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1、The Stock Exchange of Hong Kong Limited and the Securities and Futures Commission take no responsibilityfor the contents of this Application Proof,make no representation as to its accuracy or completeness andexpressly disclaim any liability whatsoever for any loss howsoever arising from or in relian
2、ce upon the wholeor any part of the contents of this Application Proof.Application Proof ofiMotion Automotive Technology(Suzhou)Co.,Ltd.知行汽車科技(蘇州)股份有限公司(the“Company”)(A joint stock company incorporated in the Peoples Republic of China with limited liability)WARNINGThe publication of this Application
3、 Proof is required by The Stock Exchange of Hong Kong Limited(the“Stock Exchange”)and the Securities and Futures Commission(the“Commission”)solely for the purpose ofproviding information to the public in Hong Kong.This Application Proof is in draft form.The information contained in it is incomplete
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8、ent does not constitute a prospectus,offering circular,notice,circular,brochure oradvertisement offering to sell any securities to the public in any jurisdiction,nor is it an invitation to thepublic to make offers to subscribe for or purchase any securities,nor is it calculated to invite offers byth
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13、ong Kong until after a prospectus of the Company hasbeen registered with the Registrar of Companies in Hong Kong in accordance with the Companies(WindingUp and Miscellaneous Provisions)Ordinance(Chapter 32 of the Laws of Hong Kong).If an offer or aninvitation is made to the public in Hong Kong in du
14、e course,prospective investors are reminded to make theirinvestment decisions solely based on the Companys prospectus registered with the Registrar of Companies inHong Kong,copies of which will be made available to the public during the offer period.IMPORTANT:If you have doubt about any of the conte
15、nts in this document,you should obtain independent professional advice.iMotion Automotive Technology(Suzhou)Co.,Ltd.知行汽車科技(蘇州)股份有限公司(A joint stock company incorporated in the Peoples Republic of China with limited liability)REDACTEDNumber of REDACTED under theREDACTED:REDACTED H Shares(subject to th
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17、 0.00565%(payable in full on application in HongKong dollars,subject to refund)Nominal Value:RMB1.00 per ShareREDACTED:REDACTEDJoint Sponsors,REDACTED(in no particular order)REDACTEDHong Kong Exchanges and Clearing Limited,The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Com
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24、EDACTED below that statedin this document(being HK$REDACTED per H Share)at any time on or prior to the morning of the last date for lodging applications under the REDACTED.In such a case,notices of thereduction in the number of REDACTED and/or the REDACTED will be published on the websites of the St
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35、 DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.REDACTEDEXPECTED TIMETABLE(1)v THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE
36、 READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.IMPORTANT NOTICE TO REDACTEDThis document is issued by us solely in connection with the REDACTED and doesnot constitute an REDACTED to sell or a solicitation of an offer to buy any securityother than the REDACTED offe
37、red by this document pursuant to the REDACTED.This document may not be used for the purpose of,and does not constitute,anREDACTED or a solicitation of an REDACTED to REDACTED for or buy,anysecurity in any other jurisdiction or in any other circumstances.No action has been takento permit a REDACTED o
38、f the REDACTED or the distribution of this document inany jurisdiction other than Hong Kong.The distribution of this document and theREDACTED and sale of the REDACTED in other jurisdictions are subject torestrictions and may not be made except as permitted under the applicable securities lawsof such
39、 jurisdictions pursuant to registration with or authorization by the relevantsecurities regulatory authorities or an exemption therefrom.You should rely only on the information contained in this document and theREDACTED to make your REDACTED decision.We have not authorized anyone toprovide you with
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41、ive directors,officers or representatives,or any other person or partyinvolved in the REDACTED.EXPECTED TIMETABLE.iiiCONTENTS.viSUMMARY.1DEFINITIONS.30GLOSSARY OF TECHNICAL TERMS.47FORWARD-LOOKING STATEMENT.54RISK FACTORS.56WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES.113INFORMATION ABOUT T
42、HIS DOCUMENT AND THE REDACTED.118DIRECTORS,SUPERVISORS AND PARTIES INVOLVED IN THEREDACTED.124CONTENTS vi THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.CORPORATE INFORM
43、ATION.131INDUSTRY OVERVIEW.133REGULATORY OVERVIEW.151HISTORY AND CORPORATE STRUCTURE.173BUSINESS.209RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS.330DIRECTORS,SUPERVISORS AND SENIOR MANAGEMENT.335SUBSTANTIAL SHAREHOLDERS.353SHARE CAPITAL.355FINANCIAL INFORMATION.364FUTURE PLANS AND REDACTED.431REDA
44、CTED.437STRUCTURE OF THE REDACTED.450HOW TO APPLY FOR REDACTED.460APPENDIX I ACCOUNTANTS REPORT.I-1APPENDIX II REDACTED FINANCIAL INFORMATION.II-1APPENDIX III TAXATION AND FOREIGN EXCHANGE.III-1APPENDIX IV SUMMARY OF PRINCIPAL LEGALAND REGULATORY PROVISIONS.IV-1APPENDIX V SUMMARY OF ARTICLES OF ASSO
45、CIATION.V-1APPENDIX VI STATUTORY AND GENERAL INFORMATION.VI-1APPENDIX VII DOCUMENTS DELIVERED TO THE REGISTRAR OFCOMPANIES AND AVAILABLE ON DISPLAY.VII-1CONTENTS vii THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION H
46、EADED“WARNING”ON THE COVER OF THIS DOCUMENT.This summary aims to give you an overview of the information contained in thisdocument.As it is a summary,it does not contain all the information that may beimportant to you and is qualified in its entirety by,and should be read in conjunctionwith,the full
47、 document.You should read the whole document before you decide toREDACTEDintheREDACTED.TherearerisksassociatedwithanyREDACTED.Some of the particular risks in REDACTED in the REDACTED areset forth in the section headed“Risk Factors”of this document.You should read thatsection carefully before you dec
48、ide to REDACTED in the REDACTED.OVERVIEWWe are an autonomous driving solution provider in China with a focus on AD domaincontrollers.We have commercialized level 2 to level 2+,and are developing level 2 to level 4,autonomous driving solutions for automotive manufacturers(OEMs).We series-produced our
49、first autonomous driving solution,our iFC series,in 2020.Our revenue increased significantlyfrom RMB47.7 million in 2020 to RMB178.3 million in 2021 and further to RMB1,325.9million in 2022,with a CAGR of 427.2%,and from RMB359.2 million for the six monthsended June 30,2022 to RMB543.2 million for t
50、he six months ended June 30,2023.At therelatively early stages of large-scale commercialization,we have been loss-making since 2020and we expect to incur net loss and net operating cash outflow in 2023.For details,see“Business Business Sustainability.”As an automotive system integrator(Tier 1 suppli
51、er),we offer various autonomous driving in-vehicle solutions and products to OEMs on both newenergy vehicles(NEVs)and internal combustion engine(ICE)vehicles.Our autonomousdriving domain controller(AD domain controller)solutions typically include(i)an AD domaincontroller;(ii)associated sensors,which
52、 we procure from third-party suppliers and integrateinto our solutions;(iii)integrated software,algorithms and functions;and(iv)relevant servicessuch as sensor implementation,vehicle systems integration,and function testing andvalidation.On the hardware side,we have commercialized two AD domain cont
53、roller product lineswhich support level 2 to level 2+autonomous driving functions,covering a wide price rangeof passenger vehicles and all types of driving scenarios,including highways,ring roads,complex urban roads,country roads,and parking areas.We act as the system integrator inSuperVision projec
54、ts,which is based on Mobileyes technology including the base versionof AD domain controllers acquired from Mobileye.We also provide self-designed andself-developed iDC series which includes iDC Mid and iDC High.In terms of revenuegenerated from sales of AD domain controller solutions in 2022,we were
55、 the fourth largest ADdomain controller provider in China taking into account the in-house developed domaincontrollers by OEMs,with a market share of 8.6%.SAE is a U.S.-based global association of engineering professionals in various industrieswith a focus on transport industries,such as aerospace,a
56、utomotive and commercial vehicles.SAE classified vehicle automation into six levels(ranging from level 0 to level 5)based on theextent of human intervention and the scope of the driving scenario.Market participants classifyautonomous driving solutions into more specific categories based on the SAE c
57、lassification,SUMMARY 1 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.such as level 2+,as a standard practice in the industry to give users and customers a moreprecise
58、idea of the level of automation of their products.Although it is not an officialclassification under SAE standard,automotive industry has widely adopted the terminology oflevel 2+to distinguish their advanced technologies and functions from the basic level 2function.A typical basic level 2 function
59、is a combination of Adaptive Crusie Control(ACC)and Lane Centering Control(LCC),which helps vehicles dynamically maintain a safefollowing distance and keeps the vehicles centered in the lane at the same time.An exampleof an level 2+function is Automated Lane Change(ALC),which actively detects vehicl
60、es inthe blind spot and,when clear,performs a lane change movement at the drivers request.AD domain controllers function as the brain of autonomous driving solutions-fusing andprocessing data from the vehicles sensors to make autonomous driving decisions and triggeractuators in the vehicles.The diag
61、ram below illustrates the main components of an autonomousdriving solution.Chassis,PowertrainExecutionSteering SystemPowertrainBraking SystemEnvironmentVehicle MotionDriver StatusCameras,mm Wave Radar,LiDAR,Ultrasonic SensorsPerceptionLocalizationData FusionPlanning and ControlAD domain controllerDe
62、cisionWe also offer iFC products to OEMs based on our core algorithms on a stand-alone basiswithout providing relevant implementation and installation services.Our iFC product,whichincorporates a controller supported by a SoC and a camera,is able to independently realizelevel 2 autonomous driving fu
63、nctions.We possess comprehensive R&D capabilities for the development of iDC and iFCproducts,including self-developed algorithms and hardware-software co-design capabilities,and are able to capture the massive opportunities in the autonomous driving market with(i)ourcomprehensive capabilities in har
64、dware,software,algorithms,functions and cloud,(ii)ourcontinued algorithm optimization based on years of experience in commercializing level 2+solutions,and(iii)our stable relationship with OEM customers and strategic partners.According to Frost&Sullivan,under the trends of vehicle electrification,in
65、telligence andconnectivity,the autonomous driving market in China is expected to maintain significantgrowth momentum in the future.The size of the autonomous driving market,includingsoftware and hardware for passenger and commercial vehicles as well as robotaxi services,isexpected to reach more than
66、 RMB1,100 billion and RMB3,100 billion in China and globally,respectively,in 2035.Accordingly,the market for AD domain controllers which are describedas the brain of autonomous driving solutions,is expected to grow rapidly in the near future.SUMMARY 2 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SU
67、BJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.The market size for AD domain controllers in China was RMB9.8 billion in 2022,of whichRMB3.3 billion was attributed to third-party AD domain controller providers.The mark
68、et sizefor AD domain controllers in China is expected to reach RMB64.5 billion in 2026,at a CAGRof 60.1%from 2022 to 2026.It is anticipated that third-party AD domain controller providerswill occupy a larger market share in the future by offering more diverse and cost-effectivesolutions to OEMs.Duri
69、ng the Track Record Period,we generated most of our revenue from the sale of ourautonomous driving solutions and products to OEMs and we delivered approximately 130thousand units of AD domain controllers in total.Most of these were SuperVision suppliedto Geely Group,which were developed based on Mob
70、ileyes technology including the baseversion of AD domain controllers acquired from Mobileye.As of the Latest Practicable Date,we obtained letters of nomination associated with 15 renowned OEM customers,such as Geely,Great Wall Motor,Chery and Dongfeng,among others,who sourced or are expected to sour
71、ceAD domain controllers and iFC products from us.Obtaining a letter of nomination indicatesthat we are selected as a designated supplier for autonomous driving solutions and products fora particular vehicle model of an OEM customer,and are qualified to join an OEMs supplychains for such particular v
72、ehicle model.However,there is no guarantee that our OEMcustomers will purchase our solutions and products in large quantities or at all and at a pricethat will be profitable to us even having entered into a letter of nomination and no certaintyof finalization of contract and such letter of nominatio
73、n may be terminated.There is also noguarantee that we will be able to recover the significant upfront costs incurred during thedevelopment of autonomous driving solutions.As of the Latest Practicable Date,to ourknowledge,we were the sole suppliers for all projects in which we obtained letters ofnomi
74、nation for AD domain controllers,except in one case where another autonomous drivingsolutions provider was engaged for lower-end versions of the vehicle model.Since 2018,we have established a strategic partnership with Mobileye,and Mobileye hasbecome one of our key suppliers who primarily supplied t
75、he base version of AD domaincontrollers for SuperVisionTM.The AD domain controller solution we provided for ZEEKR001 was one of the first applications in the industry equipped with Mobileyes EyeQ5Hsystems on chips(SoCs).The AD domain controller solution we provided for ZEEKRcontributed to nil,48.2%,
76、93.6%and 93.5%of our total revenue for the three years endedDecember 31,2022,and six months ended June 30,2023,respectively.For details,see“Business Our Customers Our Relationship with Geely Group”and“Business OurSuppliers Our Relationship with Mobileye.”We also collaborate with renowned upstreambus
77、iness partners,such as Renesas,Texas Instruments,and Sunny Optical,to deliver tailoredsolutions to our OEM customers.Through our established and stable partnerships with high-profile business partners andextensive experience in series production of autonomous driving solutions and products,we areabl
78、e to accurately and quickly assess the varying needs of our OEM customers and continueto expand our business relationships with OEMs.Meanwhile,as we continue to update ourtechnologies and enhance our solutions and products,we can respond to market trends in aSUMMARY 3 THIS DOCUMENT IS IN DRAFT FORM,
79、INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.timely manner.Therefore,leveraging our experience in the commercialization of autonomousdriving solutions and products and outstanding capabilities in se
80、ries production,we believethat we are able to seize the growth opportunities in the industry.OUR BUSINESS MODELDuring the Track Record Period,we generated most of our revenue from the sales of ourautonomous driving solutions and products to OEMs,which included AD domain controllersand iFC products.W
81、e develop autonomous driving solutions and products for OEMs leveragingour core vertically integrated competencies in product design and development,algorithm andfunction development,system integration and manufacturing,among others.Our solutions andproducts for autonomous driving can be installed o
82、n both new energy vehicles(NEVs)andinternal combustion engine(ICE)vehicles,and are capable of realizing comprehensiveautonomous driving functions.The process of provision of our autonomous driving solutions is illustrated as follows:Sensors SoCsMCUsPCBsMechanical PartsThe base version ofAD domain co
83、ntrollers(1)Key ComponentsProduct Design and DevelopmentAlgorithm and Function DevelopmentSystem IntegrationTest and ValidationManufacturingQuality Assurance and After-Market Service OTAKey Aspects of Our Integrated Solutions and CapabilitiesAD Domain ControllersIntelligent Front CamerasAutonomous D
84、riving-related R&D ServicesSolutions and ProductsNEVsICE Vehicles VehiclesOEMsiMotionSuppliersNotes:(1)This is only for SuperVision.Our suppliers provide us with components of our solutions and products in accordancewith our specific needs.We procure from the suppliers for standard electronic compon
85、ents likeSoCs,MCUs,integrated circuits,resistors,capacitors,inductors,and connectors that can meetour specifications.Additionally,we entrust some suppliers to manufacture certain parts used inour products and solutions,including PCBs,housings,and camera modules,in accordance withour designs.Our solu
86、tions and products for autonomous driving can be installed on both NEVsand ICE vehicles,and are capable of realizing comprehensive autonomous driving functions.In particular,we are responsible for product design and development,algorithm and functiondevelopment,as well as manufacturing for our self-
87、developed iDC and iFC products.SUMMARY 4 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.During the Track Record Period,we also generated revenue from(i)R&D servicesprovi
88、ded to OEMs in assistance of their autonomous driving projects,and(ii)the sales ofprinted circuit boards assembly(PCBA)products to third parties.Our R&D services areprimarily focused on three aspects:(i)the development of software and hardware forautonomous driving;(ii)the development of algorithms
89、and functions for autonomous driving;and(iii)functional safety consulting and validation.With respect to our sales of PCBAproducts to third parties,we mount different electronic components on the printed circuit board(PCB),such as SoCs,resistors,capacitors,and transmitters based on our customersspec
90、ifications to prepare fully usable circuit boards.We do not consider the sales of PCBAproducts to third parties as our core business and plan to gradually wind down sales of PCBAproducts to third parties over the next five years.However,we will continue to use our SMTlines to produce PCBA products a
91、s components of our own autonomous driving solutions andproducts.The table below sets forth a breakdown of our revenue by business line both in absoluteamount and as a percentage of our total revenue for the periods indicated:For the Year Ended December 31,For the Six Months Ended June 30,2020202120
92、2220222023(RMB in thousands,except for percentages)(Unaudited)Autonomous drivingsolutions and products AD domaincontroller solutions86,01048.2%1,249,83494.3%335,95993.5%515,53594.9%ZEEKR86,01048.2%1,240,40093.6%333,61492.9%507,67193.5%Smart1,4890.1%1,0590.3%430.0%Polestar(1)1,0750.2%Chery3,7100.7%Ot
93、hers(2)7,9450.6%1,2860.3%3,0360.5%Intelligent frontcameras4400.9%1440.1%3,1150.2%7960.3%5,3211.0%Subtotal4400.9%86,15448.3%1,252,94994.5%336,75593.8%520,85695.9%Autonomous driving-related R&D services4,82610.1%34,50319.4%37,9562.9%5,4601.5%12,0832.2%Sales of PCBA products42,38989.0%57,60132.3%34,977
94、2.6%16,9564.7%10,2731.9%Total47,655100.0%178,258100.0%1,325,882100.0%359,171100.0%543,212100.0%Notes:(1)The sales to Polestar were made through an affiliate of Geely Group.(2)The amount represents revenue from(i)sales of AD domain controller solutions to be installed on certainvehicle models which h
95、ave discontinued or suspended sales and(ii)sales of materials and sample productsunrelated to a specific vehicle model.SUMMARY 5 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DO
96、CUMENT.OUR AUTONOMOUS DRIVING SOLUTIONS AND PRODUCTSWe offer various autonomous driving solutions and products,which included AD domaincontrollers and iFC products.With respect to AD domain controllers,we generated asignificant portion of revenue from SuperVision during the Track Record Period,which
97、 weredeveloped based on Mobileyes technology including the base version of AD domaincontrollers.In addition,we also supplied our self-developed iDC series to OEM customers.Our AD domain controller solutions typically include(i)an AD domain controller;(ii)associated sensors,which we procure from thir
98、d-party suppliers and integrate into oursolutions;(iii)integrated software,algorithms and functions;and(iv)relevant services such assensor implementation,vehicle systems integration,and function testing and validation.OEMcustomers may procure sensors themselves.In such case we do not provide sensori
99、mplementation or integration services and instead we only provide a limited number ofservices focusing on autonomous driving function testing and validation.An AD domaincontroller functions as the brain in autonomous driving solutions,fusing and processing datafrom sensors to make driving decisions
100、and trigger actuators in the vehicles.We also offer iFC products to OEMs based on our core algorithms on a stand-alone basiswithout providing relevant implementation and installation services.Our iFC product,whichincorporates a controller supported by a SoC and a camera,is able to independently real
101、izelevel 2 autonomous driving functions.The iFC products can also be used as a smart sensor inan autonomous driving solution powered by an AD domain controller,such as the iDC Midsolution,in order to provide more autonomous driving functions.The following table sets for a breakdown of our revenue ge
102、nerated from autonomousdriving solutions and products by product line for the periods indicated.For the Year Ended December 31,For the Six MonthsEnded June 30,20202021202220222023(RMB in thousands)(Unaudited)Autonomous drivingsolutions and products SuperVisionTM86,0101,248,795335,959510,225 iDC Mid4
103、412,573 iFC 2.04401443,1157965,321 Others(1)5982,737Total44086,1541,252,949336,755520,856Note:(1)Representing sales of complementary products alongside the main products,and materials unrelated toa specific vehicle model.SUMMARY 6 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND T
104、HAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.We integrate both hardware and software into our autonomous driving solutions andproducts.Leveraging our superior software-hardware co-design capabilities,we developproprietary middleware tha
105、t can be used as a bridge to connect software with the underlyinghardware.We develop algorithms to enable different autonomous driving functions and provideOEMs with comprehensive services such as system diagnosis and over-the-air(OTA)updates.We believe that our solutions and products have the follo
106、wing advantages:SuperVisionTM.SuperVision is a fully operational point-to-point assisted drivingnavigation solution on various road types and includes cloud-based enhancementsand supports OTA updates subject to the systems operational domain design(ODD).Equipped with 11 cameras powered by two Mobile
107、yes EyeQ5H SoCs,SuperVision has superior visual perception capabilities and offers one of the mostcomprehensive autonomous driving functions covering driving scenarios in itsdefined ODD.SuperVision meets the specific needs of premium intelligentvehicle models of our OEM customers,equipping them with
108、 a distinctive advantageto compete on the global market.SuperVision can achieve level 2+autonomousdriving,including more advanced level 2+functions such as navigate on autopilotin urban areas(Urban NoA).The series production of SuperVision under ourproject in collaboration with Mobileye for ZEEKR 00
109、1 commenced in October2021.For SuperVision supplied to our OEM customers,we act as the systemintegrator and are not responsible for the assembly or manufacturing.iDC Series.The iDC series is our self-developed AD domain controller product line.Compared to the typical architecture that includes both
110、SoC and microcontroller(MCU),we creatively developed an advanced software architecture for our iDCseries that integrates high-speed driving functions and low-speed parking functionsinto one SoC only,enabling product cost reduction and system efficiencyenhancement.iDC Mid,which started series product
111、ion in January 2023,is acost-effective solution targeting the mid-to high-end vehicle market that canachievelevel2+autonomousdriving.Empoweredbyourflexiblesystemarchitecture,iDC Mid offers exceptional adaptability,allowing it to be used on avariety of vehicle models of our OEM customers.Our propriet
112、ary algorithms enableiDC Mid to integrate navigate on autopilot(NoA),home-zone parking assistance(HPA),automatic parking assistance(APA),surround view 3D display(SV3D),safety assistance,and other driver assistance functions.We expect the series production of iDC High,an enhanced version of iDC Mid t
113、hatcan achieve level 2+autonomous driving,to start in 2024.The upcoming iDC Highwill have a higher computing power and enhanced sensor configuration,comparedto iDC Mid.It will be able to support a full-scenario intelligent driving experience.Designed for mid-to high-end vehicles,iDC High will includ
114、e all autonomousdriving functions of iDC Mid.In addition,it will include more advancedautonomous driving functions,such as Urban NoA,and more advanced parkingfunctions to cover more scenarios.SUMMARY 7 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE RE
115、AD IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.iFC Series.Our iFC series is a budget solution for level 2 autonomous driving thatincludes both comfort functions(such as LCC and ACC)and safety assistancefunctions(such as emergency lane keeping(ELK)and automatic emerge
116、ncy braking(AEB).iFC 2.0 has started series production in August 2021 and can meet C-NCAPand EURO-NCAP 2023 5-star safety standards as well as GSR regulatory standards.We plan to launch the iFC 3.0 solution in 2024,which is targeted to meet futureC-NCAP and EURO-NCAP 5-star safety standards.Due to i
117、ts enhanced perceptioncapabilities,more compact size,and enhanced function extension capabilities,ouriFC 3.0 is expected to meet the upgrading needs of our OEM customers.Regarding our self-developed iDC and iFC series,our role extends beyond being a systemintegrator.We take on various responsibiliti
118、es after entering the series production stage,including the procurement of raw materials and components based on our designs,assembly,installation of our proprietary autonomous driving software,functional testing,packaging anddelivery.As of the Latest Practicable Date,we obtained letters of nominati
119、on associated with 15renowned OEM customers,such as Geely,Great Wall Motor,Chery and Dongfeng,amongothers,who sourced or are expected to source AD domain controllers and iFC products fromus.Obtaining a letter of nomination indicates that we are selected as a designated supplier forautonomous driving
120、 solutions and products for a particular vehicle model of an OEM customer,and are qualified to join an OEMs supply chains for such particular vehicle model.However,there is no guarantee that our OEM customers will purchase our solutions and products in largequantities or at all and at a price that w
121、ill be profitable to us even having entered into a letterof nomination and no certainty of finalization of contract and such letter of nomination maybe terminated.During the Track Record Period and up to the Latest Practicable Date,two OEMcustomers ceased cooperation with us.To our knowledge based o
122、n communication withMobileye,Mobileye and Polestar may collaborate with another system integrator to incorporateMobileyes next-generation autonomous driving solutions,including ChauffeurTM,into aparticular vehicle model of Polestar that we have agreed to work on.Moreover,the lengthydevelopment cycle
123、s of autonomous driving solutions result in our significant investment ofresources prior to realizing any revenue from a vehicle model,and we may not be able torecover the significant upfront costs incurred.For details,see“Risk Factors There is noguarantee that our OEM customers or OEM end customers
124、 will purchase our solutions andproducts in any certain quantity or at any certain price even after we obtain the letter ofnomination,and there may be significant delays between the time we obtain the letter ofnomination until we realize revenue from the vehicle model.”SUMMARY 8 THIS DOCUMENT IS IN
125、DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.OUR RELATIONSHIP WITH GEELY GROUP AND MOBILEYEThe Linkage Between Mobileye and Geely GroupFor the years ended December 31,2020,2021 and 2022 a
126、nd the six months endedJune 30,2023,nil,91.0%,97.2%and 98.6%of our revenue generated from Geely Grouprelates to SuperVision,respectively,which is based on the base version of AD domaincontrollers supplied by Mobileye.As of the Latest Practicable Date,we,in collaboration withMobileye,supplied SuperVi
127、sion for three series-produced vehicle models from GeelyGroups premium electric vehicle brand,namely ZEEKR 001,ZEEKR 009 and ZEEKR 001(European version).The AD domain controller solution we provided for ZEEKR contributedto nil,48.2%,93.6%and 93.5%of our total revenue for the years ended December 31,
128、2020,2021 and 2022 and six months ended June 30,2023,respectively.Our initial cooperation with Geely Group dates back to October 2020 when both partiesstarted cooperation in R&D of level 2+autonomous driving solutions.In July 2020,weengagedininitialdiscussionswithMobileyeregardingthemanufacturingand
129、commercialization of SuperVision.Subsequently,in August 2020,upon becoming aware ofthe new vehicle model planned for launch by Geely Group,further discussions took placebetween us and Mobileye concerning potential collaboration and work allocations for theintegration of SuperVision on ZEEKR 001.In O
130、ctober 2020,we received the letter ofnomination for SuperVision and since then,we have become one of the key suppliers ofautonomous driving solutions and products for Geely Group,especially under its ZEEKRbrand.In relation to the supply of SuperVisionTM,in 2021 and 2022,tripartite product waivershav
131、e been entered into among Geely Group,our Company and Mobileye,pursuant to which,(i)Mobileye did not offer a warranty for the base version of AD domain controllers ofSuperVision that we acquired in 2021 and 2022.Instead,any costs and expenses related tothe repair or replacement of these products due
132、 to any failure would be borne by Geely Group,and(ii)Geely Group and our Company shall indemnify,severally and jointly,Mobileye againstall costs and expenses resulting from product liability claims associated with the utilization ofbase version of AD domain controllers acquired in 2021 and 2022.No w
133、aiver was signed for2023.For details,see“Business The Linkage Between Mobileye and Geely Group.”Our Relationship with Geely GroupSince June 2021,we have been engaged by Geely Group as a non-exclusive supplier todevelop level 2+autonomous driving solutions deployed on its vehicles.In 2021 and 2022 an
134、dfor the six months ended June 30,2023,Geely Group was our largest customer.For the yearsended December 31,2021 and 2022 and the six months ended June 30,2023,our revenue fromGeely Group was RMB94.5 million,RMB1,277.5 million and RMB516.0 million,respectively,which accounted for 53.0%,96.4%and 95.0%
135、of our total revenue during the same period.Asof the Latest Practicable Date,we,in collaboration with Mobileye,supplied SuperVision forthree series-produced vehicle models from Geely Groups premium electric vehicle brand,namely ZEEKR 001,ZEEKR 009 and ZEEKR 001(European version).SUMMARY 9 THIS DOCUM
136、ENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.During the Track Record Period and up to the Latest Practicable Date,we maintained astable relationship with Geely Group and there w
137、as no material interruption or dispute inrespect of our cooperation with Geely Group.However,we cannot guarantee that Geely Groupwill continue to partner with us or will not reduce its business with us.In recent years,GeelyGroup has started developing its various in-house autonomous driving capabili
138、ties for itsvehicle models,and it is also collaborating with other suppliers to develop autonomous drivingsolutions.To our knowledge based on communication with Mobileye,Mobileye and Polestarmay collaborate with another system integrator to incorporate Mobileyes next-generationautonomous driving sol
139、utions,including ChauffeurTM,into a particular vehicle model ofPolestar that we have agreed to work on.Given our substantial revenue concentration on GeelyGroup,if Geely Group decides to terminate or decrease the level of its cooperation with us inthe future,it may result in a material and adverse e
140、ffect on our business,financial conditionand results of operations.For details,see“Risk Factors Risks Relating to Our Business andIndustry We are subject to concentration risk of deriving a substantial portion of revenuefrom our sales to Geely Group and from SuperVision and the loss of,or a signific
141、antreduction in,revenue from such customers or products could materially and adversely affectour results of operations.”Due to our revenue concentration on Geely Group,we are exposedto a certain level of credit risk.See“Risk Factors We are exposed to credit risk arising fromour revenue concentration
142、 on certain customers,including Geely Group.Failure to collect ourtrade receivables in a timely manner or at all could have a material and adverse impact on ourbusiness,financial condition,liquidity and prospects”Our Directors are of the view that(i)our Groups business model is sustainable despiteou
143、r customer concentration;(ii)there is little likelihood that Geely Group will procureSuperVision from Mobileye directly;(iii)the likelihood that Geely Group will procureSuperVision from another collaboration partner of Mobileye is relatively low;and(iv)thelikelihood of the OEMs replacing SuperVision
144、 with alternative solutions in vehicles alreadyequipped with it is low.For details,see“Business Our Customers Our Relationship with Geely Group.”Our Relationship with MobileyeMobileye is our key supplier for our autonomous driving solutions and products.It wasour largest supplier in 2021 and 2022 an
145、d for the six months ended June 30,2023.In 2021,2022 and the six months ended June 30,2023,our revenue generated from the sales ofSuperVision amounted to RMB86.0 million,RMB1,248.8 million and RMB510.2 million,respectively,which accounted for 48.3%,94.2%and 93.9%of our total revenue during thesame p
146、eriods,respectively.During the Track Record Period,we primarily procured fromMobileye(i)the base version of AD domain controllers for the SuperVision solution;and(ii)EyeQseries SoCs for our iFC products.SUMMARY 10 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATI
147、ON MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.For SuperVision solution supplied to our customers,we act as a system integrator.Weacquire the base version of AD domain controllers from Mobileye and provide technicalexpertise in the area of system,mechanic
148、al and optical engineering in tailoring and enhancingthe system architecture of SuperVision for each different vehicle models according to therequirements of OEMs.We are responsible for vehicle integration,testing and validation,andin some projects,we also provide associated sensors procured from th
149、ird-party suppliers.Weprovide technical advice for system architecture enhancement,with particular emphasis onoptimizing the image chain to reduce latency and seamlessly integrating the parking functionswith the entire system.Mobileye outsources the manufacturing of the base version of ADdomain cont
150、rollers to a third-party manufacturer.As of the Latest Practicable Date,we werenot responsible for the manufacture or assembly of the hardware of SuperVisionTM.Theintellectual property rights of SuperVision,including its trademark,belong to Mobileye.Mobileye is also supplying SuperVision to other OE
151、Ms in collaboration with other Tier1 suppliers.If there is any discontinuation,or loss of business with respect to our cooperationwith Mobileye,our business,results of operations and financial condition could be materiallyand adversely affected.For instance,to our knowledge based on discussion with
152、Mobileye,Mobileye and Polestar may collaborate with another system integrator to incorporateMobileyes next-generation autonomous driving solutions,including ChauffeurTM,into aparticular vehicle model of Polestar that we have agreed to work on.See“Risk Factors Werely on third-party suppliers,includin
153、g,in particular Mobileye in relation to SuperVisionTM,and because some of the raw materials and key components in our products come from singleor limited source of suppliers,we are susceptible to supply shortages,long lead times forcomponents,and supply changes,any of which could disrupt our supply
154、chain and could delaydeliveries of our products to customers.”Our Directors are of the view that(i)our Groups business model is sustainable althoughthe total purchase from Mobileye accounted for a majority portion of our purchase during 2021and 2022 and the six months ended June 30,2023;and(ii)the r
155、isk of Mobileye ceasing tosupply to us because of cannibalization between SuperVision and iDC series is relativelylow.For details,see“Business Our Suppliers Our Relationship with Mobileye.”OUR CORE TECHNOLOGIESOur comprehensive R&D capabilities are the bedrock of our success in the developmentand co
156、mmercialization of autonomous driving solutions and products,as highlighted by our(i)core algorithms,(ii)flexible middleware,and(iii)data loop and cloud platform.We utilize ourcore technologies to develop the iDC and iFC products.Core algorithms.We have developed a set of algorithms for autonomous d
157、riving,ashighlighted by our perception and vehicle localization algorithms.By employingcontinuous data feedback loops,these algorithms can effectively handle morecomplex autonomous driving scenarios,including urban areas.Furthermore,we areworking with our business partners to customize the hardware
158、accelerationframework for our own system so as to further improve the efficiency of algorithms.SUMMARY 11 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.We have designed
159、 our vehicle localization algorithms to work on both open roadsand in closed areas.Using our accurate visual scale recovery algorithms and vehiclelocalization algorithms,our HPA can support long-distance memory parking up totwo kilometers in underground garages.We are also developing simultaneousloc
160、alization and mapping algorithms for open roads,aiming to resolve the limitedand outdated map coverage issue of high-definition maps.Middleware.Our self-developed middleware does not rely on any open-sourceframework and removes the communication barrier between embedded MCUs andSoCs,allowing zero-co
161、py data sharing in heterogeneous systems which improvesthe performance of systems by eliminating intermediate buffers when transferringdata.Through our self-developed middleware,we can deploy our software ondifferent computing platforms and operating systems,enabling us to quickly adaptto the hardwa
162、re of various OEMs,reducing the time and cost of system developmentand improving the adaptability and iterability of our solutions and products.Data loop and the cloud platform.During the development process of our solutionsand products,we work closely with a top-tier third-party map maker in China
163、whoprovides data collection,desensitization and anonymization services.The processeddata are stored on our cloud platform for development and test purposes.After the launch of vehicles installed with our iDC Mid,we plan to proactivelypartner with OEM customers in obtaining real-world data,and have o
164、ur OEMcustomers store the data on their selected platforms and for us to have access to onlythe desensitized and anonymized data for software update purposes.Based on therich repository of real-world data,we can monitor performance and captureopportunities to enhance the performance and functionalit
165、y of our autonomousdriving solutions and products.In particular,we can continuously update ourautonomous driving algorithms and achieve a relatively short iteration cycle.OUR COMPETITIVE STRENGTHSWe believe the following competitive strengths contributed to our historical success andwill drive our f
166、uture growth.A Tier 1 autonomous driving solution provider in China with competitive edge;Advanced autonomous driving technologies;Proven ability to commercialize autonomous driving solutions and products in largescale;SUMMARY 12 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND TH
167、AT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.Comprehensive autonomous driving solution and product portfolio covering a wideprice range of vehicles;Well-established partnerships with industry leaders;andExperienced management team suppor
168、ted by renowned shareholders.OUR STRATEGIESWe plan to implement the following strategies:Continue to pioneer the large-scale commercialization of autonomous drivingsolutions and products;Increase our investment in R&D to solidify our leading position and prepare forcommercialization of level 4 auton
169、omous driving;Continue to deepen,expand,and diversify our OEM customer base;Enhance our value chain integration capabilities;andBuild an international brand with a global presence.OUR CUSTOMERSOur customers primarily consist of OEMs that install our autonomous driving solutionsand products on their
170、vehicles.Substantially all of our revenue is generated within the PRC.For the years ended December 31,2020,2021 and 2022 and for the six months ended June 30,2023,our revenue generated from the five largest customers in each period in aggregateaccounted for 84.2%,92.1%,99.4%and 99.0%of our total rev
171、enue,respectively,and revenuegenerated from our largest customer in the relevant periods accounted for 63.0%,53.0%,96.4%and 95.0%of our total revenue,respectively.For details,see“Business OurCustomers.”OUR SUPPLIERSOur suppliers primarily consist of raw materials and components suppliers,includingsu
172、ppliers for automotive-grade chips,mechanical parts,optical components,and electricalparts.For the years ended December 31,2020,2021 and 2022 and the six months ended June30,2023,purchases from our five largest suppliers in each period in aggregate accounted for53.4%,78.9%,96.0%and 95.0%of our total
173、 purchases,respectively,and purchases from ourlargest supplier in the relevant periods accounted for 23.2%,54.6%,69.2%and 90.3%of ourtotal purchases,respectively.For details,see“Business Our Suppliers.”SUMMARY 13 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATIO
174、N MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.SCALABLE MANUFACTURING PROCESSOur self-developed AD domain controllers and iFC products are assembled in our ownmanufacturing facility from a variety of raw materials and components,some of which,including mec
175、hanical parts,automotive-grade chips,cameras,and electrical parts,are procuredfrom reputable third-party suppliers.Our in-house manufacturing and testing capabilities andstrict quality control measures enable us to ensure the high performance and reliability of ourproducts.Our current manufacturing
176、facility,which commenced production in July 2018,islocated in Suzhou,Jiangsu Province,neighboring the hub of OEMs and automotive suppliersin China.For details,see“BusinessScalable Manufacturing Process.”RESEARCH AND DEVELOPMENT OF OUR SOLUTIONS AND PRODUCTSOur deep passion for innovation coupled wit
177、h our strong R&D capabilities have allowedus to compete in the industry.Our team of engineers forms the foundation for ourcompetitiveness.As of June 30,2023,we had 250 R&D personnel,representing 74.2%of ourtotal employees.We incurred research and development expenses of RMB44.1 million,RMB54.9 milli
178、on,RMB104.0 million and RMB104.0 million for the years ended December31,2020,2021 and 2022 and the six months ended June 30,2023,respectively.For details,see“Business Research and Development of Our Solutions and Products R&D Process.”SUMMARY OF KEY FINANCIAL INFORMATIONThe summary of the key financ
179、ial information set forth below have been derived from andshould be read in conjunction with our consolidated financial statements,including theaccompanying notes,set forth in the Accountants Report in Appendix I to this document,aswell as the information set forth in the section headed“Financial In
180、formation.”SUMMARY 14 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.Summary of Consolidated Statements of Comprehensive IncomeThefollowingtablesetsforthasummaryofourcon
181、solidatedstatementsofcomprehensive income in absolute amounts and as percentages of total revenue for the periodsindicated.Our historical results presented below are not necessarily indicative of the resultsthat may be expected for any future period.For the Year Ended December 31,For the Six Months
182、Ended June 30,20202021202220222023(RMB in thousands,except for percentages)(Unaudited)Revenue47,655100.0%178,258100.0%1,325,882100.0%359,171100.0%543,212100.0%Cost of sales(38,059)(79.9)%(141,475)(79.4)%(1,215,309)(91.7)%(336,069)(93.6)%(502,173)(92.4)%Gross profit9,59620.1%36,78320.6%110,5738.3%23,
183、1026.4%41,0397.6%Selling expenses(3,046)(6.4)%(9,403)(5.3)%(27,681)(2.1)%(16,096)(4.5)%(13,565)(2.5)%Administrative expenses(8,591)(18.0)%(29,715)(16.7)%(41,517)(3.1)%(14,203)(4.0)%(38,382)(7.1)%Research anddevelopment expenses(44,141)(92.6)%(54,948)(30.8)%(104,047)(7.8)%(46,430)(12.9)%(103,987)(19.
184、1)%(Net impairment)/reversal ofimpairment losses onfinancial assets(90)(0.2)%(1,453)(0.8)%(3,717)(0.3)%(1,471)(0.4)%2,9890.6%Other income3,7167.8%3,4211.9%4,7100.4%4730.1%4,2240.8%Other gains/(losses)net(387)(0.8)%4,9292.8%(628)(0.0)%(567)(0.2)%6,1331.1%Operating loss(42,943)(90.1)%(50,386)(28.3)%(6
185、2,307)(4.7)%(55,192)(15.4)%(101,549)(18.7)%Finance income90.0%940.1%1000.0%850.0%2,0340.4%Finance costs(10,893)(22.9)%(413,907)(232.2)%(280,169)(21.1)%(245,325)(68.3)%(233)(0.0)%Finance(costs)/income net(10,884)(22.9)%(413,813)(232.1)%(280,069)(21.1)%(245,240)(68.3)%1,8010.3%Loss before income tax(5
186、3,827)(113.0)%(464,199)(260.4)%(342,376)(25.8)%(300,432)(83.6)%(99,748)(18.4)%Income tax expensesLoss for theyear/period(53,827)(113.0)%(464,199)(260.4)%(342,376)(25.8)%300,432)(83.6)%(99,748)(18.4)%SUMMARY 15 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION M
187、USTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.Adjusted Loss(Non-IFRS Measure)To supplement our consolidated financial statements,which are presented in accordancewith IFRSs,we also use the adjusted loss(Non-IFRS measure)as an additional financialmeasure,whic
188、h is not required by,or presented in accordance with,IFRSs.We believe that thepresentation of non-IFRS measures facilitates comparisons of operating performance from yearto year and provides useful information to REDACTED and others to understand andevaluate our consolidated results of operations in
189、 the same manner as our management.We also believe that the non-IFRS measures are appropriate for evaluating our operatingperformance.The use of this non-IFRS measure has limitations as an analytical tool,and youshould not consider it in isolation from,or as a substitute for analysis of,our results
190、ofoperations or financial conditions as reported under IFRS.In addition,this non-IFRS measuremay not be comparable to similar measures presented by other companies.We define the adjusted loss(Non-IFRS measure)as the loss for the year,excluding(i)share-based payment,(ii)financial cost on financial in
191、struments with preferred rights atamortized cost,and(iii)REDACTED expenses.Our management considered the share-basedpayment and financial cost on financial instruments with preferred rights at amortized cost asnon-cash items.During the Track Record Period,we recorded financial instruments withprefer
192、red rights in connection with the issuance by our Company to Pre-REDACTEDInvestors of ordinary shares with preferred rights in Pre-REDACTED financings thatconferred certain preferred rights,including redemption rights,upon such Pre-REDACTEDInvestors.We have ceased to record any such financial cost o
193、n financial instruments withpreferred rights at amortized cost with respect to the preferred rights previously conferred uponthe Pre-REDACTED Investors,because we and the related Pre-REDACTED Investorshave mutually agreed to terminate such preferred rights.The following table sets forth the reconcil
194、iations of our non-IFRS measures for the periodindicated with the nearest measured prepared in accordance with IFRS:For the Year Ended December 31,For the Six MonthsEnded June 30,20202021202220222023(RMB in thousands)(Unaudited)Non-IFRS measuresLoss for the year/period(53,827)(464,199)(342,376)(300,
195、432)(99,748)Add:Share-based payment8,55417,70844,02622,12743,220Financial cost onfinancial instrumentswith preferred rights atamortized cost9,604412,362279,420244,680REDACTED expenses2,05610,367Adjusted loss(Non-IFRS measure)(35,669)(34,129)(16,874)(33,625)(46,161)SUMMARY 16 THIS DOCUMENT IS IN DRAF
196、T FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.Our loss for the year increased significantly from RMB53.8 million in 2020 to RMB464.2million in 2021,primarily due to an increase in financial co
197、st on financial instruments withpreferred rights at amortized cost,which was in relation to financial instruments with preferredrights in connection with the issuance by our Company to Pre-REDACTED Investors ofordinary shares in Pre-REDACTED financings that conferred certain preferred rights,represe
198、nting the redemption rights,granted to certain Pre-REDACTED Investors.Our lossfor the year decreased from RMB464.2 million in 2021 to RMB342.4 million in 2022,primarily due to(i)a decrease in financial cost on financial instruments with preferred rightsat amortized cost as a result of the terminatio
199、n of relevant preferred rights in 2022,and(ii)anincrease in gross profit as a result of our business growth following the series production ofour first SuperVision project in collaboration with Mobileye in October 2021.For the sixmonths ended June 30,2022 and 2023,our loss for the period was RMB300.
200、4 million andRMB99.7 million,respectively.The fluctuation was primarily due to a decrease in financialcost on financial instruments with preferred rights at amortized cost as a result of thetermination of relevant preferred rights in 2022.Summary of Consolidated Statements of Financial PositionThe f
201、ollowing table sets forth a summary of our consolidated statement of financialposition as of the dates indicated.As of December 31,As ofJune 30,2020202120222023(RMB in thousands)Current Assets73,580446,2351,155,498746,862Current Liabilities56,095156,618572,448220,243Non-current Assets33,63970,26995,
202、903101,224Non-current Liabilities167,481918,22012,48616,328Net Current Assets17,485289,617583,050526,619Net Assets/(Liabilities)(116,357)(558,334)666,467611,515Our net current assets decreased from RMB583.1 million as of December 31,2022 toRMB526.6 million as of June 30,2023,primarily due to the dec
203、rease of our current assetsoutpacing the decrease of our current liabilities.The decrease of our current assets wasprimarily due to(i)a decrease of RMB219.1 million in cash and cash equivalents,mainly inrelation to the payment of employee salaries,the purchase of certain wealth managementproducts an
204、d the repayment of bank borrowings,which were in line with our cash managementpolicy;(ii)a decrease of RMB162.5 million in trade and notes receivables,mainly as a resultof our customers settlement for sales accrued in the fourth quarter of 2022 and the decreaseof sales in the first half of 2023 comp
205、ared to the second half of 2022;and(ii)a decrease ofRMB109.9 million in inventories,mainly attributable to the recognition of cost of sales for thedelivered finished goods at the end of 2022.The decrease of our current liabilities wasSUMMARY 17 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT T
206、O CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.primarily due to(i)a decrease of RMB310.0 million in trade and notes payables primarilybecause we settled large portion of trade payables as of December 31,2022 and lowered thep
207、rocurement amount of raw materials as a result of the decrease of sales in the first half of 2023compared to the second half of 2022,as well as the discontinuation of certain business,forwhich we used notes as the main payment method;and(ii)a decrease of RMB49.0 million inborrowings as a result of t
208、he full settlement of our outstanding borrowings.Our net current assets increased from RMB289.6 million as of December 31,2021 toRMB583.1 million as of December 31,2022,primarily due to(i)an increase of RMB333.7million in cash and cash equivalents,as a result of the proceeds we received from the Ser
209、iesC Financing;(ii)an increase of RMB225.0 million in inventories which we accumulated inresponse to an increase in the demand for our solutions and products;(iii)an increase ofRMB178.1 million in trade and notes receivables,primarily attributable to the increase in tradereceivables due from third p
210、arties,which was in line with our business expansion,partiallyoffset by an increase of RMB348.0 million in trade and notes payables,as we purchased morematerials for our production in line with our business expansion in 2022.Our net current assets increased from RMB17.5 million as of December 31,202
211、0 toRMB289.6 million as of December 31,2021,primarily due to(i)an increase of RMB218.4million in financial assets at FVTPL,as we purchased more wealth management products in2021;and(ii)an increase of RMB96.0 million in trade and notes receivables,primarilyattributable to the increase of due from thi
212、rd parties,which was in line with our businessexpansion,partially offset by an increase of RMB83.7 million in trade and notes payables,aswe purchased more materials for series production in line with our business expansion in 2021.Our net liabilities increased significantly from RMB116.4 million as
213、of December 31,2020 to RMB558.3 million as of December 31,2021,primarily due to loss for the year ofRMB464.2 million and recognition of financial instruments with preferred rights at amortizedcost of RMB323.2 million,partially offset by capital contribution from equity holders ofRMB327.7 million,as
214、a result of the issuance of shares that conferred preferred rights tocertain Pre-REDACTED Investors in 2021.We reverted to a net assets position and had netassets of RMB666.5 million as of December 31,2022,primarily due to the derecognition offinancial instruments with preferred rights at amortized
215、cost,as all shares with preferred rightsheld by our Pre-REDACTED Investors were reclassified from financial liabilities to equityafter the termination of relevant preferred rights in 2022,partially offset by loss for the yearof RMB342.4 million.We had net assets of RMB611.5 million as of June 30,202
216、3.Thedecrease of net assets from December 31,2022 to June 30,2023 was primarily due to loss forthe period of RMB99.7 million,partially offset by relevant share-based payment of RMB43.2million.For details,see“Consolidated Statements of Changes in Equity”in the AccountantsReport set out in Appendix I
217、to this document.SUMMARY 18 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.Summary of Consolidated Statements of Cash FlowThe following table sets forth a summary of our
218、 cash flows for the years/periodsindicated.For the Year Ended December 31,For the Six MonthsEnded June 30,20202021202220222023(RMB in thousands)(Unaudited)Operating cash flows beforechanges in working capital(27,249)(25,185)(3,820)(27,238)(57,988)Changes in working capital3,405(37,813)(61,847)(921)(
219、24,928)Interest received994100852,034Net cash(used in)/generated fromoperating activities(23,835)(62,904)(65,567)(28,074)(80,882)Net cash(used in)/generated frominvesting activities(33,138)(256,339)41,439(14,039)(80,170)Net cash generated from/(used in)financing activities70,828334,601355,90977,094(
220、58,566)Net increase/(decrease)in cashand cash equivalents13,85515,358331,78134,981(219,618)Cash and cash equivalents at thebeginning of the year/period3,06616,91232,04232,042365,745Exchange(losses)/gains on cashand cash equivalents(9)(228)1,922632560Cash and cash equivalents atthe end of year/period
221、16,91232,042365,74567,655146,687For the six months ended June 30,2023,we had net cash used in operating activities ofRMB80.9 million,primarily due to our loss before income tax of RMB99.7 million as adjustedby certain non-operating items,primarily including share-based payment expenses ofRMB43.2 mil
222、lion,and changes in certain working capital items,including(i)a decrease ofRMB165.5 million in trade and notes receivables and(ii)a decrease of RMB109.7 million ininventories,partially offset by a decrease of RMB310.0 million in trade and notes payables.In 2022,we had net cash used in operating acti
223、vities of RMB65.6 million,primarily dueto our loss before income tax of RMB342.4 million for the same period,as adjusted by certainnon-operating items,mainly including(i)net finance costs of RMB280.1 million and(ii)share-based payment expenses of RMB44.0 million,and changes in certain working capita
224、litems,primarily including(i)an increase in inventories of RMB225.0 million,(ii)an increasein trade and notes receivables of RMB181.8 million,and(iii)an increase in trade and notespayables of RMB348.0 million.SUMMARY 19 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INF
225、ORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.In 2021,we had net cash used in operating activities of RMB62.9 million,primarily dueto our loss before income tax of RMB464.2 million for the same period,as adjusted by certainnon-operating items,inclu
226、ding(i)net finance costs of RMB413.8 million and(ii)share-basedpayment expenses of RMB17.7 million,and changes in certain working capital items,primarilyincluding(i)an increase in trade and notes receivables of RMB97.5 million,(ii)an increase intrade and notes payables of RMB83.7 million,and(iii)an
227、increase in inventories of RMB37.7million.In 2020,we had net cash used in operating activities of RMB23.8 million,primarily dueto our loss before income tax of RMB53.8 million for the same period,as adjusted by certainnon-operating items,mainly including(i)net finance costs of RMB10.9 million and(ii
228、)share-based payment expenses of RMB8.6 million,and changes in certain working capitalitems,primarily including an increase in contract liabilities of RMB11.0 million.For a detailed discussion of the historical changes in certain key items in our consolidatedstatements of cash flows,see“Financial In
229、formation Liquidity and Capital Resources Cash Flows.”BUSINESS SUSTAINABILITYIn 2020,2021 and 2022 and for the six months ended June 30,2022 and 2023,werecorded an adjusted loss(Non-IFRS measure)of RMB35.7 million,RMB34.1 million,RMB16.9 million,RMB33.6 million and RMB46.2 million,respectively.In 20
230、20,2021 and2022,we also recorded a net operating cash outflow of RMB23.8 million,RMB62.9 millionand RMB65.6 million,respectively.Our losses during the Track Record Period were primarilybecause:(i)we operate in an emerging market.To further reinforce our presence andcompetitiveness in the emerging au
231、tonomous driving market,we have been focusing on R&D,product development and expansion of customer base,rather than seeking short-term return orprofitability;(ii)our economies of scale have not yet fully materialized.Although the increasein gross profit margin of AD domain controller solutions from
232、5.3%in 2021 to 7.4%in 2022indicated that we gradually achieved stronger economies of scale and had increasingbargaining power against suppliers,the yet-to-be-fully-materialized economies of scalecontributed to our losses during the Track Record Period;and(iii)we continually invest in theR&D of new p
233、roducts and autonomous driving technologies.Despite that we have been loss-making since 2020 and we expect to incur net loss and netoperating cash outflow in 2023,which is primary due to the expected increase in R&Dexpenses for new autonomous driving solutions,share-based payments and REDACTEDexpens
234、es in 2023,we have achieved a steady growth in terms of revenue and sales volume anddemonstrated a clear trajectory of profitability improvement.The sales volume of our main ADdomain controller solution during the Track Record Period,increased from 5,796 units in 2021to 79,589 units in 2022 and from
235、 21,272 units for the six months ended June 30,2022 to 42,108units for the six months ended June 30,2023.In addition,we have a healthy cash balance tosupport our operations and future business expansion.As of August 31,2023,we had cash andcash equivalents of RMB31.9 million,current financial assets
236、at FVTPL of RMB241.5 millionand unutilized bank facilities of RMB550.0 million.SUMMARY 20 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.In the future,we aim to maintain
237、 sustainability and achieve profitability through:(i)continuously growing revenue and expanding sales volume;(ii)improving gross margin;and(iii)enhancing operating leverage.With our improved profitability,we also expect ouroperating cash flow to improve concurrently.Continuously growing revenue and
238、sales volume.We have achieved a steadygrowth in revenue and sales volume during the Track Record Period.We expect thatour revenue and sales volume growth will be driven by the following factors:(1)Favorable Market Trend.The autonomous driving market and the market forautonomous driving solutions and
239、 products in China are expected to maintainsignificant growth momentum in the future.For details,see“IndustryOverview Overview of the AD Domain Controller Market”and“IndustryOverview Overview of the Intelligent Front Camera Market”;(2)Improving Solution and Product Offerings.We expect that the sales
240、 volume ofSuperVision and iDC Mid to grow robustly,primarily due to the expectedrapid growth of sales volume of existing and new vehicle models which adoptourautonomousdrivingsolutions,aswellasoureffortstoapplySuperVision and iDC products to additional vehicle models of both existingand new OEM cust
241、omers or OEM end customers.In addition,we expect tolaunch more autonomous driving solutions in the future.We expect that ourcontinuous investment in enhancing our solution and product offerings willincrease our sales and improve our profitability;and(3)Customer Retention and Expansion.We expect to d
242、eepen our relationshipswith existing OEM customers and expand our customer base in terms ofbreadth and depth.We have established stable collaborations with top-tierdomestic and international OEMs.Leveraging the expanding NEV market,ourincreasing marketing efforts,well-rounded capabilities and proven
243、 trackrecord,we have been,and will be continuously expanding our customer basein terms of breadth and depth.SUMMARY 21 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.Imp
244、roving Gross Margin.Our ability to manage and control our costs is critical tothe success of our business and our profitability.We believe that we are able toimprove our gross profit margin,primarily due to the following factors:(1)Better product mix with higher margins.We intend to improve our gros
245、s profitmargin by launching additional autonomous driving solutions and productswith higher margins.As we endeavor to apply iDC Mid,iDC High and iFC 3.0to additional vehicle models of both our existing and new OEM customers,sales of these solutions and products are expected to contribute to a larger
246、proportion of total sales,resulting in higher overall gross profit margin.(2)Improving production capabilities and expanding production capacity.Weintend to improve our production capabilities and the level of automation ofour production lines with our internally generated funds and REDACTEDfrom the
247、 REDACTED.Although such investments may result in an increasein our capital expenditure in short term,we believe the in-house production ofour products will allow us to simplify the supply chain and maintain ahigh-level of cost efficiency,and in turn improve our profitability ultimately.(3)Stronger
248、bargaining power as achieving increasing economies of scale.Ourgross profit margin of AD domain controller solutions increased from 5.3%in2021 to 7.4%in 2022,and from 6.3%for the six months ended June 30,2022to 7.2%for the six months ended June 30,2023,indicating that we graduallyachieved stronger e
249、conomies of scale and had increasing bargaining poweragainst suppliers following the series production of our first SuperVisionproject in collaboration with Mobileye in October 2021.In the future,with theexpected increasing sales volume of SuperVision and the series productionof iDC Mid,we expect to
250、 benefit from the increasing economies of scale andfurther improve our profitability.Enhancing Operating Leverage.During the Track Record Period,we incurredsignificant operating expenses,including R&D expenses,administrative expensesand selling expenses,to develop,manage and promote new autonomous d
251、rivingsolutions.We endeavor to enhance operating leverage by maintaining R&Dexpenses,selling expenses,and administrative expenses as a percentage of revenueat a relatively stable level as our business continues to scale up,thus alleviating thepace of cash outflow in relation to the operating expense
252、s.For detailed strategies and measures we plan to take to achieve long-term profitability,see“Business Business Sustainability.”SUMMARY 22 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER
253、OF THIS DOCUMENT.PRE-REDACTED INVESTORSSince the establishment of our Company,we have received several rounds of equityfinancing from our Pre-REDACTED Investors such as Zizhi Yihao,Beijing CHJ,SME Fund,Mixed Reform Fund and HL Klemove Suzhou.Pursuant to applicable PRC laws,thePre-REDACTED Investors
254、shall not dispose of any of the Shares held by them within 12months following the REDACTED.For details of our Pre-REDACTED Investments,see“History and Corporate Structure Pre-REDACTED Investments”in this document.OUR CONTROLLING SHAREHOLDERSAs of the Latest Practicable Date,Mr.SONG Yang,our founder,
255、Chairman,executiveDirector and chief executive officer,directly and indirectly(through Lanchi Platform,ZichiPlatform,Suzhou Hongchi and Suzhou Luchi),was entitled to exercise the voting rightsattaching to approximately 39.9%of the issued share capital of our Company.Immediatelyfollowingthecompletion
256、oftheREDACTED(assumingtheREDACTED is not exercised),Mr.SONG Yang,directly and indirectly(through LanchiPlatform,Zichi Platform,Suzhou Hongchi and Suzhou Luchi),will be entitled to exercise thevoting rights attaching to approximately REDACTED%of the issued share capital of ourCompany.Accordingly,upon
257、 completion of the REDACTED,Mr.SONG Yang,LanchiPlatform,Zichi Platform,Suzhou Hongchi and Suzhou Luchi will collectively constitute agroup of Controlling Shareholders of our Company.Please see“History and CorporateStructure”for more information about our shareholding structure.DIVIDENDSWe did not de
258、clare or pay dividends on our Shares during the Track Record Period.Wecurrently expect to retain all future earnings for use in operation and expansion of our business,and do not anticipate paying cash dividends in the foreseeable future.The declaration andpayment of any dividends in the future will
259、 be determined by our Board of Directors andsubject to our Articles of Association and the PRC Company Law,and will depend on a numberof factors,including our earnings and financial condition,operating requirements,capitalrequirements and any other conditions that our Directors may deem relevant.As
260、confirmed byour PRC Legal Advisors,any future net profit that we make will have to be applied to makeup for our historically accumulated losses in accordance with the PRC laws,after which wewill be obliged to allocate 10%of our profit to our statutory common reserve fund until suchfund has reached m
261、ore than 50%of our registered capital.We will therefore only be able todeclare dividends after(i)all our historically accumulated losses have been made up for;and(ii)we have allocated sufficient profit to our statutory common reserve fund as describedabove.In light of our accumulated losses as discl
262、osed in this document,it is unlikely that wewill be eligible to pay a dividend out of our profits in the foreseeable future.SUMMARY 23 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF T
263、HIS DOCUMENT.REDACTEDWeestimatethatwewillreceiveREDACTEDfromtheREDACTEDofapproximately HK$REDACTED,after deducting REDACTED commissions,fees andestimated expenses payable by us in connection with the REDACTED,assuming no exerciseof the REDACTED,and assuming an REDACTED of HK$REDACTED per Share,which
264、 is the mid-point of the indicative REDACTED range stated in this document.If theREDACTED is set at HK$REDACTED per Share,which is the high end of the indicativeREDACTEDrange,theREDACTEDfromtheREDACTEDwillincreasebyapproximately HK$REDACTED.If the REDACTED is set at HK$REDACTED perShare,which is the
265、 low end of the indicative REDACTED range,the REDACTED fromthe REDACTED will decrease by approximately HK$REDACTED.Assuming an REDACTED at the mid-point of the indicative REDACTED range,wecurrently intend to apply these REDACTED for the following purposes,subject to changesin light of our evolving b
266、usiness needs and changing market conditions:(i)approximately45.0%of the REDACTED or approximately HK$REDACTED,for enhancing researchand development of our autonomous driving solutions and products;(ii)approximately35.0%of the REDACTED or approximately HK$REDACTED,for capital expenditurein relation
267、to our R&D headquarters,manufacturing premises and new production lines;(iii)approximately 10.0%of the REDACTED or approximately HK$REDACTED,forexpandingoursalesandservicenetwork;and(iv)approximately10.0%oftheREDACTED or approximately HK$REDACTED,for working capital and generalcorporate purposes.For
268、 details,see“Future Plans and REDACTED.”RISK FACTORSOur business faces risks including those set out in the section headed“Risk Factors.”Asdifferent investors may have different interpretations and criteria when determining thesignificance of a risk,you should read the“Risk Factors”section in its en
269、tirety before youdecide to invest in the REDACTED.Some of the major risks that we face include:We are subject to concentration risk of deriving a substantial portion of revenuefrom our sales to Geely Group and from SuperVision and the loss of,or asignificant reduction in,revenue from such customers
270、or products could materiallyand adversely affect our results of operations;In particular,Mobileye maycollaborate directly with Geely Group;Geely Group and/or Mobileye may cooperatewith other Tier-1 suppliers;and Geely Group may develop its own autonomousdriving systems;We are an early-stage company
271、with a history of losses;we expect to incursignificant expenses and continuing losses in 2023,and we may continue to incurlosses in 2024 and beyond;our historical financial and results of operations may notbe indicative of our future performance;SUMMARY 24 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE A
272、ND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.There is no guarantee that our OEM customers or OEM end customers will purchaseour solutions and products in any certain quantity or at any certain price even afterw
273、e obtain the letter of nomination,and there may be significant delays between thetime we obtain the letter of nomination until we realize revenue from the vehiclemodel;If we fail to retain existing customers,attract new customers or increase thespending by our customers,our business and results of o
274、perations may be materiallyand adversely affected;If we are unable to develop and introduce new solutions and products and improveexisting solutions and products in a cost-effective and timely manner,ourcompetitive position would be negatively impacted and our business,results ofoperations,and finan
275、cial condition would be adversely affected;We rely on third-party suppliers,including,in particular Mobileye in relation toSuperVisionTM,and because some of the raw materials and key components in ourproducts come from single or limited source of suppliers,we are susceptible tosupply shortages,long
276、lead times for components,and supply changes,any of whichcould disrupt our supply chain and could delay deliveries of our products tocustomers;Our business collaboration with partners is subject to risks,and these relationshipsmay not lead to significant revenue.Any adverse change in our cooperation
277、 withthem could harm our business;We operate in highly competitive markets and some market participants may havesubstantially greater resources.We compete against a large number of bothestablished competitors and new market entrants;We are exposed to credit risk arising from our revenue concentratio
278、n on certaincustomers,including Geely Group.Failure to collect our trade receivables in atimely manner or at all could have a material and adverse impact on our business,financial condition,liquidity and prospects;Our business may suffer from claims relating to,among other things,actual oralleged de
279、fects in our solutions and products,or if our solutions and productsactually or allegedly fail to perform as expected,and publicity related to theseclaims could harm our reputation and decrease demand for our solutions andproducts or increase regulatory scrutiny of our solutions and products;SUMMARY
280、 25 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.Our autonomous driving products used on vehicles are highly complex and maycontain defects or otherwise fail to perfor
281、m in line with expectations,which couldreduce the market adoption of our products,damage our reputation with current orprospective customers,expose us to product liability and other claims and adverselyaffect our results of operations;We could be adversely affected as a result of any transactions we
282、 make with certainentities or in certain industries that are,or become subject to,sanctions and exportcontrols administered by the United States and other relevant sanctions authorities;andChanges in international relationships and trade policies may adversely impact ourbusiness,financial condition,
283、and results of operations.REDACTED EXPENSESBased on the mid-point REDACTED of HK$REDACTED per REDACTED,thetotal estimated REDACTED expenses in relation to the REDACTED is approximatelyRMBREDACTED,representing REDACTED%of the total REDACTED from theREDACTED of approximately HK$REDACTED(RMBREDACTED).W
284、e had incurredREDACTED expenses of RMB21.9 million as of June 30,2023,of which RMB12.5 millionhas been charged to our consolidated statement of comprehensive income and RMB9.4 millionwas recognized as deferred REDACTED expenses,which are expected to be recognizeddirectly as a deduction from equity u
285、pon the REDACTED.We expect to incur additionalREDACTEDexpensesofapproximatelyRMBREDACTED,ofwhichRMBREDACTED is expected to be charged to our consolidated statement of comprehensiveincomeandRMBREDACTEDwillbedeductedfromequity.TheamountoftheREDACTED-relatedexpensesofapproximatelyRMBREDACTED,whichmainl
286、yincludes REDACTED,is expected to be accounted for as a deduction from equity upon thecompletion of the REDACTED.The amount of the non-REDACTED-related expenses ofapproximately RMBREDACTED primarily include fees and expenses of legal advisers andaccountants of RMBREDACTED and other fees and expenses
287、 of RMBREDACTED.APPLICATION FOR REDACTED ON THE STOCK EXCHANGEWe have applied to the Listing Committee of the Stock Exchange for the granting of theREDACTED of,and permission to REDACTED our H Shares to be issued pursuant to(i)the REDACTED(including any H Shares which may be issued pursuant to the e
288、xercise ofthe REDACTED)and(ii)the H Shares to be converted from our existing Domestic Shareson the basis that,among other things,we satisfy the market capitalization/revenue test underRule 8.05(3)of the Listing Rules with reference to:(i)our revenue of RMB1,325.9 million(equivalent to approximately
289、HK$1,448.3 million)in the financial year ended December 31,2022 which exceeds HK$500 million,and(ii)our expected REDACTED at the time ofREDACTED,which,based on the low-end of the indicative REDACTED range,exceedsHK$4 billion.SUMMARY 26 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE
290、AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.REDACTED STATISTICSThe statistics in the following table are based on the assumptions that REDACTEDShares will be in issue pursuant to the REDACTED and the REDACTED is not exercised:Base
291、d on anREDACTED ofHK$REDACTEDper REDACTEDBased on anREDACTED ofHK$REDACTEDper REDACTEDREDACTED of our Shares(1)HK$REDACTEDHK$REDACTEDREDACTED of our H Shares(2)HK$REDACTEDHK$REDACTEDREDACTED adjusted consolidatednet tangible assets per Share(3)HK$REDACTEDHK$REDACTEDNotes:(1)The calculation of REDACT
292、ED is based on REDACTED Shares expected to be in issueimmediately upon completion of the REDACTED,assuming the REDACTED is not exercised.(2)The calculation of REDACTED of our H Shares is based on REDACTED H Shares expected to bein issue immediately upon completion of the REDACTED,assuming the REDACT
293、ED is notexercised.(3)The REDACTED adjusted consolidated net tangible assets of our Group attributable to the equityholders of our Company per Share is arrived at after the adjustments referred to in“Appendix II REDACTED Financial Information”and on the basis that REDACTED Shares were in issueassumi
294、ng the REDACTED had taken place on June 30,2023,without taking into account any HShares which may be allotted and issued upon the exercise of the REDACTED,or any Shares whichmay be allotted and issued or repurchased by our Company pursuant to the general mandates.IMPACT OF THE COVID-19 PANDEMICSince
295、 December 2019,a novel strain of COVID-19,has severely impacted China andmany other countries.However,the outbreak of COVID-19 had not had any material adverseimpact on our operations and financial performance during the Track Record Period and up tothe Latest Practicable Date,primarily taking into
296、consideration(i)the fact that during the TrackRecord Period and up to the Latest Practicable Date,there was no cancellation or postponementof contracts/projects because of the COVID-19 pandemic;(ii)the fact that we were able tosecure sufficient and prompt automotive-grade chip supplies during the su
297、pply chain disruptioncaused by the COVID-19;(iii)the fact that we did not experience any material shortage oflabor;and(iv)we experienced significant revenue growth during the Track Record Period.Asof the Latest Practicable Date,we were closely monitoring the development of COVID-19.Fordetails,see“Bu
298、siness Impact of the COVID-19 Pandemic.”SUMMARY 27 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.IMPACT OF THE GLOBAL SHORTAGE OF SEMICONDUCTOR CHIPSHistorically,wehave
299、experienceddifficultyinsecuringsufficientandpromptautomotive-grade power management chip supplies for iDC series and iFC series due todisruptions in supply chains and logistics caused by the COVID-19 outbreak.In addition,dueto the global shortage of semiconductor chips,Mobileye had to source substit
300、ute componentsto maintain a stable supply.In this regard,tripartite product waivers have been entered into in2021 and 2022 among Geely Group,our Company and Mobileye.For details,see“OurCustomers Our Relationship with Geely Group.”Taking into considerations(i)the limitedsales volume of iDC and iFC se
301、ries during the Track Record Period,(ii)the fact that ourbusiness operations were not materially affected by the tripartite product waivers,and(iii)thefact that we implemented various measures and managed to navigate through the challengesposed by the global shortage of semiconductor chips,we had no
302、t experienced significantconstraints on supply chain during the Track Record Period and up to the Latest PracticableDate.We had not experienced significant increases in our procurement costs as a result of theglobal shortage of semiconductor chips,nor had we experienced any material increase in pric
303、esof semiconductor chips or suffered any production suspension due to a disruption in the supplychain during the Track Record Period and up to the Latest Practicable Date.LEGAL PROCEEDINGS AND COMPLIANCEFrom time to time,we may be subject to legal proceedings,investigations and claimsarising in the
304、ordinary course of our business.During the Track Record Period and up to theLatest Practicable Date,(i)we had not been and were not a party to any material legal,arbitralor administrative proceedings,and we were not aware of any pending or threatened legal,arbitral or administrative proceedings agai
305、nst us or our Directors that could,individually or inthe aggregate,have a material adverse effect on our business,financial condition and resultsof operations;(ii)we had not been and were not involved in any material noncomplianceincidents that have led to fines,enforcement actions or other penaltie
306、s that could,individuallyor in the aggregate,have a material adverse effect on our business,financial condition andresults of operations;and(iii)we had not been subject to any material product recall andreturn.For details on our compliance matters,see“Business Legal Proceeding andCompliance.”SUMMARY
307、 28 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.RECENT DEVELOPMENT AND NO MATERIAL ADVERSE CHANGEBusiness DevelopmentDuring the two months ended August 31,2023,the to
308、tal sales volume of SuperVisionTMwas 8,086 units.Furthermore,as of August 31,2023,we have successfully delivered a total of1,864 units of iDC Mid since the commencement of its series production.As of the LatestPracticable Date,we had received six letters of nomination from different OEMs with respec
309、tto our iDC Mid.We expect to incur net loss and increased net operating cash outflow in 2023.For detailsof the reasons for our losses,see“Business Business Sustainability.”Regulatory DevelopmentThe CSRC promulgated the Trial Administrative Measures of Overseas SecuritiesOffering and Listing by Domes
310、tic Companies(境內企業境外發行證券和上市管理試行辦法)(“Overseas Listing Trial Measures”)and five relevant guidelines on February 17,2023,which took effect on March 31,2023.The Overseas Listing Trial Measures comprehensivelyreformed the regulatory regime for overseas offering and listing of PRC domestic companiessecuri
311、ties,either directly or indirectly,into a filing-based system.According to the Overseas Listing Trial Measures,PRC domestic companies that seek tooffer and list securities in overseas markets,either in direct or indirect means,are required tofulfill the filing procedure with the CSRC and report rele
312、vant information.Where an issuersubmits an application for initial public offering to competent overseas regulators,filingapplication with the CSRC shall be submitted within three business days thereafter.As advisedby our PRC Legal Advisors,our REDACTED is a direct overseas REDACTED under theOversea
313、s Listing Trial Measures.See“Regulatory Overview PRC Laws and Regulations Regulations Relating to Overseas Securities Offering and Listing.”We have completed thefiling procedure with,and obtained approval from,the CSRC on May 30,2023.No Material Adverse ChangeOur Directors confirm that,up to the dat
314、e of this document,there has been no materialadverse change in our financial or trading position since June 30,2023(being the date onwhich the latest audited consolidated financial information of our Group was prepared)andthere is no event since June 30,2023 which would materially affect the informa
315、tion shown inour consolidated financial statements included in the Accountants Report set out in AppendixI to this document.SUMMARY 29 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF T
316、HIS DOCUMENT.In this document,unless the context otherwise requires,the following terms shallhave the meanings set out below.Certain technical terms are explained in“Glossary ofTechnical Terms.”“affiliate”with respect to any specified person,any other person,directly or indirectly,controlling or con
317、trolled by orunder direct or indirect common control with suchspecified person“AFRC”the Accounting and Financial Reporting Council of HongKong“Articles of Association”or“Articles”the articles of association of the Company adopted onMarch 23,2023 which will become effective upon theREDACTED and as am
318、ended from time to time,asummary of which is set out in Appendix V to thisdocument“associate(s)”has the meaning ascribed thereto under the Listing Rules“Beijing CHJ”Beijing CHJ Automotive Co.,Ltd.(北京車和家信息技術有限公司),a limited liability company established in thePRC on April 10,2015,which is a consolidat
319、ed affiliatedentity controlled by Li Auto Inc.,and one of ourPre-REDACTED Investors“BIS”the U.S.Bureau of Industry and Security“Board”or“Board of Directors”the board of Directors of our Company“Board of Supervisors”the board of Supervisors of our Company“Business Day”or“business day”any day(other th
320、an a Saturday,Sunday or public holidayin Hong Kong and any day on which tropical cyclonewarning no.8 or above or a black rainstorm warningsignal is hoisted in Hong Kong)on which banks in HongKong are generally open for normal banking businessREDACTEDDEFINITIONS 30 THIS DOCUMENT IS IN DRAFT FORM,INCO
321、MPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.REDACTED“Chairman”chairman of the Board“Changshu iMotion”iMotion Automotive Technology(Changshu)Co.,Ltd.(知行汽車科技(常熟)有限公司),alimitedliabilitycompany established
322、 in the PRC on December 4,2017,and a wholly-owned subsidiary of our CompanyDEFINITIONS 31 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.“Chery”Chery Automobile Co.,Ltd.
323、(奇瑞汽車股份有限公司),anautomotive manufacturing company established in thePRC on January 8,1997,a customer of our Group“China,”“PRC”or the“PeoplesRepublic of China”the Peoples Republic of China,but for the purpose ofthis document and for geographical reference only andexcept where the context requires,refer
324、ences in thisdocument to“China”and the“PRC”do not include HongKong,the Macau Special Administrative Region of thePRC and Taiwan“close associate(s)”has the meaning ascribed thereto under the Listing Rules“Companies Ordinance”the Companies Ordinance(Chapter 622 of the Laws ofHong Kong),as amended,supp
325、lemented or otherwisemodified from time to time“Companies(Winding Up andMiscellaneous Provisions)Ordinance”theCompanies(WindingUpandMiscellaneousProvisions)Ordinance(Chapter 32 of the Laws of HongKong),as amended,supplemented or otherwise modifiedfrom time to time“Company,”“we,”“our,”or“us”iMotion A
326、utomotive Technology(Suzhou)Co.,Ltd.(知行汽車科技(蘇州)股份有限公司),alimitedliabilitycompany established in the PRC on December 27,2016and converted into a joint stock company with limitedliability on December 29,2022“Company Law”or“PRCCompany Law”the Company Law of the PRC(中華人民共和國公司法),as amended,supplemented or
327、 otherwise modifiedfrom time to time“connected person(s)”has the meaning ascribed thereto under the Listing Rules“connected transaction(s)”has the meaning ascribed thereto under the Listing Rules“Controlling Shareholder(s)”has the meaning ascribed to it under the Listing Rules andunless the context
328、otherwise requires,refers to Mr.SONG Yang,Lanchi Platform,Zichi Platform,SuzhouHongchi and Suzhou LuchiDEFINITIONS 32 THIS DOCUMENT IS IN DRAFT FORM,INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUSTBE READ IN CONJUNCTION WITH THE SECTION HEADED“WARNING”ON THE COVER OF THIS DOCUMENT.“Con
329、version of Domestic Sharesinto H Shares”the conversion of 79,487,685 Domestic Shares into HShares on a one-for-one basis upon the completion ofREDACTED.Filing of such conversion of DomesticShares into H shares has been completed with the CSRCon May 30,2023 and an application for H Shares to beREDACT
330、ED on the Stock Exchange has been made tothe Listing Committee“COVID-19”a viral respiratory disease caused by the severe acuterespiratory syndrome coronavirus 2(SARS-CoV-2)“CSDC”China Securities Depository and Clearing Co.,Ltd.(中國證券登記結算有限責任公司)“CSDC(Hong Kong)”China Securities Depository and Clearing
331、(Hong Kong)Co.,Ltd(中國證券登記結算(香港)有限責任公司)“CSRC”China Securities Regulatory Commission(中國證券監督管理委員會),a regulatory body responsible for thesupervision and regulation of the PRC national securitiesmarkets“Data Protection Laws”a variety of local,national and international laws,directives,and regulations tha
332、t apply to the collection,use,retention,protection,security,disclosure,transfer,and other processing of personal data in the differentjurisdictions in which we operate“Denied Persons List”the list of individuals and entities that have been deniedexport privileges,and any dealings with a party on thi
333、slist that would violate the terms of its denial order areprohibited pursuant to Section 764.3(a)(2)of the EAR“Director(s)”the director(s)of our Company,including all executive,non-executive and independent non-executive directors“Domestic Share(s)”ordinary shares in the share capital of our Company,witha nominal value of RMB1.00 each,which are subscribedfor and paid up in Renminbi and are not RED
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