Six Months Ended September 30, 2018

Three Months Ended September 30, 2018

SeeThe accompanying notes toare an integral part of these condensed consolidated financial statementsstatements..

LUCKYCOM PHARMACEUTICALS INC.

LUCKWEL PHARMACEUTICALS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

SeeThe accompanying notes toare an integral part of these condensed consolidated financial statements.

LUCKYCOMLUCKWEL PHARMACEUTICALS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(Unaudited)

Note 1 – Organization and Basis of Presentation

The accompanying condensed consolidated unaudited interim financial statements of Luckycom Pharmaceuticals Inc. (the “Company”, “Luckycom”, “we” or “our”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”), and should be read in conjunction with the audited financial statements and notes thereto of the Company contained in the Company’s Form 10-K filed with the SEC on June 27, 2017.

In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year.

Organization and Description of Business

The CompanyLuckwel Pharmaceuticals Inc. (“Luckwel” or the “Company”) plans to acquire, develop, manufacture and market pharmaceutical medication.

Luckycom Limited, a wholly-owned subsidiary of the Company, was incorporated in Hong Kong as Goldsans Capital (Hong Kong) Limited (“Goldsans”) on November 8, 2011. Goldsans name was changed to Wudor Capital Hong Kong Limited on May 22, 2012 and subsequently to Luckycom Limited on June 28, 2013.

On DecemberApril 11, 2018, Luckwel filed a Certificate of Amendment to the Articles of Incorporation to change its name from Luckycom Pharmaceuticals Inc. to Luckwel and to increase the number of its authorized shares of common stock to 200,000,000 with an effective date of April 13, 2017,2018. The Company then amended and restated its by-laws to reflect the new corporate name.

The Company’s corporate office is located in Waltham, Massachusetts and is incorporated in the State of Nevada.

As used in this Quarterly Report on Form 10-Q (“Quarterly Report”), unless otherwise indicated, all references herein to “Luckwel,” the “Company,” “we” or “us” refer to Luckwel Pharmaceuticals Inc.

Note 2 - Summary of Significant Accounting Policies

Preparation of Interim Financial Statements

The accompanying condensed financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America for interim financial information and the Securities and Exchange Commission instructions to Form 10-Q. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the interim period ended September 30, 2019 are not necessarily indicative of the results that can be expected for the full year. The condensed financial statements contained herein should be read in conjunction with the financial statements and notes thereto included in the Company’s sole officer and director, and a shareholder, Mr. Kingrich Lee executed a Sold Note and Instrument of TransferAnnual Report on behalf of Luckycom Pharmaceuticals Inc., pursuant to whichForm 10-K for the year ended March 31, 2019 filed with the SEC on July 2, 2019.

These condensed financial statements have been prepared on the assumption that the Company would sellwill be able to Ms. Lijian Li, Mr. Kingrich Lee’s sister, 10,000 sharesrealize its assets and discharge its liabilities in the normal course of stockbusiness. This assumption is presently uncertain and contingent upon the Company’s ability to raise additional working capital. The financial statements do not include any adjustments relating to recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Basis of Presentation

The financial statements of the Company’s wholly-owned Hong Kong subsidiary, Luckycom Limited at a purchase priceCompany have been prepared in accordance with generally accepted accounting principles in the United States of HKD 1 (approximately $0.13) per share aggregating to HKD 10,000 (approximately $1,281)America (“U.S. GAAP”) and are presented in US dollars (“USD”). On the same date, the transaction was consummated

Cash

Cash includes all cash in bank with the paymentno restrictions. The Company had $4,336 and $25,754 of stamp duty to the Hong Kong tax department.cash as of September 30, 2019 and March 31, 2019, respectively.

LUCKWEL PHARMACEUTICALS INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

(Unaudited)

Note 2 – Summary of Significant Accounting Policies (Continued)

Fair Value of Financial Instruments

Accounting Policies on DisposalStandards Codification (“ASC”) Topic 820,Fair Value Measurement, defines fair value as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of Subsidiaryinput that is available and significant to the fair value measurement. Level 1 inputs are quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 utilizes quoted market prices in markets that are not active, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. Level 3 inputs are unobservable inputs for the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date.

The resultsCompany’s financial instruments consist of disposalcash, accrued liabilities and due to officer. The carrying amount of subsidiary, less applicable income taxes (benefit), is reported as a separate componentthese financial instruments approximate fair value due either to length of income. A gainmaturity or loss recognized on the disposal is presented separately on the face of the statement where net income is reported orinterest rates that approximate prevailing market rates unless otherwise disclosed in the notes tothese financial statements. There were no financial instruments classified as Level 3 in the fair value hierarchy during the three and six months ended September 30, 2019 and September 30, 2018, respectively.

Income Taxes

During the three and six months ended September 30, 2019 and 2018, there was no provision for income taxes as the Company incurred losses during both periods. Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

Uncertain tax positions

The Company accounts for uncertainty in income taxes using a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. Interest and penalties related to uncertain tax positions are recognized and recorded as necessary in the provision for income taxes. Tax years from 2013 forward remain open to examination by the U.S. federal tax authority due to the carryover of net operating losses or tax credits. According to Hong Kong Inland Revenue Department, the statute of limitation is six years if any company chargeable with tax has not been assessed at less than the proper amount. The statute of limitation is extended to 10 years if the underpayment of taxes is due to fraud or willful evasion. There were no uncertain tax positions as of September 30, 2019 and March 31, 2019.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Basic and Diluted Net Loss Per Share

Basic loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted loss per share is calculated by dividing the Company’s net loss available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There were no potentially dilutive debt or equity outstanding as of September 30, 2019 and March 31, 2019, respectively.

Recent Accounting Pronouncements

The Company does not expect the adoption ofbelieve any recently issued but not yet effective accounting pronouncements tostandards, if currently adopted, would have a significant impactmaterial effect on the Company’s resultsfinancial position, statements of operations financial position orand cash flows.

LUCKWEL PHARMACEUTICALS INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

(Unaudited)

Note 23 – Going Concern

The Company does not have any sources of revenues and needs additional cash resources to maintain its operations. The Company has $4,336 in cash and a net working capital deficit of $1,043,724, has incurred losses since inception of $2,943,242, and has not yet received any revenue from sales of products or services. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent on its’ ability to raise additional capital or obtain necessary debt financing. The Company is presently dependent on its’ Chief Executive Officer, Mr. Kingrich Lee to either provide the Company funding for its daily operations and expenses, including professional fees and fees charged by regulators, although he is under no obligation to do so, or to lead the financing efforts with third parties.

The Company currently does not have any arrangements in place to complete any financings and there is no assurance that it will be successful in completing any such financings on terms that will be acceptable.

The Company’s priority, should it receive such additional funds is to pay its’ legal, accounting and its’ filing obligations under United States federal securities laws, as well as to pay its other accounts payable generated in the ordinary course of business.

The financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge itsits’ liabilities in the normal course of business for the foreseeable future. The Company has incurred losses since inception resulting in an accumulated deficit of $1,844,383 as of December 31, 2017, and further losses are anticipated as a result of the development of business which raises substantial doubt about the Company’sits’ ability to continue as a going concern within the next twelve months from the issuance date of this report.the financial statements. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining financing necessary to meet the Company’sits’ obligations and repay itsits’ liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand and loans from directors and/or private placement of the Company’sits’ common stock. However, there will be no assurance that management plan would work. We do not have any formal commitments or arrangements for the sale of stock or the advancement of loans of funds at this time. There can be no assurance that such additional financing will be available to us on acceptable terms, or at all.

LUCKWEL PHARMACEUTICALS INC.

(Unaudited)

Note 34 – Related Party Transactions

The Company’s sole officer and director, and a shareholder, Mr. Kingrich Lee, loaned an aggregate of $24,365$148,600 in cash and $39,388 tomade payments aggregating $36,050 on behalf of the Company during the threesix months ended December 31, 2017 and 2016, respectively, andSeptember 30, 2019. During the comparable period of 2018, he loaned an aggregate of $62,105$264,954 and $190,282 tomade aggregate payments of $148,483 on behalf of the Company during the nine months ended December 31, 2017 and 2016, respectively.Company.

Accordingly, Mr. Kingrich Lee is owed an aggregate amount of $62,105$935,900 and $327,054$751,250 as of December 31, 2017September 30, 2019 and March 31, 2017, respectively.2019, respectively, from the Company.

The amounts are unsecured, non-interest bearing and are due on demand.

DuringOn May 3, 2018, the nine months ended December 31,Company entered into an Intellectual Property Sale and Purchase Agreement (the “Agreement”) with Luckwel Asia Limited (the “Seller”, formerly known as Essential Choice Ventures Ltd), an entity under common control of Mr. Kingrich Lee to purchase from the Seller the intellectual property rights to five drugs, comprising three generic medicines used to treat hypertension and high cholesterol and two advanced drug candidates - KL008 for treatment of hypertension and KL009 for treatment of high cholesterol in various stages of being developed and manufactured (the “Transaction”). Pursuant to the terms of the Agreement, the Company would pay the Seller on closing (i) $40,000 and (ii) issue an aggregate 125,000,000 restricted shares of its common stock, par value $0.01. The Transaction closed on May 3, 2018. The Company recorded the carrying value of the intellectual property as nil in the Seller’s record, $40,000 as capital distribution to the Seller and recorded the par value of the common stock as additional paid-in capital, which was due to the Transaction being regarded as an equity transaction because both parties were under common control.

On November 1, 2017, the Company issuedentered into an aggregateemployment agreement with Mr. Kingrich Lee. The agreement is for one year, renewable for successive one-year terms if not terminated, and provides an annual compensation of 750,000 shares of common stock to$180,000, and other benefits, including housing and education allowances. On November 1, 2018 and November 1, 2019, the Company renewed the employment agreement with Mr. Kingrich Lee in the settlementfor another one-year term. As of the debt owed toSeptember 30, 2019, Mr. Kingrich Lee was owed $54,000 pursuant to his employment agreement which is recorded in the amount of $327,054 and in exchange of Mr. Kingrich Lee’s investment of $422,946 of cash.

On December 13, 2017, Mr. Kingrich Lee sold to Ms. Lijian Li, his sister, 10,000 shares of stock of the Company’s wholly-owned Hong Kong subsidiary, Luckycom Limited at a purchase price of HKD 1 (approximately $0.13) per share aggregating to HKD 10,000 (approximately $1,281).  The disposal loss recorded from the sale was $4,123.accrued expenses.

Note 45 – Capital Stock

As of December 31, 2017,September 30, 2019 and 2018, the Company had 18,376,000143,376,000 shares of common stock issued and outstanding. During the ninesix months ended December 31, 2017,September 30, 2018, the Company issued inan aggregate of 750,000125,000,000 restricted shares of its common stock to Mr. Kingrich Lee.Luckwel Asia Limited.

Note 5 – Disposal of a Subsidiary

On December 13, 2017, Mr. Kingrich Lee, on behalf of the Company, sold 100% of the ownership of Luckycom Limited, a wholly-owned Hong Kong subsidiary, to Ms. Lijian Li for cash proceeds of $1,255 (net of expenses $26). The Company recognized a loss of $4,123, net of Hong Kong subsidiary net assets of $5,378. Simultaneously the Hong Kong subsidiary forgave the $219,653 owed by the Company and transferred the amount due from an officer totaled $17,015 to the Company to offset the aggregate amount due to the same officer.

Note 6 – Subsequent EventEvents

On October 3, 2019, the Company received a private loan of $10,000 from its’ sole officer and director, and a shareholder, Mr. Kingrich Lee. The Company has evaluated subsequent events through the issuance of the condensed consolidated financial statementsloan is non-interest bearing and no subsequent event is identified. due on demand.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. We intend such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of complying with those safe-harbor provisions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Further information concerning our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC.

Overview

We are presently still a shell company and have not begun operations.

As reflected in the accompanying condensed financial statements we have no sourcesources of revenuesrevenue and need additional cash resources to maintain our operations. At September 30, 2019, we have $4,336 in cash and a net working capital deficit of $1,043,724, have incurred losses since inception of $2,943,242, and have not yet received any revenue from sales of products or services. These factors raise substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is dependent on our ability to raise additional capital or obtain necessary debt financing. These factors raise substantial doubt about our ability to continue as a going concern. We are presently dependent on our controlling shareholderChief Executive Officer, Mr. Kingrich Lee, to either provide us funding for ourits daily operationsoperation and expenses, including professional feesfee and fees charged by regulators, although he is under no obligation to do so.so, or to lead the financing efforts with third parties.

We have $129,843 in cash as of December 31, 2017. We believe that our expenses over the next 12 months from the issuance date of this report will be approximately $2,000,000. This estimate may change significantly depending on the nature of our future business activities and our ability to raise capital from shareholders or other sources.

We intend to meet our cash requirements for the next 12 months from the issuance date of this report through a combination of debt and equity financing by way of private placements, friends, family and business associates. As a reporting company, we are better equipped to raise capital because of the transparency of our operations and development. We currently do not have any arrangements in place to complete any private placement financings and there is no assurance that we will be successful in completing any such financings on terms that will be acceptable to us.We anticipate that Mr. Kingrich Lee, our Chief Executive Office, will spearhead our financing efforts.acceptable.

IfOur priority, should we are unablereceive such additional funds, is to raise $2,000,000pay our legal, accounting and other fees associated with our Company and our filing obligations under United States federal securities laws, as well as to implementpay our business plan as anticipated, we will need to scale our business developmentother accounts payable generated in line with available capital. Our primary priority will be to retain our reporting status with the SEC, which means that we will first ensure that we have sufficient capital to cover our expenses, which are estimated to be $300,000 over the next 12 months. ordinary course of business.

Once these costs are accounted for, we will focus on the following activities:

Any failure to raise money will have the effect of delaying the time framestimeframes in our business plan as set forth above, and we may have to push back the dates of such activities.

Results of Operations

The Three Monthsand NineSix Months Ended December 31, 2017September 30, 2019 and 20162018

Operating Revenue

We recorded no consolidated revenue and consolidated gross loss for the three-monththree and nine-month periodssix months ended December 31, 2017September 30, 2019 and the same for the corresponding periods in 2016September 30, 2018, as we are a shell company without any operations to generate revenue. We do not anticipate receiving further revenue for so long as we have no operations.

Operating Expenses

We had operating expenses of $122,806$111,387 and $128,749$159,100 for the three months ended December 31, 2017September 30, 2019 and 2016,2018, respectively, and $388,820$251,902 and $351,677$379,456 for the ninesix months ended December 31, 2017September 30, 2019 and 2016,2018, respectively.

Our operating expenses for the three months ended December 31, 2017September 30, 2019 consisted mainly of officer compensation of $73,327, professional fees of $48,906, officer compensation of $59,624,$29,589, travel expenses of $8,213,$4,156, office operations expenses of $2,706 and rent of $3,481.$1,609. Operating expenses decreased significantly from the comparable prior period because we attended fewer conferences and meetings and spent less on office expenses.

Our operating expenses for the three months endedDecember 31, 2016 September 30, 2018 consisted mainly of officer compensation of $91,713, professional fees of $56,465 (which includes $5,940 stock-based compensation), officer compensation$36,703, office operations expenses of $44,663,$20,234, travel expenses of $12,086,$9,430 and rent of $9,396.

The increase in officer compensation is mainly due to the additional benefits provided in our Chief Executive Officer’s new employment contract; the decrease in travel expenses is mainly due to fewer business trips; the decrease in rent is mainly due to the cancellation of our virtual office services.$1,020.

Our operating expenses for the ninesix months ended December 31, 2017September 30, 2019 consisted mainly of officer compensation of $140,216, professional fees of $175,177, officer compensation of $155,623,$84,406, travel expenses of $22,896, and$17,756, office operations expenses of $4,891, rent of $21,677.$2,860 and other operation expenses of $1,773.

Our operating expenses for thenine six months ended December 31, 2016September 30, 2018 consisted mainly of officer compensation of $145,713, professional fees of $152,644 (which includes $5,940 stock-based compensation), officer compensation$101,414, office operations expenses of $134,659,$97,661, travel expenses of $25,287, and$32,698, rent of $25,506.

The increase in professional fees is mainly due to the upgrading$1,468 and other operation expenses of our accounting and audit services; the increase in officer compensation is mainly due to the increased compensation to our principal officer, Mr. Kingrich Lee.$502.

We anticipate our operating expenses will increase sharplysignificantly as we proceed to implement our business plan described above and become operational.

Net Loss

We incurred a net loss of $126,834$111,387 and $128,737$159,099 for the three months ended December 31, 2017September 30, 2019 and 2016,2018, respectively, and a net loss of $392,656$251,901 and $351,955$379,452 for thenine six months ended December 31, 2017September 30, 2019 and 2016,2018, respectively. We anticipate that we will continue to incur losses unless we are able to achieve some of our goals above.

Liquidity and Capital Resources

As of December 31, 2017,September 30, 2019, we had total$17,469 in current assets, of $144,968 consisting of $129,843$4,336 in cash and $15,125$13,133 in prepaid expensesexpense, and other current assets. As of December 31, 2017, we had current liabilities in the amount of $129,833$1,061,193, consisting of other payable and accrued liabilities of $67,728,$125,293, and $62,105$935,900 due to an officer. We had a net working capital deficit of $1,043,724 as of September 30, 2019.

The table below sets forth selected cash flow data for the periods presented: