| PARENT-ONLY FINANCIALS |
19. PARENT-ONLY FINANCIALS The Company’s PRC subsidiary is restricted in its ability to transfer a portion of its net assets to the Company. Payment of dividends by the entity organized in the PRC is subject to limitations, procedures and formalities. Regulations in the PRC currently permit payments of dividends only out of accumulated profits as determined in accordance with accounting standards and regulations in the PRC. The Company’s PRC subsidiary is also required to set aside at least 10% of its after-tax profit based on PRC accounting standards each year to its statutory reserves account until the accumulative amount of such reserves reaches 50% of its respective registered capital. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. As of March 31, 2026, The Company’s PRC subsidiary has incurred accumulated losses, and the Company has concluded that the subsidiary is unable to remit any portion of its net assets to the Company In addition, the Company’s operations and revenues are conducted and generated in the PRC, all of the Company’s revenue being earned and currency received is denominated in RMB. RMB is subject to the foreign exchange control regulation in China, and, as a result, the Company may be unable to distribute any dividends outside of China due to PRC foreign exchange control regulations that restrict the Company’s ability to convert RMB into USD. Regulation S-X requires that the condensed financial information of registrant shall be filed when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. For purposes of the above test, restricted net assets of consolidated subsidiaries shall mean that amount of the registrant’s proportionate share of net assets of consolidated subsidiaries (after intercompany eliminations) which as of the end of the most recent fiscal year may not be transferred to the parent company by subsidiaries in the form of loans, advances or cash dividends without the consent of a third party. The Company has a consolidated shareholders’ deficit, its net asset base for purposes of calculating the proportionate share of restricted net assets of consolidated subsidiaries should be zero. And the Company’s PRC subsidiary has restricted net assets, therefore, any restrictions placed on the net assets of subsidiaries with positive equity would result in the 25 percent threshold being exceeded and a corresponding requirement to provide parent company-only financial information. Certain information and footnote disclosures normally included in financial statements prepared in conformity with generally accepted accounting principles have been condensed or omitted. The Company’s investment in subsidiary is stated at cost plus equity in undistributed loss of subsidiaries. CONDENSED BALANCE SHEETS | | | March 31, | | | March 31, | | | | | 2026 | | | 2025 | | | ASSETS | | | | | | | | Current Assets | | | | | | | | Cash | | $ | 1,800 | | | $ | 999 | | | Due from subsidiaries | | | 2,148,569 | | | | 10,435,066 | | | Due from a related party | | | — | | | | 75,000 | | | Prepayments, other receivables and other current assets, net | | | 199,143 | | | | — | | | Total Current Assets | | | 2,349,512 | | | | 10,511,065 | | | | | | | | | | | | | Other Assets | | | | | | | | | | Intangible assets | | | 300,000 | | | | 375,000 | | | Total Assets | | $ | 2,649,512 | | | $ | 10,886,065 | | | | | | | | | | | | | LIABILITIES, MEZZANINE EQUITY AND DEFICIT | | | | | | | | | | Current Liabilities | | | | | | | | | | Accrued expenses and other liabilities | | $ | 480,578 | | | $ | 1,080,265 | | | Due to a related party | | | 78,398 | | | | — | | | Due to a subsidiary | | | 113,521 | | | | — | | | Derivative liabilities | | | 5,615,288 | | | | 84,591 | | | Total Current Liabilities | | | 6,287,785 | | | | 1,164,856 | | | | | | | | | | | | | Other Liabilities | | | | | | | | | | Excess of investments in subsidiaries | | | 2,152,189 | | | | 12,342,408 | | | Total Liabilities | | | 8,439,974 | | | | 13,507,264 | | | | | | | | | | | | | Commitments and Contingencies | | | | | | | | | | Mezzanine Equity | | | | | | | | | | Series A convertible preferred stock (par value $1,000 per share, 5,000 shares authorized; 262 and 991 shares issued and outstanding at March 31, 2026 and 2025, respectively) | | | 42,943 | | | | 234,364 | | | | | | | | | | | | | Stockholders’ deficit | | | | | | | | | | Common stock (par value $0.0001 per share, 50,000,000 shares authorized; 4,557,489 and 1,051,804 shares issued and outstanding at March 31, 2026 and 2025, respectively) * | | | 456 | | | | 105 | | | Additional paid-in capital | | | 45,397,481 | | | | 43,951,069 | | | Accumulated deficit | | | (50,379,773 | ) | | | (45,109,573 | ) | | Accumulated other comprehensive loss | | | (851,569 | ) | | | (1,697,164 | ) | | Total Senmiao Technology Limited Stockholders’ deficit | | | (5,833,405 | ) | | | (2,855,563 | ) | | Total Liabilities, Mezzanine Equity and deficit | | $ | 2,649,512 | | | | 10,886,065 | | | * | Giving retroactive effect to the 1-for-10 reverse stock split effected on July 29, 2025 | CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | | | For the Years Ended
March 31, | | | | | 2026 | | | 2025 | | | General and administrative expenses | | $ | (1,753,320 | ) | | $ | (978,022 | ) | | Other income, net | | | 200,006 | | | | — | | | Change in fair value of derivative liabilities | | | 202,959 | | | | 204,242 | | | Excess of warrant fair value over offering proceeds | | | (2,896,455 | ) | | | — | | | Equity of losses in subsidiaries | | | (1,023,390 | ) | | | (2,951,525 | ) | | Net loss | | $ | (5,270,200 | ) | | $ | (3,725,305 | ) | | | | For the Years Ended
March 31, | | | | | 2026 | | | 2025 | | | Cash Flows from Operating Activities: | | | | | | | | Net loss | | $ | (5,270,200 | ) | | $ | (3,725,305 | ) | | Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | | | | | Equity of loss of subsidiaries | | | 1,023,390 | | | | 2,951,525 | | | Amortization of intangible asset | | | 75,000 | | | | 75,000 | | | Stock compensation expense | | | 250,000 | | | | — | | | Gain from debt forgiveness | | | (42,581 | ) | | | — | | | Gain from voluntary waiver of compensation by related parties | | | (170,000 | ) | | | — | | | Excess of warrant fair value over offering proceeds | | | 2,896,455 | | | | — | | | Offering costs allocable to derivative liabilities | | | 12,575 | | | | — | | | Change in fair value of derivative liabilities | | | (202,959 | ) | | | (204,242 | ) | | Change in operating assets and liabilities | | | | | | | | | | Prepayments, receivables and other current assets | | | (199,143 | ) | | | 37,124 | | | Due from a related party | | | 75,000 | | | | — | | | Due to a related party | | | 78,398 | | | | — | | | Accrued expenses and other liabilities | | | (684,105 | ) | | | 201,761 | | | Net Cash Used in Operating Activities | | | (2,158,170 | ) | | | (664,137 | ) | | | | | | | | | | | | Cash Flows from Investing Activities: | | | | | | | | | | Loan to a related party | | | (229,469 | ) | | | — | | | Loan to subsidiaries | | | (1,579,028 | ) | | | — | | | Net Cash Used in Investing Activities | | | (1,808,497 | ) | | | — | | | | | | | | | | | | | Cash Flows from Financing Activities: | | | | | | | | | | Net proceeds from exercise of November 2021 Private Placement Warrants | | | 341,251 | | | | — | | | Net proceeds from issuance of common stock in PIPE Offering | | | 659,992 | | | | — | | | Net proceeds from registered direct offering of common stock and pre-funded warrants and concurrent private placement of warrants | | | 2,828,725 | | | | — | | | Repayment from subsidiaries | | | — | | | | 569,239 | | | Borrowings from related parties | | | 137,500 | | | | 74,773 | | | Net Cash Provided by Financing Activities | | | 3,967,468 | | | | 644,012 | | | | | | | | | | | | | Net increase (decrease) in cash | | | 801 | | | | (20,125 | ) | | Cash, beginning of year | | | 999 | | | | 21,124 | | | Cash, end of year | | $ | 1,800 | | | $ | 999 | |
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