Fairwood Holdings (0052) AI Stock Analysis

• Market Cap: HK$580.40M
• Dividend Yield: 4.58%
• Average Volume (3M): 37.06K
• Price to Earnings (P/E): 13.0
• Beta (1Y): 0.28
• Revenue Growth: -2.18%
• EPS Growth: 11.28%
• Country: HK
• Employees: 5,600
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 0.10
• Shares Outstanding: 129,552,780
• 10 Day Avg. Volume: 47,250
• 30 Day Avg. Volume: 37,064
• PEG Ratio: 1.82
• Price to Book (P/B): 1.60
• Price to Sales (P/S): 0.34
• P/FCF Ratio: 1.99
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 55 Neutral
• Price Target: HK$4.50 ▼(-4.26% Downside)
• Action: Reiterated Date: 09/20/25
• Date: Action: Reiterated 09/20/25

Fairwood Holdings' strong cash flow generation and attractive dividend yield are positive factors. However, challenges with declining revenue and high leverage weigh on the overall score. Technical indicators suggest neutral momentum, supporting a moderate outlook.

Positive Factors

Strong operating cash flow generation

Consistently strong operating cash flow relative to net income supports durable internal funding for capex, dividends and working capital. This cash conversion provides flexibility to sustain operations, service debt and invest in store upgrades or digital channels over the next several quarters.

Stable EBITDA margin indicating operational efficiency

A stable EBITDA margin amid revenue pressure implies the business retains cost discipline and scalable unit economics. This operational resilience helps preserve cash generation and competitiveness, supporting margin recovery when top-line trends stabilize over months.

Diversified revenue streams and established brand

Ownership of property assets plus a recognized fast‑food brand and multiple sales channels (dine‑in, takeaway, delivery) provide income diversification. Real estate rents and brand loyalty reduce single‑channel exposure and cushion restaurant volatility over the medium term.

Negative Factors

Persistent revenue decline trend

Ongoing revenue declines signal weakening sales momentum or market share erosion in core foodservice operations. Over several quarters this reduces scale benefits, constrains reinvestment in stores and marketing, and can make margin recovery and cash flow growth more difficult.

High financial leverage (debt-to-equity ~1.45)

Elevated leverage limits financial flexibility and raises refinancing and interest coverage risk in a downturn. High debt reduces capacity to pursue growth initiatives or absorb prolonged revenue weakness, making the balance sheet a structural constraint on strategic options.

Pressure on profitability metrics and ROE

Declining gross and net margins alongside falling ROE indicate shrinking profitability and returns to shareholders. Persisting margin compression can erode retained earnings, weaken dividend coverage over time, and limit the firm's ability to fund expansion without external capital.

Fairwood Holdings Business Overview & Revenue Model

Company Description

Fairwood Holdings Limited, an investment holding company, engages in the operation of fast-food restaurants. The company operates through two segments, Hong Kong Restaurants and Mainland China Restaurants. As of March 31, 2022, it operated 157 stores in Hong Kong, which included 145 fast food restaurants and 12 specialty restaurants under the ASAP, Taiwan Bowl, The Leaf Kitchen, and Kenting Tea House names; and 20 stores in Mainland China. The company is also involved in the property investment and leasing; and trademark and restaurants license holding activities. Fairwood Holdings Limited was founded in 1972 and is headquartered in North Point, Hong Kong.

How the Company Makes Money

Fairwood Holdings generates revenue primarily through its restaurant operations, where it earns income from the sale of food and beverages at its Fairwood outlets. The company has developed a strong brand presence in the fast-food market, attracting a loyal customer base. Key revenue streams include dine-in sales, takeaway orders, and delivery services. Additionally, Fairwood Holdings may benefit from strategic partnerships with food suppliers and delivery platforms that enhance its distribution capabilities. The company's investment in property also provides a supplementary income source through rental income and potential capital appreciation of its real estate holdings.

Fairwood Holdings Financial Statement Overview

Summary

Fairwood Holdings is facing challenges with declining revenue and profitability margins. The balance sheet shows high leverage, but strong cash flow generation indicates financial stability.

Income Statement

Fairwood Holdings has faced challenges in maintaining revenue growth, with a recent decline of 1.03% in revenue. The gross profit margin and net profit margin have also decreased over the years, indicating pressure on profitability. However, the company has managed to maintain a stable EBITDA margin, which suggests some operational efficiency.

Balance Sheet

The company's debt-to-equity ratio is relatively high at 1.45, indicating significant leverage. Return on equity has decreased, reflecting challenges in generating returns for shareholders. However, the equity ratio remains stable, suggesting a balanced asset structure.

Cash Flow

Fairwood Holdings has experienced a decline in free cash flow growth, but the operating cash flow remains strong relative to net income. The free cash flow to net income ratio is healthy, indicating good cash generation relative to earnings.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2020	Mar 2019
Income Statement
Total Revenue	3.06B	3.10B	3.14B	2.88B	2.65B	2.97B
Gross Profit	243.81M	237.21M	270.59M	222.56M	327.60M	384.20M
EBITDA	595.14M	595.29M	598.94M	579.59M	721.66M	331.05M
Net Income	33.23M	35.54M	50.66M	42.64M	153.62M	179.95M
Balance Sheet
Total Assets	2.16B	2.11B	2.25B	2.34B	2.45B	1.28B
Cash, Cash Equivalents and Short-Term Investments	552.07M	545.65M	640.98M	557.10M	638.89M	531.80M
Total Debt	948.22M	943.55M	1.04B	1.19B	1.22B	143.00K
Total Liabilities	1.51B	1.45B	1.59B	1.62B	1.67B	498.13M
Stockholders Equity	644.39M	652.03M	660.40M	714.24M	777.84M	777.68M
Cash Flow
Free Cash Flow	448.55M	415.27M	530.54M	484.99M	671.03M	176.32M
Operating Cash Flow	593.88M	586.45M	650.11M	561.47M	780.90M	291.28M
Investing Cash Flow	-183.80M	-275.90M	-160.84M	-50.89M	-111.47M	-71.65M
Financing Cash Flow	-492.12M	-510.24M	-537.27M	-569.73M	-565.42M	-167.65M

Fairwood Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4.70
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0052, the sentiment is Negative. The current price of 4.7 is above the 20-day moving average (MA) of 4.50, above the 50-day MA of 4.58, and below the 200-day MA of 5.00, indicating a bearish trend. The MACD of -0.03 indicates Negative momentum. The RSI at 34.46 is Neutral, neither overbought nor oversold. The STOCH value of 31.91 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:0052.

Fairwood Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6811	68 Neutral	HK$1.14B	5.43	10.47%	5.56%	4.16%	59.08%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
0052	55 Neutral	HK$580.40M	12.97	5.42%	4.58%	-2.18%	11.28%
1978	51 Neutral	HK$264.00M	-113.78	-2.62%	24.14%	-5.71%	-144.00%
1314	50 Neutral	HK$223.33M	12.23	2.28%	21.88%	1.02%	-71.48%
0538	47 Neutral	HK$982.38M	8.83	0.38%	7.11%	0.26%	-73.09%