Digital China Holdings Ltd. (DC Holdings) has disclosed a RMB365.00 million goodwill impairment for FY 2024, sharply higher than the RMB97.00 million booked a year earlier, according to a supplemental announcement to its 2024 annual report released on 29 May 2026.

The writedown is entirely linked to Zhongnong Xinda, a wholly owned unit of Shenzhen-listed subsidiary Digital China Information Service Group (DCITS) in which DC Holdings holds an indirect 40 % interest. Zhongnong Xinda’s operating revenue fell 65 % year on year to RMB73.29 million in 2024 from RMB211.70 million in 2023, triggering a reassessment of its carrying value.

Key valuation parameters • Methodology: Value-in-use based on discounted cash flow, prepared by Beijing Zhongtonghua Asset Appraisal. • Forecast horizon: Five years, using management-approved projections. • Pre-tax discount rate: 10.81 % (2023: 11.18 %). • Revenue growth assumptions: 5.00 %–36.44 % annually, with the top end reflecting an increase from RMB73.29 million in 2024 to a projected RMB100.00 million in 2025. • Gross profit margin assumptions: 41.28 %–42.08 %, below the 2022–2024 average of 45.98 % and reflecting a slide to 37.69 % in 2024.

Management cited several factors behind Zhongnong Xinda’s deterioration: 1. Intensified competition in geospatial information and property-rights platforms from new entrants such as Guotai Epoint and Beijing ZBX. 2. Budget constraints on financial institutions, curbing adoption of direct bank-agriculture linkage solutions. 3. Funding delays for agricultural big-data and digital-agriculture projects amid tighter local government budgets. 4. Project execution lags—contracts worth RMB163.00 million signed by end-2023 yielded only RMB89.30 million in expected 2024 revenue owing to slower client acceptance.

These operational headwinds pushed up delivery costs and compressed gross margins by 7.30 percentage points year on year.

Despite the current weakness, the valuation assumes a rebound from 2025, supported by a contract backlog and policy tailwinds including the National Smart Agriculture Action Plan (2024-2028) and China’s “No. 1 Document,” both of which emphasize digital agriculture and rural land reforms.

The supplemental announcement states that all other disclosures in DC Holdings’ 2024 annual report remain unchanged. The company reiterates that the goodwill impairment reflects an updated assessment of Zhongnong Xinda’s recoverable amount rather than changes in valuation methodology.