SCHEDULE 13D: Zhihu Inc. Discloses 5% Beneficial Ownership by Entities Linked to Share Repurchase Program

Zhihu Inc. has disclosed that Plus Channel Limited and Kastle Limited collectively hold a 5.0% beneficial ownership of its Class A ordinary shares, primarily through the company's ongoing share repurchase programs.

Summary

• Plus Channel Limited and Kastle Limited, acting as reporting persons, collectively beneficially own 12,500,709 Class A ordinary shares of Zhihu Inc.
• This ownership represents 5.0% of the 249,124,676 issued and outstanding Class A ordinary shares as of February 28, 2025.
• The shares were acquired through Zhihu Inc.'s share repurchase programs, established since 2022, using the Issuer's working capital.
• The reporting persons hold these shares on trust under Zhihu Inc.'s 2022 share incentive plan.
• A recent repurchase of 90,465 Class A ordinary shares (in the form of 30,155 ADSs) on March 12, 2025, caused the reporting persons' aggregate shareholding to cross the 5% beneficial ownership threshold, triggering this Schedule 13D filing.
• The beneficial ownership includes 11,934,909 Class A ordinary shares in the form of 3,978,303 ADSs and 565,800 Class A ordinary shares held directly by Plus Channel Limited.

Sentiment

Score: 6

Explanation: The filing is largely neutral as it's a compliance disclosure. However, the underlying share repurchase program is generally viewed as a positive action by a company, indicating confidence and a commitment to shareholder value, hence a slightly positive score.

Positives

• The filing indicates an ongoing share repurchase program by Zhihu Inc., which can be a positive signal to investors, suggesting management believes the stock is undervalued and aims to return value to shareholders.
• The shares are held on trust under the Issuer's share incentive plan, potentially aligning the interests of the reporting entities with the company's long-term performance.

Risks

• No specific risks related to the company's operations or financial health are detailed in this Schedule 13D filing, as its primary purpose is to report beneficial ownership.

Future Outlook

The document does not provide explicit forward-looking statements or guidance beyond the ongoing nature of the share repurchase programs established since 2022.

Industry Context

This filing reflects a standard disclosure requirement for significant beneficial ownership changes. The share repurchase program by Zhihu Inc. aligns with a common corporate finance strategy used by companies to return capital to shareholders, reduce share count, and potentially boost earnings per share, a trend observed across various industries when companies have strong cash flows or believe their stock is undervalued.

Stakeholder Impact

• Shareholders: The share repurchase program can be positive for existing shareholders by reducing the number of outstanding shares, potentially increasing earnings per share and stock value.
• Employees: The shares are held under a share incentive plan, which could benefit employees participating in the plan.

Next Steps

• Zhihu Inc. is expected to continue its share repurchase programs as authorized.
• The reporting persons will continue to hold the Class A ordinary shares on trust under the Issuer's share incentive plan.

Key Dates

Recommendation

Keywords

Zhihu Inc., Schedule 13D, Beneficial Ownership, Share Repurchase Program, Class A Ordinary Shares, ADSs, Plus Channel Limited, Kastle Limited, SEC Filing, Corporate Governance