Mega Fortune Company Limited

Data availability

• The company was formed for listing in 2024. Audited consolidated statements cover FY2023–FY2025, and the F-1 also gave FY2022 revenue.

FY2021 is not publicly disclosed: and is omitted from the tables.

• Blank cells mean the figure is not publicly disclosed in sources reviewed.

• Interim H1 FY2026 data is shown separately because it is not a full fiscal year.

Income statement

Notes:

• FY2025 figures are from the 20-F FY25 via SEC XBRL (equibles.com).

• FY2024 gross profit and cost of revenue are derived from the 53.9% gross margin.

• FY2023 and FY2024 EPS are derived as net income divided by 10.0M restated shares. A data aggregator (roic.ai) shows US$0.02 and US$0.04, so the FY2023 figure conflicts.

• FY2022 revenue is per the F-1 (via tickergate).

• EBITDA and pre-tax income are not separately reported. FY2025 depreciation and amortization is immaterial (about US$4k of depreciation plus right-of-use amortization), so EBITDA approximates operating income at about US$2.25M (derived).

Margins (%).

Revenue CAGR:

• FY2022–FY2025: about 47% a year (derived).

• FY2023–FY2025: about 85% a year (derived).

• Both figures are dominated entirely by FY2025.

Half-year decomposition

H2 values equal the full year minus H1.

Commentary on the income statement.

FY2022–FY2024 shows a stable, sub-scale business: about US$3.3M of revenue and US$0.4–0.5M of net profit. The FY2025 inflection was attributed to three drivers [20-F FY25]:

• larger IoT projects from new customers;

• seven new BPO customers; and

• broader support contracts.

The half-year split exposes an unusual pattern:

H1 FY2025: gross margin fell to 25.8% on subcontractor reliance.

H2 FY2025: gross margin was about 74% on similar revenue (US$5.7M). That is well above any service-line margin the company has disclosed (IoT 52.4% for the full year).

H2 opex: jumped to about US$3.0M, against US$0.35M in H1.

The 20-F mentions higher sales-team compensation (US$86k to about US$0.3M), which explains only a small part of the opex increase.

H1 FY2026 inflection:

• Revenue −90%.

• Selling and marketing expense rose to US$2.55M (+1,915%). The company describes this as expanding the sales and business-development team.

• G&A rose to US$1.09M (+398%). The company attributes this mainly to advisory and consultancy services.

• The net loss was US$3.41M, against US$0.91M of profit a year earlier.

The cost base no longer bears any relationship to the revenue base.

Balance sheet

Notes:

• FY2024 cash and equity come from the H1 FY25 / H1 FY26 statements.

• The FY2025 balance sheet is from the 6-K H1FY26 audited comparative.

Latest interim balance sheet, 31 Mar 2026 (unaudited; 6-K H1FY26).

Derived: net debt at 31 Mar 2026 was about US$0.60M, and working capital was about US$7.45M.

Cash flow

Notes:

• Operating cash flow is per the 20-F FY25 risk factors.

• Capex is immaterial: property and equipment was US$6k at FY2025.

• FY2025 financing inflow is not separately extracted. The IPO raised US$15.0M gross, and additional paid-in capital rose by about US$12.3M, implying net IPO proceeds of about US$12.3M after costs.

Interim cash flows, six months ended 31 March (US$).

Commentary on cash flow and the balance sheet.

The central analytical fact is that the IPO money did not remain as cash. About US$12.3M of net proceeds was raised in July 2025. By 30 September 2025:

• cash was US$0.77M;

• prepayments and other assets totalled US$11.3M (current plus non-current); and

• receivables were US$6.2M, equal to about 205 days of FY2025 revenue (derived).

The FY2025 operating outflow of US$12.0M therefore reflects mainly cash paid out as prepayments, not losses.

In H1 FY2026 the company described the US$1.94M fall in prepayments as amortization of business-development expense. That expense appears in the elevated selling and marketing line. The prepaid balance is effectively being expensed through the P&L.

At 31 March 2026, cash of US$9,813 covered less than 1% of current liabilities of US$1.16M. Liquidity depends on two things:

• collecting the US$3.5M of receivables; and

• whether the US$9.3M of prepayments yields services or refunds.

There is no going-concern conclusion in the materials reviewed, but this is a key monitorable.

Ratios

Notes:

• All ratios are derived.

• FY2024 ROE uses year-end equity (US$1.36M).

• ROIC is approximately NOPAT (about US$1.88M at a 16.5% Hong Kong profits-tax rate) divided by average equity plus debt.

• H1 FY2025 interest was US$7,316 against operating income of US$1.04M, giving more than 140x. In H1 FY2026 operating income was negative, so coverage was negative.

• Cash conversion cycle: not computable from sources (inventory immaterial; payables days not derived).

Guidance and consensus

Management guidance: None. The H1 FY2026 release links the sales-team expansion to "expectation on revenue growth in the future" but gives no quantified targets.

Consensus: None (no coverage).

Bull case

1. Proven scalability. QBS took revenue from US$3.3M to US$11.1M in one year while keeping a 50.7% gross margin, so the operating platform can scale when large projects are won.

2. Controller backing. A new controlling group holds 77% and has invested about US$7M. It may inject capital, customers or assets, using the listed vehicle's equity value as currency.

3. Pre-paid growth spend. US$9.3M of remaining prepayments and the new sales and business-development investment could convert into a rebuilt pipeline. Receivables (US$3.5M) offer near-term liquidity if collected.

Bear case

1. The fundamentals have collapsed. H1 FY2026 annualized revenue is about US$1.0M, and the business is loss-making with US$9,813 of cash. The US$1.4B valuation implies roughly 1,400x annualized revenue.

2. Earnings quality is questionable. These features of FY2025 profits warrant scrutiny of whether reported results reflect durable economics:

   • H2 FY2025 gross margin of about 74% against 25.8% in H1;

   • operating cash flow of −US$12M against US$1.8M of profit;

   • US$11.3M of prepayments funded by IPO cash and then expensed as "business development"; and

   • an auditor change after the IPO.

3. Governance and structural risk. Specifically:

   • 85% insider and affiliate ownership;

   • control bought at about US$0.70/share;

   • an "independent" director who runs the controller's vehicle;

   • delayed disclosures; and

   • a float of about 3M shares. This leaves minority holders exposed to dilution, related-party dealings and sharp liquidity-driven price reversals.

Catalysts and monitorables (next 12 months)

Analyst verdict

Mega Fortune is two very different companies under one ticker.

The operating company. QBS System is a credible but tiny Hong Kong IoT integrator. It ran at about US$3.3M of revenue for three years, had one standout year (FY2025: US$11.1M revenue, US$1.8M profit), and has since shrunk to an annualized run-rate of about US$1M with heavy losses.

The listed vehicle. This entity changed hands in late 2025 and early 2026 at an implied value of about US$7M for 73% of the equity. It rebuilt its board around the acquirer's circle and now trades at about US$1.4B on a float of roughly 3M shares.

Nothing in the public record bridges these two pictures:

• no guidance;

• no disclosed strategy from the new owners;

• no named partnerships;

• no disclosed IP; and

• no verifiable market-share gains.

The financial trail instead raises questions that need answers:

Where did the IPO money go?: Most of the roughly US$12.3M net proceeds became prepayments within weeks of listing. Those prepayments are now being expensed, while revenue fell 90% and cash fell to under US$10,000.

What drove the second-half spike?: The H2 FY2025 margin spike to about 74% is unexplained by the disclosed service-line margins.

Governance signals are weak:

• CEO and Chair roles are combined;

• an affiliated "independent" director sits on the board;

• the auditor changed after the IPO; and

• board changes were disclosed about three months late.

On fundamentals, intrinsic value is a small fraction of the current market price. Equity of US$12.1M (much of it prepayments and receivables of uncertain recoverability) sets a generous upper bound on asset value, at about US$0.88 per share. The share price is driven by float scarcity and speculative flows, not by the business.

Conclusion:

• For institutional purposes, MGRT is uninvestable on a fundamental basis.

• It carries very high risk of dilution, a liquidity-driven price collapse, and regulatory or listing complications.

• The FY2026 20-F, due around January 2027, is the decisive document. Key items are the audit opinion, going-concern language, the recoverability of prepayments, and any disclosure of the controller's intentions.

• Until that filing provides clarity, the appropriate stance is avoid, monitor only.