{"url_path":"/sec/lud/10-k/2026/item-11","section_key":"item-11","section_title":"Item 11 **","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-15","source_url":"https://www.sec.gov/Archives/edgar/data/1984124/0001213900-26-057512-index.html","accession_number":"0001213900-26-057512","cik":"0001984124","ticker":"LUD","issuer_name":"Luda Technology Group Ltd","edgar_url":"https://www.sec.gov/Archives/edgar/data/1984124/0001213900-26-057512-index.html","primary_entity_key":"0001984124","primary_entity_name":"Luda Technology Group Ltd"},"word_count":392,"has_tables":true,"body_markdown":"**ITEM 11.**\n**QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**\n\n \n\n**Liquidity risk**\n\n \n\nWe are exposed to liquidity risk, which is the\nrisk that we will be unable to provide sufficient capital resources and liquidity to meet our commitments and business needs. The Company’s\napproach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities\nwhen due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.\nWhen necessary, we will turn to other financial institutions to obtain short-term funding to meet the liquidity shortage.\n\n \n\n**Interest rate risk**\n\n \n\nAs of December 31, 2025, we had outstanding bank borrowings of approximately\n$12.5 million, of which the bank borrowings of approximately $10.7 million will be payable within one year and the bank borrowings of\n$1.8 million will be payable after one year. The bank borrowings bore an annual effective interest rate ranging from 2.64% to 6.95%. Our\nexposure to interest rate risk primarily relates to the interest rate on our outstanding loans which carry variable interest rate. For\nillustration purpose and based on the outstanding loans of the Group as at December 31, 2025, if the interest rates of floating rate loans\nincrease by 1%, our interest expenses will increase by approximately $32,785 or 6.3%. We have not been exposed to material risks due to\nchanges in interest rates. An increase, however, may raise the cost of any debt we incur presently and in the future and result in an\nadverse impact on our income. \n\n \n\n**Foreign Exchange Risk**\n\n \n\nForeign exchange risk is the risk that the value\nof financial assets or liabilities will fluctuate due to changes in foreign exchange rates. We are exposed to foreign exchange risk from\nour business which is denominated in currencies other than US$ (i.e. RMB). Consequently, the exchange rate to our currency relative to\nother foreign currencies may change in a manner that has an adverse effect on the value of that portion of our assets or liabilities denominated\nin currencies other than US$. For FY2025, we recorded income on foreign currency translation amounting to approximately $0.6 million.\nFor FY2024 and FY2023, we recorded loss on foreign currency translation amounting to approximately $0.3 million and $0.6 million respectively.\nOur currency exposure is measured and monitored on a regular basis by the manager."}