Ping An Biomedical Co (PASW) Registration Filing summary

Company overview and business model

• Operates as a holding company incorporated in the Cayman Islands, with all operations conducted through a PRC subsidiary, New Brand, headquartered in Shanghai, China.

• Provides vertically integrated supply chain management (SCM) services for the apparel industry, covering market trend analysis, product design, raw material sourcing, production, quality control, and logistics.

• Customers include brand owners, textile manufacturers, sourcing agents, and online retailers, all based in China.

• Business model is asset-light, relying on third-party vendors and contract manufacturers for production and logistics.

• Competitive strengths include rapid turnaround from design to finished garments, deep industry knowledge, and a diverse supplier network.

Financial performance and metrics

• Revenue for the year ended September 30, 2023 was RMB 82.6 million (US$11.3 million), down 27.9% from RMB 114.5 million in 2022, mainly due to lower yarn sales.

• Gross profit for 2023 was RMB 4.2 million (US$581,164), with a gross margin of 5.1%, down from 12.3% in 2022.

• Net loss for 2023 was RMB 993,937 (US$136,230), compared to net income of RMB 7.2 million in 2022.

• As of September 30, 2023, the company had a working capital deficit of RMB 9.1 million (US$1.24 million) and a total deficit of RMB 5.86 million (US$803,124).

• Cash flow from operations was negative RMB 6.08 million (US$834,000) in 2023.

Use of proceeds and capital allocation

• Net proceeds from the IPO (estimated at $8.86 million) will be allocated as follows: 20% for raw material procurement, 20% for customer acquisition and market expansion, 20% for enhancing SCM efficiency, 10% for sustainable materials, and 30% for general working capital.

• No proceeds will be received from the resale of shares by selling shareholders.