Greenland Technologies Holding (GTEC) risk factors, FY2024 10-K

Risks Related to our Business and Industry

1. 01Our subsidiaries’ business operations are cash intensive, and our subsidiaries’ business could be adversely affected if we fail to maintain sufficient levels of liquidity and working capital
2. 02We grant relatively long payment terms for accounts receivable which can adversely affect our cash flow
3. 03Our subsidiaries face short lead-times for delivery of products to customers. Failure to meet delivery deadlines could result in the loss of customers and damage to our reputation and goodwill
4. 04Our subsidiaries face intense competition, and, if our subsidiaries are unable to compete effectively, we may not be able to maintain profitability
5. 05Our revenues are highly dependent on a limited number of customers and the loss of any one of our subsidiaries’ major customers could materially and adversely affect our growth and revenues
6. 06As our subsidiaries expand their operations, they may need to establish a more diverse supplier network for raw materials. The failure to secure a more diverse supplier network could have an adverse effect on our financial condition
7. 07To remain competitive, our subsidiaries have introduced new lines of business, including the production and sale of electric industrial heavy equipment. If these efforts are not successful, our results of operations may be materially and adversely affected
8. 08New lines of business, including the production and sale of electric industrial heavy equipment, may subject us and our subsidiaries to additional risks
9. 09Volatile steel prices can cause significant fluctuations in our operating results. Our revenues and operating income could decrease if steel prices increase or if our subsidiaries are unable to pass price increases on to their customers
10. 10We are subject to various risks and uncertainties that might affect our subsidiaries’ ability to procure raw materials
11. 11Our subsidiaries may lose their competitive advantage, and their operations may suffer, if they fail to prevent the loss or misappropriation of, or disputes over, their intellectual property
12. 12Our PRC subsidiaries have limited insurance coverage for their operations in China and may incur losses resulting from product liability claims, business interruption or natural disasters
13. 13Failure to make adequate contributions to various employee benefit plans as required by PRC regulations may subject us to penalties
14. 14If labor costs in the PRC increase substantially, our PRC subsidiaries’ business and our costs of operations may be adversely affected
15. 15We may not be able to effectively protect our intellectual property from unauthorized use by others
16. 16Competition for our and our subsidiaries’ employees is intense, and we and our subsidiaries may not be able to attract and retain the highly skilled employees needed to support our subsidiaries’ business
17. 17Our business depends on the continued efforts of our senior management. If one or more of our key executives were unable or unwilling to continue in their present positions, our business may be severely disrupted
18. 18We do not maintain “key person” insurance, and as a result, we may incur losses if any of our directors, executive officers, senior manager or other key employees chooses to terminate his or her services with us
19. 19We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing invasion of Ukraine by Russia and conflicts between Israel and Hamas
20. 20High inflation rates may adversely affect us by increasing costs beyond what we can recover through price increases and limit our ability to enter into future traditional debt financing

Risks Related to Doing Business in China

1. 21Changes in China’s economic, political or social conditions or government policies could have a material adverse effect on our business and operations
2. 22The PRC government also exercises significant control over China’s economic growth through allocating resources, controlling payment of foreign currency-denominated obligations, setting monetary policy, and providing preferential treatment to particular industries or companies
3. 23Uncertainties with respect to the PRC legal system could adversely affect us and our PRC subsidiaries
4. 24Our PRC subsidiaries may be liable for improper use or appropriation of personal information provided by their customers and any failure to comply with PRC laws and regulations over data security could result in materially adverse impact on our business, results of operations, and our continued listing on Nasdaq
5. 25A severe or prolonged downturn in the PRC or global economy could materially and adversely affect our business and our financial condition
6. 26You may have difficulty enforcing judgments against us
7. 27Under the PRC Enterprise Income Tax Law, we may be classified as a “Resident Enterprise” of China. Any classification as such will likely result in unfavorable tax consequences to us and our non-PRC shareholders
8. 28PRC regulation of loans to, and direct investments in, PRC entities by offshore holding companies may delay or prevent us from using proceeds from our future financing activities to make loans or additional capital contributions to our PRC subsidiaries
9. 29We may rely on dividends paid by our subsidiaries for our cash needs, and any limitation on the ability of our subsidiaries to make payments to us could have a material adverse effect on our ability to conduct business
10. 30You may be subject to PRC income tax on dividends from us or on any gain realized on the transfer of our ordinary shares
11. 31We may be unable to complete a business combination transaction efficiently or on favorable terms due to complicated merger and acquisition regulations and certain other PRC regulations
12. 32Fluctuations in exchange rates could have a material adverse impact on our results of operations and the value of your investment
13. 33Governmental control of currency conversion may limit our ability to utilize our revenues effectively and affect the value of your investment
14. 34U.S. regulatory bodies may be limited in their ability to conduct investigations or inspections of our operations in China

Risks Related to Our Ordinary Shares

1. 35Future sales of our ordinary shares, whether by us or our shareholders, could cause the price of our ordinary shares to decline
2. 36We do not know whether a market for the ordinary shares will be sustained or what the trading price of the ordinary shares will be and as a result it may be difficult for you to sell your ordinary shares
3. 37Securities analysts may not cover our ordinary shares and this may have a negative impact on the market price of our ordinary shares
4. 38Because we do not expect to pay dividends in the foreseeable future, you must rely on the price appreciation of our ordinary shares for a return on your investment
5. 39Techniques employed by short sellers may drive down the market price of our ordinary shares