XML 34 R23.htm IDEA: XBRL DOCUMENT v3.25.2
RISKS AND UNCERTAINTIES
 3 Months Ended
Jun. 30, 2025
Risks and Uncertainties [Abstract]  
RISKS AND UNCERTAINTIES

17. RISKS AND UNCERTAINTIES

 

(a) Economic and Political Risks

 

The Company’s operations are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC economy.

 

The Company’s operations in the PRC are subject to special considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation.

 

(b) Foreign Currency Translation

 

The Company’s reporting currency is the U.S. dollar. The functional currency of the parent company is the U.S. dollar and the functional currency of the Company’s operating subsidiaries is the Chinese Renminbi (“RMB”). For the subsidiaries whose functional currencies are the RMB, all assets and liabilities are translated at exchange rates at the balance sheet date, which was 7.17 and 7.26 as of June 30, 2025 and March 31, 2025, respectively. Revenue and expenses are translated at the average yearly exchange rates, which was 7.231 and 7.004 for the three months ended June 30, 2025 and 2024, respectively. Equity is translated at historical exchange rates. Any translation adjustments resulting are not included in determining net income but are included in foreign exchange adjustments to other comprehensive loss, a component of equity.

 

 

(c) Concentration Risks

 

The followings are the percentages of accounts receivable balance of the top customers over accounts receivable for each segment as of June 30, 2025 and March 31, 2025.

 

Garment manufacturing segment

 

   June 30, 2025   March 31, 2025 
Customer A   100.0%   100.0%

 

The high concentration as of June 30, 2025 was mainly due to business development of a large distributor of garments.

 

Logistics services segment

 

   June 30, 2025   March 31, 2025 
Customer A   21.7%   20.2%
Customer B   16.3%   17.6%
Customer C   12.0%   17.6%
Customer D   6.0%   5.4%
Customer E   5.5%   5.9%

 

Property management and subleasing segment

 

There was no account receivable for the property management and subleasing segment as of June 30, 2025 and March 31, 2025.

 

Concentration on customers

 

For the three months ended June 30, 2025, three customer from the logistics services segment provided more than 10% of total revenue of the Company, representing 45.4% of total revenue of the Company for the three months.

 

For the three months ended June 30, 2024, one customer from the logistics services segment provided more than 10% of total revenue of the Company, representing 16.1% of total revenue of the Company for the three months.

 

Concentration on suppliers

 

The following tables summarized the purchases from five largest suppliers of each of the reportable segments for the three months ended June 30, 2025 and 2024.

 

   Three months ended 
   June 30, 
   2025   2024 
Garment manufacturing segment   100%   Nil%
Logistics services segment   100.0%   100.0%
Property management and subleasing   Nil%   Nil%

 

(d) Interest Rate Risk

 

The Company’s exposure to interest rate risk primarily relates to the interest expenses on our outstanding bank borrowings and the interest income generated by cash invested in cash deposits and liquid investments. As of June 30, 2025, the total outstanding borrowings amounted to $728,212 (RMB5,222,826) with various interest rate from 4.34% to 16.2% p.a. (Note 12)