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Share Based Compensation | 12 Months Ended
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Dec. 31, 2023
Share-Based Payment Arrangement [Abstract] |
Share Based Compensation | 16. Share based compensation In March 2016, the Group’s shareholders and board of directors adopted the Amended and Restated Share Incentive Plan (“2016 Plan”) to grant share-based compensation awards to attract, motivate, retain and reward certain directors, officers, employees and other eligible persons and to further link the interests of award recipients with those of the Group’s shareholders. The maximum aggregate number of ordinary shares that may be issued under the 2016 Plan is 21,920,964 ordinary shares. In 2021, the Group adopted the 2021 share incentive plan (“2021 Plan”), to promote the success and enhance the value of the Group by linking the personal interests of the directors, employees, and consultants to those of the Group’s shareholders and by providing such individuals with an incentive for outstanding performance to generate superior returns to the Group’s shareholders. The maximum aggregate number of ordinary shares that may be issued under 2021 Plan is 6,021,619. The Group amended and restated 2021 Plan in March 2023 to expand the award pool to 12,150,080 shares, the source of which can be either new shares or treasury shares. Share options Under the 2016 Plan, options granted to employees vest upon satisfaction of a service condition, which is generally satisfied over four years. Additionally, the 2016 Plan includes a condition where employees can only exercise vested options upon the occurrence of the Company's ordinary shares becoming listed securities, which substantially creates a performance condition ("IPO Condition") that had not been met prior to the Company's IPO. The Group granted 4,074,384, 1,726,988 and 6,343,363 share options with IPO condition to certain employees in 2019, 2020 and in April and June 2021, respectively. Therefore, the Group has not recognized any stock-based compensation expenses related to the options granted until June 2021 the performance condition has been met by the IPO completion. The Group granted 525,706, 3,559,433 and 836,164 share options with service condition to certain employees after completion of IPO in 2021, 2022 and 2023, respectively. The options expire in ten years from the date of grant. In determining the fair value of the stock options, the binomial option pricing model was applied. The key assumptions used to determine the fair value of the options at the respective grant dates in 2021, 2022 and 2023 were as follows:
|  | For the years ended December 31,
|  | 2021 |  | 2022 |  | 2023
Expected volatility |  | 48.47%~48.70% |  | 47.80%~48.20% |  | 49.00%~51.00%
Risk-free interest rate (per annum) |  | 1.35%~1.62% |  | 1.51%~2.94% |  | 2.40%~2.97%
Exercise multiples |  | 2.2~2.8 |  | 2.2~2.8 |  | 2.2~2.8
Expected dividend yield |  | 0.00% |  | 0.00% |  | 0.00%
Fair value of underlying ordinary shares |  | RMB 40.61~RMB 109.73 |  | RMB 19.43~RMB 62.05 |  | RMB 18.80~RMB 32.19
Fair value of share option |  | RMB 39.98~RMB 109.10 |  | RMB 18.39~RMB 61.01 |  | RMB 18.10~RMB 31.48
The Group estimated expected volatility by reference to the historical price volatilities of ordinary shares of comparable companies over a period close to the contract term of the options. The Group estimated the risk-free interest rate based on the yield to maturity of U.S. government bonds at grant date with a maturity period close to the contract term of options, adjusted by country risk differential between U.S. and China. The Group estimated exercise multiples based on empirical research on typical employee stock option exercising behavior. The dividend yield was estimated as zero based on the plan to retain profit for corporate expansion and no dividend will be distributed in the near future. The Group determined the fair value of ordinary shares underlying each share option grant based on estimated equity value and allocation of it to each element of its capital structure. Upon the completion of IPO, the Company used the closing price of ordinary shares on the grant date as the fair value of ordinary share on the grant date. The assumptions used in share-based compensation expenses recognition represent the Group’s best estimates, but these estimates involve inherent uncertainties and the application of judgment. If factors change or different assumptions are used, the share-based compensation expenses could be materially different for any period. 16. Share based compensation—(Continued) Share options—(Continued) The following table summarized the Group’s share option activities under the Option Plans for the year ended December 31, 2023:
|  | Number of options |  |  | Weighted average exercise price per share |  |  | Weighted average grant date fair value per share |  |  | Weighted average remaining contractual life |  |  | Aggregate intrinsic value |
|  |  |  |  | RMB |  |  | RMB |  |  | Years |  |  | RMB |
Outstanding as of December 31, 2022 |  |  | 16,960,117 |  |  |  | 0.64 |  |  |  | 28.73 |  |  |  | 6.66 |  |  |  | 305,280 |
Granted |  |  | 836,164 |  |  | 0.70 |  |  |  | 25.45 |  |  |  |  |  |  |
Forfeited |  |  | (266,409 | ) |  | 0.63 |  |  |  | 42.53 |  |  |  |  |  |  |
Exercised |  |  | (3,648,341 | ) |  | 0.70 |  |  |  | 27.78 |  |  |  |  |  |  |
Outstanding as of December 31, 2023 |  |  | 13,881,531 |  |  |  | 0.70 |  |  |  | 31.64 |  |  |  | 5.90 |  |  |  | 271,092 |
Vested and expect to vest as of December 31, 2023 |  |  | 13,881,531 |  |  | 0.70 |  |  |  | 31.64 |  |  |  |  |  |  |
Exercisable at December 31, 2023 |  |  | 9,532,499 |  |  |  | 0.70 |  |  |  | 27.59 |  |  |  | 5.14 |  |  |  | 186,160 |
The weighted-average grant-date fair value of options granted during the year 2021, 2022 and 2023 was RMB 57.05, RMB 22.46 and RMB 25.45, respectively. The total intrinsic value of options exercised during the years ended December 31, 2021, 2022 and 2023, was RMB 16,372, RMB 135,949 and RMB 101,351, respectively. For the year ended December 31, 2023, share-based compensation expenses related to options of RMB 133,291 has been recognized. As of December 31, 2023, there were RMB 113,035 of total unrecognized compensation expenses related to options which is expected to be recognized over a weighted average period of 1.14 years. Restricted share units In April 2021, the Group granted a total of 2,964,091 Restricted Share Units ("RSUs") to the management team under 2021 plan, which is vested immediately upon grant. In July 2021, the Group granted a total of 16,500 RSUs under 2016 plan to the management team and the vesting period is three years. In 2022, the Group granted a total of 172,333 RSUs to the management team under 2021 plan, among which 133,333 RSUs vested immediately upon grant, 30,000 RSUs vested on first and second anniversary date of grant and 9,000 RSUs vested on first, second and third anniversary date of grant. Compensation expense based on fair value is amortized over the requisite service period of award using the straight-line vesting attribution method. A summary of the RSUs activities for the year ended December 31, 2023 is as follows:
|  | Number of RSU |  |  | Weighted average grant-date fair value |  |  | Weighted average remaining contractual life |
|  |  |  |  | RMB |  |  | Years |
Outstanding as of December 31, 2022 |  |  | 50,000 |  |  |  | 33.81 |  |  |  | 2.17 |
Granted |  |  | — |  |  |  | — |  |  |  | — |
Vested |  |  | (20,000 | ) |  |  | 61.24 |  |  | — |
Outstanding as of December 31, 2023 |  |  | 30,000 |  |  |  | 20.53 |  |  |  | 1.77 |
16. Share based compensation—(Continued) Restricted share units—(Continued) The weighted-average grant-date fair value of RSUs granted during the year 2022 and 2023 was RMB 3,960 and nil, respectively. The total intrinsic value of RSUs vested during the years ended December 31, 2022 and 2023 was RMB 3,845 and RMB 618, respectively and total intrinsic value of outstanding RSUs as of December 31, 2023 was RMB 607. The share-based compensation expense related to RSUs of RMB 164,268, RMB 4,295 and RMB 1,111 were recognized by the Group for the years ended December 31, 2021, 2022 and 2023, respectively. As of December 31, 2023, there were RMB 670 of total unrecognized compensation expenses related to RSUs for the future period. The Group recorded share-based compensation expense of RMB 454,552, RMB 174,236 and RMB 134,402 for the years ended December 31, 2021, 2022 and 2023, respectively, which were classified in the consolidated statements of operations as follows:
|  | Years ended December 31, |
|  | 2021 |  |  | 2022 |  |  | 2023 |
|  | RMB |  |  | RMB |  |  | RMB |
Fulfillment expenses |  |  | 59,583 |  |  |  | 44,408 |  |  |  | 23,390 |
Selling and marketing expenses |  |  | 38,463 |  |  |  | 36,104 |  |  |  | 17,240 |
General and administrative expenses |  |  | 316,911 |  |  |  | 71,696 |  |  |  | 73,156 |
Technology and content expenses |  |  | 36,595 |  |  |  | 22,028 |  |  |  | 20,616 |

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