Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Dec. 31, 2020 | Feb. 22, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | ADDENTAX GROUP CORP. | |
Entity Central Index Key | 0001650101 | |
Document Type | 10-Q | |
Document Period End Date | Dec. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 26,093,004 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 356,728 | $ 531,681 |
Accounts receivables, net | 3,024,627 | 4,500,116 |
Inventories | 163,233 | 347,531 |
Other receivables - disposal of subsidiaries | 822,933 | |
Other receivables - other | 203,605 | 231,974 |
Advances to suppliers | 208,324 | 389,940 |
Total current assets | 4,779,450 | 6,001,242 |
NON-CURRENT ASSETS | ||
Plant and equipment, net | 894,388 | 585,019 |
Operating lease right of use asset | 11,604,526 | 1,835,717 |
Total non-current assets | 12,498,914 | 2,420,736 |
TOTAL ASSETS | 17,278,364 | 8,421,978 |
CURRENT LIABILITIES | ||
Short-term loan | 153,172 | 353,114 |
Accounts payable | 1,700,062 | 3,620,583 |
Amount due to related parties | 6,448,905 | 5,429,440 |
Advances from customers | 26,192 | 18,931 |
Accrued expenses and other payables | 411,316 | 230,917 |
Operating lease liability current portion | 3,922,214 | 443,543 |
Total current liabilities | 12,661,861 | 10,096,528 |
NON-CURRENT LIABILITIES | ||
Operating lease liability | 7,682,312 | 1,392,174 |
TOTAL LIABILITIES | 20,344,173 | 11,488,702 |
EQUITY | ||
Common stock ($0.001 par value, 50,000,000 shares authorized, 26,093,004 and 25,346,004 shares issued and outstanding at December 31, 2020 and March 31, 2020, respectively) | 26,093 | 25,346 |
Additional paid-in capital | 3,815,933 | 61,050 |
Retained earnings | (6,804,107) | (3,233,122) |
Statutory reserve | 13,663 | 23,514 |
Accumulated other comprehensive loss | (117,391) | 56,488 |
Total deficit | (3,065,809) | (3,066,724) |
TOTAL LIABILITIES AND EQUITY | $ 17,278,364 | $ 8,421,978 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Dec. 31, 2020 | Mar. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 26,093,004 | 25,346,004 |
Common stock, shares outstanding | 26,093,004 | 25,346,004 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Loss and Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | ||||
REVENUES | $ 3,411,552 | $ 4,027,902 | $ 21,014,064 | $ 8,182,396 |
COST OF REVENUES | (2,950,124) | (3,746,040) | (22,776,087) | (7,221,683) |
GROSS (LOSS) PROFIT | 461,428 | 281,862 | (1,762,023) | 960,713 |
OPERATING EXPENSES | ||||
Selling and marketing | (217,942) | (960) | (376,975) | (11,826) |
General and administrative | (532,012) | (526,194) | (1,454,017) | (1,857,288) |
Total operating expenses | (749,954) | (527,154) | (1,830,992) | (1,869,113) |
LOSS FROM OPERATIONS | (288,526) | (245,292) | (3,593,015) | (908,400) |
Interest income | 87 | 10 | 102 | 58 |
Interest expenses | (631) | (3,974) | (6,586) | (16,304) |
Other income (expense), net | 1,273 | 66 | 62,489 | (10,753) |
LOSS BEFORE INCOME TAX EXPENSE | (287,797) | (249,190) | (3,537,010) | (935,399) |
INCOME TAX EXPENSE | (15,784) | (9,022) | (23,196) | (12,086) |
NET LOSS | (303,581) | (258,212) | (3,560,206) | (947,485) |
Foreign currency translation gain (loss) | (85,728) | (50,440) | (173,879) | 58,715 |
TOTAL COMPREHENSIVE LOSS | $ (389,309) | $ (308,652) | $ (3,734,085) | $ (888,770) |
LOSS PER SHARE | ||||
Basic and diluted | $ (0.01) | $ (0.01) | $ (0.14) | $ (0.04) |
Weighted average number of shares outstanding - Basic and diluted | 25,712,713 | 25,346,004 | 25,712,713 | 25,346,004 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings Unrestricted [Member] | Retained Earnings Statutory Reserve [Member] | Accumulated Other Comprehensive Loss [Member] | Total |
Balance at Mar. 31, 2019 | $ 25,346 | $ 61,050 | $ (2,250,770) | $ 21,779 | $ (34,955) | $ (2,177,550) |
Balance, shares at Mar. 31, 2019 | 25,346,004 | |||||
Foreign currency translation | (1) | 58,716 | 58,715 | |||
Movement of Statutory reserve | (1,735) | 1,735 | ||||
Net loss for the period | (947,485) | (947,485) | ||||
Balance at Dec. 31, 2019 | $ 25,346 | 61,050 | (3,199,991) | 23,514 | 23,761 | (3,066,320) |
Balance, shares at Dec. 31, 2019 | 25,346,004 | |||||
Balance at Sep. 30, 2019 | $ 25,346 | 61,050 | (2,940,044) | 21,779 | 74,201 | (2,757,668) |
Balance, shares at Sep. 30, 2019 | 25,346,004 | |||||
Foreign currency translation | (50,440) | (50,440) | ||||
Movement of Statutory reserve | (1,735) | 1,735 | ||||
Net loss for the period | (258,212) | (258,212) | ||||
Balance at Dec. 31, 2019 | $ 25,346 | 61,050 | (3,199,991) | 23,514 | 23,761 | (3,066,320) |
Balance, shares at Dec. 31, 2019 | 25,346,004 | |||||
Balance at Mar. 31, 2020 | $ 25,346 | 61,050 | (3,233,122) | 23,514 | 56,488 | (3,066,724) |
Balance, shares at Mar. 31, 2020 | 25,346,004 | |||||
Issuance of common stocks | $ 747 | 3,734,253 | 3,735,000 | |||
Issuance of common stocks, shares | 747,000 | |||||
Foreign currency translation | (173,879) | (173,879) | ||||
Movement of Statutory reserve | 20,630 | (10,779) | (9,851) | |||
Net loss for the period | (3,560,206) | (3,560,206) | ||||
Balance at Dec. 31, 2020 | $ 26,093 | 3,815,933 | (6,804,107) | 13,663 | (117,391) | (3,065,809) |
Balance, shares at Dec. 31, 2020 | 26,093,004 | |||||
Balance at Sep. 30, 2020 | $ 26,093 | 3,795,303 | (6,489,747) | 23,514 | (31,663) | (2,676,500) |
Balance, shares at Sep. 30, 2020 | 25,346,004 | |||||
Foreign currency translation | (85,728) | (85,728) | ||||
Movement of Statutory reserve | 20,630 | (10,779) | (9,851) | |||
Net loss for the period | (303,581) | (303,581) | ||||
Balance at Dec. 31, 2020 | $ 26,093 | $ 3,815,933 | $ (6,804,107) | $ 13,663 | $ (117,391) | $ (3,065,809) |
Balance, shares at Dec. 31, 2020 | 26,093,004 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (3,560,206) | $ (947,485) |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation | 83,210 | 84,277 |
Loss on disposal of plant and equipment | 1,472 | 3,323 |
Changes in operating assets and liabilities, net of effects from disposal of subsidiaries: | ||
Accounts receivable | 1,367,371 | (1,880,493) |
Inventories | 174,487 | (924) |
Advances to suppliers | (320,771) | (252,620) |
Other receivables | (65,150) | (80,870) |
Accounts payables | (1,688,272) | 1,661,429 |
Accrued expenses and other payables | 173,582 | 373,429 |
Advances from customers | 52,161 | (19,002) |
Net cash provided by (used in) operating activities | (3,782,116) | (1,058,936) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of plant and equipment | (392,108) | (94,864) |
Proceeds from sale of property and equipment | 2,243 | |
Cash decreased in disposal of subsidiaries | (704,479) | |
Net cash used in investing activities | (1,094,344) | (94,864) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stocks | 3,735,000 | |
Proceeds from related party borrowings | 7,697,827 | 1,828,042 |
Repayment of related party borrowings | (6,605,044) | (665,323) |
Proceeds from bank borrowings | 86,886 | 515,816 |
Repayment of bank borrowings | (196,456) | (372,135) |
Net cash provided by financing activities | 4,718,213 | 1,306,400 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | (158,247) | 152,600 |
Effect of exchange rate changes on cash and cash equivalents | (16,706) | (5,843) |
Cash and cash equivalents, beginning of the period | 531,681 | 277,264 |
CASH AND CASH EQUIVALENTS, END OF THE PERIOD | 356,728 | 424,021 |
Supplemental disclosure of cash flow information: | ||
Cash paid during the year for interest | 4,523 | 11,244 |
Cash paid during the year for income tax | 23,196 | 12,086 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Right-of-use assets obtained in exchange for operating lease obligations | 10,404,962 | 1,966,535 |
Net assets of subsidiaries disposed of recorded as Other Receivables | $ 118,454 |
Organization and Business Acqui
Organization and Business Acquisitions | 9 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business Acquisitions | 1. ORGANIZATION AND BUSINESS ACQUISITIONS ATXG and its subsidiaries (the “Company”) are engaged in the business of garments manufacturing, providing logistic services, property leasing and management service in the People’s Republic of China (“PRC” or “China”) and epidemic prevention supplies manufacturing and distribution both in China and overseas markets |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | 2. BASIS OF PRESENTATION In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. All significant intercompany transactions and balances are eliminated in consolidation. However, the results of operations included in such financial statements may not necessary be indicative of annual results. The Company uses the same accounting policies in preparing quarterly and annual financial statements. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2020 filed with the Securities and Exchange Commission (“SEC”) on June 29, 2020 (“2020 Form 10-K.”) and Form S-1/A filed with SEC on January 22, 2021. GOING CONCERN UNCERTAINTY The accompanying unaudited condensed consolidated financial statements are presented on the basis that the Company is a going concern. The going concern assumption contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company incurred net loss of $303,581 and $258,212 for the three months ended December 31, 2020 and 2019, respectively, and $3,560,206 and $947,485 for the nine months ended December 31, 2020 and 2019, respectively. As of December 31, 2020 and March 31, 2020, the Company had net current liability of $7,882,411 and $4,095,286, respectively, and a deficit on total equity of $3,065,809 and $3,066,724, respectively. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company’s profit generating operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they become due. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company expects to finance operations primarily through cash flow from revenue and capital contributions from the CEO. During the year, the CEO has provided financial support for the operations of the Company. In the event that the Company requires additional funding to finance the growth of the Company’s current and expected future operations as well as to achieve our strategic objectives, the CEO has indicated the intent and ability to provide additional equity financing. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of the consolidated financial statements in conformity with US GAAP 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 of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made; however actual results could differ materially from those estimates. There is no change on the accounting policies from the year ended March 31, 2020. Recently issued accounting pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. This standard requires a financial asset (or group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. This standard will be effective for the Company on April 1, 2023. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statements. The Company reviews new accounting standards as issued. Management has not identified any other new standards that it believes will have a significant impact on the Company’s consolidated financial statements. |
Risks and Uncertainties
Risks and Uncertainties | 9 Months Ended |
Dec. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
Risks and Uncertainties | 4. RISKS AND UNCERTAINTIES (a) Economic and Political Risks The Company’s operations are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC economy. The Company’s operations in the PRC are subject to special considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation. (b) Foreign Currency Translation The Company’s reporting currency is the U.S. dollar. The functional currency of the parent company is the U.S. dollar and the functional currency of the Company’s operating subsidiaries is the Chinese Renminbi (“RMB”). For the subsidiaries whose functional currencies are the RMB, all assets and liabilities are translated at exchange rates at the balance sheet date and revenue and expenses are translated at the average yearly exchange rates and equity is translated at historical exchange rates. Any translation adjustments resulting are not included in determining net income but are included in foreign exchange adjustments to other comprehensive loss, a component of equity. (c) Concentration Risks The followings are the percentages of accounts receivable balance of the top five customers over accounts receivable for each segment as of December 31, 2020 and March 31, 2020. Garment manufacturing segment December 31, 2020 March 31, 2020 Customer A 97.2 % 85.5 % Customer B 2.7 % Nil % The high concentration as of March 31, 2020 was mainly due to business development of a large distributor of garments. Management believes that should the Company lose any one of its major customers, it was able to sell similar products to other customers. Logistics services segment December 31, 2020 March 31, 2020 Customer A 24.9 % 22.4 % Customer B 13.0 % 0.0 % Customer C 11.4 % 18.3 % Customer D 10.0 % 0.6 % Customer E 7.6 % 2.4 % Epidemic prevention supplies segment No accounts receivables in this segment. For the three months ended December 31, 2020, one customer from garment segment provided more than 10% of total revenue of the Company, represented 62.8% of total revenue of the Company for the three months. For the nine months ended December 31, 2020, two customers provided more than 10% of our total revenue, with one from garments segment and the other one from epidemic prevention supplies segment, represented 14.0% and 49.6% of total revenue of the Company for the nine months, respectively. The high concentration in three and nine months ended December 31, 2020 was mainly due to concentration of distributors in trading of epidemic prevention supplies. Management believes that should the Company lose any one of its major customers, it was able to sell similar products to other customers. The following tables summarized the purchases from five largest suppliers of each of the reportable segment for the three and nine months ended December 31, 2020 and 2019. Three months ended Nine months ended December 31, December 31, 2020 2019 2020 2019 Garment manufacturing segment 100.0 % 98.7 % 97.7 % 91.2 % Logistics services segment 79.1 % 90.4 % 99.7 % 69.0 % Property management and subleasing 100.0 % - % 100.0 % - % Epidemic prevention supplies 100.0 % - % 100.0 % - % Management believes that should the Company lose any one of its major suppliers, other suppliers are available that could provide similar products to the Company. (d) Interest Rate Risk The Company’s exposure to interest rate risk primarily relates to the interest expenses on our outstanding bank borrowings and the interest income generated by cash invested in cash deposits and liquid investments. As of December 31, 2020, the total outstanding borrowings amounted to $153,172 (RMB1,000,000) with various interest rate from 4.84% to 6.96% p.a. (Note 10) (e) COVID-19 The Coronavirus Disease (COVID-19) outbreak and the measures taken to contain the spread of the pandemic have created a high level of uncertainty to global economic prospects and this has impacted the Company’s operations and its financial performance in the last three quarters of the financial year and subsequent to the financial year end. As the situation continues to evolve with significant level of uncertainty, the Company is unable to reasonably estimate the full financial impact of the COVID-19 outbreak. The Company is monitoring the situation closely and to mitigate the financial impact, it is conscientiously managing its cost by adopting an operating cost reduction strategy and conserving liquidity by working with major creditors to align repayment obligations with receivable collections. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 5. RELATED PARTY TRANSACTIONS Name of Related Parties Relationship with the Company Zhida Hong President, CEO, and a director of the Company Zhongpeng Chen A legal representative of HPF, became not a related party when HPF was disposed of in November, 2020 Bihua Yang A legal representative of XKJ Dewu Huang A legal representative of DT Jinlong Huang A spouse of legal representative of HSW The Company leases Shenzhen XKJ office rent-free from Bihua Yang. In September, the Company disposed of $114,229 aged inventories in HSW to Mr. Jinlong Huang at cost with no gain or loss recognized. The Company had the following related party balances as of December 31, 2020 and March 31, 2020: Related parties borrowings December 31, 2020 March 31, 2020 Zhida Hong $ 5,698,498 $ 5,043,489 Bihua Yang 244,094 - Dewu Huang 379,253 81,287 Zhongpeng Chen - 160,427 Jinlong Huang 127,060 144,237 $ 6,448,905 $ 5,429,440 The borrowing balances with related parties are unsecured, non-interest bearing and repayable on demand. |
Inventories
Inventories | 9 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | 6. INVENTORIES Inventories consist of the following as of December 31, 2020 and March 31, 2020: December 31, 2020 March 31, 2020 Raw materials $ 122,354 $ 230,742 Work in progress 11,745 62,150 Finished goods 29,134 54,639 Total inventories $ 163,233 $ 347,531 There is no inventory write-off for the three and nine months ended December 31, 2020 and 2019. |
Advances to Suppliers
Advances to Suppliers | 9 Months Ended |
Dec. 31, 2020 | |
Advances To Suppliers | |
Advances to Suppliers | 7. ADVANCES TO SUPPLIERS The Company has made advances to third-party suppliers in advance of receiving inventory parts. These advances are generally made to expedite the delivery of required inventory when needed and to help to ensure priority and preferential pricing on such inventory. The amounts advanced to suppliers are fully refundable on demand. The Company reviews a supplier’s credit history and background information before advancing a payment. If the financial condition of its suppliers were to deteriorate, resulting in an impairment of their ability to deliver goods or provide services, the Company would recognize bad debt expense in the period they are considered unlikely to be collected. |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property Plant and Equipment | 8. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consists of the following as of December 31, 2020 and March 31, 2020: December 31, 2020 March 31, 2020 Production plant $ 84,685 $ 67,247 Motor vehicles 1,228,746 868,743 Office equipment 23,243 19,471 1,336,674 955,461 Less: accumulated depreciation (442,286 ) (370,442 ) Plant and equipment, net $ 894,388 $ 585,019 During the nine months ended December 31, 2020, the Company acquired two production lines amounted to $54,327 to manufacture masks for the epidemic prevention supplies business and seven new motor truckers amounted to $315,920 for the logistic service business. During the period, the Company disposed of old machinery with original cost of $19,303 and accumulated depreciation of $18,661, and two old motor truckers with original cost of $22,505 and accumulated depreciation of $15,791. The Company also replaced a few small items of old machinery and office equipment. Depreciation expense for the three and nine months ended December 31, 2020 and 2019 was $32,051 and $27,648, $83,210 and $84,277, respectively. |
Short-term Bank Loan
Short-term Bank Loan | 9 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Short-term Bank Loan | 9. SHORT-TERM BANK LOAN In September 2018, HSW, a subsidiary of the Company entered into a facility agreement with Dongguan Agricultural Commercial Bank and obtained a line of credit, which allows the Company to borrow up to approximately $212,334 (RMB1,500,000) for daily operations with fixed interest rate of 6.96% per annum. The loans are guaranteed at no cost by legal representative of HSW. In September 2020, the Company fully repaid the outstanding loan and this line of credit was cancelled (March 31, 2020: $211,868). In August 2019, HSW entered into a facility agreement with Agricultural Bank of China and obtained a line of credit, which allows the Company to borrow up to approximately $153,172 (RMB1,000,000) for daily operations. The loans are guaranteed at no cost by the legal representative of HSW. As of December 31, 2020, the Company has borrowed $153,172 (RMB1,000,000) (March 31, 2020: $141,246) under this line of credit with various annual interest rates from 4.84% to 4.9%. The outstanding loan balance will be due on March 31, 2021. In August 2020, DT entered into a new facility agreement with Webank and obtained a credit facility of $88,358 (RMB600,000) for daily operations with various annual interest rate from 16.2% to 16.29%. The loans are guaranteed at no cost by the legal representative of DT. The loan borrowing was $86,886 (RMB590,000) as of September 30, 2020 (March 31, 2020: Nil). The loan was transferred to the buyer with the disposal of DT on September 30, 2020. |
Income Taxes
Income Taxes | 9 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10. INCOME TAXES (a) Enterprise Income Tax (“EIT”) The Company operates in the PRC and files tax returns in the PRC jurisdictions. Yingxi Industrial Chain Group Co., Ltd was incorporated in the Republic of Seychelles and, under the current laws of the British Virgin Islands, is not subject to income taxes. Yingxi HK was incorporated in Hong Kong and is subject to Hong Kong income tax at a progressive rate of 16.5%. No provision for income taxes in Hong Kong has been made as Yingxi HK had no taxable income for the three and nine months ended December 31, 2020 and 2019. YX were incorporated in the PRC and is subject to the EIT tax rate of 25%. No provision for income taxes in the PRC has been made as YX had no taxable income for the three and nine months ended December 31, 2020 and 2019. The Company is governed by the Income Tax Laws of the PRC. All Yingxi’s operating companies were subject to progressive EIT rates from 5% to 15% in 2020 and 2019. The preferential tax rate will be expired at end of year 2022 and the EIT rate will be 25% from year 2023. The Company’s parent entity, Addentax Group Corp. is an U.S entity and is subject to the United States federal income tax. No provision for income taxes in the United States has been made as Addentax Group Corp. had no United States taxable income for the three and nine months ended December 31, 2020 and 2019. The reconciliation of income taxes computed at the PRC statutory tax rate applicable to the PRC, to income tax expenses are as follows: Three months ended Nine months ended December 31, December 31, 2020 2019 2020 2019 PRC statutory tax rate 25 % 25 % 25 % 25 % Computed expected benefits (71,949 ) (62,297 ) (884,253 ) (233,850 ) Temporary differences 29,440 22,942 629,954 32,028 Permanent difference 6,640 - 131,595 - Changes in valuation allowance 51,653 48,377 145,900 213,908 Income tax expense $ 15,784 $ 9,022 $ 23,196 $ 12, 086 (b) Value Added Tax (“VAT”) In accordance with the relevant taxation laws in the PRC, the normal VAT rate for domestic sales is 13%, which is levied on the invoiced value of sales and is payable by the purchaser. The subsidiaries HSW, DT and YS enjoyed preferential VAT rate of 13%. The Companies are required to remit the VAT they collect to the tax authority. A credit is available whereby VAT paid on purchases can be used to offset the VAT due on sales. For services, the applicable VAT rate is 9% under the relevant tax category for logistic company, except the branch of HPF enjoyed the preferential VAT rate of 3% in 2020 and 2019. The Company is required to pay the full amount of VAT calculated at the applicable VAT rate of the invoiced value of sales as required. A credit is available whereby VAT paid on gasoline and toll charges can be used to offset the VAT due on service income. |
Consolidated Segment Data
Consolidated Segment Data | 9 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Consolidated Segment Data | 11. CONSOLIDATED SEGMENT DATA Segment information is consistent with how chief operating decision maker reviews the businesses, makes investing and resource allocation decisions and assesses operating performance. The segment data presented reflects this segment structure. The Company reports financial and operating information in the following four segments: (a) Garment manufacturing (b) Logistics services (c) Epidemic prevention supplies (d) Property management and subleasing. The Company also provides general corporate services to its segments and these costs are reported as “Corporate and others”. Selected information in the segment structure is presented in the following tables: Revenues by segment for the three and nine months ended December 31, 2020 and 2019 are as follows: Three months ended Nine months ended Revenues 2020 2019 2020 2019 Garments manufacturing segment $ 2,287,981 $ 2,643,560 $ 5,186,042 $ 3,517,009 Logistics services segment 824,025 1,384,342 3,664,409 4,665,387 Property management and subleasing 294,759 - 294,759 - Epidemic prevention supplies segment 4,787 - 11,868,854 - Total of reportable segments and consolidated revenue $ 3,411,552 $ 4,027,902 $ 21,014,064 $ 8,182,396 Income from operations by segment for the three and nine months ended December 31, 2020 and 2019 are as follows: Three months ended Nine months ended December 31, December 31, 2020 2019 2020 2019 Garment manufacturing segment $ 98,905 $ 158,268 ) $ 240,423 $ 187,803 Logistics services segment 57,222 (176,350 ) 92,506 (168,634 ) Property management and subleasing 5,966 - 5,966 - Epidemic prevention supplies (201,147 ) - (3,297,265 ) - Total of reportable segments (39,054 ) (18,082 ) (2,958,370 ) 19,169 Reconciliation – Corporate (249,472 ) (227,210 ) (634,645 ) (927,569 ) Total consolidated loss from operations $ (288,526 ) $ (245,292 ) $ (3,593,015 ) $ (908,400 ) Total assets by segment as at December 31, 2020 and March 31, 2020 are as follows: Total assets December 31, 2020 March 31, 2020 Garment manufacturing segment $ 2,628,877 $ 4,098,758 Logistics services segment 1,877,949 2,422,140 Property management and subleasing 9,993,744 - Epidemic prevention supplies 243,075 - Total of reportable segments 14,743,645 6,520,898 Reconciliation – Corporate 2,534,719 1,901,080 Consolidated total assets $ 17,278,364 $ 8,421,978 |
Accrued Expenses and Other Paya
Accrued Expenses and Other Payables | 9 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Payables | 12. ACCRUED EXPENSES AND OTHER PAYABLES Accrued expenses and other payables consist of the following as of December 31, 2020 and March 31, 2020: December 31, 2020 March 31, 2020 Accrued wages and welfare 58,874 61,776 Other tax payable 51,387 25,206 Rental payable 52,833 24,972 Customers’ deposits 210,785 - Other payables 37,437 118,963 $ 411,316 $ 230,917 |
Lease Right-of-Use Asset and Le
Lease Right-of-Use Asset and Lease Liabilities | 9 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Lease Right-of-Use Asset and Lease Liabilities | 13. LEASE RIGHT-OF-USE ASSET AND LEASE LIABILITIES The Company implemented new accounting policy according to the ASC 842, Leases, on April 1, 2019 on a modified retrospective basis and did not restate comparative periods. Under the new policy, the Company recognized approximately $0.06 million lease liability as well as right-of-use asset for all leases (with the exception of short-term leases) at the commencement date. Lease liabilities are measured at present value of the sum of remaining rental payments as of December 31, 2020, with discounted rate of 4.35%. A single lease cost is recognized over the lease term on a generally straight-line basis. All cash payments of operating lease cost are classified within operating activities in the statement of cash flows. The Company leases its head office. The lease period is 5 years with an option to extend the lease. The Company leases its plant and dormitory for 4.5 years with an option to extend the lease. The Company leased several floors in a commercial building for its sublease business for 3 years with an option to extend the lease. The Following table summarizes the components of lease expense: Three months ended Nine months ended 2020 2019 2020 2019 Operating lease cost 444,162 126,053 668,883 325,664 Short-term lease cost - 6,445 - 70,231 $ 444,162 $ 132,498 668,883 395,895 The following table summarizes supplemental information related to leases: Three months ended Nine months ended 2020 2019 2020 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flow from operating leases $ 444,162 $ 132,498 $ 668,883 $ 395,895 Right-of-use assets obtained in exchange for new operating leases liabilities 10,378,042 65,527 10,404,962 1,966,535 Weighted average remaining lease term - Operating leases (years) 3.1 4.5 3.1 4.5 Weighted average discount rate - Operating leases 4.35 % 4.35 % 4.35 % 4.35 % The following table summarizes the maturity of operating lease liabilities: Years ending December 31 Lease cost 2021 $ 4,092,830 2022 4,107,892 2023 4,145,246 2024 310,197 Total lease payments 12,656,165 Less: Interest (1,051,639 ) Total $ 11,604,526 |
Share Capital
Share Capital | 9 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Share Capital | 14. SHARE CAPITAL In August 2020, the Company offered 747,000 common stocks to an individual investor. The subscription price was $5.00 per share. The proceeds were all received in August 2020. |
Disposition of Subsidiaries
Disposition of Subsidiaries | 9 Months Ended |
Dec. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposition of Subsidiaries | 15. DISPOSITION OF SUBSIDIARIES The Company sold its subsidiary DT, a manufacturing company in garment manufacturing segment on October 1 to a third party and sold HPF, a subsidiary in logistics services segment in November 2020 to another third party. After disposition, the two subsidiaries became third parties to the Company. The Company will not have any businesses with the two subsidiaries nor the buyers. The business operations, customers and suppliers of DT and HPF were retained by the Company; therefore, the disposition of the two subsidiaries did not qualify as discontinued operations. Financial position of the entities at disposal date and gain or loss on disposal: Garment Manufacturing Segment Financial position of DT September 30, 2020, date of disposal Current assets $ 675,515 Noncurrent assets - Current liabilities (70,742 ) Net assets $ 604,773 The consideration was at the fair value as of date of disposal, which was also the carrying value of DT, resulting no gain or loss recognized on the disposal. Logistics Services Segment Financial position of HPF November 16, 2020, date of disposal Current assets $ 742,798 Noncurrent assets 42,816 Current liabilities (567,454 ) Net assets $ 218,160 The consideration was at the fair value as of date of disposal, which was also the carrying value of HPF, resulting no gain or loss recognized on the disposal. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with US GAAP 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 of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made; however actual results could differ materially from those estimates. There is no change on the accounting policies from the year ended March 31, 2020. |
Recently issued accounting pronouncements | Recently issued accounting pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. This standard requires a financial asset (or group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. This standard will be effective for the Company on April 1, 2023. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statements. The Company reviews new accounting standards as issued. Management has not identified any other new standards that it believes will have a significant impact on the Company’s consolidated financial statements. |
Risks and Uncertainties (Tables
Risks and Uncertainties (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
Schedule of Concentration of Risk by Customers | The followings are the percentages of accounts receivable balance of the top five customers over accounts receivable for each segment as of December 31, 2020 and March 31, 2020. Garment manufacturing segment December 31, 2020 March 31, 2020 Customer A 97.2 % 85.5 % Customer B 2.7 % Nil % The high concentration as of March 31, 2020 was mainly due to business development of a large distributor of garments. Management believes that should the Company lose any one of its major customers, it was able to sell similar products to other customers. Logistics services segment December 31, 2020 March 31, 2020 Customer A 24.9 % 22.4 % Customer B 13.0 % 0.0 % Customer C 11.4 % 18.3 % Customer D 10.0 % 0.6 % Customer E 7.6 % 2.4 % |
Schedule of Inventory Purchases from Suppliers | The following tables summarized the purchases from five largest suppliers of each of the reportable segment for the three and nine months ended December 31, 2020 and 2019. Three months ended Nine months ended December 31, December 31, 2020 2019 2020 2019 Garment manufacturing segment 100.0 % 98.7 % 97.7 % 91.2 % Logistics services segment 79.1 % 90.4 % 99.7 % 69.0 % Property management and subleasing 100.0 % - % 100.0 % - % Epidemic prevention supplies 100.0 % - % 100.0 % - % |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Schedule of Related Parties | Name of Related Parties Relationship with the Company Zhida Hong President, CEO, and a director of the Company Zhongpeng Chen A legal representative of HPF, became not a related party when HPF was disposed of in November, 2020 Bihua Yang A legal representative of XKJ Dewu Huang A legal representative of DT Jinlong Huang A spouse of legal representative of HSW |
Schedule of Related Parties Transactions | The Company had the following related party balances as of December 31, 2020 and March 31, 2020: Related parties borrowings December 31, 2020 March 31, 2020 Zhida Hong $ 5,698,498 $ 5,043,489 Bihua Yang 244,094 - Dewu Huang 379,253 81,287 Zhongpeng Chen - 160,427 Jinlong Huang 127,060 144,237 $ 6,448,905 $ 5,429,440 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following as of December 31, 2020 and March 31, 2020: December 31, 2020 March 31, 2020 Raw materials $ 122,354 $ 230,742 Work in progress 11,745 62,150 Finished goods 29,134 54,639 Total inventories $ 163,233 $ 347,531 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment consists of the following as of December 31, 2020 and March 31, 2020: December 31, 2020 March 31, 2020 Production plant $ 84,685 $ 67,247 Motor vehicles 1,228,746 868,743 Office equipment 23,243 19,471 1,336,674 955,461 Less: accumulated depreciation (442,286 ) (370,442 ) Plant and equipment, net $ 894,388 $ 585,019 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Reconciliation of Income Taxes | The reconciliation of income taxes computed at the PRC statutory tax rate applicable to the PRC, to income tax expenses are as follows: Three months ended Nine months ended December 31, December 31, 2020 2019 2020 2019 PRC statutory tax rate 25 % 25 % 25 % 25 % Computed expected benefits (71,949 ) (62,297 ) (884,253 ) (233,850 ) Temporary differences 29,440 22,942 629,954 32,028 Permanent difference 6,640 - 131,595 - Changes in valuation allowance 51,653 48,377 145,900 213,908 Income tax expense $ 15,784 $ 9,022 $ 23,196 $ 12, 086 |
Consolidated Segment Data (Tabl
Consolidated Segment Data (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Revenues by segment for the three and nine months ended December 31, 2020 and 2019 are as follows: Three months ended Nine months ended Revenues 2020 2019 2020 2019 Garments manufacturing segment $ 2,287,981 $ 2,643,560 $ 5,186,042 $ 3,517,009 Logistics services segment 824,025 1,384,342 3,664,409 4,665,387 Property management and subleasing 294,759 - 294,759 - Epidemic prevention supplies segment 4,787 - 11,868,854 - Total of reportable segments and consolidated revenue $ 3,411,552 $ 4,027,902 $ 21,014,064 $ 8,182,396 Income from operations by segment for the three and nine months ended December 31, 2020 and 2019 are as follows: Three months ended Nine months ended December 31, December 31, 2020 2019 2020 2019 Garment manufacturing segment $ 98,905 $ 158,268 ) $ 240,423 $ 187,803 Logistics services segment 57,222 (176,350 ) 92,506 (168,634 ) Property management and subleasing 5,966 - 5,966 - Epidemic prevention supplies (201,147 ) - (3,297,265 ) - Total of reportable segments (39,054 ) (18,082 ) (2,958,370 ) 19,169 Reconciliation – Corporate (249,472 ) (227,210 ) (634,645 ) (927,569 ) Total consolidated loss from operations $ (288,526 ) $ (245,292 ) $ (3,593,015 ) $ (908,400 ) Total assets by segment as at December 31, 2020 and March 31, 2020 are as follows: Total assets December 31, 2020 March 31, 2020 Garment manufacturing segment $ 2,628,877 $ 4,098,758 Logistics services segment 1,877,949 2,422,140 Property management and subleasing 9,993,744 - Epidemic prevention supplies 243,075 - Total of reportable segments 14,743,645 6,520,898 Reconciliation – Corporate 2,534,719 1,901,080 Consolidated total assets $ 17,278,364 $ 8,421,978 |
Accrued Expenses and Other Pa_2
Accrued Expenses and Other Payables (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Payables | Accrued expenses and other payables consist of the following as of December 31, 2020 and March 31, 2020: December 31, 2020 March 31, 2020 Accrued wages and welfare 58,874 61,776 Other tax payable 51,387 25,206 Rental payable 52,833 24,972 Customers’ deposits 210,785 - Other payables 37,437 118,963 $ 411,316 $ 230,917 |
Lease Right-of-Use Asset and _2
Lease Right-of-Use Asset and Lease Liabilities (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of Components of Lease Expense | The Following table summarizes the components of lease expense: Three months ended Nine months ended 2020 2019 2020 2019 Operating lease cost 444,162 126,053 668,883 325,664 Short-term lease cost - 6,445 - 70,231 $ 444,162 $ 132,498 668,883 395,895 |
Schedule of Supplemental Information for Right-of Use Asset and Lease Liabilities | The following table summarizes supplemental information related to leases: Three months ended Nine months ended 2020 2019 2020 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flow from operating leases $ 444,162 $ 132,498 $ 668,883 $ 395,895 Right-of-use assets obtained in exchange for new operating leases liabilities 10,378,042 65,527 10,404,962 1,966,535 Weighted average remaining lease term - Operating leases (years) 3.1 4.5 3.1 4.5 Weighted average discount rate - Operating leases 4.35 % 4.35 % 4.35 % 4.35 % |
Summary of Maturity of Operating Lease Liabilities | The following table summarizes the maturity of operating lease liabilities: Years ending December 31 Lease cost 2021 $ 4,092,830 2022 4,107,892 2023 4,145,246 2024 310,197 Total lease payments 12,656,165 Less: Interest (1,051,639 ) Total $ 11,604,526 |
Disposition of Subsidiaries (Ta
Disposition of Subsidiaries (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Disposition Of Subsidiaries | |
Summary of Financial Position of Entities and Gain or Loss on Disposal | Financial position of the entities at disposal date and gain or loss on disposal: Garment Manufacturing Segment Financial position of DT September 30, 2020, date of disposal Current assets $ 675,515 Noncurrent assets - Current liabilities (70,742 ) Net assets $ 604,773 The consideration was at the fair value as of date of disposal, which was also the carrying value of DT, resulting no gain or loss recognized on the disposal. Logistics Services Segment Financial position of HPF November 16, 2020, date of disposal Current assets $ 742,798 Noncurrent assets 42,816 Current liabilities (567,454 ) Net assets $ 218,160 |
Basis of Presentation (Details
Basis of Presentation (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||
Net loss | $ (303,581) | $ (258,212) | $ (3,560,206) | $ (947,485) | ||||
Net current liability | 7,882,411 | 7,882,411 | $ 4,095,286 | |||||
Deficit on total equity | $ (3,065,809) | $ (3,066,320) | $ (3,065,809) | $ (3,066,320) | $ (2,676,500) | $ (3,066,724) | $ (2,757,668) | $ (2,177,550) |
Risks and Uncertainties (Detail
Risks and Uncertainties (Details Narrative) | 3 Months Ended | 9 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2020USD ($) | Dec. 31, 2020CNY (¥) | |
Outstanding borrowings | $ | $ 153,172 | ||
RMB [Member] | |||
Outstanding borrowings | ¥ | ¥ 1,000,000 | ||
Minimum [Member] | |||
Line of credit facility, interest rate | 4.84% | 4.84% | |
Maximum [Member] | |||
Line of credit facility, interest rate | 6.96% | 6.96% | |
One Customer [Member] | Minimum [Member] | |||
Percentage of sales | 10.00% | ||
Customer One [Member] | Garments [Member] | |||
Percentage of sales | 62.80% | 14.00% | 14.00% |
Two Customers [Member] | Minimum [Member] | |||
Percentage of sales | 10.00% | 10.00% | |
Customer Two [Member] | Epidemic Prevention Supplies [Member] | |||
Percentage of sales | 49.60% | 49.60% |
Risks and Uncertainties - Sched
Risks and Uncertainties - Schedule of Concentration of Risk by Customers (Details) | 9 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Mar. 31, 2020 | |
Logistics Services Segment [Member] | Customer A [Member] | ||
Concentration risk, percentage | 24.90% | 22.40% |
Logistics Services Segment [Member] | Customer B [Member] | ||
Concentration risk, percentage | 13.00% | 0.00% |
Logistics Services Segment [Member] | Customer C [Member] | ||
Concentration risk, percentage | 11.40% | 18.30% |
Logistics Services Segment [Member] | Customer D [Member] | ||
Concentration risk, percentage | 10.00% | 0.60% |
Logistics Services Segment [Member] | Customer E [Member] | ||
Concentration risk, percentage | 7.60% | 2.40% |
Accounts Receivable [Member] | Garment Manufacturing Segment [Member] | Customer A [Member] | ||
Concentration risk, percentage | 97.20% | 85.50% |
Accounts Receivable [Member] | Garment Manufacturing Segment [Member] | Customer B [Member] | ||
Concentration risk, percentage | 2.70% |
Risks and Uncertainties - Sch_2
Risks and Uncertainties - Schedule of Inventory Purchases from Suppliers (Details) - Five Largest Suppliers [Member] | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Garment Manufacturing Segment [Member] | ||||
Percentage of inventory purchase | 100.00% | 98.70% | 97.70% | 91.20% |
Logistic Services Segment [Member] | ||||
Percentage of inventory purchase | 79.10% | 90.40% | 99.70% | 69.00% |
Property Management and Subleasing [Member] | ||||
Percentage of inventory purchase | 100.00% | 100.00% | ||
Epidemic Prevention Supplies [Member] | ||||
Percentage of inventory purchase | 100.00% | 100.00% |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) | Sep. 30, 2020USD ($) |
Heng Sheng Wei Garments Co., Ltd [Member] | Jinlong Huang [Member] | |
Disposal of inventory | $ 114,229 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Related Parties (Details) | 9 Months Ended |
Dec. 31, 2020 | |
Zhida Hong [Member] | |
Name of Related Parties | Zhida Hong |
Relationship with the Company | President, CEO, and a director of the Company |
Zhongpeng Chen [Member] | |
Name of Related Parties | Zhongpeng Chen |
Relationship with the Company | A legal representative of HPF, became not a related party when HPF was disposed of in November, 2020 |
Bihua Yang [Member] | |
Name of Related Parties | Bihua Yang |
Relationship with the Company | A legal representative of XKJ |
Dewu Huang [Member] | |
Name of Related Parties | Dewu Huang |
Relationship with the Company | A legal representative of DT |
Jinlong Huang [Member] | |
Name of Related Parties | Jinlong Huang |
Relationship with the Company | A spouse of legal representative of HSW |
Related Party Transactions - _2
Related Party Transactions - Schedule of Related Parties Transactions (Details) - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 |
Amounts due to related parties | $ 6,448,905 | $ 5,429,440 |
Zhida Hong [Member] | ||
Amounts due to related parties | 5,698,498 | 5,043,489 |
Bihua Yang [Member] | ||
Amounts due to related parties | 244,094 | |
Dewu Huang [Member] | ||
Amounts due to related parties | 379,253 | 81,287 |
Zhongpeng Chen [Member] | ||
Amounts due to related parties | 160,427 | |
Jinlong Huang [Member] | ||
Amounts due to related parties | $ 127,060 | $ 144,237 |
Inventories (Details Narrative)
Inventories (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | ||||
Inventory write-off |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 122,354 | $ 230,742 |
Work in progress | 11,745 | 62,150 |
Finished goods | 29,134 | 54,639 |
Total inventories | $ 163,233 | $ 347,531 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Depreciation expense | $ 83,210 | $ 84,277 | ||
Two Production Lines [Member] | Epidemic Prevention Supplies [Member] | ||||
Property acquired during the period | 54,327 | |||
Seven Motor Truckers [Member] | Logistic Service [Member] | ||||
Property acquired during the period | 315,920 | |||
Old Machinery [Member] | ||||
Disposal of assets | 19,303 | |||
Accumulated depreciation | 18,661 | |||
Two Old Motor Truckers [Member] | ||||
Disposal of assets | 22,505 | |||
Accumulated depreciation | 15,791 | |||
Plant and Equipment [Member] | ||||
Depreciation expense | $ 32,051 | $ 27,648 | $ 83,210 | $ 84,277 |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 |
Plant and equipment, gross | $ 1,336,674 | $ 955,461 |
Less: accumulated depreciation | (442,286) | (370,442) |
Plant and equipment, net | 894,388 | 585,019 |
Production Plant [Member] | ||
Plant and equipment, gross | 84,685 | 67,247 |
Motor Vehicles [Member] | ||
Plant and equipment, gross | 1,228,746 | 868,743 |
Office Equipment [Member] | ||
Plant and equipment, gross | $ 23,243 | $ 19,471 |
Short-term Bank Loan (Details N
Short-term Bank Loan (Details Narrative) | 1 Months Ended | 9 Months Ended | |||||||||
Aug. 31, 2020USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2020CNY (¥) | Sep. 30, 2020USD ($) | Sep. 30, 2020CNY (¥) | Aug. 31, 2020CNY (¥) | Mar. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Aug. 31, 2019CNY (¥) | Sep. 30, 2018CNY (¥) | |
Minimum [Member] | |||||||||||
Line of credit facility, interest rate | 4.84% | ||||||||||
Maximum [Member] | |||||||||||
Line of credit facility, interest rate | 6.96% | ||||||||||
Facility Agreement [Member] | Dongguan Agricultural Commercial Bank [Member] | |||||||||||
Line of credit maximum borrowing capacity | $ 212,334 | ||||||||||
Line of credit facility, interest rate | 6.96% | ||||||||||
Facility Agreement [Member] | Dongguan Agricultural Commercial Bank [Member] | RMB [Member] | |||||||||||
Line of credit maximum borrowing capacity | ¥ | ¥ 1,500,000 | ||||||||||
Facility Agreement [Member] | Dongguan Agricultural Bank of China [Member] | |||||||||||
Line of credit maximum borrowing capacity | $ 153,172 | ||||||||||
Line of credit outstanding value | $ 153,172 | $ 211,868 | |||||||||
Line of credit facility, maturity date | Mar. 31, 2021 | ||||||||||
Facility Agreement [Member] | Dongguan Agricultural Bank of China [Member] | Minimum [Member] | |||||||||||
Line of credit facility, interest rate | 4.84% | ||||||||||
Facility Agreement [Member] | Dongguan Agricultural Bank of China [Member] | Maximum [Member] | |||||||||||
Line of credit facility, interest rate | 4.90% | ||||||||||
Facility Agreement [Member] | Dongguan Agricultural Bank of China [Member] | RMB [Member] | |||||||||||
Line of credit maximum borrowing capacity | ¥ | ¥ 1,000,000 | ||||||||||
Line of credit outstanding value | ¥ | ¥ 1,000,000 | ||||||||||
Facility Agreement [Member] | Webank [Member] | |||||||||||
Line of credit maximum borrowing capacity | $ 88,358 | $ 86,886 | |||||||||
Facility Agreement [Member] | Webank [Member] | Minimum [Member] | |||||||||||
Line of credit facility, interest rate | 16.20% | ||||||||||
Facility Agreement [Member] | Webank [Member] | Maximum [Member] | |||||||||||
Line of credit facility, interest rate | 16.20% | ||||||||||
Facility Agreement [Member] | Webank [Member] | RMB [Member] | |||||||||||
Line of credit maximum borrowing capacity | ¥ | ¥ 590,000 | ¥ 600,000 | |||||||||
Facility Agreement One [Member] | Dongguan Agricultural Bank of China [Member] | |||||||||||
Line of credit maximum borrowing capacity | $ 141,246 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Percentage of preferential tax benefits and EIT rate and term description | The preferential tax rate will be expired at end of year 2022 and the EIT rate will be 25% from year 2023. | |||
Deferred taxes | ||||
Percentage of preferential value added tax | 3.00% | 3.00% | ||
Domestic Tax Authority [Member] | ||||
Percentage of value added tax | 13.00% | |||
Dongguan Heng Sheng Wei Garments Co., Ltd [Member] | ||||
Percentage of preferential value added tax | 13.00% | |||
Logistic Company [Member] | ||||
Percentage of value added tax | 9.00% | |||
Minimum [Member] | ||||
Percentage on enterprise income tax | 5.00% | 5.00% | ||
Maximum [Member] | ||||
Percentage on enterprise income tax | 15.00% | 15.00% | ||
Hong Kong [Member] | ||||
Income tax rate | 16.50% | |||
People's Republic of China [Member] | ||||
Federal statutory tax rate | 25.00% | 25.00% | 25.00% | 25.00% |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Income Taxes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income tax expense | $ 15,784 | $ 9,022 | $ 23,196 | $ 12,086 |
People's Republic of China [Member] | ||||
PRC statutory tax rate | 25.00% | 25.00% | 25.00% | 25.00% |
Computed expected expenses | $ (71,949) | $ (62,297) | $ (884,253) | $ (233,850) |
Temporary differences | 29,440 | 22,942 | 629,954 | 32,028 |
Permanent difference | 6,640 | 131,595 | ||
Change in valuation allowance | 51,653 | 48,377 | 145,900 | 213,908 |
Income tax expense | $ 15,784 | $ 9,022 | $ 23,196 | $ 12,086 |
Consolidated Segment Data (Deta
Consolidated Segment Data (Details Narrative) | 9 Months Ended |
Dec. 31, 2020Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 4 |
Consolidated Segment Data - Sch
Consolidated Segment Data - Schedule of Segment Reporting Information, by Segment (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2020 | |
Total of reportable segments and consolidated revenue | $ 3,411,552 | $ 4,027,902 | $ 21,014,064 | $ 8,182,396 | |
Total of reportable segments | (39,054) | (18,082) | (2,958,370) | 19,169 | |
Reconciliation - Corporate | (249,472) | (227,210) | (634,645) | (927,569) | |
Total consolidated loss from operations | (288,526) | (245,292) | (3,593,015) | (908,400) | |
Total of reportable segments | 14,743,645 | 14,743,645 | $ 6,520,898 | ||
Reconciliation - Corporate | 2,534,719 | 2,534,719 | 1,901,080 | ||
Consolidated total assets | 17,278,364 | 17,278,364 | 8,421,978 | ||
Garment Manufacturing Segment [Member] | |||||
Total of reportable segments and consolidated revenue | 2,287,981 | 2,643,560 | 5,186,042 | 3,517,009 | |
Total of reportable segments | 98,905 | 158,268 | 240,423 | 187,803 | |
Total of reportable segments | 2,628,877 | 2,628,877 | 4,098,758 | ||
Logistic Services Segment [Member] | |||||
Total of reportable segments and consolidated revenue | 824,025 | 1,384,342 | 3,664,409 | 4,665,387 | |
Total of reportable segments | 57,222 | (176,350) | 92,506 | (168,634) | |
Total of reportable segments | 1,877,949 | 1,877,949 | 2,422,140 | ||
Property Management and Subleasing [Member] | |||||
Total of reportable segments and consolidated revenue | 294,759 | 294,759 | |||
Total of reportable segments | 5,966 | 5,966 | |||
Total of reportable segments | 9,993,744 | 9,993,744 | |||
Epidemic Prevention Supplies Segment [Member] | |||||
Total of reportable segments and consolidated revenue | 4,787 | 11,868,854 | |||
Total of reportable segments | (201,147) | (3,297,265) | |||
Total of reportable segments | $ 243,075 | $ 243,075 |
Accrued Expenses and Other Pa_3
Accrued Expenses and Other Payables - Schedule of Accrued Expenses and Other Payables (Details) - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accrued wages and welfare | $ 58,874 | $ 61,776 |
Other tax payable | 51,387 | 25,206 |
Rental payable | 52,833 | 24,972 |
Customers' deposits | 210,785 | |
Other payables | 37,437 | 118,963 |
Accrued expenses and other payables | $ 411,316 | $ 230,917 |
Lease Right-of-Use Asset and _3
Lease Right-of-Use Asset and Lease Liabilities (Details Narrative) - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Apr. 02, 2019 |
Operating lease, right of use asset | $ 11,604,526 | $ 1,835,717 | ||
Operating lease, liability | $ 11,604,526 | |||
Weighted average discount rate leases | 4.35% | 4.35% | ||
Head Office [Member] | ||||
Lease period | 5 years | |||
Plant and Dormitory [Member] | ||||
Lease period | 4 years 6 months | |||
Floors in Commercial Building [Member] | ||||
Lease period | 3 years | |||
ASU 2016-02 [Member] | ||||
Operating lease, right of use asset | $ 60,000 | |||
Operating lease, liability | $ 60,000 |
Lease Right-of-Use Asset and _4
Lease Right-of-Use Asset and Lease Liabilities - Schedule of Components of Lease Expense (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||||
Operating lease cost | $ 444,162 | $ 126,053 | $ 668,883 | $ 325,664 |
Short-term lease cost | 6,445 | 70,231 | ||
Lease cost | $ 444,162 | $ 132,498 | $ 668,883 | $ 395,895 |
Lease Right-of-Use Asset and _5
Lease Right-of-Use Asset and Lease Liabilities - Schedule of Supplemental Information for Right-of Use Asset and Lease Liabilities (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||||
Cash paid for amounts included in the measurement of lease liabilities: Operating cash flow from operating leases | $ 444,162 | $ 132,498 | $ 668,883 | $ 395,895 |
Right-of-use assets obtained in exchange for new operating leases liabilities | $ 10,378,042 | $ 65,527 | $ 10,404,962 | $ 1,966,535 |
Weighted average remaining lease term - Operating leases (years) | 3 years 1 month 6 days | 4 years 6 months | 3 years 1 month 6 days | 4 years 6 months |
Weighted average discount rate - Operating leases | 4.35% | 4.35% | 4.35% | 4.35% |
Lease Right-of-Use Asset and _6
Lease Right-of-Use Asset and Lease Liabilities - Summary of Maturity of Operating Lease Liabilities (Details) | Dec. 31, 2020USD ($) |
Leases [Abstract] | |
2021 | $ 4,092,830 |
2022 | 4,107,892 |
2023 | 4,145,246 |
2024 | 310,197 |
Total lease payments | 12,656,165 |
Less: Interest | (1,051,639) |
Total | $ 11,604,526 |
Share Capital (Details Narrativ
Share Capital (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended |
Aug. 31, 2020 | Dec. 31, 2020 | |
Equity [Abstract] | ||
Company offered common stocks shares | $ 747,000 | $ 3,735,000 |
Subscription price | $ 5 |
Disposition of Subsidiaries (De
Disposition of Subsidiaries (Details Narrative) - USD ($) | Nov. 16, 2020 | Oct. 02, 2020 |
DT [Member] | ||
Gain or loss recognized on disposal | ||
HPF [Member] | ||
Gain or loss recognized on disposal |
Disposition of Subsidiaries - S
Disposition of Subsidiaries - Summary of Financial Position of Entities and Gain or Loss on Disposal (Details) - USD ($) | Nov. 16, 2020 | Sep. 30, 2020 |
Garment Manufacturing Segment [Member] | DT [Member] | ||
Current assets | $ 675,515 | |
Noncurrent assets | ||
Current liabilities | (70,742) | |
Net assets | $ 604,773 | |
Logistic Services Segment [Member] | HPF [Member] | ||
Current assets | $ 742,798 | |
Noncurrent assets | 42,816 | |
Current liabilities | (567,454) | |
Net assets | $ 218,160 |