Park Ha Biological Technology (BYAH) Registration Filing summary

Company overview and business model

• Operates as a Cayman Islands holding company with all business activities conducted through PRC subsidiaries focused on skincare and cosmetic products under the “Park Ha” brand in China.

• Revenue streams include product sales and franchise fees, with a franchise model supporting nationwide expansion; as of April 30, 2024, there were 43 franchisees and 2 directly operated stores.

• Product development is led by Park Ha Jiangsu, with R&D collaborations with Jiangnan University; manufacturing is outsourced to third-party suppliers.

• The company leverages digital marketing, social media, and an O2O (online-to-offline) model to drive customer engagement and sales.

Financial performance and metrics

• For the year ended October 31, 2023, revenue was $2.46 million, up 28% from $1.92 million in 2022, primarily due to increased franchise fees.

• Net income for FY2023 was $852,042, a 345% increase from $191,298 in FY2022; gross profit margin improved to 87% from 73% year-over-year.

• For the six months ended April 30, 2024, revenue was $852,928, down 38% from the prior year period, with net income dropping 90% to $48,900, mainly due to a decrease in franchise fees.

• As of April 30, 2024, cash was $931,966, with working capital supported by operating cash flows and equity contributions.

Use of proceeds and capital allocation

• Approximately 50% of IPO proceeds will be used to expand directly owned stores, 20% to purchase product patents, and 30% to acquire ingredient suppliers to reduce production costs.

• Funds raised must be remitted to China before use, which may take several months due to regulatory procedures.