ADDENTAX GROUP CORP.

Addentax Group Corp.

Company structure

• Nevada holding company that operates primarily through PRC subsidiaries.
• PRC subsidiaries:
  • Garment manufacturing: YX and YS (both in Guangdong, China).
  • Logistics services: XKJ and PF (both in Guangdong, China).
• Consulting services provided through Yingxi HK (Hong Kong) for cross-border wealth planning, insurance coordination and related advisory services.
• Additional entities:
  • Yingxi Industrial Chain Group Co., Ltd. (YICG, Seychelles) and Yingxi HK.
  • KMFG: Keemo Fashion Group Limited (Nevada), acquired March 30, 2026; KMFG includes GW Reader Holding Limited and GW Reader Sdn. Bhd. (Malaysia) for digital publishing, plus an apparel trading business.
• Dispositions:
  • YBY (Shantou Yi Bai Yi Garment) and HX (Dongguan Hongxiang Commercial) were disposed of in 2025; HX’s disposal was classified as discontinued operations.

Core business activities (continuing operations as of March 31, 2026)

1. Garment manufacturing

   • Operated through two wholly owned PRC subsidiaries (YX and YS) in Guangdong.
   • Produces garments for high-end fashion brands sold to wholesale customers in China.
   • End-to-end process includes design, fabric sourcing, patterning, cutting, sewing, finishing and packaging, with in-house production and logistics.
   • Channel mix for garment revenue (fiscal year ended March 31, 2026): offline sales ~50.2%, Taobao ~30.4%, WeChat ~12.2%, Douyin ~5.4%, other channels ~1.1% and ~0.6%.
   • Customer concentration (garment revenue, 2026): four customers accounted for ~21.0%, ~13.7%, ~12.4% and ~10.6% of total revenue. For 2025, two customers accounted for ~15.9% and ~15.5% of garment revenue.

2. Logistics services

   • Maintains in-house delivery capability and uses contractors as needed.
   • Operates 114 logistics points across 10 provinces and 2 municipalities, serving 45 cities.
   • Uses an in-house fleet and drivers, supplemented by subcontractors; subcontractor costs represented 7.3% of total cost of revenues in 2026 (largest subcontractor accounted for 5.2% in 2025).
   • Credit terms to customers are generally 30–90 days.

3. Consulting services

   • Provides cross-border advisory services including overseas insurance configuration, wealth and education planning, identity planning, and coordination with licensed third-party providers.
   • Acts as a coordinating and referral service; does not underwrite insurance or collect premiums.
   • Consulting revenue concentration (2026): three customers accounted for ~53.6%, ~31.6% and ~13.4% of consulting revenue.
   • No consulting revenue was generated in 2025 in the disclosed figures.
   • Services rely on third-party licensed providers, private-domain customer management, and digital tools.

4. KMFG (post-acquisition)

   • Acquired on March 30, 2026; Addentax holds approximately 62.18% of KMFG on a fully diluted voting basis.
   • KMFG’s core segments:
     • Apparel/garment trading: wholesale distribution of men’s and women’s apparel sourced from manufacturers (no owned production facilities).
     • Digital publishing: GW Reader Sdn. Bhd. (Malaysia) operates a mobile pay-per-chapter platform for global readers.
   • KMFG’s revenue contribution was not material as of March 31, 2026; management did not present KMFG as a separate material operating segment for the current period.

Financial snapshot (fiscal years ended March 31)

• Employees: approximately 61 as of March 31, 2026.
• Net income (loss):
  • Net loss of approximately $4.0 million for the fiscal year ended March 31, 2026.
  • Net loss of approximately $5.1 million for the fiscal year ended March 31, 2025.
• Other items:
  • Completed a 1-for-15 reverse stock split effective March 30, 2026.
  • The company acquired interests related to Time Is Loan Limited and Riches Family Office Limited in May–June 2026 (after the reporting period), with subsequent share exchanges through Yingxi HK.

Geography and operations

• Primary on-the-ground operations are in the PRC (Guangdong province) via YX and YS (garment manufacturing) and XKJ and PF (logistics).
• Yingxi HK handles consulting services from Hong Kong.
• KMFG operates as a Nevada holding company with a Malaysia-based digital publishing subsidiary and a separate apparel trading business in China.
• The company offers an integrated cross-border services model covering design, production, logistics and advisory services and is pursuing expansion of delivery networks, international logistics/warehousing and consulting services with a compliance-focused approach.

Intellectual property

• Owns 36 trademark registrations in the PRC via YX, protecting the "Addentax" and "ATXG" brands and related logos across multiple classes.
• Holds copyrights related to certain logo designs and owns related domain names.

Key risks and regulatory considerations

• Business operations rely on PRC-based entities and a foreign investment structure, subject to PRC laws and cross-border regulatory frameworks, including currency controls and data/cybersecurity requirements.
• Exposure to HFCAA-related risks and potential SEC actions if auditor-inspection issues arise or if cross-border regulatory actions limit U.S. access to audit materials.
• No history of dividend distributions; future distributions would depend on profitability, foreign exchange rules and PRC regulatory constraints.

Summary

Addentax Group Corp. is a Nevada holding company with primary operations in Guangdong, China, focused on garment manufacturing, logistics and cross-border consulting services. The company completed a strategic acquisition of KMFG in March 2026, adding apparel trading and digital publishing capabilities. As of March 31, 2026, Addentax employed about 61 people and reported a net loss of approximately $4.0 million for the fiscal year.