{"url_path":"/sec/lxeh/10-k/2026/item-11","section_key":"item-11","section_title":"Item 11 QUANTITATIVE AND QUALITATIVE","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-12","source_url":"https://www.sec.gov/Archives/edgar/data/1814067/0001213900-26-055168-index.html","accession_number":"0001213900-26-055168","cik":"0001814067","ticker":"LXEH","issuer_name":"Lixiang Education Holding Co. Ltd.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1814067/0001213900-26-055168-index.html","primary_entity_key":"0001814067","primary_entity_name":"Lixiang Education Holding Co. Ltd."},"word_count":583,"has_tables":true,"body_markdown":"**ITEM 11. QUANTITATIVE AND QUALITATIVE\nDISCLOSURES ABOUT MARKET RISK**\n\n** **\n\n**Foreign Exchange Risk**\n\n \n\nOur revenues, expenses and\nassets and liabilities are primarily denominated in Renminbi. Renminbi is not freely convertible into foreign currencies for capital\naccount transactions. The value of the Renminbi against the U.S. dollar and other currencies is affected by changes in China’s\npolitical and economic conditions and by China’s foreign exchange policies, among other things. In July 2005, the PRC government\nchanged its decades-old policy of pegging the value of the Renminbi to the U.S. dollar, and the Renminbi appreciated more than\n20% against the U.S. dollar over the following three years. Between July 2008 and June 2010, this appreciation subsided and the exchange\nrate between the Renminbi and the U.S. dollar remained within a narrow band. Since June 2010, the Renminbi has fluctuated against the\nU.S. dollar, at times significantly and unpredictably. On March 17, 2014, the PRC government announced a policy to further expand\nthe maximum daily floating range of Renminbi trading prices against the U.S. dollar in the inter-bank spot foreign exchange market to\n2.0%. On August 10, 2015, the PRC government announced that it had changed the calculation method for Renminbi’s daily central\nparity exchange rate against the U.S. dollar, which resulted in an approximately 2.0% depreciation of Renminbi on that day. We expect\nRenminbi to fluctuate more significantly in value against the U.S. dollar or other foreign currencies in the future, depending on the\nmarket supply and demand with reference to a basket of major foreign currencies. It is difficult to predict how market forces or PRC\nor U.S. government policy may affect the exchange rate between the Renminbi and the U.S. dollar in the future.\n\n \n\nTo date, we have not entered\ninto any hedging transactions in an effort to reduce our exposure to foreign currency exchange risk. To the extent that we need to convert\nU.S. dollars we received from the initial public offering into Renminbi for our operations or capital expenditures, appreciation of the\nRenminbi against the U.S. dollar would have an adverse effect on the Renminbi amount we would receive from the conversion. Conversely,\nif we decide to convert our Renminbi into U.S. dollars for the purpose of making payments for dividends on our ordinary shares or ADSs\nor for other business purposes, appreciation of the U.S. dollar against the Renminbi would have a negative effect on the U.S. dollar\namount available to us.\n\n \n\nIt is difficult to predict\nhow market forces, PRC or U.S. government policy may impact the exchange rate between the RMB and the U.S. Dollar in the future.\n\n \n\nSee “*Item 3. Key\nInformation—D. Risk Factors—Risks Relating to Doing Business in China—Fluctuations in exchange rates may result in\nforeign currency exchange losses and may have a material adverse effect on your investment*.”\n\n \n\n**Credit and concentration risk**\n\n \n\nFinancial instruments,\nincluding cash and cash equivalents, short-term investments, prepayments and accounts receivable, potentially subject us to credit\nrisks. As of December 31, 2025, our cash and cash equivalents were held by reputable financial institutions with high-credit\nratings and quality. As a result, we do not have significant credit risk associated with the cash and cash equivalents and\nshort-term investments. We do not have significant concentrations of credit risk associated with prepayments. We have not\nexperienced any significant recoverability issue with respect to our accounts receivable and periodically evaluate the\ncreditworthiness of the existing customers in determining an allowance for doubtful accounts primarily based on the age of\nreceivables as well as other factors."}