What changed in this filing

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Item 1. Business

2024-07-15 compared with 2023-06-29 · 189 added, 169 removed, 316 unchanged (53% of the section changed)

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Our holding company, Addentax Group Corp., is listed on the Nasdaq Capital Market under the symbol of “ATXG”.

We classify our businesses into three segments:

garment manufacturing, logistics services, and property management and subleasing.

Company previously engaged in the provision of epidemic prevention supplies, which included manufacturing, distribution and trading of

epidemic prevention supplies.

As the COVID-19 pandemic is near an endemic, the Company ceased to operate in this business in the first

quarter of 2023.

The remaining assets of this business segment were reclassified into the “Corporate and others” segment.

The corresponding

items of segment information for the earlier periods were restated to reflect the change of the new segment structure.

We classify our businesses into three main segments :

garment manufacturing, logistics services, and property

management and subleasing.

The Company previously engaged in the provision of epidemic prevention supplies, which included manufacturing,

distribution and trading of epidemic prevention supplies.

As the COVID-19 pandemic is near an endemic, the Company ceased to operate

in this business in the first quarter of 2023.

The remaining assets of this business segment were reclassified into the “Corporate

and others” segment.

The corresponding items of segment information for the earlier periods were restated to reflect the change

of the new segment structure.

the context otherwise requires, all references in this annual report to “ Addentax ” refer to Addentax Group Corp.,

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Group Corp., our Nevada holding company, is the entity in which investors are investing.

Our subsidiaries include (i) Yingxi Industrial Chain Group Co., Ltd., a Republic of Seychelles company;

(ii) Yingxi Industrial Chain

Investment Co., Ltd., a Hong Kong company (“Yingxi HK”);

(iii) Qianhai Yingxi Textile & Garments Co., Ltd., a PRC

(iv) Shenzhen Qianhai Yingxi Industrial Chain Services Co., Ltd, a PRC company (“YX”), (v) Dongguan Heng Sheng

Wei Garments Co., Ltd, a PRC company (“HSW”), (vi) Dongguan Yushang Clothing Co., Ltd, a PRC company (“YS”),

(vii) Shantou Yi Bai Yi Garment Co., Ltd, a PRC company (“YBY”), (viii) Shenzhen Yingxi Peng Fa Logistic Co., Ltd., a

PRC company (“PF”);

(ix) Shenzhen Xin Kuai Jie Transportation Co., Ltd, a PRC company (“XKJ”), (x) Shenzhen

Yingxi Tongda Logistic Co., Ltd, a PRC company (“TD”), (xi) Dongguan Yingxi Daying Commercial Co., Ltd., a PRC company

(“DY”), (xii) Zhuang Hao Jia (Dongguan) Decoration Engineering Co.,Ltd, a PRC company (“ZHJ”), and

(xiii) Dongguan Au Te Si Garments Co., Ltd., a PRC company (“AOT”).

subsidiaries include (i)

Yingxi Industrial Chain Group Co., Ltd., a Republic of Seychelles company;

(ii) Yingxi Industrial Chain Investment Co., Ltd., a Hong

Kong company (“Yingxi HK”);

(iii) Qianhai Yingxi Textile & Garments Co., Ltd., a PRC company;

(iv) Shenzhen Qianhai Yingxi

Industrial Chain Services Co., Ltd, a PRC company (“YX”), (v) Dongguan Heng Sheng Wei Garments Co., Ltd, a PRC company (“HSW”),

(vi) Dongguan Yushang Clothing Co., Ltd, a PRC company (“YS”), (vii) Shantou Yi Bai Yi Garment Co., Ltd, a PRC company (“YBY”),

(viii) Shenzhen Yingxi Peng Fa Logistic Co., Ltd., a PRC company (“PF”);

(ix) Shenzhen Xin Kuai Jie Transportation Co., Ltd,

a PRC company (“XKJ”), (x) Shenzhen Yingxi Tongda Logistic Co., Ltd, a PRC company (“TD”), (xi) Zhuang Hao Jia

(Dongguan) Decoration Engineering Co.,Ltd, a PRC company (“ZHJ”), and (xii) Dongguan Au Te Si Garments Co., Ltd., a PRC company

(“AOT” ), (xiii) Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”).

Subsidiaries ” refer to, collectively, (i) Qianhai Yingxi Textile & Garments Co., Ltd.;

(ii) Shenzhen Qianhai Yingxi

Industrial Chain Services Co., Ltd (“YX”), (iii) Dongguan Heng Sheng Wei Garments Co., Ltd (“HSW”), (iv)

Dongguan Yushang Clothing Co., Ltd (“YS”);

(ii) Shenzhen Qianhai Yingxi Industrial

Chain Services Co., Ltd (“YX”), (iii) Dongguan Heng Sheng Wei Garments Co., Ltd (“HSW”), (iv) Dongguan Yushang

Clothing Co., Ltd (“YS”);

(v) Shantou Yi Bai Yi Garment Co., Ltd (“YBY”);

(vi) Shenzhen

Yingxi Peng Fa Logistic Co., Ltd., a PRC company (“PF”);

(vii) Shenzhen Xin Kuai Jie Transportation Co., Ltd, a PRC

company (“XKJ”), (viii) Shenzhen Yingxi Tongda Logistic Co., Ltd, a PRC company (“TD”), (ix) Dongguan Yingxi

Daying Commercial Co., Ltd., a PRC company (“DY”), (x) Zhuang Hao Jia (Dongguan) Decoration Engineering Co.,Ltd, a PRC

company (“ZHJ”), and (xi) Dongguan Aotesi Garments Co., Ltd.,, a PRC company (“AOT”).

In February 2023, the Company disposed DY to an independent third party.

(vi) Shenzhen Yingxi Peng Fa Logistic

Co., Ltd., a PRC company (“PF”);

(vii) Shenzhen Xin Kuai Jie Transportation Co., Ltd, a PRC company (“XKJ”),

(viii) Shenzhen Yingxi Tongda Logistic Co., Ltd, a PRC company (“TD”), (ix) Zhuang Hao Jia (Dongguan) Decoration Engineering

Co.,Ltd, a PRC company (“ZHJ”), and (x) Dongguan Aotesi Garments Co., Ltd.,, a PRC company (“AOT”), (xi) Dongguan

Hongxiang Commercial Co., Ltd., a PRC company (“HX”).

refers to Qianhai Yingxi Textile & Garments Co., Ltd, a wholly foreign owned enterprise in China, which is indirectly wholly owned

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garment manufacturing business consists of sales made principally to wholesaler located in the PRC.

We have our own manufacturing

facilities, with sufficient production capacity and skilled workers on production lines to ensure that we meet our high quality

control standards and timely meet the delivery requirements for our customers.

We conduct our garment manufacturing operations

through five wholly owned subsidiaries, namely Dongguan Heng Sheng Wei Garments Co., Ltd (“HSW”), Dongguan Yushang

Clothing Co., Ltd (“YS”), Shantou Yi Bai Yi Garment Co., Ltd (“YBY”), Zhuang

Hao Jia (Dongguan) Decoration Engineering Co.,Ltd (“ZHJ”), and Dongguan Aotesi Garments Co., Ltd.,

(“AOT”) , which are located in the Guangdong province, China.

logistics business consists of delivery and courier services covering 86 cities in 11 provinces and three municipalities in China.

We have our own manufacturing facilities,

with sufficient production capacity and skilled workers on production lines to ensure that we meet our high quality control standards

and timely meet the delivery requirements for our customers.

We conduct our garment manufacturing operations through five wholly owned

subsidiaries, namely Dongguan Heng Sheng Wei Garments Co., Ltd (“HSW”), Dongguan Yushang Clothing Co., Ltd (“YS”),

Shantou Yi Bai Yi Garment Co., Ltd (“YBY”), Zhuang Hao Jia (Dongguan) Decoration Engineering

Co.,Ltd (“ZHJ”), and Dongguan Aotesi Garments Co., Ltd., (“AOT”) , which are located in the Guangdong province,

logistics business consists of delivery and courier services covering 44 cities in 10 provinces and 2 municipalities in China.

we have our own motor vehicles and drivers, we currently outsource some of the business to our contractors.

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in the garment market.

We conduct our property management and subleasing operation through a wholly owned subsidiary, namely Dongguan Yingxi

Daying Commercial Co., Ltd.

(“DY”), which is located in the Guangdong province, China.

February 2023, the Company disposed of DY to an independent third party at fair value, which was also its carrying value as of February 28, 2023.

business operations, customers and suppliers of DY were retained by the Company;

therefore, the disposition of the subsidiary did not

qualify as discontinued operations.

We currently have an aggregate of 56,238 square meters floor space and provide approximately 1,300

shop space to clients.

In February 2023, the Company disposed of DY to an independent third party at fair value in February, 2023.

conduct our property management and subleasing operation through a wholly owned subsidiary acquired in September 2023, namely Dongguan

Hongxiang Commercial Co., Ltd., a PRC company (“HX”), which is located in the Guangdong province, China.

believe we have the following competitive strengths:

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Our logistics business has nine routes and covers 44 cities in 10 provinces and 2 municipalities in the PRC.

location and infrastructure.

Our property management and subleasing business operates through Dongguan Hongxiang Commercial Co.,

(HX), located in Guangdong province, China, is a key area for the garment market.

By securing a prime location and developing a

well-maintained infrastructure, we provide attractive and convenient spaces for garment wholesalers and retailers, enhancing their operational

efficiency and appeal to customers.

Comprehensive

property services.

We provide a wide range of property management services, including security, maintenance, and customer support,

to ensure a high standard of service for our tenants.

This comprehensive solution helps to foster a favorable business environment for

garment wholesalers and retailers, enhancing tenant satisfaction and retentions.

elements of our business and growth strategies include the following:

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our delivery network.

As of March 31, 2023, we provided logistics services to over 86 cities in 11 provinces and three municipalities

We expect to develop 20 additional logistics routes in existing serving cities and improve the Company’s

profits in the year 2023.

As of March 31, 2024, we provided logistics services to over 44 cities in 10 provinces and 2 municipalities

We expect to develop 20 additional logistics routes in existing serving cities and improve the Company’s profits in

the year 2024.

international logistics services and warehousing services.

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together to drive to increase the value of the stores in the area.

tenant experience through value-added services.

We aim to offer a range of value-added services to our tenants, including property

maintenance, marketing support, and business consulting.

These services are designed to help tenants improve their business operations,

attract more customers, and increase their profitability, thereby enhancing tenant retention and satisfaction.

digital solutions for property management.

We plan to implement advanced digital solutions to streamline our property management

This includes the use of property management software for lease administration, tenant communication, and maintenance scheduling.

By leveraging technology, we aim to improve operational efficiency and provide a seamless experience for our tenants.

data analytics for informed decision-making.

We plan to utilize data analytics to gain insights into market trends, tenant preferences,

and property performance.

By analyzing this data, we can make informed decisions on property acquisitions, rental pricing, and tenant

services, ultimately optimizing our property management and subleasing operations.

customer service and support.

We intend to improve our customer service and support by providing dedicated tenant support teams and

implementing tenant feedback mechanisms.

Exceptional customer service will help build strong relationships with tenants and improve overall

satisfaction.

garment manufacturing business

manufacture garments for various high-end fashion brands through our wholly-owned subsidiaries, HSW, YS, YBY, ZHJ, AOT, which

are located in Guangdong, the PRC.

manufacture garments for various high-end fashion brands through our wholly-owned subsidiaries, HSW, YS, YBY, ZHJ, AOT, which are located

in Guangdong province, the PRC.

customer relationship team is responsible for cultivating and maintaining our relationship with customers.

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based on their designs.

fabric team leverages our experience in fabric sourcing as well as our understanding of fabric features to recommend the types of

fabric to be used in our customers’ products.

fabric team leverages our experience in fabric sourcing as well as our understanding of fabric features to recommend the types of fabric

to be used in our customers’ products.

Our fabric team may also suggest alternative fabrics to our customers.

fabric team works with our research and development team to understand fabric types and aims to identify different fabric we source

and improve the quality and comfort of the fabric we produce.

Our fabric team works

with our research and development team to understand fabric types and aims to identify different fabric we source and improve the quality

and comfort of the fabric we produce.

product and technical team are mainly responsible for development samples of products, preparing structural and production guidance of

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generally receive more purchase orders during our second and third quarters and fewer manufacture orders during May and June.

our long-term and established customers with good payment track records, we generally provide payment terms between 30 to 180 days

following the delivery of finished goods.

our long-term and established customers with good payment track records, we generally provide payment terms between 30 to 180 days following

the delivery of finished goods.

For our new customers, we generally require advances or deposits to be made when placing orders.

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in Guangdong province, the PRC.

Our in-house logistics teams deliver to approximately 11 provinces and three municipalities in

Our in-house logistics teams deliver to approximately 10 provinces and 2 municipalities in the PRC.

a customer is located in an area not covered by our delivery fleet or where our in-house logistics teams are fully engaged, we will outsource

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We also provide customs declaration and tax clearance service to our customers who export goods to overseas.

have 848 logistics points and they are located in 11 provinces and three municipalities which cover 86 cities in the PRC.

have 121 logistics points and they are located in 10 provinces and 2 municipalities which cover 44 cities in the PRC.

internal management

management in the logistics business is responsible for setting out business strategies and managing the daily operation.

Specifically, they have regular meetings with different departments, conduct inspection and supervise the finance department,

operation department and administration department.

Specifically,

they have regular meetings with different departments, conduct inspection and supervise the finance department, operation department

and administration department.

generally receive more delivery orders in our third and fourth quarters and are more vulnerable to shipping delays in the PRC during

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customer base is diverse.

Our customers in the garment manufacturing business are mainly garment wholesalers and retailers and our

customers in logistics business are mainly trading companies and logistic companies.

No single customers accounted for more than 30%

of our net sales for the years ended March 31, 2022 and 2023

Our customers are as follows:

(i) in the garment manufacturing business are mainly garment wholesalers and

retailers, (ii)our customers in logistics business are mainly trading companies and logistic companies, and (iii) our customers in property

management and subleasing business are manufacturing companies and e-commerce companies.

There were two and one customers accounted for

more than 10% of our net sales for the years ended March 31, 2024 and 2023, respectively .

procured our garments through various textile companies in our garment manufacturing business.

In our logistics business, we procured

For our logistics business, we procured

from packing companies and transportation companies.

No single supplier accounted for more than 30% of our total costs for

the years ended March 31, 2022 and 2023.

For our property management and subleasing business, our suppliers are property

There was one supplier accounted for more than 10% of our total cost for the year ended March 31, 2024, and no single supplier

accounted for more than 10% of our total costs for the years ended March 31, 2023.

manufacturing business .

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We do not need to carry a significant amount of inventory due to the nature of the business.

Company, through its subsidiary Shenzhen Qianhai Industrial Chain Co.Ltd., herein referred as “YX,” received the approval

Company, through its subsidiary Shenzhen Qianhai Industrial Chain Co.Ltd., herein referred to as “YX,” received the approval

of the trademarks below in relation to its business from PRC government.

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principal competitive factors in the garment manufacturing market include:

brand awareness and focus;

breadth of product offerings;

quality control.

awareness and focus;

of product offerings;

principal competitive factors in the logistics market include:

delivery time;

network coverage.

principal competitive factors in the property management and subleasing market include:

Cost control;

network coverage.

believe we compete favorably with our competitors on the basis of the above factors as a result of our market position and customer base.

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of March 31, 2024, we had approximately 112 employees and there was no labor union established by our employees.

The following

table sets out a breakdown of the number of employees by function as of March 31, 2023:

The following table

sets out a breakdown of the number of employees by function as of March 31, 2024:

Administration

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believe that we maintain a good working relationship with our employees, and to date we have not experienced any significant labor disputes.

apart from customary business laws and regulations, the PRC government does not regulate the garment manufacturing business and logistics

The PRC government may, however, from time to time institute rules and regulations on such businesses which makes it difficult

or impossible for us to operate successfully, if at all, in the PRC.

Please see the section on “Risk Factors” for further

Logistics System Development

March 20, 2024, we signed a memorandum of understanding (MOU) with Dezhong Xinghui Information Technology Co., Ltd.

to develop an AI

logistics system.

This system aims to optimize vehicle dispatching, monitor real-time inventory, enable intelligent sorting and delivery,

and operate seamlessly, significantly reducing labor costs and errors while enhancing efficiency and quality in logistics operations.

Production Collaboration

March 5, 2024, we entered into a collaboration agreement with Regina Miracle International (Holdings) Limited to produce high-quality,

functional, and fashionable activewear.

This partnership leverages our manufacturing capabilities and comprehensive industry chain services

with Regina’s advanced R&D technology in sportswear, aiming to elevate product quality, streamline delivery timelines, and

fortify market competitiveness in the sportswear industry.

Tourism-As-A-Service

February 6, 2024, we signed an MOU with Shenzhen Tamir Cultural Tourism Development Co., Ltd.

to launch a “Tourism-As-A-Service”

platform utilizing AI and blockchain tools.

This initiative aims to incubate local and overseas pan-entertainment and tourism services,

enhancing efficiency and effectiveness in full-chain tourism services.

Comprehensive

Supply Chain Services

December 22, 2023, we signed an MOU with Zhongjiu Yihe (Shenzhen) Brand Development Co., Ltd.

to establish comprehensive brand, product,

and marketing supply chain services in China.

This collaboration aims to enhance our market reach and commitment to innovative partnerships.

Content Creation Research and Development

October 18, 2023, we entered into an R&D agreement with Xi’an University of Electronic Science and Technology.

This partnership

aims to advance AI content creation for the pan-entertainment industry, focusing on developing AI technology for translation, content

extraction, and creation management systems.

This collaboration enhances our capabilities and diversifies its business lines within the

AI technology realm.

PRC government has corresponding industrial regulatory measures and policies for garment manufacturing business, logistics business and

property management and subleasing business.

Our PRC subsidiaries currently comply with these regulatory requirements and have not received

any action from industry regulators for conduct of their business.

The PRC government may, however, from time to time institute rules

and regulations on such businesses which makes it difficult or impossible for us to operate successfully, if at all, in the PRC.

see the section on “Risk Factors” for further details.

PRC government encourages small to medium-sized companies in traditional industries, such as garment manufacturing, to modernize their

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Limitation on Overseas Listing and Share Issuances

we nor our subsidiaries are currently required to obtain approval from Chinese authorities, including the China Securities Regulatory

Commission, or CSRC, or Cybersecurity Administration Committee, or CAC, to list on U.S.

exchanges or issue securities to foreign investors,

however, if our subsidiaries or the holding company were required to obtain approval in the future and were denied permission from Chinese

authorities to list on U.S.

exchanges, we will not be able to continue listing on U.S.

exchange, which would materially affect the interest

of the investors.

It is uncertain when and whether the Company will be required to obtain permission from the PRC government to list

exchanges in the future, and even when such permission is obtained, whether it will be denied or rescinded.

Although the Company

is currently not required to obtain permission from any of the PRC central or local government to obtain such permission and has not

received any denial to list on the U.S.

exchange, our operations could be adversely affected, directly or indirectly, by existing or

future laws and regulations relating to its business or industry;

if we inadvertently conclude that such approvals are not required when

they are, or applicable laws, regulations, or interpretations change and we are required to obtain approval in the future.

December 24, 2021, the China Securities Regulatory Commission, or the CSRC, issued Provisions of the State Council on the Administration

of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (the “Administration Provisions”),

and the Administrative Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (the “Measures”),

which were open for public comments by January 23, 2022.

The Administration Provisions and Measures for overseas listings lay out specific

requirements for filing documents and include unified regulation management, strengthening regulatory coordination, and cross-border

regulatory cooperation.

Domestic companies seeking to list abroad must carry out relevant security screening procedures if their businesses

involve supervisions such as foreign investment security and cyber security reviews.

Companies endangering national security are among

those off-limits for overseas listings.

As the Administration Provisions and Measures have not yet come into effect, we are currently

unaffected by them.

However, it is uncertain when the Administration Provision and the Measures will take effect or if they will take

effect as currently drafted.

of the date of this prospectus, other than the response we recently received from the CSRC confirming that our offering under this prospectus

does not require the examination and approval of the CSRC in accordance with the existing PRC legislation and regulations (for more details

about this response from the CSRC, see “ Risk Factors – General Risks Associated with Business Operation in China - While

the approval of the China Securities Regulatory Commission is not currently required for our offerings, it may be required in the future

in connection with our offerings under the M&A Rules and, if required, we cannot predict whether we will be able to obtain such approval ”),

we have not received any inquiry, notice, warning, sanctions or regulatory objection to our offerings from the CSRC, CAC or any other

PRC governmental authorities, and we believe our PRC Subsidiaries have obtained all requisite permissions from PRC governmental authorities

to operate our business as currently conducted under relevant PRC laws and regulations.

each of our PRC Subsidiaries holds and maintains a business license issued by the local market supervision and administration bureau,

and has received all requisite permissions and approvals in order to conduct and operate our business.

Based on our understanding of

the PRC laws and regulations, our PRC businesses only require business licenses issued and approved from the relevant local authorities

and do not require any other permissions or approvals to operate their PRC business operations.

Further, we have not relied upon an opinion

of a PRC counsel in drawing such conclusion in the current registration statement for the following reasons:

(i) during our IPO process

which was closed on September 2, 2022, we previously engaged a local PRC counsel, Hiways Law Firm (Shenzhen), to assist with the PRC

disclosures in the IPO registration statement on Form S-1 and Hiways Law Firm (Shenzhen) confirmed such conclusion;

(ii) the time period

between the IPO and the submission of the current registration statement on January 25, 2023 is not substantial;

(iii) no material changes

occurred with respect to our PRC business operations since the IPO;

and (iv) the expenses of engaging Hiway Law Firm or another PRC counsel

for the current registration statement will be unduly burdensome on the Company;

and thus, the Company has not sought out to engage a

PRC counsel to obtain an additional opinion for the current registration statement.

As of the date of this prospectus, none of our PRC

Subsidiaries has been denied or punished by relevant governmental authorities due to its business qualifications.

In addition, we (Addentax

Group Corp.) and our non-PRC subsidiaries have also received all requisite permissions and approvals in order to conduct and operate

on the opinion of our PRC counsel, currently, each of our PRC Subsidiaries holds and maintains a business license issued by the local

market supervision and administration bureau, and has received all requisite permissions and approvals in order to conduct and operate

our business.

Based on our understanding of the PRC laws and regulations, our PRC businesses hold all the business licenses issued and

approved from the relevant local authorities and other administrative license required by its business, and do not require any other

permissions or approvals to operate their PRC business operations.

As of the date of this report, none of our PRC Subsidiaries has been

denied or punished by relevant governmental authorities due to its business qualifications.

In addition, we (Addentax Group Corp.) and

our non-PRC subsidiaries have also received all requisite permissions and approvals in order to conduct and operate our business.

order to promote domestic enterprises to carry out overseas capital market activities in accordance with law and compliance, the CSRC

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filing, such as the change of control, voluntary or mandatory delisting and other major changes after overseas issuance or listing, the

issuer should bare the obligation to report to the CSRC;

issuer should bear the obligation to report to the CSRC;

(iv) Legal liability, such as failure to fulfill the filing procedures, or violation

3 unchanged sentences

be warned and each imposed a fine of between RMB 500,000 yuan and RMB 5,000,000 yuan.

Specifically,

under the Overseas Listing Filing Rules, our Company, as an enterprise already listed on the Nasdaq Capital Market before March 31, 2023,

and is not required to make immediate filings for its listing.

However, if we issue subsequent offering on the Nasdaq Capital Market or

list in other overseas markets in the future, we shall file with the CSRC in accordance with the Overseas Listing Filing Rules;

In case of major changes, it is also necessary to report the specific situation to the CSRC.

Otherwise, the Company shall bear corresponding

legal responsibilities.

As the Overseas Listing Filing Rules are newly issued, there is still uncertainty about their interpretations

and implementations.

As a result, we cannot assure you that we will be able to complete any documents for our future issuance in a timely

manner and fully comply with the relevant new rules.

In addition, we cannot guarantee that we will not be subject to tightened regulatory

review and subsequent interference by the Chinese government.

to the Overseas Listing Filing Rules, the company, as an enterprise that has been listed on the Nasdaq Capital Market before the new

regulations come into effect, does not need to apply to the CSRC for filing immediately.

If it is issued and listed in other overseas

markets, it shall be filed in accordance with relevant regulations.

The Company entered into two private placement agreements with certain

individual investors for 330,000 common Shares each at a unit price of $0.98 per share and for a total of $646,800.

After the transactions,

we shall be filed with the CSRC within three working days after the issuance of shares is completed.

According to the Legal Opinion provided

by the Allbright Law Offices, the Company has submitted the filing application to the China Securities Regulatory Commission .

As of July 4, 2024, the application is still pending.

Accordingly, the Company’s overseas issuances and subsequent additional issuances

comply with the relevant provisions of the overseas listing filing regulation.

As the overseas listing filing process has not yet been

completed, the outcome and subsequent requirements remain uncertain.

As a result, we cannot assure you that we will be able to complete

all requirement for our future issuance in a timely manner and fully comply with the relevant new rules, if any.

In addition, we

cannot guarantee that we will not be subject to greater regulatory scrutiny or subsequent interference by the Chinese government.

of Cash to and from our Subsidiaries

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to the PCAOB, its December 2021 determinations under the HFCAA remain in effect.

On December 15, 2022, the PCAOB secures complete access

to inspect, investigate audit firms based in mainland China and Hong Kong.

On December 15, 2022, the PCAOB announced that it has

completed a test inspection of two selected auditing firms in mainland China and Hong Kong and has voted to vacate its previous Determination

Report, which concluded in December 2021 that the PCAOB could not inspect or investigate completely registered public accounting firms

based in mainland China or Hong Kong.

On December 23, 2022, the AHFCAA was enacted, which amended the HFCAA by requiring the SEC to prohibit

an issuer’s securities from trading on any U.S.

stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive

years instead of three and such act was signed into law on December 29, 2022.

It is possible when the PCAOB may reassess its determinations

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from being traded, may materially and adversely affect the value of your investment.

December 15, 2022, the PCAOB announced that it has completed a test inspection of two selected auditing firms in mainland China and Hong

Kong and has voted to vacate its previous Determination Report, which concluded in December 2021 that the PCAOB could not inspect or

investigate completely registered public accounting firms based in mainland China or Hong Kong.

On December 23, 2022 the AHFCAA was enacted,

which amended the HFCAA by requiring the SEC to prohibit an issuer’s securities from trading on any U.S.

stock exchanges if its

auditor is not subject to PCAOB inspections for two consecutive years instead of three and such act was signed into law on December 29,

The PCAOB continues to demand complete access in

mainland China and Hong Kong moving forward and has resumed regular inspections since March 2023.

Moreover, if trading in our securities

is prohibited under the HFCAA in the future because the PCAOB determines that it cannot inspect or fully investigate our auditor at such

future time, an exchange may determine to delist our securities.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business