F-1/A: MPJS Group Limited Files for Nasdaq IPO Amidst Strong Revenue Growth and Geopolitical Uncertainties

MPJS Group Limited, a Hong Kong-based jewelry retailer, is seeking to raise up to $6 million in its initial public offering on the Nasdaq Capital Market, reporting significant revenue and net income growth for the fiscal year ended October 31, 2024, despite navigating complex regulatory and geopolitical risks associated with its BVI holding company structure and Hong Kong operations.

Summary

• MPJS Group Limited, a British Virgin Islands holding company, is conducting an Initial Public Offering (IPO) of 1,500,000 Ordinary Shares and a Resale Offering of 1,300,000 Ordinary Shares by its Selling Shareholder, MPJS Investment Co., Ltd.
• The company operates as a jewelry retailer in Hong Kong through its wholly-owned subsidiaries, Man Pong Jewelry Limited (MPJ) and Gosheng Jewelry International Limited (Gosheng), with five retail stores.
• For the fiscal year ended October 31, 2024, total revenue increased by 56.30% to HK$111,981,916 (approximately US$14,404,671) from HK$71,644,305 in 2023.
• Net income grew by 18.41% to HK$5,978,480 (approximately US$769,036) in 2024, up from HK$5,048,953 in 2023.
• Gross profit margin decreased from 25.70% in 2023 to 18.94% in 2024, primarily due to increased sales of lower-margin Pure Gold Products like gold pellets.
• The company plans to use the estimated net IPO proceeds of approximately US$3.65 million for expanding retail presence (30%), renovating existing stores (30%), recruiting a design team and upgrading equipment (20%), upgrading its retail management system (10%), and working capital (10%).
• MPJS is structured as a BVI holding company with operations solely in Hong Kong, explicitly stating it has no operations or VIE structure in Mainland China, but acknowledges unique risks due to potential PRC regulatory intervention.
• The company's auditor, ARK Pro CPA & Co, is headquartered in Hong Kong and is currently subject to PCAOB inspections, mitigating immediate delisting risks under the HFCAA, but future obstruction by PRC authorities remains a concern.
• MPJS is an emerging growth company and a foreign private issuer, allowing for reduced public company reporting requirements and certain exemptions from Nasdaq corporate governance standards, though it intends to comply with Nasdaq rules applicable to foreign private issuers.
• The Controlling Shareholder, through MPJS Investment, will beneficially own approximately 51.30% of outstanding Ordinary Shares post-offering, making MPJS a controlled company under Nasdaq rules, though it does not currently intend to rely on related exemptions.
• Significant related party transactions include temporary advances totaling HK$22,800,000 (approximately US$2,930,853) from MPJ to Mr. KF Sze (CEO/Director) for property purchases and personal use, which were subsequently offset by a special dividend declared in November 2023.
• The company relies on dividends from its Hong Kong operating subsidiaries to fund its cash and financing requirements, with no current BVI or Hong Kong statutory restrictions on dividend distributions, but potential PRC government intervention on cash transfers from Hong Kong is a risk.

Sentiment

Score: 5

Explanation: The company shows strong revenue and net income growth, indicating positive business momentum and market recovery. However, the significant decrease in gross profit margin, negative operating cash flow in the most recent year, and substantial related party transactions involving the CEO raise concerns. Furthermore, the inherent geopolitical and regulatory risks associated with operating in Hong Kong under potential PRC influence, coupled with the company's small market share in a highly competitive industry, introduce considerable uncertainty and downside potential, balancing out the positive financial performance.

Positives

• Significant revenue growth of 56.30% from HK$71.64 million in 2023 to HK$111.98 million (US$14.40 million) in 2024, driven by increased sales of Pure Gold Products and recycled gold due to improved tourism and demand from Mainland China.
• Net income increased by 18.41% from HK$5.05 million in 2023 to HK$5.98 million (US$0.77 million) in 2024, reflecting overall business growth.
• Shareholders' equity substantially increased from HK$9.54 million in 2023 to HK$25.12 million (US$3.23 million) in 2024, attributed to reduced bank borrowings, settlement of liabilities, and capital adjustments.
• The company has a well-established customer base and strategically located retail stores in densely populated areas of Hong Kong, contributing to high foot traffic and loyal customers.
• MPJS provides quality jewelry at reasonable prices, supported by stringent in-house quality control and accreditations like the Quality Gold Mark from the Hong Kong Jewellers & Goldsmiths Association.
• The management team possesses extensive industry experience and knowledge, with key personnel having over 15-25 years in the jewelry sector, contributing to sound business strategies and market understanding.
• Stable business relationships with major suppliers and subcontractors, some for up to 15 years, ensure a consistent supply of quality raw materials and processing services at competitive prices.
• The company has successfully registered as a Category A registrant under Hong Kong's Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO), indicating compliance with regulatory requirements for precious metals and stones dealers.
• The company's in-house craftsman, Mr. Choi Oi Wa, has over 40 years of experience, enabling specialized and customized jewelry processing services.
• The company has a clear plan for the use of IPO proceeds, focusing on strategic expansion, brand enhancement, and operational improvements, including opening two new retail stores and upgrading its retail management system.
• The PCAOB has determined it was able to secure complete access to inspect and investigate registered public accounting firms headquartered in Mainland China and Hong Kong as of December 15, 2022, reducing immediate HFCAA delisting concerns for the auditor.

Negatives

• Gross profit margin decreased significantly from 25.70% in 2023 to 18.94% in 2024, primarily due to an increase in sales of lower-margin Pure Gold Products like gold pellets.
• The company incurred negative cash flow from operating activities of HK$158,316 (approximately US$20,362) in 2024, a reversal from positive cash flow in 2023.
• The business is highly susceptible to fluctuations in raw material prices, particularly gold, and does not engage in hedging activities, exposing it to significant price volatility risks.
• There is no assurance of access to sufficient supply of high-quality diamonds, which could adversely affect business operations and financial conditions.
• The company relies heavily on a few major customers, with the largest customer accounting for 10.71% of total revenue in 2024, posing a risk of customer concentration.
• Cash flow mismatch risks arise from advance payments to suppliers for gold bars before receiving payments from customers, requiring adequate cash reserves.
• The company relies on bank borrowings to fund operations, and a past breach of a financial covenant with Hang Seng Bank (failing to maintain average bank balance and tangible net asset worth) highlights potential risks of non-compliance with loan agreements.
• The company has incurred substantial temporary advances to its CEO/Director, Mr. KF Sze, for personal use and property purchases (totaling HK$22.8 million / US$2.93 million), which were later offset by a special dividend, raising corporate governance concerns.
• The company has not entered into long-term agreements with its retail customers, making revenue streams potentially less stable and reliant on repeat purchases and recommendations.
• The company faces intense competition in the Hong Kong jewelry retail market, which is highly diversified with over 300 players and dominated by large retailers and international brands, potentially limiting growth and profitability.
• The company's growth strategies, including opening new retail stores, require significant capital outlays and there is no guarantee of achieving expected profitability within desired timeframes.
• The company is exposed to risks of obsolete and slow-moving inventory, which accounted for a significant portion of total assets (60.70% in 2024), potentially impacting cash flow and liquidity.
• The company's success is significantly dependent on key management personnel and an in-house craftsman; the loss of whom could severely disrupt operations and limit expansion capabilities.
• The company has not adopted any equity incentive plans, which could limit its ability to attract and retain talent through equity compensation.

Risks

• Fluctuations in prices of raw materials, particularly gold, may materially and adversely affect the company's business, results of operations, or financial condition, as the company does not use hedging activities.
• There is no assurance of access to sufficient supply of high-quality diamonds, which may materially and adversely affect business, results of operations, or financial conditions.
• Reliance on major corporate suppliers for gold products, without long-term agreements, poses a risk of supply shortages or delays.
• Failure to maintain status as a Category A registrant under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO) in Hong Kong could lead to penalties and business disruption.
• Inability to renew leases for retail stores or early termination of leases could adversely affect business and operations due to the importance of strategic locations.
• New retail stores opened as part of expansion plans may not achieve expected profitability within desired timeframes or at all.
• Failure to timely respond to changing market trends and customer expectations, or to provide satisfactory after-sale services, could materially and adversely affect business and reputation.
• Exposure to risk of obsolete and slow-moving inventory, which may adversely impact cash flow and liquidity, potentially requiring sales at lower prices or write-offs.
• Lack of long-term agreements with retail customers means the company relies on attracting new customers and retaining existing ones, which may not be consistently effective.
• Heavy reliance on a few major customers, with the largest customer accounting for 10.71% of total revenue in 2024, poses a risk of adverse impact from loss or decrease in business from these customers.
• Inability to manage cash flow mismatch arising from material procurement costs for gold bars paid in advance before receiving customer payments, potentially leading to liquidity or insolvency risks.
• Past negative cash flows from operating activities (HK$158,316 in 2024) and potential future operating losses, coupled with increased public company costs, may hinder profitability.
• Reliance on bank borrowings to fund operations, with a past breach of financial covenants, poses a risk of material adverse effects if covenants are not complied with or credit facilities are breached.
• Any illegality of the sources of raw materials and/or recycled gold products could materially affect the company's reputation, business, and results of operations.
• Marketing and promotional efforts may not achieve expected results, potentially leading to increased expenses without corresponding revenue growth or negative feedback impacting brand recognition.
• Failure to maintain a positive brand and reputation due to product issues, unsatisfied customer services, negative publicity, or legal proceedings could adversely affect financial results.
• Exposure to health epidemics, infectious diseases (like COVID-19), and other outbreaks, which could severely impact tourism and consumer spending in Hong Kong.
• Loss of key management personnel and the in-house craftsman could severely disrupt operations and limit expansion capabilities.
• Adverse effects from the currency peg system in Hong Kong or fluctuations in currency exchange rates between Hong Kong dollars and U.S. dollars could impact financial performance.
• Violation, infringement, or failure to protect intellectual property rights (trademarks, domain names, designs) could harm business and competitive position.
• Inadequate insurance coverage against losses and liabilities arising from operations, potentially leading to uninsured financial losses.
• Global and local economic uncertainty, including geopolitical tensions (Russia-Ukraine, Israel-Palestine conflicts) and trade tensions between the U.S. and PRC, may materially adversely affect business operations and customer spending.
• Susceptibility to changes in Hong Kong government policies and macroeconomic conditions, which could affect the jewelry retail market.
• Natural disasters and other catastrophic or force majeure events could lead to damage, disruption, and adverse impacts on business operations.
• The BVI holding company structure with Hong Kong operations involves unique risks, including potential disallowance by PRC regulatory authorities, which could result in a material change in operations or render securities worthless.
• Reliance on dividends from Hong Kong operating subsidiaries to fund cash and financing requirements, with potential PRC government interventions or restrictions on cash/asset transfers from Hong Kong.
• Difficulty for overseas shareholders and/or regulators to conduct investigations or collect evidence within China, including Hong Kong, potentially limiting legal protections.
• Additional costs and procedural obstacles for overseas shareholders in effecting service of legal process, enforcing foreign judgments, or bringing actions in Hong Kong.
• The PRC government may intervene or influence operations in Hong Kong at any time, or exert more control over overseas offerings and foreign investment in Hong Kong-based issuers, potentially limiting operations or rendering shares worthless.
• Uncertainty regarding the interpretation and application of PRC laws and regulations (cybersecurity, M&A, overseas listings), which could become applicable to Hong Kong operations in the future.
• The enactment of the Hong Kong National Security Law and the Hong Kong Autonomy Act could impact the Hong Kong subsidiary's business operations and financial position.
• The enforcement of laws and regulations in Mainland China and their application to Hong Kong can change quickly, embodying uncertainties that could limit legal protections.
• Potential subjection to PRC government control of foreign currency conversion, which may limit foreign exchange transactions, including dividend payments.
• No public market for Ordinary Shares prior to the IPO, and no assurance that an active trading market will develop or be sustained, leading to potential illiquidity.
• Risk of delisting from Nasdaq under the Holding Foreign Companies Accountable Act (HFCAA) if the PCAOB is unable to inspect the company's auditors for two consecutive years.
• As an emerging growth company, reduced disclosure requirements may make securities less attractive to investors, and increased costs will be incurred after ceasing to qualify.
• Potential failure to maintain an effective system of internal control over financial reporting, which could affect accurate financial reporting or fraud prevention.
• The PCAOB inspection of the independent accounting firm could lead to findings that challenge the accuracy of audited financial statements.
• Immediate and substantial dilution in the net tangible book value of Ordinary Shares purchased by new investors.
• Substantial future sales of Ordinary Shares by existing shareholders or the anticipation of such sales could cause the share price to decline.
• The market price for Ordinary Shares may be volatile due to various factors, including broad market and industry factors, financial projections, and negative publicity.
• Volatility in Ordinary Shares price may subject the company to securities litigation, diverting resources and harming reputation.
• Ordinary Shares may be thinly traded, making it difficult for investors to sell shares at or near ask prices or at all.
• Underwriters may release or relax lock-up restrictions on directors, officers, and significant shareholders, increasing the availability of shares and potentially adversely affecting the market price.
• The company's Controlling Shareholder has substantial influence over business decisions, potentially leading to actions not in the best interests of other shareholders.
• The laws of BVI provide limited protections for minority shareholders compared to U.S. laws.
• As a BVI company, the company is permitted to adopt certain BVI corporate governance practices that may differ significantly from Nasdaq standards, potentially affording less protection to shareholders.
• Nasdaq may apply additional and more stringent criteria for initial and continued listing due to the small public offering size and large insider holdings.
• The company does not have a fixed dividend policy and currently intends to retain earnings, meaning investors must rely on price appreciation for a return on investment.
• There is no assurance that the company will not be deemed a Passive Foreign Investment Company (PFIC) for U.S. federal income tax purposes, which could result in adverse tax consequences for U.S. holders.
• Any exercise of future options or issue of restricted shares under an equity incentive plan may result in dilution to shareholders.
• Reliance on information contained only in the prospectus, as the company does not accept responsibility for information in press articles or other unauthorized media.
• Potential exposure to material litigation, including individual and class action lawsuits, as well as investigations and enforcement actions by regulators and governmental authorities.

Future Outlook

MPJS Group Limited anticipates continued growth by expanding its retail presence with two new stores in Hong Kong, enhancing brand recognition through marketing and unifying corporate image, and expanding its jewelry design collection with a new in-house design team and upgraded equipment. The company expects the Hong Kong jewelry market to gradually recover and grow at a CAGR of 7.3% from 2025 to 2029, potentially reaching HK$80.0 billion by 2029, driven by the revival of Mainland China tourism and stable local demand. However, the company intends to retain all available funds and future earnings for business operations and expansion, and does not anticipate declaring or paying any dividends in the foreseeable future.

Management Comments

• "Our directors are of the view that we have sufficient cash to operate our business for at least twelve months from the date of this prospectus."
• "Our directors and management consider that the growth of our business and operation depends on, among other things, the proper execution of our future business plans."
• "We believe that our ability to build a well-established customer base is attributable to the strategic location of the retail stores across various districts in Hong Kong that provide high footfall traffic and through which we can reach out to our customers."
• "We believe that our ability to build customers confidence towards our brand is dependent on the availability of quality and authentic jewelry at reasonable prices."
• "We believe that our senior management is capable of understanding the market trends and the needs of our customers in a timely and efficient manner, formulating sound business strategies, assessing and managing risks, anticipating and taking appropriate actions in response to changes in the jewelry industry and capturing profitable market opportunities."
• "We believe that successful branding is key to our business development and the marketing and promotion of our products and thus, brand development and management should be of utmost importance to increase the general public awareness of our Group and our products."
• "We believe that our current pricing policy enables us to set prices that reflect optimal market conditions and maximize our profitability."
• "We believe that the above-mentioned business arrangement [no long-term agreements with suppliers] is also in line with the jewelry retail industry norm in Hong Kong."
• "We consider that the intellectual property rights are sufficiently protected."
• "Our commitment to addressing customer concerns has been effective. During the years ended October 31, 2023 and 2024, we had not received any material complaints on our products that have a material adverse impact on our business operations."

Industry Context

The Hong Kong jewelry retail market is highly competitive and diversified, with over 300 market players, but is concentrated with the top three participants holding over 50% market share. The industry was severely impacted by the COVID-19 pandemic, with total retail sales plunging from HK$56.4 billion in 2019 to HK$51.2 billion in 2023. However, with the easing of restrictions and China's border reopening in early 2023, the market is expected to recover, with sales rebounding to HK$55.5 billion in 2024 and forecasted to grow at a CAGR of 7.3% from 2025 to 2029, potentially reaching HK$80.0 billion by 2029. Key market drivers include robust demand from Mainland Chinese customers seeking tax-free luxury items, rising affluence of local consumers, and increasing demand for well-crafted and artisanal jewelry, including customized services. The industry is also seeing a shift towards online shopping and benefits from Hong Kong's geographical advantages and government support for trade. MPJS operates in the mid-end market, targeting middle-income customers, and aims to capitalize on these trends through retail expansion and enhanced design capabilities.

Comparison to Industry Standards

• MPJS's gross profit margin of 18.94% in 2024 is lower than its 25.70% in 2023, primarily due to a shift in product mix towards lower-margin Pure Gold Products like gold pellets. This indicates a potential challenge in maintaining profitability compared to competitors who might have a more diversified or higher-margin product portfolio.
• The Hong Kong jewelry retail market is highly concentrated, with 'Company A, Company B and Company C' accounting for more than 50% of market share in 2023. MPJS's market share was 0.14% (based on HK$71.6 million revenue in 2023), indicating it is a very small player in a market dominated by much larger, well-established brands like Chow Tai Fook, Chow Sang Sang, and Luk Fook (traditional retailers) and international luxury brands like Cartier, Tiffany, and Bulgari.
• The company's commission income of 2% or 2.5% for sourcing gold bars is stated to be 'within the industry range' of 1% to 4%, suggesting its pricing for this service is competitive and aligned with market norms.
• MPJS's practice of not entering into long-term agreements with suppliers for gold products is stated to be 'in line with the jewelry retail industry norm in Hong Kong' due to the ample supply and fluctuating gold prices.
• The company's adoption of an installment payment model for customers is noted as 'in line with industry practice and is an effective business strategy' to increase sales volume and allow customers to purchase higher-value jewelry.
• The company's quality control measures, including providing GIA or HRD Antwerp certificates for high-carat diamonds and certifications for jade products from the Hong Kong International Jade & Jewelry Laboratory Limited, align with high industry standards for authenticity and quality assurance.
• The company's receipt of the 'Quality Gold Mark' from the Hong Kong Jewellers & Goldsmiths Association for consecutive years indicates adherence to recognized quality standards within the local industry.

Management Changes

Corporate Governance

Legal Proceedings

• As of the date of the prospectus, none of MPJS or its subsidiaries is currently a party to any material legal or administrative proceedings.
• The company is not aware of any legal proceedings or claims that it believes will have, individually or in the aggregate, a material adverse effect on its business, financial condition, operating results, or cash flows.
• The company has not experienced any incidents regarding products purchased being alleged from illegitimate sources, nor has it been subject to investigations, claims, or legal proceedings in this regard.
• No material misconduct in sales and marketing practice or otherwise which resulted in customer complaints that have not been settled or for which the company had been sanctioned by the Consumer Council or other government authorities during the years ended October 31, 2023 and 2024, and up to the date of the prospectus.
• The company has not received any inquiry or notice or any objection to this Offering from the CSRC or any other PRC authorities that have jurisdiction over its operations in Hong Kong.
• The company has not been involved in any proceedings with regard to infringement of any intellectual property rights, nor has it received any notices of such claims either as a claimant or respondent.

Related Party Transactions

• As of October 31, 2023, the company had HK$22,901,616 (approximately US$2,945,924) due from Mr. KF Sze (CEO and Director) as temporary advances for non-trade purposes, including: HK$7,500,000 (US$964,754) for a residential property in his spouse's name (June 28, 2022); HK$4,800,000 (US$617,443) for a residential property in his sister's name (February 16, 2023); HK$8,000,000 (US$1,029,071) for a commercial property in his own name (October 14, 2023); and HK$2,500,000 (US$321,585) for personal use (October 31, 2023).
• On November 9, 2023, MPJS declared a special dividend of HK$23,301,890 (approximately US$2,997,413) to MPJS Investment (the Controlling Shareholder). MPJS Investment then declared a special dividend to its shareholders (Mr. KF Sze, Ms. SL Sze, Ms. MM Sze). Mr. KF Sze utilized his portion of this dividend (HK$22,901,616) to set-off the amount due to MPJ, fully settling the advances as of the date of the prospectus.
• On November 15, 2023, the company entered into a lease agreement with Mr. KF Sze to lease its office property for HK$20,000 (US$2,573) per month for a one-year term (December 1, 2023 to November 30, 2024). This lease was renewed on February 10, 2025, for a two-year term (December 1, 2024 to November 30, 2026) at the same monthly rent.
• Mr. KF Sze and his spouse, Mrs. KL Sze, provided unlimited personal guarantees for all the company's bank loans for the years ended October 31, 2023 and 2024, without fee charge.

Stakeholder Impact

• **Shareholders (Existing & New Investors)**: New investors will experience immediate and substantial dilution (US$3.81 per share) due to the IPO price being significantly higher than the pro forma net tangible book value. Existing shareholders, particularly the Controlling Shareholder, will retain significant voting power (51.30% post-offering), which could influence corporate decisions. Future sales by existing shareholders after lock-up periods could cause share price volatility. The company's reliance on dividends from Hong Kong subsidiaries and potential PRC government intervention on cash transfers could affect dividend payments to shareholders. The risk of delisting under the HFCAA or other regulatory actions could significantly decrease the value of their investment.
• **Employees**: The company plans to recruit an in-house jewelry design team and more technicians/craftsmen, indicating potential job creation and career development opportunities. However, the reliance on key management and the in-house craftsman means their departure could adversely affect operations and job security for others. The company's commitment to workplace safety and health policies benefits employees.
• **Customers**: The company aims to enhance brand recognition, expand design collections, and provide more comprehensive customized services, which could lead to a wider range of products and improved customer experience. The installment payment option benefits customers by easing financial burden. However, failure to respond to changing market trends or maintain product legality could negatively impact customer confidence and loyalty.
• **Suppliers & Subcontractors**: The company maintains stable, long-term relationships with major suppliers and subcontractors, which is beneficial for consistent business. However, the lack of long-term agreements means relationships are transactional, and any deterioration could lead to the company seeking new partners. The company's stringent quality control and due diligence on raw material sources benefit ethical suppliers.
• **Creditors**: The company relies on bank borrowings, and its ability to meet financial covenants and repay debt is crucial. A past breach of a covenant, though settled, highlights potential risks. The personal guarantees from Mr. KF Sze and his spouse provide additional security for certain bank loans.
• **Regulatory Bodies (SEC, Nasdaq, PCAOB, Hong Kong authorities, PRC authorities)**: The company's IPO and ongoing operations are subject to scrutiny and compliance requirements from these bodies. Non-compliance with U.S. securities laws (e.g., HFCAA) or Hong Kong/PRC regulations could lead to sanctions, fines, or delisting, impacting the company's ability to operate and raise capital.

Next Steps

• Complete the Initial Public Offering (IPO) and list Ordinary Shares on the Nasdaq Capital Market under the symbol MPJS, pending Nasdaq's final approval.
• Expand retail presence by opening two more retail stores across various districts in Hong Kong, utilizing approximately 30% of the net IPO proceeds.
• Renovate and refurnish existing retail stores to unify the corporate image, allocating approximately 30% of the net IPO proceeds.
• Recruit an in-house jewelry design team and upgrade jewelry equipment, using approximately 20% of the net IPO proceeds.
• Upgrade the retail management system, allocating approximately 10% of the net IPO proceeds.
• Utilize the remaining 10% of net IPO proceeds for working capital and other general corporate purposes.
• Continue to monitor and adapt to evolving market trends and customer preferences in the jewelry retail industry.
• Maintain compliance with all applicable Hong Kong laws and regulations, including the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO) and data privacy laws.
• The board of directors will determine any future dividend distributions based on financial condition, results of operations, capital requirements, and other relevant factors, with no dividends anticipated in the foreseeable future.

Key Dates

Recommendation

Keywords

Jewelry Retail, Hong Kong, IPO, Nasdaq, SEC Filing, F-1/A, Gold Jewelry, Diamond Jewelry, Recycled Gold, BVI Holding Company, PRC Regulatory Risk, Corporate Governance, Financial Performance, Retail Expansion, Supply Chain, AML Compliance, Related Party Transactions, PCAOB Inspection, HFCAA, Emerging Growth Company, Foreign Private Issuer, Controlled Company, Market Volatility, Dilution, Cash Flow, Profitability, Consumer Trends, Geopolitical Risk