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CCSC Technology International Holdings Ltd

CCSC Technology International Holdings LtdCCTG決算レポート

Nasdaq · 電気照明及び配線器具

What changed in CCSC Technology International Holdings Ltd's 20-F — 2024 vs 2025

Top changes in CCSC Technology International Holdings Ltd's 2025 20-F

375 paragraphs added · 349 removed · 298 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

47 edited+11 added−12 removed100 unchanged
See “—There are uncertainties under the PRC Securities Law relating to the procedures and requisite timing for the U.S. securities regulatory agencies to conduct investigations and collect evidence within the territory of mainland China.” 5 The HFCAA and the Accelerating Holding Foreign Companies Accountable Act call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB.
See “-There are uncertainties under the PRC Securities Law relating to the procedures and requisite timing for the U.S. securities regulatory agencies to conduct investigations and collect evidence within the territory of mainland China.” The HFCAA and the Accelerating Holding Foreign Companies Accountable Act call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB.
These sanctions may include fines and penalties on our operations in China, limitations on our operating privileges in China, delays in or restrictions on the repatriation of the proceeds from our future offerings into the PRC, restrictions on or prohibition of the payments or remittance of dividends by our subsidiary in China, or other actions that could have a material and adverse effect on our business, reputation, financial condition, results of operations, prospects, as well as the trading price of our Ordinary Shares.
These sanctions may include fines and penalties on our operations in China, limitations on our operating privileges in China, delays in or restrictions on the repatriation of the proceeds from our future offerings into the PRC, restrictions on or prohibition of the payments or remittance of dividends by our subsidiary in China, or other actions that could have a material and adverse effect on our business, reputation, financial condition, results of operations, prospects, as well as the trading price of our Class A Ordinary Shares.
The Chinese government exerts substantial influence over the manner in which we must conduct our business and may intervene or influence our operations at any time, which actions may result in a material change in our operations and impact our operations materially and adversely, and significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our Ordinary Shares to significantly decline or be worthless.
The Chinese government exerts substantial influence over the manner in which we must conduct our business and may intervene or influence our operations at any time, which actions may result in a material change in our operations and impact our operations materially and adversely, and significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our Class A Ordinary Shares to significantly decline or be worthless.
As of the date of this report, we have not received any notices from the competent PRC authorities requiring us to make up the underpayment of social insurance and housing funds for our employees, however, we cannot guarantee that the competent PRC authorities will not order us to do so in the future.
As of the date of this annual report, we have not received any notices from the competent PRC authorities requiring us to make up the underpayment of social insurance and housing funds for our employees, however, we cannot guarantee that the competent PRC authorities will not order us to do so in the future.
The competent PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedures Law based either on treaties between mainland China and the country or region where the judgment is made or on principles of reciprocity between jurisdictions.
The competent PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedures Law based either on treaties between China and the country or region where the judgment is made or on principles of reciprocity between jurisdictions.
Any failure by us to fully comply with the new regulatory requirements, including but not limited to the failure to complete the filing procedures with the CSRC if required, may significantly limit or completely hinder our ability to offer or continue to offer our Ordinary Shares, cause significant disruption to our business operations, and severely damage our reputation, which would materially and adversely affect our financial condition and results of operations and cause our Ordinary Shares to significantly decline in value or become worthless.
Any failure by us to fully comply with the new regulatory requirements, including but not limited to the failure to complete the filing procedures with the CSRC if required, may significantly limit or completely hinder our ability to offer or continue to offer our Class A Ordinary Shares, cause significant disruption to our business operations, and severely damage our reputation, which would materially and adversely affect our financial condition and results of operations and cause our Class A Ordinary Shares to significantly decline in value or become worthless.
Mainland China does not have any treaties or other forms of written arrangement with the United States that provide for the reciprocal recognition and enforcement of foreign judgments.
China does not have any treaties or other forms of written arrangement with the United States that provide for the reciprocal recognition and enforcement of foreign judgments.
As of the date of this report, we have not been paying the social insurance and housing funds for our employees in full.
As of the date of this annual report, we have not been paying the social insurance and housing funds for our employees in full.
Our PRC legal counsel, JT&N, has advised us based on their understanding of the current PRC laws and regulations that the CSRC’s approval was not required for the listing and trading of our Ordinary Shares on Nasdaq in the context of our initial public offering under the M&A Rules, given that: (i) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like ours in this annual report are subject to the M&A Rules, (ii) we established our wholly-foreign owned enterprise (“WFOE”), CCSC Interconnect DG, by means of direct investment rather than through merger and acquisition of a “mainland China domestic company” as defined under the M&A Rules.
Our PRC legal counsel, JT&N, has advised us based on their understanding of the current PRC laws and regulations that the CSRC’s approval was not required for the listing and trading of our Class A Ordinary Shares on Nasdaq under the M&A Rules, given that: (i) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like ours in this annual report are subject to the M&A Rules, (ii) we established our wholly-foreign owned enterprise (“WFOE”), CCSC Interconnect DG, by means of direct investment rather than through merger and acquisition of a “mainland China domestic company” as defined under the M&A Rules.
Our operations could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to our business or industry, which could result in further material changes in our operations and could adversely impact the value of our Ordinary Shares.
Our operations could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to our business or industry, which could result in further material changes in our operations and could adversely impact the value of our Class A Ordinary Shares.
In addition, the Chinese government continues to play a significant role in regulating industry development by imposing industrial policies. The Chinese government also exercises significant control over China’s economy growth by allocating resources, controlling regulating payment of foreign currency-denominated obligations, setting monetary policy, and providing preferential treatment to particular industries or companies.
The Chinese government continues to play a significant role in regulating industry development by imposing industrial policies. The Chinese government also exercises significant control over China’s economic growth by allocating resources, controlling payment of foreign currency-denominated obligations, setting monetary policy, and providing preferential treatment to particular industries or companies.
As of the date of this report, we are of the view that we are in compliance with the applicable PRC cybersecurity and data security laws and regulations that have been issued by the CAC in all material respects, and we have not received any complaints from any third party, nor been investigated or punished by any competent PRC authority in this regard.
As of the date of this annual report, we believe that we are in compliance with the applicable PRC cybersecurity and data security laws and regulations that have been issued by the CAC in all material respects, and we have not received any complaints from any third party, nor have we been investigated or punished by any competent PRC authority in this regard.
The inability of the PCAOB to conduct inspections of auditors in China makes it more difficult to evaluate the effectiveness of these accounting firms’ audit procedures or quality control procedures as compared to auditors outside of China that are subject to the PCAOB inspections, which could cause existing and potential investors to lose confidence in audit procedures and reported financial information and the quality of financial statements of China-based companies. 6 Our former auditor, Friedman LLP, the independent registered public accounting firm that issued the audit report included in the annual report for our initial public offering, was headquartered in the City of New York and registered with the PCAOB during the time it served as our independent auditor.
The inability of the PCAOB to conduct inspections of auditors in China makes it more difficult to evaluate the effectiveness of these accounting firms’ audit procedures or quality control procedures as compared to auditors outside of China that are subject to the PCAOB inspections, which could cause existing and potential investors to lose confidence in audit procedures and reported financial information and the quality of financial statements of China-based companies. 7 Our former auditor, Friedman LLP, the independent registered public accounting firm that issued the audit report included in the annual report for our IPO, was headquartered in the City of New York and registered with the PCAOB during the time it served as our independent auditor.
We believe our PRC operations were not subject to cybersecurity review or network data security review by the CAC for our initial public offering, because we believe our PRC subsidiary is not a CIIO or a network platform operator possessing personal information of more than 1 million users, and our business does not involve data processing activities that affect or may affect national security.
We believe our PRC operations were not subject to cybersecurity review or network data security review by the CAC for our IPO, because we believe our PRC subsidiary is not a CIIO or a network platform operator possessing personal information of more than 1 million users, and our business does not involve data processing activities that affect or may affect national security.
The Chinese government has exercised, and continues to exercise, substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability to operate in China may be harmed by changes in its laws and regulations, including those relating to manufacturing, taxation, environmental regulations, land use rights, property and other matters.
The Chinese government has exercised, and continues to exercise, substantial control over virtually every sector of the Chinese economy. Our ability to operate in China may be harmed by changes in its laws and regulations, including those relating to manufacturing, taxation, environmental regulations, land use rights, property and other matters.
We could be subject to regulation by various political and regulatory entities, including various local and municipal agencies and government sub-divisions. The Company may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply.
Our business is subject to various government and regulatory interference. We could be subject to regulation by various political and regulatory entities, including various local and municipal agencies and government sub-divisions. The Company may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply.
As of March 31, 2022, 2023 and 2024, an estimated late fee may be imposed for the outstanding social insurance payments payable in the aggregate amount of approximately $38,141, $53,859 and $48,224, respectively. Moreover, our failure in making adequate contributions to social insurance and housing funds may also trigger private complaints filed by our employees against us.
As of March 31, 2023, 2024, and 2025, an estimated late fee may be imposed for the outstanding social insurance payments payable in the aggregate amount of approximately $53,859, $48,224, and $22,739, respectively. Moreover, our failure in making adequate contributions to social insurance and housing funds may also trigger private complaints filed by our employees against us.
Any failure or perceived failure by our Company and our PRC subsidiary to comply with the above confidentiality and archives administration requirements under the revised Provisions and other PRC laws and regulations may result in the relevant entities being held legally liable by competent authorities, and referred to the judicial organ to be investigated for criminal liability if suspected of committing a crime.
Any failure or perceived failure by our Company and our PRC subsidiary to comply with the above confidentiality and archives administration requirements under the revised Provisions and other PRC laws and regulations may result in the relevant entities being held legally liable by competent authorities, and referred to the judicial organ to be investigated for criminal liability if suspected of committing a crime. 4 Any new laws and regulations issued by the PRC authorities may subject us to additional compliance requirements.
Furthermore, we may also be subject to negative publicity and the public perception of the ineffectiveness of our security measures, and our reputation may be harmed, in the event of any of the foregoing cybersecurity breaches or attacks, which could damage our relationships with, and result in the loss of existing or potential, customers, and our business and financial condition could be materially and adversely affected. 7 Increases in labor costs in the PRC may adversely affect our business and our profitability.
Furthermore, we may also be subject to negative publicity and the public perception of the ineffectiveness of our security measures, and our reputation may be harmed, in the event of any of the foregoing cybersecurity breaches or attacks, which could damage our relationships with, and result in the loss of existing or potential, customers, and our business and financial condition could be materially and adversely affected.
In compliance with the Trial Measures, we submitted our filing materials to the CSRC on August 31, 2023, and was informed by the CSRC in writing on November 6, 2023 that we do not fall within the scope of the filing requirements at this time.
In compliance with the Trial Measures, we submitted our filing materials to the CSRC on August 31, 2023, and were informed by the CSRC in writing on November 6, 2023 that we did not fall within the scope of the filing requirements at such time.
However, our PRC legal counsel, JT&N, has further advised us that there remains some uncertainty as to how the M&A Rules will be interpreted or implemented in the context of an overseas offering and its opinions summarized above are subject to any new laws, regulations and rules or detailed implementations and interpretations in any form relating to the M&A Rules.
As of the date of this annual report, there was no material change to these regulations and policies since our IPO. 3 However, our PRC legal counsel, JT&N, has further advised us that there remains some uncertainty as to how the M&A Rules will be interpreted or implemented in the context of an overseas offering and its opinions summarized above are subject to any new laws, regulations and rules or detailed implementations and interpretations in any form relating to the M&A Rules.
In addition, if the CSRC or other regulatory agencies later promulgate new rules or explanations requiring that we obtain their approvals for our existing or future share offerings, we may be unable to obtain a waiver of such approval requirements or to obtain such approval in timely manner, or at all. 3 The New Overseas Listing Rules and other relevant rules promulgated by the CSRC may subject us to additional compliance requirements in the future.
In addition, if the CSRC or other regulatory agencies later promulgate new rules or explanations requiring that we obtain their approvals for our existing or future share offerings, we may be unable to obtain a waiver of such approval requirements or to obtain such approval in timely manner, or at all.
There are uncertainties regarding the enforcement of laws and rules and regulations in mainland China, which can change quickly with little advance notice, and there is a risk that the Chinese government may exert more oversight and control over offerings that are conducted overseas, which could materially and adversely affect our business and hinder our ability to offer our securities or continue our operations, and cause the value of our securities to significantly decline or become worthless.
Failure to take timely and appropriate measures to adapt to any of these or similar regulatory compliance challenges could materially and adversely affect our current corporate structure and business operations. 1 There are uncertainties regarding the enforcement of laws and rules and regulations in mainland China, which can change quickly with little advance notice, and there is a risk that the Chinese government may exert more oversight and control over offerings that are conducted overseas, which could materially and adversely affect our business and hinder our ability to offer our securities or continue our operations, and cause the value of our securities to significantly decline or become worthless.
Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy or regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in China or particular regions thereof, and could require us to divest ourselves of any interest we then hold in Chinese properties. 4 Our business is subject to various government and regulatory interference.
Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms or regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in China or particular regions thereof, and could require us to divest ourselves of any interest we then hold in Chinese properties.
As of March 31, 2022, 2023 and 2024, we had outstanding social insurance payments payable in the aggregate amount of approximately $140,042, $165,772 and $167,141, respectively, and outstanding housing funds in the aggregate amount of approximately $179,235, $133,229 and $116,942, respectively.
As of March 31, 2023, 2024, and 2025, we had outstanding social insurance payments payable in the aggregate amount of approximately $165,772, $167,141, and $141,068, respectively, and outstanding housing funds in the aggregate amount of approximately $133,229, $116,942, and $115,668, respectively.
To counter the rising labor costs and improve our operational efficiency, we reduced the number of manufacturing employees from 235 in fiscal year 2022 to 166 in fiscal 2023, and further to 136 as of March 31, 2024.
To counter the rising labor costs and improve our operational efficiency, we reduced the number of manufacturing employees from 166 in fiscal year ended March 31, 2023 to 136 in fiscal ended March 31, 2024, which number was increased to 139 as of March 31, 2025.
On May 18, 2020, Nasdaq filed three proposals with the SEC to (i) apply minimum offering size requirement for companies primarily operating in “Restrictive Market”, (ii) adopt a new requirement relating to the qualification of management or board of director for Restrictive Market companies, and (iii) apply additional and more stringent criteria to an applicant or listed company based on the qualifications of the company’s auditors.
The joint statement emphasized the risks associated with lack of access for the PCAOB to inspect auditors and audit work papers in China and higher risks of fraud in emerging markets. 6 On May 18, 2020, Nasdaq filed three proposals with the SEC to (i) apply minimum offering size requirement for companies primarily operating in “Restrictive Market”, (ii) adopt a new requirement relating to the qualification of management or board of director for Restrictive Market companies, and (iii) apply additional and more stringent criteria to an applicant or listed company based on the qualifications of the company’s auditors.
The deadline for public comments on the Security Administration Draft was December 13, 2021. As of the date of this report, we have not received any notice from any PRC authorities identifying our PRC subsidiary as a CIIO or requiring us to go through cybersecurity review or network data security review by the CAC.
As of the date of this annual report, we have not received any notice from any PRC authorities identifying our PRC subsidiary as a CIIO or requiring us to go through cybersecurity review or network data security review by the CAC.
The Cybersecurity Review Measures further requires that network platform operators that possess personal information of more than one million users must apply for a mandatory cybersecurity review before conducting listings in foreign countries. 2 On November 14, 2021, the CAC published the Network Data Security Administration Draft , or the “Security Administration Draft”, which provides that data processing operators engaging in data processing activities that affect or may affect national security or that processing personal information of more than one million users must be subject to network data security review by the relevant Cyberspace Administration of the PRC.
On November 14, 2021, the CAC published the Network Data Security Administration Draft , or the “Security Administration Draft”, which provides that data processing operators engaging in data processing activities that affect or may affect national security or that processing personal information of more than one million users must be subject to network data security review by the relevant Cyberspace Administration of the PRC.
If (i) we do not receive or maintain such permissions or approvals, (ii) we inadvertently conclude that such permissions or approvals are not required, or (iii) applicable PRC laws, regulations, or interpretations change and we are required to obtain such permissions or approvals in the future, we may be subject to fines or other penalties, including suspension of business and revocation of prerequisite licenses, which could result in a material change in our operations, and may have a material adverse effect on our business, financial condition or results of operations, and the value of our Ordinary Shares could depreciate significantly or become worthless.
If (i) we do not receive or maintain such permissions or approvals, (ii) we inadvertently conclude that such permissions or approvals are not required, or (iii) applicable PRC laws, regulations, or interpretations change and we are required to obtain such permissions or approvals in the future, we may be subject to fines or other penalties, including suspension of business and revocation of prerequisite licenses, which could result in a material change in our operations, and may have a material adverse effect on our business, financial condition or results of operations, and the value of our Class A Ordinary Shares could depreciate significantly or become worthless. 5 You may experience difficulties in effecting service of legal process, enforcing foreign judgments, or bringing actions in mainland China against us or our management based on foreign laws, compared to doing so in your home country against a domestic defendant.
Any new laws and regulations issued by the PRC authorities may subject us to additional compliance requirements. We cannot assure you that we will be able to comply with all the new regulatory requirements, or any future implementing rules on a timely basis, or at all.
We cannot assure you that we will be able to comply with all the new regulatory requirements, or any future implementing rules on a timely basis, or at all.
As a result, the labor costs for the three most recent fiscal years continued to decrease, amounting to US$4.31 million, US$2.87 million and US$2.49 million for the fiscal years ended March 31, 2022, 2023 and 2024, respectively, representing 21.9%, 17.7% and 23.0% of our total cost of revenue, respectively.
The labor costs for the three most recent fiscal years amounted to US$2.87 million, US$2.49 million, and US$3.07 million for the fiscal years ended March 31, 2023, 2024, and 2025, respectively, representing 17.7%, 23.0%, and 24.3% of our total cost of revenue, respectively.
Such uncertainties, including uncertainties over the scope and effect of our contractual, property (including intellectual property) and procedural rights, and any failure to respond to changes in the regulatory environment in China could materially and adversely affect our business and impede our ability to continue our operations, and cause the value of our securities to significantly decline or become worthless.
Such uncertainties, including uncertainties over the scope and effect of our contractual, property (including intellectual property) and procedural rights, and any failure to respond to changes in the regulatory environment in China could materially and adversely affect our business and impede our ability to continue our operations, and cause the value of our securities to significantly decline or become worthless. 2 Recent greater oversight by the Cyberspace Administration of China (the “CAC”) over cybersecurity and data security, particularly for companies seeking to list on a foreign exchange, could adversely impact our business.
Under the Individual Foreign Exchange Rules, any mainland China individual seeking to make a direct investment overseas or engage in the issuance or trading of negotiable securities or derivatives overseas must make the appropriate registrations in accordance with SAFE provisions, the failure of which may subject such mainland China individual to warnings, fines, or other liabilities.
Under the Individual Foreign Exchange Rules, any mainland China individual seeking to make a direct investment overseas or engage in the issuance or trading of negotiable securities or derivatives overseas must make the appropriate registrations in accordance with SAFE provisions, the failure of which may subject such mainland China individual to warnings, fines, or other liabilities. 10 We may not be informed of the identities of all the mainland China residents holding direct or indirect interest in our company, and we have no control over any of our future beneficial owners.
On February 17, 2023, the CSRC promulgated the Trial Measures and five (5) supporting guidelines, which came into effect on March 31, 2023.
On February 17, 2023, the China Securities Regulatory Commission (the “CSRC”) promulgated the Trial Measures and certain supporting guidelines, which came into effect on March 31, 2023.
Our current and former auditors are both subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess an auditor’s compliance with the applicable professional standards, and have been inspected by the PCAOB on a regular basis.
Our current and former auditors are both subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess an auditor’s compliance with the applicable professional standards, and have been inspected by the PCAOB. As such, as of the date of this annual report, our offering is not affected by the HFCAA and related regulations.
China’s economy has experienced increases in labor costs in recent years. China’s overall economy and the average wage in China are expected to continue to grow. The average wage level for our employees has also increased in recent years. We expect that our labor costs, including wages and employee benefits, will continue to increase.
Increases in labor costs in the PRC may adversely affect our business and our profitability. China’s economy has experienced increases in labor costs in recent years. China’s overall economy and the average wage in China are expected to continue to grow. The average wage level for our employees has also increased in recent years.
We may also be subject to fines and penalties if we fail to comply, which could adversely affect our businesses, result of operations and financial conditions. 8 PRC regulations relating to offshore investment activities by mainland China residents may subject our mainland China resident beneficial owners or our PRC subsidiary to liability or penalties, limit our ability to inject capital into our PRC subsidiary, limit our PRC subsidiary’s ability to increase its registered capital or distribute profits to us.
PRC regulations relating to offshore investment activities by mainland China residents may subject our mainland China resident beneficial owners or our PRC subsidiary to liability or penalties, limit our ability to inject capital into our PRC subsidiary, limit our PRC subsidiary’s ability to increase its registered capital or distribute profits to us.
Pursuant to the relevant laws, an enterprise is required, within a prescribed time limit, to register with the relevant social security authority and housing fund management center, and to open the relevant accounts and make timely contributions for their employees; failure to do so may subject the enterprise to order for rectification, and certain fines if the enterprise fails to rectify in time.
Business Overview-Regulations-Regulations Relating to Labor Protection.” The requirement of social insurance and housing fund has not been implemented consistently by the local governments in China given the different levels of economic development in different locations. 9 Pursuant to the relevant laws, an enterprise is required, within a prescribed time limit, to register with the relevant social security authority and housing fund management center, and to open the relevant accounts and make timely contributions for their employees; failure to do so may subject the enterprise to order for rectification, and certain fines if the enterprise fails to rectify in time.
Employee errors, even if promptly discovered and remediated, may result in unauthorized disclosure of confidential information, and our systems may be otherwise compromised, malfunction or disabled; therefore, in such events, we could suffer a disruption of our business, financial losses, liability to clients, regulatory sanctions, and damage to our reputation.
Employee errors, even if promptly discovered and remediated, may result in unauthorized disclosure of confidential information, and our systems may be otherwise compromised, malfunction or disabled; therefore, in such events, we could suffer a disruption of our business, financial losses, liability to clients, regulatory sanctions, and damage to our reputation. 8 If a cybersecurity incident occurs, or is perceived to occur, we may have to spend significant capital and other resources to mitigate the impact of the event and to develop and implement protection to prevent future events of such nature from occurring.
However, we cannot assure you that we will not become subject to the filing requirements in the future, if the CSRC issues any further guidelines that otherwise subjects us to them.
Based on such notice by the CSRC, we believe we are not required to undertake the relevant filing and reporting requirements as stipulated in the Trial Measures. However, we cannot assure you that we will not become subject to the filing requirements in the future, if the CSRC issues any further guidelines that otherwise subjects us to them.
These measures may cause decreased economic activities in China, which may adversely affect our business and operating results. 1 Furthermore, we and our Chinese subsidiary, as well as our investors, face uncertainty about future actions by the Chinese government that could significantly affect our financial performance and operations.
Furthermore, we and our Chinese subsidiary, as well as our investors, face uncertainty about future actions by the Chinese government that could significantly affect our financial performance and operations.
As of the date of this report, as the CSRC notified us in writing that we do not fall within the scope of the filing requirements under the Trial Measures, we believe that we are not required to obtain permission or approvals from the competent Chinese authorities for the listing and trading of our Ordinary Shares on U.S. exchanges.
Risk Factors—Risks relating to doing business in China—The CSRC’s Trial Measures and other relevant rules promulgated by the CSRC may subject us to additional compliance requirements in the future.” In connection with our initial public offering, the CSRC notified us in writing on November 6, 2023 that we do not fall within the scope of the filing requirements under the Trial Measures, therefore, as of the date of this annual report, we believe that we are not required to obtain permission or approvals from the competent Chinese authorities, including the CSRC, for the listing and trading of our Class A Ordinary Shares on U.S. exchanges.
In addition, in the past the Chinese government has implemented certain measures, including interest rate adjustments, to control the pace of economic growth.
In addition, in the past the Chinese government has implemented certain measures, including interest rate adjustments, to control the pace of economic growth. These measures may cause decreased economic activities in China, which may adversely affect our business and operating results.
As a company incorporated under the laws of the Cayman Islands, we conduct a majority of our operations in China and a majority of our assets are located in China.
It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within mainland China. As a company incorporated under the laws of the Cayman Islands, we conduct a majority of our operations in China and a majority of our assets are located in China.
Recent greater oversight by the CAC over cybersecurity and data security, particularly for companies seeking to list on a foreign exchange, could adversely impact our business. On December 28, 2021, the CAC, together with 12 other governmental departments of the PRC, jointly promulgated the Cybersecurity Review Measures , which became effective on February 15, 2022.
On December 28, 2021, the CAC, together with 12 other governmental departments of the PRC, jointly promulgated the Cybersecurity Review Measures , which became effective on February 15, 2022.
We intend to pay the outstanding social insurance and housing fund payments upon receipt of notice from the competent PRC authorities.
We intend to pay the outstanding social insurance and housing fund payments upon receipt of notice from the competent PRC authorities. We may also be subject to fines and penalties if we fail to comply, which could adversely affect our businesses, result of operations and financial conditions.
Removed
The Chinese economy differs from the economies of most developed countries in many respects, including the level of government involvement, level of development, growth rate, control of foreign exchange, and allocation of resources.
Added
Pursuant to the Trial Measures, a PRC domestic company that seeks to offer or list securities overseas, both directly and indirectly, shall submit the filing materials with the CSRC as required by the Trial Measures within three (3) business days following its submission of an application to overseas securities regulatory authorities for its initial public offering or listing, and once listed, report to the CSRC of any follow-on offerings upon the completion of such follow-on offering.
Removed
Although the Chinese government has implemented measures emphasizing the utilization of market forces for economic reform, including the reduction of state ownership of productive assets and the establishment of improved corporate governance in business enterprises, a substantial portion of productive assets in China is still owned by the government.
Added
The Cybersecurity Review Measures further requires that network platform operators that possess personal information of more than one million users must apply for a mandatory cybersecurity review before conducting listings in foreign countries.
Removed
Failure to take timely and appropriate measures to adapt to any of these or similar regulatory compliance challenges could materially and adversely affect our current corporate structure and business operations.
Added
The official version of the Regulation for the Administration of Network Data Security (the “Network Data Security Regulation”) was promulgated on September 24, 2024 and came into effect on January 1, 2025, which deletes the requirement for a mandatory application of cybersecurity review for data processing operators who possess personal data of at least one million users, as stated above.
Removed
Since this announcement is relatively new, uncertainties still exist in relation to how soon legislative or administrative regulation making bodies will respond and what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any, and the potential impact such modified or new laws and regulations will have on companies like us and our Ordinary Shares.
Added
Instead, it requires that a network data handler who carries out network data processing activities that affect or may affect national security, shall undergo a national security review in accordance with relevant national regulations.
Removed
As of the date of this annual report, there was no material change to these regulations and policies since our initial public offering.
Added
The CSRC’s Trial Measures and other relevant rules promulgated by the CSRC may subject us to additional compliance requirements in the future. On February 17, 2023, the CSRC promulgated the Trial Measures and five (5) supporting guidelines, which came into effect on March 31, 2023.
Removed
You may experience difficulties in effecting service of legal process, enforcing foreign judgments, or bringing actions in mainland China against us or our management based on foreign laws, compared to doing so in your home country against a domestic defendant. It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within mainland China.
Added
Once listed, such PRC domestic company is required to report to the CSRC within three (3) business days upon the completion of any follow-on offerings.
Removed
While detailed interpretation of or implementing rules under Article 177 have yet to be promulgated, the inability for an overseas securities regulator to directly conduct investigation or evidence collection activities within mainland China may further increase difficulties faced by you in protecting your interests.
Added
Furthermore, the Trial Measures provide that overseas securities regulatory authorities may conduct investigations or evidence collection relating to PRC domestic companies’ overseas offering and listing activities through the assistance of the CSRC under relevant cross-border securities regulatory cooperation mechanisms.
Removed
The joint statement emphasized the risks associated with lack of access for the PCAOB to inspect auditors and audit work papers in China and higher risks of fraud in emerging markets.
Added
Accordingly, without regulatory cooperation between the U.S. and China, no entity or individual in mainland China may provide documents and information relating to securities business activities to overseas regulators when it is under direct investigation or evidence discovery conducted by overseas regulators, which could present significant legal and other obstacles to obtaining information needed for investigations and litigation conducted outside of mainland China.
Removed
As such, as of the date of this annual report, our offering is not affected by the HFCAA and related regulations.
Added
On November 1, 2024, the Company appointed Enrome LLP as its independent registered public accounting firm in place of MarcumAsia, effective immediately. Enrome LLP , whose audit report is included in this annual report on Form 20-F, is headquartered in Singapore.
Removed
If a cybersecurity incident occurs, or is perceived to occur, we may have to spend significant capital and other resources to mitigate the impact of the event and to develop and implement protection to prevent future events of such nature from occurring.
Added
We expect that our labor costs, including wages and employee benefits, will continue to increase.
Removed
For more details, please see “Item 4. Information on the Company—B. Business Overview—Regulations—Regulations Relating to Labor Protection.” The requirement of social insurance and housing fund has not been implemented consistently by the local governments in China given the different levels of economic development in different locations.
Added
For more details, please see “Item 4. Information on the Company-B.
Removed
We may not be informed of the identities of all the mainland China residents holding direct or indirect interest in our company, and we have no control over any of our future beneficial owners.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

91 edited+21 added−11 removed196 unchanged
Value-Added Tax (“VAT”) Pursuant to the Interim Regulations on Value-added Tax of the PRC promulgated by the State Council on December 13, 1993 and were recently amended on November 19, 2017, and the Detailed Rules on the Implementation of Interim Regulation on Value-added Tax of the PRC promulgated by the Ministry of Finance, or the MOF, on December 25, 1993 and were recently amended on October 28, 2011, collectively the VAT Laws, all entities and individuals in mainland China engaging in the sales of goods, provision of processing services, repairs and replacement services, sales services, intangible assets, real estate and the importation of goods are required to pay VAT at the rate of 17%, unless otherwise stated.
Value-Added Tax (“VAT”) Pursuant to the Interim Regulations on Value-added Tax of the PRC promulgated by the State Council on December 13, 1993 and were recently amended on November 19, 2017, and the Detailed Rules on the Implementation of Interim Regulation on Value-added Tax of the PRC promulgated by the Ministry of Finance, or the MOF, on December 25, 1993 and were recently amended on October 28, 2011, collectively the VAT Regulations, all entities and individuals in mainland China engaging in the sales of goods, provision of processing services, repairs and replacement services, sales services, intangible assets, real estate and the importation of goods are required to pay VAT at the rate of 17%, unless otherwise stated.
Products We manufacture a broad portfolio of interconnect products, including connectors, cables and wire harnesses for various end applications in a set of diversified industries, including industrial, medical equipment, computer, network and communication, automotive, robotic, and consumer appliance. Connectors Connectors are electromechanical devices used to join electrical conductors and create electrical circuits.
Products We manufacture a broad portfolio of interconnect products, including connectors, cables and wire harnesses for various end applications in a set of diversified industries, including industrial, medical equipment, computer, network and communication, automotive, robotic, and consumer appliance. 36 Connectors Connectors are electromechanical devices used to join electrical conductors and create electrical circuits.
As of the date of this report, we have a diversified global customer base located in more than 25 countries throughout Asia, Europe and the Americas. Interconnect products are essential components that form physical or logical connections between two electronic devices or networks.
As of the date of this annual report, we have a diversified global customer base located in more than 25 countries throughout Asia, Europe and the Americas. Interconnect products are essential components that form physical or logical connections between two electronic devices or networks.
Additionally, in order to better service our growing customer base in Europe, in 2016, we established our Netherlands subsidiary, CCSC Interconnect NL, which has since served as our Europe logistics and service hub. 31 We seek to deliver quality products at competitive prices through a vertically integrated production process.
Additionally, in order to better service our growing customer base in Europe, in 2016, we established our Netherlands subsidiary, CCSC Interconnect NL, which has since served as our Europe logistics and service hub. We seek to deliver quality products at competitive prices through a vertically integrated production process.
Network cable Network and communication Computer server, switch, router To meet high transmission rate up to 10 Gigabit Ethernet standard with low latency time in order to let our customer product transfer and receive picture, voice, data signal in fast speed and high accuracy Robotic cable and wire harness Robotic Robotic arm High AC voltage (600V, 1000V and 2000V), and high flexibility (our cables and wire harnesses can achieve the bending test at180 degree for 10,000 times or more. 35 Customers We manufacture and sell a broad portfolio of interconnect products to customers in various industries in more than 25 countries throughout Asia, Europe and the Americas.
Network cable Network and communication Computer server, switch, router To meet high transmission rate up to 10 Gigabit Ethernet standard with low latency time in order to let our customer product transfer and receive picture, voice, data signal in fast speed and high accuracy Robotic cable and wire harness Robotic Robotic arm High AC voltage (600V, 1000V and 2000V), and high flexibility (our cables and wire harnesses can achieve the bending test at180 degree for 10,000 times or more. 38 Customers We manufacture and sell a broad portfolio of interconnect products to customers in various industries in more than 25 countries throughout Asia, Europe and the Americas.
Pursuant to which, “domain name” shall refer to the character mark of hierarchical structure, which identifies and locates a computer on the internet and corresponds to the internet protocol (IP) address of that computer. Unless otherwise provided in relevant rules, the principle of “first-to-file” is applied to domain name registration service.
Pursuant to which, “domain name” shall refer to the character mark of hierarchical structure, which identifies and locates a computer on the internet and corresponds to the internet protocol (IP) address of that computer. 48 Unless otherwise provided in relevant rules, the principle of “first-to-file” is applied to domain name registration service.
Domain name registrations are handled through domain name service agencies established under the relevant regulations, and applicants become domain name holders upon successful registration. As of the date of this report, CCSC Interconnect DG currently holds one registered domain name in mainland China, ccsc-interconnect.com.
Domain name registrations are handled through domain name service agencies established under the relevant regulations, and applicants become domain name holders upon successful registration. As of the date of this annual report, CCSC Interconnect DG currently holds one registered domain name in mainland China, ccsc-interconnect.com.
As of the date of this report, CCSC Interconnect DG has not made adequate social insurance contributions to their employees, which may subject it to make up such shortfalls or fines, see “ Item 3. Key Information—D.
As of the date of this annual report, CCSC Interconnect DG has not made adequate social insurance contributions to their employees, which may subject it to make up such shortfalls or fines, see “ Item 3. Key Information-D.
As of the date of this report, CCSC Interconnect DG does not have any registered trademarks in mainland China. Patent Patents in the PRC are principally protected under the Patent Law of the PRC (2020 Revision) and its Implementation Rules (2010 Revision), collectively the Patent Laws.
As of the date of this annual report, CCSC Interconnect DG does not have any registered trademarks in mainland China. Patent Patents in the PRC are principally protected under the Patent Law of the PRC (2020 Revision) and its Implementation Rules (2010 Revision), collectively the Patent Laws.
The Circular 37 requires that, before making contribution into an SPV, mainland China residents or entities are required to complete foreign exchange registration with the SAFE or its local branch. 49 In February 2015, SAFE promulgated the SAFE Circular 13.
The Circular 37 requires that, before making contribution into an SPV, mainland China residents or entities are required to complete foreign exchange registration with the SAFE or its local branch. In February 2015, SAFE promulgated the SAFE Circular 13.
In Hong Kong, CCSC Technology Group and CCSC Interconnect HK participate in a contribution scheme, which is registered under the Mandatory Provident Fund Scheme (the “MPF Scheme”) established pursuant to the Mandatory Provident Fund Ordinance that took effect in December 2000.
In Hong Kong, CCSC Technology Group and CCSC Interconnect HK participate in a contribution scheme, which is registered under the Mandatory Provident Fund Scheme (the “MPF Scheme”) established pursuant to the Mandatory Provident Fund Schemes Ordinance that took effect in December 2000.
However, we cannot assure you that we will not become subject to the filing requirements under the Trial Measures in the future, if the CSRC issues any further guidelines that otherwise subjects us to them. 51 On February 24, 2023, the CSRC, together with the Ministry of Finance, the National Administration of State Secrets Protection and National Archives Administration of China, revised the Provisions on Strengthening Confidentiality and Archives Administration for Overseas Securities Offering and Listing, which were issued by the CSRC and National Administration of State Secrets Protection and National Archives Administration of China in 2009, or the Provisions.
However, we cannot assure you that we will not become subject to the filing requirements under the Trial Measures in the future, if the CSRC issues any further guidelines that otherwise subjects us to them. 55 On February 24, 2023, the CSRC, together with the Ministry of Finance, the National Administration of State Secrets Protection and National Archives Administration of China, revised the Provisions on Strengthening Confidentiality and Archives Administration for Overseas Securities Offering and Listing, which were issued by the CSRC and National Administration of State Secrets Protection and National Archives Administration of China in 2009, or the Provisions.
In June 2023, our HK subsidiary, CCSC Interconnect HK was certified to the Sustainable Development Goals (“SDG”) Certificate, which aligns with the “SDG 12: Responsible Consumption and Production” under United Nations Development Program. 32 Strong focus on customers’ needs and value-added services We design and manufacture products from the perspective of our customers in terms of raw material selection, functional and structural specifications, and technical requirements.
In June 2023, our HK subsidiary, CCSC Interconnect HK was certified to the Sustainable Development Goals (“SDG”) Certificate, which aligns with the “SDG 12: Responsible Consumption and Production” under United Nations Development Program. 34 Strong focus on customers’ needs and value-added services We design and manufacture products from the perspective of our customers in terms of raw material selection, functional and structural specifications, and technical requirements.
As of the date of this report, CCSC Interconnect DG currently holds 71 registered patents in mainland China, including 9 invention models and 62 utility models.
As of the date of this annual report, CCSC Interconnect DG currently holds 71 registered patents in mainland China, including 9 invention models and 62 utility models.
Any failure by us to fully comply with the new regulatory requirements may significantly limit or completely hinder our ability to offer or continue to offer our Ordinary Shares, cause significant disruption to our business operations, and severely damage our reputation, which would materially and adversely affect our financial condition and results of operations and cause our Ordinary Shares to significantly decline in value or become worthless.
Any failure by us to fully comply with the new regulatory requirements may significantly limit or completely hinder our ability to offer or continue to offer our Class A Ordinary Shares, cause significant disruption to our business operations, and severely damage our reputation, which would materially and adversely affect our financial condition and results of operations and cause our Class A Ordinary Shares to significantly decline in value or become worthless.
We have a quality control team of more than 20 employees, who carry out day-to-day quality control functions at each stage of our production process, from raw material selection, product design and development, to manufacturing and testing. Additionally, we impose stringent standards on the selection of our suppliers and subcontractors to ensure the quality of our products.
We have a quality control team of more than 29 employees, who carry out day-to-day quality control functions at each stage of our production process, from raw material selection, product design and development, to manufacturing and testing. Additionally, we impose stringent standards on the selection of our suppliers and subcontractors to ensure the quality of our products.
Our workforce is highly skilled in their specialized lines of business. We selectively recruit qualified employees, and provide continuous professional development training for our staff. We have some of the most dedicated employees. Approximately 63% of our employees have been with us for more than 5 years, and approximately 36% for more than ten years.
Our workforce is highly skilled in their specialized lines of business. We selectively recruit qualified employees, and provide continuous professional development training for our staff. We have some of the most dedicated employees. Approximately 63% of our employees have been with us for more than 5 years, and approximately 35% for more than ten years.
Section 15 of the MWO provides that any provision of employment contract which purports to extinguish or reduce the right, benefit or protection conferred on the employee under the MWO is void. 53 C. Organizational Structure The following diagram illustrates our corporate structure as of the date of this report.
Section 15 of the MWO provides that any provision of employment contract which purports to extinguish or reduce the right, benefit or protection conferred on the employee under the MWO is void. C. Organizational Structure The following diagram illustrates our corporate structure as of the date of this annual report.
As of the date of this report, the VAT rate applicable to our sales of goods by our PRC subsidiary is 13%.
As of the date of this annual report, the VAT rate applicable to our sales of goods by our PRC subsidiary is 13%.
Of the 71 patents, 9 are invention patents, which were granted to CCSC Interconnect DG in the years between 2013 and 2023, each for a duration of 20 years, commencing from the date of application and the other 62 are utility models, which were granted to CCSC Interconnect DG in the years between 2015 and 2024, each for a duration of 10 years.
Of the 71 patents, 9 are invention patents, which were granted to CCSC Interconnect DG in the years between 2013 and 2024, each for a duration of 20 years, commencing from the date of application and the other 62 are utility models, which were granted to CCSC Interconnect DG in the years between 2015 and 2025, each for a duration of 10 years.
Breach of the Work Safety Law of the PRC will incur various penalties, according to the specific circumstances. PRC Regulations Relating to Intellectual Property Trademark Registered trademarks are mainly protected under the Trademark Law of the PRC (2019 Revision) and its Implementation Rules (2014 Revision), collectively the Trademark Laws.
Breach of the Work Safety Law of the PRC will incur various penalties, according to the specific circumstances. PRC Regulations Relating to Intellectual Property Trademark Registered trademarks are mainly protected under the Trademark Law of the PRC (2019 Revision) and its Implementation Rules (2023 Revision), collectively the Trademark Laws.
For the fiscal years ended March 31, 2024, 2023 and 2022, almost all, or more than 99% of our sales were attributed to manufacturing companies and EMSs, while the remaining sales were attributed to dealers who resell interconnect products.
For the fiscal years ended March 31, 2025, 2024, and 2023, almost all, or more than 99% of our sales were attributed to manufacturing companies and EMSs, while the remaining sales were attributed to dealers who resell interconnect products.
However, no criminal liability arises from such breach of implied term. 52 Trade Descriptions The Trade Descriptions Ordinance (Chapter 362 of the Laws of Hong Kong) prohibits false descriptions, false, misleading or incomplete information in respect of goods in the course of trade.
However, no criminal liability arises from such breach of implied term. 56 Trade Descriptions The Trade Descriptions Ordinance (Chapter 362 of the Laws of Hong Kong) prohibits false descriptions, false, misleading or incomplete information in respect of goods in the course of trade.
Our product research and development capabilities have been a cornerstone of our success. Our engineering team that is responsible for product research and development currently has 40 employees, many of whom are experienced mechanical and electrical engineers.
Our product research and development capabilities have been a cornerstone of our success. Our engineering team that is responsible for product research and development currently has 20 employees, many of whom are experienced mechanical and electrical engineers.
Risk Factors—Risks relating to doing business in China—The New Overseas Listing Rules and other relevant rules promulgated by the CSRC may subject us to additional compliance requirements in the future. ” Hong Kong Laws and Regulations Our Hong Kong subsidiary, CCSC Interconnect HK, engages in the trading of electronic products and is subject to relevant Hong Kong laws and regulations.
Risk Factors-Risks relating to doing business in China-The CSRC’s Listing Rules and other relevant rules promulgated by the CSRC may subject us to additional compliance requirements in the future. ” Hong Kong Laws and Regulations Our Hong Kong subsidiary, CCSC Interconnect HK, engages in the trading of electronic products and is subject to relevant Hong Kong laws and regulations.
We own all of the equipment and machinery such as computerized vertical injection machine, low pressure injection machine, automatic cable cutting & stripping machine, automatic wire printing machine, automatic crimping machine, automatic soldering machine, automatic sealing machine, laser welding machine, laser engrave machine, automatic wire twisting machine, automatic cable winding machine, automatic shrink film packing machine, PCBA de-panel machine at our factory, which were valued at approximately $0.20 million as of March 31, 2024, net of depreciation costs.
We own all of the equipment and machinery such as computerized vertical injection machine, low pressure injection machine, automatic cable cutting & stripping machine, automatic wire printing machine, automatic crimping machine, automatic soldering machine, automatic sealing machine, laser welding machine, laser engrave machine, automatic wire twisting machine, automatic cable winding machine, automatic shrink film packing machine, PCBA de-panel machine at our factory, which were valued at approximately $0.85 million as of March 31, 2025, net of depreciation costs.
Below is a tabular illustration of our sales with respect to our geographic coverage for the fiscal years ended March 31, 2024, 2023 and 2022.
Below is a tabular illustration of our sales with respect to our geographic coverage for the fiscal years ended March 31, 2025, 2024, and 2023.
Pursuant to the Trial Measures, a PRC domestic company that seeks to offer or list securities overseas, both by direct and indirect means, shall submit the filing materials with the CSRC as required by the Trial Measures within three (3) business days following its submission of an application with oversea securities regulatory authorities for its initial public offering or listing.
Pursuant to the Trial Measures, a PRC domestic company that seeks to offer or list securities overseas, both by direct and indirect means, shall submit the filing materials with the CSRC as required by the Trial Measures within three (3) business days following its submission of an application with oversea securities regulatory authorities for its IPO or listing.
If the CSRC or other PRC regulatory agencies subsequently determine that prior CSRC approvals are required regarding our initial public offering, we may face regulatory actions or other sanctions from the CSRC or other PRC regulatory agencies. On February 17, 2023, the CSRC promulgated the Trial Measures and five (5) supporting guidelines, which came into effect on March 31, 2023.
If the CSRC or other PRC regulatory agencies subsequently determine that prior CSRC approvals are required regarding our IPO, we may face regulatory actions or other sanctions from the CSRC or other PRC regulatory agencies. On February 17, 2023, the CSRC promulgated the Trial Measures and five (5) supporting guidelines, which came into effect on March 31, 2023.
Although we do not directly procure raw materials, our business depends on a stable supply of such raw materials such as copper, zinc, and aluminium that are required for the manufacture of our components. 37 Our components are mainly sourced from suppliers located in the PRC, Hong Kong, Taiwan and Europe.
Although we do not directly procure raw materials, our business depends on a stable supply of such raw materials such as copper, zinc, and aluminum that are required for the manufacture of our components. 40 Our components are mainly sourced from suppliers located in the PRC, Hong Kong, Taiwan and Europe.
Risk Factors—Risks relating to doing business in China—Our PRC subsidiary has not made adequate social insurance and housing fund contributions for all employees as required by PRC regulations, which may subject us to penalties . ” PRC Regulations Relating to Taxation Enterprise Income Tax (“EIT”) Pursuant to the PRC EIT Law, which was promulgated by the SCNPC on March 16, 2007 and last amended on December 29, 2018, and its implementation rules, including the Regulations on the Implementation of Enterprise Income Tax Law of the PRC which was promulgated by the State Council on December 6, 2007 and last amended on April 23, 2019, EIT shall be applicable at a uniform rate of 25% to both resident or non-resident enterprises.
Risk Factors-Risks relating to doing business in China-Our PRC subsidiary has not made adequate social insurance and housing fund contributions for all employees as required by PRC regulations, which may subject us to penalties . ” PRC Regulations Relating to Taxation Enterprise Income Tax (“EIT”) Pursuant to the PRC EIT Law, which was promulgated by the SCNPC on March 16, 2007 and last amended on December 29, 2018, and its implementation rules, including the Regulations on the Implementation of Enterprise Income Tax Law of the PRC which was promulgated by the State Council on December 6, 2007 and last amended on December 6, 2024 and effective on January 20, 2025, EIT shall be applicable at a uniform rate of 25% to both resident or non-resident enterprises.
On January 22, 2024, the Company closed its initial public offering of 1,375,000 Ordinary Shares pursuant to certain registration statements on Form F-1 (File Nos.333-270741 and 333-276545). Revere Securities, LLC and R.F. Lafferty & Co., Inc. were the underwriters of the Company’s initial public offering.
On January 22, 2024, the Company closed its IPO of 1,375,000 ordinary shares pursuant to certain registration statements on Form F-1 (File Nos.333-270741 and 333-276545). Revere Securities, LLC and R.F. Lafferty & Co., Inc. were the underwriters of the Company’s IPO.
We do not foresee any material impact on our business when they expire in the future, the earliest of which will be on August 7, 2024. CCSC Interconnect HK was granted an irrevocable exclusive license to use 13 trademarks by a company held by one of its shareholders for a term of ten years commencing from June 1, 2020.
We do not foresee any material impact on our business when they expire in the future, the earliest of which will be on July 22, 2025. CCSC Interconnect HK was granted an irrevocable exclusive license to use 13 trademarks by a company held by one of its shareholders for a term of ten years commencing from June 1, 2020.
As of the date of this report, our engineering department has a total of 40 employees with extensive experiences in mechanical and electronic engineering, as well as product design and development.
As of the date of this annual report, our engineering department has a total of 20 employees with extensive experiences in mechanical and electronic engineering, as well as product design and development.
As the result of the reorganization, CCSC Cayman became the ultimate holding company of CCSC Group, CCSC Technology Group and its subsidiaries. The Ordinary Shares of the Company commenced trading under the symbol “CCTG” on the Nasdaq Capital Market on January 18, 2024.
As the result of the reorganization, CCSC Cayman became the ultimate holding company of CCSC Group, CCSC Technology Group and its subsidiaries. IPO in January 2024 The Class A Ordinary Shares of the Company commenced trading under the symbol “CCTG” on the Nasdaq Capital Market on January 18, 2024.
Our customers include both manufacturing companies and electronic manufacturing services (“EMS”) companies, who procure and assemble products on behalf of manufacturing companies. Additionally, a tiny fraction, or less than 1% of our sales for the fiscal years 2024, 2023 and 2022, was attributed to dealers who resell our products to manufacturing companies.
Our customers include both manufacturing companies and electronic manufacturing services (“EMS”) companies, who procure and assemble products on behalf of manufacturing companies. Additionally, a tiny fraction, or less than 1% of our sales for the fiscal years ended March 31, 2025, 2024, and 2023, was attributed to dealers who resell our products to manufacturing companies.
Type of cable and wire harness Industry End Application Technical requirements/Specification Waterproof cable Industrial Compressor in refrigerate container, industrial freezer, outdoor lighting cable Waterproof capability meeting the requirement of the IPX7 industrial standard, which certifies that cables and wire harnesses can be submerged under up to one meter of water for 30 minutes and allows the end products to work safely and properly under harsh environmental conditions (i.e. typhoon with heavy raining).
The below table illustrates some of our cable and wire harness products and their applications. 37 Type of cable and wire harness Industry End Application Technical requirements/Specification Waterproof cable Industrial Compressor in refrigerate container, industrial freezer, outdoor lighting cable Waterproof capability meeting the requirement of the IPX7 industrial standard, which certifies that cables and wire harnesses can be submerged under up to one meter of water for 30 minutes and allows the end products to work safely and properly under harsh environmental conditions (i.e. typhoon with heavy raining).
We have and will continue to attend the Electronica trade fair for the electronics industry held once in every two years in Munich, Germany, which event is attended by many of our existing and potential customers. We also attended the Electronica China 2023 trade fair in Shanghai, PRC.
We have and will continue to attend the Electronica trade fair for the electronics industry held once in every two years in Munich, Germany, which event is attended by many of our existing and potential customers.
CCSC Interconnect DG has obtained the HNTE accreditation since 2016, which was recently renewed on December 22, 2022, and can enjoy a preferential income tax rate of 15% rather than the unified rate of 25% for years of 2022-2024.
CCSC Interconnect DG has obtained the HNTE accreditation since 2016, which was last renewed on December 22, 2022, and has received a preferential income tax rate of 15% rather than the unified rate of 25% for years 2022-2024.
Our warranty cost for each of the fiscal years 2024, 2023 and 2022 was $0. 38 Sales and Marketing We believe the best marketing is through: (1) making quality products that consistently meet and exceed customer expectations, and (2) providing excellent customer services to establish long-term relationships with satisfied customers.
Our warranty cost for each of the fiscal years ended March 31, 2025, 2024, and 2023 was $0. 41 Sales and Marketing We believe the best marketing is through: (1) making quality products that consistently meet and exceed customer expectations, and (2) providing excellent customer services to establish long-term relationships with satisfied customers.
According to the Circular on Policies to Deepen Value-added Tax Reform, which was promulgated by the MOF, the SAT and the General Administration of Customs on March 20, 2019 and became effective on April 1, 2019, where a taxpayer engages in a taxable sales activity for the value-added tax purpose or importation of goods, the previous applicable 16% and 10% tax rates are lowered to 13% and 9%, respectively.
According to the Circular on Adjusting Value-added Tax Rates, which was promulgated by the MOF and the State Administration of Taxation, or the SAT, on April 4, 2018 and became effective on May 1, 2018, where a taxpayer engages in a taxable sales activity for the value-added tax purpose or importation of goods, the previous applicable 17% and 11% tax rates are lowered to 16% and 10%, respectively. 50 According to the Circular on Policies to Deepen Value-added Tax Reform, which was promulgated by the MOF, the SAT and the General Administration of Customs on March 20, 2019 and became effective on April 1, 2019, where a taxpayer engages in a taxable sales activity for the value-added tax purpose or importation of goods, the previous applicable 16% and 10% tax rates are lowered to 13% and 9%, respectively.
We believe our management team is well positioned to lead us through the development and commercialization of new products, while maintaining and improving the market position of our existing products. Our revenue was $14,748,551, $24,059,556 and $27,169,935, for the fiscal years ended March 31, 2024, 2023 and 2022, respectively.
We believe our management team is well positioned to lead us through the development and commercialization of new products, while maintaining and improving the market position of our existing products. Our revenue was $17,631,489 , $14,748,551, and $24,059,556, for the fiscal years ended March 31, 2025, 2024, and 2023, respectively.
Real Property Locations Approximate Square Feet Use Owned or Leased (term of lease) No. 50, Puxing West Road, Yuliangwei Village, Shenzhen Shangsha Qingxi Industrial Park of Yuliangwei Management Area, Qingxi Town, Dongguan, Guangdong Province, PRC 189,983 Factory and staff quarter Leased (from September 2022 to August 2027) 1301-1303, 13/f, Shatin Galleria, 18-24 Shan Mei Street, Fotan, Shatin, Hong Kong 2,555 Head office Leased (from November 2023 to November 2025) Klompenmakerstraat 16a, 2984BB Ridderkerk, the Netherlands 5,113 Office and warehouse Leased (from January 2019 to May 2025) Total 196,507 40 Legal Proceedings We are currently not a party to any material legal or administrative proceedings.
We believe that our facilities are suitable and adequate for our operations and are adequately maintained. 43 Real Property Locations Approximate Square Feet Use Owned or Leased (term of lease) No. 50, Puxing West Road, Yuliangwei Village, Shenzhen Shangsha Qingxi Industrial Park of Yuliangwei Management Area, Qingxi Town, Dongguan, Guangdong Province, PRC 189,983 Factory and staff quarter Leased (from September 2022 to August 2027) 1301-1303, 13/f, Shatin Galleria, 18-24 Shan Mei Street, Fotan, Shatin, Hong Kong 2,555 Head office Leased (from November 2023 to November 2025) Klompenmakerstraat 16a, 2984BB Ridderkerk, the Netherlands 5,113 Office and warehouse Leased (from January 2019 to May 2028) Total 19 7,651 Legal Proceedings We are currently not a party to any material legal or administrative proceedings.
Our employees are not covered by any collective bargaining agreement. We believe that we maintain a good working relationship with our employees, and we have not experienced any significant labor disputes. Properties and Facilities We maintain the below facilities. We believe that our facilities are suitable and adequate for our operations and are adequately maintained.
Our employees are not covered by any collective bargaining agreement. We believe that we maintain a good working relationship with our employees, and we have not experienced any significant labor disputes. Properties and Facilities We maintain the below facilities.
Type of connector Industry End Application/Products Description Board to Board Computer, network and communication, consumer appliances, medical Personal computer and server, telecom switches, video conference equipment; networking equipment (modem, router, switch, network attached storage) Connect signals between two printed circuit boards (“PCB”) without a cable Wire to Board Industrial, medical equipment, consumer appliances Power supply, electric actuator for hospital bed, computer mainboard, lighting equipment for architecture lighting and concert lighting, washing machine, coffee machine, television Connect wires to a printed circuit board (“PCB”) Power Robotic, industrial, automotive Robot arm, industrial freezer for truck, lighting equipment for architecture lighting and concert lighting, industrial equipment power supply, automotive audio, car seat heating, car headlight Connect devices to power sources Input Output Industrial, consumer appliance Computer equipment and peripheral set top box, robotic arms, smart devices and modules Connect external devices, such as printers, keyboards, and displays to servers. 34 Cables and Wire harness Cables and wire harnesses are devices used to transmit electric or magnetic energy, exchange information, generate electromagnetic energy conversion, and form automated control route.
Type of connector Industry End Application/Products Description Board to Board Computer, network and communication, consumer appliances, medical Personal computer and server, telecom switches, video conference equipment; networking equipment (modem, router, switch, network attached storage) Connect signals between two printed circuit boards (“PCB”) without a cable Wire to Board Industrial, medical equipment, consumer appliances Power supply, electric actuator for hospital bed, computer mainboard, lighting equipment for architecture lighting and concert lighting, washing machine, coffee machine, television Connect wires to a printed circuit board (“PCB”) Power Robotic, industrial, automotive Robot arm, industrial freezer for truck, lighting equipment for architecture lighting and concert lighting, industrial equipment power supply, automotive audio, car seat heating, car headlight Connect devices to power sources Input Output Industrial, consumer appliance Computer equipment and peripheral set top box, robotic arms, smart devices and modules Connect external devices, such as printers, keyboards, and displays to servers.
A reorganization of the Company’s structure was completed on March 17, 2022. The reorganization involved the incorporation of the Company and CCSC Group and the transfer of the 100% shareholding interest of CCSC Technology Group from its individual shareholders to CCSC Group.
Prior to the reorganization described below, CCSC Technology Group was controlled by several individual shareholders. A reorganization of the Company’s structure was completed on March 17, 2022. The reorganization involved the incorporation of the Company and CCSC Group and the transfer of the 100% shareholding interest of CCSC Technology Group from its individual shareholders to CCSC Group.
In July 2023, CCSC Interconnect DG was selected by the Ministry of Industry and Information Technology (MIIT) of China as a “Specialized Refinement Differential Innovation Little Giant Enterprise”, a recognition given to small and medium-sized enterprises that specialize in niche sectors and boast strong innovative capability.
CCSC Interconnect DG is currently renewing its HNTE accreditation for years of 2025-2027. In July 2023, CCSC Interconnect DG was selected by the Ministry of Industry and Information Technology (MIIT) of China as a “Specialized Refinement Differential Innovation Little Giant Enterprise”, a recognition given to small and medium-sized enterprises that specialize in niche sectors and boast strong innovative capability.
PRC Regulations Relating to Foreign Investment The Market Entrance Rules for Foreign Investment Market entrance for investment activities in mainland China by foreign investors is mainly governed by the Guidance Catalogue of Encouraged Industries for Foreign Investment (2020 Version), or the Catalogue, which was promulgated by the Ministry of Commerce, or the MOFCOM, and the National Development and Reform Commission, or the NDRC, on December 27, 2020, and became effective on January 27, 2021, and the Special Administrative Measures (Negative List) for the Entrance of Foreign Investment (2021 Version), or the Negative List, which was promulgated by the MOFCOM and the NDRC on December 27, 2021 and became effective on January 1, 2022.
PRC Regulations Relating to Foreign Investment The Market Entry Rules for Foreign Investment Market entry for investment activities in mainland China by foreign investors is mainly governed by the Guidance Catalogue of Encouraged Industries for Foreign Investment (2022 Version), or the Catalogue, which was promulgated by the Ministry of Commerce, or the MOFCOM, and the National Development and Reform Commission, or the NDRC, on October 26, 2022, and became effective on January 1, 2023, and the Special Administrative Measures (Negative List) for the Entrance of Foreign Investment (2024 Version), or the Negative List, which was promulgated by the MOFCOM and the NDRC on September 6, 2024 and became effective on November 1, 2024.
For the fiscal years ended March 31, 2023 and 2022, no supplier accounted for more than 10% of our total purchases. Production Facility We operate one manufacturing plant in Dongguan, Guangdong province, China, with 189,983 square feet in the aggregate.
For the fiscal year ended March 31, 2024, there was one supplier who accounted for 12.1% of the total purchases. For the fiscal years ended March 31, 2023, no supplier accounted for more than 10% of our total purchases. Production Facility We operate one manufacturing plant in Dongguan, Guangdong province, China, with 189,983 square feet in the aggregate.
In compliance with the Trial Measures, we submitted our filing materials to the CSRC on August 31, 2023, and was informed by the CSRC in writing on November 6, 2023 that we do not fall within the scope of the filing requirements at this time.
In compliance with the Trial Measures, we submitted our filing materials relating to our IPO to the CSRC on August 31, 2023, and were informed by the CSRC in writing on November 6, 2023 that we did not fall within the scope of the filing requirements at such time.
For more detail on our corporate history please refer to “—A. History and Development of the Company.” D. Property, Plants and Equipment See “—B. Business Overview—Properties and Facilities.” Item 4A. UNRESOLVED STAFF COMMENTS Not applicable.
For more detail on our corporate history please refer to “-A. History and Development of the Company.” D. Property, Plants and Equipment See “-B. Business Overview-Properties and Facilities.”
Our net loss was $1,295,163, and net income was $2,208,152 and $2,289,158, for the fiscal years ended March 31, 2024, 2023 and 2022, respectively.
Our net loss was $1,410,465 and $ 1,295,163, and net income was $2,208,152, for the fiscal years ended March 31, 2025, 2024, and 2023, respectively.
During the fiscal years 2022, 2023 and 2024, we did not file any material insurance claims in relation to our businesses. 39 Employees We and our subsidiaries had a total of 273, 304, and 268 employees as of March 31, 2024, 2023 and 2022, respectively. As of the date of this report, we have 274 employees.
During the fiscal years ended March 31, 2023, 2024, and 2025 we did not file any material insurance claims in relation to our businesses. 42 Employees We and our subsidiaries had a total of 264, 273, and 304 employees as of March 31, 2025, 2024, and 2023, respectively. As of the date of this annual report, we have 263 employees.
CCSC Technology Group has three wholly-owned subsidiaries in Hong Kong, mainland China, and the Netherlands as follows: ● CCSC Interconnect DG, or Dongguan CCSC Interconnect Electronic Technology Limited, a company incorporated on June 28, 1993 in Dongguan, China; ● CCSC Interconnect HK, or CCSC Interconnect Technology Limited, a company incorporated on July 3, 2007 in Hong Kong, China; and ● CCSC Interconnect NL, or CCSC Interconnect Technology Europe B.V. a company incorporated on March 14, 2016 in the Netherlands. 30 Prior to the reorganization described below, CCSC Technology Group was controlled by several individual shareholders.
CCSC Technology Group has three wholly-owned subsidiaries in Hong Kong, mainland China, and the Netherlands as follows: ● CCSC Interconnect DG, or Dongguan CCSC Interconnect Electronic Technology Limited, a company incorporated on June 28, 1993 in Dongguan, China; ● CCSC Interconnect HK, or CCSC Interconnect Technology Limited, a company incorporated on July 3, 2007 in Hong Kong, China; and ● CCSC Interconnect NL, or CCSC Interconnect Technology Europe B.V. a company incorporated on March 14, 2016 in the Netherlands.
If the registrant fails to apply for renewal in a timely manner, a grace period of six (6) additional months may be granted.
If the registrant fails to apply for renewal in a timely manner, a grace period of six (6) additional months may be granted. However, if the registrant fails to apply for renewal before the grace period expires, the registered trademark shall be deregistered.
Failure to comply with the registration requirements as set forth in both the SAFE Circular 37 and the SAFE Circular 13, misrepresent on or failure to disclose controllers of foreign-invested enterprises that are established by round-trip investment may result in bans on the foreign exchange activities of the relevant onshore company, including the payment of dividends and other distributions to its offshore parent company or affiliates, and may also subject relevant mainland China residents to penalties under the Foreign Exchange Administration Regulations of the PRC.
Failure to comply with the registration requirements as set forth in both the SAFE Circular 37 and the SAFE Circular 13, misrepresent on or failure to disclose controllers of foreign-invested enterprises that are established by round-trip investment may result in bans on the foreign exchange activities of the relevant onshore company, including the payment of dividends and other distributions to its offshore parent company or affiliates, and may also subject relevant mainland China residents to penalties under the Foreign Exchange Administration Regulations of the PRC. 53 We may not be informed of the identities of all the mainland China residents holding direct or indirect interest in our company, and we have no control over any of our future beneficial owners.
PRC Regulations Relating to Work Safety The Work Safety Law of the PRC, issued on June 29, 2002, last amended on June 10, 2021 and became effective on September 1, 2021, provides that production and business operation entities shall abide by this law and other laws and regulations concerning work safety, strengthen work safety management; establish and improve work safety responsibility systems and rules; improve work safety conditions; promote work safety standardization and improve work safety levels, so as to ensure work safety.
If the goods or services provided by the business operators cause personal injuries to consumers or third parties, the business operators shall compensate the injured parties for their losses. 47 PRC Regulations Relating to Work Safety The Work Safety Law of the PRC, issued on June 29, 2002, last amended on June 10, 2021 and became effective on September 1, 2021, provides that production and business operation entities shall abide by this law and other laws and regulations concerning work safety, strengthen work safety management; establish and improve work safety responsibility systems and rules; improve work safety conditions; promote work safety standardization and improve work safety levels, so as to ensure work safety.
If an enterprise produces and discharges major pollutants having major impacts on the environment, an intensive pollutant discharge permit is required; if an enterprise produces and discharges minor pollutants having minor impacts on the environment, a simplified pollutant discharge permit is required; if an enterprise produces and discharges a tiny amount pollutants having tiny impacts on the environment, no pollutant discharge permit is required, but it shall register at the relevant online platform with detailed information about its pollutant discharge, as well as the preventive measures taken on such pollutant discharge.
If an enterprise produces and discharges major pollutants having major impacts on the environment, an intensive pollutant discharge permit is required; if an enterprise produces and discharges minor pollutants having minor impacts on the environment, a simplified pollutant discharge permit is required; if an enterprise produces and discharges a tiny amount pollutants having tiny impacts on the environment, no pollutant discharge permit is required, but it shall register at the relevant online platform with detailed information about its pollutant discharge, as well as the preventive measures taken on such pollutant discharge. 46 CCSC Interconnect DG has completed the registration for its pollutant discharge online, which will remain valid until April 2, 2030.
If an employer fails to conduct housing provident fund registration or open housing provident fund accounts for its employees, the relevant housing provident fund administrative center will order it to complete such registration and open accounts within a prescribed time limit, a fine up to RMB50,000 may be imposed if such employer fail to do so at the given time limit; if the employer fails to pay housing provident fund in part or in full, the relevant housing provident fund administrative center shall order it to pay the outstanding amount within a particular time frame, and if such employer fails to comply with such order, the relevant housing provident fund administrative center may apply for compulsory execution from certain people’s court.
If an employer fails to conduct housing provident fund registration or open housing provident fund accounts for its employees, the relevant housing provident fund administrative center will order it to complete such registration and open accounts within a prescribed time limit, a fine up to RMB50,000 may be imposed if such employer fail to do so at the given time limit; if the employer fails to pay housing provident fund in part or in full, the relevant housing provident fund administrative center shall order it to pay the outstanding amount within a particular time frame, and if such employer fails to comply with such order, the relevant housing provident fund administrative center may apply for compulsory execution from certain people’s court. 49 As of the date of this annual report, CCSC Interconnect DG has not made adequate housing provident fund contributions to their employees, which may subject it to fines, see “ Item 3.
The cost of the components constituted approximately 67.8%, 74.8% and 72.2% of the total cost of production for the fiscal years ended March 31, 2024, 2023 and 2022, respectively. For the fiscal year ended March 31, 2024, there was one supplier who accounted for 12.1% of the total purchases.
The cost of the components constituted approximately 67.8%, 67.8%, and 74.8% of the total cost of production for the fiscal years ended March 31, 2025, 2024, and 2023, respectively. For the fiscal year ended March 31, 2025, there was no supplier who accounted for more than 10 % of the total purchases.
According to the Measures for Security Review of Foreign Investment, foreign investment activities falling within the scope such as important cultural products and The PRC Company Law Pursuant to the PRC Company Law (2023 Revision), which was promulgated by the Standing Committee of the National People’s Congress, or the SCNPC, on December 29, 2023 and became effective on July 1, 2024, the establishment, operation and management of corporate entities in mainland China are governed by the PRC Company Law.
The PRC Company Law Pursuant to the PRC Company Law (2023 Revision), which was promulgated by the Standing Committee of the National People’s Congress, or the SCNPC, on December 29, 2023 and became effective on July 1, 2024, the establishment, operation and management of corporate entities in mainland China are governed by the PRC Company Law.
Where the non-resident enterprise has no institutions or premises established in mainland China or has income bearing no de facto relationship with the institution or premises established in mainland China, EIT shall be payable by the non-resident enterprise only for income sourced within mainland China at the rate of 20%. 46 Pursuant to the Administrative Measures on the Accreditation of High and New Technology Enterprise which was promulgated on January 29, 2016 and became effective as of January 1, 2016, enterprises that have been accredited as a HNTE, and can enjoy a preferential income tax rate of 15% in accordance with the PRC EIT Law and its implementation rules for a period of consecutive three (3) years, commencing from the year that such high-tech certificate has been obtained.
Pursuant to the Administrative Measures on the Accreditation of High and New Technology Enterprise which was promulgated on January 29, 2016 and became effective as of January 1, 2016, enterprises that have been accredited as a HNTE, and can enjoy a preferential income tax rate of 15% in accordance with the PRC EIT Law and its implementation rules for a period of consecutive three (3) years, commencing from the year that such high-tech certificate has been obtained.
The following table sets forth the number of our employees by function as of the date of this annual report: Department Number of Employees Management 5 Manufacturing 136 Engineering 40 Quality 25 Sales and marketing 16 Warehouse, production and material control 16 Purchasing 7 Finance 11 Administration, MIS and Human resources 17 Project management 1 Total 274 We enter into employment contracts with our full-time employees.
The following table sets forth the number of our employees by function as of the date of this annual report: Department Number of Employees Management 4 Manufacturing 138 Engineering 20 Quality 29 Sales and marketing 16 Warehouse, production and material control 21 Purchasing 8 Finance 12 Administration, MIS and Human resources 15 Total 263 We enter into employment contracts with our full-time employees.
Moreover, employers shall pay wages that are no lower than the local minimum wage standards to their employees, and are prohibited from forcing their employees to work above certain time limit and shall pay employees for overtime work in accordance to national regulations. 45 The Social Insurance Law Under the Social Insurance Law of the PRC (2018 Revision), which was promulgated and became effective on December 29, 2018, employers are required to pay basic pension insurance, unemployment insurance, basic medical insurance, employment injury insurance and maternity insurance for their employees at specified percentages of the salaries of the employees, up to a maximum amount specified by the local government regulations from time to time, and employees are required to pay basic pension insurance, unemployment insurance and basic medical insurance at specified percentages of their salaries.
The Social Insurance Law Under the Social Insurance Law of the PRC (2018 Revision), which was promulgated and became effective on December 29, 2018, employers are required to pay basic pension insurance, unemployment insurance, basic medical insurance, employment injury insurance and maternity insurance for their employees at specified percentages of the salaries of the employees, up to a maximum amount specified by the local government regulations from time to time, and employees are required to pay basic pension insurance, unemployment insurance and basic medical insurance at specified percentages of their salaries.
Fiscal year ended March 31, 2024 Fiscal year ended March 31, 2023 Fiscal year ended March 31, 2022 Total Revenue (US$) % of Total Revenue Total Revenue (US$) % of Total Revenue Total Revenue (US$) % of Total Revenue Northern Europe 6,402,388 43.4 % 10,704,148 44.6 % 11,463,213 42.2 % Hong Kong 1,895,230 12.9 % 3,073,838 12.8 % 3,923,918 14.4 % Mainland China 1,372,966 9.3 % 1,779,668 7.4 % 2,732,885 10.1 % North America 1,377,541 9.3 % 1,570,978 6.5 % 1,973,388 7.3 % Southern Europe 900,786 6.1 % 913,221 3.8 % 1,467,126 5.4 % Eastern Europe 825,249 5.6 % 2,984,706 12.4 % 2,667,109 9.8 % ASEAN 1,570,519 10.6 % 2,557,550 10.6 % 2,006,738 7.4 % Western Europe 395,364 2.8 % 442,363 1.8 % 847,878 3.1 % Other Asia countries 4,368 0.0 % 27,235 0.1 % 67,539 0.2 % Southern America 4,140 0.0 % 5,849 0.0 % 20,141 0.1 % Total 14,748,551 100 % 24,059,556 100.0 % 27,169,935 100.0 % For more than 20 years, we have strived to offer quality products at competitive prices.
Fiscal year ended March 31, 2025 Fiscal year ended March 31, 2024 Fiscal year ended March 31, 2023 Total Revenue (US$) % of Total Revenue Total Revenue (US$) % of Total Revenue Total Revenue (US$) % of Total Revenue Northern Europe 8,547,915 48.4 % 6,402,388 43.4 % 10,704,148 44.6 % Hong Kong 1,670,446 9.5 % 1,895,230 12.9 % 3,073,838 12.8 % Mainland China 1,636,832 9.3 % 1,372,966 9.3 % 1,779,668 7.4 % North America 1,299,799 7.4 % 1,377,541 9.3 % 1,570,978 6.5 % Southern Europe 1,203,407 6.8 % 900,786 6.1 % 913,221 3.8 % Eastern Europe 893,500 5.1 % 825,249 5.6 % 2,984,706 12.4 % ASEAN 2,025,688 11.5 % 1,570,519 10.6 % 2,557,550 10.6 % Western Europe 347,082 2.0 % 395,364 2.8 % 442,363 1.8 % Other Asia countries 3,282 0.0 % 4,368 0.0 % 27,235 0.1 % Southern America 3,487 0.0 % 4,140 0.0 % 5,849 0.0 % Australia 51 0.0 % - - % - - % Total 17,631,489 100.0 % 14,748,551 100.0 % 24,059,556 100.0 % For more than 20 years, we have strived to offer quality products at competitive prices.
For fiscal year 2024, aggregate sales to two customers accounted for approximately 17.4% and 12.7% each of our total sales. For fiscal year 2023, aggregate sales to three customers accounted for approximately 12.0%, 10.6% and 10.5% each of our total sales, respectively.
For fiscal year ended March 31, 2025, aggregate sales to three customers accounted for approximately 14.5 %, 11.9%, and 10.4 % of our total sales. For fiscal year ended March 31, 2024, aggregate sales to two customers accounted for approximately 17.4% and 12.7% each of our total sales.
In general, the following factors are unfavorable for the determination of “beneficial owner” status of an applicant: (i) the applicant is obligated to pay 50% or more of the income, within 12 months from its receipt, to a resident of a third country (region), where the term “obligated” includes agreed obligations and de facto payment for which there is no agreed obligation; (ii) the business activities undertaken by the applicant do not constitute substantive business activities; (iii) the treaty counterparty country (region) does not levy, or exempts tax on the relevant income, or levies tax but with a very low actual tax rate; (iv) in addition to the loan contract based on which interest is derived and paid, there exists other loans or deposit contracts between the creditor and the third party, of which factors such as the amount, interest rate and date of execution are similar; and (v) in addition to the transfer contract for rights to use such as copyright, patent, technology, from which the royalties are derived and paid, there exists other transfer contracts for rights to use or ownership in relation to copyright, patent, technology between the applicant and a third party. 47 Pursuant to the Notice on the Relevant Issues Concerning the Implementation of Dividend Clauses in Tax Treaties promulgated by the SAT and became effective on February 20, 2009, all of the following conditions shall be satisfied before the concession tax rate in a tax treaty can be enjoyed: (1) the tax resident obtaining dividends shall be restricted to the company as provided in the tax treaty; (2) among all the ownership equity interests and voting shares of the mainland China resident company, the proportion directly owned by the tax resident complies with the prescribed proportions under the tax treaty; and (3) the proportion of the equity interests of mainland China resident company directly owned by such tax resident complies with, at all times within the twelve months before obtaining the dividends, the proportions specified in the tax treaty.
In general, the following factors are unfavorable for the determination of “beneficial owner” status of an applicant: (i) the applicant is obligated to pay 50% or more of the income, within 12 months from its receipt, to a resident of a third country (region), where the term “obligated” includes agreed obligations and de facto payment for which there is no agreed obligation; (ii) the business activities undertaken by the applicant do not constitute substantive business activities; (iii) the treaty counterparty country (region) does not levy, or exempts tax on the relevant income, or levies tax but with a very low actual tax rate; (iv) in addition to the loan contract based on which interest is derived and paid, there exists other loans or deposit contracts between the creditor and the third party, of which factors such as the amount, interest rate and date of execution are similar; and (v) in addition to the transfer contract for rights to use such as copyright, patent, technology, from which the royalties are derived and paid, there exists other transfer contracts for rights to use or ownership in relation to copyright, patent, technology between the applicant and a third party.
The prescribed minimum hourly wage rate (currently set at HK$40 per hour) for every employee is govern by the Minimum Wage Ordinance (Chapter 608 of the Laws of Hong Kong) (the “MWO”).
An employer failing to do so may be liable to a fine and imprisonment. The prescribed minimum hourly wage rate (currently set at HK$40 per hour) for every employee is govern by the Minimum Wage Ordinance (Chapter 608 of the Laws of Hong Kong) (the “MWO”).
To that end, we intend to (1) increase the level of automation of our production process, primarily through the upgrade and replacement of existing semi-automatic and manual machinery to fully-automated machinery, to reduce production costs and increase output, and (2) upgrade and optimize our management information system and other applications that integrate our system with those of our customers and suppliers, to improve operational efficiency and reduce administrative costs.
To that end, we intend to (1) increase the level of automation of our production process, primarily through the upgrade and replacement of existing semi-automatic and manual machinery to fully-automated machinery, to reduce production costs and increase output, and (2) upgrade and optimize our management information system and other applications that integrate our system with those of our customers and suppliers, to improve operational efficiency and reduce administrative costs. 35 Expand new customer base and increase product offering to existing customers We are preferred vendors of many global brand-name manufactures and have established long-term working relationships with our key customers.
Further, we plan to recruit more experienced sales and marketing executives and staff to accelerate our sales and marketing efforts and grow our business. 33 Continue to invest in research and development and cultivate engineering talents Our product research and development capability has always been a cornerstone of our past success, and we plan to continually invest in our engineering team to strengthen our research and development capability.
Continue to invest in research and development and cultivate engineering talents Our product research and development capability has always been a cornerstone of our past success, and we plan to continually invest in our engineering team to strengthen our research and development capability.
We also test each completed product for resistance and insulation use testing machines. Our management believes that maintaining objectively verifiable quality standards fosters consumer confidence and loyalty.
The completed products can be plugged into the test board and tested individually or in multiple numbers. We also test each completed product for resistance and insulation use testing machines. Our management believes that maintaining objectively verifiable quality standards fosters consumer confidence and loyalty.
Cables and wire harnesses have similar structures, except that wire harnesses have no outer sheaths and are mainly composed of conductors and insulators. Cables, on the other hand, are mainly composed of conductors, insulators, and additional outer sheathes, which provide extra protections against external elements. We manufacture varieties of cables and wire harnesses for applications in products in various industries.
Cables, on the other hand, are mainly composed of conductors, insulators, and additional outer sheathes, which provide extra protections against external elements. We manufacture varieties of cables and wire harnesses for applications in products in various industries. A number of our cables and wire harnesses are custom designed based on technical requirements for specific applications in different industries.
At the same time, they shall collect and retain relevant materials for future reference in accordance with the provisions of these Measures, and shall accept the follow-up administration by the relevant tax authorities. Relevant materials proving the status of “beneficial owner” shall be retained in the case of entitlement to treaty benefits relating to dividend, interest and royalty.
At the same time, they shall collect and retain relevant materials for future reference in accordance with the provisions of these Measures, and shall accept the follow-up administration by the relevant tax authorities.
CCSC Interconnect DG currently engages in the design, manufacture, and sale of interconnect product businesses, which activities do not fall within any restricted or prohibited category on the Negative List. 41 The Foreign Investment Law On March 15, 2019, the National People’s Congress approved the Foreign Investment Law, which took effect on January 1, 2020 and replaced the three governing laws on foreign investments in mainland China, namely, the PRC Sino-foreign Equity Joint Ventures Law, the PRC Sino-foreign Cooperative Enterprises Law and the PRC Wholly Foreign-owned Enterprises Law, together with their implementation rules and ancillary regulations.
The Foreign Investment Law On March 15, 2019, the National People’s Congress approved the Foreign Investment Law, which took effect on January 1, 2020 and replaced the three governing laws on foreign investments in mainland China, namely, the PRC Sino-foreign Equity Joint Ventures Law, the PRC Sino-foreign Cooperative Enterprises Law and the PRC Wholly Foreign-owned Enterprises Law, together with their implementation rules and ancillary regulations.
Our PRC counsel, JT&N, has advised us that, based on its understanding of current PRC laws, rules and regulations, and the M&A Rules, the CSRC approval is not required in the context of our initial public offering in January 2024 given that: (i) CCSC Interconnect DG was established by means of direct investment rather than by a merger with or an acquisition of any mainland China domestic companies as defined under the M&A Rules, and (ii) no explicit provision in the M&A Rules classifies the respective share structure like ours falling within the M&A Rules.
The M&A Rules, among other things, requires that offshore SPVs that are controlled by mainland China companies or individuals and that have been formed for overseas listing purposes through acquisitions of mainland China domestic interest held by such companies or individuals, shall obtain the approval of the CSRC prior to publicly listing their securities on an overseas stock exchange. 54 Our PRC counsel, JT&N, has advised us that, based on its understanding of current PRC laws, rules and regulations, and the M&A Rules, the CSRC approval was not required in the context of our IPO, or any follow-on offerings, given that: (i) CCSC Interconnect DG was established by means of direct investment rather than by a merger with or an acquisition of any mainland China domestic companies as defined under the M&A Rules, and (ii) no explicit provision in the M&A Rules classifies the respective share structure like ours falling within the M&A Rules.
Pursuant to the Foreign Investment Reporting Measures, for foreign investment carried out directly or indirectly within mainland China, foreign investors or FIEs shall submit investment information for establishments, modifications and dissolution and annual reports of the FIEs through the online reporting system. 42 On December 19, 2020, the NDRC and the MOFCOM promulgated the Measures for Security Review of Foreign Investment, which became effective on January 18, 2021, pursuant to which, security review shall be conducted if foreign investments affecting or likely to affect national security.
On December 19, 2020, the NDRC and the MOFCOM promulgated the Measures for Security Review of Foreign Investment, which became effective on January 18, 2021, pursuant to which, security review shall be conducted if foreign investments affecting or likely to affect national security.
CCSC Interconnect DG has completed the registration for its pollutant discharge online, which will remain valid until April 2, 2030. PRC Regulations Relating to Product Quality Pursuant to the Product Quality Law of the PRC, promulgated on February 22, 1993, last amended on and effective December 29, 2018, producers shall be responsible for the quality of their products.
PRC Regulations Relating to Product Quality Pursuant to the Product Quality Law of the PRC, promulgated on February 22, 1993, last amended on and effective December 29, 2018, producers shall be responsible for the quality of their products.
For fiscal year 2022, aggregate sales to one customer accounted for approximately 15.5% of our total sales. 36 Manufacturing We design, manufacture and assemble our products at our Dongguan factory located in Guangdong province, China.
For fiscal year ended March 31, 2023, aggregate sales to three customers accounted for approximately 12.0%, 10.6% and 10.5% each of our total sales, respectively. Manufacturing We design, manufacture and assemble our products at our Dongguan factory located in Guangdong province, China.
Where an ordinary foreign-invested enterprise makes domestic equity investment with the amount of foreign exchanges settled, the invested enterprise must first go through domestic re-investment registration and open a corresponding account for foreign exchange settlement pending payment with the foreign exchange administration or the bank at the place where it is registered. 48 In June 2016, SAFE promulgated Circular on Reforming and Regulating Policies on the Control over Foreign Exchange Settlement of Capital Accounts, or the SAFE Circular 16, pursuant to which, in addition to foreign currency capital, enterprises registered in mainland China may also convert their foreign debts, as well as repatriated fund raised through overseas listing, from foreign currency to Renminbi on a discretional basis.
In June 2016, SAFE promulgated Circular on Reforming and Regulating Policies on the Control over Foreign Exchange Settlement of Capital Accounts, or the SAFE Circular 16, pursuant to which, in addition to foreign currency capital, enterprises registered in mainland China may also convert their foreign debts, as well as repatriated fund raised through overseas listing, from foreign currency to Renminbi on a discretional basis.
Corporate Information Our principal executive offices are located at 1301-03, 13/f Shatin Galleria, 18-24 Shan Mei St, Fotan, Shatin, Hong Kong. Our telephone number at this address is 00852-26870272.
As of the date of this annual report, an aggregate of 6,581,250 Class A Ordinary Shares and 5,000,000 Class B Ordinary Shares are issued and outstanding. Corporate Information Our principal executive offices are located at 1301-03, 13/f Shatin Galleria, 18-24 Shan Mei St, Fotan, Shatin, Hong Kong. Our telephone number at this address is 00852-26870272.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

122 edited+35 added−19 removed67 unchanged
However, in response to the expected increase of supply chain costs that caused the rising of our unit selling price, our customers had purchased products in advance from us in the fiscal year 2022 and the first half of the fiscal year 2023, resulting in a contraction in demand in the second half of the fiscal year 2023, and our revenue decreased by 11.4%, from US$27.17 million for the fiscal year ended March 31, 2022 to US$24.06 million for the fiscal year ended March 31, 2023.
However, in response to the expected increase of supply chain costs that caused the rising of our unit selling price, our customers had purchased products in advance from us in the fiscal year ended March 31, 2022 and the first half of the fiscal year ended March 31, 2023, resulting in a contraction in demand in the second half of the fiscal year ended March 31, 2023, and our revenue decreased by 11.4%, from US$27.17 million for the fiscal year ended March 31, 2022 to US$24.06 million for the fiscal year ended March 31, 2023.
For the years ended March 31, Change 2024 % 2023 % Amount % (Amounts expressed in U.S. dollars) Cable and wire harness $ 13,626,836 92.4 % $ 22,212,627 92.3 % $ (8,585,791 ) (38.7 )% Connectors 1,121,715 7.6 % 1,846,929 7.7 % (725,214 ) (39.3 )% Total $ 14,748,551 100.0 % $ 24,059,556 100.0 % $ (9,311,005 ) (38.7 )% For the fiscal year ended March 31, 2024, our revenue generated from cables and wire harnesses decreased by 38.7%, from US$22.21 million for the fiscal year ended March 31, 2023 to US$13.63 million for the fiscal year ended March 31, 2024.
For the fiscal years ended March 31, Change 2024 % 2023 % Amount % (Amounts expressed in U.S. dollars) Cable and wire harness $ 13,626,836 92.4 % $ 22,212,627 92.3 % $ (8,585,791 ) (38.7 )% Connectors 1,121,715 7.6 % 1,846,929 7.7 % (725,214 ) (39.3 )% Total $ 14,748,551 100.0 % $ 24,059,556 100.0 % $ (9,311,005 ) (38.7 )% For the fiscal year ended March 31, 2024, our revenue generated from cables and wire harnesses decreased by 38.7%, from US$22.21 million for the fiscal year ended March 31, 2023 to US$13.63 million for the fiscal year ended March 31, 2024.
Our cost of revenue decreased by US$5.37 million, or 33.1%, from US$16.19 million for the fiscal year ended March 31, 2023 to US$10.83 million for the year ended March 31, 2024.
Our cost of revenue decreased by US$5.37 million, or 33.1%, from US$16.19 million for the fiscal year ended March 31, 2023 to US$10.83 million for the fiscal year ended March 31, 2024.
The decrease was partially offset by (i) an increase of US$0.04 million in travelling expenses for site visit to our existing and potential customers in Europe and (ii) an increase of US$0.04 million in consulting service fees for market development and expansion to ASEAN market.
The decrease was partially offset by (i) an increase of US$0.04 million in travelling expenses for site visit to our existing and potential customers in Europe and (ii) an increase of US$0.04 million in consulting service fees for market development and expansion to the ASEAN market.
If CCSC Technology Group satisfies all the requirements under the tax arrangement and receives approval from the relevant tax authority, then the dividends paid to the Hong Kong subsidiary would be subject to withholding tax at the standard rate of 5%.
If CCSC Technology Group satisfies all the requirements under the tax arrangement and receives approval from the relevant tax authority, then the dividends paid to the Hong Kong subsidiary would be subject to withholding tax at the standard rate of 5%.
Effective from November 1, 2015, the above-mentioned approval requirement was abolished, but a Hong Kong entity is still required to file an application package with the relevant tax authority, and settle the overdue taxes if the preferential 5% tax rate is denied based on the subsequent review of the application package by the relevant tax authority.
Effective from November 1, 2015, the above-mentioned approval requirement was abolished, but a Hong Kong entity is still required to file an application package with the relevant tax authority, and settle the overdue taxes if the preferential 5% tax rate is denied based on the subsequent review of the application package by the relevant tax authority.
If we or any of our subsidiaries outside of China were deemed to be a “resident enterprise” under the PRC Enterprise Income Tax Law, the affected entity would be subject to enterprise income tax on its worldwide income at a rate of 25%.
If we or any of our subsidiaries outside of China were deemed to be a “resident enterprise” under the PRC Enterprise Income Tax Law, the affected entity would be subject to enterprise income tax on its worldwide income at a rate of 25%.
Starting from January 1, 2021, besides deducting the actual amount of research and development expenses incurred, an enterprise is allowed an additional 100% deduction of the amount in calculating its taxable income for the relevant year, the rate of which was 75% before 2021.
Starting from January 1, 2021, besides deducting the actual amount of research and development expenses incurred, an enterprise is allowed an additional 100% deduction of the amount in calculating its taxable income for the relevant year, the rate of which was 75% before 2021.
Financing activities For the fiscal year ended March 31, 2024, our net cash provided by financing activities was US$4.63 million, which consisted of proceeds from issuance of Ordinary Shares, net of issuance cost of US$4.67 million and partially offset by the repayments of long-term bank loans of US$0.04 million.
For the fiscal year ended March 31, 2024, our net cash provided by financing activities was US$4.63 million, which consisted of proceeds from issuance of ordinary shares, net of issuance cost of US$4.67 million and partially offset by the repayments of long-term bank loans of US$0.04 million.
For the years ended March 31, change 2024 2023 Amount % (Amounts expressed in U.S. dollars) Net revenue $ 14,748,551 $ 24,059,556 $ (9,311,005 ) (38.7 )% Cost of revenue (10,825,943 ) (16,190,985 ) 5,365,042 (33.1 )% Gross profit 3,922,608 7,868,571 (3,945,963 ) (50.1 )% Operating expenses: Selling expenses (1,039,882 ) (1,097,150 ) 57,268 (5.2 )% General and administrative expenses (4,134,394 ) (3,898,894 ) (235,500 ) 6.0 % Research and development expenses (594,521 ) (1,084,119 ) 489,598 (45.2 )% Total operating expenses (5,768,797 ) (6,080,163 ) 311,366 (5.1 )% (Loss)/income from operations (1,846,189 ) 1,788,408 (3,634,597 ) (203.2 )% Other (expenses)/income: Other non-operating (expenses)/income, net (35,509 ) 49,873 (85,382 ) (171.2 )% Government subsidy 7,255 62,627 (55,372 ) (88.4 )% Foreign currency exchange income 425,308 562,527 (137,219 ) (24.4 )% Financial and interest income, net 67,636 22,455 45,181 201.2 % Total other income 464,690 697,482 (232,792 ) (33.4 )% (Loss)/income before income tax expense (1,381,499 ) 2,485,890 (3,867,389 ) (155.6 )% Income tax benefit/(expense) 86,336 (277,738 ) 364,074 (131.1 )% Net (loss)/income $ (1,295,163 ) $ 2,208,152 $ (3,503,315 ) (158.7 )% Revenue We generated revenue primarily from the sales of both OEM and ODM interconnect products, including connectors, cables and wire harnesses, to manufacturing companies and EMS companies, who procure and assemble products on behalf of manufacturing companies.
For the fiscal years ended March 31, change 2024 2023 Amount % (Amounts expressed in U.S. dollars) Net revenue $ 14,748,551 $ 24,059,556 $ (9,311,005 ) (38.7 )% Cost of revenue (10,825,943 ) (16,190,985 ) 5,365,042 (33.1 )% Gross profit 3,922,608 7,868,571 (3,945,963 ) (50.1 )% Operating expenses: Selling expenses (1,039,882 ) (1,097,150 ) 57,268 (5.2 )% General and administrative expenses (4,134,394 ) (3,898,894 ) (235,500 ) 6.0 % Research and development expenses (594,521 ) (1,084,119 ) 489,598 (45.2 )% Total operating expenses (5,768,797 ) (6,080,163 ) 311,366 (5.1 )% (Loss)/income from operations (1,846,189 ) 1,788,408 (3,634,597 ) (203.2 )% Other (expenses)/income: Other non-operating (expenses)/income, net (35,509 ) 49,873 (85,382 ) (171.2 )% Government subsidy 7,255 62,627 (55,372 ) (88.4 )% Foreign currency exchange income 425,308 562,527 (137,219 ) (24.4 )% Financial and interest income, net 67,636 22,455 45,181 201.2 % Total other income 464,690 697,482 (232,792 ) (33.4 )% (Loss)/income before income tax expense (1,381,499 ) 2,485,890 (3,867,389 ) (155.6 )% Income tax benefit/(expense) 86,336 (277,738 ) 364,074 (131.1 )% Net (loss)/income $ (1,295,163 ) $ 2,208,152 $ (3,503,315 ) (158.7 )% 67 Revenue We generated revenue primarily from the sales of both OEM and ODM interconnect products, including connectors, cables, and wire harnesses, to manufacturing companies and EMS companies, who procure and assemble products on behalf of manufacturing companies.
The following table sets forth the disaggregation of revenue by regions: For the years ended March 31, Change 2024 % 2023 % Amount % (Amounts expressed in U.S. dollars) Europe $ 8,523,788 57.8 % $ 15,044,438 62.5 % $ (6,520,650 ) (43.3 )% Asia 4,843,082 32.8 % 7,438,292 30.9 % (2,595,210 ) (34.9 )% Americas 1,381,681 9.4 % 1,576,826 6.6 % (195,145 ) (12.4 )% Total $ 14,748,551 100 % $ 24,059,556 100 % $ (9,311,005 ) (38.7 )% 58 Our revenue generated from Europe decreased by 43.3%, from US$15.04 million for the fiscal year ended March 31, 2023 to US$8.52 million for the fiscal year ended March 31, 2024.
The following table sets forth the disaggregation of revenue by regions: For the fiscal years ended March 31, Change 2024 % 2023 % Amount % (Amounts expressed in U.S. dollars) Europe $ 8,523,788 57.8 % $ 15,044,438 62.5 % $ (6,520,650 ) (43.3 )% Asia 4,843,082 32.8 % 7,438,292 30.9 % (2,595,210 ) (34.9 )% Americas 1,381,681 9.4 % 1,576,826 6.6 % (195,145 ) (12.4 )% Total $ 14,748,551 100 % $ 24,059,556 100 % $ (9,311,005 ) (38.7 )% Our revenue generated from Europe decreased by 43.3%, from US$15.04 million for the fiscal year ended March 31, 2023 to US$8.52 million for the fiscal year ended March 31, 2024.
As our business further grows in scale, we expect to have higher bargaining power and, hence, more favorable terms, including pricing and payment terms, for the sourcing of components. Impact of foreign exchange fluctuation Since we operate internationally, we sometimes purchase products and services with foreign currencies other than the currencies in which we normally conduct our operations.
As our business further grows in scale, we expect to have higher bargaining power and, hence, more favorable terms, including pricing and payment terms, for the sourcing of components. 59 Impact of foreign exchange fluctuation Since we operate internationally, we sometimes purchase products and services with foreign currencies other than the currencies in which we normally conduct our operations.
Operating Expenses For the years ended March 31, Change 2024 % 2023 % Amount % (Amounts expressed in U.S. dollars) Selling expenses $ (1,039,882 ) (7.1 )% $ (1,097,150 ) (4.6 )% $ 57,268 (5.2 )% General and administrative expenses (4,134,394 ) (28.0 )% (3,898,894 ) (16.2 )% (235,500 ) 6.0 % Research and development expenses (594,521 ) (4.0 )% (1,084,119 ) (4.5 )% 489,598 (45.2 )% Total $ (5,768,797 ) (39.1 )% $ (6,080,163 ) (25.3 )% $ 311,366 (5.1 )% Selling expenses Selling expenses primarily consist of: (i) freight fees and transportation fees; (ii) staff costs, travelling expenses, rental and depreciation related to selling and marketing functions; and (iii) marketing and entertainment expenses for promotion; and (iv) free sample expenses incurred for obtaining new customers and sales orders.
Operating Expenses For the fiscal years ended March 31, Change 2024 % 2023 % Amount % (Amounts expressed in U.S. dollars) Selling expenses $ (1,039,882 ) (7.1 )% $ (1,097,150 ) (4.6 )% $ 57,268 (5.2 )% General and administrative expenses (4,134,394 ) (28.0 )% (3,898,894 ) (16.2 )% (235,500 ) 6.0 % Research and development expenses (594,521 ) (4.0 )% (1,084,119 ) (4.5 )% 489,598 (45.2 )% Total $ (5,768,797 ) (39.1 )% $ (6,080,163 ) (25.3 )% $ 311,366 (5.1 )% 70 Selling expenses Selling expenses primarily consist of: (i) freight fees and transportation fees; (ii) staff costs, travelling expenses, rental and depreciation related to selling and marketing functions; and (iii) marketing and entertainment expenses for promotion; and (iv) free sample expenses incurred for obtaining new customers and sales orders.
We specialize in customized interconnect products that are used for a range of applications in a diversified set of industries, including industrial, automotive, robotics, medical equipment, computer, network and telecommunication, and consumer products. We have a diversified global customer base located in more than 25 countries throughout Asia, Europe and the Americas.
We specialize in customized interconnect products that are used for a range of applications in a diversified set of industries, including industrial, automotive, robotics, medical equipment, computer, network and telecommunication, and consumer products. We have a diversified global customer base located in more than 25 countries throughout Asia, Europe, the Americas, and Australia.
In addition, while we do not have any direct operations or significant sales in the Middle East, geopolitical tensions and ongoing conflicts in the region, particularly between Israel and Palestine, may lead to global economic instability and fluctuating energy prices that could materially affect our business.
While we do not have any direct operations or significant sales in the Middle East, geopolitical tensions and ongoing conflicts in the region, particularly between Israel and Palestine, may lead to global economic instability and fluctuating energy prices that could materially affect our business.
Our financial results may be adversely affected by changes in the political, regulatory and social conditions in HK and mainland China. The following critical accounting policies rely upon assumptions and estimates and were used in the preparation of our consolidated financial statements: Critical Accounting Estimates We prepare our consolidated financial statements in accordance with U.S.
Our financial results may be adversely affected by changes in the political, regulatory, and social conditions in HK and mainland China. 76 The following critical accounting policies rely upon assumptions and estimates and were used in the preparation of our consolidated financial statements: Critical Accounting Estimates We prepare our consolidated financial statements in accordance with U.S.
British Virgin Islands Our subsidiary, CCSC Group Limited, was incorporated under the laws of the British Virgin Islands (“BVI”) as a business company with limited liability under the BVI Business Companies Act and, accordingly, is not subject to income tax from business carried out in the BVI.
British Virgin Islands Our subsidiary, CCSC Group Limited, was incorporated under the laws of the BVI as a business company with limited liability under the BVI Business Companies Act and, accordingly, is not subject to income tax from business carried out in the BVI.
Net (loss)/income As a result of the foregoing, our net income decreased by 158.7%, or US$3.50 million from net income of US$2.21 million for the fiscal year ended March 31, 2023 to net loss of US$1.30 million for the fiscal year ended March 31, 2024.
Net (loss)/income As a result of the foregoing, our net income decreased by 158.7%, or US$3.50 million from net income of US$2.21 million for the fiscal year ended March 31, 2023 to net loss of US$1.30 million for the fiscal year ended March 31, 2024. B.
The following table sets forth the overall gross profit margin of the Company: For the years ended March 31, Change 2024 % 2023 % Amount % (Amounts expressed in U.S. dollars) Revenue $ 14,748,551 100 % $ 24,059,556 100 % $ (9,311,005 ) (38.7 )% Cost (10,825,943 ) (73.4 )% (16,190,985 ) (67.3 )% 5,365,042 (33.1 )% Gross Profit $ 3,922,608 26.6 % $ 7,868,571 32.7 % $ (3,945,963 ) (50.1 )% The gross profit margin slightly decreases compared to last year, primarily due to the increase in fixed cost per unit as a result of a decrease by 44.1% of total sales volume from 40.93 million units for the fiscal year 2023 to 22.86 million units for the fiscal year 2024, affected by the diminishing global export demands.
The following table sets forth the overall gross profit margin of the Company: For the fiscal years ended March 31, Change 2024 % 2023 % Amount % (Amounts expressed in U.S. dollars) Revenue $ 14,748,551 100 % $ 24,059,556 100 % $ (9,311,005 ) (38.7 )% Cost (10,825,943 ) (73.4 )% (16,190,985 ) (67.3 )% 5,365,042 (33.1 )% Gross Profit $ 3,922,608 26.6 % $ 7,868,571 32.7 % $ (3,945,963 ) (50.1 )% The gross profit margin slightly decreased in the fiscal year ended March 31, 2024 compared to the fiscal year ended March 31 2023, primarily due to the increase in fixed cost per unit as a result of a decrease by 44.1% of total sales volume from 40.93 million units for the fiscal year ended March 31, 2023 to 22.86 million units for the fiscal year ended March 31, 2024, affected by the diminishing global export demands.
Income tax benefit/(expense) Cayman Islands Our Company was incorporated in the Cayman Islands as an exempted company with limited liability under the Companies Act of the Cayman Islands and accordingly is not subject to income tax from business carried out in the Cayman Islands.
Income tax benefit Cayman Islands Our Company was incorporated in the Cayman Islands as an exempted company with limited liability under the Companies Act of the Cayman Islands and accordingly is not subject to income tax from business carried out in the Cayman Islands.
Since 2020, some of our customers who were negatively impacted by the COVID-19 pandemic reduced their demand for our products, such as cables and wire harnesses for outdoor lighting solutions.
Since 2020, some of our customers who were negatively impacted by the COVID-19 pandemic, which reduced their demand for our products, such as cables and wire harnesses for outdoor lighting solutions.
Revenue derived from cables and wire harnesses accounted for approximately 92.4%, 92.3% and 90.1% of our total revenue for those fiscal years, respectively. Revenue derived from connectors accounted for approximately 7.6%, 7.7% and 9.9% of our total revenue for those fiscal years, respectively.
Revenue derived from cables and wire harnesses accounted for approximately 92.9%, 92.4%, and 92.3% of our total revenue for those fiscal years, respectively. Revenue derived from connectors accounted for approximately 7.1%, 7.6%, and 7.7% of our total revenue for those fiscal years, respectively.
Hong Kong According to Tax (Amendment) (No. 3) Ordinance 2019 published by Hong Kong government, effective April 1, 2019, under the two-tiered profits tax rates regime, the profits tax rate for the first HK$2 million of assessable profits was reduced to 8.25% (half of the rate specified in Schedule 8 to the Inland Revenue Ordinance (IRO)) for corporations and 16.5% on any part of assessable profits over HK$2,000,000.
Hong Kong According to Tax (Amendment) (No. 3) Ordinance 2019 published by Hong Kong government, effective April 1, 2019, under the two-tiered profits tax rates regime, the profits tax rate for the first HK$2 million of assessable profits was reduced to 8.25% (half of the rate specified in Schedule 8 to the IRO) for corporations and 16.5% on any part of assessable profits over HK$2,000,000.
Comparison of Results of Operations for the Fiscal Years Ended March 31, 2023 and 2022 The following table sets forth a summary of our consolidated results of operations for the periods indicated. This information should be read together with our consolidated financial statements and related notes included elsewhere in this annual report.
Comparison of Results of Operations for the Fiscal Years Ended March 31, 2024 and 2023 The following table sets forth a summary of our consolidated results of operations for the periods indicated. This information should be read together with our consolidated financial statements and related notes included elsewhere in this annual report.
Risks and Uncertainties Our headquarters and sales office are located in HK, while we conduct the manufacturing of interconnect products through our PRC subsidiary located in mainland China. For the fiscal years ended March 31, 2024, 2023 and 2022, all of our revenue was generated by our HK and PRC subsidiaries collectively.
Risks and Uncertainties Our headquarters and sales office are located in HK, while we conduct the manufacturing of interconnect products through our PRC subsidiary located in mainland China. For the fiscal years ended March 31, 2025, 2024, and 2023, all of our revenue was generated by our HK and PRC subsidiaries collectively.
Mainland China Generally, our PRC subsidiary, CCSC Interconnect DG, is subject to enterprise income tax on its taxable income in China at a statutory rate of 25%; however , since CCSC Interconnect DG is certified as a National High Tech Enterprise, it is eligible for a preferential enterprise income tax rate of 15%.
Mainland China Generally, our PRC subsidiary, CCSC Interconnect DG, is subject to enterprise income tax on its taxable income in China at a statutory rate of 25%; however, since CCSC Interconnect DG is certified as a National High Tech Enterprise, or NHTE, it is eligible for a preferential enterprise income tax rate of 15%.
During fiscal year 2022 and 2023, we took a series of measures, including tailoring our communication methods to replace physical meetings by setting up virtual meetings (e.g., Zoom meetings) with our customers on a regular basis or when required by our customers, and enhancing our presence on social media (e.g., LinkedIn) to strengthen our relationships with existing major customers, in an effort to mitigate risks brought by the COVID-19 pandemic.
During fiscal year ended March 31, 2022 and 2023, we took a series of measures, including tailoring our communication methods to replace physical meetings by setting up virtual meetings (e.g., Zoom meetings) with our customers on a regular basis or when required by our customers, and enhancing our presence on social media (e.g., LinkedIn) to strengthen our relationships with existing major customers, in an effort to mitigate risks brought by the COVID-19 pandemic.
Compared with fiscal year 2023, our sales volume of cables and wire harnesses decreased by 27.6% from approximately 13.17 million units in fiscal year 2023 to approximately 9.54 million units in fiscal year 2024, and our average selling prices decreased by 15.3% from US$1.69 per unit in fiscal year 2023 to US$1.43 per unit in fiscal year 2024, as we adjusted the selling prices in response to the decreased demand for our products.
Compared with the fiscal year ended March 31, 2023, our sales volume of cables and wire harnesses decreased by 27.6% from approximately 13.17 million units in the fiscal year ended March 31, 2023 to approximately 9.54 million units in the fiscal year ended March 31, 2024, and our average selling prices decreased by 15.3% from US$1.69 per unit in the fiscal year ended March 31, 2023 to US$1.43 per unit in the fiscal year ended March 31, 2024, as we adjusted the selling prices in response to the decreased demand for our products.
Because the cost of components represents over 65% of our total cost of sales, higher or lower component costs affects our gross margins. Increases in the market price of components typically enable us to raise our selling prices.
Because the cost of components represents over 65% of our total cost of sales, higher or lower component costs affect our gross margins. Increases in the market price of components typically enable us to raise our selling prices.
Research and development expenses Research and development expenses primarily include (i) costs of materials and components for the research and development activities; (ii) salaries, welfare and insurance expenses paid to R&D employees; and (iii) manufacturing expenses for producing samples related to our research and development activities.
Research and development (“R&D”) expenses Research and development expenses primarily include (i) salaries, welfare and insurance expenses paid to R&D employees; (ii) costs of materials and components for the research and development activities; and (iii) manufacturing expenses for producing samples related to our research and development activities.
In fiscal years 2024 and 2023, revenue generated from the sales to our top ten customers represents 61.6% and 63.3% of our total revenue, respectively. However, as the Company continues to develop new customers and expand into more markets, we expect such customer concentration will diminish over time.
In the fiscal years ended March 31, 2024 and 2023, revenue generated from the sales to our top ten customers represents 61.6% and 63.3% of our total revenue, respectively. However, as the Company continues to develop new customers and expand into more markets, we expect such customer concentration will diminish over time.
Under the PRC Enterprise Income Tax Law and the Notice on Improvements to Policies of Weighted Pre-tax Deduction of Research and Development Expenses, research and development expenses incurred by an enterprise in the course of carrying out research and development activities that have not formed intangible assets are included in the profit and loss account for the curr ent year.
Under the PRC Enterprise Income Tax Law and the Notice on Improvements to Policies of Weighted Pre-tax Deduction of Research and Development Expenses, research and development expenses incurred by an enterprise in the course of carrying out research and development activities that have not formed intangible assets are included in the profit and loss account for the current year.
However, the extent of the impact of COVID-19 on our future financial results will be dependent on future developments, such as any potential resurgence of the pandemic, future government actions in response to the pandemic and the overall impact of the COVID-19 pandemic on the global economy and capital markets, among many other factors, all of which remain uncertain and unpredictable.
However, the extent of the impact of COVID-19 on our future financial results will be dependent on future developments, such as any potential resurgence of COVID-19, future government actions in response thereto and the overall impact of COVID-19 on the global economy and capital markets, among many other factors, all of which remain uncertain and unpredictable.
Other than those shown above, we did not have any significant capital and other commitments, long-term obligations, or guarantees as of March 31, 2024. 71 Off-Balance Sheet Arrangements We have not entered into any off-balance sheet financial guarantees or other off-balance sheet commitments to guarantee the payment obligations of any third parties.
Other than those shown above, we did not have any significant capital and other commitments, long-term obligations, or guarantees as of March 31, 2025. Off-Balance Sheet Arrangements We have not entered into any off-balance sheet financial guarantees or other off-balance sheet commitments to guarantee the payment obligations of any third parties.
Sales orders in China decreased because our customers had purchased products in advance from us in the fiscal year 2022 and the first half of the fiscal year 2023 in response to the expected increase of supply chain costs, resulting in a contraction in demand in the fiscal year 2024.
Sales orders in China decreased because our customers had purchased products in advance from us in the fiscal year ended March 31, 2022 and the first half of the fiscal year ended March 31, 2023 in response to the expected increase of supply chain costs, resulting in a contraction in demand in the fiscal year ended March 31, 2024.
The cash flow in fiscal year 2023 primarily reflected the purchase of new equipment of US$0.06 million for producing new products based on customer requirements, new motor vehicle of US$0.09 million, and new software of US$0.06 million for daily office operation.
The cash flow in the fiscal year ended March 31, 2023 primarily reflected the purchase of new equipment of US$0.06 million for producing new products based on customer requirements, new motor vehicle of US$0.09 million, and new software of US$0.06 million for daily office operation.
We believe that our current cash and our anticipated cash flows from operations will be sufficient to meet our anticipated working capital requirements, capital expenditures and debt repayment obligations for at least the next 12 months following the date our consolidated financial statements for the year ended March 31, 2024 were released.
We believe that our current cash and our anticipated cash flows from operations will be sufficient to meet our anticipated working capital requirements, capital expenditures and debt repayment obligations for at least the next 12 months following the date of our consolidated financial statements for the fiscal year ended March 31, 2025 were released.
The decrease of our inventory costs was primarily due to a 44.1% decrease of the total sales volume from approximately 40.93 million units in fiscal year 2023 to approximately 22.86 million units in fiscal year 2024.
The decrease of our inventory costs was primarily due to a 44.1% decrease of the total sales volume from approximately 40.93 million units in the fiscal year ended March 31, 2023 to approximately 22.86 million units in the fiscal year ended March 31, 2024.
The decrease was because our customers had purchased products in advance from us in fiscal year 2022 and the first half of the fiscal year 2023 in response to the expected increase of supply chain costs.
The decrease was because our customers had purchased products in advance from us in the fiscal year ended March 31, 2022 and the first half of the fiscal year ended March 31, 2023 in response to the expected increase of supply chain costs.
However, due to the stagnant global economy, customers preferred just-in-time procurement over stockpiling inventory since the second half of the fiscal year 2023, resulting in a contraction in customer demands.
However, due to the stagnant global economy, customers preferred just-in-time procurement over stockpiling inventory since the second half of the fiscal year ended March 31, 2023, resulting in a contraction in customer demands.
Many of our major customers are global name-brand manufacturers, such as Linak, Danfoss and Bitzer, and our relationships with many of our major customers date back many years. In fiscal years 2024 and 2023, sales to our top customers accounted for a significant portion of our total revenue.
Many of our major customers are global name-brand manufacturers, such as Linak, Danfoss, and Bitzer, and our relationships with many of our major customers date back many years. In the fiscal years ended March 31, 2024 and 2023, sales to our top customers accounted for a significant portion of our total revenue.
The decrease of labor costs was primarily because we reduced the number of manufacturing employees from 166 in fiscal year 2023 to 136 in fiscal year 2024 to improve our operational efficiency. 59 Gross Profit and Gross Profit Margin Gross profit represents our revenue less cost of revenue.
The decrease of labor costs was primarily because we reduced the number of manufacturing employees from 166 in the fiscal year ended March 31, 2023 to 136 in the fiscal year ended March 31, 2024 to improve our operational efficiency. Gross Profit and Gross Profit Margin Gross profit represents our revenue less cost of revenue.
The decrease was primarily attributable to the 52.0% decrease in our total sales volume from approximately 27.76 million units in fiscal year 2023 to approximately 13.33 million units in fiscal year 2024.
The decrease was primarily attributable to the 52.0% decrease in our total sales volume from approximately 27.76 million units in the fiscal year ended March 31, 2023 to approximately 13.33 million units in the fiscal year ended March 31, 2024.
Our revenue generated from Asia decreased by 34.9%, from US$7.44 million for the fiscal year ended March 31, 2023, to US$4.84 million for the fiscal year ended March 31, 2024, which was primarily due to the sales decreases in China of US$1.59 million, and the decrease in sales in Association of Southeast Asian Nations, or ASEAN, of US$0.99 million.
Our revenue generated from Asia decreased by 34.9%, from US$7.44 million for the fiscal year ended March 31, 2023, to US$4.84 million for the fiscal year ended March 31, 2024, which was primarily due to the sales decreases in China of US$1.59 million, and the decrease in sales in ASEAN, of US$0.99 million.
For the fiscal year ended March 31, 2023, our net cash used in financing activities was US$0.75 million, which consisted of proceeds from short-term bank loans of US$0.14 million, repaid within the fiscal year and partially offset by the repayment of a long-term bank loan of US$0.16 million, and an increase in the deferred offering costs of US$0.60 million for the anticipated initial public offering of our Ordinary Shares in the U.S.
For the fiscal year ended March 31, 2023, our net cash used in financing activities was US$0.75 million, which consisted of proceeds from short-term bank loans of US$0.14 million, repaid within the fiscal year and partially offset by the repayment of a long-term bank loan of US$0.16 million, and an increase in the deferred offering costs of US$0.60 million for the IPO in the U.S.
The decrease of sales from cables and wire harnesses was primarily attributable to the decrease of sale volume, and was partially offset by increase of the overall selling prices of our cables and wire harness products.
The increase of sales of cables and wire harnesses was primarily attributable to the increase of sale volume, which was partially offset by the decrease of the overall average selling prices of our cables and wire harness products.
See “SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS” for a discussion of the uncertainties, risks and assumptions associated with these statements. Actual results and the timing of events could differ materially from those discussed in our forward-looking statements as a result of many factors, including those set forth under “Item 3. Key Information—D. Risk Factors” and elsewhere in this annual report. A.
See “SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS” for a discussion of the uncertainties, risks and assumptions associated with these statements. Actual results and the timing of events could differ materially from those discussed in our forward-looking statements as a result of many factors, including those set forth under “Item 3. Key Information—D.
Operating Results Overview We are a holding company incorporated in the Cayman Islands. As a holding company with no material operations of its own, we conduct our operations through direct wholly-owned operating subsidiaries established in Hong Kong, mainland China, the Netherlands, and Serbia, primarily in the sale, design and manufacturing of interconnect products, including connectors, cables and wire harnesses.
As a holding company with no material operations of its own, we conduct our operations through direct wholly owned operating subsidiaries established in Hong Kong, mainland China, the Netherlands, and Serbia, primarily in the sale, design, and manufacturing of interconnect products, including connectors, cables, and wire harnesses.
Major Factors Affecting our Result of Operations Our revenue is primarily derived from sales of both OEM (“original equipment manufacturer”) and ODM (“original design manufacture”) interconnect products, including connectors, cables and wire harnesses, to manufacturing companies and electronic manufacturing services (“EMS”) companies in Europe, Asia and the Americas.
Major Factors Affecting our Results of Operations Our revenue is primarily derived from sales of both OEM (“original equipment manufacturer”) and ODM (“original design manufacture”) interconnect products — including connectors, cables and wire harnesses — which we sell to manufacturing companies and electronic manufacturing services (“EMS”) companies in Asia, Europe, the Americas and Australia.
For the fiscal years ended March 31, 2023 and 2022, CCSC Interconnect NL was not subject to any income tax as it had no taxable income during these periods.
For the fiscal years ended March 31, 2025 and 2024, CCSC Interconnect NL was not subject to any income tax as it had no taxable income during these periods.
On November 7, 2023, the Company renewed leased equipment with original leases term expired on August 20, 2023 and extended the lease term for another five years to February 19, 2028. The Company will have ownership of the equipment upon maturity of the leases.
On November 7, 2023, the Company renewed leased equipment with original lease terms that expired on August 20, 2023 and extended the lease term for another five years to February 19, 2028. The Company will acquire ownership of such equipment upon maturity of the leases.
These adjustments were made in response to a decrease in revenue, leading us to scale back our investment in R&D activities for fiscal year 2024.
These adjustments were made in response to a decrease in revenue, leading us to scale back our investment in R&D activities for the fiscal year ended March 31, 2024.
This drop can be attributed to advance purchases made by our customers in response to the expected increase of supply chain costs in fiscal year 2022 and the first half of the fiscal year 2023.
This decrease can be attributed to advance purchases made by our customers in response to the expected increase of supply chain costs in the fiscal year ended March 31, 2022 and the first half of the fiscal year ended March 31, 2023.
For the fiscal years ended March 31, 2024, 2023 and 2022, we had total revenue of US$14.75 million, US$24.06 million and US$27.17 million, respectively, and net loss of US$1.30 million, net income of US$2.21 million and US$2.29 million, respectively.
For the fiscal years ended March 31, 2025, 2024, and 2023, we had total revenue of US$17.63 million, US$14.75 million, and US$24.06 million, respectively, and net loss of US$1.41 million and US$1.30 million and net income of US$2.21 million, respectively.
For the fiscal years ended March 31, 2024, 2023 and 2022, approximately 61.6%, 63.3% and 58.8% of our revenue was generated from our top ten customers, respectively.
For the fiscal years ended March 31, 2025, 2024, and 2023, approximately 60.6%, 61.6%, and 63.3% of our revenue was generated from our top ten customers, respectively.
The inventory in transit has since been fully settled when the customers received the products in the subsequent period. As of March 31, 2023, we had a total inventory balance of US$2.19 million, which primarily included raw material of US$1.42 million, to ensure sufficient raw materials were available to meet our production needs, and inventory in transit of US$0.49 million.
The inventory in transit has since been fully settled when the customers received the products in the subsequent period. 73 As of March 31, 2024, we had a total inventory balance of US$2.02 million, which primarily included raw material of US$1.78 million, to ensure sufficient raw materials were available to meet our production needs, and inventory in transit of US$0.34 million.
Cost of revenue Our cost of revenue primarily consists of the following: (i) inventory costs, which primarily include procurement costs for components for the manufacturing of our products, including 1) cables and plastics, including single wires, insulation tubes, standard connectors, plastic fabricated parts, 2) metal parts, including metal shells, metal terminals, metal fabricated parts, and 3) electronic parts, including printed circuit boards, LEDs, resistors, capacitors, transistors, inductors, thermistors, potentiometers, ferrite cores, switches and semiconductors; (ii) labor costs, which consist of salaries and benefits of employees; (iii) rental expenses for the factory and dormitory of employees; (iv) depreciation expenses on our plant, property and equipment used for production; and (v) other expenses that are directly attributable to our principle operations, which primarily include freight charges for materials and components, and electricity and water used for manufacturing.
Our revenue from other regions was mainly derived from Australia, reflecting efforts to expand our customer base in other geographic areas. 63 Cost of revenue Our cost of revenue primarily consists of the following: (i) inventory costs, which primarily include procurement costs for components for the manufacturing of our products, including 1) cables and plastics, including single wires, insulation tubes, standard connectors, plastic fabricated parts, 2) metal parts, including metal shells, metal terminals, metal fabricated parts, and 3) electronic parts, including printed circuit boards, LEDs, resistors, capacitors, transistors, inductors, thermistors, potentiometers, ferrite cores, switches, and semiconductors; (ii) labor costs, which consist of salaries and benefits of employees; (iii) rental expenses for the factory and dormitory of employees; (iv) depreciation expenses on our plant, property and equipment used for production; and (v) other expenses that are directly attributable to our principal operations, which primarily include freight charges for materials and components, and electricity and water used for manufacturing.
In fiscal 2024, as the Chinese economy experienced slow and gradual recovery from the COVID-19 pandemic, our business was not materially impacted by the COVID-19 pandemic.
In the fiscal year ended March 31, 2024, as the Chinese economy experienced slow and gradual recovery from COVID-19, our business was not materially impacted by COVID-19.
For the fiscal years ended March 31, 2023 and 2022, our labor costs amounted to US$2.87 million and US$4.23 million, respectively, representing 17.7% and 21.9% of our total cost of revenue.
For the fiscal years ended March 31, 2024 and 2023, our labor costs amounted to US$2.49 million and US$2.87 million, respectively, representing 23.0% and 17.7% of our total cost of revenue.
Netherlands Our subsidiary, CCSC Interconnect NL, was incorporated and operated in the Netherlands, is subject to enterprise income tax on the respective country’s taxable income, as determined under the tax laws and accounting standards, at a rate of 19% (15% in 2022) for the first EUR 200,000 (EUR 395,000 in 2022) of profits earned by CCSC Interconnect NL, and the remaining profits will be taxed at the existing 25.8% tax rate in 2023 and 2022.
Netherlands Our subsidiary, CCSC Interconnect NL, which was incorporated and is operated in the Netherlands, is subject to enterprise income tax on their worldwide taxable income, as determined under the tax laws and accounting standards, at a rate of 19% (15% in 2022) for the first EUR200,000 (EUR395,000 in 2022) of profits earned by CCSC Interconnect NL, and the remaining profits will continue to be taxed at the existing 25.8% tax rate in 2025, 2024 and 2023.
Accounts receivable amounted to US$2.75 million and US$2.26 million as of March 31, 2024 and 2023, respectively. All of the accounts receivable balances at March 31, 2023 have been fully collected as of the date of this report.
Accounts receivable amounted to US$2.50 million and US$2.75 million as of March 31, 2025 and 2024, respectively. All the accounts receivable balances on March 31, 2024 have been fully collected as of the date of this annual report.
The decrease was primarily attributable to (i) a 44.1% decrease in the total sales volume from approximately 40.93 million units for the fiscal year ended March 31, 2023 to approximately 22.86 million units for the fiscal year ended March 31, 2024, and (ii) a 15.3% decrease of the average selling price of our cable and wire harnesses products from US$1.69 per unit for the fiscal year ended March 31, 2023 to US$1.43 per unit for the fiscal year ended March 31, 2024. 57 Our revenue generated from the sales to our top ten customers dropped from US$15.23 million in fiscal 2023 to US$9.08 million in fiscal 2024, which is consistent with the decrease in our total revenue.
The decrease was primarily attributable to (i) a 44.1% decrease in the total sales volume from approximately 40.93 million units for the fiscal year ended March 31, 2023 to approximately 22.86 million units for the fiscal year ended March 31, 2024, and (ii) a 15.3% decrease of the average selling price of our cable and wire harnesses products from US$1.69 per unit for the fiscal year ended March 31, 2023 to US$1.43 per unit for the fiscal year ended March 31, 2024.
Dividends paid by our PRC subsidiary in China to our Hong Kong subsidiary, CCSC Technology Group, will be subject to a withholding tax rate of 10%, unless the relevant Hong Kong entity satisfies all the requirements under the Double Taxation Avoidance Arrangement and receives approval from the relevant tax authority.
We are also subject to surcharges on value-added tax payments in accordance with PRC laws. 72 Dividends paid by our PRC subsidiary in China to our Hong Kong subsidiary, CCSC Technology Group, will be subject to a withholding tax rate of 10%, unless the relevant Hong Kong entity satisfies all the requirements under the Double Taxation Avoidance Arrangement and receives approval from the relevant tax authority.
Hong Kong According to Tax (Amendment) (No. 3) Ordinance 2019 published by Hong Kong government, effective April 1, 2019, under the two-tiered profits tax rates regime, the profits tax rate for the first HK$2 million of assessable profits was reduced to 8.25% (half of the rate specified in Schedule 8 to the Inland Revenue Ordinance (IRO)) for corporations and 16.5% on any part of assessable profits over HK$2,000,000.
Hong Kong According to Tax (Amendment) (No. 3) Ordinance 2019 published by Hong Kong government, effective April 1, 2019, under the two-tiered profits tax rates regime, the profits tax rate for the first HK$2 million of assessable profits was reduced to 8.25% (half of the rate specified in Schedule 8 to the Inland Revenue Ordinance (IRO)) for corporations, while the remaining profits will continue to be taxed at the existing 16.5% tax rate.
General and administrative expenses General and administrative expenses primarily consist of: (i) salaries and benefits for our administrative personnel; (ii) depreciation and amortization expenses relating to our property, plant and equipment and leased properties used for administrative purposes; (iii) office expenses, expenses for office supplies and consumables; (iv) agent and professional fees related to our initial public offering in the U.S.; and (v) other expenses, which primarily include utilities, traveling, entertainment, repair and maintenance, rental and other miscellaneous expenses for administrative purposes.
General and administrative expenses General and administrative expenses primarily consist of: (i) salaries and benefits for our administrative personnel; (ii) agent and professional fees related to our IPO, including both one-time IPO-related costs and recurring public company compliance expenses; (iii) office expenses, expenses for office supplies and consumables; (iv) depreciation and amortization expenses relating to our property, plant and equipment and leased properties used for administrative purposes; and (v) other expenses, which primarily include utilities, traveling, entertainment, repair and maintenance, rental and other miscellaneous expenses for administrative purposes.
Cost of revenue Our cost of revenue primarily consists of the following: (i) inventory costs, which primarily include procurement costs for components for the manufacturing of our products, including 1) cables and plastics, including single wires, insulation tubes, standard connectors, plastic fabricated parts, 2) metal parts, including metal shells, metal terminals, metal fabricated parts, and 3) electronic parts, including printed circuit boards, LEDs, resistors, capacitors, transistors, inductors, thermistors, potentiometers, ferrite cores, switches and semiconductors; (ii) labor costs, which consist of salaries and benefits of employees; (iii) rental expenses for the factory and dormitory of employees; (iv) depreciation expenses on our plant, property and equipment used for production; and (v) other expenses that are directly attributable to our principle operations, which primarily include freight charges for materials and components, and electricity and water used for manufacturing.
Our revenue generated from the Americas decreased by 12.4%, from US$1.58 million for the fiscal year ended March 31, 2023 to US$1.38 million for the year ended March 31, 2024, which was primarily due to the sales decrease in North America of US$0.19 million. 69 Cost of revenue Our cost of revenue primarily consists of the following: (i) inventory costs, which primarily include procurement costs for components for the manufacturing of our products, including 1) cables and plastics, including single wires, insulation tubes, standard connectors, plastic fabricated parts, 2) metal parts, including metal shells, metal terminals, metal fabricated parts, and 3) electronic parts, including printed circuit boards, LEDs, resistors, capacitors, transistors, inductors, thermistors, potentiometers, ferrite cores, switches and semiconductors; (ii) labor costs, which consist of salaries and benefits of employees; (iii) rental expenses for the factory and dormitory of employees; (iv) depreciation expenses on our plant, property and equipment used for production; and (v) other expenses that are directly attributable to our principle operations, which primarily include freight charges for materials and components, and electricity and water used for manufacturing.
As of the date of this annual report, we have financed our operations primarily through cash generated from our operations and the net proceeds raised from our initial public offering in January 2024. We intend to continue relying on these funding sources to support our future operations, and may consider seeking additional financing such as bank loans as needed.
As of the date of this annual report, we have financed our operations primarily through cash generated from our operations and with a portion of the net proceeds raised from our IPO. We intend to continue relying on cash generated from our operations to support our future operations, and may consider seeking additional financing such as bank loans as needed.
Our revenue generated from the Americas decreased by 12.4%, from US$1.58 million for the fiscal year ended March 31, 2023 to US$1.38 million for the year ended March 31, 2024, which was primarily due to the sales decrease in North America of US$0.19 million.
Our revenue generated from the Americas decreased by 5.7%, from US$1.38 million for the fiscal year ended March 31, 2024 to US$1.30 million for the fiscal year ended March 31, 2025, which was primarily due to a sales decrease in North America of US$0.08 million .
On November 23, 2023, the Company combined and renewed leased office with two original leases term expired on November 31, 2023 and extended the lease term for another two years to November 30, 2025.
On November 23, 2023, the Company combined and renewed leased offices with two original leases once the terms expired on November 31, 2023 and extended the lease term for the combined space another two years to November 30, 2025. The Company intends to renew the lease once it expires.
For the fiscal years ended March 31, 2023 and 2022, our total revenue was US$24.06 million and US$27.17 million, respectively. During these periods, we derived all of our revenue from sales in Europe, Asia and the Americas.
For the fiscal years ended March 31, 2025 and 2024, our total revenue was US$17.63 million and US$14.75 million, respectively. During these periods, we derived all of our revenue from sales in Europe, Asia, Americas, and Australia.
General and administrative expenses General and administrative expenses primarily consist of: (i) salaries and benefits for our administrative personnel; (ii) depreciation and amortization expenses relating to our property, plant and equipment and leased properties used for administrative purposes; (iii) office expenses, represents expenses for office supplies and consumables; (iv) agent and professional fees related to our proposed initial public offering in the U.S.; and (v) other expenses, which primarily include utilities, traveling, repair and maintenance, rental and other miscellaneous expenses for administrative purposes.
General and administrative expenses General and administrative expenses primarily consist of: (i) salaries and benefits for our administrative personnel; (ii) depreciation and amortization expenses relating to our property, plant and equipment and leased properties used for administrative purposes; (iii) office expenses, expenses for office supplies and consumables; (iv) agent and professional fees related to our IPO, including both one-time IPO-related costs and recurring public company compliance expenses; and (v) other expenses, which primarily include utilities, traveling, entertainment, repair and maintenance, rental and other miscellaneous expenses for administrative purposes.
Investing activities Our net cash used in investing activities was US$3.83 million, US$0.21 million and US$0.18 million for the fiscal years ended March 31, 2024, 2023 and 2022, respectively. The cash flow in fiscal year 2024 primarily reflected the purchase of new equipment and software of US$0.19 million and prepayment of long-term equipment and mold model of US$3.64 million.
Investing activities Our net cash used in investing activities was US$0.89 million, US$3.83 million, and US$0.21 million for the fiscal years ended March 31, 2025, 2024, and 2023, respectively. The cash flow in the fiscal year ended March 31, 2025 primarily reflected the purchase of land of US$0.52 million and the purchase of new equipment and software of US$0.37 million.
Our revenue generated from connectors accounted for 7.6% of our total revenue and decreased by 39.3% from US$1.85 million for the fiscal year ended March 31, 2023 to US$1.12 million for the fiscal year ended March 31, 2024.
Our revenue generated from connectors accounted for 7.1% of our total revenue and increased by 11.1% from US$1.12 million for the fiscal year ended March 31, 2024 to US$1.25 million for the fiscal year ended March 31, 2025.
If, in the future, we determine that we would not be able to realize our recorded deferred tax assets, an increase in the valuation allowance would decrease our earnings in the period in which such determination is made. As of March 31, 2024 and 2023, the Company recorded $121,016 and $90,991 valuation allowance for the deferred tax assets.
If, in the future, we determine that we would not be able to realize our recorded deferred tax assets, an increase in the valuation allowance would decrease our earnings in the period in which such determination is made.
For R&D expenses that have formed intangible assets, the tax amortization is based on 200% of the costs of the intangible assets 。 Our income tax benefit/(expense) decreased from tax expense of US$0.28 million for the fiscal year ended March 31, 2023 to tax benefit of US$0.09 million for the fiscal year ended March 31, 2024, which was due to the loss of CCSC Interconnect DG in fiscal year 2024.
Our income tax benefit/(expense) decreased from tax expense of US$0.28 million for the fiscal year ended March 31, 2023 to tax benefit of US$0.09 million for the fiscal year ended March 31, 2024, which was due to the loss of CCSC Interconnect DG in the fiscal year ended March 31, 2024.
Some factors that may affect our ability to meet customer demands and to attract customers include our ability to (i) design and manufacture products from the perspective of our customers in terms of raw material selection, functional and structural specifications, and technical requirements; (ii) invest in the branding, sales and marketing to acquire new customers and maintain long-term business relationships with many of our key customers; and (iii) attract new potential customers through attending the worldwide exhibitions such as the Electronica trade fair. 55 Impact of the COVID-19 pandemic on Our Operations and Financial Performance Our results of operations and financial condition were negatively affected by the COVID-19 pandemic, and could continue to be further affected by the ongoing COVID-19 pandemic, the extent of which will depend on the future developments of the pandemic, which are highly uncertain and unpredictable.
Some factors that may affect our ability to meet customer demands and to attract customers include our ability to (i) design and manufacture products from the perspective of our customers in terms of raw material selection, functional and structural specifications, and technical requirements; (ii) invest in the branding, sales and marketing to acquire new customers and maintain long-term business relationships with many of our key customers; and (iii) attract new potential customers through attending the worldwide exhibitions such as the Electronica trade fair.
Our inventory costs represented a significant portion of our cost of revenue. For the fiscal years ended March 31, 2023 and 2022, our inventory costs amounted to US$12.10 million and US$14.22 million, respectively, representing 74.8% and 72.2% of our total cost of revenue for such respective periods.
Our inventory costs represented a significant portion of our cost of revenue. For the fiscal years ended March 31, 2025 and 2024, our inventory costs amounted to US$8.58 million and US$7.34 million, respectively, representing 67.8% and 67.8% of our total cost of revenue for such respective periods.
Research and development (“R&D”) expenses Research and development expenses primarily include (i) costs of materials and components for the research and development activities; (ii) salaries, welfare and insurance expenses paid to R&D employees; and (iii) manufacturing expenses for producing samples related to our research and development activities. 60 Our research and development expenses decreased by 45.2%, or US$0.49 million from US$1.08 million for the fiscal year ended March 31, 2023 to US$0.59 million for the fiscal year ended March 31, 2024, primarily due to a decrease in the materials and components consumption and employee salaries.
Our research and development expenses decreased by 45.2%, or US$0.49 million from US$1.08 million for the fiscal year ended March 31, 2023 to US$0.59 million for the fiscal year ended March 31, 2024, primarily due to a decrease in the materials and components consumption and employee salaries.
As a result, the average cost of the components and materials used in our products increased by 15.5% per unit in fiscal year 2023 as compared with fiscal year 2022. To counter the higher costs, we had to raise the average selling price of our products by 19.8% per unit in fiscal year 2023.
As a result, the average cost of the components and materials used in our products increased by 15.5% per unit in fiscal year ended March 31, 2023 as compared with fiscal year ended March 31, 2022.
Liquidity and Capital Resources As of March 31, 2024, we had US$5.73 million in cash and restricted cash, which consisted of (i) cash in mainland China of US$2.67 million; (ii) cash in HK of US$3.03 million; and (iii) cash and restricted cash in the Netherlands of US$0.03 million.
Liquidity and Capital Resources As of March 31, 2025, we had US$3.69 million in cash and restricted cash, which consisted of (i) cash in mainland China of US$0.69 million; (ii) cash in Hong Kong of US$2.85 million; (iii) cash and restricted cash in the Netherlands of US$0.07 million; and (iv) cash in Serbia of US$0.08 million.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Compensation Committee. Our compensation committee consists of Tsz Fai Shiu, Wai Chun Tsang, and Kenneth Wang. Tsz Fai Shiu is the chairperson of our compensation committee. The compensation committee assists the board of directors in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers.
Our compensation committee consists of Tsz Fai Shiu, Wai Chun Tsang, and Kenneth Wang. Tsz Fai Shiu is the chairperson of our compensation committee. The compensation committee assists the board of directors in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers.
The compensation committee will be responsible for, among other things: ● reviewing and approving the total compensation package for our most senior executive officers; 77 ● approving and overseeing the total compensation package for our executives other than the most senior executive officers; ● reviewing and recommending to the board with respect to the compensation of our directors; ● reviewing periodically and approving any long-term incentive compensation or equity plans; ● selecting compensation consultants, legal counsel or other advisors after taking into consideration all factors relevant to that person’s independence from management; and ● reviewing programs or similar arrangements, annual bonuses, employee pension and welfare benefit plans.
The compensation committee will be responsible for, among other things: ● reviewing and approving the total compensation package for our most senior executive officers; ● approving and overseeing the total compensation package for our executives other than the most senior executive officers; ● reviewing and recommending to the board with respect to the compensation of our directors; ● reviewing periodically and approving any long-term incentive compensation or equity plans; ● selecting compensation consultants, legal counsel or other advisors after taking into consideration all factors relevant to that person’s independence from management; and ● reviewing programs or similar arrangements, annual bonuses, employee pension and welfare benefit plans.
Chiu was awarded a New Generation Enterprise Elite Award from Hong Kong Federation of Innovative Technologies and Manufacturing Industries in July 2022. Mr. Chiu supports public welfare undertakings and was awarded the Best Social Responsibility Award from the Guangdong-HK-Macao Bay Area Entrepreneurs Union in September 2022. Mr. Kwok Kwan Chan has served as our COO since October 2021.
Chiu was awarded a New Generation Enterprise Elite Award from Hong Kong Federation of Innovative Technologies and Manufacturing Industries in July 2022. Mr. Chiu supports public welfare undertakings and was awarded the Best Social Responsibility Award from the Guangdong-HK-Macao Bay Area Entrepreneurs Union in September 2022. 78 Mr. Kwok Kwan Chan has served as our COO since October 2021.
Shiu holds a Bachelor’s degree in social service and social work from Hong Kong Polytechnic University, a Master’s degree in business administration from Sheffield Hallam University in United Kingdom, and a Doctorate degree in business administration from Bulacan State University in Philippines. Mr. Kenneth Wang has been an independent director since December 2023.
Shiu holds a Bachelor’s degree in social service and social work from Hong Kong Polytechnic University, a Master’s degree in business administration from Sheffield Hallam University in United Kingdom, and a Doctorate degree in business administration from Bulacan State University in Philippines. 79 Mr. Kenneth Wang has been an independent director since December 2023.
The audit committee is responsible for, among other things: ● appointing the independent auditors and pre-approving all auditing and non-auditing services permitted to be performed by the independent auditors; ● reviewing with the independent auditors any audit problems or difficulties and management’s response; ● discussing the annual audited financial statements with management and the independent auditors; ● reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any steps taken to monitor and control major financial risk exposures; ● reviewing and approving all proposed related party transactions; ● meeting separately and periodically with management and the independent auditors; and ● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.
The audit committee is responsible for, among other things: ● appointing the independent auditors and pre-approving all auditing and non-auditing services permitted to be performed by the independent auditors; ● reviewing with the independent auditors any audit problems or difficulties and management’s response; ● discussing the annual audited financial statements with management and the independent auditors; ● reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any steps taken to monitor and control major financial risk exposures; ● reviewing and approving all proposed related party transactions; ● meeting separately and periodically with management and the independent auditors; and ● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance. 82 Compensation Committee.
Controlled Company Our biggest shareholder, our director and chairman of the Board, Dr. Chi Sing Chiu, owns approximately 72.58% of the aggregate voting power of our outstanding Ordinary Shares as of the date of this annual report. As a result, we may be deemed to be a “controlled company” within the meaning of the NASDAQ listing standards. Dr.
Controlled Company Our biggest shareholder, our director and chairman of the Board, Dr. Chi Sing Chiu, owns approximately 98.72% of the aggregate voting power of our outstanding Ordinary Shares as of the date of this annual report. As a result, we may be deemed to be a “controlled company” within the meaning of the NASDAQ listing standards. Dr.
Information on the Company—B. Business Overview—Employees.” E. Share Ownership The following table sets forth information regarding the beneficial ownership of our Ordinary Shares as of the date of this report by our officers, directors, and 5% or greater beneficial owners of Ordinary Shares.
Information on the Company-B. Business Overview-Employees.” 83 E. Share Ownership The following table sets forth information regarding the beneficial ownership of our Ordinary Shares as of the date of this annual report by our officers, directors, and 5% or greater beneficial owners of Ordinary Shares.
Since 2005, he has been working for Knowing Management Consultancy, where he serves as the principal consultant and training director. His responsibilities include: overall office administration and management, formulating marketing strategies and performing marketing functions, providing consulting and training services to individual and corporate clients. Mr.
Tsz Fai Shiu has been an independent director since December 2023. Since 2005, he has been working for Knowing Management Consultancy, where he serves as the principal consultant and training director. His responsibilities include: overall office administration and management, formulating marketing strategies and performing marketing functions, providing consulting and training services to individual and corporate clients. Mr.
B. Compensation For the year ended March 31, 2024, we paid an aggregate of approximately US$1,126,756 in cash to our executive officers and directors, and we paid an aggregate of US$21,600 in cash to our non-executive directors. This amount consisted only of cash and did not include any share-based compensation or benefits in kind.
B. Compensation For the year ended March 31, 2025, we paid an aggregate of approximately US$ 1,075,676 in cash to our executive officers and directors, and we paid an aggregate of US$ 86,400 in cash to our non-executive directors. This amount consisted only of cash and did not include any share-based compensation or benefits in kind.
From May 2016 to September 2021, she was responsible for overseeing the overall administration and human resources affairs and served as the manager of the finance department of CCSC Interconnect HK. Ms. Chiu holds a Bachelor’s degree in Bioscience (nutrition) from the University of Nottingham. Dr. Wai Chun Tsang has been an independent director since December 2023.
Sin Ting Chiu has served as a director of the Company since October 2021. From May 2016 to September 2021, she was responsible for overseeing the overall administration and human resources affairs and served as the manager of the finance department of CCSC Interconnect HK. Ms. Chiu holds a Bachelor’s degree in Bioscience (nutrition) from the University of Nottingham. Dr.
Percentage of beneficial ownership is calculated based on 11,581,250 Ordinary Shares issued and outstanding as of the date of this annual report. 78 Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
Percentage of beneficial ownership is calculated based on 6,581,250 Class A Ordinary Shares and 5,000,000 Class B Ordinary Shares issued and outstanding as of the date of this annual report. Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
We have the right to seek damages if a duty owed by any of our directors is breached. 76 Terms of Directors and Executive Officers Each of our directors holds office until a successor has been duly elected and qualified unless the director was appointed by the board of directors, in which case such director holds office until the next annual meeting of shareholders at which time such director is eligible for re-election.
Terms of Directors and Executive Officers Each of our directors holds office until a successor has been duly elected and qualified unless the director was appointed by the board of directors, in which case such director holds office until the next annual meeting of shareholders at which time such director is eligible for re-election.
Ordinary Shares Beneficially Owned Number Percent Directors and Executive Officers*: Chi Sing Chiu (1) 8,406,000 72.58 % Kung Lok Chiu — 0 % Kwok Kwan Chan, Chee Hui Law, Chi Man Chan (William) (2) 300,000 2.59 % Sin Ting Chiu — 0 % Wai Chun Tsang — 0 % Tsz Fai Shiu — 0 % Kenneth Wang — 0 % Pak Keung Chan — 0 % Directors and Executive Officers as a group 75.17 % 5% Shareholders**: CCSC Investment Limited (1) 8,406,000 72.58 % * Unless otherwise indicated, the business address of each of the individuals is 1301-03, 13/f Shatin Galleria, 18-24Shan Mei St, Fotan, Shatin, Hong Kong. ** The principal office of the 5% beneficial owner is located at 1301-03, 13/f Shatin Galleria, 18-24 Shan Mei St, Fotan, Shatin, Hong Kong.
Class A Ordinary Shares Class B Ordinary Shares % of Beneficial Ownership % of Aggregate Voting Power Directors and Executive Officers*: Chi Sing Chiu (1) 3,292,770 5,000,000 71.61 % 98.72 % Kung Lok Chiu - - - - Kwok Kwan Chan, Chee Hui Law, and Chi Man Chan (William) (2) 186,770 - 1.61 % 0.07 % Sin Ting Chiu - - - Wai Chun Tsang - - - - Tsz Fai Shiu - - - - Kenneth Wang - - - - Pak Keung Chan - - - - Jung Yi Chiu - - - - 5% Shareholders**: CCSC Investment Limited (1) 3,292,770 5,000,000 71.61 % 98.72 % * Unless otherwise indicated, the business address of each of the individuals is 1301-03, 13/f Shatin Galleria, 18-24Shan Mei St, Fotan, Shatin, Hong Kong. ** The principal office of the 5% beneficial owner is located at 1301-03, 13/f Shatin Galleria, 18-24 Shan Mei St, Fotan, Shatin, Hong Kong.
Name Age Position(s) Chi Sing Chiu 64 Chairman of the board, director Kung Lok Chiu 35 Chief Executive Officer (“CEO”), director Kwok Kwan Chan 56 Chief Operation Officer (“COO”) Chee Hui Law 45 Chief Finance Officer (“CFO”) Chi Man Chan, William 60 Chief Sale Officer (“CSO”) Sin Ting Chiu 37 Director Wai Chun Tsang 69 Independent director Tsz Fai Shiu 60 Independent director Kenneth Wang 70 Independent director Pak Keung Chan 86 Independent director 73 Dr.
Name Age Position(s) Chi Sing Chiu 65 Chairman of the board, director Kung Lok Chiu 36 Chief Executive Officer (“CEO”), director Kwok Kwan Chan 57 Chief Operation Officer (“COO”) Chee Hui Law 46 Chief Finance Officer (“CFO”) Chi Man Chan, William 61 Chief Sale Officer (“CSO”) Jung Yi Chiu 62 Chief Strategy Officer Sin Ting Chiu 38 Director Wai Chun Tsang 70 Independent director Tsz Fai Shiu 61 Independent director Kenneth Wang 71 Independent director Pak Keung Chan 87 Independent director Dr.
Agreements with Named Executive Officers We have entered into employment agreement with each of our executive officers. Pursuant to employment agreements, the form of which is filed as Exhibit 4.1 to this annual report.
Agreements with Named Executive Officers We have entered into employment agreement with each of our executive officers. Pursuant to employment agreements, the form of which was filed as Exhibit 4.1 to the annual report on Form 20-F filed by the Company with the SEC on July 22, 2024 and is hereby incorporated by reference into this annual report.
In April 2000, she founded TWC Corporate Services Ltd., a company that provides accounting, corporate and private equity fund administration services, and has since served as a managing director, responsible for overall supervision of the company. Currently, she serves as a director of ten companies, including a Hong Kong listed company, Timeless Software Ltd. Ms.
Wai Chun Tsang has been an independent director since December 2023. In April 2000, she founded TWC Corporate Services Ltd., a company that provides accounting, corporate and private equity fund administration services, and has since served as a managing director, responsible for overall supervision of the company.
(1) Dr. Chi Sing Chiu, chairman of the board of directors, beneficially owns 8,406,000 Ordinary Shares through his 69.20% ownership of CCSC Investment Limited, which owns 72.58% of the issued and outstanding shares of the Company.
(1) Dr. Chi Sing Chiu, chairman of the board of directors, beneficially owns 3,292,770 Class A Ordinary Shares and 5,000,000 Class B Ordinary Shares through his 69.20% ownership of CCSC Investment Limited.
Duties of Directors Under Cayman Islands law, all of our directors owe three types of duties to us: (i) statutory duties, (ii) fiduciary duties, and (iii) common law duties. The Companies Act (As Revised) of the Cayman Islands imposes a number of statutory duties on a director.
Board Practices Board of Directors Our board of directors consists of seven directors. 81 Duties of Directors Under Cayman Islands law, all of our directors owe three types of duties to us: (i) statutory duties, (ii) fiduciary duties, and (iii) common law duties.
Tsang holds a diploma in secretarial management from Hong Kong Baptist College, an MBA from Heriot-Watt University, an Honorary Doctorate degree in business administration from Sabi University in France, and a Doctorate degree from International American University. 74 Dr. Tsz Fai Shiu has been an independent director since December 2023.
Currently, she serves as a director of ten companies, including a Hong Kong listed company, Timeless Software Ltd. Ms. Tsang holds a diploma in secretarial management from Hong Kong Baptist College, an MBA from Heriot-Watt University, an Honorary Doctorate degree in business administration from Sabi University in France, and a Doctorate degree from International American University. Dr.
In fulfilling their duty of care to us, our directors must ensure compliance with our amended articles of association, as amended and restated from time to time.
In fulfilling their duty of care to us, our directors must ensure compliance with our New M&A, as amended and restated from time to time. We have the right to seek damages if a duty owed by any of our directors is breached.
(2) Kwok Kwan Chan, Chee Hui Law and Chi Man Chan (William) jointly beneficially own 300,000 Ordinary Shares through their 23.89%, 21.66% and 23.89% ownership of Cyber Generations Investment Limited, which owns 2.59% of the issued and outstanding shares of the Company.
(2) Kwok Kwan Chan, Chee Hui Law, and Chi Man Chan (William) jointly beneficially own 186,770 Class A Ordinary Shares through their 23.89%, 21.66% and 23.89% ownership of Cyber Generations Investment Limited. As of the date of this annual report, none of our Ordinary Shares are held by record holders in the United States.
With over twenty-five years of experience in sales of interconnect products, we believe Mr. Chan is well qualified to serve as our CSO. Ms. Sin Ting Chiu has served as a director of the Company since October 2021.
With over twenty-five years of experience in sales of interconnect products, we believe Mr. Chan is well qualified to serve as our CSO. Mr. Jung Yi Chiu has served as or Chief Strategy Officer since May 2024. Mr. Chiu has over 30 years of experience in various leadership roles in the electronics industry, specializing in sales, marketing, and business development.
We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our directors and executive officers. The compensation committee will assist the directors in reviewing and approving the compensation structure for the directors and the executive officers. C. Board Practices Board of Directors Our board of directors consists of seven directors.
We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our directors and executive officers. 80 The compensation committee will assist the directors in reviewing and approving the compensation structure for the directors and the executive officers. 2024 Share Incentive Plan Our shareholders adopted the 2024 performance incentive plan (the “2024 Plan”) on September 10, 2024, effective as of the same date, to attract and retain the best available personnel, provide additional incentives to employees, directors, and consultants, and promote the success of our business.
None of the other directors or executive officers has a family relationship as defined in Item 401 of Regulation S-K. Board Diversity The table below provides certain information regarding the diversity of our board of directors as of the date of this annual report.
None of the other directors or executive officers has a family relationship as defined in Item 401 of Regulation S-K. Involvement in Certain Legal Proceedings To the best of our knowledge, none of our directors or executive officers has, during the past ten years, been involved in any legal proceedings described in subparagraph (f) of Item 401 of Regulation S-K.
We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. F. Disclosure of a registrant’s action to recover erroneously awarded compensation As detailed in Note 17 of “Item 18. Financial Statement”, the Company made a revision relating to deductible VAT-Input in prepaid expenses and other current assets.
None of our shareholders has informed us that it is affiliated with a registered broker-dealer or is in the business of underwriting securities. 84 We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. F. Disclosure of a registrant’s action to recover erroneously awarded compensation Not applicable.
Removed
Board Diversity Matrix Country of Principal Executive Offices: Hong Kong, China Foreign Private Issuer Yes Disclosure Prohibited under Home Country Law No Total Number of Directors 7 Female Male Non- Binary Did Not Disclose Gender Part I: Gender Identity Directors 2 5 0 0 Part II: Demographic Background Underrepresented Individual in Home Country Jurisdiction 0 LGBTQ+ 0 Did Not Disclose Demographic Background 0 75 Involvement in Certain Legal Proceedings To the best of our knowledge, none of our directors or executive officers has, during the past ten years, been involved in any legal proceedings described in subparagraph (f) of Item 401 of Regulation S-K.
Added
Mr. Chiu joined the Company in August 2020 as the Development Strategy Officer, and has since led strategic initiatives to drive Industry 4.0-related projects and new business development at the Company. Prior to joining the Company, Mr.
Removed
As of the date of this report, none of our Ordinary Shares are held by record holders in the United States. None of our shareholders has informed us that it is affiliated with a registered broker-dealer or is in the business of underwriting securities.
Added
Chiu held senior positions at multiple electronics companies, including Kenmec Group and AVC Thermal Cooling Corporation (both are listed companies on the Taipei Exchange). Mr. Chiu holds a Master’s degree in Industrial Management and a Bachelor’s degree in Electrical Engineering from the National Taiwan University of Science and Technology. Ms.
Removed
The Company concluded that this adjustment was immaterial to the consolidated financial statements as of March 31, 2023, 2022, and 2021.
Added
Under the 2024 Plan, the maximum aggregate number of shares that may be issued pursuant to all awards is 2,200,000 Class A Ordinary Shares. As of the date of this annual report, we have not issued any awards under the 2024 Plan. The following describes the principal terms of the 2024 Plan.
Removed
The Company's compensation was determined on a fixed amount, and no incentive-based compensation received on or after October 2, 2023 was based on the attainment of a financial reporting measure affected by this revision of the Company’s consolidated financial statements.
Added
Types of awards The 2024 Plan permits the awards of cash, restricted stock units, share options, or any similar securities with a value derived from the value of or related to the Class A Ordinary Shares and/or returns thereon. Plan Administration Our board of directors or a committee of one or more board members administers the 2024 Plan.
Removed
Consequently, the Company concludes that as of the date of this annual report, no recovery of erroneously awarded compensation is mandated under the Company’s compensation recovery policy, a copy of which is attached as Exhibit 97.1 to this annual report.
Added
The committee or the full board, as applicable, determines the participants, the type and number of awards to be granted to each participant, and the terms and conditions of each award.
Added
Award Agreement Each awards granted under the 2024 Plan will be evidenced by an award agreement that will set forth terms, conditions, and limitations, which may include the provisions applicable in the event the grantee’s employment or service terminates, and our authority to unilaterally or bilaterally amend, modify, suspend, cancel or rescind the award.
Added
Eligibility We may grant awards to our employees, directors, and consultants of our Company, and other individuals, as determined by the plan administrator. Vesting Schedule In general, the plan administrator determines the vesting schedule, which will be specified in the award agreement.
Added
Exercise of Options The plan administrator will determine the exercise price for each award, which will be stated in the award agreement. C.
Added
The Companies Act (As Revised) of the Cayman Islands imposes a number of statutory duties on a director.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

13 edited+1 added−4 removed12 unchanged
Board of Directors—Agreements with Named Executive Officers.” Policies and Procedures for Related Party Transactions Our board of directors has established an audit committee that is tasked with reviewing and approving all related party transactions. C. Interests of Experts and Counsel Not applicable. 80 Item 8. FINANCIAL INFORMATION A.
Board of Directors-Agreements with Named Executive Officers.” Policies and Procedures for Related Party Transactions Our board of directors has established an audit committee that is tasked with reviewing and approving all related party transactions. C. Interests of Experts and Counsel Not applicable. Item 8. FINANCIAL INFORMATION A.
As of the date of this report, we have not applied for the tax resident certificate from the relevant Hong Kong tax authority. CCSC Technology Group, intends to apply for the tax resident certificate when CCSC Interconnect DG plans to declare and pay dividends to it.
As of the date of this annual report, we have not applied for the tax resident certificate from the relevant Hong Kong tax authority. CCSC Technology Group, intends to apply for the tax resident certificate when CCSC Interconnect DG plans to declare and pay dividends to it.
If we determine to pay dividends on any of our Ordinary Shares in the future, as a holding company, we will be dependent on receipt of funds from our direct wholly-owned subsidiaries.
If we determine to pay dividends on any of our Class A Ordinary Shares in the future, as a holding company, we will be dependent on receipt of funds from our direct wholly-owned subsidiaries.
We may rely on dividends from our subsidiaries for our cash requirements, including any payment of dividends to our shareholders. We have not declared or paid any dividends. We do not have any present plan to pay any cash dividends on our Ordinary Shares in the foreseeable future.
We may rely on dividends from our subsidiaries for our cash requirements, including any payment of dividends to our shareholders. We have not declared or paid any dividends. We do not have any present plan to pay any cash dividends on our Class A Ordinary Shares in the foreseeable future.
Item 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. Major Shareholders See “Item 6. Directors, Senior Management and Employees—E. Share Ownership.” 79 B. Related Party Transactions Transactions with Related Parties Sales to Related Parties For the fiscal years ended March 31, 2024, 2023 and 2022, the Company did not sell goods to its related parties.
Item 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. Major Shareholders See “Item 6. Directors, Senior Management and Employees-E. Share Ownership.” B. Related Party Transactions Transactions with Related Parties Sales to Related Parties For the fiscal years ended March 31, 2025, 2024, and 2023, the Company did not sell goods to its related parties.
If we pay any dividends, cash dividends on our Ordinary Shares, if any, will be paid in U.S. dollars. B. Significant Changes Except as disclosed elsewhere in this annual report, we have not experienced any significant changes since the date of our audited consolidated financial statements included in this annual report.
If we pay any dividends, cash dividends on our Class A Ordinary Shares, if any, will be paid in U.S. dollars. 86 B. Significant Changes Except as disclosed elsewhere in this annual report, we have not experienced any significant changes since the date of our audited consolidated financial statements included in this annual report.
Chi Sing Chiu and Woon Bing Yeung, who jointly own 72.58% of the Company’s shares through CCSC Investment Limited, provided personal guarantees for a bank loan in the amount of $464,354 (HK$3,600,000) with a 3-year term, from June 30, 2020 to June 29, 2023, from Bank of China (HK) Limited (“BOCHK”).
Chi Sing Chiu and Woon Bing Yeung, who jointly own 71.61% of the Company’s shares through CCSC Investment Limited, provided personal guarantees for a bank loan in the amount of $464,354 (HK$3,600,000) with a 3-year term, from June 30, 2020 to June 29, 2023, from Bank of China (HK) Limited (“BOCHK”).
Under Cayman Islands law, a Cayman Islands company may pay a dividend on its shares out of either profits, if any, or share premium amounts, provided that under no circumstances may a dividend be paid if this would result in the company being unable to pay its debts due in the ordinary course of business.
Under Cayman Islands law, a Cayman Islands company may pay a dividend on its shares out of either profits, if any, or share premium amounts, provided that under no circumstances may a dividend be paid if this would result in the company being unable to pay its debts due in the ordinary course of business immediately following the date on which the dividend is paid .
The personal guarantees for the bank loan were released as the balance was fully repaid in June 2023. The balance of the loan was $196,165, $39,725, and $0, as of March 31, 2022, 2023 and 2024, respectively. During the fiscal year ended March 31, 2022, Dr.
The personal guarantees for the bank loan were released as the balance was fully repaid in June 2023. During the fiscal year ended March 31, 2022, Dr.
Chi Sing Chiu, made unsecured, interest-free and due upon demand loans to the Company for working capital. The balance was fully repaid in May 2022. As of March 31, 2022, 2023 and 2024, the Company had $215,619, $0 and $0, respectively, due to Woon Bing Yeung. Loan Guaranteed by Related Parties Dr.
The loan was unsecured, interest free and due upon demand. The loan was fully repaid in May 2022. Loans from Related Parties Woon Bing Yeung, a shareholder of CCSC Investment Limited that owns 71.61% shares of the Company and the wife of Dr. Chi Sing Chiu, made unsecured, interest-free and due upon demand loans to the Company for working capital.
As of the date of this report, the Company did not sell goods to its related parties in fiscal year 2025. Purchases from Related Parties For the fiscal year ended March 31, 2022, the Company made prepayments of $84,871 to Dongguan Concord Internet of Things Seienct Technology Ltd, a company owned by Dr.
As of the date of this annual report, the Company has not sold goods to its related parties in the fiscal year ended March 31, 2026. Purchases from Related Parties For the fiscal years ended March 31, 2025, 2024, and 2023, the Company did not purchase goods from its related parties.
Loans to Related Parties The Company provided a loan in the amount of $433,689 to Dr. Chi Sing Chiu, the controlling shareholder and chairman of the board of director of the Company. The loan was unsecured, interest free and due upon demand. The loan was fully repaid in May 2022.
As of the date of this annual report, the Company has not purchased goods from its related parties in the fiscal year ended March 31, 2026. Loans to Related Parties The Company provided a loan in the amount of $433,689 to Dr. Chi Sing Chiu, the controlling shareholder and chairman of the board of director of the Company.
The balances of such facilities were $0, $0, and $0 as of March 31, 2022, 2023, and 2024, respectively. Employment Agreements and Indemnification Agreements See “Item 6. Directors, Senior Management and Employees—C.
The personal guarantees for the foregoing facilities were released because the Company ceased to use such facilities in May 2024. 85 Employment Agreements and Indemnification Agreements See “Item 6. Directors, Senior Management and Employees-C.
Removed
Chi Sing Chiu, the controlling shareholder and chairman of the board of director of the Company, to purchase materials. For the fiscal year ended March 31, 2022, the Company purchased materials of $32,846 from Dongguan Concord Internet of Things Seienct Technology Ltd.
Added
The balance was fully repaid in May 2022. Loan Guaranteed by Related Parties Dr.
Removed
As of March 31, 2022, the balance of the prepayment to Dongguan Concord Internet of Things Seienct Technology Ltd. was $52,025, which amount was fully refunded in June 2022. As of the date of this report, the Company did not purchase goods from its related parties in fiscal year 2025.
Removed
As of March 31 2022, 2023 and 2024, the balance of the loan was in the amount of $430,582, $0 and $0, respectively. Loans from Related Parties Woon Bing Yeung, a shareholder of CCSC Investment Limited that owns 72.58% shares of the Company and the wife of Dr.
Removed
The personal guarantees for the foregoing facilities were released because the Company ceased to use the such facilities in May 2024. This is because the Company received offering proceeds from its initial public offering completed in January 2024 to support its operations.