Company: FSTWF
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-044386
Chunk: 75

Company: FST Corp.
Filing Date: 2025-05-15
Form: 20-F
Item: Item 4A
Chunk 75
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 golf
equipment suppliers in Taiwan, the Group is one of few manufacturers in the Taiwanese golf industry which markets products globally under
its proprietary brand (KBS). The Group’s design team caters to the needs of PGA professional players to design and develop the shafts
based on the players’ needs and suggestions. As the Group controls the brand channels, it can enjoy the brand profit with higher
gross profit margin than the other peers engaged in OEM in Taiwan and continue to develop products based on the brand platform to create
business opportunities and improve the competitive strength. The KBS branded shafts have been adopted by well-known PGA professional players
for many years and, therefore, have built considerable brand awareness. The Group provides both OEM products and KBS - branded shafts
to international major manufacturers, such as TaylorMade, Callaway, PXG, and Mizuno, for further assembly. The Group’s KBS brand
has covered multiple sales channels successively and improved consumers’ identification and loyalty toward its products with its
brand. If the Group is not able to maintain the brand value of KBS brand due to a decrease in new product launches, a reduction in the
number of PGA endorsements, or any negative publicity, the Group’s operational results, business and the financial condition may
be materially and adversely affected.

Research and Development Investment

The Group owns the production
technology for iron golf shafts. Meanwhile, the iron golf shafts under its private brands, such as KBS Tour and KBS C-Taper, are widely
favored by professional players and amateur players and, therefore, enjoy considerable publicity in the industry. In recent years,
the Group has extended its product lines based on the KBS brand and successively launched the Hybrid, TGI and TD series carbon fiber club
products, thus making the product lines more complete to satisfy the golf brand customers’ needs for one-stop shopping of various
specifications and functions.

Meanwhile, the Group continues
to enhance its production processes and invest in automated equipment to reduce labor costs and shorten delivery times. In recent years,
the Group has utilized Internet of Things (IoT) technology to collect production data and energy consumption metrics. By integrating the
collection and analysis of equipment and production information, the Group has successfully enhanced production capacity and energy efficiency,
thereby improving overall operational performance.

The Group plans to continue
to invest in research and development to be in a leading position for the next stage of golf shaft competition. However, if the Group’s
investment does not yield