS AND POLICIES ON ARTIFICIAL INTELLIGENCE TECHNOLOGIES
The rapid growth of China’s AI market is driven by multiple favorable factors, including
government policies. On May 8, 2015, the State Council issued the notice on promulgating Made in
China 2025 Plan (
ʕ਷Ⴁி2025). Made in China 2025 Plan emphasizes the acceleration of the
promotion of integrated development of new generation information technology and manufacturing
technology, and regards intelligent manufacturing as the main direction of comprehensive integration
of informatization and industrialization. Meanwhile, it is underlined that efforts should be made to
develop intelligent equipment and intelligent products, promote intelligent production process,
cultivate new production methods, and comprehensively enhance the intelligent level of research and
development, production, management and service of enterprises.
On July 8, 2017, the State Council issued the Circular on the Development Planning of the New
Generation of Artificial Intelligence (
). The circular
provides three strategic steps in developing a new generation of artificial intelligence technology, and
set goals to have China’s artificial intelligence technology reach leading level in the world and become
one of the major artificial intelligence innovation centers in the world. On November 8, 2018, the
Ministry of Industry and Information Technology (the “ MIIT”) issued the Plan for Key Tasks in a
New Generation of AI Innovation (
) and
encouraged to select a batch of innovated companies that own key technologies based on artificial
intelligence, and have them collectively focus on enhancing products, platforms, and services with
advanced technologies and excellent performance.
The Guidelines for the Construction of National Open Innovation Platforms for the New
Generation Artificial Intelligence (
ˏ), promulgated
by the Ministry of Science and Technology on August 1, 2019 and came into effect on the same date,
provides that “open and sharing” shall be the important philosophy in promoting artificial intelligence
innovation and industry development in China, and encouraged to open innovation platforms for
companies to do testing, and thus to form standard and modularized models, middleware and
applications for providing services to the public in the form of open interfaces, model libraries,
algorithm packages, etc. The Guidelines for the Construction of the National New Generation Artificial
Intelligence Innovation and Development Pilot Zone (
ணʈЪ
ˏ), promulgated by the Ministry of Science and Technology on August 29, 2019, as amended on
September 29, 2020 and effective on the same date, underlines that an environment conducive to the
innovation and development of artificial intelligence shall be created, as well as to promote the
construction of artificial intelligence infrastructure and strengthen the conditional support for the
innovation and development of artificial intelligence.
93


--- page 103 ---
REGULATORY OVERVIEW
The Outline of the 14th Five-Year Plan for National Economic and Social Development of the
PRC and Outlines of Objectives in Perspective of the Year 2035 (ึ೯
ʞϋ஝ྌձ2035), approved by the National People’s Congress (the
“NPC”) on March 11, 2021, sets out the focus of key areas include high-end chips, operating systems,
key artificial intelligence algorithms and sensors, and the PRC shall speed up research and
development in basic theories, basic algorithms, and equipment materials and make breakthroughs in
such area.
On July 29, 2022, the Ministry of Science and Technology and other five relevant
governmental authorities jointly promulgated the Guiding Opinions on Accelerating Scene Innovation
to Promote High-quality Economic Development through High-level Application of Artificial
Intelligence (
ኬจԈ), which
proposes to encourage in-depth exploration of artificial intelligence technology application scenarios in
key industries.
On July 10, 2023, the CAC issued the Interim Measures for the Administration of Generative
Artificial Intelligence Services (
) (the “Measures on Generative
AI Services”). The Measures on Generative AI Services defines the generative artificial intelligence as
the models and technology to generate such contents as texts, pictures, sound, videos. The Measures on
Generative AI Services requires generative AI service providers to take effective measures to enhance
the accuracy and reliability of the content created by the generative artificial intelligence. Pursuant to
the Measures on Generative AI Services, generative AI service providers shall (a) assume the
responsibilities of content producers and perform network information security obligations; (b) assume
the responsibilities of processors of personal information to protect personal information; and (c)
process training data such as conducting pre-training and optimization training in accordance with the
laws and regulations, including, among others, (i) the training shall use data and models from lawful
sources; (ii) if intellectual properties are involved, it shall not contain any contents that infringe upon
the intellectual property rights of other parties; (iii) if such data contains personal information, the
providers shall obtain consent of personal information subjects or comply with relevant laws and
regulations; and (iv) take effective measures to improve the quality of training data and enhance the
quality, authenticity, objectivity and diversity of training data. In addition, the service providers that
provide generative artificial intelligence services with public opinion attribute or social mobilization
ability are required to apply for security assessment with the national cybersecurity administration
authorities in accordance with the Provisions on the Security Assessment of Internet Information
Services with Public Opinion Attribute or Social Mobilization Ability (
ঐɢ
) and complete the filing formalities of algorithms in accordance with
the Provisions on the Administration of Algorithm Recommendation for Internet Information Services
(
).
Our use of UniGPT is subject to the Measures on Generative AI Services and the Measures on
Generative AI Services may also capture our Daily Life and Healthcare products. As of the Latest
Practicable Date, we have adopted a series of measures to comply with the Measures on Generative AI
Services, including but not limited to (i) conducting content vetting, including manual and machine
review of the input data and generated or synthesized results of users and timely dispose the illegal and
harmful information in these data and results; (ii) implementing internal rules and procedures with
respect to algorithm security assessment and management; (iii) providing channels for complaints and
reports of illegal information; (iv) engaging an algorithm security officer to coordinate algorithm
94


--- page 104 ---
REGULATORY OVERVIEW
governance work; and (v) completing the algorithm filing for our products and solutions with relevant
PRC authorities and the security assessment for our products and solutions in accordance with the
Measures on Generative AI Services. In addition, during the Track Record Period and as of the Latest
Practicable Date, we have not been involved in any investigations on cybersecurity review by the
CAC, nor have we received any regulatory inquiries, notice, warnings, sanctions or penalties in
relation to cybersecurity and data protections regulations.
Based on the foregoing, our PRC legal advisor as to data security law and Directors are of the
view that, during the Track Record Period and up to the Latest Practicable Date, we are in compliance
with the Measures on Generative AI Services and relevant regulations on the management of
generative AI services in all material aspects. Our Directors are of the view that the aforementioned
regulations would not have a material our adverse impact on us. Having considered the views and basis
of our Directors and our PRC legal advisor as to data security law, based on the due diligence
conducted by the Joint Sponsors, nothing else has come to the attention of the Joint Sponsors as non-
legal expert that would reasonably cause them to cast doubt on the reasonableness of the above views
of our Directors and our PRC legal advisor as to data security law in any material aspect.
REGULATIONS ON CYBER SECURITY AND DATA PROTECTION
The PRC government has enacted laws and regulations with respect to internet information
security and protection of personal information from any abuse or unauthorized disclosure. Internet
information in the PRC is regulated and restricted from a national security standpoint. The Standing
Committee of the National People’s Congress (the “ SCNPC”) enacted the Decision on the
Maintenance of Cybersecurity (
) on December 28, 2000, as amended on
August 27, 2009, stipulates, among others, that the following activities conducted via internet are
subject to criminal penalty if they constitute crimes under PRC law: (i) hacking into a computer or
system of strategic importance; (ii) intentionally inventing and spreading destructive programs such as
computer viruses to attack computer systems and communications networks, thus damaging computer
systems and the communications networks; (iii) disconnecting computer networks or communications
services without authorization in violation of laws and regulations; (iv) divulging state secrets;
(v) spreading false commercial information; or (vi) infringing intellectual property rights via internet.
In addition, on December 16, 1997, the Ministry of Public Security (the “ MPS”) issued the
Administration Measures on the Security Protection of Computer Information Network with
International Connections (
), which took effect on
December 30, 1997 and were amended by the State Council on January 8, 2011, prohibits using the
internet in ways which, among others, result in a leakage of state secrets or a spread of socially
destabilizing content. The MPS has supervision and inspection powers in this regard, and relevant local
security bureaus may also have jurisdiction. If an internet information service provider violates any of
these measures, competent authorities may revoke its operating license and shut down its websites.
The Provisions on Technological Measures for Cybersecurity Protection (ᚐҦஔ
) promulgated on December 13, 2005 by the MPS and became effective on March 1, 2006,
requires internet service providers and organizations that use interconnection services to implement
technical measures for cybersecurity protection from any threat to network security, such as computer
viruses, cyberspace invasion, attacks or destruction. All internet access service providers are required to
take measures to keep a record of and preserve user registration information. In addition, the Decision
on Strengthening Network Information Protection (
), promulgated by
95


--- page 105 ---
REGULATORY OVERVIEW
the SCNPC and took effect on December 28, 2012, emphasizes the need to protect electronic
information that contains individual identification information and other private data. This decision
requires internet information services providers and other enterprises, public institutions to publish
policies regarding the collection and use of personal electronic information and to take necessary
measures to ensure information security and to prevent any information leak, damage or loss.
The Administrative Measures for the Graded Protection of Information Security (τΌഃ
) that was issued and took effect on June 22, 2007 requires the entities that operate
and use information systems to fulfill the obligation of protection the information system at multi-
level. The entities that operate the information systems at Grade II or above shall, within 30 days since
the date when its security protection grade is determined, handle the record-filing procedures at the
local public security authority.
The PRC Cyber Security Law (
) (the “ Cyber Security Law ”),
which was promulgated in November 7, 2016 and took into effect on June 1, 2017, requires network
operators, including internet information services providers among others, to adopt technical measures
and other necessary measures in accordance with applicable laws and regulations as well as
compulsory national and industrial standards to safeguard the safety and stability of network
operations, effectively respond to network security incidents, prevent illegal and criminal activities,
and maintain the integrity, confidentiality and availability of network data. The Cyber Security Law
reaffirms the basic principles and requirements specified in other existing laws and regulations on
personal data protection, such as the requirements on the collection, use, processing, storage, and
disclosure of personal data, and internet information services providers being required to take technical
and other necessary measures to ensure the security of the personal information they have collected
and prevent the personal information from being divulged, damaged, or lost. Any violation of the
Cyber Security Law may subject an internet information services provider to warnings, fines,
confiscation of illegal gains, revocation of licenses, cancelation of filings, shutdown of websites, or
criminal liabilities.
On September 14, 2022, the Cyberspace Administration of China (the “ CAC”) released the
Notice on Seeking Public Comments on the Decision on Amending the Cyber Security Law of the
PRC (Draft for Comments) (
ᅄӋจԈᇃ),
which imposes more stringent legal liabilities and raises the upper limit of monetary fines for serious
violation of the security protection obligations of network operation, network information, critical
information infrastructure and personal information under the Cyber Security Law to RMB50 million
or 5% of the company’s total sales from the previous year.
The PRC Data Security Law (
) (the “ Data Security Law ”) was
promulgated on June 10, 2021 and became effective on September 1, 2021. It establishes a data
protection system based on the category and security level of the data in terms of its importance for
economic and social development and the potential harm caused by illegal use of such data to national
security, public interest or rights and interests of individuals and organizations. Competent
governmental authorities shall be responsible to formulate lists for “key data”. Higher level of
protection shall apply to “national core data” which refers to data that are vital to national security,
economy, people’s livelihood and major public interests. According to the Data Security Law, data
activities affecting or likely to affect national security will be subject to national security review under
the data security review system. The data relating to safeguarding national security and interests and
96


--- page 106 ---
REGULATORY OVERVIEW
performance of international obligations shall be subject to export control of China. In addition, the
Data Security Law provides that key data processors shall appoint a data security officer and establish
a management department to take charge of data security, and such processors shall evaluate the risk of
their data activities periodically and file assessment reports with the relevant regulatory authorities.
Furthermore, data transaction intermediary service providers shall check the sources of the data, the
identities of parties involved in the data transactions and keep records accordingly. Violation of Data
Security Law may subject the relevant entities or individuals to warning, fines, suspension of business
for rectification, revocation of permits or business licenses, and/or even criminal liabilities. According
to the Data Security Law, the maximum monetary fine imposed on the breaching party is RMB
10 million.
Pursuant to the Measures for Cybersecurity Review (2020 Version) (
ج
2020) promulgated by the CAC and certain other PRC regulatory authorities in April 2020,
which took effect in June 2020, the purchase of network products and services by critical information
infrastructure operator, which affect or may affect national security, shall be subject to cybersecurity
review. On December 28, 2021, the CAC published the Cybersecurity Review Measures (2021
Version) (
2021) (the “ Cybersecurity Review Measures ”), which became
effective on February 15, 2022 and replaced the Measures for Cybersecurity Review (2020 Version).
Pursuant to the enacted Cybersecurity Review Measures, the purchase of network products and
services by critical information infrastructure operator and the data processing activities carried out by
online platform operators, which affect or may affect national security, shall be subject to cybersecurity
review. According to the Cybersecurity Review Measures, before purchasing any network products or
services, a critical information infrastructure operator should assess potential national security risks
that may arise from the launch or use of such products or services, and apply for a cybersecurity review
with the cybersecurity review office of CAC if national security will or may be affected. In addition,
network platform operators who possess personal information of more than one million users and
intend to be listed at a foreign stock exchange shall declare to the cybersecurity review office of CAC
for cybersecurity review. Our PRC Legal Advisor are of the view that the term of “listing on a foreign
stock exchange (
਷̮ɪ̹)” under the Cybersecurity Review Measures exempts our listing in Hong
Kong from the mandatory obligation of ex-ante declaration of cybersecurity review. The Cybersecurity
Review Measures also provides that the governmental authorities have the discretion to initiate a
cybersecurity review on any data processing activity if they deem such activity affects or may affect
national security. During the Track Record Period and as of the Latest Practicable Date, we had not
been involved in any investigations on cybersecurity review by the CAC.
The Cybersecurity Review Measures further elaborate the factors to be considered when
assessing the national security risks of the relevant activities, including, among others: (i) the risk of any
critical information infrastructure being illegally controlled, interfered, or sabotaged; (ii) the harm to the
business continuity of any critical information infrastructure caused by the disruption of supply of these
products and services; (iii) the security, openness, transparency, and variety of sources of these products
or services, the reliability of supply channels, and risks of supply interruptions due to factors such as
politics, diplomacy, trade or other factors; (iv) the level of compliance with PRC laws and regulations of
the product and service providers; (v) the risk of theft, disclosure, damage, illegal use or cross-border
transfer of core data, important data or large amounts of personal information; (vi) the risk of influence,
control or malicious use of critical information infrastructure, core data, important data or large amounts
of personal information by foreign governments after overseas listing; and (vii) other factors that may
adversely affect the security of critical information infrastructures, cybersecurity, or data security.
97


--- page 107 ---
REGULATORY OVERVIEW
If the cybersecurity review office of CAC deems it necessary to conduct a cybersecurity
review, it should complete a preliminary review (including reaching a suggestion for the review
conclusion and sending the suggestion to the implementing body for the cybersecurity review
mechanism and the relevant authorities for their comments) within 30 business days from the issuance
of a written notice to the operator, or 45 business days for complicated cases. Upon the receipt of a
review conclusion suggestion, the implementing body for the cybersecurity review mechanism and the
relevant authorities for their comments should issue a written reply within 15 business days. If the
cybersecurity review office of CAC and these authorities reach a consensus, the cybersecurity review
office of CAC should inform the operator in writing; otherwise, the case will go through a special
review procedure. The special review procedure should be completed within 90 business days, or
longer for complicated cases.
On July 30, 2021, the State Council promulgated the Regulations on Protection of Critical
Information Infrastructure (
ᚐૢԷ), which took effect on September 1,
2021, pursuant to which, critical information infrastructures refers to critical network facilities and
information systems involved in important industries and sectors, such as public communication,
information services, energy, transportation, water conservancy, finance, public services, governmental
digital services, science and technology related to national defense industry, as well as other important
network facilities and information systems which, in case of destruction, loss of function or leak of
data, may result in serious damage to national security, the national economy and the people’s
livelihood and public interests. Pursuant to the Regulations on Protection of Critical Information
Infrastructure, the relevant governmental authorities are responsible for stipulating rules for the
identification of critical information infrastructures with reference to several factors set forth in the
regulations, and further identify the critical information infrastructure operators in the related industries
in accordance with such rules. The relevant authorities should also notify operators identified as the
critical information infrastructure operators. In addition, the Regulations on Protection of Critical
Information Infrastructure provide specific requirements for the responsibilities and obligations of the
operator: (i) the operator shall establish and improve the cyber security protection system and
responsibility system, and ensure the input of manpower, financial and material resources; (ii) the
operator shall set up a special security management department, and review the security background of
the person in charge of the special security management department and the personnel in key positions;
(iii) the operator shall guarantee the operation funds of the special security management department,
allocate corresponding personnel, and have the personnel of the special security management
department participate in the decision-making relating to cyber security and informatization; (iv) the
operators shall give priority to the purchase of safe and reliable network products and services;
network products and services procured that may affect the national security shall be subject to the
security review in accordance with the national provisions on network security. The Regulations on
Protection of Critical Information Infrastructure clarify the measures for dealing with the failure of key
information infrastructure operators to perform their responsibilities for security protection, such as
imposing fines. However, as of the Latest Practicable Date, the exact scope of “critical information
infrastructure operators” under the current regulatory regime remains unclear and the identification of
critical information infrastructure operators is subject to specific identification rules stipulated by
relevant industry regulators and the notice from the relevant regulators pursuant to the Regulations on
Protection of Critical Information Infrastructure.
On September 30, 2024, the State Council published the Data Security Regulations (
ၣഖᅰኽ
τΌ၍ଣૢԷ), which became effective on January 1, 2025. The Data Security Regulations provides
98


--- page 108 ---
REGULATORY OVERVIEW
that network data processors conduct network data processing activities that affects or may possibly
affect national security must conduct national security review in accordance with relevant laws and
regulations. It also imposes specific requirements for network data processors that process important
data. The Data Security Regulations define “important data” as “data in specific fields, specific groups,
specific regions or reaching certain accuracy and scale, which if tampered with, destroyed, leaked or
illegally obtained or used may directly endanger national security, economic operation, social stability,
public health and safety.” The Data Security Regulations calls for the national data security
coordination mechanism to coordinate with relevant authorities to issue catalogs of “important data” in
relevant regions and sectors. Network data processors must identify and report the “important data”
processed by them to relevant authorities, who are required to notify the network data processors or
publish the results to the public in a timely manner. The Data Security Regulations imposes several
compliance obligations on network data processors that process important data, including but not
limited to, (i) appoint a network data security officer and establish an internal data security
management organization; (ii) conduct a risk assessment before sharing, entrusting vendors for
processing or jointly processing of important data, unless the above processing activities are necessary
for fulfilling legal duties or obligations; (iii) report the important data disposition plan (including the
name and contact information of the recipient of the important data to competent authorities at the
provincial level before a merger, division, dissolution, or bankruptcy that could materially affect the
security of important data; and (iv) conduct an annual risk assessment of network data processing
activities and submit a risk assessment report to the relevant authorities at the provincial level which
will then share the report with the provincial branch of the CAC and the public security authority.
As of the Latest Practicable Date, we had not been involved in any investigations on
cybersecurity review by the CAC, nor had we received any regulatory inquiries, notice, warnings,
sanctions or penalties in relation to cybersecurity and data protections regulations. Our Directors and
PRC Legal Advisors are of the view that, during the Track Record Period and up to the Latest
Practicable Date, we had been in compliance with applicable laws and regulations on cybersecurity and
data security in all material respects in the PRC. In addition, our Directors are of the view that the
aforementioned laws and regulations did not and will not materially affect our Group’s operations and
financial performance. Based on the independent due diligence conducted by the Joint Sponsors and
having considered the views and basis of our Directors and our PRC legal advisor as to data security
law as disclosed in this prospectus, nothing has come to the attention of the Joint Sponsors that would
reasonably cause the Joint Sponsors to cast doubt on the reasonableness of the views of our Directors
and our PRC legal advisor as to data security law in any material aspect.
On July 7, 2022, the CAC issued the Measures for the Security Assessment of Cross-border
Transfer of Data (
), which became effective on September 1, 2022. These
measures require the data processor providing data overseas to apply for the security assessment of cross-
border transfer of data with the local provincial-level counterparts of the national cybersecurity authority
under any of the following circumstances: (i) where the data processor intends to provide important data
overseas; (ii) where a critical information infrastructure operator and a data processor who has processed
personal information of more than 1,000,000 individuals intends to provide personal information
overseas; (iii) where a data processor who has provided personal information of 100,000 individuals or
sensitive personal information of 10,000 individuals to overseas recipients, in each case as calculated
cumulatively, since January 1 of the last year intends to provide personal information overseas; or
(iv) other circumstances where the security assessment of data cross-border transfer is required as
prescribed by the CAC. Furthermore, the data processor shall conduct a self-assessment on the risk of
99


--- page 109 ---
REGULATORY OVERVIEW
data cross-border transfer prior to applying for the foregoing security assessment, under which the data
processor shall consider certain factors including, among other things, (i) the purpose, scope and
manner of the cross-border data transfer and the overseas data recipient processing data and the
legality, legitimacy and necessity thereof, (ii) the scale, scope, type and sensitivity of the transferred
data, the risks to national security, public interests and the legitimate rights and interests of individuals
or organizations arising from the cross-border data transfer, (iii) the overseas data recipient’s
commitment to assume responsibility and obligations, the management and technical measures to
fulfill the responsibilities and obligations, and the ability to ensure the security of the transferred data,
(iv) the risk of data being tampered with, destroyed, leaked, lost, transferred, or illegally obtained or
illegally used during and after the cross-border transfer, and the existence of channels for safeguarding
the rights and interests of personal information, and (v) adequate compliance of data transfer-related
contracts or other legally binding documents between the data processor and the overseas recipient
with the data security protection responsibilities and obligations. The data processors that in violation
of such measures are required to rectify such non-compliance within 6 months of the effectiveness date
thereof.
On March 22, 2024, the CAC released the Provisions on Promoting and Regulating
Cross-border Data Flows (
), which came into effect on the same day.
Such provisions specify the situations in which the declaration for the security assessment, the
conclusion of the standard contract, and the personal information protection certification are not
required. For example, the following circumstances are not subject to a data export security
assessment, entering into a standard contract for the export of personal information, or passing the
personal information protection certification: (i) the establishment and performance of a contract with
data subjects, such as cross-border shopping, cross-border delivery, cross-border remittance, cross-
border payment, cross-border account opening, air ticket and hotel reservation, visa handling and
examination services; (ii) where employee personal information must be provided overseas in
conjunction with a collective contract and with the implementation of human resources management;
(iii) to protect the life, health, and safety of natural persons in an emergency; and (iv) where a data
handler other than a critical information infrastructure operator provides abroad the personal
information (excluding sensitive personal information) of not more than 100,000 persons
accumulatively as of January 1 of the current year. However, to provide personal information abroad, a
data handler shall, in accordance with laws and administrative regulations, perform obligations such as
notification, obtaining individual consent and conducting an assessment of the impact of personal
information protection. Any data handler providing data abroad shall perform data security protection
obligations and take technical and other necessary measures to ensure the security of data to be
provided abroad.
On December 8, 2022, the MIIT issued the Measures for the Administration of Data Security in
the Field of Industry and Information Technology (for Trial Implementation) (
ʷჯਹᅰኽ
༊Б), which became effective on January 1, 2023. The measures are aimed to
regulate the processing activities of data in the field of industry and information technology field
conducted by relevant data processors in China. The measures apply to industrial enterprises, software
and information technology service companies, and companies holding licenses for operation of
telecommunication services that independently determine the purposes and methods of data processing
in the course of data processing activities. Data processing activities include, among others, the
collection, storage, use, processing, transmission, provision, and disclosure of data. Pursuant to the
measures, data in the field of industry and information technology includes industrial data,
100


--- page 110 ---
REGULATORY OVERVIEW
telecommunication data, and radio data generated and collected during the operation of relevant
services. The measures provide for the classification of data in the field of industry and information
technology as general, important, or core data, and provide specific requirements for the management
of data classifications and data protection measures, including, among other things, data collection,
storage, processing, transmission, disclosure, and destruction for data processors in the field of industry
and information technology. In particular, data processors processing important data and core data are
required to complete filing with relevant authorities for the catalog of important data and core data.
The filing information includes basic information on the data, such as category, classification, quantity,
processing purposes and methods of data processing, scope of use, liable entities, data sharing, cross-
border transfer of data, and data security protection measures. If over 30% of the quantity (i.e. number
of data items or amount of data stored) of important and core data changes or there is any material
change to other filing information, data processors must update the filing information with the relevant
authorities within three months after such change. Furthermore, the measures provide data security
requirements for cross-border and data transfers for data processors. If a data processor needs to
transfer data in cases of merger, restructuring, or bankruptcy, it shall make data transfer plan and notify
users affected. In addition, the measures indicate that the legal representative or principal of the data
processor should be the primary person held accountable for data security and the person in charge of
data security should take direct responsibility for the security of data processing activities.
The Administrative Provisions on Security Vulnerability of Network Products (
τΌ
) was jointly promulgated by the MIIT, the CAC and the MPS on July 12, 2021 and
became effective on September 1, 2021. Network product providers, network operators as well as
organizations or individuals engaging in the discovery, collection, release and other activities of
network product security vulnerability are subject to these provisions and shall establish channels to
receive information of security vulnerability of their respective network products and shall examine
and fix such security vulnerability in a timely manner. In response to the Cyber Security Law, network
product providers are required to report relevant information of security vulnerability of network
products with the MIIT within two days and to provide technical support for network product users.
Network operators shall take measures to examine and fix security vulnerability after discovering or
acknowledging that their networks, information systems or equipment have security loopholes.
According to the Provisions, the breaching parties may be subject to monetary fine as regulated in
accordance with the Cyber Security Law.
On December 31, 2021, the MIIT, the CAC, the MPS and the State Administration for Market
Regulation (the “ SAMR”) jointly issued the Provisions on the Administration of Algorithm
Recommendation for Internet Information Services (
), which
became effective on March 1, 2022. Application of algorithm recommendation refers to the use of
algorithmic technologies such as generation and synthesis, personalized push, sorting and selection,
retrieval and filtering, scheduling decision-making to provide information to users. Algorithm
recommendation service providers with public opinion attribute or social mobilization ability shall go
through record-filing formalities within 10 business days from the date of provision of services.
Algorithm recommendation service providers that have completed record-filing shall indicate their
record-filing numbers and provide links to the publicized information on their websites and/or
applications.
On November 25, 2022, the MIIT issued the Provisions on the Administration of Deep
Synthesis of Internet Information Services (
), which became
101


--- page 111 ---
REGULATORY OVERVIEW
effective on January 10, 2023. These Provisions apply to the use of deep synthesis technologies to
provide internet information services and activities providing technical support to deep synthesis
services within the territory of the PRC. Pursuant to the provisions, the “deep synthesis technology”
refers to the technology using generative and synthesizing algorithms, with deep learning and virtual
reality as representative examples, to produce text, images, sound, video, virtual settings and other
such information, including but without limitation, technologies for generating or editing voice
content, such as text-to-speech, voice transformation, and voice characteristic editing. Deep synthesis
service providers shall (i) establish and improve control systems with regard to user registration,
algorithm review, technological ethic review, information public review, statistics security, personal
information protection, anti-telecom and online fraud, emergency disposal, etc. and take safe and
controlled technical protection measures; and (ii) formulate and publicize related management rules
and platform pacts, improve service agreements, perform the management responsibilities in
accordance with laws and agreements, and inform with explicit methods the technical supporters and
users of the in-depth integration of their respective information safety obligations. Where deep
synthesis service providers and technology providers provide models or templating tools with the
capability to edit facial generation, human voice or other distinguishing biological information, such
providers shall conduct security assessments. Where deep synthesis service providers and technology
providers provide editing functions for facial, vocal information or other distinguishing biological
information, they shall prompt deep synthesis service users and notify them and obtain separate
consent from the edited personal information subjects. In addition, as for deep synthesis service
providers that provide certain deep synthesis services, such as smart dialog, smart writing and other
such textual generation or editing services simulating natural persons, and synthesized voices, imitated
voices and other such speech generation or editing services that significantly change individual
identifying characteristics, such providers shall use prominent methods to label deep synthesis
information content, and effectively point out to the public the synthesized nature of the information
content. Deep synthesis service providers with public opinion attribute or social mobilization ability
shall conduct filing formalities in accordance with the Provisions on the Administration of Algorithm
Recommendation for Internet Information Services (
).
Pursuant to the Eleventh Amendment to the Criminal Law (ɤ
ɓ) issued by the SCNPC in December 26, 2020 and became effective in March 1, 2021, any
internet service provider that fails to fulfill the obligations related to the internet information security
administration as required by the applicable laws and refuses to rectify upon orders, shall be subject to
criminal penalty. Pursuant to the Notice of the Supreme People’s Court, the Supreme People’s
Procuratorate and the Ministry of Public Security on Legally Punishing Criminal Activities Infringing
upon the Personal Information of Citizens (
ڧ
), issued on April 23, 2013, Article 253 of the Criminal Law of the
PRC (), and the Interpretation of the Supreme People’s Court and the Supreme
People’s Procuratorate on Several Issues regarding Legal Application in Criminal Cases Infringing
upon the Personal Information of Citizens (
ڦ
༆ᙑ), which was issued on May 8, 2017 and took effect on June 1,
2017, the following activities may constitute the crime of infringing upon a citizen’s personal
information: (i) providing a citizen’s personal information to specified persons or releasing a citizen’s
personal information online or through other methods in violation of relevant national provisions;
(ii) providing legitimately collected information relating to a citizen to others without such citizen’s
consent (unless the information is processed, not traceable to a specific person and not recoverable);
(iii) collecting a citizen’s personal information in violation of applicable rules and regulations when
102


--- page 112 ---
REGULATORY OVERVIEW
performing a duty or providing services; or (iv) collecting a citizen’s personal information by
purchasing, accepting or exchanging such information in violation of applicable rules and regulations.
The Civil Code of the PRC (Պ) (the “ Civil Code”) that was issued by
the NPC on May 28, 2020 and took effect on January 1, 2021 provides that natural persons’ personal
information shall be protected by law and any organizations and individuals shall legally collect
personal information and ensure the security of personal information collected. It is not allowed to
illegally collect, use, process or transfer the personal information, or illegally buy or sell, provide or
make public the personal information of others. Personal information of natural persons refers to all
kinds of information recorded by electronic or otherwise that can be used to independently identify or
be combined with other information to identify the natural persons’ names, dates of birth, ID numbers,
biometric information, addresses, telephone numbers, e-mail addresses, health information,
whereabouts, etc. The processing of personal information shall be subject to the principle of
legitimacy, rightfulness and necessity, with no excessive processing, and shall meet the following
conditions: (i) with the consent of the natural person or the guardian thereof, unless otherwise provided
by laws or administrative regulations; (ii) expressly stating the purpose, method and scope of
information to be processed; and (iii) not violating the provision of the laws and administrative
regulations and the agreement of both parties. The Civil Code has revised the Internet tort liability and
further elaborated on “safe harbor” rule with respect to an internet service provider from both the
aspects of notice and counter notice, including (i) upon receiving notice from the right holder,
promptly adopting necessary protective measures such as deletion, screening or disconnection of
hyperlinks and reefing right holder’s notice to disputed internet user; and (ii) upon receiving counter-
notice from the disputed internet user, referring such counter-notice to the claiming right holder and
informing him/her to take other corresponding measures such as filing complaint with competent
authorities or suit with courts. The Civil Code has also provided that where the internet service
provider knew or should have known the infringing acts of the internet user, it shall be severally liable
with such internet user.
On August 20, 2021, the SCNPC issued the PRC Personal Information Protection Law (
ʕശ
) (the “ Personal Information Protection Law ”), which took effect from
November 1, 2021. The Personal Information Protection Law aims at protecting the personal
information rights and interests, regulating the processing of personal information, ensuring the orderly
and free flow of personal information in accordance with the law, and promoting the reasonable use of
personal information. The Personal Information Protection Law reiterates the circumstances under
which a personal information processor could process personal information and the requirements for
such circumstances, 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 party; (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 legally been made public
by the relevant individual or otherwise is processed within a reasonable scope; (vi) personal
information is processed within a reasonable scope to conduct news reporting, public opinion-based
supervision, and other activities in the public interest; or (vii) under any other circumstance as provided
by any law or regulation. It also stipulates the obligations of a personal information processor.
Furthermore, personal information processor shall, on the basis of the purposes of processing the
personal information, processing methods, categories of personal information, the impacts on
individuals, and potential security risks, among others, take necessary measures to ensure that personal
103


--- page 113 ---
REGULATORY OVERVIEW
information processing activities comply with the provisions of laws and administrative regulations,
and prevent unauthorized access to as well as the leakage, tampering or loss of personal information.
The Personal Information Protection Law provides that a personal information processor could
process publicly disclosed information within the reasonable scope in accordance therewith on the
basis of the six circumstances already specified thereunder. No organization or individual may illegally
collect, use, process or transmit personal information, illegally buy or sell, provide or make personal
information public, or engage in the processing of personal information that endangers the national
security or public interests. The Personal Information Protection Law clarifies the definition of
“Sensitive Personal Information”, which means personal information that, once leaked or illegally
used, may give rise to discrimination against individuals or seriously endanger personal or property
security, including information on biometrics, religious beliefs, specific identifications, medical health,
financial accounts, and personal whereabouts, among others. To process sensitive personal information
based on an individual’s consent, a personal information processor shall obtain the separate consent
from the individual. Where any law or administrative regulation provides that written consent shall be
obtained for processing sensitive personal information, such provision shall prevail. In terms of cross-
border transmission of personal information, pursuant to the Personal Information Protection Law, a
personal information processor, providing personal information to any party outside the territory of the
PRC, shall notify individuals of the overseas recipient’s identity, contact information, processing
purposes, processing methods, categories of personal information, the methods in which individuals
exercise the rights over the overseas recipient, and other matters, and obtain individuals’ separate
consent.
Furthermore, critical information infrastructure operators and the personal information
processors that process the personal information reaching or exceeding the threshold specified by the
national cyberspace administration in terms of quantity shall store domestically the personal
information collected and generated within the territory of the PRC. Where it is truly necessary to
provide the information abroad, the security assessment organized by the national cyberspace
administration shall be passed, unless otherwise regulated by laws, administrative regulations, or
provisions issued by the national cyberspace administrative authorities.
REGULATIONS ON PRODUCT LIABILITY AND CONSUMER RIGHTS PROTECTION
Regulations on Product Liability
According to the Civil Code, if defective products are identified after they have been put into
circulation, the manufacturers or the sellers shall take remedial measures such as issuance of a
warning, alerts, calls and recall of products in a timely manner. In the event of damage arising from a
defective product or the failure to take timely remedial actions, the infringed party may seek
compensation from either the manufacturer or seller of such a product. If the defect is caused by the
seller, the manufacturer shall be entitled to seek reimbursement from the seller upon compensation of
the victim. If the products are produced or sold with known defects, causing deaths or severe adverse
health issues, the infringed party has the right to claim punitive damages in addition to compensatory
damages.
Pursuant to the PRC Product Quality Law (
), which was
promulgated on February 22, 1993 and amended on July 8, 2000, August 27, 2009, and December 29,
2018, a manufacturer is prohibited from producing or selling products that do not meet applicable
104


--- page 114 ---
REGULATORY OVERVIEW
standards and requirements for safeguarding human health and ensuring human and property safety.
Products must be free from unreasonable dangers threatening human and property safety. Where a
defective product causes physical injury to a person or property damage, the infringed party may make
a claim for compensation from the manufacturer or the seller of the product. Manufacturers and sellers
of non-compliant products may be ordered to cease the production or sale of the products and could be
subject to confiscation of the products and/or fines. A seller of a product shall be responsible for
repairing, replacing or returning the product with the specified defects, and shall compensate for the
damages incurred by consumers who bought such defective product. After the seller performs its
obligation of repairing, replacing and returning the defective product and/or compensating for the
customers’ damages, such seller is entitled to seek reimbursement from the manufacturer of such
product, if it could be proved that the defect is caused by the manufacturer. Earnings from sales in
contravention of such standards or requirements may also be confiscated, and in severe cases, the
business license may be revoked.
A variety of consumer protection laws are also applicable to regulate our business including the
Consumer Rights and Interests Protection Law of the PRC (
),
which was amended on October 25, 2013 and became effective on March 15, 2014. It imposes
stringent requirements and obligations on business operators, who are required to guarantee that the
products and services they provide satisfy the requirements for personal or property safety. Business
operators are also required to provide consumers with authentic information about the quality,
function, usage and term of validity of the products or services. Failure to comply with these consumer
protection laws could result in a wide range of penalties including administrative sanctions, such as the
issuance of a warning, confiscation of illegal income, imposition of fines, an order to cease business
operations, revocation of business licenses, as well as potential civil or criminal liabilities.
Regulations on Compulsory Product Certification
According to the Administrative Regulations on Compulsory Product Certification (
ପ
) as promulgated by the General Administration of Quality Supervision, Inspection
and Quarantine of the PRC (the “ QSIQ”), which has been merged into the SAMR afterwards, on
July 3, 2009 and became effective on September 1, 2009 and was recently amended on September 29,
2022 and became effective on November 1, 2022 and the List of the First Batch of Products Subject to
Compulsory Product Certification (
ͦ፽) as promulgated by the
QSIQ in association with the State Certification and Accreditation Administration Committee, on
December 3, 2001, the SAMR is responsible for the regulation and quality certification.
Telecommunication terminal equipment and information technology equipment must not be sold,
exported or used in operating activities unless they are certified by certification authorities designated
by the State Certification and Accreditation Administration Committee as qualified products and
granted certification marks.
REGULATIONS ON INTELLECTUAL PROPERTY RIGHTS
Patents
According to the Patent Law of the PRC (Revised in 2020) (
2020ϋ
) promulgated by the SCNPC on October 17, 2020 and came into effect on June 1, 2021, and
its Implementation Rules (Revised in 2023) (2023)
promulgated by the State Council on December 11, 2023 and took effect on January 20, 2024, the State
105


--- page 115 ---
REGULATORY OVERVIEW
Intellectual Property Office of the PRC is responsible for administering patents in the PRC. The patent
administration departments of provincial or autonomous regions or municipal governments are
responsible for administering patents within their respective jurisdictions. The PRC patent system
adopts a first-to-file principle, which means that when more than one person files different patent
applications for the same invention, only the person who files the application first is entitled to obtain a
patent of the invention. To be patentable, an invention or a utility model must meet three criteria:
novelty, inventiveness, and practicability. A patent is valid for twenty years in the case of an invention,
ten years in the case of utility models, and fifteen years in the case of designs.
Copyright and Software Products
On September 7, 1990, the SCNPC promulgated Copyright Law of the PRC (
ʕശɛ͏΍ձ਷
) (the “ Copyright Law ”), which took into effect on June 1, 1991, and the Copyright Law
was then amended on October 27, 2001, February 26, 2010 and November 11, 2020 respectively, and
the latest amendment came into effect on June 1, 2021. The Copyright Law provides that Chinese
citizens, legal persons, or other organizations own copyrights in their copyrightable works, whether
published or not, which include, among others, works of literature, art, natural science, social science,
engineering technology, and computer software. Copyright owners enjoy certain legal rights, including
right of publication, right of authorship, and right of reproduction. The Copyright Law as revised in
2010 extends copyright protection to Internet activities, products disseminated over the Internet, and
software products. In addition, the Copyright Law provides for a voluntary registration system
administered by the China Copyright Protection Center. Pursuant to the Copyright Law, an infringer of
copyrights is subject to various civil liabilities, which include ceasing infringement activities,
apologizing to the copyright owners, and compensating the loss of the copyright owners. Infringers of
copyright may also be subject to fines and/or administrative or criminal liabilities in severe situations.
Pursuant to the Computer Software Copyright Protection Regulations (
ᚐૢԷ)
promulgated by the State Council on December 20, 2001 and most recently amended on January 30, 2013,
the software copyright owner may go through the registration formalities with a software registration
authority recognized by the State Council’s copyright administrative department. A software copyright
owner may authorize others to exercise that copyright and is entitled to receive remuneration.
Trademarks
Trademarks are protected by the PRC Trademark Law (
) promulgated
by the SCNPC on August 23, 1982 and subsequently amended on February 22, 1993, October 27, 2001,
August 30, 2013 and April 23, 2019 as well as the Implementation Regulation of the PRC Trademark
Law (
ૢԷ) promulgated by the State Council on August 3, 2002 and
amended on April 29, 2014. The Trademark Office handles trademark registrations and grants a term of
ten years to registered trademarks and another ten years if requested upon expiry of the first or any
renewed ten-year term. A trademark registrant may license its registered trademark to another party by
entering into a trademark license agreement, which must be filed with the Trademark Office for the
record. The licensor shall supervise the quality of the commodities on which the trademark is used, and
the licensee shall guarantee the quality of such commodities. As with patents, the PRC Trademark Law
has adopted a “first-to-file” principle with respect to trademark registration. Where a trademark for which
a registration has been made is identical or similar to another trademark which has already been
registered or been subject to a preliminary examination and approval for use on the same kind of or
similar commodities or services, the application for registration of such trademark may be rejected. Any
106


--- page 116 ---
REGULATORY OVERVIEW
person applying for the registration of a trademark may not prejudice the existing right first obtained by
others, nor may any person register in advance a trademark that has already been used by another party
and has already gained a “sufficient degree of reputation” through such party’s use.
Domain Names
The MIIT promulgated the Measures on Administration of Internet Domain Names (
ʝᑌၣਹ
) on August 24, 2017, which became effective on November 1, 2017. Pursuant to these
measures, the MIIT is in charge of the administration of PRC internet domain names. The domain
name registration follows a first-to-file principle. Applicants for registration of domain names shall
provide the true, accurate, and complete information of their identities to domain name registration
service institutions. The applicants will become the holder of such domain names upon the completion
of the registration procedure.
REGULATIONS ON EMPLOYMENT
Pursuant to the PRC Labor Law (
 ) promulgated by the SCNPC on
July 5, 1994, taking into effect on January 1, 1995 and amended on August 27, 2009 and December 29,
2018, the PRC Labor Contract Law (
) promulgated by the SCNPC on
June 29, 2007, amended on December 28, 2012 and taking into effect on July 1, 2013, and the
Implementing Regulations of the PRC Employment Contracts Law (
݄
ૢԷ) promulgated by the State Council and taking into effect on September 18, 2008, labor
relationships between employers and employees must be executed in written form. Wages may not be
lower than the local minimum wage. Employers must establish a system for labor safety and sanitation,
strictly abide by state standards and provide relevant education to its employees. Employees are also
required to work in safe and sanitary conditions.
Under PRC laws, rules and regulations, including the PRC Social Insurance Law (
ʕശɛ͏΍
) promulgated by the SCNPC on October 28, 2010 and taking into effect on July 1,
2011, which was amended on December 29, 2018, the Interim Regulations on the Collection and
Payment of Social Security Funds (
ᎈ൬ᅄᖮᅲБૢԷ) promulgated by the State Council
and taking into effect on January 22, 1990 and amended on March 24, 2019, and the Regulations on
the Administration of Housing Accumulation Funds (
၍ଣૢԷ) promulgated by the
State Council and taking into effect on April 3, 1999, and amended on March 24, 2002 and March 24,
2019, employers are required to contribute, on behalf of their employees, to a number of social security
funds, including funds for basic pension insurance, unemployment insurance, basic medical insurance,
occupational injury insurance, maternity leave insurance and housing accumulation funds. These
payments are made to local administrative authorities and any employer who fails to contribute may be
fined and ordered to pay the deficit amount.
REGULATIONS ON FOREIGN EXCHANGE
Regulation on Foreign Currency Exchange
Pursuant to the Foreign Exchange Administration Regulation of the PRC (
ʕശɛ͏΍ձ਷̮
ි၍ଣૢԷ), which was promulgated on January 29, 1996 and most recently amended on August 5,
2008, payments of current account items, such as profit distributions, interest payments and trade and
service-related foreign exchange transactions, can be made in foreign currencies without prior approval
107


--- page 117 ---
REGULATORY OVERVIEW
from the State Administration of Foreign Exchange (the “ SAFE”), by complying with certain
procedural requirements. By contrast, approval from or registration with appropriate government
authorities is required where RMB is to be converted into foreign currency and remitted out of China
to pay capital account items, such as direct investments, repayment of foreign currency-denominated
loans, repatriation of investments and investments in securities outside of China.
Pursuant to the Circular of Further Improving and Adjusting Foreign Exchange Administration
Policies on Foreign Direct Investment (
) (the
“Circular 59 ”), which was promulgated on November 19, 2012, became effective on December 17,
2012, and was further amended on May 4, 2015, October 10, 2018, and December 30, 2019, the
opening of various special purpose foreign exchange accounts, such as pre-establishment expenses
accounts, foreign exchange capital accounts and guarantee accounts, the reinvestment of RMB
proceeds derived by foreign investors in the PRC, and remittance of foreign exchange profits and
dividends by a foreign-invested enterprise to its foreign shareholders no longer require the approval or
verification of SAFE, and multiple capital accounts for the same entity may be opened in different
provinces, which was not possible previously. In 2013, SAFE specified that the administration by
SAFE or its local branches over direct investment by foreign investors in the PRC must be conducted
by way of registration and banks must process foreign exchange business relating to the direct
investment in the PRC based on the registration information provided by SAFE and its branches.
The Circular on Further Simplifying and Improving the Foreign Currency Management Policy on
Direct Investment (
)( t h e“Circular 13”), which
became effective on June 1, 2015 and was amended on December 30, 2019, cancels the administrative
approvals of foreign exchange registration of direct domestic investment and direct overseas investment
and simplifies the procedure of foreign exchange-related registration. Pursuant to the Circular 13,
investors should register with banks for direct domestic investment and direct overseas investment.
On May 11, 2013, SAFE promulgated the Provisions on Foreign Exchange Administration over
Domestic Investment by Foreign Investors (
)( “ Circular
21”), which was effective on May 13, 2013, amended on October 10, 2018 and partially abolished on
December 30, 2019. Circular 21 stipulates that SAFE and its branches shall manage foreign investors’
direct investment within the PRC through registration, and banks shall handle the foreign exchange
business of direct investment within the PRC according to the registration information provided by
SAFE or its branches.
According to the Circular of the State Administration of Foreign Exchange on Issues
concerning the Administration of Foreign Exchange Involved in Overseas Listing (
̮ි၍ଣ҅ᗫ
) announced by the SAFE on December 26, 2014, the SAFE and
its branch offices and administrative offices shall oversee, regulate and inspect domestic companies
regarding their business registration, opening and use of accounts, trans-border payments and receipts,
exchange of funds and other conduct involved in overseas listing. The domestic company shall, within
15 business days upon the end of its overseas public offering, handle registration formalities for
overseas listing with the foreign exchange authority at its place of registration with the required
materials.
The Circular on Reforming the Management Approach Regarding the Settlement of Foreign
Capital of Foreign-Invested Enterprise (
ഐි၍ଣ
) (the “ Circular 19 ”), which was promulgated on March 30, 2015, became effective on
108


--- page 118 ---
REGULATORY OVERVIEW
June 1, 2015, and was most recently amended on March 23, 2023, expands a pilot reform of the
administration of the settlement of the foreign exchange capitals of foreign-invested enterprises
nationwide. Circular 19 replaced both the Circular of the SAFE on Issues Relating to the Improvement
of Business Operations with Respect to the Administration of Foreign Exchange Capital Payment and
Settlement of Foreign-invested Enterprises (
˕˹
) (the “ Circular 142 ”), and the Circular of the SAFE on Issues
concerning the Pilot Reform of the Administrative Approach Regarding the Settlement of the Foreign
Exchange Capitals of Foreign-invested Enterprises in Certain Areas (
ί௅ʱήਜ
). Circular 19 allows all
foreign-invested enterprises established in the PRC to settle their foreign exchange capital on a
discretionary basis according to the actual needs of their business operation, provides the procedures
for foreign invested companies to use RMB converted from foreign currency-denominated capital for
equity investments and removes certain other restrictions that had been provided in Circular 142.
However, Circular 19 continues to prohibit foreign-invested enterprises from, among other things,
using RMB funds converted from their foreign exchange capital for expenditure beyond their business
scope and providing entrusted loans or repaying loans between non-financial enterprises.
The Notice on Reforming and Regulating Policies on the Control over Foreign Exchange
Settlement of Capital Accounts (
),
which was promulgated and became effective on June 9, 2016, provides that enterprises registered in
China may also convert their foreign debts from foreign currency into RMB on a self-discretionary
basis. This circular also provides an integrated standard for conversion of foreign exchange under
capital account items (including, but not limited to, foreign currency capital and foreign debts) on a
self-discretionary basis, which applies to all enterprises registered in China.
On January 26, 2017, SAFE promulgated the 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 (
ஷ
), which stipulates several capital control measures with respect to the outbound remittance of
profit from domestic entities to overseas entities, including: (i) banks should check board resolutions
regarding profit distribution, the original version of tax filing records, and audited financial statements
pursuant to the principle of genuine transactions; and (ii) domestic entities should hold income to
account for previous years’ losses before remitting the profits. Moreover, pursuant to this circular,
domestic entities should make detailed explanations of the sources of capital and utilization
arrangements, and provide board resolutions, contracts, and other proof when completing the
registration procedures in connection with an outbound investment.
On October 23, 2019, the SAFE promulgated the Notice on Further Advancing the Facilitation
of Cross-border Trade and Investment (
). Pursuant to
this notice, on the basis of allowing investment-oriented foreign-invested enterprise (including foreign-
invested investment companies, foreign-invested venture capital enterprises and foreign-invested
equity investment enterprises) to use capital funds for domestic equity investment in accordance with
laws and regulations, non-investment foreign-invested enterprises shall be allowed to use capital funds
for domestic equity investment in accordance with the laws under the premise of not violating the
Special Administrative Measures for Access of Foreign Investment (Negative List) and the authenticity
and compliance of their domestic invested projects.
109


--- page 119 ---
REGULATORY OVERVIEW
Pursuant to the Notice of the State Administration of Foreign Exchange on Optimizing Foreign
Exchange Administration to Support the Development of Foreign-related Business (̮ි၍ଣ҅
) promulgated and effective on April 10, 2020 by SAFE,
the reform of facilitating the payments of incomes under the capital accounts will be promoted
nationwide. Under the prerequisite of ensuring true and compliant use of funds and compliance and
complying with the prevailing administrative provisions on use of income from capital projects,
enterprises which satisfy the criteria are allowed to use income under the capital account, such as
capital funds, foreign debt, and overseas listing, for domestic payment, without the need to provide
proof materials for veracity to the bank beforehand for each transaction.
REGULATIONS ON TAXATION
Enterprise Income Tax
On March 16, 2007, the NPC promulgated the Enterprise Income Tax Law of the PRC (
ʕശ
) (the “ EIT Law ”), which was amended on February 24, 2017 and
December 29, 2018. On December 6, 2007, the State Council enacted the Regulations for the
Implementation of the Enterprise Income Tax Law of the PRC (
ૢ
Է), which became effective on January 1, 2008 and amended on April 23, 2019 and December 6,
2024. Under the EIT Law and its implementation regulations, both resident enterprises and
non-resident enterprises are subject to tax in China. Resident enterprises are defined as enterprises that
are established in China in accordance with PRC laws, or that are established in accordance with the
laws of foreign countries but are actually or in effect controlled from within China. Non-resident
enterprises are defined as enterprises that are organized under the laws of foreign countries and whose
actual management is conducted outside China, but have established institutions or premises in China,
or have no such established institutions or premises but have income generated from inside China.
Under the EIT Law and relevant implementing regulations, a uniform corporate income tax rate of
25% is applied.
According to the EIT Law, the EIT tax rate of a high and new technology enterprise is 15%.
Pursuant to the Administrative Measures for the Recognition of High and New Technology Enterprises
(
) promulgated by Ministry of Science and Technology, Ministry of
Finance (the “MOF”) and SAT on April 14, 2008 and further revised on January 29, 2016, which took
effect on January 1, 2016, the Certificate of a High and New Technology Enterprise is valid for three
years. According to the Rules for the Implementation of the Law of the PRC on the Administration of
Tax Collection (
) promulgated by the State Council on
February 6, 2016 and came into effect on the same date, taxpayers who enjoy tax reduction or
exemption incentives shall, upon expiry of the tax reduction or exemption period, resume tax payment
from the day following the expiry date. In the event of changes to the criteria for tax reduction or
exemption, the taxpayer shall submit a report to the tax authorities within the tax declaration period.
Taxpayers who no longer satisfy the criteria for tax reduction or exemption shall perform tax payment
obligation pursuant to the law.
Value-added Tax
According to the Provisional Regulations of the PRC on Value-Added Tax (
ʕശɛ͏΍ձ
೼ᅲБૢԷ) promulgated by the State Council on December 13, 1993 and amended on
November 10, 2008, February 6, 2016, and November 19, 2017, the Detailed Rules for the
110


--- page 120 ---
REGULATORY OVERVIEW
Implementation of the Provisional Regulations of the PRC on Value-added Tax (࠽
) promulgated by the MOF on December 25, 1993 and amended on
December 15, 2008 and October 28, 2011, the Decisions on Abolishing the Provisional Regulations of
the PRC on Business Tax and Amending the Provisional Regulations of the PRC on Value-added Tax
(
Ӕ
) which was promulgated by the State Council and effective on November 19, 2017, the Circular
on Adjustment of Value-added Tax Rates () jointly promulgated by
MOF and SAT on April 4, 2018 and taking into effect on May 1, 2018, and the Announcement on
Relevant Policies for Deepening Value-added Tax Reform (
ʮѓ)
jointly promulgated by the MOF, the SAT and the General Administration of Customs on March 20,
2019 and taking into effect on April 1, 2019, all taxpayers selling goods, providing processing,
repairing or replacement services or importing goods within the PRC shall pay value-added tax (the
“VAT”) and the VAT rates are further revised to 6%, 9% or 13%.
In accordance with the Notice on Value-added Tax Policies for Software Products (
௅e
) which was promulgated by the MOF and the SAT on
October 13, 2011 and came into effect on January 1, 2011, a value-added tax general taxpayer selling
software products developed and produced by itself shall be subject to levying and collection of value-
added tax at the tax rate of 17%, and the policy of forthwith levy and forthwith refund shall be
implemented for the portion of value-added tax actually paid which exceeds 3%.
On December 25, 2024, the SCNPC published the PRC Value-Added Tax Law
ʕശɛ͏΍
, which will come into effect on January 1, 2026, replacing the Provisional
Regulations of the PRC on Value-Added Tax. The new law reaffirms the provisions of the Provisional
Regulations of the PRC on Value-Added Tax and make changes in the areas of taxable acts, tax
jurisdiction, deemed sales, nontaxable items, simplified taxation, withholding agents, input taxes, non-
creditable input taxes, mixed sales, and input credit carry-forward and refund.
REGULATIONS ON COMPANY ESTABLISHMENT
The establishment, operation and management of companies in the PRC are governed by the
Company Law of the PRC (
) (the “ PRC Company Law ”), as amended in
1999, 2004, 2005, 2013 and 2018. According to the PRC Company Law, companies established in the
PRC are either limited liability companies or companies limited by shares. A company is an enterprise
legal person with independent legal person property, and is entitled to legal person property rights. The
company shall bear liabilities for its debts with all its assets. The shareholders of a limited liability
company shall bear liabilities for the company to the extent of their respective subscribed capital
contribution. The shareholders of a company limited by shares shall bear liabilities for the company to
the extent of their respective subscribed shares. On December 29, 2023, the SCNPC published the
amended PRC Company Law, which came into effect on July 1, 2024. According to the Administrative
Regulation on the Registration of Market Entities of the PRC (
ʕശɛ͏΍ձ਷̹ఙ˴᜗೮া၍ଣૢԷ
), which were promulgated by the State Council on July 27, 2021 and became effective on March 1,
2022, and other laws and regulations governing the registrations of market entities, the establishment
of a market entity and any capital increase and other major changes herein shall be registered with the
SAMR or its local counterparts and filed via the enterprise registration system.
111


--- page 121 ---
REGULATORY OVERVIEW
REGULATIONS ON FOREIGN INVESTMENT
The Foreign Investment Law of the PRC () (the “ Foreign
Investment Law ”), which was promulgated by the NPC on March 15, 2019 and came into effect on
January 1, 2020, and the former Sino-foreign Equity Joint Ventures Laws of the PRC, Wholly Foreign-
owned Enterprises Law of the PRC and Sino-foreign Cooperative Joint Ventures Laws of the PRC
were repealed simultaneously. Since then, the Foreign Investment Law has become the fundamental
law regulating wholly or partially foreign-invested enterprises invested by foreign investors. The
provisions of laws, such as the PRC Company Law shall apply to the organization form, organization
structure and standards of activities of foreign-invested enterprises. The PRC implements the
management system of pre-establishment national treatment and negative list for foreign investment,
and has canceled the original approval and filing management system for the establishment and change
of foreign-invested enterprises. Pre-establishment national treatment refers to the treatment given to
foreign investors and their investments at their pre-admission shall be no less favorable than that given
to Chinese investors and their investments; while the negative list refers to the special administrative
measures for foreign investment access implemented according to the requirements of the state with
respect of foreign investment in specific industries, and the national treatment will be given to foreign
investments outside the negative list. UNISOUND AI TECHNOLOGY CO., LTD. is a foreign
invested company incorporated in the PRC and is subject to the provisions of the Foreign Investment
Law.
The Foreign Investment Law further regulates the administration of foreign investment and
proposes to establish a foreign investment information reporting system to replace the approval and
filing system for foreign investment enterprises. The Foreign Investment Information Report is
governed by the Measures for the Reporting of Foreign Investment Information (
జѓ፬
), which was jointly formulated by the Ministry of Commerce and the SAMR and came into effect
on January 1, 2020. According to the Measures for the Reporting of Foreign Investment Information,
foreign investors conducting investment activities directly or indirectly in the PRC shall submit
investment information to the competent commerce authorities through the enterprise registration
system and the national enterprise credit information publicity system, which shall include initial
report, change report, cancelation report, annual report, etc.
On October 26, 2022, the National Development and Reform Commission (the “ NDRC”) and
the Ministry of Commerce published the Encouraged Industry Catalog for Foreign Investment (2022
version) (
ོᎸ̮ਠҳ༟ପุͦ፽(2022و)), which became effective on January 1, 2023, further
expanding the scope of encouraged industry catalog for foreign investment. On September 6, 2024, the
NDRC and the Ministry of Commerce of the PRC issued the Special Administrative Measures for
Access of Foreign Investment (Negative List) (2024 Edition) (
݄(૶
ఊ)(2024), which became effective on November 1, 2024. Industries not listed in the negative
list and encouraged industry catalog for foreign investment are generally open for foreign investments
unless specifically restricted by other PRC laws. Our business does not fall within the scope of
industries restricted or prohibited for foreign investment.
REGULATIONS ON ANTI-MONOPOLY
Pursuant to the PRC Anti-Monopoly Law (Revised in 2022) (the “ Anti-Monopoly Law ”)
(
(2022ࠈࡌpromulgated by the SCNPC on June 24, 2022 and took
effect on August 1, 2022, prohibited monopolistic conducts including monopoly agreements, abuse of
112


--- page 122 ---
REGULATORY OVERVIEW
dominant market position and concentration of business operators that may have the effect of
eliminating or restricting competition.
Monopoly Agreement
Pursuant to the Anti-Monopoly Law and the Provisions on the Prohibitions of Monopoly
Agreements (), which was issued by the SAMR on March 10, 2023 and took
effect on April 15, 2023 and replaced the Interim Provisions on the Prohibitions of Monopoly
Agreements (
), competing business operators shall not enter into monopoly
agreements that eliminate or restrict competition, such as by boycotting transactions, fixing or
changing the price of commodities, limiting the output of commodities, fixing the price of commodities
for resale to third parties, and shall not enter into other acts in concert. Pursuant to the Provisions on
the Prohibitions of Monopoly Agreements, when identifying other acts in concert, the following factors
shall be considered: (i) whether the market behaviors of operators are consistent, (ii) whether operators
have communication of intention or information exchange, (iii) whether operators can reasonably
explain the consistency of the behaviors, and (iv) the market structure, competition status, market
changes and other circumstances of the relevant markets. Such monopoly agreements and other acts in
concert are prohibited unless, among others, the agreement will satisfy the exemptions under the
Anti-monopoly Law, such as improving technologies, increasing the efficiency and competitiveness of
small and medium-sized undertakings, or safeguarding legitimate interests in cross-border trade and
economic cooperation with foreign counterparts. Sanctions for violations include an order to cease the
relevant activities, and confiscation of illegal gains and fines (from 1% to 10% of sales revenue from
the previous year, or up to RMB3,000,000 if the intended monopoly agreement has not been
performed).
Abuse of Dominant Market Position
Pursuant to the Anti-Monopoly Law, a business operator with a dominant market position shall
not abuse its dominant market position to conduct acts, such as selling commodities at unfairly high
prices or buying commodities at unfairly low prices, selling products at prices below cost without any
justifiable cause, and refusing to trade with a trading party without any justifiable cause. The
Provisions on Prohibition of Abuse of Market Dominance (
), which
was issued by the SAMR on March 10, 2023 and took effect on April 15, 2023 and replaced the
Interim Provisions on the Prohibitions of Acts of Abuse of Dominant Market Positions (
ຫ˟ᏺ̹͜
), providing relevant factors to consider when deciding whether a specific
business operator enjoys a dominate market position. Sanctions for violation of the prohibition on the
abuse of dominant market position include an order to cease the relevant activities, confiscation of the
illegal gains and fines (from 1% to 10% of sales revenue from the previous year).
Concentration of Business Operators
Pursuant to the Anti-Monopoly Law, where a concentration of business operators reaches the
threshold for declaration, an advance declaration shall be made to the anti-monopoly law enforcement
authority under the State Council. Concentration of business operators refers to (i) a merger of business
operators; (ii) acquiring control over other business operators by acquiring equities or assets; or
(iii) acquisition of control over or the possibility of exercising decisive influence on other business
operators by contract or by any other means. If a business operator fails to comply with the mandatory
declaration requirement, the anti-monopoly enforcement authority is empowered to terminate and/or
113


--- page 123 ---
REGULATORY OVERVIEW
unwind the transaction, dispose of relevant assets, shares or businesses within certain periods and
impose a fine of up to 10% of its sales revenue in the previous year or a fine up to RMB5,000,000 if
the concentration has no effect of eliminating or restricting competition.
The Provisions on the Review of Business Operator Concentration (
)
promulgated by the SAMR on March 10, 2023 and implemented on April 15, 2023, which replaced the
Interim Provisions on the Review of Business Operator Concentration (
)
issued on October 23, 2020 and its amendment issued on March 24, 2022, further providing matters
such as the declaration and review of the concentration of business operators and the investigation of
the illegal implementation of the concentration of business operators.
REGULATIONS ON ANTI-UNFAIR COMPETITION
Pursuant to the Anti-Unfair Competition Law of the PRC (
)
(the “Anti-Unfair Competition Law ”), which was amended by the SCNPC and came into effect on
April 23, 2019, unfair competition is defined as an act in which an operator violates the provisions of
the Anti-Unfair Competition Law in its production and operation activities, disturbs the market
competition order and damages the legitimate rights and interests of other operators or consumers.
According to the Anti-Unfair Competition Law, business operators shall abide by the principles of
voluntariness, equality, fairness and integrity and abide by laws and business ethics in their market
transactions. Operators who violate the provisions of the Anti-Unfair Competition Law shall be subject
to corresponding civil, administrative or criminal liabilities according to the specific circumstances.
Pursuant to the Provisional Regulations of the State Administration for Industry and Commerce
on Banning Commercial Bribery (
) (the
“Provisions on Banning Commercial Bribery ”) promulgated by the former State Administration for
Industry and Commerce and taking effect on November 15, 1996, commercial bribery refers to the act
of a business operator to bribe another entity or individual by using property or other means for the
purpose of selling or purchasing goods, and “other means” refers to the means of providing benefits
other than property, such as travel or visits, in various names at home and abroad. According to the
Anti-Unfair Competition Law and the Provisions on Banning Commercial Bribery, the supervision and
inspection authorities may impose fines according to the circumstances, and confiscate any illegal
gains.
REGULATIONS ON OVERSEAS LISTING
On July 6, 2021, the General Office of the State Council and General Office of the Central
Committee of the Communist Party of China issued Opinions on Strictly Cracking Down Illegal
Securities Activities in Accordance with the Law (
จԈ). The
opinions emphasized the need to strengthen the administration over illegal securities activities and the
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.
On February 17, 2023, the Chinese Securities Regulatory Commission (the “ CSRC”) issued
the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic
Companies (
) (the “ Overseas Listing Regulations ”),
and five supporting guidelines, which became effective on March 31, 2023. Pursuant to the Overseas
114


--- page 124 ---
REGULATORY OVERVIEW
Listing Regulations, companies in mainland China that directly or indirectly offer or list their securities
in an overseas market, including a company in mainland China limited by shares and an offshore
company whose main business operations are in mainland China and intends to offer shares or be listed
in an overseas market based on its equities, assets or similar interests in mainland China are required to
file with the CSRC within three business days after submitting their listing application documents to
the regulator in the place of intended listing. Failure to complete the filing under the Overseas Listing
Regulations or conceals any material fact or falsifies any major content in its filing documents may
subject the company to administrative penalties, such as order to rectify, warnings, fines, and its
controlling shareholders, actual controllers, direct officers-in-charge and other direct
personnel-in-charge may also be subject to administrative penalties, such as warnings and fines. The
Overseas Listing Regulations also provide that a company in mainland China must file with the CSRC
within three business days for its follow on offering of securities after it is listed in an overseas market.
In addition, pursuant to the Overseas Listing Regulations, enterprises in mainland China are
prohibited from overseas offering and listing under any of the following circumstances, if (i) the
overseas offering and listing is explicitly prohibited by PRC laws; (ii) the overseas offering and listing
may constitute a threat to or endanger national security as determined by relevant PRC authorities;
(iii) the domestic enterprises and their controlling shareholders and actual controllers have committed
certain criminal offenses (such as corruption, bribery, embezzlement, misappropriation of property or
other criminal offenses undermining the order of the socialist market economy) in the past three years;
(iv) the domestic enterprises are currently under investigations in connection with suspicion of having
committed criminal offenses or material violations of applicable laws and regulations and there is still
no explicit conclusion; or (v) there is material ownership disputes over the shareholdings held by the
controlling shareholder or the shareholder under the control of the controlling shareholder or the actual
controllers.
On February 24, 2023, the CSRC, jointly with other relevant governmental authorities, issued the
Provisions on Strengthening the Confidentiality and Archive Management Work Relating to the Overseas
Securities Offering and Listing by Domestic Companies (
ڭ
)( t h e“ Confidentiality and Archives Management Provisions ”), which
took effect on March 31, 2023. Pursuant to the Confidentiality and Archives Management Provisions,
companies based in mainland China that offer and list securities in overseas markets shall establish
confidentiality and archives system. The “companies based in mainland China” refer to companies in
mainland China limited by shares which are directly listed in the overseas capital market and the
domestic operation entities of an offshore company being indirectly listed in a foreign stock exchange.
The companies based in mainland China shall obtain approval from the relevant authorities and file with
the confidential administration department at the same level when providing or publicly disclosing
documents and materials related to state secrets or secrets of the government authorities to the relevant
securities companies, securities service agencies or the offshore regulatory authorities, or providing or
publicly disclosing such documents and materials through its offshore listing entity. In addition, the
companies based in mainland China should complete corresponding procedures when (i) providing or
publicly disclosing documents and materials which may adversely affect national security and public
interest to the relevant securities companies, securities service agencies or the offshore regulatory
authorities, (ii) providing or publicly disclosing such documents and materials through its offshore listing
entity, or (iii) providing accounting files or copies to relevant security companies, security service
institutions, overseas regulators and individuals. The companies based in mainland China are also
required to provide written statements on the implementation of the aforementioned rules to the relevant
securities companies and securities service agencies. If a company based in mainland China finds that the
115


--- page 125 ---
REGULATORY OVERVIEW
documents and materials related to state secrets or secrets of the government authorities or other
materials which may adversely affect national security and public interest have been leaked or are going
to be leaked, it should take remedial measures immediately and report to the relevant authorities.
REGULATIONS ON THE H SHARE FULL CIRCULATION
“Full circulation” means listing and circulating on the stock exchange of the domestic unlisted
shares of an H-share listed company, including unlisted domestic shares held by domestic shareholders
prior to overseas listing, unlisted domestic shares additionally issued after overseas listing, and unlisted
shares held by foreign shareholders. On November 14, 2019, the CSRC issued the Guidelines for the
“Full Circulation” Program for Domestic Unlisted Shares of H-share Listed Companies (
Hʮ̡ྤ
΅͡ሗ“ஷ”ˏ) (the “ Guidelines for the Full Circulation ”), which was
amended on August 10, 2023.
According to the Guidelines for the Full Circulation, shareholders of domestic unlisted shares
may determine by themselves through consultation the amount and proportion of shares, for which an
application will be filed for circulation, provided that the requirements laid down in the relevant laws
and regulations and set out in the policies for state-owned asset administration, foreign investment and
industry regulation are met, and the corresponding H-share listed company may be entrusted to file the
said application for full circulation. To apply for full circulation, an H-share listed company shall file
the application with the CSRC according to the filing procedures necessary for the Overseas Listing
Regulations. After the application for full circulation has been approved by the CSRC, the H-share
listed company shall submit a report on the relevant situation to the CSRC within 15 days after the
registration with China Securities Depository and Clearing Limited (the “ CSDC”) of the shares related
to the application has been completed. After domestic unlisted shares are listed and circulated on the
Hong Kong Stock Exchange, they may not be transferred back to China.
On December 31, 2019, CSDC and the Shenzhen Stock Exchange jointly announced the
Measures for Implementation of H-share Full Circulation Business (
Hٰ“ஷ”)
(the “Measures for Implementation ”) to regulate 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.
In addition, the Shenzhen Branch of CSDC released the Guide for “Full Circulation” Business
of H Shares by the Shenzhen Branch of China Securities Depository and Clearing Corporation Limited
(
ப΂ʮ̡ଉέʱʮ̡Hٰ“ஷ”) on September 20, 2024, which
clearly provides for business arrangements and procedures related to H-share full circulation business,
including business preparation, cross-border transfer registration, overseas depository of shares and
initial maintenance and change in maintenance of domestic holding details, corporate behavior
processing, clearing and settlement, risk management and business charges.
Pursuant to the Overseas Listing Regulations, in respect of a domestic company directly listed
overseas, shareholders holding its unlisted domestic shares who apply to convert such shares held by
them into listed overseas shares and to be listed in an overseas stock exchange, shall comply with the
relevant regulations of the CSRC and entrust domestic enterprises to file with the CSRC.
116


--- page 126 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
OVERVIEW
We are an AI company dedicated to the innovation in AGI technology in China, with strong
record in commercializing AI large language models, the critical path towards AGI. Our history dates
back to June 2012 when the predecessor of our Company, namely Beijing Unisound Information
Technology Co., Ltd. (
ʮ̡)( “Unisound Information”) was established. Our
Group was founded by Dr. Liang, Dr. Huang and Dr. Kang, who have profound industry knowledge
and insights in the field of AGI, and rich experience in AI R&D and industrialization. For details of the
biographies of our founders, see “Directors, Supervisors and Senior Management.” In June 2019, our
Company was converted into a joint stock company with limited liabilities. Over the years, we have
developed our proprietary UniGPT, based on which we provide comprehensive AI products and
solutions to our customers.
OUR KEY MILESTONES
The following is a summary of our Group’s key business development milestones:
Year Milestone
2012 • Established Unisound Information, the predecessor of our Company
• Released our cloud-based speech recognition service in China, being one of the first
companies to apply deep learning algorithms to commercial speech recognition
2013 • Completed our first-generation full pack AI system with perception and cognition capabilities
2014 • Proposed the “cloud+chip” technical architecture in Daily Life scenario
2015 • Completed the Series B Financing introducing investors including TBP HK and Qualcomm
2016 • Cooperated with Gree in Daily Life scenario and Peking Union Medical College Hospital in
Healthcare scenario
• Commenced the development of our Atlas AI infrastructure
2018 • Launched our UniOne series, our edge side conversational AI chip
• Leveraging emerging Transformer algorithms, we achieved top two ranking in the Machine
Translation (WMT)
• Completed the Series C Financing introducing investors including CII Fund, JD Shangke,
Qirui Tiancheng and CICC Jiatai
2019 • Launched our first large language model, UniCore, built through unsupervised pre-train, with
hundreds of millions of parameters
• Launched our medical record quality management solutions and commercialized in several
medical institutions
• Awarded the Best Paper by China Conference on Knowledge Graph and Semantic
Computing (CCKS) (ၑɽึ) and the 2019 Beijing Science and
Technology Progress Award, First Prize (ኪҦஔආӉᆤɓഃᆤ)
2020 • Provided AI services to more than 25,000 developers, including leading automobile
companies
• Ranked first place in several indicators in the Blizzard Challenge International Evaluation of
speech synthesizers and won Best English Paper Award in a task of CCKS
• Delivered our Medical Insurance Supervision Platform to a large-scale state-owned insurance
company, which was applied in unannounced inspection for medical insurance
117


--- page 127 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Year Milestone
2021 • Provided over six million consumer-grade AI chips, and put in IP and key technological
support for R&D of vehicle-grade AI chips
• Recognized as the “Little Giants” enterprise by Ministry of Industry and Information
Technology
• Our projects were for the third time included in the national key R&D project by Ministry of
Science and Technology
• Won first prize in the Acronym Extraction and Acronym Disambiguation tasks at 2021
Association for the Advancement of Artificial Intelligence (AAAI) conference
2022 • Provided approximately 13 million consumer-grade AI chips, and commercialized and put
our vehicle-grade chips into use through NPU IP licensing
• Applied our Healthcare solutions in over 200 hospitals since our inception
2023 • Launched UniGPT, a proprietary 60 billion-parameter large language model
• Applied our successful delivery of Daily Life solutions to metro lines in Guangzhou,
Shenzhen and Qingdao to a wider range of cities including Nanning
• Raised more than RMB700 million from the Series D3 Financing
2024 • We obtained official approval and license for UniSound Post- Doctoral R&D Workstation.
• We cooperated with a leading vehicle enterprise on intelligent cockpit and had in-depth
cooperation with a global leading technology company.
• Three National Standards in relation to AI Large Model which we participated in preparation
were issued.
OUR MAJOR SUBSIDIARIES
As of the Latest Practicable Date, the following entities are our major subsidiaries which 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
Shenzhen Unisound PRC December 28, 2015 100% R&D and providing
solutions for Daily Life
scenarios
Shanghai Unisound PRC August 7, 2017 100% R&D and sales of AI
technologies and software
and hardware products
Xiamen Unisound PRC October 18, 2017 100% Providing comprehensive
solutions for Daily Life
scenarios
Hangzhou Unisound PRC June 6, 2023 100% R&D and sales of AI
technologies and software
and hardware products
MAJOR SHAREHOLDING CHANGES OF OUR COMPANY
Establishment of our Company
On June 29, 2012, our Company was established as a limited liability company under the laws
of the PRC, with an initial registered capital of RMB1,000,000, and held as to 92.5% and 7.5% by Dr.
Liang and Dr. Kang, respectively.
118


--- page 128 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Capital Increase in November 2012 and February 2013
Heyi Guyu Equity Investment Partnership (Limited Partnership) (௴ุҳ༟ΥྫΆ
ุ(Υྫ)) (“Heyi Guyu”) subscribed for a registered capital of RMB160,713 with a consideration
of RMB9 million, which was settled in November 2012. Heyi Guyu further subscribed for a registered
capital of RMB89,287 with a consideration of RMB4 million, which was settled in January 2013.
Upon the completion of the above subscriptions, the shareholding structure of our Company in
February 2013 was as follows:
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Dr. Kang ................................................. 75,000 6%
Dr. Liang ................................................. 925,000 74%
Heyi Guyu ................................................ 250,000 20%
Total .................................................... 1,250,000 100%
Capital Increase in April 2013
In April 2013, the registered capital of our Company was increased to RMB10,000,000 through
conversion of capital reserve as approved by the shareholders meeting. Upon the completion of the
capital increase, the shareholding structure of our Company in April 2013 was as follows:
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Dr. Kang ................................................. 600,000 6%
Dr. Liang ................................................. 7,400,000 74%
Heyi Guyu ................................................ 2,000,000 20%
Total .................................................... 10,000,000 100%
Series A Financing in March 2014
We completed the Series A financing in March 2014 through capital increases as detailed
below:
Subscribers Registered Capital subscribed for Consideration
(RMB)
Heyi Guyu ...................................... 500,000 RMB12,333,600
Ming Fu Investments Limited (“ Ming Fu” ) ........... 2,000,000 US dollars equivalent
to RMB49,334,773.5
Upon the completion of the above subscriptions, the shareholding structure of our Company in
March 2014 was as follows:
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Dr. Kang ................................................. 600,000 4.8%
Dr. Liang ................................................. 7,400,000 59.2%
Heyi Guyu ................................................ 2,500,000 20%
Ming Fu .................................................. 2,000,000 16%
Total .................................................... 12,500,000 100%
119


--- page 129 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Equity Transfer in September 2014
On August 6, 2014, pursuant to the mutual commercial arrangement between Dr. Liang and
Dr. Huang, Dr. Liang entered into a share transfer agreement with Yunsi Shangde (Tianjin) Asset
Management Consulting Partnership (Limited Partnership) (ᅃ(ݵ)༟ପ၍ଣፔ༔ΥྫΆุ(Υ
ྫ)) (“Yunsi Shangde”), whose general partner and largest limited partner with 98.8% partnership interest
is Dr. Huang, pursuant to which Dr. Liang transferred the 51.2% equity interest held by him in our
Company to Yunsi Shangde with a consideration of RMB1,032 million which was determined through
arm’s length negotiation and upon approvals by the Board. The transfer was effected in September 2014.
Series B Financing in March 2015
We completed the Series B financing in March 2015 through share transfers and capital
increases. Details of the respective capital transfers are as follows:
Transferor Transferee
Registered Capital
transferred Consideration
(RMB) (US$)
Dr. Liang ........................ S k y Galaxy Investment Limited (“
Sky Galaxy”)
32,230 350,000
Dr. Kang ........................ 19,338 216,660
Yunsi Shangde .................... 39,896 433,340
Yunsi Shangde .................... Ming Fu 134,146 1,466,666
Heyi Guyu ....................... 182,927 1,999,999
Details of the respective capital increases are as follows:
Subscribers Registered Capital subscribed for Consideration
(RMB) (US$)
TBP Sound Cloud Holdings (HK) Limited (“ TBP HK” ) ......... 2,286,585 25,000,000
Qualcomm International, Inc. (“ Qualcomm” ) ................. 457,317 5,000,000
Upon the completion of the above capital transfers and subscriptions, the shareholding structure
of our Company in March 2015 was as follows:
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Dr. Kang ................................................. 580,662 3.81%
Dr. Liang ................................................. 967,770 6.35%
Heyi Guyu ................................................ 2,317,073 15.2%
Ming Fu .................................................. 2,317,073 15.2%
Yunsi Shangde ............................................. 6,225,958 40.84%
Sky Galaxy ............................................... 91,464 0.60%
Qualcomm ................................................ 457,317 3%
T B PH K.................................................. 2,286,585 15%
Total .................................................... 15,243,902 100%
Capital Increase in July 2015
As part of the arrangement under the Employee Incentive Scheme, Yunchuang Hudong
subscribed for a registered capital of RMB973,015 at par value. The general partner of Yunchuang
Hudong is Tianjin Yunsheng, which is held by Dr. Huang and Mr. Liu Shengping, our executive
Director, as to 99% and 1%, respectively. See “– Employee Incentive Schemes”.
120


--- page 130 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Upon the completion of the above subscription, the shareholding structure of our Company in
July 2015 was as follows:
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Dr. Kang ................................................. 580,662 3.58%
Dr. Liang ................................................. 967,770 5.97%
Heyi Guyu ................................................ 2,317,073 14.29%
Ming Fu .................................................. 2,317,073 14.29%
Yunsi Shangde ............................................. 6,225,958 38.39%
Sky Galaxy ............................................... 91,464 0.56%
Qualcomm ................................................ 457,317 2.82%
T B PH K.................................................. 2,286,585 14.10%
Yunchuang Hudong ......................................... 973,015 6.00%
Total .................................................... 16,216,917 100%
Series B+ Financing in February 2016
We completed the Series B+ financing in February 2016 through capital increases as detailed
below:
Subscribers
Registered Capital
subscribed for Consideration
(RMB) (RMB)
Ningbo Lianchuang Cornerstone Investment Partnership (Limited Partnership)
(ᑌ௴ਿͩҳ༟ΥྫΆุ(Υྫ)) (“Ningbo Lianchuang” ) .......... 122,856 12,500,000
Ningbo Lianli Gongda Investment Management Partnership (Limited
Partnership) (ᑌл΍༺ҳ༟၍ଣΥྫΆุ(Υྫ)) (“Ningbo
Lianli” )........................................................ 368,566 37,500,000
Upon the completion of the above subscription, the shareholding structure of our Company in
February 2016 was as follows:
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Dr. Kang ................................................. 580,662 3.47%
Dr. Liang ................................................. 967,770 5.79%
Heyi Guyu ................................................ 2,317,073 13.87%
Ming Fu .................................................. 2,317,073 13.87%
Yunsi Shangde ............................................. 6,225,958 37.26%
Sky Galaxy ............................................... 91,464 0.55%
Qualcomm ................................................ 457,317 2.74%
T B PH K.................................................. 2,286,585 13.69%
Yunchuang Hudong ......................................... 973,015 5.82%
Ningbo Lianchuang ......................................... 122,856 0.73%
Ningbo Lianli ............................................. 368,566 2.21%
Total .................................................... 16,708,339 100%
Equity Transfer in July 2016
On April 20, 2016, Yunsi Shangde entered into a share transfer agreement with Yunsi Shangyi,
pursuant to which Yunsi Shangde transferred all the registered capital of RMB6,225,958 held by it,
121


--- page 131 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
representing 37.26% of the then total registered capital of our Company, to Yunsi Shangyi with a
consideration of RMB62,260. The general partner of Yunsi Shangyi is Tianjin Yunsheng, which is
held as to 99% by Dr. Huang. Dr. Huang is also the largest limited partner of Yunsi Shangyi with over
80% partnership interest.
At the time of the transfer in 2016, Yunsi Shangde was held by Dr. Huang as the general partner
holding 98.83% partnership interest, and Ms. Yang Xue (
เ௛), being the spouse of Mr. Lu Yongyi (ۇ
ᆇ) who is a former employee of the Company, as the limited partner holding the remaining 1.17%
partnership interest. In June 2017, Mr. Lu applied to the district court in Beijing with a request to confirm
his shareholder identity in the Company, and such case had gone through the trials of first instance in the
district court in Beijing and the second instance in the intermediate court in Beijing, with the effective
judgment that Mr. Lu’s request was dismissed by the intermediate court in Beijing in September 2018.
Mr. Lu appealed to the high court in Beijing and his request was again dismissed by the high court in
Beijing in July 2019. Mr. Lu also applied to the People’s Procuratorate in Beijing, which was also
dismissed in December 2020. In June 2020, Ms. Yang also applied to the court in Tianjin with a request
to claim that the share transfer of the Company from Yunsi Shangde to Yunsi Shangyi in 2016 was
invalid, which was also dismissed by the intermediate court in Tianjin in December 2020. As advised by
our PRC Legal Advisors, such results of lawsuits were concluded and final.
Upon the completion of the above transfer, the shareholding structure of our Company in July
2016 was as follows:
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Dr. Kang ................................................. 580,662 3.47%
Dr. Liang ................................................. 967,770 5.79%
Heyi Guyu ................................................ 2,317,073 13.87%
Ming Fu .................................................. 2,317,073 13.87%
Yunsi Shangyi ............................................. 6,225,958 37.26%
Sky Galaxy ............................................... 91,464 0.55%
Qualcomm ................................................ 457,317 2.74%
T B PH K.................................................. 2,286,585 13.69%
Yunchuang Hudong ......................................... 973,015 5.82%
Ningbo Lianchuang ......................................... 122,856 0.73%
Ningbo Lianli ............................................. 368,566 2.21%
Total .................................................... 16,708,339 100%
Series C Financing in 2017 and 2018
We completed the Series C financing through capital increases as detailed below:
Subscribers
Registered Capital
subscribed for Consideration
(RMB) (RMB)
Beijing JD Shangke Information Technology Co., Ltd. (ࢹڦ߅֠؇
ʮ̡)( “JD Shangke” )................................. 835,417 100,000,000
Tianjin Qirui Tiancheng Equity Investment Center (Limited Partnership)
(ᛆҳ༟ʕː(Υྫ)) (“Qirui Tiancheng” )......... 501,250 60,000,000
Ningbo Yingfeng Technology Industry Investment Partnership (Limited
Partnership) (Ҧପุҳ༟ΥྫΆุ(Υྫ)) (”Yingfeng
Technology” )............................................... 250,625 30,000,000
122


--- page 132 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Subscribers
Registered Capital
subscribed for Consideration
(RMB) (RMB)
Sichuan Innovation and Venture Capital Equity Investment Fund
Partnership (Limited Partnership) (ΥྫΆ
ุ(Υྫ)) (“Sichuan Innovation” )........................... 167,084 20,000,000
CLP Healthcare Big Data (Hangzhou) Equity Investment Fund Partnership
(Limited Partnership) ( ʕཥ਄ੰᔼᐕɽᅰኽ(ψ)ΥྫΆ
ุ(Υྫ)) (“CLP Healthcare” ) ............................. 590,807 80,000,000
Ningbo Qianyi Pilot Tianquan Equity Investment Center (Limited
Partnership) (ᛆҳ༟ʕː(Υྫ)) (“Linghang
Tianquan” ) ................................................ 197,920 26,800,000
Ningbo Qianyi Pilot Tianji Equity Investment Center (Limited Partnership)
(ᛆҳ༟ʕː(Υྫ)) (“Linghang Tianji”) (
Linghang Tianquan and Linghang Tianji, together the “ Wutong
Linghang Series Funds” ) ..................................... 132,193 17,900,000
Hangzhou Haikun Jiayu Investment Partnership (Limited Partnership) (؄
ψऎ㆕ྗᚑҳ༟ΥྫΆุ(Υྫ)) (“Haikun Jiayu” ) .............. 186,843 25,300,000
Yantai Hanfu Hanfeng Investment Center (Limited Partnership) ( ๧̨ဏబ
ᖍᔮҳ༟ʕː(Υྫ)) (“Yantai Hanfu” )....................... 221,553 30,000,000
China Internet Investment Fund (Limited Partnership) ( ʕ਷ʝᑌၣҳ༟ਿ
ږ(Υྫ)) (“CII Fund” ) ................................... 1,629,335 250,000,000
Jiaxing Jiahuang Investment Partnership (Limited Partnership) (ެ
ҳ༟ΥྫΆุ(Υྫ)) (“Jiaxing Jiahuang” ) .................... 252,016 40,000,000
CICC Jiatai Phase II (Tianjin) Equity Investment Fund Partnership
(Limited Partnership) (Գइ൩ಂ(ݵ)ΥྫΆุ(Υ
ྫ)) (“CICC Jiatai” ) ......................................... 315,020 50,000,000
Upon the completion of the above subscription, the shareholding structure of our Company in
September 2018 was as follows:
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Dr. Kang ................................................. 580,662 2.6408%
Dr. Liang ................................................. 967,770 4.4013%
Heyi Guyu ................................................ 2,317,073 10.5377%
Ming Fu .................................................. 2,317,073 10.5377%
Yunsi Shangyi ............................................. 6,225,958 28.3147%
Sky Galaxy ............................................... 91,464 0.4160%
Qualcomm ................................................ 457,317 2.0798%
T B PH K.................................................. 2,286,585 10.3991%
Yunchuang Hudong ......................................... 973,015 4.4251%
Ningbo Lianchuang ......................................... 122,856 0.5587%
Ningbo Lianli ............................................. 368,566 1.6762%
JD Shangke ............................................... 835,417 3.7994%
Qirui Tiancheng ............................................ 501,250 2.2796%
Yingfeng Technology ....................................... 250,625 1.1398%
Sichuan Innovation ......................................... 167,083 0.7599%
CLP Healthcare ............................................ 590,807 2.6869%
Linghang Tianquan ......................................... 197,920 0.9001%
123


--- page 133 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Linghang Tianji ............................................ 132,193 0.6012%
Haikun Jiayu .............................................. 186,843 0.8497%
Yantai Hanfu .............................................. 221,553 1.0076%
CII Fund ................................................. 1,629,335 7.4100%
Jiaxing Jiahuang ........................................... 252,016 1.1461%
CICC Jiatai ............................................... 315,020 1.4327%
Total .................................................... 21,988,401 100%
Series D Financing in March 2019
We completed the Series D financing in March 2019 through capital transfers and capital
increases. Details of the respective capital transfers are as follows:
Transferor Transferee
Registered Capital
transferred Consideration
(RMB) (RMB)
Yantai Hanfu ............. CICC Pucheng Investment Co., Ltd. (ऌϓ
ʮ̡)( “CICC Pucheng”) 110,776.5 19,144,200
CICC Jiatai 110,776.5 19,144,200
Sky Galaxy .............. H aining Dongzheng Hande Investment
Partnership (Limited Partnership) (ᗇဏ
ᅃҳ༟ΥྫΆุ(Υྫ)) (“Dongzheng
Hande”) 15,661 2,706,747
Ningbo Meishan Bonded Port Area Dongzheng
Xiade Investment Partnership (Limited
Partnership) (
ᅃҳ༟Υ
ྫΆุ(Υྫ)) (“Dongzheng Xiade”) 15,661 2,706,747
Zhuji Dongzheng Ruiyu Investment Center
(Limited Partnership) (ҳ༟ʕ
ː(Υྫ)) (“Dongzheng Ruiyu”) 16,255 2,809,326
Nantong Dongzheng Fuxiang Equity
Investment Center (Limited Partnership) (ஷ
ᛆҳ༟ʕː(Υྫ)( “Dongzheng
Fuxiang”) 16,255 2,809,326
Shanghai Dongzheng Tengcong Investment
Partnership (Limited Partnership) (ᗇᙜ
㌾ҳ༟ΥྫΆุ(Υྫ)) (“Dongzheng
Tengcong”) 16,255 2,809,326
Zhuji Dongzheng Zhizhen Investment Center
(Limited Partnership) (ጲҳ༟ʕ
ː(Υྫ)) (“Dongzheng Zhizhen”)
(Dongzheng Hande, Dongzheng Xiade,
Dongzheng Ruiyu, Dongzheng Fuxiang,
Dongzheng Tengcong and Dongzheng Zhizhen,
together the “Dongzheng Entities”) 11,377 1,966,528
124


--- page 134 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Transferor Transferee
Registered Capital
transferred Consideration
(RMB) (RMB)
Heyi Guyu ............... Dongzheng Hande 19,814 3,424,527
Dongzheng Xiade 19,814 3,424,527
Dongzheng Ruiyu 20,565 3,554,310
Dongzheng Fuxiang 20,565 3,554,310
Dongzheng Tengcong 20,565 3,554,310
Donggzheng Zhizhen 14,396 2,488,016
Yunsi Shangyi ............ Shanghai Songyin Venture Capital Partnership
(Limited Partnership) (
ɪऎૼვ௴ุҳ༟ΥྫΆ
ุ(Υྫ) (formerly known as Shanghai
Songyin Wealth Investment Partnership
(Limited Partnership) (
ɪऎૼვৌబҳ༟ΥྫΆ
ุ(Υྫ))) (“Songyin Venture”) 59,968 15,000,000
Details of the respective capital increases are as follows:
Subscribers
Registered Capital
subscribed for Consideration
(RMB) (RMB)
Dongzheng Hande ................................................. 32,502 8,868,726
Dongzheng Xiade .................................................. 32,502 8,868,726
Dongzheng Ruiyu .................................................. 13,326 3,636,364
Dongzheng Fuxiang ................................................ 13,326 3,636,364
Dongzheng Tengcong ............................................... 13,326 3,636,364
Donggzheng Zhizhen ............................................... 9,328 2,545,456
Songyin Venture ................................................... 18,324 5,000,000
Upon the completion of the above equity transfers and subscription, the shareholding structure
of our Company in March 2019 was as follows:
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Dr. Kang ................................................. 580,662 2.6249%
Dr. Liang ................................................. 967,770 4.3749%
Heyi Guyu ................................................ 2,201,354 9.9514%
Ming Fu .................................................. 2,317,073 10.4745%
Yunsi Shangyi ............................................. 6,165,990 27.8739%
Qualcomm ................................................ 457,317 2.0673%
T B PH K.................................................. 2,286,585 10.3367%
Yunchuang Hudong ......................................... 973,015 4.3986%
Ningbo Lianchuang ......................................... 122,856 0.5554%
Ningbo Lianli ............................................. 368,566 1.6661%
JD Shangke ............................................... 835,417 3.7766%
Qirui Tiancheng ............................................ 501,250 2.2659%
Yingfeng Technology ....................................... 250,625 1.1330%
Sichuan Innovation ......................................... 167,083 0.7553%
CLP Healthcare ............................................ 590,807 2.6708%
125


--- page 135 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Shareholders Registered Capital held
Percentage of equity
interests
(RMB)
Linghang Tianquan ......................................... 197,920 0.8947%
Linghang Tianji ............................................ 132,193 0.5976%
Haikun Jiayu .............................................. 186,843 0.8446%
CII Fund ................................................. 1,629,335 7.3655%
Jiaxing Jiahuang ........................................... 252,016 1.1393%
CICC Jiatai ............................................... 425,796.5 1.9248%
CICC Pucheng ............................................. 110,776.5 0.5008%
Dongzheng Hande .......................................... 67,977 0.3073%
Dongzheng Xiade .......................................... 67,977 0.3073%
Dongzheng Ruiyu .......................................... 50,146 0.2267%
Dongzheng Fuxiang ........................................ 50,146 0.2267%
Dongzheng Tengcong ....................................... 50,146 0.2267%
Donggzheng Zhizhen ....................................... 35,101 0.1587%
Songyin Venture ........................................... 78,292 0.3539%
Total .................................................... 22,121,035 100%
Conversion into a joint stock company with limited liability in June 2019
On May 20, 2019, our Board passed resolutions approving, among other matters, the
conversion of our Company from a limited liability company into a joint stock company with limited
liability. Pursuant to the promoters’ agreement dated May 26, 2019 and the supplemental agreement
dated April 21, 2020 entered into by all the then Shareholders, all promoters approved the conversion
of the net asset value of our Company as of March 31, 2019 into 60,000,000 Shares of our Company
with a nominal value of RMB1.00 each, with the excess of the net assets converted over nominal value
of the Shares included as capital reserves of our Company. The conversion was completed in June
2019. Upon the completion of the conversion, the shareholding structure of our Company in June 2019
was as follows:
Shareholders
Number of
Shares
Percentage of
shareholding
Yunsi Shangyi ......................................................... 16,724,326 27.8739%
Ming Fu ............................................................. 6,284,714 10.4745%
T B PH K ............................................................. 6,202,020 10.3367%
Heyi Guyu ............................................................ 5,970,844 9.9514%
CII Fund ............................................................. 4,419,328 7.3655%
Yunchuang Hudong .................................................... 2,639,158 4.3986%
Dr. Liang ............................................................. 2,624,931 4.3749%
JD Shangke ........................................................... 2,265,944 3.7766%
CLP Healthcare ........................................................ 1,602,476 2.6708%
Dr. Kang ............................................................. 1,574,959 2.6249%
Qirui Tiancheng ....................................................... 1,359,566 2.2659%
Qualcomm ............................................................ 1,240,404 2.0673%
CICC Jiatai ........................................................... 1,154,909 1.9248%
Ningbo Lianli ......................................................... 999,680 1.6661%
126


--- page 136 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Shareholders
Number of
Shares
Percentage of
shareholding
Jiaxing Jiahuang ....................................................... 683,556 1.1393%
Yingfeng Technology ................................................... 679,783 1.1330%
Linghang Tianquan ..................................................... 536,828 0.8947%
Haikun Jiayu .......................................................... 506,784 0.8446%
Sichuan Innovation ..................................................... 453,188 0.7553%
Linghang Tianji ....................................................... 358,554 0.5976%
Ningbo Lianchuang .................................................... 333,229 0.5554%
CICC Pucheng ........................................................ 300,465 0.5008%
Songyin Venture ....................................................... 212,355 0.3539%
Dongzheng Hande ..................................................... 184,377 0.3073%
Dongzheng Xiade ...................................................... 184,377 0.3073%
Dongzheng Ruiyu ...................................................... 136,013 0.2267%
Dongzheng Fuxiang .................................................... 136,013 0.2267%
Dongzheng Tengcong ................................................... 136,013 0.2267%
Donggzheng Zhizhen ................................................... 95,206 0.1587%
Total ................................................................ 60,000,000 100%
Series D+ Financing in 2019
We completed the Series D+ financing through capital increases and share transfers in late
2019.
In November and December 2019, the following share subscription were effected:
Subscribers
Number Shares
Subscribed for Consideration
(RMB)
Shenzhen Huachuang No.9 Industry Investment Partnership (Limited Partnership)
(ଉέശ௴ɘ໮ପุҳ༟ΥྫΆุ(Υྫ)) (“Huachuang No. 9” ) ............ 444,150 59,220,000
Guangxi Laibin Xinlong Venture Capital Investment Co., Ltd. ( ᄿГԸႷ㒥ඤ௴ุਿ
ʮ̡)( “Laibin Xinlong” ) ................................ 150,000 20,000,000
Ji’an Jingkai District Shuizhiyan Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ))
(“Shuizhiyan” ) ..................................................... 75,000 10,000,000
Series D1 Financing in 2021
We completed the Series D1 Financing through capital increases and share transfers in 2021.
In May 2021, the following share subscription were effected:
Subscribers
Number Shares
Subscribed for Consideration
T B PH K ....................................................... 2,435,979 US$ 50,000,000
Ming Fu ....................................................... 243,598 US$ 5,000,000
Tianjin Pushu Enterprise Management Consulting Partnership (Limited
Partnership) (ዎዓΆุ၍ଣፔ༔ΥྫΆุ(Υྫ)) (“Tianjin
Pushu” ) ..................................................... 224,701 RMB 30,000,000
127


--- page 137 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
In June 2021, the following share transfer was effected:
Transferor Transferee
No. of
Shares
transferred Consideration
T B PH K ........ T B P Sound Cloud Holdings (HK) II Limited (“ TBP II HK ”) 2,435,979 0 Note
Note: TBP HK has not made payments for the 2,435,979 Shares. Pursuant to the share transfer agreement between
TBP HK and TBP II HK, TBP II HK shall assume all rights and obligations of TBP HK in relation to the 2,435,979 Shares
acquired from TBP HK, including the payment obligations.
In July 2021, the following share transfer was effected:
Transferor Transferee
No. of
Shares
transferred Consideration
Tianjin Pushu .... Tianjin Zhongguancun Pangu Turing Equity Investment Fund
Partnership (Limited Partnership) (ᛆҳ༟
Υྫ)( “Pangu Turing”) 71,904 0 Note
Note: Tianjin Pushu has not made payments for the 71,904 Shares. Pursuant to the share transfer agreement entered
into between Tianjin Pushu and Pangu Turing, Pangu Turing shall assume all rights and obligations of Tianjin Pushu in
relation to the 71,904 Shares acquired from Tianjin Pushu, including the payment obligations.
Series D2 Financing in 2022
We completed the Series D2 Financing through capital increase in 2022.
In June 2022, the following share subscription was effected:
Subscriber
Number of
Shares
subscribed for Consideration
(RMB)
Guangdong Jinhongsheng Venture Capital Partnership (Limited Partnership) (؇
Υྫ)( “Jinhongsheng VC” ) ............... 74,792 10,000,000
Upon the completion of the above subscription and share transfers, the shareholding structure
of our Company in June 2022 was as follows:
Shareholders
Number of
Shares
Percentage of
shareholding
Yunsi Shangyi ......................................................... 16,724,326 26.2762%
Ming Fu ............................................................. 6,528,312 10.2569%
T B PH K ............................................................. 6,202,020 9.7442%
Heyi Guyu ............................................................ 5,970,844 9.3810%
CII Fund ............................................................. 4,419,328 6.9434%
Yunchuang Hudong .................................................... 2,639,158 4.1465%
Dr. Liang ............................................................. 2,624,931 4.1241%
JD Shangke ........................................................... 2,265,944 3.5601%
CLP Healthcare ........................................................ 1,602,476 2.5177%
Dr. Kang ............................................................. 1,574,959 2.4745%
Qirui Tiancheng ....................................................... 1,359,566 2.1361%
Qualcomm ............................................................ 1,240,404 1.9488%
CICC Jiatai ........................................................... 1,154,909 1.8145%
Ningbo Lianli ......................................................... 999,680 1.5706%
128


--- page 138 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Shareholders
Number of
Shares
Percentage of
shareholding
Jiaxing Jiahuang ....................................................... 683,556 1.0740%
Yingfeng Technology ................................................... 679,783 1.0680%
Linghang Tianquan ..................................................... 536,828 0.8434%
Haikun Jiayu .......................................................... 506,784 0.7962%
Sichuan Innovation ..................................................... 453,188 0.7120%
Huachuang No.9 ....................................................... 444,150 0.6978%
Linghang Tianji ....................................................... 358,554 0.5633%
Ningbo Lianchuang .................................................... 333,229 0.5235%
CICC Pucheng ........................................................ 300,465 0.4721%
Songyin Venture ....................................................... 212,355 0.3336%
Dongzheng Hande ..................................................... 184,377 0.2897%
Dongzheng Xiade ...................................................... 184,377 0.2897%
Laibin Xinlong ........................................................ 150,000 0.2357%
Dongzheng Ruiyu ...................................................... 136,013 0.2137%
Dongzheng Fuxiang .................................................... 136,013 0.2137%
Dongzheng Tengcong ................................................... 136,013 0.2137%
Donggzheng Zhizhen ................................................... 95,206 0.1496%
Shuizhiyan ........................................................... 75,000 0.1178%
Tianjin Pushu ......................................................... 152,797 0.2401%
Pangu Turing ......................................................... 71,904 0.1130%
T B PI IH K............................................................ 2,435,979 3.8273%
Jinhongsheng VC ...................................................... 74,792 0.1175%
Total ................................................................ 63,648,220 100%
Series D3 Financing in 2023
We completed the Series D3 financing through capital increases and share transfers in 2023.
In April 2023, the following share subscription were effected:
Subscribers
Number of
Shares
subscribed for Consideration
(RMB)
Henan Southeast Zhanxin Industry Venture Capital Fund Partnership (Limited
Partnership) (ΥྫΆุ(Υྫ)) (“Henan
Southeast VC” ).................................................... 1,989,007 250,000,000
Jinan Tongxin Future Industrial Investment Partnership (Limited Partnership) (ی
͊Ըପุҳ༟ΥྫΆุ(Υྫ)) (“Jinan Tongxin” ) ................ 795,603 100,000,000
Tianjin Pushu ........................................................ 175,033 22,000,000
In April 2023, the following share transfers were effected:
Transferor Transferee
No. of
Shares
transferred Consideration
Yunsi Shangyi ....................... Pangu Turing 188 0 Note
Tianjin Pushu 399 0 Note
Laibin Xinlong 383 0 Note
Huachuang No.9 1,134 0 Note
Jinhongsheng VC 200 0 Note
Shuizhiyan 192 0 Note
129


--- page 139 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Transferor Transferee
No. of
Shares
transferred Consideration
Ming Fu 636 0 Note
TBP II HK 4,160 0 Note
Dr. Kang ........................... T B PI IH K 8 2 4 0 Note
Dr. Liang ........................... T B PI IH K 1,373 0 Note
Note: Each of Pangu Turing, Tianjin Pushu, Laibin Xinlong, Huachuang No.9, Jinhongsheng VC, Shuizhiyan, Ming
Fu and TBP II HK exercised their anti-dilution rights pursuant to a shareholder agreement entered into in June 2022 to
acquire Shares from Yunsi Shangyi, Dr. Kang and Dr. Liang with nil consideration.
Upon the completion of the above subscription and share transfers, the shareholding structure
of our Company in April 2023 was as follows:
Shareholders
Number of
Shares
Percentage of
shareholding
Yunsi Shangyi ......................................................... 16,717,034 25.0977%
Ming Fu ............................................................. 6,528,948 9.8021%
T B PH K ............................................................. 6,202,020 9.3112%
Heyi Guyu ............................................................ 5,970,844 8.9642%
CII Fund ............................................................. 4,419,328 6.6348%
Yunchuang Hudong .................................................... 2,639,158 3.9622%
Dr. Liang ............................................................. 2,623,558 3.9388%
JD Shangke ........................................................... 2,265,944 3.4019%
CLP Healthcare ........................................................ 1,602,476 2.4058%
Dr. Kang ............................................................. 1,574,135 2.3633%
Qirui Tiancheng ....................................................... 1,359,566 2.0411%
Qualcomm ............................................................ 1,240,404 1.8622%
CICC Jiatai ........................................................... 1,154,909 1.7339%
Ningbo Lianli ......................................................... 999,680 1.5008%
Jiaxing Jiahuang ....................................................... 683,556 1.0262%
Yingfeng Technology ................................................... 679,783 1.0206%
Linghang Tianquan ..................................................... 536,828 0.8060%
Haikun Jiayu .......................................................... 506,784 0.7608%
Sichuan Innovation ..................................................... 453,188 0.6804%
Huachuang No.9 ....................................................... 445,284 0.6685%
Linghang Tianji ....................................................... 358,554 0.5383%
Ningbo Lianchuang .................................................... 333,229 0.5003%
CICC Pucheng ........................................................ 300,465 0.4511%
Songyin Venture ....................................................... 212,355 0.3188%
Dongzheng Hande ..................................................... 184,377 0.2768%
Dongzheng Xiade ...................................................... 184,377 0.2768%
Laibin Xinlong ........................................................ 150,383 0.2258%
Dongzheng Ruiyu ...................................................... 136,013 0.2042%
Dongzheng Fuxiang .................................................... 136,013 0.2042%
Dongzheng Tengcong ................................................... 136,013 0.2042%
Donggzheng Zhizhen ................................................... 95,206 0.1429%
Shuizhiyan ........................................................... 75,192 0.1129%
Tianjin Pushu ......................................................... 328,229 0.4928%
Pangu Turing ......................................................... 72,092 0.1082%
T B PI IH K............................................................ 2,442,336 3.6667%
130


--- page 140 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Shareholders
Number of
Shares
Percentage of
shareholding
Jinhongsheng VC ...................................................... 74,992 0.1126%
Henan Southeast VC .................................................... 1,989,007 2.9861%
Jinan Tongxin ......................................................... 795,603 1.1945%
Total ................................................................ 66,607,863 100%
In May 2023, the following share subscription and share transfers were effected:
Subscribers
Number of
Shares
subscribed for Consideration
(RMB)
Deyang Digital New Town Construction and Development Co., Ltd. (۬
ʮ̡)( “Deyang Digital” ) .................................. 159,121 20,000,000
Deyang Jinghua Industrial Investment Development Co., Ltd. ( ᅃජ૆ശପุҳ༟೯
ʮ̡)( “Deyang Jinghua” ) ...................................... 636,482 80,000,000
Xinxin Xiangrong Education Technology (Beijing) Co., Ltd. (Ҧ(̏
ԯ)ʮ̡)( “Xinxin Xiangrong” ) .................................... 397,801 50,000,000
Transferer Transferee
No. of
Shares
transferred Consideration
Yunsi Shangyi ....................... Pangu Turing 71 0 Note
Tianjin Pushu 151 0 Note
Laibin Xinlong 145 0 Note
Huachuang No. 9 431 0 Note
Jinhongsheng VC 76 0 Note
Shuizhiyan 72 0 Note
Ming Fu 241 0 Note
TBP II HK 1,580 0 Note
Dr. Kang ........................... T B PI IH K 3 1 3 0 Note
Dr. Liang ........................... T B PI IH K 5 2 1 0 Note
Note: Each of Pangu Turing, Tianjin Pushu, Laibin Xinlong, Huachuang No. 9, Jinhongsheng VC, Shuizhiyan,
Ming Fu and TBP II HK pursuant to a shareholder agreement entered into in April 2023 to acquire Shares from Yunsi
Shangyi, Dr. Kang ang Dr. Liang with nil consideration.
Upon the completion of the above subscription and share transfers, the shareholding structure
of our Company was as follows:
Shareholders
Number of
Shares
Percentage of
shareholding
Yunsi Shangyi ......................................................... 16,714,267 24.6519%
Ming Fu ............................................................. 6,529,189 9.6299%
T B PH K ............................................................. 6,202,020 9.1474%
Heyi Guyu ............................................................ 5,970,844 8.8064%
CII Fund ............................................................. 4,419,328 6.5181%
Yunchuang Hudong .................................................... 2,639,158 3.8925%
Dr. Liang ............................................................. 2,623,037 3.8687%
JD Shangke ........................................................... 2,265,944 3.3420%
CLP Healthcare ........................................................ 1,602,476 2.3635%
Dr. Kang ............................................................. 1,573,822 2.3212%
Qirui Tiancheng ....................................................... 1,359,566 2.0052%
Qualcomm ............................................................ 1,240,404 1.8295%
CICC Jiatai ........................................................... 1,154,909 1.7034%
131


--- page 141 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Shareholders
Number of
Shares
Percentage of
shareholding
Ningbo Lianli ......................................................... 999,680 1.4744%
Jiaxing Jiahuang ....................................................... 683,556 1.0082%
Yingfeng Technology ................................................... 679,783 1.0026%
Linghang Tianquan ..................................................... 536,828 0.7918%
Haikun Jiayu .......................................................... 506,784 0.7475%
Sichuan Innovation ..................................................... 453,188 0.6684%
Huachuang No. 9 ...................................................... 445,715 0.6574%
Linghang Tianji ....................................................... 358,554 0.5288%
Ningbo Lianchuang .................................................... 333,229 0.4915%
CICC Pucheng ........................................................ 300,465 0.4432%
Songyin Venture ....................................................... 212,355 0.3132%
Dongzheng Hande ..................................................... 184,377 0.2719%
Dongzheng Xiade ...................................................... 184,377 0.2719%
Laibin Xinlong ........................................................ 150,528 0.2220%
Dongzheng Ruiyu ...................................................... 136,013 0.2006%
Dongzheng Fuxiang .................................................... 136,013 0.2006%
Dongzheng Tengcong ................................................... 136,013 0.2006%
Dongzheng Zhizhen .................................................... 95,206 0.1404%
Shuizhiyan ........................................................... 75,264 0.1110%
Tianjin Pushu ......................................................... 328,380 0.4843%
Pangu Turing ......................................................... 72,163 0.1064%
T B PI IH K............................................................ 2,444,750 3.6058%
Jinhongsheng VC ...................................................... 75,068 0.1107%
Henan Southeast VC .................................................... 1,989,007 2.9336%
Jinan Tongxin ......................................................... 795,603 1.1734%
Deyang Digital ........................................................ 159,121 0.2347%
Deyang Jinhua ........................................................ 636,482 0.9387%
Xinxin Xiangrong ...................................................... 397,801 0.5867%
Total ............................................................... 67,801,267 100%
Further in May 2023, Hangzhou Fuyang Yaofu Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ)) (“ Hangzhou Fuyang ”) subscribed for
1,591,206 Shares with a consideration of RMB200,000,000. In addition, the following share transfers
were effected:
Transferor Transferee
No. of
Shares
transferred Consideration
Yunsi Shangyi ....................... Ming Fu 310 0 Note
Huachuang No.9 552 0 Note
Laibing Xinlong 187 0 Note
Shuizhiyan 94 0 Note
Tianjin Pushu 194 0 Note
Pangu Turing 91 0 Note
Jinhongsheng VC 97 0 Note
TBP II HK 2,028 0 Note
Dr. Kang ........................... T B PI IH K 4 0 1 0 Note
Dr. Liang ........................... T B PI IH K 6 6 9 0 Note
Note: Each of Ming Fu, Huachuang No. 9, Laibing Xinlong, Shuizhiyan, Tianjin Pushu, Pangu Turing, Jinhongsheng
VC and TBP II HK exercised their anti-dilution rights pursuant to a shareholder agreement entered into in May 2023 to
acquire Shares from Yunsi Shangyi, Dr. Kang and Dr. Liang with nil consideration.
132


--- page 142 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Upon the completion of the above subscription and share transfers, the shareholding structure
of our Company in June 2023 was as follows:
Shareholders
Number of
Shares
Percentage of
shareholding
Yunsi Shangyi ......................................................... 16,710,714 24.0815%
Ming Fu ............................................................. 6,529,499 9.4095%
T B PH K ............................................................. 6,202,020 8.9376%
Heyi Guyu ............................................................ 5,970,844 8.6045%
CII Fund ............................................................. 4,419,328 6.3686%
Yunchuang Hudong .................................................... 2,639,158 3.8032%
Dr. Liang ............................................................. 2,622,368 3.7791%
JD Shangke ........................................................... 2,265,944 3.2654%
CLP Healthcare ........................................................ 1,602,476 2.3093%
Dr. Kang ............................................................. 1,573,421 2.2674%
Qirui Tiancheng ....................................................... 1,359,566 1.9593%
Qualcomm ............................................................ 1,240,404 1.7875%
CICC Jiatai ........................................................... 1,154,909 1.6643%
Ningbo Lianli ......................................................... 999,680 1.4406%
Jiaxing Jiahuang ....................................................... 683,556 0.9851%
Yingfeng Technology ................................................... 679,783 0.9796%
Linghang Tianquan ..................................................... 536,828 0.7736%
Haikun Jiayu .......................................................... 506,784 0.7303%
Sichuan Innovation ..................................................... 453,188 0.6531%
Huachuang No.9 ....................................................... 446,267 0.6431%
Linghang Tianji ....................................................... 358,554 0.5167%
Ningbo Lianchuang .................................................... 333,229 0.4802%
CICC Pucheng ........................................................ 300,465 0.4330%
Songyin Venture ....................................................... 212,355 0.3060%
Dongzheng Hande ..................................................... 184,377 0.2657%
Dongzheng Xiade ...................................................... 184,377 0.2657%
Laibin Xinlong ........................................................ 150,715 0.2172%
Dongzheng Ruiyu ...................................................... 136,013 0.1960%
Dongzheng Fuxiang .................................................... 136,013 0.1960%
Dongzheng Tengcong ................................................... 136,013 0.1960%
Donggzheng Zhizhen ................................................... 95,206 0.1372%
Shuizhiyan ........................................................... 75,358 0.1086%
Tianjin Pushu ......................................................... 328,574 0.4735%
Pangu Turing ......................................................... 72,254 0.1041%
T B PI IH K............................................................ 2,447,848 3.5275%
Jinhongsheng VC ...................................................... 75,165 0.1083%
Henan Southeast VC .................................................... 1,989,007 2.8663%
Jinan Tongxin ......................................................... 795,603 1.1465%
Deyang Digital ........................................................ 159,121 0.2293%
Deyang Jinghua ....................................................... 636,482 0.9172%
Xinxin Xiangrong ...................................................... 397,801 0.5733%
Hangzhou Fuyang ...................................................... 1,591,206 2.2931%
Total ................................................................ 69,392,473 100%
The Controlling Shareholders
Pursuant to a concert party agreement on May 26, 2019 and a supplemental agreement on
January 12, 2023 among Dr. Huang, Dr. Liang and Dr. Kang, they have agreed to act in concert at
meetings of our Board and the shareholders’ meetings of our Company in accordance with the
consensus achieved among them. In the event that they are unable to reach consensus on any matter
presented, the parties shall vote in accordance with the direction of Dr. Huang. As of the Latest
Practicable Date, Dr. Huang, Dr. Liang and Dr. Kang, by virtue of their acting-in-concert arrangement,
133


--- page 143 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
were collectively interested in approximately 33.93% of our total issued share capital including (i)
3.78% of our total issued share capital directly held by Dr. Liang, (ii) 24.08% and 3.80% of our total
issued share capital controlled by Dr. Huang indirectly through Yunsi Shangyi and Yunchuang
Hudong, respectively, both of which have Tianjin Yunsheng as their respective general partner, and
(iii) 2.27% of our total issued share capital directly held by Dr. Kang. Immediately following the
completion of the Global Offering (assuming the Over-allotment Option is not exercised), Dr. Liang,
Dr. Huang and Dr. Kang will, directly and indirectly through Tianjin Yunsheng, Yunchuang Hudong
and Yunsi Shangyi, continue to control in aggregate approximately 33.18% of our total issued share
capital.
Employee Incentive Schemes
To recognize the contributions of our key employees, incentivize our management team, retail
talent and promote our long-term sustainable development, our Company has adopted the 2016
Employee Incentive Scheme and the 2023 Employee Incentive Scheme. Employees who participated
in the Employee Incentive Scheme would be granted options or restricted share awards in the
Employee Incentive Platforms. See “Appendix VI – Statutory and General Information – D. Employee
Incentive Schemes”.
PREVIOUS A-SHARE LISTING ATTEMPT
To explore the opportunity of establishing a capital market platform in the A-share market, in
July 2019, we entered into a guidance agreement to receive guidance from a qualified sponsor of
A-share listing. We applied for the listing of our shares on the Shanghai Stock Exchange Star Market
ؐin November 2020 (the “ Star Market Listing Application ”) and received
one round of comments from the Shanghai Stock Exchange in December 2020 requesting further
disclosure mainly on our Company’s business, financial performance, and shareholding and
management information. Nevertheless, given the market conditions, the average time required for
approval of a listing application on the Star Market, we expected it would take an extensive period of
time for the approval process of the Star Market Listing Application. Therefore, we decided to
refocus and prioritize the time and resources to our business and technology development, with an
aim to apply for listing at a later stage with more mature business conditions and at the appropriate
market conditions, and voluntarily withdrew the Star Market Listing Application in February 2021.
Our Directors are of the view that there are no matters relating to the Star Market Listing
Application which may pose a material adverse implication on the Listing or may affect the suitability
of our Company to list the H Shares on the Stock Exchange, which should be highlighted in this
prospectus for investors to form an informed assessment of our Company. Based on the independent
due diligence conducted by the Joint Sponsors, having considered the conclusion and the basis of the
Directors, nothing has come to the attention of the Joint Sponsors that would reasonably cause the Joint
Sponsors to disagree with the Directors’ conclusion in any material respect that there are no matters
relating to the Star Market Listing Application which may pose a material adverse implication on the
Listing or may affect the suitability of the Company to list the H Shares on the Stock Exchange, which
should be highlighted in this prospectus for investors to form an informed assessment of the Company.
We are now seeking to list our H Shares in Hong Kong as we consider that the Stock Exchange
is an internationally recognized and reputable stock exchange and will therefore provide an appropriate
platform for us to introduce our business to a wider range of investors.
134


--- page 144 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
PRE-IPO INVESTMENTS
Overview
Details of the Pre-IPO Investments are set out below:
Name of
Pre-IPO
Investors
Subscription
Method
Date of
agreements
Date of
Settlement of
Consideration
Paid
Amount of
Registered
Capital
Subscribed/
Acquired
(in RMB) Consideration
Cost Per
Share
Subscribed/
Acquired(1)
Discount
to the
Offer
price(2)
Shareholding
in the
Company
upon Listing
(assuming
the Over-
allotment
Option is not
exercised)
Heyi Guyu(3) New subscription October 29,
2012 November 19,
2012
160,713(3) RMB9,000,000(4) RMB2.58(4) 107.18% 8.42%
January 21,
2013
89,287(3) RMB4,000,000(4) RMB2.06(4) 107.51%
New subscription
November 29,
2013
January 2,
2014
500,000 RMB12,333,600 RMB9.09 103.03%
Pangu
Turing
(3)
Transferred by
Tianjin Pushu
July 24, 2021 July 27, 2021 71,904 RMB9,600,000 RMB133.51 23.78% 0.10%
Transferred by
Yunsi Shangyi
April 12,
2023
N/A 188 0
(8) N/A N/A
Transferred by
Yunsi Shangyi
May 15, 2023 N/A 71 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 21, 2023 N/A 91 0 (8) N/A N/A
Ming Fu New subscription
November 29,
2013
January 2,
2014
2,000,000 US dollars
equivalent to
RMB49,334,400
RMB9.09 103.03% 8.80%
Transferred by
Heyi Guyu and
Yunsi Shangde
September 10,
2014
January 12,
2015
317,073 US$3,466,665 US$ 4.03 90.40%
New subscription May 15, 2021 June 8, 2021 243,598 US$5,000,000 US$20.53 14.98%
Transferred by
Yunsi Shangyi
April 12,
2023
N/A 636 0
(8) N/A N/A
Transferred by
Yunsi Shangyi
May 15, 2023 N/A 241 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 21, 2023 N/A 310 0 (8) N/A N/A
TBP HK New subscription
September 10,
2014
February 26,
2015
2,286,585 US$25,000,000 US$ 4.03 90.40% 8.74%
TBP II HK Transferred by
TBP HK
June 16, 2021 June 17, 2021 2,435,979 US$50,000,000 US$20.53 14.98% 3.45%
Transferred by
Yunsi Shangyi,
Dr. Kang and
Dr. Liang
April 12,
2023
N/A 6,357 0
(8) N/A N/A
Transferred by
Yunsi Shangyi,
Dr. Kang and Dr.
Liang
May 15, 2023 N/A 2,414 0
(8) N/A N/A
135


--- page 145 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Name of
Pre-IPO
Investors
Subscription
Method
Date of
agreements
Date of
Settlement of
Consideration
Paid
Amount of
Registered
Capital
Subscribed/
Acquired
(in RMB) Consideration
Cost Per
Share
Subscribed/
Acquired(1)
Discount
to the
Offer
price(2)
Shareholding
in the
Company
upon Listing
(assuming
the Over-
allotment
Option is not
exercised)
Transferred by
Yunsi Shangyi,
Dr. Kang and
Dr. Liang
May 21, 2023 N/A 3,098 0
(8) N/A N/A
Qualcomm New subscription
September 10,
2014
February 26,
2015
457,317 US$5,000,000 US$ 4.03 90.40% 1.75%
Ningbo
Lianchuang
(5)
New subscription
November 25,
2015
January 28,
2016
122,856 RMB12,500,000 RMB37.51 84.93% 0.47%
Ningbo
Lianli
(5)
New subscription
November 25,
2015
January 28,
2016
368,566 RMB37,500,000 RMB37.51 84.93% 1.41%
JD Shangke New subscription July 17, 2017 August 18,
2017
835,417 RMB100,000,000 RMB44.13 80.71% 3.19%
Qirui
Tiancheng
New subscription July 17, 2017 August 25,
2017
501,250 RMB60,000,000 RMB44.13 80.71% 1.92%
Yingfeng
Technology
New subscription July 17, 2017 September 1,
2017
250,625 RMB30,000,000 RMB44.13 80.71% 0.96%
Sichuan
Innovation
New subscription July 17, 2017 September 1,
2017
167,084 RMB20,000,000 RMB44.13 80.71% 0.64%
CLP Health
care
New subscription April 28,
2018
May 9, 2018 590,807 RMB80,000,000 RMB49.92 77.03% 2.26%
Wutong
Linghang
Series Funds
New subscription April 28,
2018
May 15, 2018 330,113 RMB44,700,000 RMB49.92 77.03% 1.26%
Haikun Jiayu New subscription April 28,
2018
May 15, 2018 186,843 RMB25,300,000 RMB49.92 77.03% 0.71%
CII Fund New subscription July 23,
2018
(6)
August 3,
2018
369,254 RMB50,000,000 RMB49.92 77.03% 6.23%
New subscription July 23,
2018
(6)
August 3,
2018
1,260,080 RMB200,000,000 RMB58.52 71.55%
Jiaxing
Jiahuang
New subscription July 23, 2018 July 31, 2018 252,016 RMB40,000,000 RMB58.52 71.55% 0.96%
CICC Jiatai
(7) New subscription July 23, 2018 August 6,
2018
315,020 RMB50,000,000 RMB58.52 71.55% 1.63%
Transferred by
Yantai Hanfu(9)
March 27,
2019
April 25,
2019
110,776.5 RMB19,144,200 RMB63.72 68.23%
CICC
Pucheng
(7)
Transferred by
Yantai Hanfu
(9)
March 27,
2019
April 9, 2019 110,776.5 RMB19,144,200 RMB63.72 68.23% 0.42%
Henan
Southeast
VC
(7)
New subscription April 12,
2023
April 21,
2023
1,989,007 RMB250,000,000 RMB125.69 28.76% 2.80%
Dongzheng
Entities
Transferred by
Sky Galaxy(9) and
Heyi Guyu
March 27,
2019
May 31, 2019 207,183 RMB35,808,000 RMB63.72 68.23% 1.23%
New subscription March 27,
2019
March 27,
2019
114,310 RMB31,192,000 RMB100.60 44.74%
136


--- page 146 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Name of
Pre-IPO
Investors
Subscription
Method
Date of
agreements
Date of
Settlement of
Consideration
Paid
Amount of
Registered
Capital
Subscribed/
Acquired
(in RMB) Consideration
Cost Per
Share
Subscribed/
Acquired(1)
Discount
to the
Offer
price(2)
Shareholding
in the
Company
upon Listing
(assuming
the Over-
allotment
Option is not
exercised)
Songyin
Venture
Transferred by
Yunsi Shangyi
March 27,
2019
March 27,
2019
59,968 RMB15,000,000 RMB92.22 50.08% 0.30%
New subscription March 27,
2019
March 27,
2019
18,324 RMB5,000,000 RMB100.60 44.74%
Huachuang
No.9
New subscription
November 14,
2019
November 18,
2019
444,150 RMB59,220,000 RMB133.33 23.89% 0.63%
Transferred by
Yunsi Shangyi
April 12,
2023
N/A 1,134 0
(8) N/A N/A
Transferred by
Yunsi Shangyi
May 15, 2023 N/A 552 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 21, 2023 N/A 552 0 (8) N/A N/A
Laibin Xinlong New subscription December 17,
2019
December 19,
2019
150,000 RMB20,000,000 RMB133.33 23.89% 0.21%
Transferred by
Yunsi Shangyi
April 12,
2023
N/A 383 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 15, 2023 N/A 145 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 21, 2023 N/A 187 0 (8) N/A N/A
Shuizhiyan New subscription December 17,
2019
December 18,
2019
75,000 RMB10,000,000 RMB133.33 23.89% 0.11%
Transferred by
Yunsi Shangyi
April 12,
2023
N/A 192 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 15, 2023 N/A 72 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 21, 2023 N/A 94 0 (8) N/A N/A
Tianjin Pushu New subscription May 15, 2021 July 19, 2021 152,797 RMB20,400,000 RMB133.51 23.76% 0.46%
New subscription April 12,
2023
April 6, 2023 175,033 RMB22,000,000 RMB125.69 28.76%
Transferred by
Yunsi Shangyi
April 12,
2023
N/A 399 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 15, 2023 N/A 151 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 21, 2023 N/A 194 0 (8) N/A N/A
Jinhongsheng
VC
New subscription June 9, 2022 June 20, 2022 74,792 RMB10,000,000 RMB133.70 23.66% 0.11%
Transferred by
Yunsi Shangyi
April 12,
2023
N/A 200 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 15, 2023 N/A 76 0 (8) N/A N/A
Transferred by
Yunsi Shangyi
May 21, 2023 N/A 97 0 (8) N/A N/A
Jinan Tongxin New subscription April 12,
2023
April 25,
2023
795,603 RMB100,000,000 RMB125.69 28.76% 1.12%
Deyang Digital New Subscription May 15, 2023 May 15, 2023 159,121 RMB20,000,000 RMB125.69 28.76% 0.22%
137


--- page 147 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Name of
Pre-IPO
Investors
Subscription
Method
Date of
agreements
Date of
Settlement of
Consideration
Paid
Amount of
Registered
Capital
Subscribed/
Acquired
(in RMB) Consideration
Cost Per
Share
Subscribed/
Acquired(1)
Discount
to the
Offer
price(2)
Shareholding
in the
Company
upon Listing
(assuming
the Over-
allotment
Option is not
exercised)
Deyang Jinghua New Subscription May 15, 2023 May 16, 2023 636,482 RMB80,000,000 RMB125.69 28.76% 0.90%
Xinxin
Xiangrong
New Subscription May 15, 2023 June 6, 2023 397,801 RMB50,000,000 RMB125.69 28.76% 0.56%
Hangzhou
Fuyang
New Subscription May 21, 2023 June 2, 2023 1,591,206 RMB200,000,000 RMB125.69 28.76% 2.24%
Notes:
(1) The cost per Share is calculated based on dividing the consideration by the number of Shares subscribed or acquired taking into
consideration the capital increase resulted from the capital reserve conversion. In April 2013, the registered capital of our Company was
increased from RMB1,250,000 to RMB10,000,000 through conversion of capital reserve as approved by the shareholders meeting. In June
2019, our Company was converted into a joint stock company and our registered capital was increased to RMB60,000,000.
(2) The discount to the Offer Price is calculated based on the assumption that the Offer Price is HK$185.00 per Offer Share, being the
mid-point of the indicative Offer Price range of HK$165.00 and HK205.00.
(3) The general partner of Heyi Guyu is Mr. Sun Ge (
ˑ). The general partner of Pangu Turing is Beijing Pangu Venture Investment Co.,
Ltd. (ப΂ʮ̡)( “Pangu Venture”), which is owned as to 99% by Mr. Sun Ge.
(4) Heyi Guyu subscribed a registered capital of RMB160,713 with a consideration of RMB9,000,000 in October 2012. Pursuant to the share
subscription agreement dated October 25, 2012, Heyi Guyu was entitled to right of additional subscription so that it could hold 20% of
equity interests in our Company. Heyi Guyu exercised its right of subscription in January 2013 and subscribed for additional registered
capital of RMB89,287 with a consideration of RMB4,000,000.
(5) The general partner of Ningbo Lianchuang and Ningbo Lianli is Zhejang University Collaboration Innovation Investment Management
Partnership (Limited Partnership) (
Υྫ)( “Zhejiang Collaboration”).
(6) CII Fund entered into share subscription agreements as a series C+ investor and a series C3 investor on July 23, 2018.
(7) CICC Jiatai and CICC Pucheng are ultimately controlled by China International Capital Corporation Limited (“ CICC”). Henan Southeast
VC is ultimately owned by Henan Investment Group Huirong Fund Management Co., Ltd. (
ʮ̡)( “Henan
Investment Group”) and CICC as to 50% and 50%, respectively.
(8) Each of Pangu Turing, Tianjin Pushu, Laibin Xinlong, Huachuang No.9, Jinhongsheng VC, Shuizhiyan, Ming Fu and TBP II HK
exercised their anti-dilution rights pursuant to then effective shareholders agreement to acquire Shares from Yunsi Shangyi, Dr. Kang and
Dr. Liang with nil consideration.
(9) Yantai Hanfu and Sky Galaxy were Independent Third Parties.
Principal terms of the Pre-IPO Investments and Pre-IPO Investors’ rights
Use of proceeds from the Pre-IPO
Investments
We utilized the proceeds from the Pre-IPO Investments for the
principal business of our Group, including but not limited to research
and development activities, the growth and expansion of our
Company’s business and general working capital purposes. As of the
Latest Practicable Date, all of the net proceeds from the Pre-IPO
Investments had been fully utilized.
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-IPO Investors’ investments in our Company and their
knowledge and experience.
Basis of determining the consideration
paid
The consideration for the Pre-IPO investments was determined based
on arm’s length negotiations between the Company and the Pre-IPO
Investors, taking into account the timing of the investments and the
status of our business and operating entities.
Lock-up period Pursuant to the applicable PRC law, all current Shareholders (including
the Pre-IPO Investors) are subject to the relevant PRC statutory transfer
restriction for a period of one year from the Listing Date.
138


--- page 148 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Special rights of the Pre-IPO Investors
Pursuant to the Shareholders Agreement, the Pre-IPO Investors had been granted certain special
rights, including, among others, (i) pre-emptive right, (ii) right of first refusal and co-sale, (iii) anti-
dilution rights, (iv) redemption rights, (v) liquidation preferences, and (vi) most favorable treatment.
Pursuant to the Shareholder Agreement, all the special rights of the Pre-IPO Investors shall cease to be
effective when the Company submits its listing application to the Stock Exchange, provided that such
special rights shall resume automatically in the event that (i) the listing application has been withdrawn
by or on behalf of the Company; or (ii) the Listing does not take place within 30 months following the
Company’s listing application other than governmental restrictions or within six months following the
grant of the listing approval by the Stock Exchange.
Compliance with interim guidance and guidance letter
On the basis that (i) the considerations for the Pre-IPO Investments are irrevocably settled more
than 28 clear days before the Company’s listing application, (ii) the special rights granted to the Pre-IPO
Investors ceased to be effective when the Company submitted its first listing application to the Stock
Exchange, the Joint Sponsors confirm that the Pre-IPO Investments are in compliance with Chapter 4.2
under the Guide for New Listing Applicants issued by the Stock Exchange.
Information relating to our principal Pre-IPO Investors
Set out below is a description of our Pre-IPO Investors.
Ming Fu
Ming Fu is a company established under the laws of Hong Kong, which is held as to 96.94% by
Qiming Venture Partners III, L.P., whose general partner is Qiming GP III, L.P. the general partner of
which is Qiming Corporate GP III, Ltd, an exempted company incorporated in the Cayman Islands
which is an Independent Third Party, while the remaining 3.06% was held by Qiming Managing
Directors Fund III, L.P. Qiming Venture Partners III, L.P. is a venture capital fund operated under
Qiming Venture Partners focusing on investments in companies in the technology and consumer (T&C)
and healthcare sectors across China.
TBP Entities
TBP HK is a company established under the laws of Hong Kong, and TBP II HK is a company
established under the laws of Hong Kong, both of which are investment entities of Trustbridge Partners.
Except for being a substantial Shareholder of our Company, Trustbridge Partners is independent from
the Group.
Heyi Guyu and Pangu Turing
Heyi Guyu is a limited partnership established under the laws of the PRC on July 18, 2011.
Mr. Sun Ge (
ˑ) is the general partner of Heyi Guyu with 99% limited partnership interest. Pangu
Turing is a limited partnership established under the laws of the PRC on February 28, 2019. The general
partner of Pangu Turing is Pangu Venture, which is owned as to 99% by Mr. Sun Ge (
ˑ). The limited
partners of Pangu Turing with 10% or more partnership interest include Mr. Sun Ge with 56%
partnership interest, Beijing Zhongguancun Collaborative Innovation Investment Fund (Limited
139


--- page 149 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Partnership) (ږ(Υྫ)) with 23% partnership interest, and Tianjin
Technology Innovation Center (ʕː) with 19% partnership interest, both being
Independent Third Parties.
CII Fund
CII Fund is a limited partnership established under the laws of the PRC on March 23, 2017. Its
general partner is China Internet Investment Fund Management Co., Ltd. (၍ଣϞ
ʮ̡), which is ultimately held as to 40% by CNCERT (τΌ၍ଣʕː), an
Independent Third Party. The limited partners of CII Fund with 10% or more partnership interest
include ICBC Credit Suisse Investment Management Co., Ltd. (
ʮ̡) with 33%
partnership interest, Agricultural Bank Huili Asset Management Co., Ltd. ( 䕀䟒߸ଣሧӁʮ̡)
with 17% partnership interest and China Post Life Insurance Co., Ltd. (ʮ̡)
with 20% partnership interest, all being Independent Third Parties.
JD Shangke
JD Shangke is a limited company established under the laws of the PRC on March 13, 2012,
which is wholly owned by Beijing Jingdong Century Trade Co., Ltd. (ʮ̡), a
wholly-owned subsidiary of JD.com, Inc., a company listed on the Nasdaq under the symbol “JD” and
on the Stock Exchange (stock code: 9618) and an Independent Third Party.
CLP Healthcare
CLP Healthcare is a limited partnership established under the laws of the PRC on September 7, 2017.
Its general partner is Hangzhou Shurong Shufeng Investment Management Partnership (Limited Partnership)
(ψᅰፄᅰ㋘ҳ༟၍ଣΥྫΆุ(Υྫ)) (formerly known as Hangzhou CLP Shufeng Investment
Management Partnership (Limited Partnership) (ψʕཥᅰ㋘ҳ༟၍ଣΥྫΆุ(Υྫ))), whose general
partner is Shurong Shuke (Beijing) Private Equity Fund Management Co., Ltd. (߅(̏ԯ)၍
ʮ̡) (formerly known as CLP Digital Finance Investment Management (Hangzhou) Co., Ltd. (ʕཥᅰ
ፄҳ༟၍ଣ(ψ)ʮ̡)), which is held as to 21% by China Electric Data Services Co., Ltd. (ਕ
ʮ̡), whose largest shareholder is China Electronics Co., Ltd. (ʮ̡) with 34.29% equity
interest, which is ultimately held by China Electronics Corporation (ʮ̡), a state-
owned enterprise and an Independent Third Party. The limited partners of CLP Healthcare with 10% or more
partnership interest include Xiamen Orange Blue Star Investment Co., Ltd. (
ʮ̡) with
27% partnership interest, Hainan Qianyuan Lizhen H ealth Industry Investment Partnership (Limited
Partnership) (਄ੰପุҳ༟ΥྫΆุ(Υྫ)) with 16% partnership interest, Ruidian
Investment Management Co., Ltd. (ʮ̡) with 15% partnership interest, Hainan Zhongjing
Jiucheng Health Industry Investment Partnership (Limited Partnership) (ʕԯӯ༐਄ੰପุҳ༟ΥྫΆ
ุ(Υྫ)) with 14% partnership interest, Beijing Shengshi Zhuoyou Investment Co., Ltd. (̏ԯସ˰ՙᎴҳ
ʮ̡) with 13% partnership interest and Zheng Sisi (ܠܠwith 11% partnership interest, all being
Independent Third Parties.
CICC Jiatai, CICC Pucheng and Henan Southeast VC
CICC Jiatai is a limited partnership established under the laws of the PRC on March 8, 2016,
whose general partner is CICC Capital Management Co., Ltd. (ʮ̡)( “ CICC
Capital”). CICC Pucheng is a limited company established under the laws of the PRC on April 10,
140


--- page 150 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
2012. Both CICC Capital and CICC Pucheng are wholly owned by CICC, a company listed on the
Shanghai Stock Exchange (stock code: 601995) and the Stock Exchange (stock code: 3908) and an
Independent Third Party.
Henan Southeast VC is a limited partnership established under the laws of the PRC on
November 14, 2022. Its general partner is Henan CICC Huirong Private Equity Fund Management Co.,
Ltd. (
ʮ̡), which is held as to 50% by Henan Investment Group, a
state-owned enterprise and an Independent Third Party, and the remaining 50% by CICC Capital. The
limited partners of Henan Southeast VC with 10% or more partnership interest include Henan
Southeast Industrial Development Center (Limited Partnership) (
ପุක೯ʕː(Υྫ))
with 45% partnership interest, Xinyang Huaxin Investment Group Co., Ltd. (ʮ
̡) with 35% partnership interest, and Xinyang Dingxin Industrial Investment Group Co., Ltd. (ජཻ
ʮ̡) with 20% partnership interest, all being Independent Third Parties.
Wutong Linghang Series Funds
Linghang Tianji is a limited partnership established under the laws of the PRC on March 5,
2018. Linghang Tianquan is a limited partnership established under the laws of the PRC on March 9,
2018. The general partner of Linghang Tianji with 7% limited partnership interest and Linghang Ti
anquan with 3% limited partnership interest is Zhuhai Wutong Linghang Investment Management Co.,
Ltd. (
ʮ̡)( “Wutong Linghang”), a limited company established under the
laws of the PRC on January 21, 2016. It is owned as to 66% by Beijing Linghang Business
Management Co., Ltd. (
ʮ̡), which is held as to 99% by Wang Yan, an
Independent Third Party. The limited partner of Linghang Tianji is Baihe No. 5 (Shenzhen) Investment
Partnership (Limited Partnership) (
ϵձʞ໮(ଉέ)ҳ༟ΥྫΆุ(Υྫ)) with 93% limited
partnership interest, being an Independent Third Party. The sole limited partner of Linghang Tianquan
is Shenzhen Zhanxiang Information Technology (
ʮ̡) with 97% limited
partnership interest, being in Independent Third Party.
Ningbo Lianchuang and Ningbo Lianli
Ningbo Lianchuang is a limited partnership established under the laws of the PRC on
February 13, 2015, and Ningbo Lianli is a limited partnership established under the laws of the PRC on
June 4, 2015. The general partner of Ningbo Lianchuang and Ningbo Lianli is Zhejiang Collaboration,
which is ultimately owned by Lin Guang, an Independent Third Party. The limited partners of Ningbo
Lianchuang with 10% or more partnership interest include Zhejiang University Innovation Technic
Institute Co., Ltd. (
ʮ̡), Zhejiang Shuanghuan Driveline Co., Ltd. ( एϪ
ʮ̡) and Zhejiang Crystal-Optech Co., Ltd. (ʮ̡),
each being Independent Third Parties with 20% partnership interest. The limited partners of Ningbo
Lianli with 10% or more partnership interest include Lin Guang (
Έ) with 19% partnership interest,
Lin Lvxin (ѐ㒥) with 13% partnership interest, and Cheng Weihai ( ೻ሊऎ) with 10% partnership
interest, all being Independent Third Parties.
Qirui Tiancheng
Qirui Tiancheng is a limited partnership established under the laws of the PRC on September 25,
2015, which is held as to 90% by Beijing Qifutong Technology Co., Ltd. (ʮ̡), a
wholly-owned company of 360 Security Technology Inc. (ʮ̡), a company listed
on the Shanghai Stock Exchange (stock code: 601360) and an Independent Third Party.
141


--- page 151 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Qualcomm
Qualcomm is a company established under the laws of California on December 8, 1993, which
is wholly owned by Qualcomm Technologies, Inc., a company wholly owned by QUALCOMM
Incorporated, a company listed on the Nasdaq (stock code: QCOM) and an Independent Third Party.
Dongzheng Entities
Dongzheng Hande is a limited partnership established under the laws of the PRC on March 22,
2017. Other limited partner of Dongzheng Hande with 10% or more partnership interest includes
Ningbo Aux Investment Co., Ltd. (
ʮ̡)( “ Ningbo Aux ”) with 44%
partnership interest, being an Independent Third Party.
Dongzheng Xiade is a limited partnership established under the laws of the PRC on February
11, 2018. Other limited partners of Dongzheng Xiade with 10% or more partnership interest include
Ningbo Aux with 22% partnership interest, Xuan Jian Gang (
፻) with 14% partnership interest,
Zhang Yuxin ( ੵρ㒥) with 13% partnership interest, and Shenzhen Zhuoyue Venture Investment Co.,
Ltd. (ப΂ʮ̡) with 11% partnership interest, all being Independent Third
Parties.
Dongzheng Ruiyu is a limited partnership established under the laws of the PRC on
December 26, 2016. Other limited partner of Dongzheng Ruiyu with 10% or more partnership interest
includes Jiangsu King’s Luck Brewery Joint-Stock Co., Ltd. (
ʮ̡) with 33%
partnership interest, being an Independent Third Party.
Dongzheng Fuxiang is a limited partnership established under the laws of the PRC on
November 7, 2017. The limited partners of Dongzheng Fuxiang with 10% or more partnership interest
include Zhu Qi (
ϡೡ) with 20% partnership interest, Nantong Jianghai Industrial Development
Investment Fund (Limited Partnership) (ږ(Υྫ)) with 17% partnership
interest, Luo Xiaowei ( ᖯወ⑸) with 14% partnership interest and Zhang Minhua ( ੵઽശ) with 10%
partnership interest, all being Independent Third Parties.
Dongzheng Tengcong is a limited partnership established under the laws of the PRC on April 8,
2016. The limited partners of Dongzheng Tengcong with 10% or more partnership interest include
Qushui Tengjun Enterprise Management Co., Ltd. (
ʮ̡) with 17% partnership
interest, and each of Zhao Anchang (׹Wang Kanglin (؍Yang Xiaoling (ޛHe Hu
(ډand Shanghai Shenneng Chengyi Equity Investment Co., Ltd. (ʮ̡)
with 10% partnership interest, all being Independent Third Parties.
Dongzheng Zhizhen is a limited partnership established under the laws of the PRC on March 7,
2017. The limited partner of Dongzheng Zhizhen with 10% or more partnership interest includes Li
Huacheng (
ҽശϓ) with 10% partnership interest, an Independent Third Party.
The general partner of each of Dongzhen Hande, Dongzheng Xiade, Dongzheng Ruiyu,
Dongzheng Fuxiang, Dongzheng Tengcong and Dongzheng Zhizhen is Shanghai Orient Securities
Capital Investment Co., Ltd. (
ʮ̡), which is wholly owned by Orient
Securities Company Limited (ʮ̡), a company listed on the Shanghai Stock
Exchange (stock code: 600958) and the Stock Exchange (stock code: 3958) and an Independent Third
Party.
142


--- page 152 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Jinan Tongxin
Jinan Tongxin is a limited partnership established under the laws of the PRC on March 23,
2023. Its general partner is Shandong Tongxin Tongtai Private Equity Fund Management Co., Ltd. ( ʆ
ʮ̡), which is wholly owned by Jinan Licheng Holding Group Co., Ltd.
(ʮ̡) (“Jinan Licheng”). The sole limited partner of Jinan Tongxin is Jinan
Licheng Holding Industry Investment Group Co., Ltd. (ʮ̡) which is
wholly owned by Jinan Licheng. Jinan Licheng is a state-owned enterprise and an Independent Third
Party.
Hangzhou Fuyang
Hangzhou Fuyang is a limited partnership established under the laws of the PRC on
December 29, 2022. Its general partner is Hangzhou Fuyang Futoufa Asset Management Co., Ltd. (
؄
ʮ̡), a state-owned enterprise and an Independent Third Party. The sole
limited partner of Hangzhou Fuyang is Hangzhou Fuyang Industrial Fund Investment Management
Co., Ltd. (
ʮ̡), a state-owned enterprise and an Independent Third
Party.
Jiaxing Jiahuang
Jiaxing Jiahuang is a limited partnership established under the laws of the PRC on April 10,
2018. Its general partner is JIC Capital Management (Tianjin) Limited (৘(ݵ)ʮ
̡), a state-owned enterprise. The limited partners of Jiaxing Jiahuang with 10% or more partnership
interest include Beijing Aotongda Energy Saving Environment Protection Technological Development
Center (
ༀᇏྏ) with 83% partnership interest, and Huzhou Yinghao Investment
Partnership (Limited Partnership) (Ď) with 13% partnership interest,
both of which are Independent Third Parties.
Yingfeng Technology
Yingfeng Technology is a limited partnership established under the laws of the PRC on
June 30, 2017. Its general partner is Ningbo Yingfeng Equity Investment Fund Management Co., Ltd.
(
ඳ) which is ultimately wholly owned by Infore Group Co., Ltd. (ޮ
ʮ̡), which is in turn owned as to 88% by He Jianfeng (ڃࡴޅIts sole limited partner
with 99.9% partnership interest is Ningbo Poluofei Investment Management Co., Ltd. (๧ሧ
ඳ) which is wholly owned by Meidi Holding Co., Ltd. (ʮ̡), an Independent
Third Party.
Deyang Digital and Deyang Jinghua
Deyang Digital is a limited company established under the laws of the PRC on July 9, 2021,
which is wholly owned by Deyang Jingshang Forestry Technology Co., Ltd. (ࠢ
ʮ̡), a state-owned enterprise.
Deyang Jinghua is a limited company established under the laws of the PRC on August 28,
2017, which is wholly owned by Deyang Investment Holding Group Co., Ltd. (๶Ⴕཋ
ඳ), a state-owned enterprise.
143


--- page 153 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Haikun Jiayu
Haikun Jiayu is a limited partnership established under the laws of the PRC on January 9, 2018.
Its general partner is Haikun Investment Management (Shanghai) Co., Ltd. (ĎႵཋ
ඳ) which is wholly owned by He Huojian (ࡰࠅޏan Independent Third Party. The limited
partners of Haikun Jiayu with 10% or more partnership interest include Hangzhou Haikun Jiazheng
Investment Partnership (Limited Partnership) (
Ď) with 89%
partnership interest, and Hangzhou Haikun Jiahe Investment Partnership (Limited Partnership) (ݚ
Ď) with 11% partnership interest, whose general partner are both
Haikun Investment Management (Shanghai) Co., Ltd.
Sichuan Innovation
Sichuan Innovation is a limited partnership established under the laws of the PRC on
December 29, 2015. Its general partner is Sichuan Innovation Development Investment Management
Co., Ltd. (
ඳ), a state-owned enterprise. All of the four limited partners of
Sichuan Innovation are state-owned enterprises.
Huachuang No. 9
Huachuang No. 9 is a limited partnership established under the laws of the PRC on April 23,
2018. Its general partner is Shenzhen Qianhai Zhongzhong Equity Investment Co., Ltd. (ऎʕ䧓
ٰಃҳሧʮ̡), which is ultimately owned as to 88% by Huang Xiaomian (ۈan Independent
Third Party. The limited partners of Huachuang No. 9 with 10% or more partnership interest include
Qu Jiawen (
ϜԳ˖) with 17% partnership interest, Huang Hongsheng (͛) with 16% partnership
interest, Xiamen Peony Development Investment Co., Ltd. (ҳሧʮ̡) with 16%
partnership interest, and Zhao Haisen ( ᅵऎಌ) with 13% partnership interest, all of which are
Independent Third Parties.
Xinxin Xiangrong
Xinxin Xiangrong is a limited company established under the laws of the PRC on June 23,
2015. It is wholly owned by Beijing Ke Le Tang Technology Co., Ltd. ( ̏ԯ̙ুʮ̡)
which is controlled by Beijing Chuzhi Consulting Management Co., Ltd. (ʮ̡),
an Independent Third Party.
Tianjin Pushu
Tianjin Pushu is a limited partnership established under the laws of the PRC on May 10, 2021.
Its general partner is Li Zhichao ( ҽқ൴), our non-executive Director. The limited partners of Tianjin
Pushu with 10% or more partnership interest include Wang Yonghui ( ˮ͑ߩwith 70% partnership
interest, Xu Qiang ( ྸ䅎) with 12% partnership interest, both are Independent Third Parties, and Sun
Ge (ۥwith 11% partnership interest, who also held interest in Heyi Guyu and Pangu Turing.
Songyin Venture
Songyin Venture is a limited partnership established under the laws of the PRC on May 12,
2015. Its general partner is Shanghai Songyin Wealth Asset Management Co., Ltd. (ږ
ʮ̡), an Independent Third Party. Its sole limited partner with 99.9% partnership interest is
Lin Chanzhen ( ਟយᆋ), an Independent Third Party.
144


--- page 154 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Laibin Xinlong
Laibin Xinlong is a limited company established under the laws of the PRC on April 14, 2016,
whose two shareholders, Guangxi Laibin Hengda Investment Management Co., Ltd. (ղ๧
ඳ) and Guangxi Laibin Finance Investment Group Co., Ltd. (๶Ⴕཋ
ඳ), each holding 50% equity interest in Laibin Xinlong, are all state-owned enterprises.
Shuizhiyan
Shuizhiyan is a limited partnership established under the laws of the PRC on September 11,
2017. Its general partner is Watere Capital Management Co., Ltd. (݆ሧʮ̡), which
is owned as to 76% by Mizuki Wealth (Beijing) Asset Management Co., Ltd. ( ˥˝ҍబ(̏ԯ)ሧӁ၍ଣ
ʮ̡), an Independent Third Party. The limited partners of Shuizhiyan with 10% or more
partnership interest include Mumeng Technology Group Co., Ltd. (ʮ̡) with 65%
partnership interest and Bai Lingling (ޛޛwith 15% partnership interest, both being Independent
Third Parties.
Jinhongsheng VC
Jinhognsheng VC is a limited partnership established under the laws of the PRC on February 1,
2021. Its general partner is Guangzhou Jinda Investment Fund Management Co., Ltd. (䣆ҳሧਿ
ʮ̡) which is ultimately owned as to 90% by Liang Tongcan (䚓). Its sole limited
partner with 99.9% partnership interest is Guangdong Hongyu Group Co., Ltd. (ʮ
̡), an Independent Third Party.
MAJOR ACQUISITION, DISPOSALS AND MERGERS
Fujian Unisound was established on January 7, 2021 and held as to 51%, 25% and 24% by our
Company and two other shareholders, respectively. Since its establishment, Fujian Unisound has been
our subsidiary. In May 2023, our Company acquired 24% equity interest of Fujian Unisound from one
of the shareholders (the “ Original Shareholder ”) with a consideration of RMB480,000 (the
“Minority Interest Acquisition ”) which was determined based on arms’ length negotiations between
the Company and the Original Shareholder. The Minority Interest Acquisition was completed in May
2023. Upon the completion of the Minority Interest Acquisition, Fujian Unisound was held as to 75%
and 25% by our Company and Sinosure Energy Technology Co., Ltd. (
ʮ̡),
respectively.
During the Track Record Period and up to the Latest Practicable Date, we have not made any
acquisitions, disposals or mergers that we consider to be material to us.
PUBLIC FLOAT
The 24,995,061 Domestic Unlisted Shares and 4,570,649 Unlisted Foreign Shares that will not
be converted into H Shares (collectively representing approximately 41.67% 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 these Shares will not be converted into H Shares and will not be listed following the
completion of the Global Offering.
145


--- page 155 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Of the 27,977,641 H Shares, representing approximately 39.43% of our total issued Shares
upon Listing (assuming that the Over-allotment Option is not exercised), to be converted from
Domestic Unlisted Shares and listed on the Stock Exchange following the completion of the Global
Offering:
(a) 20,761,847 H Shares, representing approximately 29.26% of our total issued Shares upon
Listing (assuming that the Over-allotment Option is not exercised) will be counted towards
the public float for the purpose of Rule 8.08 of the Listing Rules after the Listing as such
remaining shareholders are not core connected persons of our Company upon Listing nor
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
(b) 7,215,794 H Shares, representing approximately 10.17% of our total issued Shares upon
Listing (assuming that 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 being held by our Controlling Shareholders and Tianjin Pushu whose
general partner is Mr. Li Zhichao, our non-executive Director.
Further, of the 11,849,122 H Shares, representing approximately 16.70% of our total issued Shares
upon Listing (assuming the Over-allotment Option is not exercised), to be converted from Unlisted Foreign
Shares and listed on the Stock Exchange following the completion of the Global Offering:
(a) 3,199,254 H Shares, representing approximately 4.51% of our total issued Shares upon
Listing (assuming that the Over-allotment Option is not exercised) 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, are not
accustomed to take instructions from core connected persons in relation to the acquisition,
disposal, voting or other disposition of their Shares and their acquisition of Shares were
not financed directly or indirectly by core connected persons;
(b) 8,649,868 H Shares (representing approximately 12.19% of our total issued Shares upon
Listing assuming that 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 being held by TBP and TBP II HK, our substantial Shareholders.
Therefore, 28,785,181 H Shares comprising 20,761,847 H Shares converted from Domestic
Unlisted Shares, 3,199,254 H Shares converted from Unlisted Foreign Shares and 1,560,980 H Shares to
be issued pursuant to the Global Offering, representing approximately 35.97% of our total issued Shares
upon Listing (assuming the Over-allotment Option is not exercised and the H Shares to be issued
pursuant to the Global Offering will not be held by any core connected person of the Company), will be
counted towards the public float of our Company according to Rule 8.08 of the Listing Rules.
146


--- page 156 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
CORPORATE STRUCTURE
Corporate Structure before 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:
Note:
(1) For details of the Pre-IPO Investors, see “- Pre-IPO Investment” under this section.
(2) The remaining 35% equity interest of Guangxi Guiyuntong Technology Co., Ltd. (
ʮ̡) was owned by Nanning Rail
Technology Innovation Investment Co., Ltd. (ʮ̡), an Independent Third Party.
(3) The remaining 49% equity interest of Yunmao Internet Intelligent Technology (Xiamen) Co., Ltd. (ʮ̡)
was owned by Shanghai Shibin e-commerce Co., Ltd. (ʮ̡), which is owned by Shimao Group Holdings Limited
(ʮ̡).
(4) The remaining 25% equity interest of Fujian Unisound was owned by Sinosure Energy Technology Co., Ltd. (ʮ̡), an
Independent Third Party.
(5) The general partner of Yunsi Shangyi is Tianjin Yunsheng with 0.1% partnership interest, which is held as to 99% by Dr. Huang and 1%
by Mr. Liu Shengping, our executive Director. The limited partners of Yunsi Shangyi include Dr. Huang with 82.6% partnership interest,
and Yunsi Shangzhi, one of our Employee Incentive Platforms, as to 17.3%. Therefore, Yunsi Shangyi is controlled by Dr. Huang.
(6) The general partner of Yunchuang Hudong is Tianjin Yunsheng. The limited partners of Yunchuang Hudong include Dr. Huang with
41.9% partnership interest, Yunsi Shangxin, one of our Employee Incentive Platforms whose general partner is Tianjin Yunsheng, with
42.4% partnership interest, and an employee of the Company and an Independent Third Party with 15.7% partnership interest. Therefore,
Yunchuang Hudong is controlled by Dr. Huang.
(7) The remaining 40% equity interest of Jiangsu Unisound Shanhai Technology Co., Ltd. was owned by Yunminyi Information Consulting
Services (Nanjing) Partnership Enterprise (Limited Partnership) (
Υྫ), an Independent
Third Party.
147


--- page 157 ---
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
Corporate Structure immediately following the Global Offering
The chart below sets out the shareholding structure of our Company immediately following the
completion of the Global Offering (assuming the Over-allotment Option is not exercised):
Notes (1) to (7): Please refer to the shareholding and corporate structure immediately prior to the completion of the Global Offering.
148


--- page 158 ---
BUSINESS
OVERVIEW
Who We Are
We are an AI company solution provider focusing on the sales of conversational AI products
and solutions for daily life and healthcare related application scenarios in China. Our business centers
on empowering customers across various industries with user-centric AI solutions that improve
operational efficiency, enhance decision-making and deliver better outcomes. These solutions are built
on our proprietary central technology platform, UniBrain, which serves as the foundation of a wide
range of applications, from intelligent customer service and healthcare diagnostics to multilingual
conversational assistants. Our technology leverages continuous human interaction to refine its
capabilities. In 2023, we introduced UniGPT, a 60 billion-parameter large language model with
generative multilingual and multimodal capabilities, which enables human-machine interaction through
dynamic reasoning and cross-modal data processing. Supported by our Atlas AI infrastructure, we
ensure efficient model training and deployment, driving iteration and industry-specific adaptation.
We have offered products and solutions for a broad range of application scenarios. China’s AI
solution market is highly fragmented. According to Frost & Sullivan, we remained the fourth largest
AI solution provider by revenue with a market share of 0.6% in China in each year of the Track Record
Period, yet recording a high growth rate among those with annual revenues over RMB500 million.
While the market size of AI solution in China increased by 33.1% from RMB135.5 billion in 2023 to
RMB180.4 billion in 2024, our revenue increased by 29.1% from from RMB727.3 million in 2023 to
RMB939.0 million in 2024. In 2024, we ranked third by revenue in AI Solution in Daily Life and
fourth in AI Solution in Healthcare in China. Extensive commercial application of these products and
solutions has provided us with high-quality user feedback, which, in turn, prompting incessant
iterations of UniGPT as the core of UniBrain.
The diagram below illustrates the Atlas AI infrastructure, UniBrain and the AI application
solutions, which are respectively the foundational layer, the central technology platform layer and the
application layer that, together, form the technology stack of our AI solutions.
Atlas
AI Infrastructure
Intelligent
Computing Cluster
Machine Learning
Algorithms
Data-centric
Training
UniBrain
AI
Application
Solutions
Daily Life Healthcare …
UniGPT
AI
Components
Plug-in
Extension
Unsupervised
Pre-training
Feedback
Reinforcement
Instruction
Fine-Tuning
Multimodal
Language
Knowledge
Reasoning
… …
149


--- page 159 ---
BUSINESS
Atlas AI Infrastructure
Our Atlas AI Infrastructure is the foundational layer that consists of the hardware and software
resources which enable computing, storage, connectivity, scheduling and management. It supports the
development, optimization and operation of the central technology platform, UniBrain, as well as
UniBrain’s core algorithm model, UniGPT. We strategically started building the Atlas AI
infrastructure in 2016, which centers on our intelligent computing cluster, dynamically scheduling
strong computing power for efficient machine task learning tasks. Strong computing power provides
critical support to our endeavors in developing and optimizing frontier AI models and exploring their
commercial application.
Intelligent Computing Cluster
Our intelligent computing cluster is the cornerstone of our AI solutions. Our intelligent
computing cluster currently harbors a computing power of over 184 PFLOPS, and a storage capacity of
over 10PB, both of which can be expanded without interrupting training tasks.
Our intelligent computing cluster can efficiently and dynamically dispatch thousands of GPUs
for parallel computing and seamlessly perform dynamic scale-up to address shifting business demand.
It also optimizes storage, bandwidth and computing power for large-scale machine learning tasks. For
large language models, in particular, our intelligent computing cluster carries out deep engineering
efficiency optimization of parallel mechanisms, fully utilizing computing and bandwidth resources.
The strong computing power, efficient and dynamic dispatch and scalability of the intelligent
computing cluster form our core competitive strengths in advancing AI solutions.
Machine Learning Algorithms
Since our inception, we have been exploring the potential of AI models in a wide range of
commercial application scenarios.
According to Frost & Sullivan, in 2012, we were one of the first to apply deep learning
algorithms to speech recognition products. Since then, we have continued to promote the commercial
application of advanced AI algorithms, including Convolutional Neural Network (CNN), Generative
Adversarial Networks (GAN) and Reinforcement Learning (RL).
We were also one of the first in Asia to commercialize AI large language models, according to
Frost & Sullivan. In 2018, leveraging emerging Transformer algorithms, we achieved top two ranking
in the WMT2018 World Machine Translation Technology Evaluation. Since then, we offered
Transformer-enhanced AI solutions to customers across a wide range of industry verticals. In 2023, we
launched our proprietary 60 billion-parameter large language model - UniGPT, which we continue to
iterate.
Data-centric Training Approach
Leveraging our industry know-how and insights, we have constructed a data-centric AI model
training and optimization framework, under which our AI models select diversified, high quality data
and feed them back to the continuous training and optimization of AI models, forming a self-
reinforcing cycle from accumulated data and industry know-how to the initial model, and from
feedback data to model optimization. We believe that training guided by even just limited volume of
high-quality data has superior efficiency than that guided by massive volume of unfiltered data. Such
150


--- page 160 ---
BUSINESS
training framework eliminates the need for model reconstruction when developing new AI solutions,
and does not require substantial human intervention, thus freeing us from the laborious instruction fine-
tuning support and allowing us to focus our R&D efforts on base model optimization.
UniBrain
UniBrain is the central technology platform layer that includes delivery and deployment methods
such as chips, edge-side SDKs and public and private cloud deployment. This central technology platform
powers our AI application solutions, and is where our developers build, test and manage the AI application
solutions. UniBrain is supported by Atlas AI infrastructure, and comprises a core algorithm model and a
wide array of AI components. The core algorithm model had been UniCore since 2019 until it was replaced
by UniGPT in May 2023. UniCore was our first BERT-based large language model. Building on the
evolution and advancement of the UniCore in past years, UniGPT features greater parameter and data scale
as well as generative capabilities, and, pre-trained with massive volume of text and code, it has over
60 billion parameters and possesses strong general abilities.
Key Features of UniBrain
Š Universal: UniGPT is based on large scale generative pre-training and efficient fine-tuning
framework. It possesses strong abilities in natural language, general knowledge, reasoning
and rapid learning and can handle complex application scenarios across industries,
improving commercialization efficiency.
Š Adaptable: We enhance UniGPT’s industry-specific application with incremental training
and fine-tuning with industry data, as well as plug-ins and AI components without the
need for heavy model re-training, adapting our AI solutions to highly-specialized
scenarios. We can integrate UniGPT with a customer’s proprietary knowledge bank, real-
time information and readily available APIs to optimize its performance in highly-
specialized application scenarios.
Š Efficient: Based on the strong language, knowledge and learning capability of UniGPT,
our AI solutions are inherently adaptive, capable of processing mainstream demands
across industries. When expanding the application of our AI solutions, we perform a task
data fine-tuning process rapidly under a unified adaptation framework, without the need
for model reproduction and process redevelopment based on specific business logics, and
hence significantly reducing the human input needed. This approach differs from the
traditional “workshop-style” manual crafting of AI end products, yielding higher R&D
efficiency.
Industry
Knowledge Graph
Machine Learning Algorithms
(DNN, Bert, GPT, ...)
server cluster
"Training"
UniGPT
Multimodal
Perception
Multimodal
Generation
......
Atlas, a “factory” for UniGPT
and AI componentsHuge amount of
Data
151


--- page 161 ---
BUSINESS
UniGPT and many AI components developed based on deep learning share common production
processes. They require a large amount of raw training data and substantial computing power, which is
typically provided by GPU servers. The GPU servers, collectively, form the intelligent computing
clusters of Atlas AI infrastructure. However, they face challenges brought about by the complexity of
the algorithm and the size of the data, and the computational power of the cluster. Also, there is a
contradiction between the scale of the cluster and the efficiency of scheduling.
As illustrated by the above chart, Atlas addresses these issues. It helps training AI components
from raw data and efficiently manages larger scale training of algorithms of increasing complexity.
AI Application Solutions
Sitting at the top of our technology stack, our AI application solutions layer is what users
interact with. Based on UniBrain, we offer easy-to-deploy AI products and solutions with optimal
performance that, based on our increasing MaaS capabilities, can be efficiently fine-tuned for a broad
range of customers, helping them improve operational efficiency and productivity, as well as bring
value to end users across industries. Specifically, the AI application solutions can be divided into
Daily Life and Healthcare scenarios:
Š Daily Life: We provide diverse AI products and solutions that can be applied in application
scenarios, including transportation, commercial space, hospitality and residential scenarios,
among others, to improve the convenience and quality of people’s everyday life. Enterprises
can provide immersive intelligent products and services empowered by our AI solutions to
their customers, thereby improving their operational efficiency and service quality and
reducing their management costs. For example, we developed the voice ticketing system
applied in the auto ticketing machine of the Shenzhen Metro Line 20. Such system enables
passengers to select their destinations through speech, shortening the average time spent on
selecting a station on a ticketing machine from approximately 15 seconds in the traditional
manual way to about 1.5 seconds. Such function enhances the efficiency of ticket purchasing
and addresses the issue of congestion caused by queues at ticketing machines, thereby
improving the overall passenger experience and optimizing the flow of traffic within the metro
station. In 2022, 2023 and 2024, our Daily Life solutions empowered 299, 294 and 313
enterprise customers and 86, 112 and 121 system integrators/agents, which include a top three
insurance group in China, Shenzhen Metro Line 20 and Xiamen Software Park. In addition,
we provide AI large language model capabilities through MaaS to developers and enterprises
on-demand. Key products include public cloud-based AI capability APIs, customized
proprietary AI technology service platforms and AI model-embedded chips and IoT hardware
modules. In the same years, we sold 12.8 million, 24.5 million and 36.0 million AI chips to
developers and customers, respectively. We typically determine the final price of our offerings
based on the total unit price of the products selected by the customer and the level of
customization performed.
Š Healthcare: We offer AI-empowered healthcare solutions such as medical record voice
entry, medical record quality control, single-disease quality control and medical insurance
payment management.
These AI solutions are typically delivered as customized AI-empowered systems, which
can regulate medical service processes and decisions, thus reducing medical errors,
improving medical service quality and safeguarding the rights of the patients. For instance,
152


--- page 162 ---
BUSINESS
in the context of medical record quality control, traditional information technology
solutions, prior to the application of AI, could only perform basic quality control in terms
of timeliness and completeness. However, with the application of natural language
understanding and clinical knowledge mapping, it can now conduct quality control in
terms of standardization and rationality, greatly enhancing the scope and depth of quality
control and reaching a degree of completion close to that of manual expert quality control.
Specifically, natural language understanding technology is used to identify entities and
extract relationships from medical record texts. Through understanding these documents, it
can model and recreate the changes in a hospitalized patient’s condition and the process of
diagnosis and treatment. Then, the knowledge stored in clinical knowledge graph is
applied for reasoning to determine whether the diagnosis and treatment actions reflected in
the medical record documents are reasonable, thereby conducting in-depth quality control.
These AI solutions can also help medical staff increase efficiency. For example, our
medical record voice entry system accelerates medical record entries by four to six times,
compared to typing input; our medical record quality control system reduces the time
required for quality review by 80%, compared to manual review, and thus is capable of a
full inspection of all the medical records, compared to a sampling inspection of medical
records if reviewed manually.
The NHC requires hospitals to report data on patients with certain diseases. The single-
disease data reporting system is a tool that we developed to help hospitals automate this
process and improve the quality of diagnosis and treatment. This system has three main
components:
Š The reporting on the individual disease: The system reads the electronic medical
records of each patient who meets the inclusion criteria for a specific disease, fills in
the required data items, and submits them to the NHC through an interface.
Š The indicator evaluation on the single disease: The NHC assesses the hospital’s
performance based on specific indicators for each disease. Our system provides the
hospital with a tool to conduct internal quality control based on the NHC’s standards.
Š The treatment process management for the single disease: Our system is a clinical
decision support system that reviews the doctor’s actions during the diagnosis and
treatment process, such as prescribing orders and writing medical records, and
provides feedback based on the patient’s condition and the best practices. It provides
timely reminders and warnings to avoid situations that could negatively impact the
quality of care for single diseases. For example, if a doctor, while writing the initial
medical record, fails to sufficiently assess the severity of pneumonia in a patient with
community-acquired pneumonia who meets the single disease reporting standards,
our system will promptly provide a pop-up reminder during the record writing
process.
The single-disease data reporting system reduces the workload for hospitals, enhances the
accuracy and timeliness of data reporting, and supports the improvement of clinical
outcomes.
With the adoption of our AI-empowered solutions, hospitals and medical institutions can
prevent unreasonable medical expenses, contributing to medical reform and enhancing the utilization
and efficiency of medical insurance systems. In 2024, we successfully delivered AI solutions to 166
153


--- page 163 ---
BUSINESS
healthcare customers. Our pricing model is typically determined based on the functionalities of the
solutions provided and the level of customization required. Importantly, we are not subject to any
product or medical liabilities to the end users of our healthcare products and solutions, as they are
designed to assist medical professionals in their decision-making processes.
Market Opportunity
AI has been adopted in a fast-growing number of application scenarios, which will be further
accelerated with the development of AGI technology. With the rapid evolution of large language models,
the exponential growth of computing power and data and the surge of application scenarios, AI,
particularly AGI, is expected to fundamentally alter the way we interact with the world. The emergence
of AGI solutions is transforming both the demand and supply ends across industry verticals, where
frontier technologies are driving market growth. According to Frost & Sullivan, China’s AI solutions
market is expected to grow from RMB180.4 billion in 2024 to RMB1,174.9 billion in 2030, with a
CAGR of 36.7%. We believe that AI will play a critical role in the following industries, among others:
Š AI Solution in IoT : According to Frost & Sullivan, the number of IoT devices in China
was 1.8 billion in 2022, presenting significant opportunities for AI-empowered
enhancement. The market of the AI Solution in IoT industry is expected to grow from
RMB71.0 billion in 2024 to RMB546.1 billion in 2030, with a CAGR of 40.5%.
Daily Life, encompassing AI solutions for residential, commercial space, hospitality and
transportation, represents the largest section in AI Solution in IoT.
Š AI Service and Solution in Healthcare : China’s healthcare industry has largely
completed its initial digital transformation, laying the foundation for AI innovation. As of
December 31, 2021, there were 36,507 hospitals in China, presenting significant potential
demands for intelligent upgrade. According to Frost & Sullivan, the AI Service and
Solution in healthcare market size is expected to grow from RMB9.9 billion in 2024 to
RMB146.5 billion in 2030, with a CAGR of 56.6%. AI in Healthcare Service and
Treatment, encompassing AI solutions for hospital and medical institutions, represents the
largest section in AI Service and Solution in healthcare.
Our Go-to-Market Strategy
We collaborate with leaders in the AI Solution in Daily Life and AI Service and Solution in
Healthcare industries, where we develop AI solutions and gain invaluable industry insights. We have robust
partnerships with industry leaders and secured future project collaborations. Leveraging the know-how,
experience and market recognition acquired from our lighthouse projects and the high scalability of our AI
solutions, we introduce our solutions to other customers in the same industry and to other industries with
similar pain points and needs. This go-to-market strategy allows us to continuously enhance the level of
engagement of our key customers with constantly improved offerings and grow our customer base. During
the Track Record Period, our customers increased from 538 in 2022 to 555 in 2023 and further increased to
576 in 2024, primarily as a result of the increase in the wide variety of AI solutions and products we offered
and the increase in their applicable industries, as well as the increased demand for intelligent medical
solutions along with the intelligence upgrade of internal systems among hospitals.
Financial Overview
During the Track Record Period, our revenue was primarily derived from the sales of products
and solutions. Our revenue increased from RMB600.6 million in 2022, to RMB939.0 million in 2024,
154


--- page 164 ---
BUSINESS
with a CAGR of 25.0%; our gross profit increase, from RMB239.9 million in 2022 to
RMB364.5 million in 2024, with a CAGR of 23.3%; our net losses in 2022, 2023 and 2024 were
RMB375.4 million, RMB376.2 million and RMB454.2 million, respectively; and after adding back
share-based payment expenses, finance cost of interest on redemption liabilities and listing expenses,
our adjusted net losses (non-IFRS financial measure) for 2022, 2023 and 2024 were RMB183.2 million
, RMB136.6 million and RMB168.4 million, respectively.
OUR STRENGTHS
Early entrant in AGI Technologies
Since our inception, we have explored the AI technological innovation and led the progress of
commercial application of AI technologies in China. We consistently ranked as the fourth largest AI
solution provider by revenue with a market share of 0.6% in China in each year of the Track Record
Period
Deep Learning Algorithms Evolution: Keeping abreast of the advancement of deep learning
algorithms, such as DNN and CNN, we incorporate frontier technologies in our innovative products
and solutions, and led the commercialization endeavors. We were one of the first in Asia to (i) apply
deep neural network algorithms to speech recognition products; and (ii) release a commercial cloud-
based speech recognition engine based on deep learning, according to Frost & Sullivan. In 2012, we
commenced the commercial application of deep learning technology, assisting Sogou, a leading
Internet search engine provider in China, in launching its voice assistant. In 2016, we launched the
voice electronic medical records service at Peking Union Medical College Hospital. The performance
of our deep learning algorithms was also recognized in prominent awards, including:
Š 2017 AWE (Appliance & Electronics World Expo) Best Component Award;
Š 2020 Blizzard Challenge International Speech Synthesis Competition, where we ranked
first place in several indicators for Mandarin and Shanghainese with proprietary end-to-
end speech synthesis technology;
Š 2021 INTERSPEECH, second place in both Deep Noise Suppression and Acoustic Echo
Cancelation Challenge; and
Š 2023 VoxCeleb Speaker Recognition Challenge, first place in Track 1.
AI Infrastructure and Path towards AGI: Since 2016, we have built an AI technology
system for large-scale commercial applications, including the Atlas AI infrastructure platform which
supports the growing scale of AI model training and optimization, and knowledge graph platform
which focuses on the industry enhancement of AI models, equipping them with knowledge in
specialized areas. Soon after the breakthroughs of Transformer in 2017 and BERT in 2018, leveraging
our R&D expertise in conversational AI and market insights gained since our inception in 2012, we
launched our first BERT-based large language model, UniCore, and related AI solutions for customers
across a wide range of industry verticals. In early 2019, we upgraded BERT to enhance its cognitive
capabilities and adopted those in, among others, our medical knowledge graph for medical record
quality control products. The evolution of our AI models enabled us to expand the application of AI
solutions, and marked our transition from offering single product solution to industry-wide solutions.
Our technological strengths continued to excel, receiving major awards including:
Š 2019 Beijing Science and Technology Progress Award, First Prize (
ኪҦஔආӉᆤ
ɓഃᆤ);
155


--- page 165 ---
BUSINESS
Š 2020 National Knowledge Graph and Semantic Computing Conference (ᗆྡᗅၾႧ
ၑɽึ(CCKS)), Champion of the “Medical Named Entity Recognition Evaluation
Task for Chinese Electronic Medical Records” (ᔼᐕնΤྼ᜗ᗆй൙಻
΂ਕ) and won the only technology innovation award;
Š 2022 Association for the Advancement of Artificial Intelligence (AAAI) conference, first
place in both Acronym Extraction and Acronym Disambiguation tasks;
Š 2022 Chinese Biomedical Language Understanding Evaluation (CBLUE) Championship;
Š 2023 CCKS 2023 — PromptCBLUE (Chinese Medical General Large Language Model
Evaluation) Championship;
Š 2024 Edge Scene Multimodal Intelligent Analysis and Chip Key Technology and
Application Technological Progress Award (ၾ౺˪ᗫᒟҦஔʿᏐ
ҦආӉᆤ) held by Fujian Provincial People’s Government, first place;
Š 2024 National Smart Medical Insurance Competition (2024ɽᒄ), first prize;
In 2022, leveraging Atlas AI infrastructure and solid Transformer algorithm technological
foundation, we began to explore innovative applications of generative pre-trained large language
models. In May 2023, we released our proprietary Generative Pre-trained Transformer, UniGPT, with
significantly enhanced capabilities from UniCore, and adopted it in Healthcare and Daily Life
products, marking a major advancement in AI large language model commercialization. In June 2024,
UniGPT ranked first in the MedBench Evaluation, with an overall score of 82.2. Furthermore, it was
recognized in the 2024 SuperCLUE Semi-Annual Report as a global top-tier large language model.
With an overall score of 72, it ranked first in terms of STEM-related capabilities and second in terms
of humanities-related capabilities in China. These accomplishments demonstrate UniGPT’s
competitive edge and leadership in advancing AI large language models on both a national and global
scale.
R&D and Productization Capabilities Powered by Solid Infrastructure
One of the key factors that distinguishes us from peers is our Atlas AI infrastructure. This AI
infrastructure performs (i) the dynamic dispatch of computing power resources based on shifting
business demands; (ii) the initial training of large language models based on massive volume of data;
and (iii) efficient optimization guided by selected high-quality user feedback. Robust AI infrastructure
supports the constant advancement of UniBrain, helping us keep up with technological advancement
and deliver innovative AI solutions with strong performance.
UniBrain has strong capabilities in processing natural language and general knowledge, which
enable it to address the mainstream demands across industries. UniBrain improves the efficiency of the
development process from the base model to the actual product, underpinning the efficiency of our
development and the adaptability of our products. Its approach differs from the traditional “workshop-
style” manual crafting of AI end products, and helps us further increase R&D efficiency and shortens
the time to market of our technologies. Since 2023, powered by UniGPT, we expect our R&D and
productization efficiency to be further enhanced. UniBrain provides AI capabilities and solutions based
on AI models through various software and hardware delivery modes. It supports rapid adaptation and
customization, allowing our customers to set up AI firmware for devices such as air conditioners and
smoke ventilators within 30 minutes using the developer platform for our AI chips. Our solutions
penetrated nine new industry verticals since 2020, including urban rail transit and commercial medical
insurance management.
156


--- page 166 ---
BUSINESS
With Atlas AI infrastructure and UniBrain, we have independently trained AI large language
models under Transformer algorithm framework, and developed innovative AI products and solutions
with significant R&D efficiency. Our seasoned R&D engineers have a proven record in constantly
delivering top-notch R&D results.
Extensive and In-depth Collaboration Underpinning Commercialization Success
With advanced AI technology and R&D capabilities, we have successfully penetrated a broad
range of industries, engaging with their leading companies, who we term as “lighthouse customers,”
such as Gree in home appliances, Ping An Technology in health and elderly care, Peking Union
Medical College Hospital in medical service and PICC in medical insurance.
Through collaboration with lighthouse customers, we gained extensive exposure to a wide
spectrum of application scenarios within their industry verticals. These include both highly frequent,
representative scenarios, and fragmented long-tail scenarios. Though each of the long-tail scenarios
individually occurs less frequently, collectively, they account for a significant portion of all scenarios.
This exposure gives us invaluable insights into each industry, enabling us to quickly identify common
needs, develop targeted solutions and expedite their deployment.
With market knowledge gained from years of experience in commercializing AI products and
solutions, we have strategically focused on the AI solution in Daily Life and AI service and solution in
healthcare industries, both of which offer proven market potential. In 2016, we entered the AI in home
vertical in cooperation with Gree. In the same year, we worked with Peking Union Medical College
Hospital to launch voice-based electronic medical record solutions for hospitals. As of December 31,
2024, our AI solutions have been adopted in a broad range of industry verticals including medical,
residential, commercial space, hospitality and transportation. According to Frost & Sullivan, we
remained the fourth largest AI solution provider by revenue in China in each year of the Track Record
Period, yet recording a high growth rate among those with annual revenues over RMB500 million.
While the market size of AI solution in China increased by 33.1% from RMB135.5 billion in 2023 to
RMB180.4 billion in 2024, our revenue increased by 29.1% from from RMB727.3 million in 2023 to
RMB939.0 million in 2024. In 2024, we ranked third by revenue in AI Solution in Daily Life and
fourth in AI Service and Solution in Healthcare in China.
In 2024, we served 576 customers. Our commercialization success is evidenced by solid
financial performance. In 2024, our revenue reached RMB939.0 million, a year-on-year increase of
29.1%, and the CAGR of our revenue from 2022 to 2024 reached 25.0%.
Feedback Loop Continuously Driving Technology and Product Advancement
Guided by massive data from real world scenarios and continuous user feedback, our AI
models perform highly-automated self-reinforcement with increasing efficiency, propelling the
continual iterations of our AI technologies. High-quality and massive data enable us to unleash the full
strengths of cutting-edge models. For example, the accuracy of AI semantic understanding improved
from 88.04% by pre-BERT deep learning models in 2018 to 91.02% by UniCore in 2019, and further
to 96.07% by UniGPT in 2023. Such technological advancement, among others, allow us to extend the
capabilities of our AI solutions from perception to comprehension, response and generation.
The advancement of our AI technologies allows us to expand the application of our AI
solutions, constantly tapping into new industry verticals and application scenarios with stronger and
more sophisticated solutions. Fragmented market demands pose significant difficulties for AI solution
157


--- page 167 ---
BUSINESS
providers. Frequently, when faced with demands from new application scenarios, it becomes
impractical to repurpose existing AI solutions due to their specific and static design, leading to
considerable resource investment in customizing or even entirely redesigning AI solutions. With
UniBrian’s universality, adaptability and efficiency, and facilitated by the feedback loop, we are able
to constantly optimize our AI models and products efficiently.
Our continuously optimized products have strong performance and cost-effectiveness,
accurately addressing customer demands, gaining significant market popularity. As of the Latest
Practicable Date, (i) our IoT products were applied to tens of millions of devices, across various
verticals such as residential, commercial space, hospitality and transportation, accumulating know-how
and experience; and (ii) our Healthcare product, medical professional knowledge graph, housed
253 million concepts, 495 million terms and 984 million relationships.
Experienced Management Team and Core Personnel
We were founded by Dr. Huang, our CEO, Dr. Liang, our Chairman and CTO and Dr. Kang,
head of our IoT department, who were later joined by Dr. Li Xiaohan, head of our R&D department.
These leaders have rich experience in AI R&D and industrialization, led our endeavors in pioneering
the commercial application of deep learning algorithm, and strategically selected our R&D and
marketing focuses. Mr. Xie Guanchao and Mr. Chen Jisheng later joined the management team, both
of whom have ample experience in technology R&D and project management at well-known
companies both domestically and abroad. They currently head our Healthcare department and
innovative business department, respectively. The combination of academic and industrial
backgrounds endows our management with profound strategic vision in AI technology and market, and
extensive industry connections.
Under the leadership of our management, we have amassed a team of AI professionals as our
core technology officers, with profound industry experience gained at well-known international
enterprises such as IBM, Motorola, Microsoft and Nuance, holding Ph.D. or Master’s degrees from top
universities in China and abroad, such as University of Science and Technology of China, Chinese
Academy of Sciences, Peking University, Tsinghua University and UIUC.
OUR STRATEGIES
Enhancing AI Infrastructure and Models
Our leading AI infrastructure and large language models form the foundation and driving force
of our rapid growth.
We plan to enhance Atlas AI infrastructure by (i) expanding the computing power of the
intelligent computing clusters to support the evolution of existing large language models and the
training of future models; (ii) keeping abreast with the evolution of fundamental machine learning
algorithms, with a view to further advancing our technology system.
We plan to continue upgrading our UniBrain to enhance our AI development capabilities. We
intend to roll out more powerful large language models and improve their efficiency by (i) building
large language models with larger parameter scales, trained and optimized by data with higher quality,
enhanced by a broader spectrum of plug-ins and AI components; (ii) training and optimizing
proprietary multimodal large language models that can directly process inputs such as images, voice
and text, making it easier to launch new AI solutions targeted at multimodal scenarios in the future;
158


--- page 168 ---
BUSINESS
meanwhile, we plan to explore technologies and applications such as event detection, emotion
recognition and multimodal perception. In the field of generation, we aim to enrich vocal styles
supported by our large language models, enhance personalized and emotional synthesis and continue to
improve voice-image fusion multimodal synthesis technologies, transitioning from “information
transmission” to “creative assistance.”
Attracting and Nurturing AI Talents
Our success is deeply rooted in our cutting-edge technologies which are forged by our frontline
R&D talents.
We intend to strengthen our cooperation with top tier universities and research institutions.
Through collaborations in joint R&D, experimental course design, competitions and internships, we
aim to identify suitable talents and initiate preliminary contact during such collaborations.
While expanding the team, we also plan to maintain and refine our comprehensive training and
development program for our talents. We are committed to providing first-class AI infrastructure and
growth support for top talents to boost the efficiency of their R&D efforts. We focus on training our AI
talents to be industry-oriented, capable of optimizing the application of AI solutions. With a solid
understanding of the foundational AI technologies, they are expected to acquire insight into various
industries and customer needs through practice, and contribute to the development of new or better
solutions through continuous innovation. With our systematic training plan, we endeavor to ensure that
our talents can focus on innovation and honing general capabilities across modules, rather than getting
embroiled in trivial supporting tasks under a project-based approach. We plan to cultivate a research
and application force who excel in technology and product R&D and can serve as the mainstay of our
team in the retaining and succession of know-how, experience and culture.
Expanding Application Scenarios and Industry Verticals
As AI continues to transform the way we work, communicate and interact with the world, we
see emerging opportunities for AI application in numerous scenarios across all industries. Even in the
industries already penetrated by our AI solutions, there remain significant needs for intelligent upgrade
that are not yet addressed. Meanwhile, there are a wide range of industry verticals that have not been
penetrated by AI solutions. Our industry insight and reputation built through the collaboration with
lighthouse customers can help us attract more users and accelerate commercialization in the penetrated
industries:
Š Delving Deeper into the Needs of Penetrated Industries : We have solid and highly
interactive cooperation with users through high-quality solutions and services. Leveraging
existing industry relationships and empowered by UniGPT, we plan to expand the reach of
our AI solutions to cover more application scenarios, identifying and addressing demands
yet untapped by AI solutions. For example, expanding from medical service to medical
insurance and then to medical regulation.
Š Translating Success Experience to Mid-long Tail Customers : In many penetrated
industries, we have robust relationships with lighthouse customers. We acquire valuable
know-how, experience and industry insights in the collaboration with lighthouse
customers. We expect to continue to translate success experiences to mid-long tail
customers in the industry, offering them efficient and highly standardized solutions
addressing common needs and representative scenarios in the industry, and are quick-to-
deploy on demand.
159


--- page 169 ---
BUSINESS
Š Expansion of Industry Coverage : Leveraging our understanding of Daily Life and
Healthcare, we have successfully expanded into the health and wellness verticals. We plan
to strengthen our capabilities and look for expansion opportunities in related fields. With
UniBrain’s universality, we expect our penetration of new industry verticals to be more
streamlined and efficient.
Expanding Internationally
UniGPT’s ability to adapt to multiple languages is conducive to our international expansion.
User feedback obtained through the interactions with users from different locations provides us with
targeted enhancement to UniGPT’s multi-lingual capabilities.
As UniGPT starts to offer support in more languages, we will have strengthened capabilities in
international operations. On the one hand, UniGPT with multi-lingual capabilities can help us address
domestic customers’ needs in their international expansion. On the other hand, by cooperating with
overseas partners and building overseas distribution channels, we expect to tap into overseas market
with solutions that have been verified in the China market, with a view to empowering the intelligent
transformation on a global scale. We plan to focus on overseas markets where there is robust digital
infrastructure and high demand for AI solutions. Meanwhile, we are mindful of potential geopolitical
uncertainties and international trade policies. For details, see “Risk Factors — Risks Related to Our
Industry and Business — We might be subject to the risks associated with international trade policies,
geopolitics and trade protection measures, and our business, results of operations, financial conditions
and prospects could be adversely affected.”
UNIBRAIN
We have developed UniBrain, our proprietary central technology platform providing support
for our solutions and products, which comprises the general large language model UniGPT and AI
components. UniBrain possesses one-stop capabilities in perception, comprehension and response. It
integrates (i) multimodal AI capabilities with conversational AI at the core, (ii) industry-scale
knowledge graphs developed based on industry insights and expertise amassed through years of
practice, and (iii) one-stop IoT interconnection system empowering IoT devices. The below diagram
summarizes the interaction between UniGPT and our AI components:
IoT
Interconnection
Industry
Knowledge Graph
Multimodal
Perception
Multimodal
Generation
Information Flow
Action Flow
UniGPT
AI Components
Multimodal
Language
Knowledge
Reasoning
160


--- page 170 ---
BUSINESS
UniGPT
In early 2019, we launched our first large language model, UniCore, which was built through
unsupervised pre-train, with hundreds of millions of parameters. It functioned as the initial core
algorithm model of UniBrain. Through pre-training with large quantity of language materials and
instruction fine-tuning for industry-specific tasks, it significantly enhanced our products’ capabilities in
semantic understanding, answer selection and information extraction, and therefore became the
technology core of our products and solutions.
Building on the evolution and advancement of UniCore in the past years, we launched UniGPT
in 2023. Trained with a larger scale of text and code data, UniGPT possesses powerful general
language, knowledge, reasoning and few-shot learning capabilities. Compared to UniCore, UniGPT
has the following major improvements:
(i) Advanced Framework : UniGPT adopts an end-to-end generative AI framework, enabling
seamless contextual dialog and open-ended Q&A. It handles the entire process, from input
to output, without relying on multiple specialized modules, making it more flexible and
adaptable to various tasks.
(ii) Greater Scale : With a parameter and training scale over 100 times larger than UniCore,
UniGPT delivers significantly superior performance.
(iii) Enhanced Learning : UniGPT supports chain-of-thought and few-shot learning, which
allows it to learn from minimal examples without needing extensive retraining.
Below are examples that demonstrate how UniGPT enhances overall operational efficiency:
(i) Intent Recognition : UniGPT reduces the manual workload for writing training data from
300 entries per intent to just 15, automating the creation of the remaining 285 entries. This
results in a 95% reduction in manual work, improving efficiency while ensuring data
quality and consistency. This in turn enhances the performance and accuracy of machine
learning models.
(ii) Information Extraction : Compared to older models, UniGPT requires 89.5% less training
data to achieve the same results. This makes the entire process more efficient, reducing the
resources and time needed for data collection and preparation.
(iii) Semantic Understanding : With UniGPT, only one model is needed to support a solution
compared to four models required with BERT. This streamlines operations, improves
efficiency and reduces computational requirements, making UniGPT a more effective and
resource-efficient solution.
161


--- page 171 ---
BUSINESS
We further optimize UniGPT through instruction fine-tuning and reinforcement learning from
human feedback to develop its capabilities of language generation, semantic understanding, knowledge
Q&A, logical reasoning, mathematical calculation and code generation which are in compliance with
safety rules, with the ultimate goal of realizing human-like AGI. For specific industry such as the
medical field, by incremental training with high-quality medical textbooks, clinical guidelines and
medical record, UniGPT significantly improves its knowledge and capabilities to solve professional
problems, passing the US Medical Licensing Examination with an accuracy of 87.1 on the MedQA
dataset, exceeding that achieved by GPT-4, according to Frost & Sullivan. The following screenshots
illustrate the core capabilities of UniGPT:
Language Generation
Note:
The above dialog translates to:
“If I am about to take up the position of director of the ophthalmology department of the
hospital, please write an inauguration speech for me.”
“Dear colleagues, family and friends:
First of all, I would like to express my most sincere gratitude to you all! Because it is your recognition
and support for my achievements that I can stand here today to deliver my inauguration speech.
It has been more than a decade since I entered the medical field, and each period has given me many
valuable opportunities to improve myself and serve more people who need attention. And now, I am
very fortunate to have been chosen to take over the management of ophthalmology department.
162


--- page 172 ---
BUSINESS
I am fully aware of the significance of this transformation and the challenges ahead. Yet it is precisely
these challenges that have made me more excited and motivated. I believe that as long as all of us
work together, with professional skills and good attitudes as cornerstone, and in combination with
innovative ideas and practical approaches, we will achieve gratifying results.
In addition, I would like to highlight that our goal is not only to treat eye problems per se, but also to
guide the public at large to maintain healthy vision and reduce blindness rates through health
education and other means. Hopefully, in the future we will be able to carry out more charity activities
to give back to the community.
Finally, I would like to say that, wherever and whenever we are, we must always keep patients in mind
and take their interests as the fundamental starting point, and make sure that they receive the best
medical services. I sincerely hope that we can build a better future together and embrace more
challenges and opportunities.”
Semantic Understanding
Note
The above dialog translates to:
“‘The weather tomorrow is so good’ and ‘The weather tomorrow is not bad,’ which expresses stronger
emotions?”
“‘The weather tomorrow is so good’ has stronger emotion, as ‘so’ means very and ‘not bad’ only
means quite good and does not have such strong emotions.”
163


--- page 173 ---
BUSINESS
Knowledge Q&A
Note:
The above dialog translates to:
“The line of an ancient poetry “The reflection of the pavilion and terrace enters the pond’
insinuates the reflection or refraction of light?”
“This line of ancient poetry reflects the phenomenon of light reflection. The term “reflection” refers to
the image of an object reflected by a medium parallel to the surface, such as water, rather than being
refracted through the medium.”
164


--- page 174 ---
BUSINESS
Logical Reasoning
Note:
The above dialog translates to:
“Xiao Ming has two brothers, the elder one is called Wang Da (the eldest) and the second
brother is called Wang Er (the second), so what is the surname of Xiao Ming?”
“The surname of Xiao Ming is Wang. As Xiao Ming has two brothers, Wang Da and Wang Er. In
Chinese culture, brothers usually have the same surname, so it can be deduced that the surname of
Xiao Ming is Wang.”
165


--- page 175 ---
BUSINESS
Mathematical Calculation
Note:
The above dialog translates to:
“There are chickens and rabbits in the same cage. There are 35 heads above the cage and 94
feet below the cage. How many chickens and rabbits are there?”
“Assuming the number of chickens is x and the number of rabbits is y, the question can be converted to
the following formula: x + y = 35
2x + 4y = 94
Solving the equations yields:
y=12
x=23
Therefore, the number of chickens is 23 and the number of rabbits is 12.”
166


--- page 176 ---
BUSINESS
Code Generation
On top of its general-purpose capabilities, UniGPT can be optimized through plug-in extension,
industry enhancement and customization, which substantially enhances its expertise in industry
verticals such as Daily Life and Healthcare:
Š Plug-in Extension : UniGPT enables real-time information retrieval and industry-scale
knowledge graph capabilities through plug-ins, providing professional information and
knowledge consolidation, fully utilizing the comprehension and generation capabilities of large
language models and reducing the outdated or incorrect information results. If necessary,
UniGPT can call external APIs to improve its overall problem-solving capabilities, effectively
integrating external information, knowledge and standard tools.
Š Industry Enhancement : Through incremental training using domain text corpus and
instruction fine-tuning, UniGPT equips itself with cross-domain language and knowledge
which enhances its industry-specific knowledge and skills, improving its capabilities to
solve professional problems.
Š Customization: With customer information and knowledge, UniGPT can further enhance
its capabilities to solve specific issues of such customer and meet customer demand for
customization through its information and knowledge consolidation capabilities input.
UniGPT, with its upgrade of cognitive architecture, has enhanced the MaaS-based business
model. Before UniGPT, to develop a novel AI solution in the era of “workshop-style” manual crafting
of AI end products, it was necessary to design and complete the training processes based on relevant
business logics, and call relevant intelligent components such as recognition, comprehension and
generation when necessary, supplemented by testing and optimization. Such processes typically require
significant human inputs. Moreover, the training processes typically need to be re-developed whenever
167


--- page 177 ---
BUSINESS
there is adjustment or expansion of business. Leveraging its universality, UniGPT helps us
significantly reduce the amount of data and human inputs needed for model fine-tuning in the
development of new solutions, which differs our AI products and solutions from the traditional
“workshop-style” manual crafting of AI end products and has significantly improved the efficiency.
AI Components
UniBrain comprises a wide array of AI components: (i) multimodal perception and generation
capabilities supporting conversational AI and other interactions, serving as the foundational AI support
for UniGPT’s interaction with application scenarios; (ii) industry-scale knowledge graphs, covering
industries such as Daily Life and healthcare, with expansibility into more verticals, enhancing the
professional expertise of UniGPT; and (iii) one-stop IoT interconnection system, facilitating the
uniform management and interaction of all IoT devices within a closed-loop system.
Multimodal Perception and Generation
UniGPT’s perception and generation strengths can be enhanced by the multimodal capabilities from
AI components, enabling it to deliver strong performance in interaction, reasoning and decision-making in a
broader realm of real-life scenarios.
Š Multimodal Perception : Through technologies including signal noise reduction, voice
wake-up, speech recognition, voiceprint recognition, facial recognition, OCR and
pronunciation assessment, UniBrain can achieve multimodal perception capabilities under
multi-scenarios and complex environment.
Š Multimodal Generation : Through technologies such as text-to-speech synthesis (TTS)
and audio-visual synthesis (AVS), responses generated by UniGPT can be automatically
converted to high-quality natural voice and visual signals, achieving personalized
responses with human-like emotions.
Industry-scale Knowledge Graphs
We have developed industry-scale knowledge graphs facilitating highly efficient and seamless
interaction of industry-specific professional information. Our industry-scale knowledge graphs are
built with natural language processing and knowledge graph technologies, providing visualized
knowledge graph construction and management functions through standardized development kits for
relevant services and applications. Through industry insights and expertise across industries, we can
tap into new industries and develop relevant knowledge graphs with increasing efficiency. For
example, as of the Latest Practicable Date, we had accumulated 253 million concepts, 495 million
terms and 984 million relationships in our healthcare knowledge graph platform.
Our industry-scale knowledge graphs offer the following major functions:
Š Knowledge Management : Effectively organizing and managing documents covering
industry knowledge, standards and laws and regulations, providing services including
semantic search, document recommendation and Q&A to improve working efficiency of
users.
Š Quality Management : Based on industry-scale knowledge graphs and standards and
norms, conducting compliance check, verification and quality control of business data,
168


--- page 178 ---
BUSINESS
improving service quality and evaluation efficiency, and providing feedback to improve
service standards.
Š Decision-making Assistance : Based on industry-scale knowledge graphs and industry-
specific information, providing analysis assistance and decision-making support,
improving manual decision-making quality and efficiency.
One-stop IoT Interconnection System
With the prevalence of IoT devices, the AI digitalization era witnessed a surge of unstructured
data. To tackle the challenges posted by vast amount of fragmented and unstructured data from
separately connected individual devices, we have built our one-stop IoT interconnection system where
all the relevant spaces, devices, users and services are interconnected for specific application scenarios
to redefine the organic interactions among people, events and objects. Through such interconnection,
fragmented data are streamlined and organized, enabling UniGPT to harness the value of structured
information inherent therein.
Our IoT interconnection system connects objects and delivers instructions by users through a
three-layered structure of “perception-processing-output”:
Š Perception: Our IoT interconnection system is accessible by cloud, edge and end devices,
and supports collaborative computing of information across all such devices.
Š Processing: With the support of our AI capabilities and through the processing by AI
engines, our IoT interconnection system streamlines and organizes unstructured data for
processing, analysis and decision-making by the UniBrain and effectively harnesses the
value of structured information.
Š Output: With the support of our industry-scale knowledge graphs, our IoT interconnection
system can provide systematic professional-level information outputs.
See “– Our Core AI Technologies.”
The following is an example to demonstrate how the various components within UniBrain
collaborate.
“How do I get to the
restroom in this
building?”
User
KG Knowledge
Graph ...IoT
UniGPT AI Components
UniBrain
UniGPT
Multimodal
Perception AI
Component of ASR
Multimodal
Generation AI
Component of TTS
AC
AA
AA
AA
AA
5
2
1 6
4
3
“Please see the
route to the
restroom on
the screen.”
169


--- page 179 ---
BUSINESS
A user is looking for a restroom in a building and speaks to a interactive station equipped with
our intelligent sound recognition and voice dialog modules for directions. Here is how the process
unfolds:
1. The user asks the robot, “How do I get to the restroom in this building?” The user’s voice
is first transmitted to UniBrain. UniBrain employs the Automatic Speech Recognition
(ASR) component, which is one of the AI components, to transcribe the user’s voice into
text for the next steps.
2. The text is relayed to UniGPT. UniGPT interprets the user’s question. If the question
pertains to public knowledge, such as “What is the highest mountain?”, UniGPT can
directly formulate a response, organize the language in the form of text, and forward the
text to the Text-to-Speech (TTS) component, which is another AI component. The TTS
then converts the text into natural human speech and broadcasts it via the interactive
station. However, if the question concerns building-specific, non-public information,
UniGPT requires the assistance of other AI components to generate a response.
3. In this case, UniGPT invokes the Knowledge Graph component, a dynamic knowledge
base maintained by the building’s operations team, which contains information about the
building’s layout, to determine the location of the restroom closest to the user.
4. UniGPT further engages the IoT component. This component, akin to the building’s nerve
endings, interfaces with various IoT devices in the building. It monitors the status of each
device to ascertain the current status of the restroom closest to the user. If the restroom is
“occupied,” alternative restroom locations are prepared based on the information provided
by the Knowledge Graph.
5. UniGPT consolidates this information and automatically crafts a language expression in
the form of text such as “Please see the route to the restroom on the screen,” then forwards
this text to the TTS component, which converts the text into natural human speech and
broadcasts it via the interactive station. At the same time, the floor plan with the direction
is displayed on the screen of the interactive station.
OUR OFFERINGS
Our products and solutions are based on UniBrain, our central technology platform comprising
our proprietary large language model UniGPT, which functions as its core algorithm model, and a wide
array of AI components.
We integrate various delivery and deployment methods such as chips, edge-side SDKs and
public and private cloud deployment. We offer a broad range of AI solutions and products for
Daily Life and healthcare scenarios.
Through our development of AI capabilities and long-term exploration of business
opportunities, we have selected Daily Life and healthcare as our primary targeted markets.
According to Frost & Sullivan, the industry verticals of AI are primarily classified by application
scenarios and related data utilization, and our offerings are segmented into Daily Life, which
primarily offers residential, commercial s pace, hospitality and transportation support under
Daily Life scenarios, and Healthcare, which primarily offers AI-empowered business system support
under professional medical scenarios. Leveraging UniBrain, we have developed a full spectrum of
offerings and provide diversified products and solutions with swift and cost-efficient customization.
170


--- page 180 ---
BUSINESS
We package our AI capabilities into standardized software and hardware products and solutions for
customers or users in various application scenarios and industry verticals through UniBrain.
For example, our AI chip product, which embeds our conversational AI engine into self-
developed or third-party chip hardware, offers customers highly customizable user interface. This
process is empowered by UniBrain, which makes accessible certain AI capabilities to the customers to
assist its development and customization. Our customers, who are primarily downstream solution
providers in various daily life scenarios, can therefore customize our chip product by designing a user
interface that is compatible with its intended use cases. We provide edge-side SDKs such as voice
wakeup, speech recognition and TTS engines for home appliances, and noise reduction, speech
recognition and TTS engines for in-vehicle voice interaction. We also package our AI capabilities such
as speech recognition capabilities and pronunciation assessment capabilities into standardized and
customizable products through UniBrain and serve downstream solution providers or brands through
cloud services.
Through our flexible delivery and deployment methods, we have significantly reduced the
implementation cost of our AI services and achieved large-scale shipments and a considerable market
share. We have started to offer and plan to expand MaaS-based products and solutions.
The following table sets out a breakdown of our revenue by streams and the offering types
thereunder for the years indicated:
For the year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Daily Life ..................................... 486,682 81.0 578,729 79.6 739,830 78.8
Solutions ...................................... 393,197 65.5 475,230 65.3 622,534 66.3
Products ....................................... 93,485 15.5 103,499 14.3 117,296 12.5
Healthcare .................................... 113,452 18.9 148,245 20.4 199,180 21.2
Others(1) ....................................... 4 8 5 0 . 1 3 4 2 0 . 0 7 0 . 0
Total ......................................... 600,619 100.0 727,316 100.0 939,017 100.0
Note:
(1) Others primarily consist of revenue from leasing office premises and sales of certain electronic devices.
171


--- page 181 ---
BUSINESS
The following table sets forth the details of our top five projects in terms of revenue contribution in each year during the Track Record Period:
Top Five
Projects
in 2022
Project
Type
Customer
Type Customer
Customer Background
and
Scale of Operations
Solution
Provided Project Description
Duration
Contract
Sum (tax
included)
Percentage of
Completion
Recognized Revenue
(tax exclusive)
Backlog Contract
Value(1)
Year ended
December 31,
Year ended
December 31, As of December 31,
2022 2023 2024 2022 2023 2024 2022 2023 2024
Year

(RMB in
thousands) % (RMB in thousands) (RMB in thousands)
Project A . . Daily
Life
System
integrator/
agent
Customer A
(2) A provider of
comprehensive urban
rail solutions primarily
engaging in general
construction, system
development and
integration services and
urban rail transit
equipment
manufacturing. Its
business has extended to
over twenty provinces
and municipalities and
over fifty cities in the
PRC, and also to
overseas customers.
Transportation
Solution
By integrating our
proprietary IoT platform
and full-stack AI
capabilities—including
speech-to-text, facial
recognition and
behavior analysis—we
connect terminal devices
located at different
stations to a unified IoT
platform. Leveraging AI
for image analysis and
voice coordination, we
provide an integrated
hardware and software
solution tailored for
smart railway station
scenarios.
2022-2022 26,864.0 100.0 — — 23,978.0 — — — — —
Project B
(phase I) .
Daily
Life
Enterprise
customer
Suzhou
Chongtian
Intelligent
Engineering
Co., Ltd.
(3)
A company specializes
in intelligent space
transformation and
digital new
infrastructure, providing
solution consulting,
planning and design,
equipment provision,
construction
management, system
integration, and
operation services. It is
a subsidiary of Shimao
Group Holdings
Limited.
Residential
Solution
By combining our full-
stack AI capabilities—
including speech
recognition, natural
language understanding,
facial recognition,
speech synthesis and
specific behavior
analysis—with IoT
devices such as in-home
voice-controlled smart
screens, elevator control
systems and access
gates in public areas, we
enable seamless
connectivity. This
allows property owners
to experience a fully
unified journey from
entering the community
to arriving at their
home.
2022-2027 17,319.9 94.1 1.2 1.2 14,423.1 183.9 183.9 904.3 720.4 536.5
172


--- page 182 ---
BUSINESS
Top Five
Projects
in 2022
Project
Type
Customer
Type Customer
Customer Background and
Scale of Operations
Solution
Provided Project Description
Duration
Contract
Sum (tax
included)
Percentage of
Completion
Recognized Revenue
(tax exclusive)
Backlog Contract
Value(1)
Year ended
December 31,
Year ended
December 31, As of December 31,
2022 2023 2024 2022 2023 2024 2022 2023 2024
Year

(RMB in
thousands) % (RMB in thousands) (RMB in thousands)
Project C . . . Daily
Life
System
integrator/
agent
Customer B
(2) A leading software and
information technology
service company that
provides information
technology products and
intelligent solutions for
governments, enterprises,
and various institutions.
Commercial
Space
Solution
By integrating our full-
stack AI capabilities—
including speech
recognition, natural
language understanding,
facial recognition, speech
synthesis and specific
behavior analysis—with
IoT devices such as
multimodal interactive
screens, voice remotes,
elevator controls, facial
recognition pads, parking
access equipment and
energy monitoring
devices, we enhance
business park
management. Using digital
twin technology and a self-
developed low-code work
order system, we enable
management teams to
deliver visualized services
to tenants and efficiently
manage their service
teams, enhancing overall
operational efficiency.
2022-
2027
15,122.1 94.4 1.2 1.2 13,436.3 170.8 170.8 797.1 626.3 455.5
Project D . . Daily
Life
System
integrator/
agent
Customer A
(2) A provider of
comprehensive urban rail
solutions primarily
engaging in general
construction, system
development and
integration services and
urban rail transit
equipment
manufacturing. Its
business has extended to
over twenty provinces
and municipalities and
over fifty cities in the
PRC, and also to
overseas customers.
Transportation
Solution
By integrating our
proprietary IoT platform
and full-stack AI
capabilities—including
speech-to-text, facial
recognition and behavior
analysis—we connect
terminal devices located
across stations and
vehicles to a unified IoT
platform. With AI-driven
image analysis and voice
coordination, we deliver
integrated hardware and
software solutions
specifically designed for
railway scenarios.
2022-
2022
12,625.5 100.0 — — 11,188.2 — — — — —
173


--- page 183 ---
Top Five
Projects
in 2022
Project
Type
Customer
Type Customer
Customer Background and
Scale of Operations
Solution
Provided Project Description
Duration
Contract
Sum (tax
included)
Percentage of
Completion
Recognized Revenue
(tax exclusive)
Backlog Contract
Value(1)
Year ended
December 31,
Year ended
December 31, As of December 31,
2022 2023 2024 2022 2023 2024 2022 2023 2024
Year

(RMB in
thousands) % (RMB in thousands) (RMB in thousands)
Project B
(phase II)
Daily
Life
Enterprise
customer
Suzhou
Chongtian
Intelligent
Engineering
Co., Ltd.
(3)
A company specializes in
intelligent space
transformation and digital
new infrastructure,
providing solution
consulting, planning and
design, equipment
provision, construction
management, system
integration, and operation
services. It is a subsidiary of
Shimao Group Holdings
Limited.
Residential
Solution
By combining our full-stack
AI capabilities—including
speech recognition, natural
language understanding,
facial recognition, speech
synthesis and specific
behavior analysis—with IoT
devices such as in-home
voice-controlled smart
screens, elevator controls
and access gates in public
areas, we create seamless
interconnectivity. This
enables property owners to
enjoy a fully integrated
experience from entering
the community to reaching
their home.
2022-
2027
13,147.9 94.1 1.2 1.2 10,946.1 139.6 139.6 686.3 546.7 407.1
Notes:
(1) Backlogged Contract Value = contract sum (tax included) /H11502recognized revenue /H11502tax
(2) This customer did not consent to the disclosure of its name in this prospectus.
(3) This customer is a subsidiary of Shimao Group Holdings Limited.
(4) For certain projects, revenue is recognized over time because such projects include standalone AI services, which are provided for a certain year of time, such as extended warranty and cloud services,
and which are considered as separate performance obligations. See “Financial Information — Critical Accounting Policies and Estimates — Revenue Re cognition.”
Top Five
Projects in
2023
Project
Type
Customer
Type Customer
Customer Background and Scale
of Operations
Solution
Provided Project Description
Duration
Contract
Sum (tax
included)
Percentage of
Completion
Recognized Revenue
(tax exclusive)
Backlog
Contract Value(1)
Year ended
December 31,
Year ended
December 31,
As of
December 31,
2022 2023 2024 2022 2023 2024 2022 2023 2024
Year

(RMB in
thousands) % (RMB in thousands)
(RMB in
thousands)
Project E . . . Daily Life Enterprise
customer
Customer D(2) A national high-tech
enterprise with strong
foundation in
technological innovation
and software
development. It provides
intelligent manufacturing
solutions, products and
technical support services
in China.
AI
Technology
Service
Based on our proprietary
Atlas AI Infrastructure,
we provide customers
with a fully integrated
hardware and software
solution, including GPU
hardware servers, for
large model training and
optimization
infrastructure.
2023-2023 21,000.0 — 100.0 — — 18,584.1 ————
174
BUSINESS


--- page 184 ---
Top Five
Projects in
2023
Project
Type
Customer
Type Customer
Customer Background and Scale
of Operations
Solution
Provided Project Description
Duration
Contract
Sum (tax
included)
Percentage of
Completion
Recognized Revenue
(tax exclusive)
Backlog
Contract Value(1)
Year ended
December 31,
Year ended
December 31,
As of
December 31,
2022 2023 2024 2022 2023 2024 2022 2023 2024
Year

(RMB in
thousands) % (RMB in thousands)
(RMB in
thousands)
Project F . . . Healthcare System
integrator/
agent
Customer E
(2) A medical device
technology company
engaged in the healthcare
sector, focusing on the
sale of medical
equipment, the system
integration in the
application of AI
technologies and the
provision of technical
services.
Efficiency
Tools for
Hospitals
By integrating our
proprietary medical voice
interaction solutions—
including speech-to-text,
command control and
report generation—we
empower healthcare
professionals in medical
imaging examinations and
report writing. This
delivers an integrated
hardware and software
solution that reduces
workloads and improves
efficiency in medical
imaging scenarios.
2023-2023 20,691.0 — 100.0 — — 18,310.6 ————
Project G . . Healthcare System
integrator/
agent
Customer E
(2) A medical device
technology company
engaged in the healthcare
sector, focusing on the sale
of medical equipment, the
system integration in the
application of AI
technologies and the
provision of technical
services.
Efficiency
Tools for
Hospitals
By integrating our full-
stack AI capabilities—
including speech
recognition, natural
language understanding,
facial recognition, speech
synthesis and specific
behavior analysis—with
IoT devices such as
multimodal interactive
screens, voice remotes,
elevator controls, facial
recognition pads, parking
access equipment and
energy monitoring
devices, we enhance
business park
management. Using
digital twin technology
and a self-developed
low-code work order
system, we enable
management teams to
deliver visualized services
to tenants and efficiently
manage their service
teams, enhancing overall
operational efficiency.
2023-2023 16,820.1 — 100.0 — — 14,885.0 ————
175
BUSINESS


--- page 185 ---
Top Five
Projects in
2023
Project
Type
Customer
Type Customer
Customer Background and Scale
of Operations
Solution
Provided Project Description
Duration
Contract
Sum (tax
included)
Percentage of
Completion
Recognized Revenue
(tax exclusive)
Backlog
Contract Value(1)
Year ended
December 31,
Year ended
December 31,
As of
December 31,
2022 2023 2024 2022 2023 2024 2022 2023 2024
Year

(RMB in
thousands) % (RMB in thousands)
(RMB in
thousands)
Project H . . Daily Life Enterprise
customer
Customer F(2) A company specialized in
the research and
development, consultation
and deployment of
enterprise information
management systems,
manufacturing
management systems,
enterprise resource
planning, manufacturing
execution systems,
artificial intelligence of
things. applications and
internet platforms whose
clientele includes
prominent domestic
enterprises.
AI
Technology
Service
We provide customers
with fully integrated
hardware and software
speech recognition
appliances, optimized for
specific hardware servers,
to deliver high-
performance and
customized solutions for
unique business
requirements.
2023-2023 16,222.5 — 100.0 — — 14,356.2 ————
Project I . . . Daily Life Enterprise
customer
Customer G
(2) A IoT products and
platform services provider
that aims to fulfill the
transformation and
upgrade needs of
industries such as
telecommunications,
energy, healthcare and
cultural tourism with its
offerings including IoT
terminals, intelligent
robots, new energy
charging and swapping
equipment and AI medical
products. Its business
reaches over twenty
regions, and it has served
major networks and
operators across China.
AI
Technology
Service
Using our proprietary IoT
platform and full-stack AI
capabilities—including
speech-to-text, facial
recognition and behavior
analysis—we connect
various devices in power
stations, especially energy
monitoring devices, to a
unified IoT platform. By
leveraging AI for data
analysis, we offer a
comprehensive smart
solution for energy
monitoring and
management.
2023-2023 14,775.8 — 100.0 — — 13,939.4 ————
Notes:
(1) Backlogged Contract Value = contract sum (tax included) /H11502recognized revenue /H11502tax
(2) This customer did not consent to the disclosure of its name in this prospectus.
(3) For certain projects, revenue is recognized over time because such projects include standalone AI services, which are provided for a certain year of time, such as extended warranty and cloud services,
and which are considered as separate performance obligations. See “Financial Information — Critical Accounting Policies and Estimates — Revenue Re cognition.”
176
BUSINESS


--- page 186 ---
BUSINESS
Top Five
Projects in
2024
Project
Type
Customer
Type Customer
Customer Background and
Scale of Operations
Solution
Provided Project Description
Duration
Contract
Sum (tax
included)
Percentage of
Completion Recognized Revenue
Backlog Contract
Value(1)
Year ended
December 31,
Year ended
December 31,
Year ended
December 31,
2022 2023 2024 2022 2023 2024 2022 2023 2024
(Year)
(RMB in
thousands) (%) (RMB in thousands) (RMB in thousands)
Project J . . . Daily Life Enterprise
customer
Customer G(2) A IoT products and
platform services
provider that aims to
fulfill the transformation
and upgrade needs of
industries such as
telecommunications,
energy, healthcare and
cultural tourism with its
offerings including IoT
terminals, intelligent
robots, new energy
charging and swapping
equipment and AI
medical products. Its
business reaches over
twenty regions, and it has
served major networks
and operators across
China.
Commercial
Space
Solution
By leveraging our
full-stack AI
capabilities—
including speech
recognition,
natural language
understanding,
facial recognition,
speech synthesis,
and specific
behavior
analysis—
combined with our
IoT platform, we
integrate
multimodal
interactive screens,
elevator controls,
facial recognition
pads, parking
access equipment,
energy monitoring
devices, and
carbon emission
monitoring
devices. With
digital twin
technology, our
self-developed
low-code work
order system, and
integration with
inventory and
purchasing
systems, we help
recycling park
management
teams visualize
and efficiently
manage their
parks, enhancing
overall operational
efficiency.
2024-2024 32,910.00 — — 100.0 — — 30,388.6 — — —
177


--- page 187 ---
Top Five
Projects in
2024
Project
Type
Customer
Type Customer
Customer Background and
Scale of Operations
Solution
Provided Project Description
Duration
Contract
Sum (tax
included)
Percentage of
Completion Recognized Revenue
Backlog Contract
Value(1)
Year ended
December 31,
Year ended
December 31,
Year ended
December 31,
2022 2023 2024 2022 2023 2024 2022 2023 2024
(Year)
(RMB in
thousands) (%) (RMB in thousands) (RMB in thousands)
Project K . . Daily Life System
integrator/
agent
Customer I
(2) A medical device
technology company
engaged in the healthcare
sector, focusing on the
sale of medical
equipment, the system
integration in the
application of AI
technologies and the
provision of technical
services.
Commercial
Space
Solution
By combining our
full-stack AI
capabilities—
including speech
input and natural
language
understanding—
with our IoT
platform, we
enable recycling
traceability and
tracking through
mobile
applications and
mini-program
interfaces. This
also includes asset
management for
recycling and
processing
equipment.
2024-2025 32,633.90 — — 0.0 — — — — — 30,209.0
Project L . . . Daily Life System
integrator/
agent
Customer J
(2) A fintech company
engaged in the corporate
credit reporting sector,
focusing on providing
corporate credit ratings,
credit investigations, and
risk management
services.
AI
Technology
Service
Based on our
proprietary Atlas
AI infrastructure,
we provide
customers with a
fully integrated
hardware and
software solution,
including GPU
hardware servers,
for large model
training and
optimization
infrastructure.
2024-2024 33,115.00 — — 100.0 — — 29,305.3 — — —
Project M . . Daily Life Enterprise
customer
Customer F
(2) A company specialized
in the research and
development,
consultation and
deployment of enterprise
information management
systems, manufacturing
management systems,
enterprise resource
planning, manufacturing
execution systems,
artificial
Transportation
Solution
Based on our
proprietary Atlas
AI infrastructure,
we offer
transportation
sector clients a
fully integrated
hardware and
2024-2024 31,448.00 — — 100.0 — — 27,830.1 — — —
178
BUSINESS


--- page 188 ---
Top Five
Projects in
2024
Project
Type
Customer
Type Customer
Customer Background and
Scale of Operations
Solution
Provided Project Description
Duration
Contract
Sum (tax
included)
Percentage of
Completion Recognized Revenue
Backlog Contract
Value(1)
Year ended
December 31,
Year ended
December 31,
Year ended
December 31,
2022 2023 2024 2022 2023 2024 2022 2023 2024
(Year)
(RMB in
thousands) (%) (RMB in thousands) (RMB in thousands)
intelligence of things
applications and internet
platforms whose clientele
includes prominent
domestic enterprises.
software solution,
including GPU
hardware servers,
for large model
training and
optimization
infrastructure.
Project N . . Healthcare Enterprise
customer
China
Resources
Medical
Equipment
(Shenzhen)
Co., Ltd.
A medical company that
primarily engages in the
research and
development,
manufacturing, sales, and
related technical services
of medical equipment.
Efficiency
Tools for
Hospitals
By integrating our
proprietary
medical voice
interaction
solutions—
including speech-
to- text, command
control, and report
generation—we
empower
healthcare
professionals in
imaging
examinations and
report writing.
This provides an
integrated
hardware and
software solution
that reduces
workloads and
improves
efficiency in
medical imaging
scenarios.
2024-2024 19,227.90 — — 100.0 — — 17,015.8 — — —
Notes:
(1) Backlogged Contract Value = contract sum (tax included) /H11502recognized revenue /H11502tax
(2) This customer did not consent to the disclosure of its name in this prospectus.
(3) For certain projects, revenue is recognized over time because such projects include standalone AI services, which are provided for a certain year of time, such as extended warranty and cloud services,
and which are considered as separate performance obligations. See “Financial Information — Critical Accounting Policies and Estimates — Revenue Re cognition.”
179
BUSINESS


--- page 189 ---
BUSINESS
Daily Life
We provide AI solutions and products supported by UniBrain. Our AI solutions package the
suitable AI engines toolbox for specific industry verticals and cater to the needs of massive number of
customers with cost-efficient customization, while our AI products, which are built on standardized
inherent system and technology but also support adaptability, provide hardware and software with
intuitive installation and deployment for developers and small and medium-sized enterprises. In
addition, we also provide AI services based on MaaS to developers and enterprises on-demand. Our
Daily Life customers include management service providers, financial institutions, software, IT and
IoT developers, hotels, public transportation operators, automakers and municipalities. The below
diagram illustrates our Daily Life offerings based on AI capabilities underpinned by UniBrain:
Customers’ Products & Solutions
Home Auto Education
Office ……
Unisound’s Products & Solutions
TransportationPark Office
……Hotel
Delivered by
Unisound
Delivered by
Customers
AI Capabilities AI Capabilities
UniBrain
The diagram below provides an illustrative workflow of how our AI technologies empower
Daily Life products and solutions across application scenarios.
Park
 Transportation
……
Hotel
Office
UniCore/UniGPT
Human-Computer Interaction
Semantic Comprehension
Dialog Management
Language Generation
Decision Support
Structurize
Analysis & Understanding
Decision Making
AI Components
IoT
Interconnection
Industry Knowledge
Graph
Multimodal
Perception
Multimodal
Generation
Video &
Audio
Home
Lighting
Energy
Control
Lock
Parking
Behavior
Control
Gate
Control
Metering
Ventilation
Elevator
Control
Delivered to Unisound’s customer
Package into a complete product
and sell to end users
Delivered to Unisound’s customer
The applications can be directly
used by end users
180


--- page 190 ---
BUSINESS
The following table sets out key metrics that provide insight into our business operations of
Daily Life for the years indicated:
For the year
ended December 31,
2022 2023 2024
Number of customers (1) .............................................. 3 7 3 3 8 9 4 1 1
Revenue per customer (2) (RMB in thousands) ............................. 1,304.8 1,487.7 1,800.0
Number of Major Customers (3) ........................................ 6 3 7 8 7 1
Revenue from Major Customers (RMB in thousands) ....................... 446,826 540,954 703,302
Customer retention rate (4) ............................................. 65.2% 68.4% 68.6%
Number of projects (5) ................................................ 5 3 7 9 1 3 7 1 1
Number of products sold ............................................. 17,353 35,677 53,399
Notes:
(1) Represents the number of customers we had revenue from during the respective years. In each year of 2023 and 2024, we had one
customer that had business with us under both Daily Life and Healthcare.
(2) Revenue per customer is calculated by dividing the revenue from Daily Life in a given year by the number of customers we had revenue
from during that year.
(3) Major Customer here refers to the Daily Life customer from whom we had revenue over RMB1 million during the relevant year.
(4) Calculated by dividing the number of customers from which we had revenue in both the current year and the immediate preceding year
by the total number of customers in the immediate preceding year.
(5) The fluctuation in the number of projects during the Track Record Period was influenced by the method of recognizing revenue based on
project progress, which resulted in some projects extending across multiple years. As a result, projects that spanned the end of a financial
year could lead to variations in the reported number of projects.
Our revenue per customer from Daily Life increased continuously from 2022 to 2024, which is
primarily as a result of our offering a wider range of AI solution offerings due to our gradually
enhanced AI capabilities. During the Track Record Period, the revenue generated from Major
Customers, as well as the customer retention rate continued to increase primarily as a result of our
enhanced AI capabilities and bolstered industry influence, which increased our ability to secure Major
Customers in the backdrop of heightened AI penetration across industries.
Solutions
Based on the AI and IoT capabilities provided by UniBrain, we provide Daily Life solutions
connecting IoT devices such as speakers, centralized voice control screens, facial recognition
equipment and multimodal interactive screens. For example, we provided Shenzhen Metro Line 20
with a voice ticketing system that integrates IoT devices, such as voice-enabled ticketing machines and
centralized control screens. The system allows passengers to purchase tickets through voice commands
in multiple languages, supported by speech recognition technologies. While such IoT devices are all
ultimately manufactured by suppliers, they consist of (i) devices that are developed by us but
ultimately produced by suppliers, (ii) devices for which we have conducted secondary development
based on the suppliers’ existing frameworks before their being produced by the suppliers, and (iii) off-
the-shelf device connected by our solutions. Our Daily Life solutions mainly feature the following
capabilities

Š Flywheel Effect of Data Training : We provide Daily Life solutions to various industry
verticals that create extensive real-life application scenarios for AI technologies, especially
conversational AI, which enables the most natural interactive communication method
between the user and our platform through voice. Our Daily Life solutions facilitate full-
scenario, human-machine interaction within individual space units such as a single room
or an entire industrial park, with varying user demand. Through continuous and
181


--- page 191 ---
BUSINESS
comprehensive user feedback from IoT devices processed through UniBrain, we have
created a virtuous cycle where our AI technologies are constantly applied and
strengthened in real-life scenarios. Our enhanced AI engines can therefore substantially
improve user experience and penetrate expanding applicable scenarios of our AI
technologies.
Š Full Scenario Coverage with Uniform Management : Our Daily Life solutions achieve
full scenario coverage through uniform management of devices, personnel, workflow and
operations to enhance operational efficiencies and improve service quality. For example,
we supported a financial conglomerate by implementing a centralized AI platform to
manage workflows, devices, and operations across multiple sectors, including insurance
and banking, which enables integrated management of processes and operations. With
uniform interconnection and management of various kinds of devices in the closed-loop
systems of different industry verticals and application scenarios, we achieve conversation-
centered interaction among multimodal IoT devices of different places within the same
system. Through uniform management of different workflows under different scenarios
and management of work orders, which covers the whole process of work order
circulation, task allocation and process management and control, we achieve consolidated
workflow management to facilitate one-stop interaction that satisfies all user demands.
Based on the uniform management of IoT devices and workflows, we enable consolidated
collection, display and analysis of various operational data, substantially enhancing user
experiences and management efficiency.
Š Multimodal Interaction Underpinned by Distributed Voice Control System : Based on
our AI and IoT capabilities, we provide diversified interaction methods, including voice
commands, mini programs and control screens, facilitating organic interaction between
people and space. For devices in the same space under the same network, our distributed
voice control system arbitrates which devices under the same network to respond based on
device information, activation status information and environmental information, realizing
a single activation demand for multiple devices. It allows all devices in the same network
to interact with users as a whole, thus improving user experience. Combined with
voiceprint recognition technology, our distributed voice control system sustains multiple
users’ separate and concurrent interactions with devices on the same network, regardless
of device locations.
Key features of our Daily Life solutions offerings:
Š Delivery Methods: We deliver to our customers one-stop services on project basis, with
our AI software, software-embedded hardware and technical services integrated according
to specific customer demands.
Š Functionalities: Our Daily Life solutions primarily enable one-stop human-machine
interaction and multimodal, conversation-centered interaction across IoT devices.
Š Core AI Technology: Our Daily Life solutions typically integrate a comprehensive suite of
our multimodal perception and generation technologies, IoT interconnection system and
industry knowledge graph with UniBrain.
182


--- page 192 ---
BUSINESS
Š Sales Cycle: To cater to customers’ needs and customization requirements, our pre-sales
team typically starts with providing a functionalities list for customers’ selection and then
proposes a delivery schedule according to customers’ specific demands. This initial
consultation typically takes one to three months. We then proceed to negotiate with our
customers on whether a show room or prototype demonstration is required, which
typically takes one to two months, subject to the customers’ internal approval procedure
before giving us final sales order. We are typically able to complete the delivery within
one month after receiving official sales order from the customer.
Š Payment: We typically determine the final price based on the total unit price of the
products selected by the customer and the level of customization performed. We may
require a prepayment of 10% to 50% of the total contract value. The remaining portion of
the contract value, excluding any quality assurance deposit, shall be paid upon completion
of final inspection. We may, depending on our relationship with the customers and the
complexity of the projects, typically agree to a quality assurance deposit of 5% to 10% of
the total contract value. Such deposit will be remitted to us upon fulfillment of a quality
assurance period which typically ranges from one to three years.
183


--- page 193 ---
BUSINESS
Through the interconnection of different levels of equipment and services, we provide one-stop
solutions to different scenarios across industry verticals including residential, commercial space,
hospitality and transportation. Our solutions combine standardized solutions for consistency and
efficiency with adaptations to meet specific customer needs. The following representative use cases
illustrate the commercialization of our solutions in such application scenarios:
Use Case 1
Shenzhen Metro Line 20
Shenzhen Metro, through its digitalization efforts, has adopted advanced technologies to its
systems and stations. We have collaborated with Shenzhen Metro and been a key technology provider
since 2021. We provide Shenzhen Metro Line 20, a fully digitalized metro line launched in 2021, with
AI interactive solutions for its ticketing system. We source electronic components for the production of
customized intelligent sound recognition and voice dialog modules built into customers’ ticketing
machines.
Intelligent sound recognition and voice dialog modules customized
for ticketing machines are built into the customer's ticketing machines.
Private Deployment
Human-Computer Interaction
Semantic Comprehension
Dialog Management
Language Generation
Structurize
Analysis & Understanding
Decision Making
AI Components
UniBrain
Multimodal
Generation
Industry
Knowledge
Graph
Decision Support
Multimodal
Perception
184


--- page 194 ---
BUSINESS
On top of the auto ticketing machines originally available in most of the metro lines, we have
added multiple functions including voice input without wakeup to facilitate easy ticket purchasing
experiences for the passengers.
185


--- page 195 ---
BUSINESS
We have installed voice ticket purchase functions to the auto ticketing machines of Metro Line
20, supporting multi-language speech recognition that covers Mandarin, English and Cantonese. Our
voice ticketing system also supports denoising and dereverberation functions ensuring accuracy in
background noise of the metro stations. Once approached by passengers, the voice model would be
automatically triggered, and the passenger’s speech would be simultaneously displayed on the screen
with support of our speech recognition and semantic understanding technologies. The system would
automatically pop up the recommended metro station based on the passenger’s voice command.
How AI technologies enabled this
In the case where a user wanted to purchase a ticket to Shenzhen North station, the user would
say to the ticketing machine that “I want to go to Shenzhen North.” The machine would collect the
user’s voice input, apply noise-cancelation and submit the processed voice sample to the cloud-based
UniBrain for analysis. The human-machine interaction module of UniBrain has been pre-trained with
massive volume of human language and voice and is therefore capable of converting the voice input to
text and analyze the meaning of such text based on its large language model capabilities and semantic
analysis AI component capabilities. Human users’ voice inputs are frequently natural language
expressions with a certain degree of vagueness instead of standardized, definitive instructions like “I
want to purchase a ticket from this stop to Shenzhen North station.” This requires UniBrain to identify
and understand the various alternative expressions of human users, and is where the perception
capabilities of large language models and semantic analysis AI components play a crucial role in the
interpretation of human users’ true intention. In this case, “I want to go to Shenzhen North” contains
multiple meanings including the intention to purchase a ticket, the specific starting point and
destination and the request for route and fee information. After deciphering the users’ true intention,
UniBrain makes decision based on the metro map and fee table, send instruction to the ticketing
machine which displays the relevant information and prompts the user to make a payment.
Use Case 2
City of Xiamen
We have in-depth cooperation with the city of Xiamen, providing park solutions for its Health
Trail, Jimei New Town and Phase III of the Software Park.
Tourist Mini
Program
Multimodal Intelligent
Interaction Station
Photo Interactive
Screen Intelligent Light Pole
Service Operation
Management System
IOC Command Center
Property
Management
Mini Program
Healthy
Trail
Park
Management Marketing
Service
Operation
186


--- page 196 ---
BUSINESS
We have installed multiple interactive screens on recreation sites along the Health Trail, all
capable of handling interactive voice commands and providing guidance and recommendation of
surrounding facilities through avatars created by our audio-visual synthesis technology. We also
provide voice-controlled photo-taking services through cameras installed in scenic spots along the trail,
enabling citizens to take photos through voice command supported by our voice wakeup and speech
recognition technologies. We source hardware for screens and develop customized software integrated
into these interactive screens.
With the support of UniBrain and our proprietary multimodal AI engines, we have installed
interactive stations in various hot spots of the Jimei New Town, providing interactive enquiry, search,
guidance and recommendations to citizens. We have also established the knowledge graph for Jimei
New Town integrating area-specific knowledge including the history and culture of Jimei, local laws,
regulations and policies and tourist attractions, providing localized information for both citizens and
tourists.
Private Deployment
Interactive screens
Human-Computer Interaction
Multimodal
Generation
Industry
Knowledge
Graph
Semantic Comprehension
Dialog Management
Language Generation
Structurize
Analysis & Understanding
Decision Making
AI Components
UniBrain
Decision Support
Multimodal
Perception IoT
Focusing on the development of AI, 5G, big data, IoT and hardware, Xiamen Software Park
Phase III has become a key technology hub in Southeast China. We have installed multimodal
interactive service stations in the office buildings, recreation sites, traffic stops and main roads of the
park, supported by the supercomputing platform we established in cooperation with the city of Xiamen
and our AI chips, integrating interactive services including speech recognition, speech comprehension,
text-to-speech synthesis and facial recognition. We also installed voice command solutions for the
elevators in the park, customized for the elevator setting with denoising and dereverberation
algorithms.
How AI technologies enabled this
In the case where a user wanted to find nearby restaurants, the user would say “restaurant” to
the multimodal intelligent interaction station. The station would capture the user’s voice and send the
voice sample to UniBrain on the cloud after noise cancelation. As the human-machine interaction
187


--- page 197 ---
BUSINESS
module in UniBrain was pre-trained with a large amount of human voice language data, it possess
human language-related knowledge and can use semantic analysis or large language models to
understand the specific meaning of the text converted from the user’s voice sample. UniBrain’s
interpretation capabilities have distinctive advantage in understanding non-regular, casual expressions
and synonyms, leveraging its broad human language knowledge base as well as ability to decipher true
intention in the context. After the interpretation of the user’s intent, UniBrain would organize
information of nearby restaurants and the best routes to those restaurants and display such information
on the screen. In this case, UniBrain needs to recognize the intention of the user behind the simple
voice input of “restaurant,” which is to find places to eat and the way to such places. Since users’
instructions are usually ambiguous due to natural language habits, AI technologies such as the
semantic analysis and large language models are crucial for understanding the user’s true intent.
Use Case 3
A financial conglomerate
We have cooperated with a financial conglomerate to provide our AI and IoT capabilities as a
combined solution for its private deployment requirements, covering end-to-end full chain support. Our
AI solutions are provided based on privatization deployment to accommodate for the sophisticated
security and privacy requirements of financial institutions.
At the infrastructure level, we established a supercomputing platform for the customer within
two months, substantially reducing the potential year-long construction time by the customer itself and
covering multiple compatible systems including high-efficiency storage and communication, high-
efficiency task allocation structure based on Kubernetes, multi-GPU acceleration for big data machine
learning, and general machine learning structure based on the above platforms. Our supercomputing
platform solution supports multiple mainstream AI computing structures of the industry and satisfies
the diverse computing demand of AI tasks.
At the application level, we have established a central AI platform providing support for both
the cloud platform and end devices. We provide interactive solutions for the end devices, and multi
dimensional support for the cloud platform including AI core engine, voice interaction support,
business interactive support, customized optimization, big data platform and operation platform. Since
the establishment of the AI platform, it has provided services to various business units of the group,
integrating the common business skills including healthcare and education. The AI platform has been
used in the verticals of insurance, banking, administration and elderly care. For example, we provide
speakers for the interactive screens at the site of the customer.
188


--- page 198 ---
BUSINESS
We procure hardware for speakers of screen and develop customized software integrated into
these speakers.
Private Deployment and Open Source Code for the Platform
Speakers with Screen
Human-Computer Interaction
Multimodal
Generation
Industry
Knowledge
Graph
Semantic Comprehension
Dialog Management
Language Generation
Structurize
Analysis & Understanding
Decision Making
AI Components
UniBrain
Decision Support
Multimodal
Perception IoT
How AI technologies enabled this
As part of the life insurance package offered by the financial conglomerate, a health safeguard
solution that consists of speakers, several physiological detection terminals and various IoT devices are
installed at a user’s home. These terminals are interconnected through the Internet to the central
artificial intelligence platform featuring UniBrain. Data is collected and aggregated in the IoT devices
and then processed by UniBrain in real-time. UniBrain analyzes the data from multiple terminals and
compares them with historical information. If any abnormalities are detected, such as high blood
pressure and poor sleep patterns, the solution promptly analyzes the situation and alerts the user
through speaker or the user’s mobile phone. At the same time, it can provide relevant health
monitoring advice based on its knowledge base. In case of emergencies, it also proactively contacts
emergency contacts to ensure the user’s safety. The health monitoring advice is mainly related to
general health care and disease prevention, and is not related to any medical advice or any advice
involving diagnosis and prescriptions. When any abnormalities are detected, the solutions notify the
user and advise the user to contact his/her family members and doctors and to undergo examinations
and medical treatment in hospitals. As mentioned above, the AI solutions is provided based on
privatization deployment. We do not collect any personal and identity data from any end users. The
data is collected and aggregated in the IoT devices and is stored on our customer’s servers. Based on
the foregoing, our PRC Legal Advisors are of the view that as of the Latest Practicable Date, (i) the
Company provides AI technologies to assist users with health monitoring and health management, (ii)
the Company does not provide health consultation and prescription services to users and is not subject
to licensing requirements of medical institutions under the PRC laws and regulations, and (iii) the
provision of the aforementioned health monitoring advice by utilizing AI technologies was in
compliance with applicable PRC laws and regulations in all material respects.
189


--- page 199 ---
BUSINESS
Products
Our products under Daily Life segment primarily consist of chips, modules and APIs. The
following table sets out a breakdown of our revenue by product in absolute amounts and as a
percentage of revenue for the years indicated:
Year Ended December 31,
2022 2023 2024
Amount
(RMB in thousands) %
Amount
(RMB in thousands) %
Amount
(RMB in thousands) %
Chips ...................... 45,865 49.1 66,908 64.6 76,419 65.2
Modules ................... 30,155 32.3 27,022 26.1 34,149 29.1
APIs ...................... 5,688 6.1 3,537 3.4 4,965 4.2
Other products(1) ............ 11,776 12.6 6,031 5.8 1,763 1.5
Total ...................... 93,484 100.0 103,498 100.0 117,296 100.0
Note:
(1) Other product primarily include intelligent alarm clock and intelligent speaker.
Š Chips and Modules : AI chips are semiconductors that can perform AI tasks, such as
image recognition, natural language processing and machine learning. We offer two types
of AI chips to our customers: (i) self-developed chips, targeting at customers and use cases
with more stringent and cutting-edge performance requirements, and (ii) third-party chips,
which are primarily used in more standardized use cases and offer high cost efficiency.
To cater to certain customers’ stringent performance requirements, we decide and design
the key technical specifications and logic of the self-developed chips in-house. This means
we decide how the chip will function, write the code that controls the chip and test the
chip’s performance to verify our designs. Our design focuses on optimizing the chips’
performance in accelerated AI algorithm computation, and is sent to third-party foundries
for manufacturing. Alongside the chip hardware, we offer customers a full suite of our
proprietary algorithm application development framework, conversational AI developer
tools and other supporting tools based on the specifications and functionalities of the
chips, to facilitate our customers’ further development. We hold the IP rights of the overall
design of self-developed chips, including its hardware structure and associated software.
For more standardized use cases, we use the third-party chips for cost efficiency. We buy
ready-made chip hardware suitable for the development of AI algorithms and applications
from other chip providers. When selecting the third-party chips, we assess and balance the
performance, power consumption and hardware costs. Similar to self-developed chips, we
also offer a full suite of proprietary algorithm application development framework,
conversational AI developer tools and other supporting tools. We own the intellectual
property rights of the software used in connection with the third-party chips.
The proprietary algorithm application development framework, conversational AI
developer tools and other supporting tools centers on our conversational AI engine, which
can be embedded in the AI chips and can understand and execute voice commands. A
series of our developer tools help customers customize the voice commands for their
products and improve the accuracy of the AI chips. Customers can upload a list of voice
190


--- page 200 ---
BUSINESS
commands to our web-based tool platform, which then creates a customized firmware that
matches these commands. The firmware can be downloaded and installed on the AI chips
that customers have purchased from us. Our developer tools enable customers to
customize their products without relying on manual support from us, to fine-tune the
performance of the AI chips and the voice commands, and to facilitate faster and easier
product development and deployment. This saves time and cost, improves quality and
functionality, and gives customers a competitive edge in the market. As of the Latest
Practicable Date, we have developed and sold AI chip products that, in addition to the
current voice control function, support the integration of more functions such as bluetooth
and master control. The following table sets out a breakdown of our revenue generated
from self-developed chips and third-party chips for the years indicated:
Year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except percentages)
Self-developed chips .................... 3 5 8 0 . 8 1,910 2.9 6,438 8.4
Third-party chips ....................... 45,507 99.2 64,999 97.1 69,981 91.6
Total ................................. 45,865 100.0 66,908 100.0 76,419 100.0
We also deliver AI modules, which are hardware devices and components integrated with,
and enhanced by, AI chips which are embedded with our AI engine. As AI modules are
often highly customized, an AI module is typically developed based on the specific
requirements of an AI device, including its functionality, structure and exterior design. It
integrates multiple chips, including the AI chips, onto a single PCB. In addition to the AI
chips, there are generally capacitors, resistors, inductors and MCU chips on the AI
modules. For AI chips, our involvement in design and development does not extend to
customization for specific user scenarios. Customers are generally required to undertake
secondary development of the AI chips to ensure they are suitable for their unique user
scenarios before they can move forward with production. In contrast, AI modules are
crafted as plug-and-play components. Customers can seamlessly integrate these AI
modules into their final products, ready for mass production and assembly, eliminating the
need for any supplementary development to align with user needs. In 2022, 2023 and
2024, revenue from our AI modules amounted to RMB30.2 million, RMB27.0 million and
RMB34.1 million, respectively, accounting for 6.2%, 4.7% and 4.6% of our revenue from
Daily Life, respectively.
Furthermore, our AI solutions are tailored to customers’ particular requirements, typically
encompassing software, hardware and development and support services. These solutions
are typically developed for specialized use cases, with each project potentially requiring
different functionalities and quantities of software, hardware and services.
191


--- page 201 ---
BUSINESS
When components such as AI modules and AI chips are integrated into various electronic
devices, they form an AI device. Based on the needs of our customers, we provide AI solutions
featuring our UniBrain, software systems and AI devices related to customer needs. This approach
gives us the flexibility to provide highly customized solutions to customers.
AI ModuleAI Chip
Key features of our AI chip and AI module offerings:
Š Delivery Methods: The AI chips are delivered as standardized chip hardware together
with related support tools for customization, while the AI modules are typically
delivered as hardware devices and components to IoT device manufacturers.
Š Functionalities: Our AI chips and AI modules empower the intelligentization of
various AI IoT devices across industry verticals, performing functions including
information perception, structuralization, analysis and decision assistance.
Š Core AI Technology: Our AI chips and AI modules typically involve embedding
specific multimodal perception and generation technologies and IoT interconnection
system capabilities into the relevant chips or hardware devices. These chips and
devices may also call the AI capabilities from our UniBrain as needed.
Š Sales Cycle: The sales cycle of AI chips is typically swift. Most of the orders for AI
chips are one-off purchases and are typically fulfilled in one month. The sales cycle
of our AI modules primarily comprises initial consultations with our customers,
customized product R&D and execution of framework agreements, which may take
two to six months. Under the framework agreements, our customers place specific
orders according to operating needs from time to time. The AI modules are typically
delivered in one month to 45 days.
Š Payment: We typically determine the final price based on the total unit price of the
products selected by the customer and the level of customization performed. For AI
chips, payments are required upfront. Payments for AI modules are typically settled
upon delivery of the products. Revenue is typically fully recognized upon completion
of the one-off post-delivery inspection and issuance of acceptance confirmation.
Š APIs: We provide AI capabilities based on MaaS to developers and enterprises on-
demand in the form of public cloud AI capability APIs and customized proprietary AI
technology service platforms.
Key features of our AI capability offerings:
Š Delivery Methods: We grant our customers access to our cloud-based AI technology
service platforms.
192


--- page 202 ---
BUSINESS
Š Functionalities: Our AI capability APIs offers various machine learning technologies
to empower the development activities of our users.
Š Core AI Technology: The AI capabilities provided are primarily from UniBrain.
Š Sales Cycle: We may offer free trials of our AI capabilities to potential customers
who send inquiries to us via our website. If satisfied with the functionalities and
performance, potential customers are then invited to send their specific fee inquiries
to us. Our implementation team typically take two to three weeks to respond to the
specific inquiries with tailored service plans, upon agreement of which we proceed
with the customer to enter into contracts. The access to our AI capability APIs is then
instantly available to customers.
Š Payment: We charge subscription fees for such services on a pay-per-use basis.
During the Track Record Period, such subscription fees were insignificant to our total
revenue.
Use Case 4
Automobile
Our Automobile products create travel experiences that connect people and vehicles.
We are responsible for
the development of the SDK in
the central control screen
publicize
Human-Computer Interaction
Multimodal
Generation
Industry
Knowledge
Graph
Semantic Comprehension
Dialog Management
Language Generation
Structurize
Analysis & Understanding
Decision Making
AI Components
UniBrain
Decision Support
Multimodal
Perception IoT
With our conversational AI capabilities at its core, our Automobile products can be connected
to cloud environment and support scenario-based big data operation service capabilities, as a part of
the intelligent upgrade of traditional vehicles. We started by providing aftermarket installed products
which integrate our core AI public cloud services including speech recognition, NLU and TTS
synthesis for brands and manufacturers of cameras, rear-view mirrors and dashboards, which
subsequently were installed on tens of millions of automobile devices. We now provide one-stop
conversational interaction solutions, including conversational interaction SDK and conversational
cloud services, to established car manufacturers with a need for intelligent upgrades. We also
collaborate with some car manufacturers’ solution providers and provide NPU for their vehicle-grade
AI chips by authorizing the IP of the design of NPU to such solution providers, who then incorporate
the NPU design into their vehicle-grade AI chips. To authorize the IP of our NPU design to solution
193


--- page 203 ---
BUSINESS
providers, a licensing agreement is established between the solution provider and us. Under this
agreement, the solution provider is granted the rights to use the NPU IP developed by us in their AI
chip designed for vehicular use. For each chip delivered by the solution provider that incorporates the
NPU IP, we typically earn a fixed fee based on the IP licensing agreement.
The below is the typical process in our NPU IP authorization:
Unisound
1  electrical design blueprint
of NPU for the production
of chip hardware
NPU IP solution
provider
foundry
downstream customers
(e.g. car manufacturers)
chip design firm
2  delegate design and
production of chips
4  deliver finished
product of
chip hardware
5  software and hardware with
vehicle-grade voice AI chips
3  delegate production
and delivery of chips
The solution provider obtains the NPU IP license from us, and then provides this NPU IP to a
chip design firm, which is responsible for integrating the NPU IP into the overall design blueprint of
the targeted AI chip. Once the design is finalized, it is sent to a foundry for manufacturing. The
manufactured chips are then delivered to the solution provider. The solution provider bundles the chip
hardware with software and delivers the complete package to their customers, such as car
manufacturers.
We also established a joint venture with ECARX in Anhui, focusing on factory-installed
products. We offer speech recognition services covering Mandarin, Sichuan dialect, Cantonese and
English. Such services have been subsequently incorporated in millions of automobiles of top-tier car
manufacturers.
194


--- page 204 ---
BUSINESS
Healthcare
Our Healthcare solutions started from providing efficiency tools, and gradually expanded to
provide a broad range of medical quality management solutions for relevant medical institutions,
insurance companies and authorities, integrating various decision-making products and solutions to
meet the requirements of quality control and compliance of relevant institutions, with the ultimate goal
of improving the work efficiency of medical staff and enhancing the service standards of medical
institutions. The below diagram illustrates our Healthcare offerings:
UniBrain
Quality Control/Compliance/Decision Support
Medical Quality Management Solutions
CDSS Based on LLM
Diagnosis Treatment
Efficiency Tools for Hospitals
Medical Voice
Interaction Solutions
Medical Record
Transcription
Voice Assistant
Ultrasound, Pathology, Stomatology
Clinic Medical Record
Generation System
Surgical Record
Assistant
Hospital
Service Solutions
Robot Guide
Robot Service
Registration
Follow-up
Medical
Record
Quality
Control
Service
Supervision
Payment
Management
Medical
Knowledge
Graph
The diagram below provides an illustrative workflow of how our AI technologies empower
Healthcare solutions.
Hospital Information
System
Data Interface
Output Content
Integration
Hospital Business
System
UniCore/UniGPT
Industry
Knowledge Graph
Multimodal
Perception
Multimodal
Generation
UniBrain
Human-Computer Interaction
Semantic Comprehension
Dialog Management
Language Generation
Decision Support
Structurize
Analysis & Understanding
Decision Making
Medical Record in
Natural Language Form
Clinical
Decision-making
AI Components
Hospital
Sold to
Hospitals
Imbed into
Store Infomation
195


--- page 205 ---
BUSINESS
The following table sets out key metrics that provide insight into our business operations of
Healthcare for the years indicated:
For the year
ended December 31,
2022 2023 2024
Number of customers (1) ............................................... 1 6 5 1 6 7 1 6 6
Revenue per customer (2) (RMB in thousands) .............................. 687.6 887.7 1,200.0
Number of Major Customers (3) ......................................... 2 9 2 6 3 5
Revenue from Major Customers (RMB in thousands) ........................ 91,784 125,480 171,833
Customer retention rate (4) .............................................. 70.4% 64.8% 53.3%
Number of projects (5) ................................................. 2 2 8 2 4 2 2 3 2
Notes:
(1) Represents the number of customers we had revenue from during the respective years. Such number represents the number of (i)
enterprise customers with whom we directly entered contract into and to whom we provided solutions, and (ii) end users to whom we
provided solutions through contracts with system integrators/agents. We consider such metrics as key in evaluating our business
operations because it reflects our performance in expanding our Healthcare business. Due to the nature of the industry, it usually is a
commercial decision that the system integrators/agents, rather than the end users themselves, enter into contracts with us, although it
typically is the end users that take the lead in coordinating the system integrators/agents and us to deliver the projects to and realize AI
intelligence upgrade on the end users themselves. See “- Sales and Marketing – Our Sales Network.” In addition, in each year of 2023
and 2024, we had one customer that had business with us under both Daily Life and Healthcare.
(2) Revenue per customer is calculated by dividing the revenue from Healthcare in a given year by the number of customers we had revenue
from during that year.
(3) Major Customer here refers to the Healthcare customer from whom we had revenue over RMB1 million in a year.
(4) Calculated by dividing the number of customers from which we had revenue in both the current year and the immediate preceding year
by the total number of customers in the immediate preceding year.
(5) The fluctuation in the number of projects during the Track Record Period was influenced by the method of recognizing revenue based on
project progress, which resulted in some projects extending across multiple years. As a result, projects that spanned the end of a financial
year could lead to variations in the reported number of projects.
The continuous increase in our revenue per customer from Healthcare during the Track Record
Period was primarily driven by UniBrain’s enhanced AI capabilities, which enabled us to offer more
sophisticated and advanced solutions at a higher price. We consider the number of and revenue from
our Major Customers to be important metrics of our success. During the Track Record Period, although
our Major Customers under Healthcare constituted 17.6%, 15.6% and 21.1%, respectively, of our total
Healthcare customers by number, the total revenue they contributed accounted for 80.9%, 84.6% and
86.3%, respectively, of the aggregate revenue from Healthcare. Revenue from Major Customers
increased at a CAGR of 36.6% from 2022 to 2024. Our customer retention rate decreased from 70.4%
in 2022 to 53.3% in 2024 primarily because, leveraging our customer acquisition resources, we have
been putting our business emphasis on acquiring customers with higher spending with us. Revenue per
customer increased from RMB687.6 thousand to RMB1,200.0 thousand over a CAGR of 32.1%. This
is because, when customers deploy our products, their data and system integrate with our products,
thereby giving us an infrastructural and early-mover advantage at this stage in the customers’
procurement and deployment of our other AI products in the long run. See “-Business Sustainability -
Expanding customer base and retaining existing customers.”
We have built the core capabilities of Healthcare solutions, including data interface, medical
record full-text comprehension, and knowledge graph construction and application, and packaged such
capabilities into products and launched to the target customers, catering to their demand and market
responses. Through continued usage of our products, we can feed our products with feedbacks and
form a self-reinforcing development cycle of our solutions.
196


--- page 206 ---
BUSINESS
Key features of our Healthcare solutions offerings:
Š Delivery Methods: Our Healthcare solutions are typically delivered as customized one-
stop AI-empowered business systems, where a selection of our AI soft- and hardware are
integrated according to specific customer demands. We also provide standardized
efficiency tools based on conversational AI capabilities.
Š Functionalities: Our Healthcare solutions are primarily applied in medical record voice
entry, medical record quality control, single-disease quality control and medical insurance
payment management, leveraging voice-based interaction technologies and medical
knowledge.
Š Core AI Technology: Our Healthcare solutions primarily integrate a comprehensive suite
of our multimodal perception and generation technologies with medical knowledge graph
and UniBrain.
Š Sales Cycle: Healthcare solutions typically have longer initial consultation period with
potential customers, ranging from three months to two years, after which process we
proceed to enter into contracts with the customers. We are typically able to complete the
delivery in one to six months after entering into contracts.
Š Payment: We may sometimes require a prepayment of 10% to 50% of the total contract
value. The remaining portion of the contract value, excluding any quality assurance
deposit, shall be paid upon completion of final inspection. We may, depending on our
relationship with the customers and the complexity of the projects, typically agree to a
quality assurance deposit of 5% to 10% of the total contract value. Such deposit will be
remitted to us upon fulfillment of a quality assurance period which typically ranges from
one to three years.
Efficiency Tools for Hospitals
We offer a suite of efficiency tools for hospitals leveraging our conversational AI and large
language model capabilities. Our solutions can substantially improve the efficiency of medical record
entry and patient service.
We offer the following solutions to support doctors and patients:
Medical Voice Interaction Solutions : Our medical voice interaction solutions support doctors
through efficiency tools such as voice assistants for hospital departments and medical record
transcription.
Š Voice assistant: Based on our AI capabilities and the intelligent interpretation of healthcare
knowledge graph, our voice assistant offers doctors convenient voice interaction functions to
make medical inspection report. For example, it automatically filters information irrelevant to
the examination content with semantic understanding, and can directly interface with PACS,
thus supporting voice entry of report content while collecting and selecting images. We
provide voice recognition models for departments of ultrasound with more accurate
recognition rate, customized for specialty-specific jargons and symbols.
Š Medical record transcription : Our medical record transcription system offers doctors a
voice-enabled method of medical documentation through our conversational AI capabilities. It
substantially improves the efficiency of record entry, alleviating doctors’ logistic burden. The
system enables real-time charting for outpatient visits and inpatient treatment, as well as
197


--- page 207 ---
BUSINESS
medical examination and test report generation. It supports a comprehensive set of features
including voice wakeup, intelligent punctuation and professional vocabulary customization to
facilitate transcription with a high accuracy rate of over 98%. In addition, it enables structured
medical records to support subsequent data analysis and knowledge graph generation.
Use Case 5
We implemented the audio medical record transcription system for Peking Union Medical
College Hospital. We source microphones from suppliers, develop the software in-house, and then
deliver the product as a software bundled with the microphones. The system provides sub-scenario
support for over 40 clinical and medical technical departments throughout the hospital. The voice
recognition improves the input speed significantly, with an accuracy rate of over 98%. The system
delivered an outstanding service especially in departments with higher demand for accurate and
delicate medical record, such as neurology, immunology, hematology and general internal medicine,
where the doctors are able to spend more time communicating with patients.
198


--- page 208 ---
BUSINESS
How AI technologies enabled this
The essence of the voice electronic medical record product is to convert the doctor’s voice into
the appropriate text and to ensure the accuracy of the conversion. With AI technology support, doctors
do not have to type at a rate that could easily be lower than 60 words per minute. Instead, they can
enter the same information by speaking at a rate as high as 180 words per minute, thereby greatly
improving the medical record entry efficiency and saving doctors time spent on logistics tasks. With
specialized knowledge including acoustic knowledge and medical linguistic knowledge, we train a
dedicated AI algorithm model to function as the core module of the audio medical record transcription
system, as illustrated in the following chart.
Real-time
recording
Acoustic model
Speech recognition engine
Medical language
model/knowledge
graph
Medical record
document
When the doctor says the contents for the medical record, the voice is fed into the speech
recognition engine in real-time. The speech recognition engine queries the acoustic unit and the
medical language unit (which contains the information of the medical knowledge graph), and matches
the voice input to the corresponding text and outputs the text. Such process is equivalent to an AI
assistant understanding a doctor’s voice output and transcribing it.
Hospital Service Solutions : Our hospital service solutions achieve comprehensive patient care
including robot guide, registration and follow-up.
199


--- page 209 ---
BUSINESS
Š Robot guide : The medical robot guide integrates traditional hospital reception desk
processes and offers one-stop consultation services for patients. It interacts with patients,
inquires symptoms and guides them to relevant departments according to patient’s specific
issues. We also intend to leverage UniGPT capabilities to upgrade robot services and
achieve full digital coverage of treatment processes.
Š Registration: With our intelligent voice interaction and registration system, we offer
patients with remote access to registration and submission of preliminary medical
information through a human-machine dialog.
Š Follow-up: Our follow-up system schedules and conducts automated follow-up with
patients after their discharge from the hospital. It records patients’ health condition, sends
reminders for re-visits. The system also provides health guidance to patients including
medical, nursing and rehabilitation measures after discharge from the hospital.
We are also in the process of developing the below pipeline products based on our UniGPT:
Š Upgrading of existing products based on multimodal large models : With the
strengthened performance of LLM technology in data understanding, extraction,
standardization and generation, the data adaptation, intelligent analysis, and user
interaction capabilities of existing products are enhanced.
Š CDSS products based on multimodal large models : We are further developing our
CDSS products such as multimodal medical imaging quality control based on the
capability of UniGPT in understanding and analyzing multimodal medical data, and with
the support of mapping technologies.
Medical Quality Management
We offer a broad range of medical quality management solutions for hospitals and insurance
companies to improve their service quality and ensure compliance with relevant regulations through
AI-empowered enhancement. Leveraging our experience in the healthcare area, we have combined our
AI capabilities with the business systems of the relevant institutions to achieve comprehensive
management of service quality. Our medical record quality control solutions apply AI capabilities to
understand the content of medical records and other medical data, analyzes the doctor’s decisions, and
performs defect checking and alerting. The system improves the quality of medical record, medical
service quality, professional performance in key departments, compliance with medical insurance
regulations, and cost control. We also help hospitals provide higher quality and safer treatment services
through provision of service supervision solutions, and also meet the corresponding regulatory
requirements. We provide payment management solutions to hospitals and insurance companies to
manage their medical insurance payment. In addition, we also provide innovative applications
supported by medical knowledge graph.
Medical Record Quality Control
Leveraging our NLP technology and medical knowledge graph, we offer medical record quality
control platform that supports medical record review, decision making and case summarization by the
doctors, providing them with convenient and intelligent medical record review and analysis tools. We
improve the process of medical record quality control by applying AI capabilities to understand the
medical records and perform defect screening to address the deficiencies in medical records.
200


--- page 210 ---
BUSINESS
Our medical record quality control platform provides feedback from the perspective of
accuracy, completeness and timeliness through intelligent cross-checking and verification of medical
record compliance requirements. The platform also helps the professionals identify conflicts and
missing information in the medical records based on the knowledge graph with respect to the
concerning disease, enabling the professionals to timely correct and make amendments.
In addition, the medical record quality control platform assists to improve the internal quality
control workflow. It automatically conducts statistical analysis on the quality of medical records by
evaluating the completeness, correct rate of major diagnoses, defect number and other performance
data, offering decision support for quality control policy formulation and improvement.
Use Case 6
We offer a medical record quality control system through application software based on
browser/server architecture for Beijing Friendship Hospital to help doctors screen for medical record
defects, standardize medical record writing style, improve medical record quality, and enhance the
quality and safety of medical treatment. Our system performs periodical quality control of medical
201


--- page 211 ---
BUSINESS
records during the patient’s hospitalization and final quality control of medical records after the patient
is discharged, and automatically rates the quality. With the huge number of patients discharged from
the hospital, our system covers the entire quality control process, from paperwork review and defects
detection to targeted verification of defects automatically screened by the system. The system
substantially improves the efficiency and effectiveness of the medical record quality control work. The
coverage of medical records has increased from 2-5% to 100%, with an accuracy of over 90% and a
detection rate of over 85%.
How AI technologies enabled this
The essence of the medical record quality control product is to (i) analyze the natural language
text of the medical record; (ii) extract the key information; (iii) enquire the built-in medical knowledge
graph with key information; and (iv) identify illogical or unreasonable items and provide feedback to
the doctors. This process is essentially similar to a medical expert reading the medical record and
reviewing its content for irregularities.
For the product to read the medical record, we first developed a natural language processing
module that allows AI to process text written in human language patterns and convert it into structured
content elements that can be easily processed by the machine. Subsequently, AI compares these
elements with the built-in medical knowledge graph to identify potential contradictions and
irregularities among the elements. The complexity of this comparison process goes beyond simple text
and data matching, and is supported by a wide range of AI technologies such as natural language
processing and large language model perception and generation capabilities, as illustrated in the
following chart.
Medical record
document
Deficiencies
notices
Natural language
processing
module
Medical record quality control
products
Medical
knowledge
graph
Large language
model
202


--- page 212 ---
BUSINESS
Medical Record Database
(Highly Structured)Medical Record Database
Data Storage
Third-party System Medical Record Quality Control Management System
Data Adapter Medical Record Quality Control AI Engine
Post-Structured Engine
NLU/NLP
EMR HIS Medical Record Inquiry and Browsing
UniGPT
Quality Control Reminder and Alarm
Statistical Analysis of
Quality Control Results Quality Control Engine Device
Adapter
1
Adapter
2
Adapter
3
Adapter
N Language
Generation
Semantic
Comprehension Q&A Logical
Reasoning
Domain
Enhancement
Knowledge
Graph
Data CenterIntegration Platform
203


--- page 213 ---
BUSINESS
Service Supervision
We offer the single-disease data reporting system, which is a quality control platform for single
disease that comprises functions of reporting on the individual disease, indicator evaluation on the
single disease and treatment process management for the single disease. This system aims to help
hospitals automate relevant data reporting processes and improve the quality of diagnosis and
treatment of single diseases. See “- Overview - AI Application Solutions.”
Payment Management
When a patient is in hospital, doctors’ diagnosis and treatment incur the corresponding medical
expenses. When the patient is discharged, the patient settle the portion of the medical expenses that
they are personally responsible for, and does not pay the portion of the medical fees covered under
medical insurance, which is advanced by the hospital. After the patient is discharged, the hospital
applies for reimbursement from the relevant medical insurance administrative authorities for the
portion of the medical fees covered under medical insurance, that is, the sum advanced by the hospital.
The relevant medical insurance administrative authorities review the hospital’s reimbursement
application, deduct non-compliant charges, and only reimburse compliant charges. After the relevant
medical insurance administrative authorities complete the review, they reimburse the hospital the
portion of medical fees that is compliant.
Admitted to hospital
Patient Patient being admitted
to the hospital
Patient settles the payment upon discharge (the portion of
medical expenses that shall be paid by the patient)
The portion of medical expenses seeking reimbursement from
medical insurances (advances paid by the hospital)
Review fees
Deducts non-compliant charges
Reimburses compliant charges
Reimburses the
hospital the expenses
that are compliant
Case closed
Apply for expense reimbursement from the
relevant medical insurance administrative authorities
Diagnose the patientDoctor
Hospital
Medical Insurance
Administrative Authorities
Discharged from hospital
204


--- page 214 ---
BUSINESS
We have developed Medical Insurance Supervision Platform and Medical Insurance Payment
Management System for Hospitals, which are both intelligent application systems for the reasonable
use of the medical insurance fund.
Medical Insurance Supervision Platform
The social medical insurance fund supervision platform helps the relevant medical insurance
administrative authorities and the third-party companies to whom such administrative authorities
outsource the reimbursement review to identify irregular charges. It is supported by a medical rule
database developed based on national, provincial and municipal medical and health-related policy
documents, clinical knowledge base and expert review results of medical insurance records. It applies
AI technology to automatically review the documents uploaded by medical institutions to accurately
identify the documents with issues of insurance fraud and irregularities, such as excessive medical
treatment, duplicate examinations and misuse of drugs.
Medical Insurance Supervision
Platform
Reviews documents for the relevant
medical insurance administrative
authorities and third-party companies to
whom the relevant medical insurance
administrative authorities outsources
the reimbursement review to identify
irregular charges
Admitted to hospital
Patient Patient being admitted
to the hospital
Patient settles the payment upon discharge (the portion of
medical expenses that shall be paid by the patient)
The portion of medical expenses seeking reimbursement
from medical insurances (advances paid by the hospital)
Review fees
Deducts non-compliant charges
Reimburses compliant charges
Reimburses the
hospital the expenses
that are compliant
Case closed
Apply for expense reimbursement from the
relevant medical insurance administrative authorities
Diagnose the patientDoctor
Hospital
Discharged from hospital
Medical Insurance
Administrative Authorities
205


--- page 215 ---
BUSINESS
Medical Insurance Payment Management System for Hospitals
Our social medical insurance payment management system provides decision support for
hospitals in maintaining compliance with diagnosis, treatment and disbursement regulations, especially
for the compliance for the reimbursement from the relevant medical insurance administrative
authorities. Through intelligent analysis of medical and fee records during the treatment, the system
automatically audits treatment and disbursement processes, examines the consistency of treatment and
charges, and helps hospitals and doctors to identify non-compliance issues. Such issues normally
include repetitive and non-compliant medication, excessive treatment, bundle sales, and medication,
treatment and examination without indications.
Admitted to hospital
Patient being admitted
to the hospital
Patient settles the payment upon discharge (the portion of
medical expenses that shall be paid by the patient)
The portion of medical expenses seeking reimbursement from
medical insurances (advances paid by the hospital)
Review fees
Deducts non-compliant charges
Reimburses compliant charges
Reimburses the
hospital the expenses
that are compliant
Case closed
Diagnose the patient
Medical Insurance Payment
Management System for Hospitals
Reviews treatment for hospitals to
timely discover non-compliant
incidents during diagnosis and
treatment, thus prevents the
occurrenceof irregular charges
Patient
Doctor
Hospital
Discharged from hospital
Apply for expense reimbursement from the
relevant medical insurance administrative authorities
Medical Insurance
Administrative
Authorities
Commercial Insurance Supervision and Audit System for Insurance Companies
Based on the best practices accumulated in medical insurance fund supervision and auditing,
we extend to other business areas of commercial insurance, such as supervision and auditing of
personal injury cases for auto insurance. We offer commercial insurance companies with intelligent
systems for auditing and statistical analysis of policy claims, using natural language understanding,
knowledge graph and other technologies. Specifically, for commercial insurance claims, an applicant’s
claims need to be reviewed to determine whether the claims should be settled or be rejected, as well as
the amount to be settled. The review was typically done manually. However, with our commercial
insurance supervision and audit system for insurance companies, the applicant’s claim materials can be
processed automatically, and a reimbursement plan will also be generated automatically, thereby
improving the efficiency of commercial insurance reviews.
206


--- page 216 ---
BUSINESS
Applicant
Loss incurred
Applicant
Submit claim
materials Reimbursement
case concluded
Insurance
companyClaim review and
approval
Insurance company
Commercial Insurance Supervision
and Audit System for Insurance Companies
Reads applicants’ claim materials, and automatically
provide a reimbursement plan for the insurance company
Medical Knowledge Graph
With our deep learning capabilities, we establish the structure of knowledge graph in the
healthcare industry based on a medical concept hierarchy, according to the international medical
terminology sets. We build the knowledge graph using information extracted from authoritative
medical texts such as clinical guidelines and drug instructions, combined with clinical practice
knowhow, and draw connections between concepts and facts.
We are also in the process of developing the below pipeline products based on our UniGPT:
Š The Upgrade of Existing Products Based on LLM : Leveraging on the excellent
performance of large language model technology in data digestion, extraction,
standardization, and generation, we can substantially enhance the data adaptation,
intelligent analysis, and user interaction capabilities of our existing products.
Š CDSS Product Based on LLM : Based on UniGPT’s capability to understand and analyze
multimodal medical data, with further support of clinical knowledge graph, we are
developing our CDSS product integrating medical record documentation quality control,
medical service quality control and medical insurance cost supervision, with the same user
interface as the medical quality management solutions, providing a comprehensive and
unified decision support system for doctors and hospital managers.
ATLAS AI INFRASTRUCTURE
Our Atlas AI infrastructure supports our research and development through large-scale machine
learning and big data processing capabilities. It is underpinned by its (i) intelligent computing cluster,
(ii) machine learning algorithms, and (iii) data-centric model training:
Š Intelligent Computing Cluster : Our intelligent computing cluster provides unified
management and dynamic scheduling of computing power for simultaneous model
training on large data. The efficiency and flexible scalability of the computing power of
our intelligent computing cluster constitute our core competitive strengths in advancing
our AI algorithms, models and solutions, especially for large language models. Currently,
the total computing power exceeds 184 PFLOPS, with storage capacity of over 10PB, both
of which can be expanded without interrupting training tasks.
Š Machine Learning Algorithms : Leveraging the intelligent computing cluster, we can
explore cutting-edge machine learning algorithms for speech, language, knowledge and
207


--- page 217 ---
BUSINESS
visual models, and evaluate their performance on standard benchmark and large-scale
application data. After completing the validation of new algorithms, we will quickly
upgrade our AI engines, training tools and related models to maintain our technological
leadership advantage. Our machine learning algorithms serve as our core method for
producing high-precision AI models and optimizable AI engines.
Š Data-centric Model Training : With advanced machine learning algorithms and efficient
intelligent computing cluster, we have built a data-centric model training platform,
empowering industry-level applications and performing rapid model iteration and fine-
tuning. The platform is critical for efficient AI model evolution, especially for large
language model, which has significant demand for parallel computing, and needs to be
trained by large-scale high quality training data. We accelerate training process by parallel
computing of data, model and pipeline, improving theoretical efficiency of hardware to
more than 50% (as compared to less than 40% efficiency without pipeline parallelization).
The platform also provides important and efficient de-duplication, de-noise and selection
of 10TB-scale data to improve the quality and diversity of training data.
OUR CORE AI TECHNOLOGIES
One of the key factors that distinguishes us from peers is our Atlas AI infrastructure. This AI
infrastructure performs (i) the dynamic dispatch of computing power resources based on shifting
business demands; (ii) the initial training of large language models based on massive volume of data;
and (iii) efficient optimization guided by selected high-quality user feedback. Based on the Atlas AI
infrastructure, we built our central technology platform, UniBrain, with UniGPT as its core,
encompassing the closed-loop human-machine interaction from signal perception to semantic
understanding, knowledge graphs, reasoning and decision-making which ends with generation of
responding information. On top of our core conversational AI technologies, we have expanded to multi
modal perception and generation capabilities including facial recognition, OCR and audio-visual
synthesis (AVS), continuously enhancing our core AI technologies. We house the following
proprietary core AI technologies:
Large Language Model (LLM)
Our large language model UniGPT is the core of UniBrain, which determines the cognitive and
business processing capabilities of the system and is the key to our MaaS-based business model. The
large language model builds powerful general-purpose basic capabilities through unsupervised pre-
training, instruction fine-tuning and RLHF. Underpinned by plug-in extension, domain enhancement
and customization, we have facilitated the on-the-ground application of large language model across
industry verticals.
Š Building General-purpose Capabilities : It is a key step toward the new paradigm of
AGI. Through unsupervised pre-training of massive text and code data, as well as
instruction fine-tuning and RLHF technologies, our large language model is capable of
language generation, semantic understanding, knowledge Q&A, logical reasoning,
mathematical calculation and code generation, providing flexible responses to various
tasks and achieving human-like AGI capabilities.
O Unsupervised Model Pre-training : We have established a GPT model training
framework with trillion-level Tokens and 60 billion-level parameters. Such
framework supports parallel training acceleration, including parallel mechanisms for
208


--- page 218 ---
BUSINESS
data, models and pipelines. We have established a watch-dog system for checking the
operational status and healthiness of model training. Through unsupervised pre-
training of massive text and code data, we have trained a powerful general-purpose
base model, laying the foundation for subsequent instruction fine-tuning and RLHF.
O Instruction Fine-Tuning : By introducing instruction fine-tuning technology, the
large language model can understand human intent and handle various language-
related tasks, including language generation, semantic understanding, knowledge
Q&A, logical reasoning, mathematical calculation and code generation, building a
helpful and powerful model with general-purpose capabilities. It also supports LoRA,
low-rank adaptation of large language models, a training method that accelerates the
training of large language models while consuming less memory, and other parameter
efficient fine-tuning mechanisms, which can perform instruction fine-tuning
efficiently and thus swiftly extend the model capabilities.
O RLHF: The introduction of reinforcement learning from human feedback (RLHF)
technology makes the generated results of the large language model as useful, factual
and harmless as possible, thus achieving alignment with human values. First, a
reward model is trained to fit human preferences based on human comparative ratings
of the results generated by the model. Then, using the reinforcement learning
framework, the model parameters are set as strategies, and the PPO (Proximal Policy
Optimization) algorithm is used to conduct multiple iterations to optimize the model
parameters and enhance the safety compliance of the model.
Š Professional Capability Enhancement: On the basis of the general-purpose large language
model, when faced with professional problems of specific industries, we also introduce plug-in
extension, industry enhancement and customization to effectively integrate real-time
information, industry knowledge and enterprise data, reducing the shortcomings of the large
language model in terms of timeliness, accuracy and professionalism and enhancing the
capability of the UniBrain to solve professional problems.
O Plug-in Extension : The large language model is not omnipotent by itself. It lacks
real-time information capture capability, certain professional tools and third-party
services, such as the ability to conduct complex calculations, order food delivery and
complete payment for online shopping. We provide plug-in extension framework and
developed several built-in plug-ins, such as calculators, weather queries,
neighborhood queries and web search plug-ins. The plug-in extension capability
allows the large language model to access real-time information, supporting the
model to act as a brain hub to access external tools and achieve planning,
collaboration and completion of specific tasks. It can also access knowledge-based
plug-ins to reduce model hallucination.
O Industry Enhancement : When applying the large language model to a specific
industry, we would conduct domain enhancement to optimize its intra-domain
performance. We have a set of methodology for domain enhancement, including (i)
increasing the training of domain-specific high-quality text data in the pre-training
phase; (ii) increasing the fine-tuning data corresponding to industry-specific tasks in
the fine-tuning phase; and (iii) using the plug-in extension framework to make
available multiple knowledge-based plug-ins based on the industry knowledge graph
and embedding them into the large language model, which can greatly reduce
209


--- page 219 ---
BUSINESS
incorrect responses generated by the large language model and significantly improve
the information quality and professional capabilities of the large language model.
Based on this methodology, we are in the process of training industry-specific large
language models for the medical, financial and legal industries.
O Customization: We can provide multi-level large language model customization
services for customers, including (i) accessing customer’s network to build an
enterprise-level conversational search engine; (ii) using the plug-in extension to
encapsulate customer’s internal private data and services as plug-ins, permitting the
large language model to integrate the internal data and service APIs of the customers;
(iii) using the task-oriented annotation data accumulated by the customer to provide a
fine-tuning API for the large language model, making it possible for the customer to
conduct customized fine-tuning of the large language model, thereby improving its
efficiency; and (iv) based on the large language model construction and management
platform, we provide customers with one-stop services from data selection, model
training to model deployment, operation and maintenance, making all the large
language model capabilities available to the customers.
Technology Application
Daily Life: Interaction systems using traditional technologies often struggle to understand
natural language expressions of users. For a well-calibrated system, even minor changes in user
expression or the need to use contextual relations could easily lead to system failures. Large language
models have remarkable advantages in understanding and generating natural languages. They enable a
human-machine voice interaction system to more easily cope with varied user expressions and produce
more human-like responses, giving users the feeling that the machine truly understands their needs.
Healthcare: Take medical record generation as an example: Traditional technologies have
limited abilities in summarization and generation of natural language content. For summarization,
traditional technologies follow a fixed, preprogrammed workflow, requiring the machine to understand
the original content step by step, extract the key points and then assemble a rigid and mechanical
summary. Any changes or irregularities in the natural language content may also cause failures.
However, large language models adopt a more human-like and flexible process instead of an explicit
and rigid process. Guided by reasonable prompts, large language models can automatically generate
summaries. The summaries so generated better cater to the user needs, have clear viewpoints and are
fluently written. The quality and utility are significantly superior to traditional technologies.
Industry-scale Knowledge Graphs
Industry knowledge graph is a core component for cognitive intelligence, which when
combined with UniGPT can effectively improve the accuracy and reliability of industry knowledge and
solve industry problems. We established our industry-scale knowledge graph management platform to
support the whole life cycle management of knowledge graphs, including construction, fusion, storage,
service and interaction. We have built our industry-scale knowledge graphs through extracting key
industry concepts and technical terms from large volume of unstructured data we process, such as in
the form of voice and speech, into industry-specific knowledge and insights through three steps:
Š Standardizing: Through repeated extraction of similar and high-frequency industry
concepts and technical terms, our knowledge graphs achieve automatic categorization and
210


--- page 220 ---
BUSINESS
identification of standardized concepts with autocorrect for misreading and typos. Once
established and recorded in the knowledge graphs, standardized industry terms can be used
to identify specific hit words with the same or similar meanings in the speech and texts in
different scenarios with different dialects and handwritings. The more services we provide
to a specific industry, the more data we process and the more sensitive and accurate our
knowledge graphs become to identify the professional speech and thesis based on the
standardized concepts it established.
Š Layering: With the industry-scale database of standardized concepts, our knowledge
graphs further provide layered and tree-structured directory of concepts to further clarify
the different levels of concepts and sort out the relationships between terms within the
same group. For example, hepatitis and liver cancer are both under the higher-level liver
disease category, while hepatitis A and hepatocellular carcinoma are one level below
under each of the hepatitis and liver cancer category, respectively. With clear delineation
of the layered concepts and terms, our knowledge graphs establish structured encyclopedia
for specific industries and scenarios.
Š Associating: Built upon the accumulated achievements of standardizing and layering, our
knowledge graphs further support the key step of associating to utilize the professional term
database and encyclopedia. Connecting the different concepts under different knowledge
groups across different practice areas within the same industry, our knowledge graphs support
both understanding of long and difficult speech and thesis with mixed concepts and automatic
creation or summarization of structured speech or texts in response.
Technology Application
An industry knowledge graph, in essence, is a structured and tagged presentation of knowledge
within a specific industry. This structured and tagged knowledge is organized in certain form (graph),
creating a non-relational knowledge database. Through this process, complex unstructured industry
knowledge is transformed into a clear, structured format that can be processed by machines.
Daily Life: Common knowledge about people’s lives, various rules and systems of architectural
spaces can all be structuralized and graphed. When performing human-machine interaction or space IoT
management tasks, AI can refer to the content in the knowledge graph, allowing the system to provide
reasonable, effective and specific responses. For example, location information of subway stations can be
pre-stored in the knowledge graph. When a user inquires the location of the restroom, the system, after
understanding the inquiry, can retrieve the information from the knowledge graph and then use natural
language generation to produce text information and deliver such information to the user via voice response.
Healthcare: Traditional medical knowledge is stored in numerous articles and thesis in a
fragmented manner, forming a massive matrix of unstructured text. When humans handle medical
cases, they need to spend years studying in advance, absorbing knowledge and then retrieving relevant
knowledge to make diagnostic decisions when dealing with cases. The process for machine learning is
similar to that of human learning, but at a much greater scale and efficiency. Machines first
“understand” medical texts, structuralize and tag the knowledge, and store it in the medical knowledge
graph. During subsequent applications (such as medical record entry, medical record quality control or
diagnosis assistance), the machine retrieves relevant knowledge from the knowledge graph and
compares it with the current application case. Based on the knowledge content, it provides process
management and decision-making support.
211


--- page 221 ---
BUSINESS
Multi modal Perception and Generation
Our multimodal perception and generation cover the chain of communication that starts from
perception of external signals and ends with production of signals from response, facilitating the
AI-enabled communication methods supported by our conversational AI core technology. In addition
to our core conversational AI technologies, we have also developed multimodal capabilities such as
facial recognition, OCR (Optical Character Recognition) and Audio-Visual Synthesis (AVS).
Š Multimodal Perception
O Speech Signal Processing : Based on array and deep learning technology, our signal
processing technology provides high-performance human-machine voice interaction
and phone call noise reduction under different scenarios, covering a variety of far and
near-field array processing solutions with different number of microphones, and
achieves echo cancelation, sound direction finding, spatial filtering and reverberation
suppression. By separating the speech signal from various noise disturbances, it
improves the listening effect and speech recognition accuracy.
O Voice Wakeup and Command : Voice wakeup is the first step to initiate voice
interaction with AI devices. We use deep learning-based model and fast
customization scheme to optimize the model structure, using training data covering
different ages, gender, accents, speech rates, environmental noises and other complex
conditions to improve model accuracy and robustness. Using decision-making
algorithms for confidence measures, our voice wakeup technology has high activation
rate and low false alarm rate. With model compression, quantization and other
engineering optimization, the resource and power consumption were reduced
significantly, so that our voice wakeup engine can run on a variety of low-power
devices, greatly expanding the use of voice interaction.
O Speech and Speaker Recognition : As an important part of human-machine
interaction systems, speech and speaker recognition technology converts speech into
transcriptions with speaker identification. Based on end-to-end Transformer and
hybrid architecture and trained by large-scale speech and text corpus, our proprietary
speech recognition systems can achieve above 98% recognition accuracy under
normal conditions. When integrated with powerful SSP frontend and trained by
multi-condition and task-related data, the robustness of recognition under complex
conditions can be improved significantly. Meanwhile, with speaker diarization and
voiceprint verification technologies, we can identify and separate multiple speakers in
speech streams with high accuracy.
O Speech Analysis and Multimodal Capabilities Expansion : On top of our speech
processing and recognition technologies, we have developed speech analysis
technology for pronunciation assessment for spoken language learning scenarios. We
also developed facial recognition technology for multimodal personalized human-
computer interaction, as well as OCR technology for various printed documents
information processing, which are widely used in Healthcare solutions.
Š Multimodal Generation
O Text-to-Speech: Our text-to-speech technology transforms original input texts into
natural, high-quality and personalized voice sound waves. Based on deep learning
and end-to-end speech synthesis technology, our text-to-speech technology accurately
212


--- page 222 ---
BUSINESS
converts text into clear, natural and fluent speech in real time, with a MOS score of
4.2. We build the text-to-speech system in a quick and easy way which requires
minimal human involvement. Our personalized speech synthesis approach converts
and adjusts the existing source model using a small amount of speech dataset of the
target speaker, so that the adjusted source model contains the timbre of the target
speaker. We provide offline and online synthesis with multi-timbre optional, and an
option for customized personal timbre based on a library of 20-300 sentences.
O Multi-modal Audio-visual Synthesis: Our audio-visual synthesis technology develops
on top of our text-to-speech capabilities, creating avatars that facilitates intelligent
human-machine interactions covering natural language facial expressions, hand
gesture, pose and gaze. By offering customized avatars with different styles and
personalities, we enhance users’ interactive experiences and provide intelligent
assistance functions for video creation.
Technology Application
Daily Life: Consider a typical human-machine interaction case, such as a ticketing machine of
the Shenzhen Metro Line 20. The machine uses computer vision to perceive whether there is a user in
front. If a user is detected, the dialog function is activated; if not, the machine remains silent. Once
activated, the machine uses a microphone array to capture the user’s voice, analyze the content of the
speech, understand the user’s intent and provide response or perform the corresponding operation. This
is a typical process of multimodal perception. During the dialog with the user, the machine can perform
certain operations, display results or text on the screen or provide hints and feedback to the user via
voice. This is a demonstration of multimodal generation technology.
Healthcare: Voice electronic medical record entry is a typical voice input scenario. The
machine perceives the doctor’s voice through the microphone and extracts the effective information
from the voice to form text. This is the speech perception part of typical multimodal perception. In the
Healthcare scenario, AI outputs corresponding text to provide suggestions to doctors. Additionally, AI
analyzes the text content entered by doctors, such as the dialog between the doctor and the patient, the
original medical records, to create more concise and standard text content, i.e., medical summaries.
These are typical cases of voice and text multimodal generation.
One-stop IoT Interconnection System
We have established our unique one-stop IoT interconnection system where all the relevant
spaces, devices, users and services are interconnected for specific application scenarios to redefine the
organic interactions among people, events and objects.
Š Spaces: Spaces set up the stage where all the events take place and for people to interact
with different objects including IoT devices. Our IoT connection and support system is
capable of interconnection with all applicable IoT devices in different space settings, from
conference room, a whole hospital to the level of an entire industrial park. With our highly
compatible system accessing and connecting hundreds or thousands of IoT devices, we
blend our services seamlessly into the spaces to facilitate the natural human-machine
interaction on the basis of our AI capabilities with conversational AI as core.
Š Devices: IoT devices constantly generate valuable information in the form of huge
quantity of unstructured data which requires accurate and timely deciphering. Our IoT
213


--- page 223 ---
BUSINESS
connection and support system is compatible with all sorts of IoT devices, covering a
broad range across handy devices such as microphones, mobile phones and speakers to
large and complicated facilities including household electrical appliances, elevators and
medical devices.
Š Users: Our IoT connection and support system strives to provide seamless and intuitive
user experiences for all the persons interacting with IoT devices within the spaces where
our services are provided. With the goal of replacing manual labor to the extent possible,
we streamlined and simplified the procedures for instruction input to facilitate a care-free
interactive environment for the users. We export our conversational AI capabilities so that
voice commands, which is the most natural and intuitive instruction method of human
beings, can serve as the key instruction input for the relevant IoT devices to create
insurmountable user experiences.
Š Services: Combined with our AI capabilities and industry-scale knowledge graphs, our
IoT connection and support system serves as the backbone of our multi-dimensional
services. Through consolidated access to all the IoT devices for different application
scenarios, our IoT connection and support system collects the unstructured data from such
devices and provide them for processing through our AI engines with the support of our
industry-scale knowledge graphs tailored to the specific industries and application
scenarios.
Technology Application
This system is primarily used in Daily Life scenarios.
Consider home as an example: the endpoints of this system are various IoT devices, including
execution devices such as lights, air conditioners and fans, and sensors such as temperature meters,
action detectors and smoke detectors. The center of this system is the IoT system, and the endpoints
and center are inter-connected via the Internet, among others. The system also comprises various
terminals that interact with end users and various business systems that deal with operators, if any.
A typical use case is as follows: the user feels too cold and says to the interaction terminal via
voice that the temperature needs to be raised. The system understands the user’s intention and adjusts
the temperature. Meanwhile, the temperature sensors at various locations continuously transmit data to
the IoT center via the Internet. The AI center, according to the knowledge graph, determines that even
if the temperature is adjusted according to the user’s requirements, the temperature in some areas may
still be abnormal. Therefore, it automatically files an anomaly alert to the work order system. The work
order system then sends a work order to a specific maintenance personnel to check and resolve the
issue.
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. Compared to our
industry peers, our products and solution have a competitive edge primarily as they utilize our
advanced AI technologies, powered by our solid infrastructure and supported by our R&D and
customization and productization capabilities. Our advanced AI technologies are continuously iterated
while our AI models efficiently perform highly-automated self-reinforcement based on high-quality
214


--- page 224 ---
BUSINESS
and massive data from real world scenarios and continuous user feedback, unleashing a fly-wheel
effect. The performance of our deep learning algorithms and our technological strengths which set us
apart from our peers were recognized in prominent awards. See “– Our Strengths – Early entrant in
AGI Technologies.” As of December 31, 2024, our R&D team consisted of 322 employees,
representing approximately 69.4% of our total number of employees. We incurred RMB287.1 million,
RMB286.3 million and RMB370.1 million in R&D expenses in 2022, 2023 and 2024, respectively,
representing 47.8%, 39.4% and 39.4% of our total revenue during the same years.
Development
We plan to focus our research on below areas of technologies:
Atlas AI Infrastructure
Š Intelligent Computing Cluster : Continuously optimizing scheduling efficiency and
improving platform computing, storage and communication capabilities to provide
efficient support for elastic computational requirements;
Š Machine Learning Algorithms : Following the latest advancement in machine learning
algorithms to upgrade our main technologies after their successful testing and
implementation in large-scale industry applications; and
Š Data-centric Training Approach : Optimizing the computational framework for new
algorithms and processing tools for industry data, improving compatibility with more
machine learning algorithms and optimizing targeted main models efficiently.
Large Language Models (LLMs)
Following the frontier technology of multimodal LLM, as well as analysis, reasoning and
decision-making technologies, continuously improving the capability of LLM, reducing platform’s cost
on industry application, and improving industry knowledge and the efficiency of data scrolling.
Knowledge Graph
Diving into medical applications to solve more fundamental problems, backward chaining the
evolution of core building, analysis and decision-making technologies for knowledge graph to improve
the quality and efficiency of human-machine collaboration in solving professional problems.
Multi modal Perception and Generation
Š Multimodal Perception Technology : Continuously improving the modules’ performance
on aspects such as speed, accuracy, stability and cost-efficiency, improving the quality of
data generation and simulation, and training effects and efficiency through the advantages
of technologies, at the same time, expanding multilingual and multimodal perception
capabilities to provide richer and more effective perceptual information for understanding.
Š Multimodal Generation Technology : Improving the quality of speech and singing voice
synthesis, as well as audio-visual synthesis technologies, and achieving creativity level
requirements from accurate information conveyance to enrich expression capabilities such
as multimodal, emotional and personalized effects.
215


--- page 225 ---
BUSINESS
R&D Collaboration
Our core technologies for industrial application are primarily developed by our in-house research
and development team. As a supplement to our in-house research, we collaborate with academic institutions
on research and development, technology innovation, and attracting and developing AI talent to support our
rapid growth. We entered into a framework collaboration agreement with Institute of Automation of
Chinese Academy of Sciences (
ה“() CASIA”) in August 2020 (“ Framework
Agreement”), pursuant to which we agreed to collaborate on the following research: (i) knowledge map
construction in accordance with the medical needs as well as the key technology and tools required for the
knowledge map construction; (ii) quality control for medical records and proprietary medical system based
on medical NLP and knowledge mapping technology; and (iii) low-resource NLP and its role in vertical
markets. In our collaboration, we focus on the frontier research of AI and NLP technologies, typically
guided by a different central topic each year. Under this collaboration, we recruit graduate students to
conduct experimental researches on novel technologies which typically do not yet have clear
commercialization prospects. We may jointly publish academic papers and apply for technology projects.
Importantly, the collaboration serves as a means to identify, assess an cultivate young research talents.
Based on the advanced scientific research level of the State Key Laboratory for Pattern Recognition,
CASIA provides solid technology support for our R&D of intelligent interactive products, which enhance
our competitiveness and market leadership. Meanwhile, we aim to create a positive research atmosphere for
the collaboration to ensure that research objectives are practical, and in turn research results serve for
practical applications. Pursuant to the Framework Agreement, we are responsible for funding of the
collaborative projects, and bearing the relevant maintenance and operating cost of the joint laboratory. The
ownership of intellectual property arising from the collaboration shall be determined on a project-by-project
basis. CASIA mainly assists us in validating the effectiveness of new algorithms. During the Track Record
Period, our frontier R&D collaboration with CASIA has not yet directly contributed to the development of
core technologies of our existing products and solutions. Rather, the collaboration focuses on exploratory,
academic researches which strengthen our technology reserves and may better prepare us for future market
developments brought by emerging technologies or shifting research trends. As our collaboration did not
yield any readily marketable product, its contribution to our direct or indirect revenue was insignificant.
We established the Joint Laboratory for Natural Human-Computer Interaction with Shanghai
Normal University (“ Joint Laboratory ”), focusing on the improvement of our conversational AI
technology. We aim to create innovative platforms for the students to support and encourage creative
thinking and the sharing of new ideas, which will be conducive to attracting talents and injecting fresh
blood with vigor and high quality into our team. All patents arising from the collaboration shall be jointly
owned by Shanghai Normal University and us, while the university is entitled to utilize such patents for
free.
DATA SECURITY AND PRIVACY
As advised by our PRC legal advisor as to data security law, we are subject to the laws and
regulations relating to cybersecurity and data security protection, data privacy, and algorithm
compliance as our products and solutions as well as UniGPT involve AI technologies and algorithms.
We mainly process data related to customers and end users. See “Regulatory Overview — Regulations
on Cyber Security and Data Protection” and “Regulatory Overview — Regulations and Policies on
Artificial Intelligence Technologies.” We are committed to complying with these laws and regulations
and have taken the following measures to comply with the applicable laws and regulations.
Š Data Privacy : We process personal information of individual developers, the
administrators and enterprises users of customers that use our Daily Life products and
216


--- page 226 ---
BUSINESS
solutions, and trial users of UniGPT. We set out privacy protection policies with our
customers, and we require our customers to adhere to the privacy protection policies, and
to implement the privacy protection policies at the product application level with the end
users. In addition, if the products or solutions we deliver to customers include an
interactive interface for end users, we ensure that the privacy policy is directly displayed
on the interface to the end users. Our customers are responsible for ensuring compliance
with privacy information collection notices and processes for end users, as stipulated in
the privacy and confidentiality clauses of the agreements signed with us.
O For Daily Life products and solutions, we collect limited personal information from
individual developers and enterprise developer administrators in certain business
lines, such as AI capability API business and AI technology service platform business
and solutions. Such personal information includes names, contact details, and other
information necessary for the purpose of account registration and login, project
process management tools, and other related services. In the course of provision of
our services, such as hardware support, speech synthesis trials, and UniGPT trials, we
collect end users’ equipment ID and their uploaded content and inputs, such as text,
voice and images, which have been desensitized and cannot identify the identity of
the relevant users. These personal information and non-personal data have not been
categorized as state secrets, core data, or important data by the applicable PRC laws
and regulations. The end users’ data are collected after obtaining their
acknowledgement and consent to the terms and conditions of our data privacy policy.
The data privacy policy states our data practices in information collection and usage,
and that we do not use any data for any purpose other than those specified in the data
privacy policy with our users. Our Healthcare products and solutions are delivered as
standalone software through private deployments. We do not collect any personal
information from our customers and their end users and such information is processed
entirely by our customers.
O We engage third parties, if necessary, to analyze and annotate desensitized data. We
also engage third parties to ensure data safety under service contracts, and conduct
examination of their data processing from time to time. We leverage training data for
ongoing model training, which excludes users’ personal information, and therefore
such data is not directly subject to the Group’s data privacy policies. We have entered
into contracts with training data providers pursuant to which we obtain confirmation
from such training data providers that they have acquired data from legitimate source
and that they have obtained the authorizations and rights to use such data for the
purpose specified in the agreements. These contracts ensure that data resources used
for training our AI models are legally authorized and comply with all applicable laws
and regulations. In addition, we store user data for a certain period in accordance with
PRC laws and regulations and our internal data storage guidelines, which specify our
principles and procedures for data storage and destruction. We anonymize and
desensitize the data of canceled users and users who have ceased services. We also
establish and implement sound internal rules and procedures and adopt robust
technical measures to safeguard the security of personal information.
O During the Track Record Period and up to the Latest Practicable Date, there had been
no investigation, penalty, litigation or other legal proceedings against the Group
arising from or in relation to any violation of data privacy laws and regulations that
217


--- page 227 ---
BUSINESS
would materially and adversely affect the Group’s business. The legal advisor as to
PRC data security law engaged by the Group have reviewed the policies and
procedures related to data privacy adopted by the Group and are of the view that
during the Track Record Period and up to the Latest Practicable Date, the Company
has complied in all material aspects with relevant data privacy laws and regulations.
Š Cybersecurity and Data Security Protection : We use a variety of technologies to protect
the data we collect, such as encryption, firewall, vulnerability scanning and log audit. For
instance, we have a team of professionals who are dedicated to the ongoing review and
monitoring of data security practices. We maintain data access logs that record all
attempted and successful access to our data and conduct automated monitoring and routine
manual verification of large data requests. We have implemented relevant internal
procedures and controls to ensure the security of our IT infrastructure, that our data is
protected and that leakage and loss of such data is avoided. During the Track Record
Period and up to the Latest Practicable Date, we did not experience any material system
failure in our IT infrastructure, or any material leakage or loss of data.
Š Algorithm Compliance : We adopt a series of measures to comply with PRC laws and
regulations related to algorithm and AI related:
O We have conducted manually review and machine review on the input data and
timely disposing any illegal or harmful information in these data and results. For the
reviewing process, all input and output information must undergo full-scale machine
review (such as automatic screening of sensitive lexicon). All data failing the
machine review automatically enters a manual review process. The data that passes
the machine review undergoes additional random manual checks. Output generation
stops for any data that fails either machine or manual review. To further ensure the
thorough and effective manual review and disposal of harmful information while
maintaining normal customer service, we have engaged a qualified and experienced
third party to provide personnel and technical support and cooperate with our staff to
support round-the-clock manual review. The review personnel review responses
according to the process, record review results and provide feedback. Furthermore,
we continuously update and improve review standards and database of harmful
information based on the latest review situation to ensure that the review standards
comply with relevant laws, regulations, and ethical standards, while not arbitrarily
refusing to respond to non-sensitive topics. We also conduct regular manual
inspections and supervision of the review status and provide channels for complaints,
feedback, and debunk, promptly address any interception errors or false, harmful
information in output results reported by users to enhance review accuracy and
service experience.
O We have established and implemented internal rules and procedures with respect to
algorithm security assessment and management. We require our developers and
customers to comply applicable laws and regulations and will warn developers and
customers, limit or suspend their usage, or cancel their accounts if we spot any illegal
usage of our service by them.
O We appointed an algorithm security officer to serve as the head of the Group’s
algorithm security management team to coordinate algorithm governance work. The
algorithm security management team is formed jointly by key personnel from the
218


--- page 228 ---
BUSINESS
Group’s security department, product management, legal affairs, and government
affairs liaison. Led by the algorithm security officer, the management team is
responsible for developing comprehensive management systems for our algorithm
services, implementing risk prevention and control measures, actively identifying and
addressing potential security vulnerabilities, enhancing our ability to respond
effectively to algorithm security emergencies, and conducting regular reviews,
evaluations and verifications of algorithm mechanisms, models, data, generated
content, and application outcomes.
O We have completed the algorithm filing for our algorithms used in our products and
solutions with the CAC and the security assessment for our products and solutions
related to UniGPT in accordance with the Measures on Generative AI Services. In
accordance with the Measures on Generative AI Services, such filing and assessment
apply to generative AI services with public opinion attributes or social mobilization
ability. Although our services are not designed to possess these characteristics, we
have prudently completed these procedures. This decision was made out of caution,
given that the Measures on Generative AI Services are newly issued, it remains
uncertain as to whether our services would be regarded as capturing features related
to public opinion attribute or social mobilization ability, which will subject us to
complete the algorithm filing and security assessment in accordance with relevant
laws and regulations. Up to the Latest Practicable Date, we have not launched or
delivered any new products or solutions that require separate assessment or filing.
Based on the foregoing, as confirmed by our legal advisor as to PRC data security law, our
Directors are of the view that, during the Track Record Period and up to the Latest Practicable Date,
we had complied with the applicable laws and regulations in relation to data privacy, cybersecurity and
data security protection and algorithm compliance in all material respects. Our operations and financial
condition are not adversely impacted by these laws and regulations. Based on the independent due
diligence conducted by the Joint Sponsors and having considered the views and basis of our Directors
and our PRC legal advisor as to data security law as disclosed in this prospectus, nothing has come to
the attention of the Joint Sponsors that would reasonably cause the Joint Sponsors to cast doubt on the
reasonableness of the views of our Directors and our PRC legal advisor as to data security law in any
material aspect.
INTELLECTUAL PROPERTY
We regard our proprietary domain names, copyrights, trademarks, trade secrets, and other
intellectual property, critical to our business operations. We rely on a combination of patents,
copyrights, trademarks, trade secret laws, and restrictions on disclosure to protect our intellectual
property. As of December 31, 2024, we had 512 patents and 294 software copyrights in China.
219


--- page 229 ---
BUSINESS
The table below sets forth our key IP rights and their respective technological significance to us
as of the Latest Practicable Date:
Patent Name Patent No.
Intended
Use(s)
Functions and
Significance
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
A human-machine
interaction system
for multi-device
autonomous
decision-making
CN201910323610.8 Daily Life,
including
residence
and
commercial
space
Core
foundational
technology
enabling
multi-device
collaborative
human-
machine
interaction
in Daily Life
solutions
02/03/2021 02/03/2041
A method and
system for
canceling
reverberation
CN201910810308.5 Daily Life,
including
residence,
intelligent
cockpit and
Healthcare
such as
voice-
based
electronic
medical
records
Foundational
technology
for far-field
voice pickup
in various
scenarios,
such as
intelligent
home and
intelligent
cockpit
17/12/2021 17/12/2041
A speech
processing
method and
device
CN201610264283.X Healthcare,
including
voice-
based
electronic
medical
record
Foundational
technology
for voice
input-related
products in
Healthcare
31/03/2020 31/03/2040
A speech
synthesis method
and system
CN201810517280.1 Voice
interaction
products
Foundational
technology
for voice
synthesis
functionality
across our
product
solutions
25/09/2020 25/09/2040
A speech intent
recognition
method, device
and readable
storage medium
CN202110616990.1 Voice
interaction
products
Foundational
technology
enabling
machines to
understand
the intent
or content of
user speech
in voice
interaction
products
28/02/2023 28/02/2043
220


--- page 230 ---
BUSINESS
Patent Name Patent No.
Intended
Use(s)
Functions and
Significance
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
A method and
device for
deploying
Heterogeneous
supercomputing
platform
CN202010317608.2 Foundational
intelligent
computing
components
Core
foundational
technology
for intelligent
computing
scheduling
platforms
used in neural
network or
large model
training
28/02/2023 28/02/2043
For details, see “Appendix VI – Statutory and General Information – Further Information about
our Business – Intellectual Property Rights.”
We implement a set of comprehensive measures to protect our intellectual property, in addition
to making trademark and patent registration applications. We have established an intellectual property
management department and designated staff to oversee and manage our intellectual properties. Our
employees are generally required to enter into a standard employment contract that includes a
confidentiality clause and a clause acknowledging that all inventions, trade secrets, developments and
other processes generated by them during their employment with us are our properties, and assigning to
us any ownership rights that they may claim in those works. We will actively monitor and pursue
claims against any unauthorized use of our intellectual property. In addition, to avoid claims for
intellectual property infringement from third parties, our internal control measures require that we
obtain necessary licenses or permissions from the right owners for our products and solutions
development, and explicitly stipulate the ownership of intellectual property in any R&D collaboration
agreements with external institutions.
As of the Latest Practicable Date, we had not been subject to any material dispute or claims for
infringement upon third parties’ trademarks, licenses and other intellectual property rights in China.
SALES AND MARKETING
Our Sales Network
We sell our products and solutions through our direct sales team.
As of December 31, 2024, our sales team consisted of 81 employees with extensive industry
experience and in-depth expertise of our AI-based products and solutions. Depending on different
features of our offerings, our sales cycles may vary. See “– Our Offerings – Daily Life – Solutions –
Key Features of Our Daily Life Solutions Offerings” for an example of our typical sales cycles. Our
sales team generally sets annual and quarterly sales plans for effective and systematic execution. Our
sales team holds an annual year-end meeting to determine the overall annual sales plan for the next
year, including sales tasks, assessment indicators and more detailed sales plans, taking into
consideration of the customers types, market conditions, latest changes in the industry and competitors.
We have implemented strict policies and internal procedures to regulate our sales team and their
conduct during the sales of our products and solutions, and ensure their compliance with relevant
regulations. For example, we prohibit the unauthorized quotation provided by our sales personnel
which is below the guided price.
221


--- page 231 ---
BUSINESS
Our customers include enterprise customers of our products and solutions, as well as system
integrators and agents engaged by certain of end users.
Some end users engage system integrators when selecting suppliers or service providers.
Usually the end user lays out the goals it plans to achieve and the budget for the project and
engages a system integrators who provide various types of assistance in project implementation,
such as advising on financing plans, selecting suppliers, managing construction and integrating the
work products of different suppliers. Such syste m integrators help end users build a one-stop
intelligent system which may comprise various modules and functional units from different
suppliers, including AI products and solutions. Sys tem integrators directly negotiate with suppliers
or service providers, but the end users typically approve the supplier selection, especially for core
suppliers such as AI service providers.
Some of our end users, in line with industry practice and their procurement policies, would
engage procurement agents for the detailed procurement plan and execution after selecting us as their
end supplier. We would then enter into contracts with such agents.
Under our contracts with system integrators or agents, the payments are made to us by the
system integrators or the agents, and therefore we recognized them as direct customers in accounting
treatments.
Importantly,
Š system integrators or agents are not distributors that we engage to broaden our sales
channels; rather, they are agents selected by our end users to implement their projects;
Š the end users, instead of the system integrators or agents, typically control the selection of
the supplier;
Š as stipulated under the contracts, the products and solutions are directly delivered to
certain specific end users instead of being resold by the system integrators or agents to
unspecified end users, and given that our products and solutions typically are tailored to
end users’ use cases, the system integrators or agents will not be able to repurpose the
products and solutions for other end users; and
Š regardless of whether our contracts were entered into directly with our enterprise
customers or with such system integrators or agents, there is no material disparity in
contract terms and the scope of our services.
Given the above, we believe that (i) the system integrators or agents do not have the typical
characteristics of distributors, as such term is defined under Chapter 4.5 of the Guide for New Listing
Applicants published by the Stock Exchange; (ii) our sales to system integrators or agents is not under
a distributorship model; (iii) their involvement as our direct customers does not raise any concern in
relation to channel stuffing; inventory risk, cannibalization or recoverability of accounts receivables.
Our internal control measures can ensure that all the services were purchased by the system
integrators and agents on behalf of the customers, as we typically (i) confirm with the customers the
information of the end users at the time of signing the contract, (ii) perform Proof of Concept (“ POC”)
testing at the end user’s site before the delivery and implementation as the projects require, (iii) keep
record of employees’ work travels and working hours, which can help verify information about the end
222


--- page 232 ---
BUSINESS
user. In addition, some contracts will also stipulate the name of the end user and the end user’s delivery
and implementation location. The following is an illustration of the operation and fund flows of sales
to system integrators and agents:
We enter into a
contract with the
integrator/agent
Delivery and
implementation Acceptance Maintenance End123
1. We enter into a contract with the system integrator/agent, from whom we receive a prepayment. We then proceed to the end user’s site to
carry out the implementation process.
2. During the implementation process, depending on the terms we agreed upon with the system integrator/agent, we may receive a progress
payment. After the implementation is finished, we go through the acceptance process with the system integrator/agent.
3. After acceptance, depending on the contract terms, we may receive the balance of the contract value from the integrator/agent. We then
continue to offer maintenance service for the solution we delivered. Alternatively, we may receive another portion of the contract value
and continue to offer maintenance service. After the maintenance period is over, we receive the balance of the contract value.
The following table sets forth our revenue by customer type during the Track Record Period.
Year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Enterprise customers .................................. 316,684 52.7 389,849 53.6 422,064 44.9
System integrators /Agents ............................ 283,935 47.3 337,467 46.4 516,953 55.1
Total ............................................. 600,619 100.0 727,316 100.0 939,017 100.0
Pricing
Our solutions are mainly priced based on functionalities and complexity of software solutions
provided, hardware procurement cost and deployment cost for manpower.
We have developed different pricing policies for our products and solutions. Specifically:
Š Daily Life: We generally provide customers with a menu-style quotation of our Daily Life
solutions and products. The quotation of each solution typically depends on, among others,
supply and demand, the marketing positioning, and the price of competitive solutions and
products. Customers can select suitable solutions and products in accordance with their
specific demands and budget. We combine the selected solutions and products and make
appropriate customized modification for our customers.
O Daily Life solutions, AI Chips and AI Modules : We typically determine the final price
based on the total unit price of the products selected by the customer and the level of
customization performed.
O AI Capability APIs : We charge subscription fees for such services on a pay-per-use
basis. During the Track Record Period, such subscription fees were insignificant to
our total revenue.
Š Healthcare: Our Healthcare solutions are typically delivered as customized one-stop AI-
empowered business systems, where a selection of our AI soft- and hardware are
integrated according to specific customer demands. We also provide standardized
efficiency tools, such as voice interaction solutions and service solutions, based on
conversational AI capabilities. We generally determine the price of our Healthcare
solutions considering various factors, including market positioning, market conditions,
type of customers, pricing of competitors, functionalities of the solutions, level of
223


--- page 233 ---
BUSINESS
customization and relevant policies, including the guidance and standards on specific
intelligence functionalities, as well as the level of support set forth in the policies. For our
lighthouse customers, we usually provide solutions with premium functions. To further
attract customers in the industry verticals or application scenarios we already penetrated,
we provide solutions with general functions to reduce the overall price of solutions. In
addition, we provide some lighthouse customers with customized services and charge for
additional customized service fees.
Marketing
We believe the most effective way of marketing is to continually enhance our capabilities to
address customer’s unmet demands and highlight the effectiveness of our solutions to enhance brand
recognition and promoting our products and solutions. We have established a sales and marketing
department responsible for developing the marketing plans, managing sales team, analyzing the
position of our products and solutions, training for sales team, maintaining existing customers and
developing new customers and pricing.
Our sales team take the responsibility of conducting in-depth communication with our potential
customers and demonstrate the professionalism of our products and solutions through showcasing
outstanding cases, so as to enable our potential customers to fully comprehend and recognize our
capabilities. We also attach great importance to maintaining existing customer relationships, and
through the recognition from existing customers, we conduct low-cost promotion in the industry our
customers involved in, thereby continuously replicating success in similar application scenarios and
achieving wider sales.
CUSTOMERS
We have a large customer base and we do not rely on any single customer. In 2022, 2023 and
2024, revenue from our largest customer in each year during the Track Record Period accounted for
13.1%, 9.3% and 7.0%, respectively, of our total revenues during those years. In 2022, 2023 and 2024,
revenue from our five largest customers in each year during the Track Record Period accounted for
30.8%, 27.4% and 26.7%, respectively, of our total revenues during the same years.
The salient terms of our agreements with customers are set out below:
Š Deliverables: Based on the customer’s specifications, we primarily develop and deliver
customized AI-empowered Daily Life technology products and solutions.
Š Delivery Time: Depending on the complexity of the projects, we typically complete the
initial delivery of our AI solutions within a time period ranging from several weeks to half
a year. Most of the orders for our AI chips are one-off purchases and are typically fulfilled
in one month, while our AI modules are typically delivered in one month to 45 days.
Š Customer Support: We typically provide free technical support for one year to three years
after the delivery of the project. We also provide free training to the technical staff of our
customers.
Š Technical Services: After the expiration of the free technical support period (if
applicable), we may agree to provide continued maintenance service and technical support
to our customers and charge an annual fee on an ongoing basis. This service is typically
under a standalone technical service agreement. In the event of substantial upgrade to such
products and solutions in terms of infrastructure, platforms or functions, we typically enter
into new agreements with our customers.
224


--- page 234 ---
BUSINESS
Š Pricing: We typically charge our customers on a project basis, the pricing of which is
primarily based on the complexity, capacity and functionality of the products and solutions
provided.
Š Settlement: Depends on the types of offerings, our settlement methods with customers
may vary. Payments for our Daily Life products are typically required upon delivery.
Payments for Daily Life solutions and Healthcare solutions are required upon completion
of final inspection, and we may require prepayments or agree with certain quality
assurance deposit. For our AI capability APIs, we charge subscription fees on a pay-per-
use basis. See “– Our Offerings.”
Š IP Rights: Typically, all IP rights initially owned by us belong to us, while those
developed due to the customization belong to customers. Any proprietary information and
IP rights of the customers that are used in the projects remain customers’ property.
Š Termination: Typically, either party has the right to terminate the agreements in the event
of the opposing party’s insolvency, material violation of laws and regulations or material
breach of contracts.
The following tables set forth details about our five largest customers during the Track Record Period:
Year ended December 31, 2022
Customer
Products
and
Services
Sold
Principal
Business
Customer Background and
Scale of Operations Location
Year of
Commencing
Business
Relationship
Sales
Amount
%o f
Total
Revenue
Settlement
Method
RMB’000
Shimao Group
Holdings
Limited .....
Daily Life Enterprise
customer
An international and
comprehensive investment group
primarily engaging in property
development, commercial
property operation, property
management and hotel
operations. It has established a
presence in over 100 cities in the
PRC.
China 2019 78,518 13.1% Bank
transfer
Customer A
(1) . . Daily Life System
integrator/
agent
A provider of comprehensive
urban rail solutions primarily
engaging in general construction,
system development and
integration services and urban rail
transit equipment manufacturing.
Its business has extended to over
twenty provinces and
municipalities and over fifty
cities in the PRC, and also to
overseas customers.
China 2022 51,701 8.6% Bank
transfer
225


--- page 235 ---
BUSINESS
Year ended December 31, 2022
Customer
Products
and
Services
Sold
Principal
Business
Customer Background and
Scale of Operations Location
Year of
Commencing
Business
Relationship
Sales
Amount
%o f
Total
Revenue
Settlement
Method
RMB’000
Shenzhen
Nengzhi
Industrial
Information
Technology
Co., Ltd. ....
Daily Life Enterprise
customer
and
system
integrator/
agent
(2)
An industrial information
technology company that
integrates software and
hardware research and
development and sales. It
provides products and solutions
including electronic instruments
and office equipment in the
fields such as rail transit, parks
and classrooms.
China 2020 20,936 3.5% Bank
transfer
Xiamen
Chuangxige
Technology
Co., Ltd. ....
Daily Life Enterprise
customer
and
system
integrator/
agent
(3)
A technology company
primarily engaging in
buildings, communities,
transportation and information
security. Its services and
offerings primarily include
software development,
information system integration
services, information
technology consulting services,
integrated circuit design,
electrical equipment wholesale
and other mechanical
equipment and electronic
products wholesale.
China 2021 16,960 2.8% Bank
transfer
Customer L
(1) . . Daily Life Enterprise
customer
and
system
integrator/
agent
(4)
A large-scale state-owned
high-tech information company
. It primarily engages in
providing information
technology services and
software development in areas
including transportation
information, e-government,
electronic payment and
information technology
outsourcing.
China 2021 16,955 2.8% Bank
transfer
Total 185,070 30.8%
Notes:
(1) This customer did not consent to the disclosure of its name in this prospectus.
(2) In some cases, it was engaged by certain end users, who are primarily public sector rail system development companies, to purchase our
products for them as system integrator/agent.
(3) In some cases, this customer was engaged by certain end users, who are primarily public sector municipal offices, communities, schools
and hospitals, to purchase our products for them as system integrator/agent.
(4) In some cases, this customer was engaged by certain end users, who are primarily industrial parks, to purchase our products for them as
system integrator/agent. 226


--- page 236 ---
BUSINESS
Year ended December 31, 2023
Customer
Products
and
Services
Sold
Principal
Business
Customer Background and
Scale of Operations Location
Year of
Commencing
Business
Relationship
Sales
Amount
%o f
Total
Revenue
Settlement
Method
RMB’000
Customer M(1) . . Daily Life Enterprise
customer
and
system
integrator/
agent
(2)
A large-scale information
technology enterprise with
business spanning across
industries including cloud
computing, big data and
industrial internet. It
provides IT products and
technology services to
over 120 countries and
regions worldwide.
China 2021 67,446 9.3% Bank
transfer
Customer E
(3) . . . Healthcare System
integrator/
agent
A medical device technology
company engaged in the
healthcare sector, focusing on
the sale of medical equipment,
the system integration in the
application of AI technologies
and the provision of technical
services.
China 2023 45,023 6.2% Bank
transfer
Customer O
(4) . . Daily Life Enterprise
customer
A high-tech enterprise that
specializes in providing
intelligent voice interaction
and acoustic enhancement
solutions to a diverse range of
industries, including robotics,
financial equipment,
communication devices, home
products and household
appliances. It has been
dedicated to the development
of voice interaction chips and
related solutions.
China 2022 35,332 4.9% Bank
transfer
Shenzhen
Nengzhi
Industrial
Information
Technology
Co., Ltd. .....
Daily Life System
integrator/
agent
An industrial information
technology company that
integrates software and
hardware research and
development and sales. It
provides products and
solutions including
electronic instruments and
office equipment in the
fields such as rail transit,
parks and
classrooms.
China 2020 26,908 3.7% Bank
transfer
227


--- page 237 ---
BUSINESS
Year ended December 31, 2023
Customer
Products
and
Services
Sold
Principal
Business
Customer Background and
Scale of Operations Location
Year of
Commencing
Business
Relationship
Sales
Amount
%o f
Total
Revenue
Settlement
Method
RMB’000
Shimao Group
Holdings
Limited .....
Daily
Life
Enterprise
customer
and
system
integrator/
agent
(5)
An international and
comprehensive investment
group primarily engaging
in property development,
commercial property
operation, property
management and hotel
operations. It has
established a presence in
over 100 cities in the PRC.
China 2019 24,288 3.3% Bank
transfer
Total 198,997 27.4%
Notes:
(1) This customer did not consent to the disclosure of its name in this prospectus.
(2) In some cases, this customer was engaged by certain end users, who are primarily public sector residential and commercial office parks,
to purchase our products for them as system integrator/agent.
(3) This customer did not consent to the disclosure of its name in this prospectus. This customer has become our second largest customer in
2023, primarily because it has been experiencing a consistent increase in collaborative projects with major hospitals, and required our
service in its collaboration with hospital customers.
(4) This customer did not consent to the disclosure of its name in this prospectus. This customer has become our third largest customer in
2023, primarily because it has become our strategic partner under Daily Life, as the customer is dedicated to the development of voice
interaction chips and solutions, and has delegated a research and development team to work with us in our provision of Daily Life
products and solutions.
(5) In some cases, this customer was engaged by certain end users, who are primarily public sector commercial office parks, to purchase our
products for them as system integrator/agent.
Year ended December 31, 2024
Customer
Products
and
Services
Sold
Principal
Business
Customer Background and
Scale of Operations Location
Year of
Commencing
Business
Relationship
Sales
Amount
%o f
Total
Revenue
Settlement
Method
RMB’000
Customer M(1) . . Daily Life Enterprise
customer
and system
integrator/
agent
(2)
A large-scale information
technology enterprise with
business spanning across
industries including cloud
computing, big data and
industrial internet. It provides
IT products and technology
services to over 120 countries
and regions worldwide.
China 2021 65,981 7.0% Bank
Transfer
Customer P
(1) . . . Healthcare Enterprise
customer
A technology company
primarily engaging in
providing enterprise-level AI
solutions and developing AI
platforms.
China 2024 52,252 5.6% Bank
Transfer
228


--- page 238 ---
BUSINESS
Year ended December 31, 2024
Customer
Products
and
Services
Sold
Principal
Business
Customer Background and
Scale of Operations Location
Year of
Commencing
Business
Relationship
Sales
Amount
%o f
Total
Revenue
Settlement
Method
RMB’000
Shenzhen
Tongchen
Technology
Co., Ltd. .....
Daily Life Enterprise
customer
and system
integrator/
agent
(3)
A technology company
primarily focusing on the
development and sales of
communication equipment,
network systems, and
industrial automation
systems.
China 2022 46,072 4.9% Bank
Transfer
Customer R
(1) . . . Daily Life Enterprise
customer
and system
integrator/
agent
(4)
A technology company
primarily focusing on
technology services, internet
security, and software
development.
China 2021 43,560 4.6% Bank
Transfer
Customer S
(1) . . . Daily Life Enterprise
customer
and system
integrator/
agent
(5)
A software company
primarily engaging in
software development, digital
transformation consulting,
and system integration.
China 2024 43,190 4.6% Bank
Transfer
Total ......... 251,055 26.7%
Notes:
(1) This customer did not consent to the disclosure of its name in this prospectus.
(2) In some cases, this customer was engaged by certain end users, who are primarily public sector residential and commercial office parks,
to purchase our products for them as system integrator/agent.
(3) In some cases, this customer was engaged by certain end users, who are primarily public sector rail system development companies and
commercial office parks, to purchase our products for them as system integrator/agent.
(4) In some cases, this customer was engaged by certain end users, who are primarily public sector rail system development companies and
commercial office parks, to purchase our products for them as system integrator/agent.
(5) In some cases, this customer was engaged by certain end users, who are primarily public sector municipal offices and state-owned
enterprises, to purchase our products for them as system integrator/agent.
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 customers in each year of the Track Record
Period.
Collaboration with Shimao Group
We had extensive collaboration with Shimao Group Holdings Limited (“ Shimao Group ”)
during the Track Record Period. We provide Shimao Group with our Daily Life solutions, including
residential and hospitality solutions. The residential solutions provided to Shimao Group include
advanced security features like locks and access control systems at entrances, as well as speakers or
interactive screens within homes. These devices integrate with home systems such as lighting, heating,
ventilation and air-conditioning, and safety sensors, and can be controlled via voice commands through
the support of UniBrain and a proprietary AI engine. Additionally, a mobile app allows for remote
home management. The system’s sophisticated voice recognition can interpret commands to adjust the
home environment, providing a seamless and intuitive living experience. Similarly, we provide Shimao
Group with hospitality solutions that include facial recognition for secure and efficient check-in,
intelligent guidance and elevator systems for guest convenience, and in-room intelligent speakers for
229


--- page 239 ---
BUSINESS
voice-controlled environment management. These systems enhance the guest experience, streamline
hotel operations and improve energy management. Our Directors confirm that all of our sales to
Shimao Group were conducted in the ordinary course of business under normal commercial terms and
on arm’s length basis.
As of December 31, 2024, the total contract sum of all the ongoing projects with Shimao Group
amounted to RMB293.3 million, which included (i) contracted but not yet commenced projects,
(ii) projects that were in execution but had not yet been accepted, and (iii) projects that had been
accepted but were still under the service-type warranties or cloud services.
Š As of December 31, 2024, the total revenue recognized from these projects amounted to
RMB219.9 million, and as of the same date, the total backlog contract value of these
projects amounted to RMB44.2 million.
Š As of December 31, 2024, we had 108 projects that had been accepted but were still under
the service-type warranties or cloud services with Shimao Group , the total contract sum of
which amounted to RMB252.3 million, and, as of December 31, 2024, the trade
receivables of such projects was RMB22.5 million.
Š As of December 31, 2024, we had outstanding trade receivables of RMB28.7 million, of
which we made provision of RMB26.3 million, and net contract assets of RMB0.1 million,
with Shimao Group. See “Financial Information – Discussion of Certain Key Balance
Sheet Items – Current Assets and Liabilities – Trade Receivables.”
In January 2025, a winding-up petition was filed against Shimao Group by CPYM Link
Investment Limited in connection with a guarantee provided by Shimao Group for a cross border loan
relating to CMB International Finance Limited, which was subsequently ordered to be withdrawn by the
Hong Kong High Court on February 25, 2025. We believe that there will be no material adverse impact
on our financial and business performance caused by such liquidation petition, given that (i) we monitor
the recoverability of the trade receivables due from Shimao Group and have continuously made
collection before and after the petition, (ii) we have regularly conducted risk assessment, and cautiously
initiate projects with such customer taking into consideration of the relevant entity’s financial condition
and recoverability on a project-by-project basis, (iii) since the winding-up petition have been ordered to
be withdrawn, we do not believe it will have any impact on our business with Shimao Group. Shimao
Group also announced a restructuring plan for its offshore debts, which has been sanctioned by the High
Court of Hong Kong on March 13, 2025. Based on publicly available information and our current
knowledge, we were not involved in Shimao Group’s offshore debt restructuring plan. As of the Latest
Practicable Date, Shimao Group continues normal operations to our knowledge and our projects with
Shimao Group and trade receivables collection are progressing normally.
We closely monitor the recoverability of the trade receivables due from Shimao Group and will
continue to make collection.
230


--- page 240 ---
BUSINESS
The following table sets forth an aging analysis of the outstanding trade receivables with
Shimao Group:
Balances as of
December 31, 2024
Subsequent
settlement as of
April 30, 2025
Subsequent
settlement
percentage
Provision
amount
Expected
credit
loss rate
(RMB in thousands, except for percentages)
Trade receivables ...................... 28,663 1,279 4.5% 26,278 91.7%
—Within one year .................. 2,831 690 24.4% 446 15.8%
—One year to two years ............. 2,871 — — 2,871 100.0%
—Over two years .................. 22,961 589 2.6% 22,961 100.0%
In addition, as of December 31, 2024, we had contract assets of approximately RMB124.0
thousand with Shimao Group. We provided a provision of RMB16.8 thousand, or 0.3% of the contract
assets as of December 31, 2024.
During the Track Record Period, we had entered into a number of contracts with Shimao Group
and expect to complete certain projects within 2025, for which we are not aware of material difficulties
in recovery of the relevant contract assets and trade receivables. We do not plan to secure new projects
from Shimao Group currently, and may consider individual projects depending on the relevant risk
profiles on a case-by-case basis.
In addition, certain projects for Daily Life solutions are planned to be implemented on
properties that are being constructed, for which contracts were signed in a relatively early stage. They
have not yet been implemented, and no costs have been incurred, due to the delays in the associated
civil/commercial property construction. We maintain close communication with Shimao Group
regarding the progress of such construction projects, and expect to initiate the AI solution projects in
due course.
We have not recognized any revenue for a few contracts with Shimao Group that had
commenced for more than a year, totaling RMB6.7 million as of April 30, 2025, due to the overall
schedule adjustment of the construction projects, which in turn affected our implementation of AI
solutions. These contracts are currently in the process of implementation and are expected to be
delivered and accepted by 2025. As of April 30, 2025, we recorded inventory – contract fulfillment
costs amounting to RMB3.9 million for costs incurred and had received partial advance payments of
RMB1.3 million. We did not make impairment for such costs, as we are not aware of material
difficulties in executing these projects and recovery of the relevant contract assets and trade
receivables, especially given the two main projects where our actual investment exceeds the amount of
payment received are under the government supervision, and future payments to us for these projects
will be processed through regulated accounts.
SUPPLIERS
Our suppliers include reputable hardware component, software, R&D and marketing service
providers. During the Track Record Period, substantially all of our suppliers were from China.
To ensure the quality of our products, we strictly select suppliers to source and prioritize
materials that meet industry standards. The factors that we take into account for the selection including
technological expertise, product quality, qualifications and credentials, market reputation and cost
competitiveness. We also conduct random sample checks upon receipt of the components using our
231


--- page 241 ---
BUSINESS
designed voice module. We also conduct annual review process of existing suppliers and update their
detailed information accordingly. Typically, we enter into one-off procurement agreements or
framework procurement agreements with our suppliers. Under framework procurement agreements,
individual purchase orders are separately placed for each purchase. In general, our procurements are
made at fixed unit prices prescribed in quotation provided and our chip suppliers require us to make
full prepayment of the agreement price. Our suppliers are usually responsible for arranging delivery to
us at their own costs. We are typically granted a warranty period ranging from one year to three years
by our suppliers, and we are entitled to return or exchange defective supplies.
The salient terms of our agreements with suppliers are set out below:
Š Delivery Time: Depending on the procured items and the specific needs of our projects,
we typically require our suppliers to deliver within a prescribed time period ranging from
several days to 1.5 months. Certain suppliers have long term framework contract with us,
under which they make prompt delivery according to our orders.
Š Maintenance Services: Our suppliers typically provide free maintenance service for up to
three years after the delivery of their products and services.
Š Settlement: We typically settle the payments in installments in accordance with the
performance progress of the agreements.
Š IP Rights: Any proprietary information and IP rights initially owned by us or developed
during the performance of the agreements belong to us.
Š Termination: Typically, either party has the right to terminate the agreements in the event
of the opposing party’s material violation of laws and regulations or material breach of
contracts.
We source significant quantity of advanced semiconductors from third party suppliers for our
AI products, especially our AI chips.
We observed that certain trade restrictions and geopolitical tensions in the recent years had
limited impact on our business operation as our business operations are not subject to US trade
restrictions and we did not experience any material supply shortage or suspension due to trade
restrictions. The semiconductor models that we procured were not specifically subject to trade
restrictions or licensing requirements. Going forward, we plan to further diversify our supplier base,
and we do not foresee any significant challenges in sourcing semiconductors used in our AI products.
Our Major Suppliers
Our major suppliers are suppliers of technology development services and hardware. While we
develop our AI infrastructure, core algorithms and frameworks internally, we engage external
technology development services for ancillary functions in crafting our AI applications. Our in-house
team independently create the pivotal components of AI applications, such as knowledge graphs, voice
interaction systems and other essential functional modules. Nevertheless, for the development of non-
core modules that are highly generic and easily substitutable, we opt for outsourcing to reduce research
and development expenses. Such technology development services we employ usually include the
creation of management platforms, which have management functions such as account management,
business data handling and information management, and system interfaces, the development and
testing of user interface presentations for mobile applications and websites, and investigative
232


--- page 242 ---
BUSINESS
development projects that pursue unique opportunities or explore new strategic directions beyond our
primary technological focus. Charges from our largest supplier in 2022, 2023 and 2024 accounted for
20.8%, 18.0% and 12.6%, respectively, of our total purchase during those years. Charges from our five
largest suppliers in 2022, 2023 and 2024 accounted for 46.2%, 43.4% and 44.2%, respectively, of our
total purchase during the same years.
The following tables set forth details about our five largest suppliers during the Track Record
Period:
Year ended December 31, 2022
Supplier
Products and Services
Purchased Supplier Background Location
Year of
Commencing
Business
Relationship
Purchase
Amount
%o f
Total
Purchase
Settlement
Method
RMB’000
Shenzhen
Zhiyuanlian
Technology
Co., Ltd. . . .
Technology
development services
and screen terminal
hardware
Engaged in technical
development of
computer software and
hardware, artificial
intelligence technology
services, research and
development and sales
of rail transit vehicle
and ground products
China 2020 106,991 20.8% Bank
transfer
Supplier C(1) . . Technology
development services,
hardware exhibition
hall
Engaged in the
development of
artificial intelligence
basic software and the
construction of public
data platforms, as well
as engineering
technology and design
services
China 2019 49,655 9.7% Bank
transfer
Cotell
Intelligent
Technology
(Shenzhen)
Co., Ltd. . . .
Technology
development services,
software and hardware
system expansion and
integration
Engaged in the
development and sales
of software and
hardware for office
equipment, intelligent
control products, and
audio and video
information terminal
products
China 2019 28,553 5.6% Bank
transfer
Shanghai
Yanshu
Computer
Technology
Co., Ltd. . . .
Technology
development services,
intelligence voice
development
Engaged in
information technology
and technical services
China 2021 27,246 5.3% Bank
transfer
Supplier E . . . Hardware Engaged in research
and development,
design, and sales of
integrated circuits and
related products
China 2019 24,497 4.8% Bank
transfer
Total 236,942 46.2%
Note:
(1) This supplier did not consent to the disclosure of its name in this prospectus.
233


--- page 243 ---
BUSINESS
Year ended December 31, 2023
Supplier
Products and Services
Purchased Supplier Background Location
Year of
Commencing
Business
Relationship
Purchase
Amount
%o f
Total
Purchase
Settlement
Method
RMB’000
Shenzhen
Zhiyuanlian
Technology
Co., Ltd. . . .
Technology
development services
and screen terminal
hardware
Engaged in technical
development of
computer software and
hardware, artificial
intelligence technology
services, research and
development and sales
of rail transit vehicle
and ground products
China 2020 123,044 18.0% Bank
transfer
Supplier C(1) . . Technology
development services,
hardware exhibition
hall
Engaged in the
development of
artificial intelligence
basic software and the
construction of public
data platforms, as well
as engineering
technology and design
services
China 2019 73,551 10.7% Bank
transfer
Cotell
Intelligent
Technology
(Shenzhen)
Co., Ltd. . . .
Technology
development services,
software and hardware
system expansion and
integration
Engaged in the
development and sales
of software and
hardware for office
equipment, intelligent
control products, and
audio and video
information terminal
products
China 2019 42,437 6.2% Bank
transfer
Supplier L(1) . . Hardware Engaged in sales of
medical instruments to
hospitals
China 2023 29,069 4.2% Bank
transfer
Supplier E(1) . . Hardware Engaged in research
and development,
design, and sales of
integrated circuits and
related products
China 2019 28,896 4.2% Bank
transfer
Total 296,997 43.4%
Note:
(1) This supplier did not consent to the disclosure of its name in this prospectus.
234


--- page 244 ---
BUSINESS
Year ended December 31, 2024
Supplier
Service provided /
Products sold
Profile and background
(e.g. business, size of
operation, location) Location
Length of
relationship
Purchase
Amount
%o f
total
purchase
Settlement
method
Shenzhen
Zhiyuanlian
Technology
Co., Ltd. . . .
Technology
development services;
smart screen terminal
hardware
Engaged in technical
development of
computer software and
hardware, artificial
intelligence technology
services, research and
development and sales
of rail transit vehicle
and ground products.
China 2020 113,960 12.6% Bank
transfer
Supplier
C(1) .......
Technology
development services;
hardware exhibition
hall
Engaged in the
development of
artificial intelligence
basic software and the
construction of public
data platforms, as well
as engineering
technology and design
services.
China 2019 107,609 11.9% Bank
transfer
Cotell
Intelligent
Technology
(Shenzhen)
Co., Ltd. . . .
Technology
development services;
software and hardware
system expansion and
integration
Engaged in the
development and sales
of software and
hardware for office
equipment, intelligent
control products, and
audio and video
information terminal
products.
China 2019 88,909 9.8% Bank
transfer
Shanghai
Yanshu
Computer
Technology
Co., Ltd. . . .
Technology
development services;
intelligent voice
development
Engaged in information
technology and
technical services.
China 2021 57,278 6.3% Bank
transfer
Xiamen Meiqi
Information
Technology
Co., Ltd. . . .
Technology
development services
Engaged in research
and development,
design, and sales of
integrated circuits and
related products.
China 2020 33,884 3.7% Bank
transfer
Subtotal 401,640 44.2%
Note:
(1) This supplier did not consent to the disclosure of its name in this prospectus.
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 in each year of the Track Record
Period.
235


--- page 245 ---
BUSINESS
COMPETITION
The AI solutions industry in which we operate is highly competitive. According to Frost &
Sullivan, AI solution providers compete with one another and traditional solution providers based on
factors including i) top AI research talent pool, ii) self-developed and powerful AI infrastructure, and
iii) industry and customer coverage. See “Industry Overview.” We primarily compete with other
companies that focus on developing and commercializing AI products and solutions. With respect to
each industry vertical that we have entered, we also compete against providers of traditional solutions
which are not AI-driven in such vertical. We may also in the future face competition from new entrants
that will increase the competition. For example, more established technology companies that possess
substantial financial resources, sophisticated technological capabilities and broad sales channels may
develop solutions that directly compete with ours.
We believe that the following key edges set us apart from our competitors.
Š Technology Roadmap: In the medical industry, where basic information technology
infrastructure and digitization of industry knowledge have been established, the ability to
process general industry knowledge and specific medical records intelligently, such as
through analysis, extracting, decision-making, is key to improving diagnostic efficiency
and quality. Technologies like natural language processing, multimodal interaction
technology, medical knowledge graph, and large language models are among the most
advanced and effective for intelligent processing of medical data. We possess these core
technologies and maintains a leading technological level in the industry, as proven with a
vast amount of business practice, thus giving us a clear technological edge over
competitors with traditional technologies or those possessing the same technologies but
lacking in technological proficiency. In terms of IoT solutions, we focus mainly on fields
where the demands for human-machine interactions are high, like hospitality, elderly care
and transportation. Such scenarios not only require connections among objects but also
interactions between humans and objects, understanding of human behavior,
understanding of various objects and matters in a given space and understanding of
interactions among humans and objects. Consequently, the core technologies involved are
not just IoT infrastructure, but also AI technologies related to the interaction, processing
and analysis of unstructured data, and the summarization and distillation of industry
knowledge to facilitate understanding.
Š Technological Early-mover: We have been committed to the R&D and practice of the
above core technologies for many years. With substantial R&D investment, a well-
rounded team, and an industry-leading technological level, we have amassed a wealth of
knowledge, experience and market-proven products. As a result, we believe that we enjoy
technological early-mover advantage over other solution providers. See “– Our Strengths –
Early entrant in AGI Technologies.”
Š Self-developed Atlas AI infrastructure: Our Atlas AI infrastructure performs (i) the
dynamic dispatch of computing power resources based on shifting business demands; (ii)
the initial training of large language models based on massive volume of data; and (iii)
efficient optimization guided by selected high-quality user feedback. Robust AI
infrastructure supports the constant advancement of UniBrain, helping us keep up with
technological advancement and deliver innovative AI solutions with strong performance.
236


--- page 246 ---
BUSINESS
Š Customer Base: Our long-term cooperation with hospital customers, emphasizing data
connectivity and service quality, resulted in a large network of highly engaging hospital
customers, forming a robust industry relationship and laying a solid foundation for future
collaborations. Our long-term cooperation with Daily Life solution customers emphasizes
strong integration with customer application scenarios and one-stop solutions for customer
pain points, gaining strong market reception. We have a diverse and highly satisfied customer
base. In 2022, 2023 and 2024, our Daily Life offerings served 299, 294 and 313 enterprise
customers and 86, 112 and 121 system integrators/agents, respectively, while our Healthcare
offerings served 165, 167 and 166 customers, respectively.
Š Talent Pool: We have accumulated a team with profound understanding of core AI
technologies and their application. This team’s experience is crucial for continual
innovation, grasping industry trends, determining technological routes, and implementing
product solutions. We believe that we enjoy a strong talent barrier. See “– Our Strengths –
Experienced Management Team and Core Personnel.”
LOGISTICS AND INVENTORY MANAGEMENT
Logistics and Warehouse
In general, our suppliers are responsible for delivering the hardware components and
manufactured products to our designated warehouses. Subject to the agreements entered into with our
customers, certain hardware products are delivered directly from the suppliers to the venue specified
by our customers and the delivery costs are borne by the suppliers. To the best of our knowledge, all of
the logistics service providers are Independent Third Parties.
Inventory Management
Our inventory primarily consists of raw materials, components and work in progress. We
continue to monitor our inventory, especially our inventory turnover days and the age of our inventory,
to keep it at a level sufficient to meet our customers’ orders. Our inventories amounted to
RMB33.6 million, RMB67.9 million and RMB140.3 million as of December 31, 2022, 2023 and 2024,
respectively. We have set up an inventory control policy to monitor our inventory levels and minimize
obsolete inventory. Through purchases of raw materials and components from suppliers on an as-
needed basis, we are able to carry fewer inventories and lower our inventory risk. However, to avoid
any shortage of supplies, we may strategically keep a higher level of stock for certain key hardware
components and raw materials to avoid possible industry-wide shortages. We also actively assess
changes in market conditions and strategically pre-stock certain raw materials to address potential
supply shortages. Our supply management team and our business operations team regularly review our
inventory levels, inventory composition and inventory turnover rates, and take necessary actions to
minimize the risk of obsolescence.
EMPLOYEES
As of December 31, 2024, we had 464 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 .......................................... 3 2 2 69.4
Sales and Marketing ................................................ 8 1 17.5
Administration .................................................... 6 1 13.1
Total ............................................................ 464 100.0
237


--- page 247 ---
BUSINESS
We primarily recruit our employees through online channels, including social media and our
company official website, and internal referral program. We are committed to establishing competitive
and fair remuneration. In order to effectively motivate our employees, we continually refine our
remuneration and incentive policies through market research. We conduct performance evaluation of
our employees annually to provide feedback on their performance. Compensation for our employees
typically consists of basic salary and a performance-based bonus.
In order to advance the skills and knowledge of our employees as well as to explore new
potential from our workforce, we invest in continuing education and training programs for our
management and ordinary staff members to update their skills and knowledge periodically to ensure
their awareness and compliance with our policies and procedures, as well as the relevant laws and
regulations.
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.
None of our employees are currently represented by labor unions. 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 purchase insurance in accordance with PRC legal and regulatory requirements as well as
our overall assessment of operational needs and industry management. We are bound by the social
insurance system in the PRC and pay five types of insurance for our employees, including basic
pension, basic medical care, unemployment, work-related injury and maternity insurances. We also
purchase director liability insurance for Directors, which gives appropriate coverage for any legal
action brought against our Directors. We consider our insurance coverage adequate as we maintain all
the mandatory insurance policies required by PRC laws and regulations and in accordance with the
practice in our industry. In line with general market practice, we do not maintain any business
interruption insurance or product liability insurance, which are not mandatory under PRC laws. We do
not maintain keyman insurance, insurance policies covering damages to our network infrastructures or
information technology systems, nor any insurance policies for our properties. During the Track
Record Period, we did not make any material insurance claims in relation to our business. See “Risk
Factors — 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.”
SOCIAL RESPONSIBILITY AND ENVIRONMENTAL PROTECTION
We are committed to the promotion of corporate social responsibility and environmental
protection. We are subject to environmental protection and occupational health and safety laws and
regulations in the PRC, violation of which may result in various administrative penalties from
competent authorities such as warnings, fines, orders to rectify, orders to disclose relevant information
or make an announcement or orders to suspend business. See “Regulatory Overview.”
238


--- page 248 ---
BUSINESS
Environmental Protection
Our main greenhouse gas (“ GHG”) emissions are indirectly generated through usage of
centralized data centers, where our intelligent computing cluster is. Therefore, we have undertaken
environmental improvements in the centralized data centers and office spaces, including wastewater
treatment, solid waste classification, recycling and reduction, noise control and energy-efficient
lighting and ventilation, to reduce impact on the environment from our operations. In particular, we
typically sell e-waste to professional recycling companies holding related qualifications. In addition,
most of the lamps used in our office are energy-saving LED lamps.
As we improve our AI models, fine tune our AI algorithms and optimize the storage, bandwidth
and computing power for large-scale machine learning tasks, we are able to shorten the training time
needed for our AI model and utilize the hardware resources efficiently, thereby achieving the same
results with less computing power and, in turn, saving electricity consumption. For example, our
intelligent computing cluster carries out deep engineering efficiency optimization of parallel
mechanisms, which fully utilize computing and bandwidth resources and thereby save power
consumption effectively. Moreover, we believe that as AI and its application develop and mature, AI
can solve problems more efficiently than traditional technologies, ultimately resulting in less energy
consumption.
We have been optimizing the computation-intensive services and migrating such services to the
cloud to reduce server purchases and data center renting. With the iterative upgrades of Atlas AI
Infrastructure, we have transformed from the traditional operation model of purchasing servers and
renting data centers to house and maintain the servers only to a more efficient model which integrates
cloud-based computational power provided by leading cloud computing providers on top of the
traditional model. Starting in 2016, we have invested significant research and development efforts in
technology upgrades and transformations to migrate our business system to the cloud, reducing server
purchases and data center renting. Following strict internal procurement policies, we have selected to
collaborate with leading cloud computing providers, whose data centers comply with national
standards for carbon emissions.
We stress the importance of collaborating with high-quality service providers of low-energy
consumption in our selection of data center and cloud service providers. Since our renting the first data
center in Beijing in 2012, we have conducted market research and consulting to select data center
service providers with low power usage effectiveness (PUE) values for cooperation and service
migration. For example, our intelligent computing cluster utilizes a data center in Ulanqab, which
leverages new energy power systems to further reduce carbon emissions.
In addition, we make efforts to collectively build a green office culture in our daily work,
ensuring low-carbon and environmentally friendly practices. We advocate and implement protection
measures for air, climate, water resources and forest resources. We are also dedicated to enhancing the
efficiency of electricity and water consumption in our operations to fulfill our environmental and social
responsibility. We encourage the use of public transportation in daily commutes and provide green
energy buses for employees. We require employees to turn off all electrical devices when leaving
work. If no one is working in the office area, lights should be switched off. We also encourage
electronic communication methods like online conference platforms to reduce carbon emissions from
business travel Long-distance. For water conservation, we assign personnel to regularly inspect the
water supply and drainage systems in restrooms and pantry areas so that we may promptly identify and
239


--- page 249 ---
BUSINESS
repair any leaks. We promote double-sided printing and copying, and have designated “Waste Paper”
and “Reusable Paper” collection bins in the office, encouraging employees to prioritize using single-
sided paper collected in the “Reusable Paper” bin for printing and copying. We promote a paperless
working environment to reduce consumption of paper in the daily office operations by encouraging
employees to work and communicate internally and externally through email and electronic file
formats and migrating our operations systems, such as process application, management system
promulgation, document circulation and code review, to cloud-based electronic office services system.
Moreover, we promote water conservation in our daily office practices by encouraging the use of
personal water bottles and providing filtered water dispensers in the office area, reducing the use of
bottled water and promoting environmental conservation and low-carbon practices.
We engage a third-party carbon reduction consultant to help us formulate overall carbon
reduction training plans for our staff. Under such arrangement, experts from the Shanghai Environment
and Energy Exchange, the Shanghai Branch of China Quality Certification Center and the Shanghai
Economic Information Center provide comprehensive training for our employees on carbon markets
and carbon emissions. Several of our employees have received training certificates issued by the
Shanghai Environment and Energy Exchange Co., Ltd.
In our business operation, we identified the growing demands for low-carbon and zero-carbon
solutions of industrial parks, especially against the backdrop of carbon peaking and carbon neutrality
policies and initiatives. We developed the carbon management platform for enterprise and public sector
customers. This platform integrates modules including carbon reduction advisory management, carbon
emission data tracking and user carbon-footprint management. This platform is one of our UniBrain
modules. It is currently being applied internally and offered to customers as a MaaS-based service.
We do not expect that we will incur any material liabilities in this regard which can have any
material adverse impact on our business and operating results. During the Track Record Period and up
to the Latest Practicable Date, our operations were in compliance with the relevant PRC environmental
protection and occupational health and safety laws and regulations in all material aspects and we had
not been subject to any fines or other penalties due to non-compliance with environmental protection
and occupational health and safety laws and regulations.
Corporate Governance
Our Board of Directors has adopted a comprehensive ESG policy in accordance with the
Listing Rules, which sets forth our corporate social responsibility objectives and provides guidance on
practicing corporate social responsibility in our daily operations.
Our Group’s ESG strategy and goals are determined by the Board of Directors and
implemented by the ESG committee. The ESG committee is responsible for planning and
implementing the company’s ESG strategy, goals and policies under the supervision of the Board.
They also identify and assess ESG risks and opportunities for our Group. The ESG committee
establishes an ESG working group, led by the general manager and consisting of heads from various
functions and business departments, to comprehensively advance and execute specific ESG-related
tasks, including managing ESG-related risks and matters in the company’s daily operations,
coordinating and promoting the execution of ESG-related initiatives and preparing the annual ESG
report.
240


--- page 250 ---
BUSINESS
Social Responsibility
We are committed to providing customers with safe, reliable and high-quality products and
offerings. We respect customer privacy and data security, and proactively respond to customer
feedback and needs. We also actively collaborate with suppliers, partners and communities, advocate
for fair and equitable business partnerships, and support local economic and social development. To
combat COVID-19 pandemic, we supported hospitals in Beijing, Xiamen, Guangxi, Shandong and
Wuhan with our medical services. Through our advanced voice interaction functions, medical staff
were able to collaborate effectively with virtual communication, thus mitigating the risk of infection.
We donated and installed contactless elevator to enterprise and municipality. The deployment of voice-
controlled elevator system allowed passengers to control the elevator without physical contact,
reducing the risk of infection. We also donated robots developed for pandemic prevention to
communities in Beijing, Shanghai, Xiamen, Quanzhou and Sanming. These robots provided phone call
assistance for individuals and medical institutions, streamlining the massive workload of COVID-19
pandemic prevention related communications.
Employee Care
We strive to build a fair, transparent and encouraging working environment. Our internal
workplace policies are constantly reviewed to ensure compliance with relevant laws and regulations, as
well as the culture and values of our team.
We aim to provide our employees with competitive compensation. Besides salary and cash
incentives, we also provide employees comprehensive benefit packages, including festival and holiday
gifts, extra annual leave allowances beyond the statutory minimum, supplementary commercial
medical insurance and annual outings.
Impact of ESG-related Risks
Climate-related issues may bring about the risk of increasingly severe extreme weather events,
such as more frequent storms and typhoons, that may cause disruptions to the equipment and facilities
essential to our business operations. Extreme weather may also cause threat to the health and safety of
our employees. We may potentially be impacted by an increased operation and maintenance cost and
an increased labor cost.
The potential changes in social trend and political policies relating to ESG, such as
transitioning to a lower-carbon economy, may cause us to incur additional costs in order to comply
with the more stringent rules. For example, it could cost us a substantial amount of time and resources
to constantly monitor the latest developments in ESG laws and regulations that may become applicable
to us. We may also incur increased cost to execute more stringent monitoring measures on emissions
and resource consumption. Any failure to comply with environmental regulations would expose us to
penalties, fines, suspensions or actions in other forms.
For more details, see “Risk Factors — Risks Relating to Our Industry and Business — We are
required to comply with the applicable laws and regulations on environmental, social and governance
matters and changes in social trend and political policies relating to ESG may have a material adverse
impact on us.”
241


--- page 251 ---
BUSINESS
Metrics and Targets for Assessing and Managing ESG Risks
The venue for our daily operations is our offices and centralized data centers, and the most
significant resource consumption thereof is the use of electricity, water and paper. During the Track
Record Period, we sourced energy mainly from external sources and a portion from renewable sources.
We carefully select buildings with ESG credentials for our offices and data centers to align with our
sustainability objectives. For example, our Beijing office park incorporates several sustainable
initiatives, such as using solar power on parking structures to reduce reliance on traditional energy
sources while lowering carbon emissions. The park also uses hydrogen-powered shuttle buses for
employee transport and installs electric vehicle charging stations to promote efficient energy use. Our
Shanghai office building is a LEED Certified Building, utilizing natural lighting and ventilation to
reduce dependence on indoor lighting and air conditioning. It features IoT and smart control systems
for lighting, temperature control and office management, enabling real-time monitoring of energy
consumption and environmental quality. The building also employs energy-saving technologies, green
materials, and indoor greenery to create an ecofriendly office environment, enhancing employee
experience and supporting our environmental goals. We monitor the following metrics to assess and
manage the environmental and climate-related risks arising from our business operations:
Š (1) electricity usage . We evaluate our electricity and water consumption in accordance
with relevant regulations and policies and endeavor to proactively conserve energy in
response to the government’s initiatives. Electricity usage is also the major source of our
GHG emissions during our business operations. We are conscious of the energy efficiency
of our offices and data centers, and place an emphasis on the use of renewable energy
sources. A portion of our electricity is generated from renewable sources, and we
supplement this by procuring additional electricity externally. We monitor our electricity
consumption levels regularly and implement measures such as promoting use of natural
lighting, reducing the use of air conditioners and electronic equipment during non-working
hours to save energy and reduce GHG emissions and to further enhance our employees’
awareness of efficient use of electricity and the importance of energy conservation. The
majority of our office lighting is provided by LED energy-saving lights. For the years
ended December 31, 2022, 2023 and 2024, the electricity consumption of our offices was
around 880.0 MWh, 919.9 MWh and 1089.4 MWh, respectively. The electricity
consumption of the centralized data centers was 2,886.0 MWh, 5,011.8 MWh and 5,178.0
MWh, respectively. We target to reduce our total electricity consumption by 6% by 2027
and by 15% by 2030. To achieve this goal, we plan to take comprehensive measures,
including strictly adhering to national standards for air conditioning temperatures,
reducing air conditioning usage during nights where the condition allows, replacing
energy-consuming office equipment with energy-efficient alternatives, turning off lights in
unoccupied areas at night, improving engine efficiency to lower the power consumption of
the computing infrastructure in providing cloud services and transitioning to more energy-
efficient third-party data centers;
Š (2) GHG emissions . GHG emissions are produced by us mainly due to the use of
electricity during our daily operations. In 2022, 2023 and 2024, our offices used in total
880.0 MWh, 919.9 MWh and 1,089.4 MWh of electricity, respectively, which accounted
for around 537.0 tons, 561.2 tons and 664.5 tons of carbon equivalent emissions under
scope 2 indirect GHG emissions for electricity purchased, and our centralized data centers
used in total 2,886.0 MWh, 5,011.8 MWh and 5,178.0 MWh of electricity, respectively,
which accounted for around 1,760.8 tons, 3,057.7 tons and 3,159.1 tons of carbon
242


--- page 252 ---
BUSINESS
equivalent emissions under scope 2 indirect GHG emissions for electricity purchased. The
increased electricity usage in the year ended December 31, 2024 was primarily due to our
increased computing power associated with the training and running of large language
models. We aim to reduce carbon emission by improving energy efficiency in our
operation. We have been gradually increasing the proportion of data centers with lower
PUE to increase the energy efficiency in data centers. We monitor our electricity
consumption levels regularly and implement measures such as: (i) reducing the use of
electronic light when the natural lighting is sufficient; (ii) not using air-conditioners when
the natural room temperature is suitable for office work; and (iii) turning off air-
conditioners, computers and other electronic equipment during non-working hours to
enhance our staff’s awareness of efficient use of electricity and the importance of energy
conservation. In particular, we endeavor to reduce the intensity of carbon emission so that
we may achieve overall carbon neutrality in 2030 and achieve net zero emissions in 2050.
As the majority of our GHG emissions result from the use of electricity, our target and
specific measures to reduce GHG emissions align with our initiatives and efforts to reduce
our electricity use; and
Š (3) waste generated. Due to the nature of our business, we do not generate any hazardous
waste during our operations. We typically sell e-waste to professional recycling companies
holding related qualifications or disposed them according to the waste sorting and disposal
rules stipulated by the government. In order to reduce the impact of our disposal of non-
hazardous waste on the environment, we monitor our waste discharge level on a regular
basis. Proper guidelines are provided to our employees on waste classification and disposal.
We also enhanced our waste management approach of our offices, centralized data centers
and computing clusters based on the principles of resource utilization, reduction of waste
generation and harmless treatment. We target to maintain 100% compliance rate in relation
to waste disposal.
BUSINESS SUSTAINABILITY
We have experienced continuous revenue growth during the Track Record Period. Our revenue
increased from RMB600.6 million in 2022 to 727.3 million in 2023 and further increased to
RMB939.0 million in 2024. Our gross profit margin remained relatively stable at 39.9%, 40.5% and
38.8% in 2022, 2023 and 2024, respectively. During the Track Record Period, our customers increased
from 538 in 2022 to 555 in 2023 and further increased to 576 in 2024. This was primarily as a result of
the increase in the wide variety of AI solutions and products we offered and the increase in their
applicable industries, as well as the increased demand for intelligent medical solutions along with the
intelligence upgrade of internal systems among hospitals. The number of our Major Customers
increased from 92 in 2022, to 104 in 2023 and further increased to 106 in 2024. Our revenue from
Major Customers increased from RMB538.6 million in 2022, to RMB666.4 million in 2023, and
further increased to RMB875.1 million in 2024. Our long-term strategy of optimizing customer base
and focusing on major customers has proved to be effective. It drove our rapid revenue growth while
helped us maintain a stable gross profit margin, underpinning sustainable growth. Our capability in
enhancing AI technologies to deliver targeted and innovative AI products and solutions that meet
evolving customer needs, combined with our success in expanding our customer base and deepening
customer relationships, ensures that we can achieve long-term and sustainable business growth.
243


--- page 253 ---
BUSINESS
We have maintained our market position as one of the leading players in China’s AI solution
industry. According to Frost & Sullivan, despite the intense competition within the industry, we have
ranked among the top five market players by revenue in each year of the Track Record Period. During
the Track Record Period, our market share stood stably at 0.6%, ranking fourth, in China’s AI solution
industry. The combined market share of the top three players declined significantly from 22.0% in
2022 to 13.8% in 2024, indicating reduced concentration. We have also accelerated our R&D
investments in 2024 to maintain our competitiveness. Since January, 2025, China’s AI solution
industry has seen significant new demands for cutting-edge technologies, and is growing at an
accelerated pace, according to Frost & Sullivan. Considering the above factors, we believe that we are
well-positioned to capture increasing market opportunities and enhance our market position.
We expect to increase market share by enhancing the integration of our offerings with
customers’ evolving businesses. Our early-mover advantage and reputation in AGI technology and
ability to support a diverse range of products and solutions in various end Confirmed, combined with
our experience accumulated from years of practice in the AI market, form the competitive edge
underpinning our further expansion.
According to Frost & Sullivan, the market size of AI solution in Daily Life provided by AI
solution providers in China increased from RMB3.0 billion in 2019 to RMB10.5 billion in 2024,
growing at a CAGR of 28.7%, and is expected to reach RMB149.6 billion in 2030 with a CAGR of
55.7% from 2024 to 2030. Under Daily Life, for example, our AI chip has penetrated the market of
fans and heaters in the home appliances industry, which have a market size of hundreds of millions of
units in China. Our AI chip can empower home appliances with AIoT functions based on voice control.
In 2023, there were only about 5 million sales of voice-controlled fans and heaters in the Chinese
market, representing a penetration rate of less than 5% while we had a substantial market share, thanks
to our strategy of leveraging our established expertise and track record to attract new customers and
strengthen our relationships with existing ones. Meanwhile, we have been actively exploring
opportunities to expand into other industry verticals where our knowhow and technologies are
translatable, such as lighting appliances, switch panels and bathroom appliances. According to Frost &
Sullivan, the market size of AI Service and Solution in Healthcare in China increased from RMB1.1
billion in 2019 to RMB9.9 billion in 2024, growing at a CAGR of 54.3%, and is expected to reach
RMB146.5 billion in 2030 with a CAGR of 56.6% from 2024 to 2030. Under Healthcare, we intend to
(i) improve the market penetration rate of existing products. As the hospitals’ management systems
become increasingly digitalized as a result of both their own endeavors to improve management
efficiency and favorable governmental policies, the demand for corresponding intelligent products is
expected to continue to increase, see “— Expanding customer base and retaining existing customers,”
and (ii) introduce new and more advanced products and enrich our product portfolio with the support
of UniGPT. With the launch of UniGPT, we fully utilize the perception, reasoning and generation
capabilities of large language models to meet hospitals’ intelligence demands, such as medical record
generation. See “— Continually enhance and enrich our products and solutions.”
Eliminating the impact of items including (i) share-based payment expenses; (ii) finance cost of
interest on redemption liabilities; and (iii) listing expenses, we generated an adjusted net loss (non-
IFRS financial measure) of RMB183.2 million, RMB136.6 million and RMB168.4 million in 2022,
2023 and 2024, respectively, accounting for 30.5%, 18.8%, and 17.9% of our revenue for the same
year, respectively. Adjusted net loss is a non-IFRS measure. See “Financial Information — Non-IFRS
Financial Measure.”
244


--- page 254 ---
BUSINESS
Our net losses were primarily due to the significant amounts of R&D expenses incurred during
the Track Record Period. The absolute amount of our R&D expenses increased during the Track
Record Period as our business grew. We have started to implement prudent measures to manage our
costs and operating expenses.
We closely monitor the adequacy of our cash position in light of 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 and wealth
management products at fair value through profit or loss of RMB74.1 million, RMB448.2 million and
RMB156.5 million as of December 31, 2022, 2023 and 2024, respectively. We completed the Series D3
financing in 2023 and raised more than RMB700 million. We have implemented a series of strategic
measures to ensure adequate working capital and improved liquidity. We have strengthened our trade
receivable management by assigning dedicated personnel to follow up on collections, negotiate repayment
plans with customers and take legal action when necessary. Meanwhile, as part of our long-term endeavor
to optimize our customer base, we have refined our client selection process to prioritize collaboration with
financially stable customers, enhancing the recoverability of future receivables and the efficiency of our
resource utilization. Payment terms have also been optimized by increasing customer prepayments,
shortening payment cycles and aligning project implementation with payment cycles. We are also
improving inventory turnover and supply chain management by negotiating more flexible payment terms
with suppliers. In addition, we have worked to maintain strong relationships with banks and financial
institutions to secure and fully utilize available credit facilities, ensuring access to necessary funding. To
preserve cash flow, we have enforced strict cost controls, which includes prudent review of non-essential
and non-urgent expenditures. Taking into account the financial resources available to us including our cash
and cash equivalents on hand, unutilized bank facilities and the estimated net proceeds from the Global
Offering, our Directors are of the view that we have sufficient working capital to meet our present
requirements and for the next 12 months from the date of this prospectus. Taking into account the
independent due diligence conducted by the Joint Sponsors, and based on the written confirmation from the
Company in respect of working capital sufficiency, review of the accountants’ report and the Company’s
indebtedness status, the financial due diligence conducted on the historical financial information of the
Group during the Track Record Period and the discussion with the Directors, nothing material has come to
the attention of the Joint Sponsors that would cast doubt on the Company’s conclusion that the Company
has sufficient working capital to meet its present needs and at least for the next 12 months from the date of
this prospectus.
We recorded net losses and net operating cash outflow during the Track Record Period, and we
currently expect such positions may continue until we achieve a greater scale. Nevertheless, our net
losses as a percentage of our revenue decreased from 62.5% in 2022, to 51.7% in 2023 and further
decreased to 48.4% in 2024. We expect to enhance revenue and profitability by retaining and
expanding high quality customer base, optimizing the value derived from major clients, and fostering
the development and synergies of AI products and solutions. Specifically, we aim to achieve
profitability primarily through:
(I) Continually enhance and enrich our products and solutions
We continually enhance and enrich our products and solutions and diversify our product
portfolio leveraging the enhancement of Atlas AI infrastructure and UniBrain technology platform,
which are expected to elevate our R&D efficiency and accelerate the iterations of our products and
solutions.
245


--- page 255 ---
BUSINESS
Since the launch of UniGPT in May 2023, we have been incorporating it in our existing products
and solutions to enhance their intelligence in application scenarios. UniGPT significantly enhances both the
language comprehension and generation capabilities of the products and solutions. Unlike typical systems
that can only understand specific command structures from users, it can comprehend more complex
language expressions from users, enabling more human-like generation. In contrast to standard systems
heavily reliant on developers for manual knowledge graph development, UniGPT can autonomously learn
and develop. For example, the medical record solution has been transformed from a specialized tool that
combines speech-to-text and a mechanical workflow to produce a summary to a more human-like system
that recognizes, understands, summarizes and generatesfinal electronic medical records based on medical
dialogs. The medical record generation system is capable of increasing the outpatient medical record input
efficiency by around 80% and reducing the individual patient visit time spent with the doctors by around
15%, thereby elevating patient satisfaction. Since its launch, UniGPT has continuously undergone
technological advancements that enhance its multimodal and reasoning capabilities based on its language
capabilities. Built on its multimodal abilities, UniGPT is capable of processing and integrating information
across various modalities, thereby allowing it to better understand complex scenarios, which improves
human-machine interaction. In tandem with its enhanced reiterated reasoning capabilities, our UniGPT has
significantly increased its ability to process complicated information and tasks. As of December 31, 2024,
we had 65 customers who used UniGPT powered products and solutions, where the aggregate value of
contracts that had been executed and recognized revenue amounts to RMB74.2 million. As of the same
date, the aggregate value of our potential contracts related to UniGPT-powered products and solutions
reached RMB304.9 million. UniGPT opens the door to opportunities for us to win over customers who
generally are not interested in homogeneous substitutes.
Š Since the launch of UniGPT in May 2023, we have contracted with interested customers
across industry verticals such as new energy vehicle and public transportations and
generated revenue from this technology. In October 2023, a customer inquiry system
supported by UniGPT was deployed at a train station, which automatically handles
passengers’ inquiries and provides accurate and timely responses. Passengers can input
their destination through speech, and the system will provide the optimal travel route that
suits their travel requirements. We have received favorable feedback from our customer.
Likewise, a subway station also chooses to install an interactive system supported by
UniGPT at its customer service station to make it more convenient for passengers to get
directions.
Š Our human-vehicle interaction solutions, also improved by UniGPT, have been integrated
into various car models from different automakers. UniGPT improves user experience for
both drivers and passengers with its enhanced ability to understand human intention. For
example, our UniGPT is integrated into the control system of a car model to empower its
virtual assistant, transforming it from a simple task executor to a digital partner that can
engage in more human-like conversations. Compared to the traditional car voice assistants
whose voice interaction is often command-based, and are only able to react to preset
questions and answers, the virtual assistant can give human-like feedback and better
understand user intentions. In addition, its knowledge capabilities and adaptability can
provide users with more accurate and personalized services. As the traditional voice
assistants have been commonly installed on cars, according to Frost & Sullivan, we
anticipate increasing demands from car manufacturers to use UniGPT to upgrade their
existing voice assistants. We are also in discussions with car manufacturers for prototype
246


--- page 256 ---
BUSINESS
design and development. We are also working with a leading new energy car manufacturer
in China to explore the application of voice synthesis technology in car marketing. Since
its adoption by the leading automotive manufacturer, it has been promoted to a wider
range of automotive OEMs and gained wider attention from downstream users such as
railway stations and airports. Moreover, we have been approached by an increasing
number of customers who viewed our products online. As of the Latest Practicable Date,
the aggregate value of contracts related to our customer inquiry system and the interactive
customer service system, as well as the human-vehicle interaction solutions, both
supported by UniGPT that had been delivered and have generated revenue of
approximately RMB11.3 million; the aggregate value of our potential contracts related to
our customer inquiry system and the interactive customer service system, as well as the
human-vehicle interaction solutions supported by UniGPT amounts to approximately
RMB154.3 million. The customers consist primarily of established car manufacturers and
renowned global technology companies.
Š Beyond human-vehicle interaction, leveraging the generative power of UniGPT, we are
able to provide our customers with solutions that involve data search and decision-making,
which in turn helps us to expand our customer base across a wider range of industries. Our
customers involve but are not limited to railway owners. As of the Latest Practicable Date,
such UniGPT-powered solutions had been delivered or were in the process of delivery.
Meanwhile, we actively contribute to building computing power for external clients by
offering integrated hardware and software solutions. We have leveraged our expertise in
helping clients select the AI chips that tailored to their operational needs.
Š We are also continuing to promote new functionalities enabled by UniGPT in Healthcare use
cases. For instance, we have been involved to equipment an outpatient medical record
generation system, a radiology report generation system, an imaging report quality control
system and a multimodal imaging quality control platform powered by UniGPT for Beijing
Friendship Hospital. As of the Latest Practicable Date, such systems were in trial operations,
other than the multimodal imaging quality control system, which was still under development.
We are also in business negotiations with several other hospitals regarding the adoption of the
same product.
By further enhancing and upgrading UniBrain and combining it with the industry insights, we
will be able to produce more powerful and comprehensive products that give us a competitive edge.
Specifically,
Daily Life: In 2025, we plan to continue to iterate our UniGPT to enhance user experience by
strengthening its ability to understand human intention. The proprietary nature of our UniGPT
allows us sufficient autonomy and flexibility to customize and optimize its use, thereby giving
us a competitive edge to meet varied customer demands in a cost-effective manner. Moreover,
in the field of cockpit noise reduction, we plan to shift from traditional experience-driven signal
processing to data-driven deep-learning approach. By analyzing recorded cockpit noise data
through deep-learning model, we aim to provide efficient and tailored noise reduction solutions
that caters to varied customer needs, thereby enhancing our competitiveness. In 2025, we are
also developing products and solutions that target customer beyond China. Therefore, one of
the key new feature of our product will be the support for multiple languages.
247


--- page 257 ---
BUSINESS
We are enhancing our multimodal generation technology to improve the accuracy of
multi-round dialog context understanding. This will allow it to instantly provide answers based
on customer-provided data, thereby enhancing user interaction experience.
Healthcare: We will continue to apply large language model technology to improve the
intelligence of the existing medical record quality control, service supervision and payment
management solutions. Powered by UniGPT, we expect to broaden the application of our
solutions, such as clinic medical record generation system and surgical record assistant, to more
application scenarios.
Furthermore, as we diversify our product portfolio, we anticipate that our gross profit margin
will remain relatively stable. Specifically, we maintain active communication with customers to
establish the scope and scenarios where AI technologies can help upgrade performance. In addition,
our AI technologies are constantly being refined. By integrating AI technology services more
comprehensively across various sectors and departments within our customers’ organizations, we
anticipate a sustained demand for new and upgraded AI services along with the continuous iteration
and advancement of the AI technologies. For instance, we have a bank customer who has been
integrating core AI capabilities into its diverse business functions, thereby having repeat purchases
from us each year; and broadening our customer base. Drawing upon our proven track record of
successful collaborations with lighthouse customers across diverse sectors, we engage with potential
customers by utilizing referrals from our existing customer base or through direct outreach initiatives.
During negotiations, we strategically highlight our portfolio of successful cases to demonstrate our
expertise and the value we can bring to the collaboration. For example, leveraging our cases with major
commercial banks, we have secured contracts with local commercial banks, and we are actively
negotiating with more commercial bank.
(II) Expanding customer base and retaining existing customers
By leveraging the expertise gained from working with lighthouse customers and the capabilities
empowered by Atlas AI infrastructure and UniBrain technology platforms, we plan to (i) extend our
solutions for existing application scenarios, which are highly replicable, to new customers and
(ii) extend our solutions for new application scenarios to existing customers.
(i) Extending our solutions for existing application scenarios to new customers
The digitalization trend has driven the demands for AI-driven solutions. The customers of
Daily Life are mainly in the fields of home appliances, hotels, residences, commercial spaces and
transportation. According to Frost & Sullivan, the number of customers in these application scenarios
is relatively large and dispersed, and there is still considerable room for growth in the number of
customers covered. For example, after providing Daily Life solutions to Shenzhen Metro, one of the
exemplars in the field of rail transportation, we successfully implemented similar solutions in other
cities, including Qingdao and Chongqing.
Under Healthcare, after our launching voice-based electronic medical record solutions for
hospitals with Peking Union Medical College Hospital in 2016 and the establishment of an intelligent
medical record quality control system for a top hospital in Nanjing in 2018, potential hospital customers
learned about our products and solutions through observing the hospitals’ information technology
development, and approached us to initiate collaboration. Especially, the intelligent medical record
248


--- page 258 ---
BUSINESS
quality control system project with the hospital in Nanjing received top honors at the 2019 Smart
Healthcare Innovation Competition in Jiangsu, which bolstered our product’s visibility, attracting over 50
potential new customers, invited the interest of over 30 hospitals in visiting us to learn more about our
products, and resulting in over 10 sales. From the time we received the honors until December 31, 2024,
we had recognized an aggregate of RMB9.6 million from sales resulting from such honors we received.
With the launch of UniGPT, we are actively communicating with different types of customers,
combining their needs and the characteristics of UniGPT technology, to develop customized products.
In Healthcare, performance improvement brought by the large language model creates opportunities
for us to launch new products utilizing UniGPT based on industry needs. At the same time, we aim to
extend our offerings to potential customers in the related industries of our existing customers. We have
provided traffic accident personal injury claim review support for a commercial insurance company,
and we plan to extend such claim review support solutions to medical insurance companies. Notably,
in Healthcare, we have been able to swiftly deploy our standardized AI solutions powered by UniGPT
for new customers, as evidenced by our collaboration with three new insurance company customers in
2025.
We aim to enhance our presence in various vertical industry fields by actively seeking new
customers within these sectors who have similar needs, thereby further driving our development in
these industries. As we continue to acquire new customers, we expect the revenue to continue to grow.
The number of customers of Daily Life increased from 373 in 2022 to 411 in 2024 over a CAGR of
5.0%, while the revenue from Daily Life increased from RMB486.7 million in 2022 to RMB739.8
million in 2024 over a CAGR of 23.3%. The number of customers of Healthcare increase, from 165 in
2022 to 166 in 2024 over a CAGR of 0.3%, while the revenue from Healthcare increased from RMB
113.5 million in 2022 to RMB199.2 million in 2024 over a CAGR of 32.5%.
(ii) Extending our solutions for new application scenarios to existing customers
We plan to retain the existing customers through continuous innovation to meet changing
market and customized demands and stay competitive. We also expect that our existing customers will
find increasing value in their continued use of our products and solutions, which fosters the
development of their technological ecosystem.
We can enhance our collaboration with existing customers and tailor solutions according to
their specific needs. Under Daily Life, for example, we have robust long-term collaboration with a
financial conglomerate in Daily Life business. Starting from assisting it in building its internal
supercomputing platform, we continued to help it optimize AI engine capabilities for its applications
and develop comprehensive solutions leveraging IoT. We have also worked with a metro company to
launch customer service products after delivering the ticketing solutions to the metro lines.
Furthermore, building on our proven track record of success, we have secured a contract for an
intelligent transformation rail transportation project in Nanning and have been invited by the same
customer to provide a comprehensive solution for the construction of an upcoming science and
Innovation park. Under Healthcare, we have the capability to provide more effective products and
solutions that fulfill the increasingly demanding needs of hospital management. For example, our
cooperation with Beijing Friendship Hospital has been instrumental in fostering the growth and
continuous improvement of its information system. Since the sales of efficiency tools, including the
voice input system, in the early stage of our Healthcare business in 2019, we have expanded and
upgraded our product offerings, and continuously provided Beijing Friendship Hospital with
249


--- page 259 ---
BUSINESS
innovative products and solutions, including the medical intelligent voice system V3.0 in 2020. In
March 2022, as our cognitive technology based products and solutions advanced, the hospital engaged
us to establish a database for digestive system diseases, which was later upgraded into a utility
platform. In November 2022, we started to provide database construction services for other diseases. In
December 2022, we provided the hospital with the medical knowledge graph platform, based on which
the hospital was able to use our various innovative applications. Since the launch of our UniGPT in
May 2023, we have applied it in multiple scenarios that further deepen our collaboration with the
hospital. For example, in 2024, we introduced UniGPT to the medical record quality control system,
which has improved its accuracy. In addition, we have applied the UniGPT to our existing voice
medical record generation system and have developed three new products for the hospital, including
outpatient medical record generation system, radiology report generation system and imaging report
quality control system, which, as of the Latest Practicable Date, were in trial operation. We continually
broadened our collaboration with major customers, tapping into a wider range of scenarios and
delivering greater commercial value. For example, in 2025, when working with major medical
insurance companies, we expanded the application scenarios of our solutions from the mere review of
medical expenses and bills to automated injury level assessment and inspection based on multi-modal
technologies, and medical institution profiling. As we persistently refine and diversify our offerings,
we underscore our value by facilitating a more streamlined and effective healthcare experience for both
providers and patients.
Moreover, by participating in the system enhancements of our customers, we connect our
products and solutions with their established systems from an early phase. This process not only
cements our role within the customers’ technological framework, but also establishes barriers to entry
for potential competitors. Consequently, at the current stage, under Healthcare, while we make efforts
to retain customers, we put more emphasis and resources on acquiring new customers. The
enhancement of hospital management capabilities is fuelling the demand for intelligent solutions. As
hospitals undergo more sophisticated performance evaluations, including grading, single disease
quality control, and reforms in medical insurance payment systems such as diagnosis-related groups
and diagnosis-intervention packets, there is a growing need for the support provided by products and
solutions. Our offerings, bolstered by the improved capabilities of large-scale models, are proving to be
increasingly effective within these healthcare areas. The introduction of our new products, which align
with the evolving management requirements of hospitals, is likely to encourage repeat business from
existing customers, thus ensuring customer retention. Moreover, the exemplary results achieved by our
current customers act as a potent form of endorsement, fostering word-of-mouth that enhances our
reputation among a wider hospital clientele. This, in turn, attracts new customers and broadens our
market presence. Having a larger customer base further enhances our ability to acquire know-how in
the healthcare sector, which in turn boost the practicality, competitiveness and diversity of our products
and solutions. By expanding our Healthcare services to encompass medical review and medical
insurance fund supervision within the insurance industry, we have consistently secured new contracts
throughout the Track Record Period. This paves the way for ongoing growth and reinforces customer
loyalty.
As a result of our strengthened cooperation with the existing customers, we expect the revenue
to continue to grow. In 2022, 2023 and 2024, revenue from our retained Daily Life customers, being
the customers from whom we had revenue in both the current year and the preceding year, were
RMB279.8 million, RMB360.4 million and RMB524.5 million, respectively, accounting for 57.5%,
62.3% and 71.0%, respectively, of our revenue from Daily Life during the same years, and revenue
250


--- page 260 ---
BUSINESS
from our retained Healthcare customers were RMB35.9 million, RMB39.8 million and
RMB30.0 million, respectively, accounting for 31.7%, 26.8% and 15.1%, respectively, of our revenue
from Healthcare during the same years. While our revenue from our retained Healthcare customers as a
percentage of our revenue from Healthcare decreased during the Track Record Period, it was a result of
our strategically improving acquisition of high-spending clients as our primary focus to gain a
competitive advantage by taking part in our customers’ technologies ecosystem, leveraging our
customer acquisition resources. By doing so, we aim to increase the customer retention rate in the long
run, and, as a result, increase revenue from retained customers.
While we focus on both enhancing industry penetration and expanding new customer base, and
retaining existing customers and increasing their repeat purchases, we take into account a variety of
factors when allocating overall resources and planning the expansion of each business segment. These
factors mainly include market demand, competitive landscape, our technology capacities and the
development of our products and solutions. The following tables set out a breakdown of the number of
customers by customer type and industry for the years indicated:
Year ended December 31,
2022 2023 2024
Daily Life ............................................................... 3 7 3 3 8 9 4 1 1
- Products(1) ............................................................. 1 8 4 1 5 3 1 6 9
- Solutions
- Hotels ............................................................. 1 1 1 6 1 8
- Residences ......................................................... 1 4 2 3 2 3
- Commercial spaces .................................................. 5 1 8 0 7 4
- Transportation ...................................................... 1 3 2 6 3 6
- Others(2) ........................................................... 1 3 1 1 3 0 1 3 0
Healthcare .............................................................. 1 6 5 1 6 7 1 6 6
Notes:
(1) Daily Life products are applied across a wide range of industries, such as home appliances, office and education sectors. It is
impracticable to breakdown such segment by industry.
(2) Others include technology services, which refer to services provided to enterprises across a wide range of industries, helping them
enhance their R&D and management efficiency based on our AI technologies. Such solutions are inherently applicable across various
industries, and are not designed to be industry-specific. As such, it is impracticable to breakdown such segment by industry.
Year ended December 31,
2022 2023 2024
Existing
Customers(1)
New
Customers
Existing
Customers(1)
New
Customers
Existing
Customers(1)
New
Customers
Daily Life(2) ..................... 2 2 9 1 4 4 2 5 5 1 3 4 2 6 7 1 4 4
- Products(3) ..................... 1 2 1 6 3 1 1 4 3 9 1 0 0 6 9
- Solutions
- Hotels .................... 9 2 1 1 5 1 6 2
- Residences ................. 9 5 1 3 1 0 1 7 6
- Commercial spaces .......... 3 5 1 6 4 9 3 1 5 9 1 5
- Transportation .............. 8 5 1 0 1 6 1 5 2 1
- Others (4) .................. 6 2 6 9 6 8 6 2 7 5 5 5
Healthcare ...................... 1 1 2 5 3 1 0 7 6 0 8 9 7 7
Notes:
(1) Existing customers refer to customers from whom we had revenue both in the previous year and the current year.
(2) Some customers may have multiple contracts with us within the same year. These contracts can be under different segments and
corresponding to different customer types. For example, a customer may purchase commercial space solution for the first time and also
procure technology services within the same year while having procured technology services in the previous year. This customer would
251


--- page 261 ---
BUSINESS
be counted as both a new customer under commercial space solution and an existing customer under technology services within the same
year. However, this customer would be committed only as an existing customer under Daily Life.
(3) Daily Life products are applied across a wide range of industries, such as home appliances, office and education sectors. It is
impracticable to breakdown such segment by industry.
(4) Others include technology services, which refer to services provided to enterprises across a wide range of industries, helping them
enhance their R&D and management efficiency based on our AI technologies. Such solutions are inherently applicable across various
industries, and are not designed to be industry-specific. As such, it is impracticable to breakdown such segment by industry.
Year ended December 31,
2022 2023 2024
Existing Customers(1)
New
Customers Existing Customers(1)
New
Customers Existing Customers(1)
New
Customers
System
integrators
/Agents
Enterprise
customers
System
integrators
/Agents
Enterprise
customers
System
integrators
/Agents
Enterprise
customers
System
integrators
/Agents
Enterprise
customers
System
integrators
/Agents
Enterprise
customers
System
integrators
/Agents
Enterprise
customers
Daily Life(2) .......... 6 2 1 7 7 2 4 1 2 2 7 6 1 9 1 3 6 1 0 3 8 2 2 0 3 3 9 1 1 0
- Products(3) .......... 1 3 1 0 8 4 5 9 1 1 1 0 4 1 3 8 8 9 2 4 6 5
- Solutions
- Technology
services(4) ...... 1 8 4 9 1 0 5 9 1 9 5 1 1 7 4 7 2 6 5 4 1 5 4 2
- Hotels .......... 2 7 1 1 4 8 1 4 5 1 2 1 1
- Residences ...... 8 2 4 1 1 2 3 6 4 1 3 6 2 4
- Commercial
spaces ......... 1 5 2 2 9 7 2 4 2 8 1 9 1 2 2 7 3 6 1 3 4
- Transportation . . . 8 — 5 — 10 — 9 9 12 4 16 7
Healthcare(5) ......... 7 1 5 1 2 9 2 6 6 8 4 2 4 0 2 2 5 9 3 3 4 7 3 5
Notes:
(1) Existing customers refer to customers from whom we had revenue both in the previous year and the current year.
(2) Under Daily Life, some customers may have multiple contracts wit h us within the same year. These contracts can be under different
segments and corresponding to different customer types. For examp le, a customer may purchase commercial space solution as a system
integrator/agent for the first time and also procure technology se rvices as an enterprise customers within the same year while having
procured technology services in the same capacity in the previous year . This customer would be counted as both a system integrator/agent
and a new customer under commercial space solution, and an enterpri se customers and an existing customer under technology services
within the same year. However, this customer would be committed as an existing system integrator/agent and an existing enterprise
customers respectively under Daily Life in the same year.
(3) Daily Life products are applied across a wide range of industries, such as home appliances, office and education sectors. It is
impracticable to breakdown such segment by industry.
(4) Technology services refer to services provided to enterprises across a wide range of industries, helping them enhance their R&D and
management efficiency based on our AI technologies. Such solutions are inherently applicable across various industries, and are not
designed to be industry-specific. As such, it is impracticable to breakdown such segment by industry.
(5) Under Healthcare, the number of system integrators/agents represent the number of end users that we provided solutions to through
contracts with system integrators/agents; the number of enterprise customers represent the number of enterprise customers that we
provided solutions to through contracts directly with them. Such numbers reflect the business nature and our performance under
Healthcare. See “—Our Offerings — Healthcare” and “— Sales and Marketing — Our Sales Network.”
252


--- page 262 ---
BUSINESS
The following tables set out a breakdown of our revenue from customers by customer type and
industry for the years indicated:
Year ended December 31,
2022 2023 2024
(RMB in thousands)
Daily Life ......................................................... 486,682 578,729 739,830
- Products(1) ........................................................ 93,485 103,499 117,296
- Solutions
- Technology services (2) .......................................... 167,801 208,611 271,789
- Hotels ....................................................... 18,189 16,023 19,865
- Residences ................................................... 60,341 38,143 20,307
- Commercial spaces ............................................ 52,267 109,551 198,887
- Transportation ................................................ 94,599 102,902 111,686
Healthcare ......................................................... 113,452 148,245 199,180
Notes:
(1) Daily Life products are applied across a wide range of industries, such as home appliances, office and education sectors. It is
impracticable to breakdown such segment by industry.
(2) Technology services refer to services provided to enterprises across a wide range of industries, helping them enhance their R&D and
management efficiency based on our AI technologies. Such solutions are inherently applicable across various industries, and are not
designed to be industry-specific. As such, it is impracticable to breakdown such segment by industry.
Year ended December 31,
2022 2023 2024
Existing
Customers(1)
New
Customers
Existing
Customers(1)
New
Customers
Existing
Customers(1)
New
Customers
(RMB in thousands)
Daily Life(2) ..................... 279,819 206,863 360,376 218,353 524,537 215,293
- Products(3) ..................... 55,539 37,946 96,342 7,157 103,729 13,567
- Solutions
- Technology services (4) ........ 95,860 71,941 90,209 118,402 118,552 153,237
- Hotels .................... 13,204 4,985 4,321 11,702 6,907 12,958
- Residences ................. 54,785 5,556 24,037 14,106 12,582 7,725
- Commercial spaces .......... 24,666 27,601 43,934 65,617 98,471 100,416
- Transportation .............. 29,592 65,007 60,053 42,849 79,357 32,329
Healthcare ...................... 35,944 77,509 39,795 108,451 30,014 169,166
Notes:
(1) Existing customers refer to customers from whom we had revenue both in the previous year and the current year.
(2) Under Daily Life, some customers may have multiple contracts with us within the same year. These contracts can be under different
segments and corresponding to different customer types. For example, a customer may purchase commercial space solution for the first
time and also procure technology services within the same year while having procured technology services in the same capacity in the
previous year. This customer would be counted as both a new customer under commercial space solution and an existing customer under
technology services within the same year. However, this customer would only be committed as an existing customer under Daily Life.
Thus, for revenue from Daily Life, revenue from this customer would be only recorded under revenue from existing customers, while
revenue from this customer would be recorded both under commercial space solutions as a new customer and under technology services
as an existing customer within the same year.
(3) Daily Life products are applied across a wide range of industries, such as home appliances, office and education sectors. It is
impracticable to breakdown such segment by industry.
(4) AI technology services refer to services provided to enterprises across a wide range of industries, helping them enhance their R&D and
management efficiency based on our AI technologies. Such solutions are inherently applicable across various industries, and are not
designed to be industry-specific. As such, it is impracticable to breakdown such segment by industry.
253


--- page 263 ---
BUSINESS
Year ended December 31,
2022 2023 2024
Revenue from existing
customers
Revenue from
new customers
Revenue from existing
customers
Revenue from
new customers
Revenue from existing
customers
Revenue from
new customers
System
integrators
/Agents
Enterprise
customers
System
integrators
/Agents
Enterprise
customer
System
integrators
/Agents
Enterprise
customer
System
integrators
/Agents
Enterprise
customer
System
integrators
/Agents
Enterprise
customer
System
integrators
/Agents
Enterprise
customer
(RMB in thousands)
Daily Life(2) ....... 118,839 160,980 99,457 107,406 133,754 226,622 97,350 121,003 307,059 217,478 99,566 115,727
- Products(3) ....... 5,388 50,151 2,040 35,906 5,981 90,361 138 7,019 2,719 101,009 4,241 9,326
- Solutions
- Technology
services(4) .... 15,646 80,214 16,574 55,367 13,457 76,416 33,422 85,316 61,950 56,602 61,866 91,371
- Hotels ....... 7 1 13,132 24 4,962 715 3,606 1,862 9,840 841 6,066 12,852 106
- Residences .... 33,125 21,661 5,533 22 5,395 18,642 8,726 5,380 5,649 6,933 1,153 6,572
- Commercial
spaces ....... 19,232 5,434 26,064 1,537 23,714 20,221 52,939 12,677 78,531 19,940 94,994 5,422
- Transportation . 29,592 — 65,007 — 60,053 — 24,703 18,146 68,806 10,550 13,023 19,306
Healthcare(5) ....... 24,207 23,506 41,433 24,306 25,532 12,003 80,831 29,879 21,974 6,622 88,354 82,230
Notes:
(1) Existing customers refer to customers from whom we had revenue both in the previous year and the current year.
(2) Under Daily Life, some customers may have multiple contracts with us within the same year. These contracts can be under different
segments and corresponding to different customer types. For example, a customer may purchase commercial space solution as a system
integrator/agent for the first time and also procure technology services as an enterprise customer within the same year while having
procured technology services in the same capacity in the previous year. This customer would be counted as both a system integrator/
agent and a new customer under commercial space solution, and an enterprise customer and an existing customer under technology
services within the same year. However, this customer would be counted as an existing system integrator/agent and an existing enterprise
customer respectively under Daily Life in the same year. Thus, for revenue from Daily Life, revenue from this customer would be
recorded only under revenue from existing customers but under both enterprise customer and system integrators/agents, while in the
same year, revenue from this customer would be recorded both under commercial space solutions as a system integrator/agent and a new
customer, and under technology services as an enterprise customer and an existing customer.
(3) Daily Life products are applied across a wide range of industries, such as home appliances, office and education sectors. It is
impracticable to breakdown such segment by industry.
(4) Technology services refer to services provided to enterprises across a wide range of industries, helping them enhance their R&D and
management efficiency based on our AI technologies. Such solutions are inherently applicable across various industries, and are not
designed to be industry-specific. As such, it is impracticable to breakdown such segment by industry.
(5) Under Healthcare, revenue from system integrators/agents represents revenue from solutions provided to end users through contracts
with system integrators/agents; revenue from enterprise customers represents revenue from solutions provided to enterprise customers
through contracts directly with them. See the breakdown of the number of customers by customer type and industry above.
Under Daily Life, the number of system integrator/agent customers and revenue from them are
both less than those of the enterprise customers throughout the Track Record Period. Under Healthcare,
during the same period, the number of system integrator/agent customers and revenue from them are
greater than those of the enterprise customers in each year. Such difference primarily results from the
industry nature of our various customers. For example, despite the above described customer type
pattern under Daily Life, specifically in the transportation industry, we have more collaborations with
system integrators/agents than with enterprise customers, primarily because transportation end users,
such as local railway groups, usually have already developed multiple system integrators/agents
serving their needs during their transportation infrastructure construction history. Such system
integrators helped develop the transportation system, and are typically responsible for the daily
operation and maintenance of the transportation systems. Therefore, it usually is a commercial decision
that the system integrators/agents enter into the intelligent upgrades contracts with us to ensure the
stability in providing public services and a smooth upgrading process.
(III) Cost control by enhancing economies of scale and operational efficiency
Since our inception, we have actively engaged in advancing AI technologies and driving
innovation within the industry. In the highly competitive AI industry, substantial investments in R&D
254


--- page 264 ---
BUSINESS
are a prerequisite for driving innovation and technological advancement, and are commonly seen
across the industry, according to Frost & Sullivan. Despite operating at a loss primarily due to the
significant amount of R&D costs, we believe that our strategic investment in the improvement of AI
technologies will position us favorably in the competitive AI landscape and contribute to our long-term
success. Our commitment to R&D has already demonstrated promising results, with our revenue
increasing consistently during the Track Record Period. This growth is a direct result of our strong
technology capabilities, which we anticipate will continue to yield long-term benefits. With our
increased R&D efficiency and the expanding scale of operation, we also expect to benefit from the
economies of scale.
During the Track Record Period, we incurred significant R&D expenses, which were mainly
used in:
(i) the construction of the Atlas AI Infrastructure and the development of UniBrain,
which are the foundation for our development, optimization and commercialization of
cutting-edge models. Continuous R&D investments are essential to effectively
enhance computing power, optimize algorithms and improve data storage
capabilities. Such expenses mainly include employee salary expenses, server costs
and cloud-based fees, fixed asset depreciation expenses and third-party service fees.
During the Track Record Period, we significantly improved the computing power of
the intelligent computing cluster and the training platform of the data center. The data
storage volume and the scale and efficiency of data processing were also substantially
improved. As our algorithm continues to evolve, in May 2023, UniGPT, our
proprietary large language model, was launched as the new core of UniBrain,
significantly improving human-computer interaction capabilities and decision support
capabilities. UniGPT will incur new R&D needs in the coming years, mainly
including R&D employee salary expenses, server costs and cloud-based and
depreciation expenses, among others. We continue to develop AI components
including multimodal perception and generation methods, the industry-scale
knowledge graphs and the one-stop IoT interconnection system according to actual
business needs. The related R&D expenses mainly include employee benefit
expenses, server costs and cloud-based service fees.
(ii) the R&D of products and solutions for AI application scenarios. In terms of
application scenarios, we develop AI products and solutions for multiple scenarios
supported by UniBrain, and continuously iterate and upgrade to better serve hundreds
of enterprises and institutions in various fields such as home appliances, residences,
hotels, commercial spaces, transportation and healthcare. The R&D investment in this
part mainly includes employee benefit expenses and third-party service fees. To
improve R&D efficiency and allow our R&D staff to focus on the development of
core AI models and technologies, we outsourced certain non-essential R&D tasks to
third-party contractors, which typically include development of support modules for
UniBrain, data annotation, testing and packaging. As a result, we incurred a
significant amount of third-party service fees which contributed to a substantial part
of our R&D expenses. For Daily Life solutions, we mainly outsourced software
development work related to specific application scenarios, such as user interface
design and application software development. For Healthcare solutions, we usually
outsourced the development of management and application platforms for different
255


--- page 265 ---
BUSINESS
scenarios based on our proprietary knowledge graph. Additionally, we engage third-
party service providers to annotate the vast amount of data we use to train our models
and improve our technologies. The increase in third-party service fees for both
software development and data processing services in 2022 was primarily because we
expanded our AI solution offerings in a wider range of industry verticals, which
required an increase in the non-essential development work relating to interface and
application software as well as growing need for data to train new models. Benefiting
from such investments, we had a decrease in third-party service fees in 2023 by
continuing to use these application software and models. In 2024, we recorded an
increase in the third party service fees for developing application software across new
scenarios and upgrading existing products, being non-core R&D technology, as well
as an increase in the server costs and cloud-based service fees due to increased needs
for computing services. See “Financial Information — Description of Major
Components of Our Results of Operations — Research and Development Expenses.”
Our advanced AI technology and robust infrastructure, particularly with the launch of the
UniGPT Model in 2023, has been significantly accelerating our R&D process. This includes
automating routine tasks and reducing the cost and time required to train AI models compared with
traditional training methods, which enable us to reduce the data volume and human resources needed
for model fine-tuning when developing new solutions, thereby enhancing our R&D efficiency.
Improved R&D efficiency will further allow us to deploy more AI applications across various
scenarios and reach a broader customer base with the same level of resources. See “—UniBrain —
UniGPT.” As the launch of UniGPT was relatively recent, the financial benefits of the increased
research and development efficiency have not yet been recognized prominently in our financial
performance. While our research and development expenses remained relatively stable at RMB287.1
million in 2022 and RMB286.3 million in 2023 and increased to RMB370.1 in 2024, our research and
development expenses as a percentage of total revenue decreased from 47.8% in 2022 to 39.4% in
2023 and remained stable at 39.4,% in 2024. We had an increase in the absolute amount of R&D
expenses in 2024 largely because we made strategic, forward-looking investment to enhance the
infrastructure UniGPT and to explore a wider range of potential commercial application of it, eyeing
the significant increase in market demands in late 2024 and 2025. In particular, we focused our efforts
in modularizing our R&D and technologies, further increasing the level of low-code/zero-code
development and enhancing efficiency.
Such strategic investment has proven to be effective and helped us rapidly grew our revenue in
2024, and is expected to strengthen our technological edge and benefit our long-term success
especially given that we are able to reuse or swiftly repurpose a substantial extent of existing R&D and
technologies. It is also notable that despite such forward-looking investments, our R&D expenses as a
percentage of our revenue remained stable from 2023 to 2024 at 39.8%, indicating the efficiency of our
R&D activities. In addition, we plan to allocate human resources and fixed asset investment reasonably
according to the technical and product development plan and pace. We will also continue to optimize
the process of daily expenditure procurement, including comparing, selecting and negotiating with
suppliers and procurement channels to obtain better cost-effectiveness for products and services.
During the Track Record Period, in line with our revenue growth, the absolute amount of our
total operating expenses increased. Our operating expenses increased by 3.5% from RMB439.2 million
in 2022 to RMB454.6 million in 2023, primarily due to the increase in selling and marketing and
256


--- page 266 ---
BUSINESS
administrative expenses, which were primarily attributable to an increase in sales and marketing
activities to support our expanding business operations and an increase in listing expenses. Our
operating expenses further increased by 21.0% from RMB454.6 million in 2023 to RMB550.2 million
in 2024, primarily due to an increase in research and development expenses for developing application
software across new scenarios and upgrading existing products, as well as to support increased needs
for computing services.
However, we have seen significant economies of scale and operating leverage as we grow our
business. Our total operating expenses as a percentage of revenue decreased from 73.1% in 2022 to
62.5% in 2023 and further decreased to 58.6% in 2024.
Š During the Track Record Period, as our brand recognition continued to grow, the selling and
marketing expenses as a percentage of our total revenue remained relatively stable at 7.7% in
2022 and at 8.1% in 2023 and 7.5% in 2024, while our revenue experienced a robust growth.
Our ability to deliver commercial value to lighthouse customers and major customers earned
us growing reputation, leading to word-of-mouth effect which aided our sales effort. As the
performance improvement brought by UniGPT makes our products and services more
competitive, and, combined with our customer strategy, we expect our AI technology products
and solutions to gain increasing recognition for their ability to empower industries and help
improve quality and efficiency. As our customer base becomes more extensive, we have also
adopted localized sales and marketing strategy, deploying local teams serving major
customers. This helps us not only reduce travel costs, but also build stronger long-term
relationship with customers. Based on the above factors, we expect that, as indicated in 2024,
our revenue growth will continue to outpace the growth in selling and marketing expenses in
coming years.
Š Similarly, we have observed economies of scale in our administrative expenses. This is a
result of our continued effort in enhancing the efficiency of administrative management
and staffing.
In addition, we aim to increase our working capital and improve our cash flow by enhancing
our management of trade receivables. Our trade receivables turnover days remained relatively high at
254 days in 2022, 283 days in 2023 and 277 days in 2024, primarily because (i) during the Track
Record Period, we had been continuously expanding our business in the public sectors such as
transportation and healthcare, the customers of which, mainly including government departments,
public institutions and state-owned enterprises, typically have a longer payment cycle in accordance
with their internal financial management and payment approval processes. We believe that our
expansion in the public sector aligns with our long-term growth objectives, and has the potential to
deliver value by broadening the application of our offerings to meet the diverse needs of the public in
multiple facets of daily life; and (ii) certain of our private sector customers were in the process of
improving their overall liquidity condition during a slow post-pandemic recovery in 2022 and 2023.
The turnover days for private sector customers significantly decreased in 2024, attributable to our
enhanced collection efforts. See “Financial Information — Discussion of Certain Key Balance Sheet
Items — Current Assets and Liabilities — Trade Receivables”, We have been diversifying our
customer profile and aim to continuously improve the collection of trade receivables and the turnover
days by strengthening the communication with customers, actively collecting and negotiating feasible
repayment plans based on actual conditions.
257


--- page 267 ---
BUSINESS
PROPERTIES
Our corporate headquarter is located at Beijing, China. As of December 31, 2024, we did not
have any self-owned property, and leased 15 properties in the PRC. Our leased properties are primarily
used for corporate administration, research and development, office and employee residential purposes.
As of the Latest Practicable Date, none of the properties leased by us had a carrying amount of
15% or more of our consolidated total assets. According to Chapter 5 of the Hong Kong Listing Rules
and section 6(2) of the Companies Ordinance (Exemption of Companies and Prospectuses from
Compliance with Provisions) Notice, this prospectus is exempt from the requirements of section
342(1)(b) of the Companies (Winding up and Miscellaneous Provisions) Ordinance to include all
interests in land or buildings in a valuation report.
LICENSES, APPROVALS AND PERMITS
As of the Latest Practicable Date, as advised by our PRC Legal Advisors, we had obtained all
material licenses and permits required for our business operations in the PRC, and such business
licenses had remained in full effect. Our PRC Legal Advisors have advised us that there is no material
legal impediment to renewing such licenses provided that we comply with the relevant legal
requirements and submit the relevant applications in accordance with the requirements and schedule
prescribed by the applicable PRC laws and regulations.
LEGAL PROCEEDINGS AND COMPLIANCE
Legal Proceedings
From time to time, we have been and will 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 Industry and Business — We may from time to time be subject to claims, disputes,
lawsuits and other legal and administrative proceedings.”
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 complied with
the applicable laws and regulations in relation to our business in all material respects and were not
involved in any non-compliance incidents which the Directors believe would, individually, or in
aggregate, have a material adverse effect on our business as a whole. During the Track Record Period,
we had not been subject to any material penalty or investigation in relation to our business operations.
RISK MANAGEMENT AND INTERNAL CONTROL
We have committed ourselves to establishing and maintaining robust risk management and
internal control systems, comprising of tailored policies and procedures that align with our operational
258


--- page 268 ---
BUSINESS
dynamics. We conduct regular reviews of our risk management strategies and their execution to verify
their effectiveness and adequacy. A thorough risk management framework has been adopted and
implemented across our business spectrum, encompassing the following major aspects, among others.
Information System
Integrity of our information system are paramount to our operations. We have established
robust internal protocols and controls to safeguard our IT infrastructure, protect our data, and prevent
potential leaks or losses. During the Track Record Period, and up to the Latest Practicable Date, we
have not experienced any material system failures or data breaches.
Our data is protected by an established information system security management framework.
This comprehensive system incorporates network and data security measures, anti-virus protocols,
approval processes for system changes, and a rigorous approach to data backup and archiving. Our
centralized data center conducts regular backups to multiple secure systems to reduce the risk of data
loss. Our backup storage medium is renewed every three months to ensure stable performance. To
further ensure data integrity, we conduct regular backup recovery tests and utilize measures such as
routine system checks, high security standard password policies, access control systems, and regular
data recovery tests. We review our backup policies and procedures on an annual basis.
Our IT operation and maintenance department oversees the preservation of our IT systems and
infrastructure, ensuring that data usage, storage, and protection comply with our internal rules and all
relevant laws and regulations. We continually provide information security training to our staff, and
have implemented an emergency response mechanism to evaluate critical risks, devise disaster
response plans, and regularly perform emergency drills. Our commitment to ongoing risk management
ensures the security of our operations and the protection of users’ data.
Compliance Measures
Compliance risk signifies the potential for legal, regulatory sanctions, significant financial loss,
and reputational damage arising from our failure to adhere to relevant laws, regulations, rules, and
guidelines. We have designed and implemented a robust compliance risk management framework
within the confines of our comprehensive risk management system. The aim is to effectively pinpoint
and manage compliance risks and ensure that our operations adhere to applicable laws and regulations.
We have incorporated detailed anti-bribery compliance risk control measures into our
regulatory compliance management system. These measures encompass the identification, evaluation,
monitoring, and reporting of bribery. We also deliver periodic anti-bribery compliance training to our
employees.
Our business code of conduct explicitly prohibits all forms of commercial bribery, including
cash, in-kind, service provision, price concessions, or discounts during business activities. It also
restricts the acceptance or offering of gifts, dining, entertainment, travel, shopping, and other forms of
customer gratification that go beyond standard business courtesies in business dealings.
In addition, we have established an anti-bribery reporting hotline, where any reports received
must be forwarded to an independent department for subsequent investigation.
259


--- page 269 ---
BUSINESS
Financial Reporting
To manage financial reporting risks, we have implemented a set of accounting policies,
including financial report management, budget management, financial statement preparation, and
financial department and staff management. We have established specific procedures to enact these
accounting policies, with our financial department routinely reviewing management accounts
according to these procedures. We further ensure our financial department employees undergo regular
training to enhance their understanding of our financial management and accounting policies,
encouraging their effective implementation in daily operations.
Audit Committee Experience and Qualification and Board Oversight
Our audit committee continuously oversees the implementation of our risk management
policies to ensure our internal control system is adept at handling business risks. Our internal audit
department, integral to this process, reviews control effectiveness, reports issues to the audit
committee, and aids in implementing resolution strategies. Critical matters are timely forwarded to the
committee, and if necessary, reported to the board of directors. See “Directors, Supervisors and Senior
Management — Board Committees — Audit Committee.”
AWARDS AND RECOGNITIONS
Since inception and up to the Latest Practicable Date, we had received awards and recognition
in respect of our products, technology and innovation, significant ones of which are set forth below:
Š Contractor of “Scientific and Technological Innovation 2030 – Major Project of The Next
Generation of Artificial Intelligence” (Ҧ௴อ2030—“ อɓ˾ɛʈ౽ঐ”ɽධͦ) for
the years of 2018, 2020 and 2021, the national key R&D program organized by the
Ministry of Science and Technology of the People’s Republic of China;
Š 2019 Wu Wenjun Artificial Intelligence Science and Technology Progress Award (
ڲ
ኪҦஔආӉᆤ);
Š 2019 Beijing Science and Technology Progress Award, First Prize (ኪҦஔආӉᆤ
ɓഃᆤ);
Š Champion of the “Medical Named Entity Recognition Evaluation Task for Chinese
Electronic Medical Records” (ᔼᐕնΤྼ᜗ᗆй൙಻΂ਕ) at 2020
National Knowledge Graph and Semantic Computing Conference (ࠇ
ၑɽึ(CCKS)), and won the only technical innovation award;
Š China Health Information Processing Award for the years of 2019 and 2020 (CHIP ( ਄ੰ
ஈଣɽึ);
Š Several indicators for Mandarin and Shanghainese in the Blizzard Challenge 2020
International Speech Synthesis Competition(Υϓɽᒄ), first place;
Š Deep Noise Suppression (DNS) /Acoustic Echo Cancelation (AEC) Challenge at
INTERSPEECH 2021, second place;
Š Acronym Extraction and Acronym Disambiguation tasks at 2022 Association for the
Advancement of Artificial Intelligence (AAAI) conference, first place;
Š 2022 Chinese Biomedical Language Understanding Evaluation (CBLUE) Championship;
260


--- page 270 ---
BUSINESS
Š First top ten demonstration applications of AI industry large-scale models in Beijing in
June 2023;
Š Model partner in the second batch of the Beijing AGI Industry Innovation Partnership
Program in July 2023;
Š Track 1 (Fully Supervised Speaker Verification (Closed)) and ranked second in Track 2
(Fully supervised speaker verification (Open)) at the VoxCeleb Speaker Recognition
Challenge (VoxSRC) in August 2023, first place;
Š July 2023 CCKS 2023 — PromptCBLUE (Chinese Medical General Large Language
Model Evaluation) Championship;
Š Science and Technology Progress Award for Key Technologies and Applications of
Multimodal Intelligent Analysis and Chips in Edge Scenarios by the Fujian Provincial
People’s Government in April 2024, first place;
Š April 2024 MedBench Evaluation, first place;
Š June 2024 MedBench Evaluation, first place for our UniGPT;
Š Global top tier large language model in the 2024 SuperCLUE Semi-Annual Report;
Š 2024 National Smart Healthcare Competition, First Prize;
Š 2023 Beijing Top 100 Private Enterprises for Technological Innovation in September
2023;
Š 2023 National Intellectual Property Advantage Enterprise in November 2023;
Š 2024 Beijing Top 100 Private Enterprises for Technological Innovation;
Š 2024 Top 50 Large Model Enterprises;
Š Outstanding Expert Workstation in November 2024 for UniSound (Shanghai) AI
Technology Co., Ltd.; and
Š Official approval and license for Unisound Postdoctoral Research Workstation in
November 2024.
261


--- page 271 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
OVERVIEW
Our Board of Directors consists of 15 Directors, including six executive Directors, four
non-executive Directors and five 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)
Time of
joining our
Group
Date of
appointment
as a
Director Roles and responsibilities
Relationship
with other
Directors,
Supervisors
and senior
management
Executive Directors
Dr. Liang Jia’en
(ࢸ࢕.....)
48 Co-founder, Chairman of
our Board, executive
Director, deputy general
manager and chief
technology officer
May 2012 June 10,
2019
Ensuring the Board’s
effective performance of
its function, formulating
the business strategies,
making major corporate
and operational decisions,
and responsible for the
overall management of
our Group
None
Dr. Huang Wei
(
රਃ).......
48 Co-founder, executive
Director, chief executive
officer and general
manager
June 2012 June 10,
2019
Assisting the Chairman in
formulating business
strategies and making
major corporate and
operational decisions of
the Company and
ensuring the Board’s
effective performance of
its function
None
Dr. Kang Heng
(
ੰ㛬).......
46 Co-founder, executive
Director and vice
president of IoT
department
March
2012
June 10,
2019
Assisting the Chairman in
formulating business
strategies and making
major corporate and
operational decisions of
the Company and
ensuring the Board’s
effective performance of
its function
None
Mr. Li Xiaohan
(
ҽቢఫ) .....
46 Executive Director and
senior vice president of
R&D department
June 2015 June 10,
2019
Assisting the Chairman in
formulating business
strategies and making
major corporate and
operational decisions of
the Company and
ensuring the Board’s
effective performance of
its function
None
262


--- page 272 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
,Name Age Position(s)
Time of
joining our
Group
Date of
appointment
as a
Director Roles and responsibilities
Relationship
with other
Directors,
Supervisors
and senior
management
Mr. Liu
Shengping (ᄎ
ʺ̻) .......
47 Executive Director and
senior R&D director
December
2012
June 10,
2019
Assisting the Chairman in
formulating business
strategies and making
major corporate and
operational decisions of
the Company and
ensuring the Board’s
effective performance of
its function
None
Mr. Li Peng
(
ҽᘄ).......
43 Executive Director and
R&D director
July 2012 June 10,
2019
Assisting the Chairman in
formulating business
strategies and making
major corporate and
operational decisions of
the Company and
ensuring the Board’s
effective performance of
its function
None
Non-executive Directors
Mr. Duane
Kuang
(
⿼ɿ̻) .....
61 Non-executive Director June 2019 June 10,
2019
Providing professional
opinion and judgment to
the Board
None
Mr. Li Zhichao
(
ҽқ൴) .....
43 Non-executive Director June 2019 June 10,
2019
Providing professional
opinion and judgment to
the Board
None
Mr. Wang Cunfu
(
ӓπబ) .....
44 Non-executive Director April 2023 April 12,
2023
Providing professional
opinion and judgment to
the Board
None
Mr. Li Ang
(
׻.......)
37 Non-executive Director March
2025
March 12,
2025
Providing professional
opinion and judgment to
the Board
None
Independent Non-executive Directors
Mr. Hu Jianjun
(
ࠏܔߡ.....)
48 Independent
Non-executive Director
June 2019 June 10,
2019
Providing independent
opinion and judgment to
the Board
None
Mr. Fan Jian (
ᅾ
਄) .........
42 Independent
Non-executive Director
June 2019 June 10,
2019
Providing independent
opinion and judgment to
the Board
None
Ms. Jin Huihua
(
ᅆശ) .....
55 Independent
Non-executive Director
June 2023 June 23,
2023
Providing independent
opinion and judgment to
the Board
None
Dr. Zhang Kun
(
ੵտ).......
44 Independent
Non-executive Director
June 2023 June 23,
2023
Providing independent
opinion and judgment to
the Board
None
Mr. Chen Hua
(
௓ശ).......
46 Independent
Non-executive Director
June 2023 June 23,
2023
Providing independent
opinion and judgment to
the Board
None
263


--- page 273 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Our Supervisory Committee comprises three members. Our Supervisors serve a term of three
years and may be re-elected for successive reappointments. The functions and duties of the
Supervisory Committee include reviewing financial reports, business reports and profit distribution
plans prepared by the Board and overseeing the financial and business performance of our Group.
The following table sets out information in respect of the Supervisors.
Name Age Position(s)
Time of joining
our Group
Date of
appointment as
a Supervisor
Roles and
responsibilities
Relationship
with other
Directors,
Supervisors
and senior
management
Mr. Shan Bo (ت3 9 Employee
representative
Supervisor
and Chairman
of the
Supervisory
Committee
December 2012 June 10, 2019 Overseeing
the operations
and financial
activities of
the Group
None
Mr. Ren He (
΂ͫ)...... 4 7 Supervisor August 2012 June 10, 2019 Overseeing
the operations
and financial
activities of
the Group
None
Mr. Hong Zhao (
Ί) . . . 33 Supervisor June 2019 June 10, 2019 Overseeing
the operations
and financial
activities of
the Group
None
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
Time of
joining our
Group
Date of
appointment
as a senior
management
Roles and
responsibilities
Relationship
with other
Directors,
Supervisors
and senior
management
Dr. Liang Jia’en
(ࢸ࢕............)
48 Co-founder,
Chairman of our
Board, executive
Director, deputy
general manager
and chief
technology officer
May
2012
June 10,
2019
Ensuring the
Board’s effective
performance of its
function,
formulating the
business strategies,
making major
corporate and
operational
decisions, and
responsible for the
overall
management of
our Group
None
264


--- page 274 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Name Age Position
Time of
joining our
Group
Date of
appointment
as a senior
management
Roles and
responsibilities
Relationship
with other
Directors,
Supervisors
and senior
management
Dr. Huang Wei ( රਃ) . . . 48 Co-founder,
executive
Director, chief
executive officer
and general
manager
June 2012 June 10,
2019
Assisting the
Chairman in
formulating
business strategies
and making major
corporate and
operational
decisions of the
Company and
ensuring the
Board’s effective
performance of
its function
None
Dr. Kang Heng (
ੰ㛬) . . . 46 Co-founder,
Executive Director
and vice president
of IoT department
March
2012
June 10,
2019
Assisting the
Chairman in
formulating
business strategies
and making major
corporate and
operational
decisions of the
Company and
ensuring the
Board’s effective
performance of
its function
None
Mr. Li Xiaohan
(
ҽቢఫ) ............
46 Executive Director
and senior vice
president of R&D
department
June 2015 June 10,
2019
Assisting the
Chairman in
formulating
business strategies
and making major
corporate and
operational
decisions of the
Company and
ensuring the
Board’s effective
performance of
its function
None
Mr. Liu Shengping (
ᄎʺ
̻) ................
47 Executive Director
and senior R&D
director
December
2012
June 10,
2019
Assisting the
Chairman in
formulating
business strategies
and making major
corporate and
operational
decisions of the
Company and
None
265


--- page 275 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Name Age Position
Time of
joining our
Group
Date of
appointment
as a senior
management
Roles and
responsibilities
Relationship
with other
Directors,
Supervisors
and senior
management
ensuring the
Board’s effective
performance of its
function
Mr. Li Peng (
ҽᘄ) ..... 4 3 Executive Director
and R&D director
July
2012
June 10,
2019
Assisting the
Chairman in
formulating
business strategies
and making major
corporate and
operational
decisions of the
Company and
ensuring the
Board’s effective
performance of its
function
None
Ms. Li Na (
ࢆ4 3 Chief financial
officer
July
2015
June 10,
2019
Overall financial
planning and
management of
our Group
None
DIRECTORS
Executive Directors
Dr. Liang Jia’en (ࢸ࢕)aged 48, is our co-founder, Chairman of our Board, executive
Director, deputy general manager and chief technology officer.
Prior to founding our Group, Dr. Liang worked in the Institute of Automation Chinese
Academy of Science (הfrom July 2006 to February 2011, where he was
primarily responsible for the R&D, optimization and application of speech recognition technologies,
including key word detection technologies, large-scale consecutive speech recognition, and objective
standard-based automatic oral evaluation system which was applied in high school entrance exams of
Jiangsu and Wenzhou. Mr. Liang was qualified as a senior engineer (
ࢪin October 2024.
Dr. Liang obtained his bachelor’s degrees in automatic control from University of Science and
Technology of China (ኪҦஔɽኪ) in Anhui, PRC in July 2001, and his Ph. D. in pattern
recognition and intelligent system from Institute of Automation Chinese Academy of Science (߅
הin Beijing, PRC in July 2006.
Dr. Huang Wei ( රਃ), aged 48, is our co-founder, executive Director, chief executive officer
and general manager.
Dr. Huang worked in Motorola China Research Center (Ӻʕː) from
September 2006 to July 2009, where he was primarily responsible for the development of voice and
speech recognition technologies. Dr. Huang served as a director in Shanghai Yinlong Information
Technology Co., Ltd. (
ʮ̡) from August 2012 to November 2015.
Dr. Huang obtained his doctor’s degree in signal and information processing from University of
Science and Technology of China (ኪҦஔɽኪ) in Anhui, PRC in June 2004, and engaged in
266


--- page 276 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
postdoctoral research of biomedical engineering in Shanghai Jiao Tong University ( ɪऎʹஷɽኪ)i n
Shanghai, PRC from July 2004 to June 2006.
Dr. Huang was a supervisor of Changzhou Chaoxun Information Technology Co., Ltd. ( ੬ψ൴
ʮ̡)( “ Changzhou Chaoxun ”) and was not involved in the daily operations of
Changzhou Chaoxun. In July 2021, due to Changzhou Chaoxun’s cessation of business, Dr. Huang
submitted a liquidation application to dissolve Changzhou Chaoxun. As of the Latest Practicable Date,
Changzhou Chaoxun has been deregistered.
Dr. Kang Heng (
ੰ㛬), aged 46, is an executive Director and our vice president of IoT
department.
Before joining our Group, Dr. Kang successively served as a researcher in Canon Information
Technology (Beijing) Co., Ltd. (Ҧஔ(̏ԯ)ʮ̡) from April 2007 to August 2011, where
he was primarily responsible for the R&D of multilingual speech synthesis technology and multi-
model interaction technology.
Dr. Kang obtained his bachelor’s degree in mechanical engineering from Tsinghua University
(
૶ശɽኪ) in Beijing, PRC in July 2000. He obtained his doctor’s degree in pattern recognition and
intelligent system from Institute of Automation Chinese Academy of Science (Ӻ
הin Beijing, PRC in January 2007.
Mr. Li Xiaohan ( ҽቢఫ), aged 46, is an executive Director and our senior vice president of
R&D department. Mr. Li joined our Group as the chief process officer of our subsidiary in October
2014.
Before joining our Group, Mr. Li worked as a technology manager of Motorola Mobile
Communication Technology Co., Ltd. (
ʮ̡) (formerly known as Lenovo
Mobile Telecommunication Co., Ltd. (ப΂ʮ̡)) from July 2003 to September 2005,
where he was primarily responsible for R&D of embedded application. He also worked in Motorola
China Research Center from September 2005 to July 2009, where he was primarily responsible for the
development of AI technology on embedded application.
Mr. Li obtained his bachelor’s degree in electronic engineering and his doctor’s degree in
signal and information system from University of Science and Technology of China (
ኪҦஔɽ
ኪ) in Anhui, PRC in July 1998 and July 2003, respectively.
Mr. Liu Shengping ( ᄎʺ̻), aged 47, is an executive Director and our senior R&D director.
Before joining our Group, Mr. Liu worked as a research staff in IBM China Investment
Company Limited (IBM( ʕ਷)ʮ̡) from July 2005 to July 2011, where he was primarily
responsible for the R&D on application of semantic and knowledge graph technology.
Mr. Liu obtained his bachelor’s degree from Xi’an Jiaotong University ( Гτʹஷɽኪ)i n
Shaanxi, PRC in July 1999, and his doctor’s degree in applied mathematics from Peking University ( ̏
ԯɽኪ) in Beijing, PRC in July 2005.
267


--- page 277 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Mr. Li Peng ( ҽᘄ), aged 43, is an executive Director and our R&D director.
Before joining our Group, Mr. Li served as a researcher in Fujitsu R&D Center Co., Ltd. ( బɻ
ʮ̡) from July 2008 to November 2010, where he was primarily responsible for the
R&D of Chinese language speech recognition technology.
Mr. Li obtained his bachelor’s degree in automation from Tsinghua University ( ૶ശɽኪ)i n
Beijing, PRC in July 2002, and his doctor’s degree in pattern recognition and intelligent system from
Institute of Automation Chinese Academy of Science (
הin Beijing, PRC in
July 2008.
Non-executive Directors
Mr. Duane Kuang ( ⿼ɿ̻), aged 61, is a non-executive Director.
Mr. Kuang has held directorships in several entities of Qiming Venture Partners, including
serving as the chairman of Qiming Weichuang Venture Capital Management (Shanghai) Co., Ltd. ( 䥊
ʮ̡) since June 2006. Mr. Kuang also served as a director in
CooTek (Cayman) Inc., a company delisted from NYSE (stock code: CTK), from August 2012 to
December 2023.
Mr. Kuang obtained his bachelor’s degree in computer science from the California State
University, San Francisco in the United States in January 1986. He obtained his master’s degree of
computer science in Stanford University in the United States in March 1988, and his MBA from
University of California at Berkeley in the United States in December 1993.
Mr. Li Zhichao (
ҽқ൴), aged 43, is a non-executive Director.
Mr. Li served as a project manager in China Mobile Communications Group Tianjin Co., Ltd. (ʕ
ʮ̡) from July 2007 to March 2011, a researcher in Sinolink Securities (Hong
Kong) Company Limited (ᗇՎ(ಥ)ʮ̡) (formerly known as Guangdong Securities Limited
(ຽऎᗇՎ(ಥ)ʮ̡)) from March 2011 to March 2012, and joined Beijing Grains Valley Venture
Capital Co., Ltd. (ப΂ʮ̡) since March 2012 and is now serving as a partner.
Mr. Li obtained his bachelor’s degree in automation from Beijing University of Chemical
Technology ( ̏ԯʷʈɽኪ) in Beijing, the PRC in July 2004, and his master’s degree in business
management from Tsinghua University ( ૶ശɽኪ) in July 2007.
Mr. Wang Cunfu ( ӓπబ), aged 44, is a non-executive Director.
Mr. Wang worked in the Electronic Information Product Management Department of the
Ministry of Industry and Information Technology (MIIT) and the Software Service Department of
MIIT. He then worked in the autonomous driving division in charge of public affairs and strategic
cooperation in Baidu Online Network Technology (Beijing) Co., Ltd. (
ίᇞၣഖҦஔ(̏ԯ)ʮ
̡) (a company listed on NASDAQ, ticker: BIDU) from June 2016 to January 2018. Mr. Wang has
worked in China Internet Investment Fund Management Co., Ltd. (ʮ̡)
since February 2018, successively serving positions including the department general manager of the
investment research department and the investment department, and a director of Shanghai Longcheer
Technology Co., Ltd. (
ʮ̡), a company listed on the Shanghai Stock Exchange
(stock code: 603341) from January 2022 to January 2025.
268


--- page 278 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Mr. Wang obtained his bachelor’s degrees in computer science and technology from Liaoning
Petrochemical University (ʷʈɽኪ) in Liaoning, PRC in July 2002 and in management from
Nanjing University (ԯɽኪ) in Jiangsu, PRC in March 2006, respectively, his master’s degree in co
mputer application from Nanjing Tech University (ԯʈุɽኪ) in Jiangsu, PRC in June 2005, and
his doctor’s degree in industrial economics from the Graduate School of Chinese Academy of Social
Sciences (
Ӻ͛৫) in Beijing, PRC in July 2014.
Mr. Li Ang (׻)aged 38, is a non-executive Director.
Mr. Li worked in Hikvision from 2016 to 2017, and in Xiangyi Microchain ( ൥୤ฆᗡ) from
September 2017 to March 2020. He joined JD Group in April 2020 and currently serves as the head of
the IoT delivery department under the JD Cloud Division of JD Group.
There is clear business delineation between the IoT business of JD Group and the Group in
terms of application scenario, solution types and business model. To the best knowledge, information
and belief of the Directors, Mr. Li does not have any interests in any business, which competes or is
likely to compete, either directly or indirectly, with our business which would require disclosure under
Rule 8.10 of the Listing Rules.
Mr. Li obtained his bachelor’s degree in computer science and technology from Nanjing
University of Aeronautics and Astronautics (
ঘ˂ɽኪ) in Jiangsu, the PRC in June 2009, and
his master’s degree in computer software and theory from NCI in Beijing, the PRC in May 2012.
Independent non-executive Directors
Mr. Hu Jianjun (ࠏܔߡ)aged 48, is an independent non-executive Director.
Mr. Hu has served as the partner of Baker Tilly International (Special General Partnership
Accounting Firm) (ה(౷ஷΥྫ)) since March 2012, and currently serves as
the director of its Shanghai branch and Shanghai Pilot Free Trade Zone branch, and the chairman of its
IPO professional committee. He has served as a director of Jinko Power Technology Co., Ltd. (
ཥ
ʮ̡) (a company listed on the Shanghai Stock Exchange, stock code: 601778.SH)
since June 2017, an independent director of Ikd Co., Ltd. (ʮ̡) (a company listed on
the Shanghai Stock Exchange, stock code: 600933.SH) from August 2018 to September 2024, an
independent director of Maxwealth Fund Management Co., Ltd. (
ʮ̡) since
December 2019, and Nanjing Medlander Medical Technology Co., Ltd. (ʮ̡)
(a company listed on the STAR Market, stock code: 688273.SH) from September 2020 to September
2023.
Mr. Hu is a director of Shanghai Institute of Certified Public Accountants (
՘
ึ), and a member of the Chinese Institute of Certified Public Accountants (՘ึ), the
CPA Australia and the IPA Australia.
Mr. Hu obtained his bachelor’s degree in accounting from Hunan University (ɽኪ)i nH u
nan, PRC in December 2001, and his master’s degree in accounting from The Chinese University of
Hong Kong in December 2009 and master’s degree in business administration from China Europe
International Business School (
ʕᆄ਷ყʈਠኪ৫) in April 2018.
269


--- page 279 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Mr. Fan Jian ( ᅾ਄), aged 42, is an independent non-executive Director.
Mr. Fan Jian has served as an associate professor of the school of law in Shanghai University of
Finance and Economics ( ɪऎৌ຾ɽኪ) since January 2014, and a lawyer of Shanghai Lihui Law Firm
(הsince December 2022.
Mr. Fan served as an independent director of Xinling Electrical Co., Ltd. (ʮ
̡) (a company listed on the ChiNext, stock code: 301388.SZ) from August 2020 to March 2023, and
has served as an independent director of Shanghai Shangshi Aviation Engine Co., Ltd. (٤
ʮ̡) since November 2021, Shanghai Phoenix Enterprise (Group) Co., Ltd. ( ɪऎჾ਑
Άุ(΅)ʮ̡) (a company listed on the Shanghai Stock Exchange, stock code: 600679) since
February 2022, and Shanghai Tongling Automotive Technologies, Inc. (ʮ
̡) (a company listed on the National Equities Exchange and Quotations, stock code: 834081. NQ)
since August 2022.
Mr. Fan obtained his bachelor’s degree in law from Shanghai University of Finance and
Economics ( ɪऎৌ຾ɽኪ) in Shanghai, PRC in June 2006, his master’s degree in civil and
commercial law from China University of Political Science and Law in Beijing, PRC in June 2009, and
his doctor’s degrees in law from Tsinghua University (
૶ശɽኪ) in Beijing, PRC and Graduate School
of Law, Tohoku University (߅in July 2013 and September 2013,
respectively.
Ms. Jin Huihua (ᅆശ), aged 55, is an independent non-executive Director.
Ms. Jin worked in Pucheng People’s Court of Fujian Province (৫) in 1992.
Ms. Jin served as a lecturer from November 1998 to November 2001, an associate professor from
December 2004 to December 2007 and a professor from December 2009 to December 2012 of the
school of law of Shanghai Lixin University of Accounting and Finance (
ፄኪ৫). She
was a visiting scholar of Queen Mary University of London from November 2017 to November 2018.
Ms. Jin has served as a lawyer of Shulun & Partners (Shanghai) (
הsince October
2022. Ms. Jin is currently an arbitrator of Shanghai Arbitration Commission (ึ) and
Shanghai International Economic and Trade Arbitration Commission (ึ).
Ms. Jin obtained her bachelor’s degree in international economic law from the China University
of Political Science and Law (ɽኪ) in Beijing, PRC in July 1991, and her master and doctor’s
degree in law from East China University of Political Science and Law (ɽኪ) in Shanghai,
PRC in June 1996 and January 2007, respectively.
Dr. Zhang Kun ( ੵտ), aged 44, is an independent non-executive Director.
Dr. Zhang has an extensive background in academia and a wealth of experience in the field of
machine learning. Dr. Zhang, currently the Acting Chair and Professor in the Machine Learning
Department, and the director of the Center of Integrative AI at Mohamed bin Zayed University of
Artificial Intelligence since January 2022, also holds the position of Associate Professor in the
Department of Philosophy and affiliate faculty in the Machine Learning Department at Carnegie
Mellon University. Prior to that, he served as an Assistant Professor at Carnegie Mellon University
from August 2015. Mr. Zhang’s distinguished career includes roles Senior Researcher at the
Max-Planck Institute for Intelligent Systems in Tübingen, Germany. Additionally, he has contributed
significantly to the academic community as an Associate Editor for prestigious journals such as ACM
270


--- page 280 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Computing Surveys and Pattern Recognition, and a General and Program Chair of the 1st Conference
on Causal Learning and Reasoning (CleaR 2022) and a program chair of the 38th Conference on
Uncertainty in Artificial Intelligence (UAI 2022) showcasing his dedication to advancing the field.
Dr. Zhang obtained a bachelor’s degree in Automation from the University of Science and
Technology of China (
ኪҦஔɽኪ) in Anhui, PRC in July 2001, and a doctorate’s degree in
Computer Science from The Chinese University of Hong Kong (ಥʕ˖ɽኪ) in December 2005.
Mr. Chen Hua ( ௓ശ), aged 46, is an independent non-executive Director.
Mr. Chen has served as the chairman and chief executive officer of Changba (ᆀණྠ)
since March 2011.
Mr. Chen obtained his bachelor’s and master’s degree in computer from Peking University ( ̏
ԯɽኪ) in July 2001 and June 2004, respectively.
Confirmation from our Directors
Rule 8.10 of the Listing Rules
To the best knowledge, information and belief of the Directors having made all reasonable
inquiries, none of our Directors has any interests in any business, which competes or is likely to
compete, either directly or indirectly, with our 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; and (ii) understands his or her obligations as a director of a listed
issuer on the Stock Exchange under the Listing Rules.
Rule 3.13 of the Listing Rules
Each of the independent non-executive Directors confirms (i) his/her independence as regards
each of the factors referred to in Rules 3.13(1) to (8) of the Listing Rules; (ii) that 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.
SUPERVISORS
Mr. Shan Bo (
ت)aged 39, is an employee representative Supervisor and the chairman of
our Supervisory Committee.
Mr. Shan served as an algorithm R&D engineer in Alibaba Cloud Computing Co., Ltd. (Ԣˋ
ʮ̡).
Mr. Shan obtained his bachelor’s degree and master’s degree in computer science and
technology from Harbin Institute of Technology (ဧᏵʈุɽኪ) in Heilongjiang, PRC in July 2007
and July 2009, respectively.
271


--- page 281 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Mr. Ren He ( ΂ͫ), aged 47, is a shareholder representative Supervisor.
Mr. Ren served in Institute of Automation Chinese Academy of Science (Ӻ
הfrom July 2007 to August 2011.
Mr. Ren obtained his bachelor’s degree in electrical engineering and automation from China
University of Mining and Technology ( ʕ਷ᘤุɽኪ) in Jiangsu, PRC in June 2000, and his doctor’s
degree in computer application from Institute of Automation Chinese Academy of Science (ኪ৫
הin Beijing, PRC in July 2007.
Mr. Hong Zhao (Ί), aged 33, is a shareholder representative Supervisor.
Mr. Hong served as a director of China Financial Union Co., Ltd. (ʮ̡) from
August 2016 to January 2021, and manager of Zhongneng Rongtai Technology Co., Ltd. (߅
ʮ̡) from October 2017 to February 2019. He has served as the special assistant to the
chairman of 360 Security Technology Inc. (ʮ̡) since February 2019 and the
general manager of the strategy and investment center since October 2021.
Save as disclosed above, none of our Directors or Supervisors held any directorship in public
companies, the securities of which are listed on any securities market in Hong Kong or overseas in the
last three years immediately preceding the date of this document. Save as disclosed herein, to the best
knowledge, information and belief of the Directors and Supervisors having made all reasonable
inquiries, there are no other matters with respect to the appointment of the Directors and Supervisors
that need to be brought to the attention of our Shareholders and there is no information relating to our
Directors and Supervisors that is required to be disclosed pursuant to Rule 13.51(2)(a) to (v) of the
Listing Rules.
SENIOR MANAGEMENT
For biographical details of Dr. Liang Jia’en (
ࢸ࢕Dr. Huang Wei ( රਃ), Dr. Kang Heng ( ੰ
㛬), Mr. Li Xiaohan ( ҽቢఫ), Mr. Liu Shengping ( ᄎʺ̻) and Mr. Li Peng ( ҽᘄ), see “— Executive
Directors” in this section.
Ms. Li Na (ࢆ)aged 43, has been our chief financial officer since July 2015.
Prior to joining our Group, Ms. Li served in Taiping Life Insurance Co., Ltd. Foshan Branch
(ʮ̡Нʆʱʮ̡ ) from September 2008 to June 2010, in Foshan Huaxin
Packaging Co., Ltd. (ʮ̡ ) from June 2010 to February 2012, a financial
manager in Huawei Technology Co., Ltd. (ʮ̡) from March 2012 to January 2013, and
the deputy manager of financial department in Yangtze Three Gorges Equipment and Materials Co.,
Ltd. (
ʮ̡ ) from January 2013 to July 2015.
Ms. Li obtained her bachelor’s degree in accounting from Zhongnan University of Economics
and Law (ɽኪ) in Hubei, PRC in June 2003 and her master’s degree in professional
accounting from Sun Yat-sen University ( ʕʆɽኪ) in Guangdong, PRC in December 2008.
JOINT COMPANY SECRETARIES
Ms. Li Na (ࢆhas served as our Joint Company Secretary since June 2023. For biographical
details of Ms. Li, see “— Senior Management.”
272


--- page 282 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Ms. Wong Wai Yee, Ella ( රᅆՅ) is a Director of Corporate Services of Tricor Services
Limited, a global professional services provider specializing in integrated business, corporate and
investor services. Ms. Wong has over 20 years of experience in the corporate secretarial field and has
been providing professional corporate services to Hong Kong listed companies as well as
multinational, private and offshore companies. Ms. Wong is currently acting as the company secretary
or joint company secretary of a few listed companies on the Stock Exchange. Ms. Wong is a Chartered
Secretary, a Chartered Governance Professional and a Fellow of both The Hong Kong Chartered
Governance Institute (“HKCGI”) and The Chartered Governance Institute in the United Kingdom. Ms.
Wong is a holder of the Practitioner’s Endorsement from HKCGI. Ms. Wong obtained her bachelor’s
degree of Economics from The University of Hong Kong and a Postgraduate Diploma in Corporate
Administration from the City University of Hong Kong.
BOARD COMMITTEES
Our Board delegates certain responsibilities to various committees. In accordance with the
relevant PRC laws and regulations and the Corporate Governance Code, Appendix 14 to the Listing
Rules, our Company has formed three Board committees, namely the Audit Committee, the
Remuneration Committee and the Nomination Committee.
Audit Committee
We have established an Audit Committee with written terms of reference in compliance with
Rule 3.21 of the Listing Rules and paragraph D.3 of part II of the Corporate Governance Code,
Appendix 14 to the Listing Rules. The Audit Committee consists of three Directors, namely Mr. Hu
Jianjun, Ms. Jin Huihua and Mr. Fan Jian. Mr. Hu Jianjun holds the appropriate professional
qualifications as required under Rules 3.10(2) and 3.21 of the Listing Rules. Mr. Hu Jianjun serves as
the chairperson of the Audit Committee. The primary duties of the Audit Committee include, but not
limited to, the following:
Š examining the authenticity of financial reports of our Company and monitoring financial
reporting procedures of our Company;
Š examining the effectiveness of risk management and internal control system of our
Company;
Š ensuring that our Company’s resources in accounting, internal audit and financial
reporting functions, qualifications and experience of our Company’s accounting and
reporting personnel, and the training and budget for relevant expenditures are adequate;
Š reviewing results of internal investigations and responses from management in relation to
any suspected dishonesty, non-compliances, or suspected violations of laws, rules and
regulations;
Š evaluating whether our Company has any major internal control defaults or deficiencies;
Š evaluating the nature and severity of major risks faced by our Company in the preceding
financial year;
Š evaluating the performance of the audit function and personnel;
Š proposing the appointment of external auditors to our Board, and reviewing the
qualification, independence and performance of the external auditors; and
Š regularly examining the financial reports and annual reports of our Company.
273


--- page 283 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Remuneration Committee
We have established a Remuneration Committee with written terms of reference in compliance
with paragraph E.1 of part II of the Corporate Governance Code, Appendix 14 to the Listing Rules.
The Remuneration Committee consists of three Directors, namely Dr. Zhang Kun, Dr. Huang and
Mr. Fan Jian. Dr. Zhang Kun serves as the chairperson of the Remuneration Committee. The primary
duties of the Remuneration Committee include, but not limited to, the following:
Š formulating the overall remuneration policy and structure of our Company’s Directors,
Supervisors and members of the senior management, formulating proper and transparent
remuneration procedures, and making suggestions to our Board;
Š 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;
Š making recommendations to our Board on remuneration of individual executive Directors
and member of senior management, including non-monetary benefits, pension rights and
amount of compensation (including compensation for loss or termination of office or
appointment);
Š making recommendations to our Board on remuneration of our non-executive Directors
(including independent non-executive Directors), Supervisors, advisers to the Board (if
any) and committees of our Board;
Š reviewing and approving compensation payable to our executive Directors, Supervisors
and members of senior management for loss or termination of office or appointment, so as
to ensure that such compensation is consistent with the terms of relevant contracts, and if
such compensation is not determined in accordance with the relevant contract terms,
compensation should be fair, reasonable and not excessive;
Š reviewing and approving compensation arrangements in relation to dismissal or removal
of our Directors due to misconduct, so as to ensure that such compensation is consistent
with terms of relevant contract, and if such compensation is not determined in accordance
with the relevant contract terms, compensation should be fair, reasonable and not
excessive; and
Š dealing with other matters as required by laws, regulations, rules, articles of our Company,
terms of reference and applicable securities regulatory authorities, and other matters that
are authorized by the Board.
Nomination Committee
We have established a Nomination Committee with written terms of reference in compliance
with paragraph B.3 of part II of the Corporate Governance Code, Appendix 14 to the Listing Rules.
The Nomination Committee consists of three Directors, namely Mr. Chen Hua, Dr. Liang and Ms. Jin
Huihua. Mr. Chen Hua serves as the chairperson of the Nomination Committee. The primary duties of
the Nomination Committee include, but not limited to, the following:
Š reviewing the structure, composition and diversity of our Board at least once a year with
reference to our Company’s business activities, scale of assets and shareholding structure,
and making recommendations to our Board on any change in Board composition in
accordance with our Company’s strategies;
274


--- page 284 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Š making recommendations on the appointment and re-appointment of our Directors (in
particular, the chairperson of our Board, and including our non-executive Directors and
independent non-executive Directors) and our general manager;
Š conducting search in potential suitable candidates for Directors and making
recommendations to our Board on the suitable candidates;
Š evaluating the independence of our independent non-executive Directors, the performance
of our Directors (including both executive and non-executive Directors) and whether our
Directors have devoted sufficient time in performing their duties;
Š developing corporate governance standards and procedures and monitoring the
implementation of such standards and procedures, and making recommendations to our
Board;
Š monitoring and overseeing the trainings and continuous professional development plan for
our Directors and members of our senior management, and developing and overseeing the
compliance of code of conducts and compliance handbook (if any) for our employees and
Directors;
Š formulating and evaluating our Board diversity policy, and making disclosures in the
corporate governance report (which shall be included as part of our annual report) the
relevant policies, including the nomination procedures adopted by the nomination
committee and standards for the election of our Board members; and
Š dealing with other matters that are authorized by our Board or our Articles from time to
time, and other matters that are required by applicable laws from time to time.
COMPENSATION OF DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
We offer our executive Directors, Supervisors and senior management members, who are also
the Company’s employees, compensation in the form of wages, salaries, pension costs, housing
benefits and other benefits in kind. Our independent non-executive Directors receive compensation
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, the aggregate amount of remuneration
paid or payable to our Directors and supervisors amounted to RMB7.0 million, RMB7.6 million and
RMB8.7 million, respectively.
Under the arrangement currently in force, we estimate the total compensation before taxation,
including estimated-share based compensation, to be accrued to our Directors and our Supervisors for
the year ending December 31, 2025 to be approximately RMB8.7 million. The actual remuneration of
Directors and Supervisors in 2025 may be different from the expected remuneration.
For the years ended December 31, 2022, 2023 and 2024, there were two, one and three
Directors among the five highest paid individuals, respectively. The total emoluments for the
remaining individuals among the five highest paid individuals amounted to RMB3.5 million,
RMB4.4 million and RMB1.8 million for the years ended December 31, 2022, 2023 and 2024,
respectively.
We confirmed that during the Track Record Period, no consideration was paid by our Company
to, or receivable by, our Directors for making available directors’ services or as termination benefits.
275


--- page 285 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Save as disclosed above, no other payments have been paid, or are payable, by our Company or
any of our subsidiary to our Directors, Supervisors or the five highest paid individuals during the Track
Record Period.
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 14 to the Hong Kong 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 the 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, 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 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 engineering, economics, and business administration. We have
five 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.
SHARE INCENTIVE PLANS
For more information, please refer to “Appendix VI — Statutory and General Information —
D. Employee Incentive Schemes.”
COMPLIANCE ADVISOR
We have appointed Haitong International Capital Limited as our Compliance Advisor pursuant
to Rules 3A.19 and 19A.05 of the Listing Rules. The Compliance Advisor will provide us with
276


--- page 286 ---
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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, inclu
ding share issues and share repurchases;
(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 19A.06 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 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.
277


--- page 287 ---
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
Controlling Shareholders
As of the Latest Practicable Date, Dr. Liang, Dr. Huang and Dr. Kang, by virtue of the
acting-in-concert arrangement among them, were collectively interested in approximately 33.93% of
our total issued share capital, including (i) 3.78% of our total issued share capital directly held by
Dr. Liang, (ii) 24.08% and 3.80% of our total issued share capital controlled by Dr. Huang indirectly
through Yunsi Shangyi and Yunchuang Hudong, respectively, both of which have Tianjin Yunsheng
(which is held by Dr. Huang as to 99%) as their respective general partner, and (iii) 2.27% of our total
issued share capital directly held by Dr. Kang. See “History, Development and Corporate Structure —
The Controlling Shareholders” for details.
Immediately following the completion of the Global Offering (assuming the Over-allotment
Option is not exercised), Dr. Liang, Dr. Huang and Dr. Kang will, directly and indirectly through
Tianjin Yunsheng, Yunchuang Hudong and Yunsi Shangyi, continue to control in aggregate
approximately 33.18% of our total issued share capital. Therefore, they will remain as our Controlling
Shareholders upon Listing.
INDEPENDENCE FROM OUR CONTROLLING SHAREHOLDERS
Our Directors consider that we are capable of carrying on our business independently from the
Controlling Shareholders and their 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 the
Listing, our Board consists of 15 Directors, namely six executive Directors, four non-executive
Director and five independent non-executive Directors. Dr. Liang, Dr. Huang and Dr. Kang, who are
the Controlling Shareholders, as detailed above, are also the members of our Board. Dr. Liang serves
as our chairman of the Board and executive Director. Dr. Huang serves as our executive Director, chief
executive officer and general manager. Dr. Kang serves as our executive Director.
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 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, Supervisors and Senior Management” for details of the industry
experience of our senior management team;
(b) each Director is aware of his/her fiduciary duties as a director which require, among other
things, that he/she acts for the benefit and in the interest of our Company and does not
allow any conflict between his/her duties as 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;
278


--- page 288 ---
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
(c) we have five independent non-executive Directors and certain matters of our Company
must always be referred to the independent non-executive Directors for review; and
(d) 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” 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 close associates after the Listing.
Operational Independence
We do not rely on the Controlling Shareholders and their close associates for our business
development, sales and marketing, financing, staffing, logistics, administration, internal audit,
information technology, or company secretarial functions. We have our own departments specializing
in these respective areas which have been in operation and are expected to continue to operate
separately and independently from the Controlling Shareholders and their 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 and intellectual
property rights 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 the
Controlling Shareholders and their close associates.
Financial Independence
We have an independent financial system and make financial decisions according to our
Group’s own business needs. We have internal control and accounting systems and an independent
finance department in charge of our treasury function. We do not expect to rely on the Controlling
Shareholders and their close associates for financing after the Listing as we expect that our working
capital will be funded by the cash, cash equivalent on hand as well as the proceeds from the Global
Offering.
In addition, we are capable of obtaining financing from independent third parties, if necessary,
without relying on any guarantee or security provided by the Controlling Shareholders or their
respective associates. During the Track Record Period and as of the Latest Practicable Date, there were
no outstanding loans or guarantee provided by or granted to the Controlling Shareholders or their
respective associates. During the Track Record Period and as of the Latest Practicable Date, we had
received a series of Pre-IPO Investments from third party investors independently. See “History,
Development and Corporate Structure” for details of the Pre-IPO Investments.
Based on the above, our Directors believe that we are capable of carrying on our business
independently of, and do not place undue reliance on the Controlling Shareholders or their respective
close associates after the Listing.
279


--- page 289 ---
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
INTERESTS OF THE CONTROLLING SHAREHOLDERS IN OTHER BUSINESSES
Our Controlling Shareholders confirmed that as of the Latest Practicable Date, they 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.
CORPORATE GOVERNANCE
Our Company will comply with the provisions of the Corporate Governance Code, which sets
out principles of good corporate governance.
Our Directors recognize the importance of good corporate governance in protection of our
Shareholders’ interests. We would adopt the following measures to safeguard good corporate
governance standards and to avoid potential conflict of interests between our Group and the
Controlling Shareholders and their respective 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 Global Offering, we have amended our Articles of
Association to comply with the Listing Rules which will become effective upon Listing. In
particular, our Articles of Association provides that, a Director shall 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 Company enters into connected transactions with the
Controlling Shareholders or any of his/its associates, our Company 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 five independent non-executive Directors, and we believe our
independent non-executive Directors (i) possess sufficient experiences, (ii) are free of any
business or other relationship which could interfere in any material manner with the
exercise of their independent judgment, and (iii) will be able to provide an impartial and
external opinion to protect the interests of our Shareholders as a whole. See “Directors,
Supervisors and Senior Management” for details of the independent non-executive
Directors;
(e) where our Directors reasonably request the advice of independent professionals, such as
financial advisors, the appointment of such independent professionals will be made at our
Company’s expenses; and
(f) we have appointed Haitong International Capital Limited as our Compliance Advisor to
provide advice and guidance to us in respect of compliance with the Listing Rules,
including various requirements relating to corporate governance.
280


--- page 290 ---
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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 their respective associates, and to protect minority Shareholders’ interests after the
Listing.
281


--- page 291 ---
SUBSTANTIAL SHAREHOLDERS
So far as our Directors are aware, immediately upon Listing and 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:
H Shares
Assuming the Over-allotment
Option is not exercised
Assuming the Over-allotment
Option is fully exercised
Name of Shareholders Nature of Interest
Number of
H Shares
held upon
completion
of the
Global
Offering
Approximate
Percentage of
Shareholding
in the
relevant class
of Shares
upon
completion of
the Global
Offering
Approximate
Percentage of
Shareholding
in the total
share capital
of our
Company
upon
completion of
the Global
Offering
Approximate
Percentage of
Shareholding
in the
relevant class
of Shares
upon
completion of
the Global
Offering
Approximate
Percentage of
Shareholding
in the total
share capital
of our
Company
upon
completion of
the Global
Offering
Yunsi Shangyi(1) ...... Beneficial interest 5,013,214 12.11% 7.07% 12.04% 7.04%
Interest held jointly
with other persons 7,063,697 17.07% 9.96% 16.97% 9.92%
Yunchuang
Hudong
(1) .......... Beneficial interest 791,747 1.91% 1.12% 1.90% 1.11%
Interest held jointly
with other persons 7,063,697 17.07% 9.96% 16.97% 9.92%
Tianjin Yunsheng
(1) .... Interest in controlled
corporation 5,804,961 14.03% 8.18% 13.95% 8.15%
Interest held jointly
with other persons 7,063,697 17.07% 9.96% 16.97% 9.92%
Dr. Huang
(1) .......... Interest in controlled
corporation 5,804,961 14.03% 8.18% 13.95% 8.15%
Interest held jointly
with other persons 7,063,697 17.07% 9.96% 16.97% 9.92%
Dr. Liang
(1) .......... Beneficial interest 786,710 1.90% 1.11% 1.89% 1.11%
Interest held jointly
with other persons 7,063,697 17.07% 9.96% 16.97% 9.92%
Dr. Kang
(1) ........... Beneficial interest 472,026 1.14% 0.67% 1.13% 0.66%
Interest held jointly
with other persons 7,063,697 17.07% 9.96% 16.97% 9.92%
Trustbridge
Partners
(2) .........
Interest in controlled
corporation 8,649,868 20.90% 12.19% 20.78% 12.15%
TBP HK(2) ........... Beneficial interest 6,202,020 14.99% 8.74% 14.90% 8.71%
TBP II HK(2) ......... Beneficial interest 2,447,848 5.91% 3.45% 5.88% 3.44%
CII Fund ............ Beneficial interest 4,419,328 10.68% 6.23% 10.62% 6.21%
Mr. Sun Ge (3) ......... Interest in controlled
corporation 3,021,549 7.30% 4.26% 7.26% 4.24%
Heyi Guyu(3) ......... Beneficial interest 2,985,422 7.21% 4.21% 7.17% 4.19%
Mr. Li Zhichao (4) ...... Interest in controlled
corporation 152,097 0.37% 0.21% 0.37% 0.21%
JD Shangke .......... Beneficial Interest 2,265,944 5.47% 3.19% 5.44% 3.18%
282


--- page 292 ---
SUBSTANTIAL SHAREHOLDERS
Note:
(1) As of the Latest Practicable Date, Yunsi Shangyi and Yunchuang Hudong directly held 16,710,714 and 2,639,158 Shares, respectively.
The general partner of each of Yunsi Shangyi and Yunchuang Hudong is Tianjin Yunsheng, which is owned as to 99% by Dr. Huang and
1% by Mr. Liu Shengping, our executive Director. Dr. Huang is also the largest limited partner of Yunsi Shangyi with 82.59%
partnership interest. There are no limited partners with 50% or more partnership interest in Tianjin Yunsheng. Therefore, each of Yunsi
Shangyi and Yunchuang Hudong is controlled by Dr. Huang. As such, each of Tianjin Yunsheng and Dr. Huang is deemed to be
interested in the Shares held by Yunsi Shangyi and Yunchuang Hudong for purpose of Part XV of the SFO. As of the Latest Practicable
Date, Dr. Huang, Dr. Liang and Dr. Kang, by virtue of their acting-in-concert arrangement, were collectively interested in approximately
33.93% of our total issued share capital. See the section headed “Relationship with our Controlling Shareholders”. As such, each member
of the Controlling Shareholders is deemed to be interested in the Shares held by other members for purpose of Part XV of the SFO.
(2) Both TBP HK and TBP II HK are investment entities of Trustbridge Partners. As such, Trustbridge Partners is deemed to be interested in
the Shares held by TBP HK and TBP II HK for purpose of Part XV of the SFO.
(3) The general partner of Heyi Guyu is Mr. Sun Ge, and the general partner of Pangu Turing is Beijing Grains Valley, which is owned as to
99% by Mr. Sun Ge. As such, Mr. Sun Ge is deemed to be interested in the Shares held by Heyi Guyu and Pangu Turing for purpose of
Part XV of the SFO.
(4) The general partner of Tianjin Pushu is Mr. Li Zhichao, our non-executive Director. As such, Mr. Li Zhichao is deemed to be interested
in the Shares held by Tianjin Pushu for purpose of Part XV of the SFO.
Domestic Unlisted Shares
Assuming the Over-allotment
Option is not exercised
Assuming the Over-allotment
Option is fully exercised
Name of Shareholders Nature of Interest
Number of
Domestic
Unlisted
Shares held
upon
completion
of the Global
Offering
Approximate
Percentage of
Shareholding
in the
relevant class
of Shares
upon
completion of
the Global
Offering
Approximate
Percentage of
Shareholding
in the total
share capital
of our
Company
upon
completion of
the Global
Offering
Approximate
Percentage of
Shareholding
in the
relevant class
of Shares
upon
completion of
the Global
Offering
Approximate
Percentage of
Shareholding
in the total
share capital
of our
Company
upon
completion of
the Global
Offering
Yunsi Shangyi ....... Beneficial interest 11,697,500 46.80% 16.49% 46.80% 16.43%
Interest held jointly
with other persons 16,481,964 65.94% 23.23% 65.94% 23.15%
Yunchuang Hudong . . . Beneficial interest 1,847,411 7.39% 2.60% 7.39% 2.60%
Interest held jointly
with other persons 16,481,964 65.94% 23.23% 65.94% 23.15%
Tianjin Yunsheng ..... Interest in controlled
corporation 13,544,911 54.19% 19.09% 54.19% 19.03%
Interest held jointly
with other persons 16,481,964 65.94% 23.23% 65.94% 23.15%
Dr. Huang ........... Interest in controlled
corporation 13,544,911 54.19% 19.09% 54.19% 19.03%
Interest held jointly
with other persons 16,481,964 65.94% 23.23% 65.94% 23.15%
Dr. Liang ........... Beneficial interest 1,835,658 7.34% 2.59% 7.34% 2.58%
Interest held jointly
with other persons 16,481,964 65.94% 23.23% 65.94% 23.15%
Dr. Kang ............ Beneficial interest 1,101,395 4.41% 1.55% 4.41% 1.55%
Interest held jointly
with other persons 16,481,964 65.94% 23.23% 65.94% 23.15%
Mr. Li Zhichao ....... Interest in controlled
corporation 176,477 0.71% 0.25% 0.71% 0.25%
283


--- page 293 ---
SUBSTANTIAL SHAREHOLDERS
Unlisted Foreign Shares
Assuming the Over-allotment
Option is not exercised
Assuming the Over-allotment
Option is fully exercised
Name of Shareholders Nature of Interest
Number of
Unlisted
Foreign
Shares held
upon
completion
of the Global
Offering
Approximate
Percentage of
Shareholding
in the
relevant class
of Shares
upon
completion of
the Global
Offering
Approximate
Percentage of
Shareholding
in the total
share capital
of our
Company
upon
completion of
the Global
Offering
Approximate
Percentage of
Shareholding
in the
relevant class
of Shares
upon
completion of
the Global
Offering
Approximate
Percentage of
Shareholding
in the total
share capital
of our
Company
upon
completion of
the Global
Offering
Ming Fu ............ Beneficial interest 4,570,649 100% 6.44% 100% 6.42%
Qiming Venture
Partners III, L.P. ....
Interest in controlled
corporation 4,570,649 100% 6.44% 100% 6.42%
Qiming GP III, L.P. . . . Interest in controlled
corporation 4,570,649 100% 6.44% 100% 6.42%
Qiming Corporate GP
III, Ltd. ...........
Interest in controlled
corporation 4,570,649 100% 6.44% 100% 6.42%
Saved as disclosed herein, our Directors are not aware of any other person who will,
immediately following the completion of the Global Offering (assuming that (i) the Over-allotment
Option is not exercised and (ii) 27,977,641 Domestic Unlisted Shares and 11,849,122 Unlisted Foreign
Shares are converted in H Shares as applied with CSRC under the “Full Circulation” Program), 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 Group.
284


--- page 294 ---
SHARE CAPITAL
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 RMB69,392,473,
comprising 69,392,473 Shares of nominal value RMB1.00 each, was categorized as follows:
Description of Shares Number of Shares
Approximate percentage
to total share
capital (%)
Domestic Unlisted Shares in issue .............................. 52,972,702 76.34%
Unlisted Foreign Shares in issue ............................... 16,419,771 23.66%
Total ..................................................... 69,392,473 100%
UPON COMPLETION OF THE GLOBAL OFFERING
Immediately following completion of the Global Offering and conversion of Domestic Unlisted
Shares and Unlisted Foreign Shares into H Shares, 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 .............................. 24,995,061 35.23
Unlisted Foreign Shares in issue ............................... 4,570,649 6.44
H Shares converted from Domestic Unlisted Shares ................ 27,977,641 39.43
H Shares converted from Unlisted Foreign Shares ................. 11,849,122 16.70
H Shares to be issued under the Global Offering ................... 1,560,980 2.20
Total ..................................................... 70,953,453 100.00
Immediately following completion of the Global Offering and conversion of Domestic Unlisted
Shares and Unlisted Foreign Shares into H Shares, assuming the Over-allotment Option is fully
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 .............................. 24,995,061 35.11
Unlisted Foreign Shares in issue ............................... 4,570,649 6.42
H Shares converted from Domestic Unlisted Shares ................ 27,977,641 39.30
H Shares converted from Unlisted Foreign Shares ................. 11,849,122 16.64
H Shares to be issued under the Global Offering ................... 1,795,120 2.52
Total ..................................................... 71,187,593 100.00
SHARE CLASSES
Upon completion of the Global Offering and conversion of our Domestic Unlisted Shares and
Unlisted Foreign Shares into H Shares, we would have three classes of Shares: H Shares, Domestic
Unlisted Shares and Unlisted Foreign Shares. H Shares, Domestic Unlisted Shares and Unlisted
Foreign Shares are all ordinary Shares in the share capital of our Company.
285


--- page 295 ---
SHARE CAPITAL
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 (such as our certain existing Shareholders,
the Domestic Unlisted Shares and Unlisted Foreign Shares held by whom will be converted in to H
shares according to the approval of the CSRC), H Shares generally cannot be subscribed for by or
traded between legal or natural persons of the PRC.
Domestic Unlisted Shares, Unlisted Foreign Shares and H Shares shall rank pari passu with
each other in all respects and, in particular, will rank equally for dividends or distributions declared,
paid or made. All dividiends for H Shares will be denominated and declared in Renminbi, and paid in
Hong Kong dollars or Renminbi, whereas all dividends for Domestic Unlisted Shares and Unlisted
Foreign Shares will be paid in Renminbi. Other than cash, dividends could also be paid in the form of
shares.
CONVERSION OF DOMESTIC UNLISTED SHARES AND UNLISTED FOREIGN SHARES
INTO H SHARES
If any of the Domestic Unlisted Shares and the Unlisted Foreign Shares are to be converted,
listed and traded as H Shares on the Hong Kong 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 Hong Kong Stock Exchange.
Register with the CSRC and Full Circulation Application
In accordance with the Overseas Listing Trial Measures and related guidelines promulgated by
the CSRC, H-share listed companies which apply for the conversion of domestic 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 listing.
We have received the filing notice from the CSRC in relation to the filing of the overseas
listing and the conversion of 27,977,641 Domestic Unlisted Shares and 11,849,122 Unlisted Foreign
Shares into H Shares on a one-for-one basis upon the completion of the Global Offering.
Listing Approval by the Hong Kong Stock Exchange
We have applied to the Listing Committee of the Hong Kong Stock Exchange for the granting
of the 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 27,977,641 Domestic Unlisted Shares and 11,849,122 Unlisted
Foreign Shares on the Hong Kong Stock Exchange, which is subject to the approval by the Hong Kong
Stock Exchange.
We will perform the following procedures for the conversion of the relevant Domestic Unlisted
Shares and Unlisted Foreign 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 the CCASS.
286


--- page 296 ---
SHARE CAPITAL
RESTRICTION ON TRANSFER OF SHARES ISSUED PRIOR TO THE GLOBAL
OFFERING
In accordance with Article 160 of the PRC Company Law, the shares issued prior to any listing
of shares by a company cannot be transferred within one year from the date on which such publicly
offered shares are listed and traded on the relevant stock exchange. As such, the Shares issued by the
Company prior to the Global Offering will be subject to such statutory restriction on transfer within a
period of one year from the Listing.
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. See “Appendix V – Summary of the Articles of
Association” in this document.
287


--- page 297 ---
CORNERSTONE INVESTORS
THE CORNERSTONE PLACING
We have entered into cornerstone investment agreements (each a “ Cornerstone Investment
Agreement” and collectively, the “ Cornerstone Investment Agreements ”) with the cornerstone
investors set out below (each a “Cornerstone Investor” and collectively, the “ Cornerstone
Investors”), pursuant to which the Cornerstone Investors have agreed to, subject to certain conditions,
subscribe, or cause their designated entities to subscribe, at the Offer Price for such number of Offer
Shares (rounded down to the nearest whole board lot of 20 H Shares) that may be purchased for an
aggregate amount equivalent to HK$95.5 million, calculated based on the conversion rate of HK$1.00
to RMB0.9154 (the “Cornerstone Placing”).
Assuming an Offer Price of HK$165.00 per Share, being the low-end of the indicative Offer
Price range set out in this prospectus, the total number of Offer Shares to be subscribed by the
Cornerstone Investors would be 575,060 Offer Shares. The table below reflects the shareholding
percentage immediately after the completion of the Global Offering.
Assuming the Over-allotment Option is not exercised Assuming the Over-allotment Option is exercised in full
Approximate % of the
Offer Shares
Approximate % of the
total issued share capital
Approximate % of the
Offer Shares
Approximate % of the
total issued share capital
36.84 0.81 32.03 0.81
Assuming an Offer Price of HK$185.00 per Share, being the mid-point of the indicative Offer
Price range set out in this prospectus, the total number of Offer Shares to be subscribed by the
Cornerstone Investors would be 575,060 Offer Shares. The table below reflects the shareholding
percentage immediately after the completion of the Global Offering.
Assuming the Over-allotment Option is not exercised Assuming the Over-allotment Option is exercised in full
Approximate % of the
Offer Shares
Approximate % of the
total issued share capital
Approximate % of the
Offer Shares
Approximate % of the
total issued share capital
32.86 0.71 28.57 0.72
Assuming an Offer Price of HK$205.00 per Share, being the high-end of the indicative Offer
Price range set out in this prospectus, the total number of Offer Shares to be subscribed by the
Cornerstone Investors would be 462,860 Offer Shares. The table below reflects the shareholding
percentage immediately after the completion of the Global Offering.
Assuming the Over-allotment Option is not exercised Assuming the Over-allotment Option is exercised in full
Approximate % of the
Offer Shares
Approximate % of the
total issued share capital
Approximate % of the
Offer Shares
Approximate % of the
total issued share capital
29.65 0.65 25.78 0.65
Our Company is of the view that the Cornerstone Investment will help raise the profile of our
Company and to signify that such investors have confidence in our business and prospect. Further, we
believe that we will benefit from the cornerstone investment, taking into account the business sectors
they primarily focus on. Our Company became acquainted with each of the Cornerstone Investors in its
ordinary course of operation through the Group’s business network or through introduction by the
Company’s shareholders, business partners or Overall Coordinators.
The Cornerstone Placing will form part of the International Offering, and save as otherwise
waived/obtained consent by the Stock Exchange, the Cornerstone Investors will not subscribe for any
Offer Shares under the Global Offering other than pursuant to the Cornerstone Investment Agreements.
288


--- page 298 ---
CORNERSTONE INVESTORS
The Offer Shares to be subscribed by the Cornerstone Investors will rank pari passu in all respects
with the fully paid Shares in issue and all the H Shares to be subscribed by the cornerstone investors
will be counted towards the public float for the purpose of Rule 8.08 of the Listing Rules. Immediately
following the completion of the Global Offering, the Cornerstone Investors will not have any Board
representation in our Company; and none of the Cornerstone Investors will become a Substantial
Shareholder of our Company. The Cornerstone Investors do not have any preferential rights in the
Cornerstone Investment Agreements compared with other public Shareholders, other than a guaranteed
allocation of the relevant Offer Shares at the Offer Price.
As confirmed by each of the Cornerstone Investors, there are no side arrangements between the
Company, and the Cornerstone Investors, or any benefit, direct or indirect, conferred on the
Cornerstone Investors, by virtue of or in relation to the Listing other than a guaranteed allocation of the
relevant Offer Shares at the Offer Price, following the principles as set out in Chapter 4.15 of the Guide
for New Listing Applicants.
The Cornerstone Investors have agreed to pay for the relevant Offer Shares that they have
subscribed before dealings in the Company’s Shares commence on the Stock Exchange. There will be
no deferred settlement of the Offer Shares to be subscribed by the Cornerstone Investors. Where
delayed delivery takes place, each Cornerstone Investor that may be affected by such delayed delivery
has agreed that it shall nevertheless pay for the relevant Offer Shares in full before the Listing.
To the best of the knowledge, information and belief of our Company, (i) the Cornerstone
Investors are independent of the Company, its connected persons and their respective associates;
(ii) none of the Cornerstone Investor is accustomed to take and has not taken instructions from the
Company, our Directors, Supervisors, chief executive, Controlling Shareholders, substantial
Shareholders, existing Shareholders or any of its subsidiaries or their respective close associates in
relation to the acquisition, disposal, voting or other disposition of the Offer Shares; and (iii) none of the
subscription of the Offer Shares by the Cornerstone Investors is financed by the Company, our
Directors, Supervisors, chief executive, Controlling Shareholders, substantial Shareholders, existing
Shareholders or any of its subsidiaries or their respective close associates.
To the best knowledge of the Company and the Overall Coordinators, and based on the
indicative interest of investment of the Cornerstone Investors and/or their close associates as of the
date of this prospectus, certain Cornerstone Investors and/or their close associates may participate in
the International Offering as placees and subscribe for further Offer Shares in the Global Offering. The
Company will seek the Stock Exchange’s consent and/or waiver to allow the Cornerstone Investors
and/or their close associates to participate in the International Offering as placees pursuant to Chapter
4.15 of the Guide for New Listing Applicants. Whether such Cornerstone Investors and/or their close
associates will place orders in the International Offering are uncertain and will be subject to the final
investment decisions of such investors and the terms and conditions of the Global Offering.
To the best knowledge of our Company, the Cornerstone Investors make independent
investment decisions, and their subscription under the Cornerstone Investment Agreements would be
financed by their own internal resources and they have sufficient funds to settle their respective
investment under the Cornerstone Placing. Each of the Cornerstone Investor has confirmed that all
necessary approvals have been obtained with respect to the Cornerstone Placing, and that no specific
approval from any stock exchange (if relevant) or its shareholders is required for the relevant
cornerstone investment.
289


--- page 299 ---
CORNERSTONE INVESTORS
Details of the actual number of Offer Shares to be allocated to the Cornerstone Investors will be
disclosed in the allotment results announcement of our Company to be published on or around June 27,
2025.
The table below sets forth the details of the Cornerstone Placing:
Based on the Offer Price of HK$165.00 (being the low-end of the indicative Offer Price range)
Assuming the Over-allotment
Option is not exercised
Assuming the Over-allotment
Option is fully exercised
Cornerstone Investors
Total
Investment
Amount
Number of
Offer
Shares to be
subscribed(1)
Approximate
% of the
Offer Shares
Approximate %
of our total issued
share capital
immediately upon
completion of the
Global Offering
Approximate
% of the
Offer Shares
Approximate %
of our total issued
share capital
immediately upon
completion of the
Global Offering
SensePower Management
Limited
(“SensePower” ) ...... H K $ 43,698,177 262,180 16.80 0.37 14.61 0.37
Nebula Asset
Management Limited
(“Nebula” ) .......... H K $ 3 0 million 181,800 11.65 0.26 10.13 0.26
Runjian International
(Hong Kong) Co.,
Limited.
(“Runjian
International” ) ...... RMB 20 million 131,080 8.40 0.18 7.30 0.18
Total ................. 575,060 36.84 0.81 32.03 0.81
Based on the Offer Price of HK$185.00 (being the mid-point of the indicative Offer Price range)
Assuming the Over-allotment
Option is not exercised
Assuming the Over-allotment
Option is fully exercised
Cornerstone Investors
Total
Investment
Amount
Number of
Offer
Shares to be
subscribed(1)
Approximate
% of the
Offer Shares
Approximate %
of our total issued
share capital
immediately upon
completion of the
Global Offering
Approximate
% of the
Offer Shares
Approximate %
of our total issued
share capital
immediately upon
completion of the
Global Offering
SensePower ........... H K $ 43,698,177 233,840 14.98 0.33 13.03 0.33
Nebula ............... H K $ 3 0 million 162,160 10.39 0.23 9.03 0.23
Runjian International .... R M B 2 0 million 116,920 7.49 0.16 6.51 0.16
Total ................. 512,920 32.86 0.72 28.57 0.72
Based on the Offer Price of HK$205.00 (being the high-end of the indicative Offer Price range)
Assuming the Over-allotment
Option is not exercised
Assuming the Over-allotment
Option is fully exercised
Cornerstone Investors
Total
Investment
Amount
Number of
Offer
Shares to be
subscribed(1)
Approximate
% of the
Offer Shares
Approximate %
of our total issued
share capital
immediately upon
completion of the
Global Offering
Approximate
% of the
Offer Shares
Approximate %
of our total issued
share capital
immediately upon
completion of the
Global Offering
SensePower ........... H K $ 43,698,177 211,020 13.52 0.30 11.76 0.30
Nebula ............... H K $ 3 0 million 146,340 9.37 0.21 8.15 0.21
Runjian International .... R M B 2 0 million 105,500 6.76 0.15 5.88 0.15
Total ................. 462,860 29.65 0.65 25.78 0.65
Notes:
(1) Subject to rounding down to the nearest whole board lot of 20 H Shares. Calculated based on the exchange rate set out in the section
headed “Information about this Prospectus and the Global Offering – Currency Translations .”
290


--- page 300 ---
CORNERSTONE INVESTORS
(2) The subscription amounts of SensePower and Runjian International were inclusive of brokerage, SFC transaction levy, AFRC transaction
levy and the Stock Exchange trading fee.
(3) The subscription amount of Nebula was exclusive of brokerage, SFC transaction levy, AFRC transaction levy and the Stock Exchange
trading fee which Nebula will pay in respect of the International Offer Shares to be subscribed by it.
THE CORNERSTONE INVESTORS
The information about our Cornerstone Investors set forth below has been provided by our
Cornerstone Investors in connection with the Cornerstone Placing.
SensePower
SensePower Management Limited (“ SensePower”) is a company incorporated in the BVI and
is principally engaged in investment holding. SensePower is an indirect wholly-owned subsidiary of
SenseTime Group Inc. (“ SenseTime”), a company listed on the Main Board of the Stock Exchange
(stock code: 0020.HK). SenseTime is a leading AI software company with a focus on computer vision
technologies, serving a broad range of industries in smart business, smart city, smart life and smart
auto. As of December 31, 2024, there was no ultimate beneficial owner with 30% interest or more in
SenseTime.
Nebula
Nebula Asset Management Limited (
ʮ̡)( “ Nebula”) is a licensed asset
management company based in Hong Kong. It is focused on fundamental research and value investing,
primarily investing in companies in the greater China region. Its ultimate beneficial owner is CHENG,
NGA YIN who is an Independent Third Party. As of December 31, 2024, Nebula had an AUM of over
HK$50 million.
Runjian International
Runjian International (Hong Kong) Co., Limited (“ Runjian International”) is incorporated in
Hong Kong, which is a wholly-owned subsidiary of Runjian Co., Ltd. (
ʮ̡), a company
listed on the Shenzhen Stock Exchange (stock code: 002929). Runjian Co., Ltd. is a leading digital
intelligent operation and maintenance service provider and one of the top 100 software companies in
the PRC, providing solutions covering communication networks, digital networks, energy networks
and other fields. Runjian Co., Ltd. is ultimately controlled as to 47.83% by Mr. Li Jianguo (
਷) and
Ms. Jiang Libei ( ᇸ㕆̏), each being an Independent Third Party.
CLOSING CONDITIONS
The obligation of each Cornerstone Investor to subscribe for the Offer Shares under the respective
Cornerstone Investment Agreement is subject to, among other things, the following closing conditions:
(i) the Hong Kong Underwriting Agreement and the International Underwriting Agreement
being entered into and having become effective and unconditional (in accordance with
their respective original terms or as subsequently waived or varied by agreement of the
parties thereto) by no later than the time and date as specified in the Hong Kong
Underwriting Agreement and the International Underwriting Agreement, and neither the
Hong Kong Underwriting Agreement nor the International Underwriting Agreement
having been terminated;
(ii) the Offer Price having been agreed upon between our Company and the Overall
Coordinators (for themselves and on behalf of the underwriters of the Global Offering);
291


--- page 301 ---
CORNERSTONE INVESTORS
(iii) the Listing Committee having granted the approval for the listing of, and permission to
deal in, the Shares (including the Shares under the Cornerstone Placing) as well as other
applicable waivers and approvals and such approval, permission or waiver having not been
revoked prior to the commencement of dealings in the Shares on the Stock Exchange;
(iv) no laws shall have been enacted or promulgated which prohibits the consummation of the
transactions contemplated in the Global Offering or the respective Cornerstone Investment
Agreement, and there being no orders or injunctions from a court of competent jurisdiction
in effect precluding or prohibiting consummation of such transactions; and
(v) the respective agreements, representations, warranties, undertakings, confirmations and
acknowledgements of the Cornerstone Investors under the respective Cornerstone
Investment Agreement are (as of the date of the Cornerstone Investment Agreement) and
will be (as of the Closing (as defined in the Cornerstone Investment Agreement)) accurate
and true in all respects and not misleading and that there is no breach of the respective
Cornerstone Investment Agreement on the part of the relevant Cornerstone Investor.
RESTRICTIONS ON THE CORNERSTONE INVESTORS
Each Cornerstone Investor has agreed that without the prior written consent of our Company,
the Joint Sponsors and the Overall Coordinators, it will not, whether directly or indirectly, at any time
during the period of twelve months following the Listing Date (the “ Lock-up Period”), dispose of, in
any way, any of the Offer Shares it has purchased, pursuant to the respective Cornerstone Investment
Agreement, save for certain limited circumstances, such as transfers to any of its wholly-owned
subsidiaries who will be bound by the same obligations of the Cornerstone Investor, including the
Lock-up Period restriction.
292


--- page 302 ---
FINANCIAL INFORMATION
You should read the following discussion and analysis with our audited consolidated
financial information, including the notes thereto, included in the Accountant’s Report in
Appendix I to this prospectus. Our consolidated financial information has been prepared in
accordance with IFRS, which may differ in material aspects from generally accepted accounting
principles in other jurisdictions.
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. In
evaluating our business, you should carefully consider the information provided in this
prospectus, including but not limited to the sections headed “Risk Factors” and “Business.”
For the purpose of this section, unless the context otherwise requires, references to 2022,
2023 and 2024 refer to our financial years ended December 31 of such years. Unless the context
otherwise requires, financial information described in this section is described on a consolidated
basis.
OVERVIEW
We are an AI company dedicated to the innovation in AGI technology in China, with strong
record in commercializing large language models, the critical path towards AGI. Inherently operating
through the direct and continuous interaction with human, conversational AI benefits from this
feedback loop that automatically and incessantly advances its abilities, and demonstrates potential for
AGI commercialization. Soon after the breakthroughs of Transformer in 2017 and BERT in 2018,
leveraging our R&D expertise in conversational AI and market insights gained since our inception, we
launched our first BERT-based large language model, UniCore, which functioned as the initial core
algorithm model of our central technology platform, UniBrain, and empowered a series of AI solutions
for customers across a wide range of industry verticals. Our AI technology continues to advance with
multimodal capabilities and a vast wealth of dynamic, iterating user interactions across diverse
application scenarios.
We have offered products and solutions on the UniBrain technology platform for a broad range
of application scenarios in AI Solution in Daily Life and AI Service and Solution in Healthcare.
According to Frost & Sullivan, we remained the fourth largest AI solution provider by revenue in
China with a market share of 0.6% in each year of the Track Record Period, yet recording a high
growth rate among those with annual revenues over RMB500 million. While the market size of AI
solution in China increased by 33.1% from RMB135.5 billion in 2023 to RMB180.4 billion in 2024,
our revenue increased by 29.1% from RMB727.3 million in 2023 to RMB939.0 million in 2024. In
2024, we ranked third by revenue in AI Solution in Daily Life and fourth in AI Solution in Healthcare
in China. Extensive commercial application of these products and solutions has provided us with high-
quality user feedback, which, in turn, prompting incessant iterations of UniGPT as the core of
UniBrain.
During the Track Record Period, our revenue was primarily derived from the sales of AI products
and solutions. Our revenue increased from RMB600.6 million in 2022 to RMB939.0 million in 2024,
with a CAGR of 25.0%; our gross profit increased from RMB239.9 million in 2022 to RMB
364.5 million in 2024, with a CAGR of 23.3%; our net losses in 2022, 2023 and 2024 were
293


--- page 303 ---
FINANCIAL INFORMATION
RMB375.4 million, RMB376.2 million, and RMB454.2 million, respectively; and adding back share-
based payment expenses, finance cost of intere st on redemption liabilities and listing expenses, our
adjusted net losses (non-IFRS financial measure) for 2022, 2023 and 2024 were RMB183.2 million,
RMB136.6 million, RMB168.4 million, respectively.
BASIS OF PREPARATION
Our historical financial information has been prepared in accordance with the IFRS Accounting
Standards issued by the IASB.
The preparation of our historical financial information in conformity with the 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 our
historical financial information are disclosed in Note 4 of the Accountant’s Report in Appendix I to
this prospectus.
All relevant standards, amendments and interpretations to the existing standards that are
effective during the Track Record Period have been adopted by us consistently throughout the Track
Record Period.
MAJOR FACTORS AFFECTING OUR RESULTS OF OPERATIONS AND FINANCIAL
CONDITION
Our results of operations and financial condition have been, and are expected to continue to be,
materially affected by a number of factors, many of which are outside of our control, including the
following:
General Factors
Our business and operating results are affected by general factors affecting the overall growth
and prosperity of the AI industry in China, including:
Š China’s overall economic growth;
Š the increasing applications of AI products and solutions across industries;
Š technology development, including the development of large language models and the
advancement of computing infrastructure;
Š the prevalence of IoT devices; and
Š relevant laws and regulations, governmental policies and initiatives.
Company Specific Factors
Enhance AI Technology Strengths and Deliver Innovative AI Solutions
During the Track Record Period, our revenue experienced significant growth from RMB600.6
million in 2022, to RMB727.3 million in 2023 and further increased to RMB939.0 million in 2024
which was primarily driven by our success in penetrating into the AI Solution in Daily Life and AI
Service and Solution in Healthcare industries with our AI product and solution offerings. As of
294


--- page 304 ---
FINANCIAL INFORMATION
December 31, 2024, our Daily Life products were applied to tens of millions of devices, across various
verticals such as residential, commercial space, hospitality and transportation, helping us gain valuable
know-how and experiences. In addition, we offer AI-empowered healthcare solutions such as medical
record voice entry, medical record quality control, single-disease quality control, medical insurance
payment management, which help prevent unreasonable medical expenses, support medical reform and
improve the utilization and efficiency of medical insurances.
Leveraging UniBrain’s capabilities, we are able to efficiently develop and optimize our AI
models and improve the performance of our solutions. We offer customers a wide variety of model-
based AI solutions and products, helping them improve operational efficiency and productivity,
bringing value to end users across industries. Through relentless innovation, we plan to extend the
reach of our AI products and solutions to a broader range of industry verticals. To be constantly able to
deliver cutting-edge AI products and solutions that create value for customers would allow us to adopt
more favorable pricing strategy and improve our profitability.
Expand Customer Base and Deepen Customer Relationships
Our customers primarily include enterprise customers and system integrators in AI solution in
IoT and medical service industries. Customer acceptance and satisfaction among a growing customer
base will strengthen our brand and reputation which are crucial to our long-term growth. We rely on
the performance of our AI solutions as well as our sales team and customer support team to initiate and
maintain customer relationship. Our seasoned sales and customer support staff have profound industry
insight and knowledge of our AI products and solutions. We were therefore able to continually expand
our customer base. We incurred selling and marketing expenses of RMB46.1 million, RMB58.8
million, and RMB70.7 million in 2022, 2023 and 2024, respectively, reflecting our consistent efforts in
marketing and promotional activities to drive our business growth. However, we managed to improve
sales efficiency thanks to growing brand recognition, and the number of our customers increased from
538 in 2022 to 555 in 2023 and further increased to 576 in 2024.
Our success in fostering loyalty of existing customers and attracting new customers also
depends on our effective go-to-market strategy. We have established robust partnerships with industry
leaders to jointly develop innovative AI solutions and gain invaluable market insights, and secure
future project and technology collaborations. Leveraging the know-how, experience and market
recognition acquired from our lighthouse customers and the high scalability of our AI solutions, we
introduce our solutions to other customers in the same or adjacent industries, offering them innovative
solutions that are quick-to-deploy on demand, addressing common needs and representative scenarios
in the industry. This go-to-market strategy allows us to continuously enhance the level of engagement
of our key customers with constantly improved offerings, and grow our customer base. We believe
long-term, robust customer relationship are crucial to our ability to optimize commercialization
strategies and fee models, including expanding our subscription-based MaaS solutions, which would
allow us to achieve continued growth, higher sustainability and more stable cashflow, and improve our
results of operation.
Manage Costs and Improve Operational Efficiency
Our abilities to manage our costs and operating expenses also have profound impact to our
results of operations. We incurred significant cost of hardware, accounting for 46.6%, 41.6% and
33.3% of our revenue in 2022, 2023 and 2024, respectively. Going forward, we estimate that such
295


--- page 305 ---
FINANCIAL INFORMATION
costs as a percentage of revenue will reduce as the revenue contribution from AI solutions that
generally contain less hardware is expected to grow, which will help improve our gross profit margin.
We also expect to be able to reduce product deployment and implementation costs as we continue to
standardize our products and solutions.
In addition, as our business continues to grow, we expect our ability to manage general
administrative costs will help us continue to optimize efficiency.
We plan to continue our investment in AI infrastructure and R&D activities to maintain our
leading position through innovation, underpinning continued improvement of operational efficiency.
Leveraging the increasing technological strengths and efficiency, we aim to reduce the marginal cost
for the production of AI products and solutions, as well as accelerate revenue growth.
To enhance R&D efficiency and allow our R&D staff to focus on the development of core AI
models and technologies, we typically outsource non-essential R&D tasks to third-party contractors.
Combining in-house R&D with outsourcing also helped us maintain an efficient and agile R&D force.
From 2022 to 2024, our R&D expenses grew from RMB287.1 million to RMB370.1 million at a
CAGR of 13.5%, driving a stronger growth of revenue from RMB600.6 million to RMB939.0 million
at a CAGR of 25.0% during the same year. UniGPT, launched in 2023, is expected to help us further
improve our R&D efficiency.
Going forward, we expect to achieve revenue growth at a rate higher than that of our R&D and
other expenses as a whole, continuously improving our operational efficiency.
Seasonality
Our business and results of operations are affected by seasonality, resulting from seasonal
fluctuations in customer purchases. Our customers adhere to an annual cycle for budget planning and
implementation. Customers typically formulate the budget, enter into contracts, execute the
transactions and initiate the projects based on their business plans in the first half of the fiscal year, and
accept the products or solutions deliverables and complete the transactions in the latter half of the year.
As we typically recognize revenue upon acceptance by the customer, we had higher revenue from our
products and solutions in the second half of the fiscal year, which is in line with the industry norm,
according to Frost & Sullivan. This pattern is consistent across both our public and private sector
customers, as observed in both Daily Life and Healthcare businesses during the Track Record Period,
and we anticipate that this trend will continue in the future.
IMPACT OF COVID-19 PANDEMIC
The COVID-19 pandemic outbreak, its recurrence and related measures caused a decline in the
business activities in the industries we operate in, and a shift of focus of potential and existing
customers, especially the hospitals, to pandemic prevention and control. The COVID-19 pandemic had
historically caused disruptions in the payment schedule of certain of our public sector end users, who
had diverted their budget and focused on containing and combating the pandemic. In addition, certain
of our customers in private sector were adversely impacted due to the challenging macro-economic
environment during the post-pandemic recovery, leading to adjustment of their financial management
policies and slowdown in settlement of payables with their service providers, including us. As a result,
our trade receivables turnover days increased in 2022.
296


--- page 306 ---
FINANCIAL INFORMATION
Since December 2022, the restrictive measures have been generally eased. See “Risk Factors —
Risks Relating to Our Industry and Business — We may experience any future occurrence of force
majeure events, natural disasters or outbreaks of contagious diseases.”
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
We have identified certain accounting policies that are significant to the preparation of our
consolidated financial statements. Some of our accounting policies require us to apply estimates and
assumptions as well as complex judgments related 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 operational results. Our management continually evaluates such estimates,
assumptions and judgments based on past experience and other factors, including industry practices
and expectations of future events that are deemed to be reasonable under the circumstances. There has
not been any material deviation from 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.
We set forth below those 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. Our material accounting policy information, estimates, assumptions and
judgments, which are important for understanding our financial condition and results of operations, are
set forth in Note 2 to the Accountant’s Report in Appendix I to this prospectus.
Revenue Recognition
Revenue for AI solutions and AI products is recognized at the point in time when the products
or solutions are delivered to the customer’s designated place, inspected, and accepted by the customer.
We offer AI solutions for a wide range of industries and application scenarios such as residential,
commercial space, hospitality and transportation. AI solutions are provided by integrating AI software,
software-embedded hardware, hardware infrastructure, and related AI technology services. All these
components are highly interdependent and interrelated, and together they create a combined output that
is transferred to the customer. Therefore, they are accounted for as a single performance obligation. We
also provide stand-alone AI products, such as AI software and software-embedded hardware.
When providing standalone AI services for a certain period of time, such as extended warranty
and cloud services, which are considered as separate performance obligations, revenue is recognized
over time during the service period.
Daily Life
Revenue from goods and services used in industry verticals and application scenarios such as
residential, commercial space, hospitality and transportation is categorized as from Daily Life. For AI
solutions, in a typical transaction, we shall deliver the integrated hardware and software to the delivery
place designated by the customer and install the products, and the customer shall be deemed to have
completed the delivery only after receiving the products and completing the acceptance inspection of
the products, installation and trial run. After successful integrated development, installation and
commissioning of hardware materials and software and successful acceptance, both parties shall sign
297


--- page 307 ---
FINANCIAL INFORMATION
and seal the acceptance confirmation. The revenue is recognized upon acceptance by the customer and
issuance of acceptance confirmation. For AI products, revenue is recognized at a point in time when
the AI products are delivered to the customer’s designated place and accepted by the customer.
Healthcare
When we provide medical transcription solutions, smart medical record quality management
solutions and other AI empowered medical solutions to medical institutions, revenue is categorized as
from Healthcare. In a typical transaction, after the system is launched and trial run is completed, we
shall promptly notify the customer for acceptance. The customer shall start the acceptance inspection
and sign the acceptance confirmation within a certain period upon receipt of the acceptance notice. The
revenue is recognized upon acceptance by the customer and issuance of acceptance confirmation.
See Note 2.1.7 to the Accountant’s Report in Appendix I to this prospectus.
Financial Liabilities at Fair Value through Profit or Loss
Certain investors in previous financing of Series (the “ Investors”) were granted certain special
rights, such as the anti-dilution right, pursuant to which the Investors have a right to require: (i) Yunsi
Shangyi, Dr. Kang and Dr. Liang to transfer the equity interests in us, which they directly or indirectly
held to the Investors at the lowest price allowed by law; or (ii) us to issue new shares to the Investors
for nominal consideration; or (iii) Yunsi Shangyi, Dr. Kang and Dr. Liang to compensate the Investors
in cash. The specific method shall be selected by the Investors, and Yunsi Shangyi, Dr. Kang and Dr.
Liang shall be jointly and severally liable for this. Pursuant to the Shareholder Agreement, all the
special rights of the Pre-IPO Investors will cease to be effective when we submit the listing
application, subject to certain conditions.
The anti-dilution right granted is bifurcated and accounted for as financial liabilities at fair
value through profit or loss. It is initially recognized at fair value and subsequently carried at fair value
with fair value changes recognized in “Other gains—net” in the consolidated statements of
comprehensive loss. The financial liabilities are classified as non-current liabilities unless we have an
obligation to settle the liabilities within 12 months after the end of the reporting period.
We derecognize such financial liabilities when, and only when, our obligations are discharged,
canceled or have expired. The carrying amount of the financial liabilities derecognized is then credited
into equity.
Redemption Liabilities
A contract that contains an obligation 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 is conditional on the counterparty exercising a right to redeem. We
undertake such redemption obligations as preferred rights granted to certain investors in our financing
process. Such redemption obligation is recognized as financial liability initially at the present value of
the redemption amount and subsequently measured at amortized cost with interest charged as finance
costs.
We derecognize redemption liabilities when, and only when, the redemption obligations are
discharged, canceled or expired. The carrying amount of the derecognized redemption liabilities is then
credited into equity.
298


--- page 308 ---
FINANCIAL INFORMATION
Trade Receivables
Trade receivables are amounts due from customers for goods sold or services provided 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. We hold
the trade receivables with the objective of collecting the contractual cash flows and therefore measure
them subsequently at amortized cost using the effective interest method.
We apply the IFRS 9 simplified approach to measuring expected credit losses 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, credit rating, and aging based on
revenue recognition. See “— Financial Risk Disclosure — Credit Risk — Impairment of financial
assets and contract assets.”
We make loss allowance for financial assets based on assumptions about risk of default and
expected loss rate. We use judgment in making these assumptions and selecting inputs to the
impairment calculation, based on our past history, existing market conditions as well as forward
looking estimates at the end of each reporting period. For the carrying amounts of our trade receivables
and contract assets, other receivables and financial lease receivables, see Note 3.1 to the Accountant’s
Report in Appendix I to this prospectus.
Impairment of non-financial assets
At the end of each year during the Track Record Period, we performed impairment testing for
our non-financial assets including property, plant and equipment, right-of-use assets and intangible
assets due to the losses incurred. These non-financial assets mainly comprise of servers and other
electronic equipment, office rental and software which we integrally used for the research and
development and the delivery of AI solutions and AI products, so that the management treated our
Group as a single cash generating unit (“CGU”) for the impairment testing purpose. The recoverable
amounts of the identified CGU were determined based on the fair value less cost of disposal, which
substantially exceeded the carrying amount of the CGU at the end of each year during the Track
Record Period, and the estimated fair value was determined by the enterprise value of our Group for
each year during the Track Record Period (evaluated and acknowledged by independent third parties in
the latest rounds of financing). Based on the result of above impairment testing, the management
determined that there was no impairment for abovementioned non-financial assets at the end of each
year during the Track Record Period.
Inventories
Inventories are stated at the lower of cost and net realizable value. Cost comprises direct
materials, direct labor and an appropriate proportion of variable and fixed overhead expenditure, the
latter being allocated on the basis of normal operating capacity. Cost of direct material is determined
on weighted average basis. Net realizable value is the estimated selling price in the ordinary course of
business, less the estimated costs of completion and the estimated costs necessary to make the sale.
299


--- page 309 ---
FINANCIAL INFORMATION
For contract fulfillment cost, it mainly comprises direct hardware and software costs, as well as
direct labor cost incurred while delivering the AI solutions to the customers. The contract fulfillment
cost is recognized as assets and presented in inventory only if those costs meet all of the following
criteria:
Š the costs relate directly to a contract or to an anticipated contract that the entity can
specifically identify;
Š the costs generate or enhance resources of the entity that will be used in satisfying (or in
continuing to satisfy) performance obligations in the future; and
Š the costs are expected to be recovered.
The contract fulfillment cost recognized will be transferred directly to profit or loss at the time
that related revenue of AI solutions is recognized.
We recognize an impairment loss in profit or loss to the extent that the carrying amount of
contract fulfillment cost recognized exceeds:
Š the remaining amount of consideration that the entity expects to receive in exchange for
the services to which the asset relates; less
Š the costs that relate directly to providing those services and that have not been recognized
as expenses.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
The following table sets out a summary of our consolidated statements of comprehensive loss
for the years indicated:
Year ended December 31,
2022 2023 2024
(RMB in thousands)
R e v e n u e ........................................................ 600,619 727,316 939,017
Cost of sales and services ........................................... (360,732) (432,808) (574,537)
Gross profit ..................................................... 239,887 294,508 364,480
Operating expenses:
Research and development expenses .................................. (287,099) (286,301) (370,073)
Selling and marketing expenses ...................................... (46,086) (58,810) (70,705)
Administrative expenses ........................................... ( 48,420) (65,020) (64,105)
Net impairment losses on financial assets and contract assets ............... ( 71,976) (91,346) (48,438)
Other income .................................................... 15,746 36,313 17,077
Other (losses)/gains - net ........................................... ( 1,363) 10,579 (13,964)
Total operating expenses .......................................... (439,198) (454,585) (550,208)
Finance income .................................................. 3 1 4 1,875 2,298
Finance costs .................................................... ( 177,675) (212,770) (270,943)
Finance costs-net ................................................ (177,361) (210,895) (268,645)
Share of profit/(loss) from investments accounted for using the equity
method ....................................................... 1,092 (2,617) —
Loss before income tax ............................................ (375,580) (373,589) (454,373)
Income tax credit/(expense) ......................................... 1 8 9 (2,655) 162
Loss for the year ................................................. (375,391) (376,244) (454,211)
Loss for the year attributable to:
- Owners of the Company .......................................... ( 366,012) (375,461) (452,364)
- Non-controlling interests .......................................... ( 9,379) (783) (1,847)
(375,391) (376,244) (454,211)
300


--- page 310 ---
FINANCIAL INFORMATION
NON-IFRS FINANCIAL MEASURE
To supplement our consolidated financial statements presented in accordance with the IFRS
Accounting Standards, we use adjusted net loss (non-IFRS financial measure) as additional financial
measure, which is not required by, or presented in accordance with, the IFRS Accounting Standards.
We believe that this non-IFRS measure facilitates comparisons of operating performance from period
to period and company to company by eliminating potential impacts of items. We believe that this
measure provides useful information to investors in understanding and evaluating our consolidated
results of operations in the same manner as they help our management. However, presentation of
adjusted net loss (non-IFRS financial measure) may not be comparable to similarly titled measures
presented by other companies. The use of this non-IFRS measure has limitations as an analytical tool,
and investors should not consider it in isolation from, or as a substitute for analysis of, our results of
operations or financial conditions as reported under the IFRS Accounting Standards.
We define adjusted net loss (non-IFRS financial measure) as net loss for the year adjusted by
adding back share-based payment expenses, finance cost of interest on redemption liabilities, and
listing expenses. The following table sets forth a reconciliation of our non-IFRS financial measure for
the years indicated to the nearest measure prepared in accordance with the IFRS Accounting Standards
which is net loss for the year:
Year ended December 31,
2022 2023 2024
(RMB in thousands)
Loss for the year ................................................. (375,391) (376,244) (454,211)
Add:
Share-based payment expenses to employees (1) .......................... - 4,532 -
Finance cost of interest on redemption liabilities (2) ....................... 176,429 208,845 264,595
Listing expenses(3) ................................................ 15,757 26,276 21,234
Adjusted net loss for the year (non-IFRS financial measure) ............ (183,205) (136,591) (168,382)
Notes:
(1) Share-based payment expenses to employees represent the arrangement whereby we receive services from employees as consideration
for our equity instruments. Such expenses are not expected to result in future cash payments.
(2) Finance cost of interest on redemption liabilities represents the non-cash, interest expense recorded to reflect interest incurred on our
conditional obligation to redeem equity securities issued in our previous financing of Series. This redemption obligation was initially
measured at net present value of the redemption obligation amount and recorded as a financial liability and incurred interest. We will not
incur such finance cost upon Listing.
(3) Listing expenses relate to our Global Offering.
DESCRIPTION OF MAJOR COMPONENTS OF OUR RESULTS OF OPERATIONS
Revenue
During the Track Record Period, we generated revenue primarily from offering AI products and
solutions for Daily Life and Healthcare. During the Track Record Period, we generated substantially all
of our revenue from the PRC.
301


--- page 311 ---
FINANCIAL INFORMATION
The following table sets out a breakdown of our revenue by streams in absolute amounts and as
a percentage of revenue for the years indicated:
Year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Revenue
Daily Life ..................................... 486,682 81.0 578,729 79.6 739,830 78.8
- Solutions ..................................... 393,197 65.5 475,230 65.3 622,534 66.3
- Technology services (1) ....................... 167,801 27.9 208,611 28.7 271,789 28.9
- Hotels ................................... 18,189 3.0 16,023 2.2 19,865 2.1
- Residences ................................ 60,341 10.0 38,143 5.2 20,307 2.2
- Commercial spaces ......................... 52,267 8.7 109,551 15.1 198,887 21.2
- Transportation ............................. 94,599 15.8 102,902 14.1 111,686 11.9
- Products ...................................... 93,485 15.5 103,499 14.3 117,296 12.5
Healthcare ..................................... 113,452 18.9 148,245 20.4 199,180 21.2
Others(2) ....................................... 4 8 5 0 . 1 3 4 2 - 7 -
Total ......................................... 600,619 100.0 727,316 100.0 939,017 100.0
Note:
(1) Technology services refer to services provided to enterprises across a wide range of industries, to them enhance their R&D and
management efficiency based on our AI technologies.
(2) Others primarily consist of revenue from leasing office premise and sales of certain electronic devices.
Daily Life
We offer AI products and solutions for AI solution in life scenarios such as residential,
commercial space, hospitality and transportation. We typically generate revenue from (i) sales of AI-
enhanced IoT solutions, and (ii) sales of AI products such as AI model embedded chips and modules,
as well as subscription fee for AI services such as speech recognition products.
Healthcare
We primarily generate revenue from sales of AI products and solutions, including efficiency
tools and medical quality management solutions, primarily to hospitals and insurance companies.
Others
We had insignificant revenue from leasing office premise and sales of certain electronic devices
during the Track Record Period.
The following table sets out a breakdown of our revenue by customer type in absolute amounts
and as a percentage of revenue for the years indicated:
Year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Enterprise customers ............................. 316,684 52.7 389,849 53.6 422,064 44.9
System integrators / Agents ....................... 283,935 47.3 337,467 46.4 516,953 55.1
Total ......................................... 600,619 100.0 727,316 100.0 939,017 100.0
302


--- page 312 ---
FINANCIAL INFORMATION
During the Track Record Period, the revenue contribution from Enterprise customers and
system integrators fluctuated. The choice between transacting directly with us or via system integrators
is made by the end users, and this preference can differ across various industries. For example, in the
public transportation industry, customers such as local railway companies have previously involved
system integrators for their infrastructure development initiatives. These system integrators, having
maintained their roles in operating, maintaining, and upgrading these systems over time, were typically
engaged to conduct the transactions with us.
Cost of Sales and Services
Our cost of sales and services primarily consists of: (i) cost of hardware; (ii) third-party service
fees for software development support and computing resources; (iii) employee benefit expenses
incurred for the deployment and maintenance personnel for AI solutions; and (iv) depreciation of
property, plant and equipment and right-of-use assets.
The following table sets forth a breakdown of our cost of sales and services by nature for the
years indicated:
Year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Cost of hardware ................................ 279,629 77.5 302,899 70.0 312,938 54.5
Third-party service fees ........................... 65,338 18.1 112,692 26.0 241,911 42.1
Employee benefit expenses ........................ 11,175 3.1 12,397 2.9 14,108 2.5
Depreciation ................................... 3,960 1.1 3,675 0.8 2,537 0.4
Others ........................................ 6 3 0 0 . 2 1,145 0.3 3,043 0.5
Total ......................................... 360,732 100.0 432,808 100.0 574,537 100.0
During the Track Record Period, we incurred cost of hardware mainly relating to the
consumption of (i) raw materials for our AI products, such as AI chips, modules and other hardware
devices and components, (ii) intelligent devices, such as multi-modal interactive devices and central
control devices, for our AI solutions, and (iii) hardware components for Healthcare solutions to
incorporate with our voice control software. For example, in response to our customers’ specific
requirements for medical efficiency tools, we procure ultrasound equipment, incorporate it with voice-
command software, and offer our customers with voice-operated ultrasound equipment control systems
and graphic workstations for ultrasound reports.
We incurred third-party service fees on a project basis mainly for (i) the development of user
interface, application platforms, and application software, tailored to the unique requirements of the
customer, and (ii) data processing and system integration services; for example, to facilitate application
operations based on the data generated by the hospital’s information system, we may delegate a third
party to integrate our medical record quality control system software with the existing data system of
the hospital. During the Track Record Period, we had an overall increase in the third-party service fees
primarily due to growing demand for project-related applications as non-core development work, to
facilitate the delivery of a growing number of projects as our business expanded.
Gross Profit and Gross Profit Margin
During the Track Record Period, we had gross profit of RMB239.9 million, RMB294.5 million,
and RMB364.5 million in 2022, 2023 and 2024, respectively. Our gross profit margin amounted to
303


--- page 313 ---
FINANCIAL INFORMATION
39.9%, 40.5%, and 38.8% in 2022, 2023 and 2024, respectively. The fluctuations in our gross profit
margin were mainly in relation to the procurement of hardware components and other devices as well
as third-party services to support our products and solutions.
Research and Development Expenses
Our R&D expenses primarily consist of (i) employee benefit expenses incurred for R&D staff;
(ii) third-party service fees paid to contractors who provided certain general technology development
support; and (iii) server costs and cloud-based service fees.
To improve R&D efficiency and allow our R&D staff to focus on the development of core AI
models and technologies, we outsourced certain non-essential R&D tasks to third-party contractors.
We normally outsource research and development activities that require a large amount of manpower
but are not sophisticated or critical to our AI products and solutions, which typically include
development of support modules for UniBrain, data annotation, testing and packaging. For Daily Life
solutions, we mainly outsource software development work related to specific application scenarios,
such as user interface design and application software development. For Healthcare solutions, we
usually outsource the development of management and application platforms for different scenarios
based on our proprietary knowledge graph. We cooperate with companies that are experienced in AI
application software development with in-depth experience in the specific industry. We own all
copyrights related to the R&D projects, including technical materials, documents, source codes, and
applications. Additionally, we engage third-party service providers to annotate the vast amount of data
we use to train our models and improve our technologies. The fees for these services are based on the
volume of data processed or labeled. During the Track Record Period, we incurred third-party service
fees for software development work of RMB129.6 million, RMB124.6 million, RMB170.6 million in
2022, 2023 and 2024, respectively, and RMB17.6 million, RMB19.3 million, and RMB39.5 million for
data processing services during the same years. The increase in third-party service fees for both
software development and data processing services in 2022 was primarily because we expanded our AI
solution offerings in a wider range of industry verticals, which required an increase in development
work relating to interface and application software as well as growing need for data to train new
models. Benefiting from such investments, we had a decrease in third-party service fees in 2023 by
continuing to use these application software and models. In 2024, we had an increase in third-party
service fees mainly attributable to upgrades and iterations of the existing solutions. See “Year-to-Year
Comparison of Results of Operations” for details.
The following table sets out a breakdown of our R&D expenses for the years indicated:
Year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Employee benefit expenses .......................... 116,293 40.5 109,844 38.4 116,275 31.4
Third-party service fees ............................. 147,266 51.3 143,906 50.3 210,146 56.8
Depreciation ...................................... 12,218 4.3 9,831 3.4 10,001 2.7
Server costs and cloud-based service fees ............... 6,856 2.4 13,338 4.7 27,917 7.5
Share-based payment expenses ....................... — — 4,000 1.4 — 0.0
Other expenses(1) .................................. 4,466 1.5 5,382 1.9 5,735 1.5
Total ............................................ 287,099 100.0 286,301 100.0 370,073 100.0
Note:
(1) Other expenses mainly include travel expenses, property management fees and utilities.
304


--- page 314 ---
FINANCIAL INFORMATION
Selling and Marketing Expenses
Our selling and marketing expenses primarily include (i) employee benefit expenses incurred
for sales and marketing staff; (ii) marketing and promotional expenses incurred for exhibitions,
conferences and other promotional activities; (iii) depreciation; and (iv) third-party service fees and
other consulting fees incurred with third-party contractors for marketing and pre-sales support. The
following table sets out a breakdown of our selling and marketing expenses for the years indicated:
Year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Employee benefit expenses ............................. 27,021 58.6 32,514 55.3 33,952 48.0
Marketing and promotional expenses ..................... 12,950 28.1 18,534 31.5 22,806 32.3
Depreciation ........................................ 2,908 6.3 3,390 5.8 9,436 13.3
Third-party service fees and other consulting fees ........... 1,459 3.2 537 0.9 416 0.6
Share-based payment expenses .......................... — — 5 3 2 0 . 9 — 0 . 0
Other expenses ....................................... 1,748 3.8 3,303 5.6 4,095 5.8
Total .............................................. 46,086 100.0 58,810 100.0 70,705 100.0
Administrative Expenses
Our administrative expenses primarily consist of (i) employee benefit expenses incurred for
general administration staff; (ii) share-based payment expenses incurred in relation to the grant of
preferred rights to certain pre-IPO investors, which ceased to be effective when we submitted the
listing application subject to certain conditions; (iii) professional fees primarily in relation to legal
services; and (iv) listing expenses.
The following table sets out a breakdown of our administrative expenses for the years
indicated:
Year ended December 31,
2022 2023 2024
Amount % Amount % Amount %
(RMB in thousands, except for percentages)
Employee benefit expenses .......................... 18,714 38.6 20,240 31.1 22,607 35.3
Professional fees ................................... 2,608 5.4 4,953 7.6 4,102 6.4
Listing expenses ................................... 15,757 32.5 26,276 40.4 21,234 33.1
Depreciation ...................................... 2,781 5.7 2,703 4.2 3,874 6.0
Office expenses .................................... 1,863 3.8 2,208 3.4 2,444 3.8
Taxes and surcharges ............................... 2,560 5.3 2,731 4.2 3,682 5.7
Auditor’s remuneration .............................. 7 7 3 1 . 6 5 6 8 0 . 9 4 2 3 0 . 7
Other expenses(1) ................................... 3,364 7.1 5,341 8.2 5,739 9.0
Total ............................................ 48,420 100.0 65,020 100.0 64,105 100.0
Note:
(1) Other expenses primarily represent business entertainment expenses, travel expenses and utility expenses.
305


--- page 315 ---
FINANCIAL INFORMATION
Net Impairment Losses on Financial Assets and Contract Assets
Our net impairment losses on financial assets and contract assets primarily represent the
provision for impairment on trade receivables and contract assets. The following table sets out a
breakdown of our net impairment losses on financial assets and contract assets for the years indicated:
Year ended December 31,
2022 2023 2024
(RMB in thousands)
Impairment (losses)/gains on trade receivables and contract assets ............. (72,051) (91,391) (48,383)
Impairment (losses)/gains on other receivables and financial lease receivables .... 7 5 4 5 ( 5 5 )
Total net impairment losses on financial assets and contract assets .......... (71,976) (91,346) (48,438)
Other Income
Our other income mainly represents government grants to encourage technology development
and compensate our expenditure in R&D activities, value-added tax (VAT) refund and deduction. The
following table sets out a breakdown of our other income for the years indicated:
Year ended December 31,
2022 2023 2024
(RMB in thousands)
Government grants ..................................................... 13,241 32,749 16,084
VAT refund and VAT super-deduction ..................................... 2,328 3,382 809
Others ............................................................... 1 7 7 1 8 2 1 8 4
Total ................................................................ 15,746 36,313 17,077
Other (Losses)/Gains, Net
Our net other (losses)/gains primarily consist of (i) net fair value gains on financial assets at fair
value through profit or loss, representing the gains or losses on our equity investments in unlisted AI
companies and investments in wealth management products; (ii) net fair value (losses)/gains on
financial liabilities at fair value through profit or loss; (iii) impairment of an associate; and (iv) other
items.
The following table sets out a breakdown of net other (losses)/gains in absolute amounts for the
years indicated:
Year ended December 31,
2022 2023 2024
(RMB in thousands)
Net fair value (losses)/gains on financial assets at fair value through profit or loss . . . (347) 12,018 (7,495)
Net fair value (losses)/gains on financial liabilities at fair value through profit or
loss ............................................................... (35) (731) 13
Financial subleasing related income ....................................... 3 3 4 1 7 1 2 2 2
Potential loss on investments accounted for using the equity method (1) ............ — — (4,900)
Other items .......................................................... (1,315) (879) (1,804)
Total ............................................................... (1,363) 10,579 (13,964)
Note:
(1) Potential loss on investments accounted for using the equity method represents our potential loss from subscribed capital contributions to
an associate operating in the AI industry.
306


--- page 316 ---
FINANCIAL INFORMATION
Finance Costs, Net
Our net finance costs mainly represent the difference between finance income and finance
costs. Our finance income represents interest income on current deposits and our finance costs include
(i) interest on redemption liabilities in relation to the preferred rights granted to certain investors, see
“History, Development and Corporate Structure — Pre-IPO Investments”; (ii) interest on bank
borrowings; and (iii) interest expenses for lease liabilities.
The following table sets out a breakdown of our finance income, finance costs and net finance
costs in absolute amounts for the years indicated:
Year ended December 31,
2022 2023 2024
(RMB in thousands)
Finance income
Interest income from bank deposits ................................... 3 1 4 1,875 2,298
Finance costs
Interest expenses on redemption liabilities ............................. (176,429) (208,845) (264,595)
Interest expenses on bank borrowings ................................. ( 340) (2,808) (5,323)
Interest expenses on lease liabilities .................................. ( 906) (731) (1,020)
Interest expenses on borrowing from sales and leaseback .................. — (386) (5)
Finance costs - net ............................................... (177,361) (210,895) (268,645)
Share of profit/(loss) from investments accounted for using the equity method
We had share of profit from investments accounted for using the equity method of RMB1.1
million in 2022, share of loss from investments accounted for using the equity method of
RMB2.6 million in 2023, representing our share of profit from our associates which operate in the AI
industry. We hold between 20% and 50% of the voting rights of these associates, and are considered to
have significant influence but not control over these associates. We did not have share of profit or loss
from such investments in 2024, as its carrying amount has decreased to nil. See Note 13 to the
Accountant’s Report in Appendix I to this prospectus.
Income Tax Expense
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.
The table below sets forth a breakdown of our income tax (credit)/expense for the years
indicated:
Year ended
December 31,
2022 2023 2024
( RMB in thousands)
Current tax ................................................................ 3 3 2,309 80
Deferred income tax (credit)/expense ........................................... ( 222) 346 (242)
Income tax (credit)/expense .................................................. (189) 2,655 (162)
307


--- page 317 ---
FINANCIAL INFORMATION
Hong Kong
Subsidiary incorporated in Hong Kong is subject to Hong Kong profits tax of which the tax rate
is 8.25% on assessable profits up to HKD2.0 million, and 16.5% on any part of assessable profits over
HKD2.0 million for the Track Record Period.
PRC
Our income tax provision in respect of our operations in the PRC was subject to a statutory tax
rate of 25% on the assessable profits for the Track Record Period, based on the existing legislation,
interpretations and practices in respect thereof.
The Company, Shenzhen Unisound and Shanghai Unisound were qualified as High and New
Technology Enterprises under the relevant PRC laws and regulations. Accordingly, these entities were
entitled to a preferential income tax rate of 15% during the Track Record Period. This status is subject
to a requirement that the Company, Shenzhen Unisound and Shanghai Unisound shall reapply for the
status of High and New Technology Enterprises every three years.
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.
YEAR-TO-YEAR COMPARISON OF RESULTS OF OPERATIONS
Year ended December 31, 2024 compared to year ended December 31, 2023
Revenue
Our total revenue increased by 29.1% from RMB727.3 million in 2023 to RMB939.0 million in
2024, attributable to the revenue growth in both Daily Life and Healthcare.
Daily Life
Our revenue from Daily Life increased by 27.8% from RMB578.7 million in 2023 to
RMB739.8 million in 2024, primarily driven by our expanded AI solution offerings, particularly our
smart park solutions with advanced carbon reduction capabilities, as well as our AI technology
services.
Healthcare
Our revenue from Healthcare increased by 34.4% from RMB148.2 million in 2023 to
RMB199.2 million in 2024, primarily driven by the increase in both customer spending and the
number of projects for clinical decision support systems, as we enhanced our solutions and expanded
functions, while enabling rapid deployment across new business scenarios through our UniGPT
capabilities.
Cost of sales and services
Our cost of sales and services increased by 32.7% from RMB432.8 million in 2023 to
RMB574.5 million in 2024. The increase in third-party service fees was primarily driven by growing
demand for customized application development services related to specific project implementation,
308


--- page 318 ---
FINANCIAL INFORMATION
such as UI design, interface development, and other client-specific customizations based on our
standard products. As our business scale expanded, we chose to outsource these non-core development
tasks to optimize costs and improve project delivery efficiency.
Gross profit and gross profit margin
As a result of foregoing, our gross profit increased by 23.8% from RMB294.5 million in 2023
to RMB364.5 million in 2024. Our gross profit margin slightly decreased from 40.5% in 2023 to
38.8% in 2024, primarily due to (i) an increase in procurement of hardware components, advanced
computing and storage devices, to support our integrated hardware-software AI technology services,
and (ii) we expanded our AI chips portfolio to offer more affordable products in line with the market
demands.
Research and development expenses
Our research and development expenses increased by 29.3% from RMB286.3 million in 2023
to RMB370.1 million in 2024, primarily due to (i) an increase in the third-party service fees for
developing application software across new scenarios and upgrading existing products, being non-core
R&D activities, and (ii) an increase in the server costs and cloud-based service fees due to increased
needs for computing services.
Selling and marketing expenses
Our selling and marketing expenses increased by 20.2% from RMB58.8 million in 2023 to
RMB70.7 million in 2024, primarily due to an increase in the depreciation expenses in relation to our
newly established exhibition halls for sales activities and increase in marketing and promotion
expenses as a result of increase in sales and marketing activities to support our expanding business
operations.
Administrative expenses
Our administrative expenses decreased by 1.4% from RMB65.0 million in 2023 to
RMB64.1 million in 2024, primarily attributable to the decrease in listing expenses.
Net impairment losses on financial assets and contract assets
Our net impairment loss on financial assets and contract assets decreased from RMB91.3
million in 2023 to RMB48.4 million in 2024, which primarily represented the decrease in provision for
aging trade receivables. The decrease was primarily due to a lower expected credit loss rate,
attributable to our improved collection results.
Other income
Our other income decreased from RMB36.3 million in 2023 to RMB17.1 million in 2024,
primarily in relation to the government grants obtained for our R&D projects.
Other (losses)/gains, net
We had other net gains of RMB10.6 million in 2023 and other net losses of RMB14.0 million
in 2024, primarily due to changes in the net fair value gains on financial assets at fair value through
profit or loss related to equity investment in unlisted AI companies, as well as potential loss on
investments accounted for using the equity method.
309


--- page 319 ---
FINANCIAL INFORMATION
Finance costs, net
Our net finance costs increased from RMB210.9 million in 2023 to RMB268.6 million in 2024,
primarily due to an increase in our finance costs by 27.3% from RMB212.8 million in 2023 to
RMB270.9 million in 2024. This was mainly attributable to an increase in interest expense on
redemption liabilities in relation to the preferred rights granted to investors. See “History,
Development and Corporate Structure—Pre-IPO Investments.”
Share of profit/(loss) from investments accounted for using the equity method
We did not have share of profit or loss from such investments in 2024, as the carrying amount
had decreased to nil.
Income tax expense
We had income tax expense of RMB2.7 million in 2023 and income tax credit of RMB0.2
million in 2024, primarily representing the accumulated deductible income tax credits.
Profit/Loss for the Year
As a result of the foregoing, our loss increased by 20.7% from loss of RMB376.2 million in
2023 to loss of RMB454.2 million in 2024.
Year ended December 31, 2023 compared to year ended December 31, 2022
Revenue
Our total revenue increased by 21.1% from RMB600.6 million in 2022 to RMB727.3 million in
2023.
Daily Life
Our revenue from Daily Life increased by 18.9% from RMB486.7 million in 2022 to
RMB578.7 million in 2023, primarily driven by our expanded AI solution offerings, especially in
industry verticals such as smart park, and the increased sales of AI chips for IoT devices.
Healthcare
Our revenue from Healthcare increased by 30.6% from RMB113.5 million in 2022 to
RMB148.2 million in 2023, primarily driven by a growing demand for efficiency tools and clinical
decision support systems in line with the industry trend of intelligence upgrade of internal systems
among hospitals.
Cost of sales and services
Our cost of sales and services increased by 20.0% from RMB360.7 million in 2022 to
RMB432.8 million in 2023, primarily due to increases in cost of hardware and third-party service fees
for software development support and computing that facilitated the delivery of projects.
310


--- page 320 ---
FINANCIAL INFORMATION
Gross profit and gross profit margin
As a result of the foregoing, our gross profit increased from RMB239.9 million in 2022 to
RMB294.5 million in 2023. Our gross profit margin remained relatively stable, being 39.9% in 2022
and 40.5% in 2023.
Research and development expenses
Our research and development expenses slightly decreased by 0.3% from RMB287.1 million in
2022 to RMB286.3 million in 2023, benefiting from the improved efficiency brought by our previous
investment in core technologies.
Selling and marketing expenses
Our selling and marketing expenses increased by 27.5% from RMB46.1 million in 2022 to
RMB58.8 million in 2023, primarily attributable to an increase in sales and marketing activities to
support our expanding business operations.
Administrative expenses
Our administrative expenses increased by 34.3% from RMB48.4 million in 2022 to RMB65.0
million in 2023, primarily due to an increase in listing expenses.
Net impairment losses on financial assets and contract assets
Our net impairment loss on financial assets and contract assets increased from RMB72.0
million in 2022 to RMB91.3 million in 2023. Our net impairment loss on financial assets and contract
assets in 2023 primarily represent the provision for aging trade receivables.
Other income
Our other income increased significantly from RMB15.7 million in 2022 to RMB36.3 million
in 2023, primarily attributable to the government grants for our R&D projects.
Other (losses)/gains, net
We had other net gains of RMB10.6 million in 2023 as compared to other net losses of
RMB1.4 million in 2022, primarily attributable to an increase in the net fair value gains on financial
assets at fair value through profit or loss related to equity investment in unlisted AI companies.
Finance costs, net
Our net finance costs increased from RMB177.4 million in 2022 to RMB210.9 million in 2023,
primarily due to an increase in our finance costs by 19.8% from RMB177.7 million in 2022 to
RMB212.8 million in 2023. This was mainly attributable to an increase in interest expense on
redemption liabilities in relation to the preferred rights granted to investors. See “History,
Development and Corporate Structure — Pre-IPO Investments.”
Share of profit/(loss) from investments accounted for using the equity method
We had share of loss from investments in associates amounting to RMB2.6 million in 2023, as
compared to share of profit of RMB1.1 million in 2022, primarily attributable to losses from an
associate we invested in.
311


--- page 321 ---
FINANCIAL INFORMATION
Income tax expense
We had income tax expenses of RMB2.7 million in 2023 and income tax credit of RMB0.2
million in 2022.
Loss for the year
As a result of the foregoing, our loss for the year increased by 0.2% from RMB375.4 million in
2022 to RMB376.2 million in 2023.
DISCUSSION OF CERTAIN KEY BALANCE SHEET ITEMS
Non-current Assets and Liabilities
The following table sets out our non-current assets and liabilities as of the dates indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Non-current assets
Property, plant and equipment .................................. 14,533 19,160 28,081
Right-of-use assets ........................................... 12,422 8,645 10,385
Intangible assets ............................................. 5 6 0 4 9 8 8,791
Deferred income tax assets ..................................... 3 9 9 5 3 2 9 5
Investments accounted for using the equity method .................. 2,617 — —
Financial assets at fair value through profit or loss .................. 21,680 30,588 24,347
Financial lease receivables ..................................... 6 7 0 — 3,725
Other non-current assets ....................................... — 47,393 47,393
Total non-current assets ...................................... 52,881 106,337 123,017
Non-current liabilities
Lease liabilities .............................................. 4,372 4,685 7,583
Redemption liabilities ......................................... 2,108,990 3,038,456 3,303,051
Other non-current liabilities .................................... 45,033 26,434 29,625
Total non-current liabilities ................................... 2,158,395 3,069,575 3,340,259
Net non-current assets/liabilities ............................... (2,105,514) (2,963,238) (3,217,242)
Property, Plant and Equipment
Our property, plant and equipment primarily comprised of servers, office equipment, testing
equipment, and leasehold improvement.
As of December 31, 2022, 2023 and 2024, the balance of our property, plant and equipment
was RMB14.5 million, RMB19.2 million and RMB28.1 million, respectively. The increase in the
balance of our property, plant and equipment as of December 31, 2023 compared to December 31,
2022 was primarily due to acquisition of servers and computers. The increase in the balance of our
property, plant and equipment as of December 31, 2024 compared to December 31, 2023 was primarily
due to leasehold improvement in relation to our newly established exhibition halls, as well as the
acquisition of servers, displays and computers.
Right-of-use Assets
Our right-of-use assets primarily represent leasehold office premises. As of December 31,
2022, 2023 and 2024, the balance of our right-of-use assets was RMB12.4 million, RMB8.6 million
312


--- page 322 ---
FINANCIAL INFORMATION
and RMB10.4 million, respectively. The decrease in the balance of our right-of-use assets as of
December 31, 2023 compared to December 31, 2022 was primarily due to termination of certain
office leases. The increase in the balance of our right-of-use assets as of December 31, 2024
compared to December 31, 2023 primarily represented our new and renewal of office leases.
Investments Accounted for Using the Equity Method
We record our investments in associates using the equity method. As of December 31, 2022,
2023 and 2024, the balance of our investments accounted for using the equity method was
RMB2.6 million, nil and nil, respectively. The decrease in the balance as of December 31, 2023
compared to December 31, 2022 was primarily due to the losses of Shanghai Maosheng Intelligence
Technology Co., Ltd in 2023. The balance as of December 31, 2024 remained unchanged, reflecting
the accumulated losses. See Note 13 to the Accountant’s Report in Appendix I to this prospectus.
Financial Assets at Fair Value through Profit or Loss
Our financial assets at fair value through profit or loss recorded as non-current assets
represented equity investments at fair value in unlisted AI companies. Our financial assets at fair value
through profit or loss recorded as current assets represented investments in wealth management
products purchased from state-owned or international financial institutions in the PRC, primarily
consisting of fixed income instruments, structured deposits and open-end non-principal-guaranteed
wealth management products. The annual return rate of our wealth management products was 1.17%-
2.83% and 1.05%-2.65% in 2023 and 2024, respectively, for structured deposits and 1.23%-2.37% in
2023 for open-end non-principal-guaranteed products. See Note 25 to the Accountant’s Report in
Appendix I to this prospectus.
The following table sets forth our financial assets at fair value through profit or loss as of the
dates indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Non-current assets
Unlisted equity investments .............................................. 21,680 30,588 24,347
Current assets
Investment in wealth management products ................................. — 69,010 —
Total ................................................................ 21,680 99,598 24,347
The balance of our non-current financial assets at fair value through profit or loss increased
from RMB21.7 million as of December 31, 2022, to RMB30.6 million as of December 31, 2023 and
decreased to RMB24.3 million as of 2024, primarily due to the overall valuation change of the investee
companies. As of December 31, 2024, our unlisted equity investments mainly included (i) investment
in Shenzhen Tongxingzhe Technology Co., Ltd, a provider for vehicle intelligent voice interaction
solutions operated on Internet of Vehicles platform, with fair value of RMB20.9 million; (ii)
investment in Anhui Xinzhi Technology Co., Ltd., a developer for automotive-grade chips and cockpit
software for voice interactions, with fair value of RMB1.1 million; and (iii) investment in Shenzhen
Beiyu Information Technology Co., Ltd., a provider of IoT products, with fair value of
RMB59.5 thousand. We make investments in AI companies in accordance with our business
development strategy to establish a presence in the interconnected sectors such as Internet of Vehicles,
automotive chips, and IoT, which help us expand the use cases for our products.
313


--- page 323 ---
FINANCIAL INFORMATION
The balance of our current financial assets at fair value through profit or loss increased from nil
as of December 31, 2022 to RMB69.0 million as of December 31, 2023 as we purchased wealth
management products mainly comprising (i) structured deposit of RMB50.0 million with China CITIC
Bank, (ii) structured deposit of RMB10.0 million with China Minsheng Bank, and (iii) open-end non-
principal guaranteed product of RMB9.0 million issues by ICBC. The balance of our current financial
assets at fair value through profit or loss decreased from RMB69.0 million as of December 31, 2023 to
nil as of 2024, as we redeemed the wealth management products.
We monitor and control the investment risks with a comprehensive set of internal policies and
guidelines to manage our investments. Our Board determines our investment strategies. Our
investment strategy related to wealth management products focuses on minimizing the financial risks
by reasonably matching the maturities of the portfolio to anticipated operating cash needs, while
generating desirable investment returns. To control our risk exposure, we make investment decisions
related to wealth management products after thoroughly considering a number of factors, including but
not limited to macro-economic environment, general market conditions, risk control and credit of
issuing financial institutions, our own working capital conditions, and the expected profit or potential
loss of the investment. Our finance department is responsible for proposing, analyzing and evaluating
potential investment in such products comprehensively. Prior to making any material investments in
wealth management products or modifying our existing investment portfolio, the proposal shall be
reviewed and approved by our chief executive officer, chief financial officer and financial manager
jointly. Our chief cashier is responsible for establishing asset register of wealth management products
and prepare weekly asset report for daily maintenance, and our chief financial officer and financial
manager shall promptly manage the wealth management products in accordance with such asset
register and weekly asset report. Our management, including our finance department, has extensive
experience in managing the financial aspects of enterprise’s operations. The investment in financial
assets at fair value through profit or loss after the Listing will be subject to the compliance with
Chapter 14 of the Listing Rules.
Redemption Liabilities
Pursuant to the Shareholders Agreement, our Pre-IPO Investors had been granted redemption
rights to require us to repurchase our equity instruments. We recognize such obligation to repurchase as
redemption liabilities, which are initially measured at present value of the expected cash flows for settling
the related obligations and subsequently measured at amortized cost. As a result, we had redemption
liabilities of RMB2,109.0 million, RMB3,038.5 and RMB3,303.1 million as of December 31, 2022, 2023
and 2024, respectively. Pursuant to the Shareholder Agreement, all the special rights of the Pre-IPO
Investors ceased to be effective when we submitted the listing application to the Stock Exchange, subject
to certain conditions. See “History, Development and Corporate Structure – Pre-IPO investments” and
Note 30 to the Accountant’s Report in Appendix I to this prospectus.
314


--- page 324 ---
FINANCIAL INFORMATION
Current Assets and Liabilities
The following table sets out our current assets and liabilities as of the dates indicated:
As of December 31,
As of
April 30
2022 2023 2024 2025
(RMB in thousands)
(unaudited)
Current Assets
Inventories ............................................... 33,614 67,853 140,292 168,418
Contract assets ............................................ 3,908 4,123 4,969 6,635
Trade receivables .......................................... 368,860 411,053 559,242 459,594
Prepayments and other receivables ............................ 32,170 66,256 89,530 153,854
Financial assets at fair value through profit or loss ................ — 69,010 — —
Financial lease receivables .................................. 3,293 750 2,909 3,016
Cash and cash equivalents ................................... 74,118 379,224 156,476 116,646
Restricted cash ............................................ — — 3,541 3,015
Total current assets ....................................... 515,963 998,269 956,959 911,178
Current liabilities
Trade and other payables .................................... 192,782 181,455 232,895 212,042
Contract liabilities ......................................... 55,877 64,804 86,265 106,250
Salary and welfare payable .................................. 22,966 15,233 15,052 13,671
Borrowings .............................................. 35,000 65,000 145,378 133,092
Financial liabilities at fair value through profit or loss ............. 6 6 7 2,383 2,370 2,370
Lease liabilities ........................................... 14,395 4,913 10,665 11,128
Total current liabilities .................................... 321,687 333,788 492,625 478,552
Net current assets ........................................ 194,276 664,481 464,334 432,626
Our net current assets decreased from RMB664.5 million as of December 31, 2023 to
RMB464.3 million as of December 31, 2024, mainly reflecting (i) a decrease in the cash and cash
equivalents in relation to our cash outflow to support business operations and (ii) an increase in the
borrowings, partially offset by an increase in the trade receivables. Our net current assets increased
from RMB194.3 million as of December 31, 2022 to RMB664.5 million as of December 31, 2023,
primarily due to an increase in total current assets from RMB516.0 million to RMB998.3 million,
mainly reflecting (i) an increase in financial assets at fair value through profit or loss due to purchase
of wealth management products, and (ii) an increase incash and cash equivalents as we completed the
Series D3 financing in 2023.
315


--- page 325 ---
FINANCIAL INFORMATION
Inventories
Our inventories primarily include (i) purchased hardware and software, mainly including AI
chips, modules, devices and support software, and (ii) contract fulfillment cost including staff costs,
software and hardware procurement costs, and travel expenses for the development of AI solution that
will be recognized as revenue once our customers accept delivery. Our contract fulfillment period,
depending on the complexity of products and solutions we offer, typically ranges from one to six
months. The following table sets forth our inventories as of the dates indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Purchased hardware and software ........................................ 23,333 23,301 28,435
Contract fulfillment cost ............................................... 17,056 53,021 119,339
Less: allowance for impairment of inventories .............................. (6,775) (8,469) (7,482)
Total ............................................................... 33,614 67,853 140,292
Our inventory balance increased from RMB33.6 million as of December 31, 2022, to RMB67.9
million as of December 31, 2023 and further increased to RMB140.3 million as of December 31, 2024.
The increase in inventory balance mainly reflect the changes in contract fulfillment cost, arising from
certain major solution projects that had not yet been delivered by the year end. These projects are
mainly under our Daily Life solutions business, with relevant enterprise customers or system
integrators primarily operating in technology industries. These projects generally have a longer
delivery period, where revenue is only recognized when certain milestone acceptance standards are
met. As a result, during the execution process of these projects, we tend to carry substantial contract
fulfillment cost.
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.
During the Track Record Period, we experienced increased inventory turnover days, which are 46
days, 49 days and 71 days in 2022, 2023 and 2024, respectively, and experienced fluctuations in the
balance of inventories aged six months to one year, which amounted to RMB5.7 million,
RMB3.7 million and RMB24.0 million as of December 31, 2022, 2023 and 2024. The significant
increase in turnover days of 2024 and inventory balance aged six months to one year as of
December 31, 2024 were mainly related to an increase in contract fulfillment costs primarily reflecting
ongoing deliveries for large-scale public transit projects for public sector end-users where customer
acceptance and payment occur only upon final project completion. We consider the risk of inventory
recovery between six months to one year to be relatively low, as the contract fulfillment costs are all in
relation to profitable contracts with acceptable margin that are progressing normally and are expected
to be completed by the end of 2025, subject to the actual construction progress of the specific project.
During the Track Record Period, we experienced fluctuations in the balance of inventories aged more
than one year, which amounted to RMB21.2 million, RMB16.6 million and RMB18.0 million as of
December 31, 2022, 2023 and 2024. Meanwhile, we had allowance for impairment of inventories of
RMB6.8 million, RMB8.5 million and RMB7.5 million as of December 31, 2022, 2023 and 2024,
respectively, mainly related to purchased hardware and software. We consider the risk of inventory
recovery over one year is relatively low, and that we have made sufficient provision, since (i) we
procured general-use inventory items including chips, microphones, and screens in bulk from suppliers
for future sales and post-sale maintenance, which have a relatively long shelf life, are generally
maintained in good condition to be gradually consumed through ongoing contracts; (ii) during the
316


--- page 326 ---
FINANCIAL INFORMATION
Track Record Period, we strategically procured specific-use inventories, such as chip modules, in
anticipation of certain business scenarios while exploring business opportunities. We had adjusted our
procurement strategy to reduce stock levels and mitigate the risk of inventory losses as market
conditions and availability of chip modules have improved; and (iii) during the Track Record Period,
we experienced an inventory backlog due to the effects of COVID-19, which we plan to consume over
time. On the other hand, as almost all of the balances of contract fulfillment costs were related to
ongoing projects not being delivered to and accepted by the customers yet due to the projects process,
we expected that the contract amounts could be recovered upon delivery and acceptance and
determined that the net realizable value of those contract fulfillment costs was higher than their related
incurred and expected costs, therefore no provision was made for most of the contract fulfillment costs.
The following table sets forth an aging analysis of our inventories as of the dates indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Up to 3 months ....................................................... 12,841 50,735 88,955
3 to 6 months ........................................................ 6 2 6 5,224 16,836
6 months to 1 year .................................................... 5,687 3,721 24,028
Over 1 year .......................................................... 21,235 16,642 17,955
Less: allowance for impairment of inventories .......................... (6,775) (8,469) (7,482)
Total ............................................................... 33,614 67,853 140,292
The following table sets forth the turnover days of our inventories for the years indicated:
Year ended December 31,
2022 2023 2024
Inventory turnover days (1) .................................................. 4 6 4 9 7 1
Note:
(1) Inventory turnover days for a period equals the average of the gross value of the opening and closing inventories balance divided by cost
of sales for the relevant period and multiplied by the number of days in the relevant period, which is 365 days for each year.
Our inventory turnover days remained relatively stable during the Track Record Period at 46
days, 49 days and 71 days in 2022, 2023 and 2024, respectively. The increases in turnover days in
2023 and 2024 were primarily due to an increase in contract fulfillment cost primarily reflecting
ongoing deliveries for large-scale public transit projects for public sector end-users where customer
acceptance and payment occur only upon final project completion. These projects are expected to be
completed by the end of 2025, subject to the actual construction progress of the specific project.
As of April 30, 2025, RMB50.2 million, or approximately 34.0%, of our inventories as of
December 31, 2024 had been delivered or consumed, demonstrating substantial improvement as
compared to 17.4% as of February 28, 2025.
Contract Assets
Contract assets are recognized if our right to receive contractual payment is conditional upon
factors including end user payment and completion of warranty period. See Note 6 to the Accountant’s
Report in Appendix I to this prospectus. As of December 31, 2022, 2023 and 2024, the balance of our
contract assets was RMB3.9 million, RMB4.1 million and RMB5.0 million, respectively.
317


--- page 327 ---
FINANCIAL INFORMATION
The following table sets out a breakdown of our contract assets as of the date indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Daily Life .............................................................. 1,834 3,593 3,265
Healthcare ............................................................. 3,091 1,764 2,482
Less: allowance for impairment of contract assets .............................. (1,017) (1,234) (778)
Total ................................................................. 3,908 4,123 4,969
As of April 30, 2025, RMB0.1 million, or approximately 2.3% of our contract assets as of
December 31, 2024 had been certified.
Trade Receivables
Our trade receivables are amounts due from customers for products sold and services we
performed in the ordinary course of business.
As of December 31,
2022 2023 2024
(RMB in thousands)
Expected credit loss rate ............................................ 27.2% 34.0% 30.1%
Trade receivables ................................................. 506,410 623,179 800,492
Less: allowance for impairment of trade receivables ...................... (137,550) (212,126) (241,250)
Total ........................................................... 368,860 411,053 559,242
As of December 31, 2022, 2023 and 2024, our trade receivables were RMB368.9 million,
RMB411.1 million and RMB559.2 million, respectively. The increase in our trade receivables as of
December 31, 2022, 2023 and 2024 were generally in line with our revenue growth.
We decide trading terms with our customers on a case-by-case basis. The credit terms given to
our trade customers are determined on an individual basis with normal credit period mainly within 180
days. The following table sets forth an aging analysis of our trade receivables as of the dates indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Up to 1 year ....................................................... 323,966 414,111 563,196
1 to 2 years ........................................................ 133,944 108,459 121,264
More than 2 years ................................................... 48,500 100,609 116,032
Total ............................................................. 506,410 623,179 800,492
Due to the general market condition and increased market competition, certain of our customers
from both public and private sectors experienced a slowdown in operational capital turnover, and their
internal payment approval processes have lengthened. As of December 31, 2024, we had outstanding
balance of trade receivables of RMB800.5 million, with approximately RMB237.3 million aged over
one year. The increase in the balance of trade receivable aged over two years, resulting from a
combination of uncollected long-aged trade receivables as of December 31, 2024, and receivables that
aged one to two years as of December 31, 2023 that remained uncollected in 2024, was primarily due
to the delay relating to the collection with a number of customers who, facing certain financial
318


--- page 328 ---
FINANCIAL INFORMATION
hardships, are experiencing a slower recovery. For example, certain of our public sector customers
faced extended budget constraints during the pandemic, which subsequently impacted their capacity to
settle the historical receivables with us; additionally, some private sector customers in the real estate
industry had extended their payment schedules due to the overall downturn in the industry. However,
with shifts in real estate policies and the economy entering a recovery period after the pandemic, we
expect an improvement in the payment collection. We performed an impairment assessment at the end
of each of the year within the Track Record Period and made provision of RMB171.4 million for trade
receivables aged over one year as of December 31, 2024.
The following table sets forth an aging analysis of our trade receivables as of the dates
indicated by customer type:
As of December 31,
2022 2023 2024
Public
sector
Private
sector
Public
sector
Private
sector
Public
sector
Private
sector
(RMB in thousands)
Up to 1 year .............................. 221,359 102,607 271,375 142,736 324,048 239,148
1 to 2 years .............................. 51,764 82,180 78,218 30,241 105,207 16,057
More than 2 years ......................... 18,131 30,369 46,079 54,530 72,056 43,976
Total ................................... 291,254 215,156 395,672 227,507 501,311 299,181
The following table sets forth the turnover days of our trade receivables for the years indicated:
Year ended December 31,
2022 2023 2024
Trade receivables turnover days (1) ............................................ 2 5 4 2 8 3 2 7 7
Note:
(1) Trade receivables turnover days for a period equals the average of the gross value of the opening and closing trade and bills receivables
balance divided by revenue for the relevant period and multiplied by the number of days in the relevant period, which is 365 days for
each year.
During the Track Record Period, we had an increase in the total balance of trade receivables;
meanwhile, our trade receivables turnover days increased from 254 days in 2022, to 283 days in 2023 and
decreased to 277 days in 2024. Our relatively high trade receivables turnover days during the Track Record
Period were primarily attributed to our public sector customers, who typically have longer payment cycles
as a result of their stringent internal financial management and payment approval processes.
We had a continuous increase in the trade receivables due from our public sector customers,
which primarily comprised receivables aged up to one year as a result of our business expansion within
the sectors, including transportation and healthcare. The turnover days for public sector customers
were 234, 330 days and 338 days in 2022, 2023 and 2024, respectively. The increase is primarily
because we had been continuously expanding our business in the public sectors such as transportation
and healthcare, the customers of which, mainly including government departments, public institutions
and state-owned enterprises, typically have a longer payment cycle in accordance with their internal
financial management and payment approval processes. We believe that our expansion in the public
sector aligns with our long-term growth objectives, and has the potential to deliver value by broadening
the application of our offerings to meet the diverse needs of the public in multiple facets of daily life.
On the other hand, we experienced prolonged collection for long-term receivables due from certain
public sector customers in 2022, most of the underlying transactions occurred in the preceding years, at
319


--- page 329 ---
FINANCIAL INFORMATION
a time when public sector end users redirected their funds with prioritized efforts to control and combat
the pandemic. We are still in the process of collecting these long-term trade receivables incurred in the
preceding years, leading to an increase in the receivables aged more than two years as of December 31,
2024 compared to the balance as of December 31, 2023.
The balance of trade receivables relating to private sector end users slightly increased from RMB215.2
million as of December 31, 2022 to RMB227.5 million as of December 31, 2023 and further increased to
RMB258.7 million as of December 31, 2024. The turnover days for private sector customers amounted to
278 days in 2022 and 232 days in 2023, as certain of our customers were in the process of improving their
overall liquidity condition during a slow post-pandemic recovery. The turnover days for private sector
customers decreased to 211 days in 2024, attributable to our enhanced collection efforts. We managed our
long-term trade receivables by implementing collection plans and providing sufficient provision, and had a
continuous decrease in the balance of trade receivables aged over one year relating to private sector end users
during the Track Record Period.
We frequently assess the recoverability of our trade receivables, and make sufficient provision
based on the customers’ past credit history and ongoing monitoring of their financial position. Our
allowance for impairment of trade receivables amounted to RMB137.6 million RMB212.1 million and
RMB241.3 million as of December 31, 2022, 2023, and 2024 respectively. We had an increase in
allowance for impairment during the Track Record Period, primarily attributable to (i) an increase in
the proportion of long aging accounts, for which a higher expected credit loss rate is applied when we
make provision; and (ii) that we adjusted the expected loss rates based on the historical and forward-
looking information on macroeconomic factors affecting the ability of the customers to settle the
receivables. See “– Financial Risk Disclosure – Financial Risk Factors – Credit Risk – Trade
receivables and contract assets.” Details of the measurement of expected credit losses under which the
lifetime expected credit losses for all trade receivables and contract assets are estimated are disclosed
in Note 3.1 of the Accountant’s Report in Appendix I to this prospectus. The reporting accountant’s
opinion on our Historical Financial Information, as a whole, for the Track Record Period is set out on
I-2 to I-3 to this prospectus.
We have been making continual efforts to collect the trade receivables. As of December 31,
2024, we had collected approximately 90% of the trade receivables from the revenue in 2022 (aged
between two to three years), approximately 85% from the revenue in 2023 (aged between one to two
years), and approximately 45% from the revenue in 2024 (aged within one year). Approximately RMB
190.2 million, or 23.8%, of our total trade receivables as of December 31, 2024, had been settled as of
April 30, 2025.
We took the following measures to further address the recoverability of trade receivables, in
particular those aged over one year:
Š As a general policy, we evaluate the recoverability of our trade receivables and frequently
communicate with our customers to control credit risks. We monitor long-aging trade
receivables closely and update the collection status of trade receivables on a regular basis.
Our business department works with customers to develop feasible payment plans, and the
success of these plans is used as a performance indicator for the sales team. We may resort
to legal actions in accordance with the contract terms where necessary.
Š We regularly assess the recoverability of the balance attributable to both public and private
sector customers and have made sufficient provision based on their respective
320


--- page 330 ---
FINANCIAL INFORMATION
characteristics and liquidity. Customers or end users from public sector typically feature a
long payment cycle due to their internal financial management and payment approval
procedures. We have also reviewed publicly accessible information regarding our private
sector customers and kept constant communication with them. Specifically, in line with
our overall provision policies for trade receivables as of December 31, 2024, the
provisions we made for unsettled trade receivable balance aged over 2 years as of
December 31, 2024 have fully covered the unsettled amount.
Š During the Track Record Period, we had transactions with Shimao Group Holdings
Limited (“ Shimao Group ”) totaling RMB120.1 million. Historically, the collection of
payments from Shimao Group has been slower than anticipated due to factors such as the
adverse impact of pandemic and industry policies. As of December 31, 2024, we had trade
receivables of RMB28.7 million, of which we made provision of RMB26.3 million, and
contract assets of RMB0.12 million, of which we made provision of RMB0.01 million,
with Shimao Group. We had collected the majority of the total trade receivables generated
from transactions with Shimao Group as of April 30, 2025, amounting to approximately
RMB296.5 million. Approximately RMB1.3 million of our total trade receivables with
Shimao Group as of December 31, 2024, had been settled as of April 30, 2025. We are in
active communication with the Shimao Group and will closely monitor the collection. We
have carefully evaluated Shimao Group’s past payment behaviors and credit risk and
provided provision accordingly. We believe that we have made sufficient provisions in
line with the expected credit loss for Shimao Group’s trade receivables during the Track
Record Period to address the potential recovery risks, and there is unlikely to be material
adverse impact on our financial and business performance in relation to such receivables.
Š In addition, we have conducted a reasonable assessment of the credit loss rate for overdue
accounts and have made sufficient provisions for impairment. We assess and adjust the expected
loss rate based on historical payment profiles, historical credit loss rates by industry, data from
external credit rating institutions and macroeconomic factors that would affect customers’
payment capabilities. We also conduct individual assessments of the risk profiles for customers
involved in legal proceedings, those with a substantial part of their trade receivable overdue for
over a year or those considered high risk, and make provision accordingly.
Š Besides enhancing the collection of existing receivables, we plan to enforce a more stringent
customer admission policy, considering factors such as the historic overdue amount and
duration of previous contracts. In addition, we are negotiating shorter credit period for
customers with outstanding historical debts and raising their upfront payment percentage.
In light of the above, we believe that the collectability of the trade receivables has been
adequately assessed based on our evaluation of the historical credit standing, ongoing monitoring and
the credit quality of these customers, and that sufficient provision has been made.
We have carefully assessed the risk of accounts receivable recovery and made sufficient
provision by reviewing the customer accounts on a case-by-case basis, taking into account of the
individual or grouped impairment and the corresponding expected credit loss rate. Our provision for
impairment increased during the Track Record Period in line with the increase of trade receivables (the
“Company’s Assessment on Trade Receivables”).
Based on the independent due diligence work conducted by the Joint Sponsors and having
considered the views and basis of our Company as disclosed above, save for the trade receivable with
321


--- page 331 ---
FINANCIAL INFORMATION
Shimao Group which is subject to proposed winding up petition as disclosed in the section headed
“Business - Customers - Collaboration with Shimao Group” above, the Joint Sponsors concur with the
Company’s Assessment on Trade Receivables in all material respect.
Prepayments and Other Receivables
Our prepayments and other receivables primarily consist of prepayments to suppliers (including
but not limited to, prepayments for software and hardware procurement, technical services and
capitalized listing expenses), rental, building and other deposits, and value-added tax to be deducted.
The following table sets forth our other receivables and prepayments as of the dates indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Prepayments to suppliers ................................................ 23,348 49,778 67,849
Rental, bidding and other deposits ......................................... 6,032 7,585 6,239
Deductible VAT input .................................................. 2,939 9,018 15,561
Others .............................................................. .343
Less: allowance for impairment of other receivables .......................... ( 1 5 2 ) (129) (122)
Total ................................................................ 32,170 66,256 89,530
As of December 31, 2022, 2023 and 2024, our other receivables and prepayments were
RMB32.2 million, RMB66.3 million and RMB89.5 million, respectively. The increase in our other
receivables and prepayments in 2023 was primarily due to prepayments to suppliers including (i) an
increase of RMB14.9 million in the software and hardware procurement to support ongoing
implementation projects as our business expanded, as well as product and prototype demonstration in
certain of our subsidiaries to promote the application of AI technologies, and (ii) an increase in the
capitalized listing expenses of RMB10.7 million. Our prepayments and other receivables increased to
RMB116.3 million as of December 31, 2024, primarily due to (i) a continued increase of in the
prepayments to suppliers for hardware for project implementation and technical service fees in support
of R&D activities, which together represent our orders placed with external suppliers to secure supplies
that meet our annual business expansion plan and ensure future delivery timelines.
As of April 30, 2025, RMB36.9 million, or approximately 41.1%, of our prepayments and other
receivables as of December 31, 2024 had been settled.
Trade and Other Payables
Our trade and other payables primarily represent (i) trade payables, (ii) tax payables, and
(iii) other payables, consisting of payables for third party service fees, listing fees, social securities and
housing benefits, borrowing from sales and leaseback, and property, plant and equipment.
322


--- page 332 ---
FINANCIAL INFORMATION
The following table sets out a breakdown of our trade and other payables as of the dates
indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Trade payables
Amounts due to third parties .......................................... 156,482 135,857 164,796
Tax payables ...................................................... 3,880 5,112 12,954
Other payables
Listing expenses .................................................... 6,910 14,303 26,806
Technology service fees .............................................. 20,187 20,906 23,764
Deposits .......................................................... 8 0 7 8 0 0 7 7 9
Borrowing from sales and leaseback .................................... — 1,000 —
Others ............................................................ 4,516 3,477 3,796
Total ............................................................. 192,782 181,455 232,895
As of December 31, 2022, 2023 and 2024 the balance of our trade and other payables were
RMB192.8 million, RMB181.5 million and RMB232.9 million, respectively. The decrease in the
balance of trade and other payables as of December 31, 2023 as compared to that of December 31,
2022 was due to our settlement with suppliers in 2023, partially offset by an increase in third party
service fees mainly representing listing expense. The increase in the balance of trade and other
payables as of December 31, 2024 as compared to that of December 31, 2023 was mainly due to an
increase in amounts due to our suppliers for procurement of hardware and software, which was in line
with our business expansion, as well as an increase in payables for listing expenses.
We are generally granted a credit period of up to six months. The following table sets out an
aging analysis of our trade payables as of the dates indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Up to 1 year ....................................................... 94,067 81,486 109,792
1 to 2 years ........................................................ 56,452 16,226 21,610
Over 2 years ....................................................... 5,963 38,145 33,394
156,482 135,857 164,796
As of April 30, 2025, RMB55.0 million, or approximately 33.4%, of our trade payables as of
December 31, 2024 had been settled.
The following table sets forth the turnover days of our trade payables for the years indicated:
Year ended December 31,
2022 2023 2024
Trade payables turnover days (1) .............................................. 1 3 5 1 2 3 9 6
Note:
(1) Trade payables turnover days for a period equals the average of the opening and closing trade payables balance divided by cost of sales
for the relevant period and multiplied by the number of days in the relevant period, which is 365 days for each year.
323


--- page 333 ---
FINANCIAL INFORMATION
Our trade payables turnover days decreased from 135 days in 2022 to 123 days in 2023 and
further to 96 days in 2024 primarily reflecting our payment schedule and growing control on our
supply chain.
Contract Liabilities
Our contract liabilities primarily represent the advance payments from customers upon which
the performance obligations have been established while the underlying services are yet to be provided.
The following table sets forth our contract liabilities as of the dates indicated:
As of December 31,
2022 2023 2024
(RMB in thousands)
Daily Life ............................................................ 42,294 53,920 80,884
Healthcare ............................................................ 12,909 10,884 5,381
Others ............................................................... 6 7 4 — —
Total ................................................................ 55,877 64,804 86,265
As of December 31, 2022, 2023 and 2024, our contract liabilities were RMB55.9 million,
RMB64.8 million and RMB86.3 million, respectively. We had a significant increase in the contract
liabilities under Daily Life, which was consistent with our overall business expansion. This increase
was partially offset by a decrease in contract liabilities under Healthcare segment, primarily due to the
completion and delivery of previously contracted projects in the current year.
As of April 30, 2025, RMB31.1 million, or approximately 36.1%, of our contract liabilities as
of December 31, 2024 had been recognized as revenue.
LIQUIDITY AND CAPITAL RESOURCES
As of December 31, 2022, 2023 and 2024, we had cash and cash equivalents of
RMB74.1 million, RMB379.2 million and RMB156.5 million, respectively. Going forward, we believe
that our liquidity requirements will be satisfied by using a combination of operating cash flow, equity
and debt financing and net proceeds from the Global Offering. In addition, we had net proceeds of
more than RMB700 million from recent Pre-IPO investment in 2023. See “History, Development and
Corporate Structure — Pre-IPO Investments.”
Cash Flow
The following table sets out our cash flows for the years indicated:
Year Ended December 31,
2022 2023 2024
(RMB in thousands)
Cash used in operations ............................................ (165,941) (284,666) (316,778)
Add:
Interest received .................................................. 3 1 4 1,875 2,298
Income tax paid .................................................. — (1,324) (957)
Addition of restricted cash .......................................... — — (3,541)
Net cash used in operating activities ................................. (165,627) (284,115) (318,978)
Net cash generated from/(used in) investing activities .................. 80,537 (128,735) 34,869
Net cash generated from financing activities .......................... 29,550 717,975 61,383
Net (decrease)/increase in cash and cash equivalents ................... (55,540) 305,125 (222,726)
Cash and cash equivalents at beginning of the year ....................... 129,650 74,118 379,224
Exchange effect on cash and cash equivalents ........................... 8 (19) (22)
Cash and cash equivalents at the end of the year ...................... 74,118 379,224 156,476
324


--- page 334 ---
FINANCIAL INFORMATION
During the Track Record Period, we had net operating cash outflow of RMB165.6 million,
RMB284.1 million RMB319.0 million in 2022, 2023 and 2024, respectively. The operating cash
outflows were primarily due to our significant investments in research and development to improve our
technology, products and solutions, and changes in working capital caused by growing trade
receivables as our business expanded rapidly during the Track Record Period. Our trade receivable
turnover and inventory turnover also impacted our cash position and cash conversion cycle given the
prolonged period for cash receipt after revenue recognition primarily as a result of public sector
customers with long payment cycles and relatively high inventory turnover days primarily as a result of
contract fulfillment costs arising from ongoing projects that are yet to be delivered to and accepted by
customers by the year end. We expect to improve our net operating cash outflows position by taking
advantage of (i) our continuous revenue growth driven by expanding customer base and expanding
product and solutions; (ii) improved operating efficiency with the launch of UniGPT, which are
expected to elevate our research and development efficiency and boost the iterations of our products
and solutions; and (iii) improved working capital efficiency. As our business continues to expand, we
expect to achieve economies of scale in research and development, sales and marketing and
governance and administration, thereby increasing the overall cost efficiency. See “Business –
Business Sustainability.”
To enhance our management of working capital, we will continue to obtain better contract
terms with our customers and suppliers and implement more stringent procedures for reviewing and
approving credit terms. We aim to build relationships with more customers with strong credit profiles
and improve our collection of trade receivables, narrowing the gap of turnover days of trade
receivables and trade payables.
Net Cash used in Operating Activities
Net cash used in operating activities primarily comprises our loss before income tax for the
period adjusted by (i) non-cash items, such as net finance costs, depreciation and amortization; and
(ii) changes in working capital, such as trade receivables, contract liabilities, trade and other payables
and contract assets.
In 2024, the net cash used in operating activities was RMB319.0 million, which was primarily
attributable to our loss before income tax of RMB454.4 million, as adjusted by (i) the add-back of non-
cash items, primarily comprising net finance costs of RMB268.6 million and net impairment losses on
financial assets and contract assets recognized in profit or loss of RMB48.4 million; and (ii) changes in
working capital, which primarily comprised an increase in trade receivables of RMB197.0 million,
partially offset by an increase in trade and other payables of RMB53.0 million.
In 2023, the net cash used in operating activities was RMB284.7 million, which was primarily
attributable to our loss before income tax of RMB373.6 million, as adjusted by (i) the add-back of non-
cash items, primarily comprising net finance costs of RMB210.9 million and net impairment losses on
financial assets and contract assets recognized in profit or loss of RMB91.3 million; and (ii) changes in
working capital, which primarily comprised an increase in trade receivables of RMB133.4 million.
In 2022, the net cash used in operating activities was RMB165.9 million, which was primarily
attributable to our loss before income tax of RMB375.6 million, as adjusted by (i) the add-back of
non-cash items, primarily comprising net finance costs of RMB177.4 million and net impairment
losses on financial assets and contract assets recognized in profit or loss of RMB72.0 million; and
(ii) changes in working capital, which primarily comprised an increase in trade receivables of
RMB176.0 million, partially offset by an increase in trade and other payables of RMB63.9 million.
325


--- page 335 ---
FINANCIAL INFORMATION
Net Cash (Used in)/Generated from Investing Activities
In 2024, the net cash generated from investing activities was RMB34.9 million, which was
primarily due to proceeds from investments in financial assets at fair value through profit or loss of
RMB150.0 million, partially offset by purchase of investments in financial assets at fair value through
profit or loss of RMB82.3 million.
In 2023, our net cash flows used in investing activities were RMB128.7 million, primarily due
to purchase of investments in financial assets at fair value through profit or loss of RMB803.0 million
and payments for property, plant and equipment and intangible assets of RMB15.0 million, partially
offset by proceeds from investments in financial assets at fair value through profit or loss of
RMB737.1 million.
In 2022, our net cash flows generated from investing activities were RMB80.5 million,
primarily due to proceeds from investments in financial assets at fair value through profit or loss of
RMB170.8 million, partially offset by purchase of investments in financial assets at fair value through
profit or loss of RMB88.9 million.
Net Cash Generated from Financing Activities
In 2024, the net cash generated from financing activities was RMB61.4 million, which was
primarily attributable to proceeds from bank borrowings of RMB195.4 million, partially offset by
repayment of bank borrowings of RMB115.0 million and payments of lease liabilities RMB13.0 million.
In 2023, our net cash flows generated from financing activities were RMB718.0 million,
primarily attributable to proceeds from issuance of equity interests to Series D3 Investors of
RMB722.0 million and proceeds from bank borrowings of RMB74.4 million, partially offset by
repayment of bank borrowings of RMB44.4 million.
In 2022, our net cash flows generated from financing activities were RMB294.6 million,
primarily attributable to proceeds from issuance of equity interests to Series D1 Investors of
RMB383.4 million and proceeds from bank borrowings of RMB53.7 million, partially offset by
repayment of bank borrowings of RMB114.6 million, payments of issuance costs for equity financing
of Series D1 of RMB15.4 million and payments of lease liabilities of RMB11.2 million and interest
expense paid of RMB2.3 million.
INDEBTEDNESS
As of April 30, 2025, being the indebtedness date for the purpose of the indebtedness
statement, our indebtedness included: (i) borrowings, which were primarily unsecured bank loans;
(ii) redemption liabilities; and (iii) lease liabilities. As of the same date, we had unutilized bank
facilities amounted to RMB326.9 million.
326


--- page 336 ---
FINANCIAL INFORMATION
The following table sets forth a breakdown of our indebtedness as of the dates indicated:
As of December 31,
As of
April 30,
2022 2023 2024 2025
(RMB in thousands)
(unaudited)
Borrowings ......................................... 35,000 65,000 145,378 133,092
Other payable — borrowing from sales and leaseback ........ — 1,000 — —
Redemption liabilities ................................. 2,108,990 3,038,456 3,303,051 3,394,737
Lease liabilities ...................................... 18,767 9,598 18,248 25,495
Total .............................................. 2,162,757 3,114,054 3,466,677 3,553,324
Borrowings
We incurred short-term and interest-bearing long-term borrowings of RMB35.0 million,
RMB65.0 million, RMB145.4 million and RMB133.1 million as of December 31, 2022, 2023 and
2024, and April 30, 2025 respectively. See Note 37 of the Appendix I of this prospectus.
As of December 31,
As of
April 30,
2022 2023 2024 2025
(RMB in thousands)
(unaudited)
Bank loans, secured .......................................... — 40,000 50,000 73,092
Unsecured bank loans ........................................ 35,000 25,000 60,000 60,000
Borrowings from discounted notes receivable (1) .................... — — 35,378 —
35,000 65,000 145,378 133,092
Note:
(1) Borrowings from discounted notes receivable are bank acceptance bills and the effective interest rates are 1.9%.
The effective interest rates for our unsecured bank loans ranged from 2.52% to 5.6% per
annum. Our Directors confirm that, as of the Latest Practicable Date, there was no material covenant
which would impact our ability to undertake additional debt financing. 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.
Other payable — borrowing from sales and leaseback
We recognize the proceeds obtained from sales and leaseback business with a third party as
borrowing due to there being no transfer of control of the goods or services in the transaction. As of
December 31, 2022, 2023 and 2024 and April 30, 2025, our borrowing from sales and leaseback
recognized as other payables amounted to nil, RMB1.0 million, nil and nil respectively.
Redemption Liabilities
As of December 31, 2022, 2023, and 2024 and April 30, 2025, our redemption liabilities were
RMB2,109.0 million, RMB3,038.5 million, RMB3,303.1 million and RMB3,394.7 million,
respectively, primarily representing our obligation to purchase our equity instruments, which is
conditional on certain investors’ exercising right to redeem.
327


--- page 337 ---
FINANCIAL INFORMATION
As of December 31,
As of
April 30,
2022 2023 2024 2025
(RMB in thousands)
(unaudited)
Redemption liabilities ................................. 2,108,990 3,038,456 3,303,051 3,394,737
Lease Liabilities
As of December 31, 2022, 2023, 2024 and April 30, 2025, our current and non-current lease
liabilities amounted to RMB18.8 million, RMB9.6 million, RMB18.2 million and RMB25.5 million,
respectively, primarily representing our lease of office premises and plants to support our overall
business growth.
As of December 31,
As of
April 30,
2022 2023 2024 2025
(RMB in thousands)
(unaudited)
Lease liabilities
Current ...................................................... 14,395 4,913 10,665 11,128
Non-current .................................................. 4,372 4,685 7,583 14,367
18,767 9,598 18,248 25,495
Indebtedness Statement
Except as disclosed above, during the Track Record Period and up to the indebtedness date, we
did not have any mortgages, charges, debentures, loan capital, debt securities, loans, bank overdrafts or
other similar indebtedness, finance lease or hire purchase commitments, liabilities under acceptances
(other than normal trade bills), acceptance credits, which are either guaranteed, unguaranteed, secured
or unsecured, or guarantees. Our Directors confirm that there has not been any material change in our
indebtedness since April 30, 2025 up to the date of this prospectus.
CONTINGENT LIABILITIES
As of December 31, 2022, 2023 and 2024 we did not have any material contingent liabilities.
COMMITMENTS
Capital Commitments
We did not have significant capital commitments as of December 31, 2022, 2023 and 2024 except
that: (i) on April 25, 2023, we entered into an agreement with Jinan Supercomputing Industry
Development Co., LTD (ʮ̡) to acquire office space in National Supercomputing
Center Jinan Science Park (Ҧ෤) for an estimated cash consideration between
RMB90 million and RMB100 million. As of December 31, 2024, we had accumulatively paid
RMB47.4 million, representing approximately 50% of total expected purchase consideration. We expect
to take delivery of the office space in 2025, and settle the remaining balance upon delivery; (ii) on
January 9, 2024, our subsidiary Yunzhisheng (Xinyang) Digital Technology Co., Ltd. (
ᑊ(ජ)ᅰο
ʮ̡) and Xinyang Huaxin Construction Investment Henan Southeast Development and
Construction Co., Ltd. (ʮ̡) jointly invested to establish Xinyang
Huayun Industrial Park Construction Co., Ltd. (ʮ̡) and promised to
contribute RMB 10 million in cash according to Articles of association. We had invested RMB 2.3 million
as of December 31, 2024. See Note 38 to the Accountant’s Report in Appendix I.
328


--- page 338 ---
FINANCIAL INFORMATION
Lease Commitments
We lease certain of our office properties under operating lease arrangements for terms of
between six months to five years. The following table sets forth our lease commitments not recognized
as liabilities as of the dates indicated:
As of December 31,
2022 2023 2024
(RMB in thousand)
Within 1 year ........................................................... 1,987 — 533
After 1 year but within 2 years ............................................. 1,998 — 336
After 2 years but within 3 years ............................................ 1,169 — 421
After 3 years but within 4 years ............................................ 9 4 0 — 4 8 1
After4 years but within 5 years ............................................. 1,011 — 200
Total ................................................................. 7,105 — 1,971
KEY FINANCIAL RATIOS
The following table sets out our key financial ratios for the years indicated:
Year ended
December 31,
2022 2023 2024
Revenue growth (%) ....................................................... 31.8 21.1 29.1
Gross profit margin (1) ( % ) ................................................... 39.9 40.5 38.8
Gross profit growth (%) .................................................... 65.4 22.8 23.8
Net loss margin (2) ( % ) ...................................................... (62.5) (51.7) (48.4)
Adjusted net margin (3) (non-IFRS financial measure) (%) .......................... (30.5) (18.8) (17.9)
Notes:
(1) Gross profit margin equals gross profit divided by revenue for the year and multiplied by 100%.
(2) Net loss margin equals net profit/loss divided by revenue for the year and multiplied by 100%.
(3) Adjusted net margin (non-IFRS financial measure) equals adjusted net profit/loss (non-IFRS financial measure) divided by revenue for
the year and multiplied by 100%.
CAPITAL EXPENDITURES
Our capital expenditures in 2022, 2023 and 2024 were RMB1.3 million, RMB15.0 million and
RMB32.9 million, respectively, representing the payments for property, plant and equipment and
intangible assets. We expect to incur additional capital expenditures in 2024 in line with our business
growth. We expect to finance such capital expenditures through the operating cash flows and net
proceeds received from the Global Offering. We may adjust our capital expenditures for any given
period according to our development plans or in light of market conditions and other factors we believe
to be appropriate.
OFF-BALANCE SHEET COMMITMENTS AND ARRANGEMENTS
As of the Latest Practicable Date, we had not entered into any off-balance sheet arrangements.
MATERIAL RELATED PARTY TRANSACTIONS
For details about our related party transactions during the Track Record Period, see Note 39 of
Appendix I to this prospectus.
329


--- page 339 ---
FINANCIAL INFORMATION
Our Directors believe that our transactions with related parties during the Track Record Period
were carried out in the normal course of business and at terms negotiated between the respective
related parties and us, and they did not distort our results of operations or make our historical results
not reflective of our future performance.
FINANCIAL RISK DISCLOSURE
Our activities expose us to a variety of financial risks: market risk (including foreign exchange
risk, interest rate risk, and price 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. We do not use any derivative financial instruments to hedge
certain risk exposures during the Track Record Period.
Financial Risk Factors
Market Risk
Foreign exchange risk
Foreign exchange risk primarily arises from recognized assets and liabilities denominated in a
currency that is not the respective group entities’ functional currency. We mainly operate in the PRC
with most of the transactions settled in Renminbi.
Our exposure to foreign exchange risk on December 31, 2022, 2023 and 2024 was insignificant
as each of the group entities did not hold significant assets and liabilities denominated in a currency
other than its functional currency.
Interest rate risk
Our interest rate risk primarily arises from redemption liabilities, borrowings, lease liabilities,
cash and cash equivalents, restricted cash and investments in wealth management products which are
classified as financial assets at FVPL. 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.
If the interest rate of borrowings with floating rate had been 10% higher/lower, the loss before
income tax for the years ended December 31, 2022, 2023 and 2024 would have been approximately
RMB34.0 thousands, RMB280.8 thousands and RMB504.7 thousands higher/lower, respectively. This
analysis does not include the effect of interest capitalized.
If the interest rate of cash and cash equivalents had been 10% higher/lower, the loss before
income tax for the years ended December 31, 2022, 2023 and 2024 would have been approximately
RMB31.4 thousands, RMB187.5 thousands and RMB36.5 thousands lower/higher, respectively.
The fair value interest rate risk arises from financial assets and liabilities carried at fixed rates is
not significant for us.
We regularly monitor our interest rate risk to ensure there is no undue exposure to significant
interest rate movements.
330


--- page 340 ---
FINANCIAL INFORMATION
Price risk
We are exposed to price risk in respect of the long-term investments and short-term investments
held by us and classified in the balance sheet as financial assets at FVPL. We are not exposed to
commodity price risk. To manage our price risk arising from the investments, we diversify its portfolio.
The investments are managed by our management one by one, either for strategic purposes, or for the
purpose of achieving investment yield and balancing our liquidity level simultaneously. The sensitivity
analysis is performed by management, see Note 3.3 to the Accountant’s Report in Appendix I to this
prospectus for details.
Credit Risk
Risk management
We are exposed to credit risk primarily in relation to our cash and cash equivalents, wealth
management products which are classified as financial assets at FVPL, restricted cash, trade
receivables, contract assets, financial lease receivables and other receivables (included in “prepayments
and other receivables”). The carrying amount of each class of the above financial assets represents our
maximum exposure to credit risk in relation to the corresponding class of financial assets.
To manage this risk arising from cash and cash equivalents, restricted cash and wealth
management products measured at financial assets as FVPL, we only transact with state-owned or
reputable financial institutions in the PRC. There has been no recent history of default in relation to
these financial institutions.
To manage risk arising from trade receivables and contract assets, we have policies in place to
ensure that sales with credit terms are made to counterparties with an appropriate credit history and the
management performs ongoing credit evaluations of its counterparties. The credit period granted to the
customers is usually no more than 180 days and the credit quality of these customers are assessed by
taking into account their financial position, past experience and other factors.
For other receivables (included in “prepayments and other receivables”) and financial lease
receivables, management makes periodic collective assessments as well as individual assessment on
the recoverability of other receivables based on historical settlement records and past experiences. In
view of the history of cooperation with debtors and the collection history of receivables due from them,
our management believes that the credit risk inherent in our outstanding other receivables balances due
from them is low.
Impairment of financial assets and contract assets
We perform impairment assessment under the expected credit loss (“ ECL”) model on financial
assets at amortized cost (mainly including trade receivables, other receivables and financial lease
receivables) and contract assets. The amount of ECL is updated at each reporting date to reflect
changes in credit risk since initial recognition.
Cash and cash equivalents, restricted cash and wealth management products
While cash and cash equivalents, restricted cash and wealth management products which are
classified as financial assets at FVPL are also subject to the impairment requirements of IFRS 9, the
identified impairment loss was immaterial, as they are mainly placed with state-owned banks in the
331


--- page 341 ---
FINANCIAL INFORMATION
PRC, and there has been no recent history of default in relation to these banks. 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.
Trade receivables and contract assets
We apply the IFRS 9 simplified approach to measuring expected credit losses under which the
lifetime expected credit losses for all trade receivables and contract assets are estimated. To measure
the expected credit losses, trade receivables and contract assets have been grouped based on shared
credit risk characteristics, credit rating and aging based of revenue recognition. The expected loss rates
are based on the historical payment profiles, historical credit loss rates by industry and data published
by external credit rating institution, 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), consumer price index (CPI), procedure price index (PPI)
and broad money (M2) of mainland China in which it provides services to be the most relevant factors,
and accordingly adjusts the loss rates based on expected changes in those factors.
Liquidity Risk
We aim to maintain sufficient cash and cash equivalents. Due to the dynamic nature of the
underlying businesses, our policy is to regularly monitor our liquidity risk and to maintain adequate
cash and cash equivalents or adjust financing arrangements to meet our liquidity requirements.
DIVIDEND
No dividend was paid or declared by our Company or other entities comprising our Group
during the Track Record Period. Currently, we have not implemented policy to fix the dividend
distribution ratio.
Any future declarations and payments of dividends will be at the absolute discretion of our
Directors and will depend on our actual and expected results of operations, cash flow and financial
position, general business conditions and business strategies, expected working capital requirements
and future expansion plans, legal, regulatory and other contractual restrictions, and other factors which
our Directors consider relevant. As advised by our PRC Legal Advisors, no dividend shall be declared
or payable except out of our profits and reserves lawfully available for distribution. 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. Our Shareholders in a general
meeting may approve any declaration of dividends recommended by our Board.
WORKING CAPITAL CONFIRMATION
Taking into account the financial resources available to us including our cash and cash
equivalents on hand, unutilized bank facilities and the estimated net proceeds from the Global
Offering, our directors are of the view that we have sufficient working capital to meet our present
requirements and for the next 12 months from the date of this prospectus.
DISTRIBUTABLE RESERVES
As of December 31, 2024, we had no distributable reserves.
332


--- page 342 ---
FINANCIAL INFORMATION
LISTING EXPENSE
Listing expenses represent professional fees, underwriting commission, and other fees incurred
in connection with the Global Offering. We estimate that our listing expenses, including underwriting
commission for the Global Offering, will be approximately HK$112.2 million (including (i)
underwriting commission of approximately HK$11.6 million, and (ii) non-underwriting related
expenses of approximately HK$100.6 million, which consist of fees and expenses of legal advisors and
Reporting Accountant, of approximately HK$73.7 million and other fees and expenses of
approximately HK$26.9 million), representing approximately 38.84% of the gross proceeds from the
Global Offering, (assuming an Offer Price of HK$185.00 per Offer Share (being the mid-point of the
indicative Offer Price range) and no exercise of the Over-allotment Option). Among the total listing
expenses, approximately HK$17.1 million is directly attributable to the issue of our Offer Shares to the
public and will be deducted from equity, HK$69.1 million has been expensed as of December 31, 2024
and the remaining amount of approximately HK$26.0 million is expected to be expensed upon the
Listing.
UNAUDITED PRO FORMA STATEMENT OF ADJUSTED NET TANGIBLE ASSETS
See “Appendix II — Unaudited Pro Forma Financial Information.”
NO MATERIAL ADVERSE CHANGE
After performing sufficient due diligence work which our Directors consider appropriate and
after due and careful consideration, the Directors confirm that, up to the date of this prospectus, there
has been no material adverse change in our financial or trading position or prospects since
December 31, 2024, being the end date of the periods reported in Appendix I to this prospectus, and
there is no event since December 31, 2024 that would materially affect the information as set out in the
Accountant’s Report in Appendix I to this prospectus.
DISCLOSURE UNDER RULES 13.13 TO 13.19 OF 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.
333


--- page 343 ---
FUTURE PLANS AND USE OF PROCEEDS
FUTURE PLANS
See “Business — Our Strategies.”
USE OF PROCEEDS
Assuming an Offer Price of HK$185.00 per Offer Share (being the mid-point of the Offer Price
range), we estimate that we will receive net proceeds of approximately HK$176.6 million from the
Global Offering after deducting the underwriting commissions and other estimated expenses in
connection with the Global Offering and assuming that the Over-allotment Option is not exercised. In
line with our strategies, we intend to use our proceeds from the Global Offering for the purposes and in
the amounts set forth below:
Research and Development
Š Approximately 45.6% or HK$80.5 million, for enhancing our research and development
capabilities over the next five years, with the detailed breakdown of the proceeds to be allocated
as follows:
Investment in Atlas AI Infrastructure
O Approximately 30.8% or HK$54.4 million will be allocated to invest in our Atlas AI
infrastructure. We will continuously optimize the orchestration system of our
supercomputing platform to improve the efficiency of AI model training. We plan to
closely monitor technological developments in mainstream machine learning algorithms,
continually upgrade to maintain our industry leadership in the underlying technology.
In addition, we plan to upgrade and expand our computing, storage and network
communications capabilities according to our operational needs. We expect to
continuously expand our intelligent computing clusters by purchasing hardware such as
GPUs, data storage, servers and network equipment, as well as third-party colocation
services for our servers and IT equipment. We plan to purchase cloud computing services
from third parties on a flexible basis to allow business scalability and flexibility. The
following table sets forth our procurement plan for GPUs:
Type of GPU Estimated total cost Unit price Underlying computing power
High-performance GPU
training servers for large
language model training
HK$21.0 million HK$1.5 million Each GPU server delivers up
to 3 PFLOPS of deep
learning performance. With
the computing power for
deep learning expanding
from 300 PFLOPS to 500
PFLOPS, we will be able to
complete the training of
models with over 100 billion
parameters using one trillion
tokens within six weeks,
sustaining our competitive
edge in large language model
development in the long
term.
334


--- page 344 ---
FUTURE PLANS AND USE OF PROCEEDS
Type of GPU Estimated total cost Unit price Underlying computing power
Generic GPU inference servers HK$1.3 million HK$0.25 million Each GPU server delivers up
to 1 PFLOPS of compute
performance. These servers
can handle massive requests
and perform concurrent
inference on large language
models with over 10 billion
parameters, with a maximum
processing capacity of 22
million times per day (10
seconds each time).
UniBrain Upgrade
O Approximately 7.7% or HK$13.6 million will be allocated to upgrade our UniBrain to
further enhance our AI development capabilities. We plan to procure training materials
and manual feedback and annotation services to support the upgrade of our software and
algorithms, addressing the evolving needs in various application scenarios. We plan to
improve the performance of our large language models and enhance their adaptability to
application scenarios. We expect to further increase the parameter scale and data scale of
the large language model, and train and optimize proprietary multimodal large language
models that can directly process inputs such as images, voice and text. In addition, we plan
to train large language models optimized for industry tasks to expand the application
scope, especially for certain highly specialized industries, such as consultancy service and
utilities.
In addition, we plan to further improve our AI components by (i) expanding our AI multi-
lingual capabilities to adapt to multi-modal scenarios; (ii) improving the quality and scale
of knowledge graph; (iii) improving the openness and accessibility of the IoT platform;
and (iv) expanding our ecosystem by offering more developer tools and broadening the
application scope of the UniBrain to grow our customer base.
Talent Cultivation and Joint R&D
O Approximately 7.1% or HK$12.5 million will be allocated to cultivate talents and conduct
R&D collaboration. For internal talent training, we plan to improve our knowledge
management by establishing an internal knowledge base and organizing training sessions
and conferences. We also plan to collaborate with external institutions, including
universities and research institutes, through (i) establishing joint laboratories to research
and develop emerging AI technologies; (ii) carrying out joint research projects and
engaging students and researchers as part of our research talent development efforts; and
(iii) creating open-source projects on the UniBrain, which will allow us to connect with a
wider range of industry players. We plan to allocate approximately HK$8.8 million in the
joint laboratories and joint research projects. We expect to collaborate with institutions
that possess strong research and development capabilities and a deep pool of skilled talent
in the areas such as large language model, multi-modal perception and generation, and
knowledge graph, with research plans aligning with our business fields. As of the Latest
Practicable Date, we had not identified any specific targets for R&D collaboration, and
had not set any definitive timeframe.
335


--- page 345 ---
FUTURE PLANS AND USE OF PROCEEDS
Business Opportunity Exploration
Š Approximately 47.0% or HK$83.0 million will be allocated to invest in emerging business
opportunities and increase adoption and penetration of our products across industry verticals and
scenarios over the next five years.
We plan to expand product development teams and sales teams, promote and market our products
through marketing activities, such as industry exhibitions, as well as establish our brand image
and influence.
Increasing Adoption of Our Solutions in Existing Verticals
O Approximately 13.9% or HK$24.6 million will be allocated to improve our existing Daily
Life and Healthcare solutions. We will expand our sales team to conduct market surveys
and better understand our customers’ diverse needs, and leverage our product development
team to upgrade existing products and services and expand to new application scenarios to
meet constantly evolving industry needs, and further increase the adoption and penetration
of our solutions in existing verticals.
The table below sets forth our plan for product development and sales team expansion over the
next five years:
Position Estimated total cost
Estimated
total number
of personnel
to be
remunerated Qualification
(HKD in millions)
Product development personnel ....... 7 . 6 4 7 Scientists, researchers, architects or
engineers with undergraduate or
graduate degree (depending on the
position) or above, and work
experience in artificial intelligence
and software development
Sales personnel ................... 7 . 3 2 9 Bachelor degree, relevant sales
experienced will be preferred
Penetration into Emerging Verticals
O Approximately 33.1% or HK$58.4 million will be allocated to explore business
opportunities and further penetrate into emerging verticals. For example, we plan to
continue to recruit product development personnel and develop AI solutions targeting
elderly care vertical utilizing our experience and capabilities in IoT and healthcare.
Leveraging our expanding sales team, we expect to continuously explore business
opportunities and establish our brand in relevant industries, such as:
(i) AI in finance solution market, which helps drive insights for data analytics,
performance measurement, predictions and forecasting, real-time calculations,
customer servicing, intelligent data retrieval, among others. The market size of AI in
finance solution in China increased from RMB3.8 billion in 2019 to RMB20.0 billion
in 2024, with a CAGR of 54.3%. In 2028, it is expected to grow to RMB161.6 billion
with a CAGR of 56.5% from 2024 to 2030. Major players in the market mainly
336


--- page 346 ---
FUTURE PLANS AND USE OF PROCEEDS
include digital solution providers. However, AI in finance solution market still faces
the following practical challenges, such as rising operation and maintenance costs
and cybersecurity threats;
(ii) AI in grid solution, which leverages AI technology to manage and optimize energy
distribution as a means to improve the energy efficiency of generating and consuming
electricity in homes, businesses, and public institutions. The market size of AI in grid
solution in China increased from RMB3.1 billion in 2019 to RMB8.9 billion in 2022,
with a CAGR of 42.0%. It is expected to grow to RMB43.1 billion with a CAGR of
30.1% from 2022 to 2028. Major players in the market are digital solution providers.
One of the main challenges of the AI in grid solution market is dealing with a large
number of diverse systems, each with their own objectives and operating under
uncertainty and dynamism. This includes customers with different demand profiles
and generators with varying volatilities, leading to unpredictable and fluctuating
network conditions.
The table below sets forth our plan for product development and sales team expansion over the
next five years:
Position Estimated total cost
Estimated
total number
of personnel
to be
remunerated Qualification
(HKD in millions)
Product development personnel ....... 13.2 64 Scientists, researchers, architects or
engineers with undergraduate or
graduate degree (depending on the
position) or above, and work
experience in artificial intelligence
and software development
Sales personnel ................... 4 . 4 2 9 Bachelor degree, relevant sales
experienced will be preferred
Working Capital and General Corporate Purposes
Š Approximately 7.4% or HK$13.1 million will be allocated to working capital and general
corporate purposes.
If the Offer Price is set at the high-end of the Offer Price range or the low-end of the Offer
Price range, the net proceeds of the Global Offering will increase or decrease by approximately
HK$29.8 million and HK$29.8 million, respectively. To the extent our net proceeds from the Global
Offering are either more or less than expected, we will increase or decrease the intended use of our net
proceeds for the above purposes on a pro rata basis.
If the Over-allotment Option is fully exercised, our Company will receive additional net
proceeds of approximately HK$41.4 million for 234,140 Shares to be allotted and issued upon the full
exercise of the Over-allotment Option based on the Offer Price of HK$185.00 per Offer Share, being
the mid-point of the Offer Price range, and after deducting the underwriting fees and commissions
payable by our Company. The additional amount raised will be applied to the above areas of use of
proceeds on a pro-rata basis.
337


--- page 347 ---
FUTURE PLANS AND USE OF PROCEEDS
If any part of our development plan does not proceed as planned for reasons such as changes in
government policies that would render the development of any of our projects not viable, or the
occurrence of force majeure events, we will carefully evaluate the situation and may reallocate the net
proceeds from the Global Offering.
To the extent that the net proceeds of the Global Offering are not immediately used for the
purposes described above and to the extent permitted by the relevant laws and regulations, we only
intend to place such proceeds in short-term interest-bearing deposits with licensed banks or authorized
financial institutions as defined under the Securities and Futures Ordinance or applicable laws and
regulations in other jurisdictions.
338


--- page 348 ---
UNDERWRITING
OVERALL COORDINATORS AND JOINT GLOBAL COORDINATORS
China International Capital Corporation Hong Kong Securities Limited
Haitong International Securities Company Limited
ABCI Capital Limited
HONG KONG UNDERWRITERS
China International Capital Corporation Hong Kong Securities Limited
Haitong International Securities Company Limited
ABCI Securities Company Limited
Orient Securities (Hong Kong) Limited
CMBC Securities Company Limited
Tiger Brokers (HK) Global Limited
UNDERWRITING
This prospectus is published solely in connection with the Hong Kong Public Offering. The
Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters on a conditional
basis. The International Offering is expected to be fully underwritten by the International Underwriters
subject to the terms and conditions of the International Underwriting Agreement. If, for any reason, the
Offer Price is not agreed between the Overall Coordinators and our Company, the Global Offering will
not proceed and will lapse.
The Global Offering comprises the Hong Kong Public Offering of initially 156,100 Hong Kong
Offer Shares and the International Offering of initially 1,404,880 International Offer Shares, subject, in
each case, to reallocation on the basis as described in “Structure of the Global Offering” as well as to
the Over-allotment Option in the case of the International Offering.
UNDERWRITING ARRANGEMENTS AND EXPENSES
Hong Kong Public Offering
Hong Kong Underwriting Agreement
Pursuant to the Hong Kong Underwriting Agreement, we are offering the Hong Kong Offer
Shares (subject to adjustment) for subscription by the public in Hong Kong in accordance with the
terms and conditions of this prospectus relating thereto.
Subject to the Stock Exchange granting approval for the listing of, and permission to deal in,
the H Shares to be issued pursuant to the Global Offering (including any H Shares which may be
issued pursuant to the exercise of the Overallotment Option) and any H Shares to be converted from
Domestic Unlisted Shares as mentioned herein, and certain other conditions set forth in the Hong
Kong Underwriting Agreement (including but not limited to the Offer Price being agreed upon
339


--- page 349 ---
UNDERWRITING
between our Company and the Overall Coordinators (for themselves and on behalf of the Hong Kong
Underwriters)), the Hong Kong Underwriters have agreed to subscribe or procure subscribers for their
respective applicable portions of the Hong Kong Offer Shares in aggregate, now being offered which
are not taken up under the Hong Kong Public Offering on the terms and conditions of this prospectus
and the Hong Kong Underwriting Agreement.
The Hong Kong Underwriting Agreement is conditional on 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.
Grounds for Termination
The obligations of the Hong Kong Underwriters to subscribe or procure subscribers for the
Hong Kong Offer Shares are subject to termination by written notice from the Overall Coordinators
(for themselves and on behalf of the Hong Kong Underwriters) and the Joint Sponsors, if any of the
events set forth below occur at any time prior to 8:00 a.m. on the Listing Date:
(1) there develops, occurs, exists or comes into effect:
(i) any or a series of national, regional or international event(s) or circumstance(s) 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, epidemic, pandemic, outbreak or escalations of infectious disease (including,
without limitation, Severe Acute Respiratory Syndrome (SARS), swine or avian
flu, Coronavirus Disease 2019 (COVID-19), H1N1, H5N1, H7N9, Ebola virus,
Middle East respiratory syndrome and such related or mutated forms and variants),
economic sanctions, strikes, labor disputes, other industrial actions, lock-outs, fire,
explosion, flooding, earthquake, tsunami, volcanic eruption, civil commotion, riots,
severe transport disruption, paralysis in government operation, public disorder, acts
of war, outbreak or escalation of hostilities (whether or not war is declared), acts of
God or acts of terrorism (whether or not responsibility has been claimed), paralysis
in government operations, in or directly or indirectly affecting Hong Kong, the
PRC, the United States, the United Kingdom, any member of the European Union,
or any other jurisdictions relevant to any member of the Group or the Global
Offering (collectively, the “Relevant Jurisdictions”); or
(ii) any change, or any development involving a prospective change (whether or not
permenant), or any event or circumstance or series of events which likely to result
in any change or development involving a prospective change in any local,
national, regional or international financial, economic, political, military,
industrial, legal, fiscal, regulatory, currency, credit or market conditions, equity
securities or exchange control or any monetary or trading settlement system or
other financial markets (including, without limitation, conditions in the stock and
bond markets, money and foreign exchange markets, the interbank markets and
credit markets) in or affecting any of the Relevant Jurisdictions; or
(iii) any moratorium, suspension or restriction (including, without limitation, any
imposition of or requirement for any minimum or maximum price limit or price
range) in or on trading in securities generally on the Stock Exchange, the New
York Stock Exchange, the NASDAQ Global Market, the London Stock Exchange,
the Shanghai Stock Exchange or the Shenzhen Stock Exchange; or
340


--- page 350 ---
UNDERWRITING
(iv) any general moratorium on commercial banking activities in Relevant
Jurisdictions, or any disruption in commercial banking or foreign exchange trading
or securities settlement or clearance services, procedures or matters in or affecting
any Relevant Jurisdictions; or
(v) any new laws, or any change or any development involving a prospective change
or any event or circumstance or series of events which likely to result in a change
or a development involving a prospective change in, or in the interpretation or
application by any court or other competent authority of, existing laws, in each
case, in or affecting any of the Relevant Jurisdictions; or
(vi) the imposition of sanctions or export controls on any Group Company or any of the
Controlling Shareholders, 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 of the Relevant Jurisdictions; or
(vii) a change or development involving a prospective change in or affecting taxation or
exchange control, currency exchange rates or foreign investment regulations
(including, without limitation, a material devaluation of Hong Kong Dollar or the
Renminbi, United States dollar, Euro or British pound against any foreign
currencies or a change in the system under which the value of the Hong Kong
dollar is linked to that of the United States dollar, or Renminbi is linked to any
foreign currency), or the implementation of any exchange control, in any of the
Relevant Jurisdictions or affecting investments in the Offer Shares; or
(viii) any valid demands by any creditor for repayment or payment of any indebtedness
of any member of the Group or in respect of which any member of the Group is
liable prior to its stated maturity; or
(ix) any non-compliance of this prospectus (or any other documents used in connection
with the contemplated offering, allotment, issue, subscription or sale of the Offer
Shares) the CSRC filings or any aspect of the Global Offering with the Listing
Rules or any other applicable laws; or
(x) any proceedings, 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 Controlling Shareholder or any Director,
Supervisor or senior management members as named in this prospectus or member
of the Controlling Shareholders; or
(xi) a Director or a Supervisor or a member of the Company’s senior management as
named in this prospectus being charged with an indictable offense or prohibited by
operation of law or otherwise disqualified from taking part in the management or
take directorship/supervisorship of a company; or
(xii) any Director, Supervisor, the chairman, chief executive officer or the chief
financial officer of the Company vacating his/her office; or
(xiii) an order or petition for the winding up of any member of the Group or any
composition or arrangement made by any member of the Group with its creditors
or a scheme of arrangement entered into by any member of the Group or any
resolution for the winding-up of any member of the Group or the appointment of a
provisional liquidator, receiver or manager over all or part of the material assets or
341


--- page 351 ---
UNDERWRITING
undertaking of any member of the Group or anything analogous thereto occurring
in respect of any member of the Group; or
(xiv) any contravention by any member of the Group of or any Director or Supervisor
the Listing Rules or applicable laws in any material respects; or
which, individually or in the aggregate, in the sole and absolute opinion of the Overall
Coordinators and the Joint Sponsors:
(a) has or will have or may have a material adverse change, or a material adverse
effect, or any development involving a prospective material adverse change or
material adverse effect, whether directly or indirectly, on or affecting the
assets, liabilities, business, general affairs, management, Shareholders’ equity,
revenue, profits, losses, results of operations, positions or conditions, financial
or otherwise, or performance of the Group, taken as a whole; or
(b) 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 interest under the International Offering or dealings in
the Offer Shares in the secondary market; or
(c) makes or will make or may make it inadvisable or inexpedient or
impracticable for the Global Offering to proceed or to market the Global
Offering or the delivery or distribution of the Offer Shares on the terms and in
the manner contemplated by the Hong Kong Public Offering Documents (as
defined in the Hong Kong Underwriting Agreement); or
(d) has or will have or may have the effect of making any part of the Hong Kong
Underwriting Agreement (including underwriting) incapable of performance
in accordance with its terms or preventing or delaying the processing of
applications and/or payments pursuant to the Global Offering or pursuant to
the underwriting thereof; or
(2) there has come to the notice of the Overall Coordinators and the Joint Sponsors:
(a) a prohibition by any authority applicable to our Company, the Controlling
Shareholders, any of the Underwriters, and/or any of the foregoing’s respective
affiliates, for whatever reason from offering, allotting, issuing, selling or delivering
any of the Offer Shares (including the Option Shares (as defined in the Hong Kong
Underwriting Agreement)) pursuant to the terms of the Global Offering; or
(b) that any statement contained in any of the Hong Kong Public Offering Documents
(as defined in the Hong Kong Underwriting Agreement), the CSRC filings, the
offering circulars and/or in any notices or announcements, advertisements,
communications or other documents issued or used by or on behalf of our
Company in connection with the Hong Kong Public Offering (including any
supplement or amendment thereto) was, when it was issued, or has become, untrue,
incorrect, inaccurate, incomplete or misleading in any material respect, or that any
forecast, estimate, expression of opinion, intention or expectation contained therein
is not fair and honest and based on reasonable assumptions; or
(c) that any matter has arisen or has been discovered which would, had it arisen or
been discovered immediately before the date of this prospectus, constitute a
342


--- page 352 ---
UNDERWRITING
material omission from any of this Hong Kong Public Offering Documents (as
defined in the Hong Kong Underwriting Agreement), CSRC filings and/or any
notices, announcements, advertisements, communications or other documents
issued or used by or on behalf of our Company in connection with the Hong Kong
Public Offering (including any supplement or amendment thereto); or
(d) any breach of any of the obligations imposed upon any party to the Hong Kong
Underwriting Agreement or the International Underwriting Agreement (other than
upon any of the Hong Kong Underwriters or the International Underwriters or the
Cornerstone Investment Agreements); or
(e) any event, act or omission that gives or is likely to give rise to any liability of any
of the Indemnifying Parties (as defined in the Hong Kong Underwriting
Agreement) pursuant to the indemnities given by any of them under the Hong
Kong Underwriting Agreement or the International Underwriting Agreement; or
(f) (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
(g) our Company withdraws any of the offering documents, CSRC filings (and/or any
other documents issued or used in connection with the Global Offering) or the
Global Offering; or
(h) that any person (other than the Joint Sponsors) has withdrawn or is subject to
withdrawal of its consent to the inclusion of its reports, letters and/or opinions (as
the case may be) or references to its name included in the form and context in
which it respectively appears; or
(i) a material portion of the orders in the book-building process or the investment
commitments by any cornerstone investors after signing of the Cornerstone
Investment Agreements, have been withdrawn, terminated or canceled.
Undertakings to the Stock Exchange Pursuant to the Listing Rules
Undertakings by our Company
Pursuant to Rule 10.08 of the Listing Rules, we have undertaken to the Stock Exchange that, no
further Shares or securities convertible into equity securities of our Company (whether or not of a class
already listed) may be issued by us or form the subject of any agreement to such issue within six
months from the Listing Date (whether or not such issue of Shares or securities will be completed
within six months from the Listing Date), except for (a) any capitalization issue, capital reduction or
consolidation or sub-division of Shares; (b) issue of Shares or our securities pursuant to the Global
Offering (including the exercise of the Over-allotment Option); or (c) any other applicable
circumstances provided under Rule 10.08 of the Listing Rules.
343


--- page 353 ---
UNDERWRITING
Undertakings by the Controlling Shareholders
Pursuant to Rule 10.07 of the Listing Rules, the Controlling Shareholders have undertaken to
the Stock Exchange and our Company that:
(a) at any time in the period commencing on the date by reference to which disclosure
of their shareholding in the Company is made in this prospectus and ending on the
date which is six months from the Listing Date, they shall not and shall procure
that the relevant registered holder(s) shall not 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 Shares in respect of which they are shown
by the Prospectus to be the beneficial owner(s) (the “ Relevant Securities”); and
(b) at any time in the period of six months commencing on the date on which the
period referred to in paragraph (a) above expires, they shall not and shall procure
that the relevant registered holder(s) shall not 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 Shares referred to in paragraph (a) above if,
immediately following such disposal or upon exercise or enforcement of such
options, rights, interests or encumbrances, they would cease to be the Controlling
Shareholders (as defined in the Listing Rules) of the Company.
Pursuant to Note (3) to Rule 10.07(2) of the Listing Rules, the Controlling Shareholders have
undertaken to the Stock Exchange and our Company that, within the period commencing on the date
by reference to which disclosure of their shareholding in our Company is made in this prospectus and
ending on the date which is 12 months from the Listing Date, they will:
(i) when any of them pledges or charges any Relevant Securities or interests in any of
the Relevant Securities, whether directly or indirectly, in favor of any authorized
institution (as defined in the Banking Ordinance (Chapter 155 of the Laws of Hong
Kong)) for a bona fide commercial loan pursuant to Note (2) to Rule 10.07 of the
Listing Rules, immediately inform our Company of such pledge or charge together
with the number of Relevant Securities so pledged or charged; and
(ii) when any of them receives indications, either verbal or written, from the pledgee or
chargee of any Relevant Securities that any of the pledged or charged securities of
our Company will be disposed of, immediately inform our Company of such
indications.
Our Company will inform the Stock Exchange as soon as we have been informed of the matters
referred to in paragraphs (i) and (ii) above by the Controlling Shareholders and disclose such matters
by way of an announcement which is published in accordance with Rule 2.07C of the Listing Rules as
soon as possible.
Undertakings Pursuant to the Hong Kong Underwriting Agreement
Undertakings by our Company and the Controlling Shareholders in respect of our Company
Our Company, has undertaken to each of the Sponsor-Overall Coordinators the Overall
Coordinators, the Joint Global Coordinators, the Joint Sponsors, the Joint Bookrunners, the Joint Lead
Managers, the Capital Market Intermediaries, and the Hong Kong Underwriters that, except pursuant
to the Global Offering (including pursuant to the exercise of the Over-allotment Option), at any time
344


--- page 354 ---
UNDERWRITING
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 ”), our Company will not, and will procure
each other member of the Group not to, 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 set out in the Listing Rules:
(i) allot, issue, sell, accept subscription for, offer to allot, issue or sell, contract or agree to
allot, issue or sell, mortgage, charge, pledge, hypothecate, hedge, lend, grant or sell any
option, warrant, contract or right to subscribe for or purchase, grant or purchase any
option, warrant, contract or right to allot, issue or sell, or otherwise transfer or dispose of
or create an encumbrance over, or agree to transfer or dispose of or purchase or create an
encumbrance over, or contract either directly or indirectly, conditionally or
unconditionally, any legal or beneficial interest in any Shares or other securities of our
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 subscribe for or purchase, any Shares or other
securities of our Company, or any interest in any of the foregoing), or deposit any Shares
or other securities of our 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 Shares or other
securities of our Company, or any interest in any of the foregoing (including, without
limitation, any securities convertible into or exchangeable or exercisable for or that
represent the right to receive, or any warrants or other rights to purchase, any H Shares or
other equity securities of our Company, or any interest in any of the foregoing); or
(iii) enter into any transaction with the same economic effect as any transaction specified in
sub-paragraph (i) or (ii) above; or
(iv) offer to, or contract to, or agree to, or announce or publicly disclose any intention to effect
any transaction specified in sub-paragraph (i), (ii) or (iii) above,
in each case, whether any of the foregoing transactions specified in sub-paragraph (i), (ii) or (iii) above
is to be settled by the delivery of Shares or other equity securities of our Company, or, in cash or
otherwise (whether or not the issue of such Shares or other shares or 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 ”),
our Company enters into any of the transactions specified in sub-paragraph (i), (ii) or (iii) above or
offers to or agrees to or announces any intention to effect any such transaction, our Company shall take
all reasonable steps to ensure that any such transaction, offer, agreement or announcement or
disclosure (as the case maybe) will not create a disorderly or false market in the securities of our
Company.
Our Controlling Shareholders have undertaken to each of the Joint Sponsors, the
Sponsor-Overall Coordinators, the Overall Coordinators, the Joint Global Coordinators, the Joint
Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries and the Hong Kong
Underwriters that it/he shall procure our Company to comply with the above undertakings.
Our Company has agreed and undertaken to each of the Joint Sponsors, the Sponsor-Overall
Coordinators, the Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint
345


--- page 355 ---
UNDERWRITING
Lead Managers, the Capital Market Intermediaries and the Hong Kong Underwriters that we will, and
the Controlling Shareholders undertake to procure that our Company will, comply with the minimum
public float requirements specified in Rule 8.08 of the Listing Rules (or such lower percentage
permitted under any waiver granted and not revoked by the Stock Exchange, where applicable) (the
“Minimum Public Float Requirement ”), and will not, effect or permit any purchase, allotment or
issuance of H Shares by itself or by any other persons (where applicable), or agree to do so, which may
reduce the holdings of Shares held by the public (as defined in Rule 8.24 of the Listing Rules) below
such Minimum Public Float Requirements on or before the date falling six months after the Listing
Date without first having obtained the prior written consent of the Joint Sponsors and the Overall
Coordinators (for themselves and on behalf of the other Underwriters).
Undertakings by the Controlling Shareholders in respect of themselves
Each of the Controlling Shareholders hereby undertakes on a joint and several basis to each of
our Company, the Joint Sponsors, the Sponsor-Overall Coordinators, the Overall Coordinators, the
Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market
Intermediaries and the Hong Kong Underwriters that, except as pursuant to the Global Offering
(including pursuant to the exercise of the Over-allotment Option), without the prior written consent of
the Joint Sponsors and the Overall Coordinators (for itself and on behalf of the Hong Kong
Underwriters) and unless in compliance with the requirements of the Listing Rules:
(a) it/he not to, will not, and will procure that the relevant registered holder(s), at any time
during the First Six Month Period, (i) sell, offer to sell, contract or agree to sell, mortgage,
charge, pledge, hypothecate, lend, grant or sell any option, warrant, contract or right to
purchase, grant or purchase any option, warrant, contract or right to sell, or otherwise
transfer or dispose of or create an encumbrance over, or agree to transfer or dispose of or
create an encumbrance over, either directly or indirectly, conditionally or unconditionally,
any H Shares or other securities of our Company or any interest therein (including,
without limitation, any securities convertible into or exchangeable or exercisable for or
that represent the right to receive, or any warrants or other rights to purchase, any H
Shares or any such other securities, as applicable or any interest in any of the foregoing),
legally or beneficially owned by him/it as of the Listing Date (the “ Locked-up
Securities”), 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
Locked-up Securities, or (iii) enter into any transaction with the same economic effect as
any transaction specified in paragraph (a)(i) or (ii) above, or (iv) offer to, contract to, or
agree to or announce any intention to effect any transaction specified in paragraph (a)(i),
(ii) or (iii) above, in each case, whether any of the transactions specified in paragraph
(a)(i), (ii) or (iii) above is to be settled by delivery of H Shares or other securities of our
Company or in cash or otherwise, and whether or not the issue of such Shares or other
securities will be completed within the First Six Month Period; and
(b) it/he will not, during the Second Six Month Period, enter into any of the transactions
specified in paragraph (a)(i), (ii) or (iii) above in respect of any Locked-up Securities or offer
to or contract to or announce or publicly disclose any intention to enter into any such
transaction if, immediately following such transaction or upon the exercise or enforcement
of any option, right, interest or encumbrance pursuant to such transaction, he/it (individually
or in aggregate) will cease to be a member of a group of the Controlling Shareholders of our
Company and/or the Controlling Shareholders, as the case may be; and
346


--- page 356 ---
UNDERWRITING
(c) until the expiry of the Second Six Month Period, in the event that it/he enters into any of
the transactions specified in paragraph (a)(i), (ii) or (iii) or above or effects or offers to or
agrees to or contract to or announces any intention to effect any such transaction, it/he will
take all reasonable steps to ensure that such a disposal will not create a disorderly or false
market in the securities of our Company.
Indemnity
We and our Controlling Shareholders have agreed to indemnify, among the others, the Joint
Sponsors, the Sponsor-Overall Coordinators the Overall Coordinators, the Joint Global Coordinators,
the Joint Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries, and the Hong
Kong Underwriters for certain losses which they may suffer, including, amongst others, losses arising
from their performance of their obligations under the Hong Kong Underwriting Agreement and any
breach by our Company of the Hong Kong Underwriting Agreement.
Hong Kong Underwriters’ Interests in our Company
Except for its obligations under the Hong Kong Underwriting Agreement, the Hong Kong
Underwriters do not have 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 or any member of our Group.
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.
International Offering
International Underwriting Agreement
In connection with the International Offering, it is expected that we will enter into the
International Underwriting Agreement with, among others, the International Underwriters. Under the
International Underwriting Agreement, subject to the conditions set forth therein, the International
Underwriters would agree to purchase, or procure subscribers to purchase, the Offer Shares being
offered pursuant to the International Offering (subject to, amongst others, any reallocation between the
International Offering and the Hong Kong Public Offering). It is expected that the International
Underwriting Agreement may be terminated on similar grounds as the Hong Kong Underwriting
Agreement. Potential investors are reminded that in the event that the International Underwriting
Agreement is not entered into, the Global Offering will not proceed.
Over-allotment Option
Our Company is expected to grant to the International Underwriters, exercisable in whole or in
part by the Overall Coordinators at their sole and absolute discretion (on behalf of the International
Underwriters), the Over-allotment Option, which will be exercisable from the Listing Date
until 30 days after the last day for the lodging of applications under the Hong Kong Public Offering, to
require our Company to allot and issue, up to an aggregate of 234,140 H Shares, representing no more
than 15.0% of the initial Offer Shares under the Global Offering, at the Offer Price, to cover over-
allocations in the International Offering, if any.
347


--- page 357 ---
UNDERWRITING
Commissions and Expenses
Our Company will pay an underwriting commission of 3.00% of the aggregate Offer Price of
all the Offer Shares, including Offer Shares to be issued pursuant to the Over-allotment Option. Our
Company may, at our sole and absolute discretion, pay an incentive fee of up to 2.00% of the Offer
Price in respect of all the Offer Shares (including Offer Shares to be issued pursuant to the Over-
allotment Option).
Assuming the incentive fee is paid in full, the fixed fees and discretionary fees payable to the
Capital Market Intermediaries represent approximately 41.1% and 58.9%, respectively, of the
aggregate fees payable to the Capital Market Intermediaries in total in connection with the Global
Offering. For unsubscribed Hong Kong Offer Shares reallocated to the International Offering, we will
pay an underwriting commission at the rate applicable to the International Offering and such
commission will be paid to the relevant International Underwriters and not the Hong Kong
Underwriters.
Assuming the Over-allotment Option is not exercised, the aggregate commissions and fees,
together with the listing fees, SFC transaction levy, the Stock Exchange trading fee, AFRC transaction
levy, legal and other professional fees and printing and other expenses relating to the Global Offering,
which are currently estimated to amount in aggregate to approximately HK$112.2 million (assuming
an Offer Price of HK$185.00 per Offer Share, being the mid-point of the indicative Offering Price
range stated in this prospectus), are payable and borne by our Company.
INDEPENDENCE OF THE JOINT SPONSORS
The 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 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, 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 activity could
occur in Hong Kong and elsewhere in the world and may result in the Syndicate Members and their
affiliates holding long and/or short positions in the H Shares, in baskets of securities or indices
including the H Shares, in units of funds that may purchase the H Shares, or in derivatives related to
any of the foregoing.
348


--- page 358 ---
UNDERWRITING
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
the section headed “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 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 our Company and its
affiliates for which such Syndicate Members or their respective affiliates have received or will receive
customary fees and commissions.
349


--- page 359 ---
STRUCTURE OF THE GLOBAL OFFERING
THE GLOBAL OFFERING
This prospectus is published in connection with the Hong Kong Public Offering as part of the
Global Offering. The Global Offering comprises (subject to adjustment and the Over-allotment
Option):
(a) the Hong Kong Public Offering of 156,100 H Shares (subject to adjustment as mentioned
below) for subscription by the public in Hong Kong as described in “– The Hong Kong
Public Offering” below; and
(b) the International Offering of 1,404,880 H Shares (subject to adjustment and the Over-
allotment Option as mentioned below) outside the United States (including to professional
and institutional investors within Hong Kong) in offshore transactions in reliance on
Regulation S or any other available exemption from registration under the U.S. Securities
Act as described in “– The International Offering” below.
Investors may apply for the Hong Kong Offer Shares under the Hong Kong Public Offering or
indicate an interest, if qualified to do so, for the International Offer Shares under the International
Offering, but may not do both.
The Offer Shares will represent 2.20% of the enlarged issued share capital of our Company
immediately after completion of the Global Offering without taking into account the exercise of the
Over-allotment Option. If the Over-allotment Option is exercised in full, the additional International
Offer Shares will represent approximately 0.33% of the enlarged issued share capital of our Company
immediately after completion of the Global Offering and the exercise of the Over-allotment Option as
set out in “– The International Offering – Over-allotment Option” below.
The Hong Kong Public Offering is open to members of the public in Hong Kong as well as to
institutional and professional investors in Hong Kong. The International Offering will involve selective
marketing of the International Offer Shares to institutional and professional investors and other
investors expected to have a sizeable demand for the International Offer Shares in Hong Kong and
other jurisdictions outside the United States in reliance on Regulation S. The International
Underwriters are soliciting from prospective investors’ indications of interest in acquiring the
International Offer Shares under the International Offering. Prospective 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.
References in this prospectus to applications, application monies or the procedure for
application relate solely to the Hong Kong Public Offering.
The number of Offer Shares to be offered under the Hong Kong Public Offering and the
International Offering, respectively, may be subject to reallocation as described in “– The Hong Kong
Public Offering – Reallocation” below.
THE HONG KONG PUBLIC OFFERING
Number of Hong Kong Offer Shares Initially Offered
We are initially offering 156,100 H Shares for subscription by the public in Hong Kong at the
Offer Price, representing approximately 10.0% of the total number of the Offer Shares initially
350


--- page 360 ---
STRUCTURE OF THE GLOBAL OFFERING
available under the Global Offering. Subject to the reallocation of the Offer Shares between the
International Offering and the Hong Kong Public Offering, the Hong Kong Offer Shares will represent
0.22% of the enlarged issued share capital of our Company 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, and
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 forth in
“– 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 the others who have applied for the same number of the
Hong Kong Offer Shares, and those applicants who are not successful in the ballot may not receive any
Hong Kong Offer Shares.
For allocation purpose only, the total number of the Offer Shares initially available under the
Hong Kong Public Offering (after taking into account any adjustment in the number of the Offer
Shares allocated between the Hong Kong Public Offering and the International Offering) is to be
divided into two pools: Pool A and Pool B. Accordingly, the maximum number of Hong Kong Offer
Shares initially in Pool A and Pool B will be 78,060 and 78,040, respectively. The Hong Kong Offer
Shares in Pool A will be allocated on an equitable basis to applicants who have applied for Hong Kong
Offer Shares with an aggregate subscription price of HK$5 million (excluding the brokerage, SFC
transaction levy, AFRC transaction levy and the Stock Exchange trading fee payable) or less. The
Hong Kong Offer Shares in Pool B will be allocated on an equitable basis to 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, AFRC transaction levy and the Stock Exchange
trading fee payable) and up to the total value of pool B.
Investors should be aware that applications in Pool A and applications in Pool B may receive
different allocation ratios. If the Hong Kong Offer Shares in one (but not both) of the pools are under-
subscribed, the surplus 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 therein (without regard to the Offer Price as
finally determined). Applicants can only receive an allocation of the Hong Kong Offer Shares from
either Pool A or Pool B but not from both pools.
Multiple or suspected multiple applications and any application for more than 78,040 Hong
Kong Offer Shares (being approximately 50% of the 156,100 Hong Kong Offer Shares initially
available under the Hong Kong Public Offering) are liable to be rejected.
351


--- page 361 ---
STRUCTURE OF THE GLOBAL OFFERING
Reallocation
The allocation of the Offer Shares between the Hong Kong Public Offering and the
International Offering is subject to adjustment. Paragraph 4.2 of Practice Note 18 of the Listing Rules
requires a clawback mechanism to be put in place which would have the effect of increasing the
number of the Offer Shares under the Hong Kong Public Offering to a certain percentage if the
International Offer Shares are fully subscribed or oversubscribed and certain prescribed total demand
levels under the Hong Kong Public Offering are reached as further described below:
Š if the number of Offer Shares validly applied for under the Hong Kong Public Offering
represents 15 times or more but less than 50 times the number of Offer Shares initially
available for subscription under the Hong Kong Public Offering, then Offer Shares will be
reallocated to the Hong Kong Public Offering from the International Offering so that the
total number of Offer Shares available under the Hong Kong Public Offering will be
468,300 H Shares, representing approximately 30% of the Offer Shares initially available
under the Global Offering (assuming the Over-allotment Option is not exercised);
Š if the number of Offer Shares validly applied for under the Hong Kong Public Offering
represents 50 times or more but less than 100 times the number of Offer Shares initially
available for subscription under the Hong Kong Public Offering, then the number of Offer
Shares to be reallocated to the Hong Kong Public Offering from the International Offering
will be increased so that the total number of Offer Shares available under the Hong Kong
Public Offering will be 624,400 H Shares, representing approximately 40% of the Offer
Shares initially available under the Global Offering (assuming the Over-allotment Option
is not exercised); and
Š if the number of Offer Shares validly applied for under the Hong Kong Public Offering
represents 100 times or more the number of Offer Shares initially available for subscription
under the Hong Kong Public Offering, then the number of Offer Shares to be reallocated to
the Hong Kong Public Offering from the International Offering will be increased so that the
total number of Offer Shares available under the Hong Kong Public Offering will be
780,500 H Shares, representing approximately 50% of the Offer Shares initially available
under the Global Offering (assuming the Over-allotment Option is not exercised).
In addition, the Offer Shares to be offered in the Hong Kong Public Offering and the
International Offering may, in certain circumstances, be reallocated as between these offerings at the
discretion of the Overall Coordinators. In accordance with Chapter 4.14 of the Guide for New Listing
Applicants issued by the Stock Exchange, if such reallocation is done other than pursuant to Practice
Note 18 of the Listing Rules for:
Š if the International Offer Shares are fully subscribed or oversubscribed, and the number of
Offer Shares validly applied for under the Hong Kong Public Offering represents less
than 15 times the number of the Offer Shares initially available for subscription under the
Hong Kong Public Offering
Š if the International Offer Shares are undersubscribed, and the Hong Kong Offer Shares are
fully subscribed or oversubscribed (irrespective of the extent of over-subscription)
the maximum total number of H Shares that may be reallocated to the Hong Kong Public
Offering shall be not more than 312,200 H Shares, representing two times the number of Hong Kong
352


--- page 362 ---
STRUCTURE OF THE GLOBAL OFFERING
Offer Shares initially available under the Hong Kong Public Offering and double of the number of Offer
Shares initially available under the Hong Kong Public Offering; and the final Offer Price shall be fixed at
HK$165.00 per Offer Share, the low-end of the Offer Price range stated in this prospectus.
Any such clawback and reallocation between the International Offering and the Hong Kong
Public Offering will be completed prior to any adjustments of the number of the Offer Shares pursuant
to the exercise of the Over-allotment Option, if any.
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 Overall Coordinators in their sole
discretion consider appropriate.
If the Hong Kong Public Offering is not fully subscribed, the Overall Coordinators may
reallocate all or any unsubscribed Hong Kong Offer Shares to the International Offering, in such
proportions as the Overall Coordinators deem appropriate. However, if neither the Hong Kong Public
Offering nor the International Offering is fully subscribed, the Global Offering will not proceed unless
the Underwriters would subscribe or procure subscribers for respective applicable proportions of the
Offer Shares being offered which are not taken up under the Global Offering on the terms and
conditions of this prospectus and the Underwriting Agreements.
Applications
Each applicant under the Hong Kong Public Offering will also be required to give an
undertaking and confirmation in the application submitted by him/her that he/she and any person(s) for
whose benefit he/she is making the application have not applied for or taken up, or indicated an interest
for, and will not apply for or take up, or indicate an interest for, any Offer Shares under the
International Offering, and such applicant’s application is liable to be rejected if the said undertaking
and/or confirmation is breached and/or untrue (as the case may be) or it has been or will be placed or
allocated Offer Shares under the International Offering.
Applicants under the Hong Kong Public Offering may be required to pay, on application
(subject to application channels), the maximum Offer Price of HK$205.00 per Offer Share in addition
to the brokerage, SFC transaction levy, AFRC transaction levy and the Stock Exchange trading fee
payable on each Offer Share. If the Offer Price, as finally determined in the manner described in “–
Pricing and Allocation” below, is less than the maximum price of HK$205.00 per Offer Share,
appropriate refund payments (including the brokerage, SFC transaction levy, AFRC transaction levy
and the Stock Exchange trading fee attributable to the surplus application monies) will be made to
successful applicants (subject to application channels), without interest. Further details are set out
below in “How to Apply for Hong Kong Offer Shares.”
THE INTERNATIONAL OFFERING
Number of International Offer Shares Initially Offered
Subject to reallocation as described in this section and the exercise of the Over-allotment
Option, the International Offering will consist of an initial offering of 1,404,880 Offer Shares,
representing approximately 90% of the total number of Offer Shares initially available under the
Global Offering subject to the reallocation of Offer Shares between the International Offering and the
Hong Kong Public Offering and assuming that the Over-allotment Option is not exercised.
353


--- page 363 ---
STRUCTURE OF THE GLOBAL OFFERING
Allocation
The International Offering will include selective marketing of the Offer Shares to institutional
and professional investors and other investors anticipated to have a sizeable demand for such Offer
Shares. Professional investors generally include brokers, dealers, companies (including fund managers)
whose ordinary business involves dealing in shares and other securities and corporate entities which
regularly invest in shares and other securities. Allocation of the Offer Shares pursuant to the
International Offering will be effected in accordance with the “book-building” process described in “–
Pricing and Allocation” and based on a number of factors, including the level and timing of demand,
the total size of the relevant investor’s invested assets or equity assets in the relevant sector and
whether or not it is expected that the relevant investor is likely to buy further Offer Shares, and/or hold
or sell its Offer Shares, after the listing of the Offer Shares on the Stock Exchange. Such allocation is
intended to result in a distribution of the International Offer Shares on a basis which would lead to the
establishment of a solid professional and institutional shareholder base to the benefit of our Company
and its Shareholders as a whole.
The Overall Coordinators (for themselves and on behalf of the International Underwriters) may
require any investor who has been offered the International Offer Shares under the International
Offering, and who has made an application under the Hong Kong Public Offering, to provide sufficient
information to the Overall Coordinators so as to allow them to identify the relevant applications under
the Hong Kong Public Offering and to ensure that they are excluded from any application of the Offer
Shares under the Hong Kong Public Offering.
Reallocation
The total number of the Offer Shares to be issued or sold pursuant to the International Offering
may change as a result of the reallocation arrangement described in “– The Hong Kong Public Offering
– Reallocation,” 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 to the International
Offering.
Over-allotment Option
Our Company expects to grant to the International Underwriters, exercisable in whole or in part
by the Overall Coordinators at their sole and absolute discretion (on behalf of the International
Underwriters), the Over-allotment Option, which will be exercisable from the Listing Date until
30 days after the last day for the lodging of applications under the Hong Kong Public Offering, to
require our Company to allot and issue, up to an aggregate of 234,140 Offer Shares, representing no
more than 15.0% of the Offer Shares initially available under the Global Offering, at the Offer Price, to
cover over-allocations in the International Offering, if any. If the Over-allotment Option is exercised in
full, the additional International Offer Shares will represent approximately 0.33% of our Company’s
enlarged issued share capital immediately following completion of the Global Offering and the
exercise of the Over-allotment Option. In the event that the Over-allotment Option is exercised, we
will make an announcement in due course.
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 newly issued securities in the
354


--- page 364 ---
STRUCTURE OF THE GLOBAL OFFERING
secondary market, during a specified period of time, to reduce and, if possible, prevent any decline in
the market price of the securities below the offer price. In Hong Kong and a number of other
jurisdictions, activity aimed at reducing the market price is prohibited, and the price at which
stabilization is effected is not permitted to exceed the offer price.
In connection with the Global Offering, the Stabilizing Manager, its affiliates or any person acting
for it, as stabilizing manager, on behalf of the Underwriters, may to the extent permitted by applicable
laws of Hong Kong or elsewhere, over-allocate or effect transactions with a view to stabilizing or
supporting the market price of the H Shares at a level higher than that which might otherwise prevail for a
limited period after the Listing Date. However, there is no obligation on the Stabilizing Manager, its
affiliates or any persons acting for it, to conduct any such stabilizing action. Such stabilization action, if
commenced, may be discontinued at any time, and 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. Should stabilizing
transactions be effected in connection with the Global Offering, this will be effected at the absolute
discretion of the Stabilizing Manager, its affiliates or any person acting for it.
Stabilizing action permitted in Hong Kong pursuant to the Securities and Futures (Price
Stabilizing) Rules (Chapter 571W of the Laws of Hong Kong), as amended, includes (i) over-
allocation for the purpose of preventing or minimizing any reduction in the market price of the H
Shares, (ii) 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, (iii) purchasing
or subscribing for, or agreeing to purchase or subscribe for, the Offer Shares pursuant to the Over-
allotment Option in order to close out any position established under (i) or (ii) above, (iv) purchasing,
or agreeing to purchase, any of the Offer Shares for the sole purpose of preventing or minimizing any
reduction in the market price of the Offer Shares, (v) selling or agreeing to sell any Offer Shares in
order to liquidate any position established as a result of those purchases and (vi) offering or attempting
to do anything as described in paragraph (ii), (iii), (iv) or (v).
Specifically, prospective applicants for and investors in the Offer Shares should note that:
Š the Stabilizing Manager, its affiliates or any person acting for it may, in connection with
the stabilizing action, maintain a long position in the H Shares;
Š there is no certainty regarding the extent to which and the time or period for which the
Stabilizing Manager, or any person acting for it, will maintain such a long position;
Š liquidation of any such long position by the Stabilizing Manager, its affiliates or any
person acting for it may have an adverse impact on the market price of the H Shares;
Š no stabilizing action can be taken to support the price of the H Shares for longer than the
stabilizing period which will begin on the Listing Date, and is expected to expire on
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 therefore the price of the H Shares, could fall;
Š the price of the H Shares cannot be assured to stay at or above the Offer Price by the
taking of any stabilizing action; and
Š stabilizing bids may be made or transactions effected in the course of the stabilizing action
at any price at or below the Offer Price, which means that stabilizing bids may be made or
transactions effected at a price below the price paid by applicants for, or investors in, the H
Shares.
355


--- page 365 ---
STRUCTURE OF THE GLOBAL OFFERING
Our Company will ensure or procure that an announcement in compliance with the Securities
and Futures (Price Stabilizing) Rules (Chapter 571W of the Laws of Hong Kong) will be made within
seven days of the expiration of the stabilization period.
Over-allocation
Following any over-allocation of the H Shares in connection with the Global Offering, the
Overall Coordinators and their affiliates or any person acting for them may cover such over-allocation
by, amongst other methods, exercising the Over-allotment Option in full or in part, by using H Shares
purchased by the Stabilizing Manager, its affiliates or any person acting for it in the secondary market
or by a combination of these means. Any such purchases will be made in accordance with the laws,
rules and regulations in place in Hong Kong on stabilization. The number of H Shares which can be
over-allocated will not exceed the number of the H Shares which may be allotted and/or issued
pursuant to the exercise in full of the Over-allotment Option, being 234,140 H Shares, representing
approximately 15.0% of the Offer Shares initially available under the Global Offering.
PRICING AND ALLOCATION
The International Underwriters will be soliciting from prospective investors indications of
interest in acquiring the Offer Shares in the International Offering. Prospective professional and
institutional investors will be required to specify the number of Offer Shares under the International
Offering they would be prepared to acquire either at the Offer Price. This process, known as “book-
building,” is expected to continue up to, and to cease on or about, the last day for lodging applications
under the Hong Kong Public Offering.
The Offer Price is expected to be fixed by agreement between our Company and the Overall
Coordinators (for themselves and on behalf of the Underwriters) on the Price Determination Date,
which is expected to be on or about Thursday, June 26, 2025 and in any event no later than 12:00 noon
on Thursday, June 26, 2025 by agreement among the Overall Coordinators (on behalf of the
Underwriters) and our Company. The number of Offer Shares to be allocated under the various
offerings will be determined shortly thereafter.
The Offer Price will not be more than HK$205.00 per Offer Share and is expected to be not less
than HK$165.00 per Offer Share unless otherwise announced, as further explained below, not later
than the morning of the last day for lodging applications under the Hong Kong Public Offering.
Prospective investors should be aware that the Offer Price to be determined on the Price
Determination Date may be, but is not expected to be, lower than the indicative Offer Price range
stated in this prospectus.
If, for any reason, the Offer Price is not agreed between the Overall Coordinators (for
themselves and on behalf of the Underwriters) and us by 12:00 noon on Thursday, June 26, 2025
the Global Offering will not proceed and will lapse.
The International Underwriters will be soliciting from prospective investors’ indications of
interest in acquiring Offer Shares in the International Offering. Prospective professional and
institutional investors will be required to specify the number of Offer Shares under the International
Offering they would be prepared to acquire either at different prices or at a particular price. This
process, known as “book-building”, is expected to continue up to, and to cease on or about, the last day
for lodging applications under the Hong Kong Public Offering.
356


--- page 366 ---
STRUCTURE OF THE GLOBAL OFFERING
The Overall Coordinators (for themselves and on behalf of the Underwriters) may, where they
deem appropriate, based on the level of interest expressed by prospective investors during the book-
building process in respect of the International Offering, and with the consent of the Company, reduce
the number of Offer Shares offered and/or the indicative Offer Price range as stated in this prospectus
at any time on or prior to the morning of the last day for lodging applications under the Hong Kong
Public Offering. In such 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 last day for lodging
applications under the Hong Kong Public Offering, cause to be published on the websites of the
Company and the Stock Exchange at www.unisoud.com and www.hkexnews.hk, respectively, notices
of the reduction, and the cancelation of the Global Offering and relaunch of the offer at the revised
number of Offer Shares and/or the Offer Price range.
The Company will also, as soon as practicable following the decision to make such change,
issue a supplemental or new prospectus updating investors of the change in the number of Offer Shares
and/or the indicative Offer Price range, and giving investors at least three business days to consider the
new information. The supplemental or new prospectus should include at least the following:
(i) updated indicative Offer Price range and market capitalization; (ii) updated listing timetable and
underwriting obligations; (iii) updated price/earnings multiple, unaudited pro forma and adjusted net
tangible assets; and (iv) updated use of proceeds and confirmation of the working capital adequacy
based on the revised estimated proceeds.
Before submitting applications for the Hong Kong Offer Shares, applicants should have regard
to the possibility that any announcement of a reduction in the number of Offer Shares and/or the
indicative Offer Price range may not be made until the day which is the last day for lodging
applications under the Hong Kong Public Offering. In the absence of any such notice so announced
and any such supplemental prospectus or new prospectus so published, the number of Offer Shares and
the indicative Offer Price range will not be reduced.
If there is any change to the offer size due to change in the number of Offer Shares offered in
the Global Offering (other than pursuant to the reallocation mechanism as disclosed in this prospectus),
or change to the indicative Offer Price range as stated in this prospectus, or if the Company becomes
aware that there has been a significant change affecting any matter contained in this prospectus or a
significant new matter has arisen, the inclusion of information in respect of which would have been
required to be in this Prospectus if it had arisen before this prospectus was issued, after the issue of this
prospectus and before the commencement of dealings in our H Shares as prescribed under Rule 11.13
of the Listing Rules, we are required to cancel the Global Offering and relaunch the offer with a
supplemental prospectus or a new prospectus in FINI.
The final Offer Price, the level of indications of interest in the International Offering, the level
of applications in the Hong Kong Public Offering and the basis of allocations of Offer Shares under the
Hong Kong Public Offering are expected to be announced on Friday, June 27, 2025 on the website of
our Company (www.unisound.com) and the website of the Stock Exchange ( www.hkexnews.hk).
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 subject to agreement on the Offer Price
between our Company and the Overall Coordinators (for themselves and on behalf of the
Underwriters) on the Price Determination Date.
357


--- page 367 ---
STRUCTURE OF THE GLOBAL OFFERING
We expect that our Company will enter into the International Underwriting Agreement relating
to the International Offering on the Price Determination Date.
The underwriting arrangements under the Hong Kong Underwriting Agreement and the
International Underwriting Agreement are summarized in the section headed “Underwriting”.
CONDITIONS OF THE GLOBAL OFFERING
Acceptances of all applications for Offer Shares will be conditional on:
(a) the Stock Exchange granting listing of, and permission to deal in, the H Shares to be
issued pursuant to the Global Offering (including any H Shares which may be issued
pursuant to the exercise of the Over-allotment Option) and any H Shares to be converted
from Domestic Unlisted Shares as mentioned herein and such approval not having been
withdrawn;
(b) the Offer Price having been agreed between our Company and the Overall Coordinators
(on behalf of the Underwriters) on the Price Determination Date;
(c) the execution and delivery of the International Underwriting Agreement on or about the
Price Determination Date; and
(d) 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 Underwriting 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).
If, for any reason, the Offer Price is not agreed between our Company, the Overall Coordinators
(on behalf of the Underwriters) on or before 12:00 noon on Thursday, June 26, 2025, the Global
Offering will not proceed and will lapse.
The consummation of each of the Hong Kong Public Offering and the International Offering is
conditional upon, amongst other things, the other 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. We will as soon as
possible publish or cause to be published a notice of the lapse of the Hong Kong Public Offering on the
website of our Company ( www.unisound.com) and the website of the Stock Exchange
(www.hkexnews.hk). In such eventuality, all application monies will be returned, without interest, on
the terms set forth “How to Apply for Hong Kong Offer Shares – D. Despatch/Collection of H Share
Certificates and Refund of Application Monies.” In the meantime, all application monies will be held
in a separate bank account(s) with the receiving banks or other bank(s) in Hong Kong licensed under
the Banking Ordinance (Chapter 155 of the Laws of Hong Kong), as amended.
H Share certificates issued in respect of the Hong Kong Offer Shares will only become valid at
8:00 a.m. on the Listing Date provided that the Global Offering has become unconditional in all
respects (including the Underwriting Agreements not having been terminated in accordance with their
terms) at any time prior to 8:00 a.m. on the Listing Date.
358


--- page 368 ---
STRUCTURE OF THE GLOBAL OFFERING
APPLICATION FOR LISTING ON THE STOCK EXCHANGE
We have applied to the Stock Exchange for the listing of, and permission to deal in, the Shares
in issue and to be issued pursuant to the Global Offering (including pursuant to the exercise of the
Over-allotment Option) and as mentioned in this prospectus.
No part of our Company’s share or loan capital is listed on or dealt in on any other stock
exchange and no such listing or permission to deal is being or proposed to be sought in the near future.
H SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
Subject to the granting of the listing of, and permission to deal in, the H Shares on the Stock
Exchange and compliance with the stock admission requirements of HKSCC, the H Shares will be
accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect
from the Listing Date or on any other date as determined by HKSCC. Settlement of transactions
between participants of the Stock Exchange is required to take place in CCASS on the second
settlement day after any trading day. All activities under CCASS are subject to the General Rules of
HKSCC and the HKSCC Operational Procedures in effect from time to time.
All necessary arrangements have been made to enable the H Shares to be admitted into
CCASS. Investors should seek the advice of their stockbroker or other professional advisor for details
of those settlement arrangements and how such arrangements will affect their rights and interests.
DEALING ARRANGEMENTS
Assuming that the Hong Kong Public Offering becomes unconditional at or before 8:00 a.m. in
Hong Kong on Monday, June 30, 2025, it is expected that dealings in the H Shares on the Stock
Exchange will commence at 9:00 a.m. on Monday, June 30, 2025. The H Shares will be traded on the
Main Board of the Stock Exchange in board lots of 20 H Shares each. The stock code of the H Shares
will be 9678.
359


--- page 369 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
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.unisound.com.
The contents of this prospectus are identical to the prospectus as registered with the
Registrar of Companies in Hong Kong pursuant to Section 342C/38D 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:
Š are 18 years of age or older; and
Š 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:
Š are an existing beneficial owner of any Shares in the Company and/or any of its
subsidiaries;
Š are a Director or a Supervisor or chief executive officer of the Company and/or any of its
subsidiaries;
Š are a close associate (as defined in the Listing Rules) of any of the above;
Š a connected person (as defined in the Listing Rules) of the Company or will become a
connected person of the Company immediately upon completion of the Global Offering;
or
Š have been allocated or have applied for any International Offer Shares or otherwise
participate in the International Offering.
360


--- page 370 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
2. Application Channels
The Hong Kong Public Offering period will begin at 9:00 a.m. on Friday, June 20, 2025 and
end at 12:00 noon on Wednesday, June 25, 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 Investors who would
like to receive a
physical H Share
certificate. Hong
Kong Offer Shares
successfully applied
for will be allotted
and issued in your
own name.
From 9:00 a.m. on
Friday, June 20, 2025 to
11:30 a.m. on
Wednesday, June 25,
2025, Hong Kong time.
The latest time for
completing full payment
of application monies will
be 12:00 noon on
Wednesday, June 25,
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
Investors who would
not like to receive a
physical H Share
certificate. Hong
Kong Offer Shares
successfully applied
for will be allotted
and issued in the
name of HKSCC
Nominees, deposited
directly into CCASS
and credited to your
designated HKSCC
Participant’s stock
account.
Contact your broker or
custodian for the earliest
and latest time for giving
such instructions, as this
may vary by broker or
custodian.
The HK eIPO White Form service and the HKSCC EIPO channel are facilities subject to
capacity limitations and potential service interruptions and you are advised not to wait until the last day
of the application period to apply for Hong Kong Offer Shares.
For those applying through the HK eIPO White Form service, once you complete payment in
respect of any application instructions given by you or for your benefit through the HK eIPO White
Form service to make an application for Hong Kong Offer Shares, an actual application shall be
deemed to have been made. If you are a person for whose benefit the electronic application instructions
are given, you shall be deemed to have declared that only one set of electronic application instructions
has been given for your benefit. If you are an agent for another person, you shall be deemed to have
declared that you have only given one set of electronic application instructions for the benefit of the
person for whom you are an agent and that you are duly authorized to give those instructions as an
agent.
361


--- page 371 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
For the avoidance of doubt, giving an application instruction under the HK eIPO White Form
service more than once and obtaining different payment reference numbers without effecting full
payment in respect of a particular reference number will not constitute an actual application.
If you apply through the HK eIPO White Form service, you are deemed to have authorized
the HK eIPO White Form Service Provider to apply on the terms and conditions in this prospectus, as
supplemented and amended by the terms and conditions of the HK eIPO White Form service.
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 the HKSCC EIPO channel, an actual application will be deemed to
have been made for any application instructions given by you or for your benefit to HKSCC (in which
case an application will be made by HKSCC Nominees on your behalf) provided such application
instruction has not been withdrawn or otherwise invalidated before the closing time of the Hong Kong
Public Offering.
HKSCC Nominees will only be acting as a nominee for you and neither HKSCC nor HKSCC
Nominees shall be liable to you or any other person in respect of any actions taken by HKSCC or
HKSCC Nominees on your behalf to apply for Hong Kong Offer Shares or for any breach of the terms
and conditions of this prospectus.
3. Information Required to Apply
You must provide the following information with your application:
For Individual Applicants For Corporate Applicants
▪ Full name(s) 2 as shown on your identity
document
▪ Identity document’s issuing country or
jurisdiction
▪ Identity document type, with order of
priority:
i. HKID card; or
ii. National identification document; or
iii. Passport; and
▪ Identity document number
▪ Full name(s)
2 as shown on your
identity document
▪ Identity document’s issuing country or
jurisdiction
▪ Identity document type, with order of
priority:
i. LEI registration document; or
ii. Certificate of incorporation; or
iii. Business registration certificate;
or
iv. Other equivalent document; and
▪ Identity document number
Notes:
1. If you are applying through the 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.
362


--- page 372 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
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.
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 account holders 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:
Š control the composition of the board of directors of the company;
Š control more than half of the voting power of the company; or
Š 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 the HKSCC EIPO channel, and making an application under a
power of attorney, we and the 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.
363


--- page 373 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
4. Permitted Number of Hong Kong Offer Shares for Application
Board lot size :2 0
Permitted number of Hong
Kong Offer Shares for
application and amount
payable on application/
successful allotment
: Hong Kong Offer Shares are available for application in
specified board lot sizes only. Please refer to the amount
payable associated with each specified board lot size in the
table below.
The maximum Offer Price is HK$205.00 per H Share.
If you are applying through the HKSCC EIPO channel, you
are required to prefund your application based on the
amount specified by your broker or custodian, as
determined based on the applicable laws and regulations in
Hong Kong.
By instructing your broker or custodian to apply for the
Hong Kong Offer Shares on your behalf through the
HKSCC EIPO Channel, you (and, if you are joint
applicants, each of you jointly and severally) are deemed to
have instructed and authorized HKSCC to cause HKSCC
Nominees (acting as nominee for the relevant HKSCC
Participants) to arrange payment of the final Offer Price,
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 maximum amount payable on
application in full upon application for Hong Kong Offer
Shares.
364


--- page 374 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount payable(2)
on application/
successful
allotment
No. of Hong
Kong Offer
Shares
applied for
Maximum
Amount payable(2)
on application/
successful
allotment
No. of Hong
Kong
Offer Shares
applied for
Maximum
Amount payable(2)
on application/
successful
allotment
No. of Hong
Kong
Offer Shares
applied for
Maximum
Amount payable(2)
on application/
successful
allotment
HK$ HK$ HK$ HK$
20 4,141.35 400 82,826.96 6,000 1,242,404.56 40,000 8,282,697.00
40 8,282.69 500 103,533.71 7,000 1,449,471.98 50,000 10,353,371.26
60 12,424.04 600 124,240.45 8,000 1,656,539.40 60,000 12,424,045.50
80 16,565.39 700 144,947.20 9,000 1,863,606.83 78,040
(1) 16,159,541.85
100 20,706.74 800 165,653.95 10,000 2,070,674.26
120 24,848.09 900 186,360.68 12,000 2,484,809.10
140 28,989.43 1,000 207,067.43 14,000 2,898,943.96
160 33,130.79 2,000 414,134.86 16,000 3,313,078.80
180 37,272.14 3,000 621,202.28 18,000 3,727,213.66
200 41,413.49 4,000 828,269.70 20,000 4,141,348.50
300 62,120.22 5,000 1,035,337.13 30,000 6,212,022.76
(1) Maximum number of Hong Kong Offer Shares you may apply for and this is 50% of the Hong Kong Offer Shares initially offered.
(2) The amount payable is inclusive of brokerage, SFC transaction levy, the Stock Exchange trading fee and AFRC transaction levy. If your
application is successful, brokerage will be paid to the Exchange Participants (as defined in the Listing Rules) or to the HK eIPO White
Form Service Provider (for applications made through the application channel of the HK eIPO White Form service) while the SFC
transaction levy, the Stock Exchange trading fee and the AFRC transaction levy will be paid to the SFC, the Stock Exchange and the
AFRC, respectively.
5. Multiple Applications Prohibited
You or your joint applicant(s) shall not make more than one application for your own benefit,
except where you are a nominee and provide the information of the underlying investor in your
application as required under the paragraph headed “— A. Applications for Hong Kong Offer Shares –
3. Information Required to Apply ” in this section. If you are suspected of submitting or cause to submit
more than one application, all of your applications will be rejected.
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 further for any Offer Shares
in the Global Offering.
The H Share Registrar would record all applications into its system and identify suspected
multiple applications with identical names and identification document numbers according to the Best
Practice Note on Treatment of Multiple / Suspected Multiple Applications (“ Best Practice Note ”)
issued by the Federation of Share Registrars Limited.
Since applications are subject to personal information collection statements, identification
document numbers are redacted.
6. Terms and Conditions of An Application
By applying for Hong Kong Offer Shares through the HK eIPO White Form service or
HKSCC EIPO channel, you (or as the case may be, HKSCC Nominees will do the following things
on your behalf):
(i) undertake to execute all relevant documents and instruct and authorize us and/or the
Overall Coordinators, as our agents, to execute any documents for you and to do on
365


--- page 375 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
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;
(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 Relevant Persons
(1), 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;
366


--- page 376 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
(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 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 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
(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.
1 As defined in the prospectus, Relevant Persons would include the Joint Sponsors, the Sponsor-Overall Coordinators, the Overall Coordinators,
the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Mana gers, the Underwriters, the Capital Market Intermediaries, any of
their or the Company’s respective directors, officers, employees, par tners, agents, advisers and any other parties involved in the Global
Offering.
367


--- page 377 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
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
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.
24 hours, from 11:00 p.m. on
Friday, June 27, 2025 to 12:00 midnight on
Thursday, July 3, 2025 (Hong Kong time)
The Stock Exchange’s website at
www.hkexnews.hkand our website at
www.unisound.comwhich will provide links
to the above mentioned websites of the H
Share Registrar.
No later than 11:00 p.m. on
Friday, June 27, 2025 (Hong Kong time).
Telephone +852 3691 8488 - the allocation results
telephone enquiry line provided by the H
Share Registrar
between 9:00 a.m. and 6:00 p.m., from
Monday, June 30, 2025 to
Friday, July 4, 2025 (Hong Kong time)
on a business day
For those applying through the HKSCC EIPO channel, you may also check with your broker or
custodian from 6:00 p.m. on Thursday, June 26, 2025 (Hong Kong time).
HKSCC Participants can log into FINI and review the allotment result from 6:00 p.m. on
Thursday, June 26, 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 final Offer Price, the level of indications of interest in
the Global Offering, the level of applications in the Hong Kong Public Offering and the basis of
allocations of Hong Kong Offer Shares on the Stock Exchange’s website at www.hkexnews.hk and
our website at www.unisound.com by no later than 11:00 p.m. on Friday, June 27, 2025 (Hong Kong
time).
368


--- page 378 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
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 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.
3. If the allocation of Hong Kong Offer Shares is void:
The allocation of Hong Kong Offer Shares will be void if the Stock Exchange does not grant
permission to list the Shares either:
Š within three weeks from the closing date of the application lists; or
Š 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:
Š 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;
Š you or the person for whose benefit you are applying have applied for or taken up, or
indicated an interest for, or have been or will be placed or allocated (including
conditionally and/or provisionally) Hong Kong Offer Shares and International Offer
Shares;
Š your electronic application instructions through the HK eIPO White Form service are not
completed in accordance with the instructions, terms and conditions on the designated
website at www.hkeipo.hk;
Š your application instruction is incomplete;
Š your payment (or confirmation of funds, as the case may be) is not made correctly;
Š the Underwriting Agreements do not become unconditional or are terminated;
Š we or the Overall Coordinators believe that by accepting your application, it or we would
violate applicable securities or other laws, rules or regulations; or
Š your application is for more than 50% of the Hong Kong Offer Shares initially offered
under the Hong Kong Public Offering.
369


--- page 379 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
5. If there is money settlement failure for allotted Shares:
Based on the arrangements between HKSCC Participants and HKSCC, HKSCC Participants
will be required to hold sufficient application funds on deposit with their Designated Bank
before balloting. After balloting of Hong Kong Offer Shares, the Receiving Bank will collect
the portion of these funds required to settle each HKSCC Participant’s actual Hong Kong Offer
Share allotment from their Designated Bank.
There is a risk of money settlement failure. In the extreme event of money settlement failure
by a HKSCC Participant (or its Designated Bank), who is acting on your behalf in settling
payment for your allotted shares, HKSCC will contact the defaulting HKSCC Participant and
its Designated Bank to determine the cause of failure and request such defaulting HKSCC
Participant to rectify or procure to rectify the failure.
However, if it is determined that such settlement obligation cannot be met, the affected Hong
Kong Offer Shares will be reallocated to the Global Offering. Hong Kong Offer Shares applied
for by you through the broker or custodian may be affected to the extent of the settlement
failure. In the extreme case, you will not be allocated any Hong Kong Offer Shares due to the
money settlement failure by such HKSCC Participant. None of us, the Relevant Persons, the H
Share Registrar and HKSCC is or will be liable if Hong Kong Offer Shares are not allocated to
you due to the money settlement failure.
D. DESPATCH/ COLLECTION OF H SHARE CERTIFICATES AND REFUND OF
APPLICATION MONIES
You will receive one H Share certificate for all Hong Kong Offer Shares allotted to you under
the Hong Kong Public Offering (except pursuant to applications made through the HKSCC EIPO
channel where the 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 at 8:00 a.m. on Monday, June 30, 2025 (Hong
Kong time), provided that the Global Offering has become unconditional and the right of termination
described in the section headed “Underwriting” has not been exercised. Investors who trade H Shares
prior to the receipt of H Share certificates or the H Share certificates becoming valid do so entirely at
their own risk.
The right is reserved to retain any H Share certificate(s) and (if applicable) any surplus
application monies pending clearance of application monies.
370


--- page 380 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
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 50,000
Hong Kong Offer Shares or
more
Collection in person at the H
Share Registrar, Tricor
Investor Services Limited, at
17/F, Far East Finance Centre,
16 Harcourt Road, Hong Kong
Time: 9:00 a.m. to 1:00 p.m.
on Monday, June 30, 2025
(Hong Kong time)
If you are an individual, you
must not authorize any other
person to collect for you. If
you are a corporate applicant,
your authorized representative
must bear a letter of
authorization from your
corporation stamped with your
corporation’s chop.
Both individuals and
authorized representatives
must produce, at the time of
collection, evidence of identity
acceptable to the H Share
Registrar.
Note: If you do not collect
your H Share certificate(s)
personally within the time
above, it/they will be sent to
the address specified in your
application instructions by
ordinary post at your own risk
H Share certificate(s) will be
issued in the name of HKSCC
Nominees, deposited into
CCASS and credited to your
designated HKSCC
Participant’s stock account
No action by you is required
For application of less than
50,000 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: Friday, June 27, 2025
371


--- page 381 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
HK eIPO White Form service HKSCC EIPO channel
Refund mechanism for surplus application monies paid by you
Date Monday, June 30, 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 check(s) will be in
your application instructions
by ordinary post at your own
risk
1 Except in the event of a tropical cyclone warning signal number 8 or above, a black rainstorm warning and/or an “extreme conditions”
announcement issued after a super typhoon in force in Hong Kong in the morning on Friday, June 27, 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. Severe Weather Arrangements” in this section.
E. SEVERE WEATHER ARRANGEMENTS
The Opening and Closing of the Application Lists
The application lists will not open or close on Wednesday, June 25, 2025 if, there is:
Š a tropical cyclone warning signal number 8 or above;
Š a black rainstorm warning; and/or
Š an “extreme conditions” announcement issued after a super typhoon (“ Extreme
Conditions”), (collectively, “Severe Weather Signals ”),
in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Wednesday, June 25,
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 Severe Weather Signals in force at any time between 9:00 a.m.
and 12:00 noon.
Prospective investors should be aware that a postponement of the opening/closing of the
application lists may result in a delay in the listing date. Should there be any changes to the dates
mentioned in the section headed “Expected Timetable” in this prospectus, an announcement will be
made and published on the Stock Exchange’s website at www.hkexnews.hk and our website at
www.unisound.com of the revised timetable.
If a Severe Weather Signal is hoisted on Friday, June 27, 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 Monday, June 30, 2025.
372


--- page 382 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
If a Severe Weather Signal is hoisted on Friday, June 27, 2025, for application of less than
50,000 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 Severe Weather Signal is lowered or canceled
(e.g. in the afternoon of Friday, June 27, 2025 or on Monday, June 30, 2025).
If a Severe Weather Signal is hoisted on Monday, June 30, 2025, for application of 50,000
Hong Kong Offer Shares or more, physical H Share certificate(s) will be available for collection in
person at the H Share Registrar’s office after the Severe Weather Signal is lowered or canceled (e.g. in
the afternoon of Monday, June 30, 2025 or on Wednesday, July 2, 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 SHARES INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the Shares on the Stock
Exchange and we comply with the stock admission requirements of HKSCC, the Shares will be
accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect
from the date of commencement of dealings in the Shares or any other date HKSCC chooses.
Settlement of transactions between Exchange Participants is required to take place in CCASS on the
second Settlement Day after any trading day.
All activities under CCASS are subject to the General Rules of HKSCC and HKSCC
Operational Procedures in effect from time to time.
All necessary arrangements have been made enabling the Shares to be admitted into CCASS.
You should seek the advice of your broker or other professional advisor for details of the
settlement arrangement as such arrangements may affect your rights and interests.
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 bank and the Relevant Persons about
you in the same way as it applies to personal data about applicants other than HKSCC Nominees. This
personal data may include client identifier(s) and your identification information. By giving application
instructions to HKSCC, you acknowledge that you have read, understood and agree to all of the terms
of the Personal Information Collection Statement below.
1. Personal Information Collection Statement
This Personal Information Collection Statement informs the applicant for, and holder of, Hong
Kong Offer Shares, of the policies and practices of 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
373


--- page 383 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
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:
Š processing your application and refund check and HK eIPO White Form e-Auto Refund
payment instruction(s), where applicable, verification of compliance with the terms and
application procedures set out in this prospectus and announcing results of allocation of
Hong Kong Offer Shares;
Š compliance with applicable laws and regulations in Hong Kong and elsewhere;
Š registering new issues or transfers into or out of the names of the holders of the Shares
including, where applicable, HKSCC Nominees;
Š maintaining or updating the register of members of the Company;
Š verifying identities of applicants for and holders of the Shares and identifying any
duplicate applications for the Shares;
Š facilitating Hong Kong Offer Shares balloting;
Š establishing benefit entitlements of holders of the Shares, such as dividends, rights
issues, bonus issues, etc.;
Š distributing communications from the Company and its subsidiaries;
Š compiling statistical information and profiles of the holder of the Shares;
Š disclosing relevant information to facilitate claims on entitlements; and
Š any other incidental or associated purposes relating to the above and/or to enable the
Company and the H Share Registrar to discharge their obligations to applicants and
holders of the Shares and/or regulators and/or any other purposes to which applicants and
holders of the Shares may from time to time agree.
4. Transfer of personal data
Personal data held by the Company and the H Share Registrar relating to the applicants for
and holders of Hong Kong Offer Shares will be kept confidential but the Company and the H
Share Registrar may, to the extent necessary for achieving any of the above purposes,
disclose, obtain or transfer (whether within or outside Hong Kong) the personal data to, from
or with any of the following:
Š the Company’s appointed agents such as financial advisers, receiving bank and overseas
principal share registrar;
374


--- page 384 ---
HOW TO APPLY FOR HONG KONG OFFER SHARES
Š 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);
Š 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;
Š 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
Š any persons or institutions with which the holders of Hong Kong Offer Shares have or
propose to have dealings, such as their bankers, solicitors, accountants or brokers etc.
5. Retention of personal data
The Company and the H Share Registrar will keep the personal data of the applicants and
holders of Hong Kong Offer Shares for as long as necessary to fulfill the purposes for which
the personal data 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.
375


--- page 385 ---
APPENDIX I ACCOUNTANT’S REPORT
The following is the text of a report set out on pages I-1 to I-2, received from the Company’s
reporting accountant, PricewaterhouseCoopers, 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 HKSIR 200, Accountants’ Reports
on Historical Financial Information in Investment Circulars issued by the Hong Kong Institute of
Certified Public Accountants.
ACCOUNTANT’S REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE
DIRECTORS OF UNISOUND AI TECHNOLOGY CO., LTD. AND CHINA
INTERNATIONAL CAPITAL CORPORATION HONG KONG SECURITIES LIMITED AND
HAITONG INTERNATIONAL CAPITAL LIMITED
Introduction
We report on the historical financial information of Unisound AI Technology Co., Ltd. (the
“Company”) and its subsidiaries (together, the “Group”) set out on pages I-3 to I-89, which comprises
the consolidated balance sheets as at December 31, 2022, 2023 and 2024, the balance sheets of the
Company as at December 31, 2022, 2023 and 2024, and the consolidated statements of comprehensive
loss, the consolidated statements of changes in equity/(deficit) and the consolidated statements of cash
flows for each of the years ended December 31, 2022, 2023 and 2024 (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-3 to I-89 forms an
integral part of this report, which has been prepared for inclusion in the prospectus of the Company
dated June 20, 2025 (the “Prospectus”) in connection with the initial listing of H shares of the
Company on the Main Board of The Stock Exchange of Hong Kong Limited.
Directors’ responsibility for the Historical Financial Information
The directors of the Company are responsible for the preparation of Historical Financial
Information that gives a true and fair view in accordance with the basis of preparation set out in note
2.1.1 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 accountant’s 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.
I-1


--- page 386 ---
APPENDIX I ACCOUNTANT’S REPORT
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
accountant’s judgment, including the assessment of risks of material misstatement of the Historical
Financial Information, whether due to fraud or error. In making those risk assessments, the reporting
accountant considers 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
2.1.1 to the Historical Financial Information in order to design procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s
internal control. Our work also included evaluating the appropriateness of accounting policies used and
the reasonableness of accounting estimates made by the directors, as well as evaluating the overall
presentation of the Historical Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Opinion
In our opinion, the Historical Financial Information gives, for the purposes of the accountant’s
report, a true and fair view of the financial position of the Company as at December 31, 2022, 2023
and 2024 and the consolidated financial position of the Group as at December 31, 2022, 2023 and 2024
and of its consolidated financial performance and its consolidated cash flows for the Track Record
Period in accordance with the basis of preparation set out in note 2.1.1 to the Historical Financial
Information.
Report on matters under the Rules Governing the Listing of Securities on The Stock Exchange of
Hong Kong Limited (the “Listing Rules”) and the Companies (Winding Up and Miscellaneous
Provisions) Ordinance
Adjustments
In preparing the Historical Financial Information, no adjustments to the Underlying Financial
Statements as defined on page I-3 have been made.
Dividends
We refer to note 43 to the Historical Financial Information which states that no dividends have
been paid by Unisound AI Technology Co., Ltd. in respect of the Track Record Period.
PricewaterhouseCoopers
Certified Public Accountants
Hong Kong, June 20, 2025
I-2


--- page 387 ---
APPENDIX I ACCOUNTANT’S REPORT
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
accountant’s report.
The financial statements of the Group for the Track Record Period, on which the Historical
Financial Information is based, were audited by PricewaterhouseCoopers in accordance with
International Standards on Auditing issued by the International Auditing and Assurance Standards
Board (the “Underlying Financial Statements”).
The Historical Financial Information is presented in Renminbi (“RMB”) and all values are
rounded to the nearest thousand (RMB’000) except when otherwise indicated.
I-3


--- page 388 ---
APPENDIX I ACCOUNTANT’S REPORT
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
Year ended December 31,
Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000
Revenue .................................................. 6 600,619 727,316 939,017
Cost of sales and services ..................................... 9 (360,732) (432,808) (574,537)
Gross profit ............................................... 239,887 294,508 364,480
Operating expenses:
Selling and marketing expenses ................................ 9 (46,086) (58,810) (70,705)
Administrative expenses ...................................... 9 (48,420) (65,020) (64,105)
Research and development expenses ............................ 9 (287,099) (286,301) (370,073)
Net impairment losses on financial assets and contract assets ......... 3 (71,976) (91,346) (48,438)
Other income .............................................. 7 15,746 36,313 17,077
Other (losses)/gains - net ..................................... 8 (1,363) 10,579 (13,964)
Total operating expenses .................................... (439,198) (454,585) (550,208)
Finance income ............................................. 3 1 4 1,875 2,298
Finance costs ............................................... (177,675) (212,770) (270,943)
Finance costs - net .......................................... 11
(177,361)
(210,895) (268,645)
Share of profit/(loss) from investments accounted for using the equity
method ................................................. 1 3 1,092 (2,617) —
Loss before income tax ...................................... (375,580) (373,589) (454,373)
Income tax credit/(expense) ................................... 1 4 1 8 9 (2,655) 162
Loss for the year ........................................... (375,391) (376,244) (454,211)
Loss is attributable to:
Owners of the Company ...................................... (366,012) (375,461) (452,364)
Non-controlling interests ..................................... (9,379) (783) (1,847)
(375,391) (376,244) (454,211)
Other comprehensive income
Currency translation differences ................................ 8 5 2 9 4 6 0
Total other comprehensive income for the year net of tax .......... 8 5 2 9 4 6 0
Total comprehensive loss for the year ......................... (375,306) (375,950) (454,151)
Total comprehensive loss for the year is attributable to:
Owners of the Company ...................................... (365,927) (375,167) (452,304)
Non-controlling interests ..................................... (9,379) (783) (1,847)
(375,306)
(375,950) (454,151)
Loss per share attributable to owners of the Company
Basic and diluted loss per share (RMB) .......................... 1 5 (5.75) (5.57) (6.52)
I-4


--- page 389 ---
APPENDIX I ACCOUNTANT’S REPORT
CONSOLIDATED BALANCE SHEETS
As at December 31,
Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000
Assets
Non-current assets:
Property, plant and equipment ..................................... 1 6 14,533 19,160 28,081
Right-of-use assets .............................................. 1 7 12,422 8,645 10,385
Intangible assets ................................................ 1 8 5 6 0 4 9 8 8,791
Deferred income tax assets ........................................ 3 4 3 9 9 5 3 2 9 5
Investments accounted for using the equity method ..................... 1 3 2,617 — —
Financial assets at fair value through profit or loss ...................... 2 5 21,680 30,588 24,347
Financial lease receivables ........................................ 2 1 6 7 0 — 3,725
Other non-current assets .......................................... 1 9 — 47,393 47,393
Total non-current assets ......................................... 52,881 106,337 123,017
Current assets:
Inventories ..................................................... 2 4 33,614 67,853 140,292
Contract assets .................................................. 6 3,908 4,123 4,969
Trade receivables ................................................ 2 3 368,860 411,053 559,242
Prepayments and other receivables .................................. 2 2 32,170 66,256 89,530
Financial assets at fair value through profit or loss ...................... 2 5 — 69,010 —
Financial lease receivables ........................................ 2 1 3,293 750 2,909
Cash and cash equivalents ......................................... 2 6 74,118 379,224 156,476
Restricted Cash ................................................. 2 6 — — 3,541
Total current assets ............................................. 515,963 998,269 956,959
Total assets .................................................... 568,844 1,104,606 1,079,976
Equity/(deficit)
Equity/(deficit) attributable to owners of the Company
Share capital ................................................... 2 7 63,648 69,392 69,392
Treasury stock .................................................. 2 8 (1,841,637) (2,563,637) (2,563,637)
Reserves ...................................................... 2 8 1,544,548 2,245,640 2,245,700
Accumulated deficit ............................................. 2 9 (1,657,418) (2,032,879) (2,485,243)
(1,890,859) (2,281,484) (2,733,788)
Non-controlling interests .......................................... (20,379) (17,273) (19,120)
Total deficit ................................................... (1,911,238) (2,298,757) (2,752,908)
Liabilities
Non-current liabilities
Lease liabilities ................................................. 1 7 4,372 4,685 7,583
Redemption liabilities ............................................ 3 0 2,108,990 3,038,456 3,303,051
Other non-current liabilities ....................................... 3 6 45,033 26,434 29,625
Total non-current liabilities ...................................... 2,158,395 3,069,575 3,340,259
Current liabilities
Trade and other payables .......................................... 3 3 192,782 181,455 232,895
Contract liabilities ............................................... 6 55,877 64,804 86,265
Salary and welfare payable ........................................ 3 5 22,966 15,233 15,052
Borrowings .................................................... 3 7 35,000 65,000 145,378
Financial liabilities at fair value through profit or loss ................... 3 1 6 6 7 2,383 2,370
Lease liabilities ................................................. 1 7 14,395 4,913 10,665
Total current liabilities .......................................... 321,687 333,788 492,625
Total liabilities ................................................. 2,480,082 3,403,363 3,832,884
Net current assets .............................................. 194,276 664,481 464,334
Total liabilities and deficit ....................................... 568,844 1,104,606 1,079,976
I-5


--- page 390 ---
APPENDIX I ACCOUNTANT’S REPORT
BALANCE SHEETS OF THE COMPANY
As at December 31,
Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000
Assets
Non-current assets
Property, plant and equipment ................................. 1 6 4,799 9,852 10,130
Right-of-use assets .......................................... 1 7 4,423 341 4,868
Intangible assets ............................................ 1 8 3 3 1 4 0 0 2 3 7
Deferred income tax assets ................................... 1 1 1 — —
Investments in subsidiaries ................................... 12(b) 230,383 586,883 592,783
Financial assets at fair value through profit or loss ................. 2 5 21,680 30,588 22,097
Amounts due from subsidiaries, non-current ...................... 22(b) 442,859 526,106 611,549
Total non-current assets .................................... 704,586 1,154,170 1,241,664
Current assets
Inventories ................................................ 1,955 8,355 7,695
Contract assets ............................................. 6 2,596 1,918 1,030
Trade receivables ........................................... 2 3 78,944 96,657 114,639
Prepayments and other receivables ............................. 22(a) 15,032 28,058 27,839
Financial assets at fair value through profit or loss ................. 2 5 — 10,010 —
Cash and cash equivalents .................................... 2 6 31,973 84,608 12,213
Restricted Cash ............................................ 2 6 — — 5 9 0
Total current assets ........................................ 130,500 229,606 164,006
Total assets ............................................... 835,086 1,383,776 1,405,670
Equity/(deficit)
Equity/(deficit) attributable to owners of the Company
Share capital ............................................... 2 7 63,648 69,392 69,392
Treasury stock ............................................. 2 8 (1,841,637) (2,563,637) (2,563,637)
Reserves .................................................. 2 8 1,535,289 2,234,805 2,234,805
Accumulated deficit ......................................... 2 9 (1,197,818) (1,521,427) (1,938,566)
Total deficit ............................................... (1,440,518) (1,780,867) (2,198,006)
Liabilities
Non-current liabilities
Redemption liabilities ....................................... 30 2,108,990 3,038,456 3,303,051
Other non-current liabilities ................................... 36 23,657 10,158 13,975
Total non-current liabilities ................................. 2,132,647 3,048,614 3,317,026
Current liabilities
Trade and other payables ..................................... 3 3 81,226 60,533 178,708
Contract liabilities .......................................... 6 7,058 20,688 23,558
Salary and welfare payable ................................... 3 5 13,843 7,425 7,634
Borrowings ................................................ 3 7 35,000 25,000 70,000
Financial liabilities at fair value through profit or loss .............. 6 6 7 2,383 2,370
Lease liabilities ............................................ 1 7 5,163 — 4,380
Total current liabilities ..................................... 142,957 116,029 286,650
Total liabilities ............................................ 2,275,604 3,164,643 3,603,676
Net current (liabilities)/assets ............................. (12,457) 113,577 (122,644)
Total liabilities and deficit ................................... 835,086 1,383,776 1,405,670
I-6


--- page 391 ---
APPENDIX I ACCOUNTANT’S REPORT
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY/(DEFICIT)
Attributable to owners of the Company
Non-controlling
interests
Total
equity/
(deficit)
Notes
Share
capital
Treasury
stock Reserves
Accumulated
deficit Sub-total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Balance at January 1,
2022 ............... 63,573 (1,831,637) 1,531,482 (1,291,406) (1,527,988) (11,000) (1,538,988)
Comprehensive losses
Loss for the year ....... — — — ( 366,012) (366,012) (9,379) (375,391)
Currency translation
differences .......... — — 8 5 — 8 5 — 8 5
Total comprehensive
income/(losses) for the
year ............... — — 85 (366,012) (365,927) (9,379) (375,306)
Transactions with
owners in their
capacity as owners:
Issuance of equity
interests to Series D2
investors ............ 3 0 7 5 — 9,634 — 9,709 — 9,709
Modification to granted
redemption
liabilities ........... 3 0 — — 3,709 — 3,709 — 3,709
Recognition of
redemption liabilities
for the redemption
rights newly granted to
Series D2 investors . . . 30 — (10,000) — — (10,000) — (10,000)
Recognition of financial
liabilities for the anti-
dilution rights newly
granted to Series D2
investors ............ 3 1 — — (362) — (362) — (362)
Total transactions with
owners in their
capacity as owners ... 75 (10,000) 12,981 — 3,056 — 3,056
Balance at December 31,
2022 ............... 63,648 (1,841,637) 1,544,548 (1,657,418) (1,890,859) (20,379) (1,911,238)
I-7


--- page 392 ---
APPENDIX I ACCOUNTANT’S REPORT
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY/(DEFICIT) (CONTINUED)
Attributable to owners of the Company
Non-controlling
interests
Total
equity/
(deficit)
Notes
Share
capital
Treasury
stock Reserves
Accumulated
deficit Sub-total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Balance at January 1,
2023 ............. 63,648 (1,841,637) 1,544,548 (1,657,418) (1,890,859) (20,379) (1,911,238)
Comprehensive losses
Loss for the year ...... — — — (375,461) (375,461) (783) (376,244)
Currency translation
differences ........ — — 2 9 4 — 2 9 4 — 2 9 4
Total comprehensive
losses for the
year ............. — — 294 (375,461) (375,167) (783) (375,950)
Transactions with
owners in their
capacity as owners:
Issuance of equity
interests to Series D3
investors .......... 3 0 5,744 — 696,741 — 702,485 — 702,485
Modification to granted
redemption
liabilities .......... 3 0 — — 1,379 — 1,379 — 1,379
Recognition of
redemption liabilities
for the redemption
rights newly granted
to Series D3
investors .......... 3 0 — (722,000) — — (722,000) — (722,000)
Recognition of financial
liabilities for the anti-
dilution rights newly
granted to Series D3
investors .......... 3 1 — — (985) — (985) — (985)
Share-based
compensation
expenses .......... 3 2 — — 4,532 — 4,532 — 4,532
Acquisition of non-
controlling
interests ........... — — (869) — (869) 389 (480)
Capital injection from
non-controlling
interests ........... — — — — — 3,500 3,500
Total transactions
with owners in their
capacity as
owners ........... 5,744 (722,000) 700,798 — (15,458) 3,889 (11,569)
Balance at
December 31, 2023 .. 69,392 (2,563,637) 2,245,640 (2,032,879) (2,281,484) (17,273) (2,298,757)
I-8


--- page 393 ---
APPENDIX I ACCOUNTANT’S REPORT
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY/(DEFICIT) (CONTINUED)
Attributable to owners of the Company
Non-controlling
interests
Total
equity/
(deficit)
Notes
Share
capital
Treasury
stock Reserves
Accumulated
deficit Sub-total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Balance at January 1,
2024 ............. 69,392 (2,563,637) 2,245,640 (2,032,879) (2,281,484) (17,273) (2,298,757)
Comprehensive losses
Loss for the year ...... — — — (452,364) (452,364) (1,847) (454,211)
Currency translation
differences ........ — — 6 0 — 6 0 — 6 0
Total comprehensive
losses for the
year ............. — — 60 (452,364) (452,304) (1,847) (454,151)
Balance at
December 31, 2024 .. 69,392 (2,563,637) 2,245,700 (2,485,243) (2,733,788) (19,120) (2,752,908)
I-9


--- page 394 ---
APPENDIX I ACCOUNTANT’S REPORT
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year ended December 31,
Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000
Cash flows from operating activities
Cash used in operations .............................................. 4 0 (165,941) (284,666) (316,778)
Interest received .................................................... 3 1 4 1,875 2,298
Income tax paid ..................................................... — (1,324) (957)
Addition of restricted cash ............................................ — — (3,541)
Net cash used in operating activities ................................... (165,627) (284,115) (318,978)
Cash flows from investing activities
Purchase of investments in financial assets at fair value through profit or loss .... 3.3(iii) (88,900) (803,010) (82,250)
Proceeds from investments in financial assets at fair value through profit or loss.... 3.3(iii) 170,754 737,110 150,006
Payments for property, plant and equipment and intangible assets ............. (1,317) (14,962) (32,887)
Prepayments for property, plant and equipment ............................ 3 8 — (47,393) —
Payments for acquisition of non-controlling interests ....................... — (480) —
Net cash generated from/(used in) investing activities .................... 80,537 (128,735) 34,869
Cash flows from financing activities
Proceeds from issuance of equity interests to Series D2 investors .............. 3 0 10,000 — —
Proceeds from issuance of equity interests to Series D3 investors .............. 3 0 — 722,000 —
Payments of issuance costs for equity financing of Series D2 ................. (291) — —
Payments of issuance costs for equity financing of Series D3 ................. — (19,515) —
Capital injection from non-controlling interests ............................ — 3,500 —
Proceeds from borrowing from sales and leaseback ......................... — 12,000 —
Repayment of borrowing from sales and leaseback ......................... — (11,000) (1,000)
Proceeds from bank borrowings ........................................ 35,000 74,394 195,378
Repayment of bank borrowings ........................................ (4,000) (44,394) (115,000)
Interest paid for bank borrowings ....................................... (301) (2,837) (5,034)
Interest paid for borrowing from sales and leaseback ....................... — (386) (5)
Payments of lease liabilities ........................................... 1 7 (10,858) (15,787) (12,956)
Net cash generated from financing activities ............................ 29,550 717,975 61,383
Net (decrease)/increase in cash and cash equivalents ..................... (55,540) 305,125 (222,726)
Cash and cash equivalents at beginning of the year ......................... 2 6 129,650 74,118 379,224
Exchange effect on cash and cash equivalents ............................. 8 (19) (22)
Cash and cash equivalents at end of the year ............................ 2 6 74,118 379,224 156,476
I-10


--- page 395 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION
1 General information
Beijing Yunzhisheng Information Technology Co., Ltd. (ʮ̡, the
“Predecessor Company”) was incorporated in Beijing, the People’s Republic of China (the “PRC”) on
June 11, 2012 as a limited liability company. The Predecessor Company was jointly founded by Liang
Jia’en and Kang Heng (referred to as the “Founding Shareholders”). In June 2019, the Predecessor
Company was converted into a joint stock company with limited liability under the Company Law of
the PRC and was renamed as Unisound AI Technology Co., Ltd. (
ʮ̡, the
“Company”). The registered office of the Company is No. 101, 1st Floor, Building 1, Xisanqi Building
Materials City, Haidian District, Beijing, the PRC.
The Company together with its subsidiaries (collectively referred to as the “Group”) are
primarily engaged in the sales of artificial intelligence (“AI”) products and AI solutions.
2 Summary of accounting policies
The principal 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.
2.1 Material accounting policies
2.1.1 Basis of preparation
(i) Compliance with IFRS
The Historical Financial Information of the Group has been prepared in accordance with
International Financial Reporting Standards as issued by the IASB (“IFRS Accounting Standards”).
The preparation of Historical Financial Information in conformity with IFRS Accounting
Standards requires the use of certain critical accounting estimates. It also requires management to
exercise its judgment in the process of applying 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.
All relevant standards, amendments and interpretations to the existing standards that are
effective during the Track Record Period have been adopted by the Group consistently throughout the
Track Record Period.
(ii) Historical cost convention
The Historical Financial Information has been prepared on a historical cost basis, except for
certain financial assets and liabilities measured at fair value.
(iii) New and amended standards adopted by the group
The group has applied the following standards and amendments for the first time for its annual
reporting period commencing January 1, 2024:
Classification of Liabilities as Current or Non-current and Non-current liabilities with
covenants – Amendments to IAS 1;
I-11


--- page 396 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.1 Material accounting policies (continued)
2.1.1 Basis of preparation (continued)
(iii) New and amended standards adopted by the group (continued)
Lease Liability in Sale and Leaseback – Amendments to IFRS 16; and
Supplier Finance Arrangements – Amendments to IAS 7 and IFRS 7.
The amendments listed above did not have any material impact on the amounts recognized in
prior periods and are not expected to significantly affect the current or future periods.
(iv) New/amended standards and interpretations not yet adopted
The Group has not early applied the following new /amended amendments to IFRS Accounting
Standards that have been issued but are not yet effective:
Effective for annual periods
beginning on or after
Amendments to IAS 21 – Lack of Exchangeability January 1, 2025
Amendments to IFRS 9 and IFRS 7 – Amendments to the Classification
and Measurement of Financial Instruments
January 1, 2026
IFRS 19 Subsidiaries without Public Accountability: Disclosures January 1, 2027
IFRS 18 Presentation and Disclosure in Financial Statements January 1, 2027
IFRS 18 will replace IAS 1 Presentation of financial statements, introducing new requirements
that will help to achieve comparability of the financial performance of similar entities and provide
more relevant information and transparency to users. Even though IFRS 18 will not impact the
recognition or measurement of items in the financial statements, its impacts on presentation and
disclosure are expected to be pervasive, in particular those related to the statement of financial
performance and providing management-defined performance measures within the financial
statements.
Management is currently assessing the implication of applying IFRS 18, and preliminarily
identified the fair value gains/(losses) on financial assets currently presented in the line item ‘Other
(losses)/gains—net’ within operating profit would be presented below operating profit, and certain
additional disclosures would be added, other than that, there would not be significant impact on the
Group’s financial position and performance when adopting IFRS 18.
Except for the impact of IFRS 18 above, other new/amended standards are either not relevant to
the Group or not expected to have a material impact on the Group’s consolidated financial statements
when they become effective.
(v) Going concern
The Group’s net liabilities were approximately RMB1,911.2 million, RMB2,298.8 million and
RMB2,752.9 million on December 31, 2022, 2023 and 2024, respectively. These net liabilities were
mainly due to the redemption rights granted to investors in financing of Series Angel, A, B, B+, C, C+,
I-12


--- page 397 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.1 Material accounting policies (continued)
2.1.1 Basis of preparation (continued)
(v) Going concern (continued)
C3, D, D+, D1, D2 and D3 (the “Investors”) for which the Group recorded redemption liabilities with
carry values of RMB2,109.0 million, RMB3,038.5 million and RMB3,303.1 million on December 31,
2022, 2023 and 2024, respectively (note 30(i)).
According to the investment agreements, the Investors agreed that all the preferred rights
including redemption rights granted shall be irretrievably terminated upon the Company achieving
QIPO. Please refer to note 30(i) for the relevant agreements for termination and reinstatement of the
preferred rights. In any situation, the preferred rights and related liabilities will not have a cash flow
impact to the Group in the next twelve months from the end of the reporting period.
Based on the cash flow projections of the Group and taking into account the available financial
resources, including cash and cash equivalents, the directors of the Company are of the opinion that the
Group will have sufficient working capital to meet in full its financial obligations as they fall due for at
least the next twelve months from the end of the reporting period and accordingly, the Historical
Financial Information has been prepared on a going concern basis.
The Historical Financial Information has been prepared in accordance with the accounting
policies as set out in note 2.
2.1.2 Trade receivables
Trade receivables are amounts due from customers for goods sold or services provided 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
3.1 for a description of the Group’s impairment policies.
2.1.3 Share capital and treasury stock
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of
new shares are shown in equity as a deduction, net of tax, from the proceeds.
Where any group company purchases its equity instruments, the consideration paid, including
any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to
the owners of the Company as treasury stock until the shares are canceled or reissued. Where such
shares are subsequently reissued, any consideration received, net of any directly attributable
incremental transaction costs and the related income tax effects, is included in equity attributable to the
owners of the Company.
I-13


--- page 398 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.1 Material accounting policies (continued)
2.1.3 Share capital and treasury stock (continued)
Treasury stock is recorded to reflect the carrying amount of the redemption liabilities when it is
initially reclassified from equity and will be reversed back to equity when the redemption liabilities are
derecognized upon the Group’s obligations in connection with those redemption liabilities are
discharged, canceled or expired.
2.1.4 Redemption liabilities
A contract that contains an obligation to purchase the Company’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 Company’s obligations to purchase is conditional on the counterparty exercising a right to
redeem. The Company undertakes such redemption obligations as certain preferred rights are granted
to the Investors in the Company’s financing process, such redemption obligation is recognized as
financial liability initially at the present value of the redemption amount and subsequently measured at
amortized cost with interest charged in finance costs.
The Group derecognizes redemption liabilities when, and only when, the redemption
obligations are discharged, canceled or expired. The carrying amount of the redemption liabilities
derecognized is then credited into equity.
2.1.5 Financial liabilities at fair value through profit or loss
The Investors were granted with preferred rights, such as an “anti-dilution right”, pursuant to
which the Investors have a right to require: (1) the Founding Shareholders to transfer the equity
interests of the Company they directly or indirectly held to the Investors at the lowest price allowed by
law; or (2) the Company to issue new shares for nominal consideration to the Investors; or (3) the
Company or Founding Shareholders to compensate the Investors in cash. The specific method shall be
selected and determined by the Investors, and the Company and its Founding Shareholders shall be
liable for this jointly and severally. The anti-dilution right is out of the control of the Company.
Any anti-dilution right granted is bifurcated and accounted for within financial liabilities at fair
value through profit or loss. It is initially recognized at fair value and subsequently carried at fair value
with fair value changes recognized in “Other (losses)/gains—net” in the consolidated statements of
comprehensive loss. The financial liabilities are classified as non-current liabilities unless the
Company has an obligation to settle the liabilities within 12 months after the end of the reporting
period.
The Company derecognizes such financial liabilities when, and only when, the Company’s
obligations are discharged, canceled or have expired. The carrying amount of the financial liabilities
derecognized is then credited into equity.
I-14


--- page 399 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.1 Material accounting policies (continued)
2.1.6 Share-based payments
(i) Equity-settled share-based payment transactions
The Group operates certain share incentive plans, under which it receives services from
employees as consideration for equity instruments (“options”) of the Group. The fair value of services
received in exchange for the grant of equity instruments is recognized as an expense in the
consolidated statement of comprehensive income with a corresponding increase in equity.
In terms of the options awarded to employees, the total amount to be expensed is determined by
reference to the fair value of the options granted:
Š including any market performance conditions;
Š excluding the impact of any service and non-market performance vesting conditions; and
Š including the impact of any non-vesting conditions.
Service and non-marketing performance vesting conditions are included in the calculation of
the number of options that are expected to vest. The total amount expensed 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 options that are
expected to vest based on the service conditions and non-marketing vesting performance conditions. It
recognizes the impact of the revision to original estimates, if any, in profit or loss, with a
corresponding adjustment to equity.
In some circumstances, employees may provide services in advance of the grant date and
therefore the grant date fair value is estimated for the purposes of recognizing the expense during the
period between service commencement date and grant date.
When the share options are forfeited after the vesting date or are still not exercised at the expiry
date, the amount previously recognized in reserves will continue to be held in reserves.
(ii) Cash-settled share-based payment transactions
The cost of cash-settled transactions is measured initially at fair value on the grant date, with a
corresponding recognition of liability. The liability is re-measured at each reporting date up to and at
the date of settlement, with any changes in fair value recognized in profit or loss for the period.
(iii) Modifications
Where the terms of the share-based payment plan are modified, the expense that is not yet
recognized for the award is recognized over the remaining vesting period as if the terms had not been
modified.
If a modification increases the fair value of the equity instruments granted, the incremental fair
value granted is included in the measurement of the amount recognized for the services received over
I-15


--- page 400 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.1 Material accounting policies (continued)
2.1.6 Share-based payments (continued)
(iii) Modifications (continued)
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.
If the Group modifies the terms or conditions of its equity instruments granted in a manner that
reduces the total fair value of the share-based payment arrangement, or is not otherwise beneficial to
the employee, the Group shall nevertheless continue to account for the services received as
consideration for the equity instruments granted as if that modification had not occurred.
2.1.7 Revenue recognition
Revenue is recognized when, or as, the control of goods or services is transferred to the
customers. Depending on the terms of the contracts and the laws applicable, control of the goods and
services may be transferred over time or at a point in time.
Control of the goods and services is transferred over time if the Group’s performance:
Š provides all the benefits received and consumed simultaneously by the customers;
Š creates or enhances an asset that the customers control as the Group performs; or
Š does not create an asset with an alternative use to the Group and the Group has an
enforceable right to payment for performance completed to date.
If control of the goods and services transfers over time, revenue is recognized over the period
of the contract by reference to the progress towards complete satisfaction of that performance
obligation. Otherwise, revenue is recognized at a point in time when the customer obtains control of
the goods and services.
Contracts with customers may include multiple performance obligations. For such
arrangements, the Group allocates revenue to each performance obligation based on its relative
standalone selling price. The Group generally determines standalone selling prices based on the prices
charged to customers. If the standalone selling price is not directly observable, it is estimated using
expected cost plus a margin approach or residual approach, depending on the availability of observable
information. Assumptions and estimations have been made in estimating the relative selling price of
each distinct performance obligation, and changes in judgments on these assumptions and estimates
may impact the revenue recognition.
A contract asset is the Group’s right to consideration in exchange for goods and services that
the Group has transferred to a customer. A receivable is recorded when the Group has 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.
I-16


--- page 401 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.1 Material accounting policies (continued)
2.1.7 Revenue recognition (continued)
If a customer pays consideration or the Group has a right to an amount of consideration that is
unconditional, before the Group transfers a good or service to the customers, the Group presents the
contract as a contract liability when the payment is made, or the receivable is recorded (whichever is
earlier). A contract liability is the Group’s obligation to transfer goods or services to a customer for
which the Group has received consideration (or an amount of consideration is due) from the customers.
The revenue is measured at the transaction price agreed under the contract. Amounts disclosed
as revenue are net of returns, trade allowances and amounts collected on behalf of third parties. In
those agreements where the transaction period between the transfer of the promised goods or services
to the customer and payment by the customer exceeds one year, revenue is measured at transaction
prices adjusted for the time value of money. The variable consideration is estimated by applying the
most likely amount method.
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 first identifies 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 include but
are 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 circumstance.
The Group categorizes its revenue based on different application scenarios, i.e., Daily life and
Healthcare.
Daily life
Revenue from goods and services used for residential, commercial spaces or transportation
purpose is categorized under Daily life. For AI solutions, revenue is recognized at a point in time when
the integrated hardware and software are delivered to the customer’s designated place and accepted by
the customer after installation and trial run is completed. For AI products, revenue is recognized at a
point in time when the AI products are delivered to the customer’s designated place, accepted by the
customer. For certain AI platform services that are provided during a period, such as speaking
evaluation services, revenue is recognized over time.
Healthcare
Revenue from audio medical transcription solutions, AI in medical record quality management
solutions and other AI empowered medical solutions to medical institutions is categorized under
Healthcare. Revenue is recognized upon customer acceptance after the system is launched and a trial
run is completed.
I-17


--- page 402 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.1 Material accounting policies (continued)
2.1.7 Revenue recognition (continued)
Healthcare (continued)
The Group has analyzed the nature of goods and services included in each of the contracts to
assess whether there are different performance obligations as below:
The Group provides standalone AI products, such as AI software, software-embedded
hardware, and AI platform services separately, in which cases revenue is recognized separately. The
Group also provides AI solutions which are an integration of AI software, hardware, infrastructure and
technology services. These components are assessed by management to be highly interdependent and
interrelated, and therefore they are accounted for as a single performance obligation. Cloud services in
certain AI solutions and certain AI products are accounted for as a separate performance obligation and
revenue is recognized over the period of cloud services committed.
Warranties provided for these AI solutions and AI products are normally for periods within 2
years and are regarded as assurance-type warranties, while any extension of warranties extended for
periods normally beyond two years are regarded as service-type warranties. The assurance-type
warranties are accounted for in accordance with note “2.2.15 Provisions”, and the service-type
warranties are accounted for as a separate performance obligation and the transaction price will be
allocated to each performance obligation based on the standalone selling prices.
2.1.8 Leases
The Group assesses whether a contract is or contains a lease at inception of a contract. It
recognizes right-of-use assets and corresponding lease liabilities with respect to all lease contracts in
which it is the lessee, except for short-term leases (defined as leases with a lease term of 12 months or
less) and leases of low value assets, at the date at which the leased asset is available for use by the
Group.
(i) As lessee
Contracts may contain both lease and non-lease components. The Group allocates the
consideration in the contract to the lease and non-lease components based on their relative stand-alone
prices.
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:
Š fixed payments (including in-substance fixed payments), less any lease incentives
receivable,
Š variable lease payment that are based on an index or a rate, initially measured using the
index or rate as at the commencement date,
Š amounts expected to be payable by the Group under residual value guarantees,
Š 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.
I-18


--- page 403 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.1 Material accounting policies (continued)
2.1.8 Leases (continued)
(i) As lessee (continued)
Lease payments to be made under reasonably certain extension options are also included in the
measurement of the liability.
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.
Lease payments are allocated between principal and finance cost. The finance cost is charged to
profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining
balance of the liability for each period.
Right-of-use assets are measured at cost comprising the following:
Š the amount of the initial measurement of lease liability,
Š any lease payments made at or before the commencement date less any lease incentives
received,
Š any initial direct costs, and
Š restoration costs.
Right-of-use assets are generally depreciated over the shorter of the asset’s useful life and the
lease term on a straight-line basis. If the Group is reasonably certain to exercise a purchase option, the
right-of-use asset is depreciated over the underlying asset’s useful life.
Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of
the underlying asset and recognized as expense over the lease term on the same basis as lease income.
The respective leased assets are included in the balance sheet based on their nature.
Payments associated with short-term leases of equipment and vehicles and all leases of
low-value assets are recognized on a straight-line basis as an expense in profit or loss.
(ii) As lessor
When the Company acts as a lessor, it determines at lease inception whether each lease is a
finance lease or an operating lease. A lease is classified as a finance lease if it transfers substantially all
the risks and rewards incidental to the ownership of an underlying assets to the lessee. If this is not the
case, the lease is classified as an operating lease.
(iii) Sublease
In a sublease where the Company is both a lessee and a lessor for the same underlying asset, the
Company separately accounts for the head lease and sublease unless it is relieved of its primary
obligation under the head lease.
I-19


--- page 404 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.1 Material accounting policies (continued)
2.1.8 Leases (continued)
(iii) Sublease (continued)
The Company firstly determines the classification of the sublease based on the underlying asset.
For a sublease classified as a financial lease, the Company derecognizes the right-of-use asset
and recognizes the net investment in the sublease. Finance income on the sublease and interest expense
on the head lease are recognized in the other (losses)/gains – net and finance costs respectively.
For a sublease classified as an operating lease, the Company retains the right-of-use asset,
recognizes a depreciation charge for the right-of-use asset and interest on the lease liability, and
recognizes lease income from the sublease. Lease income from operating leases where the Group is a
lessor is recognized in revenue on a straight-line basis over the lease term.
2.2 Other accounting policies
2.2.1 Principles of consolidation and equity accounting
(i) 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.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the
consolidated statements of comprehensive loss, statements of changes in equity/(deficit) and balance
sheets respectively.
(ii) Associates
Associates are all entities over which the Group has significant influence but not control or
joint control. This is generally the case where the Group holds between 20% and 50% of the voting
rights. Investments in associates are accounted for using the equity method of accounting (see
(iii) below), after initially being recognized at cost.
(iii) Equity method
Under the equity method of accounting, the investments are initially recognized at cost and
adjusted thereafter to recognize the Group’s share of the post-acquisition profits or losses of the
I-20


--- page 405 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.1 Principles of consolidation and equity accounting (continued)
(iii) Equity method (continued)
investee in profit or loss, and the Group’s share of movements in other comprehensive income of the
investee in other comprehensive income. Dividends received or receivable from associates are
recognized as a reduction in the carrying amount of the investment.
Where the Group’s share of losses in an equity-accounted investment equals or exceeds its
interest in the entity, including any other unsecured long-term receivables, the Group does not
recognize further losses, unless it has incurred obligations or made payments on behalf of the other
entity.
Unrealized gains on transactions between the Group and its associates are eliminated to the
extent of the Group’s interest in these entities. Unrealized losses are also eliminated unless the
transaction provides evidence of an impairment of the asset transferred. Accounting policies of equity-
accounted investees have been changed where necessary to ensure consistency with the policies
adopted by the Group.
The carrying amount of equity-accounted investments is tested for impairment in accordance
with the policy described in note 2.2.4.
(iv) Changes in ownership interests
When the Group ceases to consolidate or equity account for an investment because of a loss of
control, or significant influence, any retained interest in the entity is remeasured to its fair value with
the change in carrying amount recognized in profit or loss. This fair value becomes the initial carrying
amount for the purposes of subsequently accounting for the retained interest as an associate, joint
venture or financial asset. In addition, any amounts previously recognized in other comprehensive
income in respect of that entity are accounted for as if the Group had directly disposed of the related
assets or liabilities. This may mean that amounts previously recognized in other comprehensive income
are reclassified to profit or loss or transferred to another category of equity as specified/ permitted by
the applicable IFRS Accounting Standards.
2.2.2 Separate financial statements
Investments in subsidiaries are accounted for at cost less impairment. Cost includes direct
attributable costs of investment. The results of subsidiaries are accounted for by the Company on the
basis of dividends received and receivable.
Impairment testing of the investments in subsidiaries is required upon receiving a dividend
from these investments if the dividend exceeds the total comprehensive income of the subsidiary in the
period 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.
I-21


--- page 406 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.3 Segment reporting
Operating segment is reported in a manner consistent with the internal reporting provided to the
chief operating decision maker (“CODM”). The CODM, who is responsible for allocating resources,
assessing performance of the operating segment, has been identified as the chief executive officer of
the Group.
2.2.4 Impairment of non-financial assets
Assets that have a definite useful life are tested for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. Assets that have an indefinite
useful life are not subject to amortization and are tested annually for impairment, or more frequently if
events or changes in circumstances indicate that they might be impaired. An impairment loss is
recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The
recoverable amount is the higher of an asset’s fair value less costs of disposal 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 other than goodwill that suffered an impairment
are reviewed for possible reversal of the impairment at the end of each reporting period.
2.2.5 Investments and other financial assets
(i) Classification
The Group classifies its financial assets in the following measurement categories:
Š those to be measured subsequently at fair value (either through other comprehensive
income (‘OCI’) or through profit or loss), and
Š those to be measured at amortized cost.
The classification depends on the entity’s business model for managing the financial assets and
the contractual terms of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or
OCI. 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 fair value through other comprehensive income (FVOCI).
The Group reclassifies debt investments when and only when its business model for managing
those assets changes.
(ii) Recognition and derecognition
Regular way purchases and sales of financial assets are recognized on the 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.
I-22


--- page 407 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.5 Investments and other financial assets (continued)
(iii) Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a
financial asset not at fair value through profit or loss (FVPL), transaction costs that are directly
attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at
FVPL 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 two measurement
categories into which the Group classifies its debt instruments:
Š 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
statement of comprehensive income.
Š FVOCI: Assets that are held for collection of contractual cash flows and for selling the
financial assets, where the assets’ cash flows represent solely payments of principal and
interest, are measured at FVOCI. 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 losses are presented as separate line item in the consolidated income
statements.
Š FVPL: Assets that do not meet the criteria for amortized cost or FVOCI are measured at
FVPL. A gain or loss on a debt investment that is subsequently measured at FVPL is
recognized in profit or loss and presented net within “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
I-23


--- page 408 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.5 Investments and other financial assets (continued)
(iii) Measurement (continued)
Equity instruments (continued)
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 FVPL are recognized in profit or loss and
presented within “other gains/(losses)—net” in the statement of comprehensive income as applicable.
Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are
not reported separately from other changes in fair value.
(iv) Impairment
The Group assesses on a forward-looking basis for the expected credit losses on financial assets
(including trade receivables, other receivables, lease receivables, and cash and cash equivalent), which
is subject to impairment under IFRS 9. The impairment methodology applied depends on whether there
has been a significant increase in credit risk.
For trade receivables, the Group applies the simplified approach permitted by IFRS 9, which
requires expected lifetime losses to be recognized from initial recognition of the receivables, see note
3.1 (b) and note 23 for details.
For other financial assets, it is measured as either 12-month expected credit losses or lifetime
expected credit loss, depending on whether there has been a significant increase in credit risk since
initial recognition. If a significant increase in credit risk of a receivable has occurred since initial
recognition, then impairment is measured as lifetime expected credit losses.
2.2.6 Offsetting financial instruments
Financial assets and liabilities are offset, and the net amount is reported in the balance sheet
where the Company currently has a legally enforceable right to offset the recognized amounts, and there
is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. The
legally enforceable right must not be contingent on future events and must be enforceable in the normal
course of business and in the event of default, insolvency or bankruptcy of the Group or the counterparty.
2.2.7 Inventories
Inventories are stated at the lower of cost and net realizable value. Cost comprises direct
materials, direct labor and an appropriate proportion of variable and fixed overhead expenditure, the
latter being allocated on the basis of normal operating capacity. Cost of direct material is determined
on weighted average basis. Net realizable value is the estimated selling price in the ordinary course of
business, less the estimated costs of completion and the estimated costs necessary to make the sale.
I-24


--- page 409 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.7 Inventories (continued)
For contract fulfillment cost, it mainly comprises direct hardware and software costs, as well as
direct labor cost incurred while delivering the AI solutions to the customers. The contract fulfillment
cost is recognized as assets and presented in inventory only if those costs meet all of the following
criteria:
Š the costs relate directly to a contract or to an anticipated contract that the entity can
specifically identify;
Š the costs generate or enhance resources of the entity that will be used in satisfying (or in
continuing to satisfy) performance obligations in the future; and
Š the costs are expected to be recovered.
The contract fulfillment cost recognized will be transferred directly to profit or loss at the time
that related revenue of AI solutions is recognized.
The Group recognizes an impairment loss in profit or loss to the extent that the carrying amount
of contract fulfillment cost recognized exceeds:
Š the remaining amount of consideration that the entity expects to receive in exchange for
the services to which the asset relates; less
Š the costs that relate directly to providing those services and that have not been recognized
as expenses.
2.2.8 Prepayments and other receivables
Prepayments and other receivables comprise mainly upfront payments made to suppliers,
deductible value-added tax (“VAT”), deposits and others.
Prepayments to suppliers for services will be subsequently recorded in the consolidated
statements of comprehensive income in accordance with the applicable performance requirements
within one year or less and therefore are all classified as current assets.
Prepayments to suppliers due for transfer to property, plant and equipment are classified as
other non-current assets.
2.2.9 Cash and cash equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents
includes cash on hand, deposits held at call with banks, 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.
I-25


--- page 410 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.10 Trade and other payables
Trade and other payables are obligations to pay for goods or services that have been acquired in
the ordinary course of business from suppliers. Trade and other payables are classified as current
liabilities if payment is due within one year or less (or in the normal operating cycle of the business if
longer). If not, they are presented as non-current liabilities.
Trade and other payables are recognized initially at fair value and subsequently measured at
amortized cost using the effective interest method.
2.2.11 Borrowings
Borrowings are initially recognized at fair value, net of transaction costs incurred, and
subsequently measured at amortized cost. Any difference between the proceeds (net of transaction
costs) and the redemption amount is recognized in profit or 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 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 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 removed from the consolidated balance sheets when the obligation specified in
the contract is discharged, canceled or expired. The difference between the carrying amount of a
financial liability that has been extinguished or transferred to another party and the consideration paid,
including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss 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 the reporting period.
2.2.12 Borrowing costs
General and specific borrowing costs that are directly attributable to an acquisition,
construction or production of a qualifying asset are capitalized during the period 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 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.
2.2.13 Income tax
The income tax comprises current and deferred income tax. The income tax expense or credit
for the period is recognized in the consolidated statement of comprehensive income, except to the
I-26


--- page 411 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.13 Income tax (continued)
extent that it relates to items recognized in other comprehensive income or directly in equity, in which
case the income tax is also recognized in other comprehensive income or directly in equity,
respectively.
(i) 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 the reporting period in the countries where the Company and its
subsidiaries and associates 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. It establishes provisions where appropriate on the basis of amounts expected to be paid
to the tax authorities.
(ii) 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 consolidated
financial statements. 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. Deferred income tax is determined
using tax rates (and laws) that have been enacted or substantially enacted by the end of the 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 income tax assets are recognized only if it is probable that future taxable amounts will
be available to utilize those temporary differences and losses.
(iii) Offsetting
Deferred income tax assets and liabilities are offset where there is a legally enforceable right to
offset current income tax assets and liabilities and where the deferred income tax balances relate to the
same taxation authority. Current income 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.
2.2.14 Employee benefits
(i) Pension obligations, housing funds and other social welfare benefits
Full-time employees of the Group in the mainland China are entitled to staff welfare benefits
including pension, work-related injury benefits, maternity insurances, medical insurances,
unemployment benefits and housing fund plans through a PRC government-mandated defined
contribution plan. Chinese labor regulation requires that the Group make contributions to the
I-27


--- page 412 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.14 Employee benefits (continued)
(i) Pension obligations, housing funds and other social welfare benefits (continued)
government for these benefits based on certain percentage of the employees’ salaries, up to a
maximum amount specified by the local government. The Group has no legal obligation for the
benefits beyond the required contributions. Under these plans, the Group contributes on a monthly
basis and expensed as incurred. The Group has no further payment obligation for post-retirement
benefits beyond the required contributions.
(ii) Bonus plans
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.
(iii) 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 the reporting period are discounted to present value.
(iv) Employees leave entitlements
Employee entitlements to annual leave are recognized when they accrue to employees. A
provision is made for the estimated liability for annual leave as a result of services rendered by
employees up to the balance sheet date. Employee entitlements to sick leave and maternity leave are
not recognized until the time of leave.
2.2.15 Provisions
Provisions are 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. Provisions are not recognized for future operating losses.
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.
I-28


--- page 413 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.15 Provisions (continued)
Provisions are measured at the present value of management’s best estimate of the expenditure
required to settle the present obligation at the end of the reporting period. The discount rate used to
determine the present value is a pre-tax rate that reflects current market assessments of the time value
of money and the risks specific to the liability. The increase in the provision due to the passage of time
is recognized as interest expense.
2.2.16 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.
Government grants relating to expenses items are deferred and recognized in the consolidated
statement of comprehensive income over the period necessary to match them with the expenses that
they are intended to compensate.
Government grants relating to property and equipment, and other non-current assets are
included in liabilities and are credited to comprehensive income on a straight-line basis over the
expected lives of the related assets.
2.2.17 Interest income
Interest income from financial assets at FVPL is included in the net fair value gains/(losses) on
these assets. Interest income from financial assets at amortized cost and financial assets at FVOCI
calculated using the effective interest method is recognized in profit or loss as part of other income.
Interest income from current deposits is included in finance income.
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).
2.2.18 Loss per share
(i) Basic loss per share
Basic loss per share is calculated by dividing:
Š the loss attributable to owners of the Company, excluding any costs of servicing equity
other than ordinary shares,
Š by the weighted average number of ordinary shares outstanding during the financial year,
adjusted for bonus elements in ordinary shares issued during the year and excluding
treasury shares.
I-29


--- page 414 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.18 Loss per share (continued)
(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:
Š the after-income tax effect of interest and other financing costs associated with dilutive
potential ordinary shares, and
Š the weighted average number of additional ordinary shares that would have been
outstanding assuming the conversion of all dilutive potential ordinary shares.
2.2.19 Property, plant and equipment
Property, plant and equipment are stated at historical cost less accumulated depreciation and
impairment losses (if any). 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 reporting period in which they are incurred.
Depreciation is calculated using the straight-line method to allocate their cost, net of their
residual values, over their estimated useful lives, as follows:
Š Electronic equipment 3 years
Š Office furniture 3-5 years
Š Leasehold improvement Shorter of remaining lease term or 5 years
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 2.2.4).
Gains and losses on disposals are determined by comparing proceeds with carrying amount and
are recognized in other (losses)/gains – net in the consolidated statement of comprehensive loss.
2.2.20 Intangible assets
(i) Software
Acquired software is initially capitalized on the basis of the costs incurred to acquire. Costs
associated with maintaining computer software programs are recognized as an expense when incurred.
Software is stated at historical cost less accumulated amortization and impairment losses (if any).
I-30


--- page 415 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.20 Intangible assets (continued)
(i) Software (continued)
The Group amortizes software with a limited useful life using the straight-line method over
1-10 years. The amortization period and amortization method are reviewed at each reporting period.
The effects of any revision are recognized as profit or loss when the changes arise.
(ii) Research and development
Research expenditure is recognized as expense when incurred. Development costs that are
directly attributable to the design and testing of identifiable and unique software products controlled by
the Group are recognized as intangible assets when the following criteria are met:
Š it is technically feasible to complete the software so that it will be available for use,
Š management intends to complete the software and use or sell it,
Š there is an ability to use or sell the software,
Š it can be demonstrated how the software will generate probable future economic benefits,
Š adequate technical, financial and other resources to complete the development and to use
or sell the software are available, and
Š the expenditure attributable to the software during its development can be reliably
measured.
Development costs previously recognized as an expense are not recognized as an asset in a
subsequent period.
During the Track Record Period, there were no internally generated development costs that met
the criteria listed above and capitalized as intangible assets.
2.2.21 Foreign currency translation
(i) 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’). Functional currency of the Company and its subsidiaries incorporated in mainland China is
Renminbi (“RMB”). Functional currency of the Company’s subsidiary in Hong Kong is US Dollar
(“USD”). As the major operations of the Group are within the mainland China, the Group determined
to present the Historical Financial Information in RMB.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange
rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of
I-31


--- page 416 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
2 Summary of accounting policies (continued)
2.2 Other accounting policies (continued)
2.2.21 Foreign currency translation (continued)
(ii) Transactions and balances (continued)
such transactions and from the translation of monetary assets and liabilities denominated in foreign
currencies at year end exchange rates are generally recognized in profit or loss, except when deferred
in equity if they are attributable to part of the net investment in a foreign operation.
Foreign exchange gains and losses that relate to borrowings are presented in the statement of
comprehensive income, within finance costs. All other foreign exchange gains and losses are presented
in the statement of comprehensive income on a net basis within “other (losses)/gains—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.
(iii) Group companies
The results and financial position of foreign operations (none of which has the currency of a
hyperinflationary economy) that have a functional currency different from the presentation currency
are translated into the presentation currency as follows:
Š assets and liabilities for each balance sheet presented are translated at the closing rate at
the date of that balance sheet.
Š income and expenses for each statement of profit or loss and statement of comprehensive
income are translated at average exchange rates (unless this is not a reasonable
approximation of the cumulative effect of the rates prevailing on the transaction dates, in
which case income and expenses are translated at the dates of the transactions), and
Š all resulting exchange differences are recognized in other comprehensive income.
On consolidation, exchange differences arising from the translation of any net investment in
foreign entities are recognized in other comprehensive income. When a foreign operation is sold or any
borrowings forming part of the net investment are repaid, the associated exchange differences are
reclassified to profit or loss, as part of the gain or loss on sale.
2.2.22 Dividend distribution
Dividend distribution to the Company’s shareholders is recognized as a liability in the
consolidated financial statements in the year in which the dividends are approved by the Company’s
shareholders or directors, where appropriate.
During the Track Record Period, there was no dividend distribution.
I-32


--- page 417 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management
3.1 Financial risk factors
The Group’s activities expose it to a variety of financial risks: market risk (including foreign
exchange risk, interest rate risk, and price 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. The Group does not use any derivative
financial instruments to hedge certain risk exposures during the Track Record Period.
(a) Market risk
(i) Foreign exchange risk
Foreign exchange risk primarily arises from recognized assets and liabilities denominated in a
currency that is not the respective group entities’ functional currency. The Group mainly operates in
the PRC with most of the transactions settled in RMB.
The Group’s exposure to foreign exchange risk on December 31, 2022, 2023 and 2024 was
insignificant as each of the group entities did not hold significant assets and liabilities denominated in a
currency other than its functional currency.
(ii) Interest rate risk
The Group’s interest rate risk primarily arises from redemption liabilities, borrowings, lease
liabilities and cash and cash equivalents. 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.
If the interest rate of borrowings with a floating rate had been 10% higher/lower, the loss before
income tax for the years ended December 31, 2022, 2023 and 2024 would have been approximately
RMB34.0 thousand, RMB280.8 thousand and RMB504.7 thousand higher/lower, respectively. This
analysis does not include the effect of interest capitalized.
If the interest rate of cash and cash equivalents had been 10% higher/lower, the loss before
income tax for the years ended December 31, 2022, 2023 and 2024 would have been approximately
RMB31.4 thousand, RMB187.5 thousand and RMB36.5 thousand lower/higher, respectively.
The fair value interest rate risk arises from financial assets and liabilities carried at fixed rates is
not significant for the Group.
The Group regularly monitors its interest rate risk to ensure there is no undue exposure to
significant interest rate movements.
(iii) Price risk
The Group is exposed to price risk in respect of the long-term investments, and wealth
management products held by the Group and classified in the balance sheet as financial assets at
FVPL. The Group is not exposed to commodity price risk. To manage its price risk arising from the
investments, the Group diversifies its portfolio. The investments are managed by management one by
I-33


--- page 418 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.1 Financial risk factors (continued)
(a) Market risk (continued)
(iii) Price risk (continued)
one, either for strategic purposes, or for the purpose of achieving investment yield and balancing the
Group’s liquidity level simultaneously. The sensitivity analysis is performed by management, see note
3.3 for details.
(b) Credit risk
(i) Risk management
The Group is exposed to credit risk primarily in relation to its cash and cash equivalents, trade
receivables, contract assets, financial lease receivables and other receivables (included in “prepayments
and other receivables”). The carrying amount of each class of the above financial assets represents the
Group’s maximum exposure to credit risk in relation to the corresponding class of financial assets.
To manage this risk arising from cash and cash equivalents, the Group only transacts with state-
owned or national financial institutions in the PRC. There has been no recent history of default in
relation to these financial institutions.
To manage risk arising from trade receivables and contract assets, the Group has policies in
place to ensure that sales with credit terms are made to counterparties with an appropriate credit history
and the management performs ongoing credit evaluations of its counterparties. The credit period
granted to the customers is usually no more than 180 days and the credit quality of these customers is
assessed by taking into account their financial position, past experience and other factors. The
Company is in the progress of enhancing the collection of existing receivables, it plans to enforce a
more stringent customer admission policy, considering factors such as the historic overdue amount and
duration of previous contracts.
For other receivables (included in “prepayments and other receivables”) and financial lease
receivables, management makes periodic collective assessments as well as individual assessments on
the recoverability of other receivables based on historical settlement records and past experiences. In
view of the history of cooperation with debtors and the collection history of receivables due from them,
management believes that the credit risk inherent in the Group’s outstanding other receivables balances
due from them is low.
(ii) Impairment of financial assets and contract assets
The Group performs impairment assessments under the expected credit loss (“ECL”) model on
financial assets at amortized cost (mainly including trade receivables, other receivables and financial
lease receivables) and contract assets. The amount of ECL is updated at each reporting date to reflect
changes in credit risk since initial recognition.
I-34


--- page 419 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.1 Financial risk factors (continued)
(b) Credit risk (continued)
(ii) Impairment of financial assets and contract assets (continued)
Cash and cash equivalents
While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, the
impairment loss is immaterial, as they are mainly placed with state-owned banks in the PRC, and there
has been no recent history of default in relation to these banks. 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.
Trade receivables and contract assets
The Group applies the IFRS 9 simplified approach to measuring expected credit losses under
which the lifetime expected credit losses for all trade receivables and contract assets are estimated. To
measure the expected credit losses, trade receivables and contract assets have been grouped based on
shared credit risk characteristics, such as the nature of customers and recovery patterns. The expected
loss rates are based on the historical payment profiles, historical credit loss rates by industry and data
published by external credit rating institution, 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 Purchasing Manager Index (
ᅰ), Gross Domestic Product ( ਷
࠽and Broad Measure of Money Supply ( ᄿ່஬࿆ԶᏐඎ) of mainland China in which it
provides services to be the most relevant factors, and accordingly adjusts the loss rates based on
expected changes in certain combination of factors for each group with similar credit risk
characteristics.
Details of loss allowance of trade receivables and contract assets as at December 31, 2022,
2023 and 2024 were included in note 6 and note 23, respectively.
The movements on the provision for impairment of trade receivables and contract assets are as
follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
At beginning of the year ..................................... ( 66,516) (138,567) (213,360)
Provision for impairment of trade receivables and contract assets ..... ( 72,051) (91,391) (48,383)
Write-offs of provision for impairment of trade receivables and
contract assets ........................................... — 16,598 19,715
At end of the year .......................................... ( 138,567) (213,360) (242,028)
Other receivables and financial lease receivables
Other receivables mainly include deposits. Financial lease receivables are generated from
subleasing as mentioned in note 2.1.8 (iii). For other receivables and financial lease receivables
management makes periodic collective assessments as well as individual assessment on the
I-35


--- page 420 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.1 Financial risk factors (continued)
(b) Credit risk (continued)
(ii) Impairment of financial assets and contract assets (continued)
Other receivables and financial lease receivables (continued)
recoverability based on historical settlement records, past experience and forward-looking information
on macroeconomic factors affecting the ability of the customers to settle the receivables.
The Group measures credit risk of other receivables and financial lease receivables using
Probability of Default (“PD”), Exposure at Default (“EAD”) and Loss Given Default (“LGD”).
Š Financial instruments that are not credit-impaired on initial recognition are classified in
‘Stage 1’ and have their credit risk continuously monitored by the Group. The expected
credit loss is measured on a 12-month basis.
Š If a significant increase in credit risk (specifically, when the debtor is more than 30 days
past due on its contractual payments) since initial recognition is identified, the financial
instrument is moved to ‘Stage 2’ but is not yet deemed to be credit impaired. The expected
credit loss is measured on lifetime basis.
Š If the financial instrument is credit-impaired (specifically, when the debtor is more than
90 days past due on its contractual payments), the financial instrument is then moved to
‘Stage 3’. The expected credit loss is measured on lifetime basis.
As there has been no significant increase in credit risk since initial recognition, most of the
Group’s other receivables and financial lease receivables as at December 31, 2022, 2023 and 2024
were classified in Stage 1 and their expected credit losses were measured on a 12-month basis.
As at December 31, 2022, 2023 and 2024, the loss allowance of impaired other receivables and
financial lease receivables is determined as follows:
As at December 31,
2022 2023 2024
Expected credit loss rate ............................................. 2.1% 2.0% 1.7%
Gross carrying amount (RMB’000)
—Other receivables ............................................. 6,035 7,589 6,242
—Financial lease receivables ..................................... 4,025 790 6,736
Loss allowance (RMB’000)
—Other receivables ............................................. (152) (129) (122)
—Financial lease receivables ..................................... (62) (40) (102)
I-36


--- page 421 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.1 Financial risk factors (continued)
(b) Credit risk (continued)
(ii) Impairment of financial assets and contract assets (continued)
Other receivables and financial lease receivables (continued)
The movements on the provision for impairment of other receivables and financial lease
receivables are as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
At beginning of the year ....................................... (289) (214) (169)
Provision for impairment of other receivables and financial lease
receivables ............................................... (52) (35) (142)
Reversal of previous impairment losses .......................... 1 2 7 8 0 8 7
At end of the year ............................................ (214) (169) (224)
Write-off policy
Financial assets and contract assets are written off when there is no reasonable expectation of
recovery. Indicators that there is no reasonable expectation of recovery include ceasing enforcement
activity. Where receivables have been written off, the Group continues to engage in enforcement
activity to attempt to recover the receivable due. Where recoveries are made, these are recognized in
profit or loss.
(iii) Net impairment losses on financial assets and contract assets recognized in profit or loss
During the years presented, the following net impairment losses were recognized in profit or
loss in relation to impaired financial assets:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Impairment (losses)/gains on
—trade receivables and contract assets (note 23, 6) ............. (72,051) (91,391) (48,383)
—other receivables and financial lease receivables (note 21, 22) . . . 75 45 (55)
(71,976) (91,346) (48,438)
(c) Liquidity risk
The Group aims to maintain sufficient cash and cash equivalents. Due to the dynamic nature of
the underlying businesses, the policy of the Group is to regularly monitor the Group’s liquidity risk and
to maintain adequate cash and cash equivalents or adjust financing arrangements to meet the Group’s
liquidity requirements.
I-37


--- page 422 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.1 Financial risk factors (continued)
(c) Liquidity risk (continued)
The table below analyzes the Group’s financial liabilities into relevant maturity groupings
based on the remaining period at the end of each reporting period to the contractual maturity date. 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 not significant.
Less than
1 year
Between
1 and
2 years
Between
2 and
5 years Total
RMB’000 RMB’000 RMB’000
At December 31, 2022
Trade and other payables (excluding tax payables) ................ 188,902 — — 188,902
Borrowings (including interest) ............................... 36,147 — — 36,147
Lease liabilities ............................................ 15,152 4,445 — 19,597
240,201 4,445 — 244,646
At December 31, 2023
Trade and other payables (excluding tax payables) ................ 176,343 — — 176,343
Borrowings (including interest) ............................... 66,580 — — 66,580
Lease liabilities ............................................ 5,970 1,483 2,747 10,200
248,893 1,483 2,747 253,123
At December 31, 2024
Trade and other payables (excluding tax payables) ................ 219,941 — — 219,941
Borrowings (including interest) ............................... 146,609 — — 146,609
Lease liabilities ............................................ 11,048 5,349 2,893 19,290
377,598 5,349 2,893 385,840
Please note that the Group did not include the liabilities arising from the redemption rights and
the anti-dilution rights that were granted to the Investors in the above table as these rights are subject to
certain conditions and scenarios (please refer to note 30 and note 31 for more details).
3.2 Capital risk management
The Group’s objectives on managing capital are to safeguard the Group’s ability to continue as
a going concern and support the sustainable growth of the Group in order to provide returns for
shareholders and benefits for other stakeholders and to maintain an optimal capital structure to enhance
equity holders’ value in the long term.
I-38


--- page 423 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.2 Capital risk management (continued)
Consistent with others in the industry, the Group monitors capital on the basis of the net debt
equity ratio. This ratio is calculated as “net debt” divided by “total equity/(deficit)”. Net debt is
calculated as total borrowings, other payable - borrowing from sales and leaseback, lease liabilities,
redemption liabilities and financial liabilities at fair value through profit or loss, less cash and cash
equivalents and financial assets at fair value through profit or loss. The net debt equity ratios of
December 31, 2022, 2023 and 2024 were as follows:
As at December 31,
2022 2023 2024
Borrowings ......................................... 35,000 65,000 145,378
Other payable - borrowing from sales and leaseback ......... — 1,000 —
Lease liabilities ...................................... 18,767 9,598 18,248
Redemption liabilities ................................. 2,108,990 3,038,456 3,303,051
Financial liabilities at fair value through profit or loss ........ 6 6 7 2,383 2,370
Less: cash and cash equivalents .......................... (74,118) (379,224) (156,476)
Wealth management products at fair value through profit or
loss .............................................. — (69,010) —
Net debt ............................................ 2,089,306 2,668,203 3,312,571
Total deficit ......................................... (1,911,238) (2,298,757) (2,752,908)
Net debt deficit ratio .................................. (109%) (116%) (120%)
3.3 Fair value estimation
(a) Financial assets and liabilities
(i) Fair value hierarchy
This section explains the judgments and estimates made in determining the fair values of the
financial instruments that are recognized and measured at fair value in the consolidated financial
statements. 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 the accounting
standards. An explanation of each level follows underneath the table.
Recurring fair value measurements Level 1 Level 2 Level 3 Total
As at December 31, 2022 RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
Financial assets at fair value through profit or loss
—Unlisted equity investments ..................... — — 21,680 21,680
Financial liabilities
Financial liabilities at fair value through profit or loss
—Anti-dilution rights granted to the Investors
(note 2.1.5) .................................. — — 667 667
I-39


--- page 424 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.3 Fair value estimation (continued)
(a) Financial assets and liabilities (continued)
(i) Fair value hierarchy (continued)
Recurring fair value measurements Level 1 Level 2 Level 3 Total
As at December 31, 2023 RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
Financial assets at fair value through profit or loss
—Unlisted equity investments ..................... — — 30,588 30,588
—Wealth management products ................... — — 69,010 69,010
— — 99,598 99,598
Financial liabilities
Financial liabilities at fair value through profit or loss
—Anti-dilution rights granted to the Investors
(note 2.1.5) .................................. — — 2,383 2,383
Recurring fair value measurements Level 1 Level 2 Level 3 Total
As at December 31, 2024 RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
Financial assets at fair value through profit or loss
—Unlisted equity investments ..................... — — 24,347 24,347
— — 24,347 24,347
Financial liabilities
Financial liabilities at fair value through profit or loss
—Anti-dilution rights granted to the Investors
(note 2.1.5) .................................. — — 2,370 2,370
Level 1: The fair value of financial instruments traded in active markets (such as publicly
traded derivatives, and equity securities) is based on quoted market prices at the end of the 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.
Level 2: The fair value of financial instruments that are not traded in an active market (for
example, over-the-counter derivatives) is 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.
Level 3: If one or more of the significant inputs is not based on observable market data, the
instrument is included in level 3. This is the case for unlisted equity securities and financial liabilities
at fair value through profit or loss.
(ii) Valuation techniques used to determine fair values
The valuation of the level 3 instruments mainly included financial assets at fair value through
profit or loss in unlisted equity investments (note 25), financial assets at fair value through profit or
loss in wealth management products (note 25) and financial liabilities at fair value through profit or
I-40


--- page 425 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.3 Fair value estimation (continued)
(a) Financial assets and liabilities (continued)
(ii) Valuation techniques used to determine fair values (continued)
loss (note 31). As these instruments are not traded in an active market, their fair values have been
determined by using various applicable valuation techniques, including discounted cash flows and
market approach etc.
The finance department of the Group involves an independent valuer to perform the valuations
of unlisted equity investments and financial liabilities at fair value through profit or loss. This
independent valuer reports directly to the chief financial officer (CFO). Discussions of valuation
processes and results are held between the CFO and the independent valuer on a periodical basis, in
line with the Group’s reporting periods.
(iii) Fair value measurements using significant unobservable inputs (level 3)
There are no transfers of financial assets or liabilities between levels 2 and 3 during the Track
Record Period.
The following table presents the changes in level 3 instruments of financial assets and financial
liabilities measured at fair value through profit or loss for the years ended December 31, 2022, 2023
and 2024.
Financial assets
at FVPL
- wealth
management
products
Financial
assets
at FVPL
- unlisted equity
investments
Financial
liabilities
at FVPL
- Anti-dilution
rights granted
to the
Investors
RMB’000 RMB’000 RMB’000
Opening balance at January 1, 2022 ................. 80,859 23,022 (270)
Additions ........................................ 88,900 — (362)
Disposals ........................................ (170,754) — —
Gains recognized in other (losses)/gains—net (note 8) .... 9 9 5 (1,342) (35)
Closing balance at December 31, 2022 ............... — 21,680 (667)
Additions ........................................ 803,010 — (985)
Disposals ........................................ (737,110) — —
Gains recognized in other (losses)/gains—net (note 8) .... 3,110 8,908 (731)
Closing balance at December 31, 2023 ............... 69,010 30,588 (2,383)
Additions ........................................ 80,000 2,250 —
Disposals ........................................ (150,006) — —
Gains recognized in other (losses)/gains—net (note 8) .... 9 9 6 (8,491) 13
Closing balance at December 31, 2024 ............... — 24,347 (2,370)
I-41


--- page 426 ---
APPENDIX I ACCOUNTANT’S REPORTII. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.3 Fair value estimation (continued)
(a) Financial assets and liabilities (continued)
(iii) Fair value measurements using significant unobservable inputs (level 3) (continued)
Description
Fair value Significant
unobservable
inputs
Range of inputs Relationship of unobservable
inputs to fair valueAs at December 31, As at December 31,
2022 2023 2024 2022 2023 2024
RMB’000 RMB’000 RMB’000
Financial assets at FVPL—wealth
management products ........ — 69,010 — Expected rate of return n/a 2.6% n/a
The higher the
expected rate of
return, the higher the
fair value
Financial assets at FVPL—
unlisted equity investments ....
Discount for lack of marketability
(“DLOM”) 20.0%-27.7% 20.0% 20.0%
The higher the
DLOM, the lower the
fair value
21,680 30,588 24,347 Enterprise value/Sales 0.6-4.6 0.6-4.7 5.5
The higher the
Enterprise value/
Sales, the higher the
fair value
Financial liabilities at FVPL—
anti-dilution right granted to the
Investors ..................
Discount rate 15.0% 15.0% 15.0%
The higher the
discount rate, the
lower the fair value
Volatility 51. 1% 45.5% 53.1%
The higher the
volatility, the higher
the fair value
Risk-free interest rate 2.1% 2.1% 1.0%
The higher the risk-
free interest rate, the
lower the fair value
667 2,383 2,370 DLOM 10.0% 10.0% 10.0%
The higher the
DLOM, the lower the
fair value
I-42


--- page 427 ---
APPENDIX I ACCOUNTANT’S REPORTII. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
3 Financial risk management (continued)
3.3 Fair value estimation (continued)
(a) Financial assets and liabilities (continued)
(iii) Fair value measurements using significant unobservable inputs (level 3) (continued)
The Group entered into contracts in respect of wealth management products with expected but not guaranteed rates of return ranging as
shown above. The Group managed and evaluated the performance of these investments on a fair value basis, in accordance with the Group’s risk
management and investment strategy and hence they are designated as financial assets at FVPL. If the expected rate of return of investments held by
the Group be 1% higher/lower as at December 31, 2022, 2023 and 2024, loss before income tax for the years ended December 31, 2022, 2023 and
2024 would be approximately nil, RMB144.2 thousand lower/higher, nil, respectively.
If the DLOM the unlisted equity investments measured at FVPL held by the Group be 10% higher/lower, the loss before income tax for the
years ended December 31, 2022, 2023, and 2024 and would be RMB708.4 thousand/ RMB554.0 thousand lower/higher, RMB864.0 thousand / RMB
863.0 thousand lower/higher, RMB634.0 thousand/ RMB633.0 thousand lower/higher, respectively.
Fair value of financial liabilities at FVPL is affected by changes in the fair value of the underlying equity of the Company. If the Company’s
equity value was higher/lower by 10% with all other variables held constant, the loss before income tax for the years ended December 31, 2022, 2023
and 2024 would be RMB197.1 thousand/ RMB167.2 thousand lower/higher , RMB753.1 thousand/ RMB758.3 thousand lower/higher and RMB838.8
thousand/ RMB901.8 thousand lower/higher, respectively.
I-43


--- page 428 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
4 Critical accounting estimates and judgments
Estimates and judgments are continually evaluated and are based on historical experience and
other factors, including expectations of future events that are believed to be reasonable under the
circumstances.
The Group makes estimates and assumptions concerning the future. The resulting accounting
estimates will, by definition, seldom equal the related actual results. 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 financial year are addressed below.
(a) Revenue recognition—allocating the transaction price
If a contract has several distinct performance obligations, the transaction price is allocated to
each of distinct performance obligation in the contract based on their relative stand-alone selling
prices. If the stand-alone selling price is not directly observable, management estimate the stand-alone
selling price using cost plus a reasonable margin approach or residual approach when appropriate,
depending on the availability of observable information for such performance obligations.
Significant assumptions and estimates have been made in identifying the number of
performance obligations included in the contracts and estimating the standalone selling price of each
distinct performance obligation, and changes in judgments on these assumptions and estimates could
materially impact the timing of revenue recognition.
(b) Current and deferred income tax
The Group is subject to corporate income taxes in mainland China and Hong Kong. Judgment
is required in determining the amount of the provision for taxation and the timing of payment of the
related taxations. There are many transactions and calculations for which the ultimate tax
determination is uncertain during the ordinary course of business.
Deferred tax assets relating to certain temporary differences and tax losses are recognized when
management considers it to be probable that future taxable profits will be available against which the
temporary differences or tax losses can be utilized.
Where the final tax outcome of these matters is different from the amounts that were initially
recorded, such differences will impact the income tax and deferred tax provisions in the period in
which such determination is made.
(c) Impairment of financial assets
The loss allowance for financial assets disclosed in note 3.1 is based on assumptions about risk
of default and expected loss rate. The Group uses judgment in making these assumptions and selecting
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.
I-44


--- page 429 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
4 Critical accounting estimates and judgments (continued)
(d) Fair value of unlisted equity investments classified as financial assets at FVPL
The fair value of unlisted equity investments that are not traded in an active market is
determined by using valuation techniques. The Company uses its judgment to select appropriate
method and makes 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.
5 Segment information
During the Track Record Period, the Group’s business activities are primarily providing sales
of AI products, solutions and charging service fees for using its AI platform and solutions. The
Group’s CODM, who has been identified as the chief executive officer, reviews consolidated results
when making decisions about allocating resources and assessing performance of the Group as a whole
and hence, the Group has only one reportable segment.
No geographical segment information is presented as the revenue and operating losses of the
Group are mainly derived within the PRC and all the operating assets of the Group are located in the
PRC, which is considered as one geographic location with similar risks and returns.
6 Revenue
Disaggregation of revenue from contracts with customers by revenue streams is as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Daily life .................................................. 486,682 578,729 739,830
Healthcare ................................................. 113,452 148,245 199,180
Others ..................................................... 4 8 5 3 4 2 7
600,619 727,316 939,017
Disaggregation of revenue from contracts with customers by the timing of revenue recognition
is as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Revenue
—recognized at a point in time ................................. 583,048 698,529 910,961
—recognized over time ....................................... 17,571 28,787 28,056
600,619 727,316 939,017
I-45


--- page 430 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
6 Revenue (continued)
There is no single customer who contributed more than 10% of the total revenue of the Group
for the years ended December 31, 2022, 2023, and 2024.
Contract assets and contract liabilities
The Group has recognized the following revenue-related contract assets and liabilities:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Contract assets (i)
Daily life .............................................. 1,834 3,593 3,265
Healthcare ............................................. 3,091 1,764 2,482
Less: allowance for impairment of contract assets .............. (1,017) (1,234) (778)
Total .................................................. 3,908 4,123 4,969
Contract liabilities (ii)
Daily life .............................................. 42,294 53,920 80,884
Healthcare ............................................. 12,909 10,884 5,381
Others ................................................. 6 7 4 — —
Total .................................................. 55,877 64,804 86,265
The Company has recognized the following revenue-related contract assets and liabilities:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Contract assets (i)
Daily life .............................................. 2 2 0 9 7 1 2 3
Healthcare ............................................. 3,091 1,764 1,169
Less: allowance for impairment of contract assets .............. (715) (817) (162)
Total .................................................. 2,596 1,918 1,030
Contract liabilities (ii)
Daily life .............................................. 5,496 17,758 19,911
Healthcare ............................................. 1,562 2,930 3,647
Total .................................................. 7,058 20,688 23,558
(i) Contract assets are the Group’s right to consideration in exchange for goods or services that the
Group transferred to the customer where that right is conditional on something other than the
passage of time. As at end of each year of the Track Record Period, the contract assets were
mainly the unsettled part of contract fees relating to quality guarantee.
The Group applies the IFRS 9 simplified approach to measure expected credit losses which
uses a lifetime expected loss allowance for all contract assets.
(ii) Contract liabilities mainly arise from the advance payments from customers upon which the
performance obligations have been established while the underlying services are yet to be
provided.
I-46


--- page 431 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
6 Revenue (continued)
Revenue recognized in relation to contract liabilities
The following table shows how much of the revenue, which was included in the contract
liability balance at the beginning of each period, recognized during each of the Track Record Period
related to carried-forward contract liabilities.
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Daily life .................................................. 12,267 17,991 21,243
Healthcare ................................................. 2,018 5,504 6,264
Others ..................................................... 2 5 1 6 5 —
Total ...................................................... 14,310 23,660 27,507
Unsatisfied performance obligations
The following table shows unsatisfied performance obligations as at December 31, 2022, 2023
and 2024:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Daily life .................................................. 110,568 198,963 310,701
Healthcare ................................................. 16,399 30,463 50,992
Total ...................................................... 126,967 229,426 361,693
Management expects that 50.5%, 68.8% and 79.3% of the transaction price allocated to the
unsatisfied contracts as at December 31, 2022, 2023 and 2024 will be recognized as revenue within
one year. The remaining 49.5%, 31.2% and 20.7% will be recognized over one year.
7 Other income
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Government grants (i) ........................................ 13,241 32,749 16,084
VAT refund and VAT super-deduction ........................... 2,328 3,382 809
Others ..................................................... 1 7 7 1 8 2 1 8 4
15,746 36,313 17,077
(i) The Group received government grants from local governments as support for research and
development expenses relating to innovation activities.
I-47


--- page 432 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
8 Other (losses)/gains—net
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Net fair value (losses)/gains on financial assets at FVPL (note 25) ..... (347) 12,018 (7,495)
Net fair value (losses)/gains on financial liabilities at FVPL (note 3.3) . . (35) (731) 13
Financial subleasing related income ............................. 3 3 4 1 7 1 2 2 2
Potential loss on investments accounted for using the equity method . . . — — (4,900)
Other items ................................................. (1,315) (879) (1,804)
(1,363) 10,579 (13,964)
9 Expenses by nature
Expenses included in cost of sales and services, selling and marketing expenses, administrative
expenses and research and development expenses are further analyzed as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Employee benefit expenses (note 10) ........................... 173,203 179,527 186,942
Cost of hardware ........................................... 279,629 302,899 312,938
Software development support fees ............................ 61,272 108,891 237,147
Technology service fees ..................................... 147,266 143,906 210,146
Marketing and promotional expenses ........................... 12,950 18,534 25,393
Server operation and cloud-based service fees .................... 10,922 17,139 32,681
Depreciation of property, plant and equipment (note 16) ............ 12,417 9,468 12,766
Depreciation of right-of-use assets (note 17) ..................... 9,450 10,131 10,086
Amortization of intangible assets (note 18) ...................... 3 7 3 2 7 7 2,997
Auditors’ remuneration
— Audit services ....................................... 7 7 3 5 6 8 4 2 3
Listing expenses ........................................... 15,757 26,276 21,234
Other professional fees ...................................... 4,067 6,111 4,523
Taxes and surcharges ........................................ 2,560 2,731 3,682
Other expenses ............................................ 11,698 16,481 18,462
742,337 842,939 1,079,420
10 Employee benefit expenses
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Wages, salaries and bonuses ................................... 134,071 134,261 148,674
Pension costs ............................................... 17,858 17,914 17,951
Housing funds .............................................. 9,749 9,819 9,955
Other social security costs ..................................... 10,689 10,712 10,155
Other employee welfare ....................................... 1,587 3,386 2,900
Share based compensation (note 32(i)) ........................... — 4,532 —
173,954 180,624 189,635
Less: capitalized in contract fulfillment cost ....................... (751) (1,097) (2,693)
173,203 179,527 186,942
I-48


--- page 433 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
10 Employee benefit expenses (continued)
(i) Five highest paid individuals
The five individuals whose emoluments were the highest in the Group for the Track Record
Period included 2, 1 and 3 directors respectively, whose emoluments are disclosed in note 41. The
emoluments payable to the remaining 3, 4 and 2 individuals during the Track Record Period
respectively are as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Wages, salaries and bonuses ................................... 3,057 3,856 1,513
Pension costs ............................................... 2 0 1 2 4 5 1 4 1
Housing benefits ............................................ 9 7 1 3 4 8 1
Other social security costs ..................................... 1 2 1 1 4 3 8 3
3,476 4,378 1,818
The emoluments of the 3, 4 and 2 individuals fell within the following bands:
Year ended December 31,
2022 2023 2024
Emoluments bands:
HK$ 500,000 to HK$1,000,000 ....................................... — — 1
HK$1,000,001 to HK$1,500,000 ...................................... 3 4 1
34 2
During the Track Record Period, no director or the five highest paid individuals received any
emolument from the Group as an inducement to join, upon joining the Group, leave the Group or as
compensation for loss of office.
11 Finance costs—net
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Finance income
Interest income from bank deposits ............................ 3 1 4 1,875 2,298
Finance costs
Interest expenses on redemption liabilities (note 30) ............... ( 176,429) (208,845) (264,595)
Interest expenses on bank borrowings .......................... ( 340) (2,808) (5,323)
Interest expenses on lease liabilities (note 17) .................... (906) (731) (1,020)
Interest expenses on borrowing from sales and leaseback ........... — (386) (5)
Finance costs—net ......................................... (177,361) (210,895) (268,645)
I-49


--- page 434 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
12 Subsidiaries
(a) Subsidiaries of the Group
The Group’s principal subsidiaries at December 31, 2022, 2023 and 2024 are set out below. Unless
otherwise stated, the proportion of ownership interests held equals to the voting rights held by the Group.
The country of incorporation or registration is also their principal place of business.
Name
Place of operation and
date of incorporation/
establishment
Principal
activities
Paid in capital
as at
December 31,
2024
Ownership interest held
By the Group as at
December 31, Date of
report2022 2023 2024
Directly held by the Company
Shenzhen Unisound Information
Technology Co., Ltd. ( ധᎪᄉᆩലྐ
ඌʮ̡) (“Shenzhen
Unisound”) ...................
Shenzhen, China
December 28, 2015
Daily life,
Healthcare
RMB
10,000,000 100% 100% 100% 100%
HK UNISOUND INFORMATION
TECHNOLOGY CO., LIMITED
(
ඳ) ....
Hong Kong, China
January 13, 2016 Daily life
HKD
10,000 100% 100% 100% 100%
Yunzhixin Smart City Development
(Xiamen) Co., Ltd. (̹
࢝(䄻䔊)ʮ̡) ............
Xiamen, China
January 28, 2021 Daily life Nil 100% Nil Nil Nil
Beijing Zhuyun Shanhai Intelligent
Technology Co., Ltd. ( ̏ԯ஼ʛʆऎ
ʮ̡) ..............
Beijing, China
November 15, 2023 Daily life Nil Nil 100% 100% 100%
Shanghai Xiongzun Intelligent
Engineering Co., Ltd. ( ɪऎඪయ౽
ʮ̡)................
Shanghai, China
April 27, 2021 Daily life
RMB
200,000 100% 100% 100% 100%
Chengdu Unisound AI Technology
Co., Ltd. (ࠢ
ʮ̡).........................
Chengdu, China
May 20, 2021 Daily life
RMB
10,000,000 100% 100% 100% 100%
Unisound (Tianjin) Information
Technology Co., Ltd. ( ᄉᆩല (˂
ݵ)ඳ) ...........
Tianjin, China
August 3, 2022 Daily life
RMB
8,000,000
100%
100% 100% 100%
Xiamen Unisound AI Technology Co.,
Ltd.
(
ʮ̡) ....
Xiamen, China
October 18, 2017 Daily life
RMB
100,000,000 100% 100% 100% 100%
Unisound (Shanghai) Intelligent
Technology Co., Ltd. (䕉(ɪ
ऎ)ʮ̡) (“Shanghai
Unisound”) ...................
Shanghai, China
August 7, 2017 Daily life
RMB
100,000,000 100% 100% 100% 100%
Jinan Yunzhisheng Technology Co.,
Ltd. (ʮ̡) ....
Jinan, China
April 19, 2023 Daily life
RMB
50,000,000 Nil 100% 100% 100%
Yunzhisheng (Xinyang) Digital
Technology Co., Ltd (ڦ
ʮ̡)............
Xinyang, China
May 22, 2023 Daily life
RMB
100,000,000 Nil 100% 100% 100%
Unisound (Hangzhou) AI Technology
Co., Ltd. (ࠢ
ʮ̡).........................
Hangzhou, China
June 6, 2023 Daily life
RMB
100,000,000 Nil 100% 100% 100%
Sichuan Yunzhisheng Intelligent
Technology Co., Ltd. (䕉౽
ʮ̡)................
Sichuan, China
June 21, 2023 Daily life
RMB
100,000,000 Nil 100% 100% 100%
I-50


--- page 435 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
12 Subsidiaries (continued)
(a) Subsidiaries of the Group (continued)
Name
Place of operation and
date of incorporation/
establishment
Principal
activities
Paid in capital
as at
December 31,
2024
Ownership interest held
By the Group as at
December 31, Date of
report2022 2023 2024
Directly held by the Company (continued)
Guangxi Guiyuntong Technology Co.,
Ltd.(ʮ̡) ....
Nanning, China
March 27, 2023 Daily life
RMB
10,000,000 Nil 65% 65% 65%
Henan Yunzhisheng Technology Co.,
Ltd.(ʮ̡) ....
Nanning, China
January 17, 2024 Daily life
RMB
1,000,000 Nil Nil 100% 100%
Jiangsu Yunzhisheng Technology Co.,
Ltd.(ʮ̡) ....
Nanjin, China
September 29, 2024 Daily life
RMB
10,000,000 Nil Nil 100% 100%
Indirectly held by the Company
Xiamen Deep Learning AI
Engineering Research Institute Co.,
Ltd. (
Ӻ
ʮ̡) ...................
Xiamen, China
December 28, 2017 Daily life
RMB
2,000,000 100% 100% 100% 100%
Yunmao Internet Intelligent
Technology (Xiamen) Co., Ltd.
(
ʮ̡ ..
Xiamen, China
April 17, 2019 Daily life
RMB
10,000,000 51% 51% 51% 51%
Fujian Unisound AI Technology Co.,
Ltd. (ʮ̡)
(Fujian Unisound) ..............
Fujian, China
January 7, 2021 Daily life
RMB
2,000,000 51% 75% 75% 75%
Jiangsu Yunzhisheng Shanhai
Technology Co., Ltd.(䕉ʆ
ʮ̡)................
Nanjin, China
November 05, 2024
Daily life Nil Nil Nil 60% 60%
The Company records in its balance sheets the “Investments in subsidiaries” including i) the paid-in
capital to its directly held subsidiaries as listed above at RMB228 million, RMB585 million and 596 million
on December 31, 2022, 2023 and 2024, respectively, and ii) share-based compensation expenses for
historical share incentives granted to certain employees of the directly held subsidiaries using the
Company’s equity instruments, amounted to RMB2.2 million, RMB2.2 million, and RMB2.2 million on
December 31, 2022, 2023 and 2024, respectively.
(b) Investment in subsidiaries — the Company
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
At beginning of the year ....................................... 122,383 230,383 586,883
Additional investments in subsidiaries ........................... 108,000 356,500 11,000
Impairment of investments in a subsidiary ........................ — — (5,100)
At end of the year ............................................ 230,383 586,883 592,783
I-51


--- page 436 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
13 Investments accounted for using the equity method
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
At beginning of the year ....................................... 1,525 2,617 —
Share of profit/(loss) ......................................... 1,092 (2,617) —
At end of the year ............................................ 2,617 — —
Set out below is the associate, accounted for using the equity method, of the Group as at
December 31, 2022, 2023 and 2024. The proportion of ownership interest is the same as the proportion
of voting rights held.
% of ownership interest Carrying amount
Name of entity
Place of
operation As at December 31, As at December 31,
2022 2023 2024 2022 2023 2024
% % % RMB’000 RMB’000 RMB’000
Shanghai Maosheng Intelligence Technology
Co., Ltd. (“Maosheng”) .................
Shanghai,
China 49.0 49.0 49.0 2,617 — —
14 Income tax expense
(a) Hong Kong Income Tax
Subsidiary incorporated in Hong Kong is subject to Hong Kong profits tax of which the tax rate
is 8.25% on assessable profits up to HKD2 million, and 16.5% on any part of assessable profits over
HKD2 million for the Track Record Period.
(b) PRC Corporate Income Tax (“CIT”)
The income tax provision of the Group in respect of its operations in the PRC was subject to a
statutory tax rate of 25% on the assessable profits for the Track Record Period, based on the existing
legislation, interpretations and practices in respect thereof.
The Company, Shenzhen Unisound and Shanghai Unisound qualified as “High and New
Technology Enterprises” (“HNTEs”) under the relevant PRC laws and regulations. Accordingly, these
entities were entitled to a preferential income tax rate of 15% during the Track Record Period. This
status is subject to a requirement that they reapply for HNTEs status every three years.
The income tax (credit)/expense of the Group for the years ended December 31, 2022, 2023
and 2024 is as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Current tax ................................................. 3 3 2,309 80
Deferred income tax (credit)/expense (note 34) .................... (222) 346 (242)
Income tax (credit)/expense .................................... (189) 2,655 (162)
I-52


--- page 437 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
14 Income tax expense (continued)
(b) PRC Corporate Income Tax (“CIT”) (continued)
The tax on the Group’s loss before tax differs from the theoretical amount that would arise
using the weighted average tax rate applicable to losses of the consolidated entities as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Loss before income tax credit ................................... ( 375,580) (373,589) (454,373)
Tax calculated at statutory tax rate of 25% ......................... ( 93,895) (93,397) (113,593)
Tax effects of:
Expenses not deductible for tax purposes (i) .................... 36,504 31,996 40,310
Super-deduction for research and development expenses (ii) ....... (18,994) (22,603) (31,663)
Tax losses and temporary differences for which no deferred income
tax asset was recognized (iii) .............................. 39,486 48,115 57,360
Effect of preferential tax rates ................................... 36,735 38,544 47,454
Effect of different tax rates ..................................... (25) — (30)
(189) 2,655 (162)
(i) Expenses not deductible for tax purposes mainly consist of interest expense on redemption
liabilities (note 11) and certain non-deductible expenses.
(ii) According to the relevant laws and regulations promulgated by the State Taxation
Administration of the PRC, enterprises engaging in research and development activities are
entitled to claim 200% of their research and development expenses so incurred as tax
deductible expenses when determining their assessable profits for that year (“Super-
deduction”). The Group has made its best estimation for the Super-deduction to be claimed for
the Group’s entities in ascertaining their assessable profits for the years ended December 31,
2022, 2023 and 2024.
(iii) As at December 31, 2022, 2023, and 2024, the Group had unused tax losses of approximately
RMB1,508 million, RMB1,718 million and RMB1,946 million respectively that can be carried
forward against future taxable income. The unused tax losses of the Group were from the
subsidiaries incorporated in the PRC, where the accumulated tax losses will normally expire
within 5 years. Pursuant to the relevant regulations on extension for expiries of unused tax
losses of HNTEs issued in August 2018, the accumulated tax losses which have not expired by
2018 have been extended from 5 years to 10 years from then on.
As at December 31, 2022, 2023 and 2024, the expiry dates of the unused tax losses are listed as
below.
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Year ended December 31, 2023 ................................. 3 1 8 — —
Year ended December 31, 2024 ................................. 42,833 42,785 —
Year ending December 31, 2025 ................................ 91,952 76,939 75,825
Year ending December 31, 2026 ................................ 118,708 118,708 117,951
Year ending December 31, 2027 ................................ 153,406 149,851 149,851
Year ending December 31, 2028 ................................ 171,611 167,531 166,561
I-53


--- page 438 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
14 Income tax expense (continued)
(b) PRC Corporate Income Tax (“CIT”) (continued)
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Year ending December 31, 2029 ............................ 252,370 252,370 293,972
Year ending December 31, 2030 ............................ 202,499 202,499 202,499
Year ending December 31, 2031 ............................ 226,944 226,944 226,944
Year ending December 31, 2032 ............................ 247,287 247,279 247,279
Year ending December 31, 2033 ............................ — 233,374 233,374
Year ending December 31, 2034 ............................ — — 232,240
1,507,928 1,718,280 1,946,496
15 Loss per share
Basic loss per share for the years ended December 31, 2022, 2023 and 2024 are calculated by
dividing the loss attributable to the Company’s owners by the weighted average number of ordinary
shares in issue during the Track Record Period.
The calculation of loss per share is based on the following:
Year ended December 31,
2022 2023 2024
Loss for the year attributable to owners of the Company
(RMB’000) ............................................. (366,012) (375,461) (452,364)
Weighted average number of ordinary shares in issue (thousand
shares) ................................................. 63,613 67,357 69,392
Basic and diluted loss per share
(RMB yuan) (a) .......................................... (5.75) (5.57) (6.52)
(a) 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. As the Group
incurred losses for the years ended December 31, 2022, 2023 and 2024, the potential ordinary
shares were not included in the calculation of diluted loss per share, as their inclusion would be
anti— dilutive. Accordingly, diluted loss per share for the years ended December 31, 2022,
2023 and 2024 are the same as basic loss per share for the respective years.
I-54


--- page 439 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
16 Property, plant and equipment
The Group
Electronic
equipment
Office
furniture
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000 RMB’000
Cost:
At January 1, 2022 .............................. 55,100 5,140 15,997 76,237
Additions ...................................... 1,103 287 99 1,489
Disposals ...................................... (519) (48) — (567)
At December 31, 2022 ........................... 55,684 5,379 16,096 77,159
Additions ...................................... 14,078 111 41 14,230
Disposals ...................................... (1,880) (65) — (1,945)
At December 31, 2023 ........................... 67,882 5,425 16,137 89,444
Additions ...................................... 8,478 2,707 10,529 21,714
Disposals ...................................... (736) (154) (16,035) (16,925)
At December 31, 2024 ........................... 75,624 7,978 10,631 94,233
Accumulated depreciation:
At January 1, 2022 .............................. (35,967) (3,936) (10,840) (50,743)
Depreciation ................................... (8,725) (631) (3,061) (12,417)
Disposals ...................................... 4 9 2 4 2 — 5 3 4
At December 31, 2022 ........................... (44,200) (4,525) (13,901) (62,626)
Depreciation ................................... (6,980) (471) (2,017) (9,468)
Disposals ...................................... 1,751 59 — 1,810
At December 31, 2023 ........................... (49,429) (4,937) (15,918) (70,284)
Depreciation ................................... (9,255) (753) (2,758) (12,766)
Disposals ...................................... 7 1 7 1 4 6 16,035 16,898
At December 31, 2024 ........................... (57,967) (5,544) (2,641) (66,152)
Net carrying amount:
At December 31, 2022 ........................... 11,484 854 2,195 14,533
At December 31, 2023 ........................... 18,453 488 219 19,160
At December 31, 2024 ........................... 17,657 2,434 7,990 28,081
Depreciation expenses have been charged to profit or loss and presented in the consolidated
statements of comprehensive loss as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Cost of sales ................................................ 3,930 3,565 2,536
Selling and marketing expenses ................................. 9 8 8 1,591 4,142
Administrative expenses ...................................... 1,177 956 862
Research and development expenses ............................. 6,322 3,356 5,226
12,417 9,468 12,766
I-55


--- page 440 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
16 Property, plant and equipment (continued)
The Company
Electronic
equipment
Office
furniture
Leasehold
improvement Total
RMB’000 RMB’000 RMB’000 RMB’000
Cost:
At January 1, 2022 ............................... 13,136 3,952 10,968 28,056
Additions ...................................... 8 0 9 1 9 4 — 1,003
Disposals ....................................... (396) (26) — (422)
At December 31, 2022 ............................ 13,549 4,120 10,968 28,637
Additions ...................................... 9,328 — — 9,328
Disposals ....................................... (792) (10) — (802)
At December 31, 2023 ............................ 22,085 4,110 10,968 37,163
Additions ...................................... 4,337 783 — 5,120
Disposals ....................................... (21) (25) (10,968) (11,014)
At December 31, 2024 ............................ 26,401 4,868 — 31,269
Accumulated depreciation:
At January 1, 2022 ............................... (11,124) (2,817) (7,511) (21,452)
Depreciation .................................... (679) (447) (1,661) (2,787)
Disposals ....................................... 3 7 6 2 5 — 4 0 1
At December 31, 2022 ............................ (11,427) (3,239) (9,172) (23,838)
Depreciation .................................... (2,224) (351) (1,660) (4,235)
Disposals ....................................... 7 5 2 1 0 — 7 6 2
At December 31, 2023 ............................ (12,899) (3,580) (10,832) (27,311)
Depreciation .................................... (4,240) (457) (136) (4,833)
Disposals ....................................... 1 9 1 8 10,968 11,005
At December 31, 2024 ............................ (17,120) (4,019) — (21,139)
Net carrying amount:
At December 31, 2022 ............................ 2,122 881 1,796 4,799
At December 31, 2023 ............................ 9,186 530 136 9,852
At December 31, 2024 ............................ 9,281 849 — 10,130
Depreciation expenses have been charged to profit or loss and presented in the Company
statements of comprehensive loss as follows 
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Cost of sales ................................................ 2 3 5 7 3
Selling and marketing expenses ................................. 2 5 3 4 1 6 6
Administrative expenses ...................................... 4 4 4 8 2 0 2 3 8
Research and development expenses ............................. 2,316 3,039 4,456
2,787 4,235 4,833
I-56


--- page 441 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
17 Leases
The Group
(a) Amounts recognized in the consolidated balance sheets
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Right-of-use assets
Buildings .................................................. 12,422 8,645 10,385
Lease liabilities
Current .................................................... 14,395 4,913 10,665
Non-current ................................................ 4,372 4,685 7,583
18,767 9,598 18,248
(b) The movement in right-of-use assets in the consolidated balance sheets are as follows:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Cost
At beginning of the year ....................................... 39,662 48,501 33,416
Additions .................................................. 8,839 7,586 20,586
Modification of leasing contracts ................................ — (3,407) —
Termination of lease contracts .................................. — (19,264) (34,701)
At end of the year ............................................ 48,501 33,416 19,301
Accumulated depreciation
At beginning of the year ....................................... (26,629) (36,079) (24,771)
Depreciation charge for the year ................................ (9,450) (10,131) (10,086)
Modification of leasing contracts ................................ — 2,175 —
Termination of lease contracts .................................. — 19,264 25,941
At end of the year ............................................ (36,079) (24,771) (8,916)
Net book amount
At end of the year ............................................ 12,422 8,645 10,385
(c) Amounts recognized in the consolidated statements of comprehensive income
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Depreciation charge of right-of-use assets
—Building ............................................. 9,450 10,131 10,086
Interest expense (note 11) ..................................... 9 0 6 7 3 1 1,020
Expense relating to short-term leases ............................ 1,132 685 2,145
The total cash outflows for long-term and short-term leases during the years ended
December 31, 2022, 2023 and 2024 were approximately RMB12.0 million, RMB16.5 million and
RMB15.1 million, respectively.
I-57


--- page 442 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
17 Leases (continued)
The Company
(a) Amounts recognized in the balance sheets of the Company
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Right-of-use assets
Buildings .................................................. 4,423 341 4,868
Lease liabilities
Current .................................................... 5,163 — 4,380
(b) The movement in right-of-use assets in the balance sheets of the Company are as follows:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Cost
At beginning of the year ....................................... 20,412 20,412 20,412
Additions .................................................. — — 8,986
Termination of lease contracts .................................. — — (20,412)
At end of the year ............................................ 20,412 20,412 8,986
Accumulated depreciation
At beginning of the year ....................................... (11,907) (15,989) (20,071)
Depreciation charge for the year ................................ (4,082) (4,082) (4,459)
Termination of leasing contracts ................................ — — 20,412
At end of the year ............................................ (15,989) (20,071) (4,118)
Net book amount
At end of the year ............................................ 4,423 341 4,868
(c) Amounts recognized in the statements of comprehensive income
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Depreciation charge of right-of-use assets
—Building ............................................. 4,082 4,082 4,459
Interest expense (note 11) ..................................... 3 8 3 1 0 1 2 8 2
Expense relating to short-term leases ............................ 2 0 9 2 1 9 2 3 3
The total cash outflows for long-term and short-term leases during the years ended
December 31, 2022, 2023 and 2024 were approximately RMB5.1 million, RMB6.0 million and
RMB5.1 million, respectively.
I-58


--- page 443 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
18 Intangible Assets
The Group
Software Patent Total
RMB’000 RMB’000 RMB’000
Cost:
At January 1, 2022 ........................................... 2,291 300 2,591
Additions .................................................. 3 2 1 — 3 2 1
Disposals .................................................. — — —
At December 31, 2022 ........................................ 2,612 300 2,912
Additions .................................................. 2 1 5 — 2 1 5
Disposals .................................................. — — —
At December 31, 2023 ........................................ 2,827 300 3,127
Additions .................................................. 10,690 600 11,290
Disposals .................................................. — (300) (300)
At December 31, 2024 ........................................ 13,517 600 14,117
Accumulated amortization:
At January 1, 2022 ........................................... (1,929) (50) (1,979)
Amortization ............................................... (223) (150) (373)
Disposals .................................................. — — —
At December 31, 2022 ........................................ (2,152) (200) (2,352)
Amortization ............................................... (177) (100) (277)
Disposals .................................................. — — —
At December 31, 2023 ........................................ (2,329) (300) (2,629)
Amortization ............................................... (2,697) (300) (2,997)
Disposals .................................................. — 3 0 0 3 0 0
At December 31, 2024 ........................................ (5,026) (300) (5,326)
Net carrying amount:
At December 31, 2022 ........................................ 4 6 0 1 0 0 5 6 0
At December 31, 2023 ........................................ 4 9 8 — 4 9 8
At December 31, 2024 ........................................ 8,491 300 8,791
Amortization expenses have been charged to profit or loss and presented in the consolidated
statements of comprehensive loss as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Selling and marketing expenses ................................. 2 1 2 1 2,522
Administrative expenses ...................................... 8 7 6 3 1 0 1
Research and development expenses ............................. 2 6 5 1 9 3 3 7 4
373 277 2,997
I-59


--- page 444 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
18 Intangible Assets (continued)
The Company
Software
RMB’000
Cost:
At January 1, 2022 ............................................................ 2,085
Additions .................................................................... 3 2 1
Disposals .................................................................... —
At December 31, 2022 ......................................................... 2,406
Additions .................................................................... 2 1 4
Disposals .................................................................... —
At December 31, 2023 ......................................................... 2,620
Additions .................................................................... —
Disposals .................................................................... —
At December 31, 2024 ......................................................... 2,620
Accumulated amortization:
At January 1, 2022 ............................................................ (1,883)
Amortization ................................................................. (192)
Disposals .................................................................... —
At December 31, 2022 ......................................................... (2,075)
Amortization ................................................................. (145)
Disposals .................................................................... —
At December 31, 2023 ......................................................... (2,220)
Amortization ................................................................. (163)
At December 31, 2024 ......................................................... (2,383)
Net carrying amount:
At December 31, 2022 ......................................................... 3 3 1
At December 31, 2023 ......................................................... 4 0 0
At December 31, 2024 ......................................................... 2 3 7
Amortization expenses have been charged to profit or loss and presented in the consolidated
statements of comprehensive loss as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Administrative expenses ...................................... 8 7 6 3 8 3
Research and development expenses ............................. 1 0 5 8 2 8 0
192 145 163
19 Other non-current assets
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Prepayments for acquiring office space (note 38(a)) ................. — 47,393 47,393
On April 25, 2023, the Group entered into an agreement with Jinan Supercomputing Industry
Development Co., LTD (ʮ̡) to acquire office space in the National
I-60


--- page 445 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
19 Other non-current assets (continued)
Supercomputing Center Jinan Science Park (Ҧ෤). Pursuant to this agreement, on
December 31, 2023, the Company paid a down payment of RMB47.4 million, representing
approximately 50% of the total expected purchase consideration. The Company recorded the above
prepayment as other non-current assets in the consolidated balance sheet. See note 38 for more
information.
20 Financial instruments by category
As at December 31,
Note 2022 2023 2024
Financial assets RMB’000 RMB’000 RMB’000
Financial assets at amortized cost:
—Trade receivables ............................. 2 3 368,860 411,053 559,242
—Other receivables (included in the “prepayments and
other receivables”) ............................ 22 5,883 7,460 6,120
—Cash and cash equivalents ...................... 2 6 74,118 379,224 156,476
—Financial lease receivables ..................... 2 1 3,963 750 6,634
Financial assets at fair value through profit or loss
—Wealth management products ................... 2 5 — 69,010 —
—Unlisted equity investments ..................... 2 5 21,680 30,588 24,347
474,504 898,085 752,819
As at December 31,
Note 2022 2023 2024
Financial liabilities RMB’000 RMB’000 RMB’000
Financial liabilities at amortized cost:
—Trade and other payables (excluding tax payables) . . . 33 188,902 176,343 219,941
—Borrowings ................................. 3 7 35,000 65,000 145,378
—Redemption liabilities ......................... 3 0 2,108,990 3,038,456 3,303,051
—Lease liabilities .............................. 1 7 18,767 9,598 18,248
Financial liabilities at fair value through profit or loss:
—Anti-dilution rights granted to the Investors ........ 3 1 6 6 7 2,383 2,370
2,352,326 3,291,780 3,688,988
The Group’s exposure to various risks associated with the financial instruments is discussed in
note 3. The maximum exposure to credit risk at the end of the reporting period is the carrying amount
of each class of financial assets mentioned above.
I-61


--- page 446 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
21 Financial lease receivables
Details of finance lease receivables as at December 31, 2022, 2023 and 2024 are as below:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Finance lease receivables, gross
—Finance lease receivables, undiscounted .................... 4,367 911 7,179
—Unearned finance lease income ........................... (342) (121) (443)
4,025 790 6,736
Less: provision for expected credit losses ......................... (62) (40) (102)
Finance lease receivables, net
— Current ............................................. 3,293 750 2,909
— Non-current .......................................... 6 7 0 — 3,725
3,963 750 6,634
Finance lease receivables, undiscounted
—Within one year ....................................... 3,456 911 2,972
—After one year but not more than two years .................. 9 1 1 — 3,100
—After two years but not more than three years ................ — — 1,107
4,367 911 7,179
As at December 31, 2022, 2023 and 2024, carrying amounts of the finance lease receivables are
all denominated in RMB and approximate their fair values at the end of each reporting period, none of
which was past due.
Movements on the Group’s provision for expected credit losses of finance lease receivables are
as follows:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
At January 1, ............................................... (127) (62) (40)
Charge for the year
—Impairment allowance charged ........................... — — (62)
—Impairment allowance reversed ........................... 6 5 2 2 —
At December 31, ............................................ (62) (40) (102)
I-62


--- page 447 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
22 Prepayments, other receivables and amounts due from subsidiaries
(a) Prepayments and other receivables
The Group As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Other receivables
—Rental, bidding and other deposits ............................. 6,032 7,585 6,239
—Others ................................................... 3 4 3
Gross other receivables ....................................... 6,035 7,589 6,242
Less: allowance for impairment of other receivables ................ (152) (129) (122)
5,883 7,460 6,120
Deductible VAT input ........................................ 2,939 9,018 15,561
Prepayment to suppliers ....................................... 23,348 49,778 67,849
Total ...................................................... 32,170 66,256 89,530
The Company As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Other receivables ............................................
—Rental, bidding and other deposits ............................. 2,128 2,340 2,499
—Others ................................................... 3 4 —
Gross other receivables ....................................... 2,131 2,344 2,499
Less: allowance for impairment of other receivables ................ (90) (59) (35)
2,041 2,285 2,464
Deductible VAT input ........................................ 9 0 4 1,965 51
Prepayment to suppliers ....................................... 12,087 23,808 25,324
Total ...................................................... 15,032 28,058 27,839
(b) Amounts due from subsidiaries
The amounts due from subsidiaries are unsecured, interest-free and expected to be collected
over one year.
23 Trade receivables
The Group
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Trade receivables from contracts with customers
—Third parties 506,410 623,179 800,492
Less: allowance for impairment of trade receivables ............... ( 137,550) (212,126) (241,250)
Total trade receivables ...................................... 368,860 411,053 559,242
The carrying amounts of the Group’s trade receivables are mainly denominated in RMB.
I-63


--- page 448 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
23 Trade receivables (continued)
The Group (continued)
The Group decides trading terms with customers on a case-by-case basis. The credit terms
given to trade customers are determined on an individual basis with the normal contractual credit
period mainly within 180 days. The aging analysis of the trade receivables based on date of revenue
recognition is as follows:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Up to 1 year ............................................... 323,966 414,111 563,196
1-2 years ................................................. 133,944 108,459 121,264
More than 2 years .......................................... 48,500 100,609 116,032
506,410 623,179 800,492
Less: allowance for impairment of trade receivables ............... (137,550) (212,126) (241,250)
Total .................................................... 368,860 411,053 559,242
Due to the short-term nature of the current receivables, their carrying amounts are considered to
be approximately the same as their fair values.
The Group does not hold any collateral as security over these debtors as at December 31, 2022,
2023 and 2024.
(i) As at December 31, 2022, the loss allowance of individually impaired trade receivables of the
Group is determined as follows:
For trade receivables that do not share the same characteristics with others 
Individual Gross amount
Expected
credit loss rate Loss allowance Reason
RMB’000 % RMB’000
Trade receivables ........ 19,765 100.0% 19,765 Fully impaired due to
remote possibility of recovery
For trade receivables that share the same characteristics with others:
At December 31, 2022
Gross
amount
Expected
credit loss rate
Loss
allowance
RMB’000 % RMB’000
Up to 1 year ............................................. 323,964 6.0% 19,579
1 to 2 years ............................................. 128,760 49.9% 64,285
More than 2 years ........................................ 33,921 100.0% 33,921
Total .................................................. 486,645 24.2% 117,785
I-64


--- page 449 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
23 Trade receivables (continued)
The Group (continued)
(ii) As at December 31, 2023, the loss allowance of individually impaired trade receivables of the
Group is determined as follows:
For trade receivables that do not share the same characteristics with others 
Individual Gross amount
Expected
credit loss rate Loss allowance Reason
RMB’000 % RMB’000
Trade receivables ........ 6,172 100.0% 6,172 Fully impaired due to
remote possibility of recovery
For trade receivables that share the same characteristics with others:
At December 31, 2023
Gross
amount
Expected
credit loss rate
Loss
allowance
RMB’000 % RMB’000
Up to 1 year ............................................. 414,111 11.8% 48,791
1 to 2 years ............................................. 106,956 57.2% 61,223
More than 2 years ........................................ 95,940 100.0% 95,940
Total .................................................. 617,007 33.4% 205,954
(iii) As at December 31, 2024, the Group did not identify any individually impaired trade
receivables for the assessment of loss allowance.
For trade receivables that share the same characteristics with others 
At December 31, 2024
Gross
amount
Expected
credit loss rate
Loss
allowance
RMB’000 % RMB’000
Up to 1 year ............................................. 563,196 12.4% 69,851
1 to 2 years ............................................. 121,264 45.7% 55,367
More than 2 years ........................................ 116,032 100.0% 116,032
Total .................................................. 800,492 30.1% 241,250
The movement on the provision for impairment of trade receivables please refer to note 3.1.
The Company
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Trade receivables from contracts with customers
—Third parties .......................................... 110,616 155,735 182,133
Less: allowance for impairment of trade receivables ................ (31,672) (59,078) (67,494)
Total trade receivables ........................................ 78,944 96,657 114,639
The carrying amounts of the Company’s trade receivables are mainly denominated in RMB.
I-65


--- page 450 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
23 Trade receivables (continued)
The Company (continued)
The Company decides trading terms with customers on a case-by-case basis. The credit terms
given to trade customers are determined on an individual basis with the normal contractual credit
period mainly within 180 days. The aging analysis of the trade receivables based on date of revenue
recognition is as follows:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Up to 1 year ................................................ 64,926 93,664 115,567
1-2 years ................................................... 27,593 29,163 26,558
More than 2 years ............................................ 18,097 32,908 40,008
110,616 155,735 182,133
Less: allowance for impairment of trade receivables ................ (31,672) (59,078) (67,494)
Total ...................................................... 78,944 96,657 114,639
Due to the short-term nature of the current receivables, their carrying amounts are considered to
be approximately the same as their fair values.
The Company does not hold any collateral as security over these debtors as at December 31,
2022, 2023 and 2024.
(i) As at December 31, 2022, the loss allowance of individually impaired trade receivables of the
Company is determined as follows:
For trade receivables that do not share the same characteristics with others:
Individual Gross amount
Expected
credit loss rate Loss allowance Reason
RMB’000 % RMB’000
Trade receivables ........ 2,802 100.0% 2,802 Fully impaired due to
remote possibility of recovery
For trade receivables that share the same characteristics with others:
At December 31, 2022
Gross
amount
Expected
credit loss rate
Loss
allowance
RMB’000 % RMB’000
Up to 1 year ............................................. 64,926 5.4% 3,538
1 to 2 years ............................................. 27,593 36.4% 10,037
More than 2 years ........................................ 15,295 100.0% 15,295
Total .................................................. 107,814 26.8% 28,870
I-66


--- page 451 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
23 Trade receivables (continued)
The Company (continued)
(ii) As at December 31, 2023, the loss allowance of individually impaired trade receivables of the
Company is determined as follows:
For trade receivables that do not share the same characteristics with others 
Individual
Gross amount
Expected
credit loss rate Loss allowance Reason
RMB’000 % RMB’000
Trade receivables ......... 2,802 100.0% 2,802
Fully impaired due to remote
possibility of recovery
For trade receivables that share the same characteristics with others 
At December 31, 2023
Gross
amount
Expected
credit loss rate
Loss
allowance
RMB’000 % RMB’000
Up to 1 year ............................................. 93,664 11.7% 10,996
1 to 2 years ............................................. 29,163 52.0% 15,174
More than 2 years ........................................ 30,106 100.0% 30,106
Total .................................................. 152,933 36.8% 56,276
(iii) As at December 31, 2024, the Company did not identify any individually impaired trade
receivables for the assessment of loss allowance.
For trade receivables that share the same characteristics with others:
At December 31, 2024
Gross
amount
Expected
credit
loss rate
Loss
allowance
RMB’000 % RMB’000
Up to 1 year ................................................ 115,567 13.4% 15,433
1 to 2 years ................................................. 26,558 45.4% 12,053
More than 2 years ............................................ 40,008 100.0% 40,008
Total ...................................................... 182,133 37.1% 67,494
24 Inventories
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Purchased hardware and software ............................... 23,333 23,301 28,435
Contract fulfillment cost ...................................... 17,056 53,021 119,339
40,389 76,322 147,774
Less: allowance for impairment of inventories ..................... (6,775) (8,469) (7,482)
33,614 67,853 140,292
(a) Amounts recognized in profit or loss
Inventories recognized as cost of sales and services during the years ended December 31, 2022,
2023 and 2024 was RMB340.9 million, RMB411.8 million and RMB550.1 million, respectively.
I-67


--- page 452 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
25 Financial assets at fair value through profit or loss
The Group
(a) Classification of financial assets at FVPL
Financial assets measured at FVPL include the following:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Non-current assets
Unlisted equity investments .................................... 21,680 30,588 24,347
Current assets
Investments in wealth management products ...................... — 69,010 —
(b) Amounts recognized in profit or loss
During the Track Record Period, the following gains were recognized in profit or loss:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Fair value (losses)/gains on investments in unlisted equity
investments ............................................... (1,342) 8,908 (8,491)
Fair value gains on investments in wealth management products ....... 9 9 5 3,110 996
(347) 12,018 (7,495)
Risk exposure and fair value measurements
Information about the Group’s exposure to financial risk is provided in note 3.1 and
information about the methods and assumptions used in determining fair value are set out in note 3.3.
The Company
(a) Classification of financial assets at FVPL
Financial assets measured at FVPL include the following:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Non-current assets
Unlisted equity investments .................................... 21,680 30,588 22,097
Current assets
Investments in wealth management products ...................... — 10,010 —
I-68


--- page 453 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
25 Financial assets at fair value through profit or loss (continued)
The Company (continued)
(b) Amounts recognized in profit or loss
During the Track Record Period, the following gains were recognized in profit or loss:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Fair value (losses)/gains on investments in unlisted equity
investments ............................................... (1,342) 8,908 (8,491)
Fair value gains on investments in wealth management products ....... 8 7 4 1,729 61
(468) 10,637 (8,430)
26 Cash and cash equivalents
The Group
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Cash at banks ............................................... 74,118 379,224 160,017
Less: restricted cash(a) ........................................ — — (3,541)
Cash and cash equivalents ..................................... 74,118 379,224 156,476
Cash and cash equivalents of the Group are denominated in the following currencies:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
U S D ...................................................... 4,006 3,101 3,376
H K D ...................................................... 1 1 1
R M B...................................................... 70,111 376,122 153,099
Total ...................................................... 74,118 379,224 156,476
The Company
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Cash at banks ............................................... 31,973 84,608 12,803
Less: restricted cash .......................................... — — (590)
Cash and cash equivalents ..................................... 31,973 84,608 12,213
Cash and cash equivalents of the Company are denominated in the following currencies:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
U S D ...................................................... 9 6 2 7 6
R M B...................................................... 31,011 84,601 12,207
Total ...................................................... 31,973 84,608 12,213
I-69


--- page 454 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
26 Cash and cash equivalents (continued)
The Company (continued)
(a) As at December 31, 2024, the restricted cash was in relation to deposits for issuance of letter of
guarantee and a dispute in which a subsidiary of the Company was associated defendant
without primary obligation.
27 Share capital
Number of
shares
Share
capital
RMB’000
Authorized and issued
At January 1, 2022 ................................................ 63,573,428 63,573
Capital injection from Series D2 investors (a) ............................ 74,792 75
At December 31, 2022 .............................................. 63,648,220 63,648
Capital injection from Series D3 investors (a) ............................ 5,744,253 5,744
At December 31, 2023 .............................................. 69,392,473 69,392
At December 31, 2024 .............................................. 69,392,473 69,392
(a) The Company completed its Series D2 and Series D3 financing for the years ended December
31, 2022 and 2023, respectively, please see note 28 and note 30 for details.
28 Treasury stock and reserves
The Group
Treasury
stock
Reserve
Share
premium
Share-based
payments
reserves
Other
reserves
Total
reserves
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2022 .................. (1,831,637) 1,204,685 326,326 471 1,531,482
Issuance of equity interests to Series D2
investor (note 30) .................. — 9,634 — — 9,634
Recognition of redemption liabilities for
the preferred rights granted to Series D2
investors (note 30) ................. (10,000) — — — —
Modification to granted redemption
liabilities (note 30(ii)(b)) ............ — 3,709 — — 3,709
Recognition of financial liabilities at fair
value through profit or loss for the anti-
dilution rights newly granted to Series
D2 investors (note 31) .............. — (362) — — (362)
Currency translation differences ........ — — — 8 5 8 5
At December 31, 2022 ................ (1,841,637) 1,217,666 326,326 556 1,544,548
I-70


--- page 455 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
28 Treasury stock and reserves (continued)
The Group (continued)
Treasury
stock
Reserve
Share
premium
Share-based
payments
reserves
Other
reserves
Total
reserves
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2023 .................. (1,841,637) 1,217,666 326,326 556 1,544,548
Issuance of equity interests to Series D3
investor (note 30) .................. — 696,741 — — 696,741
Share-based payment compensation
( n o t e3 2 )......................... — — 4,532 — 4,532
Recognition of redemption liabilities for
the preferred rights granted to Series D3
investors (note 30) ................. (722,000) — — — —
Modification to granted redemption
liabilities (note 30 (ii)(b)) ........... — 1,379 — — 1,379
Recognition of financial liabilities at fair
value through profit or loss for the anti-
dilution rights newly granted to Series
D3 investors (note 31) .............. — (985) — — (985)
Acquisition of non-controlling interests . . — (869) — — (869)
Currency translation differences ........ — — — 2 9 4 2 9 4
At December 31, 2023 ............... (2,563,637) 1,913,932 330,858 850 2,245,640
At January 1, 2024 .................. (2,563,637) 1,913,932 330,858 850 2,245,640
Currency translation differences ........ — — — 6 0 6 0
At December 31, 2024 ............... (2,563,637) 1,913,932 330,858 910 2,245,700
The Company
Treasury
stock
Reserve
Share
premium
Share-based
payments
reserves
Other
reserves
Total
reserves
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2022 (1,831,637) 1,204,685 316,937 686 1,522,308
Issuance of equity interests to Series D2
investor (note 30) .................. — 9,634 — — 9,634
Recognition of redemption liabilities for
the preferred rights newly granted to
Series D2 investor (note 30) ......... (10,000) — — — —
Modification to granted redemption
liabilities (note 30(ii)(b)) ............ — 3,709 — — 3,709
Recognition of financial liabilities at fair
value through profit or loss for the anti-
dilution rights newly granted to Series
D2 investor (note 31) ............... — (362) — — (362)
At December 31, 2022 ............... ( 1 , 841,637) 1,217,666 316,937 686 1,535,289
At January 1, 2023 .................. (1,841,637) 1,217,666 316,937 686 1,535,289
Issuance of equity interests to Series D3
investors (note 30) ................. — 696,741 — — 696,741
Recognition of redemption liabilities for
the preferred rights newly granted to
Series D3 investors (note 30) ........ (722,000) — — — —
Share-based payment compensation
(note 32) ......................... — — 2,381 — 2,381
Modification to granted redemption
liabilities (note 30(ii)(b)) ............ — 1,379 — — 1,379
Recognition of financial liabilities at fair
value through profit or loss for the anti-
dilution rights newly granted to
Series D3 investors (note 31) ........ — (985) — — (985)
At December 31, 2023 ............... (2,563,637) 1,914,801 319,318 686 2,234,805
At December 31, 2024 ............... (2,563,637) 1,914,801 319,318 686 2,234,805
I-71


--- page 456 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
29 Accumulated deficit
The Group
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
At beginning of the year ............................. (1,291,406) (1,657,418) (2,032,879)
Net loss for the year ................................ (366,012) (375,461) (452,364)
At end of the year .................................. (1,657,418) (2,032,879) (2,485,243)
The Company
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
At beginning of the year ............................. (880,125) (1,197,818) (1,521,427)
Net loss for the year ................................ (317,693) (323,609) (417,139)
At end of the year .................................. (1,197,818) (1,521,427) (1,938,566)
30 Redemption liabilities
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Redemption liabilities ................................ 2,108,990 3,038,456 3,303,051
Since its incorporation in 2012, the Company has completed several rounds of financing
including Series Angel, Series A, Series B, Series C, Series C+, Series D, Series D+, Series D1, Series
D2 and Series D3, each leading to an increase in the capital of the Company.
The details of financing undertaken in the Track Record Period are as follows.
Series D2 financing
In June 2022, the Group and then existing shareholders entered into an investment agreement
(the “Series D2 Investment Agreement”), with Guangdong Jinhongsheng Venture Capital Partnership
(L.P.) (the “Series D2 investor”), pursuant to which the Series D2 Investor injected total capital of
RMB10.0 million into the Company, the Company then issued share capital of approximately RMB75
thousand to the Series D2 Investor (referred to as the “Series D2 Capital Injection”), and granted the
Series D2 Investor with certain preferred rights, see below (i) for key term summary.
Series D3 financing
In April to June 2023, the Group and then existing shareholders entered into investment agreement
(the “Series D3 Agreements”) with Henan Yudongnan Zhanxin Industry Venture Capital Fund Partnership,
Jinan Tongxin Future Industry Investment Partnership (Limited Partnership), Tianjin Pushu Enterprise
Management Consulting Partnership, Deyang Digital New Town Construction and Development Co., Ltd.,
Deyang Jinghua Industrial Investment Development Co., Ltd., Xinxin Xiangrong Education Technology
(Beijing) Co., Ltd. and Hangzhou Fuyang Yaofu Equity Investment Partnership (Limited Partnership)(the
“Series D3 investors”), pursuant to which the Company issued share capital of approximately RMB5.7
million to the Series D3 investors (refer to as the “Series D3 Capital Injection”), and granted the Series D3
investors with certain preferred rights, see below (i) for key term summary.
I-72


--- page 457 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
30 Redemption liabilities (continued)
(i) Key terms of preferred rights granted
Redemption right
Series Angel, Series A, Series B, Series C, Series C+, Series D, Series D1, Series D+, Series
D2, Series D3 investors have rights to require the Company to redeem their investments if (i) the
Company fails to achieve a qualified Initial Public Offering (“QIPO”), which means that the
Company’s shares be listed on a well-known stock exchange (including but not limited to Shanghai
Stock Exchange and Shenzhen Stock Exchange, or other overseas exchanges) before June 30, 2026; or
(ii) the application of Initial Public Offering (“IPO”) is rejected by the relevant listing regulatory
authorities (including but not limited to the China Securities Regulatory Commission and the stock
exchange), but exceptions are made where the Company cannot be listed due to reasons that cannot be
attributed to the Company or its Founding Shareholders; or (iii) the certified public accountant
appointed by the Company cannot issue an unqualified audit report, making it impossible for the
Company to go public; or (iv) the chairman or general manager of the Company are legally identified
as having constituted an economic crime, and the chairman or key individual of the Company who is
served as or appointed by the Founding Shareholders has caused a significant adverse impact on the
Company.
Pursuant to the Series D3 Agreements, these preferred rights will be automatically terminated
upon the Company’s submission of the IPO prospectus to the China Securities Regulatory
Commission, or any exchanges approved by the Company’s general meeting of shareholders or the
Board of Directors, and shall be immediately and automatically reinstated and shall be deemed to have
never been terminated if any of the following occurs after the date of automatic termination:
i) The Company voluntarily withdraws its initial public offering and listing application;
ii) The Company fails to pass the review of China Securities Regulatory Commission or other
stock exchange within 30 months from the date of filing the formal listing application for reasons other
than the Government, or the Company’s listing sponsor withdraws its listing sponsor;
iii) The Company has not completed the listing transaction on the stock exchange for any
reason within 6 months from the date of the IPO of its shares and the issuance approval of the China
Securities Regulatory Commission or stock exchange for its listing application.
The redemption amount is the total amount paid by the Investors to obtain the equity interest of
the Company, plus an annual simple interest rate of 10% for a period of time commencing from certain
equity delivery date stated in the contracts to the date triggering redemption, reduce the dividends (if
any) declared and paid to these the Investors.
Anti-dilution rights
If the Company increases its share at a price lower than the price paid by the Investors on a per
share basis, the Investors have a right to require: (1) the Founding Shareholders to transfer the equity
interests of the Company they directly or indirectly held to the Investors at the lowest price allowed by
the law; or (2) the Company to issue new share for nominal consideration to the Investors; or (3) the
Company or Founding Shareholders to compensate the Investors in cash.
I-73


--- page 458 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
30 Redemption liabilities (continued)
(ii) Presentation and classification
The redemption rights granted to the Investors constitute as the Company’s obligations to
repurchase its own equity instruments. These obligations were recognized as redemption
liabilities which are initially measured at fair value (representing the present value of the expected cash
flows for settling the related obligations if these rights are exercised by the Investors) and subsequently
measured at amortized cost. Interests from the redemption liabilities are charged in finance cost.
The movements of redemption liabilities during the Track Record Period are:
RMB’000
At January 1, 2022 1,926,270
Recognition of redemption liabilities (a) ...................................... 10,000
Modification of redemption liabilities (b) ..................................... ( 3,709)
Charged to finance costs .................................................. 176,429
At December 31, 2022 2,108,990
At January 1, 2023 2,108,990
Recognition of redemption liabilities (a) ...................................... 722,000
Modification of redemption liabilities (b) ..................................... (1,379)
Charged to finance costs .................................................. 208,845
At December 31, 2023 3,038,456
At January 1, 2024 3,038,456
Charged to finance costs .................................................. 264,595
At December 31, 2024 ................................................... 3,303,051
(a) Upon the Series D2 and D3 Capital Injection, the Investors were granted with preferred rights,
including redemption rights and other rights, and the Company recognized the redemption
rights as redemption liabilities measured at amortized cost, with a corresponding increase of
treasury stock. The difference between fair value of these equities with and without preferred
rights was recognized as share-based compensation, see note 32 for detail.
(b) As mentioned above in note (a), along with the grant of preferred rights in Series D2 Capital
Injection and Series D3 Capital Injection, the exercise date of the redemption rights of existing
investors was deferred pursuit to the renewed shareholders’ preferred right agreements and not
considered as a substantial modification. The deferral of above redemption right terms resulted
in a reduction of redemption liability and a modification gain according to IFRS 9. All investors
are ordinary shareholders and the Company considered that the investor’s agreement to extend
the exercise date of the redemption option was a non reciprocal transaction which could be
regarded as a transaction where the investor is acting in their capacity as a shareholder and in
substance an equity transaction. The above modification resulted in a decrease of redemption
liabilities and a modification gain which is recognized as a credit in equity. See note 28 for
reference.
31 Financial liabilities at fair value through profit or loss
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Derivative .............................................. 6 6 7 2,383 2,370
I-74


--- page 459 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
31 Financial liabilities at fair value through profit or loss (continued)
The financial liabilities at FVPL represent derivative financial liabilities arising from anti-
dilution rights (note 30(i)) granted to the Investors. The financial liabilities are measured at fair value.
The Company has adopted the interpolation method, discounted cash flow method and equity
allocation model to determine 100% of its equity value. Based on the fair value of 100% equity value,
the Company has used the “with and without” model based on a bi-nominal model to determine the fair
value of anti-dilution rights.
Key assumptions used to determine the fair value of anti-dilution rights are listed in note 3.3
(a) (iii).
32 Share-based compensation
(i) 2023 Employee Incentive Scheme
On April 12, 2023, the Company adopted the 2023 Employee Incentive Scheme through Yunsi
Shangzhi (Tianjin) Enterprise Management Consulting Partnership (Limited Partnership) (“Yunsi
Shangzhi”) and Tianjin Yunsi Shangxin Enterprise Management Consulting Partnership (Limited
Partnership) (“Yunsi Shangxin”) (collectively referred to as the “Employee Incentive Platforms”).
Huang Wei, the CEO and one of the shareholders of the Company, used his own shares as the award
under 2023 Employee Incentive Scheme for granting the scheme participants. An award under the
2023 Employee Incentive Scheme gives a scheme participant in the 2023 Employee Incentive Scheme
an option (the “Options”) when granted the award to subscribe for interests in the Employee Incentive
Platforms at the consideration separately agreed in the stock incentive agreement entered into among
the Company, the General Partner and the relevant Scheme Participant. Upon becoming the limited
partner of the Employee Incentive Platforms, the selected Scheme Participants indirectly receive
economic interest in the corresponding number of underlying Shares held by the Employee Incentive
Platforms. Through the 2023 Employee Incentive Scheme, a total of 22,327 share options have been
granted to the scheme participants through the Employee Incentive Platforms, representing 60,555
shares of the Company, with an exercise price of RMB 1 Yuan. The Options have been immediately
vested upon grant date of April 12, 2023.
The share-based compensation in relation to the grant of certain preferred rights and 2024
Employee Incentive Scheme during the Track Record Period was recorded as follows:
Years ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Research and development expenses (i) ...................... — 4,000 —
Selling and marketing expenses (i) .......................... — 5 3 2 —
— 4,532 —
I-75


--- page 460 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
32 Share-based compensation (continued)
(ii) Fair value of the underlying equity of the Company and share options
The Company has adopted the equity allocation model to determine the fair value of the
underlying equity of the Company, and recognized share-based compensation in relation to the
grant of certain preferred rights based on the fair value of the underlying equity. The Company
has used the Binomial option-pricing model to determine the fair value of the share options
based on the fair value of the underlying equity of the Company as at the grant date. Key
assumptions are set out below:
As at April 12,
2023
Fair value of per share options (RMB Yuan) ................................ 74.8
Exercise price (RMB Yuan) ............................................. 1 . 0
Risk-free interest rate .................................................. 1.8%-2.5%
Dividend yield ....................................................... —
Expected volatility 40.4%-54.5%
33 Trade and other payables
The Group
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Trade payables
— Amounts due to third parties ......................... 156,482 135,857 164,796
Tax payables ........................................... 3,880 5,112 12,954
Other payables:
— Listing expenses .................................. 6,910 14,303 26,806
— Technology service fees ............................ 20,187 20,906 23,764
— Deposits ......................................... 8 0 7 8 0 0 7 7 9
— Borrowing from sales and leaseback .................. — 1,000 —
— Others .......................................... 4,516 3,477 3,796
192,782 181,455 232,895
(a) The carrying amounts of trade and other payables are considered to be approximate to their fair
values, due to their short-term nature. As at December 31, 2022, 2023 and 2024, the carrying
amounts of trade and other payables were all denominated in RMB.
(b) Aging analysis of the trade payables based on invoice date at the end of each reporting period
are as follows:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Up to 1 year ............................................ 94,067 81,486 109,792
1 to 2 years ............................................. 56,452 16,226 21,610
Over 2 years ............................................ 5,963 38,145 33,394
156,482 135,857 164,796
I-76


--- page 461 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
33 Trade and other payables (continued)
The Company
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Trade payables
— Amounts due to third parties ......................... 25,985 25,020 64,349
Tax payables ........................................... 7 9 3 1,053 8,582
Other payables
— Amounts due to subsidiaries ......................... 28,004 2,151 58,619
— Listing expenses .................................. 6,910 14,303 26,806
— Technology service fees ............................ 17,894 16,638 18,774
— Deposits ......................................... — — 1 2 0
— Borrowing from sales and leaseback .................. — 1 6 7 —
— Others .......................................... 1,640 1,201 1,458
81,226 60,533 178,708
(a) The carrying amounts of trade and other payables are considered to be approximated to their
fair values, due to their short-term nature. As at December 31 2022, 2023 and 2024, the
carrying amounts of trade and other payables were all denominated in RMB.
(b) Aging analysis of the trade payables based on invoice date at the end of each reporting period
are as follows:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Up to 1 year ............................................ 15,244 17,252 56,338
1 to 2 years ............................................. 9,747 3,281 1,733
Over 2 years ............................................ 9 9 4 4,487 6,278
25,985 25,020 64,349
34 Deferred income tax assets and liabilities
Deferred income taxes are calculated in full on temporary differences under the liability method
using the tax rates at which are expected to be applied at the time of reversal of the temporary
differences.
I-77


--- page 462 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
34 Deferred income tax assets and liabilities (continued)
As at December 31, 2022, 2023 and 2024, the deferred tax assets and deferred tax liabilities is
as follows:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Deferred tax assets:
— to be recovered after 12 months ...................... 4,389 4,820 5,516
— to be recovered within 12 months ..................... 4 8 0 6 3 0 1,514
Offset by deferred tax liabilities ............................ (4,470) (5,397) (6,735)
Net deferred income tax assets ............................. 3 9 9 5 3 2 9 5
Deferred tax liabilities:
— to be recovered after 12 months ...................... (3,075) (4,555) (5,527)
— to be recovered within 12 months ..................... (1,395) (842) (1,208)
Offset by deferred income tax assets ......................... 4,470 5,397 6,735
Net deferred income tax liabilities ........................... — — —
(a) The movements in deferred income tax assets and deferred income tax liabilities during the
Track Record Period are as follows:
Deferred
tax assets
- Lease
liabilities
Deferred
tax assets
- tax
loss
Deferred tax
liabilities
- Right-of-
use assets
Deferred tax
liabilities -
Investments
measured at
fair value
through
profit or loss Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at January 1, 2022 .............. 2,287 2,862 (2,110) (2,862) 177
Credit/(charged) to profit or loss ....... 5 0 (330) 172 330 222
As at December 31, 2022 ............ 2,337 2,532 (1,938) (2,532) 399
(Charged)/credit to profit or loss ....... ( 575) 1,156 229 (1,156) (346)
As at December 31, 2023 ............ 1,762 3,688 (1,709) (3,688) 53
Credit/(charged) to profit or loss ....... 6 1 4 9 6 6 (372) (966) 242
As at December 31, 2024 ............ 2,376 4,654 (2,081) (4,654) 295
35 Salary and welfare payables
The Group
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Wages, salaries and bonuses ............................... 8,928 9,182 9,475
Pension costs (i) ......................................... 6,060 1,960 2,074
Other social security costs (i) ............................... 4,436 956 978
Housing funds .......................................... 2 7 4 5 5 6 5 4 4
Others ................................................. 3,268 2,579 1,981
22,966 15,233 15,052
I-78


--- page 463 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
35 Salary and welfare payables (continued)
The Company
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Wages, salaries and bonuses ............................... 4,249 4,631 4,782
Pension costs (i) ......................................... 5,912 1,069 1,138
Other social security costs (i) ............................... 1,809 522 556
Housing funds .......................................... 4 2 6 9 7 0
Others ................................................. 1,831 1,134 1,088
13,843 7,425 7,634
(i) In 2022, the government announced the Circular on Issues Related to Temporary Suspension
of Social Insurance Premiumsஷѓ
, pursuant to
which the Company applied for holdover on payment of such social securities. The accrued but
not paid amount is RMB 6.9 million as at December 31, 2022, which has been fully paid as of
December 31, 2023.
36 Other non-current liabilities
The Group
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Provisions .............................................. 6 4 0 1,434 7,060
Deferred government grants (a) ............................. 44,393 25,000 22,565
45,033 26,434 29,625
The Company
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Provisions .............................................. 1 6 0 3 4 1 5,433
Deferred government grants (a) ............................. 23,497 9,817 8,542
23,657 10,158 13,975
(a) The Group received government grants from local governments as support for research and
development expenses relating to innovation activities.
37 Borrowings
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Bank loans, secured (a) ................................... — 40,000 50,000
Unsecured bank loans .................................... 35,000 25,000 60,000
Borrowings from discounted notes receivable (b) ............... — — 35,378
35,000 65,000 145,378
I-79


--- page 464 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
37 Borrowings (continued)
As at December 31, 2022, 2023 and 2024, the Group’s borrowings were repayable as follows:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Within 1 year ........................................... 35,000 65,000 145,378
The weighted average effective interest rate of bank loans for the years ended December 31,
2022, 2023 and 2024 was 4.0%, 4.9% and 3.4% per annum, respectively.
(a) The secured bank loans were amounted to RMB50 million as at December 31, 2024, of which
RMB45 million was secured by the credit of the Group, RMB5 million was secured by the
assets by a subsidiary of the Group.
(b) As at December 31, 2024, the borrowings generated from discounted notes receivable to a bank
were amounted to RMB35.4 million.
38 Commitments
(a) Capital commitments
(i) On April 25, 2023, the Group entered into an agreement with Jinan Supercomputing Industry
Development Co., LTD (
ʮ̡) to acquire office space in National
Supercomputing Center Jinan Science Park (Ҧ෤) for an estimated cash
consideration between RMB90 million and RMB100 million. Pursuant to this agreement, as of
December 31, 2023 and 2024, the Company had accumulatively paid RMB47.4 million,
representing approximately 50% of total expected purchase consideration. On May 27, 2024,
the two parties entered into a supplemental agreement to pay the residual amounts before
September 30, 2025.
(ii) On January 9, 2024, a subsidiary of the Group, Yunzhisheng (Xinyang) Digital Technology
Co., Ltd. (
ᑊ(ජ)ʮ̡) and Xinyang Huaxin Construction Investment Henan
Southeast Development and Construction Co., Ltd. (ʮ̡)
jointly invested to establish Xinyang Huayun Industrial Park Construction Co., Ltd. (ජശථ
ʮ̡) and promised to contribute RMB10 million in cash according to
Articles of association, representing 5% of the shareholding. The Group has invested RMB 2.3
million, which was accounted for as financial assets at fair value through profit or loss as of
December 31, 2024.
(b) Lease commitments
Certain lease arrangements were contracted before year-end while the related lease
commencement date is in the following year. As the underlying assets were not available for use by the
Company and the Company cannot control the related assets before the lease commencement date,
hence no right-of-use and lease liabilities are recorded at year-end before the lease commencement.
I-80


--- page 465 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
38 Commitments (continued)
(b) Lease commitments (continued)
Such lease commitments at the end of each reporting period but not recognized as liabilities is
as follows:
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Within 1 year ........................................... 1,987 — 533
After 1 year but within 2 years .............................. 1,998 — 336
After 2 years but within 3 years ............................. 1,169 — 421
After 3 years but within 4 years ............................. 9 4 0 — 4 8 1
After 4 years but within 5 years ............................. 1,011 — 200
Total .................................................. 7,105 — 1,971
For other lease arrangements which have been in use or control before the year-end, the
Company records them as right-of-use assets and lease liabilities accordingly.
39 Related party transactions
Parties are considered to be related if one party has the ability, directly or indirectly, to control
the other party or exercise significant influence over the other party in making financial and operation
decisions. Parties are also considered to be related if they are subject to common control. Members of
key management and their close family members of the Group are also considered as related parties.
The following transactions were carried out between the Group and its related parties during the
years 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.
Key management personnel compensation
Key management includes director and senior officers. The compensation paid or payable to
key management for employee services is shown below:
Year ended December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Wages, salaries and bonuses ............................... 7,740 8,438 9,478
Pension costs ........................................... 6 6 4 7 2 1 7 5 6
Housing benefits ........................................ 4 1 2 5 0 3 5 2 8
Other social security costs ................................. 4 5 7 4 4 5 4 6 4
9,273 10,107 11,226
I-81


--- page 466 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
40 Cash flow information
(a) Cash used in operations
Reconciliation of loss for the year to cash used in operations:
Year ended December 31,
Note 2022 2023 2024
RMB’000 RMB’000 RMB’000
Loss before income tax: .............................. ( 375,580) (373,589) (454,373)
Adjustments for:
Depreciation and amortization ..................... 9 22,240 19,876 25,849
Share-based compensation ........................ 3 2 — 4,532 —
Share of profit of associates ....................... 1 3 (1,092) 2,617 —
Net fair value losses on financial liabilities at fair value
through profit or loss .......................... 3 1 3 5 7 3 1 (13)
Net fair value losses/(gains) on financial assets at fair
value through profit or loss ..................... 2 5 3 4 7 (12,018) 7,495
Net impairment losses on financial assets and contract
assets recognized in profit or loss ................ 3 71,976 91,346 48,438
Finance costs – net .............................. 1 1 177,361 210,895 268,645
Net impairment losses on inventories ............... 2 4 3,179 3,606 (987)
Disposal loss of property and equipment ............. 3 3 1 3 5 2 7
Disposal gains of right-of-use assets ................ — (438) 745
Exchange gains ................................ ( 244) 252 35
Change in working capital:
—Inventories .................................. 10,058 (37,845) (71,452)
—Trade receivables ............................. ( 176,042) (133,367) (197,014)
—Contract assets ............................... 1,524 (432) (403)
—Prepayment and other receivables ................ 2,888 (34,063) (23,267)
—Trade and other payables ....................... 63,929 (12,734) 52,957
—Salary and welfare payable ..................... 9,944 (7,733) (181)
—Contract liabilities ............................ 17,896 8,927 21,461
—Lease receivables ............................. 2,977 3,235 2,069
—Other non-current liabilities ..................... 2,630 (18,599) 3,191
Cash used in operations .............................. (165,941) (284,666) (316,778)
(b) Non-cash investing and financing activities
The major non-cash investing and financing activities during the Track Record Period mainly
include (i) the right-of-use assets obtained in exchange for the lease liabilities as described in note 17,
and (ii) interest expense on redemption liabilities charged to finance costs as described in note 30.
I-82


--- page 467 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
40 Cash flow information (continued)
(c) Net debt reconciliation
As at December 31,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Cash and cash equivalents ........................... 74,118 379,224 156,476
Wealth management products at fair value through profit or
loss ........................................... — 69,010 —
Redemption liabilities .............................. ( 2,108,990) (3,038,456) (3,303,051)
Financial liabilities at fair value through profit or loss ..... (667) (2,383) (2,370)
Borrowings ....................................... (35,000) (65,000) (145,378)
Other payable-borrowing from sales and leaseback ....... — (1,000) —
Lease liabilities ................................... (18,767) (9,598) (18,248)
Net debt ......................................... ( 2,089,306) (2,668,203) (3,312,571)
*The Company defines its net debt as cash and cash equivalents plus wealth management
products at FVPL, minus financial liabilities at FVPL, redemption liabilities, borrowing and
lease liabilities at each year.
Liabilities from financing activities Other assets
Leases
Financial
liabilities at
fair value
through
profit or
loss
Redemption
liabilities Borrowings
Cash and
cash
equivalents
Wealth
management
products at
fair value
through
profit or loss Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Net debt as at
January 1,
2022 ......... (20,711) (270) (1,926,270) (4,000) 129,650 80,859 (1,740,742)
Cash flows ...... 10,858 — — (31,000) (55,532) (81,854) (157,528)
Changes in fair
value ........ — (35) — — — 995 960
Additions of lease
liabilities ...... (8,704) — — — — — (8,704)
Additions of
redemption
liabilities ...... — — (10,000) — — — (10,000)
Additions of
financial
liabilities
through profit or
loss .......... — (362) — — — — (362)
Government
concession .... 6 9 6 — — — — — 6 9 6
Modification of
redemption
liabilities ...... — — 3,709 — — — 3,709
Finance costs
recognized .... (906) — (176,429) — — — (177,335)
Net debt as at
December 31,
2022 ......... (18,767) (667) (2,108,990) (35,000) 74,118 — (2,089,306)
I-83


--- page 468 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
40 Cash flow information (continued)
(c) Net debt reconciliation (continued)
Liabilities from financing activities Other assets
Leases
Financial
liabilities
at fair value
through
profit or
loss
Redemption
liabilities Borrowings
Other
payable-
borrowing
from sales
and
leaseback
Cash and
cash
equivalents
Wealth
management
products at
fair value
through
profit or loss Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Net debt as at
January 1,
2023 ........ (18,767) (667) (2,108,990) (35,000) — 74,118 — (2,089,306)
Cash flows ..... 15,787 — — (30,000) (1,000) 305,106 65,900 355,793
Changes in fair
value ....... — (731) — — — — 3,110 2,379
Additions of
lease
liabilities .... (4,217) — — — — — — (4,217)
Additions of
redemption
liabilities .... — — (722,000) — — — — (722,000)
Additions of
financial
liabilities
through profit
or loss ...... — (985) — — — — — (985)
Modification of
leasing
contracts .... (1,670) — — — — — — (1,670)
Modification of
redemption
liabilities .... — — 1,379 — — — — 1,379
Finance costs
recognized . . . (731) — (208,845) — — — — (209,576)
Net debt as at
December 31,
2023 ........ (9,598) (2,383) (3,038,456) (65,000) (1,000) 379,224 69,010 (2,668,203)
Net debt as at
January 1,
2024 ........ (9,598) (2,383) (3,038,456) (65,000) (1,000) 379,224 69,010 (2,668,203)
Cash flows ..... 12,956 — — (80,378) 1,000 (222,748) (70,006) (359,176)
Changes in fair
value ....... — 1 3 — — — — 9 9 6 1,009
Additions of
lease
liabilities .... (20,586) — — — — — — (20,586)
Finance costs
recognized . . . (1,020) — (264,595) — — — — (265,615)
Net debt as at
December 31,
2024 ........ (18,248) (2,370) (3,303,051) (145,378) — 156,476 — (3,312,571)
I-84


--- page 469 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
41 Benefits and interests of directors
(a) Directors’ emoluments
The remuneration of every director for the years ended December 31, 2022, 2023 and 2024
were set out below:
Note
Wages,
salaries
and
bonuses
Pension
costs
defined
contribution
plans
Other
social
security
costs
Housing
benefits Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
For the Year ended December 31, 2022
Executive directors
Liang Jia’en ....................... ( i ) 6 5 1 6 0 3 7 4 3 7 9 1
Huang Wei ........................ (ii) 622 60 37 43 762
Kang Heng ........................ (iii) 403 59 37 43 542
Li Xiaohan ........................ (iv) 527 60 37 43 667
Liu Shengping ...................... ( v ) 1,080 60 37 43 1,220
Li Peng ........................... (vi) 1,052 60 37 43 1,192
Non-executive directors
Kuang Ziping ...................... (vii) — — — — —
Zhou Jiong ........................ (viii) — — — — —
Li Zhichao ......................... (ix) — — — — —
Liang Xiaodong .................... ( x i ) — — — — —
Ma Jingxian ....................... (xii) — — — — —
Hu Jianjun ......................... ( x v ) 7 6 — — — 7 6
Fan Jian ........................... ( x v i ) 7 6 — — — 7 6
Zhao Hongfei ...................... ( x x i ) 6 — — — 6
Supervisor
Shan Bo ........................... ( xxiii) 743 60 37 43 883
R e nH e ........................... ( xxiv) 625 60 37 43 765
Hong Zhao ........................ ( xxv) — — — — —
5,861 479 296 344 6,980
I-85


--- page 470 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
41 Benefits and interests of directors (continued)
(a) Directors’ emoluments (continued)
Note
Wages,
salaries
and
bonuses
Pension costs
defined
contribution
plans
Other
social
security
costs
Housing
benefits Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
For the Year ended December 31, 2023
Executive directors
Liang Jia’en ....................... ( i ) 6 7 5 6 5 4 0 4 7 8 2 7
Huang Wei ........................ (ii) 670 65 40 47 822
Kang Heng ........................ (iii) 413 65 40 47 565
Li Xiaohan ........................ (iv) 533 65 40 47 685
Liu Shengping ..................... ( v ) 1,080 65 40 47 1,232
Li Peng ........................... (vi) 1,047 65 40 47 1,199
Non-executive directors
Kuang Ziping ...................... (vii) — — — — —
Zhou Jiong ........................ (viii) — — — — —
Li Zhichao ........................ (ix) — — — — —
Wang Cunfu ....................... ( x ) — — — — —
Liang Xiaodong .................... (xi) — — — — —
Ma Jingxian ....................... (xii) — — — — —
Wang Yazhuo ..................... (xiv) — — — — —
Hu Jianjun ........................ (xv) 147 — — — 147
Fan Jian .......................... (xvi) 147 — — — 147
Jin Huihua ........................ (xvii) 104 — — — 104
Zhang Kun ........................ (xviii) 104 — — — 104
Chen Hua ......................... (xix) 104 — — — 104
Supervisor
Shan Bo .......................... (xxiii) 748 65 40 47 900
R e nH e ........................... (xxiv) 645 65 40 47 797
Hong Zhao ........................ (xxv) — — — — —
6,417 520 320 376 7,633
I-86


--- page 471 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
41 Benefits and interests of directors (continued)
(a) Directors’ emoluments (continued)
Note
Wages,
salaries
and
bonuses
Pension costs
- defined
contribution
plans
Other
social
security
costs
Housing
benefits Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
For the Year ended December 31, 2024
Executive directors
Liang Jia’en ....................... ( i ) 6 7 4 6 8 4 2 5 0 8 3 4
Huang Wei ........................ (ii) 1,200 68 42 50 1,360
Kang Heng ........................ (iii) 413 67 42 49 571
Li Xiaohan ........................ (iv) 538 68 42 50 698
Liu Shengping ..................... ( v ) 1,082 68 42 50 1,242
Li Peng ........................... (vi) 1,044 68 42 50 1,204
Non-executive directors
Kuang Ziping ...................... (vii) — — — — —
Li Zhichao ........................ (ix) — — — — —
Wang Cunfu ....................... ( x ) — — — — —
Wang Yazhuo ..................... (xiv) — — — — —
Hu Jianjun ........................ (xv) 200 — — — 200
Fan Jian .......................... (xvi) 200 — — — 200
Jin Huihua ........................ (xvii) 200 — — — 200
Zhang Kun ........................ (xviii) 200 — — — 200
Chen Hua ......................... (xix) 200 — — — 200
Supervisor
Shan Bo .......................... (xxiii) 763 68 42 50 923
R e nH e ........................... (xxiv) 665 68 42 50 825
Hong Zhao ........................ (xxv) — — — — —
7,379 543 336 399 8,657
(i) Mr. Liang Jia’en was appointed as a director with effect from June 10, 2019.
(ii) Mr. Huang Wei was appointed as a director with effect from June 10, 2019.
(iii) Mr. Kang Heng was appointed as a director with effect from June 10, 2019.
(iv) Mr. Li Xiaohan was appointed as a director with effect from June 10, 2019.
(v) Mr. Liu Shengping was appointed as a director with effect from June 10, 2019.
(vi) Mr. Li Peng was appointed as a director with effect from June 10, 2019.
(vii) Mr Kuang Ziping was appointed as a director with effect from June 10, 2019.
(viii) Zhou Jiong was appointed as a director with effect from June 10, 2019 and resigned on
December 20, 2023.
(ix) Li Zhichao was appointed as a director with effect from June 10, 2019.
(x) Wang Cunfu was appointed as a director with effect from April 12, 2023.
(xi) Liang Xiaodong was appointed as a director with effect from May 15, 2021 and resigned on
June 8, 2023.
I-87


--- page 472 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
41 Benefits and interests of directors (continued)
(a) Directors’ emoluments (continued)
(xii) Ma Jingxian was appointed as a director with effect from March 2021 and resigned on April 12,
2023.
(xiii) Li Xiaoqiang was appointed as a director with effect from June 10, 2019 and resigned on
March 29, 2021.
(xiv) Wang Yazhuo was appointed as a director with effect from December 20, 2023 and resigned on
December 31, 2024 and Li Ang was appointed as a director with effect from March 12, 2025.
(xv) Hu Jianjun was appointed as a director with effect from June 10, 2019.
(xvi) Fan Jian was appointed as a director with effect from June 10, 2019.
(xvii) Jin Huihua was appointed as a director with effect from June 23, 2023.
(xviii) Zhang Kun was appointed as a director with effect from June 23, 2023.
(xix) Chen Hua was appointed as a director with effect from June 23, 2023.
(xx) Liu Ming was appointed as a director with effect from June 10, 2019 and resigned on March
29, 2021.
(xxi) Zhao Hongfei was appointed as a director with effect from June 10, 2019 and resigned on
January 25, 2022.
(xxii) Tu Lingce was appointed as a director with effect from June 10, 2019 and resigned on
December 31, 2021.
(xxiii) Shan Bo was appointed as a director with effect from June 10, 2019.
(xxiv) Ren He was appointed as a director with effect from June 10, 2019.
(xxv) Hong Zhao was appointed as a director with effect from June 10, 2019.
(b) Directors’ retirement and termination benefits
No retirement or termination benefits have been paid to the Company’s directors for the years
ended December 31, 2022, 2023 and 2024.
(c) Consideration provided to third parties for making available directors’ services
No consideration was provided to third parties for making available directors’ services during
the years ended December 31, 2022, 2023 and 2024.
(d) Information about loans, quasi-loans or other dealings in favor of directors, controlled bodies
corporate by and connected entities with such directors
No loans, quasi-loans or other dealings were entered into by the Company in favor of directors,
controlled bodies corporate by and connected entities with such directors during the years ended
December 31, 2022, 2023 and 2024.
I-88


--- page 473 ---
APPENDIX I ACCOUNTANT’S REPORT
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION (Continued)
41 Benefits and interests of directors (continued)
(e) Directors’ material interests in transactions, arrangements or contracts
No significant transactions, arrangements and contracts in relation to the Group’s business to
which the Group was a party and in which a director of the Company had a material interest, whether
directly or indirectly, subsisted at the end of the years or at any time during the years ended
December 31, 2022, 2023 and 2024.
42 Contingencies
The Group did not have any material contingent liabilities as at December 31, 2024.
43 Dividend
No dividend has been paid or declared by the Company or the companies now comprising the
Group during each of the years ended December 31, 2022, 2023 and 2024.
III. SUBSEQUENT EVENTS
No audited financial statements have been prepared by the Company or any companies now
comprising the Group in respect of any period subsequent to December 31, 2024 and up to the date of
this report.
I-89


--- page 474 ---
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
The information set out in this Appendix does not form part of the “Accountant’s Report” from
PricewaterhouseCoopers, Certified Public Accountants, Hong Kong, the reporting accountant of the
Company, as set out in Appendix I in 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” and “Appendix I – Accountant’s Report.”
A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED NET TANGIBLE ASSETS
The following is an illustrative statement of the unaudited pro forma adjusted consolidated net
tangible assets which has been prepared in accordance with Rule 4.29 of the Listing Rules for the
purpose of illustrating the effect of the Global Offering as if it had taken place on December 31, 2024
and based on the consolidated net tangible liabilities attributable to the owners of the Company as at
December 31, 2024 as shown in the Accountant’s Report, the text of which is set out in Appendix I to
this prospectus, and adjusted as described below.
This unaudited pro forma adjusted consolidated net tangible assets has been prepared for
illustrative purposes only and, because of its hypothetical nature, it may not give a true picture of the
financial position of the Group had the Global Offering been completed as at December 31, 2024 or at
any future date.
Unadjusted
audited
consolidated
net tangible
liabilities
attributable to
the owners of the
Company as at
December 31, 2024
Estimated net
proceeds from
the Global
Offering
Estimated
impact
related to the
derecognition
of redemption
liabilities
upon Global
Offering
Unaudited
pro forma
adjusted
consolidated
net tangible
assets
attributable
to the owners
of the Company
Unaudited pro
forma adjusted
consolidated
net tangible
assets per
share
Note 1 Note 2 Note 3 Note 4
RMB’000 RMB’000 RMB’000 RMB’000 RMB HK$
Based on the Offer Price of
HK$165 per share ............ (2,742,579) 198,145 3,303,051 758,617 10.69 11.68
Based on the Offer Price of
HK$205 per share ............ (2,742,579) 252,780 3,303,051 813,252 11.46 12.52
Notes:
(1) The audited consolidated net tangible liabilities attributable to the owners of the Company as at December 31, 2024 is extracted from the
Accountant’s Report set forth in Appendix I to the prospectus, which is based on the audited consolidated net liabilities attributable to the
owners of the Company as at December 31, 2024 of RMB2,733,788,000 with an adjustment for the intangible assets as at December 31,
2024 of RMB8,791,000.
(2) The estimated net proceeds from the Global Offering are based on the indicative Offer Price of HK$165 and HK$205 per share after
deduction of the estimated underwriting fees and other related expenses payable by the Company (excluding RMB63,802,000 which had
been charged to the consolidated statements of comprehensive income up to December 31, 2024), without taking into account any shares
which may be issued upon the exercise of the Over-allotment Option.
(3) As described in note 30(i) of the Accountant’s Report set forth in Appendix I to the prospectus, the preferred rights granted to all
investors shall be irretrievably terminated upon the Listing and completion of the Global Offering. Accordingly, the carrying amount of
the related redemption liabilities of RMB3,303,051,000, would be derecognized and credited to the equity attributed to the owners of the
Company as at December 31, 2024.
(4) The unaudited pro forma adjusted consolidated net tangible assets per share are determined after the adjustments as described in notes (2)
and (3) above and on the basis that 70,953,453 shares are in issue, assuming the Global Offering had been completed on December 31,
2024, without taking into account any shares which may fall to be issued upon the exercise of the Over-Allotment Option.
(5) For the purpose of this unaudited pro forma adjusted net tangible assets, the balance stated in Renminbi is converted into Hong Kong
dollars at a rate of HK$1.00 to RMB0.91537. 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 adjustments have been made to the unaudited pro forma adjusted consolidated net tangible assets to reflect any trading results or
other transactions of the Group entered into subsequent to December 31, 2024.
II-1


--- page 475 ---
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
B. REPORT FROM THE REPORTING ACCOUNTANT ON UNAUDITED PRO FORMA
FINANCIAL INFORMATION
The following is the text of a report received from PricewaterhouseCoopers, Certified Public
Accountants, Hong Kong, for the purpose of incorporation in this prospectus.
INDEPENDENT REPORTING ACCOUNTANT’S ASSURANCE REPORT ON THE
COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION
To the Directors of Unisound AI Technology Co., Ltd.
We have completed our assurance engagement to report on the compilation of unaudited pro
forma financial information of Unisound AI Technology Co., Ltd. (the “Company”) and its
subsidiaries (together, the “Group”) by the directors of the Company (the “Directors”) for illustrative
purposes only. The unaudited pro forma financial information consists of the unaudited pro forma
statement of adjusted consolidated net tangible assets of the Group as at December 31, 2024 and
related notes (the “Unaudited Pro Forma Financial Information”) as set out on page II-1 of the
Company’s prospectus dated June 20, 2025 (the “Prospectus”), in connection with the proposed initial
public offering of the shares of the Company (the “Proposed Initial Public Offering”). The applicable
criteria on the basis of which the Directors have compiled the Unaudited Pro Forma Financial
Information are described on page II-1 of the Prospectus.
The Unaudited Pro Forma Financial Information has been compiled by the Directors to
illustrate the impact of the Proposed Initial Public Offering on the Group’s financial position as at
December 31, 2024 as if the Proposed Initial Public Offering had taken place at December 31, 2024.
As part of this process, information about the Group’s financial position has been extracted by the
Directors from the Group’s financial information for the period ended December 31, 2024, on which
an accountant’s report has been published.
Directors’ Responsibility for the Unaudited Pro Forma Financial Information
The Directors are responsible for compiling the Unaudited Pro Forma Financial Information in
accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (the “Listing Rules”) and with reference to Accounting Guideline 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”).
Our Independence and Quality Management
We have complied with the independence and other ethical requirements of the Code of Ethics
for Professional Accountants issued by the HKICPA, which is founded on fundamental principles of
integrity, objectivity, professional competence and due care, confidentiality and professional behavior.
Our firm applies Hong Kong Standard on Quality Management (HKSQM) 1, Quality
Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or
Related Services Engagements, issued by the HKICPA , which requires the firm to design, implement
and operate a system of quality management including policies or procedures regarding compliance
with ethical requirements, professional standards and applicable legal and regulatory requirements.
II-2


--- page 476 ---
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
Reporting Accountant’s 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
accountant plans and performs procedures to obtain reasonable assurance about whether the Directors
have compiled the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of
the Listing Rules and with reference to AG 7 issued by the HKICPA.
For purposes of this engagement, we are not responsible for updating or reissuing any reports or
opinions on any historical financial information used in compiling the Unaudited Pro Forma Financial
Information, nor have we, in the course of this engagement, performed an audit or review of the
financial information used in compiling the Unaudited Pro Forma Financial Information.
The purpose of unaudited pro forma financial information included in a prospectus is solely to
illustrate the impact of a significant event or transaction on unadjusted financial information of the
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 Initial Public Offering at December 31, 2024 would have been as presented.
A reasonable assurance engagement to report on whether the unaudited pro forma financial
information has been properly compiled on the basis of the applicable criteria involves performing
procedures to assess whether the applicable criteria used by the directors in the compilation of the
unaudited pro forma financial information provide a reasonable basis for presenting the significant
effects directly attributable to the event or transaction, and to obtain sufficient appropriate evidence
about whether:
Š The related pro forma adjustments give appropriate effect to those criteria; and
Š 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 accountant’s judgment, having regard to the
reporting accountant’s understanding of the nature of the company, 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.
Our work has not been carried out in accordance with auditing standards or other standards and
practices generally accepted in the United States of America or auditing standards of the Public
II-3


--- page 477 ---
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
Company Accounting Oversight Board (United States) or standards and practices of any professional
body in any other overseas jurisdiction and accordingly should not be relied upon as if it had been
carried out in accordance with those standards and practices.
Opinion
In our opinion:
(a) the Unaudited Pro Forma Financial Information has been properly compiled by the
Directors on the basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purposes of the Unaudited Pro Forma Financial
Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.
PricewaterhouseCoopers
Certified Public Accountants
Hong Kong, June 20, 2025
II-4


--- page 478 ---
APPENDIX III TAXATION AND FOREIGN EXCHANGE
TAXATION IN THE PRC
Taxation of Security Holders
The taxation of income and capital gains of holders of H Shares is subject to the laws and practices of
the PRC and of jurisdictions in which holders of H Shares are resident or otherwise subject to tax. The
following summary of certain relevant taxation provisions is based on current laws and practices in
effect, and constitutes no predictions of changes or adjustments to relevant laws or policies or any
advice or suggestions thereunder. The discussion does not deal with all possible tax consequences
relating to an investment in the H Shares or take into account the specific circumstances of any
particular investor, some of which may be subject to special rules. Accordingly, investors should
consult their own tax adviser regarding the taxation of an investment in the H Shares. The discussion is
based upon current laws and relevant interpretations in effect as at the execution date of this document,
all of which are subject to change or adjustment and may be different from our past practice.
The discussion below does not involve any issue concerning the PRC or Hong Kong taxation other
than income tax, capital gains tax, stamp duty and estate duty. Prospective investors are urged to
consult their financial advisers regarding the PRC, Hong Kong and other tax consequences of owning
and disposing of H Shares.
Taxation on Dividends
Individual Investors
Pursuant to the Individual Income Tax Law of the PRC (
) last
amended on August 31, 2018 and implemented on January 1, 2019 as well as the Regulations on
Implementation of the Individual Income Tax Law of the PRC (
ૢ
Է) last amended on December 18, 2018 and implemented on January 1, 2019, dividends distributed
by PRC enterprises are subject to an 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 an applicable tax treaty. In accordance with the Circular on Certain
Issues Concerning the Policies of Individual Income Tax (Cai Shui Zi [1994] No.020) (
੻
(ৌ೼ο[1994]020໮)) promulgated by the Ministry of Finance (“ MOF”) and
the State Administration of Taxation (the “ SAT”) on May 13, 1994 and effective from the same day,
overseas individuals are, as an interim measure, exempted from the individual income tax for dividends
or bonuses received from foreign-invested enterprises. According to the Notice of the State Council on
Approving and Relaying the Several Opinions of the National Development and Reform Commission
and Other Departments on Deepening Reform of the Income Distribution System (
ҷ
) issued by the State Council on February 5,
2013, overseas individuals are no longer exempted from the individual income tax for dividends or
bonuses received from foreign-invested enterprises, which is, however, not specified in the subsequent
Individual Income Tax Law of the PRC and relevant tax regulations.
On June 28, 2011, the SAT issued the Notice on Matters Concerning the Levy and Administration of
Individual Income Tax After the Repeal of Document Guo Shui Fa [1993] No. 045 (Guo Shui Han
[2011] No. 348) (
਷೼೯[1993]045(਷೼
Ռ[2011]348໮)), pursuant to which, dividends received by overseas resident individual shareholders
from domestic non-foreign invested enterprises which have issued shares in Hong Kong are subject to
III-1


--- page 479 ---
APPENDIX III TAXATION AND FOREIGN EXCHANGE
individual income tax, which shall be withheld and paid by a withholding agent according to the items
of interest, dividend and bonus income. Overseas resident individual shareholders of domestic
non-foreign invested enterprises which have issued shares in Hong Kong are entitled to relevant
preferential tax treatment pursuant to the provisions in the tax treaties between the countries in which
they are residents and China, and the tax arrangements between Mainland China and Hong Kong
(Macau). Individual shareholders are generally subject to a withholding tax rate of 10% without any
application when domestic non-foreign invested enterprises which have issued shares in Hong Kong
distribute dividends. Where the tax rates on dividends are not 10%, the following requirements shall
apply: (1) for individuals receiving dividends who are citizens from countries that have entered into tax
treaties with China with tax rates lower than 10%, they may, according to the Notice of SAT on Issuing
the Administrative Measures on Preferential Treatment Entitled by Non-residents under Tax Treaties
(Guo Shui Fa [2009] No.124) (
ʮѓ
(਷೼೯[2009]124໮)), apply for refund; (2) for individuals receiving dividends who are citizens
from countries that have entered into tax treaties with China with tax rates higher than 10% but lower
than 20%, the withholding agent will, upon distribution of dividends, withhold and pay the individual
income tax at the agreed effective tax rates under the treaties, without seeking such approval; (3) for
individuals receiving dividends who are citizens from countries without tax treaties with China or
under other circumstances, the withholding agent will, upon distribution of dividends, withhold and
pay the individual income tax at the rate of 20%.
In accordance with the Arrangement between the Mainland of China and the Hong Kong Special
Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion
with respect to Taxes on Income (
τ
ર) signed on August 21, 2006, the PRC Government may levy taxes on the dividends paid by a PRC
company to Hong Kong residents (including natural persons and legal entities) in an amount not
exceeding 10% of total dividends payable by the PRC company. If a Hong Kong resident directly
holds 25% or more of the equity interest in a PRC company, then such tax shall not exceed 5% of the
dividends payable by the PRC company.
Enterprise Investors
In accordance with the Enterprise Income Tax Law of the PRC (
) (the
“EIT Law ”), which was latest amended and came into effect on December 29, 2018, and Regulations
for the Implementation of the Enterprise Income Tax Law of the PRC (ج
ૢԷ), which was latest amended on December 6, 2024 and came into effect on January 20,
2025, 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 that issues shares in Hong Kong),
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 connected with such
establishment or place in the PRC. The aforesaid income tax may be reduced pursuant to applicable
treaties to avoid double taxation. Such withholding tax for non-resident enterprises are deducted at
source, where the payer of the income are required to withhold the income tax from the amount to be
paid to the non-resident enterprise when such payment is made or due.
The SAT 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) (
͏ΆุΣྤ̮Hٰ
(਷೼Ռ [2008]897໮)) issued by the SAT on November 6,
III-2


--- page 480 ---
APPENDIX III TAXATION AND FOREIGN EXCHANGE
2008, which became effective on the same day, further clarified that a PRC-resident enterprise must
withhold corporate income tax at a flat rate of 10% on dividends paid to non-PRC resident enterprise
shareholders of H Shares with respect to the dividends of 2008 and onwards. In addition, the SAT
Response to Questions on Levying Enterprise Income Tax on Dividends Derived by Non-resident
Enterprises from Holding Stocks such as B Shares (Guo Shui Han [2009] No.394) (
೼ਕᐼ҅ᗫ
͏Άุ՟੻Bҭᔧ(਷೼Ռ[2009]394໮)) issued by the SAT
on July 24, 2009, which became effective on the same day, further provides that PRC-resident
enterprises listed on Chinese and overseas stock exchanges by issuing stocks (A shares, B shares and
overseas shares) must withhold enterprise income tax at a flat 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 treaties or agreements that China has concluded with a relevant
jurisdiction, where applicable.
Pursuant to the Arrangement between the Mainland and the Hong Kong Special Administrative Region
for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on
Income (
τર) signed on
August 21, 2006, the PRC Government may levy taxes on the dividends paid by a PRC company to
Hong Kong residents (including natural persons and legal entities) in an amount not exceeding 10% of
total dividends payable by the PRC company. If a Hong Kong resident directly holds 25% or more of
the equity interest in a PRC company, then such tax shall not exceed 5% of the dividends payable by
the PRC company.
Tax Treaties
Investors who are not PRC residents and reside in jurisdictions which have entered into avoidance of
double taxation treaties or arrangements with the PRC are entitled to a reduction of the PRC enterprise
income taxes imposed on the dividends received from PRC companies. At present, the PRC has
entered into agreements/arrangements for the avoidance of double taxation with a number of countries
or regions including HKSAR, Macau S.A.R, 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
may apply to the PRC tax authorities for a refund of enterprise income tax in excess of the agreed tax
rate, and the refund application is subject to approval by the PRC tax authorities.
Taxation on Share Transfer
Income Tax
Individual Investors
According to the Individual Income Tax Law of the PRC, gains realized on the transfer of personal
assets are subject to the income tax at a rate of 20%. Under the Circular on the Continued Exemption
of Individual Income Tax over Individual Income from Share Transfer by the MOF and the SAT (Cai
Shui Zi [1998] No.61) (
(ৌ೼ο [1998]61໮))
jointly issued by the MOF and the SAT on March 30, 1998, which became effective on the same day,
from January 1, 1997, gains of individuals from the transfer of shares of listed enterprises continues to
be exempted from individual income tax. According to the Individual Income Tax Law (last amended
and implemented on January 1, 2019) and its implementing regulations, the SAT has not explicitly
stated whether it will continue to exempt individual income tax on gains from the transfer of shares of
listed companies.
III-3


--- page 481 ---
APPENDIX III TAXATION AND FOREIGN EXCHANGE
However, on December 31, 2009, the MOF, the SAT and the CSRC jointly issued the Circular on
Relevant Issues Concerning the Collection of Individual Income Tax over the Income Received by
Individuals from Transfer of Listed Shares Subject to Sales Limitation (Cai Shui [2009] No.167) (
ᗫ
(ৌ೼[2009]167໮)), which became
effective on January 1, 2010 and provides that individuals’ income from transferring listed shares
publicly issued and transferred on the Shanghai Stock Exchange and the Shenzhen Stock Exchange
shall continue to be exempted from individual income tax, except for shares subject to sales limitations
as defined in the Supplementary Circular on Relevant Issues Concerning the Collection of Individual
Income Tax over the Income Received by Individuals from Transfer of Listed Shares Subject to Sales
Limitation (Cai Shui [2010] No.70) (
໾
(ৌ೼[2010]70໮)) jointly issued by such departments on November 10, 2010 and coming into
effect on the same day.
As of the execution date of this document, no provision has expressly provided that individual income tax
shall be collected from non-PRC resident individual shareholders on their gains from the transfer of shares
of PRC resident enterprises listed on overseas stock exchanges (such as the Hong Kong Stock Exchange).
Enterprise Investors
In accordance with the EIT Law as well as the Regulations for the Implementation of the Enterprise
Income Tax Law of the PRC (
ૢԷ) last amended on
December 6, 2024 and came into effect on January 20, 2025, a non-resident enterprise is generally
subject to a flat 10% enterprise income tax on PRC-sourced income, if it 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 connected with such establishment or place. Such income 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 when such payment is made or due. The tax may be
reduced pursuant to special arrangements or agreements entered into between the PRC and
jurisdictions where the non-resident enterprise operates.
Stamp Duty
Under the Stamp Tax Law of the PRC (
) issued by the SCNPC on
June 10, 2021 and implemented on July 1, 2022, the PRC stamp tax is applicable to the entities and
individuals that conclude taxable vouchers or conduct securities trading within the territory of the PRC,
and the entities and individuals outside the territory of the PRC that conclude taxable vouchers that are
used inside China. Therefore, PRC stamp duty on share transfer by PRC listed companies does not
apply to acquisitions or dispositions of H shares outside the PRC by non-PRC investors.
Estate Duty
As of the execution date of this document, no estate duty has been levied in China under the PRC laws.
Taxation Policy of Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock
Connect
On October 31, 2014 and November 5, 2016, the MOF, the SAT and the CSRC jointly issued the
Notice on Taxation Policies Concerning the Pilot Program of an Interconnection Mechanism for
III-4


--- page 482 ---
APPENDIX III TAXATION AND FOREIGN EXCHANGE
Transactions in the Shanghai and Hong Kong Stock Markets (Cai Shui [2014] No.81) (ୃ
(ৌ೼[2014]81໮)) and the Notice on Tax Policies
Concerning the Pilot Program of an Interconnection Mechanism for Transactions in the Shenzhen and
Hong Kong Stock Markets (Cai Shui [2016] No.127) (
ʝᑌʝஷዚՓ༊ᓃϞᗫ
(ৌ೼[2016]127໮)), pursuant to which, the income from transfer differences and
dividend and bonus income derived by PRC enterprise investors from investing in stocks listed on the
Hong Kong Stock Exchange through Shanghai-Hong Kong Stock Connect or Shenzhen-Hong Kong
Stock Connect shall be included in their total income and subject to enterprise income tax in
accordance with the law. In particular, the dividend and bonus income derived by PRC resident
enterprises which hold H shares for at least 12 consecutive months shall be exempted from enterprise
income tax according to law. H-share companies do not withhold tax on dividends and bonus income
of PRC enterprise investors, and the tax payable shall be declared and paid by enterprises.
For dividends and bonuses received by PRC individual investors investing in H shares listed on the
Hong Kong Stock Exchange through Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong
Stock Connect, H-share companies shall submit an application to China Securities Depository and
Clearing Corporation Limited, which shall provide H-share companies with a register of PRC
individual investors. H-share companies shall withhold individual income tax at a rate of 20%.
Individual investors who have paid withholding tax outside the PRC may apply for tax credits at the
competent tax authorities of the CSDC with valid tax deduction certificates. Individual income tax is
levied on dividend and bonus income derived by PRC security investment funds from investing in
stocks listed on the Hong Kong Stock Exchange through Shanghai-Hong Kong Stock Connect and
Shenzhen-Hong Kong Stock Connect in accordance with the above provisions.
On December 4, 2019, the MOF, the SAT and the CSRC jointly issued the Announcement on the
Continued Implementation of the Individual Income Tax Policies on the Interconnection Mechanisms
for Transactions in Shanghai and Hong Kong Stock Markets and for Transactions in Shenzhen and
Hong Kong Stock Markets (MOF Announcement 2019 No.93) (
ୃ̹ఙʹ
ʮѓ(௅ʮѓ2019ϋୋ93໮)). It
stipulates that for PRC individual investors, the transfer difference income derived from investing in
stocks listed on the Hong Kong Stock Exchange through Shanghai-Hong Kong Stock Connect and
Shenzhen-Hong Kong Stock Connect and the trading of Hong Kong fund units through mutual
recognition of funds will continue to be exempt from individual income tax on a temporary basis from
December 5, 2019 to December 31, 2022.
In addition, pursuant to the Announcement on the Extension of the Implementation of the Individual
Income Tax Policies on the Interconnection Mechanisms for Transactions in Shanghai and Hong Kong
Stock Markets and for Transactions in Shenzhen and Hong Kong Stock Markets (MOF Announcement
2023 No.23) (
ה
ʮѓ(௅ʮѓ2023 ϋୋ23 ໮)) jointly issued by the MOF, the SAT and the CSRC on
August 21, 2023, the implementation period of the individual income tax exemptions further extends to
December 31, 2027.
PRINCIPAL TAXATION OF THE COMPANY IN THE PRC
Enterprise Income Tax
According to the EIT Law, a resident enterprise shall pay EIT on its income originating from both
inside and outside the PRC at an EIT rate of 25%. Foreign invested enterprises in the PRC falls into the
category of resident enterprises, which shall pay EIT for the income originated from domestic and
overseas sources at an EIT rate of 25%.
III-5


--- page 483 ---
APPENDIX III TAXATION AND FOREIGN EXCHANGE
Value-added Tax
According to the Provisional Regulations of the PRC on Value-added Tax (೼ᅲ
БૢԷ) (the “ Regulations on VAT ”), which was promulgated by the State Council on
December 13, 1993 and latest amended on November 19, 2017, and the Detailed Rules for the
Implementation of the Provisional Regulations of the PRC on Value-added Tax (
࠽
), which was promulgated by the MOF, came into effect on December 25, 1993
and latest amended on October 28, 2011, all the taxpayers engaged in sales of goods or provision of
processing, repair and maintenance labor or import of goods in China shall be subject to value-added
tax. Unless specified by the Regulations on VAT, for the sales or import of goods by general
taxpayers, the VAT rate shall be 17%; for provision of processing, repair and maintenance labor by
taxpayers, the VAT rate shall be 17%; for export of goods by taxpayers, the VAT rate shall be nil,
unless otherwise provided.
Pursuant to Notice on Implementing the Pilot Reform for Transition from Business Tax to Value-added
Tax Nationwide (Cai Shui [2016] No. 36) issued by the MOF and SAT (
પකᐄุ೼ҷᅄᄣ
)( ৌ೼[2016]36໮) promulgated on March 23, 2016, the pilot reform for the
transition from business tax to VAT is implemented nationwide, and the financial industry is included
in such pilot and is required to pay VAT instead of business tax. Pursuant to the Implementation
Measures for Transition from Business Tax to Value-added Tax (
),
unless otherwise provided in the implementation measures.
According to the Circular of the Ministry of Finance and the State Taxation Administration on
Adjusting Value-added Tax Rates (), which was
issued on April 4, 2018 and came into effect on May 1, 2018, where a tax payer engages in a taxable
sales activity for the value-added tax purpose or imports goods, the previous applicable reduced 17%
and 11% tax rates are adjusted to be 16% and 10%, respectively. According to the Announcement of
the Ministry of Finance, the State Taxation Administration and the General Administration of
Customers on Deepening Policies in relation to Value-added Tax Reform (
௅e೼ਕᐼ҅ʿऎᗫ
ʮѓ) which was promulgated on March 20, 2019 and became
effective on April 1, 2019, the VAT rates are reduced to 13% and 9%, respectively.
On December 25, 2024, the SCNPC published the PRC Value-Added Tax Law (࠽
), which will come into effect on January 1, 2026, replacing the Provisional Regulations of the
PRC on Value-Added Tax. The new law reaffirms the provisions of the Provisional Regulations of the
PRC on Value-Added Tax and make changes in the areas of taxable acts, tax jurisdiction, deemed
sales, non-taxable items, simplified taxation, withholding agents, input taxes, non-creditable input
taxes, mixed sales, and input credit carry-forward and refund.
FOREIGN EXCHANGE POLICIES OF THE PRC
Renminbi is the legal currency of the PRC and is currently subject to foreign exchange regulatory
procedures and cannot be freely inverted into foreign currency. The State Administration of Foreign
Exchange (“SAFE”) under the People’s Bank of China is responsible for all matters relating to foreign
exchange, including the enforcement of foreign exchange regulations.
Under the Foreign Exchange Administration Regulation of the PRC (
ʕശɛ͏΍ձ਷̮ි၍ଣૢ
Է) issued by the State Council on January 29, 1996 and effective from April 1, 1996, all
III-6


--- page 484 ---
APPENDIX III TAXATION AND FOREIGN EXCHANGE
international payments and transfers are classified into current items and capital items. Approval by the
foreign exchange authorities is not required for most current items, but required for capital items.
According to the Foreign Exchange Administration Regulation of the PRC amended on January 14,
1997 and August 1, 2008, the state does not impose restrictions on current international payments and
transfers.
Under the Administrative Regulations on Foreign Exchange Settlement, Sale and Payment (
ഐිeਯ
) issued by the People’s Bank of China on June 20, 1996 and implemented from
July 1, 1996, the existing restrictions on foreign exchange transactions under capital items are retained,
while the remaining restrictions on foreign exchange conversion for current items are abolished.
According to the Announcement on Reforming the Renminbi Exchange Rate Regime (
ҁഛɛ͏
ʮѓ) issued by the People’s Bank of China on July 21, 2005 and effective
from the same date, from July 21, 2005 onwards, China has implemented a floating exchange rate
system with management and regulation based on market supply and demand and with reference to a
basket of currencies. As a result, Renminbi exchange rates are no longer pegged to USD. The People’s
Bank of China publishes the closing prices of the exchange rates of Renminbi against USD and other
currencies in the interbank foreign exchange market after the market closes on each working day,
which serves as the mid-price for the currency’s transactions against Renminbi on the following
working day.
On August 5, 2008, the State Council promulgated the amended Foreign Exchange Administration
Regulation of the PRC, with significant changes to China’s foreign exchange regulatory system.
Firstly, balanced treatment has been adopted for foreign exchange inflows and outflows. Foreign
exchange earnings from overseas may be transferred back to the PRC or deposited abroad, and
foreign exchange and settlement funds under capital items may only be used for the purposes
approved by competent authorities and foreign exchange control authorities. Secondly, it has
improved the Renminbi exchange rate formation mechanism based on market supply and demand.
Thirdly, when there is or appears to be a serious imbalance in international balance of payments or
when there is or appears to be a serious crisis in the national economy, the state can take necessary
safeguard and regulatory measures on international balance of payments. Fourthly, it has
strengthened the supervision and management of foreign exchange transactions and granted
extensive powers to the SAFE to enhance its supervision and management capabilities.
According to relevant PRC laws and regulations, Chinese enterprises (including foreign-invested
enterprises) requiring foreign exchange for current account transactions may, without the approval of
foreign exchange authorities, make payments through foreign exchange accounts opened at designated
foreign exchange banks, provided that valid receipts or vouchers for the transactions are produced.
Foreign-invested enterprises that need to distribute profits in foreign currency to their shareholders and
Chinese enterprises that need to pay dividends in foreign currency to their shareholders may make
payments from foreign exchange accounts at designated foreign exchange banks or exchange and pay
at such banks in accordance with the decision of the board of directors or the shareholders’ general
meeting on the distribution of profits.
Pursuant to the Decision of the State Council on Canceling and Adjusting a Range of Administrative
Approval Items and Other Matters (Guo Fa [2014] No.50) (
ᄲҭ
(਷೯[2014]50໮)) issued by the State Council on October 23, 2014 and effective
III-7


--- page 485 ---
APPENDIX III TAXATION AND FOREIGN EXCHANGE
from the same date, the requirement has been canceled for the SAFE and its branches to approve the
repatriation and settlement of foreign exchange proceeds raised by overseas listed foreign shares.
According to the Notice of the State Administration of Foreign Exchange on Issues concerning the
Foreign Exchange Administration Involved in Overseas Listing (Hui Fa [2014] No.54) (̮ි၍
(ි೯[2014]54໮)) issued by the SAFE on December 26,
2014 and effective from the same date, a domestic company shall register its overseas listing with the
local branch of the State Administration of Foreign Exchange within 15 working days from the date of
completion of overseas listing. Funds raised by a domestic company from overseas listing may be
transferred back or deposited overseas, and the use of the funds shall be consistent with those set out in
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໮))
issued by the SAFE on February 13, 2015, implemented from June 1, 2015 and amended on
December 30, 2019, two administrative approvals have been canceled, namely foreign exchange
registration under domestic direct investment and that under overseas direct investment, which will be
directly reviewed and approved by banks. The SAFE and its branches exercise indirect supervision
over the foreign exchange registration of direct investment through banks.
Pursuant to the Notice of the State Administration of Foreign Exchange on Reforming and Regulating
the Policies on the Control over Foreign Exchange Settlement of Capital Accounts (Hui Fa [2016]
No.16) (
(ි೯[2016]16໮)) issued by
the SAFE on June 9, 2016 and implemented from the same date, the relevant policies have explicitly
stated that the foreign exchange income from capital items (including foreign exchange capital funds,
foreign debt funds, funds transferred back from overseas listings, etc.) which are subject to voluntary
settlement can be settled at banks according to the particular needs of domestic institutions. The ratio
of voluntary settlement of foreign exchange earnings from capital items of domestic institutions is
temporarily set at 100%, which is subject to adjustment by the SAFE according to international balance
of payments.
According to the 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) (
ࣨ
(ි೯[2017]3໮)) issued by the SAFE on January 26, 2017 and implemented from the same
date, the scope of domestic foreign exchange loan settlement is further expanded to allow domestic
foreign exchange loans with the background of commodity trade and exports to be settled, allow funds
under domestic guarantee and foreign loans to be transferred back, allow foreign exchange settlement
via the foreign exchange accounts of foreign institutions in pilot free trade zones, and implement full-
coverage overseas lending management in both Renminbi and foreign currencies; where a domestic
institution engages in overseas lending, the combined balance of foreign exchange lending in
Renminbi and foreign currencies shall not exceed a maximum of 30% of the owner’s equity in the
audited financial statements of the preceding year.
According to the Notice on Further Facilitating Cross-border Trade and Investment (Hui Fa [2019]
No.28) (
(ි೯[2019]28໮)) issued by the SAFE on
III-8


--- page 486 ---
APPENDIX III TAXATION AND FOREIGN EXCHANGE
October 23, 2019 and implemented from the same date, restrictions have been removed on the use of
capital funds by non-investment foreign-invested enterprises for domestic equity investment. In
addition, restrictions have also been removed on the use of funds in domestic asset realization accounts
for foreign exchange settlement and the use of security deposits for foreign exchange settlement by
foreign investors. Eligible enterprises in pilot areas are allowed to use capital funds, foreign debt,
overseas listings and other income under capital items for domestic payments without providing the
banks with proofs of authenticity in advance, and their use of funds should be genuine and compliant
with the current regulations governing the use of income from capital items.
TAXATION IN HONG KONG
Tax on Dividends
Under the current practice of the Inland Revenue Department of Hong Kong, no tax is payable
in Hong Kong in respect of dividends paid by us.
Capital Gains and Profit Tax
No tax is imposed in Hong Kong in respect of capital gains from the sale of H Shares.
However, trading gains from the sale of the H Shares by persons carrying on a trade, profession or
business in Hong Kong, where such gains are derived from or arise in Hong Kong from such trade,
profession or business will be subject to Hong Kong profits tax, which is currently imposed at the
maximum rate of 16.5% on corporations and at the maximum rate of 15% on unincorporated
businesses. Certain categories of taxpayers (for example, financial institutions, insurance companies
and securities dealers) are likely to be regarded as deriving trading gains rather than capital gains
unless these taxpayers can prove that the investment securities are held for long-term investment
purposes. Trading gains from sales of H Shares effected on the Hong Kong Stock Exchange will be
considered to be derived from or arise in Hong Kong. Liability for Hong Kong profits tax would thus
arise in respect of trading gains from sales of H Shares effected on the Hong Kong Stock Exchange
realized by persons carrying on a business of trading or dealing in securities in Hong Kong.
Stamp Duty
Hong Kong stamp duty, currently charged at the ad valorem rate of 0.13% on the higher of the
consideration for or the market value of the H Shares, will be payable by the purchaser on every
purchase and by the seller on every sale of Hong Kong securities, including H Shares (in other words,
a total of 0.26% is currently payable on a typical sale and purchase transaction involving H Shares). In
addition, a fixed duty of HK$5.00 is currently payable on any instrument of transfer of H Shares.
Where one of the parties is a resident outside Hong Kong and does not pay the ad valorem duty due by
it, the duty not paid will be assessed on the instrument of transfer (if any) and will be payable by the
transferee. If no stamp duty is paid on or before the due date, a penalty of up to ten times the duty
payable may be imposed.
Estate Duty
The Revenue (Abolition of Estate Duty) Ordinance 2005 came into effect on February 11, 2006
in Hong Kong, pursuant to which no Hong Kong estate duty is payable and no estate duty clearance
papers are needed for an application of a grant of representation in respect of holders of H Shares
whose deaths occur on or after February 11, 2006.
III-9


--- page 487 ---
IV-1
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
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 ministries of the State Council,
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 verdicts
do not constitute binding precedents. However, they may be used as judicial reference and guidance.
According to the Constitution and the Legislation Law of the PRC (
)
(the “Legislation Law”), the National People’s Congress (the “ NPC”) and the Standing Committee of
the National People’s Congress (the “SCNPC”) are empowered to exercise the legislative power of the
State. The NPC has the power to formulate and amend the basic laws governing civil and criminal
matters, state organs and other matters. The SCNPC is empowered to formulate and amend laws other
than those required to be enacted by the NPC. During the adjournment of the NPC, partial supplement
and amendment shall be made to the laws as formulated by the NPC, provided that such supplements
and amendments are not in conflict with the basic principles of such laws.
The State Council is the highest organ of the PRC administration and has the power to
formulate administrative regulations based on the Constitution and laws.
The people’s congresses of the provinces, autonomous regions and municipalities and their
respective standing committees may formulate local regulations based on the specific circumstances
and actual needs of their respective administrative areas. These local regulations shall comply with the
Constitution, laws and administrative regulations. The people’s congresses of cities divided into
districts and their respective standing committees may formulate local regulations on aspects such as
urban and rural construction and management, environmental protection, and historical and cultural
protection based on the specific circumstances and actual needs of such cities, provided that such local
regulations do not contravene any provisions of the Constitution, laws, administrative regulations and
local regulations of their respective provinces or autonomous regions. Where the laws provide
otherwise on the matters concerning the formulation of local regulations by cities divided into districts,
those provisions shall prevail. Such local regulations by cities divided into districts shall 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 the local regulations
submitted for approval. Such approval shall 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 divided
into 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 shall be made by the standing committees of
the people’s congresses of provinces or autonomous regions for resolution. The people’s congresses of
national autonomous areas shall have the power to formulate 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 People’s Bank of China, the National
Audit Office of the PRC and the subordinate institutions with administrative functions directly under


--- page 488 ---
IV-2
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
the State Council may formulate departmental rules within the jurisdiction of their respective departments
based on the laws and administrative regulations, as well as the decisions and orders of the State Council.
Provisions of departmental rules should be the matters related to the enforcement of the laws and
administrative regulations, and the decisions and orders of the State Council. The people’s governments
of the provinces, autonomous regions, municipalities and cities or autonomous prefectures divided into
districts may formulate their rules and regulations based on the laws, administrative regulations and local
regulations of relevant provinces, autonomous regions and municipalities.
The Constitution has supreme legal authority and no laws, administrative regulations, local
regulations, autonomous regulations or separate regulations may contravene the Constitution. The
authority of laws is greater than that of administrative regulations, local regulations and rules. The
authority of administrative regulations is greater than that of local regulations and rules. The authority
of local regulations is greater than that of the rules of the local governments at or below the
corresponding level. The authority of the rules enacted by the people’s governments of the provinces or
autonomous regions is greater than that of the rules enacted by the people’s governments of the cities
with districts and autonomous prefectures within the administrative areas of the provinces and the
autonomous regions.
The NPC has the power to alter or abrogate any inappropriate laws enacted by its standing
committee, and to abrogate any autonomous regulations and separate regulations as approved by its
standing committee which contravene the Constitution or the Legislation Law. The SCNPC has the
power to abrogate any administrative regulations that contravene the Constitution or laws, to abrogate
any local regulations that contravene the Constitution, laws or administrative regulations, and to
abrogate any autonomous regulations and local regulations which have been approved by the SCNPC
of the relevant provinces, autonomous regions or municipalities directly under the central government,
but contravene the Constitution or the Legislation Law. The State Council has the power to alter or
abrogate any inappropriate ministerial rules and rules of local governments. The people’s congresses of
provinces, autonomous regions or municipalities directly under the central government have the power
to alter or abrogate any inappropriate local regulations enacted or approved by their respective standing
committees. The people’s governments of provinces and autonomous regions have the power to alter
or abrogate any inappropriate rules enacted by the people’s governments at a lower level.
According to the Constitution and the Legislation Law, the power to interpret the laws is vested
in the SCNPC. According to the Resolution of the SCNPC Regarding the Strengthening of
Interpretation of Laws
Ӕᙄ passed on
June 10, 1981. If the scope prescribed by laws needs to be further defined or supplementary provisions
are needed, the SCNPC shall interpret them or make provisions. Issues involving the specific
application of laws in the trial work of the court shall be interpreted by the Supreme People’s Court.
Issues involving the specific application of laws in the procuratorial work of the procuratorate shall be
interpreted by the Supreme People’s Procuratorate. If there are principled differences in the
interpretation of the Supreme People’s Court and the Supreme People’s Procuratorate, they shall be
submitted to the SCNPC for interpretation or decision. Issues that do not involve the specific
application of laws in judicial and procuratorial work shall be interpreted by the State Council and the
competent departments. The State Council and its ministries and commissions are also vested with the
power to give interpretation of the administrative regulations and ministerial rules which they have
promulgated. At the regional level, the power to give interpretation of the local laws is vested in the
regional legislative and administrative organs which promulgate such law.


--- page 489 ---
IV-3
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
PRC JUDICIAL SYSTEM
Under the Constitution and the PRC Law on the Organization of the People’s Courts (2018
revision)2018, the PRC judicial system is made up
of the Supreme People’s Court, the local people’s courts at all levels, and the special people’s courts.
Local people’s courts are divided into primary people’s court, intermediate people’s court and
high people’s court. High people’s courts supervise the primary and intermediate people’s courts. The
people’s procuratorates also have the right to exercise legal supervision over the civil proceedings of
people’s courts of the same level and lower levels. The Supreme People’s Court is the highest judicial
organ in the PRC. It supervises the judicial work of the people’s courts at all levels.
A people’s court adopts the system in which the rule of the second instance as the final rule,
that is, the judgments or rulings of the second instance at a people’s court are final. A party 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, and judgments or rulings of the first instance of the Supreme
People’s Court are final. However, if any errors are identified in a legally effective judgment, ruling or
mediation statement of the people’s court at any level by the Supreme People’s Court, or if such errors
are identified in a legally effective judgment, ruling or mediation statement of the people’s court at a
lower level by the people’s court at a higher level, the Supreme People’s Court or the people’s court at
a higher level has the authority to review the case itself or to refer to the people’s court at a lower level
to conduct a retrial. If such errors are identified in a legally effective judgment, ruling or mediation
statement by the chief judge of all levels of the people’s courts, and they consider a retrial is preferred,
such case shall be submitted to the judicial committee of the people’s court at the same level for
discussion and decision.
The Civil Procedure Law of the PRC (
 ) (the “ Civil Procedure
Law”), which was last amended by the SCNPC on December 24, 2021 and became effective on
January 1, 2022, prescribes the conditions for instituting a civil action, the jurisdiction of a people’s
court, the procedures for conducting a civil action, and the procedures for enforcement of a civil
judgment or ruling. All parties to a civil action conducted within the PRC shall comply with the Civil
Procedure Law. A civil case is generally heard at 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 the
place directly associated with the disputes, such as the plaintiff’s or the defendant’s place of domicile,
the place where the contract is performed or signed or the place where the subject matter of the action
is located. However, such choice shall not in any circumstances contravene the regulations of
hierarchical jurisdiction and exclusive jurisdiction.
A foreign individual, a person without a nationality, a foreign enterprise or organization is
given the same litigation rights and obligations as a citizen and legal person of the PRC. Should a
foreign court limit the litigation rights of a PRC citizen and enterprise, the PRC court may apply the
same limitations to the citizens and enterprises of such foreign country. A foreign individual, a person


--- page 490 ---
IV-4
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
without nationality, a foreign enterprise or organization must engage a PRC lawyer if they need to
engage a lawyer for the purpose of initiating an action or defending against litigation at a PRC court. In
accordance with the international treaties to which the PRC is a signatory or participant or according to
the principle of reciprocity, a PRC 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 PRC
people’s court shall not accommodate any request made by a foreign court which will result in the
violation of sovereignty, security or social and public interests of the PRC.
A party shall comply with a law-binding civil judgment or ruling, if any party to a civil action
refuses to comply with a judgment or ruling made by a people’s court or an award made by an
arbitration panel in the PRC, the other party may apply to the people’s court for the enforcement of the
same within two years. However, they may apply for an extension for the enforcement or revocation. If
such party fails to satisfy a judgment as enforced and permitted by the court within the stipulated time,
the court may, upon application by either party, enforce the judgment in accordance with the law.
A party seeking to enforce a judgment or ruling of a people’s court against another party who is
not personally or whose property is not within the PRC may apply to a foreign court with the
jurisdiction over the case for recognition and enforcement of such judgment or ruling. A foreign
judgment or ruling may also be recognized and enforced by a PRC people’s court according to PRC
enforcement procedures if the PRC has entered into or acceded to an international treaty with the
relevant foreign country, which provides for such recognition and enforcement, or if the judgment or
ruling satisfies the court’s examination according to the principle of reciprocity, unless the people’s
court believes that the recognition or enforcement of such judgment or ruling will result in a violation
of the basic legal principles of the PRC, its sovereignty or national security or against its social and
public interests.
THE PRC COMPANY LAW, THE OVERSEAS LISTING REGULATIONS, AND THE
GUIDELINES
A company limited by shares which is incorporated in the PRC and listed on the Stock
Exchange is mainly subject to the following laws and regulations in the PRC:
1) The PRC Company Law (
), which was promulgated by the
SCNPC on December 29, 1993, came into effect on July 1, 1994, and was amended on
December 25, 1999, August 28, 2004, October 27, 2005, and December 28, 2013,
respectively, and the latest amendment had been implemented since October 26, 2018. On
December 29, 2023, the SCNPC published the amended PRC Company Law, which came
into effect on July 1, 2024;
2) The Trial Administrative Measures of Overseas Securities Offering and Listing by
Domestic Companies (
) (the “ Overseas
Listing Regulations ”), which were promulgated by the CSRC on February 17, 2023 and
came into effect on March 31, 2023, and were applicable to the overseas offering and
listing of PRC domestic companies;
3) The Guidelines for Articles of Association of Listed Companies (
ˏ)
(the “Guidelines”), which were issued by the CSRC on December 16, 1997, latest revised
December 15, 2023 and came into effect on the same date, providing the guidelines for the
Articles of Association.


--- page 491 ---
IV-5
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
Below sets out a summary of the major provisions of the PRC Company Law, the Overseas
Listing Regulations and the Guidelines applicable to the Company:
General Provisions
A joint stock limited company is an enterprise legal person incorporated under the PRC
Company Law with its registered capital divided into shares of equal par value. The liability of its
shareholders is limited to the shares they hold, and the company’s liability to its creditors is limited to
its total assets.
A joint stock limited company shall conduct its business in accordance with laws and
administrative regulations. It may invest in other limited liability companies and joint stock limited
companies, with liabilities limited to the amount invested. If a law prescribes that a company shall not
become a capital contributor bearing joint and several liability for the debts of the enterprises it invests
in, such provisions shall prevail.
Incorporation
A joint stock limited company may be incorporated by initiation or fundraising. A joint stock
limited company shall be incorporated by 1 to 200 initiators, provided that at least more than half of
the initiators must reside in the PRC. Where a joint stock limited company is to be established by
means of initiation, initiators shall fully subscribe for the shares that shall be issued at the time of the
establishment of the company as provided for in the Articles of Association. If a joint stock limited
company is to be established by means of fundraising, the initiators shall subscribe to not less than
35% of the total shares to be issued at the time of the establishment of the company as provided for in
the Articles of Association; however, unless otherwise provided by laws or administrative regulations.
A prospectus and subscription letter shall be prepared when the initiators offer shares to the
public. The subscribers shall fill in the number of shares subscribed for, amount and domicile and affix
his/her signature or seal to the subscription letter. The subscriber shall make full payment for the
subscribed shares. Where an initiator 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 initiator 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 share capital for a
public offering has 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. Where the shares to be
issued have not been fully subscribed for at the time of the establishment of a company, or the
initiators fail to hold an establishment meeting within 30 days after the full payment has been made for
the shares to be issued, subscribers may claim against the initiators for refund of the payment for
shares plus the interest on the bank deposits for the same term. The initiators and subscribers may not
withdraw their share capital after they have made payment for the shares or delivered non-monetary
property as capital contributions, except that the shares have not been fully subscribed for within the
time limit, the initiators fail to hold the establishment meeting on schedule, or the establishment
meeting decides not to establish the company. The Board of Directors shall, within 30 days after the
end of the establishment meeting of a company, authorize a representative to file an application for
registration of establishment with the company registration authority.


--- page 492 ---
IV-6
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
A company’s initiator shall be liable for the followings: (1) the debts and expenses incurred in
the establishment process jointly and severally if the company cannot be established; (2) the refund of
subscription monies paid by the subscribers together with interest at bank deposit rates for the same
period jointly and severally if the company cannot be established.
Share Capital
The initiators may make a capital contribution in currencies, or non-monetary assets such as in
kind or intellectual property rights, land use rights, stock rights or creditor’s rights which can be
appraised with monetary value and transferred lawfully, except for assets which are prohibited from
being contributed as capital by the laws or administrative regulations. If a capital contribution is made
in non-monetary assets, a valuation of the assets contributed must be carried out pursuant to the
provisions of the laws or administrative regulations on valuation without any over-valuation or under-
valuation. If there are provisions on the assessment of value in any law or administrative regulation,
such provisions shall prevail.
The issuance of shares shall be conducted in a fair and equitable manner. Each share of the
same class must carry equal rights. Shares issued at the same time and within the same class must be
issued on the same conditions and at the same price. The same price per share shall be paid by any
share subscriber. The issue price of par value stock may be based on the face value or exceed the face
value but shall not be lower than the face value.
Under the PRC Company Law, a joint stock limited company shall maintain a shareholder
register which sets forth the following matters: (1) the name and domicile of each shareholder; (2) the
type and quantity of subscribed shares for each shareholder; (3) for stocks issued in paper form, the
serial numbers of stocks; (4) the date on which each shareholder acquired the shares.
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 shareholder’s meeting. The Articles of
Association or the shareholders’ meeting may authorize the Board of Directors to decide to issue not
more than 50% of the shares that have been issued within three years. However, if the capital
contributions are to be made using non-monetary property, they shall be subject to a resolution made
by the shareholders’ meeting. Where the Board of Directors is authorized and decides to issue shares
and thus results in a change in the registered capital or the number of issued shares of the company, the
voting at the shareholders’ meeting may not be needed to revise such item set forth in the Articles of
Association of the company. Where the Articles of Association or the shareholders’ meeting of a
company authorizes the Board of Directors to decide on issuing new shares, a resolution of the Board
of Directors shall be adopted by two thirds of all the directors. In addition, where a domestic enterprise
issuing and listing overseas, the issuer shall file with the CSRC in accordance with the Overseas
Listing Trial Measures and submit a filing report, legal opinions and other relevant materials, giving a
true, accurate and complete account of shareholders’ information and other information.


--- page 493 ---
IV-7
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
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 shareholders’ 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.
Where a company reduces its registered capital, it shall reduce the amount of capital
contribution or shares in proportion to the capital contribution or shares held by the shareholders,
unless it is otherwise prescribed by any law, or is otherwise prescribed by the Articles of Association
of the company.
If a company still has losses after making up for them in accordance with the relevant
provisions of the PRC Company Law, it may reduce its registered capital to make up for the losses. If
the registered capital is reduced to make up for the loss, the company shall not make any distribution to
the shareholders, nor shall the shareholders be exempted from their obligation to pay the capital
contribution or the share capital. If the registered capital is reduced in accordance with the aforesaid
provisions, the item (III) and item (IV) mentioned above shall not apply, but the resolution to reduce
the registered capital shall be made by the shareholders’ meeting within 30 days from the date of the
announcement in the newspapers or on the National Enterprise Credit Information Publicity System.
After a company reduces its registered capital in accordance with the provisions of the preceding
paragraphs, it shall not distribute profits until the accumulated amount of statutory reserve and
discretionary reserve reaches 50% of the company’s registered capital.
When a company reduces its registered capital in violation of the provisions of the PRC
Company Law, its shareholders shall refund the funds they have received, and if the capital
contributions of the shareholders are reduced or exempted, such capital contributions shall be restored
to the original status; if any loss is caused to the company, the shareholders and the liable directors,
supervisors and senior management shall bear the liability for compensation.
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;


--- page 494 ---
IV-8
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
(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 shareholders’ 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 shareholders’ meeting is required for the repurchase of shares by a company
under either of the circumstances stipulated in item (I) or 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 Company’s Articles of Association or as
authorized by the shareholders’ meeting.
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 company shall not accept its own shares as the subject matter of a mortgage.
No company may provide gifts, loans, guarantees or other financial aids for others to obtain the
shares of the company or the parent company thereof unless it carries out an employee stock ownership
plan. For the benefits of the company, the company may, upon a resolution by the shareholders’
meeting or by the Board of Directors under the Articles of Association or the authorization of the
shareholders’ meeting, provide financial aids for others to obtain the shares of the company or the
parent company thereof, provided that the total accumulative amount of the financial aids shall not
exceed 10% of the total issued share capital. A resolution by the Board of Directors shall be adopted by
two thirds of all the directors.
Any director, supervisor or senior management who is liable for any loss to the company due to
violation of the provisions of the preceding paragraph shall make compensations.
Transfer of Shares
The shares held by a shareholder of a company may be transferred to other shareholders or to
persons other than the shareholders of the company. Where the Articles of Association of the company
have any restriction on the transfer of shares, the transfer shall be carried out in accordance with the
Articles of Association. Under the PRC Company Law, a shareholder should affect a transfer of his
shares on the stock exchange established in accordance with laws or by any other means as required by


--- page 495 ---
IV-9
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
the State Council. The transfer of shares by a shareholder must be conducted by means of an
endorsement or by other means stipulated by laws or by administrative regulations. Following the
transfer of shares, 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 shareholders’ meeting or 5 days prior to the base date on
which the company decides to distribute dividends. However, where it is otherwise provided for in any
law, administrative regulation or by the security’s regulatory authority of the State Council for the
modification of the register of shareholders of a listed company, such provisions shall prevail.
Pursuant to the PRC Company Law, shares of the company issued prior to the public issue of
shares may not be transferred within one year of the date of the company’s listing on the stock
exchange. Where it is otherwise provided for in any law, administrative regulation or by the securities
regulatory authority of the State Council for the transfer of shares held by the shareholders or actual
controllers of a listed company, such provisions shall prevail. Directors, supervisors and senior
management of the company shall declare to the company the shares they hold and the changes thereof
during the term of office as determined when they assume the posts, the shares transferred each year
shall not exceed 25% of the total shares they hold of the company. They shall not transfer the shares
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,
supervisors and the senior management. Where the shares are pledged within the time limit for
restricted transfer as provided for by laws and administrative regulations, the pledgee may not exercise
the pledge right within such restricted period.
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 Articles of Association, the rights of
shareholders include the rights:
(I) to be legally entitled to assets income, participate in significant decision-making and
select management personnel;
(II) to petition the people’s court to revoke any resolution of a shareholders’ meeting, a
shareholders’ meeting or a meeting of 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 of the company, 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 shareholders’ meeting and exercise the voting
rights;


--- page 496 ---
IV-10
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
(V) to inspect and copy the Articles of Association of the company, share register, the
minutes of shareholders’ meeting, board resolutions, resolutions of the Board of
Supervisors 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’s responsibilities in respect of the shares taken up by them and any other shareholder
obligation specified in the Articles of Association of the company.
Shareholders’ meeting
The shareholders’ meeting is the organ of authority of the company, which exercises its powers
in accordance with the PRC Company Law. The shareholders’ meeting may exercise its powers:
(I) to elect or replace the directors and supervisors and to decide on their remunerations;
(II) to consider and approve the reports of the Board of Directors;
(III) to consider and approve the reports of the Board of Supervisors;
(IV) to consider and approve the company’s profit distribution and loss recovery proposals;
(V) to decide on any 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 of the company; and
(IX) to exercise any other authority stipulated in the Articles of Association of the company.
The shareholders’ 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 Articles of Association, a
shareholders’ meeting is required to be held once a year within six months after the end of the previous
accounting year. An interim shareholders’ 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 capital stock;


--- page 497 ---
IV-11
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
(III) shareholders individually or in aggregate holding 10% or more of the company’s shares
request to convene an interim shareholders’ meeting;
(IV) the Board of Directors deems necessary;
(V) the Board of Supervisors so proposes; or
(VI) any other circumstances as provided for in the Articles of Associations of the company.
A shareholders’ meeting is convened by the Board of Directors and presided over by the
chairman of the Board of Directors. In the event that the chairman is incapable of performing or is not
performing his or her duties, the meeting shall be presided over by the vice chairman. If the vice
chairman is incapable of performing or is not performing his or her duties, a director jointly
recommended by more than half of directors shall preside over the meeting. If the Board of Directors is
unable to or fails to perform its duty of convening the shareholders’ meeting, the Board of Supervisors
shall convene and preside over such meeting in a timely manner; if the Board of Supervisors fails to
convene and preside over such meeting, shareholders who individually or jointly hold more than 10%
of the company’s shares for more than 90 consecutive days may independently convene and preside
over such meeting. If the shareholders who individually or jointly hold more than 10% of the shares of
the company request to convene an interim shareholders’ meeting, the Board of Directors and the
Board of Supervisors shall, within 10 days after the receipt of such request, decide whether to hold an
interim shareholders’ meeting and reply to the shareholders in writing.
In accordance with the PRC Company Law, a notice stating the time and venue of the meeting
and the matters to be considered at the meeting shall be given to all shareholders 20 days before the
meeting if the shareholders’ meeting is convened. Notice of the interim shareholders’ meeting shall be
given to all shareholders 15 days before the meeting. Shareholders who individually or jointly hold
more than one percent of the shares of the company may submit an interim proposal in writing to the
Board of Directors ten days before the shareholders’ meeting is held. The Board of Directors shall
notify other shareholders within two days upon receipt of the proposal, and submit the interim proposal
to the shareholder’s meeting for deliberation, unless the interim proposal is in violation of any law,
administrative regulation or the Articles of Association or fails to fall into the scope of functions of the
shareholders’ meeting. The company shall not raise the shareholding proportion of the shareholder who
brings forward any interim proposal. A company offering shares to the public shall make the notices as
mentioned in the preceding paragraphs by way of announcement. The shareholders’ meeting shall not
make any resolution on any matter not specified in the notice.
According to the PRC Company Law, shareholders present at shareholders’ meeting shall have
one vote for each share they hold, except the shareholders of classified shares. The company may not
have a voting right for the shares it holds.
An accumulative voting system may be adopted for the election of directors and supervisors at
the shareholders’ meeting pursuant to the provisions of the Articles of Association of the company or a
resolution of the shareholders’ meeting. Under the accumulative voting system, when the shareholders’
meeting elects directors or supervisors, each share has the same voting rights as the number of
directors or supervisors to be elected, and the voting rights owned by shareholders can be used
collectively.


--- page 498 ---
IV-12
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
Under the PRC Company Law, the passing of any resolution at the shareholder’s meeting
requires affirmative votes of shareholders representing more than half of the voting rights held by the
shareholders who attend the shareholder’s meeting except in cases of proposed 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 more than
two-thirds of the voting rights held by the shareholders who attend the shareholder’s meeting.
Minutes shall be prepared in respect of matters considered at the shareholders’ 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 proxy forms.
Board of Directors
A joint stock limited company shall have a board. However, a joint stock limited company with
a relatively small scale or relatively small number of shareholders may dispense with the Board of
Directors and have one director to exercise the functions and powers of the Board of Directors as
prescribed by the PRC Company Law. If the Board of Directors of a company has more than three
members, it may include an employees’ representative of the company. Where a company has 300 or
more employees, the Board of Directors shall include the employees’ representatives of the company
unless the Board of Supervisors has been established and includes employees’ representatives of the
company. The employees’ representatives in the Board of Directors shall be democratically elected by
the employees through the employees’ representative congress, employees’ congress or by other
means.
The term of office of the directors shall be provided for by 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 results in the number of directors being less than the quorum. Where a director
resigns, he/she shall notify the company in written form, and the resignation shall become effective on
the day when the company receives the notice.
However, under any of the circumstances as mentioned in the preceding paragraph, the director
shall continue performing his/her duties.
Under the PRC Company Law, the Board of Directors may exercise the following powers:
(I) to convene shareholders’ meeting and report on its work to the shareholders’ meeting;
(II) to implement the resolutions passed by the shareholders at the shareholders’ meeting;
(III) to decide on the Company’s operational plans and investment proposals;
(IV) to formulate the Company’s proposals for profit distribution and for recovery of losses;
(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;


--- page 499 ---
IV-13
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
(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 general 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 shareholders’
meeting.
Any restrictions on the functions and powers of the Board of Directors set out in the Articles of
Association may not be asserted against any bona fide third party.
Under the PRC Company Law, a company may, under the Articles of Association, set up an
audit committee composed of directors in the Board of Directors, which shall exercise the functions
and powers of the Board of Supervisors. It may not have a Board of Supervisors or supervisors. The
audit committee shall be composed of at least 3 members, and more than half of the members shall not
assume any position other than the director in the company and shall not have any relationship with the
company that may affect their independent and objective judgments. Among the members of the Board
of Directors of the company, an employees’ representative may become a member of the audit
committee. A resolution made by the audit committee shall be adopted by more than half of the
members thereof. For voting on a resolution of the audit committee, each member shall have one vote.
The discussion methods and voting procedures of the audit committee shall be prescribed in the
Articles of Association, unless it is otherwise provided under the PRC Company Law. A company may
set up other committees in the Board of Directors under the Articles of Association.
Meeting of the Board of Directors shall be convened at least twice a year. Notice of meeting
shall be given to all Directors and Supervisors 10 days before the meeting. Interim board meeting may
be proposed to be convened by shareholders representing more than one-tenth of the voting rights,
more than one-third of the Directors or the Board of Supervisors. The chairman shall convene the
meeting within 10 days of receiving such proposal and preside over the board meeting. 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.
No meeting of the Board of Directors may be held unless more than half of the directors are
present. A resolution made by the Board of Directors shall be adopted by more than half of all the
directors. For voting on a resolution of the Board of Directors, each director shall have one vote. The
Board of Directors shall prepare minutes regarding the decisions on the matters discussed at the
meetings, which shall be signed by the directors present.
The directors shall attend the meeting of the Board of Directors in person. Where any director
is unable to attend the meeting for any reason, he/she may, by issuing a written power of attorney,
entrust another director to attend the meeting on his/her behalf. The power of attorney shall indicate the
scope of authorization. The directors shall be responsible for the resolutions made by the Board of
Directors. Where a resolution of the Board of Directors is in violation of any law, administrative
regulation, Article of Association or resolution of the shareholders’ meeting and causes any serious


--- page 500 ---
IV-14
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
loss to the company, the directors who participate in adopting such resolution shall be liable for
compensation to the company. If a director is proved to have expressed his/her objection to the voting
on such resolution and such objection has been recorded in the minutes, he/she may be exempted from
liability.
Under 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;
within two years after being pronounced for suspension of sentence since the expiration
of the suspension of sentence;
(III) within three years after insolvency and liquidation of such Company or enterprise where
the person acted as a director, factory manager or business 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) being listed as a dishonest person subject to enforcement by the people’s court due 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.
In addition, the Guidelines for Articles of Association of Listed Companies further stipulates
other circumstances under which a person is disqualified from acting as a director of a company,
including: (1) a person who has been banned from the securities market by the CSRC where the
relevant period remains unexpired; or (2) a person who is banned from doing so in accordance with
other laws, administrative regulations or departmental rules.
Under the PRC Company Law, the Board shall appoint a chairman and may appoint a vice
chairman. The chairman and the vice chairman shall be elected with approval of more than half of all
the directors. The chairman shall convene and preside over the board meeting 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 nominated by more than half of the directors shall perform his/her
duties.
Board of Supervisors
A joint stock limited company shall have a Board of Supervisors composed of three members
or more. However, a joint stock limited company (i) with a relatively small scale or relatively small


--- page 501 ---
IV-15
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
number of shareholders may dispense with the Board of Supervisors, but may have one supervisor,
who shall exercise the functions and powers of the Board of Supervisors, and (ii) may not have a Board
of Supervisors or supervisors if it sets up an audit committee composed of directors in the Board of
Directors, which shall exercise the functions and powers of the Board of Supervisors. The Board of
Supervisors shall consist of representatives of the shareholders and an appropriate proportion of
representatives of the Company’s staff, of which the proportion of representatives of the company’s
staff shall not be less than one-third, and the actual proportion shall be determined in the Articles of
Association. Representatives of the Company’s staff at the Board of Supervisors shall be
democratically elected by the Company’s staff at the staff representative assembly, general staff
meeting or otherwise.
The Board of Supervisors shall appoint a chairman and may appoint a vice chairman. The
chairman and the vice chairman of the Board of Supervisors shall be elected by more than half of all
the supervisors. Directors and senior management shall not act concurrently as supervisors. The
chairman of the Board of Supervisors shall convene and preside over the Board of Supervisors
meeting. Where the chairman of the Board of Supervisors is incapable of performing or is not
performing his/her duties, the vice chairman of the Board of Supervisors shall convene and preside
over the Board of Supervisors meeting. Where the vice chairman of the Board of Supervisors is
incapable of performing or is not performing his/her duties, a supervisor elected by more than half of
the supervisors shall convene and preside over the Board of Supervisors meeting.
The supervisors serve three-year terms. A supervisor may serve consecutive terms if re-elected
upon the expiration of his/her term. A supervisor shall continue to perform his/her duties as a
supervisor in accordance with the laws, administrative regulations and the Articles of Association until
a duly re-elected supervisor takes office, if re-election is not conducted in a timely manner upon the
expiry of his/her term of office or if the resignation of supervisors results in the number of supervisors
being less than the quorum.
The Board of Supervisors may exercise its powers:
(I) to review the company’s financial position;
(II) to supervise the directors and senior management in their performance of their duties
and to propose the removal of directors and senior management who have violated laws,
regulations, the Articles of Association or resolutions of the shareholders’ meeting;
(III) when the acts of a director or senior management are detrimental to the company’s
interests, to require the director and senior management to correct these relevant acts;
(IV) to propose the convening of extraordinary shareholders’ meeting and to convene and
preside over shareholders’ meeting when the board fails to perform the duty of
convening and presiding over shareholders’ meeting under the PRC Company Law;
(V) to submit proposals to the shareholders’ meeting;
(VI) to bring actions against directors and senior management pursuant to the relevant
provisions of the PRC Company Law; and
(VII) to exercise any other authority stipulated in the Articles of Association.


--- page 502 ---
IV-16
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
Supervisors may be present at board meeting and make inquiries or proposals in respect of the
resolutions of the Board of Directors. The Board of Supervisors may investigate any irregularities
identified in the operation of the company and, when necessary, may engage an accounting firm to
assist its work at the cost of the company.
Manager and Senior Management
Pursuant 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 shall be responsible to the
Board of Directors and exercise his/her functions and powers according to the Articles of Association
or the authorization of the Board of Directors. The manager shall attend the meeting of the Board of
Directors as a non-voting member.
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, Supervisors, General Managers and Other Senior Management
Directors, supervisors and senior management shall comply with laws, administrative
regulations and the Articles of Association.
Directors, supervisors and senior management shall assume the obligation of loyalty to the
company and take measures to avoid the conflict between their own interests and those of the company
and may not seek any improper interests by taking advantage of their powers. The directors,
supervisors and senior management shall assume the duty of diligence to the company. When
performing their duties, they shall, for the best interests of the company, exercise the reasonable care
that shall be generally possessed by a manager.
The provisions of the preceding paragraphs shall apply to the controlling shareholder or actual
controller of a company who does not serve as a director but actually executes the affairs of the
company.
In the meantime, directors, supervisors and senior management are prohibited from:
(I) embezzling the property or misappropriating the funds of the company;
(II) depositing company funds into accounts under their own names or the names of other
individuals;
(III) giving bribes or accepting any other illegal proceeds by taking advantage of his/her
power;
(IV) accept commissions from transactions between others and the company for their own
benefits;
(V) unauthorized divulgence of confidential information of the company; and
(VI) other acts in violation of their duty of loyalty to the company.


--- page 503 ---
IV-17
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
A director, supervisor or senior management who contravenes laws, administrative regulations
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, supervisor or senior management is required to attend a shareholders’
meeting, such director, supervisor or senior management shall attend the meeting and answer the
inquiries from shareholders. The Board of Supervisors may demand the directors or senior
management to submit reports on the performance of their duties. The directors and senior
management shall truthfully provide relevant information and materials to the Board of Supervisors,
none of them may impede the exercise of powers by the Board of Supervisors or supervisors.
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 Board of Supervisors 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 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 Board of Supervisors 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
shareholder(s) may institute litigation at a people’s court in accordance with the procedure 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.
If a director, supervisor or senior management of a wholly-owned subsidiary of the company
violate laws, administrative regulations or the Articles of Association in performance of duties to the
company, thereby causing damages to the company, or if the legitimate rights and interests of a
wholly-owned subsidiary of the company are impaired by any other person, thus causing any losses,
the shareholders of a limited liability company or shareholders of a joint stock limited company
individually and jointly holding 1% or more of the total shares of the company for 180 consecutive
days or more may request the Board of Supervisors or the Board of Directors of the wholly-owned
subsidiary in written form to initiate a lawsuit in the people’s court or directly files a lawsuit with the
people’s court in their own name.
Finance, Accounting and Profit Distribution
According to 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


--- page 504 ---
IV-18
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
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 shareholder’s meeting. A joint stock limited company that makes public stock
offerings shall 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 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 shareholders’ 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 to
shareholders 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. Profit shall not be
distributed for a company’s shares held by this company.
Where a company distributes profits to shareholders in violation of the relevant provisions of
the PRC Company Law, the shareholders shall refund the profits distributed to the company, and the
shareholders and the liable directors, supervisors and senior management shall be held liable for
compensation if any loss is caused to the company.
If the shareholders’ meeting resolves to distribute profits, the Board of Directors shall do so
within six months after the resolution is made.
The premiums received by a company from the issuance of shares at an issue price in excess of
the par value of the shares, the amount of share proceeds from the issuance of no-par shares that have
not been credited to the registered capital, and other items required by the financial department of the
State Council to be included in the capital reserve shall be classified as the capital reserve of the
company.
The reserve of a company shall be used for making up losses, expanding the production and
business scale or increasing the registered capital of the company. Where the reserve of a company is
used for making up losses, the discretionary reserve and statutory reserve shall be firstly used. If losses
still cannot be made up, the capital reserve can be used according to the relevant provisions. Where the
statutory reserve is converted to increase registered capital, the amount of such reserve retained shall
not be less than 25% of the registered capital of the company prior to the conversion.
The company shall have no accounting books other than the statutory books. The company’s
funds shall not be deposited in any account opened under the name of an individual.
After a company reduces its registered capital in accordance with the provisions of the PRC
Company Law, it shall not distribute profits until the accumulated amount of statutory reserve and
discretionary reserve reaches 50% of the company’s registered capital.


--- page 505 ---
IV-19
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
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 shareholders’
meeting, the Board of Directors or the Board of Supervisors in accordance with the Articles of
Association. The accounting firm should be allowed to make representations when the shareholders’
meeting, the Board of Directors or the Board of Supervisors 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.
Amendment to Articles of Association
Pursuant to PRC Company Law, the resolution of a shareholders’ meeting regarding any
amendment to a company’s Articles of Association requires affirmative votes by at least 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 approved by the
resolution of the shareholder’s meeting of shareholders 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 or occurrence
of other circumstances of dissolution stipulated in the Articles of Association;
(II) the shareholders’ 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 or 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 10% or more of the voting rights of all shareholders of the company.
If any of the situations as mentioned in the preceding paragraph arises, a company shall
publicize the situations through the National Enterprise Credit Information Publicity System within ten
days.
Where a company falls under the circumstance as mentioned in Items (I) or (II) of the
paragraph above and it has not distributed the assets to its shareholders yet, it may survive by
modifying its articles of association or upon a resolution of the shareholders’ meeting.


--- page 506 ---
IV-20
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
To modify its articles of association or make a resolution of the shareholders’ meeting
according to the provisions of the preceding paragraph, the consent of two thirds or more of the voting
rights of the shareholders who attend the meeting of the shareholders’ meeting is required.
Where the company is dissolved under the circumstances set forth in item (I), (II), (IV) or
(V) above, it shall be liquidated. The directors, who are the liquidation obligors of the company, shall
form a liquidation group to carry out liquidation within 15 days from the date of occurrence of the
cause of dissolution. The liquidation group shall be composed of the directors, unless it is otherwise
provided for in the company’s Articles of Association or it is otherwise elected by the shareholders’
meeting.
The liquidation obligors shall be liable for compensation if they fail to fulfill their obligations
of liquidation in a timely manner, and thus any loss is caused to the company or the creditors.
The liquidation committee may exercise following powers during the liquidation:
(I) to verify 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 settle any outstanding business of relevant company;
(IV) to pay all outstanding taxes and the taxes arising during the liquidation process;
(V) to settle claims and debts;
(VI) to distribute the company’s remaining assets after its debts have been paid off; and
(VII) to represent the company in civil lawsuits.
The liquidation committee shall notify the company’s creditors within 10 days of its
establishment, and publish an announcement in newspapers or on the National Enterprise Credit
Information Publicity System within 60 days.
A creditor shall lodge his claim with the liquidation committee within 30 days of receipt of the
notification or within 45 days of the date of the announcement if he has not received any notification.
The creditors shall explain matters relating to their claims and provide evidential documents.
The liquidation committee shall register the creditor’s claims. In the claims declaration period, the
liquidation committee shall not make repayment to the creditors.
Upon disposal of the company’s property and preparation of the required balance sheet and
inventory of assets, the liquidation committee shall draw up a liquidation plan and submit this plan to a
shareholders’ 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 to shareholders 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 property shall not be distributed to shareholders before repayments are made in accordance
with the requirements described above.


--- page 507 ---
IV-21
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
Where the liquidation group finds that the property of the company are not sufficient for paying
off the debts after liquidating the property of the company and preparing a balance sheet and an
inventory of property, it shall file an application to a people’s court for bankruptcy liquidation. After
the people’s court accepts the application for bankruptcy, the liquidation group shall hand over the
liquidation matters to the bankruptcy administrator designated by the people’s court.
The members of the liquidation group performing their duties of liquidation are obliged to
loyalty and diligence. Any member of the liquidation group who neglects to fulfill his/her liquidation
duties, thus causing any loss to the company shall be liable for compensation, and any member of the
liquidation group who cause any loss to any creditor due to his/her intentional or gross negligence shall
be liable for compensation.
Upon completion of the liquidation of the company, the liquidation group shall produce a
liquidation report, report the same to the shareholders’ meeting or the people’s court for confirmation,
and submit the same to the company registration authority to apply for deregistration of the company.
Where, during the period of survival, a company has not incurred any debts or has paid off all
the debts, the company may, upon a commitment of all the shareholders, be deregistered under the
summary procedures according to the relevant provisions. The deregistration of a company under the
summary procedures shall be announced through the National Enterprise Credit Information Publicity
System for a period of no less than 20 days. If there is no objection after the expiry of the
announcement period, the company may apply for deregistration of the company with the company
registration authority within 20 days.
For a company deregistered under the summary procedures, its shareholders shall be jointly and
severally liable for the debts incurred before the deregistration if they have made an untrue
commitment.
Where, after three years since the business license of a company is revoked, or the company is
ordered to close or is revoked, the company fails to apply for its deregistration with the company
registration authority, the said authority may announce the company’s deregistration through the
National Enterprise Credit Information Publicity System for a period of no less than 60 days. If there is
no objection after the announcement period expires, the company registration authority may deregister
the company. Such deregistration of a company will not affect the liability of the original shareholders
or liquidation obligors.
Overseas Listing
Pursuant to the Overseas Listing Regulations, where an issuer applies for initial public offering
to competent overseas regulators, such issuer must file with the CSRC within three business days after
such application is submitted.
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


--- page 508 ---
IV-22
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
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(s).
Merger and Division
Pursuant to the PRC Company Law, a merger agreement shall be signed by merging companies
and the involved companies shall prepare respective balance sheets and inventory of assets. The
companies shall within 10 days of the date of passing the resolution approving the merger notify their
respective creditors and publicly announce the merger in newspapers or on the National Enterprise
Credit Information Publicity System within 30 days. A creditor may, within 30 days of receipt of the
notification, or within 45 days of the date of the announcement if he has not received the notification,
request the company to settle any outstanding debts or provide relevant guarantees. In case of a
merger, the credits and debts of the merging parties shall be assumed by the surviving or the new
company.
In case of a division, the company’s assets shall be divided and a balance sheet and an
inventory of assets shall be prepared. When a resolution regarding the company’s division is approved,
the company should notify all its creditors within 10 days of the date of passing such resolution and
publicly announce the division in newspapers or on the National Enterprise Credit Information
Publicity System within 30 days. The liabilities of the company which have accrued prior to the
division shall be jointly borne by the separated companies, unless otherwise stipulated in the agreement
in writing entered by the company with creditors in respect of the settlement of debts prior to division.
SECURITIES LAWS AND REGULATIONS
The PRC has promulgated a series of regulations in relation to issuance and trading of a
company’s 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-rela ted policies, planning the development of securities
markets, directing, coordinating and supervising all securities related institutions in the PRC, and
administering CSRC. CSRC is the regulatory arm of the Securities Committee and is responsible for
drafting regulatory provisions governing securities markets, supervising securities companies, regulating
public offerings of securities by PRC companies in the PRC or overseas, managing the trading of
securities, preparing securities-related statistics and conducting relevant research and analysis. The State
Council dissolved its Securities Committee and its duties were assumed by CSRC in 1998.
The Securities Law came into 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, and the last revised
Securities Law was implemented on March 1, 2020. The Securities Law is the first volume of national
securities law in the PRC to fully regulate the activities in securities market in the PRC. It is divided
into 14 chapters and 226 articles covering the issuance and trading of securities, the takeovers of listed
companies, and the duties and responsibilities of stock exchanges, securities companies, securities
registration and clearing institutions, and securities regulatory and administration authorities. Article
224 of the Securities Law provides that a domestic enterprise shall satisfy the relevant requirements set
out by the State Council when they issue or list securities outside the PRC directly or indirectly.
Currently, the issuance and trading of shares (including H Shares) outside the PRC are governed by the
regulations and rules promulgated by the State Council and CSRC.


--- page 509 ---
IV-23
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
ARBITRATION AND ENFORCEMENT OF AN ARBITRAL AWARD
The Arbitration Law of the PRC (2017 Amendment) (the “ Arbitration Law”) was enacted by
the SCNPC on August 31, 1994, and came into effect on September 1, 1995, and was last amended on
September 1, 2017 and implemented on January 1, 2018. It is applicable to the disputes relating to
contracts and other properties in which the involved parties have entered into a written agreement to
resolve the disputes by arbitration of an arbitration committee constituted in accordance with the
Arbitration Law. The Arbitration Law provides that an arbitration committee may, before the
promulgation of arbitration regulations by the PRC Arbitration Association, formulate interim
arbitration provisions in accordance with the Arbitration Law and the Civil Procedure Law. Where the
parties have reached an arbitration agreement, a people’s court will refuse to handle a legal proceeding
initiated by one party made to such people’s court, unless the arbitration agreement is invalid.
The Hong Kong Listing Rules requires that arbitration clauses shall be included in the articles of
association of a company listed in Hong Kong, and the Hong Kong Listing Rules also require that
arbitration clauses shall be included in contracts between the company and each of the directors or
supervisors, such that in case of occurrence of any dispute or claim among the following parties, such
dispute or claim shall refer to arbitration: (1) a holder of H Shares and a company; (2) a holder of H Shares
and a holder of domestic shares; (3) a holder of H Shares and directors, supervisors or other management
personnel of a company, which are disputes or rights of assertion in relation to the affairs of the company
arising from rights and obligations as provided in the articles of association, the PRC Company Law and
other relevant laws and administrative regulations concerning the affairs of the company.
Such parties may elect to refer such disputes or rights of assertion to arbitration at the China
International Economic and Trade Arbitration Commission or the Hong Kong International Arbitration
Center. Disputes as defined by such shareholder and the disputes in relation to the company’s register
do not necessarily resolve by arbitration. If the party seeking arbitration elects to arbitrate the dispute
or claim at the Hong Kong International Arbitration Center, then either party may apply to have such
arbitration to be conducted in Shenzhen in accordance with the securities arbitration rules of the Hong
Kong International Arbitration Center.
Under the Arbitration Law and the Civil Procedure Law, an arbitral award shall be final. Once
an arbitral award is made, an arbitration committee or a people’s court will refuse to accept the
application for arbitration or prosecution filed to the people’s court by a party regarding the same
dispute. If either party fails to comply with the arbitral award, the other party to the award may apply
to the people’s court to enforce such arbitration award. However, the people’s court may refuse to
enforce an arbitral award made by the arbitration committee if there is a violation of the arbitration of
procedures, including but not limited to the violation in the composition of the arbitration tribunal, or
that matter of arbitration does not fall into the scope of the arbitration agreement, or that the arbitration
committee is not entitled to carry out the arbitration.
Corporate Existence
According to the PRC Company Law, a joint stock limited company may be incorporated by
initiation or fundraising.
Share Capital
Under the PRC Securities Law, an application for listing shall comply with the listing rules of
the stock exchange.


--- page 510 ---
IV-24
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
According to the PRC Company Law, a shareholder may make capital contributions in
currency, or in kind, intellectual property, land use right, stock rights, creditor’s rights or other
non-monetary property that may be assessed in currency and transferred according to law, except the
property that may not be used as capital contributions according to any law or administrative
regulation. The non-monetary property as capital contributions shall be assessed and verified, which
may not be overvalued or undervalued. If there are provisions on the assessment of value in any law or
administrative regulation, such provisions shall prevail.
Restrictions on Shareholding and Transfer of Shares
Under the PRC law, the Unlisted Shares, which are denominated and subscribed for in
Renminbi, can only be subscribed for and traded by PRC investors, qualified overseas institutional
investors or qualified overseas strategic investors. Overseas listed shares, which are denominated in
Renminbi and subscribed for in a foreign currency, may only be subscribed for, and traded by,
investors from countries and regions outside the PRC or other qualified PRC institutional investors. If
the H Shares are eligible securities under the Southbound Trading Link, they are also available for
subscription and trading by domestic investors in the PRC pursuant to the rules and restrictions of
Shanghai-Hong Kong Stock Connect or Shenzhen- Hong Kong Stock Connect.
According to the PRC Company Law, the shares issued before a company makes a public
offering of shares shall not be transferred within 1 year as of the day when the stocks of the company
are listed and traded on the stock exchange. Where it is otherwise provided for in any law,
administrative regulation or by the securities regulatory authority of the State Council for the transfer
of shares held by the shareholders or actual controllers of a listed company, such provisions shall
prevail. The directors, supervisors and senior management of the company shall declare to the
company the shares they hold and the changes thereof. During the term of office as determined when
they assume the posts, the shares transferred each year shall not exceed 25% of the total shares they
hold of the company. The shares of the company held by them shall not be transferred within 1 year as
of the day when the stocks of the company are listed and traded on the stock exchange. Any of the
aforesaid persons shall not transfer the shares of the company held within six months after he/she
leaves office. Any other restrictions on the transfer of company shares held by directors, supervisors or
senior executives may be specified in the articles of association.
Notice of Shareholders’ Meeting
According to the PRC Company Law, notice of annual shareholder’s meeting must be given
not less than 20 days before the meeting, while notice of an interim shareholders’ meeting must be
given not less than 15 days before the meeting.
Quorum for Shareholder’s meeting
The PRC Company Law does not specify any quorum requirement for a shareholder’s meeting.
Voting at Shareholder’s meeting
According to the PRC Company Law, a resolution made by the shareholders’ meeting shall be
adopted by the shareholders representing more than half of the voting rights.


--- page 511 ---
IV-25
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
A resolution made by the shareholders’ meeting on modifying the articles of association,
increasing or decreasing the registered capital, as well as merger, division, dissolution or change of
corporate form of the company shall be adopted by the shareholders representing more than two thirds
of the voting rights.
Variation of Class Rights
According to the PRC Company Law, where any of the matters occurs to a company that issues
classified shares and may affect the rights of the classified shareholders, it shall not only be decided by
the shareholders’ meeting but also be adopted by shareholders representing two thirds of the voting
rights who are present at the classified shareholders’ meeting.
Directors
According to the PRC Company Law, where any director directly or indirectly concludes a
contract or conducts a transaction with his/her company, he/she shall report the matters relating to the
conclusion of the contract or transaction to the board of directors or shareholders’ meeting, which shall
be subject to the resolution of the board of directors or shareholders’ meeting according to the articles
of association. Where any of the near relatives of the directors, or any of the enterprises directly or
indirectly controlled by the directors, or any of their near relatives, or any of the related parties who has
any other related-party relationship with the directors, concludes a contract or conducts a transaction
with the company, the aforesaid provisions shall apply. Where a director is removed prior to the
expiration of term of office without any justifiable reason, the director may require the company to
make compensation.
The PRC Company Law, unlike the Companies Ordinance, does not contain any requirements
relating to the declaration of directors’ interests in material contracts, restrictions on directors’
authority in making major dispositions, restrictions on companies providing certain benefits to
directors and guarantees in respect of directors’ liability and prohibitions against compensation for loss
of office without shareholders’ approval.
Board of Supervisors
According to the PRC Company Law, if a joint stock limited company has a board of
supervisors, the directors and senior management of the company are subject to the supervision of the
board of supervisors.
Derivative Action by Minority Shareholders
According to the PRC Company Law, where any director, supervisor or senior management
violates any law, administrative regulation or the articles of association during the performance of
duties and causes any loss to the company, shareholders individually or jointly holding over 1% of the
shares in the company for more than 180 consecutive days may request in writing the board of
supervisors to initiate proceedings in the people’s court. If the supervisors violate the relevant
provisions of the Company Law, the above shareholders may request in writing the board of directors
to initiate litigation at the people’s court. Upon receipt of such written request from the shareholders, if
the board of supervisors or the board of directors refuses to initiate such proceedings, or has not


--- page 512 ---
IV-26
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
initiated proceedings within 30 days upon receipt of the request, or if under urgent situations, failure of
initiating immediate proceeding may cause irremediable damages to the company, the above said
shareholders shall, for the benefit of the company’s interests, have the right to initiate proceedings
directly to the people’s court in their own name.
The Guidelines for the articles of association of Listed Companies also provide other remedies
against the directors, supervisors and senior management who breach their duties to the company. In
addition, as a condition to the listing of shares on the Stock Exchange, each director and supervisor of a
joint stock limited company is required to give an undertaking in favor of the company acting as agent
for the shareholders. This allows minority shareholders to take action against directors and supervisors
of the company in default.
Protection of Minorities
The PRC Company Law provides that where a company meets any serious difficulty in its
operation or management, and the interests of its shareholders will be subject to heavy loss if the
company survives, which cannot be solved by any other means, the shareholders who hold 10% or
more of the voting rights of the company may request the people’s court to dissolve the company.
The Guidelines for the articles of association of Listed Companies also provide other remedies
against the directors, supervisors and senior management who breach their duties to the company. In
addition, as a condition to the listing of shares on the Stock Exchange, each director and supervisor of a
joint stock limited company is required to give an undertaking in favor of the company acting as agent
for the shareholders. This allows minority shareholders to act against directors and supervisors of the
company in default.
Financial Disclosure
According to the PRC Company Law, a joint stock limited company is required to make
available at the company for inspection by shareholders its financial report 20 days before its
shareholders’ meeting. In addition, a joint stock limited company of which the public offering Shares
are offered should publish its financial report.
According to the PRC Company Law, a company shall at the end of each accounting year
prepare a financial report which shall be audited by the accounting firm in accordance with the laws.
Information on Directors and Shareholders
The PRC Company Law gives shareholders the right to inspect and copy the Articles of
Association, minutes of the shareholders’ meeting, resolutions of meetings of the board of directors or
board of supervisors, and financial and accounting reports.
Corporate Reorganization
According to the PRC Company Law, the merger, demerger, dissolution or change to the forms
of a joint stock limited company has to be approved by shareholders at shareholder’s meeting.


--- page 513 ---
IV-27
APPENDIX IV SUMMARY OF PRINCIPAL
LEGAL AND REGULATORY PROVISIONS
Statutory Deductions
According to the PRC Company Law, a company shall draw 10% of the profits as its statutory
reserve fund before it distributes any profits after taxation. When the aggregate amount of the
company’s statutory reserve fund reaches 50% of the company’s registered capital, the company may
no longer make allocations from the statutory reserve fund. After a company has made an allocation to
its statutory reserve fund from its after-tax profit, it may make an allocation to its discretionary reserve
fund from its after-tax profit upon a resolution approved at the shareholders’ meeting.
Remedies of Company
According to the PRC Company Law, if a director, supervisor or senior management in
carrying out his duties infringes any law, administrative regulation or the articles of association of a
company, which results in damage to the company, that director, supervisor or senior management
should be responsible to the company for such damages.
Dividend
Under the PRC Company Law, the residual after-tax profits after a company has made up its
losses and accrued reserve shall be distributed by the company in proportion to the shares held by its
shareholders, except as otherwise provided for in the articles of association.
Fiduciary Duties
Under the PRC Company Law, directors, supervisors, managers and other senior management
personnel of a company have the duty of loyalty and diligence to the company. Such persons shall
abide by the articles of association of the company, perform their duties honestly and diligently,
safeguard the interests of the company, and shall not use their position and authority in the company
for their personal gain.
Closure of Register of Members
According to the PRC Company Law, the register of shareholders shall not be modified within
20 days before any shareholders’ meeting is held, or within 5 days prior to the benchmark date decided
by the company for the distribution of dividends. Where it is otherwise provided for in any law,
administrative regulation or by the security’s regulatory authority of the State Council for the
modification of the register of shareholders of a listed company, such provisions shall prevail.


--- page 514 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
This Appendix contains the summary of the principal provisions of the Articles of
Association adopted by our Company on June 25, 2023. The Articles of Association of the
Company shall take effect on the date of the H Shares being listed on the Stock Exchange. The
main purpose of this Appendix is to provide an overview of the Company’s Articles of Association
for potential investors, so it may not contain all the information of importance to potential
investors. The Articles of Association is available for inspection in the section headed “Appendix
VII — Documents Delivered to the Registrar of Companies and Available on Display”.
1. SHARES, REGISTERED CAPITAL AND TRANSFER OF SHARES
The Company’s stock takes the form of Shares. The par value of each Share issued by the
Company is RMB1.
The shares of the Company shall be issued in accordance with the principles of open, fairness
and justice. Each share of the same class shall have the same rights. Shares of the same class and in the
same issue shall be issued on the same conditions and at the same price. Any entity or individual shall
pay the same price for each of the Shares it/he/she subscribes for.
Unless otherwise specified in relevant laws, administrative regulations and by the listing rules
of the place where the Company’s Shares are listed, the paid-up shares of the Company can be freely
transferred in accordance with relevant laws and are not subject to any lien. The transfer of shares shall
be registered with the stock registration institution entrusted by the Company.
The Company does not accept Shares as the subject of pledges.
The Shares of the Company held by the promoters shall not be transferred within one year from
the date of establishment of the Company. The Shares of the Company issued prior to the public offer
shall not be transferred within one year from the date when the Company’s Shares are listed for trading
on a stock exchange.
The Directors, Supervisors and senior management of the Company shall declare to the
Company the number of Shares held by them and the alternation of such Shares. During their term of
office, they shall not transfer more than 25% of the Company’s Shares held by them within one year,
or shall not transfer any Shares of the Company within one year from the date when the Company’s
Shares are listed for trading. The aforesaid personnel shall not transfer any Share held by them within
six months of their resignation. Where there are any transfer restriction involving H Shares under the
listing rules of the place where the Company’s Shares are listed, the provisions under such listing rules
shall apply.
The Company or its subsidiaries shall not provide any financial assistance in the form of
donation, advancement, guarantee, compensation, loan or otherwise to investors or prospective
investors of the Shares of the Company.
2. INCREASE AND DECREASE OF SHARES AND REPURCHASE OF SHARES
(1) Increase of Capital
In light of the Company’s operational and developmental needs, the Company may increase its
capital in accordance with relevant laws and administrative regulations and subject to relevant
V-1


--- page 515 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
requirements of the Article of Association and a resolution of the general meeting, by any of the
following methods:
(i) a public offering of shares;
(ii) allotment of new shares to investors in private placements;
(iii) allotment of bonus shares to existing shareholders;
(iv) conversion of capital reserve to share capital; or
(v) other methods permitted by laws and administrative regulations and approved by relevant
authorities.
(2) Reduction of Capital
The Company may decrease its registered capital. If the Company decreases its registered
capital, it shall undertake relevant procedures in accordance with the Company Law, other relevant
administrative regulations and the Articles of Association.
(3) Repurchase of Shares
The Company shall not repurchase its Shares expect for the following circumstances:
(i) to decrease the registered capital of the Company;
(ii) to merge with other companies that hold shares in the Company;
(iii) to issue Shares for employee shareholding schemes or as share incentives;
(iv) to request the Company to acquire the Shares from shareholders who have voted against
the resolutions adopted at a general meeting of Shareholders on the merger or division of
the Company;
(v) to satisfy the conversion of the convertible corporate bonds issued by the Company with
Shares;
(vi) to safeguard corporate value and Shareholders’ equity as the Company deems necessary;
or
(vii) other circumstances permitted by relevant laws, administrative regulations and the listing
rules of the place where the Company’s Shares are listed.
The Company repurchasing its own Shares under any of the circumstances set forth in (i) and
(ii) of above shall be approved by the general meeting; and the Company repurchasing its own Shares
under any of the circumstances set forth in (iii), (v) and (vi) above may be approved by more than
two-thirds of Directors present at a Board meeting pursuant to the Articles of Association or the
authorization of the general meeting.
After repurchasing its own Shares pursuant to the provisions of the preceding paragraph, the
Company shall, under the circumstance set forth in (i) above, cancel such Shares within 10 days after
the purchase; while under the circumstance set forth in (ii) or (iv) above, the Company shall transfer or
cancel such Shares within six months; while under the circumstance set forth in (iii), (v) and
(vi) above, the Company shall not hold more than 10% of the outstanding Shares of the Company, and
shall transfer or cancel such Shares within three years.
V-2


--- page 516 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
3. REGISTER OF MEMBERS
The Company shall have a register of members in accordance with the certificates provided by
the securities registration institution. The register of members shall be the sufficient evidence of the
holding of Shares in the Company by a Shareholder.
The Company may, in accordance with the mutual understanding and agreements made
between the PRC securities regulatory authorities and overseas securities regulatory authorities, keep
its register of holders of overseas-listed foreign shares outside of the PRC and appoint overseas
agent(s) to maintain such register. The original register of holders of H shares shall be maintained in
Hong Kong.
The Company shall maintain a duplicate of the register of holders of overseas-listed foreign
shares at its place of domicile. The designated overseas agent(s) shall ensure consistency between the
original version and the duplicate register of holders of overseas-listed foreign shares at all times. If
there is any inconsistency between the original and the duplicate register of holders of overseas-listed
foreign shares, the original version shall prevail.
The Company shall maintain a complete register of members. The register of members shall
include the following parts:
(i) the register of members which is maintained at the Company’s place of domicile (other
than those registers set forth in paragraphs (ii) and (iii) of this Article);
(ii) the register of members in respect of the holders of overseas-listed foreign shares of the
Company which is maintained at the place where the overseas stock exchange on which
the shares are listed is located; and
(iii) the register of members which is maintained in such other place as the Board of Directors
may consider necessary for the purpose of listing of the Company’s shares.
When the Company intends to convene a general meeting, distribute dividends, enter into
liquidation and engage in other activities that require determination of shareholdings, the Board of
Directors or the convenor of a general meeting shall determine a specific date as equity determination
date. The registered shareholders after the market close of the equity determination date shall be the
shareholders entitled to the relevant rights and interests.
4. RIGHTS AND OBLIGATIONS OF THE SHAREHOLDERS
Shareholders shall enjoy rights and assume obligations according to the class of Shares held by
them. Shareholders holding the same class of Shares shall enjoy equal rights and assume the same
obligations.
Where the shareholder of the Company is a legal person, its legal representative or a person
authorized by the legal representative shall exercise its rights on its behalf.
Shareholders of ordinary shares of the Company shall enjoy the following rights:
(i) to receive dividends and other forms of profit distribution in proportion to the number of
Shares held by them;
(ii) to request, convene, host, attend or appoint proxies to attend general meetings and exercise
voting rights based on the number of the Shares held by them in accordance with laws;
V-3


--- page 517 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
(iii) to supervise the operation of the Company and to make proposals or raise inquiries;
(iv) to transfer, bestow, or pledge the Shares held by them in accordance with relevant laws,
administrative regulations, the listing rules of the place where the Company’s Shares are
listed and the Articles of Association;
(v) to check the Articles of Association, the registers of shareholders, the corporate bond
counterfoils, minutes of the general meetings, resolutions of meetings of the Board of
Directors and the Supervisory Committee and financial statements.
(vi) in the event of the termination or liquidation of the Company, to participate in the distribution
of the residual property of the Company in proportion to the number of Shares held;
(vii) to demand the Company to repurchase their Shares (for Shareholders who disagree with
the resolutions adopted at a general meeting in relation to the merger or division of the
Company); and
(viii) to have other rights conferred in accordance with relevant laws, administrative
regulations, rules, the listing rules of the place where the Company’s Shares are listed or
the Articles of Association.
Shareholders of ordinary shares of the Company shall have the following obligations:
(i) to comply with laws, administrative regulations, the listing rules of the place where the
Company’s Shares are listed and the Articles of Association;
(ii) to pay the share subscription price based on the shares subscribed for by them and the
method of acquiring such shares;
(iii) not to withdraw Shares unless otherwise prescribed in laws and administrative regulations;
(iv) not to abuse shareholders’ rights to infringe upon the interests of the Company or other
shareholders; not to abuse the Company’s status as an independent legal entity or the
limited liability of shareholders to harm the interests of the Company’s creditors; and
(v) to assume other obligations required by laws, administrative regulations, the listing rules
of the place where the Company’s Shares are listed and the Articles of Association.
Any shareholder who abuses shareholders’ rights and causes the Company or other
Shareholders to suffer a loss shall be liable for making compensation in accordance with the law. Any
Shareholder who abuses the status of the Company as an independent legal entity or the limited
liability of shareholders to evade debts and severely harm the interests of the Company’s creditors shall
assume joint and several liability for the Company’s debts.
Shareholders shall not be liable to make any further contributions to the share capital other than
those contributions made in accordance with the terms agreed by the subscribers at the time of share
subscription.
5. GENERAL MEETING
(1) General Rules for the General Meeting
The general meeting is the governing body of the Company and may exercise the following
functions and powers:
(i) to decide on the operating policies and investment plans of the Company;
V-4


--- page 518 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
(ii) to elect and remove directors or supervisors respectively other than a director or supervisor
who is an employee representative; and to decide matters relating to their remuneration;
(iii) to review and approve reports of the Board of Directors;
(iv) to review and approve reports of the Supervisory Committee;
(v) to review and approve the annual financial budgets and final accounts of the Company;
(vi) to review and approve the profit distribution plans and loss recovery plans of the
Company;
(vii) to adopt resolutions on the increase or decrease of the registered capital of the Company;
(viii) to adopt resolutions on the merger, division, dissolution, liquidation or change in
corporate form of the Company;
(ix) to adopt resolutions on the issuance of corporate bonds or other securities and listing of
such bonds or securities;
(x) to adopt resolutions on the engagement, renewal or non-renewal, or change of accounting
firms by the Company;
(xi) to amend the Articles of Association;
(xii) to review and approve the guarantee matters specified in the following Article;
(xiii) to review and approve the purchase or the sale of assets by the Company within one year,
the amount of which exceeds 30% of the latest audited total assets of the Company;
(xiv) to review and approve the changes in the use of proceeds;
(xv) to review the equity incentive scheme and employee shareholding plan; and
(xvi) to review other matters that required to be resolved by the general meeting as prescribed
by relevant laws, administrative regulations, rules, the listing rules of the place where the
Company’s Shares are listed and the Articles of Association.
The following external guarantees to be provided by the Company shall be approved by
shareholders at the general meeting:
(i) any provision of guarantee, where the total amount of external guarantees provided by the
Company and its subsidiaries exceeds 50% of the latest audited net assets of the Company;
(ii) any guarantee provided by the Company after the aggregate amount of guarantee exceeds
30% of the latest audited total assets of the Company;
(iii) any guarantee, the amount of which on a cumulative basis for twelve consecutive months,
exceeds of 30% of the latest audited total assets of the Company;
(iv) provision of guarantee to anyone whose liability-asset ratio exceeds 70%;
(v) provision of a single guarantee the amount of which exceeds 10% of the latest audited net
assets;
(vi) provision of guarantee to Shareholders, actual controllers and their connected parties.
General meetings include annual general meetings and extraordinary general meetings. The
annual general meeting shall be convened once a year and shall be held within six months after the end
of the preceding fiscal year.
V-5


--- page 519 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
The Board shall convene an extraordinary general meeting within two months upon the
occurrence of any of the following events:
(i) when the number of Directors is less than the minimum number required by the PRC
Company Law or less than two-thirds of the number prescribed in the Articles of
Association;
(ii) when the unrecovered losses of the Company have reached one-third of the Company’s
total amount of paid-up share capital;
(iii) when Shareholders who individually or jointly holding more than 10% of the Company’s
Shares with voting rights request in writing to convene an extraordinary general meeting;
(iv) when the Board of Directors deems it necessary to convene the meeting;
(v) when the Supervisory Committee proposes to convene a meeting;
(vi) when two or more independent directors proposes to hold a meeting; or
(vii) any other circumstances as specified by relevant laws, administrative regulations, rules,
the listing rules of the place where the Company’s Shares are listed and the Articles of
Association.
(2) Proposal and Convening of General Meetings
Independent directors shall be entitled to make a proposal to the Board of Directors on
convening an extraordinary general meeting. The Board of Directors shall give a written reply on
whether it agrees to convene such meeting within 10 days upon receipt of the proposal in accordance
with relevant laws, administrative regulations, the listing rules of the place where the Company’s
Shares are listed and the Articles of Association. Where the Board of Directors agrees to convene an
extraordinary general meeting, it shall serve a general meeting notice within 5 days after the date of the
resolution of the Board of Directors; where the Board of Directors declines to convene an
extraordinary general meeting, it shall give the reasons and make an announcement.
The Supervisory Committee shall be entitled to make a proposal in writing to the Board of
Directors on convening an extraordinary general meeting. The Board of Directors shall give a written
reply on whether it agrees to convene such meeting within 10 days upon receipt of the proposal in
accordance with relevant laws, administrative regulations, the listing rules of the place where the
Company’s Shares are listed and the Articles of Association.
Where the Board of Directors agrees to convene the extraordinary general meeting, it shall
serve a notice of convening the general meeting within 5 days after the date of the resolution of the
Board of Directors. Any changes made to the original proposal in the notice shall be agreed by the
Supervisory Committee.
Where the Board of Directors disagrees to convene such a meeting, or fails to reply within 10
days upon receipt of the proposal, it shall be deemed that the Board of Directors cannot or does not
perform its duty of convening the general meeting, and the Supervisory Committee may convene and
preside over it by itself.
Shareholder(s) individually or in aggregate holding more than 10% of Shares (on a “one Share
one vote” basis) with voting rights of the Company are entitled to request the Board of Directors in
writing to convene an extraordinary general meeting. The Board of Directors shall, in accordance with
V-6


--- page 520 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
the requirements of laws, administrative regulations and the Articles of Association, reply with a
written opinion to state whether it agrees to convene an extraordinary general meeting within 10 days
upon receipt of the request.
Where the Board of Directors agrees to convene the extraordinary general meeting, it shall
issue a notice of convening the general meeting within 5 days after the date of the resolution of the
Board of Directors. Any changes made to the original proposal in the notice shall be agreed by the
relevant Shareholders.
Where the Board of Directors disagrees to convene the extraordinary general meeting, or does
not reply within 10 days upon receipt of the proposal, Shareholders individually or in aggregate
holding more than 10% of the Shares of the Company are entitled to request the Supervisory
Committee in writing to convene an extraordinary general meeting.
Where the Supervisory Committee agrees to convene the extraordinary general meeting, it shall
issue a notice of convening the general meeting within 5 days upon receiving the request. Any changes
made to the original proposal in the notice shall be agreed by the relevant Shareholders.
If the Supervisory Committee fails to issue a notice of general meeting within the prescribed
time limit, it shall be deemed that the Supervisory Committee does not convene and preside over the
general meeting, and Shareholders holding individually or in aggregate more than 10% of the Shares of
the Company for more than 90 consecutive days can convene and preside over the general meeting by
themselves.
Where the Supervisory Committee or Shareholders decide to convene a general meeting on
their own, they must notify the Board of Directors in writing. Before the announcement of the
resolution of the general meeting is made, the Shareholders convening the meeting shall hold no less
than 10% of the Shares.
(3) Proposals of General Meetings
When the Company holds a general meeting, the Board of Directors, the Supervisory
Committee and Shareholders individually or jointly holding no less than 3% of the Shares with voting
rights of the Company shall have the right to make proposals to the Company.
A shareholder individually or shareholders jointly holding no less than 3% of the Shares with
voting rights of the Company may submit extempore motions in writing to the convenor 10 days prior
to the date of general meeting. The convenor shall issue a supplemental notice of general meeting and
make a public announcement of the contents of such extempore motion within 2 days after receipt of
the motion, and submit such extempore motion to the general meeting for consideration. The contents
of such extempore motion shall fall within the authority of general meetings, with definite topics to
discuss and specific matters to resolve.
Except as provided in the preceding paragraph, the convenor, after issuing the notice of the
general meeting, shall neither modify the proposals stated in the notice of general meetings nor add
new proposals.
(4) Notices of General Meetings
Where a general meeting is convened by the Company, it shall issue a notice 20 days prior to
the convening of the annual general meeting or 15 days prior to the convening of the extraordinary
V-7


--- page 521 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
general meeting to notify shareholders. When calculating the starting date, the date of the meeting shall
be excluded. The notice shall be issued in writing, and include date, time and venue of the meeting and
matters to be considered at the meeting and a statement indicating that shareholders are entitled to
appoint proxies to attend and vote at such meeting on his/her behalf in writing.
Notice of general meeting shall be served to all shareholders (whether they have voting right at
general meeting or not) either by hand or by post in a prepaid mail, addressed to each shareholder at
his/her/its registered address as shown in the register of members, or by public announcement. For
holders of domestic Shares, the notice of a general meeting may also be given by public
announcement.
(5) Convening of General Meetings
All the shareholders registered on the date of equity registration or their agents shall be entitled
to attend the general meeting and exercise his/her voting right in accordance with relevant laws,
administrative regulations, the listing rules of the place where the company’s Shares are listed and the
Articles of Association. Any Shareholder entitled to attend and vote at a general meeting shall have the
right to appoint one or more persons (who may not be a shareholder) as his/her proxies to attend, speak
and vote on his/her behalf.
The chairman of the Board of Directors shall convene a general meeting and serve as the
chairman of the meeting. If the chairman of the Board of Directors fails or is unable to perform his/her
duties, the meeting shall be convened and presided by the vice chairman (or if the Company has two or
more vice-chairmen, the one jointly elected by an absolute majority of directors shall convene and
preside) of the board of directors, if the Company does not have a vice chairman or the vice chairman
of the Board of Directors fails or is unable to perform his/her duties, the meeting shall be convened and
presided over by the director jointly elected by more than half of the Directors.
If the Board of Directors fails or is unable to perform its duty to convene the general meeting,
the Supervisory Committee shall convene and preside the general meeting. If the chairman of the
Supervisory Committee is unable or fails to perform such duties, the vice chairman shall preside over
the meeting. If the vice chairman is unable or fails to perform such duties, a supervisor jointly elected
by more than half of Supervisors shall preside over the meeting.
(6) Voting and Resolutions of General Meeting
Resolutions of the general meeting include ordinary resolutions and special resolutions.
Ordinary resolution at a general meeting shall be adopted by more than half of the voting rights of the
shareholders (including proxies) present at the meeting. Special resolution at a general meeting shall be
adopted by no less than two-thirds of the voting rights of the shareholders (including proxies) present
at the meeting.
Shareholders (including proxies) shall exercise their voting rights according to the number of
Shares with voting rights they represent, with one vote for each share. Shares in the Company which
are held by the Company do not have any voting rights, and shall not be counted in the total number of
Shares with voting rights represented by shareholders present at a general meeting.
The following matters shall be adopted by ordinary resolutions at the general meeting:
(i) the work reports of the Board of Directors and the Supervisory Committee;
V-8


--- page 522 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
(ii) the profit distribution and loss recovery plans proposed by the Board of Directors;
(iii) the election and removal of the members of the Board of Directors and the Supervisory
Committee (except for supervisors who are employee representatives);
(iv) the remuneration and method of payment of the members of the Board of Directors and
the Supervisory Committee;
(v) the annual budget and final account of the Company;
(vi) the annual reports of the Company; and
(vii) other matters, except those required to be adopted by special resolutions in accordance
with relevant laws, administrative regulations, the listing rules of the place where the
Company’s Shares are listed or the Articles of Association.
The following matters shall be adopted by special resolutions at the general meeting:
(i) the increase or decrease of the registered capital of the Company;
(ii) the division, merger, dissolution, and liquidation or change in the corporate form of the
Company;
(iii) any amendment to the Articles of Association;
(iv) any purchase or disposal of any material assets or guarantee within one year, the amount
of which exceeds 30% of the latest audited total assets;
(v) equity incentive schemes; and
(vi) any other matters which are required to be adopted by special resolutions in accordance
with relevant laws, administrative regulations, the listing rules of the place where the
Company’s Shares are listed or the Articles of Association, or which the general meeting
considers will have a material impact on the Company and therefore require to be adopted
by special resolutions by ordinary resolutions.
6. DIRECTORS AND BOARD OF DIRECTORS
(1) Directors
Directors shall be elected or removed at the general meeting. The term of office of a director is
three years, and upon expiry of the term of office, a director may be re-elected and re-appointed.
The term of office of the Directors shall be counted from the date of appointment until the
expiration of the term of the current Board of Directors. When the Directors’ term expires and
re-election is not held in time, or where the resignation of a director during his/her term of office
causes the number of board members to be less than the quorum, the original Directors shall still
perform their duties as Directors in accordance with relevant laws, administrative regulations, rules, the
listing rules of the place where the Company’s Shares are listed or the Articles of Association before
the re-elected Directors take office.
A Director shall not be required to hold any Share of the Company.
(2) Board of Directors
The Company shall set up a board of directors which shall be accountable to the general
meetings. The Board of Directors shall consist of fifteen directors. At least one-third of member of the
V-9


--- page 523 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
Board of Directors of the Company shall be the independent non-executive Directors and the number
of the independent non-executive Directors shall not be less than three.
The Board of Directors shall exercise the following functions and powers:
(i) to convene general meetings and report to the general meetings;
(ii) to implement resolutions of the general meetings;
(iii) to determine on the Company’s business plans and investment plans;
(iv) to formulate the annual financial budgets and final accounts of the Company;
(v) to formulate the Company’s profit distribution plans and plans for recovery of losses of
the Company;
(vi) to formulate proposals for the increase or decrease of the Company’s registered capital,
the issuance of bonds or other securities of the Company and the listing;
(vii) to draft proposals for the Company’s merger, division, dissolution or change of
corporate form;
(viii) to draft proposals for the Company’s major acquisitions and sale, and repurchase of
Shares of the Company;
(ix) within the scope authorized by the general meeting, to decide the Company’s external
investments, acquisition and disposal of assets, provision of security on the Company’s
assets, provision of guarantee, entrusted investment, related party transactions and
donations etc.;
(x) to decide on establishment of internal management structure of the Company;
(xi) to decide the establishment of committees of the Board of Directors; appoint or remove
chairman (convenor) of the committees of the Board of Directors;
(xii) to appoint or remove the Company’s general manager and secretary of the Board of
Directors, company secretary; to appoint or remove senior management including
deputy general manager(s) and the person in charge of finance of the Company in
accordance with the nominations by general manager, and to determine their
emoluments, rewards and penalties;
(xiii) to establish the basic management system of the Company;
(xiv) to formulate proposals for the amendment to the Articles of Association;
(xv) to formulate proposals to adopt share incentive plan of the Company;
(xvi) to manage the information disclosures of the Company;
(xvii) to propose to the general meeting the appointment or change of the accounting firm that
provides audit service of annual financial statement to the Company;
(xviii) to review work reports submitted by the general manager of the Company and examine
his/her work;
(xix) to decide material matters and administrative matters other than those matters required
to be approved by the general meeting of the Company in accordance with relevant
laws, administrative regulations, rules, the Article of Association and the listing rules of
the place where the Company’s Shares are listed; and
V-10


--- page 524 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
(xx) other duties and powers stipulated by relevant laws, administrative regulations, rules,
the listing rules of the place where the Company’s Shares are listed and the Articles of
Association, and conferred at general meetings.
The Board meeting includes regular meetings and extraordinary meetings. The Board of
Directors shall hold a regular meeting at least four times a year. A regular Board meeting shall be
convened by the chairman of the Board and notices of the regular Board meeting shall be sent to all
Directors and Supervisors at least fourteen days prior to the date of the meeting.
Unless otherwise specified in our Articles of Association, a meeting of the Board of Directors
shall only be held if it has a quorum of more than half of the directors. Resolutions adopted at the
Board meeting must be approved by more than half of all members of the Directors, unless otherwise
required in our Articles of Association. Resolutions of the Board shall be passed on a “one person one
vote” basis. In the event that the votes for and against a resolution are equal, the chairman of the Board
shall be entitled to one additional vote.
If any director is associated with the enterprises that are involved in the matters to be resolved
at the meeting of the Board of Directors, he or she shall not exercise his/her voting rights for such
matters, nor shall such director exercise voting rights on behalf of other directors. Such meeting of the
Board of Directors may be held only if more than half of the directors without a connected relationship
are present, and the resolutions made at such a meeting of the Board of Directors shall be passed by
more than half of the directors without a connected relationship. If the number of non-connected
directors present at such meeting is less than three, the matter shall be submitted to the general meeting
for consideration.
7. SECRETARY OF THE BOARD
The Company shall have a secretary of the Board of Directors. The secretary of the Board of
Directors is a member of the senior management of the Company. The secretary of the Board of
Directors of the Company shall be a natural person with the requisite professional knowledge and
experience and shall be appointed by the Board of Directors.
Any Director or any other senior management of the company may serve as the secretary of the
Board of Directors concurrently. The accountant from the accounting firm engaged by the Company
shall not concurrently serve as the secretary to the Board of Directors of the Company.
8. GENERAL MANAGER AND OTHER SENIOR MANAGEMENT
The Company has one general manager, several deputy general managers, and one person in
charge of finance, and they shall be appointed or removed by the Board of Directors.
Directors may concurrently serve as general manager or other senior management.
The general manager shall be accountable to the Board of Directors and exercise the following
functions and powers:
(i) to be in charge of the production, operation and management of the Company, and to
report his/her works to the Board of Directors;
V-11


--- page 525 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
(ii) to organize the implementation of the resolutions of the Board of Directors;
(iii) to organize the implementation of the Company’s annual business plans and investment
plans;
(iv) to draft plans for the establishment of the Company’s internal management organization;
(v) to draft plans for the establishment of the Company’s branches;
(vi) to draft the Company’s basic management system;
(vii) to formulate the Company’s basic administrative regulations;
(viii) to propose the appointment or removal of the Company’s deputy general manager,
person in charge of finance or other senior management;
(ix) to appoint or dismiss management personnel other than those required to be appointed or
dismissed by the Board of Directors; and
(x) such other powers conferred by the Articles of Association or the Board of Directors.
9. SUPERVISORY COMMITTEE
The Company shall establish a Supervisory Committee. The Supervisory Committee shall
consist of three supervisors, one of which shall be the chairman. The term of office of each supervisor
shall be a period of three years, renewable upon re-election. Any directors, general managers and other
senior management shall not act concurrently as supervisors.
Shareholders’ representative supervisors shall be elected and removed by the general meeting,
the employee representative supervisor shall be elected and removed by the employees of the
Company democratically and which shall not be less than one-third of the members of the Supervisory
Committee.
The Supervisory Committee shall be accountable to the general meeting and exercise the
following functions and powers in accordance with laws:
(i) to review and express its view in writing on periodic reports prepared by the Board;
(ii) to monitor the Company’s financial matters;
(iii) to supervise the related acts of any of the directors and senior management to ensure that
there is no violation of relevant laws, administrative regulations, the listing rules of the
place where the Company’s Shares are listed, and the Articles of Association of the
Company during their performance of the duties to the Company; to propose the removal
of the directors and senior management who violates any laws, administrative
regulations, the listing rules of the place where the Company’s Shares are listed, the
Articles of Association of the Company or the resolutions passed by the general meeting;
(iv) to demand any Directors and senior management who acts in a manner which is
detrimental to the Company’s interests to rectify such behavior;
(v) to propose the convening of extraordinary general meetings; to convene and preside the
general meetings in the event that the Board of Directors fails to perform its duties to
convene and preside the general meetings;
(vi) to make proposals to the general meetings;
V-12


--- page 526 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
(vii) to negotiate with or bring actions against Directors and senior management on behalf of
the Company in accordance with the PRC Company Law;
(viii) to investigate any abnormal matters during the business operation of the Company; if
necessary, to engage professionals such as accounting firms or law firms to assist the
investigation in exercising its functions and powers with expenses being borne by the
Company; and
(ix) other powers provided in the Articles of Association.
Resolutions of Supervisory Committee shall be passed by no less than two-thirds of the
Supervisors.
10. QUALIFICATIONS OF THE DIRECTORS, SUPERVISORS, AND SENIOR
MANAGEMENT OF THE COMPANY
A person may not serve as a Director, Supervisor, or other senior management of the Company
if such person:
(i) has no civil capacity or has limited civil capacity;
(ii) was sentenced for the offense of corruption, bribery, expropriation, misappropriation of
property or for disrupting the social and economic order, and less than five years has
elapsed since the sentence was served, or has been deprived of political rights due to such
crimes, and less than five years has elapsed since the deprivation was completed;
(iii) has served as a director, factory manager or general manager of a company or enterprise
that was bankrupted and liquidated, and was personally liable for the bankruptcy of such
company or enterprise, and less than three years has elapsed since the date of completion
of the bankruptcy and liquidation of that company or enterprise;
(iv) was a former legal representative of a company or an enterprise which has had its business
license revoked and been ordered to close down its business for violating the laws, and
was personally liable for that revocation, and less than three years has elapsed since the
date of revocation;
(v) has comparatively large amount of individual debts that have become overdue and have
not been settled; or
(vi) where other contents stipulated by laws, administrative regulations, rules and the listing
rules of the place where the Company’s Shares are listed.
11. FINANCIAL AND ACCOUNTING SYSTEMS
The Company shall formulate its financial and accounting systems in accordance with relevant
laws, administrative regulations, the listing rules of the place where the Company’s Shares are listed
and the PRC accounting standards formulated by relevant authorities.
The Company shall prepare financial reports at the end of each fiscal year. Such reports shall be
audited in accordance with the law.
The Company shall, according to relevant laws and administrative regulations of the place
where the Company’s Shares are listed, the listing rules of the stock exchange and other normative
documents, submit and/or disclose the annual report, interim report, announcement of performance and
other documents to the Shareholders.
V-13


--- page 527 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
The financial statements of the Company shall be prepared not only in accordance with PRC
accounting standards and administrative regulations, but also in accordance with international
accounting standards or the accounting standards of the place outside the PRC where Shares of the
Company are listed. If there are major differences in the financial statements prepared in accordance
with these two sets of accounting standards, such differences shall be stated in notes appended to such
financial statements.
12. PROFIT DISTRIBUTIONS
Where the Company distributes its after-tax profits for a given year, it shall allocate 10% of the
profits to its statutory reserve.
The Company shall no longer be required to make allocations to its statutory reserve once the
aggregate amount of such reserve reaches at least 50% of its registered capital.
If the Company’s statutory reserve is insufficient to make up losses from previous years, the
Company shall use its profits from the current year to make up such losses before making the
allocation to its statutory reserve in accordance with the preceding paragraph.
After making the allocation from its after-tax profits to its statutory reserve, the Company may,
subject to a resolution of the general meeting, make an allocation from its after-tax profits to the
discretionary reserve.
After the Company has made up its losses and made allocations to its reserves, the remaining
profits of the Company shall be distributed in proportion to the shareholdings of its shareholders,
unless otherwise specified by the Articles of Association.
If the general meeting or the Board of Directors breaches the provisions of the preceding
paragraphs by distributing profits to shareholders before the Company has made up its losses and made
allocations to the statutory reserve, the shareholders must return to the Company the profits that were
distributed in breach of the said provisions.
Shares of the Company that are held by the Company itself shall not participate in the
distribution of profits.
The Company shall appoint receiving agents for holders of overseas-listed foreign shares to
collect on behalf of the relevant shareholders the dividends distributed and other amount payable by
the Company in respect of overseas-listed foreign shares.
The receiving agents appointed by the Company shall meet the requirements of relevant laws of
the place or the relevant administrative regulations of the stock exchange where the Company’s Shares
are listed.
13. APPOINTMENT OF ACCOUNTING FIRM
The Company shall engage a qualified independent accounting firm to audit the Company’s
annual financial reports and to examine and verify other financial reports.
V-14


--- page 528 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
The term of service of an accounting firm engaged by the Company shall be the date from the end
of the current annual general meeting of the Company until the end of the next annual general meeting.
14. DISSOLUTION AND LIQUIDATION OF THE COMPANY
The Company shall be dissolved in accordance with the law under any of the following
circumstances:
(i) the expiration of the operation term as set force in the Articles of Association or the
occurrence of other events for dissolution as set forth in the Articles of Association;
(ii) the Shareholders’ general meeting resolves to dissolve the Company;
(iii) dissolution is necessary as a result of merger or division of the Company;
(iv) the Company’s business license is revoked or it is ordered to close down its business or
deregistered according to relevant laws;
(v) where the operation and management of the Company falls into serious difficulties and its
continued existence would cause material losses to the interests of the Shareholders, the
Shareholders holding more than 10% of the total voting rights of the Company may apply
to the People’s Court to dissolve the Company if there no other solutions.
Where the Company is dissolved under the circumstances set forth in (i), (ii), (vi) and (v) above,
it shall establish a liquidation committee and the liquidation shall commence within 15 days from the date
on which the cause for dissolution arose. The liquidation committee shall be composed of Directors or
persons determined by a general meeting. If the Company fails to establish the liquidation committee and
carry out the liquidation within the time limit, its creditors may apply to the People’s Court to designate
relevant persons to form a liquidation committee and carry out the liquidation.
After the liquidation committee has liquidated the Company’s property and prepared a balance
sheet and property list, it shall formulate a liquidation plan and submit such plan to the general meeting
or the People’s Court for confirmation. The Company’s property remaining after payment of the
liquidation expenses, the wages, social insurance premiums and statutory compensation of the
employees, the taxes owed and all the Company’s debts shall be distributed by the Company to the
shareholders in proportion to the Shares they hold.
During liquidation, the Company shall continue to exist but may not engage in any business
activities unrelated to the liquidation. The Company’s property will not be distributed to the
shareholders until the repayment of its debts in accordance with the preceding paragraph.
If the liquidation committee, having liquidated the Company’s property and prepared a balance
sheet and property list, discovers that the Company’s property is insufficient to pay its debts in full, it
shall apply to the People’s Court for a declaration of bankruptcy in accordance with the law. After the
People’s Court has ruled to declare the Company bankrupt, the liquidation committee shall turn over
the liquidation matters to the People’s Court.
Following the completion of liquidation of the Company, the liquidation committee shall
formulate a liquidation report, a revenue and expenditure statement and financial accounts in respect of
the liquidation period, submit the same to the general meeting or the People’s Court for confirmation,
and submit to the company registration authority to apply for company deregistration, and announce
the Company’s termination.
V-15


--- page 529 ---
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
15. AMENDMENT TO THE ARTICLES OF ASSOCIATION
The Company shall amend the Articles of Association in accordance with relevant laws,
administrative regulations, the listing rules of the place where the Company’s Shares are listed and the
Articles of Association. If any amendment to the Articles of Association involves matters requiring the
approval from the competent regulatory authority to become effective, it shall be submitted to the
competent regulatory authority for approval. If any amendment to the Articles of Association involves
any registered item of the Company, the Company shall complete the registration of the change in
accordance with the law.
V-16


--- page 530 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
A. FURTHER INFORMATION ABOUT OUR COMPANY AND OUR SUBSIDIARIES
1. Incorporation
Our Company was established as a limited liability company in the PRC on June 29, 2012 and
was converted into a joint stock limited company on June 24, 2019 under the laws of the PRC. As of
the Latest Practicable Date, the registered share capital of our Company was RMB69,392,473.
Our Company has established a place of business in Hong Kong at Room 1915, 19/F, Lee
Garden One, 33 Hysan Avenue, Causeway Bay, Hong Kong and has been registered as a non-Hong
Kong company in Hong Kong under Part 16 of the Companies Ordinance. Ms. Wong Wai Yee, one of
our joint company secretaries, has been appointed as our agent for the acceptance of service of process
in Hong Kong whose correspondence address is the same as our place of business in 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 V—Summary of the Articles of Association”. A
summary of certain relevant aspects of the laws and regulations of the PRC is set out in
“Appendix IV—Summary of Principal Legal and Regulatory Provisions”.
2. Changes in Share Capital
On June 29, 2012, our Company was incorporated with a registered capital of RMB1,000,000.
The following sets out the changes in the share capital of our Company during the two years
immediately preceding the date of this prospectus:
On June 21, 2023, pursuant to the capital increase agreements, the terms of which are
summarized in the paragraph headed “History, Development and Corporate Structure—Pre-IPO
Investments”, the total registered capital of our Company increased from approximately RMB66.61
million to approximately RMB69.39 million, among which Deyang Digital, Deyang Jinghua, Xinxin
Xiangrong and Hangzhou Fuyang subscribed for RMB0.16 million, RMB0.64 million,
RMB0.40 million and RMB1.59 million, respectively.
For more details, see “History, Development and Corporate Structure—Pre-IPO Investments”.
Save as aforesaid, as of the Latest Practicable Date, there had been no alterations of our share capital
within the two years preceding the date of publication of this prospectus.
3. Changes in Share Capital of Our Subsidiaries
A summary of the corporate information and the particulars of our subsidiaries as of the Latest
Practicable Date are set out in “Appendix I Accountant’s Report—Note 12 Subsidiaries”.
VI-1


--- page 531 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
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
Hangzhou Unisound ............................ P R C June 6, 2023 RMB100,000,000
Sichuan Unisound AI Technology Co., Ltd. (ٝ
ʮ̡ ........................ P R C June 21, 2023 RMB100,000,000
Beijing Zhuyun Shanhai Intelligent Technology Co.,
Ltd. (ʮ̡) ............ P R C November 15, 2023 RMB5,000,000
Henan Unisound Technology Co., Ltd. (߅
ʮ̡)................................. P R C January 17, 2024 RMB10,000,000
Beijing Zhuyun Shanhai Intelligent Technology Co.,
Ltd. (ʮ̡) ............ P R C November 15, 2023 RMB5,000,000
Henan Unisound Technology Co., Ltd. (߅
ʮ̡)................................. P R C January 17, 2024 RMB10,000,000
Jiangsu Unisound Technology Co., Ltd. (߅
ʮ̡)................................. P R C September 29, 2024 RMB10,000,000
Jiangsu Unisound Shanhai Technology Co., Ltd. ( Ϫᘽ
ʮ̡) ...................... P R C November 5, 2024 RMB10,000,000
Save as disclosed above and in the Accountant’s Report set out in Appendix I to this
prospectus, there has been no other 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
Pursuant to a general meeting held on June 25, 2023, among other things, our Shareholders
resolved that:
(a) the issuance by our Company of the H Shares of nominal value of RMB1.00 each and
such H Shares being listed on the main board of the Stock Exchange;
(b) the number of H Shares to be issued shall not be more than 25% of the total issued share
capital of our Company as enlarged by the Global Offering before the exercise of the
Over-allotment Option, and the grant to the underwriters (or their representatives) of the
Over-allotment Option of not more than 15% of the number of H Shares issued pursuant to
the Global Offering;
(c) subject to the completion of the Global Offering, the adoption of the Articles of
Association which shall become effective on the Listing Date, and authorization to the
Board to amend the Articles of Association for the purpose of the Company’s Listing; and
(d) authorization of the Board to handle all matters relating to, among other things, the Global
Offering, the issue and listing of the H Shares.
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 June 18, 2025 entered into among our
Company, SensePower Management Limited, China International Capital Corporation
VI-2


--- page 532 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
Hong Kong Securities Limited, Haitong International Capital Limited and Haitong
International Securities Company Limited, with respect to a subscription of H Shares at
the Offer Price in the amount of HK$43,698,177;
(b) a cornerstone investment agreement dated June 17, 2025 entered into among our
Company, Nebula Asset Management Limited, Cheng Nga Yin, China International
Capital Corporation Hong Kong Securities Limited, Haitong International Capital Limited
and Haitong International Securities Company Limited, with respect to a subscription of
H Shares at the Offer Price in the amount of HK$30,000,000;
(c) a cornerstone investment agreement dated June 18, 2025 entered into among our
Company, Runjian International (Hong Kong) Co., Limited (
ʮ̡),
China International Capital Corporation Hong Kong Securities Limited, Haitong
International Capital Limited and Haitong International Securities Company Limited, with
respect to a subscription of H Shares at the Offer Price in the amount of Hong Kong
dollars equivalent to RMB20,000,000 (inclusive of all brokerage, transaction levy and
trading fees); and
(d) the Hong Kong Underwriting Agreement.
2. Intellectual Property Rights
(a) Trademarks registered
As of the Latest Practicable Date, we had registered the following trademarks which we
consider to be or may be material to our business:
No. Trademark
Place of
Registration Registered Owner Class
Registered
Number
Expiry Date
(dd/mm/yyyy)
1.
 PRC Our Company 9 63056239 06/09/2032
2.
 PRC Our Company 9 50429659 13/06/2031
3.
 PRC Our Company 35 50429671 13/06/2031
4.
 PRC Our Company 42 50429701 27/06/2031
5.
 PRC Our Company 9 50314333 20/06/2031
6.
 PRC Our Company 9 50290260 13/06/2031
7.
 PRC Our Company 9 50298594 06/08/2031
8.
 PRC Our Company 42 38241696 06/02/2030
9.
 PRC Our Company 9 38247355 27/01/2030
10.
 PRC Our Company 42 38222388 20/01/2030
11.
 PRC Our Company 9 38223507 20/01/2030
12.
 PRC Our Company 9 37989329 27/06/2030
VI-3


--- page 533 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Trademark
Place of
Registration Registered Owner Class
Registered
Number
Expiry Date
(dd/mm/yyyy)
13.
 PRC Our Company 9 37983530 20/01/2030
14.
 PRC Our Company 9 37991589 20/08/2030
15.
 PRC Our Company 9 35976415 27/11/2029
16.
 PRC Our Company 9 31348841 13/07/2030
17.
 PRC Our Company 9 27073790 13/10/2028
18.
 PRC Our Company 9 27091814 20/12/2028
19.
 PRC Our Company 9 16913127 06/07/2026
20.
 PRC Our Company 42 14383739 27/05/2035
21.
 PRC Our Company 9 14383366 27/05/2035
22.
 PRC Our Company 35 14383398 27/05/2035
23.
 PRC Our Company 42 14383646 06/09/2035
24.
 PRC Our Company 42 14383715 13/06/2035
25.
 PRC Our Company 9 14383337 27/05/2035
26.
 PRC Our Company 9 14383352 06/09/2035
27.
 PRC Our Company 9 14043366A 06/06/2035
28.
 PRC Our Company 42 14043411 20/04/2035
(b) Copyrights registered
As at the Latest Practicable Date, we had registered the following copyrights which we
consider to be or may be material to our business:
No. Copyright
Place of
Registration Copyright Owner
Registration
Number
Registration
Date
(dd/mm/yyyy)
1. Unisound online real-time
high-performance speech
recognition server software
V1.0
ঐ
ਕኜழ΁V1.0
PRC Our Company 2013SR016729 25/02/2013
2. Unisound medical speech
recognition system Union
Medical College Hospital
customized version V1.0
ථ
ᗆйӻ୕՘
و
V1.0
PRC Unisound Information and
Chinese Academy of Medical
Sciences & Peking Union
Medical College
2016SR198817 29/07/2016
3. Unisound medical intelligent
voice system V3.0
ᑊᔼ
ӻ୕V3.0
PRC Our Company 2017SR244869 08/06/2017
VI-4


--- page 534 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Copyright
Place of
Registration Copyright Owner
Registration
Number
Registration
Date
(dd/mm/yyyy)
4. Unisound voice cloud
platform V3.0ථ
̨̻V3.0
PRC Our Company 2017SR515775 14/09/2017
5. Unisound resident doctor
workstation intelligent voice
input system 3.0
ᑊИ৫
፽ɝӻ
୕
3.0
PRC Our Company 2017SR716266 21/12/2017
6. Unisound outpatient doctor
workstation intelligent voice
input system 3.0
ൢ
፽ɝӻ
୕
3.0
PRC Our Company 2018SR016751 08/01/2018
7. Unisound mobile ward rounds
intelligent voice transcription
system V3.0
ݟ
ᔷᄳӻ୕V3.0
PRC Our Company 2018SR219544 29/03/2018
8. Unisound radiology
department intelligent voice
input system V3.0
׳
፽ɝӻ୕V3.0
PRC Our Company 2018SR219561 29/03/2018
9. Unisound doctor-patient
dialogue recording
transcription system V3.0
ᔷᄳӻ
୕V3.0
PRC Our Company 2018SR243782 11/04/2018
10. Unisound mobile nursing
intelligent voice transcription
system V3.0
ᑊ୅ਗᚐ
ᔷᄳӻ୕V3.0
PRC Our Company 2018SR243788 11/04/2018
11. Unisound inpatient nurse
station intelligent voice input
system V3.0
ᑊИ৫ᚐ
፽ɝӻ୕V3.0
PRC Our Company 2018SR272090 23/04/2018
12. Unisound intelligent
conference system V3.0 ථ
ᑊ౽ঐึᙄӻ୕V3.0
PRC Our Company 2018SR272098 23/04/2018
13. Unisound TCM specialist
intelligent voice input system
V3.0
౽ঐႧ
፽ɝӻ୕V3.0
PRC Our Company 2018SR272155 23/04/2018
14. Robot active interactive
response system V1.0 ዚኜ
ɛ˴ਗʹʝᏐഈӻ୕V1.0
PRC Shenzhen Unisound 2018SR317306 09/05/2018
15. Robot voice dialogue system
V1.0࿁༑ӻ
୕V1.0
PRC Shenzhen Unisound 2018SR317322 09/05/2018
VI-5


--- page 535 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Copyright
Place of
Registration Copyright Owner
Registration
Number
Registration
Date
(dd/mm/yyyy)
16. Unisound pathology
intelligent voice assistant V3.0
п
˓V3.0
PRC Our Company 2018SR400080 30/05/2018
17. Outpatient self-service
machine system V3.0ൢ
Іпዚӻ୕V3.0
PRC Our Company 2018SR491189 27/06/2018
18. Ultrasound intelligent assistant
conversational interaction
system V1.0
൴ᑊ౽ঐп˓
ʹʝӻ୕V1.0
PRC Our Company 2018SR684711 27/08/2018
19. Pre-diagnosis robot
conversational AI interaction
system V1.0
ཫൢዚኜɛ౽ঐ
ʹʝӻ୕V1.0
PRC Shanghai Unisound 2018SR767266 20/09/2018
20. Conversational AI pathology
system V1.0षଣ
ӻ୕V1.0
PRC Our Company 2019SR0178298 25/02/2019
21. Intelligent medical record
quality control system V1.0
౽ঐषዝሯછӻ୕V1.0
PRC Our Company 2019SR0183213 26/02/2019
22. Digu smart phone robot
system V1.1 ྑզ౽ঐཥ༑ዚ
ኜɛӻ୕V1.1
PRC Shanghai Unisound 2019SR0752712 19/07/2019
23. Congcong robot software (iOS
version) V1.0.7 ᑋᑋዚኜɛ
ழ΁iOSV1.0.7
PRC Our Company 2019SR0827736 09/08/2019
24. Congcong robot software
(Android version) V1.0.13
(
ᑋᑋዚኜɛழ΁
(AndroidوV1.0.13
PRC Our Company 2019SR0827744 09/08/2019
25. KAR operation platform
system V1.4.1 (KAR ༶ᐄ̨̻
ӻ୕V1.4.1
PRC Our Company 2019SR1160634 18/11/2019
26. Unisound skills open platform
V1.3.0̻
̨V1.3.0
PRC Our Company 2019SR1408368 20/12/2019
27. Unisound voice transcription
service system V1.0.0ٝ
ਕӻ୕V1.0.0
PRC Our Company 2019SR1408707 20/12/2019
28. Unisound authentication and
authorization center system
V1.0.0
ᑊႩᗇબᛆʕː
ӻ୕V1.0.0
PRC Our Company 2019SR1409194 20/12/2019
29. Conversational AI and visual
multi-modal ticketing system
V1.0
ʿൖᙂεᅼ࿒
ਯୃӻ୕V1.0
PRC Shanghai Unisound 2019SR1445489 27/12/2019
VI-6


--- page 536 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Copyright
Place of
Registration Copyright Owner
Registration
Number
Registration
Date
(dd/mm/yyyy)
30. Yunxiao cloud platform V1.0
ථወථ̨̻V1.0
PRC Shanghai Unisound 2020SR0425046 09/05/2020
31. Unisound user center software
V1.4.8ᑊ͜˒ʕːழ
΁V1.4.8
PRC Our Company 2020SR0550748 02/06/2020
32. Unisound energy management
platform V1.0ᑊঐ๕၍
ଣ̨̻V1.0
PRC Shanghai Unisound 2020SR0610727 11/06/2020
33. Chinese intelligence
evaluation public cloud
software V1.0
ʕ˖౽ঐ൙಻
ʮϞථழ΁V1.0
PRC Shanghai Unisound 2020SR0613680 12/06/2020
34. Unisound device center
software V1.2.7 (ᑊண௪ʕ
ːழ΁V1.2.7 )
PRC Our Company 2020SR0625116 15/06/2020
35. Unisound elevator control
mini program system V1.3 ( ථ
ᑊ૒છʃ೻ҏӻ୕V1.3)
PRC Shanghai Unisound 2020SR0692089 29/06/2020
36. Community intelligent
behavior recognition detection
system V1.0 (
ᗆ
йᏨ಻ӻ୕V1.0)
PRC Shanghai Unisound 2020SR0692104 29/06/2020
37. Intelligent obstetrics and
gynecology management
system V1.3.7 (
౽ঐ੉ପ၍ଣ
ӻ୕V1.3.7)
PRC Shanghai Unisound 2020SR0692162 29/06/2020
38. Word solitaire software V3.0.1
(൚ႧટᎲழ΁V3.0.1)
PRC Shanghai Unisound 2020SR0692303 29/06/2020
39. Intelligent follow-up system
V1.0 (౽ঐᎇஞӻ୕V1.0)
PRC Our Company 2020SR0792567 17/07/2020
40. Yunting intelligent conference
system V1.0 ( ථᛓ౽ঐึᙄӻ
୕V1.0)
PRC Shanghai Unisound 2020SR0961207 20/08/2020
41. Smart case field order system
V1.0 (ఊӻ୕V1.0)
PRC Shanghai Unisound 2020SR1026049 02/09/2020
42. Unisound smart bedside
interactive system V1.0 (ٝ
ʹʝӻ୕V1.0)
PRC Our Company 2020SR1209444 13/10/2020
43. Unisound intelligent
pre-diagnosis system V1.0 ( ථ
ᑊ౽ঐཫൢӻ୕V1.0)
PRC Our Company 2020SR1601556 18/11/2020
44. Unisound intelligent triage
system V1.0 (ᑊ౽ঐʱൢ
ӻ୕V1.0)
PRC Our Company 2020SR1601564 18/11/2020
45. Knowledge graph platform
V1.0 (ᗆྡᗅ̨̻V1.0)
PRC Our Company 2020SR1601565 18/11/2020
VI-7


--- page 537 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Copyright
Place of
Registration Copyright Owner
Registration
Number
Registration
Date
(dd/mm/yyyy)
46. Unisound intelligent diagnosis
system V3.0 (ᑊ౽ঐኬൢ
ӻ୕V3.0)
PRC Our Company 2020SR1601593 18/11/2020
47. Yunxiao intelligent
community information
management system V1.0 (
ථ
၍ଣӻ୕V1.0)
PRC Shanghai Unisound 2020SR1626528 23/11/2020
48. Diabetes management system
V1.0 (ጟ҇ष၍ଣӻ୕V1.0)
PRC Our Company 2020SR1637635 24/11/2020
49. Medical insurance intelligent
medical record review system
V1.0 (
ӻ
୕V1.0)
PRC Our Company 2021SR0194802 04/02/2021
50. Hospital safety (adverse) event
intelligent reporting system
V1.0 (
ᔼ৫τΌʔԄԫ΁౽
ঐజѓӻ୕V1.0)
PRC Our Company 2021SR0265123 20/02/2021
51. Intelligent medical record
quality control system -
operation management
platform V1.1.1 (
౽ঐषዝሯછ
ӻ୕— ༶Б၍ଣ̨̻V1.1.1)
PRC Our Company 2021SR0316758 01/03/2021
52. Medical record home page
management platform V1.1
(
၍ଣ̨̻V1.1)
PRC Our Company 2021SR0316759 01/03/2021
53. Intelligent medical record
quality control system-nursing
client V1.0 (
౽ঐषዝሯછӻ
୕—˒၌V1.0)
PRC Our Company 2021SR0372073 10/03/2021
54. Intelligent medical record
quality control system -
outpatient client V1.0 (
౽ঐष
ዝሯછӻ୕—˒၌V1.0)
PRC Our Company 2021SR0372074 10/03/2021
55. Smart work badge
management system V1.1 ( ౽
ᅆʈ೐၍ଣӻ୕V1.1)
PRC Shanghai Unisound 2021SR0633923 06/05/2021
56. DRG operation management
platform 1.0 (DRG ༶ᐄ၍ଣ̻
̨1.0)
PRC Our Company 2021SR0739946 21/05/2021
57. Single disease data reporting
system V1.0 ( ఊष၇ᅰኽɪజ
ӻ୕V1.0)
PRC Our Company 2021SR0884189 11/06/2021
58. Multi-modal smart interactive
large-screen software
(horizontal screen) V1.0 (
εᅼ
ழ΁ዑ

V1.0)
PRC Shanghai Unisound 2021SR0889041 15/06/2021
VI-8


--- page 538 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Copyright
Place of
Registration Copyright Owner
Registration
Number
Registration
Date
(dd/mm/yyyy)
59. Multi-modal smart interactive
large-screen software (vertical
screen) V1.0
εᅼ࿒౽ᅆʹ
V1.0
PRC Shanghai Unisound 2021SR0889124 15/06/2021
60. Operation verification
software V1.0ழ
΁V1.0
PRC Our Company 2021SR0914770 18/06/2021
61. Unisound speech recognition
service system v2.0ᑊ
ਕӻ୕v2.0
PRC Shanghai Unisound 2021SR0964750 29/06/2021
62. Natural language annotation
system V1.0 І್ႧԊᅺൗ
ӻ୕V1.0
PRC Our Company 2021SR0967427 30/06/2021
63. Elevator inspection intelligent
operation and maintenance
system V1.0
ཥ૒ԚᏨ౽ᅆ
༶ၪӻ୕V1.0
PRC Shanghai Unisound 2021SR1176405 10/08/2021
64. Unisound conversational AI
service platform software
V1.0
؂
ਕ̨̻ழ΁V1.0
PRC Shanghai Unisound 2021SR1464841 08/10/2021
65. Unisound natural language
synthesis service software
V1.0
؂
ਕழ΁V1.0
PRC Shanghai Unisound 2021SR1464997 08/10/2021
66. AI intelligent sparring
platform software V1.0
AI౽ঐ௑ᇖ̨̻ழ΁V1.0
PRC Shanghai Unisound 2021SR2176380 27/12/2021
67. Multi-modal anti-fraud public
normalization publicity
interactive station software
V1.0
εᅼ࿒ԣൟᗺʮ΍੬࿒
ෂʹʝ१ழ΁V1.0
PRC Shanghai Unisound 2022SR0484548 19/04/2022
68. Unisound smart home central
control screen system - light
luxury version V1.0
ᑊ
ӻ୕— Ⴠ੅
وV1.0
PRC Shanghai Unisound 2022SR0488301 19/04/2022
69. Intelligent elevator voice, face
recognition and behavior
analysis comprehensive
control software V1.0
౽ঐ
ʱ
ၝΥછՓழ΁
V1.0
PRC Shanghai Unisound 2022SR0488302 19/04/2022
70. Unisound medical knowledge
middle platform system V1.0
ᗆʕ̨ӻ
୕V1.0
PRC Our Company 2022SR0529514 26/04/2022
VI-9


--- page 539 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Copyright
Place of
Registration Copyright Owner
Registration
Number
Registration
Date
(dd/mm/yyyy)
71. Tertiary hospital rating
management system V1.0 ( ɧ
ॴᔼ৫ഃॴ൙ᄲ၍ଣӻ୕V1.0)
PRC Our Company 2022SR0990860 03/08/2022
72. Intelligent equipment
monitoring operation and
maintenance platform V1.0
(
౽ঐண௪္છ༶ၪ̨̻V1.0
PRC Shanghai Unisound 2022SR1027003 05/08/2022
73. Single disease process
management system ( ఊष၇ཀ
೻၍ଣӻ୕)
PRC Our Company 2022SR1372434 23/09/2022
74. Single disease index
evaluation system (ᅺ
൙ᄆӻ୕)
PRC Our Company 2022SR1499032 14/11/2022
75. Single disease quality control
platform (ఊष၇ሯછ̨̻)
PRC Our Company 2022SR1499033 14/11/2022
76. Knowledge graph editing
management platform (ᗆྡ
ᗅᇜ፨၍ଣ̨̻)
PRC Our Company 2022SR1499034 14/11/2022
77. Xinyu smart creation teaching
practice platform V1.0 (Ⴇ౽
௴઺ኪྼስ̨̻V1.0)
PRC Shanghai Unisound 2022SR1583909 18/12/2022
78. Department data quality
management system V1.0 (߅
ᅰኽሯඎ၍ଣӻ୕V1.0)
PRC Our Company 2023SR0201008 06/02/2023
79. DIP medical insurance
intelligent reminder system
V1.0 (DIP
౽ঐ౤፴ӻ
୕V1.0)
PRC Our Company 2023SR0201009 06/02/2023
80. DIP medical insurance
operation management system
V1.0 (DIP
༶ᐄ၍ଣӻ
୕V1.0)
PRC Our Company 2023SR0201132 06/02/2023
81. Medical insurance intelligent
audit system V1.0 (౽ঐᄲ
ӻ୕V1.0)
PRC Our Company 2023SR0201298 06/02/2023
82. DRG medical insurance
operation management system
V2.0 (DRG
༶ᐄ၍ଣӻ
୕V2.0)
PRC Our Company 2023SR0459713 11/04/2023
VI-10


--- page 540 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
(c) Patents
As of the Latest Practicable Date, we have registered the following patents which we
considered to be or may be material to our business:
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
1 A method and
system for
extracting key
part of a sentence
ٙ
ʿӻ୕
Invention
Patent
Our Company PRC CN201810995542.5 07/04/2023 07/04/2043
2 A method and
device for
processing sound
of specific
characters
֛
ج
ʿༀໄ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202010307655.9 07/04/2023 07/04/2043
3 A method and
device for
extracting
integral entity
relationship
ɓ
פڷ
ʿༀໄ
Invention
Patent
Our Company PRC CN201911038681.X 18/04/2023 18/04/2043
4 A method and
device for
identifying
dialogue
intent
ɓ၇࿁༑
ʿༀ
ໄ
Invention
Patent
Our Company PRC CN201911168331.5 18/04/2023 18/04/2043
5 A method and
device for
decoding
speech
༆ᇁ
ʿༀໄ
Invention
Patent
Our Company PRC CN201911179311.8 18/04/2023 18/04/2043
6 A method and
device for
standardizing
names of
operations
ɓ၇
˓ஔΤ၈ᅺ๟ʷ˙
ʿༀໄ
Invention
Patent
Our Company PRC CN202010147252.2 18/04/2023 18/04/2043
7 A method and
device for
stabilizing
controllable end-
to-end speech
synthesis
ɓ၇
၌Ց၌
ʿༀ
ໄ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202010275510.5 18/04/2023 18/04/2043
VI-11


--- page 541 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
8 A voice detection
method and its
device
ࠪ
ʿՉༀ
ໄ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202010339292.7 18/04/2023 18/04/2043
9 An accelerated
annotation
method and
device for multi-
rounds dialogue
corpus of human-
machine
interaction
ɓ၇
Σɛዚʹʝεቃ
̋஺ᅺ
ʿༀໄ
Invention
Patent
Our Company PRC CN201911212568.9 05/05/2023 05/05/2043
10 A security control
method and
device for Docker
engine users
rights
ɓ
၇DockerˏᏗ͜
τΌછՓ˙
ʿༀໄ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202010317593.X 05/05/2023 05/05/2043
11 A content
identification
method and
device
࢙
ʿༀໄ
Invention
Patent
Our Company PRC CN201911180749.8 26/05/2023 26/05/2043
12 A method and
device for
correcting text
errors
ɓ၇˖͉
ʿӻ୕
Invention
Patent
Our Company PRC CN202010225790.9 26/05/2023 26/05/2043
13 An image-
assisted system
on children
robots for
determining
direction of
sound source
ɓ
၇Յഁዚኜɛɪл
ᑊ๕
ӻ୕
Invention
Patent
Our Company PRC CN201911096437.9 30/05/2023 30/05/2043
14 A speech
recognition
method and
device
ɓ၇Ⴇ
ձༀ
ໄ
Invention
Patent
Our Company PRC CN201310231499.2 24/06/2015 24/06/2035
VI-12


--- page 542 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
15 A method and
device for
updating Q&A
sorting models of
automated Q&A
systems
І
ਪഈ
ج
ʿༀໄ
Invention
Patent
Our Company PRC CN201510007045.6 01/09/2017 01/09/2037
16 An automated
Q&A device and
method based on
learning to
rank
રҏኪ
Іਗਪഈༀໄ
ج
Invention
Patent
Our Company PRC CN201510007539.4 14/11/2017 14/11/2037
17 A system and
method for
concatenating
speech segments
for speech
synthesis
ɓ၇
Ⴇ
ટӻ୕ձ

Invention
Patent
Our Company PRC CN201410734257.X 28/11/2017 28/11/2037
18 A method and
device for quick
detection of
single-frequency
beep sounds
ɓ
၇Ҟ஺Ꮸ಻ఊ᎖౤
ʿӻ
୕
Invention
Patent
Our Company PRC CN201510050590.3 12/01/2018 12/01/2038
19 A method and
system for
acquiring
paraphrase
resources
ɓ၇
ج
ʿӻ୕
Invention
Patent
Our Company PRC CN201410648040.7 01/05/2018 01/05/2038
20 A voice output
method and
device
ࠪ
ʿༀໄ
Invention
Patent
Our Company PRC CN201510568430.8 28/12/2018 28/12/2038
21 A method and
device for testing
information
ɓ
ʿ
ༀໄ
Invention
Patent
Our Company PRC CN201510685737.6 19/02/2019 19/02/2039
VI-13


--- page 543 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
22 A voice input
method and
device
ࠪ
ʿༀໄ
Invention
Patent
Our Company PRC CN201610994428.1 14/06/2019 14/06/2039
23 A voice control
method and
device
ࠪ
ʿༀໄ
Invention
Patent
Our Company PRC CN201610211626.6 03/01/2020 03/01/2040
24 A corpus
classification
method and
device
ʱᗳ
ʿༀໄ
Invention
Patent
Our Company PRC CN201611027175.7 07/02/2020 07/02/2040
25 A speech
processing
method and
device
ஈଣ
ʿༀໄ
Invention
Patent
Our Company PRC CN201610264283.X 31/03/2020 31/03/2040
26 An improved
method for
estimating the
SRP sound
source
positioning in the
frequency
domain
ٙ
᎖ਹSRPᑊ๕˙З

Invention
Patent
Our Company PRC CN201810102202.5 24/04/2020 24/04/2040
27 An automated
data collection
and annotation
method
Іਗᅰ
˙

Invention
Patent
Our Company PRC CN201810103344.3 24/04/2020 24/04/2040
28 An air
conditioning
control method
and device
ሜ
ʿༀໄ
Invention
Patent
Our Company PRC CN201610362657.1 28/04/2020 28/04/2040
29 A method and
device for
determining users
intent in voice
interactions
Ⴇ
͜˒
ʿༀໄ

Invention
Patent
Our Company PRC CN201611178869.0 26/05/2020 26/05/2040
VI-14


--- page 544 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
30 An information
classification
method and
device
ʱ
ʿༀໄ
Invention
Patent
Our Company PRC CN201611179993.9 26/05/2020 26/05/2040
31 An offline call
method and
device of family
information
ᕎ
ٙࢹڦࢬ࢕
ʿༀໄ
Invention
Patent
Our Company PRC CN201810186950.6 09/06/2020 09/06/2040
32 A voice output
method and
device
ࠪ
ʿༀໄ
Invention
Patent
Our Company PRC CN201680002958.1 17/07/2020 17/07/2040
33 A secure data
transmission
method, device
and system
τ
ج
eༀໄʿӻ୕
Invention
Patent
Our Company PRC CN201810106944.5 28/07/2020 28/07/2040
34 A speech
synthesis method
and system
ࠪ
ʿӻ୕
Invention
Patent
Our Company PRC CN201810517280.1 25/09/2020 25/09/2040
35 A method and
device for speech
separation during
trial
ࠪ
ʿༀໄ

Invention
Patent
Our Company PRC CN201810106940.7 23/10/2020 23/10/2040
36 A method and
device for data
cache and a
system for data
transmission
ɓ
e
ༀໄʿᅰኽෂ፩ӻ
୕
Invention
Patent
Our Company PRC CN201711377201.3 05/01/2021 05/01/2041
37 An adjustable
wave-shape
concatenating
system and
method
̙ሜື
ટӻ୕ʿ

Invention
Patent
Shanghai
Unisound
PRC CN201711461842.7 12/02/2021 12/02/2041
VI-15


--- page 545 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
38 A sound source
positioning
method and
device
ɓ၇ᑊ
ʿӻ୕

Invention
Patent
Our Company PRC CN201810995819.4 02/03/2021 02/03/2041
39 A human-
machine
interaction
system for multi-
devices
autonomous
decision-making
ආБε
ɛ
ዚʹʝӻ୕
Invention
Patent
Our Company PRC CN201910323610.8 02/03/2021 02/03/2041
40 A sound pickup
method and
device by
microphone
array
৬
ʿༀ
ໄ
Invention
Patent
Our Company PRC CN201910912566.4 02/03/2021 02/03/2041
41 A sound source
positioning
method
ɓ၇ᑊ

Invention
Patent
Our Company PRC CN201910258214.1 12/03/2021 12/03/2041
42 A voice
evaluation
method and
system
൙
ʿӻ୕
Invention
Patent
Shanghai
Unisound
PRC CN201810864099.8 19/03/2021 19/03/2041
43 A sound pickup
method by
decentralized
distributed
microphones
ɓ
ʱ̺
˙

Invention
Patent
Our Company PRC CN201910779512.5 09/04/2021 09/04/2041
44 A method and
device for
monitoring
microphones
௥
ʿༀ
ໄ
Invention
Patent
Our Company PRC CN201910913709.3 13/04/2021 13/04/2041
VI-16


--- page 546 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
45 A method for fast
and stable
cancellation of
echo for
intelligent voice
interaction
device
ࠪ
֛

Invention
Patent
Our Company PRC CN201810310759.8 01/06/2021 01/06/2041
46 A method for
understanding
dialogue
commands based
on knowledge
graph
׵
࿁༑ն

Invention
Patent
Our Company PRC CN201910389711.5 29/06/2021 29/06/2041
47 A method and
device for
extracting
classification
features of
sentences based
on hybrid
templates
׵
՟̩ɿ
ʿ
ༀໄ
Invention
Patent
Our Company PRC CN201810201961.7 02/07/2021 02/07/2041
48 A method and
system for
mining of similar
entities
Νᗳྼ
ʿӻ
୕
Invention
Patent
Our Company PRC CN201810106851.2 17/08/2021 17/08/2041
49 A data rights
management
method and
system
ᅰኽᛆ
ʿӻ୕

Invention
Patent
Our Company PRC CN201810284184.7 17/08/2021 17/08/2041
50 A device and
method for
segmentation of
streaming natural
language
information
ݴ
ٙࢹڦ

Invention
Patent
Our Company PRC CN201810218878.0 27/08/2021 27/08/2041
VI-17


--- page 547 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
51 A method and
system for
filtering non-
medical record
content for
ultrasound
departments
൴
࢙ٙ
ʿӻ୕
Invention
Patent
Our Company PRC CN201810548693.6 31/08/2021 31/08/2041
52 A heuristic voice
interaction
method and
system
઼೯ό
ʿༀ
ໄ
Invention
Patent
Our Company PRC CN201810175225.9 03/09/2021 03/09/2041
53 A construction
system and
method of
medical
knowledge
graph
ɓ၇ᔼᐕ
ӻ

Invention
Patent
Our Company PRC CN201910334418.9 03/09/2021 03/09/2041
54 A method and
device for failure
detection of high
availability
nodes
ɓ၇৷̙
ღᏨ಻˙
ʿༀໄ
Invention
Patent
Xiamen
Unisound
PRC CN202010245646.1 14/09/2021 14/09/2041
55 A method and
device for mining
hybrid templates
of Chinese
sentences
ဏႧ
ܱٙؐ
ʿༀໄ
Invention
Patent
Our Company PRC CN201810201422.3 21/09/2021 21/09/2041
56 A HVAD
(Hardware Voice
Activity
Detection)
system
ɓ၇೷
᎖˴ਗઞ
಻
HVADӻ୕
Invention
Patent
Our Company PRC CN201910924900.8 22/10/2021 22/10/2041
57 A method and
device for
improving
robustness of
speech
recognition
ɓ
ᗆйᖢ
ༀໄʿՉ˙

Invention
Patent
Our Company PRC CN201811466497.0 17/12/2021 17/12/2041
VI-18


--- page 548 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
58 A method and
system for
cancelling
reverberation
ٙ
ձӻ୕
Invention
Patent
Our Company PRC CN201910810308.5 17/12/2021 17/12/2041
59 A speech
synthesis method
for generating
new timbre
ɓ၇
ࠪ

Invention
Patent
Our Company PRC CN201910780718.X 07/11/2022 07/11/2042
60 An audio and
video synthesis
method
ࠪ

Invention
Patent
Our Company PRC CN201910912787.1 18/02/2022 18/02/2042
61 A method for
improving the
success rate of
voice
awakening
ɓ၇
ఎ፴ϓ̌

Invention
Patent
Our Company PRC CN201811466502.8 22/03/2022 22/03/2042
62 A method and
device for
identifying
unspecified
diagnosis coding
errors on home
page of medical
records
ɓ၇ᗆ
ܸ
˙
ʿༀໄ
Invention
Patent
Our Company PRC CN201910970105.2 25/03/2022 25/03/2042
63 A method and
device for
constructing
ASR/NLU engine
cross-
optimization of
data closed
loop
ɓ၇࿴
ிASR/NLUˏᏗ
ʹɸᎴʷᅰኽௐᐑ
ʿༀໄ
Invention
Patent
Our Company PRC CN201910983952.2 01/04/2022 01/04/2042
64 A speech
synthesis method
and device
ɓ၇
ʿༀ
ໄ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN201911420316.5 22/04/2022 22/04/2042
VI-19


--- page 549 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
65 A text positioning
method and
system based on
understanding of
natural
language
ɓ၇ਿ
ٙ
ձӻ
୕
Invention
Patent
Our Company PRC CN201910804622.2 29/04/2022 29/04/2042
66 A method and
device for sound
source
separation
ɓ၇
ʿༀ
ໄ
Invention
Patent
Our Company
and Shenzhen
Unisound
PRC CN202110268230.6 14/06/2022 14/06/2042
67 A sound pickup
method and
system by
microphone
array
ɓ၇௥д
˙
ʿӻ୕
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202010850399.8 17/06/2022 17/06/2042
68 A method and
device for
English speech
synthesis
˖
ʿༀ
ໄ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202010141017.4 24/06/2022 24/06/2042
69 A speech
enhancement
method, device,
equipment and
storage
medium
ᄣ
eༀໄeண
௪ձπᎷʧሯ
Invention
Patent
Our Company
and Shenzhen
Unisound
PRC CN202110287956.4 02/08/2022 02/08/2042
70 A multilingual
abstracts
generation
method, device,
electronic
equipment and
computer-
readable
medium
εႧԊ
e
ༀໄeཥɿண௪ʿ
ၑዚ̙ᛘʧሯ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202110132073.6 23/09/2022 23/09/2042
VI-20


--- page 550 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
71 An open voice
evaluation
method and
equipment
ɓ၇
൙಻
ձண௪
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202110132058.1 18/10/2022 18/10/2042
72 A method,
device, electronic
equipment and
storage medium
for Chinese and
English speech
mixed
synthesis
ߵ
૿ΥΥϓ˙
eༀໄeཥɿண
௪ձπᎷʧሯ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202110628882.6 27/12/2022 27/12/2042
73 An activation
authorization
method and
system for smart
devices
ɓ၇౽
બᛆ˙
ʿӻ୕
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202011504333.X 30/12/2022 30/12/2042
74 A method for
cancelling wind
noise
ɓ၇̘ৰ

Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202011504399.9 24/01/2023 24/01/2043
75 A speech
conversion
method, device,
electronic
equipment and
storage
medium
ɓ၇Ⴇ
eༀໄ
eཥɿண௪ձπᎷ
ʧሯ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202110284443.8 24/01/2023 24/01/2043
76 A method and
device for
deploying
heterogeneous
supercomputing
platform
ɓ၇௅
ٙ
ʿༀໄ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202010317608.2 28/02/2023 28/02/2043
VI-21


--- page 551 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
No. Patent Name Type Patentee
Place of
Registration Patent Number
Grant Date
(dd/mm/yyyy)
Expiry Date
(dd/mm/yyyy)
77 A speech intent
recognition
method, device
and readable
storage
medium
ɓ၇Ⴇ
e
ༀໄʿ̙ᛘπᎷʧ
ሯ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202110616990.1 28/02/2023 28/02/2043
78 A method for
improving the
quality of
personalized
synthesized
voice
׌ࡈ
ٙ

Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202010163515.9 21/03/2023 21/03/2043
79 A method and its
device for
whitening
multiple voices in
voice
interaction
ɓ၇
ʹʝʕε༩Ⴇ
ʿՉ
ༀໄ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202010339154.9 21/03/2023 21/03/2043
80 An extracting
method, device,
electronic
equipment and
storage medium
for target
direction of
speech
ɓ၇ͦᅺ
ج
eༀໄeཥɿண௪
ձπᎷʧሯ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202110616989.9 21/03/2023 21/03/2043
81 A speech
separation
method, device,
equipment and
storage
medium
ʱ
eༀໄeண
௪ձπᎷʧሯ
Invention
Patent
Our Company
and Xiamen
Unisound
PRC CN202110268203.9 24/03/2023 24/03/2043
VI-22


--- page 552 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
(d) Domain Names
As of the Latest Practicable Date, we had registered the following domain names which we
consider to be or may be material to our business:
No. Domain Name
Registered
Owner Place of Registration
Expiry Date
(dd/mm/yyyy)
1. igaicloud.cn Shanghai Unisound PRC 10/05/2026
2. unisound.com Our Company PRC 20/12/2026
3. yunzhisheng.cn Our Company PRC 31/05/2026
C. FURTHER INFORMATION ABOUT OUR DIRECTORS AND SUPERVISORS
1. Disclosure of Interests
Save as disclosed below, immediately following the completion of the Global Offering
(assuming that the Over-allotment Option is not exercised), so far as our Directors are aware, none of
our Directors, Supervisors or chief executive has any interests or short positions in our Shares,
underlying shares and debentures of our Company or any 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.
(a) Interests and short positions of our Directors, Supervisors or chief executive in the share capital
of our Company and its associated corporations following completion of the Global Offering
Interests in Shares
Name of Director or
chief executive Nature of Interest(1)
Number and
class of
Shares held
Approximate
percentage of
shareholding in
the relevant
class of Shares
after the Global
Offering(2)(%)
Approximate
percentage of
shareholding in the
total share capital
of our Company
after the
Global Offering (%)
Domestic Unlisted Shares
Dr. Huang ...... Interests in controlled corporations 13,544,911 54.19% 18.91%
Interests held jointly with other persons 16,481,964 65.94% 23.02%
Dr. Liang ....... Beneficial owner 1,835,658 7.34% 2.56%
Interests held jointly with other persons 16,481,964 65.94% 23.02%
Dr. Kang ....... Beneficial owner 1,101,395 4.41% 1.54%
Interests held jointly with other persons 16,481,964 65.94% 23.02%
Mr. Li Zhichao . . Interest in controlled corporation 176,477 0.71% 0.25%
H Shares
Dr. Huang ...... Interests in controlled corporations 5,804,961 13.81% 8.11%
Interests held jointly with other persons 7,063,697 16.80% 9.86%
Dr. Liang ....... Beneficial owner 786,710 1.87% 1.10%
Interests held jointly with other persons 7,063,697 16.80% 9.86%
Dr. Kang ....... Beneficial owner 472,026 1.12% 0.66%
Interests held jointly with other persons 7,063,697 16.80% 9.86%
Mr. Li Zhichao . . Interest in controlled corporation 152,097 0.36% 0.36%
VI-23


--- page 553 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
Notes:
(1) All interests stated are long position.
(2) The calculation is based on the total number of 24,995,061 Domestic Unlisted Shares in issue and 47,537,043 H Shares to be in issue
(including 27,977,641 H Shares to be converted from Domestic Unlisted Shares, 11,849,122 H Shares to be converted from Unlisted
Foreign Shares and 1,560,980 H Shares to be issued pursuant to the Global Offering) in issue upon the Listing, assuming that the Over-
allotment Option is not exercised.
(3) See the section headed “Substantial Shareholders” in this prospectus for details.
(b) Interests and short positions disclosable under Divisions 2 and 3 of Part XV of the SFO
For the 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 any other member of our Group, see “Substantial Shareholders”
and “History, Development and Corporate Structure” in this prospectus.
So far as set out above, our Directors are not aware of any persons (other than our Directors,
Supervisors or chief executive) 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 member of our Group.
2. Service Contracts
Pursuant to Rules 19A.54 and 19A.55 of the Listing Rules, we have entered into a contract with
each of our Directors and Supervisors 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 or Supervisors in their respective capacities as Directors or
Supervisors (other than contracts expiring or determinable by the employer within one year without
any payment of compensation (other than statutory compensation)).
3. Director’s and Supervisors’ Remuneration
Save as disclosed in “Directors, Supervisors and Senior Management” and “Appendix I
Accountant’s Report — Note 40 Benefits and interests of directors” for the three financial years ended
December 31, 2022, 2023 and 2024, none of our Directors or Supervisors received other remunerations
of benefits in kind from us.
4. Disclaimers
Saved as disclosed in this prospectus:
(a) none of our Directors, Supervisors or any of the parties listed in “Qualification of Experts”
of this Appendix is:
(i) interested in our promotion, or in any assets which, within the two years immediately
preceding the date of this prospectus, 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;
VI-24


--- page 554 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
(ii) materially interested in any contract or arrangement subsisting at the date of this
prospectus which is significant in relation to our business;
(b) save in connection with the Hong Kong Underwriting Agreement and the International
Underwriting Agreement, none of the parties listed in “Qualification of Experts” of this
Appendix:
(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 Supervisors 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 or Supervisors 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. EMPLOYEE INCENTIVE SCHEMES
The Company has adopted the 2016 Employee Incentive Scheme and the 2023 Employee
Incentive Scheme to recognize the contributions of our key employees, incentivize our management
team, retail talent and promote our long-term sustainable development. Neither the 2016 Employee
Incentive Scheme nor the 2023 Employee Incentive Scheme is subject to the provisions of Chapter 17
of the Listing Rules as neither of them involves any grant of share options or awards by the Company
after the Listing.
(a) Employee Incentive Platforms
As of the Latest Practicable Date, the Company had established three Employee Incentive
Platforms, namely Yunsi Shangzhi, Yunsi Shangxin and Yunchuang Hudong for the 2016 Employee
Incentive Scheme. Yunsi Shangzhi and Yunsi Shangxin also accommodated the 2023 Employee
Incentive Scheme.
Yunsi Shangzhi
We have established Yunsi Shangzhi, a limited partnership on December 12, 2016 as one of the
employee incentive platform for the 2016 Employee Incentive Scheme and the 2023 Employee
Incentive Scheme. The general partner of Yunsi Shangzhi is Tianjin Yunsheng, a limited liability
company established in the PRC and held by Dr. Huang and Mr. Liu Shengping, both are Directors, as
to 99% and 1%. As of the Latest Practicable Date, Yunsi Shangzhi was held by its general partner,
Tianjin Yunsheng, as to 3.1601%, and its limited partners as to 96.8399%. The limited partners of
Yunsi Shangzhi were Mr. LI Xiaohan (an Executive Director and a supervisor of Shanghai Unisound),
Mr. LIU Shengping (an Executive Director), Mr. LI Peng (an Executive Director), Mr. LIU Qingsong
(a supervisor of Xiamen Unisound), Mr. SHAN Bo (a Supervisor), Mr. REN He (a Supervisor),
Mr. CHEN Jisheng (a director of Shanghai Unisound and Yunmao Hulian and a supervisor of
Shenzhen Unisound), Mr. LIANG Jiameng (a sibling of Dr. LIANG Jia’en, one of the Directors) and
20 employees of the Group who were Independent Third Parties and each of whom held less than 10%
partnership interest in Yunsi Shangzhi, who held 28.3648%, 14.4108%, 12.6563%, 3.8188%, 3.8188%,
3.7509%, 1.8902%, 0.7638% and 27.3655% as of the Latest Practicable Date.
VI-25


--- page 555 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
Yunsi Shangxin
We have established Yunsi Shangxin a limited partnership on January 19, 2017 as one of the
employee incentive platform for the 2016 Employee Incentive Scheme and the 2023 Employee
Incentive Scheme. The general partner of Yunsi Shangxin is Tianjin Yunsheng. As of the Latest
Practicable Date, Yunsi Shangxin was held by its general partner, Tianjin Yunsheng, as to 0.0242%,
and its limited partners as to 99.9758%. The limited partners of Yunsi Shangxin were Mr. CHEN
Jisheng (a director of Shanghai Unisound and Yunmao Hulian and a supervisor of Shenzhen
Unisound), Ms. LI Na (the Chief Financial Officer and a joint company secretary of the Company),
one employee of the Group (namely Mr. XIE Guanchao, who ceased to be a director of Yunmao
Hulian, an insignificant subsidiary of the Company in February 2023, and therefore an Independent
Third Party), and three other employees of the Group who were Independent Third Parties and each of
whom held less than 10% partnership interest in Yunsi Shangxin, who held 6.1624%, 6.1115%,
81.0351% and 6.6668% as of the Latest Practicable Date.
Yunchuang Hudong
We have established Yunchuang Hudong a limited partnership on May 13, 2015 as one of the
employee incentive platform for the 2016 Employee Incentive Scheme. The general partner of
Yunchuang Hudong is Tianjin Yunsheng. As of the Latest Practicable Date, Yunchuang Hudong was
held by its general partner, Tianjin Yunsheng, as to 0.0103%, and its limited partners as to 99.9897%.
The limited partners of Yunchuang Hudong were Dr. Huang (an Executive Director), Yunsi Shangxin
and an employee of the Group who was an Independent Third Party, who held 41.948%, 42.3766%,
and 15.6651% as of the Latest Practicable Date.
(b) Key Terms of Employee Incentive Schemes
1. 2016 Employee Incentive Scheme
The Company has adopted the 2016 Employee Incentive Scheme by a resolution of our
Shareholders on June 5, 2020 as an amendment, restatement and consolidation of the previous
employee share incentive scheme adopted by the Company since 2015. The 2016 Employee Incentive
Scheme is not subject to the provisions of Chapter 17 of the Listing Rules as it does not involve any
grant of share options or awards by the Company after the Listing, except for the disclosure
requirements under Rule 17.12 of the Listing Rules.
Eligibility
Pursuant to the stock incentive agreements, the participants of the 2016 Employee Incentive
Scheme (the “ Participants”) shall include (i) key employees of the Group, (ii) employees who have
positively contributed to the operating performance, technology research and development and future
development of the Group, and (iii) other employees as determined by our Company. A Participant
ceases to be an eligible Participant if:
(i) the Participant has been charged or held liable for (a) disclosure of the business secrets of
the Group, (b) any material adverse effect on the reputation of the Group, or (c) direct or
indirect economic losses of the Group;
(ii) the Participant engages in competing business of the Group without prior written consent
of the Company;
VI-26


--- page 556 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
(iii) other circumstances which cause a Participant to cease to be an eligible Participant as
agreed in the stock incentive agreement occurs (collectively, the “ Causes”).
Awards
An award under the 2016 Employee Incentive Scheme (the “ Award(s)”) gives a Participant in
the 2016 Employee Incentive Scheme a conditional right when granted the Award to obtain interests in
the Employee Incentive Platform at the consideration separately agreed in the stock incentive
agreement entered into among the Company, the General Partner (as defined below) and the relevant
Participant. Upon becoming the limited partner of the Employee Incentive Platforms, the selected
Participants indirectly receive economic interest in the corresponding number of underlying Shares
held by the Employee Incentive Platforms.
The direct or indirect voting rights in our Company of each Employee Incentive Platform shall
be exercised by the general partner of the Employee Incentive Platform, Tianjin Yunsheng Information
Technology Co., Ltd. (the “ General Partner ”), pursuant to the partnership agreements and stock
incentive agreements.
Administration
The 2016 Employee Incentive Scheme shall be subject to the administration of the General
Partner and the Board in accordance with the terms of the 2016 Employee Incentive Scheme and the
relevant stock incentive agreements, including the right to construe and interpret the 2016 Employee
Incentive Scheme and the terms of the Awards granted under it.
Term
The 2016 Employee Incentive Scheme was restated on June 5, 2020 and shall continue to be
effective so long as the Employee Incentive Platforms hold Shares, subject to termination pursuant to
applicable laws and regulations.
Number of Shares
The number of Shares held by the Employee Incentive Platforms under the 2016 Employee
Incentive Scheme is 4,271,915, representing approximately 6.16% of the aggregate amount of the
Shares in issue immediately before the completion of the Global Offering and 6.05% of our total issued
share capital immediately upon the completion of the Global Offering assuming the Over-allotment
Option is not exercised.
Restrictions on Transfer and Disposal
Pursuant to the terms of the 2016 Employee Incentive Scheme, unless otherwise agreed in the
stock incentive agreement, the selected Participants may not dispose of, transfer, pledge or otherwise
encumber his or her interest in the limited partnership without the consent of the general partner of the
Employee Incentive Platforms.
Upon the listing of the Company and the expiration of the lock-up period of the Shares, the
Participants are entitled to apply to transfer all or partial of the Awards under the organization of the
General Partner in accordance with the 2016 Employee Incentive Scheme. The tax applicable to such
transfer shall be borne by the Participants.
VI-27


--- page 557 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
Lapse of the Award
The Participants may be required to withdraw from the 2016 Employee Incentive Scheme and
transfer all of the interests in the Employee Incentive Platform held by them to the General Partner in
accordance with the 2016 Employee Incentive Scheme, including but not limited to (1) expiration or
termination of the employment; (2) failure to meet the condition(s) as agreed in the stock incentive
agreement, and/or (3) ceasing to be an eligible Participant for any Cause.
Details of the Awards Granted
As of the Latest Practicable Date, the aggregate number of Shares underlying the Awards
granted to the Participants was 4,900,660, among which (i) 4,271,915 Shares underlying the Awards
were granted to, vested and exercised by the Participants as set out below, representing approximately
6.16% of the aggregate amount of the Shares in issue immediately before the completion of the Global
Offering and 6.02% of our total issued share capital immediately upon the completion of the Global
Offering assuming the Over-allotment Option is not exercised. Details of the Awards granted under the
2016 Employee Incentive Scheme are set out as below; (ii) 175,603 Shares underlying the Awards
granted to four former employees of the Group were bought back by the General Partner in accordance
with their respective stock incentive agreements; and (iii) 453,142 unvested Shares underlying the
Awards granted to one employee lapsed in accordance with his stock incentive agreement.
Name of the grantees Relationship with our Group
Number of incentive
Shares held
Approximate percentage of
shareholding immediately
following completion of the
Global Offering (1)
Connected Persons
Mr. LI Xiaohan ( ҽቢఫ) Executive Director and a supervisor
of Shanghai Unisound 820,402 1.16%
Mr. LIU Shengping ( ᄎʺ̻) Executive Director 416,808 0.59%
Mr. LI Peng ( ҽᘄ) Executive Director 366,063 0.52%
Mr. SHAN Bo (تSupervisor 110,454 0.16%
Mr. REN He ( ΂ͫ) Supervisor 108,487 0.15%
Mr. CHEN Jisheng ( ௓Λ௷) A director of Shanghai Unisound and
Yunmao Hulian and a supervisor
of Shenzhen Unisound 123,588 0.17%
Mr. LIU Qingsong (
ؒڡA supervisor of Xiamen Unisound 110,454 0.16%
Mr. LIANG Jiameng (ຑ) A software development engineer of
the Company and a sibling of
Dr. LIANG Jia’en, one of the
executive Directors 22,091 0.03%
Subtotal 2,078,347 2.93%
Independent Third Parties
— 16 employees of the Group and 10
former employees of the Group 2,193,568 3.09%
Total — 4,271,915 6.02%
(1) Assuming no Over-allotment is exercised.
Save as disclosed above, all the Awards under the 2016 Employee Incentive Scheme were
granted, vested and exercised and there are no Shares underlying the Employee Incentive Platforms,
which are reserved for grant of Awards to future grantees under the 2016 Employee Incentive Scheme.
VI-28


--- page 558 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
2. 2023 Employee Incentive Scheme
The Company has adopted the 2023 Employee Incentive Scheme by a resolution of our
Shareholders on April 12, 2023. The 2023 Employee Incentive Scheme is not subject to the provisions
of Chapter 17 of the Listing Rules as it does not involve any grant of share options or awards by the
Company after the Listing.
Eligibility
Pursuant to the stock incentive agreements, the participants of the 2023 Employee Incentive
Scheme (“ Scheme Participants ”) shall include employees of the Group as determined by our
Company. A Scheme Participant ceases to be an eligible Scheme Participant if:
(i) the participant has been charged or held liable for (a) acceptance of kickbacks,
embezzlement and theft, (b) disclosure of the trading and technical secrets of the Group,
(c) any material adverse effect on the reputation of the Group, (d) direct or indirect
economic losses of the Group, or (e) other criminal offense;
(ii) the participant or the relative of the participant, directly or indirectly, engages in
competing business of the Group or have any interest in any business which competes, or
is likely to compete with the business of the Group, without prior written consent of the
Company;
(iii) the participant solicits existing or prospective customers of the Group;
(iv) the participant induces or attempts to induce employees of the Group to terminate
employment with the Group;
(v) the participant achieves the conditions as provided in the 2023 Employee Incentive
Scheme by fraudulent means;
(vi) the participant is unable to accomplish the work arrangements assigned by the Group as a
result of his/her establishment of labor relations with other employers or provision service
to other employers;
(vii) the participant is ineligible to be a shareholder of the listed companies in accordance with
applicable laws and regulations;
(viii) the participant’s interest in the Employee Incentive Platforms may encumber the listing of
the Company;
(ix) other circumstances where the participant violates the terms of the employment contract,
constitution document, regulations and policies of the Group, or applicable laws and
regulations; and
(x) other circumstances which result a participant to cease to be an eligible Participant as
agreed in the stock incentive agreement occurs.
Awards
An award under the 2023 Employee Incentive Scheme gives a Scheme Participant in the 2023
Employee Incentive Scheme an option (the “ Option”) when granted the award to subscribe interests in
the Employee Incentive Platforms at the consideration separately agreed in the stock incentive
agreement entered into among the Company, the General Partner and the relevant Scheme Participant.
VI-29


--- page 559 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
Upon becoming the limited partner of the Employee Incentive Platforms, the selected Scheme
Participants indirectly receive economic interest in the corresponding number of underlying Shares
held by the Employee Incentive Platforms.
The direct or indirect voting rights in our Company of each Employee Incentive Platform shall
be exercised by Tianjin Yunsheng Information Technology Co., Ltd., the general partner of the 2023
Employee Incentive Platform (the “ General Partner ”), pursuant to the partnership agreements and
stock incentive agreements.
Administration
The 2023 Employee Incentive Scheme shall be subject to the administration of the General
Partner, the Board and the board of Supervisors in accordance with the terms of the 2023 Employee
Incentive Scheme and the relevant stock incentive agreements, including the right to construe and
interpret the 2023 Employee Incentive Scheme and the terms of the awards granted under it.
Term
The 2023 Employee Incentive Scheme was adopted on April 12, 2023 and shall continue to be
effective so long as the Employee Incentive Platforms hold Shares, subject to termination pursuant to
applicable laws and regulations.
Number of Shares
The number of Shares underlying the Options held by the 2023 Employee Incentive Platforms
under the 2023 Employee Incentive Scheme is 60,555 Shares, representing approximately 0.09% of the
aggregate amount of the Shares in issue immediately before the completion of the Global Offering and
0.09% of our total issued share capital immediately upon the completion of the Global Offering
assuming the Over-allotment Option is not exercised.
Vesting and Exercise of the Options
The Options granted shall be vested in full on the sixth anniversary of the date of joining the
Group by the Scheme Participants.
A Scheme Participant may exercise his or her awards in whole or in part by paying the full
subscription price in respect of the Option to be exercised, as stipulated in the exercise notice, within
15 days from the date of receipt of such exercise notice issued by the General Partner.
Transferability
Pursuant to the terms of the 2023 Employee Incentive Scheme, the selected Scheme
Participants may not dispose of, transfer, pledge or otherwise encumber his or her Option before the
exercise of the Options. The General Partner may determine the cancelation of the unexercised Options
granted to such selected Scheme Participants.
Upon the Listing of the Company and the expiration of the lock-up period of the Shares
underlying the Options, the Scheme Participants are entitled to apply to transfer all or partial of the
Shares underlying the Options in accordance with the 2023 Employee Incentive Scheme. All taxes
applicable to such transfer shall be borne by the Scheme Participants.
VI-30


--- page 560 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
Lapse of the Award
The Shares underlying the Options granted to Scheme Participants may be required to be
withdrawn and transferred in whole to the General Partner at the exercise price in accordance with the
2023 Employee Incentive Scheme, including but not limited to ceasing to be an eligible Scheme
Participant for any cause as stipulated in the 2023 Employee Incentive Scheme.
Details of the Awards Granted, Vested and Exercised
As of the Latest Practicable Date, the aggregate number of Shares underlying the awards
granted to the Scheme Participants was 60,555, all of which were granted to, vested and exercised by
seven employees of the Group, who were Independent Third Parties, representing approximately
0.09% of the aggregate amount of the Shares in issue immediately before the completion of the Global
Offering and 0.07% of our total issued share capital immediately upon the completion of the Global
Offering assuming the Over-allotment Option is not exercised.
All the awards under the 2023 Employee Incentive Scheme were granted, vested and exercised
and there are no Shares underlying the Employee Incentive Platforms, which are reserved for grant of
awards to future grantees under the 2023 Employee Incentive Scheme.
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
Saved as disclosed in this prospectus, 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.
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. All necessary arrangements have been made to
enable the securities to be admitted into CCASS.
The Joint Sponsors satisfy the independence criteria applicable to sponsors set out in
Rule 3A.07 of the Listing Rules. Each of the Joint Sponsors will receive a fee of US$500,000 for
acting as a sponsor for the Listing.
4. Preliminary Expenses
Our Company did not incur any material preliminary expenses.
VI-31


--- page 561 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
5. Qualification 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
A licensed corporation under the SFO 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
Haitong International
Capital Limited
A licensed corporation under the SFO to conduct type 6 (advising on corporate
finance) of the regulated activity as defined under the SFO
PricewaterhouseCoopers Certified Public Accountants under Professional Accountants Ordinance (Chapter 50
of the Laws of Hong Kong) and Registered Public Interest Entity Auditor under
Accounting and Financial Reporting Council Ordinance (Chapter 588 of the Laws of
Hong Kong)
Frost & Sullivan
(Beijing) Inc.,
Shanghai Branch Co.
Independent industry consultant
Han Kun Law Office Qualified PRC lawyers
Grandway Law Offices Qualified PRC lawyers
6. Consents of Experts
Each of the experts referred to in “Qualification of Experts” in this Appendix has given and has
not withdrawn its respective written consents to the issue of this prospectus with the inclusion of
certificates, letters, opinions or reports and the references to its names included herein in the form and
context in which it is respectively included.
Save as disclosed in this Prospectus, none of the experts named above has any of our
shareholding interests in any member of our Group or rights (whether legally enforceable or not) to
subscribe for or to nominate persons to subscribe for our securities in any member of our Group.
7. Compliance Advisor
We have appointed Haitong International Capital Limited as our compliance advisor upon the
Listing in compliance with Rule 3A.19 of the Listing Rules.
8. Taxation of Holders of H Shares
The sale, purchase and transfer of H Shares are subject to Hong Kong stamp duty. Hong Kong
stamp duty will apply at the current standard rate of 0.26% on the higher of the consideration paid for,
or the market value of the Shares being sold, purchased or transferred, whether or not the sale or
purchase is effected on or off the Stock Exchange. For further information in relation to taxation, see
“Appendix III — Taxation and Foreign Exchange — III. Taxation in Hong Kong”.
9. No Material Adverse Change
Our Directors confirm that, as of the date of this prospectus, there has been no material adverse
change in our financial position or prospects since December 31, 2024.
VI-32


--- page 562 ---
10. Binding Effect
This prospectus shall have the effect, if any application is made pursuant hereto, of rendering
all persons concerned bound by all the provisions (other than the penal provisions) of sections 44A and
44B of the Companies (Winding Up and Miscellaneous Provisions) Ordinance so far as applicable.
11. 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.
12. Restrictions on Share Repurchases
For details, see the sections headed “Appendix IV — Summary of Principal PRC and Hong
Kong Legal and Regulatory Provisions” and “Appendix V — Summary of the Articles of Association”
in this prospectus.
13. Bilingual Prospectus
The English language and Chinese language versions of this prospectus are being published
separately, in reliance upon the exemption provided by section 4 of the Companies Ordinance
(Exemption of Companies and Prospectuses from Compliance with Provisions) Notice (Chapter 32L of
the Laws of Hong Kong).
VI-33
APPENDIX VI STATUTORY AND GENERAL INFORMATION


--- page 563 ---
APPENDIX VI STATUTORY AND GENERAL INFORMATION
14. Promoters
The promoters of our Company comprised all of the 29 then shareholders of our Company as at
May 26, 2019 before our conversion into a joint stock limited liability company. See "History,
Reorganization and Corporate Structure — Conversion into a joint stock company with limited liability
in June 2019" for further details of the promoters of our 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.
VI-34


--- page 564 ---
APPENDIX VII DOCUMENTS DELIVERED TO THE
REGISTRAR OF COMPANIES IN HONG KONG AND
AVAILABLE ON DISPLAY
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 VI — Statutory and General Information —
Other Information — Consents of Experts ”; and
(b) a copy of each of the material contracts referred to in “ Appendix VI — Statutory and
General Information — Further Information about our Business — Summary of Material
Contracts”.
DOCUMENTS AVAILABLE 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.unisound.com during a period of 14 days
from the date of this prospectus:
1. the Articles of Association;
2. the Accountant’s Report prepared by PricewaterhouseCoopers, 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, 2022, 2023 and 2024;
4. the report from PricewaterhouseCoopers 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 material contracts in “ Appendix VI — Statutory and General Information — Further
Information about our Business — Summary of Material Contracts ”;
6. the written consents referred to in “ Appendix VI — Statutory and General Information —
Other Information — Consents of Experts ”;
7. the service contracts referred to in “ Appendix VI — Statutory and General Information
— Further Information about our Directors and Supervisors — Service Contracts ”;
8. the legal opinions issued by Han Kun Law Offices and Grandway Law Offices, our PRC
Legal Advisors, in respect of, among other things, the general corporate matters and the
property interests of our Group under PRC law;
9. the terms of the Employee Incentive Schemes;
10. the industry report issued by Frost & Sullivan (Beijing) Inc., Shanghai Branch Co., the
summary of which is set forth in the section headed “ Industry Overview ” in this
Prospectus; and
11. the PRC Company Law, together with its unofficial English translations.
VII-1


--- page 565 ---
GLOBAL OFFERING
(A joint stock company incorporated in the People’s Republic of China with limited liability)
Stock Code: 9678
Joint Sponsors, Sponsor-Overall Coordinators, Overall Coordinators, Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Bookrunners and Joint Lead Managers
Unisound AI Technology Co., Ltd.
雲知聲智能科技股份有限公司
Unisound AI Technology Co., Ltd.
雲知聲智能科技股份有限公司
