Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 104

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 5
Chunk 104
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) our plan to leverage more content and
social media marketing providers and platforms to drive repeat purchases, an increase in Average Order Value (“ AOV”), and
attract net-new users to our platform, and (iii) improvements in referral rates.

Debt Obligations - our
debt obligations primarily consist of shareholder loans, convertible loans and bank borrowings used to finance our ongoing working capital
requirements. As of December 31, 2024 and December 31, 2023, the outstanding balance on the shareholder loan was RMB84.3 million
(US$11.6 million) and RMB83.1 million respectively. The outstanding balances of convertible loans as of December 31, 2024 and December 31,
2023 were RMB13.6 million (US$1.9 million) and RMB21.4 million, respectively. The outstanding balances of bank borrowings both
in short-term and long-term as of December 31, 2004 and December 31, 2023 were RMB55.8 million (US$7.6 million) and RMB27.0 million, respectively.

Mergers and Acquisitions
(“ M& A”) - M& A is a key growth strategy going forward. We will evaluate and opportunistically execute
strategic joint ventures (JV), potential investments, and acquisition opportunities with a focus on supplementing and/or complementing
our existing products, sales channels, customer-base and/or allow us to optimize our existing supply-chain management capabilities. The
M& A strategy will continue to evolve with our changing needs and requirements. M& A is an important part of our strategy to establish
our footprint and sales channel internationally. We are actively looking at potential targets with revenues in the US, Europe, Australia,
SE Asia, and Middle East. However, historically, virtually all of our sales have been in China. For example, our international (meaning
outside of China) sales was 2.0% in 2023 and accounted for 10.1% of our total revenue for the year ended December 31, 2024. There can
be no assurances that we will be successful in generating revenues internationally. For example, our M& A strategy may not identify
M& A candidates and acquisitions that are completed may not be successfully integrated into our operations and may not produce significant
international revenues. On December 26, 2023, we entered into an agreement to purchase Yai’s