IPO News | Infinite Reality Proposes Hong Kong Stock Listing, China Securities Regulatory Commission Requests Concluding Opinions on Fairness of Equity Incentives

Zhitong Finance App learned that on July 24, the China Securities Regulatory Commission announced the requirements for supplementary materials for overseas issuance and listing registration (July 13, 2026 to July 24, 2026). The China Securities Regulatory Commission issued supplementary material requirements for 4 companies including Infinite Reality. Among them, the Securities Regulatory Commission requested XREAL Ltd. (XREAL Ltd.) to issue a concluding opinion on the fairness of equity incentives, whether they are legal and compliant, and whether there are benefits. According to reports, XREAL Ltd. submitted a listing application to the main board of the Hong Kong Stock Exchange on April 1, 2026, with CICC and Citibank as co-sponsors.

The China Securities Regulatory Commission requested the company to provide additional explanations on the following matters. Lawyers carried out inspections and issued clear legal opinions:

1. Equity structure construction and compliance with return mergers and acquisitions. Please explain (1) whether shareholders holding 5% or more of the shares comply with domestic regulatory procedures such as foreign exchange registration and foreign investment; (2) whether domestic and foreign investment enterprises controlled by the company fulfill foreign investment information reporting obligations and go through foreign exchange registration procedures; (3) the reasons for Infinite Shanghai's acquisition of Unai Cohn, as well as transaction consideration, pricing basis, tax payment, etc., are in line with the “Regulations on mergers and acquisitions of domestic enterprises by foreign investors”; (4) In the process of dismantling the VIE structure, Shenzhen Tairuo investors will reduce their capital and transfer their shares. trading pairs Concluding opinions on price, pricing basis, tax payment, etc. on whether the capital reduction process complied with the provisions of the “Company Law” and whether there were acts such as false investment or evasion of capital; (5) The equity structure construction and return merger and acquisition process complied with the regulations on foreign exchange management, overseas investment, foreign investment, tax administration, etc. in effect at the time.

2. Regarding the share capital situation, please explain (1) when the company issued shares to QUARTZ SCENE in March 2026, please check and explain the requirements for new shareholders in the last 12 months in accordance with the “Guidelines for the Application of Regulatory Rules - Overseas Issuance and Listing Class No. 2” (hereinafter referred to as “Regulatory Guidelines No. 2”); (2) the reasons for the differences in the shareholding prices of the new shareholders within the last 12 months, the fairness of the share price, and issue a clear concluding opinion on whether there are benefits.

3. Regarding equity incentives, please explain (1) explain the participation of former employees in equity incentives in accordance with “Regulatory Guidelines No. 2”; (2) issue concluding opinions on the fairness of equity incentives, whether they are legal and compliant, and whether benefits exist.

4. Regarding domestic operating entities, please explain (1) whether litigation cases involving major domestic operating entities such as Unai Cohn have had a significant adverse impact on the company's financial situation or business operations, or whether they constitute a substantial obstacle to the next issuance and listing; (2) Shine Wuxi was investigated by the customs department due to a lack of compliance with the tax registration number, and whether there are any circumstances stipulated in section 8 of the “Trial Measures on the Administration of Overseas Issuance of Securities and Listing of Domestic Enterprises”; (3) Please issue a concluding opinion on whether the establishment of the main domestic operating entity and the successive shareholding changes are legal and compliant.

5. Regarding the current issuance and listing plan, the maximum number of filing materials and prospectus issued should be consistent. If there are any inconsistencies, please provide a revised filing report or prospectus. If the prospectus involves increasing the amount of current issuance and the scale of capital raised, please also update the plan for the use of funds raised.

According to the prospectus, XREAL is an AR glasses company that designs, develops, manufactures and sells AR glasses under its own brand, and provides related products and services. Currently, the company's product line can be summarized into three main series: Air series, One series, and Light-Ultra-Aura product line.

According to iResearch, in terms of sales revenue, the company ranked first in the global AR glasses market every year from 2022 to 2025; in terms of sales revenue in 2025, the company ranked second in the entire global smart glasses market, including AR glasses and non-display glasses, and ranked first in China.