Skycorp Solar (PN) F-1/ARegistration statement (foreign) (amended)

As filed with the U.S. Securities and Exchange Commission on November 22, 2024

Registration No. 333-282996

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

_____________________________

Amendment No. 1 To
FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

_____________________________

Skycorp Solar Group Limited
(Exact name of Registrant as specified in its charter)

Not Applicable
(Translation of Registrant’s name into English)

_____________________________

Room 303, Block B, No.188 Jinghua Road, Yinzhou District,
Ningbo City, Zhejiang Province, China 315048
+86 0574 87966876
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

_____________________________

Cogency Global Inc.
122 East 42nd Street, 18th Floor
New York, NY 10168
+1 212 947-7200
(Name, address, including zip code, and telephone number, including area code, of agent for service)

_____________________________

Copies to:

_____________________________

Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.

Emerging growth company ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

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†         The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

2,700,000 Ordinary Shares

Skycorp Solar Group Limited

This is the initial public offering on a firm commitment basis of our ordinary shares, par value $0.0001 per share (“Ordinary Shares”). Prior to this offering, there has been no public market for our Ordinary Shares. We expect the initial public offering price to be in the range of $4.00 to $5.00 per Ordinary Share. We have applied to list our Ordinary Shares on the Nasdaq Capital Market (“Nasdaq”) under the symbol “PN.” We cannot guarantee that we will be successful in listing our Ordinary Shares on Nasdaq; however, we will not complete this offering unless we are so listed.

Throughout this prospectus, unless the context indicates otherwise, references to “we,” “us,” “our,” “Skycorp Cayman,” and “our Company,” refer to Skycorp Solar Group Limited, a Cayman Islands exempted company, and when describing Skycorp Cayman’s consolidated financial information for the fiscal years ended September 30, 2023 and 2022, also includes Skycorp Cayman’s subsidiaries. References to “PRC subsidiaries” are to Ningbo eZsolar Co., Ltd. (“Ningbo WFOE”), Guangzhou Skycorp Consulting Co., Ltd. (“Guangzhou WFOE”), and their subsidiaries. References to “operating subsidiaries” are to Ningbo Skycorp Solar Co., Ltd. (“Ningbo Skycorp”) and its subsidiaries.

Unless otherwise indicated, all share amounts and per share amounts in this prospectus have been presented giving effect to a forward split of our Ordinary Shares at a ratio of 1-for-10,000, with the Company’s authorized share capital remaining at $50,000, divided into 500,000,000 Ordinary Shares with a par value of $0.0001 and the surrender of 475,000,000 Ordinary Shares, all of which were approved by our shareholders and board of directors on October 21, 2024.

Skycorp Cayman is a Cayman Islands holding company, not a Chinese operating company. As a holding company with no material operations of its own, it conducts all of its operations and operates its business in China through Ningbo Skycorp and its subsidiaries. Because of our corporate structure as a Cayman Islands holding company with operations conducted by our PRC operating subsidiaries, it involves unique risks to investors. Furthermore, Chinese regulatory authorities could change the rules and regulations regarding foreign ownership in the industry in which our operating subsidiaries operate, which would likely result in a material change in the operating subsidiaries’ operations and/or the value of the securities we are registering for sale, including causing the value of such securities to significantly decline or become worthless. Investors in our Ordinary Shares should be aware that they do not directly hold equity interests in the Chinese operating subsidiaries but rather are purchasing equity interests solely in Skycorp Cayman, a Cayman Islands holding company, which indirectly owns equity interests in the PRC subsidiaries. Our Ordinary Shares offered in this offering are shares of our Cayman Islands holding company instead of shares of our subsidiaries in China. See “Risk Factors — Risks Related to Doing Business in China — We are required to fulfill the Trial Measures filing procedures and report relevant information to the CSRC; and, since the interpretation and implementation of the new regulations are still evolving, we cannot assure you that we will be able to complete the filings for this offering and any future offerings, and fully comply with the relevant new rules on a timely basis, if at all” on page 17.

We are both an “emerging growth company” and a “foreign private issuer” as defined under the U.S. federal securities laws and, as such, may elect to comply with certain reduced public company reporting requirements for this and future filings. See “Prospectus Summary — Implications of Being an Emerging Growth Company” and “Prospectus Summary — Implications of Being a Foreign Private Issuer” on page 14 for additional information.

Investing in our Ordinary Shares involves a high degree of risk. Before buying any Ordinary Shares, you should carefully read the discussion of material risks of investing in our Ordinary Shares in “Risk Factors” beginning on page 17 of this prospectus.

Because the Company conducts all of its operations in China through its operating subsidiaries, we are subject to certain legal and operational risks associated with the operations in China, including changes in the legal, political, and economic policies of the Chinese government, the relationship between China and United States, or Chinese or United States regulations may materially and adversely affect our business, financial condition and results of operations. The Chinese government may intervene or influence our operations at any time, or may exert more control over offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in our operating subsidiaries’ operations and/or the value of our Ordinary Shares or could 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 become worthless.

Recently, the PRC government initiated a series of regulatory actions and statements to regulate business operations in China, which may be changed from time to time, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using variable interest entity structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement.

In the opinion of our PRC counsel, Jiangsu Junjin Law Firm, we are not subject to cybersecurity review with the Cyberspace Administration of China, or the “CAC,” after the Measures for Cybersecurity Review (2021 version) became effective on February 15, 2022, since we currently do not have over one million users’ personal information and do not anticipate that we will be collecting over one million users’ personal information in the foreseeable future, which we understand might otherwise subject us to the Measures for Cybersecurity Review (2021 version); we are also not subject to network data security review by the CAC if the Draft Regulations on the Network Data Security Administration are enacted as proposed, since we currently do not have over one million users’ personal information and do not collect data that affects or may affect national security and we do not anticipate that we will be collecting over one million users’ personal information or data that affects or may affect national security in the foreseeable future, which we understand might otherwise subject us to the Data Security Administration Draft. See “Risk Factors — Risks Related to Doing Business in China — Recent greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, could adversely impact our business and our offering” on page 21. In addition, as of the date of this prospectus, our operating subsidiaries’ operations are conducted entirely in mainland China. Our Hong Kong subsidiary, GreenHash Limited, is an intermediate holding company with no business operation. However, since Hong Kong is a special administrative region of China, the legal and operational risks associated with operating in China also apply to operations in Hong Kong. See “Risk Factors — Risks Related to Doing Business in China — Our Hong Kong subsidiary is currently an intermediate holding company with no business operations. However, the PRC laws and regulations governing businesses in the PRC may also be applicable to our business operations in Hong Kong.”

As of the date of this prospectus, our Hong Kong subsidiary is currently an intermediate holding company with no business operations. However, the PRC laws and regulations governing businesses in the PRC may also be applicable to our business operations in Hong Kong. These laws are sometimes vague and uncertain, and as a result, the legal and operational risks of operating in China could extend to businesses operating in Hong Kong, including any future operations of our Hong Kong subsidiary.

We may become subject to a variety of PRC laws and regulations, such as those regarding privacy, data security, cybersecurity, and data protection, which may also apply to any future operations in Hong Kong. These laws and regulations are continuously evolving and developing, and the scope and interpretation of the laws that are or may be applicable to us are often uncertain and may be conflicting, particularly with respect to foreign laws. In particular, there are numerous laws and regulations regarding privacy and the collection, sharing, use, processing, disclosure, and protection of personal information and other user data. Such laws and regulations often vary in scope, may be subject to differing interpretations, and may be inconsistent among different jurisdictions.

The national laws adopted by the PRC are generally not applicable to Hong Kong according to the Basic Law of the Hong Kong Special Administrative Region (the “Basic Law”), which came into effect on July 1, 1997. The Basic Law is the constitutional document of Hong Kong, as it sets out the PRC’s basic policies regarding Hong Kong. The principle of “one country, two systems,” which is a prominent feature of the Basic Law, dictates that Hong Kong will retain its unique common law and capitalist system for 50 years after the handover in 1997. Under the principle of “one country, two systems,” Hong Kong’s legal system, which is different from that of the PRC, is based on the common law supplemented by statutes.

According to Article 18 of the Basic Law, national laws adopted by the PRC shall not be applied in Hong Kong, except for those listed in Annex III to the Basic Law, such as the laws in relation to the national flag, national anthem, and diplomatic privileges and immunities. Further, there is no legislation stating that the laws in Hong Kong should be commensurate with those in the PRC. Despite the foregoing, the legal and operational risks of operating in China could still apply to any future business operations in Hong Kong.

There remains uncertainty as to how the various PRC laws will be interpreted or implemented and whether the PRC regulatory agencies may adopt new laws, regulations, rules, or detailed implementation and interpretation related to various laws, and as to the applicability of PRC laws to any future business operations in Hong Kong. If any such new laws, regulations, rules, or implementation and interpretation come into effect, we will take all reasonable measures and actions to comply and to minimize the adverse effect of such laws on us. However, there can be no assurance that any new PRC laws, regulations, rules, implementation, or interpretation will not have an adverse effect on any future business operations of our Hong Kong subsidiary.

Recent statements by the PRC regulatory authorities have indicated an intent to impose more oversight and supervision over offerings conducted overseas and/or foreign investment in China-based issuers. On February 17, 2023, the China Securities Regulatory Commission, or the CSRC released a set of new regulations which consists of the Trial Administrative Measures

of Overseas Securities Offering and Listing by Domestic Companies, or the Trial Measures, and five supporting guidelines, which came into effect on March 31, 2023. On the same date, the CSRC also released the Notice on the Arrangements for the Filing Management of Overseas Listing of Domestic Companies, or the Notice. The Trial Measures refine the regulatory system by subjecting both direct and indirect overseas offering and listing activities to the CSRC filing-based administration. Requirements for filing entities, time points and procedures are specified. A PRC domestic company that seeks to offer and list securities in overseas markets shall fulfill the filing procedure with the CSRC per the requirements of the Trial Measures. Where a PRC domestic company seeks to indirectly offer and list securities in overseas markets, the issuer shall designate a major domestic operating entity, which shall, as the domestic responsible entity, file with the CSRC. The Trial Measures also lay out requirements for the reporting of material events. Breaches of the Trial Measures, such as offering and listing securities overseas without fulfilling the filing procedures, shall bear legal liabilities, including a fine between RMB 1.0 million (approximately $150,000) and RMB 10.0 million (approximately $1.5 million), and the Trial Measures heighten the cost for offenders by enforcing accountability with administrative penalties and incorporating the compliance status of relevant market participants into the Securities Market Integrity Archives. In the opinion of our PRC counsel, Jiangsu Junjin Law Firm, we are required to file with the CSRC within three business days after submitting the application documents for offering and listing in the U.S., and this offering is contingent upon the completion of our filing with the CSRC. We have duly completed the required filings with the CSRC for this offering in accordance with the requirements under the Trial Measures. The CSRC published the notification on our completion of the required filing procedures for this offering on the CSRC website on April 2, 2024. The Trial Measures and Notice were newly published and are subject to change from time to time. Any failure or perceived failure of us to fully comply with such new regulatory requirements could significantly limit or completely hinder our ability to offer or continue to offer securities to investors, cause significant disruption to our business operations, and severely damage our reputation, which could materially and adversely affect our financial condition and results of operations and could cause the value of our securities to significantly decline or become worthless. See “Risk Factors — Risks Related to Doing Business in China — We are required to fulfill the Trial Measures filing procedures and report relevant information to the CSRC; and, since the interpretation and implementation of the new regulations are still evolving, we cannot assure you that we will be able to complete the filings for this offering and any future offerings, and fully comply with the relevant new rules on a timely basis, if at all” on page 17.

As of the date of this prospectus, according to our PRC counsel, Jiangsu Junjin Law Firm, although we are required to complete the filing procedure in connection with our offering (including this offering and any subsequent offering) and listing under the Trial Measures, no relevant PRC laws or regulations in effect require that we obtain permission from any PRC authorities to issue securities to foreign investors, and we have not received any inquiry, notice, warning, sanction, or any regulatory objection to this offering from the CSRC, the CAC, or any other PRC authorities that have jurisdiction over our operating subsidiaries’ operations.

The Standing Committee of the National People’s Congress, or the SCNPC, or other PRC regulatory authorities may in the future promulgate laws, regulations or implementing rules that require our Company or any of our subsidiaries to obtain regulatory approval from Chinese authorities before listing in the U.S. In other words, although the Company has not received any denial to list on the U.S. exchange, our operating subsidiaries’ operations could be adversely affected, directly or indirectly; our ability to offer, or continue to offer, securities to investors would be potentially hindered and the value of our securities might significantly decline or become worthless, by existing or future laws and regulations relating to its business or industry or by influence or interruption by PRC governmental authorities, if we or our subsidiaries (i) do not receive or maintain such permissions or approvals, (ii) inadvertently conclude that such permissions or approvals are not required, and (iii) applicable laws, regulations, or interpretations change and we are required to obtain such permissions or approvals in the future. See “Risk Factors — Risks Related to Doing Business in China” beginning on page 17 and “— Risks Related to this Offering and Ownership of Our Ordinary Shares” beginning on page 35 of this prospectus for a discussion of these legal and operational risks and information that should be considered before making a decision to purchase our Ordinary Shares.

Pursuant to the Holding Foreign Companies Accountable Act, or the HFCAA, if the Public Company Accounting Oversight Board, or the PCAOB, is unable to inspect an issuer’s auditors for two consecutive years, the issuer’s securities are prohibited from trading on a U.S. stock exchange. On June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act, and on December 29, 2022, legislation entitled “Consolidated Appropriations Act, 2023” was signed into law by President Biden, which contained, among other things, an identical provision to the Accelerating Holding Foreign Companies Accountable Act and amended the HFCAA by requiring the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus reducing the time period for triggering the prohibition on trading. The PCAOB issued a Determination Report on December 16, 2021 which found that the PCAOB is

unable to inspect or investigate completely registered public accounting firms headquartered in mainland China or Hong Kong because of a position taken by one or more authorities in mainland China or Hong Kong. Furthermore, the PCAOB’s report identified the specific registered public accounting firms which are subject to these determinations. On August 26, 2022, the PCAOB announced that it had signed a Statement of Protocol (the “SOP”) with the CSRC and the Ministry of Finance of China, or the MOF. The SOP, together with two protocol agreements governing inspections and investigations (together, the “SOP Agreement”), establishes a specific, accountable framework to make possible complete inspections and investigations by the PCAOB of audit firms based in mainland China and Hong Kong, as required under U.S. law. On December 15, 2022, the PCAOB announced that it was able to secure complete access to inspect and investigate PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong completely in 2022. The PCAOB Board vacated its previous 2021 determinations that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong. However, whether the PCAOB will continue to be able to satisfactorily conduct inspections of PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong is subject to uncertainties and depends on a number of factors out of our and our auditor’s control. The PCAOB continues to demand complete access in mainland China and Hong Kong moving forward and was making plans to resume regular inspections in early 2023 and beyond, as well as to continue pursuing ongoing investigations and initiate new investigations as needed. The PCAOB has also indicated that it will act immediately to consider the need to issue new determinations with the HFCAA if needed.

As of the date of the prospectus, our auditor, Pan-China Singapore, the independent registered public accounting firm that issued the audit report included in this prospectus, is subject to PCAOB inspections. Pan-China Singapore is headquartered in Singapore and there are no limitations in Singapore on PCAOB inspections. Therefore, the Company believes that, as of the date of this prospectus, its auditor is not subject to the determinations announced by the PCAOB on December 16, 2021 relating to the PCAOB’s inability to inspect or investigate completely registered public accounting firms headquartered in mainland China or Hong Kong because of a position taken by one or more authorities in mainland China or Hong Kong. However, to the extent that the Company’s auditor’s work papers may, in the future, become located in China, such work papers will not be subject to inspection by the PCAOB because the PCAOB is currently unable to conduct inspections without the approval of the Chinese authorities. Inspections of certain other firms that the PCAOB has conducted outside of China have identified deficiencies in those firms’ audit procedures and quality control procedures, which may be addressed as part of the inspection process to improve future audit quality. In addition to subjecting the Company’s securities to the possibility of being prohibited from trading or delisted from a US exchange, the inability of the PCAOB to conduct inspections of the Company’s auditors’ work papers in China would make it more difficult to evaluate the effectiveness of its auditor’s audit procedures or quality control procedures as compared to auditors outside of China that are subject to PCAOB inspections. As a result, the Company’s investors would be deprived of the benefits of the PCAOB’s oversight of its auditor through such inspections and they may lose confidence in the Company’s reported financial information and procedures and the quality of its financial statements. The Company cannot assure you whether Nasdaq or other regulatory authorities will apply additional or more stringent criteria to it. Such uncertainty could cause the market price of the Company’s Ordinary Shares to be materially and adversely affected. See “Risk Factors — Risks Related to Doing Business in China — The recent joint statement by the SEC and PCAOB, proposed rule changes submitted by Nasdaq, and the HFCAA all 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 developments could add uncertainties to our offering” on page 27.

We currently do not maintain any cash management policies that dictate the purposes, amounts and procedures form cash transfers among the Company, our subsidiaries, or investors. Rather, as of the date of this prospectus, funds can be transferred in accordance with the applicable PRC laws and regulations. To the extent cash or assets in the business is in mainland China or Hong Kong or an entity incorporated in mainland China or Hong Kong, the funds or assets may not be available to fund operations or for other use outside of mainland China or Hong Kong due to the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash or assets. See “Risk Factors — Risks Related to Doing Business in China — To the extent cash or assets in the business is in the PRC or Hong Kong or a PRC or Hong Kong entity, the funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong due to regulations or the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash or assets” on page 24.

Under existing PRC foreign exchange regulations, payment of current account items, such as profit distributions and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval from the State Administration of Foreign Exchange, or the SAFE, by complying with certain procedural requirements.

Therefore, our PRC subsidiaries are able to pay dividends in foreign currencies to us without prior approval from SAFE, subject to the condition that the remittance of such dividends outside of the PRC complies with certain procedures under PRC foreign exchange regulations, such as the overseas investment registrations by our shareholders or the ultimate shareholders of our corporate shareholders who are PRC residents. Approval from, or registration with, appropriate government authorities is, however, required where the RMB is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. The PRC government may also at its discretion restrict access in the future to foreign currencies for current account transactions. Current PRC regulations permit our PRC subsidiaries to pay dividends to the Company only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. As of the date of this prospectus, there are no restrictions or limitations imposed by the Hong Kong government on the transfer of capital within, into and out of Hong Kong (including funds from Hong Kong to mainland China), except for the transfer of funds involving money laundering and criminal activities. Cayman Islands law prescribes that a company may only pay dividends out of its profits or share premium, and that a company may only pay dividends if, immediately following the date on which the dividend is paid, the company remains able to pay its debts as they fall due in the ordinary course of business. Other than that, there is no restrictions on Skycorp Cayman’s ability to pay dividends to its shareholders. See “Prospectus Summary — Transfers of Cash to and from Our Subsidiaries,” “Prospectus Summary — Summary of Risk Factors,” “Risk Factors — Risks Related to Doing Business in China — To the extent cash or assets in the business is in the PRC or Hong Kong or a PRC or Hong Kong entity, the funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong due to regulations or the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash or assets,” and “Risk Factors — Risks Related to Doing Business in China — We may rely on dividends and other distributions on equity paid by our operating subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our operating subsidiaries to make payments to us could have a material adverse effect on our ability to conduct our business.”

As a holding company, we may rely on dividends and other distributions on equity paid by our subsidiaries, including those based in the PRC, for our cash and financing requirements. If any of our PRC subsidiaries incurs debt on its own behalf in the future, the instruments governing such debt may restrict their ability to pay dividends to us. Skycorp Cayman is permitted under the laws of the Cayman Islands to provide funding to our subsidiary incorporated in Hong Kong, GreenHash Limited, through loans or capital contributions without restrictions on the amount of the funds. GreenHash Limited is permitted under the laws of Hong Kong to provide funding to Skycorp Cayman through dividend distribution without restrictions on the amount of the funds. There are no restrictions on dividend transfers from Hong Kong to the Cayman Islands. Current PRC regulations permit Ningbo WFOE and Guangzhou WFOE to pay dividends to the Company only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. The transfer of funds among companies is subject to the Provisions of the Supreme People’s Court on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases (2020 Revision, the “Provisions on Private Lending Cases”), which was implemented on August 20, 2020 to regulate the financing activities between natural persons, legal persons and unincorporated organizations. As advised by our PRC counsel, Jiangsu Junjin Law Firm, the Provisions on Private Lending Cases does not prohibit using cash generated from one subsidiary to fund another subsidiary’s operations. We have not been notified of any other restriction which could limit our PRC subsidiaries’ ability to transfer cash between PRC subsidiaries. As of the date of this prospectus, neither the Company nor its subsidiaries have made transfers, dividends, or distributions to investors and no investors have made transfers, dividends, or distributions to the Company or its subsidiaries. As of the date of this prospectus, no dividends or distributions have been made between Skycorp Cayman and any of its subsidiaries. We do not expect to pay any cash dividends in the foreseeable future. Currently, we make intra-group transactions through our organization in two ways: (1) investments by parent company in its subsidiaries; and (2) internal borrowing and lending between companies. Other than cash transferred through our organization by way of intra-group transactions, there were no other cash transfers and transfers of other assets between our holding company and our subsidiaries as of the date of this prospectus and during the fiscal years ended September 30, 2023 and 2022. See “Prospectus Summary — Transfers of Cash to and from Our Subsidiaries” on page 6.

TABLE OF CONTENTS

ABOUT THIS PROSPECTUS

We and the underwriters have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses prepared by us or on our behalf or to which we have referred you and which we have filed with the U.S. Securities and Exchange Commission (the “SEC”). We take no responsibility for and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the Ordinary Shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. We are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted or where the person making the offer or sale is not qualified to do so or to any person to whom it is not permitted to make such offer or sale. For the avoidance of doubt, no offer or invitation to subscribe for Ordinary Shares is made to the public in the Cayman Islands. The information contained in this prospectus is current only as of the date on the front cover of the prospectus. Our business, financial condition, results of operations, and prospects may have changed since that date.

Neither we nor the underwriters have taken any action to permit a public offering of the Ordinary Shares outside the United States or to permit the possession or distribution of this prospectus or any filed free-writing prospectus outside the United States. Persons outside the United States who come into possession of this prospectus or any filed free writing prospectus must inform themselves about, and observe any restrictions relating to, the offering of the Ordinary Shares and the distribution of this prospectus or any filed free-writing prospectus outside the United States.

Conventions that Apply to this Prospectus

Unless otherwise indicated, in this prospectus, the following terms shall have the meaning set out below:

Our reporting currency is the U.S. dollar. The functional currency of subsidiaries located in China is the RMB. The functional currency of subsidiaries located in Hong Kong is the Hong Kong dollars (“HK$”). This prospectus contains translations of certain RMB amounts into U.S. dollar amounts at specified rates solely for the convenience of the reader.

Our fiscal year end is September 30. References to a particular “fiscal year” are to our fiscal year ended September 30 of that calendar year. Our audited consolidated financial statements have been prepared in accordance with the generally accepted accounting principles in the United States (the “U.S. GAAP”).

Except where indicated or where the context otherwise requires, all information in this prospectus assumes no exercise by the underwriters of their over-allotment option.

We obtained the industry, market and competitive position data in this prospectus from our own internal estimates, surveys, and research as well as from publicly available information, industry and general publications and research, surveys and studies conducted by third parties. None of the independent industry publications used in this prospectus were prepared on our behalf. Industry publications, research, surveys, studies and forecasts generally state that the information they contain has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and uncertainties as the other forward-looking statements in this prospectus, and to risks due to a variety of factors, including those described under “Risk Factors.” These and other factors could cause results to differ materially from those expressed in these forecasts and other forward-looking information.

We have proprietary rights to trademarks used in this prospectus that are important to our business, many of which are registered under applicable intellectual property laws. Solely for convenience, the trademarks, service marks and trade names referred to in this prospectus are without the ®, ™ and other similar symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensors to these trademarks, service marks and trade names.

This prospectus contains additional trademarks, service marks and trade names of others. All trademarks, service marks and trade names appearing in this prospectus are, to our knowledge, the property of their respective owners. We do not intend our use or display of other companies’ trademarks, service marks or trade names to imply a relationship with, or endorsement or sponsorship of us by, any other person.

RISK FACTORS

Investing in our Ordinary Shares is highly speculative and involves a significant degree of risk. You should carefully consider the following risks, as well as other information contained in this prospectus, before making an investment in our company. The risks discussed below could materially and adversely affect our business, prospects, financial condition, results of operations, cash flows, ability to pay dividends, the trading price of our Ordinary Shares and ability to offer and continue to offer securities to investors. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business, prospects, financial condition, results of operations, cash flows and ability to pay dividends, and you may lose all or part of your investment.

Risks Related to Doing Business in China

Changes in the economic policies of the PRC may materially and adversely affect our business, financial condition and results of operations and may result in our inability to sustain our growth and expansion strategies.

All of our operating subsidiaries’ operations are conducted in China. A majority of our revenues are sourced from Asia, representing 88% and 93% of our total revenues for the six months ended March 31, 2024 and 2023, respectively, among which 81% and 57% of our total revenues derived from mainland China for the same years. Accordingly, our financial condition and results of operations are affected to a significant extent by the economic environment in the PRC.

The PRC economy has experienced significant growth in the past four decades, however, there can be no assurance that such growth will continue. As such, our future success is, to some extent, dependent on the economic conditions in China, and any significant downturn in market conditions may materially and adversely affect our business prospects, financial condition, results of operations and prospects.

Uncertainties with respect to the legal system in China, including risks and uncertainties regarding the enforcement of laws and that rules and regulations in China can change quickly with no advance notice, which could materially and adversely affect us.

The legal system of China is based on written statutes and their legal interpretations by the SCNPC. Previous court decisions may be cited for reference but have limited precedential value. Since 1979, the regulatory authority of China has been developing a comprehensive system of commercial laws, and considerable progress has been made in introducing laws and regulations dealing with economic matters such as foreign investment, corporate organization and governance, commerce, taxation and trade. However, since these laws and regulations are relatively new and can change quickly with no advance notice, and the Chinese legal system continues to rapidly evolve, the interpretation and of these laws and regulations may not be uniform and the enforcement of these laws and regulations involve uncertainties, which could result in a material change in our operating subsidiaries’ operations and/or the value of our Ordinary Shares. Since PRC administrative and court authorities have significant discretion in interpreting and implementing statutory provisions and contractual terms, it may be difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection we enjoy. These uncertainties may affect our judgment on the relevance of legal requirements and our ability to enforce our contractual rights or tort claims.

We are required to fulfill the Trial Measures filing procedures and report relevant information to the CSRC; and, since the interpretation and implementation of the new regulations are still evolving, we cannot assure you that we will be able to complete the filings for this offering and any future offerings, and fully comply with the relevant new rules on a timely basis, if at all.

On July 6, 2021, the relevant PRC government authorities issued Opinions on Strictly Cracking Down Illegal Securities Activities in accordance with the Law, which emphasized the need to strengthen the administration over illegal securities activities and the supervision on overseas listings by China-based companies and proposed to take effective measures, such as promoting the construction of relevant regulatory systems to deal with the risks and incidents faced by China-based overseas-listed companies. This opinions and any related implementation rules to be enacted may subject us to additional compliance requirement in the future. As of the date hereof, no official guidance or related implementation rules have been issued. As a result, the opinions remain unclear on how they will be interpreted, amended and implemented by the relevant PRC governmental authorities. We cannot assure that we will remain fully compliant with all new regulatory requirements of these opinions or any future implementation rules on a timely basis, or at all.

On December 24, 2021, the CSRC published the Draft Administrative Provisions and the Administrative Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comment) (the “Draft Filing Measures”). The Draft Administrative Provisions and the Draft Filing Measures lay out requirements for filing and include unified regulation management, strengthening regulatory coordination, and cross-border regulatory cooperation.

On February 17, 2023, the CSRC released a set of new regulations which consists of the Trial Measures and five supporting guidelines, which came into effect on March 31, 2023. On the same date, the CSRC also released the Notice. The Trial Measures refine the regulatory system by subjecting both direct and indirect overseas offering and listing activities to the CSRC filing-based administration. Requirements for filing entities, time points and procedures are specified. A PRC domestic company that seeks to offer and list securities in overseas markets shall fulfill the filing procedure with the CSRC per the requirements of the Trial Measures. Where a PRC domestic company seeks to indirectly offer and list securities in overseas markets, the issuer shall designate a major domestic operating entity, which shall, as the domestic responsible entity, file with the CSRC. The Trial Measures also lay out requirements for the reporting of material events. Breaches of the Trial Measures, such as offering and listing securities overseas without fulfilling the filing procedures, shall bear legal liabilities, including a fine between RMB 1.0 million (approximately $150,000) and RMB 10.0 million (approximately $1.5 million), and the Trial Measures heighten the cost for offenders by enforcing accountability with administrative penalties and incorporating the compliance status of relevant market participants into the Securities Market Integrity Archives.

According to the Notice, since the date of effectiveness of the Trial Measures on March 31, 2023, PRC domestic enterprises falling within the scope of filing that have been listed overseas or met certain circumstances are “existing enterprises.” Existing enterprises are not required to file with the CSRC immediately, and filings with the CSRC should be made as required if they involve refinancing and other filing matters. In the opinion of our PRC counsel, Jiangsu Junjin Law Firm, we are required to file with the CSRC within three business days after submitting the application documents for offering and listing in the U.S., and this offering is contingent upon the completion of our filing with the CSRC. We have duly completed the required filings with the CSRC for this offering in accordance with the requirements under the Trial Measures. The CSRC published the notification on our completion of the required filing procedures for this offering on the CSRC website on April 2, 2024.

However, if we do not maintain the permissions and approvals of the filing procedure in a timely manner under PRC laws and regulations, we may be subject to investigations by competent regulators, fines or penalties, ordered to suspend our relevant operations and rectify any non-compliance, prohibited from engaging in a relevant business or conducting any offering, and these risks could result in a material adverse change in our operating subsidiaries’ operations, limit our ability to offer or continue to offer securities to investors, or cause such securities to significantly decline in value or become worthless. The Trial Measures and Notice were newly published and are subject to change from time to time. Any failure or perceived failure of us to fully comply with such new regulatory requirements could significantly limit or completely hinder our ability to offer or continue to offer securities to investors, cause significant disruption to our business operations, and severely damage our reputation, which could materially and adversely affect our financial condition and results of operations and could cause the value of our securities to significantly decline or become worthless.

The M&A Rules and certain other PRC regulations establish additional procedures for some acquisitions of Chinese companies by foreign investors, which could create certain obstacles for us to pursue growth through acquisitions in China.

The M&A Rules adopted by six PRC regulatory agencies in August 2006 and amended in 2009, and some other regulations and rules concerning mergers and acquisitions established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time consuming. For example, the M&A Rules require that the PRC Ministry of Commerce, or the MOFCOM be notified in advance of any change-of-control transaction in which a foreign investor takes control of a PRC domestic enterprise, if (i) any important industry is concerned, (ii) such transaction involves factors that impact or may impact national economic security, or (iii) such transaction will lead to a change in control of a domestic enterprise which holds a famous trademark or PRC time-honored brand. Moreover, the Anti-Monopoly Law promulgated by the SCNPC effective in 2008 and latest amended in 2022, together with the Provisions of the State Council on Notification Thresholds for Concentrations Between Undertakings (2024 revision), requires that transactions which are deemed concentrations and involve parties with specified turnover thresholds (i.e., during the previous fiscal year, (i) the total global turnover of all operators participating in the transaction exceeds RMB 12 billion and at least two of these operators each had a turnover of more than RMB 800 million within China, or (ii) the total turnover within China of all the operators participating in the concentration exceeded RMB 4 billion, and at least two of these operators each had a turnover of more than RMB 800 million within China) must be cleared by MOFCOM before they can be completed.

Moreover, the Anti-Monopoly Law requires that the MOFCOM shall be notified in advance of any concentration of undertaking if certain thresholds are triggered. In addition, the security review rules issued by the MOFCOM that became effective in September 2011 specify that mergers and acquisitions by foreign investors that raise “national defense and security” concerns and mergers and acquisitions through which foreign investors may acquire de facto control over domestic enterprises that raise “national security” concerns are subject to strict review by the MOFCOM, and the rules prohibit any activities attempting to bypass a security review, including by structuring the transaction through a proxy or contractual control arrangement. In the future, we may expand our business by acquiring complementary businesses. Complying with the requirements of the above-mentioned regulations and other relevant rules to complete such transactions could be time-consuming, and any required approval processes, including obtaining approval from the MOFCOM or its local counterparts may delay or inhibit our ability to complete such transactions, which could affect our ability to expand our business or maintain our market share.

PRC regulation relating to offshore investment activities by PRC residents may limit our PRC subsidiaries’ ability to increase their registered capital or distribute profits to us, or otherwise expose us or our shareholders who are Chinese residents to liabilities or penalties.

In July 2014, SAFE promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents’ Offshore Investment and Financing and Roundtrip Investment through Special Purpose Vehicles, or SAFE Circular 37, which replaces the previous SAFE Circular 75. SAFE Circular 37 requires PRC residents, including PRC individuals and PRC corporate entities, to register with SAFE or its local branches in connection with their direct or indirect offshore investment activities. SAFE Circular 37 is applicable to our shareholders who are PRC residents and may be applicable to any offshore acquisitions that we may make in the future.

Under SAFE Circular 37, PRC residents who make, or have prior to the implementation of SAFE Circular 37 made, direct or indirect investments in offshore special purpose vehicles, or SPVs, are required to register such investments with SAFE or its local branches. In addition, any PRC resident who is a direct or indirect shareholder of an SPV, is required to update its registration with the local branch of SAFE with respect to that SPV, to reflect any material change. Moreover, any subsidiary of such SPV in China is required to urge the PRC resident shareholders to update their registration with the local branch of SAFE to reflect any material change. If any PRC resident shareholder of such SPV fails to make the required registration or to update the registration, the subsidiary of such SPV in China may be prohibited from distributing its profits or the proceeds from any capital reduction, share transfer or liquidation to the SPV, and the SPV may also be prohibited from making additional capital contributions into its subsidiaries in China. In February 2015, SAFE promulgated a Notice on Further Simplifying and Improving Foreign Exchange Administration Policy on Direct Investment, or SAFE Notice 13. Under SAFE Notice 13, applications for foreign exchange registration of inbound foreign direct investments and outbound direct investments, including those required under SAFE Circular 37, must be filed with qualified banks instead of SAFE. Qualified banks should examine the applications and accept registrations under the supervision of SAFE. We have used our best efforts to notify PRC residents or entities who directly or indirectly hold shares in our Cayman Islands holding company and who are known to us as being PRC residents to complete the foreign exchange registrations. However, we may not be informed of the identities of all the PRC residents or entities holding direct or indirect interest in our company, nor can we compel our beneficial owners to comply with SAFE registration requirements. We cannot assure you that all other shareholders or beneficial owners of ours who are PRC residents or entities have complied with, and will in the future make, obtain or update any applicable registrations or approvals required by, SAFE regulations. Failure by such shareholders or beneficial owners to comply with SAFE regulations, or failure by us to amend the foreign exchange registrations of our PRC subsidiaries, could subject us to fines or legal sanctions, restrict our overseas or cross-border investment activities, and limit our PRC subsidiaries’ ability to make distributions or pay dividends to us or affect our ownership structure, which could adversely affect our business and prospects.

Furthermore, as these foreign exchange and outbound investment related regulations are relatively new and their interpretation and implementation has been constantly evolving. For example, we may be subject to a more stringent review and approval process with respect to our foreign exchange activities, such as remittance of dividends and foreign-currency-denominated borrowings, which may adversely affect our financial condition and results of operations. We cannot assure you that we have complied or will be able to comply with all applicable foreign exchange and outbound investment related regulations. In addition, if we decide to acquire a PRC domestic company, we cannot assure you that we or the owners of such company, as the case may be, will be able to obtain the necessary approvals or complete the necessary filings and registrations required by the foreign exchange regulations. This may restrict our ability to implement our acquisition strategy and could adversely affect our business and prospects.

PRC regulations on loans to and direct investment in PRC entities by offshore holding companies may delay or prevent us from making loans or additional capital contributions to our PRC operating subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.

As an offshore holding company of our PRC subsidiaries, we may make loans to our PRC subsidiaries or may make additional capital contributions to our PRC subsidiaries, subject to satisfaction of applicable governmental registration and approval requirements.

Any loans we extend to our PRC subsidiaries cannot exceed the statutory limit and must be registered with the local counterpart of the SAFE.

We may also decide to finance our PRC subsidiaries by means of capital contributions. According to the relevant PRC regulations on foreign-invested enterprises in China, these capital contributions are subject to registration with or approval by the MOFCOM or its local counterparts. In addition, the PRC government also restricts the convertibility of foreign currencies into Renminbi and the use of the proceeds. On March 30, 2015, SAFE promulgated the Notice on Reforming the Administration of Foreign Exchange Settlement of Capital of Foreign-invested Enterprises, or SAFE Circular 19, which took effect and replaced certain previous SAFE regulations from June 1, 2015. SAFE further promulgated the Circular on Reforming and Regulating Policies on the Management of the Settlement of Foreign Exchange of Capital Accounts, or SAFE Circular 16, effective on June 9, 2016, which, among other things, amend certain provisions of SAFE Circular 19. According to SAFE Circular 19 and SAFE Circular 16, the flow and use of the RMB capital converted from foreign currency denominated registered capital of a foreign-invested company is regulated such that Renminbi capital may not be used for business beyond its business scope or to provide loans to persons other than affiliates unless otherwise permitted under its business scope. Violations of the applicable circulars and rules may result in severe penalties, including substantial fines as set forth in the Foreign Exchange Administration Regulations. SAFE Circular 19 and SAFE Circular 16 may significantly limit our ability to use Renminbi converted from the net proceeds of this offering to fund our PRC operating subsidiaries, to invest in or acquire any other PRC companies through our PRC Subsidiaries, which may adversely affect our business, financial condition and results of operations.

The Chinese government has significant oversight and discretion over our operating subsidiaries’ business operations and may intervene or influence our operating subsidiaries’ operations at any time. Actions by the PRC government to exert control over offerings conducted overseas by, and foreign investment in, China-based issuers could result in a material change in our operating subsidiaries’ operations, and our Ordinary Shares could decline in value or become worthless.

Our business is subject to supervision and regulation by the relevant PRC governmental authorities, including but not limited to the SAMR and the State Administration for Industry and Commerce. Together, these governmental authorities promulgate and enforce regulations that cover many aspects of our day-to-day operations. The PRC government has significant oversight and discretion over the conduct of our operating subsidiaries’ business operations and may intervene or influence our operating subsidiaries’ operations at any time. If we are deemed to be not in compliance with these requirements, we may be subject to fines and other administrative penalties from the relevant PRC government authorities. In case of our failure to rectify our noncompliance within the required period by the relevant PRC government authorities, we may be forced to suspend our operation.

Existing and new laws and regulations may be enforced from time to time and the interpretation and implementation of current and any future PRC laws and regulations applicable to us are subject to evolving. If the PRC government promulgates new laws and regulations that impose additional restrictions on our operating subsidiaries’ operations, or tightens enforcements of existing or new laws or regulations, it has the authority, among other things, to levy fines, confiscate income, revoke business licenses, and require us to discontinue our relevant business or impose restrictions on the affected portion of our business. Any of these actions by the PRC government may have a material and adverse effect on our results of operations. As a result, our business, reputation, value of our ordinary shares, financial condition and results of operations may be materially and adversely affected.

The Chinese government has exerted more oversight and control over offerings that are conducted overseas and foreign investment in China-based issuers. Such actions could 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.

Recent statements by the Chinese government have indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investments in China-based issuers. Any future action or control by the PRC government over offerings conducted overseas and/or foreign investment in China-based issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless.

Recent statements by the Chinese government have indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investments in China-based issuers. Our business does not involve the collection of user data, implicate cybersecurity, or involve any other type of restricted industry, and we do not believe we are among the “operator of critical information infrastructure,” “data processor,” “online platform operators,” or “data handler” as mentioned above. However, since the Measures for Cybersecurity Review (2021 version) was newly adopted and the Network Internet Data Protection Draft Regulations (draft for comments) is in the process of being formulated, it is unclear how it will be interpreted, amended, and implemented by the relevant PRC governmental authorities. Thus, we cannot assure you that we will not be deemed as the “operator of critical information infrastructure,” “data processor,” “online platform operators,” or “data handler” as mentioned above. We believe that, as of the date of this prospectus, the Company and its subsidiaries, (1) are not required to obtain permissions or approvals from any PRC authorities to operate or issue our Ordinary Shares to foreign investors, and (2) are not subject to permission requirements from the CSRC, the CAC or any other entity that is required to approve of our operations. As of the date of this prospectus, we and our PRC subsidiaries have not been involved in any investigations on cybersecurity review initiated by the CAC or related governmental regulatory authorities, and have not received any requirements to obtain permissions from any PRC authorities to issue our Ordinary Shares to foreign investors or were denied such permissions by any PRC authorities. Uncertainties still exist due to the possibility that laws, regulations, or policies in the PRC could change rapidly in the future. Any future action by the PRC government expanding the categories of industries and companies whose foreign securities offerings are subject to review by the CRSC or the CAC could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless.

Recent greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, could adversely impact our business and our offering.

On July 10, 2021, the CAC issued the Measures for public comments, according to which, among others, an “operator of critical information infrastructure” or a “data processor,” who has personal information of more than one million users and is going to list in foreign countries, must report to the relevant cybersecurity review office for a cybersecurity review. On December 28, 2021, the CAC jointly with the relevant authorities formally published Measures for Cybersecurity Review (2021 version) which took effect on February 15, 2022 and replace the former Measures for Cybersecurity Review (2020 version). Measures for Cybersecurity Review (2021 version) stipulates that operators of critical information infrastructure purchasing network products and services, and online platform operator carrying out data processing activities that affect or may affect national security, shall conduct a cybersecurity review, any online platform operator who controls more than one million users’ personal information must go through a cybersecurity review by the cybersecurity review office if it seeks to be listed in a foreign country.

On November 14, 2021, the CAC published the Data Security Administration Draft, which provides that data processing operators engaging in data processing activities that affect or may affect national security must be subject to network data security review by the relevant Cyberspace Administration of the PRC. According to the Data Security Administration Draft, data processing operators who possess personal data of at least one million users or collect data that affects or may affect national security must be subject to network data security review by the relevant Cyberspace Administration of the PRC. The deadline for public comments on the Security Administration Draft was December 13, 2021.

In addition, on September 28, 2023, CAC published the Provisions on Regulating and Promoting Cross-border Data Transfer (Draft for Comments), or the Cross-border Data Transfer Provisions. The Cross-border Data Transfer Provisions provide certain exemptions from obligations under the circumstances of cross-border data transfer, including, among others, the obligations for data security assessment, concluding a standard contract for provision of personal information abroad or passing the certification for personal information protection. However, the Cross-border Data Transfer Provisions were released for public comment only and their provisions and anticipated adoption date are subject to change, and their interpretation and implementation remain uncertain.

As of the date of this prospectus, neither we nor our operating subsidiaries have been involved in any investigations on cybersecurity review initiated by any regulatory authority, nor has any of them received any inquiry, notice, or sanction. If the Data Security Administration Draft is enacted as proposed in the future, we believe that our operating subsidiaries’ operations and listing will not be affected by both the Measures for Cybersecurity Review (2021 version) or the Data Security Administration Draft, and that we will not be subject to cybersecurity review by the CAC for this offering, given that: (i) we do not possess personal information of more than one million individuals in our business operations as of the date of this prospectus and do not anticipate that we will be collecting over one million users’ personal information in the near future; (ii) as a company that primarily in the provision of solar PV products and HPC servers, our operating subsidiaries in China are unlikely to be classified as a critical information infrastructure operator by the regulatory agencies, and we have not been informed as an operator of critical information infrastructure by any government authorities; (iii) data processed in our business is unlikely to have a bearing on national security and therefore is unlikely to be classified as core or important data by the authorities. However, the relevant regulatory authorities of China may take a view that is contrary to or otherwise different from the opinion stated above. The enforcement as to how the Measures for Cybersecurity Review (2021 version) and the Data Security Administration Draft will be interpreted or implemented, and whether the regulatory agencies of China, including the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the Measures for Cybersecurity Review (2021 version) and the Data Security Administration Draft are subject to change. If any such new laws, regulations, rules, or implementation and interpretation come into effect and may have an adverse effect on us, we will take all reasonable measures and actions to comply and to minimize the adverse effect of such laws on us. We cannot guarantee, however, that we will not be subject to cybersecurity review in the future. During such review, we may be required to suspend our operating subsidiaries’ operation or experience other disruptions to their operations. Cybersecurity review could also result in negative publicity with respect to our Company and diversion of our managerial and financial resources, which could materially and adversely affect our business, financial condition, and results of operations.

Under the PRC Enterprise Income Tax Law, we may be classified as a “Resident Enterprise” of China. Such classification will likely result in unfavorable tax consequences to us and our non-PRC shareholders.

Under the PRC Enterprise Income Tax Law, or the EIT Law, which became effective on January 1, 2008 and as amended in December 2018, an enterprise established outside of China with “de facto management bodies” within China is considered a Chinese “resident enterprise” for enterprise income tax purposes. The implementing rules of the EIT Law define de facto management as “substantial and overall management and control over the production and operations, personnel, accounting, and properties” of the enterprise.

On April 22, 2009, the State Administration of Taxation of China, or the SAT, issued the Notice Concerning Relevant Issues Regarding Cognizance of Chinese Investment Controlled Enterprises Incorporated Offshore as Resident Enterprises pursuant to Criteria of de facto Management Bodies, further interpreting the application of the EIT Law and its implementation to offshore entities controlled by a Chinese enterprise or group. Pursuant to this notice, an enterprise incorporated in an offshore jurisdiction and controlled by a Chinese enterprise or group will be classified as a “non-domestically incorporated resident enterprise” if (i) its senior management in charge of daily operations reside or perform their duties mainly in China; (ii) its financial or personnel decisions are made or approved by bodies or persons in China; (iii) its substantial assets and properties, accounting books, corporate stamps, board and shareholder minutes are kept in China; and (iv) all of its directors with voting rights or senior management reside in China. A resident enterprise would be subject to an enterprise income tax rate of 25% on its worldwide income and must pay a withholding tax at a rate of 10% when paying dividends to its non-PRC shareholders. Because all of our operating subsidiaries’ operations and senior management are located within the PRC and are expected to remain so for the foreseeable future, we may be considered a PRC resident enterprise for enterprise income tax purposes and therefore subject to the PRC enterprise income tax at the rate of 25% on its worldwide income. However, it remains unclear as to whether the Notice is applicable to an offshore enterprise controlled by a Chinese natural person. Therefore, it is unclear how tax authorities will determine tax residency based on the facts of each case.

If the PRC tax authorities determine that we are a “resident enterprise” for PRC enterprise income tax purposes, a number of unfavorable PRC tax consequences could follow. First, we may be subject to the enterprise income tax at a rate of 25% on our worldwide taxable income as well as PRC enterprise income tax reporting obligations. In our case, this would mean that income such as non-China source income would be subject to PRC enterprise income tax at a rate of 25%. Currently, we do not have any non-China source income, as we conduct our sales in China. However, under the EIT Law and its implementing rules, dividends paid to us from our PRC subsidiary would be deemed as “qualified

investment income between resident enterprises” and therefore qualify as “tax-exempt income” pursuant to clause 26 of the EIT Law. Second, it is possible that future guidance issued with respect to the new “resident enterprise” classification could result in a situation in which the dividends we pay with respect to our ordinary shares, or the gain our non-PRC shareholders may realize from the transfer of our ordinary shares, may be treated as PRC-sourced income and may therefore be subject to a 10% PRC withholding tax. The EIT Law and its implementing regulations with respect to the interpretation and identification of PRC-sourced income, and the application and assessment of withholding taxes are subject to change from time to time. If we are required under the EIT Law and its implementing regulations to withhold PRC income tax on dividends payable to our non-PRC shareholders, or if non-PRC shareholders are required to pay PRC income tax on gains on the transfer of their ordinary shares, our business could be negatively impacted and the value of your investment may be materially reduced. Further, if we were treated as a “resident enterprise” by PRC tax authorities, we would be subject to taxation in both China and such countries in which we have taxable income, and our PRC tax may not be creditable against such other taxes.

We may be exposed to liabilities under the Foreign Corrupt Practices Act and Chinese anti-corruption law.

In connection with this offering, we will become subject to the U.S. Foreign Corrupt Practices Act (the “FCPA”), and other laws that prohibit improper payments or offers of payments to foreign governments and their officials and political parties by U.S. persons and issuers as defined by the statute for the purpose of obtaining or retaining business. We are also subject to Chinese anti-corruption laws, which strictly prohibit the payment of bribes to government officials. We have operations agreements with third parties, and make sales in China, which may experience corruption. Our activities in China create the risk of unauthorized payments.

Although we believe, to date, we have complied in all material respects with the provisions of the FCPA and Chinese anti-corruption law, our existing safeguards and any future improvements may prove to be less than effective, and the employees, consultants, or distributors may engage in conduct for which we might be held responsible. Violations of the FCPA or Chinese anti-corruption law may result in severe criminal or civil sanctions, and we may be subject to other liabilities, which could negatively affect our business, operating results and financial condition. In addition, the government may seek to hold our Company liable for successor liability FCPA violations committed by companies in which we invest or that we acquire.

Restrictions on the remittance of RMB into and out of China and governmental regulations on currency conversion may affect the value of your investment.

The PRC government regulates and imposes certain restrictions on the convertibility of the RMB into foreign currencies and, in certain cases, the remittance of currency out of China. We receive a majority of our revenues in RMB. Under our current corporate structure, our income is primarily derived from dividend payments from our PRC subsidiaries. Shortages in the availability of foreign currency may restrict the ability of our PRC subsidiaries to remit sufficient foreign currency to pay dividends or other payments to us, or otherwise satisfy their foreign currency denominated obligations. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and expenditures from trade-related transactions can be made in foreign currencies without prior approval from SAFE by complying with certain procedural requirements. However, approval from appropriate government authorities is required where RMB is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. The PRC government may also at its discretion restrict access in the future to foreign currencies for current account transactions. If the foreign exchange administration system prevents us from obtaining sufficient foreign currency to satisfy our currency demands, we may not be able to pay dividends in foreign currencies to our security-holders.

We may rely on dividends and other distributions on equity paid by our operating subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our operating subsidiaries to make payments to us could have a material adverse effect on our ability to conduct our business.

We are a holding company incorporated in the Cayman Islands, and we operate our businesses through our operating subsidiaries. Therefore, the availability of funds for us to pay dividends to our shareholders and to service our indebtedness depends upon dividends received from the PRC subsidiaries. If the PRC subsidiaries incur debt or losses, their ability to pay dividends or other distributions to us may be impaired. As a result, our ability to pay dividends and to repay our indebtedness will be restricted. PRC laws require that dividends be paid only out of the after-tax profit of our subsidiaries in the PRC calculated according to PRC accounting principles, which differ in

many aspects from generally accepted accounting principles in other jurisdictions. PRC laws also require enterprises established in the PRC to set aside part of their after-tax profits as statutory reserves. These statutory reserves are not available for distribution as cash dividends. In addition, restrictive covenants in bank credit facilities or other agreements that we or our subsidiaries may enter into in the future may also restrict the ability of our subsidiaries to pay dividends to us. These restrictions on the availability of our funding may impact our ability to pay dividends to our shareholders and to service our indebtedness.

To the extent cash or assets in the business is in the PRC or Hong Kong or a PRC or Hong Kong entity, the funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong due to regulations or the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash or assets.

The transfer of funds and assets among Skycorp Cayman and its subsidiaries is subject to restrictions. The PRC government regulates the conversion of the RMB into foreign currencies and the remittance of currencies out of the PRC. See “Risk Factors — Risks Related to Doing Business in China — Restrictions on the remittance of RMB into and out of China and governmental regulations on currency conversion may affect the value of your investment.” In addition, the EIT Law and its implementation rules provide that a withholding tax at a rate of 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises, unless reduced under treaties or arrangements between the PRC central government and the governments of other countries or regions where the non-PRC resident enterprises are tax resident. See “Risk Factors — Risks Related to Doing Business in China — Under the PRC Enterprise Income Tax Law, we may be classified as a “Resident Enterprise” of China. Such classification will likely result in unfavorable tax consequences to us and our non-PRC shareholders.”

As of the date of this prospectus, there are no restrictions or limitations imposed by the Hong Kong government on the transfer of capital within, into and out of Hong Kong (including funds from Hong Kong to the PRC), except for the transfer of funds involving money laundering and criminal activities. However, there is no guarantee that the Hong Kong government will not promulgate new laws or regulations that may impose such restrictions in the future.

As a result of the above, to the extent cash or assets in the business is in the PRC or Hong Kong or a PRC or Hong Kong entity, the funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong due to regulations or the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash or assets.

Our business may be materially and adversely affected if any of our PRC subsidiary declare bankruptcy or become subject to a dissolution or liquidation proceeding.

The Enterprise Bankruptcy Law of the PRC, or the Bankruptcy Law, came into effect on June 1, 2007. The Bankruptcy Law provides that an enterprise will be liquidated if the enterprise fails to settle its debts as and when they fall due and if the enterprise’s assets are, or are demonstrably, insufficient to clear such debts.

Our PRC subsidiaries hold certain assets that are important to our business operations. If our PRC subsidiaries undergo a voluntary or involuntary liquidation proceeding, unrelated third-party creditors may claim rights to some or all of these assets, thereby hindering our ability to operate our business, which could materially and adversely affect our business, financial condition and results of operations.

Fluctuations in exchange rates could adversely affect our business and the value of our securities.

Changes in the value of the RMB against the U.S. dollar and other foreign currencies are affected by, among other things, changes in China’s political and economic conditions. Any significant revaluation of the RMB may have a material adverse effect on our revenues and financial condition, and the value of, and any dividends payable on our shares in U.S. dollar terms. For example, to the extent that we need to convert U.S. dollars we receive from our initial public offering into RMB for our operating subsidiaries’ operations, appreciation of the RMB against the U.S. dollar would have an adverse effect on RMB amount we would receive from the conversion. Conversely, if we decide to convert our RMB into U.S. dollars for the purpose of paying dividends on our ordinary shares or for other business purposes, appreciation of the U.S. dollar against the RMB would have a negative effect on the U.S. dollar amount available to us. In addition, fluctuations of the RMB against other currencies may increase or decrease the cost of imports and exports, and thus affect the price-competitiveness of our products against products of foreign manufacturers or products relying on foreign inputs.

Since July 2005, the RMB is no longer pegged to the U.S. dollar. Although the People’s Bank of China, or the PBOC regularly supervise the foreign exchange market to prevent significant short-term fluctuations in the exchange rate, the RMB may appreciate or depreciate significantly in value against the U.S. dollar in the medium to long term. Moreover, it is possible that in the future PRC authorities may lift restrictions on fluctuations in the RMB exchange rate and lessen intervention in the foreign exchange market.

Increases in labor costs in the PRC may adversely affect our business and results of operations.

The currently effective PRC Labor Contract Law, or the Labor Contract Law was first adopted on June 29, 2007 and later amended on December 28, 2012. The Labor Contract Law has reinforced the protection of employees who have the right, among others, to have written employment contracts, to enter into employment contracts with no fixed term under certain circumstances, to receive overtime wages and to terminate or alter terms in labor contracts. Furthermore, the Labor Contract Law sets forth additional restrictions and increases the costs involved with dismissing employees. To the extent that we need to significantly reduce our workforce, the Labor Contract Law could adversely affect our ability to do so in a timely and cost-effective manner, and our results of operations could be adversely affected. In addition, for employees whose employment contracts include noncompetition terms, the Labor Contract Law requires us to pay monthly compensation after such employment is terminated, which will increase our operating expenses.

We expect that our labor costs, including wages and employee benefits, will continue to increase. Unless we are able to pass on these increased labor costs to our buyers by increasing the prices of our products and services, our financial condition and results of operations would be materially and adversely affected.

Failure to make adequate contributions to various employee benefits plans as required by PRC regulations may subject us to penalties.

Pursuant to the Social Security Law of the PRC, which was promulgated by the SCNPC on October 28, 2010 and amended on December 29, 2018, employers shall pay the basic pension insurance, medical insurance, work-related injury insurance, unemployment insurance and maternity insurance for all eligible employees. Our PRC subsidiaries have been making social security premium payments at least at the minimum wage level for all eligible employees.

In accordance with the Regulations on Management of Housing Provident Fund, which were promulgated by the PRC State Council on April 3, 1999, and last amended on March 24, 2002, employers must register at the designated administrative centers and open bank accounts for employees’ housing funds deposits. Employers and employees are also required to pay and deposit housing funds, in an amount no less than 5% of the monthly average salary of each of the employees in the preceding year in full and on time. Our PRC subsidiaries have opened bank accounts for its employees’ housing funds deposits, and deposited housing funds at least at the minimum wage level for all eligible employees.

The applicable PRC laws and regulations on employee benefits stipulate that employers shall be responsible for making social security premium payments and housing provident funds contributions based on the actual wage paid to employees. In practice, given the different economic development levels in different regions, the relevant employment benefit regulations have not been implemented consistently by local governments in China, and each provincial or municipal governing Social Security Bureau has its own discretion to enforce the compliance of these regulations by employers.

In respect of the social insurance, our PRC legal counsel, Jiangsu Junjin Law Firm, has advised that, if an enterprise fails to pay the full amount of the social insurance contributions as legally required, the social insurance authority may order it to pay the outstanding amount of the social insurance contributions within a prescribed time limit and may impose a late fee at a daily rate of 0.05% of the outstanding amount, accruing from the date when the social insurance contributions were due. If the enterprise still fails to make such payment within the prescribed time, the social insurance authority may further impose an additional fine ranging from one to three times of the total outstanding balance. In respect of the housing provident fund, our PRC legal counsel has advised that, if an enterprise fails to pay the full amount of the housing provident fund contributions as legally required, the housing provident fund authority may order it to pay the outstanding amount of the housing provident fund within a prescribed time limit. If the enterprise still fails to make such payment within the prescribed time, the housing provident fund authority may apply for an order from the relevant people’s courts to make such payment. As of the date of this prospectus, our PRC subsidiaries have not received any notification from the PRC governmental authorities requiring us to pay

any outstanding amount of the social insurance and housing provident fund contributions. In the event that our PRC subsidiaries are notified to make sufficient contributions, we have to pay the outstanding amount plus late fee or fines in relation to the underpaid employee benefits. The financial condition and results of operations of us and our PRC subsidiaries may be adversely affected.

If we become directly subject to the scrutiny, criticism and negative publicity involving U.S.-listed Chinese companies, we may have to expend significant resources to investigate and resolve the matter which could harm our business operations, this offering and our reputation and could result in a loss of your investment in our Ordinary Shares, especially if such matter cannot be addressed and resolved favorably.

U.S. public companies that have substantially all of their operations in China have been the subject of intense scrutiny, criticism and negative publicity by investors, financial commentators and regulatory agencies, such as the SEC. Much of the scrutiny, criticism and negative publicity has centered around financial and accounting irregularities, a lack of effective internal controls over financial accounting, inadequate corporate governance policies or a lack of adherence thereto and, in many cases, allegations of fraud. As a result of the scrutiny, criticism and negative publicity, the publicly traded stock of many U.S. listed Chinese companies has sharply decreased in value and, in some cases, has become virtually worthless. Many of these companies are now subject to shareholder lawsuits and SEC enforcement actions and are conducting internal and external investigations into the allegations. It is not clear what effect this sector-wide scrutiny, criticism and negative publicity will have on our Company, our business and this offering. If we become the subject of any unfavorable allegations, whether such allegations are proven to be true or untrue, we will have to expend significant resources to investigate such allegations and/or defend the Company. This situation may be a major distraction to our management. If such allegations are not proven to be groundless, our Company and business operations will be severely hampered and your investment in our ordinary shares could be rendered worthless.

You may experience difficulties in effecting service of legal process, enforcing foreign judgments, or bringing actions in China against us or our management named in the prospectus based on foreign law. It may also be difficult for you or overseas regulators to conduct investigations based on foreign laws.

We are a company incorporated under the laws of the Cayman Islands, all of our operating subsidiaries’ operations are conducted in China and all of our assets are located in China. In addition, all of our senior executive officers, Mr. Weiqi Huang, Ms. Zhe Liang, Mr. Jiye He, Mr. Gaokui Zhang, and Mr. Xufeng Lu, are located in the PRC. As a result, it may be difficult for you to effect service of process upon us or those persons inside China. In addition, there is uncertainty as to whether the courts of the Cayman Islands or the PRC would recognize or enforce judgments of U.S. courts against us or such persons predicated upon the civil liability provisions of U.S. securities laws or those of any U.S. state.

The recognition and enforcement of foreign judgments are provided for under the PRC Civil Procedures Law. 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 where the judgment is made or on principles of reciprocity between jurisdictions. China does not have any treaties or other forms of written arrangement with the U.S. that provide for the reciprocal recognition and enforcement of foreign judgments. In addition, according to the PRC Civil Procedures Law, the PRC courts will not enforce a foreign judgment against us or our directors and officers if they decide that the judgment violates the basic principles of PRC laws or national sovereignty, security, or public interest. As a result, it is uncertain whether and on what basis a PRC court would enforce a judgment rendered by a court in the U.S. See “Enforceability of Civil Liabilities” on page 49.

It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within China. Although the authorities in China may establish a regulatory cooperation mechanism with its counterparts of another country or region to monitor and oversee cross-border securities activities, such regulatory cooperation with the securities regulatory authorities in the U.S. may not be efficient in the absence of a practical cooperation mechanism. Furthermore, according to Article 177 of the PRC Securities Law, or “Article 177,” which became effective in March 2020, no overseas securities regulator is allowed to directly conduct investigations or evidence collection activities within the territory of the PRC. Article 177 further provides that Chinese entities and individuals are not allowed to provide documents or materials related to securities business activities to foreign agencies without prior consent from the securities regulatory authority of the PRC State Council and the competent departments of the PRC State Council. While the detailed interpretation of or implementing of rules under Article 177 have to be promulgated, the inability of an overseas securities regulator to directly conduct investigation or evidence collection activities within China may further increase the difficulties faced by you in protecting your interests.

Our financial and operating performance may be adversely affected by general economic conditions, natural catastrophic events, epidemics, and public health crises that impact the solar PV energy and HPC server industries.

Our operating results will be subject to fluctuations based on general economic conditions, in particular those conditions that impact the solar PV energy and HPC server industries. Deterioration in economic conditions could cause decreases in both volume and reduce and/or negatively impact our short-term ability to grow our revenues. Further, any decreased collectability of accounts receivable or early termination of agreements due to deterioration in economic conditions could negatively impact our results of operations.

Our business is subject to the impact of natural catastrophic events such as earthquakes, floods or power outages, political crises such as terrorism or war, and public health crises, such as disease outbreaks, epidemics, or pandemics in the U.S. and other business locations world widely. Our customers may experience financial distress, filing for bankruptcy protection, going out of business, or suffering disruptions in their business due to the coronavirus outbreak; as a result, our revenues may be impacted. The extent to which the epidemics impacts our operating subsidiaries’ operations will depend on future developments, which are highly uncertain and will include emerging information concerning the severity of the epidemics and the actions taken by governments and private businesses. However, it is unlikely to result in a material adverse impact on our business, results of operations and financial condition at least for the near term.

Similarly, natural disasters, wars (including the potential of war), terrorist activity (including threats of terrorist activity), social unrest and heightened travel security measures instituted in response, and travel-related accidents, as well as geopolitical uncertainty and international conflict, will affect travel volume and may in turn have a material adverse effect on our business and results of operations. In addition, we may not be adequately prepared in contingency planning or recovery capability in relation to a major incident or crisis, and as a result, our operational continuity may be adversely and materially affected, which in turn may harm our reputation.

The recent joint statement by the SEC and PCAOB, proposed rule changes submitted by Nasdaq, and the HFCAA all 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 developments could add uncertainties to our offering.

On April 21, 2020, SEC Chairman Jay Clayton and PCAOB Chairman William D. Duhnke III, along with other senior SEC staff, released a joint statement highlighting the risks associated with investing in companies based in or have substantial operations in emerging markets including China. 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.

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.

On May 20, 2020, the U.S. Senate passed the HFCAA requiring a foreign company to certify it is not owned or controlled by a foreign government if the PCAOB is unable to audit specified reports because the company uses a foreign auditor not subject to PCAOB inspection. If the PCAOB is unable to inspect the company’s auditors for three consecutive years, the issuer’s securities are prohibited to trade on a national securities exchange or in the over the counter trading market in the U.S. On December 2, 2020, the U.S. House of Representatives approved the Holding Foreign Companies Accountable Act. On December 18, 2020, the HFCAA was signed into law.

On March 24, 2021, the SEC announced that it had adopted interim final amendments to implement congressionally mandated submission and disclosure requirements of the HFCAA. In the announcement, the SEC clarifies that before any issuer will have to comply with the interim final amendments, the SEC must implement a process for identifying covered issuers. The announcement also states that the SEC staff is actively assessing how best to implement the other requirements of the HFCAA, including the identification process and the trading prohibition requirements.

On June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act, and on December 29, 2022, legislation entitled “Consolidated Appropriations Act, 2023” was signed into law by President Biden, which contained, among other things, an identical provision to the Accelerating Holding Foreign Companies Accountable Act and amended the HFCAA by requiring the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus reducing the time period for triggering the prohibition on trading.

On September 22, 2021, the PCAOB adopted a final rule implementing the HFCAA, which provides a framework for the PCAOB to use when determining, as contemplated under the HFCAA, whether the PCAOB is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction.

On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions.

On December 16, 2021, the PCAOB issued a report on its determinations that it is unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in mainland China and in Hong Kong, because of positions taken by PRC authorities in those jurisdictions.

On August 26, 2022, the PCAOB announced that it had signed the SOP with the CSRC and the MOF. The SOP Agreement establishes a specific, accountable framework to make possible complete inspections and investigations by the PCAOB of audit firms based in mainland China and Hong Kong, as required under U.S. law. On December 15, 2022, the PCAOB announced that it was able to secure complete access to inspect and investigate PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong completely in 2022. The PCAOB Board vacated its previous 2021 determinations that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong. However, whether the PCAOB will continue to be able to satisfactorily conduct inspections of PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong is subject to uncertainties and depends on a number of factors out of our and our auditor’s control. The PCAOB continues to demand complete access in mainland China and Hong Kong moving forward and was making plans to resume regular inspections in early 2023 and beyond, as well as to continue pursuing ongoing investigations and initiate new investigations as needed. The PCAOB has also indicated that it will act immediately to consider the need to issue new determinations with the HFCAA if needed.

Our auditor, Pan-China Singapore, the independent registered public accounting firm that issued the audit report included in this prospectus, is subject to PCAOB inspections. Pan-China Singapore is headquartered in Singapore and there are no limitations in Singapore on PCAOB inspections. Therefore, the Company believes that, as of the date of this prospectus, its auditor is not subject to the determinations announced by the PCAOB on December 16, 2021 relating to the PCAOB’s inability to inspect or investigate completely registered public accounting firms headquartered in the PRC or Hong Kong because of a position taken by one or more authorities in mainland China or Hong Kong. However, to the extent that the Company’s auditor’s work papers may, in the future, become located in China, such work papers will not be subject to inspection by the PCAOB because the PCAOB is currently unable to conduct inspections without the approval of the Chinese authorities. Inspections of certain other firms that the PCAOB has conducted outside of China have identified deficiencies in those firms’ audit procedures and quality control procedures, which may be addressed as part of the inspection process to improve future audit quality. In addition to subjecting the Company’s securities to the possibility of being prohibited from trading or delisted from a US exchange, the inability of the PCAOB to conduct inspections of the Company’s auditors’ work papers in China would make it more difficult to evaluate the effectiveness of its auditor’s audit procedures or quality control procedures as compared to auditors outside of China that are subject to PCAOB inspections. As a result, the Company’s investors would be deprived of the benefits of the PCAOB’s oversight of its auditor through such inspections and they may lose confidence in the Company’s reported financial information and procedures and the quality of its financial statements. The Company cannot assure you whether Nasdaq or other regulatory authorities will apply additional or more stringent criteria to it. Such uncertainty could cause the market price of the Company’s Ordinary Shares to be materially and adversely affected.

Our Hong Kong subsidiary is currently an intermediate holding company with no business operations. However, the PRC laws and regulations governing businesses in the PRC may also be applicable to our business operations in Hong Kong.

As of the date of this prospectus, our Hong Kong subsidiary is currently an intermediate holding company with no business operations. However, the PRC laws and regulations governing businesses in the PRC may also be applicable to our business operations in Hong Kong. These laws are sometimes vague and uncertain, and as a result, the legal and operational risks of operating in China could extend to businesses operating in Hong Kong, including any future operations of our Hong Kong subsidiary.

We may become subject to a variety of PRC laws and regulations, such as those regarding privacy, data security, cybersecurity, and data protection, which may also apply to any future operations in Hong Kong. These laws and regulations are continuously evolving and developing, and the scope and interpretation of the laws that are or may be applicable to us are often uncertain and may be conflicting, particularly with respect to foreign laws. In particular, there are numerous laws and regulations regarding privacy and the collection, sharing, use, processing, disclosure, and protection of personal information and other user data. Such laws and regulations often vary in scope, may be subject to differing interpretations, and may be inconsistent among different jurisdictions.

The national laws adopted by the PRC are generally not applicable to Hong Kong according to the Basic Law of the Hong Kong Special Administrative Region (the “Basic Law”), which came into effect on July 1, 1997. The Basic Law is the constitutional document of Hong Kong, as it sets out the PRC’s basic policies regarding Hong Kong. The principle of “one country, two systems,” which is a prominent feature of the Basic Law, dictates that Hong Kong will retain its unique common law and capitalist system for 50 years after the handover in 1997. Under the principle of “one country, two systems,” Hong Kong’s legal system, which is different from that of the PRC, is based on the common law supplemented by statutes.

According to Article 18 of the Basic Law, national laws adopted by the PRC shall not be applied in Hong Kong, except for those listed in Annex III to the Basic Law, such as the laws in relation to the national flag, national anthem, and diplomatic privileges and immunities. Further, there is no legislation stating that the laws in Hong Kong should be commensurate with those in the PRC. Despite the foregoing, the legal and operational risks of operating in China could still apply to any future business operations in Hong Kong.

There remains uncertainty as to how the various PRC laws will be interpreted or implemented and whether the PRC regulatory agencies may adopt new laws, regulations, rules, or detailed implementation and interpretation related to various laws, and as to the applicability of PRC laws to any future business operations in Hong Kong. If any such new laws, regulations, rules, or implementation and interpretation come into effect, we will take all reasonable measures and actions to comply and to minimize the adverse effect of such laws on us. However, there can be no assurance that any new PRC laws, regulations, rules, implementation, or interpretation will not have an adverse effect on any future business operations of our Hong Kong subsidiary.

Risks Related to Our Business and Industry

Our HPC server business is dependent on certain major customers and changes or difficulties in our relationships with our major customers may harm our business and financial results.

We had certain HPC server customers whose revenue individually represented 10% or more of the Company’s total revenue, or whose accounts receivable balances individually represented 10% or more of the Company’s total accounts receivable, as follows:

For the six months ended March 31, 2024, one HPC server customer accounted for 10.30% of the Company’s total revenues. For the six months ended March 31, 2023, three HPC server customers accounted for 30.17%, 5.11% and 0.21% of the Company’s total revenues, respectively. Revenues from these customers accounted for 100% and 100% of the HPC server business revenue for the six months ended March 31, 2024 and 2023, respectively.

For the fiscal year ended September 30, 2023, two HPC server customers accounted for 13.02% and 10.23% of the Company’s t total revenues, respectively. For the fiscal year ended September 30, 2022, two HPC server customers accounted for 23.26% and 16.61% of the Company’s total revenues, respectively. Revenues from these customers accounted for 83.9% and 71.8% of the HPC server business revenue for the fiscal years ended September 30, 2023 and 2022, respectively.

For the six months ended March 31, 2024, we entered into a series of standard sales contracts with a major HPC customer for the sales of a total of 1,216 HPC servers for approximately $2.32 million in total. During the year ended September 30, 2023, we entered into a series of standard sales contracts with a major HPC customer for the sales of a total of 2,001 HPC servers for approximately $6.6 million in total. The payments were made 100% in advance, and the products sold were delivered batch by batch over the 12 months after the dates of the contracts pursuant to the contracts. If we cannot maintain long-term relationships with existing major HPC server customers, or develop new HPC server customers from period to period with equivalent terms, the loss of such sales could have an adverse effect on our business, financial condition, and results of operations. In addition, we may not be able to properly identify trends or introduce new products and services to the market as quickly, efficiently, or competitively priced as our competitors. Existing customers may not generate new business for us or make our business uncompetitive with our competitors. If our HPC server customer base decreases, we may not be able to generate sufficient revenue to cover our increased costs and expenses. As a result, our HPC server business and results of operations may be materially and adversely affected.

Our insurance coverage strategy may not be adequate to protect us from all business risks.

We have limited liability insurance coverage for our products and business operations. A successful liability claim against us due to injuries suffered by our customers could materially and adversely affect our financial condition, results of operations and reputation. In addition, we do not have any business disruption insurance. Any business disruption event could result in substantial costs to us and diversion of our resources.

Our customers generally do not place purchase orders far in advance, which makes it difficult for us to predict our future revenues and allocate capacity efficiently and in a timely manner.

Our customers generally do not place firm purchase orders until several weeks before the expected shipment date. There is no assurance that there will not be unexpected decreases in firm orders or subsequent changes to placed orders from our customers. In addition, we incur expenses and adjust inventory levels of raw materials and components based on customers’ forecast, and we may be unable to allocate production capacity in a timely manner to compensate for shortfalls in sales. We expect that, in the future, our sales in any quarter will continue to be dependent substantially upon purchase orders received in that quarter. The inability to adjust production costs, to obtain necessary raw materials and components or to allocate production capacity quickly to respond to the demand for our products may affect our ability to maximize results of operations, which may result in a negative impact on the value of your investment in our Ordinary Shares.

If capital resources required for our planned growth or development are not available, we may be unable to successfully implement our business strategy.

Historically, we have been able to finance our capital expenditures through cash flow from our operating activities and financing activities, including long-term and short-term borrowings. Our ability to expand our production facilities and establish advanced technology manufacturing facilities will continue to largely depend on our ability to obtain sufficient cash flow from operations as well as external funding. We expect to make capital expenditures in connection with the development of our business, including investments in connection with new capacity, technological upgrade and the enhancement of capacity value. These capital expenditures will be made well in advance of any additional sales to be generated from these expenditures. Our results of operations may be affected adversely if we do not have the capital resources to complete our planned growth, or if our actual expenditures exceed planned expenditures for any number of reasons, including changes in:

•        our growth plan and strategy;

•        manufacturing process and product technologies;

•        market conditions;

•        prices of equipment;

•        costs of construction and installation;

•        interest rates and foreign exchange rates; and

•        social, economic, financial, political and other conditions in China and elsewhere.

If adequate funds are not available on satisfactory terms at appropriate times, we may have to curtail our planned growth, which could result in a loss of customers, adversely affect our ability to implement successfully our business strategy and limit the growth of our business.

We operate in a highly competitive environment and we may not be able to sustain our current market position if we fail to compete successfully.

The markets for our products are highly competitive. We experience pressure on our prices and profit margins, due largely to additional and growing industry capacity from competitors in China. The ability to manufacture on a large scale with greater cost efficiencies is a competitive advantage in our industry. Some of our competitors have expanded through mergers and acquisitions. Some of our competitors have greater access to capital and substantially greater production, research and development, intellectual property, marketing and other resources than we do. Some of our competitors have announced their plans to develop, and have already invested substantial resources in new capacity. Our competitors may be able to grasp the market opportunities before us by introducing new products using such capacity. In addition, some of our larger competitors have more extensive intellectual property portfolios than ours, which they may use to their advantage when negotiating cross-licensing agreements for technologies. As a result, these companies may be able to compete more aggressively over a longer period of time than we can.

The principal elements of competition in the solar PV and HPC server industries include:

•        price;

•        product performance features and quality;

•        ability to cater to the customers’ evolving demand;

•        ability to reduce production cost;

•        ability to provide sufficient quantity of products to fulfill customers’ needs;

•        research and development, including the ability to develop new technologies;

•        time-to-market; and

•        access to capital and financing ability.

Our ability to compete successfully in the solar PV and HPC server industries also depends on factors beyond our control, including industry and general political and economic conditions as well as currency fluctuations.

We may encounter difficulties expanding into new businesses or industries, which may affect adversely our results of operations and financial condition.

We may decide to expand into new businesses or industries in the future and may encounter difficulties and face risks in connection with such expansion. We cannot assure you that our expansion into new businesses will be successful, as we may have limited experience in such industries. We cannot assure you that we will be able to generate sufficient profits to justify the costs of expanding into new businesses or industries. Any new business in which we invest or which we intend to develop may require our additional capital investment, research and development efforts, as well as our management’s attention. If such new business does not progress as planned, our results of operations and financial condition may be affected adversely.

We may undertake mergers, acquisitions or investments to diversify or expand our business, which may pose risks to our business and dilute the ownership of our existing shareholders, and we may not realize the anticipated benefits of these mergers, acquisition or investments.

We may evaluate opportunities to acquire or invest in other businesses or existing businesses, intellectual property or technologies and expand the breadth of markets we can address or enhance our technical capabilities. Mergers, investments or acquisitions that we may enter into in the future entail a number of risks that could materially and adversely affect our business, operating and financial results, including, among others:

•        problems integrating the acquired operations, technologies or products into our existing business and products;

•        diversion of management’s time and attention from our core business;

•        conflicts with joint venture partners;

•        adverse effect on our existing business relationships with customers;

•        need for financial resources above our planned investment levels;

•        failures in realizing anticipated synergies;

•        difficulties in retaining business relationships with suppliers and customers of the acquired company;

•        risks associated with entering markets in which we lack experience;

•        potential loss of key employees of the acquired company; and

•        potential write-offs of acquired assets.

Our failure to address these risks successfully may have a material adverse effect on our financial condition and results of operations. Any such acquisition or investment will likely require a significant amount of capital investment, which would decrease the amount of cash available for working capital or capital expenditures. In addition, if we borrow funds to finance acquisitions, such debt instruments may contain restrictive covenants that can, among other things, restrict us from distributing dividends.

If we fail to retain our key personnel or if we fail to attract additional qualified personnel, we may not be able to achieve our anticipated level of growth and our business could suffer.

Our future success and ability to implement our business strategy depends, in part, on our ability to attract and retain key personnel, and on the continued contributions of members of our senior management team and key technical personnel, each of whom would be difficult to replace. All of our employees, including our senior management, are free to terminate their employment relationships with us at any time. Competition for highly skilled individuals with technical expertise is extremely intense, and we face challenges of identifying, hiring and retaining qualified personnel in many areas of our business. Integrating new employees into our team could prove disruptive to our operating subsidiaries’ operations, require substantial resources and management attention and ultimately prove unsuccessful. An inability to retain our senior management and other key personnel or to attract additional qualified personnel could limit or delay our strategic efforts, which could have a material adverse effect on our business, financial condition, results of operations and prospects.

We may not be able to adequately protect and maintain our intellectual property.

Our success will depend on our ability to continue to develop and market our products. We have been granted 47 patents, 33 trademarks, 25 copyrights, and 1 domain name in China relating to our products. No assurance can be given that such patents will not be challenged, invalidated, infringed or circumvented, or that such intellectual property rights will provide a competitive advantage to us. Also, litigation may be necessary to enforce our intellectual property rights or determine the validity and scope of the proprietary rights of others. The outcome of such potential litigation may not be in our favor and any success in litigation may not be able to adequately protect our rights. Such litigation may be costly and divert management attention away from our business. An adverse determination in any such litigation would impair our intellectual property rights and may harm our business, prospects and reputation. Enforcement of judgments in China is uncertain and even if we are successful in such litigation, it may not provide us with an effective remedy.

Other technology development in solar PV products could render our products uncompetitive or obsolete.

We currently manufacture solar PV products primarily using mechanical and semi-automated technology, which are currently the most commonly used manufacturing technologies. We may face competition from solar PV product manufacturers utilizing alternative fully automated technologies. In addition, new materials may, in the future, gain wider market acceptance than traditional materials for application in certain solar energy solutions, such as new conductive materials and outdoor durable plastic raw materials. Failure to further refine our mechanical technology or any other alternative technology could render our products uncompetitive or obsolete, which in turn could cause our sales and revenues to decline. Moreover, if the various alternative fully automated technologies currently commercially available or in the research and development stage are developed to have better performance-to-price ratios and begin

mass production, such technologies may pose a great challenge to cost-effective power transmission. Even though we seek to remain competitive through research and development, we may invest in research and development in certain technologies that do not come to fruition.

If we cannot successfully introduce, develop or acquire advanced technologies, our profitability may suffer.

Technology and industry standards in the solar PV industry evolve quickly, resulting in steep price declines in the advanced stages of a product’s life cycle. To remain competitive, we must develop or acquire advanced manufacturing process technologies and build advanced technology manufacturing plants to lower production costs and enable the timely release of new products. Our ability to manufacture products by utilizing more advanced manufacturing process technologies to increase production efficiency will be critical to our sustained competitiveness. We may undertake in the future a number of significant capital expenditures for advanced technology manufacturing facilities and new capacity subject to market demand and our overall business strategy. However, we cannot assure you that we will be successful in completing our planned growth or in the development of other future technologies for our advanced technology manufacturing plants, or that we will be able to complete them without material delays or at the expected costs. If we fail to do so, our results of operations and financial condition may be materially and adversely affected. We also cannot assure you that there will be no material delays in connection with our efforts to develop new technology and manufacture more technologically advanced products. If we fail to develop or make advancements in product technologies or manufacturing process technologies on a timely basis, we may become less competitive.

Our business has been and may continue to be affected by the outbreak of COVID-19.

The COVID-19 pandemic has somehow affected our business. We have been gradually recovering from the delay in commencement of operations in China since the beginning of March 2020. Even though our business is currently operational, our operating efficiency and capacity may still be adversely affected by the COVID-19 pandemic mainly due to the necessity to comply with disease control protocols in business facilities and hospitals. The global spread of COVID-19 pandemic in major countries of the world may also result in global economic distress, and the extent to which it may affect our results of operations will depend on future developments of the COVID-19 pandemic, which are highly uncertain and difficult to predict. There may be potential impacts on our results of operations if the pandemic and the resulting disruption were to extend over a prolonged period.

Though the impact of COVID-19 came to an end in November 2022, and there has been no indication of another outbreak of COVID-19 so far, given the uncertainty of the future development of the COVID-19 pandemic, we believe there is a risk that our business, results of operations, and financial condition will be adversely affected. Potential impact on our results of operations will also depend on future developments and new information that may emerge regarding the duration and severity of the possible outbreak of the COVID-19 pandemic and the actions taken by government authorities and other entities to contain the COVID-19 pandemic or mitigate its impact, almost all of which are beyond our control.

If demand for our products does not continue to grow or grows at a slower rate than we anticipate, our solar PV products and HPC servers businesses will suffer.

Our future success depends on continued demand for our products and the ability to meet this demand. The solar PV industry and HPC server industry are evolving industries that have experienced substantial changes in recent years, and we cannot be certain that consumers and businesses will continue to choose our products at levels sufficient to grow our business. Suppose the demand for solar energy or HPC servers fails to develop sufficiently, demand for our products will decrease, which would have an adverse impact on our ability to increase our revenue and grow our business.

Existing electric utility industry policies and regulations, and any subsequent changes, may present technical, regulatory and economic barriers to the purchase and use of solar energy systems that may significantly reduce demand for our products or harm our ability to compete.

Chinese and foreign government regulations and policies concerning the broader electric utility industry, as well as internal policies and regulations promulgated by electric utilities and organized electric markets with respect to fees, practices, and rate design, heavily influence the market for electricity generation products and services. These regulations and policies often affect electricity pricing and the interconnection of generation facilities, and can be subject to frequent modifications by governments, regulatory bodies, utilities and market operators. For example, changes in

fee structures, electricity pricing structures, and system permitting, interconnection and operating requirements can deter purchases of renewable energy products, including solar energy systems, by reducing anticipated revenues or increasing costs or regulatory burdens for would-be system purchasers. The resulting reductions in demand for solar energy systems could harm our business, prospects, financial condition and results of operations.

Changes in other current laws or regulations applicable to us or the imposition of new laws, regulations or policies in China, Southeast Asia, or other jurisdictions in which we do business could have a material adverse effect on our business, financial condition and results of operations. Any changes to government, utility or electric market regulations or policies that favor electric utilities, non-solar generation, or other market participants, or that make construction or operation of new solar generation facilities more expensive or difficult, could reduce the competitiveness of solar energy systems and cause a significant reduction in demand for our products and services and adversely impact our growth. In addition, changes in our products or changes in export and import laws and implementing regulations may create delays in the introduction of new products in international markets, prevent our customers from deploying our products internationally or, in some cases, prevent the export or import of our products to certain countries altogether. Any such event could have a material adverse effect on our business, financial condition and results of operations.

A drop in the price of electricity sold may harm our business, financial condition, results of operations and prospects.

Decreases in the price of electricity, whether in organized electric markets or with contract counterparties, may negatively impact the owners of the solar energy projects or make the purchase of solar energy systems less economically attractive and would likely lower sales of our solar PV products. The price of electricity could decrease as a result of:

•        construction of a significant number of new, lower-cost power generation plants, including plants utilizing natural gas, renewable energy or other generation technologies;

•        relief of transmission constraints that enable distant, lower-cost generation to transmit energy less expensively or in greater quantities;

•        reductions in the price of natural gas or other fuels;

•        utility rate adjustment and customer class cost reallocation;

•        decreased electricity demand, including from energy conservation technologies and public initiatives to reduce electricity consumption;

•        development of smart-grid technologies that lower the peak energy requirements;

•        development of new or lower-cost customer-sited energy storage technologies that have the ability to reduce a customer’s average cost of electricity by shifting load to off-peak times; and

•        development of new energy generation technologies that provide less expensive energy.

If the cost of electricity generated by solar energy installations incorporating our products is high relative to the cost of electricity from other sources, then our business, financial condition and results of operations may be harmed.

We may incur obligations, liabilities or costs under environmental, health and safety laws, which could have an adverse impact on our business, financial condition and results of operations.

We are required to comply with PRC laws and regulations regarding the protection of the environment and health and safety. Adoption of more stringent laws and regulations in the future could require us to incur substantial costs to come into compliance with these laws and regulations. In addition, violations of, or liabilities under, these laws and regulations may result in restrictions being imposed on our operating activities or in our being subject to adverse publicity, substantial fines, penalties, criminal proceedings, third-party property damage or personal injury claims, cleanup costs, or other costs. We may become liable under certain of these laws and regulations for costs to investigate or remediate contamination if any at properties we own or operate. Liability under these laws and regulations can be imposed on a joint and several bases and without regard to fault or the legality of the activities giving rise to the contamination conditions. In addition, future developments such as more aggressive enforcement policies or the discovery of presently unknown environmental conditions may require expenditures that could have an adverse effect on our business, financial condition, and results of operations.

The requirements of being a public company may strain our resources, divert management’s attention and affect our ability to attract and retain qualified board members and officers.

As a public company, we will be subject to the reporting requirements of the Exchange Act, the listing requirements of Nasdaq, and other applicable securities rules and regulations. Compliance with these rules and regulations will increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources. The Exchange Act requires, among other things, that we file annual, quarterly and current reports with respect to our business and results of operations and maintain effective disclosure controls and procedures and internal control over financial reporting. To maintain and, if required, improve our disclosure controls and procedures and internal control over financial reporting to meet this standard, significant resources and management oversight may be required. As a result, management’s attention may be diverted from other business concerns, which could harm our business and results of operations. We may need to hire more employees in the future which would increase our costs and expenses.

The disruption of supply or shortage of components and materials could increase our cost of revenues and adversely affect our business, financial condition, and results of operation.

We may experience supply interruption and/or shortages relating to components and raw materials, which could materially and adversely impact our business, prospects, financial condition and operating results. We use various components and raw materials in our business, such as servers, photovoltaic cable, and photovoltaic connectors. While we have not in the past experienced material fluctuations or volatility in the cost of raw materials required to make our products, we may in the future experience such fluctuations, including for reasons beyond our control. Factors affecting supply and price include variables such as competition, supply and distribution challenges, customer demand, governmental policies and other factors that are generally unpredictable and beyond our control, among others, any of which could adversely affect our business and operating results. Any attempts by us to increase our product prices in response to supply interruption could result in decrease in sales and therefore materially and adversely affect our brand, image, business, prospects and operating results.

We have engaged in the past in related party transactions, which may result in adverse effects to our business, financial condition and results of operations.

We have engaged in the past in related party transactions, making loans to certain of our executive officers and directors, and BVI shareholders. Specifically, as of September 30, 2024 and September 30, 2023, $2,552,589 and $4,143,833 were due from related parties, respectively. Among these, $2,431,198 and $4,025,295 were due from Weiqi Huang, our Chairman of the Board of Directors and Chief Executive Officer. As of the date of this prospectus, the remaining balance due from Weiqi Huang is nil. See “Related Party Transactions” for additional information.

Related party transactions may present conflicts of interest, could result in disadvantages to our Company, and may impair investor confidence. Related party transactions could also cause us to become materially dependent on related parties in the ongoing conduct of our business, and related parties may be motivated by personal interests to pursue courses of action that are not necessarily in the best interests of our Company and our shareholders. Further, the appearance of conflicts of interest created by related party transactions could impair the confidence of our investors. Our affiliates may economically benefit from our arrangements with related parties. If we engage in related party transactions on unfavorable terms, our business, financial condition, and results of operations may be negatively impacted.

Risks Related to this Offering and Ownership of our Ordinary Shares

An active trading market for our Ordinary Shares or our Ordinary Shares may not develop and the trading price for our Ordinary Shares may fluctuate significantly.

We have applied to list our Ordinary Shares on the Nasdaq. At this time, Nasdaq has not yet approved our application to list our Ordinary Shares. Prior to the completion of this offering, there has been no public market for our Ordinary Shares, and we cannot assure you that a liquid public market for our Ordinary Shares will develop. If an active public market for our Ordinary Shares does not develop following the completion of this offering, the market price and liquidity of our Ordinary Shares may be materially and adversely affected. The initial public offering price

for our Ordinary Shares was determined by negotiation between us and the underwriters based upon several factors, and we can provide no assurance that the trading price of our Ordinary Shares after this offering will not decline below the initial public offering price. As a result, investors in our securities may experience a significant decrease in the value of their Ordinary Shares.

The trading price of our Ordinary Shares may be volatile, which could result in substantial losses to investors.

The trading price of our Ordinary Shares may be volatile and could fluctuate widely due to factors beyond our control. This may happen because of the broad market and industry factors, like the performance and fluctuation of the market prices of other companies with business operations located mainly in China that have listed their securities in the United States. A number of Chinese companies have listed or are in the process of listing their securities on U.S. stock markets. The securities of some of these companies have experienced significant volatility, including price declines in connection with their initial public offerings. The trading performance of these Chinese companies’ securities after their offerings may affect the attitudes of investors toward Chinese companies listed in the United States in general and consequently may impact the trading performance of our Ordinary Shares, regardless of our actual operating performance.

In addition to market and industry factors, the price and trading volume for our Ordinary Shares may be highly volatile for factors specific to our own operations, including the following:

•        regulatory developments affecting us or our industry;

•        actual or anticipated fluctuations in our quarterly results of operations and changes or revisions of our expected results;

•        changes in financial estimates by securities research analysts;

•        conditions in the market for hash power sever and solar PV products;

•        announcements by us or our competitors of new product and service offerings, acquisitions, strategic relationships, joint ventures, capital raisings or capital commitments;

•        additions to or departures of our senior management;

•        fluctuations of exchange rates between the Renminbi and the U.S. dollar;

•        release or expiry of lock-up or other transfer restrictions on our outstanding shares;

•        negative publicity regarding Chinese listed companies; and

•        sales or perceived potential sales of additional Ordinary Shares.

Any of these factors may result in large and sudden changes in the volume and price at which our Ordinary Shares will trade.

In the past, shareholders of public companies have often brought securities class action suits against those companies following periods of instability in the market price of their securities. If we were involved in a class action suit, it could divert a significant amount of our management’s attention and other resources from our business and operations and require us to incur significant expenses to defend the suit, which could harm our results of operations. Any such class action suit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations.

If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our Ordinary Shares, the market price for our Ordinary Shares and trading volume could decline.

The trading market for our Ordinary Shares will be influenced by research or reports that industry or securities analysts publish about our business. If one or more analysts who cover us downgrade our Ordinary Shares, the market price for our Ordinary Shares would likely decline. If one or more of these analysts cease to cover us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause the market price or trading volume for our Ordinary Shares to decline.

The sale or availability for sale of substantial amounts of our Ordinary Shares could adversely affect their market price.

Sales of substantial amounts of our Ordinary Shares in the public market after the completion of this offering, or the perception that these sales could occur, could adversely affect the market price of our Ordinary Shares and could materially impair our ability to raise capital through equity offerings in the future. The Ordinary Shares sold in this offering will be freely tradable without restriction or further registration under the Securities Act, and shares held by our existing shareholders may also be sold in the public market in the future subject to the restrictions in Rule 144 under the Securities Act and the applicable lock-up agreements. Following the consummation of our initial public offering, there will be 27,700,000 Ordinary Shares outstanding immediately after this offering or 28,105,000 Ordinary Shares assuming the full exercise of the Representative’s over-allotment option. In connection with this offering, we and each of our directors and officers named in the section “Management,” and certain shareholders have agreed not to sell any Ordinary Shares for six (6) months from the effectiveness of this prospectus without the prior written consent of the underwriter, subject to certain exceptions. However, the underwriters may release these securities from these restrictions at any time, subject to applicable regulations of the Financial Industry Regulatory Authority, Inc. (“FINRA”). We cannot predict what effect, if any, market sales of securities held by our significant shareholders or any other shareholder or the availability of these securities for future sale will have on the market price of our Ordinary Shares. See “Underwriting” and “Shares Eligible for Future Sale” for a more detailed description of the restrictions on selling our securities after this offering.

Because we do not expect to pay dividends in the foreseeable future after this offering, you must rely on price appreciation of our Ordinary Shares for return on your investment.

We currently intend to retain all of our available funds and any future earnings after this offering to fund the development and growth of our business. As a result, we do not expect to pay any cash dividends in the foreseeable future. Therefore, you should not rely on an investment in our Ordinary Shares as a source for any future dividend income.

Our board of directors has complete discretion as to whether to distribute dividends, subject to certain requirements of Cayman Islands law. In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our directors. Under Cayman Islands law, a Cayman Islands company may pay a dividend out of either profit or share premium account, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts as they fall due in the ordinary course of business. Even if our board of directors decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors. Accordingly, the return on your investment in our Ordinary Shares will likely depend entirely upon any future price appreciation of our Ordinary Shares. There is no guarantee that our Ordinary Shares will appreciate in value after this offering or even maintain the price at which you purchased our Ordinary Shares. You may not realize a return on your investment in our Ordinary Shares and you may even lose your entire investment.

Because the initial public offering price is substantially higher than the pro forma net tangible book value per share, you will experience immediate and substantial dilution.

If you purchase Ordinary Shares in this offering, you will pay more for each share than the corresponding amount paid by existing shareholders for their Ordinary Shares. As a result, you will experience immediate and substantial dilution of $3.12 per share, representing the difference between our net tangible book value per share of $0.88 as of March 31, 2024, after giving effect to this offering and an assumed initial public offering price of $4.00 per share, the low point of the range set forth on the cover page of this prospectus. See “Dilution” for a more complete description of how the value of your investment in our Ordinary Shares will be diluted upon the completion of this offering.

You must rely on the judgment of our management as to the use of the net proceeds from this offering, and such use may not produce income or increase our share price.

We plan to use the net proceeds of this offering primarily for expanding product lines and services, strengthening research and development capabilities, improving brand recognition through multi-channel marketing, and working capital and general corporate matters. See “Use of Proceeds.” However, our management will have considerable discretion in the application of the net proceeds received by us. You will not have the opportunity, as part of your

investment decision, to assess whether proceeds are being used appropriately. The net proceeds may be used for corporate purposes that do not improve our efforts to achieve or maintain profitability or increase our share price. The net proceeds from this offering may be placed in investments that do not produce income or that lose value.

If we are classified as a passive foreign investment company, United States taxpayers who own our Ordinary Shares may have adverse United States federal income tax consequences.

A non-U.S. corporation such as ourselves will be classified as a passive foreign investment company, which is known as a PFIC, for any taxable year if, for such year, either

•        At least 75% of our gross income for the year is passive income; or

•        The average percentage of our assets (determined at the end of each quarter) during the taxable year which produces passive income or which are held for the production of passive income is at least 50%.

Passive income generally includes dividends, interest, rents, royalties (other than rents or royalties derived from the active conduct of a trade or business) and gains from the disposition of passive assets.

If we are determined to be a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. taxpayer who holds our Ordinary Shares, the U.S. taxpayer may be subject to increased U.S. federal income tax liability and may be subject to additional reporting requirements.

Depending on the amount of cash we raise in this offering, together with any other assets held for the production of passive income, it is possible that, for our current taxable year or for any subsequent year, more than 50% of our assets may be assets which produce passive income. We will make this determination following the end of any particular tax year. For purposes of the PFIC analysis, in general, a non-U.S. corporation is deemed to own its pro rata share of the gross income and assets of any entity in which it is considered to own at least 25% of the equity by value.

For a more detailed discussion of the application of the PFIC rules to us and the consequences to U.S. taxpayers if we were determined to be a PFIC, see “Taxation — Material United States Federal Income Tax Considerations — Passive Foreign Investment Company.”

You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law.

We are an exempted company incorporated under the laws of the Cayman Islands with limited liability. Our corporate affairs are governed by our memorandum and articles of association, the Companies Act (As Revised) of the Cayman Islands and the common law of the Cayman Islands. The rights of shareholders to take action against the directors, actions by minority shareholders and the fiduciary duties of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from the common law of England, the decisions of whose courts are of persuasive authority, but are not binding, on a court in the Cayman Islands. The rights of our shareholders and the fiduciary duties of our directors under Cayman Islands law are not as clearly established as they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a less developed body of securities laws than the United States. Some U.S. states, such as Delaware, have more fully developed and judicially interpreted bodies of corporate law than the Cayman Islands. In addition, Cayman Islands companies may not have the standing to initiate a shareholder derivative action in a federal court of the United States.

Shareholders of Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records or to obtain copies of the register of members of these companies. Our directors have discretion under our articles of association to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.

Certain corporate governance practices in the Cayman Islands, which is our home country, differ significantly from requirements for companies incorporated in other jurisdictions such as the U.S. Currently, we do not plan to rely on home country practice with respect to any corporate governance matter. However, if we choose to follow our home country practice in the future, our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to U.S. domestic issuers.

As a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by our management, members of the board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States. For a discussion of significant differences between the provisions of the Companies Act of the Cayman Islands and the laws applicable to companies incorporated in the United States and their shareholders, see “Description of Share Capital.”

You may be unable to present proposals before annual general meetings or extraordinary general meetings not called by shareholders.

Cayman Islands law provides shareholders with only limited rights to requisition a general meeting, and does not provide shareholders with any right to put any proposal before a general meeting. These rights, however, may be provided in a company’s articles of association. Our articles of association allow one or more of our shareholders holding shares together representing in aggregate at least 10% of the rights to vote at such general meeting, to requisition a general meeting of our shareholders and the requisition must be in writing, in which case our directors are obliged to call such meeting. Advance notice of at least seven clear days is required for the convening of a general meeting. A quorum required for a general meeting is (a) if the Company has only one member: that member; (b) if the Company has more than one member, one or more members holding shares that represent not less than one-third of the outstanding shares carrying the right to vote at such general meeting present in person or by proxy or if a corporation or other non-natural person by its duly authorized representative or proxy. For these purposes, “clear days” means that period of calendar days excluding (a) the calendar day when the notice is given or deemed to be given and (b) the calendar day for which it is given or on which it is to take effect.

Newly enacted Economic Substance Legislation in the Cayman Islands may have an impact on the Company.

Pursuant to the International Tax Cooperation (Economic Substance) Act, 2018 of the Cayman Islands, or the ES Act, that came into force on January 1, 2019, a “relevant entity” is required to satisfy the economic substance test set out in the ES Act. A “relevant entity” includes an exempted company incorporated in the Cayman Islands as is our Company. Based on the current interpretation of the ES Act, we believe that our Company is a pure equity holding company since it only holds equity participation in other entities and only earns dividends and capital gains. Accordingly, for so long as our Company is a “pure equity holding company,” it is only subject to the minimum substance requirements, which require us to (i) comply with all applicable filing requirements under the Companies Act; and (ii) has adequate human resources and adequate premises in the Cayman Islands for holding and managing equity participations in other entities. However, there can be no assurance that we will not be subject to more requirements under the ES Act. Uncertainties over the interpretation and implementation of the ES Act may have an adverse impact on our business and operations.

Certain judgments obtained against us by our shareholders may not be enforceable.

We are a Cayman Islands exempted company and all of our assets are located outside of the United States. All of our current operations are conducted in the PRC. In addition, all of our current directors and officers are located in the PRC. Substantially all of the assets of these persons are located outside the United States. As a result, it may be difficult or impossible for you to bring an action against us or against these individuals in the United States in the event that you believe that your rights have been infringed under the U.S. federal securities laws or otherwise. Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands and of the PRC may render you unable to enforce a judgment against our assets or the assets of our directors and officers. For more information regarding the relevant laws of the Cayman Islands and the PRC, see “Enforceability of Civil Liabilities.”

We are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements.

We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from requirements applicable to other public companies that are not emerging growth companies including, most significantly, not being required to comply with the auditor attestation requirements of Section 404 for so long as we are an emerging growth company.

The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the extended transition period. As a result of this election, our future financial statements may not be comparable to other public companies that comply with the public company effective dates for these new or revised accounting standards.

We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable to United States domestic public companies.

Because we are a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including:

•        the rules under the Exchange Act requiring the filing of quarterly reports on Form 10-Q or current reports on Form 8-K with the SEC;

•        the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act;

•        the sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and

•        the selective disclosure rules by issuers of material non-public information under Regulation FD.

We will be required to file an annual report on Form 20-F within four months of the end of each fiscal year. In addition, we intend to publish our results on a semi-annual basis through press releases, distributed pursuant to the rules and regulations of the Nasdaq Capital Market. Press releases relating to financial results and material events will also be furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC will be less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers. As a result, you may not be afforded the same protections or information, which would be made available to you, were you investing in a U.S. domestic issuer.

We will incur significantly increased costs and devote substantial management time as a result of the listing of our Ordinary Shares.

We will incur additional legal, accounting and other expenses as a public reporting company, particularly after we cease to qualify as an emerging growth company. For example, we will be required to comply with the additional requirements of the rules and regulations of the SEC and the Nasdaq rules, including applicable corporate governance practices. We expect that compliance with these requirements will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. In addition, we expect that our management and other personnel will need to divert attention from operational and other business matters to devote substantial time to these public company requirements. We cannot predict or estimate the number of additional costs we may incur as a result of becoming a public company or the timing of such costs.

In addition, changing laws, regulations and standards relating to corporate governance and public disclosure are creating uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time-consuming. These laws, regulations and standards are subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidelines

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements that reflect our current expectations and views of future events. The forward-looking statements are contained principally in the sections entitled “Prospectus Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Our Business” and “Regulation.” Known and unknown risks, uncertainties and other factors, including those listed under “Risk Factors,” may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements.

You can identify some of these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to,” “potential,” “continue” or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements include statements relating to:

•        the expected or potential impact of the COVID-19 pandemic, and the related responses of the government, consumers, and the Company, on our business, financial condition and results of operations;

•        our dependence on growth in the demand for our products;

•        our ability to compete effectively;

•        our dependence on a small number of customers for a substantial portion of our net revenue;

•        our ability to successfully manage our capacity expansion and allocation in response to changing industry and market conditions;

•        implementation of our expansion plans and our ability to obtain capital resources for our planned growth;

•        our ability to acquire sufficient raw materials and obtain equipment and services from our suppliers in suitable quantity and quality;

•        our dependence on key personnel;

•        our ability to expand into new businesses, industries or internationally and to undertake mergers, acquisitions, investments or divestments;

•        changes in technology and competing products;

•        general economic and political conditions, including those related to the new energy industry;

•        possible disruptions in commercial activities caused by events such as natural disasters, terrorist activity;

•        fluctuations in foreign currency exchange rates; and

•        other factors in the “Risk Factors” section in this prospectus.

These forward-looking statements are subject to various and significant risks and uncertainties, including those which are beyond our control. Although we believe that our expectations expressed in these forward-looking statements are reasonable, our expectations may later be found to be incorrect. The forward-looking statements made in this prospectus relate only to events or information as of the date on which the statements are made in this prospectus. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. You should thoroughly read this prospectus and the documents that we refer to herein with the understanding that our actual future results may be materially different from and worse than what we expect. We qualify all of our forward-looking statements by these cautionary statements. We disclaim any obligation to update our forward-looking statements, except as required by law.

This prospectus contains certain data and information that we obtained from various Chinese government and private publications, including industry data and information from Mordor Intelligence, Expert Market Research, Emergen Research, GlobalData, Hyperion Research, SolarPower Europe, and China Photovoltaic Industry Association, etc. Statistical data in these publications also include projections based on a number of assumptions.

In addition, the new and rapidly changing nature of the Solar PV Energy and HPC Server industries results in significant uncertainties for any projections or estimates relating to the growth prospects or future condition of our industry. Furthermore, if any one or more of the assumptions underlying the market data are later found to be incorrect, actual results may differ from the projections based on these assumptions. You should not place undue reliance on these forward-looking statements.

USE OF PROCEEDS

We estimate that we will receive net proceeds from this offering of approximately $8,509,014 after deducting estimated underwriting discounts, the non-accountable expense allowance and the estimated offering expenses payable by us, and based upon an assumed initial offering price of $4.00 per Ordinary Share, the low point of the range set forth on the cover page of this prospectus (excluding any exercise of the Representative’s over-allotment option).

We plan to use the net proceeds from this offering as follows:

The foregoing represents our current intentions based upon our present plans and business conditions to use and allocate the net proceeds of this offering. Our management, however, will have significant flexibility and discretion to apply the net proceeds of this offering. If an unforeseen event occurs or business conditions change, we may use the proceeds of this offering differently than as described in this prospectus.

In utilizing the proceeds from this offering, we are permitted under PRC laws and regulations to provide funding to PRC subsidiaries only through loans or capital contributions, and only if we satisfy the applicable government registration and approval requirements. The relevant filing and registration processes for capital contributions typically take approximately eight weeks to complete. The filing and registration processes for loans typically take approximately four weeks or longer to complete. While we currently see no material obstacles to completing the filing and registration procedures with respect to future capital contributions and loans to PRC subsidiaries, we cannot assure you that we will be able to complete these filings and registrations on a timely basis, or at all. We cannot assure you that we will be able to meet these requirements on a timely basis, if at all. See “Risk Factors — Risks Related to Doing Business in China — PRC regulations on loans to and direct investment in PRC entities by offshore holding companies may delay or prevent us from making loans or additional capital contributions to our PRC operating subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.”

Pending use of the net proceeds, we intend to hold our net proceeds in short-term, interest-bearing, financial instruments or demand deposits.

DIVIDEND POLICY

Our board of directors has complete discretion in deciding whether to distribute dividends, subject to certain restrictions under Cayman Islands law, namely that our company may only pay dividends out of profits or share premium, and provided always that in no circumstances may a dividend be paid if this would result in our company being unable to pay its debts as they fall due in the ordinary course of business. In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our board of directors. Even if our board of directors decides to pay dividends, the form, frequency and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors that the board of directors may deem relevant.

We have never declared or paid cash dividends on our shares. We currently do not have any plans to pay cash dividends. Rather, we currently intend to retain all of our available funds and any future earnings to operate and grow our business.

Cash dividends on our Ordinary Shares, if any, will be paid in U.S. dollars.

CAPITALIZATION

The following table sets forth our cash and cash equivalents and our capitalization as of March 31, 2024 as follows:

•        on an actual basis;

•        on an adjusted basis to reflect the sale of 2,700,000 Ordinary Shares in this offering (without exercise of the Representative’s over-allotment option), at an assumed initial public offering price of $4.00 per share, the low point of the range set forth on the cover page of this prospectus, after deducting the underwriting discounts, non-accountable expense allowance and estimated offering expenses payable by us; and

•        on an adjusted basis to reflect the sale of 3,105,000 Ordinary Shares (with full exercise of the Representative’s over-allotment option) in this offering, at an assumed initial public offering price of $4.00 per share, the low point of the range set forth on the cover page of this prospectus, after deducting the underwriting discounts, non-accountable expense allowance and estimated offering expenses payable by us.

The adjustments reflected below are subject to change and are based upon available information and certain assumptions that we believe are reasonable. Total shareholders’ equity and total capitalization following the completion of this offering are subject to adjustment based on the actual initial public offering price and other terms of this offering determined at pricing. You should read this capitalization table in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the related notes appearing elsewhere in this prospectus.

____________

(1)      Reflects the sale of Ordinary Shares in this offering (excluding any Ordinary Shares that may be sold pursuant to the Representative’s over-allotment option) at an assumed initial public offering price of $4.00 per share, the low point of the range set forth on the cover page of this prospectus, and after deducting the estimated underwriting discounts, non-accountable expense allowance and estimated offering expenses payable by us. The pro forma as adjusted information

____________

is illustrative only, and we will adjust this information based on the actual initial public offering price and other terms of this offering determined at pricing. Additional paid-in capital reflects the net proceeds we expect to receive, after deducting the underwriting discounts and estimated offering expenses payable by us. Based on the assumed offering price of $4.00 per Ordinary Share, the low point of the range set forth on the cover page of this prospectus, we estimate that such net proceeds will be approximately $8,509,014 assuming no exercise of the over-allotment option and $9,999,414 assuming full exercise of the over-allotment option.

(2)      Retroactively adjusted to reflect the share split completed on October 21, 2024.

Each $1.00 increase (decrease) in the assumed initial public offering price of $4.00 per Ordinary Share, the low end of the range set forth on the cover page of this prospectus, would increase (decrease) the pro forma as adjusted amount of total capitalization by approximately $2.48 million, assuming that the number of Ordinary Shares offered by us, as set forth on the cover page of this prospectus, remains the same, and after deducting the underwriting discounts, non-accountable expense allowance and estimated offering expenses (including underwriter’s accountable expenses) payable by us. An increase (decrease) of 1 million in the number of our Ordinary Shares offered by us, as set forth on the cover page of this prospectus, would increase (decrease) the pro forma as adjusted amount of total capitalization by approximately $3.68 million, assuming no change in the assumed initial public offering price per Ordinary Share as set forth on the cover page of this prospectus.

ENFORCEABILITY OF CIVIL LIABILITIES

We were incorporated in the Cayman Islands in order to enjoy the following benefits:

•        political and economic stability;

•        an effective judicial system;

•        a favorable tax system;

•        the absence of exchange control or currency restrictions; and

•        the availability of professional and support services.

However, certain disadvantages accompany incorporation in the Cayman Islands. These disadvantages include, but are not limited to, the following:

•        the Cayman Islands has a less developed body of securities laws as compared to the United States and these securities laws provide significantly less protection to investors; and

•        Cayman Islands companies may not have the standing to sue before the federal courts of the United States.

Our constitutional documents do not contain provisions requiring that disputes, including those arising under the securities laws of the United States, between us, our officers, directors and shareholders, be arbitrated. Currently, substantially all of our operating subsidiaries’ operations are conducted outside the United States, and substantially all of our assets are located outside the United States. All of our officers are nationals or residents of jurisdictions other than the United States and a substantial portion of their assets are located outside the United States. As a result, it may be inconvenient for a shareholder to effect service of process within the United States upon these persons, or to enforce against us or them judgments obtained in United States courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States.

We have appointed Cogency Global Inc., as our agent upon whom process may be served in any action brought against us under the securities laws of the United States.

Ogier, our counsel as to Cayman Islands law has advised us, respectively, that there is uncertainty as to whether the courts of the Cayman Islands would:

•        recognize or enforce judgments of United States courts obtained against us predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States; or

•        entertain original actions brought in each respective jurisdiction against us or our directors or officers predicated upon the securities laws of the United States or any state in the United States.

Enforcement of Judgments/Enforcement of Civil Liabilities

We have been advised by our Cayman Islands legal counsel, Ogier, that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the securities laws of the United States or any State; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the securities laws of the United States or any State, so far as the liabilities imposed by those provisions are penal in nature. In those circumstances, although there is no statutory enforcement in the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will in certain circumstances recognize and enforce a foreign judgment of a foreign court of competent jurisdiction without any re-examination or re-litigation of matters adjudicated upon, provided such judgment: (a) is given by a foreign court of competent jurisdiction; (b) imposes on the judgment debtor a liability to pay a liquidated sum for which the judgment has been given; (c) is final; (d) is not in respect of taxes, a fine or a penalty; (e) was not obtained by fraud; and (f) is not of a kind the enforcement of which is contrary to natural justice or the public policy of the Cayman Islands. Subject to the above limitations, in appropriate circumstances, a Cayman Islands court may give effect in the Cayman Islands to other kinds of final foreign judgments such as declaratory orders, orders for performance of contracts and injunctions.

We have been advised by our PRC counsel, Jiangsu Junjin Law Firm, that the recognition and enforcement of foreign judgments are provided for under the PRC Civil Procedure Law. PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedure Law based either on treaties between China and the country where the judgment is made or on reciprocity between different jurisdictions, and PRC courts will not recognize or enforce these foreign judgments if PRC courts believe the foreign judgments violate the basic principles of PRC laws or national sovereignty, security or public interest after review. However, currently, China does not have treaties or reciprocity arrangement providing for recognition and enforcement of foreign judgments ruled by courts in the United States or the Cayman Islands. Thus, it is uncertain whether a PRC court would enforce a judgment ruled by a court in the United States or the Cayman Islands.

Hong Kong

Judgment of United States courts cannot be directly enforced in Hong Kong in accordance with the Foreign Judgments (Reciprocal Enforcement) Ordinance (Cap. 319) (the “Ordinance”), as the application of the Ordinance is limited to judgments entered in designated jurisdictions, which currently include: Australia, Austria, Belgium, Bermuda, Brunei, France, Germany, India, Israel, Italy, Malaysia, The Netherlands, New Zealand, and Singapore and Sri Lanka. The common law permits an action to be brought upon a foreign judgment, but it is subject to various conditions including, but not limited to, that the foreign judgement must (1) be for a definite sum of money; (2) be final and conclusive; and (3) have been entered by a court with competent jurisdiction over the defendant. The defenses that are available to a defendant in a common law action brought on the basis of a foreign judgment include lack of jurisdiction, breach of natural justice, fraud, and contrary to public policy. However, a separate legal action for debt must be commenced in Hong Kong in order to recover such debt from the judgment debtor.

Mainland China

We are a company incorporated under the laws of the Cayman Islands, and all of our operating subsidiaries’ operations are conducted in China, with all of our assets located in China. In addition, all of our senior executive officers, Mr. Weiqi Huang, Ms. Zhe Liang, Mr. Jiye He, Mr. Gaokui Zhang, and Mr. Xufeng Lu, are located in the PRC. As a result, it may be difficult for you to effect service of process upon us or those persons inside China. Furthermore, there is uncertainty as to whether the courts of the PRC would recognize or enforce judgments of U.S. courts against us or such persons predicated upon the civil liability provisions of U.S. securities laws or those of any U.S. state.

Our PRC counsel, Jiangsu Junjin Law Firm, has advised us that the recognition and enforcement of foreign judgments are provided for under the PRC Civil Procedure Law. PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedure Law based either on treaties between China and the country where the judgment is made or on reciprocity between jurisdictions. There are no treaties or other forms of reciprocity between China and the United States for the mutual recognition and enforcement of court judgments. Jiangsu Junjin Law Firm has further advised us that under PRC law, PRC courts will not enforce a foreign judgment against us or our officers and directors if the court decides that such judgment violates the basic principles of PRC law or national sovereignty, security or public interest, thus making the recognition and enforcement of a U.S. court judgment in China difficult.

Additionally, it may also be difficult for you or overseas regulators to conduct investigations or collect evidence within China. Although the authorities in China may establish a regulatory cooperation mechanism with counterparts from another country or region to monitor and oversee cross-border securities activities, such regulatory cooperation with U.S. securities regulatory authorities may not be efficient in the absence of a practical cooperation mechanism. Furthermore, according to Article 177 of the PRC Securities Law, which became effective in March 2020, no overseas securities regulator is allowed to directly conduct investigations or evidence collection activities within the territory of the PRC. Article 177 further provides that Chinese entities and individuals are not allowed to provide documents or materials related to securities business activities to foreign agencies without prior consent from the securities regulatory authority of the PRC State Council and the competent departments of the PRC State Council. While detailed interpretations or implementing rules under Article 177 are yet to be promulgated, the inability of an overseas securities regulator to directly conduct investigation or evidence collection activities within China may further increase the difficulties faced by you in protecting your interests.

As a result, the uncertainty surrounding the recognition and enforcement of judgments of U.S. courts and the challenges in conducting investigations or collecting evidence in China highlight the risks and difficulties you may encounter in protecting your interests against us and our executive officers. See “Risk Factors — Risks Related to Doing Business in China — You may experience difficulties in effecting service of legal process, enforcing foreign judgments, or bringing actions in China against us or our management named in the prospectus based on foreign law. It may also be difficult for you or overseas regulators to conduct investigations based on foreign laws.”

British Virgin Islands

The courts of the British Virgin Islands will not necessarily enter judgments in original actions brought in those courts predicated on U.S. federal or state securities laws. Additionally, there is no statutory enforcement in the British Virgin Islands of judgments obtained in the United States, however, the courts of the British Virgin Islands will in certain circumstances recognize such a foreign judgment and treat it as a cause of action in itself which may be sued upon as a debt at common law so that no retrial of the issues would be necessary provided that:

•        the U.S. court issuing the judgment had jurisdiction in the matter and the company either submitted to such jurisdiction or was resident or carrying on business within such jurisdiction and was duly served with process;

•        is final and for a liquidated sum;

•        the judgment given by the U.S. court was not in respect of penalties, taxes, fines or similar fiscal or revenue obligations of the company;

•        in obtaining judgment there was no fraud on the part of the person in whose favor judgment was given or on the part of the court;

•        recognition or enforcement of the judgment in the British Virgin Islands would not be contrary to public policy; and

•        the proceedings pursuant to which judgment was obtained were not contrary to natural justice.

In appropriate circumstances, the British Virgin Islands Court may give effect in the British Virgin Islands to other kinds of final foreign judgments such as declaratory orders, orders for performance of contracts and injunctions.

We expect that in the event of a voluntary liquidation of the company, after payment of the liquidation costs and any sums then due to creditors, that the liquidator would distribute our remaining assets on a pari passu basis.

Under British Virgin Islands law, the directors owe fiduciary duties at both common law and under statute, including a statutory duty to act honestly, in good faith and with a view to our best interests. When exercising powers or performing duties as a director, the director is required to exercise the care, diligence and skill that a reasonable director would exercise in the circumstances taking into account, without limitation the nature of the company, the nature of the decision and the position of the director and the nature of the responsibilities undertaken by him. In exercising the powers of a director, the directors must exercise their powers for a proper purpose and shall not act or agree to the company acting in a manner that contravenes our memorandum and articles of association or the BVI Business Companies Act of the British Virgin Islands (as revised from time to time).

CORPORATE HISTORY AND STRUCTURE

Corporate History

Skycorp Cayman (formerly known as Skycorp Digital Holdings Group Limited) was incorporated under the laws of the Cayman Islands as an exempted company on January 19, 2022, for the purposes of effectuating this offering, and is currently not engaging in any business. We commenced our business through Ningbo Skycorp formed in April 2011 and conducted our operating subsidiaries’ operations in China through Ningbo Skycorp and its subsidiaries. This is an offering of the ordinary shares of the Cayman Islands holding company. You may never hold equity interests in the operating PRC subsidiaries. Skycorp Cayman controls its PRC subsidiaries through equity ownership. We do not use a variable interest entity structure.

Skycorp BVI was established in the British Virgin Islands on February 16, 2022. Skycorp BVI is a wholly owned subsidiary of Skycorp Cayman and a holding company currently not actively engaging in any business.

GreenHash Limited was incorporated on March 30, 2022 under the laws and regulations in Hong Kong. GreenHash Limited is a wholly owned subsidiary of Skycorp BVI and a holding company currently not actively engaging in any business.

Ningbo WFOE was established on June 29, 2023 under the laws of the PRC. Ningbo WFOE is a wholly owned subsidiary of GreenHash Limited and a holding company not actively engaging in any business.

Guangzhou WFOE was established on July 14, 2020 under the laws of the PRC. Guangzhou WFOE is a wholly owned subsidiary of GreenHash Limited and a holding company not actively engaging in any business.

Ningbo Skycorp was established on April 26, 2011 under the laws of the PRC. Ningbo Skycorp is 49% owned by Ningbo WFOE and 51% owned by Guangzhou WFOE and is our operating entity for HPC severs and solar PV products.

Ningbo Pntech was established on April 22, 2011 under the laws of the PRC. Ningbo Pntech is a 75% owned subsidiary of Ningbo Skycorp, and is our operating entity engaging in the provision of solar PV products. The remaining 25% equity interest of Ningbo Pntech was owned as to 12.5% by a third-party individual Mr. Qingqing Shen and 12.5% by a third-party individual Mr. Xufeng Lu.

Zhejiang Pntech was established on April 26, 2021 under the laws of the PRC. Zhejiang Pntech is a 65% owned subsidiary of Ningbo Skycorp and is our operating entity engaging in the manufacture and sale of solar PV products. The remaining 35% equity interest of Zhejiang Pntechwas owned as to 30% by a third-party individual Mr. Xufeng Lu and 5% by a third-party individual Ms. Fangyuan Qiu.

Zhejiang Skycorp was established on April 23, 2015 under the laws of the PRC. Zhejiang Skycorp is a wholly owned subsidiary of Ningbo Skycorp and is our operating entity engaging in the sale of HPC servers.

Ningbo Dcloud Information was established on July 27, 2015 under the laws of the PRC. Ningbo Dcloud Information is a wholly owned subsidiary of Ningbo Skycorp and is our operating entity engaging in the sale of HPC servers.

Huangshan Qiyu New Energy Co., Ltd. (“Huangshan Qiyu”) was established on March 27, 2024 under the laws of the PRC. Huangshan Qiyu is a wholly owned subsidiary of Zhejiang Pntech and is not actively engaged in any business.

Pntech Technology (Shaoxing) Co., Ltd. (“Shaoxing Pntech”) was established on June 27, 2024 under the laws of the PRC. Shaoxing Pntech is 51% owned by Zhejiang Pntech and 49% owned by Zhejiang Skycorp and is not actively engaged in any business.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

The following management’s discussion and analysis of financial condition and results of operations contains forward-looking statements which involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under “Risk Factors” and elsewhere in this prospectus. You should read the following discussion in conjunction with our consolidated financial statements and related notes included elsewhere in this prospectus.

Unless otherwise indicated, all share amounts and per share amounts in this prospectus have been presented giving effect to a forward split of our Ordinary Shares at a ratio of 1-for-10,000, with the Company’s authorized share capital remaining at $50,000, divided into 500,000,000 Ordinary Shares with a par value of $0.0001 and the surrender of 475,000,000 Ordinary Shares, all of which were approved by our shareholders and board of directors on October 21, 2024.

Overview

We are a solar PV product provider principally engaged in the manufacture and sale of solar cables and solar connectors. We also actively cultivate partnerships with multiple IC chip manufacturers and offer customers new and used GPU and HPC servers. Our business is carried out through our operating subsidiaries, Ningbo Skycorp and its subsidiaries, in China.

Our mission is to become a green energy solutions provider to power data centers by using solar power and to make our planet greener by delivering environment-friendly solar PV products. Leveraging our expertise and experience in the solar PV products and services market, experience in developing solar power technologies, as well as business relationships with our HPC server customers, we aim to expand our solar PV product offerings and high computing server solutions to enterprise customers of HPC servers.

For the six months ended March 31, 2024 and 2023, our revenue was $22,483,601 and $22,259,338, respectively, and our net income was $643,498 and $68,127, respectively. For the six months ended March 31, 2024, we generated 89.70% of our revenue from solar PV products and services and 10.30% from HPC products compared to 63.76% of our revenue from solar PV products and services and 36.24% from HPC products for the six months ended March 31, 2023.

Key Factors that Affect Operating Results

We believe our results of operations and future success are primarily affected by the following specific factors:

Economic and industry trends in China and globally

Our business and results of operations are affected by general factors driving the solar PV energy and HPC server industries, which are well positioned for further growth potential as indicated by, among others, (i) the strong and steady growth of the respective markets globally, and (iii) increasing demand for technologically advanced and diversified products. Consumer demand is driven by a number of other factors, including rapidly growing demand for quality and technology innovation, rising energy costs and utility costs. We believe that we are poised to benefit from the resilient consumer demand benefiting from certain favorable government policies and regulations applicable to the industry alongside the overall macroeconomic growth. On the other hand, there could also be industry challenges and regulatory restrictions in the future that affect us.

Our ability to ramp up production and increase sales volume

Our results of operation and financial performance depends upon our ability to continue to expand production capacity in response to the increasing consumer demand. Hence, it is critical for us to continuously ramp up production and increase sales volume. We conduct a lean production approach and determine our production target by closely monitoring the actual ordering requirements from customers. In addition, we take a comprehensive and strict management over the quality control to enhance the production efficiency and ensure delivery in a timely manner. Furthermore, we plan to enhance our automation level in the future.

Our current manufacturing facility in Ningbo, Zhejiang Province commenced production in June 2015 and has an annual production capacity of 150 million meters to fulfill the current demand. We intend to construct new manufacturing facility in Nanjing Pukou District to diversify our products portfolio and further solidify our market position. This manufacturing facility is expected to commence manufacturing in 2025. We believe that we will be able to reduce our volume-driven product costs and improve our gross margin when operating at scale.

Our ability to expand in domestic and international markets

Our business success and financial performance depends in part on our expansion of market presence. Levering our insights and extensive experience through years of refinement and evolvement, we believe we are well positioned to successfully compete in the surging global market. We continue to position ourselves in existing geographic markets in Asia and Europe which we expect to serve as important sources of future growth. We have built and will continue to expand a robust sales network across China and globally efficiently as we view international expansion as an important element of our strategy for our long-term development. Accordingly, expanded global reach will require continued investment and may expose us to additional foreign currency risk, international taxes and tariffs, legal obligations and additional operational costs, risks and challenges that may impact our result of business and financial condition.

Our ability to maintain existing and attract prospective customers

Our sustainable growth in the long term is significantly dependent upon the retention and growth of our customer base. We amassed a large, loyal and growing premium customers covering a wide spectrum of verticals, providing a stable source of business for our operating subsidiaries’ operations and highlighted our continued efforts to address their needs over time.

As we continue to ramp up our business presence and enhance our brand awareness and economies of scale, we expect to attract new and retain existing customers. Leverage our industry knowhow and brand recognition, we strive to stay close with our existing and prospective customers to understand their needs and preferences, which we believe is enabling us to further penetrate the respective industry and capture additional market share, and continue to diversify our customer base efficiently. We continue to invest in our sells and marketing efforts, which are critical to driving customer acquisition.

Our ability to investment in technology innovation and talents

Our business success and financial performance, particularly our ability to drive growth, depends upon our technological capabilities. As of the date of this prospectus, we have mastered multiple key technologies and possessed 47 patents, including 33 utility model patents, six invention patents and seven design patents. For details, see “Business — Our Strengths” and “Business — Intellectual Property — Patent.”

We have and will continue to make investments in technology to constantly innovate and adapt to evolving consumer preferences. We intend to establish an R&D center and continue to attract more experienced, talented R&D personnel to increase our competitiveness and strengthen our R&D efforts. In addition, we expect to cooperate with PV module manufacturers and solar energy storage enterprises, some of which have industry-leading positions in the respective domain they operate in, to expand our product portfolio riding on the strong and steady growth of the solar PV energy industry, in hope to win market share. For details, see “Business — Our Strategies — Increase efficiency by development of technologies.”

Our ability to manage costs and improve operating efficiency

Our results of operations are affected by our ability to effectively control costs and enhance our operating efficiency. A significant portion of our cost of revenues primarily relates to raw materials and components, which is determined principally by market forces and changes in governmental policies, as well as our bargaining power with our suppliers. The market price of the relevant raw materials and components fluctuates with market conditions. For the six months ended March 31, 2024 and 2023, raw material and component costs accounted for 86% and 86% of our total cost of revenues, respectively. Our ability to effectively control these costs as we continue to ramp up our production volume has affected and will continue to affect our financial performance significantly. Going forward, we will actively cultivate partnerships with suppliers to maintain competitive pricing terms.

With the support of practical experience and industry know-how gained from our extensive operations serving a large customer base, we continue to refine and enrich our production to improve operating efficiency. With respect to selling and marketing expenses, we expect to continue to benefit increasingly from the network effect of our enhanced brand presence. We also intend to optimize our general and administrative expenses by enhancing our level of management, streamlining our internal workflows, and leveraging technology to drive convenience, cost-efficiency and productivity.

COVID-19

The outbreak of COVID-19 began in December 2019 and was quickly declared a Public Health Emergency of International Concern on January 30, 2020 by the World Health Organization.

The COVID-19 pandemic has not had a significant negative impact on our operating subsidiaries’ operations or financial performance to date, the government has adopted several measures to contain and mitigate the effects of the COVID-19 pandemic, including quarantines, travel restrictions, and the temporary closure of stores and facilities, capsuled labor, and other restrictive orders. Our business maintained an upward trend despite these challenges during the fiscal years 2023 and 2022.

COVID-19 was temporarily contained in the PRC since the second quarter of 2020 through 2021, certain of our manufacturers experienced delays and shut-downs due to the COVID-19 pandemic. However, our production and sales of solar PV products resumed gradually in the second half of 2020 and the fiscal year 2021.

From January 2022 to July 2022, there were outbreaks of the Omicron variant of COVID-19 and the local governments placed lockdowns and mass testing policies in most cities in China, where our dealers and suppliers operate, including but not limited to Tianjin, Beijing, Shanghai, and Ningbo. Starting in July 2022, China gradually loosened its quarantine policy, and the overall economy and consumer spending bounced back significantly. As a result, our total revenues increased by approximately 54% for the year ended September 30, 2022 compared to the year ended September 30, 2021.

In late 2022, there was a temporary surge of COVID-19 cases in many cities in the PRC during this time, which, to varying degrees and for a short period of time, disrupted our and our customers’ and suppliers’ business operations, and therefore affected our operational and financial performance. Shortly after that, our business operations in the PRC returned to normal levels in the fiscal year 2023 and in the six months ended March 31, 2024. However, we cannot assure you that our business will not be affected by an outbreak of COVID-19 in the future.

Results of Operations

Six Months Ended March 31, 2024 and 2023

The following tables set forth a summary of our consolidated statements of operations and comprehensive income for the six months ended March 31, 2024 and 2023, respectively. This information should be read together with our consolidated financial statements and related notes included elsewhere in this prospectus. The results of operations in any period are not necessarily indicative of our future trends.

Revenues

Our revenue for the six months ended March 31, 2024 and 2023 was $22,483,601 and $22,259,338, respectively. The $224,263, or 1.01% increase in revenue mainly resulted from the $5,975,352, or 42.10% increase in solar PV products sales though offset by $5,751,089, or 71.30% decrease in HPC products sales.

The booming global photovoltaic market, coupled with the shortage of electricity in Europe, has led to a huge growth in our PV product revenue for the six months ended March 31, 2024.

The significant decrease in HPC product revenue was due to the global economic slowdown, and our relatively conservative investment in HPC for the six months ended March 31, 2024.

Cost of revenues

Cost of revenues consists primarily of manufacturing and purchase cost of servers, photovoltaic cable, and photovoltaic connectors etc., depreciation, maintenance, and other overhead expenses.

Our cost of revenue for solar PV products increased by $5,135,031, or 42.86%, to $17,114,583 for the six months ended March 31, 2024 from $11,979,552 for the six months ended March 31, 2023. The percentage increase in cost of revenue was consistent with the 42.10% increase in solar PV products sales revenue.

Our cost of revenue for HPC products sales decreased by $5,208,580, or 72.52%, to $1,973,471 for the six months ended March 31, 2024 from $7,182,051 for the six months ended March 31, 2023. The percentage decrease in cost of revenue was consistent with the 71.30% decrease in HPC products sales revenue.

Gross profit and margin

Gross profit for the six months ended March 31, 2024 and 2023 was $3,395,547 and $3,097,735, representing 15.10% and 13.92% of revenue, respectively. The increase from 13.92% to 15.10% in gross margin for the six months ended March 31, 2024 was due to the increase of 42.10% in solar PV products sales, whose gross margin was comparatively higher.

Selling and marketing expenses

Our selling and marketing expenses primarily consist of salaries and benefits, office expense, and freight expense. Our selling and marketing expenses were $790,232 and $1,029,906 for the six months ended March 31, 2024 and 2023, respectively. The selling and marketing expenses decreased by $239,674, or 23.27%, primarily due to less transport expense for the six months ended March 31, 2024.

General and administrative expenses

Our general and administrative expenses consist primarily of salaries and welfare expenses, rent expense, depreciation and bad debt provision. Our general and administrative expenses were $1,198,885 and $1,582,083 for the six months ended March 31, 2024 and 2023 respectively, representing a decrease of $383,198, or 24.22%, primarily due to lower service fees and office expenses for the six months ended March 31, 2024.

Research and development expenses

Research and development expenses are related to improvement expenses for solar PV products. Research and development expenses primarily consist of employee salaries and benefit costs. Research and development expenses were $828,848 and $170,391 for the six months ended March 31, 2024 and 2023, respectively.

Income tax expense

The PRC EIT is calculated based on the taxable income determined under the applicable EIT Law and its implementation rules, which became effective on January 1, 2008. The EIT Law applies a uniform 25% income tax rate for all resident enterprises in China. Income tax expenses amounted to $143,875 and $34,104 for the six months ended March 31, 2024 and 2023, respectively. The change resulted from the change in our taxable income.

Net income

As a result of the foregoing, our net incomes for the six months ended March 31, 2024 and 2023 were $643,498 and $68,127, respectively, representing an increase of $575,371, or 844.56%.

Liquidity and Capital Resources

We plan to support our future operations primarily from cash generated from our operating subsidiaries’ operations and the proceeds from our initial public offering. We may, however, require additional cash due to business expansion or other future developments. If our future cash is insufficient to meet our requirements, we may further to seek to issue debt or equity securities or obtain additional credit facilities.

As of March 31, 2024, we had cash and cash equivalents of $3,540,200 and a total working capital of $13,325,377.

As of September 30, 2023, we had cash and cash equivalents of $5,642,795 and a total working capital of $15,517,003.

We believe that we will generate sufficient cash flows to fund our operating subsidiaries’ operations and to meet our obligations on a timely basis for the next 12 months, assuming the successful implementation of our business plans.

Current foreign exchange and other regulations in the PRC may restrict our PRC entities in their ability to transfer their net assets to us and our subsidiaries. However, we have no present plans to declare dividend and we plan to retain our retained earnings to continue to grow our business. In addition, these restrictions had no impact on our ability to meet our cash obligations as all of our current cash obligations are due within the PRC.

To utilize the proceeds from our initial public offering, we may make additional loans or capital contributions to our PRC subsidiaries. PRC laws and regulations allow an offshore holding company to provide funding to our PRC subsidiaries only through loans or capital contributions, subject to the filing or approval of government authorities and limits on the amount of capital contributions and loans. Subject to satisfaction of applicable government registration and approval requirements, we may extend inter-company loans to our PRC subsidiaries or make additional capital contributions to fund their capital expenditures or working capital. For an increase of registered capital, our PRC subsidiaries need to file such change of registered capital with the SAMR or its local counterparts through the enterprise registration system and the national enterprise credit information publicity system, and the SAMR or its local counterparts will then push such information to the China’s MOFCOM or its local counterparts. If the holding company provides funding to our PRC subsidiaries through loans, (a) in the event that the foreign debt management mechanism as provided in the Measures for Foreign Debts Registration and Administration and other relevant rules applies, the balance of such loans cannot exceed the difference between the total investment and the registered capital of the subsidiaries and we will need to register such loans with the SAFE or its local branches, or (b) in the event that the mechanism as provided in the Notice

of the People’s Bank of China on Matters concerning the Macro-Prudential Management of Full-Covered Cross-Border Financing, or PBOC Notice No. 9, applies, the balance of such loans will be subject to the risk-weighted approach and the net asset limits and we will need to file the loans with the SAFE in its information system pursuant to applicable requirements and guidelines issued by the SAFE or its local branches. While we currently see no material obstacles to completing the filing and registration procedures with respect to future capital contributions to our PRC subsidiaries and loans to our PRC subsidiaries, we cannot assure that we will be able to complete these filings and registrations on a timely basis, or at all. See “Risk Factors — Risks Related to Doing Business in China — PRC regulations on loans to and direct investment in PRC entities by offshore holding companies may delay or prevent us from making loans or additional capital contributions to our PRC operating subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.” We expect the net proceeds from our initial public offering in 2024 to be used in the PRC and will be in the form of Renminbi and, therefore, our PRC subsidiaries will need to convert any capital contributions or loans from U.S. dollars into Renminbi in accordance with applicable PRC laws and regulations.

Cash Flows

The following table summarizes our cash flows for the periods indicated:

Operating Activities

Net cash used in operating activities was $1,029,992 for the six months ended March 31, 2024, mainly comprising an increase in inventories of $1,174,864, an increase in account receivable of $1,916,377, a decrease of $525,490 in account payable, a decrease of $83,259 in operating lease liabilities, and offset by net income of $643,498, depreciation and amortization of $148,190, provision for expected credit loss of $107,577, a decrease of $612,948 in prepaid expenses and other current assets, an increase of $516,880 in advance from customer.

The increase in inventory and account receivable were mainly due to easier payment terms provided to customers, which significantly promoted sales and delayed receipt of payments for the six months ended March 31, 2024.

For the six months ended March 31, 2024, the global economic growth was slowing down, and the market demand for HPC service was decreasing. The Company adjusted its strategy to focus on the solar PV products sales. As a result, the prepayment to HPC server suppliers decreased and inventory increased.

Net cash used in operating activities was $977,565, for the six months ended March 31, 2023, primarily consisted of an increase of $1,104,051 in account receivable, a decrease of $1,786,897 in account payable, a decrease of $4,866,015 in advance from customer, and offset by net income of $68,127, depreciation and amortization of $27,867, amortization of right-of-used asset of $79,376, a decrease in inventories of $3,688,384, a decrease of $1,857,051 in prepaid expenses and other current assets, and an increase in tax payable of $741,789.

As of September 30, 2022, more inventories were received, which caused the significant increase in inventory. And as of March 31, 2023, the Company has not experienced any abnormal large-scale goods in or out, which resulted in a stable inventory balance. That is the reason for the significant decrease in inventory for the six months ended March 31, 2023.

The Company obtained long term high-value orders in HPC server business during the year ended September 30, 2022, from which the Company received large advances from HPC server customers. But during the six months ended March 31, 2023, the sharp decrease in HPC server business leads to a sudden decrease in advance receipts. This is why advance from customer decreased significantly in the amount of $4,866,015.

Investing Activities

For the six months ended March 31, 2024, net cash used in investing activities was $2,380,528, which was mainly due to a payment of $2,227,187 to Nanjing Cesun Power Co., Ltd. for downpayment for investment, and the payment of $153,341 in purchasing property, plant and equipment.

On October 25, 2023, the Company committed to invest $6,000,000 (RMB43,321,800) to establish a new company, Nanjing Cesun Power Co., Ltd.,with other parties. As of March 31, 2024, the Company paid $2,227,187 (RMB16,050,000), and had $3,772,813 (RMB27,271,800) outstanding.

For the six months ended March 31, 2023, net cash used in investing activities was $136,683, which was resulted from a purchase of property and equipment.

Financing Activities

For the six months ended March 31, 2024, net cash provided by financing activities was $954,129, mainly consisting of proceeds of $1,360,236 in bank borrowings, proceeds from related parties of $1,906,091, and offset by repayment of $1,937,730 in bank borrowings, payment to related parties of $235,702, and dividends to minority shareholders of $138,766.

For the six months ended March 31, 2023, net cash provided by financing activities was $1,649,910, mainly contributed by net proceeds of $1,118,149 in bank loan borrowings, proceeds of $723,856 from related parties, and offset by repayment of $189,037 to related party.

Years Ended September 30, 2023 and 2022

The following tables set forth a summary of our consolidated statements of operations and comprehensive income for the fiscal years ended September 30, 2023 and 2022, respectively. This information should be read together with our consolidated financial statements and related notes included elsewhere in this prospectus. The results of operations in any period are not necessarily indicative of our future trends.

For the Year Ended September 30, 2023

For the Year Ended September 30, 2022

Revenues

Our revenues for the years ended September 30, 2023 and 2022 were $50,815,675 and $59,059,644, respectively. The $8,243,969, or 13.96% decrease in revenues mainly resulted from the $20,379,499, or 59.04% decrease in HPC products sales though offset by $12,135,530, or 49.45% increase in solar PV products sales.

The significant decrease in HPC product revenue was due to the global economic slowdown, and our relatively conservative investment in HPC for the year ended September 30, 2023.

The booming global photovoltaic market, coupled with the shortage of electricity in Europe, has led to a huge growth in our PV product revenue for the year ended September 30, 2023.

Cost of revenues

Cost of revenues consists primarily of manufacturing and purchase cost of servers, photovoltaic cable, and photovoltaic connectors etc., depreciation, maintenance, and other overhead expenses.

Our cost of revenues for solar PV products increased by $10,220,499, or 49.88%, to $30,711,003 for the year ended September 30, 2023 from $20,490,504 for the year ended September 30, 2022. The percentage increase in cost of revenue was consistent with the 49.45% increase in revenues.

Our cost of revenues for HPC products sales decreased by $18,085,759, or 61.17%, to $11,482,753 for the year ended September 30, 2023 from $29,568,512 for the year ended September 30, 2022. The percentage increase in cost of revenue was consistent with the 59.04% increase in revenues.

Gross profit and margin

Gross profits for the years ended September 30, 2023 and 2022 were $8,621,919 and $9,000,628, representing 16.97% and 15.24% of revenues, respectively. The increase from 15.24% to 16.97% in gross margin for the year ended September 30, 2023 was due to the increase of 49.45% in Solar PV products sales, whose gross margin was comparatively higher.

Selling and marketing expenses

Our selling and marketing expenses primarily consist of salaries and benefits, office expense, and freight expense. Our selling and marketing expenses were $2,464,908 and $2,559,679 for the years ended September 30, 2023 and 2022, respectively. The selling and marketing expenses decreased by $94,771, or 3.70%, primarily due to less sales commission for the year ended September 30, 2023.

General and administrative expenses

Our general and administrative expenses consist primarily of salaries and welfare expenses, rent expense, depreciation and bad debt provision. Our general and administrative expenses were $2,831,805 and $2,922,651 for the years ended September 30, 2023 and 2022 respectively, representing a decrease of $90,846, or 3.11%, primarily due to less professional fee and office expenses occurred for the year ended September 30, 2023.

Research and development expenses

Research and development expenses are related to improvement expenses for solar PV products. Research and development expenses primarily consist of employee salaries and benefit costs. Research and development expenses were $607,484 and $318,308 for the years ended September 30, 2023 and 2022, respectively.

Income tax expense

The PRC EIT is calculated based on the taxable income determined under the applicable EIT Law and its implementation rules, which became effective on January 1, 2008. The EIT Law applies a uniform 25% income tax rate for all resident enterprises in China. Income tax expenses amounted to $752,072 and $1,074,568 for the years ended September 30, 2023 and 2022, respectively. The change resulted from the change in our taxable income.

Net income

As a result of the foregoing, our net incomes for the years ended September 30, 2023 and 2022 were $1,807,728 and $2,149,807, respectively, representing a decrease of $342,079, or 15.91%.

Liquidity and Capital Resources

We plan to support our future operations primarily from cash generated from our operating subsidiaries’ operations and the proceeds from our initial public offering. We may, however, require additional cash due to business expansion or other future developments. If our future cash is insufficient to meet our requirements, we may further to seek to issue debt or equity securities or obtain additional credit facilities.

As of September 30, 2023, we had cash and cash equivalents of $5,642,795 and a total working capital of $15,517,003.

As of September 30, 2022, we had cash and cash equivalents of $3,452,791 and a total working capital of $15,360,065.

We believe that we will generate sufficient cash flows to fund our operating subsidiaries’ operations and to meet our obligations on a timely basis for the next 12 months, assuming the successful implementation of our business plans.

Current foreign exchange and other regulations in the PRC may restrict our PRC entities in their ability to transfer their net assets to us and our subsidiaries. However, we have no present plans to declare dividend and we plan to retain our retained earnings to continue to grow our business. In addition, these restrictions had no impact on our ability to meet our cash obligations as all of our current cash obligations are due within the PRC.

To utilize the proceeds from our initial public offering, we may make additional loans or capital contributions to our PRC subsidiaries. PRC laws and regulations allow an offshore holding company to provide funding to our PRC subsidiaries only through loans or capital contributions, subject to the filing or approval of government authorities and limits on the amount of capital contributions and loans. Subject to satisfaction of applicable government registration and approval requirements, we may extend inter-company loans to our PRC subsidiaries or make additional capital

contributions to fund their capital expenditures or working capital. For an increase of registered capital, our PRC subsidiaries need to file such change of registered capital with the SAMR or its local counterparts through the enterprise registration system and the national enterprise credit information publicity system, and the SAMR or its local counterparts will then push such information to the China’s MOFCOM or its local counterparts. If the holding company provides funding to our PRC subsidiaries through loans, (a) in the event that the foreign debt management mechanism as provided in the Measures for Foreign Debts Registration and Administration and other relevant rules applies, the balance of such loans cannot exceed the difference between the total investment and the registered capital of the subsidiaries and we will need to register such loans with the SAFE or its local branches, or (b) in the event that the mechanism as provided in the Notice of the People’s Bank of China on Matters concerning the Macro-Prudential Management of Full-Covered Cross-Border Financing, or PBOC Notice No. 9, applies, the balance of such loans will be subject to the risk-weighted approach and the net asset limits and we will need to file the loans with the SAFE in its information system pursuant to applicable requirements and guidelines issued by the SAFE or its local branches. While we currently see no material obstacles to completing the filing and registration procedures with respect to future capital contributions to our PRC subsidiaries and loans to our PRC subsidiaries, we cannot assure that we will be able to complete these filings and registrations on a timely basis, or at all. See “Risk Factors — Risks Related to Doing Business in China — PRC regulations on loans to and direct investment in PRC entities by offshore holding companies may delay or prevent us from making loans or additional capital contributions to our PRC operating subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.” We expect the net proceeds from our initial public offering in 2024 to be used in the PRC and will be in the form of Renminbi and, therefore, our PRC subsidiaries will need to convert any capital contributions or loans from U.S. dollars into Renminbi in accordance with applicable PRC laws and regulations.

Cash Flows

The following table summarizes our cash flows for the periods indicated:

Operating Activities

Net cash provided by operating activities was $549,261, for the year ended September 30, 2023, mainly comprising net income of $1,807,728, depreciation of $263,059, a decrease in inventories of $4,904,689, a decrease in prepaid expenses and other current assets of $4,850,467, provision for expected credit loss of $115,634, and offset by an increase of $5,983,398 in account receivable, a decrease of $6,559,743 in advance from customer.

The decrease in inventory and increase in account receivable were mainly due to easier payment terms provided to customers, which significantly promoted sales and delayed receipt of payments for the year ended September 30, 2023.

For the year ended September 30, 2023, the global economic growth was slowing down, and the market demand for HPC service was decreasing. The Company adjusted its strategy to focus on the solar PV products sales. As a result, both the prepayment to HPC server suppliers and advances from HPC server customers decreased for the current year. Advance from HPC server customers was included in other liabilities.

Net cash provided by operating activities was $10,984,681, for the year ended September 30, 2022, primarily consisted of net income of $2,149,807, a decrease of $5,090,500 in prepaid expenses and other current assets, an increase of $6,203,199 in advance from customer, and offset by an increase in inventories of $4,035,388, and an increase in account receivable of $757,036.

At the end of 2022, more inventories were received, and some prepayments to suppliers were reversed, which caused the significant increase in inventory and significant decrease in prepaid expenses and other current assets.

The Company obtained long term high-value orders in HPC server business during the year ended September 30, 2022, from which the Company received large advances from HPC server customers. This is why advance from customer increased in the amount of $6,203,199.

Investing Activities

For the year ended September 30, 2023, net cash used in investing activities was $2,268,753, which was due to a purchase of property and equipment of $303,410, a payment of intangible assets of $1,965,343.

For the year ended September 30, 2022, net cash used in investing activities was $168,065, which was due to a purchase of property and equipment.

Financing Activities

For the year ended September 30, 2023, net cash provided by financing activities was $3,522,997, mainly consisting of proceeds of bank borrowings of $2,446,009, proceeds from related parties of $2,401,288, and offset by repayment of bank borrowings of $1,279,532.

For the year ended September 30, 2022, net cash used in financing activities was $7,773,093, mainly contributed by repayment to related parties of $8,697,350, repayment of bank borrowings of $460,354, and offset by net proceeds of bank borrowings of $1,377,787.

Trend Information

Other than as disclosed in “Risk Factors — Risks Related to Our Business and Industry — Our business has been and may continue to be affected by the outbreak of COVID-19” in this prospectus, we are not aware of any trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on our net revenues, net income, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial condition.

Off-Balance Sheet Arrangements

We did not have during the periods presented, and we do not currently have, any off-balance sheet financing arrangements or any relationships with unconsolidated entities or financial partnerships, including entities sometimes referred to as structured finance or special purpose entities, that were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

Tabular Disclosure of Contractual Obligations

Commitments and Contingencies

From time to time, we may be subject to certain legal proceedings, claims and disputes that arise in the ordinary course of business. Although the outcomes of these legal proceedings cannot be predicted, we do not believe these actions, in the aggregate, will have a material adverse impact on our financial position, results of operations or liquidity, except for the following disclosure.

Capital Commitment

On May 11, 2023, the Company committed to invest $68,538 (RMB500,000) to Ningbo Yiqiying New Energy Co., Ltd. As of March 31, 2024, the Company had outstanding balances of $68,538 (RMB 500,000).

On October 25, 2023, the Company committed to invest $6,000,000 (RMB43,321,800) to establish a new company, Nanjing Cesun Power Co., Ltd., with other parties. As of March 31, 2024, the Company paid $2,222,899 (RMB16,050,000), and had $3,777,101 (RMB27,271,800) outstanding. The Company expected to pay off the outstanding capital fund before September 30, 2025.

On March 19, 2024, the Company committed to invest $69,249 (RMB500,000) to establish a new company, Suqian Shuyong New Energy Co., Ltd., with other party. As of March 31, 2024, the Company had $69,249 (RMB 500,000) outstanding. The Company expected to pay off the outstanding capital fund before September 30, 2025.

We did not have other significant capital commitment, other commitments, long-term obligations, or guarantees as of March 31, 2024.

Critical Accounting Policies

(a)    Basis of presentation and principles of consolidation

The accompanying financial statements include the balances and results of operations of the Company have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchanges Commission (“SEC”) and in conformity with generally accepted accounting principles in the U.S. (“US GAAP”).

A subsidiary is an entity in which the Company directly or indirectly controls more than one half of the voting power, has the power to appoint or remove the majority of the members of the board of directors, to cast a majority of notes at the meeting of the board of directors or to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders.

All inter-company transactions and balances have been eliminated upon consolidation.

(b)    Use of estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period and accompanying notes, including allowance for doubtful accounts, the useful lives of property and equipment, impairment of short-term investments, long-term investments and long-lived assets, valuation allowance for deferred tax assets and uncertain tax opinions. Actual results could differ from those estimates.

(c)     Foreign Currency Translation

The reporting currency of the Company is the U.S. dollar (“$”). The functional currency of subsidiaries located in China and Hong Kong are the Chinese Renminbi (“RMB”) and the Hong Kong dollars (“HK$”), respectively. For the entities whose functional currency is the RMB and HK$, results of operations and cash flows are translated at average exchange rates during the period, assets and liabilities are translated at the unified exchange rate at the end of the period, and equity is translated at historical exchange rates. As a result, amounts relating to assets and liabilities reported on the statements of cash flows may not necessarily agree with the changes in the corresponding balances on the balance sheets. Translation adjustments are reported as foreign currency translation adjustment and are shown as a separate component of other comprehensive loss in the Consolidated Statements of Operations and Comprehensive Income.

Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the balance sheet date with any transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.

The Company’s assets and liabilities are translated into United States dollars from RMB at year-end exchange rates, and its revenues and expenses are translated at the average exchange rate during the year. Capital accounts are translated at their historical exchange rates when the capital transactions occurred.

(i)     Intangible asset, net

Intangible assets are carried at cost less accumulated amortization and impairment, if any. Intangible assets are amortized using the straight-line method over the estimated useful lives as below:

The Company’s intangible assets with definite useful lives primarily consist of patent rights. The Company typically amortizes its intangible assets with definite useful lives on a straight-line basis over the shorter of the contractual terms or the estimated useful lives of ten years or twenty years. In accordance with Article 42 of the Patent Law of the people’s Republic of China, management clearly confirm that the term of patent right for invention is 20 years, and that for utility model and design patent is 10 years.

Overview of the HPC Server Industry

Overall HPC Market

According to the High Performance Computing (HPC) Market Report published by Mordor Intelligence, HPC refers to the use of parallel processing for run advanced application programs efficiently, reliably, and quickly. HPC is a method that employs a significant amount of computing power to provide high-performance capabilities in solving several problems in the disciplines of research, business, or engineering. Newer workloads, such as genomic sequencing, machine learning, deep learning, speech, facial recognition, and pattern recognition, are being executed on HPC systems. HPCs contribute significantly to industrial competitiveness, national security, scientific progress, and quality of life. The HPC market is valued at $54.32 billion in 2023 and is expected to grow at a CAGR of 11.18% from 2024 to 2029 to become $96.79 billion in 2029. Increasing adoption of HPC in the cloud and the emerging need to process large amounts of data efficiently and quickly drive market growth (see figure below).

Source: Mordor Intelligence

According to the High Performance Computing Market published by Emergen Research (“Emergen Report”) in March 2022, the global HPC market is segmented into solution and services based on component. Solution segment is further sub-segmented into servers, storage, networking device, and software. Solution segment is expected to lead in terms of revenue contribution to the global market by 2030. This can be attributed to increasing number of data centers, due to various mid-sized enterprises and organizations engaging in colocation infrastructure to meet the increasing demand for public cloud services. HPC systems are expected to gain popularity in businesses throughout the world due to numerous benefits offered by them, including scalability. Services segment is expected to register a significantly faster revenue growth rate by 2030. Demand for HPC services is expected to rise gradually as HPC solutions become more widely adopted. HPC providers offer a variety of services, including maintenance, support, and management, and support is very important while establishing and utilizing HPC systems.

HPC Server Market

According to the statistic published on Statista.com, total HPC server revenues by 2026 were forecast to amount to $20.56 billion, of which the supercomputer segment would generate over $10 billion in revenue, whilst revenues from the departmental segment would generate $4.88 billion in the same year (see figure below).

Source: Statista.com

According to the High Performance Computing Market Trends and Analysis by Region, Component, Deployment, Application and Segment Forecast to 2026 published by GlobalData in February 2023, among segmentation by component, servers dominated the HPC market in 2022 with a revenue share of more than 40% and is expected to continue its domination to 2026. HPC servers use a combination of CPUs, Micro-Electro-Mechanical System, and AI chips. CPUs have been at the heart of powering data centers for decades, but their architectures are not best suited for new types of workloads driven by technologies such as AI and the Internet of Things (“IoT”). GPUs are more powerful than CPUs, but the two chips are used in combination in HPC clusters as they complement each other. Thus, the imperative nature of servers in HPC clusters is expected to drive segmental growth. In addition to servers, the component segment also includes storage, network equipment, software, services, and cloud.

According to the HPC Market Update: Market Results, High Growth Areas and Predictions published by Hyperion Research in 2023, the worldwide HPC server market is forecast to continue at a steady, healthy growth rate for the foreseeable future. Growth drives include countries and companies around the world that continue to recognize the value of being innovative and investing in R&D to advance society, grow revenues, reduce costs, and become more competitive; new technological developments in AI, processors, etc. are providing many new areas for users to advance their research and engineering; and cloud computing is becoming more useful to a larger set of HPC workloads.

Competitive Landscape

According to Emergen Report, North America HPC market is expected to account for a larger revenue share than other regional markets by 2030 which was primarily attributable to the region being the most important regional market for technology-based solutions. Moreover, it is expected to play a major role in the global economy, particularly in adoption and development of new technologies. Asia-Pacific market is expected to register a significantly robust revenue growth rate by 2030, owing to the increasing use of high-performance computing solutions for scientific research and weather forecasting. China is among the top ten countries in the HPC market, and the country has supercomputers such as Tianhe-2 (MilkyWay-2) and Sunway TaihuLight. Tianhe-2 (MilkyWay-2) was created by China’s National University of Defense Technology and was supported by the governments of Guangzhou and

Guangdong province. Europe is expected to register a steady revenue CAGR by 2030. The European High Performance Computing Joint Undertaking is preparing for the exascale transition with a subsequent application for HPC Centers of Excellence, which will fund R&D activities aimed at developing and adapting HPC applications for the exascale and post-exascale eras (see picture below).

Source: www.emergenresearch.com

According to Emergen Report, the global HPC market is fairly fragmented, with few small and medium-sized market players accounting for the majority of revenue. Competition in the HPC industry is characterized by the presence of multiple vendors operating across different layers of value chain. For example, Hewlett Packard Enterprise Co and Dell Technologies Inc have a strong hold across all the components of an HPC cluster. Major players are deploying various strategies, entering into mergers and acquisitions, strategic agreements and contracts, and developing, testing, and introducing more effective high performance computing solutions in the market.

Opportunities for Green Data Centers

The International Energy Agency estimates in Global Data Center Energy Demand by Data Center Type in January 2020 that data centers use 1% of all global electricity and that by 2025, data centers will consume 1/5 of the world’s power supply. Most of the energy demand comes from powering the servers, but they produce heat and need to be cooled. This cooling again requires a lot of energy and generates excess heat — most of which is currently being let out into the surrounding environment.

According to the International Telecommunication Union. 2014. L.1300: Best Practices for Green Date Centers, a green data center can be defined as a repository for the storage, management, and dissemination of data in which the mechanical, lighting, electrical, and computer systems are designed for maximum energy efficiency and minimum environmental impact.

According to Bring on Regulations for Data Center Sustainability, Say Europe and APAC published on Uptime Institute Blog in 2022, as the data center sector globally strives for sustainability, governments can influence this transformation through various instruments, including laws, incentives, and services that can guide the data center sector toward greener outcomes, for example, enforce sustainability standards and motivate operators to adopt green technologies. According to Eastern Data, Western Computing-China’s Big Plan to Boost Data Center Computing Power Across Regions in 2022, Chinese authorities launched a plan to build eight computing hubs and 10 data center clusters across China in 2020. Fundamental guidelines include optimizing power usage effectiveness and maintaining internet latency. The plan emphasizes green requirements, energy efficiency, clean energy, and green procurement. Major technology firms such as Tencent, Alibaba, Baidu, Huawei, ByteDance, Kuaishou, and UCloud are building data centers in western China.

Business

Overview

We are a solar PV product provider principally engaged in the manufacture and sale of solar cables and solar connectors. We also actively cultivate partnerships with multiple IC chip manufacturers and offer customers new and used GPU and HPC servers. Our business is carried out through our operating subsidiaries, Ningbo Skycorp and its subsidiaries, in China.

Our mission is to become a green energy solutions provider to power data centers by using solar power and to make our planet greener by delivering environment-friendly solar PV products. Leveraging our business relationships with our HPC server customers, expertise and experience in the solar PV products and services market, and experience in developing solar power technologies, as well as business relationships with our HPC server customers, we aim to expand our solar PV product offerings and solar power system server solutions to enterprise customers of HPC servers.

For the six months ended March 31, 2024 and 2023, our revenues were $22,483,601 and $22,259,338, respectively, and our net incomes were $643,498 and $68,127, respectively. For the six months ended March 31, 2024, we generated 89.70% from solar PV products and services and 10.30% from HPC products compared to 63.76% from solar PV products and services and 36.24% from HPC products for the six months ended March 31, 2023.

For the years ended September 30, 2023 and 2022, our revenues were $50,815,675 and $59,059,644, respectively, and our net incomes were $1,807,728 and $2,149,807, respectively. For the year ended September 30, 2023, we generated 72.17% from solar PV products and services and 27.83% from HPC products compared to 41.55% from solar PV products and services and 58.45% from HPC products for the year ended September 30, 2022.

The breakdown of total revenues by geographic market for each of the six months ended March 31, 2024 and 2023, and for the years ended September 30, 2023 and 2022 is presented as follows.

The Company has significantly strengthened its marketing in Mainland China, which significantly increased the revenue share of Mainland China from 37% for the year ended September 30, 2022 to 66% for the year ended September 30, 2023, and from 57% for the six months ended March 31, 2023 to 81% for the six months ended March 31, 2024. Most of the growing customers during the periods are actually export-oriented enterprises. After purchasing our products, they ultimately sell them to overseas markets.

In Asia other than mainland China, the continuous annual and semi annual decline in sales of our products is mainly attributed to the uncertainty of policy support for the solar photovoltaic industry in some Asian countries. The fluctuation of policy environment directly affects market demand, leading to a significant reduction in sales in the region.

In the European region, our sales have shown a strong growth trend. The driving force behind this growth mainly comes from the energy crisis that Europe is facing and the continuous rise in local energy prices.

Our Strengths

We believe the following strengths position us well to capitalize on the expected growth in the solar PV energy and HPC server market:

Advanced technologies provide us with a competitive advantage in the solar cable market

As a high-tech small and medium enterprise based in Zhejiang Province, we have adhered to a professional route since our establishment, focusing on product research, upgrading, and process improvement. We possess complete testing equipment and conduct comprehensive independent research and testing of special cables. Our key technologies are as follows:

•        Improved conductor structure.    We use improved conductor structures, such as compact winding or higher-grade copper wire materials, to enhance electrical properties.

•        Self-developed adhesive formulation.    To improve plastic casing quality, we use our formula that provides enhanced weather resistance and fire protection capabilities, enhancing UV resistance and longevity. This new material offers better heat and flame retardant properties, reducing potential damage caused by fires while adding extra safety measures.

•        Efficient waterproofing technology.    We employ efficient waterproofing technology and better sealing techniques to prevent wire damage from rainwater.

•        Enhanced shielding capabilities.    We provide cables with enhanced shield performance, which helps prevent electromagnetic interference and other factors affecting communication effectiveness.

As of the date of this prospectus, our R&D team had 13 members, accounting for 9.92% of our staff. We own 47 patents, including 33 utility model patents, 6 invention patent and 7 design patents in the PRC. We believe our investment in R&D and our advanced technologies reserves enhanced our competitiveness in the solar cable market.

Valuable brand and long-term and stable relations with customers

In the PV industry, customers carefully select cable suppliers through a thorough process. Approved suppliers undergo quality evaluations, technical assessments, capacity tests, reliability checks, price discussions, sample creation, pilot installations, and mass production. Once a cable supplier successfully navigates these steps and becomes part of the end customer’s supply chain, the stable business relationship will likely persist due to the high cost associated with changing suppliers, provided the supplier maintains reliable product quality and delivery capabilities.

Ningbo Pntech has 13 years of experience in developing, manufacturing and selling high-quality solar PV products and services. We believe our brand is well-recognized, and that we have built long-term relationships with many of our customers. Ningbo Skycorp and its subsidiaries also have long-term purchase agreements with our major customers of HPC servers. We believe that our customers value us because of our skilled service and quick response mechanism, and the fact that we acquired new customers by referrals from our existing customers, indicating our customer loyalties. In fiscal year 2022, we started entering into sales contracts to supply energy storage systems for the European market.

Robust quality control and technology innovation ensure our competitive edges and premium products

Cables require high performance and reliability standards to adapt to varied working environments. External organizations like TÜV conduct regular inspections and market checks, prompting continuous process improvements, cost reduction, overcoming technical barriers, and enhancing our competitiveness. With our R&D experience, continuous technological upgrading, and strict quality control process, we provide quality and reliable PV products.

We were one of the Chinese companies to earn European Union TÜV PV cable manufacturing credentials in the PV industry, and we hold national certifications from the China Quality Certification Center. These certificates demonstrate our capability to offer high-quality PV products. Our manufacturing process follows the ISO standards and European Union TÜV standards, which ensure safety, quality, and sustainability. We also have a professional R&D team conducting technological innovation and new product development to enable us to improve our products.

Comprehensive and efficient production management system ensures quality and efficiency

After exploring new energy cable businesses extensively, we’ve developed comprehensive and efficient management systems covering finance, administration, procurement, production, sales, engineering, device, and inspection control. Our goal is to uphold high levels of management and product quality. Additionally, we actively apply advanced management concepts and enhance corporate standards and product quality through ISO9001:2015 certification. Through our production management, we efficiently coordinate from order placement to aftersales service, ensuring low-cost, flexible operations and high-quality output, ultimately improving our overall competitiveness.

Offering comprehensive experience to our customers

The high efficiency and long life of PV products is one of the main reasons for customers to choose PV products. At the same time, customers also put forward higher requirements for the appearance design and convenience of use of PV products. We plan to further create customized products by combining customers’ various needs with our sale of solar PV products.

Customers also expressed high demand on the after-sales service of PV products. Responding to customers’ problems and needs in a timely manner and providing professional technical support and maintenance services are important expectations of customers for solar PV enterprises. Therefore, we intend to strengthen the training and construction of after-sales service teams to improve service quality and enhance customer satisfaction.

In the solar PV industry, customers are highly sensitive to the product price, it is awarded that customers tend to believe that nowadays the price of PV products is relatively high, but they may accept the price if it’s in a reasonable range. Therefore, PV companies should set prices reasonably and provide competitive product prices to meet the needs of customers. In addition, we intend to enhance our brand recognition by improving after-sale services, referral programs, and media promotion as well.

Experienced and visionary management team

Our founder, Chairman of the Board, and Chief Executive Officer, Mr. Weiqi Huang, is an entrepreneur with over 13 years of experience in solar PV industries. He has an outstanding understanding and vision for the solar energy industry. He also has a deep passion for green energy and is committed to helping with the green planet building by delivering environment-friendly solar PV products.

Our management team has been selected based on values emphasizing the importance of standardized operations, teamwork, cohesiveness, continuous learning, and performance excellence. It places stringent quality control on our products and services. They strive to keep abreast of the development of solar energy and data-center operations and their professional knowledge and views on the trending topics in these areas to promote our brand.

Our Strategies

Invest in business expansion

Ningbo Skycorp and its subsidiaries plan to introduce two new product lines and innovate within these lines in late 2024, including junction boxes and smart junction boxes, as well as intelligent solar charging boxes, which are designed to enhance customer loyalty and market penetration. These products will provide customers with innovative solutions that cater to their specific needs for smart solar solutions, solidifying our market position and enhancing customer loyalty. The junction boxes and smart junction boxes are designed to simplify electrical connections and monitoring, improving solar module reliability and safety. By providing these products, we aim to build our reputation for quality and customer satisfaction, which, we believe, will encourage customers to continue using our products and services. The intelligent solar charging boxes, on the other hand, offer a convenient solution for electric vehicle (EV) drivers. These boxes combine solar power generation with EV charging, providing a sustainable and environmentally friendly way for EV drivers to charge their vehicles. We believe these new product lines will generate long-term income for our Company through stable cash flow of charging expenses.

Continue to enhance our customized products and brand recognition

We plan to further create customized products by combining customers’ various needs with our sale of solar PV products and HPC servers. In addition, we intend to enhance our brand recognition by improving after-sale services, referral programs, and media promotion. Customized solutions are integral to our sales strategy, as they allow us to offer unique solutions that meet specific customer needs. With our solar PV products, we can provide clean and sustainable energy solutions, while our HPC servers offer the power and efficiency required for complex data processing and analysis. By combining these two product lines, we can create customized green computing systems that integrate solar PV systems with HPC servers, providing customers with a complete solution that addresses their green energy needs and data processing requirements. This combination not only meets customer needs but also helps us strengthen our market presence.

Increase efficiency by development of technologies

It is crucial for our success to keep up with advances and changes in solar PV technology. Our research and development activities currently focus on the finalization of the development of the solar energy storage systems.

Our R&D strategy focuses on developing our key technologies and innovations in-house, where we benefit from the expertise of our highly qualified R&D team. It ensures that our solar PV products’ key technologies and innovations reflect our core values and vision of sustainable and green energy generation. As of the date of this prospectus, Ningbo Skycorp and its subsidiaries own 47 patents regarding our solar PV products and apply them in our manufacturing and product offerings. However, we also involve companies in the solar PV industry in our R&D activities and have established, or are in the process of selecting, several partnerships with suppliers and service providers that develop and will supply specific components for our products. This approach allows us to leverage the expertise and know-how of established market players in our R&D processes.

Refine talent development processes for increasing team competitiveness

We plan to incentivize staff development by providing positive work environments and attracting employees with innovation, technical expertise, marketing know-how, and wide-ranging management skills. Improve efficiency and team cohesion through ongoing targeted training and workplace positivity.

Our Products and Services

Solar PV Products

Ningbo Skycorp and its subsidiaries offer the following solar PV products used in solar energy generation scenarios.

Solar Cables

Cables are used to connect the components of a PV system and come in various types. Typically, it connects four parts: the solar panel, the inverter, the charge controller, and the batteries.

We offer low smoke halogen-free cross-linked polyethylene insulated, polyethylene sheathed cables for PV power generation systems.

This product emits little smoke and innocuous gas without halogen when combustion. It can significantly reduce the damage to the instruments and body as the fire occurs. Therefore, it is widely used in high-rise buildings, hospitals, large-sized libraries, gymnasiums, disaster prevention commands, dispatch buildings, stations, civil airfields, passenger waiting rooms, cultural relics, subways, underground shops, or crowded public concourses.

Solar Connectors

Connectors are primarily used in solar power applications to connect solar panels together in arrays. They offer compatibility between power interfaces for different manufacturers.

MC4 solar connector is essential for linking components, sink boxes, and inverters, assembled between circuits blocked or isolated from each other within a circuit, allowing current to flow and enabling the circuit to perform its intended function. We provide MC4 solar connector with the following features:

•        High current and high voltage load capacity;

•        Lower contact resistance;

•        Waterproof and dustproof;

•        Easy installation;

•        High and low-temperature resistance;

•        Fire and corrosion resistance; and

•        UV resistance.

Hybrid Energy Storage System

Hybrid energy storage system is a high-performance and highly reliable intelligent energy storage product designed to provide homes with cleaner, more reliable, and more economical energy solutions. The system uses lithium-ion battery technology, which has advantages such as high efficiency, long lifespan, and high safety, and can effectively balance household electricity loads, optimize solar power generation efficiency, and provide backup power protection during power outages. In addition, the product also has an intelligent networking function. Users can monitor household electricity consumption and energy storage system status anytime and anywhere through the mobile app, realizing more intelligent and convenient energy management.

The hybrid energy storage system includes a hybrid inverter and an energy storage battery. We purchase hybrid inverters and energy storage batteries from third-party suppliers, and subsequently resell these products to customers under their brands. Accordingly, we do not engage in the manufacturing of hybrid inverters or energy storage batteries but act as a brand distributor for these products. The most popular hybrid inverters are single-phase 5KW, 6KW, three-phase 8KW, 10KW, and 12KW. Most customers choose 5KWH and 10KWH energy storage batteries.

The revenues derived from Solar PV products were $20,168,103, accounting for 89.70% of the total revenues, and $14,192,751, accounting for 63.76% of the total revenues, during the six months ended March 31, 2024 and 2023, respectively.

The revenues derived from Solar PV products were $36,675,752, accounting for 71.88% of the total revenues, and $24,540,222, accounting for 39.49% of the total revenues, during the fiscal years ended September 30, 2023 and 2022, respectively.

HPC Servers

Ningbo Skycorp, Zhejiang Skycorp and Ningbo Dcloud Information provide our customers with brand new and used GPU servers and HPC servers through extensive cooperation with multiple ASIC chip manufacturers. We expect to attract potential customers who may be looking for clean energy alternatives and to market our solar energy-related products and service customers through the provision of HPC servers.

GPU servers are one type of HPC servers, and they help reduce the workload of the CPU of a system by separating tasks by reducing graphic processing for CPUs. GPU servers improve not only visual feelings but also reduce overall computer workload. The main application scenarios for GPU servers are the convergence of simulation, data analytics, and artificial intelligence data processing.

HPC/AI servers as the basement of high-performance computing platforms, using the heterogeneous chip platform. Traditional servers use CPU to run calculation, but HPC/AI servers use “CPU+GPU/FPGA/ASIC” chips platform to compute, efficiency is highly improved under such chip platform.

Source: Caitong Securities

An increasing number of HPC server manufacturers use GPU/FPGA/ASIC chips platforms in their server products. Take our GPU server iPollo V1 as an example, Model V1 has a maximum hash rate of 3.6Gh/s for a power consumption of 3100W, and its hash rate equals 50 PCs Nvidia 3080 laptops. Such GPU servers are widely used to provide computing support for Web3 protocols. Web3 is intended to rebuild the Internet on open, decentralized, and license-free protocols. A distributed infrastructure needs to be built as a base layer to achieve the goal of decentralized protocols. The decentralized framework includes building an infrastructure for video-streaming applications, rendering 2D and 3D objects, and cloud servers. These services have in common that they rely on distributed participant networks to provide GPU computing power services.

HPC Server Accessories

Apart from promoting and providing customers with HPC servers, we also offer HPC server accessories, including mobile data centers, server fans, and control boards.

20FT mobile data center

Power Supply Unit

Server Fan

Control board

In the past 13 years, we have provided more than 250,000 HPC servers globally.

HPC servers and accessories revenues were $2,315,498, accounting for 10.29% of the revenues, and $8,066,587, which accounted for 36.24% of the revenues, during the six months ended March 31, 2024 and 2023, respectively.

HPC servers and accessories revenues were $14,139,923, accounting for 27.71% of the revenues, and $34,519,422, which accounted for 55.54% of the revenues, during the fiscal years ended September 30, 2023 and 2022, respectively.

Manufacturing

Ningbo Pntech has over 13 years of experience manufacturing solar PV products, specifically focusing on solar cables and connectors. The manufacturing philosophy focuses on quality, continuous improvement, flexibility, and high operational efficiency, and we take a lean manufacturing approach to optimize operational efficiency and product quality continuously.

Zhejiang Pntech leases 4,800 square meters of property in Haishu District of Ningbo, Zhejiang Province, for manufacturing solar PV products. The factory has four sets of fully automated PV cable production lines, eight sets of multi-functional PV terminal machines, and other specialized PV accessories production equipment, offering up to 10 million sets of PV connectors and 80,000 km of PV cables annually. We believe these accumulated production experiences and professional facilities would allow us to effectively control critical manufacturing and sourcing processes and product quality and minimize the required capital expenditures.

While we are committed to manufacturing solar cables and connectors, we do not manufacture other components, such as hybrid inverters or energy storage batteries, which are instead sourced from third-party suppliers. We have been cooperating with and maintaining long-term relationships with several PV cable raw material suppliers regarding the product supply chain. At the same time, we also focus on expanding new supply chain relationships to prevent operational risks from the high concentration of suppliers.

Quality Control

Our products follow European International Electrotechnical Commission and TÜV production standards. Ningbo Pntech obtained TÜV Certificate in 2014 and Zhejiang Pntech obtained the ISO9001:2015 Quality Management System Certificate in 2022. We have established a quality control system and strict standard operating procedures to minimize quality problems:

•        In the preliminary design and development stage, we will maintain close communication with customers, submit the design plan to customers for confirmation, adjust the design based on customers’ feedback and then put the design into production;

•        During product production, we conduct secondary testing on the products, such as PV voltage resistance test, PV cable’s conventional 6,500V spark machine test, and vertical combustion test to ensure that the products work properly; and

•        Before shipping, we proceed with the final test on subjects such as the detection of wire diameter roundness/color difference/conductor resistance, and other basic testing of PV cables.

Sales and Marketing

Our operating companies in China actively engage in targeted online and offline marketing through various channels to enhance our brand recognition further and acquire customers.

Ningbo Skycorp and its subsidiaries mainly through customer referrals for solar PV products to promote sales. In addition, attending industrial exhibitions per year, such as SNEC International Photovoltaic Power Generation and Smart Generation and Smart Energy Conference & Exhibition at Shanghai and Solar PV World Expo, also helps the exposure of solar PV products and technologies, expands marketing channels, promotes sales and spreads the brand. We expect to attract potential customers who may be looking for clean energy alternatives and to market our solar energy-related products and service customers through the provision of HPC servers.

For HPC servers, Ningbo Skycorp and its subsidiaries use websites, official accounts on social media platforms, such as Facebook, Twitter, and LinkedIn, and online stores on e-commerce platforms, such as Global sourcing, to approach potential customers.

As of September 30, 2024, we had an aggregate of more than 7,670 customers in our customer database who had used or tried our solar PV products and HPC servers.

Research and Development

We believe it is and will be crucial for our success to keep up with advances and changes in solar PV technology. Our R&D activities currently focus on the finalization of the development of the solar energy storage systems.

Our R&D strategy focuses on developing our key technologies and innovations in-house, where we benefit from the expertise of our highly qualified R&D team. It ensures that our solar PV products’ key technologies and innovations reflect our core values and vision of sustainable and green energy generation. As of the date of this prospectus, Ningbo Skycorp and its subsidiaries own 47 patents regarding our solar PV products and apply them in our manufacturing and product offerings. However, we also involve companies in the solar PV industry in our R&D activities and have established, or are in the process of selecting, several partnerships with suppliers and service providers that develop and will supply specific components for our products. This approach allows us to leverage the expertise and know-how of established market players in our R&D processes.

Customers

We adopt business-to-business (“B2B”) business models, and our customers are in the solar PV installation and application and HPC server industries, mainly from Asia and Europe. In the solar PV industry, we believe that we have established and maintained stable and reliable supply chain cooperation relationships with over 3,300 quality end customers, most of whom have business relationships and have made purchases with us for over three years.

Solar PV Business

For the six months ended March 31, 2024 and 2023, the revenue share of our solar PV business customers accounting for 89.7% and 63.8% of the total revenues, respectively, and the solar PV revenue share of our top ten customers for the six months ended March 31, 2024 and 2023 was 21.7% and 11.2%, respectively.

In the fiscal years 2023 and 2022, the revenue share of our solar PV business customers accounting for 71.9% and 39.5% of the total revenues, respectively, and the solar PV revenue share of our top ten customers in the fiscal years 2023 and 2022 was 2.2% and 9.8%, respectively.

HPC Server Business

For the six months ended March 31, 2024 and 2023, the revenue share of our HPC business customers accounting for 10.3% and 36.2% of the total revenues, respectively, and the HPC revenue share of our top ten customers for the six months ended March 31, 2024 and 2023 was 10.3% and 35.3%, respectively.

For the fiscal year ended September 30, 2023, our HPC server business revenue accounted for 27.7% of the total revenue compared to 55.5% for the fiscal year ended September 30, 2022. We have two major customers for each of these two years. Revenues from these customers accounted for 83.9% and 71.8% of the HPC server business

revenue for the fiscal years ended September 30, 2023 and 2022, respectively. The two customers entered into multiple standard HPC sales agreements with the operating subsidiaries during the fiscal years 2023 and 2022, including provisions regarding deliverables, payment, confidentiality, warranties, indemnification, and governing law.

The overall percentage of revenue from customers accounting for more than 10% of total revenue decreased by 16.63% in fiscal 2023 compared to fiscal 2022 due to our ongoing efforts to expand new customer groups and reduce customer concentration risk. In addition, we plan to launch new solar power products and solutions, such as solar energy storage systems, security systems, and lamp systems, which we believe would further reduce the customer concentration risk generated by HPC server offerings.

Customer Support

Besides promoting and providing customers with HPC servers and related accessories, we also focus on bringing relevant and valuable information while advising customers on how HPC servers work and other technical consultants.

We believe customer service and satisfaction are key focus for us and contribute to our success. We provide one-stop and turn-key services to our customers to differentiate us from competitors.

Suppliers

Solar Cable and Connector Suppliers

The primary raw materials of our solar cables and connectors are copper wire, halogen-free flame-retardant sheathing, and halogen-free flame-retardant insulation material for PV cables. We generally purchase raw materials for our manufacturing from select suppliers. We screen all suppliers and components based on expected cost, reliability, warranty coverage, ease of installation, and other factors. We typically enter framework arrangements with our major suppliers that define our purchases’ general terms and conditions, including warranties, product specifications, indemnities, delivery, and other customary terms. We typically purchase raw materials from time to time based on our actual needs.

We maintain a running list of approved suppliers we can rely on if our contracted sources become unavailable. We purchase copper wire, halogen-free flame-retardant sheathing, and halogen-free flame-retardant insulation material from several long-term suppliers.

Hybrid Energy Storage System Suppliers

Our hybrid energy storage system includes a hybrid inverter and an energy storage battery. We do not manufacture hybrid inverters or energy storage batteries. Instead, we purchase these components from third-party suppliers, and resell them under their brands. We screen hybrid energy storage system suppliers based on factors such as reliability, warranty coverage, compatibility with our product specifications, and cost efficiency. We typically enter into framework agreements with these suppliers that outline the terms and conditions of purchase, including warranties, product specifications, indemnities, delivery, and other customary terms.

HPC Servers Suppliers

The primary products in our HPC server business are various models of HPC servers. We purchase servers from several qualified manufacturers to ensure consistent quality, timely delivery, and performance, including Shanghai, Chongqing, Guangdong Province, and Fujian Province. We regularly evaluate the grade of our suppliers and keep a list of approved suppliers selected from factors such as product quality, price, and supply capacity.

Currently, we maintain a stable supply channel for HPC servers. We sign one-year purchase contracts with our suppliers based on actual needs to ensure stable and secure supplies.

Competition

Competitive Landscape of the Solar PV Energy Industry

According to China PV Industry Development Roadmap published by China Photovoltaic Industry Association, in the six months ended March 31, 2024, domestic PV installed 102 GW, an increase of 31% period-over-period. With policy support and technological progress, Chinese enterprises have gradually improved their technical level

and production capacity, and some of them have become important suppliers in the domestic market. There are many participants in the solar PV energy industry in China, and industry competition will intensify as more markets develop their local PV manufacturing supply chains.

Competitive Landscape of the HPC Server Industry

The global HPC servers market is concentrated with a few large competitors, and most leading players are in the US. According to Hyperion Research’s annual pre-ISC HPC market update presented in May 2024, the overall HPC market was flat in 2023 at $37.31 billion, the top three manufacturers are HPE, Dell and Lenovo, with a 2023 market share reaching 31.50%, 24.46% and 8.48%. The market share of the first three factories is more than 64.58% of the overall market of HPC servers, and they have formed the oligarchy effect of the market with the advantage of comprehensive strength. Their position is difficult to change in a short time.

Intellectual Property

We regard our patents, copyrights, trademarks, domain names, and similar intellectual property as critical to our success. Protection of our intellectual property is a strategic priority for our business. We rely on a combination of protections provided by patents, copyrights, trademark, and trade secret laws, and confidentiality agreements, and non-compete agreements with our employees to protect our proprietary rights. As of the date of this prospectus, Ningbo Skycorp and its subsidiaries had registered 47 patents, 33 trademarks, 25 copyrights, and 1 domain name in the PRC.

Patent

As of the date of this prospectus, Ningbo Skycorp and its subsidiaries have registered a total of 47 patents, including 34 utility patents, 6 invention patent and 7 design patents in the PRC.

Trademark

As of the date of this prospectus, Ningbo Skycorp and its subsidiaries have registered a total of 33 trademarks in the PRC: