Company: XHG
Filing Date: 2025-01-22
Form Type: 20-F
Source: 0001213900-25-005499
Chunk: 164

Company: XChange TEC.INC
Filing Date: 2025-01-22
Form: 20-F
Item: Item 11
Chunk 164
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 Renminbi appreciated more than 20% against the U. S. dollar over the following three
years. Between July 2008 and June 2010, this appreciation halted and the exchange rate between the Renminbi and the U. S. dollar remained
within a narrow band. Since June 2010, the PRC government has allowed the Renminbi to appreciate slowly against the U. S. dollar again,
and it has appreciated more than 10% since June 2010. On August 11, 2015, the PBOC announced plans to improve the central parity rate
of the RMB against the U. S. dollar by authorizing market makers to provide parity to the China Foreign Exchange Trading Center operated
by the PBOC with reference to the interbank foreign exchange market closing rate of the previous day, the supply and demand for foreign
currencies as well as changes in exchange rates of major international currencies. Effective from October 1, 2016, the International Monetary
Fund added Renminbi to its Special Drawing Rights currency basket. Such change and additional future changes may increase the volatility
in the trading value of the Renminbi against foreign currencies. The (depreciation) /appreciation of the U. S. dollar against the Renminbi
was approximately 10.4%, 2.7% and (3.8%) in FY 2022, FY 2023 and FY 2024, respectively. The PRC government may adopt further reforms of
its exchange rate system, including making the Renminbi freely convertible in the future. Accordingly, it is difficult to predict how
market forces or PRC or U. S. government policy may impact the exchange rate between Renminbi and the U. S. dollar in the future.

As substantially all of our revenues and expenses
are denominated in Renminbi, we do not believe that we currently have any significant direct foreign exchange risk, and have not used
any derivative financial instruments to hedge exposure to such risk. Although our exposure to foreign exchange risks should be limited
in general, the value of your investment in our ADSs will be affected by the exchange rate between U. S. dollar and Renminbi because the
value of our business is effectively denominated in Renminbi, while our ADSs will be traded in U. S. dollars. In addition, the reporting
currency of our company is Renminbi, the functional currency of our company