Company: TOP
Filing Date: 2025-08-13
Form Type: 20-F
Source: 0001213900-25-075728
Chunk: 17

Company: TOP Financial Group Ltd
Filing Date: 2025-08-13
Form: 20-F
Item: Item 4A
Chunk 17
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5, 2024 and 2023.

Trading gains from OTC derivative business

In November 2023, we launched OTC derivative
business. We subscribed for 50% of the structured note portfolio. According to the agreements among us and other holders of structured
notes, (i) in the event the portfolio makes gains and declares distribution of dividends from the portfolio, the Company is entitled to
20% of dividends, (ii) in the event the portfolio suffers losses, the other 50% holders of structured notes shall bear the losses until
the net assets of the portfolio reached 65% of total subscription amount, additional deposit call from the other 50% holders may be triggered,
and (iii) in the event the net assets of portfolio is below 55% of subscription amount with no additional deposit being replenish the
portfolio is terminated. We terminated the OTC derivative business in the year of 2025. For the year ended March 31, 2025 and 2024, we
recognized trading gains from OTC derivatives business of US$0.1 million and US$0.1 million, respectively, accounting for 4.4% and 1.5%
of total revenues.

Interest income from loan business

For the year ended March 31, 2024, we launched
the loan business to third party customers. The business was approved by the Hong Kong Licensing Court under the Money Lenders Ordinance.
The Company disbursed loans to customers for a fixed period and charged interests from the customers. The principal and interest are repayable
upon the maturity of the loans. We recognized interest income using straight-line method over loan period. For the year ended March 31,
2025 and 2024, we recognized interest income of US$0.8 million and US$0.2 million from loan business, accounting for 25.0% and 2.9% of
total revenues, respectively.

Other service revenues

Other service revenues represent the revenues
generated from rendering other financial services including securities brokerage, consulting services, and currency exchange services.
We generally receive subscription fees calculated with reference to the amount subscribed by our clients of the structured products. For
the years ended March 31, 2025, 2024 and 2023, other service revenues accounted for 6.9%, 3.5% and 3.0% of total revenues, respectively.

Revenues generated from margin financing accounted
for 4.7%,