Company: KPEA
Filing Date: 2025-01-14
Form Type: 10-K
Source: 0001493152-25-002124
Chunk: 446

Company: Kun Peng International Ltd.
Filing Date: 2025-01-14
Form: 10-K
Item: Item 1
Chunk 446
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    Effect of exchange rate fluctuation on cash 
    $-  
    $(10,828) 
    $10,570  
    $(13,115) 
    $(13,345) 
    $(26,718)

25

Our
Business

Overview
of Health Food Market in China

As
reported by Gentleman Marketing Agency (“GMA”), a study from Statista states that, between 2020 and 2025, China’s health
(functional) foods market is projected to expand by 30%, reaching an estimated RMB244 billion (US$34.3 billion) by 2025. This steady
and impressive expansion can only be expected to continue as the demand for health food and dietary supplements is increasing.

The
Hong Kong Trade Development Council (“HKTDC”) published an article on China’s Health Food Market in September 2022,
which stated that changes in age demographics, domestic child policy and lifestyle has driven the growth of the health food market in
the People’s Republic of China.

HKTDC
determined that the average age of the population of China is increasing. It cited statistics from the PRC government that the number
of people aged 65 or above in mainland China reached 200 million in 2021, or 14.2% of its total population. This age group is expected
to increase to 25% of China’s total population by 2030. Currently, the average life expectancy in China is 77.3 years and it is
expected to reach 81.9 years by 2040. HKTDC quoted a study from iiMedia Research which found that the main reason seniors purchase health
food is to follow their doctor’s advice or to get sufficient essential nutrients to improve their overall health. The study shows
that a majority of seniors concentrated on boosting their immunity through health food. Moreover, HKTDC quoted another source that found
that nearly 50% of the middle-aged and senior populations in China are willing to spend 40% of their budgets on personal health.

The
Center for Strategic and International Studies has pointed out that mainland China replaced its legacy one-child policy with a two-child
policy in 2016 and then passed a three-child policy into law in July 2021. HKTDC speculates that the universal implementation of the
three-child policy can be expected to increase demand in the maternal and baby health food markets. According to HKTDC, statistics show
that 94.7%