ADDENTAX GROUP CORP.
For the period ended Mar 31, 2026. Filed Jun 29, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Jun 29, 2026
ATXG$2.73+9.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2025-03-31; filed 2025-06-30.
0001641172-25-017050
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-03-31; filed 2026-06-29.
0001493152-26-031055
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 104 previous paragraphs and 85 current paragraphs.
34 unchanged; 29 reworded; 22 added; 41 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 5 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (22)
Current report
We provide business consulting and coordination services to customers seeking overseas wealth planning, insurance-related information and related cross-border service support. Our services primarily include customer consultation, appointment coordination, referral and liaison with third-party insurance brokers or other service providers, and related administrative support. We conduct our consulting service business through our wholly owned subsidiary, Yingxi HK, which is located in Hong Kong, China.
Current report
On March 30, 2026, we completed the acquisition of KMFG, a Nevada corporation with headquarters in Shenzhen, China. KMFG operates two core business segments: (i) an apparel and garment trading business focused on the wholesale distribution of men’s and women’s apparel to distributors primarily in China, sourcing directly from manufacturers without maintaining its own production facilities; and (ii) a digital publishing business conducted through its wholly owned subsidiary, GW Reader Sdn. Bhd. in Malaysia, which operates a mobile-based online fiction platform utilizing a pay-per-chapter microtransaction model for global readers. As of March 31, 2026, KMFG’s revenue contribution was not significant, and management does not currently present KMFG as a separate business line or reportable segment. Management will continue to monitor KMFG’s operations, revenue contribution and business development and will reassess the related disclosure and segment presentation as necessary in future periods.
Current report
Dispositions of Subsidiaries and Discontinued Operations
Current report
During the fiscal year ended March 31, 2026, we disposed of Dongguan Aotesi Garments Co., Ltd., a PRC company (“AOT”), and Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”). AOT was previously engaged in the garment manufacturing business and was disposed of to the local management of AOT on May 6, 2025. After the disposition, AOT became a third party to the Company. The Company carries on the garment manufacturing business through its remaining subsidiaries, and the disposition of AOT did not qualify as discontinued operations. HX was previously engaged in the property management and subleasing business and was disposed of to the local management of HX on July 1, 2025. After the disposition, HX became a third party to the Company. Following the disposition, the Company no longer conducts the property management and subleasing business through HX or any other subsidiary. The property management and subleasing business has been classified as discontinued operations in the Company’s consolidated financial statements. AOT and HX were no longer subsidiaries of the Company as of March 31, 2026 and as of the date of this annual report.
Current report
The business objective of our consulting service line is to provide advisory, referral, coordination and administrative support services in connection with overseas insurance configuration, wealth management planning, identity planning, education planning and related cross-border service needs. We intend to develop this business as an asset-light service business with an emphasis on high-value consulting services, digital tools and private-domain customer management.
Current report
Management expects relatively stronger customer activity during June to September, October to December, holidays and weekends, while January to March is generally expected to be a traditional slower season due to the Chinese New Year period. Actual seasonality may vary based on customer demand, market conditions, regulatory developments and the availability of third-party service providers.
Current report
For consulting services, the credit period is generally 30 to 60 days, depending on the service arrangement, customer relationship, settlement cycle with third-party service providers and internal credit review. We do not directly collect customer insurance premiums. Premiums must be paid by customers directly to the relevant insurance company’s designated bank account or official payment gateway.
Current report
Critical Accounting Estimates
Current report
The preparation of our consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures in the consolidated financial statements and accompanying notes. Management evaluates its estimates on an ongoing basis based on historical experience, current conditions and other assumptions that management believes are reasonable under the circumstances. Actual results could differ from those estimates.
Current report
Management believes that the following accounting estimates involve a significant level of judgment or estimation uncertainty and are important to an understanding of our financial condition and results of operations. Management has discussed significant audit matters, including accounting estimates and related financial statement disclosures, with the Audit Committee in connection with the annual audit process.
Current report
Goodwill and Impairment Assessment
Current report
As a result of the acquisition of KMFG during the fiscal year ended March 31, 2026, the Company recognized goodwill in its consolidated financial statements. Goodwill represents the excess of the purchase consideration over the estimated fair value of identifiable net assets acquired and liabilities assumed in a business combination. The determination of goodwill requires management to make judgments and assumptions regarding the fair value of assets acquired and liabilities assumed, including assumptions related to future cash flows, discount rates, useful lives, market conditions and other valuation inputs.
Current report
The Company evaluates goodwill for impairment at least annually, and more frequently if events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable. The impairment assessment requires management to make estimates and assumptions regarding future operating results, cash flows, discount rates, market conditions and the Company’s ability to execute its business plans. If actual results are lower than management’s expectations, or if there are adverse changes in business, market or economic conditions, the Company may be required to recognize impairment charges, which could materially affect the Company’s results of operations and financial condition.
Current report
Going Concern Assessment
Current report
The Company has incurred net losses and has used cash in operating activities. Management evaluates whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the consolidated financial statements are issued. This assessment requires management to consider the Company’s liquidity, working capital, operating results, cash flows, debt obligations, available financing sources and management’s plans to mitigate adverse conditions.
Current report
Management’s going concern assessment involves significant judgment, including assumptions regarding the Company’s ability to improve operating results, manage operating costs, collect receivables, obtain additional financing if necessary, and execute its business plans. Changes in these assumptions or the Company’s ability to execute its plans could affect management’s going concern assessment and related disclosures.
Current report
Total revenue for the year ended March 31, 2026 significantly increased by approximately $1.2 million, or approximately 28.6%, as compared with the year ended March 31, 2025. The increase was mainly due to revenue generated from the newly established business segment of consulting services.
Current report
Revenue generated from our newly established business segment of consulting service contributed approximately $2.2 million, or 40.1% of our total revenue for the year ended March 31, 2026.
Current report
For consulting service business, the cost of revenue was mainly attributable to referral fees, channel service fees and other service fulfillment costs paid or payable to third-party referral partners and cooperating service providers. The cost of revenue for consulting service for the year ended March 31, 2026 was $2.1 million, representing approximately 99.3% of total consulting service revenue.
Current report
Gross profit of our consulting service business for the year ended March 31, 2026 was $14,794, and gross profit ratio was approximately 0.7%. Cost of revenue for consulting service represented approximately 99.3% of consulting service revenue for the year ended March 31, 2026. The relatively low gross profit ratio was primarily due to referral fees, channel service fees and other service fulfillment costs paid or payable to third-party referral partners and cooperating service providers in connection with the Company’s consulting service arrangements during the initial stage of operation of the consulting service business.
Current report
Net Loss
Current report
Net cash used in investing activities increased by approximately $0.1 million for the year ended March 31, 2026, compared to the year ended March 31, 2025. The increase was mainly due to the net effect of the disposals of AOT and HX, including cash deconsolidated upon the disposals, partially offset by the reduction of investing cash outflows from the disposed subsidiaries after the disposal dates and cash acquired from KMFG upon acquisition.
Removed paragraphs (41)
Previous report
Unless the context otherwise requires, all references in this Form 10-K to “Addentax” refer to Addentax Group Corp., a holding company, and references to “we,” “us,” “our,” the “Registrant,” the “Company,” or “our company” refer to Addentax and/or its consolidated subsidiaries. Addentax Group Corp., our Nevada holding company, is the entity in which our investors are investing.
Previous report
Our subsidiaries include (i) Yingxi Industrial Chain Group Co., Ltd., a Republic of Seychelles company; (ii) Yingxi Industrial Chain Investment Co., Ltd., a Hong Kong company (“Yingxi HK”); (iii) Qianhai Yingxi Textile & Garments Co., Ltd., a PRC company; (iv) Shenzhen Qianhai Yingxi Industrial Chain Services Co., Ltd, a PRC company (“YX”), (v) Dongguan Heng Sheng Wei Garments Co., Ltd, a PRC company (“HSW”), (vi) Dongguan Yushang Clothing Co., Ltd, a PRC company (“YS”), (vii) Shenzhen Yingxi Peng Fa Logistic Co., Ltd., a PRC company (“PF”); (viii) Shenzhen Xin Kuai Jie Transportation Co., Ltd, a PRC company (“XKJ”), (ix) Dongguan Aotesi Garments Co., Ltd.,, a PRC company (“AOT”), (x) Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”).
Previous report
“PRC Subsidiaries” refers to, collectively, (i) Qianhai Yingxi Textile & Garments Co., Ltd.; (ii) Shenzhen Qianhai Yingxi Industrial Chain Services Co., Ltd (“YX”), (iii) Dongguan Heng Sheng Wei Garments Co., Ltd (“HSW”), (iv) Dongguan Yushang Clothing Co., Ltd (“YS”); (v) Shenzhen Yingxi Peng Fa Logistic Co., Ltd., a PRC company (“PF”); (vi) Shenzhen Xin Kuai Jie Transportation Co., Ltd, a PRC company (“XKJ”), (vii) Dongguan Aotesi Garments Co., Ltd.,, a PRC company (“AOT”), (viii) Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”).
Previous report
“WFOE” refers to Qianhai Yingxi Textile & Garments Co., Ltd, a wholly foreign owned enterprise in China, which is indirectly wholly owned by Addentax Group Corp.
Previous report
Our property management and subleasing business provides shops subleasing and property management services for garment wholesalers and retailers in the garment market. business provides shops subleasing and property management services for garment wholesalers and retailers in the garment market. We conduct our property management and subleasing operation through a wholly owned subsidiary acquired in September 2023, namely Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”), which is located in the Guangdong province, China.
Previous report
Logistics Services Business
Previous report
Property Management and Subleasing Business
Previous report
The business objective of our property management and subleasing segment is to integrate resources in shopping mall, develop e-commerce bases and the Internet celebrity economy together to drive to increase the value of the stores in the area. We conduct the business through a wholly owned subsidiary acquired in September 2023, namely Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”).
Previous report
Logistics Services Business
Previous report
Property Management and Subleasing Business
Previous report
There is no significant seasonality in our business.
Previous report
Logistics Services business
Previous report
Property management and subleasing business
Previous report
For property management and subleasing business, we generally collect rental and management fees of the following month each month in advance.
Previous report
Summary of Critical Accounting Policies
Previous report
We have identified critical accounting policies that, as a result of judgments, uncertainties, uniqueness and complexities of the underlying accounting standards and operation involved could result in material changes to our financial position or results of operations under different conditions or using different assumptions.
Previous report
Estimates and Assumptions
Previous report
We regularly evaluate the accounting estimates that we use to prepare our financial statements. In general, management’s estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.
Previous report
Revenue Recognition
Previous report
Revenue is generated through sale of goods and delivery services. Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods and services. The Company applies the following five-step model in order to determine this amount:
Previous report
The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company’s performance obligations are transferred to customers at a point in time, typically upon delivery.
Previous report
For all reporting periods, the Company has not disclosed the value of unsatisfied performance obligations for all product and service revenue contracts with an original expected length of one year or less, which is an optional exemption that is permitted under the adopted rules.
Previous report
Leases
Previous report
Lessee
Previous report
The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities, and operating lease liabilities in our consolidated balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in the consolidated balance sheets.
Previous report
ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the leases do not provide an implicit rate, The Company generally use the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.
Previous report
Lessor
Previous report
As a lessor, the Company’s leases are classified as operating leases under ASC 842. Leases, in which the Company is the lessor, are substantially all accounted for as operating leases and the lease components and non-lease components are accounted for separately. Rental income from operating leases is recognized on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognized on a straight-line basis over the lease term.
Previous report
Accounts receivable, net
Previous report
Accounts receivable, net are stated at the historical carrying amount net of allowance for doubtful accounts.
Previous report
Account receivables are classified as financial assets subsequently measured at amortized cost. Account receivables are recognized when the Company becomes a party to the contractual provisions of the receivables. They are measured, at initial recognition, at fair value plus transaction costs, if any and are subsequently measured at amortized cost. The amortized cost is the amount recognized on the receivable initially, minus principal repayments, plus cumulative amortization (interest) using the effective interest method of any difference between the initial amount and the maturity amount, adjusted for any loss allowance.
Previous report
A loss allowance for expected credit losses is recognized on account receivables and is updated at each reporting date. The Company determines the expected credit losses provisions based on ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (‘‘ASC 326’’) using a modified retrospective approach which did not have a material impact on the opening balance of accumulated deficit. To determine expected credit losses on account receivables, the Company will consider the historic credit loss experience, adjusted for factors that are specific to the debtors, general economic conditions, and an assessment of both the current and forecasted direction of conditions at the reporting date, including the time value of money, where appropriate.
Previous report
The loss allowance is calculated on a collective basis for all trade and other receivables in totality. An impairment gain or loss is recognized in profit or loss with a corresponding adjustment to the carrying amount of account receivables, through use of a loss allowance account. The impairment loss is included in operating expenses as a movement in credit loss allowance.
Previous report
Receivables are written off when there is information indicating that the counterparty is in severe financial difficulty and there is no realistic prospect of recovery, e.g., when the counterparty has been placed under liquidation or has entered into bankruptcy proceedings. Receivables written off may still be subject to enforcement activities under the Company’s recovery procedures, considering legal advice where appropriate. Any recoveries made are recognized in profit or loss.
Previous report
Recently issued and adopted accounting pronouncements
Previous report
Accounting for Convertible Instruments: In August 2020, FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (ASU 2020-06), as part of its overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. Among other changes, the new guidance removes from GAAP separation models for convertible debt that require the convertible debt to be separated into a debt and equity component, unless the conversion feature is required to be bifurcated and accounted for as a derivative or the debt is issued at a substantial premium. As a result, after adopting the guidance, entities will no longer separately present such embedded conversion features in equity and will instead account for the convertible debt wholly as debt. The new guidance also requires use of the “if-converted” method when calculating the dilutive impact of convertible debt on earnings per share, which is consistent with the Company’s current accounting treatment under the current guidance. The guidance is effective for financial statements issued for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years, with early adoption permitted, but only at the beginning of the fiscal year.
Previous report
The Company reviews new accounting standards as issued. Management has not identified any other new standards that it believes will have a significant impact on the Company’s consolidated financial statements.
Previous report
Total revenue for the year ended March 31, 2025 significantly decreased by approximately $1.0 million, or approximately 18.9%, as compared with the year ended March 31, 2024. The decrease was mainly due to the decrease of revenue from the logistics services business.
Previous report
Net Profit
Previous report
Net cash used in investing activities for the year ended March 31, 2025 was approximately $0.3 million more than cash used in investing activities for the year ended March 31, 2024. It was mainly because in the year ended March 31, 2024, there was $0.2 million cash from newly acquired subsidiary.
Showing the first 40 of 41 passages. Open the source sections for the rest.
Reworded paragraphs (29)
Previous wording
We (Addentax Group Corp.) are a Nevada holding company with no material operations of our own. We conduct substantially all of our operations through our operating companies established in the PRC, primarily YX, our wholly owned subsidiary and its subsidiaries. We are not a Chinese operating company. We are a holding company and do not directly own any substantive business operations in China. Therefore, our investors will not directly hold any equity interests in our operating companies. Our holding company structure involves unique risks to investors. Chinese regulatory authorities could disallow our operating structure, which would likely result in a material change in our operations and/or the value of our common stock, including that it could cause the value of such securities to significantly decline or become worthless. Our holding company, Addentax Group Corp., is listed on the Nasdaq Capital Market under the symbol of “ATXG”. We classify our businesses into three main segments: garment manufacturing, logistics services, and property management and subleasing.
Current wording
We are a Nevada holding company with no material operations of our own. We conduct substantially all of our operations through our operating companies established in the PRC, primarily YX, our wholly-owned subsidiary and its subsidiaries. We are not a Chinese operating company. We are a holding company and do not directly own any substantive business operations in China. Therefore, our investors will not directly hold any equity interests in our operating companies. Our holding company structure involves unique risks to investors. Chinese regulatory authorities could disallow our operating structure, which would likely result in a material change in our operations and/or the value of our Common Stock, including that it could cause the value of such securities to significantly decline or become worthless. Our holding company, Addentax Group Corp., is listed on the Nasdaq Capital Market under the symbol of “ATXG”. During the fiscal year ended March 31, 2026, our continuing operations primarily consisted of garment manufacturing, logistics services and consulting services.
Previous wording
Our garment manufacturing business consists of sales made principally to wholesalers located in the PRC. We have our own manufacturing facilities, with sufficient production capacity and skilled workers on production lines to ensure that we meet our high quality control standards and timely meet the delivery requirements for our customers. We conduct our garment manufacturing operations through five wholly owned subsidiaries, namely Dongguan Heng Sheng Wei Garments Co., Ltd (“HSW”), Dongguan Yushang Clothing Co., Ltd (“YS”)and Dongguan Aotesi Garments Co., Ltd., (“AOT”), which are located in the Guangdong province, China.
Current wording
Our garment manufacturing business consists of sales made principally to wholesalers located in the PRC. We have our own manufacturing facilities, with sufficient production capacity and skilled workers on production lines to ensure that we meet our high quality control standards and delivery requirements for our customers. We conduct our garment manufacturing operations through three wholly-owned subsidiaries, namely YX and YS, which are located in Guangdong province, China.
Previous wording
Our logistics business consists of delivery and courier services covering 44 cities in 10 provinces and 2 municipalities in China. Although we have our own motor vehicles and drivers, we currently outsource some of the business to our contractors. We believe outsourcing allows us to maximize our capacity and maintain flexibility while reducing capital expenditures and the costs of keeping drivers during slow seasons. We conduct our logistic operations through three wholly owned subsidiaries, namely Shenzhen Xin Kuai Jie Transportation Co., Ltd (“XKJ”) and Shenzhen Yingxi Peng Fa Logistic Co., Ltd (“PF”) which are located in the Guangdong province, China.
Current wording
Our logistics business consists of delivery and courier services covering 45 cities in 10 provinces and 2 municipalities in China. Although we have our own motor vehicles and drivers, we currently outsource some of the business to our contractors. We believe outsourcing allows us to maximize our capacity and maintain flexibility while reducing capital expenditures and the costs of keeping drivers during slow seasons. We conduct our logistic operations through two wholly-owned subsidiaries, namely XKJ and PF, which are located in Guangdong province, China.
Previous wording
The business objective and future plan for our logistics services segment is to establish an efficient logistics system and to build a nationwide delivery and courier network in China. As of March 31, 2025, we provide logistics services to over 44 cities in approximately 10 provinces and 2 municipalities. We expect to develop 20 additional logistics routes in existing serving cities and improve the Company’s profit in the year 2025.
Current wording
The business objective and future plan for our logistics services segment is to establish an efficient logistics system and to build a nationwide delivery and courier network in China. As of March 31, 2026, we provided logistics services to over 45 cities in approximately 10 provinces and 2 municipalities. We expect to develop 20 additional logistics routes in existing serving cities and improve the Company’s profit in the year 2026.
Previous wording
Revenue generated from our garment manufacturing business contributed approximately $0.3 million, or approximately 6.8%, of our total revenue for the year ended March 31, 2025. Revenue generated from the segment contributed approximately $0.2 million, or approximately 4.5%, of our total revenue for the year ended March 31, 2024. The low amount of sales was mainly due to insufficient customer volume, we cannot receive as large order quantity from remaining customers as before while new developed customer still at the start stage.
Current wording
Revenue generated from our garment manufacturing business contributed approximately $0.04 million, or approximately 0.8%, of our total revenue for the year ended March 31, 2026. Revenue generated from the segment contributed approximately $0.3 million, or approximately 6.8%, of our total revenue for the year ended March 31, 2025. The relatively low level of sales was mainly due to insufficient customer base. In addition, order volumes from the remaining customers were lower than in prior periods, while newly developed customers remained in the early stages of business development and had not yet generated significant sales.
Previous wording
Revenue generated from our logistics services business contributed approximately $3.0 million, or approximately 72.2%, of our total revenue for the year ended March 31, 2025. Revenue generated from the segment contributed approximately $4.3 million, or approximately 84.3%, of our total revenue for the year ended March 31, 2024. The decrease of approximately $1.3 million was mainly due to market volatility.
Current wording
Revenue generated from our logistics services business contributed approximately $3.2 million, or approximately 59.1%, of our total revenue for the year ended March 31, 2026. Revenue generated from the segment contributed approximately $3.0 million, or approximately 72.2%, of our total revenue for the year ended March 31, 2025. The increase of approximately $0.2 million was mainly due to market volatility.
Previous wording
Revenue generated from our property management and subleasing business contributed approximately $0.9 million, or approximately 21.0%, of our total revenue for the year ended March 31, 2025. Revenue generated from our property management and subleasing business contributed approximately $0.6 million, or approximately 11.3%, of our total revenue for the year ended March 31, 2024. The increase of approximately $0.3 million was mainly due to improved rental rate.
Current wording
Revenue generated from our property management and subleasing business was Nil for the year ended March 31, 2026. The segment was disposed of on July 1, 2025. The revenue from this segment before disposal has been reclassified as discontinued operations. Revenue generated from our property management and subleasing business contributed approximately $0.9 million, or approximately 21.0%, of our total revenue for the year ended March 31, 2025.
Previous wording
Raw materials cost for our garment manufacturing business was approximately 49.6% of our total garment manufacturing business revenue in the year ended March 31, 2025, as compared with approximately 14.6% in the year ended March 31, 2024. The increase in raw materials cost for our garment manufacturing business was mainly due to increase of manufacturing during the year.
Current wording
Raw materials cost for our garment manufacturing business was approximately 49.5% of our total garment manufacturing business revenue in the year ended March 31, 2026, as compared with approximately 49.6% in the year ended March 31, 2025. The decrease in percentage was mainly due to a reduction in the costs of the raw materials. This decrease was driven by our shift to purchasing finished garments amid lower order volumes during the year ended March 31, 2026. At smaller scale, direct sourcing is more cost-efficient than in-house manufacturing. Additionally, our small-batch, diversified product mix resulted in lower average unit costs, which reduced the overall ratio.
Previous wording
Labor costs for our garment manufacturing business were approximately 25.5% of our total garment manufacturing business revenue in the year ended March 31, 2025, as compared with 56.7% in the year ended March 31, 2024. The decrease in labor costs for our garment manufacturing business was mainly due to the decrease of sub-contracting business in AOT.
Current wording
Labor costs for our garment manufacturing business were approximately 20.0% of our total garment manufacturing business revenue in the year ended March 31, 2026, as compared with 25.5% in the year ended March 31, 2025. We maintained a sustainable level in wages. The decrease in portion of labor cost against revenue was mainly due to the decrease in revenue.
Previous wording
Overhead and other expenses for our garment manufacturing business accounted for approximately 5.8% and 1.0% of our total garment manufacturing business revenue for the years ended March 31, 2025 and 2024, respectively.
Current wording
Overhead and other expenses for our garment manufacturing business accounted for approximately 3.0% and 5.8% of our total garment manufacturing business revenue for the years ended March 31, 2026 and 2025, respectively.
Previous wording
For our logistic services business, we outsource some of the business to our subcontractors. Our subcontractors are contract logistic service providers. The Company relied on a few subcontractors, which the subcontracting fees to our largest contractor represented approximately 5.2% and 42.0% of total cost of revenues for our logistics services segment for the years ended March 31, 2025 and 2024, respectively. The decrease in subcontracting fee to the largest contractor was mainly to decrease use of subcontractors. We have not experienced any disputes with our subcontractors and we believe we maintain good relationships with our contract logistic service provider.
Current wording
For our logistic services business, we outsource some of the business to our subcontractors. Our subcontractors are contract logistic service providers. The Company relied on a few subcontractors, which the subcontracting fees to our largest contractor represented approximately 7.2% and 5.2% of total cost of revenues for our logistics services segment for the years ended March 31, 2026 and 2025, respectively. The increase in subcontracting fees paid to the largest contractor was mainly due to the Company’s increased utilization of subcontractors. We have not experienced any disputes with our subcontractors and we believe we maintain good relationships with our contract logistic service provider.
Previous wording
Fuel, toll and other costs for our logistics business for the year ended March 31, 2025 was approximately $1.8 million, as compared with $1.9 million for the year ended March 31, 2024. Fuel, toll and other costs for our logistics business accounted for approximately 59.7% of our total service revenue for the year ended March 31, 2025, as compared with approximately 43.3% for the year ended March 31, 2024.
Current wording
Fuel, toll and other costs for our logistics business for the year ended March 31, 2026 was approximately $2.2 million, as compared with $1.8 million for the year ended March 31, 2025. Fuel, toll and other costs for our logistics business accounted for approximately 67.9% of our total service revenue for the year ended March 31, 2026, as compared with approximately 59.7% for the year ended March 31, 2025.
Previous wording
Subcontracting fees for our logistics business for the year ended March 31, 2025 decreased to approximately $0.2 million from $1.5 million for the year ended March 31, 2024, representing an decrease of approximately 89.0%. Subcontracting fees accounted for 5.5% and 34.9% of our total logistics business revenue in the years ended March 31, 2025 and 2024, respectively.
Current wording
Subcontracting fees for our logistics business for the year ended March 31, 2026 increased to approximately $0.3 million from $0.2 million for the year ended March 31, 2025, representing an increase of approximately 72.3%. Subcontracting fees accounted for 9.0% and 5.5% of our total logistics business revenue in the years ended March 31, 2026 and 2025, respectively.
Previous wording
For property management and subleasing business, the cost of revenue was mainly the amortization of operating lease assets for the subleasing business. The cost of revenue for property management and subleasing business for the year ended March 31, 2025 was $1.3 million, approximately 153.5% of our total property management and subleasing business revenue, as compared with $0.5 million, approximately 81.4% of total property management and subleasing business revenue for the year ended March 31, 2024.
Current wording
For property management and subleasing business, the cost of revenue was mainly the amortization of operating lease assets for the subleasing business. The cost of revenue for property management and subleasing business for the year ended March 31, 2026 was $Nil as the business segment was disposed of on July 1, 2025. The revenue from this segment has been reclassified as discontinued operations. As compared, the revenue was $1.3 million, approximately 153.5% of total property management and subleasing business revenue for the year ended March 31, 2025.
Previous wording
Gross profit of garment manufacturing business for the year ended March 31, 2025 was approximately $53,879, as compared with approximately $63,544 for the year ended March 31, 2024. Gross profit ratio was approximately 19.0% of revenue of the segment, as compared with approximately 27.7% for the year ended March 31, 2024.
Current wording
Gross profit of garment manufacturing business for the year ended March 31, 2026 was approximately $11,260, as compared with approximately $53,879 for the year ended March 31, 2025. Gross profit ratio was approximately 27.5% of revenue of the segment, as compared with approximately 19.0% for the year ended March 31, 2025.
Previous wording
Gross profit of our logistics services business for the year ended March 31, 2025 was approximately $1.1 million and gross profit ratio was approximately 34.8%. Gross profit of the segment for the year ended March 31, 2024 was approximately $0.9 million and gross profit ratio was approximately 21.8%. The increase in the gross profit ratio was mainly because less subcontractor used
Current wording
Gross profit of our logistics services business for the year ended March 31, 2026 was approximately $0.7 million and gross profit ratio was approximately 23.0%. Gross profit of the segment for the year ended March 31, 2025 was approximately $1.1 million and gross profit ratio was approximately 34.8%. The decrease in gross profit ratio was mainly due to a combination of cost and market factors: significantly higher toll expenses; and a competitive “low-margin, high-volume” pricing strategy adopted to maintain market share amid intense economic competition, despite year-over-year revenue growth in the 2026 period.
Previous wording
Gross loss of our property management and subleasing business for the year ended March 31, 2025 was approximately $0.5 million, representing approximately (53.5)% of our total property management and subleasing business revenue. Gross profit in our property management and subleasing business for the year ended March 31, 2024 was $0.1 million, or 18.6% of our total property management and subleasing business revenue.
Current wording
Gross profit of our property management and subleasing business for the year ended March 31, 2026 was reclassified to discontinued operations as it was disposed of on July 1, 2025. Gross loss in our property management and subleasing business for the year ended March 31, 2025 was $0.5 million, or (53.5)% of our total property management and subleasing business revenue.
Previous wording
Our selling expenses were mainly incurred for our property management and subleasing business. It was $264,270 for property management and subleasing business and $128,956 for garments manufacturing business for the year ended March 31, 2025. It was approximately $83,987 for property management and subleasing business and $46,617 for garments manufacturing business for the year ended March 31, 2024. Selling expenses consist primarily of local transportation, unloading charges and product inspection charges.
Current wording
Our selling expenses were mainly incurred for our garments manufacturing business. It was $23,729 for garments manufacturing business for the year ended March 31, 2026. It was approximately $264,270 for property management and subleasing business and $128,956 for garments manufacturing business for the year ended March 31, 2025. Selling expenses consist primarily of local transportation, unloading charges and product inspection charges.
Previous wording
Our general and administrative expenses in our garment manufacturing segment for the years ended March 31, 2025 and 2024 were approximately $25,638 and $160,800, respectively. Our general and administrative expenses in our logistics services segment for the year ended March 31, 2025 and 2024 was approximately $800,820 and $766,960, respectively. The general and administrative expenses in our property management and subleasing business were approximately $220,021 and $310,134 for the years ended March 31, 2025 and 2024. Our general and administrative expenses in our corporate office for the years ended March 31, 2025 and 2024 were approximately $1,011,522 and $961,771, respectively. General and administrative expenses consist primarily of administrative salaries, office expense, certain depreciation and amortization charges, repairs and maintenance, legal and professional fees, warehousing costs and other expenses that are not directly attributable to our revenues.
Current wording
Our general and administrative expenses in our garment manufacturing segment for the years ended March 31, 2026 and 2025 were approximately $35,991 and $25,638, respectively. Our general and administrative expenses in our logistics services segment for the year ended March 31, 2026 and 2025 was approximately $695,013 and $800,820, respectively. The general and administrative expenses in our consulting business were approximately $81,228 and $Nil for the years ended March 31, 2026 and 2025. Our general and administrative expenses in our corporate office for the years ended March 31, 2026 and 2025 were approximately $1,449,880 and $1,011,522, respectively. General and administrative expenses consist primarily of administrative salaries, office expense, certain depreciation and amortization charges, repairs and maintenance, legal and professional fees, warehousing costs and other expenses that are not directly attributable to our revenues.
Previous wording
Total general and administrative expenses for the year ended March 31, 2025 decreased approximately 2.7% to approximately $2.06 million from approximately $2.12 million for the year ended March 31, 2024.
Current wording
Total general and administrative expenses for the year ended March 31, 2026 increased approximately 9.9% to approximately $2.26 million from approximately $2.06 million for the year ended March 31, 2025.
Previous wording
Loss from operations for the years ended March 31, 2025 and 2024 was approximately $1.8 million and $1.1 million, respectively. Loss from operations of approximately $100,715 and $143,872 was attributed from our garment manufacturing segment for the years ended March 31, 2025 and 2024, respectively. Income from operations of approximately $249,160 and $179,450 was attributed from our logistics services segment for the years ended March 31, 2025 and 2024, respectively. Loss from operations of $954,448 and $201,746 was attributed from our property management and subleasing business for the years ended March 31, 2025 and 2024. We incurred general and administrative expenses in corporate office of approximately $1,010,967 and approximately $965,028 for the years ended March 31, 2025 and 2024, respectively.
Current wording
Loss from operations for the years ended March 31, 2026 and 2025 was approximately $1.5 million and $1.8 million, respectively. Loss from operations of approximately $48,459 and $100,715 was attributed from our garment manufacturing segment for the years ended March 31, 2026 and 2025, respectively. Income from operations of approximately $35,833 and $249,160 was attributed from our logistics services segment for the years ended March 31, 2065 and 2025, respectively. Loss from operations of $66,434 was attributed from our consulting business for the years ended March 31, 2026. Loss from operations from our corporate office for the years ended March 31, 2026 and 2026 was $1,449,880 and $1,010,967, respectively.
Previous wording
Income tax expense for the years ended March 31, 2025 and 2024 was $4,649 and $11,605, respectively. The Company operates in the PRC and files tax returns in the PRC jurisdictions.
Current wording
Income tax expense for the years ended March 31, 2026 and 2025 was $4,106 and $4,649, respectively. The Company operates in the PRC and files tax returns in the PRC jurisdictions.
Previous wording
Yingxi Industrial Chain Group Co., Ltd was incorporated in the Republic of Seychelles and, under the current laws of the British Virgin Islands, is not subject to income taxes.
Current wording
YICG was incorporated in the Republic of Seychelles and, under the current laws of Seychelles, is not subject to income taxes.
Previous wording
Yingxi’s operating companies are governed by the Income Tax Laws of the PRC and subject to progressive EIT rate from 5% to 15% in year ended March 31, 2025. The preferential tax rates will be expired at the end of year 2025. Income taxes of the PRC companies were $4,649 and $11,605 for the year ended March 31, 2025 and 2024, respectively.
Current wording
PRC operating companies are governed by the Income Tax Laws of the PRC and subject to progressive EIT rate from 5% to 15% in year ended March 31, 2026. The preferential tax rates will be expired at the end of year 2026. Income taxes of the PRC companies were $4,106 and $4,649 for the year ended March 31, 2026 and 2025, respectively.
Previous wording
We incurred a net loss of approximately $5.1 million and a net loss of approximately $3.1 million for the years ended March 31, 2025 and 2024, respectively. Our basic and diluted loss per share were $0.85 and $0.71 for the year ended March 31, 2025 and 2024, respectively.
Current wording
We incurred a net loss of approximately $4.0 million and a net loss of approximately $5.1 million for the years ended March 31, 2026 and 2025, respectively. Our basic and diluted loss per share were $5.55 and $12.75 for the year ended March 31, 2026 and 2025, respectively.
Previous wording
Net cash provided by operating activities in the year ended March 31, 2025 increased by approximately $1.1 million compared with that of the year ended March 31, 2024. It was mainly because the net loss adjusted to cash used in operating activities of fiscal year ended March 31, 2025 was approximately $0.6 million less than the amount of the fiscal year ended March 31, 2024. The movement of operating assets and liabilities of the year ended March 31, 2025 resulted in cash inflow of approximately $0.8 million compared to cash inflow of approximately $0.3 million in the movement of operating assets and liabilities of the year ended March 31, 2024. We aim to improve our operating cash flow by closely monitoring the timely collection of accounts and other receivables. We generally do not hold any significant inventory for more than ninety days, as we typically manufacture upon customers’ order.
Current wording
Net cash provided by operating activities in the year ended March 31, 2026 decreased by approximately $1.4 million compared with that of the year ended March 31, 2025. It was mainly because the net loss adjusted to cash used in operating activities of fiscal year ended March 31, 2026 was approximately $0.2 million less than the amount of the fiscal year ended March 31, 2025. The movement of operating assets and liabilities of the year ended March 31, 2026 resulted in cash outflow of approximately $0.4 million compared to cash inflow of approximately $0.8 million in the movement of operating assets and liabilities for the year ended March 31, 2025. We aim to improve our operating cash flow by closely monitoring the timely collection of accounts and other receivables. We generally do not hold any significant inventory for more than ninety days, as we typically manufacture upon customers’ order.
Previous wording
Net cash used in financing activities for the year ended March 31, 2025 was approximately $1.6 million more than the year ended March 31, 2024. In the year ended March 31 2025, the Company had receipt the proceeds of $0.6 million from issuance of Common Stock, payment of $0.5 million for redemption of convertible debt, net cash advance of $1.4 million to related parties and net cash from bank loans of $0.2 million. During the year ended March 31, 2024, the Company had receipt of $4.5 million cash released from restricted cash, net cash inflow of $0.3 million from bank loans, payment of $0.4 million of issuance cost of convertible debts, and net cash advance to related parties of $3.9 million.
Current wording
Net cash provided by financing activities increased by approximately $2.2 million for the year ended March 31, 2026 compared to the year ended March 31, 2025. In the year ended March 31 2026, the Company paid $1.2 million net cash advance to related parties, paid $0.4 million for redemption of convertible debt, and received cash of $2.7 million from released restricted cash. In the year ended March 31 2025, the Company received the proceeds of $0.6 million from issuance of Common Stock, payment of $0.5 million for redemption of convertible debt, net cash advance of $1.4 million to related parties and net cash from bank loans of $0.2 million.
Previous wording
As of March 31, 2025, we had cash on hand of approximately $0.3 million and restricted cash of approximately $2.8 million, total current assets of approximately $29.8 million and current liabilities of approximately $4.0 million. We presently finance our operations primarily from cash flows from revenue, fund raising from our IPO proceeds and capital contributions from our chief executive officer, Mr. Hong Zhida (the “CEO”).
Current wording
As of March 31, 2026, we had cash on hand of approximately $0.6 million and restricted cash of approximately $0.01 million, total current assets of approximately $23.0 million and current liabilities of approximately $3.0 million. We presently finance our operations primarily through cash flows from revenue, existing cash resources, capital contributions or financial support from our chief executive officer, Mr. Hong Zhida, and, if necessary, potential future financing activities, including equity financing, debt financing, private placements or other financing arrangements. There can be no assurance that additional financing will be available to us on commercially acceptable terms, or at all.
Previous wording
Our operations are located in the mainland China, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility in foreign exchange rates between the U.S. dollar and the Chinese Renminbi (“RMB”). All of our sales are in RMB. In last year, RMB depreciated against the U.S. dollar. As of March 31, 2025, the market foreign exchange rate had decreased to RMB7.26 to one U.S. dollar. Our financial statements are translated into U.S. dollars using the closing rate method. The balance sheet items are translated into U.S. dollars using the exchange rates at the respective balance sheet dates. The capital and various reserves are translated at historical exchange rates prevailing at the time of the transactions while income and expenses items are translated at the average exchange rate for the period. All translation adjustments are included in accumulated other comprehensive income in the statement of equity. The foreign currency translation gain for the years ended March 31, 2025 and 2024 was $48,135 and $82,490, respectively.
Current wording
Our operations are located in mainland China, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility in foreign exchange rates between the U.S. dollar and the Chinese Renminbi (“RMB”). All of our sales are in RMB. In last year, RMB depreciated against the U.S. dollar. As of March 31, 2026, the market foreign exchange rate had increased to RMB6.91 to one U.S. dollar. Our financial statements are translated into U.S. dollars using the closing rate method. The balance sheet items are translated into U.S. dollars using the exchange rates at the respective balance sheet dates. The capital and various reserves are translated at historical exchange rates prevailing at the time of the transactions while income and expenses items are translated at the average exchange rate for the period. All translation adjustments are included in accumulated other comprehensive income in the statement of equity. The foreign currency translation gain (loss) for the years ended March 31, 2026 and 2025 was $(171,577) and $48,134, respectively.