StarGlory Holdings Company Limited faces heightened regulatory scrutiny after the Hong Kong Stock Exchange’s Listing Division concluded on 4 November 2026 that the group has not met GEM Rule 17.26 requirements for sufficient business operations and assets. The Exchange cited deteriorating scale, persistent losses and financial instability across the restaurant and photovoltaic (PV) trading segments, while indicating that a proposed joint-venture (JV) expansion in Hong Kong may constitute a reverse takeover.

Restaurant operations under pressure • Legacy Hong Kong outlets under the “Italian Tomato” and “Ginza Bairin” brands generated revenue of HK$170.00 million in FY2022 but fell to HK$12.00 million in FY2026, recording segment losses in each of the past four years. The last outlet closed in May 2026. • The remaining restaurant asset is a single Shenzhen outlet acquired in November 2025. For the seven months to 31 July 2026 it reported revenue of RMB3.00 million and a net loss of RMB0.40 million, with negative operating cash flow. • Management now plans to form JVs with an external partner to operate four Hong Kong restaurants. Forecast revenue stands at HK$18.50 million for FY2027 and HK$57.60 million for FY2028, but no binding agreements are in place, key personnel have not been identified and the Exchange questions whether performance achieved under the partner’s ownership can be replicated.

PV products trading remains nascent • Launched in FY2026, the PV trading unit generated HK$3.00 million in revenue. • Revenue forecasts of RMB8.40 million for FY2027 and RMB53.70 million for FY2028 hinge on early-stage supply and product-development arrangements that lack concrete progress, leading the Exchange to question the segment’s scalability and sustainability.

Weak balance sheet and going-concern issues • As at 31 March 2026, StarGlory reported net current liabilities of HK$125.00 million, net liabilities of HK$157.00 million and cash of HK$8.00 million. • Auditors have expressed going-concern doubts since FY2015. Management proposes: – Disposing of a subsidiary responsible for a HK$100.60 million shareholder loan; – Extending HK$33.00 million in convertible bonds; – Securing up to HK$10.00 million in new shareholder financing. Even if executed, the group would remain in a net liability position of approximately HK$33.20 million, leaving operations dependent on continued shareholder support.

Reverse takeover concerns The Exchange found that the scale of the proposed JVs, relative to StarGlory’s diminished operations, could effectively list the new restaurant assets and therefore should be treated as a reverse takeover under GEM Rule 19.06B. Questions remain over whether the target restaurants meet new-listing requirements given their limited financial record and reliance on the proposed JV partner for strategic and operational control.

Next steps The supplemental announcement reiterates that trading arrangements remain unchanged from the 4 November 2026 notice. StarGlory pledges further disclosures on material developments. Shareholders and potential investors are advised to exercise caution when dealing in the company’s securities.