Yunying Valley Technology (03310): Two holding subsidiaries have been set up to launch two new businesses, optical interconnection and UCie IP

According to the Zhitong Finance App, Yunying Valley Technology (03310) announced that the company has established two holding subsidiaries, namely Digital Engineering Zhiyun (Shanghai) Technology Co., Ltd. (Digital Engine) and Xinqing Zhiyun (Shanghai) Technology Co., Ltd. (Xinqing Zhiyun). The registered capital of Digital Engineering Zhiyun and Xinqing Zhiyun are both RMB 10 million, and the company holds 55% of the shares in each of the two holding subsidiaries. The Group plans to launch two new businesses, Optical Interconnect and UCIe IP. Digital Engine Smart Cloud is the operator of the Group's optical interconnect business, focusing on the micro-VCSEL light source technology route. It aims to become an overall optical I/O solution provider, focusing on the two major fields of Scale Up (in-cabinet interconnection) and Scale In (inter-chip interconnection). Xinqing Zhiyun is the operating entity of the Group's uCie IP business. Using the cross-standard UCie interconnection IP licensing business as an entry point, it plans to develop into a platform-based IP company in the future.

As of the date of this announcement, Digital Smart Cloud and Smart Smart Cloud are each promoting private equity financing in the primary market. The relevant financing is still in the negotiation and due diligence stage. Its completion is only possible after a formal capital increase agreement is signed and relevant prerequisites are met, and may not necessarily be carried out or completed.

The holding subsidiary has been established for a short time, and the new businesses mentioned above are all in the very early stages of development and preparation. As of the date of this announcement, none of the holding subsidiaries have formed mass-produced products or generated any revenue, and there is uncertainty about their technology research and development progress, product commercialization schedule, and market acceptance. It is anticipated that these new businesses will not make any significant contribution to the Group's revenue, profit and financial position in the short term. The Group's revenue and profits will continue to come mainly from existing main businesses such as display driver chips in the foreseeable future.

Proceeds from the above financing are intended to be used mainly for R&D investment and business development of the holding subsidiary. It is expected that after the financing is completed, the company will maintain its controlling position over Digital Engine and Xinqing Zhiyun, and the holding subsidiary will continue to be incorporated into the Group's consolidated financial statements. The financing matters are not expected to have a significant impact on the Group's financial position and operating results.

The two new businesses, Optical Interconnect and UCIe IP, are the company's recent business layout after listing in response to industry technology trends and market opportunities. The board of directors believes that with the rapid development of artificial intelligence, cloud computing, high-performance computing and advanced packaging technology, the demand for high-speed interconnection between chips continues to rise, and on-chip optical interconnect and Chiplet interconnect have become one of the important development directions of the semiconductor industry. As one of the important light source technology routes for on-chip optical interconnection, micro-VCSEL has the characteristics of low power consumption, low cost, easy two-dimensional array integration, etc., and has good application potential in short-range optical interconnection scenarios; uCie, as an open core interconnection standard, is expected to promote ecological standardization and large-scale application of Chiplet. The layout of the two new businesses, optical interconnection and UCiE IP, is in line with the Group's strategic direction of seizing industry opportunities, expanding the business landscape, and cultivating new growth points. By establishing an independent operator, the Group can focus more on promoting related technology R&D, commercialization and market expansion, and use market-based financing to introduce external resources to accelerate business development, thereby enhancing the Group's overall competitiveness and long-term shareholder value.