HC Group Inc. announced that a court has issued freezing orders on shares in its subsidiary Beijing Panpass held by Beijing Huicong Zaichuang Technology Co., Ltd. (Beijing Zaichuang) after the latter was named as a respondent in a contractual dispute. Key details of the case • Claim amount: RMB126.70 million, covering the alleged repurchase price, breach-of-contract damages and related expenses. • Origin: A share-subscription agreement dated 1 December 2020 under which the claimants now seek a mandatory share repurchase by Beijing Zaichuang. • Litigation status: Preliminary stage; the Group intends to respond and take appropriate actions. Operational exposure Beijing Panpass remains under HC Group’s control. Unaudited figures for the year ended 31 December 2024 show: • Total assets: RMB289.00 million (15.40 % of consolidated assets). • Revenue: RMB178.00 million (1.60 % of consolidated revenue). • Gross profit: RMB95.00 million (23.40 % of consolidated gross profit). Financial implications If the court ultimately upholds the RMB126.70 million claim, HC Group plans to fund any payment from existing resources. Such a payout would reduce cash and cash equivalents—currently about 45 % of consolidated total assets—and lower both consolidated equity attributable to shareholders and raise other financial liabilities. Provisions covering the potential outflow have already been recorded in the Group’s 2024 financial statements and the unaudited 2025 interim results. HC Group advised shareholders and potential investors to exercise caution when dealing in its securities.