Jin Medical International Ltd.

Company Overview

Business Model: Jin Medical International Ltd. operates as a holding company, with its core business conducted in China through its Variable Interest Entity (VIE), Changzhou Zhongjin Medical Co., Ltd., and its subsidiaries. The company designs and manufactures wheelchairs and living aids products for individuals with disabilities, the elderly, and those recovering from injuries. Its business primarily focuses on wheelchairs, which represented approximately 87.5% of total revenue in fiscal year 2025. The company produces both Original Equipment Manufacturer (OEM) products, manufactured to customer specifications and sold under their brands (79% of product sales in 2025), and its own branded products (21% in 2025). Products are distributed through a network of qualified dealers in Japan, China, and other international markets.

Market Position: The company holds a strong position in the Japanese manual wheelchair market, attributed to its industrial reputation, efficient marketing, and effective quality control. The wheelchair and living aids markets in Japan and China are characterized by an increasing aging population, rising disposable income in China, and continuous government support, which are favorable macroeconomic growth drivers. The company emphasizes delivering quality, lightweight, and ergonomic products with customizable attributes, including pioneering a "rehabilitation wheelchair" design concept in China.

Recent Strategic Developments:

• Product Diversification: Since 2018, Jin Medical International Ltd. has been expanding its product portfolio beyond manual wheelchairs to include electric wheelchairs and other living aids products such as oxygen concentrators and bathing machines. In fiscal year 2024, new product categories including oxygen chambers, beauty instruments, and nano products were introduced, contributing 6.8%, 8.9%, and 3.2% of revenue, respectively.
• Organizational Expansion:
  • In August 2023, Zhongjin Kangma Information Technology (Jiangsu) Co., Ltd. was incorporated, with Changzhou Zhongjin Medical Co., Ltd. holding an 80% equity interest.
  • In February 2025, Zhongjin Kangma Health Technology (Shanghai) Co., Ltd., a wholly-owned subsidiary of Zhongjin Kangma Information Technology (Jiangsu) Co., Ltd., was incorporated.
  • In December 2025, Zhongjin Medical Equipment (Guangxi) Co., Ltd., a wholly-owned subsidiary of Zhongjin International Limited, was incorporated.
• Manufacturing Capacity Expansion: On October 18, 2024, the company initiated the construction of a new manufacturing facility in Chuzhou City, Anhui Province, with an investment budget of approximately $10.3 million (RMB 73.3 million). This facility is intended to expand production capacity for premium mobility products, particularly mid-to-high-end electric wheelchairs and senior mobility scooters. As of September 30, 2025, approximately $6.1 million (RMB 43.1 million) had been spent, with completion postponed to April 2026 due to internal renovation optimizations.
• Corporate Structure Reclassification: On January 30, 2026, shareholders approved a Dual Class Reclassification, redesignating all authorized Ordinary Shares into Class A and Class B Ordinary Shares, subject to Nasdaq approval. This involves issuing 136,547,100 Class A Ordinary Shares and approximately 20,000,000 Class B Ordinary Shares to Jolly Harmony Enterprises Limited, an entity controlled by the CEO, and repurchasing and canceling existing Ordinary Shares.

Geographic Footprint: The company's operations and assets are substantially located in China. Its primary markets for product sales are Japan and China. It also sells products to dealers in other regions including the United States, Canada, Australia, Korea, Israel, Singapore, Hungary, and Brazil. Manufacturing facilities are located in Changzhou City and Taizhou City in Jiangsu Province, and Chuzhou City in Anhui Province, China.

Cross-Border Operations: Jin Medical International Ltd. operates through a holding company structure involving a Cayman Islands parent, a Hong Kong subsidiary (Zhongjin International Limited), and PRC Wholly Foreign-Owned Enterprises (WFOEs) and a Variable Interest Entity (VIE) in China. The VIE structure, governed by contractual arrangements, allows the company to control and receive economic benefits from its China-based operations. The company is subject to various PRC and Japanese laws and regulations, including those related to foreign investment, medical devices, product liability, and foreign exchange controls. Funds transfers between the Cayman Islands holding company, Hong Kong subsidiary, and PRC operating entities are subject to PRC governmental controls and restrictions.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Gross Margin (2025): 29.2%
• Operating Margin (2025): 2.9%
• Net Margin (2025): 5.8%

Investment in Growth:

• R&D Expenditure: $1,557,703 (7.5% of revenue) in 2025, compared to $1,497,325 (6.4% of revenue) in 2024.
• Capital Expenditures: $6,629,800 in 2025, primarily for property, plant, and equipment, including the new manufacturing facility.
• Strategic Investments: Prepayment for business acquisition of $500,000 in 2025. Investment in a new manufacturing facility in Chuzhou City, Anhui Province, with an estimated budget of $10.3 million (RMB 73.3 million), of which approximately $6.1 million (RMB 43.1 million) had been spent by September 30, 2025.

Currency Impact Analysis:

• Fiscal Year 2025: The appreciation of the Japanese Yen against the Renminbi improved the profitability of Nissin Medical Industries Co., Ltd., leading to increased sales orders and a $1.2 million increase in total sales to Nissin Medical Industries Co., Ltd. and its subsidiaries. The company also recorded a foreign exchange transaction gain of $23,071, primarily due to fluctuations in foreign exchange rates on cash, accounts receivables, and accounts payables denominated in foreign currencies.
• Fiscal Year 2024: The weakening of the Japanese Yen negatively impacted Nissin Medical Industries Co., Ltd.'s profitability, increasing their cost of wheelchair products and resulting in a $1.6 million decrease in sales orders from Nissin Medical Industries Co., Ltd. and its subsidiaries. The company recorded a foreign exchange transaction loss of $26,774.
• Fiscal Year 2023: Revenue growth was partially offset by a 7.1% depreciation of the Renminbi against the U.S. dollar.
• Hedging Strategies: Jin Medical International Ltd. has not entered into any hedging transactions to reduce its exposure to foreign currency exchange risk.
• Functional Currency: The functional currency for Jin Medical International Ltd. is the U.S. Dollar, for Zhongjin International Limited (Hong Kong) is the Hong Kong Dollar, and for its PRC subsidiaries, the VIE, and the VIE's subsidiaries is the Chinese Yuan (RMB).

Product Category Analysis

Wheelchairs

Financial Performance:

• Revenue: $16,222,561 (+9.1% YoY) in 2025, $14,866,699 (-9.1% YoY) in 2024, $16,348,133 in 2023.
• Gross Margin: 27.8% in 2025, 32.9% in 2024, 32.3% in 2023.
• Key Growth Drivers: In 2025, increased sales to Nissin Medical Industries Co., Ltd. in Japan, driven by the appreciation of the Japanese Yen against the Renminbi, which improved Nissin Medical Industries Co., Ltd.'s profitability. Also, increased revenue from new customers. In 2024, sales decreased due to the weakening Japanese Yen impacting Nissin Medical Industries Co., Ltd.'s purchasing power.

Product Portfolio:

• Major product lines include manual wheelchairs (the vast majority of sales) and electric wheelchairs (1.7% of revenue in 2025).
• The company offers over thirty models of manual wheelchairs, with mid-to-high-end products for Japan and lower-end products for China.
• New product launches include specialized wheelchairs like the MRI wheelchair and airport wheelchair, and advanced models such as the carbon fiber NAH-207 (weighing 4.5 kg with 100 kg capacity) and various aluminum alloy and titanium alloy models (e.g., UNIX-22DS, NA-437).

Market Dynamics:

• The market benefits from an increasing aged population, rising disposable income, and government support in Japan and China.
• The company focuses on delivering lightweight, ergonomic, and customizable designs, including its "rehabilitation wheelchair" concept.

Geographic Revenue Distribution:

• Japan: $12,126,958 (58.6% of total revenue) in 2025, $11,196,118 (47.6% of total revenue) in 2024, $13,837,712 (69.8% of total revenue) in 2023.
• Mainland China: $4,414,699 (21.3% of total revenue) in 2025, $8,610,981 (36.6% of total revenue) in 2024, $2,739,459 (13.8% of total revenue) in 2023.

Wheelchair Components

Financial Performance:

• Revenue: $1,886,766 (+0.2% YoY) in 2025, $1,883,761 (-32.0% YoY) in 2024, $2,770,392 in 2023.
• Gross Margin: 45.8% in 2025, 47.7% in 2024, 49.7% in 2023.
• Key Growth Drivers: Revenue remained relatively stable in 2025 due to more sales orders for repair and maintenance purposes. The decrease in 2024 was attributed to fewer sales orders.

Product Portfolio:

• Primarily "easy-to-wear" parts such as tires, brake pads, and foot pedals.

Other Products (Living Aids, Oxygen Chamber, Beauty Instruments, Nano Products)

Financial Performance:

• Revenue: $2,577,947 (-61.8% YoY) in 2025, $6,751,550 (+860.5% YoY) in 2024, $702,932 in 2023.
• Gross Margin: 26.1% in 2025, 55.0% in 2024, 17.5% in 2023.
• Key Growth Drivers: In 2025, a significant decrease in revenue (approximately $4.2 million) from nano products, micro hyperbaric oxygen chamber products, and facial beauty instruments, as market awareness for these newly launched products remained underdeveloped. This was partially offset by increased revenue from electric scooters (approximately $0.2 million). In 2024, substantial growth was driven by the newly launched nano products, micro hyperbaric oxygen chamber products, and facial beauty instruments, as well as expanded production lines for electric scooters.

Product Portfolio:

• Includes oxygen concentrators, bathing machines (e.g., 1 Liter Capacity Portable Oxygen Inhaler, Electric Lifting Bathing Machine), micro hyperbaric oxygen chambers (Model S, M), beauty instruments (e.g., Superconductor carving instrument, Super wave brightening instrument, Super body health equipment), and nano products (e.g., Nano shampoo instrument, Nano thermal therapy chamber).

International Operations & Geographic Analysis

Revenue by Geography:

| Region/Country | Revenue (2025) | % of Total (2025) | Growth Rate (2025 vs 2024) | Key Drivers | |---|---|---|---| | Japan | $12,126,958 | 58.6% | +8.3% | Yen appreciation against RMB improved Nissin Medical Industries Co., Ltd.'s profitability, leading to increased orders. | | Mainland China | $4,414,699 | 21.3% | -48.7% | Decreased sales of newly launched nano products, micro hyperbaric oxygen chamber products, and facial beauty instruments. | | U.S. | $1,658,331 | 8.0% | +1.9% | General sales. | | Hong Kong | $440,830 | 2.1% | -19.5% | General sales. | | Singapore | $199,362 | 1.0% | +9.3% | General sales. | | Korea | $1,340,712 | 6.5% | +57.3% | General sales. | | Australia | $201,777 | 1.0% | -7.1% | General sales. | | Others | $304,605 | 1.5% | +13.1% | Expansion into Europe (Hungary) and South America (Brazil) in 2025. |

International Business Structure:

• Subsidiaries:
  • Jin Medical International Ltd. (Cayman Islands - holding company)
  • Zhongjin International Limited (Hong Kong - wholly-owned subsidiary, holding company)
  • Erhua Medical Technology (Changzhou) Co., Ltd. (PRC - wholly-owned WFOE, primary beneficiary of VIE)
  • Zhongjin Medical Equipment (Anhui) Co., Ltd. (PRC - wholly-owned WFOE, incorporated Oct 2023, not yet operational)
  • Zhongjin Medical Equipment (Guangxi) Co., Ltd. (PRC - wholly-owned WFOE, incorporated Dec 2025, not yet operational)
• Variable Interest Entity (VIE): Changzhou Zhongjin Medical Co., Ltd. (PRC - controlled via contractual arrangements).
  • VIE Subsidiaries: Taizhou Zhongjin Medical Co., Ltd. (100% owned), Changzhou Zhongjin Jing’ao Trading Co., Ltd. (100% owned), Zhongjin Kangma Information Technology (Jiangsu) Co., Ltd. (80% owned), Zhongjin Kangma Health Technology (Shanghai) Co., Ltd. (100% owned by Zhongjin Kangma, not yet operational).

Cross-Border Trade:

• Export Markets: Primary export markets are Japan and China, with additional sales to the U.S., Canada, Australia, Korea, Israel, Singapore, Hungary, and Brazil.
• Import Dependencies: The company's manufacturing relies on materials and components such as aluminum, steel, plastics, titanium alloys, and electronic components. No single supplier accounted for more than 10% of total purchases in the last three fiscal years.
• Transfer Pricing: The company's contractual arrangements with its VIE are subject to scrutiny by PRC tax authorities regarding arm's length principles, which could lead to transfer pricing adjustments and increased tax liabilities.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: As part of the Dual Class Reclassification approved on January 30, 2026, 156,547,100 currently issued and outstanding Ordinary Shares will be repurchased and cancelled. This is a structural change rather than a recurring capital return program.
• Dividend Payments: The company does not intend to pay dividends for the foreseeable future, planning to retain future earnings to finance business operations and expansion.
• Future Capital Return Commitments: No specific future capital return commitments are disclosed.

Balance Sheet Position:

• Cash and Equivalents: $7,461,630 as of September 30, 2025, down from $8,136,179 in 2024.
• Total Debt: $18,837,468 in short-term bank loans as of September 30, 2025, up from $11,322,440 in 2024.
• Net Cash Position: $(11,375,838) as of September 30, 2025, compared to $(3,186,261) in 2024, indicating a net debt position.
• Debt Maturity Profile: All outstanding bank loans are short-term, with maturities within one year. The company expects to renew existing bank loans based on past experience and good credit history.

Cash Flow Generation:

• Operating Cash Flow: $2,903,584 in 2025, compared to $(1,207,305) in 2024 and $3,106,403 in 2023.
• Free Cash Flow: Not explicitly stated, but operating cash flow has fluctuated, with a positive trend in 2025 after a negative 2024.
• Cash Conversion Metrics: Not explicitly provided.

Currency Management:

• The company's cash holdings are primarily in Renminbi in mainland China ($7,433,398 in 2025), with smaller amounts in U.S. Dollars outside the PRC ($6,914 in 2025) and Hong Kong Dollars in Hong Kong ($1,098 in 2025).
• The company does not currently employ financial hedging instruments or strategies to manage currency risk.

Operational Excellence

Production & Service Model: Jin Medical International Ltd. employs a vertically integrated business model, conducting product design, engineering, manufacturing, and assembly in-house. This approach allows for rapid implementation of design changes, quality control, timely product delivery, and direct raw material procurement. While most work is in-house, generic processes like surface treatment, welding, and sewing may be outsourced to third-party contractors depending on product type and facility availability. For living aids products, some are procured from third-party suppliers, while others are produced at the Taizhou City facility.

Global Supply Chain Architecture:

• Key Suppliers & Partners: The company sources raw materials such as steel, aluminum, titanium, various alloys, plastics, electronic components, sponges, leather, and PU foam. Key components include wheels, brakes, and foot pedals. No single supplier accounted for more than 10% of total purchases in the last three fiscal years, indicating a diversified supplier base. Quality control is integrated into procurement, with raw materials and components undergoing certification, re-examination, and unannounced inspections.
• Facility Network:
  • Manufacturing: The company operates three manufacturing plants totaling approximately 658,257 square feet in Changzhou City and Taizhou City (Jiangsu Province), and Chuzhou City (Anhui Province), China. The Changzhou and Chuzhou plants are owned, while the Taizhou plant is leased until 2043.
  • Research & Development: The R&D department, led by the CEO, has 40 employees and is responsible for continuous innovation in wheelchair and living aids product designs.
  • Distribution: Products are delivered to domestic distributors in China via freight shipping and to foreign countries via international ocean cargo and air express delivery.

Operational Metrics:

• Capacity Utilization: The average utilization rate of production lines was 76% in 2025, 70% in 2024, and 75% in 2023.
• Quality Indicators: The company maintains strict quality control procedures and has obtained ISO and JIS certifications. Warranty costs for fiscal years 2025, 2024, and 2023 were nil, reflecting the quality of its manual wheelchairs.

Market Access & Customer Relationships

Go-to-Market Strategy:

• Distribution Channels: The company primarily distributes its products through a well-established network of qualified dealers. This network includes one large distributor in Japan, over forty dealers in China, and more than twenty dealers in other international regions.
• Digital Platforms: The company plans to build its own online platform for direct sales and marketing to end-users globally. It holds a Value Added Telecommunications Service license for internet content provision, renewed until April 2026, and intends to open online stores on major e-commerce sites like JD.com, tmall.com, and taobao.com, in addition to developing its own website.

Customer Portfolio:

• Enterprise Customers: Nissin Medical Industries Co., Ltd. is the company's largest dealer and sole distributor in Japan, a relationship maintained since 2006.
• Strategic Partnerships: The long-standing relationship with Nissin Medical Industries Co., Ltd. is based on mutual trust and an annually renewed sales framework contract.
• Customer Concentration: Sales to Nissin Medical Industries Co., Ltd. and its wholly-owned subsidiaries (Colours’n Motion Inc, Nissin Co., Ltd., and Nissin Medical Vietnam Co., Ltd.) represented a significant portion of total revenue: 71.0% in 2025, 57.3% in 2024, and 78.2% in 2023. This concentration poses a material risk to the company's operations if this relationship deteriorates or terminates.

Regional Market Penetration:

• The company has expanded its business footprint into Europe (Hungary) and South America (Brazil) in fiscal year 2025.
• It aims to further expand into underserved niche markets, such as western China, and foreign markets with growth potential, including the U.S. and Europe, particularly for its new electronic wheelchairs.

Competitive Intelligence

Global Market Structure & Dynamics

Industry Characteristics: The wheelchair and living aids markets in Japan and China are described as complex and attractive, driven by an increasing aged population, rising disposable income, and continuous government support. These markets feature a coexistence of major medical facility companies and smaller, less sophisticated companies.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors:

• Sangui Wheelchair Rehabilitation Equipment (Shanghai) Co., Ltd.: Competes in manual wheelchairs and living aids.
• Shanghai Jiekaiyang Medical Equipment Co., Ltd.: Competes in manual and electric wheelchairs.
• Matsunaga Welfare Appliance Manufacturing (Shanghai) Co., Ltd.: Competes in manual wheelchairs.
• Jiangsu Yuyue Medical Equipment Co., Ltd.: Competes in manual wheelchairs and living aids.

Regional Competitive Dynamics: The company acknowledges that some competitors possess substantial advantages, including longer operating histories, broader product portfolios, more established supplier and channel partner relationships, larger user bases, greater brand recognition, and superior financial, R&D, marketing, and distribution resources. The company's ability to compete relies on product quality, engineering ingenuity, and customer goodwill.

Risk Assessment Framework

Strategic & Market Risks

• Global Market Dynamics: The company is exposed to risks from severe or prolonged downturns in the global or Chinese economy, which could materially and adversely affect its business. Intensified competition may lead to pricing pressures, reduced profitability, and loss of market share. Adverse macroeconomic conditions in Japan, its primary market, could harm business results.
• Technology Disruption: The rapidly evolving wheelchair and living aids markets, characterized by frequent new product introductions and short design cycles, pose risks of technology disruption. Competitors' innovations could render the company's products uneconomical or obsolete.
• Customer Concentration: A significant portion of revenue (71.0% in 2025, 57.3% in 2024, 78.2% in 2023) is concentrated with one large customer, Nissin Medical Industries Co., Ltd., and its subsidiaries. The absence of a long-term agreement with this key customer and reliance on a longstanding relationship presents a material risk if purchases are reduced or terminated.

Operational & Execution Risks

• Global Supply Chain Vulnerabilities: The business depends on a consistent supply of manufacturing materials and components. Disruptions, quality changes, or recalls from suppliers could lead to substantive costs or business interruptions. While no single supplier accounts for more than 10% of purchases, volatility in raw material prices (e.g., aluminum, steel) and currency fluctuations can impact earnings.
• Regional Disruptions: Public health crises, such as the COVID-19 pandemic, can impair material procurement and increase costs, leading to operational disruptions. The future impact of COVID-19 remains uncertain.
• Trade Restrictions: Changes in currency values and tariff policies in foreign countries could impact the competitiveness of products in major markets like Japan.

Financial & Regulatory Risks

• Currency & Financial Risks: Fluctuations in Renminbi exchange rates against the U.S. dollar and other foreign currencies can adversely affect the business and the value of securities. Government controls on currency conversion in China may restrict the ability to remit dividends. The company has limited sources of working capital and may require substantial additional financing, which could dilute existing shareholders.
• Regulatory & Compliance Risks:
  • VIE Structure: The contractual arrangements governing the VIE structure have not been tested in a court of law and are subject to uncertainties in interpretation and application of PRC laws. The PRC government could disallow the VIE structure, leading to severe penalties, material changes in operations, and a significant decline in share value.
  • Medical Device Classification: Wheelchairs and living aids products are classified as Class II medical devices in the PRC, subject to safety and technical inspections. Failure to meet requirements can result in monetary penalties, production delays, and loss of sales.
  • Data Security: Recent greater oversight by the Cyberspace Administration of China (CAC) over data security, particularly for companies seeking foreign listings, could impact the business, although the company believes it is not currently subject to cybersecurity review requirements.
  • Overseas Listing Regulations: New PRC regulations (Opinions, Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies, and revised Provisions on Strengthening Confidentiality and Archives Administration of Overseas Securities Offering and Listing by Domestic Companies) may impose additional compliance requirements for overseas listings, potentially limiting or hindering the ability to offer securities.
• Tax Regulations: The company may be classified as a "Resident Enterprise" of China under the Enterprise Income Tax Law, which could result in unfavorable tax consequences, including a 25% tax rate on worldwide income and potential withholding tax on dividends or gains for non-PRC shareholders. Contractual arrangements with the VIE may be scrutinized by PRC tax authorities for transfer pricing, potentially leading to additional taxes.

Geopolitical & External Risks

• Country-Specific Risks: Changes in China's economic, political, or social conditions or government policies could materially and adversely affect operations. The Chinese government exerts substantial influence over business conduct and may intervene at any time. Adverse macroeconomic conditions in Japan, the primary market, could harm business results.
• Regulatory Changes: Uncertainties in the evolving PRC legal system, including rapid changes in laws and regulations, vague interpretations, and potential retroactive application, could adversely affect the business and impede operations.

Innovation & Technology Leadership

Research & Development Focus:

• Global R&D Network: The company maintains a strong R&D department with 40 employees, many holding advanced degrees in engineering. Dr. Erqi Wang, the CEO, leads the R&D efforts and is credited with pioneering the "rehabilitation wheelchair" design concept in China.
• Innovation Pipeline: The R&D department continuously delivers innovative, lightweight, and ergonomic wheelchair designs. Recent developments include the MRI wheelchair, airport wheelchair, and the carbon fiber NAH-207 model (4.5 kg, 100 kg capacity). The company has consistently introduced new wheelchair models (13 in 2025, 13 in 2024, 14 in 2023) and developed new living aids products like oxygen concentrators and bath machines since 2019.

Intellectual Property Portfolio:

• Patent Strategy: The company owns approximately 117 patents and has filed 3 additional patent applications with the Patent Administration Department of the PRC.
• Trademark Strategy: It owns 21 registered trademarks in China for various trade names, brands, and products.
• IP Protection: Intellectual property is registered with the Chinese intellectual property agency and not outside of China. The company relies on a combination of patent, trademark, and trade secret laws, as well as confidentiality agreements, to protect its proprietary rights.

Technology Partnerships: The company plans to establish and strengthen strategic cooperation and partnerships with industry leaders, design firms, and research institutions to stay at the forefront of innovation.

Leadership & Governance

Executive Leadership Team

International Management Structure: The filing does not provide specific details on the international management structure beyond the executive leadership team.

Board Composition: The board of directors consists of five directors, including three independent directors: Yanru Guo, Oliver St. Clair Franklin, and Jiayuan (James) Tong. Yanru Guo is designated as an audit committee financial expert. The CEO, Erqi Wang, beneficially owns more than 50% of the outstanding Ordinary Shares, giving him significant influence over shareholder-approved matters. The company has established an audit committee, a compensation committee, and a nominating and corporate governance committee, with independent directors forming the majority of each committee.

Regulatory Environment & Compliance

Multi-Jurisdictional Regulatory Framework:

• Primary Regulatory Environments:
  • China: The company's PRC operations are subject to extensive regulation by authorities such as the National Medical Products Administration (NMPA) for medical devices (Class II for wheelchairs and living aids), the Ministry of Ecology and Environment for environmental protection, and the Ministry of Commerce (MOFCOM) for foreign trade and investment. Key laws include the Regulation on the Supervision and Administration of Medical Devices, Product Quality Law, Foreign Trade Law, Environmental Protection Law, Foreign Investment Law, and the Enterprise Income Tax Law. The company holds Class II medical device manufacturing licenses and pollutant discharging licenses.
  • Japan: As a major market, Japan imposes regulations including the Product Liability Act (strict liability for product defects), Electrical Appliances and Materials Safety Act (PSE mark for electric wheelchairs), Consumer Product Safety Act (reporting serious product accidents), Road Traffic Act (electric wheelchairs meeting specific criteria are considered pedestrians), and Industrial Standardization Act (JIS standards for wheelchairs). The Long-Term Care Insurance Act influences demand for assistive products.
• Cross-Border Compliance:
  • Export Controls: Foreign trade operators in China must register with MOFCOM or its authorized institutions for import and export activities.
  • Anti-Corruption: The company is exposed to liabilities under the U.S. Foreign Corrupt Practices Act (FCPA) and Chinese anti-corruption laws, which prohibit improper payments.
• International Tax Strategy:
  • Transfer Pricing: Related party transactions between the WFOE, VIE, and VIE shareholders are subject to audit and potential adjustments by PRC tax authorities if not conducted on an arm's length basis.
  • Tax Treaties: Dividends paid by PRC subsidiaries to the Hong Kong subsidiary (Zhongjin International Limited) may be subject to a reduced 5% withholding tax rate under the Double Tax Avoidance Arrangement between mainland China and Hong Kong, provided certain conditions are met, including obtaining a tax resident certificate from Hong Kong.

Environmental & Social Impact

Global Sustainability Strategy: The filing does not explicitly detail a global sustainability strategy, carbon neutrality commitments, or renewable energy adoption across operations.

Regional Sustainability Initiatives:

• China: Changzhou Zhongjin Medical Co., Ltd. and its subsidiaries have obtained approvals for environmental impact reports and statements. They have completed pollutant discharge registration and hold a Pollutant Discharging License valid until April 2030.
• Supply Chain: No specific global supplier ESG requirements or sustainability standards are disclosed.

Social Impact by Region:

• Community Investment: The company made a donation of approximately $139,000 to the Shanghai Senior Citizens Foundation in fiscal year 2024.
• Labor Standards: In China, the company's subsidiaries and VIE participate in government-mandated social security plans (pension, medical, unemployment, maternity, occupational injury insurance, and housing fund) for eligible full-time employees. They have received confirmations from local Social Security Bureaus in Jiangsu Province regarding compliance with employment and social benefit regulations from January 2017 to August 2021.

Currency Management & Financial Strategy

Multi-Currency Operations:

• Currency Exposure: The company's revenues, expenses, assets, and liabilities are primarily denominated in Renminbi. It also has exposure to the Japanese Yen and U.S. Dollar. Fluctuations in the Renminbi's value against other currencies, influenced by China's political and economic conditions and foreign exchange policies, can significantly impact financial results.
• Cash Holdings by Major Currencies (as of September 30, 2025):
  • U.S. Dollars (outside PRC): $6,914
  • Renminbi (mainland China): $7,433,398
  • Hong Kong Dollars (Hong Kong): $1,098

Hedging Strategies:

• Transaction Hedging: The company has not entered into any hedging transactions to reduce its exposure to foreign currency exchange risk.
• Translation Hedging: Not explicitly mentioned.
• Economic Hedging: Not explicitly mentioned.