UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-41070

GRAPHJET TECHNOLOGY

(Exact name of registrant as specified in its charter)

Cayman Islands		N/A
(State or other jurisdiction of		(IRS Employer
incorporation or organization)		Identification No.)

Lot 3895, Lorong 6D
Kampung Baru Subang
Seksyen U6, Shah Alam
Selangor, Malaysia		40150
(Address of principal executive offices)		(Postal Code)

+60 016 310 0895

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A ordinary shares, par value $0.0001 per share		GTI		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). No ☒ Yes ☐

As of July 29, 2025 there were 148,037,022 shares of the Company’s Class A ordinary shares, par value $0.0001 per share, issued and outstanding.

TABLE OF CONTENTS

PART I-FINANCIAL INFORMATION
Item 1.	Unaudited Condensed Consolidated Financial Statements	1
	Unaudited Condensed Consolidated Balance Sheets	1
	Unaudited Condensed Consolidated Statements of Operations	2
	Unaudited Condensed Consolidated Statements of Comprehensive Loss	2
	Unaudited Condensed Consolidated Statements of Shareholders’ Deficit	3
	Unaudited Condensed Consolidated Statements of Cash Flows	4
	Notes To Unaudited Condensed Consolidated Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.	Quantitative and Qualitative Disclosures About Market Risk
Item 4.	Controls and Procedures	39

PART II-OTHER INFORMATION
Item 1.	Legal Proceedings	41
Item 1A.	Risk Factors	41
Item 2.	Unregistered Sales of Equity Securities, and Use of Proceeds	41
Item 3.	Defaults Upon Senior Securities	41
Item 4.	Mine Safety Disclosures	41
Item 5.	Other Information	41
Item 6.	Exhibits	42

SIGNATURES		43

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

GRAPHJET TECHNOLOGY

CONDENSED CONSOLIDATED BALANCE SHEETS

	March 31,			September 30,
	2025			2024
	(unaudited)
ASSETS
CURRENT ASSETS
Cash	$	227,828		$	348,655
Inventories		137,670			73,922
Prepaid expenses		9,057			12,200
Deposits		27,798			29,888
Other receivables		105,380			113,108
Total Current Assets		507,733			577,773

NON-CURRENT ASSETS
Property and equipment, net		1,426,900			1,593,400
Intangible assets, net		2,948			262
Operating right-of-use assets		39,658			—
Total Non-current Assets		1,469,506			1,593,662

Total Assets	$	1,977,239		$	2,171,435

LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)

CURRENT LIABILITIES
Accounts Payable	$	5,955		$	—
Loans from third parties		570,991			600,626
Other payables and accrued expenses		1,211,078			1,232,422
Loans from shareholders		447,896			358,326
Payables to shareholders		2,008,793			2,159,866
Compensation payable to a shareholder		686,282			737,894
Deferred underwriting commission payable		1,541,025			1,541,025
Provision for bonus		13,800,000			13,800,000
Operating lease liabilities, current		39,658			—
Total Current Liabilities		20,311,678			20,430,159

NON-CURRENT LIABILITIES
Total Non-current Liabilities		—			—

Total Liabilities		20,311,678			20,430,159

COMMITMENTS AND CONTINGENCIES (See Note 18)

SHAREHOLDERS’ EQUITY (DEFICIT)
Preferred share, $0.0001 par value; 1,000,000 shares authorized, no shares issued and outstanding as of March 31, 2025 and September 30, 2024		—			—
Class A ordinary share, $0.0001 par value; 479,000,000 shares authorized; 147,391,887 and 146,738,806 shares issued and outstanding as of March 31, 2025 and September 30, 2024		14,739			14,674	*
Class B ordinary share, $0.0001 par value; 20,000,000 shares authorized; no shares issued and outstanding as of March 31, 2025 and September 30, 2024		—			—
Additional paid-in capital		8,802,598			7,812,836
Accumulated deficit		(27,065,075	)		(25,798,897	)
Accumulated other comprehensive loss		(86,701	)		(287,337	)
Total Shareholders’ Deficit		(18,334,439	)		(18,258,724	)

Total Liabilities and Shareholders’ Deficit	$	1,977,239		$	2,171,435

*	Giving retroactive effect to reverse recapitalization effected on March 14, 2024 to reflect exchange ratio of approximately 55.1 as described in Note 4

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

GRAPHJET TECHNOLOGY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

	For the Three Months Ended March 31,						For the Six Months Ended March 31,
	2025			2024			2025			2024
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
				As Restated						As Restated
Revenues	$	—		$	—		$	—		$	—
Cost of revenue		—			—			—			—
Gross profit		—			—			—			—

Operating expenses:
General and administrative expenses		552,947			14,090,612			1,205,005			14,316,022
Total operating expenses		552,947			14,090,612			1,205,005			14,316,022

Loss from operations		(552,947	)		(14,090,612	)		(1,205,005	)		(14,316,022	)

Other income (expenses)
Interest expense		(13,183	)		(178,175	)		(26,828	)		(357,202	)
Other expenses, net		(10,893	)		(360	)		(34,345	)		(1,052	)
Total other expenses, net		(24,076	)		(178,535	)		(61,173	)		(358,254	)

Loss before income tax		(577,023	)		(14,269,147	)		(1,266,178	)		(14,674,276	)

Income tax expense		—			—			—			—

Net loss	$	(577,023	)	$	(14,269,147	)	$	(1,266,178	)	$	(14,674,276	)

Foreign currency translation adjustment		(26,182	)		(9,118	)		200,636			(173,969	)

Total comprehensive loss attributable to ordinary shareholders	$	(603,205	)	$	(14,278,265	)	$	(1,065,542	)	$	(14,848,245	)

Weighted average number of ordinary shares outstanding*
Basic		147,391,887			139,447,886			147,280,033			138,589,614
Diluted		147,391,887			139,447,886			147,280,033			138,589,614

Loss per share ordinary share
Basic	$	(0.01	)	$	(0.10	)	$	(0.01	)	$	(0.11	)
Diluted	$	(0.01	)	$	(0.10	)	$	(0.01	)	$	(0.11	)

*	Giving retroactive effect to reverse recapitalization effected on March 14, 2024 to reflect exchange ratio of approximately 55.1 as described in Note 4

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

GRAPHJET TECHNOLOGY

CONDENSED CONSOLIDATED STATEMENTS OF CHANGE IN SHAREHOLDERS’ EQUITY

(DEFICIT)

	Preferred Share				Class A Ordinary Share (Restated)				Class B Ordinary Share				Additional paid-in capital			Accumulated Deficit			Accumulated other comprehensive
	Shares		Amount		Shares*		Amount		Shares		Amount		(Restated)			(Restated)			income (loss)			Total
BALANCE, September 30, 2023		—	$	—		137,750,000	$	13,775		—	$	—	$	587,499		$	(7,983,590	)	$	54,003		$	(7,328,313	)
Net loss		—		—		—		—		—		—		—			(405,129	)		—			(405,129	)
Foreign currency translation		—		—		—		—		—		—		—			—			(164,851	)		(164,851	)
BALANCE, December 31, 2023 (unaudited)		—	$	—		137,750,000	$	13,775		—	$	—	$	587,499		$	(8,388,719	)	$	(110,848	)	$	(7,898,293	)
Issuance of ordinary shares upon completion of reverse recapitalization		—		—		6,688,806		669		—		—		(1,933,408	)		—			—			(1,932,739	)
Issuance of ordinary shares for PIPE investment		—		—		250,000		25		—		—		2,499,975			—			—			2,500,000
Loan payment converted to shares		—		—		2,050,000		205		—		—		8,199,795			—			—			8,200,000
Net loss		—		—		—				—		—		—			(14,269,147	)		—			(14,269,147	)
Foreign currency translation		—		—		—				—		—		—			—			(9,118	)		(9,118	)
BALANCE, March 31, 2024 (unaudited)		—	$	—		146,738,806	$	14,674		—	$	—	$	9,353,861		$	(22,657,866	)	$	(119,966	)	$	(13,409,297	)

BALANCE, September 30, 2024		—	$	—		146,738,806	$	14,674		—	$	—	$	7,812,836		$	(25,798,897	)	$	(287,337	)	$	(18,258,724	)
Sales of ordinary shares		—		—		653,081		65		—		—		989,762			—			—			989,827
Net loss		—		—		—		—		—		—		—			(689,155	)		—			(689,155	)
Foreign currency translation		—		—		—		—		—		—		—			—			226,818			226,818
BALANCE, December 31, 2024 (unaudited)		—	$	—		147,391,887	$	14,739		—	$	—	$	8,802,598		$	(26,488,052	)	$	(60,519	)	$	(17,731,234	)
Net loss		—		—		—		—		—		—		—			(577,023	)		—			(577,023	)
Foreign currency translation		—		—		—		—		—		—		—			—			(26,182	)		(26,182	)
BALANCE, March 31, 2025 (unaudited)		—	$	—		147,391,887	$	14,739		—	$	—	$	8,802,598		$	(27,065,075	)	$	(86,701	)	$	(18,334,439	)

*	Giving retroactive effect to reverse recapitalization effected on March 14, 2024 to reflect exchange ratio of approximately 55.1 as described in Note 4

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

GRAPHJET TECHNOLOGY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the Six Months Ended March 31,
	2025			2024
	(unaudited)			(unaudited)
				As Restated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(1,266,178	)	$	(14,674,276	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization		74			51
Depreciation		84,400			1,611
Amortization of operating lease right-of-use assets		22,856			—
Change in operating assets and liabilities:
Prepaid expenses		2,296			51,875
Advance to a related company		—			4,458
Inventories		(69,083	)		—
Deposits		—			(25,686	)
Other receivables		(184	)		(87,832	)
Accounts Payable		5,969			—
Interests payable		28,905			11,644
Other payables and accrued expenses		65,007			(252,623	)
Provision for bonus		—			13,800,000
Operating lease liabilities		(22,856	)		—
Net cash used in operating activities		(1,148,794	)		(1,170,778	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		(29,221	)		(1,266,837	)
Purchases of intangible assets		(2,785	)		—
Net cash used in investing activities		(32,006	)		(1,266,837	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from short-term loans - related party		98,406			—
Proceeds from long-term debt - related party		—			2,209,863
Repayments to long-term debt - related party		—			(106,141	)
Payments of deferred merger costs		—			(919,446	)
Proceeds from the completion of reverse recapitalization		—			1,231
Proceeds from PIPE investment		—			2,500,000
Proceeds from issuance of ordinary shares		989,827			—
Net cash provided by financing activities		1,088,233			3,685,507

Effect of exchange rate changes		(28,260	)		(102,981	)

NET CHANGE IN CASH		(120,827	)		1,144,911

Cash, beginning of the period		348,655			1,430

Cash, end of the period	$	227,828		$	1,146,341

SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for income tax	$	—		$	—
Cash paid for interest	$	—		$	—
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Issuance of ordinary share upon the reverse recapitalization	$	—		$	1,932,739
Reclassification of deferred merger costs to additional paid-in capital	$	—		$	704,334
Issuance of shares for the settlement of amount due to shareholders	$	—		$	8,200,000
Operating lease assets obtained in exchange for operating lease liabilities	$	62,608			—

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

GRAPHJET TECHNOLOGY

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIODS ENDED MARCH 31, 2025 AND 2024

(In U.S. dollars, unless stated otherwise)

Note 1 - Description of Organization and Business Operations

1.1 Organization and Nature of Business

Graphjet Technology (the “Company”, “we,” “us” or “our”) is the owner of the state-of-the-art patented technology for the manufacture of graphene and graphite. The Company is a former blank check company incorporated in the Cayman Islands on August 6, 2021 under the name Energem Corp. (“Energem”) and formed for the purpose of acquiring, engaging in a share exchange, share reconstruction and amalgamation with, purchasing all or substantially all of the assets of, entering into contractual arrangements with, or engaging in any other similar business combination with one or more businesses.

The Company acquired Graphjet Technology Sdn. Bhd. (“Graphjet”), a Malaysian based company that produces graphite, graphene and graphene-based anode battery material. The breakthrough technology transforms a sustainable, abundant and renewable agricultural waste product, palm kernel shells into highly valued artificial graphene and graphite at significantly lower carbon emissions. For research and development in graphite and graphene applications, Graphjet collaborates with National University of Malaysia (UKM) and University Teknikal Malaysia Melaka (UTEM) as Technology Advisor Panel to provide technology advisory for the applications. The Company is a member of Industrial Liaison Program (ILP) of Massachusetts Institute of Technology (MIT).

The Company intends to be a low-cost producer of the highest quality artificial graphite and graphene. Graphjet has a patent on its bio-mass process and production method for graphite and a patent pending for graphene, and it believes it is the only producer currently capable of using biomass to produce graphite and graphene in mass production scale.

Since Graphjet Technology uses a widely available waste product as their source, they are able to produce a higher quality product at a significantly lower cost than other graphite and graphene production methods currently in use worldwide.

To date of this filing, Graphjet has not had any sales of its graphite and graphene products but plans to sample the products to multinational companies within the industry for market acceptance and procurement purposes, intending to replace current high-cost suppliers. Until now, the Company has funded its operations primarily with proceeds through equity investments from its current shareholders. Starting from June 2025, Graphjet has generated some revenues from selling its side products to fund its operations as well.

1.2 Business Combination

On March 14, 2024 (the “Closing date”), Graphjet consummated a merger (the “Merger”) with Energem. Pursuant to the Business Combination Agreement, (i) Energem acquired all of the issued and outstanding Graphjet Pre-Transaction Shares from the Selling Shareholders and Graphjet became a wholly-owned subsidiary of Energem, (ii) Energem changed its name to Graphjet Technology, and (iii) each Selling Shareholder received a number of Energem Class A Ordinary Shares subject to the Consideration Shares formula, which is the number of Energem Class A Ordinary Shares equal to the aggregate Consideration Shares divided by the number of Graphjet Pre-Transaction Shares outstanding immediately prior to the Closing, multiplied by the number of Graphjet Pre-Transaction Shares held by such Selling Shareholder.

The Business Combination (see Note 4) was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Graphjet Technology was treated as the acquired company and Graphjet was treated as the acquirer for financial statement reporting purposes.

Pursuant to ASC 805-40 Reverse Acquisitions, for financial accounting and reporting purposes, Graphjet was deemed the accounting acquirer with Graphjet Technology being treated as the accounting acquiree, and the Merger was accounted for as a reverse recapitalization (the “Reverse Recapitalization”). Accordingly, the audited consolidated financial statements of the Company represent a continuation of the financial statements of Graphjet, with the Merger being treated as the equivalent of Graphjet issuing stock for the net assets of Graphjet Technology, accompanied by a recapitalization. The net assets of Graphjet Technology were stated at historical costs, with no goodwill or other intangible assets recorded, and were consolidated with Graphjet financial statements on the Closing Date. The number of Graphjet ordinary shares for all periods prior to the Closing Date have been retrospectively increased using the exchange ratio that was established in accordance with the Merger Agreement (the “Exchange Ratio”).

1.3 Acquisition of Subsidiary

In April 2024, the Company’s subsidiary, Graphjet acquired 100% equity interest in GTI US Corp, incorporated in Nevada for a consideration of $10,000. As of March 31, 2025, $5,000 consideration was paid and the balance remains as payable. GTI US Corp is still dormant as of March 31, 2025.

Note 2 - Going Concern and Liquidity

In assessing the Company’s ability to continue as a going concern, the Company monitors and analyses its cash on-hand and its operating and capital expenditure commitments. The Company’s liquidity needs are to meet its working capital requirements, operating expenses, and capital expenditure obligations.

The Company’s management has considered whether there is substantial doubt about its ability to continue as a going concern due to the Company incurred a net loss of $1,266,178 during the six months ended March 31, 2025 and, as of that date, the Company had a negative working capital of $19,803,945. These conditions raise doubt about the Company’s ability to continue as a going concern.

To sustain its ability to support the Company’s operating activities and to alleviate the situation, the Company considered supplementing its sources of funding through the following:

●

other available sources of financing from banks and other financial institutions or private lenders;

●

and equity financing.

On April 30, 2025, the Company signed debt settlement agreements with its director and shareholder to settle the debts with them.

The Company can make no assurances that required financings will be available for the amounts needed, or on terms commercially acceptable to the Company, if at all. If one or all of these events does not occur or subsequent capital raises are insufficient to bridge financial and liquidity shortfall, there would likely be a material adverse effect on the Company and would materially adversely affect its ability to continue as a going concern.

As such, the Company’s management has determined that the factors discussed above have raised substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the consolidated financial statements are issued. The unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern and, accordingly, do not include any adjustments that might result from the outcome of this uncertainty.

Note 3 - Summary of Significant Accounting Policies

Basis of presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) pursuant to the rules and regulations of the Securities Exchange Commission (“SEC”). Certain information or footnote disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair statement of the financial position, operating results and cash flows for the periods presented. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the full year or any future interim period. The interim unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the years ended September 30, 2024 and 2023.

Principles of consolidation

The unaudited condensed consolidated financial statements include the financial statements of the Company and its wholly owned subsidiaries, Graphjet and GTI US Corp. All intercompany balances and transactions, and any unrealized income and expenses arising from intercompany transactions, are eliminated in preparing the unaudited condensed consolidated financial statements.

Use of estimates and assumptions

The preparation of unaudited condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of expenses during the reporting period and the accompanying notes, including allowance for expected credit losses, the useful lives of property and equipment, and impairment of long-lived assets.

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.

Foreign currency

In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. Shareholders’ equity account is translated at historical exchange rate. Transaction gains and losses are recognized in the Company’s Unaudited Condensed Consolidated Statement of Operations and Comprehensive Loss based on the difference between the foreign exchange rates on the transaction date and on the reporting date. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income (loss) within the statements of shareholders’ equity. Cash flows are also translated at average translation rates for the periods; therefore, amounts reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets.

For Graphjet, Malaysian Ringgit (“RM”) has been determined to be the functional currency. Translation of foreign currencies into US$1 have been made at the following exchange rates for the respective periods:

	As of March 31,		As of September 30,
	2025		2024
Period-end RM: US$1 exchange rate		4.4320		4.1220

	For the six months ended March 31,
	2025		2024
Period-average RM: US$1 exchange rate		4.4215		4.7107

Cash

Cash primarily consists of bank deposits, which are unrestricted as to withdrawal and use.

Inventories

Inventories are measured at the lower of cost and net realizable value.

The cost of inventories is calculated using the weighted average method, and includes the cost incurred in acquiring the inventories and incidental cost in bringing them to their existing location and condition. For work-in-progress, cost of production comprised the costs of raw material, packaging material, manufacturing overhead and direct labor, which are allocated to products based on normal operating capacity. As of March 31, 2025 and September 30, 2024, the Company had $137,670 and $73,922 work-in-progress, respectively.

Prepaid expenses

Prepaid expenses represent amounts advanced to suppliers for goods or services that will be received in the future. Certain suppliers require advance payments when the orders are placed, and the prepaid expenses will be utilized to offset the Company’s future payments. These amounts are unsecured, non-interest bearing and generally short-term in nature.

Other receivables

Other receivables primarily include receivables from employee advances and others. Management regularly reviews the aging of the accounts and changes in payment trends and records provision for credit losses when management believes collection of amounts due are at risk. Accounts considered uncollectable are written off against allowances after exhaustive efforts at collection are made. As of March 31, 2025 and September 30, 2024, the Company provided no provision for credit losses, respectively.

Property and equipment, net

Property and equipment are stated at historical cost less accumulated depreciation. Expenditures for major renewals and betterments are capitalized, while minor replacements, maintenance, and repairs, which do not extend the asset lives, are charged to operations as incurred. Upon sale or disposition, the cost and related accumulated depreciation is removed from the accounts, and any difference between the selling price and net carrying amount is recorded as a gain or loss in the consolidated statements of operations and comprehensive loss. Depreciation on property and equipment is calculated using the straight-line method over the estimated useful lives of the assets.

Impairment for long-lived assets

Long-lived assets, including property and equipment and intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, the Company would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. As of March 31, 2025 and September 30, 2024, no impairment of long-lived assets was recognized.

Warrants

The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480, Distinguishing Liabilities from Equity (“ASC 480”), and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own Common Stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of equity at the time of issuance. The Company determined that upon further review of the warrant agreements, the Company concluded that its warrants qualify for equity accounting treatment.

Upon completion of the Business Combination, all of Graphjet’s outstanding public and private warrants (See Note 15) were replaced by the Company’s public and private warrants. The Company treated such warrants replacement as a warrant modification and no incremental fair value was recognized.

Fair value of financial instruments

Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:

●

Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets;

●

Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and

●

Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

Operating Leases

Effective July 1, 2021, the Company adopted FASB ASU 2016-02, “Leases” (Topic 842), and elected the practical expedients that does not require us to reassess: (1) whether any expired or existing contracts are, or contain, leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. For lease terms of twelve months or fewer, a lessee is permitted to make an accounting policy election not to recognize lease assets and liabilities. The Company determines if a contract contains a lease at inception. US GAAP requires that the Company’s leases be evaluated and classified as operating or finance leases for financial reporting purposes. The right-of-use assets and related lease liabilities are recognized at the lease commencement date. The Company recognizes operating lease expenses for lease payments on a straight-line basis over the lease term.

Operating lease right-of-use of assets

The right-of-use of asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and less any lease incentive received.

Lease liabilities

Lease liability is initially measured at the present value of the outstanding lease payments at the commencement date, discounted using the Company’s incremental borrowing rate. The Company’s incremental borrowing rate is the estimated rate the Company would be required to pay for a collateralized borrowing equal to the total lease payments over the term of the lease. Lease payments included in the measurement of the lease liability comprise fixed lease payments.

Lease liability is measured at amortized cost using the effective interest rate method.

It is re-measured when there is a change in future lease payments, if there is a change in the estimate of the amount expected to be payable under a residual value guarantee, or if there is any change in the Company’s assessment of option purchases, contract extensions or termination options.

The Company reviews the impairment of its ROU assets consistent with the approach applied for its other long-lived assets. The Company reviews there coverability of its long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash flows of the related operations. The Company has elected to include the carrying amount of operating lease liabilities in any tested asset group and includes the associated operating lease payments in the undiscounted future pre-tax cash flows. For the three and six months ended March 31, 2025, the Company did not recognize impairment loss on its operating lease ROU assets.

Income taxes

The Company complies with the accounting and reporting requirements of ASC Topic 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC Topic 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company’s management determined Cayman Islands, the United States and Malaysia are the Company’s only major tax jurisdictions. The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if any, as income tax expense. There were no unrecognized tax benefits as of March 31, 2025 and September 30, 2024, and no amounts accrued for interest and penalties. The Company is currently not aware of any issues under review that could result in significant payments, accruals, or material deviation from its position.

The Company is an exempted Cayman Islands company with no connection to any other taxable jurisdiction and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands. In Malaysia and Nevada US, current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the end of the reporting period, and any adjustment to tax payable in respect of previous years. Due to operating losses, the Company’s tax provision was nil for the six months ended March 31, 2025 and 2024.

Comprehensive income (loss)

Comprehensive income (loss) consists of two components, net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) refers to revenue, expenses, gains and losses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net income (loss). Other comprehensive income (loss) consists of a foreign currency translation adjustment resulting from the Company not using the U.S. dollar as its functional currencies.

Loss per share

The Company complies with accounting and disclosure requirements of ASC Topic 260, “Earnings Per Share.” Net loss per share is computed by dividing net loss by the weighted average number of ordinary shares outstanding during the period, excluding ordinary shares subject to forfeiture. For the three and six months ended March 31, 2025 and 2024, the calculation of diluted loss per share does not consider the effect of the warrants issued in connection with the Initial Public Offering and warrants issued as components of the Private Placement Units (the “Placement Warrants”) since the exercise of the warrants are contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. There are no other potential dilutive securities outstanding for the three and six months ended March 31, 2025 and 2024, as a result, diluted loss per share is the same as basic loss per share for the periods presented.

Related parties

A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.

Recent issued accounting standards

The Company is an “emerging growth company” (“EGC”) as defined in the Jumpstart Our Business Startup Act of 2012 (the “JOBS Act”). Under the JOBS Act, EGC can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies.

In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” which expands annual and interim disclosure requirements for reportable segments. These requirements include: (i) disclosure of significant expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of segment profit or loss (collectively referred to as the “significant expense principle”); (ii) disclosure of an amount for other segment items (equal to the difference between segment revenue less segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss) by reportable segment and a description of their composition; (iii) annual disclosure of a reportable segment’s profit or loss and assets currently required by Topic 280 in interim periods; (iv) clarification that, if the CODM uses more than one measure of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources, a public entity may report those additional measures of segment profit or loss; (v) disclosure of the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) disclosure of segment profit or loss in assessing segment performance and deciding how to allocate resources; and (vi) requiring a public entity that has a single reportable segment provide all the disclosures required by the amendments in this ASU, and all existing segment disclosures in Topic 280. ASU 2023-07 is effective for the Company’s annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025. The Company adopted ASU 2023-07 in the year ended September 30, 2024, and applied the amendments retrospectively to all prior periods presented in these consolidated financial statements. Refer to Note 17 segment information.

In December 2023, the FASB issued Accounting Standards Update No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign). ASU 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes. The guidance is effective for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued Accounting Standards Update No. 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”), which requires additional disclosures about specific types of expenses included in the expense captions presented on the face of the financial statements. The guidance is effective for fiscal years beginning after December 15, 2026 and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The guidance may be applied either: (1) prospectively to financial statements issued for reporting periods after the effective date, or (2) retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the potential impact of adopting this new guidance on its unaudited condensed consolidated financial statements and related disclosures.

Except as mentioned above, the Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets, statements of operations and comprehensive loss and statements of cash flows.

Note 4 — Reverse Recapitalization

Upon the consummation of the Business Combination, the following transactions were completed, based on the Company’s capitalization as of March 14, 2024:

(i)

All Energem public shares of 323,231, and all Energem founder shares of 3,403,075 remained outstanding.

(ii)

2,760,000 shares to Energem’s financial advisor

(iii)

All 2,500,100 issued and outstanding shares of Graphjet were converted into 137,750,000 shares

(iv)

202,500 shares to underwriter in connection with the Transactions.

The following table presents the number of the Company’s ordinary shares issued and outstanding immediately following the Reverse Recapitalization (as defined below):

	Ordinary
	Share
Energem’s ordinary shares outstanding prior to Reverse Recapitalization		4,430,622
Less: redemption of Energem’s ordinary shares		(704,316	)
Ordinary shares issued to underwriter		202,500
Ordinary shares issued to financial advisor		2,760,000
Total ordinary shares issued upon completion of reverse recapitalization		6,688,806
Conversion of Graphjet’s ordinary shares		137,750,000
Total ordinary shares issued and outstanding upon completion of reverse recapitalization		144,438,806

Graphjet was determined to be the accounting acquirer given Graphjet effectively controlled the combined entity after the Transactions. The transaction is accounted for as a reverse recapitalization (“Reverse Recapitalization”), which is equivalent to the issuance of ordinary shares by Graphjet for the net monetary assets of Energem, accompanied by a recapitalization. Graphjet is determined as the accounting acquirer and the historical financial statements of Graphjet became the Company’s historical financial statements, with retrospective adjustments to give effect of the Reverse Recapitalization. The net assets of Energem were recognized as of the closing date at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Business Combination are those of Graphjet and Graphjet’s operations are the only ongoing operations of the Company.

In connection with the Reverse Recapitalization, the Company raised approximately $1,200 of proceeds, presented as cash flows from financing activities.

The following table reconcile the elements of the Reverse Recapitalization to the consolidated statements of cash flows and the changes in shareholders’ deficit:

	March 14,
	2024
Funds held in Energem’s trust account	$	3,760,259
Funds held in Energem’s operating cash account		1,231
Less: payments of transaction costs incurred by Energem		(3,760,259	)
Proceeds from the Reverse Recapitalization		1,231
Less: non-cash net deficit assumed from Energem		(3,474,995	)
Net distributions from issuance of ordinary shares upon the Reverse Recapitalization	$	(3,473,764	)

The shares and corresponding capital amounts and all per share data related to Graphjet’s outstanding ordinary share prior to the Reverse Recapitalization have been retroactively adjusted using the Exchange Ratio of 55.1.

Note 5 – Deposits

Deposit allocation	Nature	As of March 31, 2025 (unaudited)		As of September 30, 2024

Public relations consulting services	Refundable		27,076		29,112
Photocopiers rented for offices use	Refundable		722		776
Total deposits		$	27,798	$	29,888

Note 6 – Property and Equipment

Property and equipment included in continuing operations consist of the following:

	As of March 31,			As of September 30,
	2025			2024
	(unaudited)
Office equipment	$	16,909		$	13,298
Renovation		148,250			153,886
Plant and Machinery		1,374,387			1,456,801
Subtotal		1,539,546			1,623,985
Less: accumulated depreciation		(112,646	)		(30,585	)
Total property and equipment, net	$	1,426,900		$	1,593,400

Depreciation of property and equipment is computed on a straight-line basis over its estimated useful life at the following annual rates:

Office equipment	20	%
Renovation	20	%
Plant and machinery	10	%

Depreciation expense amounted to $42,316 and $1,476 for the three months ended March 31, 2025 and 2024, respectively, and $84,400 and $1,611 for the six months ended March 31, 2025 and 2024, respectively, which have been recorded in general and administrative expenses in the unaudited condensed consolidated statements of operations.

Note 7 – Loans from Third Parties

The Company obtained loans of $496,390 (RM 2,200,000) from external parties Mr. Goh Meng Keong and Mr. Goh Seng Wei, to fund the acquisition of Graphene Patent, and in return they charged the Company with interest, in accordance with arm’s length transaction principle. For the three months ended March 31, 2025 and 2024, there were interest expenses of $6,098 and $5,793, respectively. For the six months ended March 31, 2025 and 2024, there were interest expenses of $12,405 and $11,644, respectively. The principal amount, maturity date and interest rate for the loans are shown below:

	March 31,		September 30,
	2025		2024
	(unaudited)
Total interest payable	$	74,601	$	66,905
Total debt and interest payable	$	570,991	$	600,626

Lender	Principle		Interest rate	Lending date	Due date
Goh Meng Keong	$	451,264	5% p.a	March 22, 2022	September 30, 2025
Goh Seng Wei	$	45,126	5% p.a	May 26, 2022	Due on demand

Note 8 – Other Payables and Accrued Liabilities

	March 31, 2025 (unaudited)		September 30, 2024
Payroll payable	$	348,314	$	282,461
Rental payable		89,801		70,354
Professional fees		475,509		574,713
Accrued expenses		295,536		304,894
Customer deposit		1,918		—
Total other payables and accrued liabilities	$	1,211,078	$	1,232,422

Note 9 – Deferred Underwriting Commission Payable

On December 21, 2023, the Company entered into a Satisfaction and Discharge of Indebtedness Agreement (the “Agreement”) with its underwriter in satisfaction of the $4,025,000 Deferred Underwriting Commission pursuant to the Underwriting Agreement dated November 15, 2021. In lieu of the Company tendering the full amount of the Deferred Underwriting Commission in cash, the underwriter agreed to accept: (1) $2,000,000 in cash at the time of the closing of the Business Combination, and (2) 202,500 unregistered ordinary shares of the Company (“Ordinary Shares”), which when multiplied by the $10.00 per share price agreed to between the Company and the underwriter (the “Agreed Share Price”) equals $2,025,000 (the “Original Aggregate Share Value”), to be issued and delivered to the underwriter at the closing of the Business Combination. Pursuant to Section 2.1 of the Agreement, the Company agreed to perform the following post-closing covenants if the lowest of the VWAP for a period of five (5) trading days immediately prior to the effectiveness date of the registration statement or prior to eligible date for release pursuant to Rule 144 is lower than the Agreed Share Value, the Company should compensate the underwriter either in cash or issuing additional ordinary shares in an amount equal to the difference between the aggregate VWAP value on any given date and the Original Aggregate Share Value (the “True-Up Obligation”).

As of September 30, 2024, the Company had finalized the settlement of the True-Up Obligation by agreeing to issue 645,135 ordinary shares to the underwriter. However, because the shares had not yet been legally issued as of the reporting date, the Company recorded a liability of approximately $1.5 million, representing the fair value of the shares to be issued. Upon issuance of the shares on May 22, 2025, the liability was reclassified to additional paid-in capital, with no income statement impact.

Note 10 – Provision for Bonus

On February 29, 2024, the Board of Directors of Graphjet approved the proposed bonus plan to reward the senior management team of Graphjet for the successful business combination and corporate listing. The total provision made is $13,800,000 according to the plan.

Note 11 – Short-term Loans - Related Parties

Loans from shareholders

(1). On August 4, 2024, August 15, 2024 and October 25, 2024, the Company entered three loan agreements with Mr. Aw Jeen Rong for working capital purpose. Aw Jeen Rong owned 5.8% and 6.0% of the Company’s ordinary shares as of March 31, 2025 and September 30, 2024, respectively. The loans are unsecured, with interest bearing of 8% per annum and fixed term of repayment. As of March 31, 2025, total loans drawdown was $284,296. For the three and six months ended March 31, 2025, there were interest expense of $5,589 and $11,095, respectively. The principal amount, maturity date and interest rate for the loans are shown in the table below:

Lender	Principal		Interest Rate	Lending Date	Due
Aw Jeen Rong*	$	99,278	8% p.a	August 4, 2024	February 4, 2025 (extended to April 30, 2026)
Aw Jeen Rong*	$	135,379	8% p.a	August 15, 2024	February 15, 2025 (extended to April 30, 2026)
Aw Jeen Rong*	$	49,639	8% p.a	October 25, 2024	April 30, 2026

	March 31,		September 30,
	2025		2024
	(unaudited)
Total interest payable	$	13,063	$	2,145
Total debt and interest payable		297,359		254,449

* Mr. Aw Jeen Rong resigned as director of Graphjet on March 14, 2025, and his balance as of September 30, 2024 was reclassified from loan from a director to loan from a shareholder to conform to the current year’s presentation.

(2). On September 4, 2024 and November 5, 2024, the Company entered two loan agreements with Mr. Liu Yu for working capital purpose. Liu Yu owned 24.7% and 24.3% of the Company’s ordinary shares as of March 31, 2025 and September 30, 2024, respectively. The loan is unsecured, with interest bearing of 8% per annum and fixed term of repayment. As of March 31, 2025, total loan drawdown was $144,765. For the three and six months ended March 31, 2025, there were interest expense of $2,848 and $5,405, respectively. The principal amount, maturity date and interest rate for the loans are shown in the table below:

Lender	Principal		Interest Rate	Lending Date	Due
Liu Yu	$	96,232	8% p.a	September 4, 2024	March 5, 2025 (extended to April 30, 2026)
Liu Yu	$	48,533	8% p.a	November 5, 2024	April 30, 2026

	March 31,		September 30,
	2025		2024
	(unaudited)
Total interest payable	$	5,772	$	408
Total debt and interest payable		150,537		103,877

Payables to shareholders

Mr. Lim Hooi Beng and Mr. Aw Jeen Rong are the shareholders of the Company.

	March 31,		September 30,
	2025		2024
	(unaudited)
Lim Hooi Beng*	$	2,002,024	$	2,152,588
Aw Jeen Rong		6,769		7,278
Payables to shareholders	$	2,008,793	$	2,159,866

* Mr. Lim Hooi Beng resigned as director of Graphjet on May 5, 2025.

Mr. Lim Hooi Beng and Mr. Aw Jeen Rong own 12.1% and 5.8% of the ordinary shares of the Company as of March 31, 2025. Mr. Lim Hooi Beng and Mr. Aw Jeen Rong own 13.8% and 6.0% of the ordinary shares of the Company as of September 30, 2024. The shareholders will continue to support the Company; hence the payables are interest free and demands for repayment are not expected within the next 12 months.

On March 11, 2024, the Company entered into the debt-to-equity conversion agreements with Mr. Lim Hooi Beng. The Company issued 775,000 ordinary shares at $4.00 per share amounting $3,100,000 to partially settle the outstanding balance. The fair value of those ordinary shares was $2.7 per share, and the difference between the share price per agreement and the fair value is considered as shareholder contribution and charged to additional paid-in-capital.

Compensation payable to a shareholder

On March 10, 2022, Graphjet entered into Intellectual Property Sales Agreement with Mr. Liu Yu, as supplemented by the letter from Mr. Liu Yu to Graphjet dated July 29, 2022, pursuant to which Graphjet purchased the process for producing palm-based graphene, an intellectual property held by Mr. Liu Yu for approximately $6.3 million payable within the 19th to 36th month period from July 29, 2022. Liu Yu owned 24.7% and 24.3% of the Company’s ordinary shares as of March 31, 2025 and September 30, 2024, respectively. The transfers of IP to the Company by Mr. Liu Yu in exchange for stock prior to or at the time of the company’s IPO through merging with a US SPAC should be recorded at the transferors’ historical cost. Based upon the Company’s records, there is no historical basis of the IP. The excess paid over the IP carrying basis of approximately $6.3 million should be charged as a compensation payable in accordance with ASC 805-50-30-5.

As of September 30, 2022, the Company repaid approximately $0.5 million in cash to Mr. Liu Yu. On March 11, 2024, the Company entered the debt-to-equity conversion agreements with Mr. Liu Yu. The Company issued 1,275,000 ordinary shares at $4.00 per share amounting $5,100,000 to partially settle the outstanding balance. The fair value of those ordinary shares was $2.7 per share, and the difference between the share price per agreement and the fair value is considered as shareholder contribution and charged to additional paid-in-capital.

The approximately $5.8 million outstanding compensation payable was discounted at an imputed interest rate of 12% per annum, and the amortization expense of debt discount is included in the interest expenses. During the three and six months ended March 31, 2024, the Company recorded $172,382 and $345,558 interest expense for the amortization, respectively. As of March 31, 2025 and September 30, 2024, the outstanding balance on the payable is $686,282 and $737,894, respectively.

Note 12 – Income Taxes

Cayman Islands

Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends to the shareholders, no Cayman Islands withholding tax will be imposed.

USA

GTI US Corp is incorporated in the United States and is subject to a federal tax rate of 21%. GTI US Corp is still dormant as of March 31, 2025.

Malaysia

The Company’s subsidiary Graphjet was incorporated in Malaysia and is subject to Malaysian Profits Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Malaysian tax laws. The applicable tax rate is 24% in Malaysia.

To date, Graphjet Technology has not had any sales of its products, the Company’s tax provision was zero for the three and six months ended March 31, 2025 and 2024. As of March 31, 2025 and September 30, 2024, the Company’s deferred tax asset had a full valuation allowance recorded against it. The effective tax rate for the three and six months ended March 31, 2025 and 2024 was 0%.

The components of the Company’s income tax provision were as follows for the period indicated:

For the three months
ended
March 31,
2025 (unaudited)

For the three months
ended
March 31,
2024 (unaudited)

For the six months
ended
March 31,
2025 (unaudited)

For the six months
ended
March 31,
2024 (unaudited)

Current

—

Deferred

—

Total income tax expense

—

The following table sets forth the significant components of the aggregate deferred tax assets and liabilities of the Company as of:

	March 31, 2025 (unaudited)			September 30, 2024

Deferred Tax Assets:
Net operating loss carry-forwards	$	4,772,459		$	4,406,475
Capital allowances		150,379			105,298
Less: valuation allowance		(4,922,838	)		(4,511,773	)
Deferred tax assets, net		—			—
Deferred tax liabilities:
Capitalized R&D expenses		—			—
Deferred tax (liabilities) assets, net	$	—		$	—

Movement of valuation allowance:

	March 31, 2025 (unaudited)		September 30, 2024

Balance at beginning of the year	$	4,511,773	$	281,826
Addition		411,065		4,229,947
Balance at end of the year	$	4,922,838	$	4,511,773

As of March 31, 2025 and September 30, 2024, the Company had net operating losses carry forward of approximately $19.9 million and approximately $18.3 million, respectively, from the Company’s Malaysian subsidiary, which can be carried forward ten years to offset taxable income.

Valuation allowance is provided against deferred tax assets when the Company determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Company considered factors including future taxable income exclusive of reversing temporary differences and tax loss carry forwards. If events occur in the future that allow the Company to realize part or all of its deferred income tax, an adjustment to the valuation allowances will result in a decrease in tax expense when those events occur.

Due to the limited operating history of the Malaysian subsidiary, the Company is uncertain when these net operating losses can be utilized. As a result, the Company provided a 100% allowance on deferred tax assets on net operating losses of approximately $4.8 million and $4.5 million related to Malaysian subsidiary as of March 31, 2025 and September 30, 2024, respectively.

Uncertain tax positions

The Company evaluates each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits associated with the tax positions. An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. As of March 31, 2025 and September 30, 2024, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur interest and penalties tax as of March 31, 2025 and September 30, 2024.

Note 13 – Shareholders’ Equity

The Company’s ordinary shares trade on the NASDAQ stock exchange under the symbol “GTI”. Pursuant to the terms of the Amended and Restated Certificate of Incorporation, the company’s authorized share capital is $50,000 divided into 479,000,000 Class A Ordinary Shares, 20,000,000 Class B Ordinary Shares, and 1,000,000 Preference Shares each of par value $0.0001 per share.

On December 20, 2023, Energem and Graphjet negotiated and entered into a definitive purchase agreement for a PIPE investment (the “PIPE Investment Purchase Agreement”) with Dato’ Sri Pang Chow Huat and/or investment vehicles directly managed by such investor (the “PIPE Investor”) as amended and restated on January 10, 2024. Pursuant to the PIPE Investment Purchase Agreement, Graphjet sold to the PIPE Investor 4,530 Graphjet Pre-Transaction Shares before the Closing of the Business Combination that was exchanged for 250,000 Combined Entity Ordinary Shares for a total of $2,500,000.

On March 14, 2024, the Company completed its reverse recapitalization with Energem (see Note 4). The shares and corresponding capital amounts and all per share data related to Graphjet’s outstanding ordinary shares prior to the reverse recapitalization in the accompanying consolidated financial statements have been retrospectively adjusted using the Exchange Ratio of 55.1. All of the Graphjet Technology ordinary shares issued and outstanding at the consummation of the business combination have been fully paid.

On November 1, 2024, the Company successfully completed a fundraising exercise amounting to approximately $1.0 million (MYR 4.4 million) net proceeds from new external shareholders. In connection with this fundraising, the Company issued a total of 653,081 Class A ordinary shares to unrelated third-party investors.

As of March 31, 2025 and September 30, 2024, we had issued and outstanding Class A Ordinary Shares 147,391,887 and 146,738,806 shares, each with par value of $0.0001. The holder of each share of ordinary shares is entitled to one vote.

Note 14 – Equity Incentive Plan

At the Special Meeting on February 28, 2024, Energem shareholders considered and approved the Equity Incentive Plan and reserved an amount of ordinary shares equal to 10% of the fully diluted issued and outstanding Combined Entity Ordinary Shares following the Business Combination for issuance thereunder. The Equity Incentive Plan was approved by the Energem board of directors on the same day. The Equity Incentive Plan became effective immediately upon the Closing of the Business Combination. A total number of shares equal to 14,903,075 have been reserved for future issuance under the Equity Incentive Plan.

Graphjet Technology’s employees, consultants and directors, and employees, consultants and directors of its subsidiaries will be eligible to receive awards under the Equity Incentive Plan. The Equity Incentive Plan is expected to be administered by the Graphjet Technology Board with respect to awards to non-employee directors and by Graphjet Technology’s remuneration committee with respect to other participants, each of which may delegate its duties and responsibilities to committees of Graphjet Technology directors and/or officers (referred to collectively as the “plan administrator” below), subject to certain limitations that may be imposed under stock exchange rules. The plan administrator will have the authority to interpret and adopt rules for the administration of the Equity Incentive Plan, subject to its express terms and conditions. The plan administrator will also set the terms and conditions of all awards under the Equity Incentive Plan, including any vesting and vesting acceleration conditions.

Note 15 – Warrants

In connection with the reverse recapitalization, the Company has assumed 12,028,075 Energem warrants outstanding, which consisted of 11,500,000 public warrants and 528,075 private warrants. All of these warrants met the criteria for equity classification.

Each whole warrant entitles the registered holder to purchase one whole share of the Company’s common stock at a price of $11.50 per share. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of shares of common stock. This means that only a whole warrant may be exercised at any given time by a warrant holder. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will expire five years after the completion of the Company’s initial business combination or earlier upon redemption or liquidation.

The Company has agreed that as soon as practicable, but in no event later than 30 business days, after the closing of the initial business combination, it will use its reasonable commercially reasonable efforts to file, and within 60 business days following its initial business combination to have declared effective, a registration statement for the registration, under the Securities Act, of the shares of common stock issuable upon exercise of the warrants. The Company will use its commercially reasonable efforts to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the warrants in accordance with the provisions of the warrant agreement. No warrants will be exercisable for cash unless the Company has an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such shares of common stock. Notwithstanding the above, if the Company’s common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event it so elect, it will not be required to file or maintain in effect a registration statement, but it will be required to use its commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.

The Company may call the warrants for redemption, in whole and not in part, at a price of $0.01 per warrant:

●

at any time while the warrants are exercisable;

●

upon not less than 30 days’ prior written notice of redemption (the “30-day redemption period”) to each warrant holder; and

●

if, and only if, the reported last sale price of the ordinary shares equals or exceeds $18 per share, for any 20 trading days within a 30-trading day period ending on the third trading day prior to the notice of redemption to warrant holders; and

●

if, and only if, there is a current registration statement in effect with respect to the ordinary shares underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.

The summary of warrants activity is as follows:

	Warrants Outstanding		Ordinary Shares Issuable		Weighted Average Exercise Price		Average Remaining Contractual Life
September 30, 2024		12,028,075		12,028,075	$	11.50		4.00
Granted		—		—	$	—		—
Forfeited		—		—	$	—		—
Exercised		—		—	$	—		—
March 31, 2025		12,028,075		12,028,075	$	11.50		3.50

The Company accounted for the 12,028,075 warrants assumed from the merger as equity instruments in accordance with ASC 480, “Distinguishing Liabilities from Equity” and ASC 815-40, “Derivatives and Hedging: Contracts in Entity’s Own Equity”.

Note 16 – Concentrations of Risks

Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, deposits and other receivables.

(a) Credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash. In Malaysia, the insurance coverage for cash deposits of each depositor at each bank is RM 250,000 (approximately $56,000). As of March 31, 2025, cash balance of RM 987,951 ($222,913) was deposited with financial institutions located in Malaysia, of which RM 708,096 ($159,769) was subject to credit risk. Cash deposits at each United States financial institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. As of March 31, 2025, the Company did not exceed the FDIC insured limits. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.

The Company’s operating subsidiary is in Malaysia, and their functional currency is RM. As a result, the Company is exposed to foreign exchange risk as the Company’s results of operations may be affected by fluctuations in the exchange rate between USD and RM. If the RM appreciates against the USD, the value of the Company’s RM revenues, earnings, and assets as expressed in the Company’s USD financial statements will decline. The Company has not entered any hedging transactions in an effort to reduce the Company’s exposure to foreign exchange risk.

The Company is also exposed to risk from its deposits and other receivables. These assets are subjected to credit evaluations. An allowance has been made for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment.

(b) Vendor concentration risk

For the three months ended March 31, 2025, one supplier accounted for 100% of the total raw material purchases. For the six months ended March 31, 2025, three suppliers accounted for approximately 47.0%, 46.5% and 6.5% of the total raw material purchases.

For the three and six months ended March 31, 2024, the Company did not make any raw material purchases.

Note 17 – Segment Reporting

ASC 280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for detailing the Company’s business segments.

The Company uses the management approach to determine reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker (“CODM”) for making decisions, allocating resources and assessing performance. The Company’s CODM has been identified as the Company’s chief executive officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company. The Company has only one geographic operating location in Malaysia, so the Company determines that reporting operating segments by geographic locations is not necessary.

The Company’s organizational structure is based on a number of factors that the CODM uses to evaluate, view and run its business operations which include, but not limited to, customer base, homogeneity of service and technology. The Company’s operating segments are based on such organizational structure and information reviewed by the CODM to evaluate the operating segment results. Based on management’s assessment, the Company determined that it has only one operating segment as defined by ASC 280.

The following table presents major accounts of statements of operations by segments for the three and six months ended March 31, 2025 and 2024.

	For the Three Months Ended March 31,						For the Six Months Ended March 31,
	2025 (unaudited)			2024 (unaudited)			2025 (unaudited)			2024 (unaudited)
Advertising and marketing expenses	$	38,984		$	101,318		$	118,183		$	131,113
Salaries and benefits expenses		249,995			29,608			506,689			56,703
Provision for bonus		—			13,626,194			—			13,626,194
Insurance, legal and consulting expenses		117,795			181,135			258,745			195,996
Other operating expenses		146,173			152,357			321,388			306,016
Total operating expenses		552,947			14,090,612			1,205,005			14,316,022
Segment operating loss		(552,947	)		(14,090,612	)		(1,205,005	)		(14,316,022	)
Interest expense, net		(13,183	)		(178,175	)		(26,828	)		(357,202	)
Other expenses, net		(10,893	)		(360	)		(34,345	)		(1,052	)
Income tax expense		—			—			—			—
Segment net loss	$	(577,023	)	$	(14,269,147	)	$	(1,266,178	)	$	(14,674,276	)

Note 18 – Commitments and Contingencies

Lease commitments

The Company has entered in one operating factory lease agreement in Selangor expiring through January 2026. The lease contains an option to extend at the time of expiration, and the Company has the right of priority of exercising the option. The Company’s lease agreement does not contain any material residual value guarantees or material restrictive covenants. The lease is classified as an operating lease, and lease expense for the lease is recognized on the straight-line basis over the lease term which the Company estimated to be 1.5 years.

Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The discount rate used to calculate present value is incremental borrowing rate or, if available, the rate which is implicit in the lease. The Company determines the incremental borrowing rate for each lease based primarily on its lease term in Malaysia, which is approximately 6.4% p.a. The total operating lease expenses for the lease agreement for the three and six months ended March 31, 2025 were $12,141 and $24,426, respectively.

Weighted-average remaining term and discount rate related to leases were as follows:

	As of March 31, 2025		As of September 30, 2024
	(Unaudited)
Weighted-average remaining term in number of months
Operating leases		0.83		—
Weighted-average discount rate
Operating leases		6.4% p.a		—

The following table sets forth the Company’s undiscounted future minimum lease payment schedule as of March 31, 2025:

	Lease payments
Twelve months ending March 31, 2026	$	40,614
Total lease payments		40,614
Less: discount		956
Present value of lease liabilities		39,658
Current lease liabilities		(39,658	)
Non-current lease liabilities	$	—

The Company also entered in two operating lease agreements in Malaysia, which will expire till March 2026. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases contain options to extend at the time of expiration, but the Company will not exercise it. The Company did not recognize the operating lease ROU assets and lease liabilities on the balance sheet as this lease had an initial term of 12 months or less.

Operating lease expenses for the two lease agreements amounted to $24,895 and $45,434 for the three months ended March 31, 2025 and 2024, respectively, and $51,938 and $89,266 for the six months ended March 31, 2025 and 2024, respectively, which were recorded under general and administrative expenses.

The following table sets forth the Company’s undiscounted future minimum lease payment schedule as of March 31, 2025. There were no commitment and contingency other than those stated below:

Commitments and Contingencies	Terms	Amount
Rental of premises	Rental payments due from April 2025 to March 2026	$	9,048

Note 19 – Subsequent Events

The Company has evaluated all events that occurred after March 31, 2025 through the date the unaudited condensed consolidated financial statements were available for issuance and identified the following subsequent events occurred that would require recognition or disclosure in the Company’s unaudited condensed consolidated financial statements.

On February 28, 2025, Graphjet received a notification letter (the “Notice”) from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that, as a result of (i) the Company’s delay in filing its Quarterly Report on Form 10-K for the period ended September 30, 2024 (the “Initial Delinquent Filing”) with the Securities and Exchange Commission (the “SEC”) and (ii) the Company’s delay in filing its Annual Report on Form 10-Q for the period ended December 31, 2024 (the “Second Delinquent Filing”), the Company is not in compliance with the requirements for continued listing under Nasdaq Listing Rule 5250(c)(1) (the “Listing Rule”). The Notice states that the Company has 60 calendar days, or until April 29, 2025, to submit a plan to regain compliance with the Listing Rule with respect to the delinquent reports. On April 29, 2025, Graphjet had submitted the plan to regain compliance.

On April 30, 2025, the Company signed a debt settlement agreement with Lim Hooi Beng to settle the amount of $2,152,588 (RM 8,872,969) owing via the issuance of Class A ordinary shares in two tranches: 1. RM 13,000,000 value of shares 12 months from the date of the agreement, and 2. RM 20,000,000 value of shares 24 months from the date of the agreement.

On April 30, 2025, the Company signed a debt settlement agreement with Liu Yu to settle the amount owing of $1,486,704 in the following manner: 1. payment of $221,593 12 months from the date of the agreement; 2. payment of $702,610 24 months from the date of the agreement, and; as part of his severance and interest due, $1 million which shall fall due 24 months from the date of agreement and shall be repaid in 10 consecutive monthly instalments of $100,000 each, payable on the first day of each calendar month commencing from the due date.

On May 15, 2025, Graphjet Technology and Aiden Lee Ping Wei entered into a Warrant Subscription Agreement, pursuant to which Graphjet Technology issued 20,000,000 warrants to purchase up to 200,000,000 of the Company’s Class A ordinary shares, at an exercise price of $0.055 to Aiden Lee Ping Wei.

On May 22, 2025, the Company issued an additional 322,567 Class A Ordinary Shares to Joseph Rallo and 322,568 Class A Ordinary Shares to D. Boral Capital LLC. The issuance is part an adjustment between the agreed share price of USD10.00 per share and the lowest VWAP for a 5-day period up to the registration of the 202,500 Class A Ordinary Shares issued earlier to satisfy $2,025,000 due pursuant to the Satisfaction and Discharge of Indebtedness between the Company, Graphjet Technology Sdn Bhd and EF Hutton LLC.

On June 4, 2025, the Company received a determination letter (the “Determination”) from Nasdaq advising the Company that Nasdaq had determined that the Company had not provided a definitive plan evidencing its ability to achieve compliance with the “Listing Rule” before July 15, 2025. The Determination stated that, as a result, (i) the Company’s request for continued listing on Nasdaq was denied,(ii) the trading of the Company’s Class A Ordinary Shares would be suspended at the opening of business on June 13, 2025 and (iii)a Form 25-NSE would be filed with the Securities and Exchange Commission (the “SEC”),which will remove the Company’s securities from listing and registration on Nasdaq.

On June 11, 2025, the Company submitted an appeal to Nasdaq requesting a hearing before the Panel pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series. The Company intended to present to the Panel its plan to regain and thereafter maintain compliance with the Listing Rule. The hearing request stayed the suspension of the Company’s securities and the filing of the Form 25-NSE for a period of 15 days from the date of the request. In connection with the hearing request, the Company also requested a stay of the suspension pending the hearing. The Company submitted the payment of a hearing fee in the amount of $20,000.00 payable to Nasdaq.

On June 12, 2025, the Company received a letter that the Staff’s determination has been stayed, pending a final written decision by the Panel. The hearing would be held on July 17, 2025. Thus, the Company’s Class A Ordinary Shares continued to trade at least until the Company receives the written response to hearing.

On June 18, 2025, the Company received a written notice from Nasdaq indicating that the Company no longer complied with Nasdaq Listing Rule 5450(a)(1) (“Rule 5450(a)(1)”) requiring that listed securities maintain a minimum bid price of $0.10 per share based upon the Company’s closing bid price for the last 10 consecutive trading days prior to the notice. The notice also stated that the noncompliance with Rule 5450(a)(1) serves as an additional basis for delisting the Company’s securities from Nasdaq, and that the matter will be considered at the hearing to be held on July 17, 2025. This notice served only as a notification of deficiency, not of imminent delisting, and has no current effect on the listing or trading of the Company’s securities. The suspension of the Company’s securities due to its noncompliance with Rule 5450(a)(1) was stayed pending the July 17, 2025 hearing.

On June 26, 2025, the Company purchased new equipment at a total value of approximately $299,000 to use for production. The new equipment has better specifications, including the production of approximately 7 times more than the existing equipment, which will improve the quantity, as well as the quality, of the graphite produced by the Company.

On July 17, 2025, Chris Lai, the Company’s CEO/CFO attended the hearing with the Nadsaq Hearing Panel (the “Hearing Panel”) and, together with the Company’s attorney, presented the Company’s case to the Hearing Panel. During the hearing, Chris Lai made a commitment to the Hearing Panel that the Company’s Forms 10Q for the three months ended December 31, 2024, March 31, 2025, and June 30, 2025 would be filed by the middle of September 2025.

On July 25, 2025, the Company received a decision letter from the Nasdaq Hearings Panel granting the Company’s request to continue its listing on The Nasdaq Stock. The decision is conditioned on the Company (i) demonstrating compliance with Nasdaq Listing Rule 5450(a)(1) (the “Bid Price Rule”) on or before August 29, 2025, (ii) demonstrating compliance with Nasdaq Listing Rule 5450(c)(1) (the “Periodic Filing Rule”) on or before September 15, 2025, and (iii) providing the Panel with an update regarding the Company’s fundraising plans on or before September 30, 2025.

On August 7, 2025, the Company held an extraordinary general meeting of the shareholders of the Company to vote and approve 1) The Share Capital Reorganization Proposal 2) The Share Consolidation Proposal 3) The Charter Amendment Proposal and 4) The Adjournment Proposal. On the same day, the Board approved the implementation of the share consolidation at a ratio of 1-for-60 (the “Share Consolidation”). The share consolidation is expected to become effective on August 25, 2025.

On August 14, 2025, the Company executed two separate Subscription Agreements with Yasuka Infinity SDN BHD (“Yasuka Infinity”) and Goh Meng Keong. The Subscription Agreement with Yasuka Infinity is to settle a debt of USD$ 21,129.80 owed by the Company to Yasuka Infinity. As settlement of the debt, the Company will issue 195,646 ordinary shares, which will be 3,261 post-Share Consolidation shares. The Subscription Agreement with Goh Meng Keong is also to settle a debt of USD$ 553,201.33 owed by the Company to Goh Meng Keong. As settlement of the debt, the Company will issue 11,100,000 ordinary shares, which will be 185,000 post-Share Consolidation shares.

Note 20 – Restatement of Previously Issued Financial Statements

The Company identified material misstatements in its previously issued unaudited condensed financial statements as of March 31, 2024 and for the three and six months ended March 31, 2024 as below, and as a result the Company has restated the previously issued unaudited condensed consolidated financial statements as of March 31, 2024 and for the three and six months ended March 31, 2024 in accordance with ASC 250 Accounting Changes and Error Corrections, to reflect the effects of the restatement adjustments and to make certain corresponding disclosures.

The categories of adjustments and their impacts on previously issued financial statements are described below and identified in the Restatement Reconciliation Tables in the column entitled “Reference”:

a. The Company failed to record the correct cost of the intellectual property purchased from a related party, incorrectly recorded the amortization expense, and incorrectly recorded the liability without considering imputed interest related to the intellectual property purchased. Such failure has resulted in the misstatements of “Intangible assets, net”, “Accumulated deficit” and “Accumulated other comprehensive (loss) profit” as of March 31, 2024, and misstatements of “General and administrative expenses” and “Net loss” for the three and six months ended March 31, 2024.

b. The Company incorrectly recorded the merger transaction costs as general and administrative expenses. Such failure has resulted in the misstatements of “Deferred merger costs”, “Additional paid-in capital”, “Accumulated deficit” and “Accumulated other comprehensive (loss) profit” as of March 31, 2024, and misstatements of “General and administrative expenses” and “Net loss” for the three and six months ended March 31, 2024.

c. The Company incorrectly classified other expenses as general and administrative expenses, and under accrued the bonus of the senior management team of Graphjet for the successful business combination and corporate listing, and classified changes in payable to director as operating activities. Such failure has resulted in the misstatements of “Provision for bonus”, “Accumulated deficit” and “Accumulated other comprehensive (loss) profit” as of March 31, 2024, and misstatements of “General and administrative expenses”, “Other expenses, net” and “Net loss” for the three and six months ended March 31, 2024, and misstatements of “Statements of cash flows” for the six months ended March 31, 2024.

d. The Company incorrectly recorded the accounts related to reverse recapitalization. Such failure has resulted in the misstatements of “Balance sheet” as of March 31, 2024, misstatements of “Weighted average number of ordinary shares outstanding - basic and diluted” for the three and six months ended March 31, 2024, and misstatements of “Statements of cash flows” for the six months ended March 31, 2024.

e. The Company incorrectly used historical exchange rate to translated certain accounts from Malaysian Ringgit (“RM”) into US$. Such failure has resulted in the misstatements of “Balance sheet” as of March 31, 2024, and misstatements of “Statements of operations and comprehensive loss” for the three and six months ended March 31, 2024, and misstatements of “Statements of cash flows” for the six months ended March 31, 2024.

In the following tables, the Company presented a reconciliation of consolidated balance sheets, statements of operations and comprehensive loss, and cash flows as previously issued for these prior periods to the restated and revised amounts.

Summary of Restatements – Unaudited Condensed Consolidated Statements of Operations and Comprehensive loss:

	For the Three Months Ended March 31, 2024
	As previously reported			Adjustments			Reference	As restated

Operating expenses:
General and administrative expenses	$	11,588,991		$	2,505,621		a, b, c, e	$	14,090,612
Total operating expenses		11,588,991			2,505,621		a, b, c, e		14,090,612

Loss from operations		(11,588,991	)		(2,505,621	)	a, b, c, e		(14,090,612	)

Other income (expenses)
Interest expense, net		(5,809	)		(172,366	)	a, e		(178,175	)
Other expenses, net		—			(360	)	c		(360	)
Total other expense, net		(5,809	)		(172,726	)	a, e		(178,535	)

Loss before income taxes		(11,594,800	)		(2,674,347	)	a, b, c, e		(14,269,147	)

Income tax expense		—			—				—

Net loss	$	(11,594,800	)	$	(2,674,347	)	a, b, c, e	$	(14,269,147	)

Foreign currency translation adjustment		43,638			(52,756	)	a, b, c, e		(9,118	)

Total comprehensive loss attributable to ordinary shareholders	$	(11,551,162	)	$	(2,727,103	)	a, b, c, e	$	(14,278,265	)

Weighted average number of ordinary shares outstanding - basic and diluted*		28,979,208			110,468,678		d		139,447,886

Loss per ordinary share - basic and diluted	$	(0.40	)	$	0.30		a, b, c, d, e	$	(0.10	)

*	Giving retroactive effect to reverse recapitalization effected on March 14, 2024 to reflect exchange ratio of approximately 55.1 as described in Note 4.

Summary of Restatements - Unaudited Condensed Consolidated Statements of Operations and Comprehensive loss:

	For the Six Months Ended March 31, 2024
	As previously reported			Adjustments			Reference	As restated

Operating expenses:
General and administrative expenses	$	12,006,929		$	2,309,093		a, b, c, e	$	14,316,022
Total operating expenses		12,006,929			2,309,093		a, b, c, e		14,316,022

Loss from operations		(12,006,929	)		(2,309,093	)	a, b, c, e		(14,316,022	)

Other income (expenses)
Interest expense, net		(11,644	)		(345,558	)	a		(357,202	)
Other expenses, net		—			(1,052	)	c		(1,052	)
Total other expense, net		(11,644	)		(346,610	)	a, c		(358,254	)

Loss before income taxes		(12,018,573	)		(2,655,703	)	a, b, c, e		(14,674,276	)

Income tax expense		—			—				—

Net loss	$	(12,018,573	)	$	(2,655,703	)	a, b, c, e	$	(14,674,276	)

Foreign currency translation adjustment		(11,579	)		(162,390	)	a, b, c, e		(173,969	)

Total comprehensive loss attributable to ordinary shareholders	$	(12,030,152	)	$	(2,818,093	)	a, b, c, e	$	(14,848,245	)

Weighted average number of ordinary shares outstanding - basic and diluted*		15,667,307			122,922,307		d		138,589,614

Loss per ordinary share - basic and diluted	$	(0.77	)	$	0.66		a, b, c, d, e	$	(0.11	)

*	Giving retroactive effect to reverse recapitalization effected on March 14, 2024 to reflect exchange ratio of approximately 55.1 as described in Note 4.

Summary of Restatements - Unaudited Condensed Consolidated Statements of Cash Flows:

	For the Six Months Ended March 31, 2024
	As previously reported			Adjustments			Reference	As restated

Cash flows from operating activities:
Net loss	$	(12,018,573	)	$	(2,655,703	)	a, b, e	$	(14,674,276	)
Adjustments to reconcile net loss to net cash used in operating activities.
Amortization expense		215,848			(215,797	)	a, e		51
Depreciation expense		1,615			(4	)	e		1,611
Foreign currency translation		(11,579	)		11,579		e		—
Changes in operating assets and liabilities
Prepaid expenses		83,950			(32,075	)	d, e		51,875
Advance to a related company		5,039			(581	)	e		4,458
Deposits		(24,862	)		(824	)	e		(25,686	)
Other receivables		(87,321	)		(511	)	e		(87,832	)
Interests payable		11,619			24		e		11,643
Other payables		(290,000	)		290,000		d		—
Accrued expenses		(1,332,158	)		1,079,535		d, e		(252,623	)
Related-party payable		(88,542	)		88,542		d		—
Deferred underwriting fee		(2,000,000	)		2,000,000		d		—
Payable to directors		2,085,880			(2,085,880	)	a, c, d, e		—
Provision for bonus		10,152,526			3,647,474		c		13,800,000
Net cash used in operating activities		(3,296,558	)		2,125,780		a, b, c, d, e		(1,170,778	)

Cash flows from investing activities:
Purchases of property and equipment		(1,264,323	)		(2,514	)	e		(1,266,837	)
Net cash used in investing activities		(1,264,323	)		(2,514	)	e		(1,266,837	)

Cash flows from financing activities:
Proceeds from issuance of shares		6,259,919			(6,259,919	)	d		—
Repayment of working capital loan		(555,358	)		555,358		d		—
Proceeds from long-term debt - related party		—			2,209,863		c		2,209,863
Repayments to long-term debt - related party		—			(106,141	)	c		(106,141	)
Payments of deferred merger costs		—			(919,446	)	b, e		(919,446	)
Proceeds from the completion of reverse recapitalization		—			1,231		d		1,231
Proceeds from PIPE investment		—			2,500,000		b, c, d, e		2,500,000
Net cash provided by financing activities		5,704,561			(2,019,054	)	b, c, d, e		3,685,507

Effect of exchange rate changes		—			(102,981	)	e		(102,981	)

Net change in cash		1,143,680			1,231		a, b, c, d, e		1,144,911

Cash - beginning of the period		2,661			(1,231	)	d		1,430

Cash - end of the period	$	1,146,341		$	—			$	1,146,341

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Graphjet Technology. References to our “management” or our “management team” refer to our officers and directors. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements, which have been prepared in accordance with GAAP, and the related notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Special Note Regarding Forward-Looking Statements

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Exchange Act of 1934, as amended (the “Exchange Act”) that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Quarterly Report including, without limitation, statements under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. When used in this Quarterly Report, words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions, as they relate to us or the Company’s management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of management, as well as assumptions made by, and information currently available to the Company’s management. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on July 15, 2025. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Overview

Graphjet Technology (the “Company”, “Graphjet”, “we,” “us” or “our”), is a former blank check company incorporated under the laws of the Cayman Islands on August 6, 2021 under the name Energem Corp., (“Energem”), and formed for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses.

Business Combination

On November 18, 2021, we consummated an initial public offering (“IPO”). On March 14, 2024 (the “Closing Date”), we consummated a series of transactions that resulted in the combination (the “Merger”) with Graphjet Technology Sdn. Bhd., a Malaysian private limited company (“Graphjet”), pursuant to a share purchase agreement, dated as of August 1, 2022 (the “SPA”) by and among Energem, Graphjet, Swee Guan Hoo, solely in his capacity as the representative for the shareholders of Energem after the closing of the sale and purchase of the Graphjet Pre-Transaction Shares (the “Closing”) for Energem’s shareholders (the “Purchaser Representative”), the individuals listed on the signature page of the SPA under the heading “Selling Shareholders” (each, a “Selling Shareholder” and together, the “Selling Shareholders”), and Lee Ping Wei in his additional capacity as representative for the Selling Shareholders (the “Shareholder Representative”).

The Merger and other transactions contemplated thereby (collectively, the “Business Combination”) closed on March 14, 2024 when pursuant to the SPA, Energem acquired all of the issued and outstanding shares Graphjet Pre-Transaction Shares from the Selling Shareholders and Graphjet became a wholly owned subsidiary of Energem. Pursuant to the SPA, Energem changed its name to “Graphjet Technology” and the business of the Company became the business of Graphjet.

The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Energem was treated as the acquired company and Graphjet was treated as the acquirer for financial statement reporting purposes.

Organization and Nature of Business

The Company is the owner of the state-of-the-art patented technology for the manufacture of high-quality graphene and graphite, critical raw materials utilized across various industries including energy storage, electronics, aerospace and advanced manufacturing. For graphene, is an extraordinary material that has sparked a global rush in industry. Graphjet Technology produces graphite, graphene and graphene-based anode battery material with over 98% similarity and greater consistent compared to other synthetic graphite and graphene which are produced from petroleum coke and coal. The breakthrough technology transforms a sustainable, abundant and renewable agricultural waste product, palm kernel shells into highly valuable artificial graphene and graphite, significantly reducing carbon emissions in the process. For research and development in graphite and graphene applications, Graphjet Technology collaborates closely with prestigious institutions such as the National University of Malaysia (UKM) and University Teknikal Malaysia Melaka (UTEM), which serve as the Company’s Technology Advisor Panel, providing expect insights and guidance in technology advisory for the applications. Additionally, Graphjet’s strategic membership in the Industrial Liaison Program (ILP) at Massachusetts Institute of Technology (MIT) underscores its commitment to continuous innovation and cutting-edge research partnership.

Positioning itself as a leader in cost efficiency, Graphjet aims to be the foremost low-cost producer of premium artificial graphite and graphene. The Company holds a patent for its proprietary bio-mass conversion process and graphite production method, and its graphene manufacturing technique. This unique capability positions Graphjet as the sole producer capable of mass-scale production of graphite and graphene using sustainable biomass sources, setting it apart from competitor worldwide.

Leveraging this innovation approach, Graphjet Technology aims to produce superior products at a significantly reduced cost compared to conventional graphite and graphene production methods that rely on non-renewable sources.

This competitive advantage ensures the company’s products not only meet but exceed industry standards for quality and sustainability.

As for now, Graphjet Technology has not commenced commercial sales, but plans to strategically sample its products to leading multinational companies to gain market acceptance and facilitate procurement. The Company’s ultimate goal is to displace high-cost suppliers with its competitively priced, eco-friendly alternatives. To date, the Company has funded its operations primarily with proceeds through equity investments provided by its current shareholders.

In July 2023, the Company secured a production facility in Kampung Baru Subang, Selangor State, Central Malaysia. Machinery commissioning was completed and production was started. The Company has generated revenue from selling side products since June 2025.

Key Factors Affecting Operating Results

The Company believes the key factors affecting the financial condition and results of operations include the following:

Intellectual Properties

Graphjet Technology acquired a palm-based synthetic graphite and the preparation method thereof with the application no. PI2021002802, a palm-based synthetic graphite and the preparation method thereof with the application no. CN111892048A and a preparation system of palm-based synthetic graphite with the application no. CN111675214A and all the intellectual property rights attached thereto. The Company also purchased the process for producing palm-based graphene. The Company currently owns all of the intellectual property rights to its technology and manufacturing process and the Company’s technology is not subject to any ownership, intellectual property, or other rights of any parties other than Graphjet Technology.

The Company’s innovative technology offers a strong alternative option in the artificial graphite market. Traditionally, artificial graphite is preferred by the technology industry due to its superior quality over mineral graphite. Conventional artificial graphite usually sourced from coal or petroleum coke, which is a byproduct in its respective industry. Therefore, conventional artificial graphite may be limited by shortages or supply chain issues related to coal and petroleum coke. At this time, there are no similar supply chain issues that would affect Graphjet Technology’s access to palm kernel shells used to produce its version of artificial graphite.

The Company’s success hinges on sourcing, maintaining, and enforcing strong intellectual property protections for its technology and methodologies. Should we fail to achieve comprehensive protection, others could potentially duplicate and commercialize similar technologies, undermining our competitive advantages and hindering our ability to successfully market our innovations or strategic.

Graphite Pricing

Graphite prices have receded with the ban of China graphite since December 1, 2023. Our business, financial condition and operating results could be materially and adversely affected to the extent prices for graphite continue to decline in future.

Supply of Palm Kernel Shells

Palm kernel shells are the critical raw material for our graphite production. Since initiating the merger exercise in August 2022, we have witnessed a surge in palm kernel shell prices driven by heightened demand, adversely impacting our operational performance due to increased raw material cost.

Customer and Border Control Issues between Malaysia and China

The recent border control measures implemented by Malaysia and China have disrupted critical raw material supply chains. These restrictions have impacted our ability to transport and trade graphite efficiently, resulting in delays to qualification timelines, production schedule and timelines and overall costs escalations.

US-China Trade War and China Banning Export of Graphite and Graphene and its related machineries

The ongoing trade tensions between the US and China continue to reshape global economic landscapes, with critical implications for strategic materials. Graphite, being a critical raw material, sourcing for its machineries amidst trade war is not immune to these effects. In response, we are proactively diversifying our sourcing strategy to mitigate risks associated with this trade war. China’s restriction on graphite exports, coupled with the EU’s regulations limiting the use of graphite and graphene due to environmental concerns, underscore the need for strategic adaptation. While the potential of these materials remains significant, we are committed to balancing their advantages with sustainable and responsible practices.

Conflicts and Geopolitical Positions

The complex geopolitical landscape, particularly the ongoing conflicts, further escalation of the war, as well as further escalation of tensions between various countries could result in a global economic slowdown and long-term changes to global trade, which continues affects global supply chains and trade dynamics. As a result, the Company’s ability to procure raw materials at the desired price may be affected. Furthermore, the Company’s ability to raise equity and debt financing may be impacted by these events, including as a result of increased market volatility, or decreased market liquidity in third-party financing being unavailable on terms acceptable to the Company or at all. The impact of these events on the world economy and the specific impact on the Company’s financial position, results of operations and its cash flows are not yet determinable. We remain acutely aware of these developments and prepared to pivot out strategic to mitigate their impact on our operation.

Impact of China’s Export Ban on Graphite

China’s ban on graphite exports has significant impact on the global supply chain. Graphite, a critical raw material in anode materials and battery production, has seen supply constraints that have led to production slowdowns across the electric vehicle (EV) industry. While we are actively exploring alternative sourcing channels to maintain our supply, we acknowledge the widespread challenges posed by the reduced global graphite demand. Our resolve to navigate these disruptions remains steadfast, as we continuously adapt to evolving market conditions to support sustainable growth and resilience.

Price Reduction and Market Slow Down of Critical Minerals

The reduction in the price of critical minerals has implications market slowdown, posing significant challenges for industry growth and revenue stability. As responsible stewards of market expansions and resilience, we are closely monitoring these pricing and market dynamics. We are committed to recalibrating our financial forecasts and operational strategies to ensure sustainable business practices and competitiveness. We value the trust of our stakeholders as we navigate these adjustments to align with market realities.

Competition

The competitive landscape in the graphene and graphite industry is driven by several factors, including market acceptance, material differentiation and quality, delivery reliability and customer service. The competition is expected to remain fierce, based primarily on price, performance and cost effectiveness, customer service and product innovation. Competition could prevent implementation of price increases, require price reductions or require increased spending on research and development, marketing and sales that could adversely affect us. Market shifts, such as changing customer preferences and advancements technology, could directly affected our ability to remain competitive and sustain profitability. Failure to achieve anticipated sales volumes and customers adoption rates could have a detrimental impact on Graphjet Technology’s business, financial health, operating results and future prospects.

Regulatory Environment

The graphene and graphite industry are governed by laws, which continue to evolve and change over time. The costs and resources necessary to comply with these laws are significant. Our profitability depends in part upon our ability, and that of our affiliated providers and independent contractors, to operate in compliance with applicable laws and to maintain all applicable licenses. To the extent any of our employees or third-party contractors engages in any misconduct or activity in violation of an applicable law, we may be subject to increased liability under the law or increased government scrutiny. If any such action is instituted against us, and we are not successful in defending ourselves or asserting our rights, such action could have a significant impact on our business, including the imposition of significant fines or other sanctions. Complying with any new legislation and regulations could be time-intensive and expensive, resulting in a material adverse effect on our business, prospects, financial condition and/or results of operations.

Business Development and Marketing

Our commitment to excellence extends well beyond production. We recognize that robust business development and effective marketing strategies are fundamental for sustained success. To ensure our position in the competitive market, we are dedicating ample resources to enhance our business developing various strategies to better reach our customers with new marketing tools. The focus of our business development is the development of quality products that is able to meet the demand of our customers, building trust with customers and foster long term business relationship with our customers.

Qualification Process Duration

The qualification process for our products by prospective customers is a rigorous and necessary step, in line with industry standards. Industry standards dictate that this process generally spans 12 to 18 months, involves comprehensive testing, stringent quality assurance protocols, and detailed compliance checks. Our commitment during this period is to uphold the highest standards of performance and reliability in our product to our customers. While the timeline may seem extended, it represents a strategic investment in ensuring that our offerings consistently meet or exceed industry expectations.

Political and Regulatory Risks for Green Energy Policies

Graphjet may face significant uncertainty stemming from changing political landscapes and shifting green energy policies. Lawmakers’ shifting position on supporting green energy initiative make it difficult for company to project revenues and make investment decision confidently. This inconsistent support affects innovation and the adoption of sustainable materials like graphite and graphene. In addition, the lack of a consistent approach to subsidies and incentives poses a considerable challenge. Company may face reduced funding and stalled research and development efforts, limiting their ability to stay competitive and innovate. Election cycles and new government leadership can result in abrupt changes in policy, impacting strategic plans and long-term investments. Companies must continuously adapt to these policy shifts, which can be resource-intensive and disrupt operation.

Environmental Compliance and Regulation

Strict and evolving environment regulations are necessary for sustainability but add complexity to operations. Company must invest significantly in eco-friendly technologies and production methods to comply, which can increase operating costs and lengthen production cycles. Failure to comply can lead to penalties, legal challenges and reputational damage. The financial burden of compliance diverts funds from other growth-oriented activities, putting smaller companies at risk of failing behind larger competitors with more resources.

Geopolitical Tensions and Policy Shifts

Geopolitical tensions, such as presidential elections and policy shifts, affect trade relations, market access, and the availability of key raw materials. The uncertainty surrounding these events can cause delays in corporate decision-making, hinder expansion plans, and affect operational efficiency. Graphjet Technology may experience disrupted supply chains, unpredictable regulatory changes, and an inability to plan for long term growth, impacting profitability and stability.

Export and Import Regulations

Stringent import and export regulations in key markets such as Malaysia and US pose significant operational challenges. Company needs to navigate complex customs procedures and adapt to frequent policy changes that can delay shipments and increase costs. Political tensions further complicate this, leading to uncertainty in international trade. Regulatory barriers can lead to delays in product delivery, increased logistical expenses, and missed business opportunities.

Semiconductor Industry Challenge

The slowdown in the semiconductor industry, highlighted by Intel’s financial struggles, has a domino effect on industries reliant on high-tech components. Graphjet, which supplies critical materials for chip production, may face reduced demand and disrupted partnership. The heavy reliance of Nvidia and AMD on TSMC, alongside China’s influence over Taiwan, creates additional risks. Graphjet Technology may find it harder to secure contracts and partnerships within the semiconductor sector, leading to decreased revenue streams and limited market reach.

Impact of Raw Material Shortages on Industry Leaders

Major players such as Posco and Samsung SDI have scaled back operation due to raw material shortages and political uncertainties. This reflects broader market challenges that we faced, including securing a steady supply chain and maintaining production levels. Reduced availability of raw materials drives up cost and forces production cuts, which could weaken company’s market position and profitability.

SEC Form 10-Q filed by Graphjet Technology