依赖单一最大客户

In each year/period of the Track Record Period, sales to our five largest customers in the aggregate accounted for 80.5%, 74.4%, 55.2% and 46.2% of our total revenues, respectively.

Green RV held 49% equity interest in our subsidiary, Leisure Lion, and was also a dealer operating two of our dealer stores as of June 30, 2024.

To the best of our knowledge, all of our five largest customers in each year/period of the Track Record Period, except for Green RV as our JV partner, and Leisure Lion as our JV dealer, were independent third parties, and none of our Directors, their respective associates or any shareholder who, to the knowledge of our Directors, owned more than 5% of our issued share capital, had any interest in any of our five largest customers in each year/period of the Track Record Period.

For each year/period of the Track Record Period, our revenue generated from our five largest customers amounted to approximately RMB1,028.4 million, RMB997.7 million, RMB1,188.6 million and RMB490.1 million, respectively, representing approximately 66.8%, 54.3%, 49.7% and 44.4% of our total revenue for the corresponding year/period, respectively, while our revenue generated from our largest customer, Conch Cement Group, in each year/period during the Track Record Period amounted to approximately RMB807.9 million, RMB765.1 million, RMB762.4 million and RMB338.6 million, respectively, representing approximately 52.5%, 41.6%, 31.8% and 30.7% of our total revenue for the corresponding year/period, respectively.

Given our long term co-operation and business relationship with Conch Cement Group, our Directors believe that our relationship with Conch Cement Group has been and will continue to be mutually complementary to a large extent, and it is unlikely that there would be any materially adverse changes to, or termination of, such relationship in the foreseeable future.

During the Track Record Period, our proportion of revenue generated from our sales to Conch Cement Group has actually decreased throughout the years/period.

The revenue from our five largest customers for each of the years ended December 31, 2021, 2022 and 2023 and the six months ended June 30, 2024, represented approximately 90.5%, 76.1%, 84.3% and 89.4% of our total revenue for the respective year or period, and the revenue from the largest customer during each of the same year or period represented approximately 30.2%, 33.3%, 37.3% and 23.6% of our total revenue for the respective year or period.

In addition, customers have become accustomed to utilizing our equipment and systems, and a transition to alternative providers would incur switching costs.

According to Frost & Sullivan, concentration in the customer base in the maritime environmental protection equipment and system industry is in line with the industry norm based on the interviews conducted with top 10 global market players and comprehensive primary research by interviewing experts form the China Association of the National Shipbuilding Industry, a leading organization in the shipbuilding industry, encompassing various related enterprises and institutions.

For FY2021, FY2022, FY2023 and 6M2024, our revenue from our five largest customers for each year/period during the Track Record Period accounted for approximately 64.2%, 68.3%, 65.6% and 74.4% of our total revenue, respectively, and our revenue from our largest customer for each year/period during the Track Record Period accounted for approximately 22.6%, 28.4%, 32.2% and 34.2% of our total revenue, respectively.

Our revenue from Customer A constituted approximately 22.6%, 14.3%, 9.9% and 14.5% of our total revenue for FY2021, FY2022, FY2023 and 6M2024, respectively, whereas our revenue from Customer B constituted approximately 21.6%, 28.4%, 32.2% and 34.2% of our total revenue for FY2021, FY2022, FY2023 and 6M2024, respectively.

According to Frost & Sullivan, Customer A and Customer B are among the largest e-commerce companies in the PRC, and as such it is not uncommon for brand owners or sellers of nutritional products in the PRC to have material reliance on Customer A and Customer B and it is not commercially realistic for our Group to diversify our reliance.

The total revenue generated from our top five customers was RMB1.6 million, RMB8.3 million, RMB50.8 million, and RMB28.9 million in 2021, 2022, 2023, and the six months ended June 30, 2024, respectively, accounting for 70.1%, 73.1%, 75.6%, and 55.6%, respectively, of our total revenue during the same periods.

Revenue from our largest customer was RMB0.8 million, RMB4.4 million, RMB26.8 million, and RMB14.5 million in 2021, 2022, 2023, and the six months ended June 30, 2024, respectively, accounting for 35.5%, 39.1%, 39.9%, and 28.0%, respectively, of our total revenue during the same periods.

We became acquainted with our top five customers for each period during the Track Record Period through various cooperation on clinical trials, cognitive centers and brain science research projects, as well as academic conferences we organized and attended.

Revenue generated from each of our largest customer for the years ended December 31, 2021, 2022, 2023 and the six months ended June 30, 2024 accounted for 32.7%, 10.2%, 32.1% and 27.1% of our total revenue for the respective periods.

Revenue generated from our five largest customers in each period during the Track Record Period accounted for 63.5%, 39.7%, 56.3% and 49.1% of our total revenue for the respective periods.

and (ii) a decrease in revenue contribution from certain major customer affected by their product launch schedules, which, in comparison with our revenue growth of 25.2% from the six months ended June 30, 2023 to the same period in 2024, indicates our reduced reliance on certain major customers, which we believe would contribute to our overall sustained business growth.

In 2021, 2022 and 2023 and for the six months ended June 30, 2024, revenue generated from our top five customers in each of those years accounted for 52.2%, 41.5%, 33.7% and 36.2% of our total revenue, respectively, while revenue generated from our largest customer in each of those years alone accounted for 31.9%, 14.9%, 9.4% and 12.9% of our total revenue during 2021, 2022 and 2023 and for the six months ended June 30, 2024, respectively.

Jinkang An contributed 100.0%, 77.0%, 53.3%, 54.7% and 8.4% of our revenue generated from precision content services in 2021, 2022 and 2023 and for the six months ended June 30, 2023 and 2024, respectively.

Although we used to derive a significant portion of revenue of precision content services from Jinkang An in 2021, 2022 and 2023, we had been diversifying our customer base during the Track Record Period.

Revenue generated from our top five wholesale customers for FY2021, FY2022, FY2023 and 6M2024 amounted to approximately HK$92.1 million, HK$92.2 million, HK$113.4 million and HK$44.7 million, representing approximately 48.9%, 44.3%, 45.1% and 38.0% of our total revenue for each of the corresponding years/period, respectively, while revenue generated from our largest wholesale customer, namely Customer A for FY2021, FY2022 and FY2023 and 6M2024 amounted to approximately HK$90.3 million, HK$90.2 million, HK$110.7 million and HK$43.8 million, representing approximately 47.9%, 43.3%, 44.0% and 37.2% of our total revenue for each of the corresponding years/period, respectively.

Despite the relatively large portion of revenue contribution from Customer A during the Track Record Period, our Directors are of the view that our business relationship with Customer A is sustainable and our business dealings with Customer A do not give rise to excessive risks in our business operations for the following reasons:

In light of the above reasons, our Directors are of the view that our business relationship with Customer A is sustainable in nature and see no compelling reasons for Customer A to terminate our business relationship or substantially decrease the purchase from us in the foreseeable future.

We generated revenue of RMB393.0 million, RMB433.6 million, RMB620.8 million and RMB7.3 million from our five largest customers in each year/period during the Track Record Period, which accounted for 75.0%, 71.7%, 69.3% and 58.2% of our total revenue for the respective years/periods.

We generated revenue of RMB117.4 million, RMB134.2 million, RMB261.8 million and RMB4.9 million from the largest customer in each year/period during the Track Record Period, which accounted for 22.4%, 22.2%, 29.2% and 38.9% of our total revenue for the respective years/periods.

Our major customers are mainly vehicle manufacturers, including publicly listed companies and their subsidiaries, state-owned enterprises, and reputable companies.

Revenues generated from our five largest customers in each of 2021, 2022, 2023, and the six months ended June 30, 2024 accounted for 79.4%, 83.3%, 87.2% and 89.6%, respectively, of our revenue during the same years/period.

Revenue generated from each of our largest customer for the years ended December 31, 2021, 2022, 2023 and the six months ended June 30, 2024 accounted for 60.0%, 64.0%, 71.9% and 75.3%, respectively, of our revenue during the same years/period.

Despite the relatively high revenue contribution from the Related Parties to our Group during the Track Record Period, there is no undue reliance on the Related Parties to conduct our business.

In each year/period of the Track Record Period, revenue from our five largest customers amounted to RMB147.5 million, RMB192.1 million, RMB296.0 million and RMB44.4 million, respectively, accounting for 44.8%, 53.5%, 56.7% and 69.1%, respectively, of our total revenue for the same years/periods.

According to Frost & Sullivan, top five hydrogen fuel cell vehicles/hydrogen fuel cell systems providers, which are our major customer types, accounted for over 40% of total market share in terms of sales volume in 2023. Accordingly, we rely on our major customers.

The number of our customers increased from 103 in 2021 to 128 in 2022, and further to 142 in 2023.

Revenue from our five largest customers in each period of the Track Record Period accounted for 71.8%, 73.2%, 73.5% and 77.1% of our total revenue, respectively.

As of May 31, 2024, we had maintained business relationships with our five largest customers for four to nine years.

Among our five largest customers during the Track Record Period, Customer A, Customer B, Customer D and Geely Related Group were top-tier enterprises in the industries in which they operate, according to CIC.

In the years ended December 31, 2021, 2022 and 2023 and the six months ended June 30, 2024, the aggregate revenue generated from our five largest customers in each period during the Track Record Period amounted to RMB1,739.2 million, RMB11,253.8 million, RMB5,627.4 million and RMB2,159.8 million, respectively, representing 42.9%, 80.0%, 64.5% and 60.5% of our total revenue for the respective periods.

For years ended December 31, 2021, 2022 and 2023 and the six months ended June 30, 2024, revenue generated from CATL Group amounted to RMB1,160.4 million, RMB7,486.9 million, RMB2,648.0 million and RMB1,123.1 million, respectively, representing 28.6%, 53.2%, 30.3% and 31.5% of our revenue for the respective periods.

According to Frost & Sullivan, customer concentration is an industry norm in the LFP cathode material industry.

In 2021, 2022 and 2023 and for the six months ended June 30, 2024, the aggregate revenue generated from our five largest customers were RMB283.1 million, RMB482.1 million, RMB1,067.0 million and RMB727.0 million, representing 60.7%, 53.2%, 68.8% and 77.9% of our revenue, respectively.

We generated a substantial amount of RMB627.3 million and RMB351.6 million, representing 40.4% and 37.6% of our revenue, from CARIZON in 2023 and for the six months ended June 30, 2024, respectively.

Saving for Volkswagen Group and SAIC, both Shareholders of the Company, to the best of our knowledge, during the Track Record Period and up to the Latest Practicable Date, our five largest customers were independent third parties.

For FY2021/22, FY2022/23 and FY2023/24, the percentage of our total revenue attributable to our top customer for each year amounted to approximately 32.4%, 24.0% and 32.6%, respectively.

As advised by Frost & Sullivan, client concentration is a common occurrence within the civil engineering sectors, in both public and private sectors.

While it appears that a majority of our revenue was derived from a few customers during the Track Record Period, our Directors consider that our Group does not exhibit over dependency on any of our major customers as our Group undertook projects with considerably different scales.

In 2021, 2022, 2023 and the three months ended March 31, 2024, revenue from our five largest customers, accounted for 55.4%, 29.2%, 11.8%, and 11.0% of our total revenue, respectively, with our largest customer contributing 24.4%, 13.9%, 6.5%, and 5.4% of our total revenue during the same periods.

Specifically, in 2021, 2022, 2023 and the three months ended March 31, 2024, revenue from our five largest ODM customers was RMB374.1 million, RMB224.2 million, RMB186.5 million, and RMB49.7 million, respectively, representing 95.4%, 94.3%, 91.8%, and 94.0% of our total revenue from ODM business for the same periods.

Over the years, we have built long-term business relationships with our major ODM customers, with our collaboration with most of our five largest ODM customers in each period of the Track Record Period spanning over six years.

Revenue generated from our five largest customers in each year or period during the Track Record Period accounted for 77.7%, 75.4%, 47.7% and 96.6%, respectively, of our revenue for the respective year or period.

Our sales amount from Customer A was RMB24.6 million and RMB72.0 million in 2021 and 2022, respectively, accounting for 40.7% and 43.5% of our total revenue for the respective year.

Our Directors are of the view that our customer concentration during the Track Record Period is mainly due to our early commercialization stage, and we expect to develop a more diverse customer base as we enhance our commercialization efforts with more product lines and upgraded solutions.

Revenue generated from our largest customer accounted for approximately 35.0%, 38.1%, 36.1%, 34.1% and 31.7% of our total revenue for the years ended 31 December 2021, 2022 and 2023 and the four months ended 30 April 2023 and 2024, respectively.

For the years ended 31 December 2021, 2022 and 2023 and the four months ended 30 April 2024, our revenue attributable to Customer A amounted to approximately RMB42.0 million, RMB56.5 million, RMB62.8 million and RMB18.6 million, respectively, which accounted for approximately 35.0%, 38.1%, 36.1% and 31.7% of our total revenue for the corresponding period, respectively.

Despite such customer concentration, our Directors are of the view that there is no material reliance on our existing major customers and we are capable of sustaining our services in the future, primarily because:

For the years ended 31 December 2021, 2022 and 2023, revenue from our five largest customers in each respective year during the Track Record Period amounted to approximately RMB116.4 million, RMB318.0 million and RMB400.3 million, representing approximately 46.9%, 75.9% and 73.6% of our total revenue, respectively

Our Directors consider that we are not reliant on any of our five largest customers and Customer A and such customer concentration is not uncommon for the petroleum refinery and petrochemical equipment industry and the business model of our Group is sustainable despite the customer concentration

Due to the limitation of our Group’s size and scale of operation, and the fact that some contract amount are very large, it is reasonable to have our Group’s revenue for each year to be overwhelmingly dominated by just a few large contracts

During the Track Record Period, our five largest customers in each year of the Track Record Period accounted for approximately 52.7%, 38.6% and 33.3% of our total revenue, respectively. During the same periods, our largest customer in each year of the Track Record Period accounted for approximately 31.6%, 21.8% and 19.0% of our total revenue, respectively.

During the Track Record Period, our revenue contributed by Customer A represented 31.6%, 21.8% and 19.0% of our total revenue, respectively.

As advised by Customer A, as its major business focus is on the core business of 4S stores and have limited in-house technology infrastructure, data operation, dedicated research and development capacities, marketing tools and manufacturing resources, it would rely on third-party suppliers to provide products and relevant value-added solutions.