Company Overview - The company qualifies as an "emerging growth company" with less than US$1.235 billion in revenue for the last fiscal year, allowing for reduced reporting requirements [185]. - The company has over 10 years of experience in the personal care electrical appliance industry, focusing on sourcing and wholesaling products for international brand owners [191]. - The company has a strong presence in the personal care electrical appliances industry with a 10-year operating history, emphasizing hair styling products [247]. - The company has built a strong reputation in the industry, attracting renowned brand owners as major customers due to its established history and expertise [247]. - The management team has over 30 years of combined experience in the personal care and lifestyle electrical appliances industry, contributing to the company's growth [251]. Revenue Breakdown - Sales of hair styling series accounted for 62%, 48%, and 48% of total revenue for the years ended March 31, 2023, 2024, and 2025, respectively, with hair dryers contributing approximately 44%, 37%, and 25% of those sales [193]. - Revenue from the trimmer series represented 19%, 34%, and 43% for the years ended March 31, 2023, 2024, and 2025, respectively, with 2-in-1 face shaver and nose trimmer sets making up 32%, 15%, and 12% of trimmer sales [197]. - The eyelash curler series contributed approximately 3%, 1%, and 1% to total revenue for the years ended March 31, 2023, 2024, and 2025, respectively [200]. - The reset brush represented 55%, 65%, and 27% of sales in the other personal care appliance series for the years ended March 31, 2023, 2024, and 2025, respectively [202]. - The company generated 91.3%, 74.1%, and 64.0% of total revenue from Koizumi Seiki Corp. for the years ended March 31, 2023, 2024, and 2025, respectively [207]. Supplier and Customer Relationships - Payments to Zhongshan Raytech accounted for 83.1%, 88.5%, and 88.2% of total purchases for the years ended March 31, 2023, 2024, and 2025, respectively [210][211]. - As of March 31, 2025, two customers accounted for 50.9% and 49.1% of the Company's total accounts receivable respectively [430]. - For the year ended March 31, 2025, two major customers accounted for 64.0% and 29.5% of the Company's total revenues respectively [431]. - As of March 31, 2025, two manufacturers accounted for 82.6% and 14.4% of the total balance of accounts payable [432]. - For the year ended March 31, 2025, one manufacturer accounted for 88.2% of the total purchases [434]. Market Trends and Growth - The global personal care appliance market was valued at approximately US$22.9 billion in 2024 and is projected to reach US$39.4 billion by 2029, indicating a strong growth momentum [219]. - The Asia-Pacific region is a key growth driver, with China, India, and Japan leading the demand for personal care appliances due to their large consumer bases and rising middle class [221]. - The personal care appliance market is experiencing rapid diversification, with emerging products in oral care and hair care addressing advanced hygiene needs and incorporating innovative technologies [230]. - Consumers are increasingly prioritizing premium, high-quality products, leading to a trend toward premiumization in the personal care appliance market [241]. - The industry is characterized by a structural shift driven by socioeconomic development, evolving consumer behavior, and the influence of social media platforms [225]. Marketing and Expansion Strategies - The company aims to expand its market presence from Hong Kong to the U.S., Europe, and Asia, with limited market studies conducted so far [253]. - The company plans to increase investments in sales and marketing, particularly targeting the U.S., Europe, and Asia markets [254]. - Social-driven marketing and omnichannel distribution strategies are becoming central to brand growth, leveraging platforms like Instagram and livestream commerce for product promotion [234]. Financial Position and Risks - As of March 31, 2025, cash balance was HKD84,850,995 (approximately US$10,906,438) held at reputable financial institutions in Hong Kong [426]. - The Company has designed credit policies to minimize exposure to credit risk, with accounts receivable being short term in nature [427]. - The Company is exposed to foreign currency risk primarily through sales denominated in currencies other than the functional currency, primarily US$ [436]. - The Company believes there is no significant credit risk associated with cash and cash equivalents held in Hong Kong [426]. - The Company conducts credit evaluations on customers and generally does not require collateral [427]. Operational Details - The company's principal executive office is located in Hong Kong, occupying 1,343 square feet, with a monthly rent of HKD25,000 (approximately US$3,213) [266]. - Operating lease expenses amounted to HKD300,000 (approximately US$38,560) for the years ended March 31, 2024, and 2025 [267]. - The company does not own any trademarks or patents for the products developed, as these belong to the customers [261][263]. - The company has established a stringent quality control system to ensure compliance with international safety standards [250]. - As of March 31, 2025, the company has 6 employees, with no representation by a labor union [265].
Raytech Holding Limited(RAY) - 2025 Q4 - Annual Report