GMT EIGHT - New Share

Preview of new US stocks | Hong Kong beauty product retailer Pitanium: net profit decreased by 13% year-on-year, industry recovery does not equal to strong performance.

Looking at the development overview of the beauty and personal care retail industry in Hong Kong in recent years, the two key words of "fluctuation" and "recovery" can be said to have been running through it all along. Affected by the epidemic, the sales of beauty and personal care products in the Hong Kong market experienced a decline in 2020 and 2021, but began to gradually recover after 2022. According to data from the Hong Kong Census and Statistics Department, the retail sales of cosmetics and personal care products in 2023 increased by about 15% compared to the previous year, indicating a return of consumer confidence. However, the recovery of consumer confidence may not necessarily mean that related companies will also see a "rebound" in performance. On February 14th, a beauty and consumer goods retailer in Hong Kong, Pitanium, submitted an initial public offering (IPO) application to the U.S. Securities and Exchange Commission. The company plans to issue 1.8 million shares of stock at a price of $4 to $5 per share, raising $8 million. Based on the midpoint of the proposed price range, Pitanium's market value will reach $102 million. Established in 2013, the company mainly sells skincare, personal care, and hair care products under the brands PITANIUM and BIG PI, primarily through six retail stores in Hong Kong and online sales. However, behind Pitanium's move to enter the secondary market, it also reveals the hidden pain of the company's operational performance. Net profit decline, significant liquidity pressure According to reports, the PITANIUM brand under Pitanium was mainly launched in 2019, initially providing high-end skincare and hair care solutions for Hong Kong spas. The brand "BIG PI" was mainly launched in 2023, providing a full range of products to retail customers using different product formulas. The company's skincare revenue mainly includes facial care products such as essence, facial cleansers, masks, and toners; hair care revenue mainly includes shampoos, conditioners, hair care, and hair masks; cosmetics revenue mainly includes sales of base makeup, compact powders, eyeliners, mascara, and lipsticks; revenue from other products mainly includes sales of body care products such as deodorants, makeup removers, and exfoliating oils, as well as sales of health supplements, laundry detergent, and dishwashing liquid. According to the prospectus data, as of the end of September 30, 2023 and the fiscal year ended September 30, 2024, the company's revenues were HK$69.196 million and HK$74.9304 million, respectively, a year-on-year increase of 9.87%. On the contrary, the company's net profit was in a declining state, with profits of HK$10.254 million and HK$8.8963 million, respectively, a year-on-year decrease of 13.25%. During the reporting period, Pitanium significantly increased the company's marketing and promotion expenses to increase consumer awareness of its brands and generate more sales. In the fiscal year ended September 30, 2024, the company's total sales and marketing promotion expenses amounted to HK$11.7978 million, an increase of 13.31% year-on-year, which may also be a major reason for squeezing the company's profit capacity. It is worth noting that the pressure of declining profitability has evidently transmitted to the company's liquidity. According to the prospectus disclosure, as of September 30, 2024, Pitanium had HK$16.945 million in cash, a decrease of 10.59% from the same period in 2023. During the period, the company's total current assets were HK$25.7311 million, while total current liabilities were HK$22.2678 million, indicating significant short-term liquidity pressure. Based on the above, it can be seen that even though consumer confidence in the beauty and personal care retail market in Hong Kong is recovering, the performance of Pitanium, with declining net profit and tight liquidity, clearly reveals the company's poor performance. Industry gradually recovering, internal operational weaknesses to be resolved The retail industry has always been a key industry in Hong Kong, contributing more than 3% of the overall GDP in the past five years. In 2023, the online retail sales of beauty and personal care products reached HK$2.7169 billion, with a compound annual growth rate of 13.6% from 2018 to 2023. This can be attributed to the emergence of direct-to-consumer and market platform sales of related products in the early 2010s, and the market is expected to reach HK$3.4198 billion by 2028, with a compound annual growth rate of 8.9% from 2024 to 2028. The offline retail sales of beauty and personal care products in Hong Kong decreased from HK$33.321 billion in 2018 to HK$19.4206 billion in 2023, with a compound annual growth rate of -10.2%. The decline in 2019 and 2020 was attributed to a decrease in the number of tourists and the closure of offline retail stores due to the outbreak of the epidemic. With the reopening of borders and the recovery of the tourism industry, the offline retail sales of beauty and personal care products in Hong Kong increased from HK$13.0592 billion in 2022 to HK$194.206 billion in 2023. Consistent with the overall retail market, the future outlook for offline retail sales of beauty and personal care products in Hong Kong remains optimistic, with an expected market size of HK$26.57 billion by 2028 and a compound annual growth rate of 6.0% from 2024 to 2028. Furthermore, the beauty and personal care products market in Hong Kong also reflects two major trends: consumers are increasingly inclined towards high-end, functionally segmented (such as anti-allergy, natural ingredients), and convenient products (such as travel sizes, online shopping). Secondly, KOL marketing and social media (Instagram, Xiaohongshu) are becoming increasingly influential in purchasing decisions. In addition, the beauty and personal care products market in Hong Kong is highly fragmented. In 2023, there were about 5000 brands, which can be categorized into two main types based on their operational coverage: large multinational companies and local small and medium-sized brands. In 2024, Pitanium, along with two other major leading companies in the Hong Kong beauty and personal care product industry, together accounted for only 0.04% of the total retail value of beauty and personal care products in Hong Kong. Given the above, it is easy to see that, under the dual effect of external factors and internal weaknesses, Pitanium's performance not only cannot follow the industry's "recovery," but also seems not incidental. Specifically, there are certain internal operational weaknesses within Pitanium at present: on one hand, the company.The product structure is aging, while local consumers are increasingly paying attention to health, sustainability (such as Clean Beauty), and personalized products. If Pitanium fails to timely launch segmented categories that fit these trends, such as Clean Beauty and men's skincare, it may lose favor with young consumers. On the other hand, the company's channel strategy is also stagnant, with high rental costs and poor sales efficiency for offline stores, and a lag in online transformation (such as lack of live e-commerce layout and user experience inferior to DTC brands).It is worth mentioning that, although the decline in Pitanium's profits is a result of external shocks and internal shortcomings, its core competitiveness still has the potential to be reshaped. The key is believed to lie in its ability to clearly differentiate its positioning, avoid generic competition; accelerate digitalization and omnichannel integration, reduce operational costs; bind local culture and sustainable trends, and build emotional identification. Furthermore, if it can form a closed loop in product innovation, experiential scenarios, and membership operations, it may regain market initiative. Pitanium has clearly realized the above growth points - in its prospectus, it disclosed the company's future growth strategy, planning to develop its business by upgrading its existing business in Hong Kong and expanding its business to markets beyond Hong Kong through the following business strategies; planning to enhance customer experience by launching a mobile application; developing a new product line specifically for home therapy; expanding its product portfolio and exploring new suppliers. Additionally, the company also plans to further strengthen its marketing strategy. Overall, under the dual effects of external factors and internal shortcomings, Pitanium's intention to list on the secondary market is clear. Whether the company can turn the unfavorable situation around through its own growth strategy and it remains to be seen and verified over time.

21/02/2025

Qianhe Technology (QHT.US) plans to go public in the US. The China Securities Regulatory Commission requires additional clarification on the establishment of the equity structure and the compliance of the reverse merger.

On February 21st, the China Securities Regulatory Commission (CSRC) announced the "Supplementary Materials Requirements for Overseas Issuance and Listing (February 14th, 2025 - February 20th, 2025)," with the CSRC International Department issuing supplementary material requirements for 6 companies. Among them, QHT Technology was required to provide supplementary explanations on the legality of its equity structure construction and reverse mergers, as well as the specific plan for this issuance and listing. It is reported that QHT Technology (QHT.US) is preparing to list on the NASDAQ in the United States, with plans to issue 1.3 million shares at a price range of $5 to $6 per share, raising $7 million. At the midpoint of the proposed range, the international market value of QHT Technology will reach $95 million. Please provide supplementary explanations on the following matters, have them reviewed by lawyers, and provide clear legal opinions: 1. Regarding the legality of the equity structure construction and reverse mergers. (1) Please provide conclusive opinions on the legality and compliance of offshore structure construction and reverse investment involving foreign investment regulatory procedures, and explain whether the reporting obligations stipulated in the "Administrative Measures for Foreign Investment Information Reporting" have been fulfilled. (2) Please explain the pricing basis and fairness of the equity transfer price in the process of acquiring domestic operating entity shares, the payment situation, tax payment situation, and whether it complies with the provisions of "Foreign Investors Acquiring Domestic Enterprises." 2. Regarding the issuance plan. Please explain the specific plan for this issuance and listing, including the number of shares to be issued under the condition of not exercising or exercising the over-allotment option, the percentage of total equity capital after issuance, a list of changes in equity structure before and after issuance, the expected amount of funds raised, the specific uses of the funds raised, and the corresponding proportions. It is reported that QHT Technology was founded in 2002 and is headquartered in Wuhu, Anhui province. The company operates its domestic subsidiary Wuhu QHT Technology Co., Ltd., producing and selling components and parts for passenger cars, trucks, and train carriages in China. One of the company's most successful products to date is the liquefied natural gas cylinders for trucks, which are lightweight, easy to install and unload, and cost-effective. In 2019 alone, QHT produced over 28,000 liquefied natural gas cylinder frames. According to an F&S report, as of 2023, the company is the largest supplier in the Chinese liquefied natural gas cylinder frame market, holding a 22.7% market share.

21/02/2025

Weimi Holdings (MJID.US) plans to list on the US stock market. The China Securities Regulatory Commission has requested additional information on the fulfillment of the commitments made during the previous filing.

On February 21st, the China Securities Regulatory Commission (CSRC) publicized the "Supplementary Material Requirements for Overseas Issuance and Listing Registration (February 14, 2025February 20, 2025)", and the CSRC International Department issued supplementary material requirements for 6 enterprises. Among them, MAJESTIC IDEAL HOLDINGS LTD (hereinafter referred to as "Majestic Ideal Holdings") was required to provide information on the fulfillment of commitments made during the previous filing. The company plans to list on NASDAQ with the stock code "MJID". The CSRC requested the company to provide supplementary explanations on the following matters and requested lawyers to verify and provide clear legal opinions: 1. The situation and reasons for not completing the overseas issuance and listing within 12 months of the previous filing notice. 2. The fulfillment of commitments made during the previous filing. Information shows that Majestic Ideal Holdings provides supply chain management services for the Chinese clothing industry, with a focus on yarn products and ready-to-wear apparel. The company offers a full range of services in the clothing supply chain, including market trend analysis, product design and development, raw material procurement, etc., with clients including brand owners, textile manufacturers, clothing procurement agents, online fashion and clothing retailers.

21/02/2025

Qing Minshu Science and Technology (QMSK.US) plans to go public in the United States. The China Securities Regulatory Commission requires supplementary explanations about the reasonableness of the prices at which new shareholders have invested in the company in the 12 months prior to submitting the filing for approval.

On February 21, the China Securities Regulatory Commission announced the disclosure of supplementary materials required for overseas issuance and listing filings (February 14, 2025 - February 20, 2025). The Commission requested Qingmin Shuke (QMSK.US) to provide supplementary explanations on the inconsistencies in shareholding and shareholding ratios between the issuer and Qingmin Technology shareholders, and to explain the reasons for such discrepancies, as well as the risks and countermeasures that may arise from the related arrangements, such as control stability, defaults of related parties, etc. They were also asked to provide the rationale for the pricing of new shares issued by new shareholders in the 12 months prior to the filing application. Chinese automotive insurance post-sales service provider Qingmin Shuke submitted its initial public offering (IPO) application to the U.S. Securities and Exchange Commission on January 28. The company, based in Qingdao, China, plans to issue 1.5 million shares at a price of $4 to $6 per share, raising $8 million. Based on the midpoint of the proposed range, Qingmin Shuke's valuation will reach $83 million. The company is requested to provide supplementary explanations and have legal counsel review and issue clear legal opinions on the following issues: 1. With regards to the equity structure and changes in equity, please explain: (1) The conclusion on the compliance of regulatory procedures related to the construction of the equity structure and repatriation through mergers and acquisitions involving forex management, foreign investment, tax management, etc.; (2) The reasons for the inconsistencies in shareholding and shareholding ratios between the issuer and Qingmin Technology shareholders, and the risks and countermeasures that may arise from the related arrangements, such as control stability, defaults of related parties; (3) The rationale for the pricing of new shares issued by new shareholders in the 12 months prior to the filing application, the existence of any relationships between the new shareholders and the issuer's directors, supervisors, senior management, the intermediaries, and their key personnel, whether there are any prohibitions on holding shares held by entities directly or indirectly holding shares of the issuer; (4) The pricing basis, actual payment of consideration, and tax payment details of the tenth share transfer of Qingmin Technology, the tenth share transfer of Qingmin Shuke, and the second share transfer of Qingmin Shanghai. 2. With regards to standard operations, please explain the situation of the operations of domestic entities operating APPs, mini-programs, official accounts, websites, etc., including the scale of personal information collection and storage, the use of personal information, any transfer of data abroad or provision of personal information to third parties, and arrangements or measures for information data protection before and after listing. The company serves corporate clients in the Chinese insurance industry, mainly as a third-party service provider and insurance company for auto insurance, providing comprehensive business solutions. Since the establishment of the domestic entity in China in 2013, the company has accumulated extensive knowledge of the auto insurance industry, focusing on providing post-sales services for car insurance, such as insurance risk assessment services and value-added services like vehicle safety inspection and vehicle repair services. Additionally, the company provides other customized services based on specific needs, such as IT services and promotional services. With strong technological capabilities, the company has independently developed the "Qingmin Service Platform" (QMSP) to facilitate integration with enterprise client systems and improve service efficiency. Furthermore, through collaboration with external suppliers, the company has established a wide service network covering 10,651 service locations in 30 provincial-level administrative regions in China. In the six months ending on September 30, 2024, Qingmin Shuke provided services to a total of 57 corporate clients. According to the prospectus, financially, during the past fiscal years of 2023, 2024, and the first six months of 2025 (ending on September 30, 2024), Qingmin Shuke's revenues were $14.21 million, $38.16 million, and $25.81 million, with year-on-year growth rates of 168.5% and 85.6%, respectively. The corresponding net profits were $0.0755 million, $2.4421 million, and $0.632 million, showing year-on-year growth rates of 313.5% and -19.1%, respectively. In terms of business segments, revenue from post-sales services in the automotive insurance market is the main source of income. During the reporting period, revenues from this business were $8.516 million, $34.638 million, and $23.08 million, accounting for approximately 59.9%, 90.8%, and 59.4% of total revenue, respectively. It is evident that the significant growth in post-sales automotive insurance services has led to an increase in the company's revenue.

21/02/2025

Dragon Holdings plans to list on the US stock market. The China Securities Regulatory Commission has requested additional information on the establishment of the equity structure and the compliance of the reverse mergers.

On February 21st, the China Securities Regulatory Commission (CSRC) announced the "Supplementary Materials Requirement for Overseas Issuance and Listing Filing (February 14, 2025 - February 20, 2025)", and the CSRC's International Department issued supplementary material requirements for 6 companies. Among them, Julong Holding was required to provide supplementary explanations on the construction of shareholding structure and the compliance of reverse mergers, operational entities, business operations, information protection, and data security. It is reported that on February 20th, the CSRC's International Cooperation Department issued the "Notice of Overseas Issuance and Listing Filing for Julong Holding Limited". Julong Holding Limited plans to issue no more than 2.392 million common shares and list on the NASDAQ Stock Exchange in the United States. The CSRC requested the company to provide explanations on the following matters and asked lawyers to verify and provide clear legal opinions: 1. Regarding the construction of the shareholding structure and the compliance of reverse mergers, please explain: (1) Whether the domestic operational entities Beijing Junsinian Company and Julong Online Company have completed the domestic direct investment foreign exchange registration procedures as required; (2) During the process of Beijing Junsinian Company acquiring 99% of the shares of Julong Online Company, please explain the pricing basis and fairness of the equity transfer transaction price, payment methods and payment terms, and the specific situation of fulfilling tax declaration obligations. 2. Regarding the historical evolution: (1) Before December 2023, Beijing Huizhunian Investment Co., Ltd. was the controlling shareholder of Julong Online Company, please explain whether the company, its controlling shareholders, and actual controllers have been subject to the prohibitive provisions of Article 8 of the Measures for the Administration of the Issuance of Securities by Domestic Companies Overseas since the beginning of 2021, taking into account the main changes in the controlling shareholders of Beijing Huizhunian Investment Co., Ltd.; (2) Conclusion on the legality and compliance of the establishment of the main domestic operational entities and the history of equity changes. 3. Regarding the operational entity: According to the prospectus, the company's main business includes contracting, operating, and maintaining intelligent engineering projects, as well as selling equipment and materials for intelligent systems. During the reporting period, there were subcontracting of engineering projects from companies controlled by the actual controller. Please explain the situation of other construction-related business companies controlled by the actual controller in the past three years, including company name, establishment time, specific business in the past three years, involvement in litigation, arbitration or administrative penalties, the existence of significant violations or irregularities, and in conjunction with the changes in the main business of Julong Online Company in the past three years, explain the reasons and rationale for not including the aforementioned construction-related business companies under the scope of this listing as the main domestic operational entities. 4. Regarding business operations: According to the prospectus, the company's business includes providing intelligent engineering system services to public utility units such as airports, universities, and hospitals for security and visitor management. Please explain whether the company and its domestic operational entities are involved in important areas related to national security such as important infrastructure as specified in the Regulations on the Review of Foreign Investment Security, and whether they are subject to the Foreign Investment Security Review. 5. Regarding information protection and data security: Please explain the situation of the company's development/operation of websites, apps, mini-programs, if any, the scale of collecting and storing user information, data collection and usage, the occurrence of providing information to third parties, and the arrangements or measures for personal information protection and data security before and after listing.

21/02/2025

Together AI is valued at 3.3 billion US dollars, and the financing boom for AI startups continues.

The startup company Together AI, which provides artificial intelligence computing services, has successfully raised $305 million in funding, with General Catalyst leading the round, bringing the company's valuation to $3.3 billion. This indicates a strong demand for artificial intelligence in the enterprise sector. Prosperity7 Ventures from Saudi Arabia co-led this funding round, with other investors including Salesforce Ventures, NVIDIA Corporation, Kleiner Perkins, Emergence Capital, Lux Capital, Coatue Management, and other investors. Together AI's platform allows developers to access open-source AI models and the computing power needed to build AI applications. CEO Vipul Ved Prakash stated that the company offers comprehensive services, including data centers, Nvidia's computing clusters, as well as software and platform services, enabling customers to quickly launch and operate. According to an anonymous source, the startup's recent annual revenue exceeded $100 million, a significant increase from $30 million in February 2024. Clients can utilize over 200 open-source models through the Together AI platform, including models from Meta Platforms' Llama and Chinese AI startup DeepSeek. Prakash emphasized the importance of open-source AI models for innovation, and the company aims to provide as many of these models as possible. Prakash mentioned that NVIDIA Corporation is not only an investor in Together AI, but also a partner, as the company's services are based on NVIDIA Corporation hardware. The startup plans to deploy NVIDIA Corporation's Blackwell GPU in its data centers. The latest valuation leap of Together AI from $1.25 billion in March 2024 is significant, and Prakash stated that the company intends to double its workforce by the end of 2025 using the new funds. In the field of artificial intelligence, besides Together AI, several other startups have recently gained attention. Anthropic, a new AI company founded by former research executives from OpenAI, is in the final stages of fundraising and plans to raise up to $2 billion, valuing the company at $60 billion. Lightspeed Venture Partners is leading this round. Anthropic's successful AI chatbot Claude has attracted much attention, and it is widely used in functions such as sales, marketing, and customer service. Additionally, Harvey is a startup developing generative artificial intelligence tools for law firms, and according to sources, Sequoia Capital is in talks to lead a $300 million funding round, which would value Harvey at $3 billion. This round of funding would more than double Harvey's valuation, placing it among the multi-billion-dollar startup companies. Harvey has raised over $200 million to date from investors including OpenAI Startup Fund, GV, Elad Gil, and Kleiner Perkins. Sequoia Capital first invested in Harvey in 2023. AI startup Perplexity AI Inc. has completed a $500 million funding round, doubling its valuation to $9 billion. The search product developed by the company aims to compete with Alphabet Inc. Class C under Alphabet. Institutional Venture Partners is leading this funding round, which was completed earlier this month. Perplexity AI's valuation has tripled in the past few months, indicating rapid growth and potential in the market.

21/02/2025

Dragon Holding listed on the US stock market and obtained approval.

On February 20th, the China Securities Regulatory Commission's Department of International Cooperation issued the "Notice on the Overseas Issuance and Listing Record of Julong Holding Limited." The company plans to issue no more than 2,392,000 common shares and list on the NASDAQ stock exchange in the United States.

20/02/2025

Preview of new stocks in the US market | Financial backtesting business steady growth, GaoYing Technology relies on Saas cloud services to win the quantitative trading market?

Currently, global geopolitical turmoil is intensifying, and the interest rate environment continues to be under pressure, financial institutions are facing unprecedented operational challenges. The new productivity revolution led by large-scale models is sweeping the global financial industry, reshaping the industry landscape and disrupting traditional models. PwC states that in the next 5-10 years, financial technology will become a core force driving the development of the global digital industry. The accelerated iteration of AI and digital technology is driving a profound transformation in global financial technology, changing the operating models of the financial industry. High Yield Technology is a vertical enterprise that has emerged in this industry innovation. Recently, the company filed an updated registration statement with the U.S. Securities and Exchange Commission (SEC), with the stock code GIT, planning to list on the U.S. Nasdaq IPO. It filed confidentially with the SEC on March 28, 2023, and later publicly disclosed the registration statement on December 15, 2023. Revenue and net profit double growth The registration statement shows that High Yield Technology, from Shenzhen, Guangdong, mainly provides high-performance backtesting solutions for the financial industry (especially for those engaged in quant trading strategy development and related services). The company's backtesting services include cloud-based SaaS solutions, custom backtesting system development; the company also meets the needs of small and medium-sized enterprises by providing enterprise management SaaS solutions, including basic business functions such as sales and marketing management, human resource management, administration and operations, and customer relationship management; the company also provides software system development services. High Yield Technology has deployed a hybrid cloud infrastructure, including proprietary private computing clusters and public clouds rented from third-party cloud providers. The company's system is based on cloud-native technology, leveraging the technical advantages of the cloud platform for rapid deployment and elastic scalability. The company's proprietary hybrid cloud infrastructure allows us to optimize computing power and provide universally accessible and easily scalable products. The company's long-term commitment to cloud-based solutions enables its products to be highly adaptable to a variety of customer use cases. The registration statement shows that in the fiscal years 2023 and 2024 (with fiscal year end dates of September 30 each year, hereinafter referred to as the reporting period), High Yield Technology's revenues were $1,158,700 and $15,397,300, respectively, a 38% increase year-over-year; the corresponding net profits were $4,079,900 and $7,331,200, respectively, a 79.7% increase year-over-year. The double growth in revenue and net profit enhances the company's cash flow. During the reporting period, cash flow from operating activities was $5,552,300 and $6,844,800; year-end cash and cash equivalents were $7,867,400 and $14,717,600, respectively. Further breakdown shows that in the fiscal year 2024, revenue from backtesting solutions was $11,880,300, accounting for as high as 77.2%, enterprise management SaaS services were $2,140,700, accounting for approximately 13.9%, and software system development services revenue was $1,376,300, accounting for 8.9%. Compared with the same period last year, not only did the backtesting cloud solution business experience growth during the year, but the newly expanded enterprise management SaaS service business also grew in sync, leaping to become the "second growth curve". In fact, this is undoubtedly due to the increasing integration of mainstream technological trends such as algorithmic trading, big data analysis, machine learning, blockchain, and cloud computing into trading in recent years. In particular, hedge funds are applying this trend of technological progress to actual financial trading scenarios, from automated trading to data analysis, including backtesting. Financial IT solution providers are able to keep up with advancing technology and combine financial IT solutions with technological advances to meet the needs of financial institutions and leverage market growth opportunities. The registration statement shows that High Yield Technology's backtesting SaaS platform integrates data, strategies, and distributed task scheduling of computing resources in one, providing customers with high-performance backtesting tools and computing services to test the effectiveness of investment strategies. High Yield Technology's customer base consists primarily of investors, including developers of quantitative trading strategy software systems, individual investors, small and medium-sized enterprises, and financial institutions. For example, quantitative traders can quickly validate trading strategies and reduce risks and increase returns using their platform; small and medium enterprises use enterprise management SaaS solutions to achieve digital transformation and improve management efficiency. Fintech rises with the times Business expansion may be influenced by the financial markets With the appearance of Siasun Robot & Automation, a group of people in floral robes dancing and twirling handkerchiefs on the 2025 CCTV Spring Festival Gala, the attention of domestic and foreign technological innovations has quickly been shrouded in a "mysterious Eastern force", echoing the concept of the "Six Dragons of Hangzhou" has also quickly gained international fame. This powerful name represents six companies founded in Hangzhou, with strong technological innovation capabilities and influence: Deep Quest, Yu Shu Technology, Game Science, Deep Cloud Technology, Strong Brain Technology, and Group Core Technology. The strong rise of the "Six Dragons of Hangzhou" is not a "sudden spring wind of one night", but a result of continuous hard work and dedication. The source of financial technology has become the key factor behind the takeoff of the "Six Dragons of Hangzhou". At the same time, with the significant increase in computing power, the accumulation of massive available data, and the establishment of investment models, domestic quantitative funds have experienced rapid development, undoubtedly giving rise to a large number of companies servicing the capital market and quantitative strategies. The so-called backtesting solution is a subset of financial IT solutions, which quant traders use to test their trading strategies based on historical data to see how they have performed in the past. This involves simulating the execution of strategies on historical data and evaluating their performance based on certain indicators. Backtesting is an important step in formulating trading strategies because it allows traders to see if their ideas are reasonable before taking any actual capital risks, identifying potential issues, and analyzing profitability. According to Frost & Sullivan data, global revenue generated by backtesting solutions increased from $205.54 billion in 2017 to $307.63 billion in 2022, with a compounded annual growth rate of 8.4% during the period. With algorithmic trading, big data analysis, machine learning, and blockchains increasingly integrated into trading, the demand for backtesting solutions is expected to continue to grow.Technological advancements such as blockchain and cloud computing have improved the demand for diverse algorithmic trading strategies, driving market growth expected to continue during the forecast period. Global revenue generated from backtesting solutions is projected to grow at a compound annual growth rate of 9.4% from 2023 to 2027.However, even though quantitative strategies have been thriving in recent years, the risks of market volatility are still worth considering. High Profit Technology also openly acknowledges the risk factors, as some of the company's revenue comes from clients involved in investment management and the development of quantitative trading strategies, many of whom's profitability and management fees are tied to the assets managed.

20/02/2025

Preview of new stocks in US stock market| Net profit increases by more than 90%, will Macau brokerage Dao Yuan Group (ZGM.US) still face difficulties in entering the US stock market?

Recently, a financial technology products provider from Macau, China, Zenta Group Company (ZGM.US), publicly filed an IPO prospectus with the U.S. Securities and Exchange Commission (SEC) in preparation for listing on the Nasdaq. According to public information, the company plans to issue 1.5 million ordinary shares, representing 12.95% after the completion of this issuance. The issue price is expected to be between $4-$5, with the fundraising range between $6 million and $7.5 million. Approximately 20% of the funds raised will be used to expand business in Macau, Hong Kong, and Southeast Asia; around 40% will be used for developing financial technology business; about 10% will be used for brand development and team expansion; and the remainder will be used for supplementary operating funds and other general corporate purposes. Zenta Group is a consulting services provider, with its main business including providing administrative, financial technology, investment brokerage, project brokerage, and project research services to numerous clients in Macau and mainland China. The company's listing entity is based in the Cayman Islands, with its main business conducted by its operating subsidiary in Macau. During a period of economic recovery, the financial sector often experiences a strengthening trend. Since February, Chinese concept stocks have shown strong performance, with the index of the Chinese concept internet ETF (513220) accumulating a 19.60% increase over 12 trading days. By choosing this listing window, Zenta Group also hopes to benefit from the positive market sentiment and attract attention from investors, but the company's true value still needs to be evaluated based on its fundamentals. Rapid growth in revenue from financial technology with concerns about dependence on large customers Based on the financial data disclosed in the prospectus, Zenta Group's performance has grown rapidly in the past two years. In the 2023 fiscal year ending on September 30 and the 2024 fiscal year, the company achieved revenues of $860,000 and $2.03 million, respectively, representing a growth of 136%. Net profit also increased from $420,000 to $800,000, a 90.5% increase. In terms of business structure, Zenta Group's operations include industrial park consulting services, commercial investment consulting services, and since the second half of 2023, the rapid growth of financial technology business has become the main contributor to performance. In the 2024 fiscal year, out of the total revenue of $2.03 million, the income from financial technology services (algorithms and big data) accounted for 67.6%, while the investment brokerage business accounted for 25.2%. Administrative services and blockchain income accounted for 3.3% and 2.9% respectively. Specifically, the financial technology business mainly provides clients with algorithms, big data models, blockchain systems, and related agency services. The income from this segment mainly comes from Client A and Client B, which earned $868,400 and $504,800 in revenue respectively during the 2024 fiscal year. Revenue from administrative services mainly comes from a comprehensive management service that Zenta Group provides to clients, including document processing, updating company change and registration information, submitting income tax returns, etc. Clients pay fixed fees at regular intervals during the contract period. As of September 30, 2024 and September 30, 2023, administrative services revenue accounted for approximately 3.3% and 7.8% of total revenue for those fiscal years, respectively. Zenta Group's industrial park consulting services mainly focus on the early development stage, utilizing its experience in providing consulting services to clients in the Greater Bay Area to assist clients in preparing and submitting industrial park project applications to government departments, and representing clients in negotiations with relevant government departments or regulatory agencies. Commercial investment consulting services involve the equity of technology companies, PE management companies, and industrial park project companies. As of the fiscal year ending on September 30, 2023, the company completed a total of 8 industrial park consulting service projects and 4 commercial investment consulting service projects. Due to pressure in the real estate market, as of the fiscal year ending on September 30, 2024, the company completed 4 commercial investment consulting service projects and had no industrial park consulting projects. In terms of expenses, the highest expenses in the 2024 fiscal year were employee benefits and professional fees. Employee benefits increased by 68.5% from $176,100 in the 2023 fiscal year to $296,800 in the 2024 fiscal year, while the average number of employees increased from 5 to 9. Professional fees increased significantly by 411.5% to $346,800, with this increase mainly due to an increase of $268,700 in audit fees for the consolidated financial statements. In terms of liquidity, the company had negative operating cash flow in the 2024 fiscal year. As of September 30, 2024, the company had cash and cash equivalents of $327,100, a decrease of $197,300 compared to the beginning of the year. With this calculation, the company's cash on hand should be sufficient to support operations for more than a year. It is noteworthy that in the 2024 fiscal year, accounts receivable from customers increased by $1.6552 million, accounts payable increased by $153,400, and accrued expenses and other liabilities increased by $179,000. These receivables are related to financial technology and investment brokerage services provided throughout the year for which payments had not been received by year-end. Furthermore, Zenta Group faces a high concentration of large customers. In the 2023 fiscal year, the total revenue contribution from major clients C and D was 45%, while in the 2024 fiscal year, major clients A and B contributed a total of 71% of the revenue, indicating a significant increase in dependence on major clients. As the performance of Zenta Group grows, the overall outlook for the financial industry is also rapidly improving. According to financial data released by the central bank, the broad money supply (M2) balance was 313.53 trillion yuan at the end of December 2024, a year-on-year increase of 7.3%. The narrow money supply (M1) balance was 67.1 trillion yuan, a year-on-year decrease of 1.4%. Total RMB loans increased by 18.09 trillion yuan in 2024. The stock of social financing at the end of 2024 was 408.34 trillion yuan. The rational growth of social financing supports the rapid recovery and improvement of the real economy. In the second half of 2024, multiple rounds of policies related to currency, finance, and real estate boosted market expectations, leading to an improvement in market sentiment, continued high trading activity, and a fundamental recovery in the brokerage sector. Data from Ping An Securities shows that the performance decline in the brokerage sector narrowed in the first three quarters, with a gradual improvement in fundamentals in the third quarter.Profit increased by 14% compared to the previous period. In the first three quarters of this year, 43 listed securities firms realized revenue of 371.4 billion yuan (up 2.7% year-on-year) and a net profit attributable to the mother of 103.4 billion yuan (down 5.9% year-on-year); in the third quarter alone, revenue was 136.4 billion yuan (up 5.6% quarter-on-quarter, up 21.0% year-on-year), and a net profit attributable to the mother of 39.5 billion yuan (up 14.1% quarter-on-quarter, up 40.8% year-on-year), showing a clear upward trend.After hitting bottom in October 2024, social financing data has reversed its previous downward trend and rebounded for two consecutive months. This data not only exceeds market expectations but also releases a positive signal of economic recovery. The improvement in M1 data and the continued improvement in long-term loans for residents further confirm the warming of economic activity. In December, M1 increased by 2005.5 billion yuan, a significant increase of 1541.6 billion yuan compared to the same period last year, marking the largest increase since June 2023; the year-on-year decrease in M1 narrowed to -1.4%, rebounding for three consecutive months. In the environment where the monetary policy stance is shifting towards "moderate easing," the weakening of the "squeezing water out of the sponge" effect in the financial sector, and the current emphasis of regulators on "guiding financial institutions to increase their credit extension," it is expected that new credit and social financing in the 25th year will see year-on-year growth, the securities sector is expected to bottom out and rebound, and annual net profits are expected to achieve positive growth. As a financial service provider and financial technology service provider, Daoyuan Group is also expected to benefit from the overall industry recovery, with financial technology business continuously contributing to performance growth. However, overall, the company has a short operating history, with significant fluctuations in performance and revenue structure, strong reliance on large customers, and may not have many advantages in the market competition. How to build its core competitiveness in the future will become a long-term issue for Daoyuan Group.

20/02/2025

Yimu Group's planned IPO in the United States has been approved.

On February 17, the China Securities Regulatory Commission issued the "Notice of Overseas Issuance and Listing Filing for YIMUTIAN INC. (Yimutian Group)". Yimutian Group plans to issue no more than 196,169,769 common shares and list on the Nasdaq Stock Exchange in the United States.

17/02/2025

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