Core Viewpoint - The article discusses the recent IPO of Huato Financial, led by a post-95 entrepreneur Zhou Kai, highlighting the contrast between the company's initial stock surge and its subsequent decline in market value, raising questions about its true worth and business model [2][4][11]. Company Overview - Huato Financial is a holding company registered in the British Virgin Islands, primarily engaged in securities brokerage and fintech services through its subsidiaries in Hong Kong [6]. - The company operates both traditional brokerage services and emerging fintech solutions, including a SaaS platform called "Brokerage Cloud" aimed at digitizing operations for small and medium-sized brokerages [7]. Business Development - Zhou Kai founded the company in 2018 and acquired Huato Securities International in 2021, initially aiming to create a large internet brokerage targeting retail investors [8][9]. - Due to regulatory challenges, the company shifted its strategy from traditional brokerage to providing "Brokerage Cloud" services, and later to the concept of being a "brokerage for AI" following the rise of AI technologies in 2023 [9][20]. Financial Performance - For the fiscal years ending March 31, 2023, and 2024, Huato Securities reported revenues of $574,000 and $1,005,580, respectively, representing a year-on-year growth of 75.2%, while net profits were $308,000 and $250,000, showing a decline of 19.0% [12]. - The primary revenue source is brokerage and commission income, which increased significantly from approximately $210,000 in 2023 to about $820,000 in 2024, a rise of approximately 295.6% [12][15]. Revenue Concentration - The substantial growth in brokerage and commission income for the fiscal year 2024 was largely driven by a single bond distribution project, contributing about $580,000, or 70.7% of total brokerage income [15]. - The company exhibits high customer concentration, with the top five clients accounting for 89.7% of total revenue in 2024, and a staggering 97.6% in 2023, indicating a reliance on a few key clients, particularly related parties [16][17]. AI Strategy and Market Position - Zhou Kai has positioned AI as a core strategic direction for the company, claiming it has the potential to transform the financial industry [19][20]. - However, the company's current AI applications are limited to auxiliary functions such as customer service and risk control, with no substantial commercialization of AI trading capabilities yet [21][24]. Technology and Competitive Landscape - Huato Financial's technology strategy relies heavily on external partnerships, lacking proprietary technology or patents in the AI domain, raising questions about its competitive edge [22][24]. - The company's "Brokerage Cloud" service, while marketed as low-cost and easy to integrate, faces challenges due to its replicable technology and low entry barriers for competitors [24]. Conclusion - The article suggests that while Huato Financial has garnered attention with its AI and fintech narrative, it faces significant challenges related to dependency on a few clients, lack of proprietary technology, and the need for a more robust business model [26][27].