Executive Summary / Key Takeaways

• DirectBooking Technology Co., Ltd. (ZDAI) is undergoing a significant strategic transformation, pivoting from its traditional Hong Kong-based construction support services to embrace diversified growth, notably through the acquisition of China Wangmao Liquor Industry Group to enter the premium Baijiu market.
• Despite a notable increase in total revenue to $19.28 million in 2025, the company experienced a sharp decline in profitability, reporting a net loss of -$6.98 million and negative operating margins, signaling significant operational challenges and increased expenses.
• ZDAI aims to leverage proprietary technology in AI and IoT for sustainable engineering, enhancing waste management efficiency and digitized supply chains, which could provide a competitive edge in niche eco-friendly projects against larger tech rivals.
• The company's liquidity improved with working capital reaching $6.77 million in 2025, supported by a $5.28 million capital stock issuance, which helped offset negative free cash flow of -$2.82 million.
• Investors should closely monitor the integration of the Baijiu acquisition and the execution of ZDAI's technology-driven diversification strategy, as these initiatives are critical to reversing recent profitability declines and establishing a sustainable growth trajectory.

From Foundations to Diversification: ZDAI's Evolving Identity

DirectBooking Technology Co., Ltd. (ZDAI), originally established in 2018 as Primega Group Holdings Limited, has built its foundation on providing essential soil and rock transportation services within Hong Kong's dynamic construction sector. The company's core operations involve the handling, loading, and transport of excavated materials to government waste disposal facilities, alongside specialized construction works such as excavation and lateral support, and bored piling services for private sector projects. This established presence in Hong Kong's infrastructure development has been a cornerstone of its business model.

A pivotal moment in ZDAI's corporate journey was its initial public offering (IPO) on July 24, 2024, where it successfully offered 1.50 million ordinary shares at $4.0 per share. This public listing followed a 2-for-1 share split on February 28, 2024, which increased its outstanding shares to 22.50 million. More recently, in a bold strategic move announced in August 2025, the company, then known as Primega Group, declared its intention to acquire China Wangmao Liquor Industry Group Co. Limited. This acquisition marks a significant diversification into the premium Baijiu market, signaling a clear intent to expand beyond its traditional engineering and construction roots and drive diversified growth. Reflecting this evolving strategic direction, the company formally changed its name to DirectBooking Technology Co., Ltd. in September 2025.

The Technological Edge and Market Positioning

DirectBooking Technology is strategically positioning itself to integrate advanced technological solutions into its operations and new ventures. The company is developing proprietary technology focused on AI and IoT integration within sustainable engineering. This technology aims to enhance waste management efficiency and improve resource reuse, particularly within its construction support services. Furthermore, ZDAI is exploring digitized supply chain platforms, broader AI and IoT integration, cloud computing, and intelligent engineering equipment, indicating a forward-looking approach to operational excellence.

This technological emphasis provides ZDAI with a distinct competitive advantage in its niche. Its eco-friendly innovations, such as those improving waste management efficiency, translate into tangible benefits like enhanced resource reuse, potentially fostering stronger customer loyalty and recurring revenue from long-term projects. This could lead to superior margins through operational cost savings and better capital efficiency by reducing waste. While precise quantitative metrics for these benefits are not publicly detailed, the strategic intent is to differentiate ZDAI by offering more targeted, eco-friendly solutions, particularly against larger, more generalized infrastructure providers.

In the broader competitive landscape, ZDAI operates as a niche player. Its focus on sustainable construction services and emerging tech integrations contrasts with the scale and extensive resources of industry giants like Zayo Group Holdings Inc. (ZAYO), Meta Platforms Inc. (META), and Alphabet Inc. (GOOGL). Zayo, for instance, is a major player in fiber optic infrastructure, expanding networks to support AI-driven data centers. Meta and Alphabet are leaders in AI, cloud computing, and large-scale data center development. While ZDAI's emphasis on eco-friendly solutions and specialized applications in construction waste reduction offers a unique value proposition, it operates at a significantly smaller scale.

ZDAI's established network in the Hong Kong construction sector serves as a crucial moat, providing a localized advantage. However, its smaller scale and potential technological gaps in advanced AI infrastructure represent vulnerabilities. These could lead to higher operational costs and slower innovation compared to competitors with vast R&D budgets and global reach. For example, less advanced AI capabilities might result in longer development cycles, potentially impacting revenue growth. Despite these challenges, the high barriers to entry in its core industries, such as stringent regulatory requirements for sustainable practices and significant capital needs for AI technology, help ZDAI defend its market position by limiting new entrants.

Financial Performance: Growth Amidst Profitability Challenges

DirectBooking Technology's financial performance in the fiscal year ending March 31, 2025, presents a mixed picture of revenue growth alongside significant profitability challenges. The company reported total revenue of $19.28 million in 2025, a substantial increase from $13.46 million in 2024 and $11.14 million in 2023. This top-line growth suggests an expanding operational footprint or increased demand for its services.

However, this revenue growth was overshadowed by a sharp deterioration in profitability. Gross profit declined to $1.68 million in 2025 from $2.77 million in 2024, indicating a weakening gross margin of 8.71%. The situation worsened further down the income statement, with operating expenses surging to $8.73 million in 2025, a significant jump from $1.15 million in 2024. This dramatic increase in expenses led to a negative operating income of -$7.05 million and a deeply negative operating margin of -80.29% in 2025. The company ultimately reported a net loss of -$6.98 million in 2025, a stark contrast to net incomes of $1.09 million in 2024 and $1.17 million in 2023. This translates to a profit margin of -36.22% and a negative Return on Equity of -107.14%.

From a liquidity perspective, ZDAI's working capital improved to $6.77 million in 2025 from $2.25 million in 2024, suggesting an enhanced short-term liquidity position. However, the company's free cash flow turned negative at -$2.82 million in 2025, a decline from positive free cash flows in previous years, indicating cash burn from operations and investments. This negative operational cash flow was partially offset by a positive financing cash flow of $2.79 million, primarily driven by a $5.28 million issuance of capital stock in 2025.

The company's net debt decreased to $494,661 in 2025 from $554,684 in 2024.

Strategic Outlook and Inherent Risks

DirectBooking Technology's strategic outlook is heavily influenced by its recent diversification into the premium Baijiu market. The acquisition of China Wangmao Liquor Industry Group represents a significant pivot, aiming to drive diversified growth and showcase the company's innovation capabilities in new business sectors. This initiative suggests a future where ZDAI's revenue streams are less reliant on the cyclical nature of the construction industry in Hong Kong. The success of this diversification will depend on effective integration and market penetration within the highly competitive Baijiu sector.

While the company has not provided specific quantitative guidance, the strategic shift implies an expectation of future growth and improved profitability from these new ventures. The underlying assumption is that the premium Baijiu market offers attractive opportunities for expansion and margin improvement, which could eventually offset the current profitability challenges in its legacy business.

However, this strategic pivot is not without risks. The company faces the inherent challenges of entering a new industry, including market acceptance, brand building, and navigating a different regulatory landscape. Operationally, the significant increase in selling, general, and administrative expenses to $8.03 million in 2025 from $1.21 million in 2024, coinciding with the strategic shift, suggests substantial investment in these new initiatives. Managing these costs effectively will be crucial for achieving profitability.

A specific legal risk highlighted in the company's filings pertains to the enforceability of indemnification for directors and officers under the Securities Act. The SEC's opinion views such indemnification as against public policy, making it unenforceable. In the event of a claim, ZDAI has undertaken to submit the question of indemnification to a court of appropriate jurisdiction, unless settled by controlling precedent. This legal uncertainty could pose a risk to governance and executive protection.

Conclusion

DirectBooking Technology Co., Ltd. stands at a critical juncture, transforming from a specialized construction support provider into a diversified entity with ambitions in the premium Baijiu market and advanced technological integration. The strategic acquisition of China Wangmao Liquor Industry Group, coupled with its rebranding, underscores a bold vision for future growth. While the company demonstrated revenue growth in 2025, its significant decline into unprofitability, marked by a net loss of -$6.98 million and negative operating margins, highlights the immediate challenges it faces in managing costs and achieving operational efficiency amidst this transition.

The investment thesis for ZDAI hinges on the successful execution of its diversification strategy and the realization of benefits from its proprietary AI and IoT technologies in sustainable engineering. These technological differentiators, aimed at enhancing waste management and digitized supply chains, offer a potential competitive moat in niche eco-friendly segments, distinguishing ZDAI from larger, more generalized tech and infrastructure players. However, the company's smaller scale and the substantial investments required for its strategic pivot present vulnerabilities against well-capitalized competitors. Investors must weigh the potential for long-term growth from these new ventures against the current financial headwinds and the inherent risks associated with entering new, competitive markets. The ability of ZDAI's management to integrate the Baijiu business effectively and translate its technological aspirations into tangible, profitable outcomes will be paramount in shaping its future trajectory and validating its evolving investment narrative.