Company: FEBO
Filing Date: 2025-05-14
Form Type: 20-F
Source: 0001641172-25-010075
Chunk: 66

Company: Fenbo Holdings Ltd
Filing Date: 2025-05-14
Form: 20-F
Item: Item 4
Chunk 66
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 demand also lies on the heightened reliability and durability of hair styling tool, which in turn serve as an impetus to the
future demand for such product to grow at a CAGR of 9.3% during 2022 to 2026.

Developed
Supply Chain in the PRC. Outlined by the PRC Ministry of Industry and National Development and Reform Commission, the national
electronic manufacturing comprehensive development index that measures the industry’s scale of development, innovation, and efficiency,
has increased considerably from 100.0 to 175.3 from 2016 to 2021, representing a CAGR of approximately 11.9% during 2016 to 2021. As a
major production and export country of electronic products, the supply chain of electronic components in the PRC has been well developed,
where upstream raw material producers and various midstream manufacturers are often located in each other’s proximately, which allows
close collaboration and reduced logistics costs. To attain better allocation of resources and considering cost efficiency, brand owners
around the globe have increasingly outsourced the manufacturing of hair styling products to OEMs. In turn, OEMs are expected to continuously
serve as major stakeholders in the supply chain.

Favorable
Policies in the PRC. In view of the accelerated downstream demand for various electronic product and subsequently the production
volume, the PRC government has devoted substantial efforts and promulgated development directions underpinning the domestic manufacturing
industry, particularly on electronic products. In terms of monetary policy, the PRC government has set out mitigation plans to the reduce
operational costs of electronics manufacturers, through provisions of tax relief and preferential financing assistance. Further, the “ Information
Industry Development Guide” published by the PRC government has placed strong emphasis on research and development of various types
of manufacture red products. As a consequence of the rollout of various technology related proposals prior to the Fourteenth Five-Year
Plan, the PRC Government has taken initiatives in developing innovative technology that accommodates the dynamic environment. In turn,
the demand for hair styling tool OEM services is expected to grow continuously with the support of the favorable PRC government policies.

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Digitalization
in Production and operational Aspects. Owing to the advancement of technology and the implementation of “ Made in
China 2025” production initiatives, increasing numbers of electronic products manufacturers including manufacturers of hair styling
tool are leveraging computerized machineries and advanced machineries to implement automation with an aim to lowering