Company: XXC
Filing Date: 2025-11-18
Form Type: 20-F
Source: 0001213900-25-111691
Chunk: 61

Company: XINXU COPPER INDUSTRY TECHNOLOGY Ltd
Filing Date: 2025-11-18
Form: 20-F
Item: Item 11
Chunk 61
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ITEM 11.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign
Exchange Risk

All
our revenues and substantially all our expenses are denominated in RMB. Our financial information uses RMB as the functional currency
has been translated into U. S. dollars in our consolidated financial statements. 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.

The
value of the RMB against the U. S. dollar and other currencies is affected by, among other things, changes in China’s political
and economic conditions. The PRC government allowed the RMB to appreciate by more than 20% against the U. S. dollar between July 2005
and July 2008. Over the last three years, the U. S. dollar has appreciated against the RMB, rising from approximately 6.7 to a peak
of around 7.35, and has recently stabilized in the 7.11 - 7.13 range. The trend reflects a mix of global economics, China policy,
and easing intervention - moving from relative stability to mild depreciation. With the development of the foreign exchange market
and progress towards interest rate liberalization and Renminbi internationalization, the PRC government may in the future announce further
changes to the exchange rate system and it is difficult to predict whether the Renminbi will appreciate or depreciate significantly in
value against the U. S. dollar in the future. It is also difficult to predict how market forces or PRC or U. S. government policy may impact
the exchange rate between the Renminbi and the U. S. dollar in the future.

To
the extent that we need to convert U. S. dollars into RMB for our operations, appreciation of the RMB against the U. S. dollar
would have an adverse effect on the RMB amount we receive from the conversion. Conversely, if we decide to convert RMB into U. S. dollars,
appreciation of the U. S. dollar against the RMB would have a negative effect on the U. S. dollar amounts available to us.

Market
Risk

Market
risk is the risk of loss arising from adverse changes in market rates and prices. Our market risk exposure is generally limited to those
risks that arise in the normal course of business, as we do not engage in speculative, non-operating transactions,