Company: ARBB
Filing Date: 2025-10-31
Form Type: 20-F
Source: 0001213900-25-104705
Chunk: 96

Company: ARB IOT Group Ltd
Filing Date: 2025-10-31
Form: 20-F
Item: Item 11
Chunk 96
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ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Foreign Exchange Risk

All of our revenues and substantially all of our
expenses are denominated in RM. Our exposure to foreign exchange risk primarily relates to cash and cash equivalent denominated in U. S. dollars.
We do not believe that we currently have any significant direct foreign exchange risk and have not used derivative financial instruments
to hedge exposure to such risk. Although our exposure to foreign exchange risks should be limited in general, the value of your investment
in our shares is affected by the exchange rate between U. S. dollar and RM because the value of our business is effectively denominated
in RM, while our shares are traded in U. S. dollars.

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

Interest Rate Risk

Our exposure to interest rate risk primarily relates
to the interest expenses incurred on income generated by excess cash, which is mostly held in interest-bearing bank deposits. Interest-earning
instruments carry a degree of interest rate risk. Fixed rate securities may have their fair market value adversely impacted due to a rise
in interest rates, while floating rate securities may produce less income than expected if interest rates fall. We have not been
exposed to material risks due to changes in interest rates, and we have not used any derivative financial instruments to manage our interest
risk exposure. However, our future interest income may fall short of expectations due to changes in market interest rates.

Inflation

To date, inflation in Malaysia has not materially
impacted our results of operations. According to the Department of Statistics Malaysia Official Portal, the year-over-year percent changes
in the consumer price index for 2022 was increase of 3.4%; and for 2023, increase of 2.4%, and for 2024, increase of 2.0%. Although we
have not been materially affected by inflation in the past, we can provide no assurance that we will not be affected in the future by
higher rates of inflation in Malaysia. For example, certain operating costs and expenses