China Merchants Securities Co., Ltd

About Tuojing Technology Co., Ltd

2024 Semi-Annual Continuous Supervision Follow-up Report

Tuojing Technology Co., Ltd. (hereinafter referred to as "Tuojing Technology" or the "Company") in April 2022

On the 20th, it was listed on the Science and Technology Innovation Board of the Shanghai Stock Exchange. China Merchants Securities Co., Ltd. (hereinafter referred to as "China Merchants Securities" or the "Sponsor"), as the sponsor of the continuous supervision of Tuojing Technology, is responsible for the continuation of Tuojing Technology after its listing in accordance with the Administrative Measures for the Sponsorship Business of Securities Issuance and Listing, the Rules for the Listing of Stocks on the Science and Technology Innovation Board of the Shanghai Stock Exchange, and the Administrative Measures for the Registration of Initial Public Offerings of Shares on the Science and Technology Innovation Board (for Trial Implementation).

Supervision will be carried out from 20 April 2022 to 31 December 2025.

In the first half of 2024, China Merchants Securities' continuous supervision of Tuojing Technology is summarized as follows:

1. Continue to supervise the work

Serial No. Work Content Continuous supervision

Establish and effectively implement the continuous supervision system, and for the sponsor institutions have been established, improved and effectively enforced

1. Formulate a corresponding work plan for the continuous supervision of the body. A continuous supervision system has been implemented and formulated

Corresponding work plan.

According to the relevant regulations of the China Securities Regulatory Commission, the sponsor has signed a contract with Tuojing Technology at the beginning of the continuous supervision work

2 Before, a continuous supervision agreement was signed with the listed company or relevant parties, the "Sponsorship Agreement", which clarified the double

Clarify the rights and obligations of both parties during the period of continuous supervision, and report the rights and obligations of the Shanghai securities company during the period of continuous supervision

Filing with the securities exchange. Business.

The sponsor institution communicates on a daily basis, on a regular basis

3. Through daily communication, regular return visits, on-site inspections, due diligence, etc., or irregular return visits, etc., to understand the extension

Ways to carry out continuous supervision. Jing Technology's business situation, to Tuojing Technology

Carry out continuous supervision.

During the period of continuous supervision, in accordance with the relevant regulations, listed companies violated laws and regulations in the first half of 2024

4 If the matter is publicly stated, it shall be disclosed to the Shanghai Stock Exchange during the period of continuous supervision

The report shall be reviewed by the Shanghai Stock Exchange and published in the designated media by the sponsor to make a public statement

Announcement. of violations of laws and regulations.

Serial No. Work Content Continuous supervision

During the period of continuous supervision, the listed company or relevant parties have violated the law

regulations, breach of commitments and other matters shall be discovered or should be discovered in the first half of 2024

5. Report to the Shanghai Stock Exchange within five working days, and the content of the report No violations occurred during the continuous supervision period

Including matters such as violations of laws and regulations, breach of regulations or breach of commitments by listed companies or relevant parties.

the specific circumstances of the commitment, the supervisory measures taken by the sponsor, etc.

In the first half of 2024, the Sponsor Superintendent

Supervise listed companies and their directors, supervisors, and senior managers to comply with the requirements of Tuojing Technology and its directors, supervisors, and senior management

Laws, regulations, departmental rules and business-level management personnel issued by the Shanghai Stock Exchange shall comply with laws, regulations and ministries

6. Business rules and other normative documents, and earnestly implement the rules and regulations made by it and issued by the Shanghai Stock Exchange

Commitments. business rules and other normative documents

and earnestly fulfill the items it has made

Promise.

Supervise listed companies to establish, improve and effectively implement the corporate governance system, and the sponsor supervises Tuojing Technology to comply with the phase

7 Including but not limited to, the rules of procedure of the general meeting of shareholders, the board of directors and the board of supervisors, and the improvement of the corporate governance system

and the code of conduct for directors, supervisors and senior management. degree, and strictly implement the corporate governance system.

The sponsor's internal control over Tuojing Technology

Supervise listed companies to establish, improve and effectively implement internal control systems, including the design, implementation and effectiveness of the system

However, it is not limited to the financial management system, accounting system and internal audit verification, and continuous supervision and follow-up as of this time

8 system, as well as the use of raised funds, related party transactions, external guarantees, and the date of issuance of the report, Tuojing Technology

Foreign investment, derivatives trading, control of subsidiaries and other major economic control systems comply with the requirements of relevant laws and regulations

Procedures and rules for business decision-making, etc. To the effective execution of the company, able to guarantee the company

of the specification operation.

Supervise listed companies to establish, improve and effectively implement the information disclosure system, and the sponsor urges Tuojing Technology to strictly enforce it

9. Review the information disclosure documents and other relevant documents, and have sufficient reasons to implement the information disclosure system and review the information disclosure

It is believed that the documents submitted by the listed company to the Shanghai Stock Exchange do not contain the documents and other relevant documents.

In the case of false records, misleading statements or material omissions.

Information disclosure documents for listed companies and to the China Securities Regulatory Commission, Shanghai

Other documents submitted by the stock exchange are reviewed in advance and the existence of the same

The information disclosure documents of the problem shall promptly urge the company to correct or supplement them

If the company does not correct or supplement, it shall promptly disclose the information of Tuojing Technology to the sponsor of the Shanghai Securities Exchange

10 Reported by the Exchange of Changes; The information disclosure documents of listed companies have not been reviewed in advance, and there is no response

The review shall be reported to the Shanghai Stock Exchange in a timely manner five times after the listed company fulfills its information disclosure obligations

Within a few days, the review of the relevant documents will be completed, and the existing problems will be solved.

The information disclosure documents should be corrected or supplemented by the listed company in a timely manner.

If the listed company does not correct or supplement, it shall submit it to Shanghai Securities in a timely manner

Yi reported it.

Serial No. Work Content Continuous supervision

Focus on listed companies or their controlling shareholders, actual controllers, directors, and the first half of 2024, Tuojing Technology has none

Supervisors and senior managers were subject to administrative penalties by the China Securities Regulatory Commission, and the controlling shareholder and actual controller, Tuojing

11 Disciplinary action by the Shanghai Stock Exchange or the largest shareholder, director, supervisor of the Shanghai Stock Exchange,

With a letter of concern from the regulator and urging it to improve its internal control system There was no such incident among senior management

degree, and take steps to correct it. Item.

Continue to pay attention to listed companies and controlling shareholders, actual controllers, directors, and the first half of 2024, Tuojing Technology has none

Supervisors, senior managers, etc., the performance of commitments, the controlling shareholder and actual controller of the listed company, Tuojing

12. and the controlling shareholder, actual controller, etc. who fail to fulfill their commitments, and Technology and its largest shareholder, directors and supervisors

reported to the Shanghai Stock Exchange. matters, senior management, etc. do not exist

Fulfillment of commitments.

Pay attention to the reports of public media on listed companies, and target the market in a timely manner

Rumors are verified. After verification, it was found that the listed company should exist in the first half of 2024, after the sponsorship

13. Disclosure of undisclosed material matters or non-verification of disclosed information and facts, if there is no existence, should be reported to Shanghai in a timely manner

If so, promptly urge the listed company to truthfully disclose or clarify; The situation reported by the stock exchange.

If the listed company does not disclose or clarify, it shall report to Shanghai Securities in a timely manner

Exchange Reports.

If one of the following circumstances is discovered, the listed company shall be urged to make an explanation and

Rectification within a time limit, and report to the Shanghai Stock Exchange at the same time: (1)

suspected breach of relevant business rules such as the Listing Rules; (b)

The professional opinions issued by securities service institutions and their signatories may be in the first half of 2024, Tuojing Technology

14. Violations of laws such as false records, misleading statements, or material omissions have not occurred.

regulation or other improper circumstances; (3) The company appears in the "Sponsorship

the circumstances specified in Articles 71 and 72 of the Measures;

(4) The company does not cooperate with continuous supervision; (5) Shanghai Certificate

Other circumstances that the securities exchange or the sponsor deems necessary to report.

Formulate an on-site inspection work plan for listed companies and clarify the site

Check the work requirements to ensure the quality of the on-site inspection work.

In the event of any of the following circumstances in a listed company, the sponsor should know that the sponsor has formulated an on-site inspection

or should know within 15 days from the date or the Shanghai Stock Exchange to the relevant work plan, and clear the site

Within the required time limit, conduct a special on-site inspection of the listed company: inspection work requirements.

15 (1) There is a suspicion of major financial fraud; (2) During the period of continuous supervision of the controlling share, Tuojing Technology does not

East, the actual controller, directors, supervisors or senior management personnel have the aforesaid need to conduct special on-site inspection

suspected of misappropriating the interests of a listed company; (3) There may be circumstances related to major violations.

regulatory guarantees; (4) There are material differences in capital transactions or cash flows

Often; (5) The Shanghai Stock Exchange or the sponsoring institution deems it should

When conducting on-site inspections for other matters.

2. Problems found by the sponsor and the sponsor representative and their rectification

In the first half of 2024, the sponsor and the sponsor representative did not find any major problems with Tuojing Technology.

3. Major risk matters

The main material risks faced by the Company are as follows:

(1) Core competitiveness risks

With the development and iteration of technology in the semiconductor industry, downstream customers' requirements for the performance of semiconductor equipment have also increased. Therefore, the company needs to continue to maintain a high R&D investment to maintain the core competitiveness and advanced level of products. If the company fails to follow up with the evolution needs of downstream customers' production line equipment and process technology in the future, or the technological innovation products cannot meet customer needs, it may adversely affect the company's operating results.

The company has established a scientific R&D system, technological innovation keeps up with market demand, R&D projects are guided by customer needs, and always maintain continuous and effective communication with customers to avoid possible technology R&D failures to bring losses to the company.

(2) Business risks

1. The risk of long product acceptance cycle

The technical parameters of the thin films deposited by the thin film deposition equipment directly affect the chip performance. In production, it is not only necessary to test the performance indicators such as film thickness, uniformity, optical coefficient, mechanical stress and particle size after film formation, but also to conduct reliability and life cycle tests on the final chip product after the completion of the wafer production process and chip packaging to measure whether the thin film deposition equipment ultimately meets the technical standards. As a result, fabs require a longer verification time for thin film deposition equipment. At the same time, as the company develops and launches more new products and new processes, the acceptance cycle of these new products and new processes is slightly longer than that of mature products, resulting in a delay in the company's revenue recognition and collection, which increases the company's financial pressure and affects the company's financial situation.

With the gradual expansion of the application scale of the company's products in the integrated circuit manufacturing production line, the increasingly mature technology of the company's new platform and new process products, and the efficient and stable cooperation between the company and customers, the verification cycle of the products will be shortened. The company will continue to pay attention to the company's product verification and payment collection to ensure the sustainable and healthy development of the company's operation.

2. Market competition risk

Compared with special equipment enterprises, international giants have a first-mover advantage in the client, and the company's comprehensive competitiveness is in a weak position, with a low market share. In addition, domestic semiconductor equipment manufacturers have also entered the company's business field to develop some similar products. The company faces competition from both international giants and potential new domestic entrants. If the company is unable to effectively respond to the market competition environment, the company's industry position, market share, operating performance, etc. will be adversely affected.

The company will continue to pay attention to the development of foreign competitors, through continuous and effective R&D investment to continuously shorten the technology generation gap with foreign manufacturers, at the same time, the company also pays close attention to the domestic competition pattern, continuously expands the company's product coverage, and enhances the core competitiveness of products; The company will also always pay attention to the competitive situation of the industry, scientifically and reasonably set the direction of research and development, accelerate the progress of research and development, and build a higher industry entry barrier; At the same time, the company will also maintain closer cooperation with customers to achieve common growth with downstream customers.

3. The risk that the expansion of the wafer factory is less than expected

The capacity scale of downstream wafer fabs determines the market space for semiconductor special equipment. Fab expansion investments are cyclical. If the investment intensity of downstream fabs decreases, the company will face the risk of declining market demand, which will adversely affect the company's operating performance.

The company will pay attention to the development stage of the semiconductor industry cycle at any time, coordinate the company's purchase, production and sales according to market conditions, and maintain the coordination of the company's business activities and the industry cycle; At the same time, the company will actively expand the customer base, realize the diversification of the customer structure, and avoid the material adverse impact caused by the expansion of individual customers is less than expected.

4. Supply chain security risks

In recent years, the complex international situation has exacerbated the instability of the global supply chain. At present, some of the company's parts still need to be purchased from foreign suppliers for the time being. If the international trade friction is further intensified, the above-mentioned foreign suppliers may be affected by relevant policies to reduce or stop the supply of the company's parts, which may affect the company's product production capacity, production schedule and delivery time, and reduce the company's market competitiveness.

The company actively carries out deeper and more extensive cooperation with suppliers, adopts a globalized and multi-source supply strategy, and builds stable cooperation channels to strengthen the security of its own supply chain and reduce the risk caused by the instability of the international industrial chain.

(3) Financial risks

1. Risk of changes in government subsidy policies

The government subsidies received by the Company during the reporting period were mainly to support the Company's R&D investment. If the company does not continue to receive government subsidies in the future, or if the government subsidies are significantly reduced, the company will need to invest more self-financing in R&D, which will affect the company's cash flow. In addition, the reduction of government subsidies will also have a certain adverse impact on the company's operating performance.

The company will continue to expand the scale of its business and improve profitability to gradually reduce the impact of government subsidies on the company's operating performance.

2. Risk of tax incentives

During the reporting period, the company enjoyed the relevant preferential tax policies of the state in the field of integrated circuits, and if the above-mentioned preferential tax policies of the state changed, it may face the risk of reducing profits due to the reduction or cancellation of tax incentives.

With the continuous enhancement of the company's profitability, the expansion of market share and the continuous improvement of product competitiveness, the impact of fluctuations in preferential tax policies on the company's operating performance is gradually decreasing.

(4) Industry risks

The semiconductor industry is affected by the iteration of semiconductor technology and the demand of the terminal consumer market, showing cyclical fluctuations. If the demand or development of the downstream end market is less than expected, and the supply and demand structure of the end consumption changes greatly, the downstream wafer fab will adjust its capital expenditure scale and equipment purchase volume, which will have an impact on the company's operation.

The company will pay attention to industry dynamics and prosperity fluctuations at any time, predict and coordinate the company's business activities in advance, reasonably control cash flow, and avoid major adverse effects caused by industry fluctuations.

(5) Macro environmental risks

The semiconductor equipment industry is susceptible to fluctuations in the global economic situation, and if the macroeconomic development is weak in the future, it will affect the market demand for semiconductor equipment, which will bring volatility risks to the development of the semiconductor equipment industry.

The global semiconductor industry has formed a highly monopolistic pattern, and in recent years, some countries have set up trade barriers in areas where they are strong. If the international situation deteriorates further and trade frictions further intensify, it may be half of China's half

The development of the conductor industry has had an adverse effect. The company always strictly abides by the laws of various countries, and continues to pay attention to the changes in the international trade situation and industry development trends, and formulates preventive measures in advance.

4. Major violations

In the first half of 2024, the company did not have any material violations.

5. Reasons and reasonableness of changes in major financial indicators

In the first half of 2024, the company's main financial data and indicators are as follows:

(1) Main financial data

Unit: Yuan

Key Accounting Data January-June 2024 January-June 2023 January-June 2024 Comparison

Year-on-year change (%)

Operating income 1,266,890,685.67 1,003,709,264.02 26.22

Shares attributable to listed companies 129,093,960.35 124,565,953.33 3.64

East's net profit

Attributable to shares of listed companies

East deduction non-recurring 19,957,472.69 65,182,519.13 -69.38

Net profit from profit or loss

-899,812,522.62 -742,829,155.50 from operating activities

Net gold flow

June 30, 2024

Key Accounting Data June 30, 2024 June 30, 2023 Year-on-year increase or decrease

(%)

Shares attributable to listed companies 4,560,920,520.60 4,593,860,407.52 -0.72

East's net worth

Total assets 12,473,072,407.66 9,969,345,254.15 25.11

(2) Main financial indicators

Key Financial Indicators January-June 2024 January-June 2023 January-June 2024 Comparison

Year-on-year change (%)

Basic earnings per share (RMB/0.46 0.45 2.22

shares)

Diluted earnings per share (RMB/0.46 0.45 2.22.)

shares)

After deducting non-recurring gains and losses

Basic earnings per share (RMB 0.07 0.24 -70.83

/share)

Weighted average return on equity 2.77 3.26 decreased by 0.49 percentage points

Rate (%) points

After deducting non-recurring gains and losses, this was a decrease of 1.28 percentage points

The weighted average net worth closed at 0.43 1.71 points

Profit rate (%)

R&D investment accounted for 24.81 20.93 operating income, an increase of 3.88 percentage points

Proportion (%) points

(3) Analysis of the reasonableness of changes

From January to June 2024, benefiting from the company's continuous and high-intensity R&D investment, it has been promoting product industrialization and various R&D investment

In the process of iterative upgrading of the product series, important results have been achieved, and new products and processes such as ultra-high aspect ratio trench filling CVD equipment, PE-ALDSiN process equipment, HDPCVDFSG, HDPCVDSTI process equipment have been verified and imported by downstream users, and the company's revenue has grown steadily. In the first half of 2024, the company achieved operating revenue

1266.8907 million yuan, a year-on-year increase of 26.22%; The shipment amount was 3.249 billion yuan, a year-on-year increase of 146.50%.

As of the end of June 2024, the balance of goods issued by the company was 3.162 billion yuan, which is higher than the balance of goods issued at the end of 2023

1.934 billion yuan, an increase of 63.50%, laying a good foundation for subsequent revenue growth. With the gradual improvement of the company's product layout and the continuous rise of customer recognition, the revenue of the shipment machines has been continuously converted, and the operating income in the second quarter of 2024 reached 795.101 million yuan, an increase of 32.22% year-on-year and 68.53% quarter-on-quarter.

From January to June 2024, the company achieved a net profit attributable to shareholders of listed companies of 129.094 million yuan, the same as that

The year-on-year growth rate was 3.64%, which was lower than the year-on-year growth rate of operating income, mainly due to: 1) the company continued to invest in high-intensity R&D, continuously expanded new products and new processes, including ultra-high aspect ratio trench filling CVD equipment, PECVD Bianca process equipment and bonding registration accuracy measurement products, and continued to optimize and upgrade equipment platforms and reaction chambers, including new equipment platforms (PF-300TPlus and PF-300M) and new reaction chambers (pX and Supra-D). At the same time, we will further expand the coverage of the company's products and processes, and enhance the core competitiveness of products.

R&D expenses from January to June 2024 reached 314.3134 million yuan, a year-on-year increase of 49.61%; 2) To support business regulations

Due to the rapid growth of the mold and the rapid response to customer needs, the salary and other expenses of sales personnel increased in the first half of 2024, and the sales expenses reached 159.7917 million yuan, a year-on-year increase of 39.24%. In the second quarter of 2024, the company achieved a net profit attributable to shareholders of listed companies of 118.6223 million yuan, an increase of 67.43% year-on-year and 1032.79% quarter-on-quarter.

From January to June 2024, the company achieved net profit attributable to shareholders of listed companies after deducting non-recurring gains and losses

Run 19.9575 million yuan, a year-on-year decrease of 45.225 million yuan, mainly due to the company's inclusion from January to June 2024

The government subsidy income of non-recurring gains and losses was 107.1291 million yuan, an increase of 47.9086 million yuan year-on-year. 2024

In the second quarter of the year, the company achieved a net profit attributable to shareholders of listed companies after deducting non-recurring gains and losses of 64.1667 million yuan, a year-on-year increase of 40.90%, and a significant turnaround from the previous quarter.

From January to June 2024, the company's net cash flow from operating activities was -899.8125 million yuan, a year-on-year increase

The decrease of 156.9834 million yuan was mainly due to: 1) the increase in material payment due to the substantial increase in the amount of shipments and the balance of goods issued, and the cash for purchasing goods and receiving payment for labor services in the current period was 2386.0911 million yuan, an increase of 622.7778 million yuan over the same period of last year, a year-on-year increase of 35.32%; 2) At the end of the contract liability corresponding to the advance receipt

reached 2037.607 million yuan, an increase of 656.0824 million yuan or 47.49% from the end of 2023

The cash received from the sale of goods and the provision of labor services was 1,907,986,800 yuan, an increase of 573,136,400 yuan over the same period of last year, a year-on-year increase of 42.94%. The company's net cash flow from operating activities in the second quarter of 2024 was -178.4617 million yuan, which was significantly narrower than the net cash flow of -721.3508 million yuan in the first quarter, mainly for the cash received from the sale of goods and the provision of labor services in the second quarter reached 1407.8346 million yuan, an increase of 907.6824 million yuan from the first quarter, an increase of 181.48% from the previous quarter.

Sixth, the changes in core competitiveness

The company is committed to the research and development and production of the world's leading high-end semiconductor special equipment, always adhere to independent innovation, and continue to provide competitive products for the semiconductor industry and customers. The company has established an innovative management system, formed a number of international advanced core technologies, and formed competitive advantages in R&D team, technology accumulation and R&D platform, market expansion and after-sales service, etc., which are embodied in:

(1) It has rich technical reserves and international advanced core technology advantages

Through independent research and development, the company has formed a series of original designs and built a complete intellectual property body

The department has obtained a number of independent intellectual property rights. As of the end of June 2024, the company has applied for a total of 1,279 patents

(including PCT), 402 authorized patents, including 209 invention patents.

The PECVD, ALD, SACVD, HDPCVD and ultra-high aspect ratio trench-filled CVD thin film series equipment developed and launched by the company to support different process models have been mass-produced at the client, and has accumulated a number of core technologies of R&D and industrialization in the field of semiconductor thin film deposition equipment, and has built a R&D platform with the ability to develop equipment types and process models epitaxy, and its performance has reached the international level of similar equipment.

Facing the actual needs of the domestic semiconductor manufacturing industry and the pace of production line evolution, the company has developed and launched hybrid bonding equipment applied to the field of wafer-level three-dimensional integration. The company will maintain a high level of R&D investment in the future.

Continue to iteratively upgrade and optimize existing equipment and processes, and continuously introduce new equipment and new processes for future development needs.

(2) Excellent technical research and development and management team advantages

The company has built an international and professional high-end semiconductor special equipment technology research and development and management team. Based on the research and development of core technologies, the company actively introduces senior professionals and independently cultivates scientific research teams.

The company's international and professional senior management team, employee equity incentive mechanism and competitive salary and benefits have attracted a large number of experienced domestic and foreign semiconductor equipment industry talents to join the company, and have made outstanding contributions in machine design, process development, software design and other aspects. Since its establishment, the company has independently cultivated a local scientific research team, and with the successful research and development of a number of products, the company's local scientific research team has grown into the company's technology

The backbone of R&D. As of the end of June 2024, the company has a total of 506 R&D personnel, accounting for the company's employees

40.38% of the total, 34 are doctoral students, accounting for about 6.72%, and 281 are master's students

people, accounting for about 55.53%. The company's R&D technical team has a reasonable structure, clear division of labor, deep professional knowledge reserves, and rich experience in production line verification, which is the cornerstone of the company's technical strength and ensures the market competitiveness of the company's products. From January to June 2024, the company's core technical team was stable and there were no major adverse changes.

(3) Leading industry position and abundant customer resource advantages

With the vision of "establishing the world's leading thin film equipment company", the company has become a leading enterprise in the domestic semiconductor equipment industry through the technology accumulation and rapid development of thin film deposition equipment, which is the core semiconductor equipment segment.

The company has formed a relatively stable cooperative relationship with domestic semiconductor industry enterprises. The company's PECVD, ALD, SACVD, HDPCVD and ultra-high aspect ratio trench filling CVD and other products have been sent to the production line of domestic integrated circuit wafer factories in batches. In addition, the company is actively expanding overseas markets.

(4) Stable supply chain and lower operating costs

The company has established a sound supply chain management system, absorbed and accumulated global supply chain resources, established strategic cooperative relations with key suppliers, and built a stable supply chain structure. Through the periodic evaluation and assessment of suppliers, suppliers are encouraged to improve product quality, delivery time and cost control, so as to improve the competitiveness of enterprises. The company interacts with suppliers in real time, collaborates on product innovation, and maintains a good and stable cooperative relationship.

The company's main competitors are located abroad, and the cost of serving customers in Chinese mainland is high. The company's R&D and production are mainly located in Chinese mainland, with geographical advantages. In terms of product design, the company works closely with suppliers to make products modular and easy to maintain, so as to reduce the company's raw material procurement costs. With the rapid development of upstream suppliers, the company is given more procurement options. As a result, the company has a certain advantage over its main competitors in terms of operating costs, and with the continuous improvement of production capacity, the cost reduction advantage will be more obvious.

(5) Provide customized products and efficient after-sales service advantages

The company's rapid response ability to meet the customized equipment needs of customers' production lines in a timely manner for specific process materials and film properties in specific manufacturing processes can meet the needs of customized equipment for customers' production lines, which is extremely important for downstream wafer fabs to quickly expand production capacity, thereby establishing and consolidating stable cooperative relations with customers. The production base of the company's main customers is located in Chinese mainland, compared with international competitors, the company's management and technical team are closer to the main customers, can provide efficient technical support and after-sales service, and timely guarantee and meet customer needs.

In the first half of 2024, there were no adverse changes in the company's core competitiveness.

7. Changes in R&D expenditure and R&D progress

(1) R&D expenditure and changes

From January to June 2024, the company's R&D expenditure is as follows:

Unit: Yuan

Project January-June 2024 January-June 2023 Magnitude of change (%)

Expensed R&D investment 314,313,424.99 210,085,534.71 49.61

Capitalized R&D investment - - -

Total R&D investment 314,313,424.99 210,085,534.71 49.61

The ratio of total R&D investment to operating income was 24.81 20.93, an increase of 3.88 percentage points

(%) points

Proportion of capitalization of R&D investment (%) - - -

(2) R&D progress

The company has always been deeply engaged in the field of high-end semiconductor special equipment, and focuses on thin film deposition equipment and hybrid bonds

R&D and industrialization of equipment. As of the end of June 2024, the company has successively undertaken a total of 9 national weights

Major projects/topics.

The company has a number of independent intellectual property rights and core technologies. As of the end of June 2024, the company has applied for a total of 1279 patents (including PCT) and 402 patents; From January to June 2024, the company will add a new application specialty

74 patents (including PCT) and 45 new patents.

8. Whether the progress of the new business is consistent with the information disclosed in the previous period

Not applicable.

9. The use of the raised funds and whether they are compliant

According to the Reply on Agreeing to the Registration of the Initial Public Offering of Shares of Tuojing Technology Co., Ltd. (Zheng Jian Xu Xu [2022] No. 424) issued by the China Securities Regulatory Commission, the company issued 31,619,800 RMB ordinary shares to the public for the first time, with a par value of RMB 1.00 per share, and the issue price per share was RMB

RMB 71.88, raising a total of RMB 2272.8312 million, deducting the issuance expenses of RMB 145.234 million

(excluding tax), the net proceeds amounted to RMB212,759.73 million. The above-mentioned raised funds were verified by Tianjian Certified Public Accountants (Special General Partnership) and issued the "Capital Verification Report" (Tianjian Yan [2022] No. 139).

As of June 30, 2024, the balance of the company's special account for raising funds was RMB674.9945 million.

The specific use and balance of the raised funds are as follows:

Unit: 10,000 yuan

Item Serial Number Amount

Net proceeds A 212,759.73

Project input B1 24,725.53

January-June 2024 for share repurchase amount B2 19,727.29

Amount incurred: Net interest income B3 924.90

Permanent replenishment of the remaining funds of the closed project B4 5,332.54

Funds

Project input C1 117,094.29

For share repurchase amount C2 19,727.29

Item Serial Number Amount

Net interest income as of 2024 6 C3 6,366.57

Accumulated on the 30th of the month, the remaining funds of the project will be permanently replenished

Amount of money incurred: C4 8,802.56

The balance of funds raised as of June 30, 2024 is D=A-C1- 73,502.16

C2+C3-C4

Less: Wealth Management Product Balance E 6,000.00

Less: Repurchase special securities account balance F 2.71

Balance of the account for raising funds at the end of the period G=D-E-F 67,499.45

In the first half of 2024, the deposit and use of the company's raised funds will be in line with the "Shanghai Stock Exchange Science and Technology Innovation

Rules for the Listing of Stocks on the Board, Regulatory Guidelines for Listed Companies No. 2 - Management and Use of Funds Raised by Listed Companies

and the provisions of laws, regulations and institutional documents such as the company's "Measures for the Management of Raised Funds".

The raised funds were stored in special accounts and used in special purposes, and the relevant information disclosure obligations were fulfilled in a timely manner to raise funds

The specific use of the gold is consistent with the company's disclosure, and there is no disguised change in the use of raised funds and damage to shares

In the case of East Interests, there is no illegal use of raised funds.

10. Shareholding, pledge and freezing of controlling shareholders, actual controllers, directors, supervisors and senior management personnel

Closure and reduction

As of June 30, 2024, Tuojing Technology has no controlling shareholder and actual controller, and is the largest shareholder of the company

Dongguo Integrated Circuit Industry Investment Fund Co., Ltd. holds 55,026,693 shares of the company, with a shareholding ratio

19.77% for example.

As of June 30, 2024, some of the company's directors, supervisors and senior management directly hold the company

shares, as follows:

2023 12 June 2024 2024 1- Reasons for change

Name Company Position Month 31 Direct 30 Directly Hold June Shares

Number of shares held Quantity (shares) Increase or decrease

(Shares) Volume (Shares)

Lv Guangquan Chairman, core technical personnel 740,000 1,095,200 355,200 The company's annual capital in 2023

The reserve was converted into share capital

Jiang Qian Director (January 2024 1,826,749 2,703,588 876,839 2023 Annual Qualifications of the Company

Ren), core technical personnel capital reserve to increase share capital

Liu Jing Director (appointed in January 2024 40,700 60,236 19,536 The company's 2023 annual seniority

General Manager The reserve was converted into share capital

2023 12 June 2024 2024 1- Reasons for change

Name Company Position Month 31 Direct 30 Directly Hold June Shares

Number of shares held Quantity (shares) Increase or decrease

(Shares) Volume (Shares)

Qu Xiaojun Employee Representative Supervisor (19,240 - -19,240 in 2024 Serving as Employee Representative Supervisor

January incumbency) prior to the personal reduction

Sun Lijie Deputy General Manager (January 2024 31,450 46,546 15,096 The company's 2023 annual capital

Resignation) The reserve was converted into share capital

Chen Xinyi Deputy General Manager, Core Technician 14,800 21,904 7,104 The company's 2023 annual capital

The reserve of the member capital was converted into share capital

Ning Jianping Deputy General Manager, Core Technician 14,800 21,904 7,104 The company's annual capital in 2023

The reserve of the member capital was converted into share capital

Niu Xinping Deputy General Manager (January 2024 11,100 16,428 5,328 The company's 2023 annual capital

Appointment) The reserve was converted into share capital

Xu Longxu Deputy General Manager (January 2024 13,320 19,714 6,394 The company's 2023 annual capital

Appointment) The reserve was converted into share capital

Zhao Xi Deputy General Manager (January 2024 24,050 35,594 11,544 The company's 2023 annual capital

Appointment), secretary of the board of directors The reserve was converted into share capital

Yang Xiaoqiang Head of Finance 4,440 6,571 2,131 The company's 2023 annual capital

The reserve was converted into share capital

As of June 30, 2024, the company's director (leaving in January 2024), core technical personnel Jiang

Qian and his concerted actors Lu Guangquan, Liu Yijun, Ling Fuhua, Wu Biao, Zhou Ren, Zhang Xianzhi, Zhang Xiaoyong and

Gongqingcheng Xinxinhe Investment Partnership (Limited Partnership) (hereinafter referred to as "Xinxinhe"), Gongqingcheng Xinxin

All Investment Partnership (Limited Partnership) ("Xinxinquan"), Gongqingcheng Xinxinlong Investment Partnership (Yes

Limited Partnership) ("Xin Xinlong"), Gongqingcheng Xin Xin Cheng Investment Partnership (Limited Partnership) ("Xin Xin Cheng"),

Gongqingcheng Xinxinwang Investment Partnership (Limited Partnership) ("Xinxinwang") and Gongqingcheng Xinxinsheng Investment

Partnership Enterprise (Limited Partnership) ("Xin Xinsheng"), Gongqingcheng Xin Xinyang Investment Partnership (Limited Partnership)

("Xinxinyang"), Shenyang Shengteng Investment Management Center (Limited Partnership), Shenyang Shengwang Investment Management Center

(Limited Partnership), Shenyang Shengquan Investment Management Center (Limited Partnership), Shenyang Shenglong Investment Management Center (Yes

Limited partnership) holds a total of 31,626,068 shares of the company. Among them, Xinxinhe, Xinxinquan, Xinxinlong, and Xin

Xincheng, Xinxinwang, Xinxinsheng and Xinxinyang have share pledges, as follows:

Name of shareholder Number of shares Proportion of shares Pledged shares The number of pledged shares accounts for the public

The proportion of the total shares of the company

Xinxinhe 3,024,934 1.09% 2,991,818 1.07%

Xinxin 3,023,948 1.09% 2,990,839 1.07%

Xinxinlong 3,023,664 1.09% 2,990,560 1.07%

Xinxincheng 3,023,200 1.09% 2,990,103 1.07%

Xinxinwang 3,023,159 1.09% 2,990,063 1.07%

Xinxinsheng 3,022,150 1.09% 2,989,065 1.07%

Xinyang 3,018,210 1.08% 2,985,164 1.07%

Total 21,159,265 7.60% 20,927,612 7.52%

Note: If the mantissa of the total count in the above table does not match the mantissa of the sum of the listed values, it is due to rounding

11. Other matters on which the Shanghai Stock Exchange or the sponsor institution deems it necessary to express its opinions

As of the date of issuance of this continuous supervision and follow-up report, there are no other matters that the sponsor believes should be expressed.

(No text below)