Fairwood Holdings (0052) AI Stock Analysis

• Market Cap: HK$707.36M
• Dividend Yield: 3.66%
• Average Volume (3M): 111.10K
• Price to Earnings (P/E): 19.9
• Beta (1Y): 0.32
• Revenue Growth: 1.46%
• EPS Growth: -22.18%
• Country: HK
• Employees: 5,600
• Sector: Services
• Sector Strength: N/A
• Industry: Restaurants
• EPS (TTM): 0.15
• Shares Outstanding: 129,552,780
• 10 Day Avg. Volume: 88,414
• 30 Day Avg. Volume: 111,100
• PEG Ratio: -0.58
• Price to Book (P/B): 1.11
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 1.55
• 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

• Rating: 60 Neutral
• Price Target: ―

Fairwood Holdings has a stable financial foundation with revenue growth and strong cash flow management. However, high leverage and moderate profitability margins pose risks. The technical analysis indicates bearish momentum with oversold signals. The valuation appears slightly high but is balanced by a strong dividend yield. These factors culminate in a moderately favorable outlook.

Fairwood Holdings Business Overview & Revenue Model

Company Description

Fairwood Holdings Limited (0052) is a prominent fast-food restaurant group based in Hong Kong, with operations extending to Mainland China. Established in 1972, the company is renowned for its efficient service and diverse menu offerings that blend traditional Chinese flavors with Western culinary influences. Fairwood operates a network of casual dining outlets, focusing on providing quality meals at affordable prices to a broad customer base.

How the Company Makes Money

Fairwood Holdings generates revenue primarily through the operation of its fast-food restaurant chain. The company earns income from direct sales of food and beverages to customers at its numerous outlet locations. A significant portion of its revenue comes from its Hong Kong operations, where it has established a strong market presence. Additionally, Fairwood leverages its brand reputation and customer loyalty programs to drive repeat business. The company also explores strategic partnerships and initiatives to optimize supply chain management and reduce operational costs, thereby enhancing profitability. While the company occasionally engages in marketing collaborations or promotions, its core earnings are fundamentally driven by in-store dining and takeaway sales.

Fairwood Holdings Financial Statement Overview

Summary

Fairwood Holdings presents a stable financial position with consistent revenue growth and strong cash flow generation. However, high leverage and moderate profitability margins suggest potential areas for improvement. The company is well-positioned in terms of operational efficiency but must manage its debt levels to reduce financial risk.

Income Statement

Fairwood Holdings has shown consistent revenue growth with a 3.71% increase from 2023 to 2024. The gross profit margin is 8.63%, and the net profit margin is 1.62%, indicating moderate profitability. The EBIT margin of 3.14% and EBITDA margin of 19.09% show stable operational efficiency, though there is room for improvement in profitability.

Balance Sheet

The company's debt-to-equity ratio is approximately 1.58, indicating a relatively high leverage, which could pose risks in economic downturns. However, the equity ratio of 29.38% suggests a balanced proportion of equity in the asset structure. Return on equity (ROE) is 7.67%, reflecting a modest return to shareholders.

Cash Flow

Fairwood Holdings has demonstrated strong cash flow management with a free cash flow growth rate of -13.08% from 2023 to 2024. The operating cash flow to net income ratio is 12.83, and the free cash flow to net income ratio is 10.47, highlighting robust cash generation relative to net income.

Breakdown	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	3.14B	3.02B	2.88B	2.65B	3.03B
Gross Profit	270.59M	256.76M	222.56M	327.60M	277.37M
EBITDA	598.94M	565.98M	554.33M	721.66M	652.73M
Net Income	50.66M	44.88M	42.64M	153.62M	60.87M
Balance Sheet
Total Assets	2.25B	2.30B	2.34B	2.45B	2.71B
Cash, Cash Equivalents and Short-Term Investments	640.98M	646.76M	557.10M	638.89M	514.19M
Total Debt	1.04B	1.13B	1.19B	1.22B	1.46B
Total Liabilities	1.59B	1.62B	1.62B	1.67B	1.99B
Stockholders Equity	660.40M	680.63M	714.24M	777.84M	720.81M
Cash Flow
Free Cash Flow	530.54M	610.41M	484.99M	671.03M	516.10M
Operating Cash Flow	650.11M	709.44M	561.47M	780.90M	644.12M
Investing Cash Flow	-160.84M	-156.78M	-50.89M	-111.47M	-116.55M
Financing Cash Flow	-537.27M	-520.71M	-569.73M	-565.42M	-535.40M

Fairwood Holdings Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 5.46
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• 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 Neutral. The current price of 5.46 is above the 20-day moving average (MA) of 5.36, above the 50-day MA of 5.20, and below the 200-day MA of 5.93, indicating a neutral trend. The MACD of 0.08 indicates Positive momentum. The RSI at 56.96 is Neutral, neither overbought nor oversold. The STOCH value of 46.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HK:0052.

Fairwood Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2268	76 Outperform	HK$57.93B	50.38	17.75%	―	―	―
Sector *	71 Outperform	¥224.66B	18.75	15.37%	2.58%	6.03%	218.60%
0987	69 Neutral	HK$350.86M	21.21	0.89%	3.57%	-10.08%	-29.03%
1530	69 Neutral	$67.67B	30.15	14.19%	0.87%	14.36%	33.22%
0688	69 Neutral	$149.51B	8.82	4.15%	4.39%	-10.21%	-40.22%
0052	60 Neutral	HK$707.36M	19.91	5.42%	3.66%	1.46%	-22.18%

Fairwood Holdings Corporate Events

Fairwood Holdings Announces Key Leadership Changes

Fairwood Holdings Limited announced significant changes in its leadership structure effective from April 1, 2025. Dennis Lo Hoi Yeung has been re-designated from Executive Director to Non-executive Director while retaining his role as Chairman. His son, Lo Fai Shing Francis, has been appointed as Vice Chairman, stepping down from his position as Chief Executive Officer, a role now filled by Peggy Lee. These changes reflect a strategic realignment within the company, potentially impacting its governance and operational dynamics.

Fairwood Holdings Announces Board Composition and Committee Roles

Fairwood Holdings Limited has announced the composition of its Board of Directors and their respective roles within the company. The Board includes a mix of non-executive, executive, and independent non-executive directors, with Dennis Lo Hoi Yeung serving as the Non-executive Chairman. The announcement also details the membership of the company’s three Board committees, highlighting the leadership and participation of various directors in the Audit, Remuneration, and Nomination Committees. This structured governance is likely to impact the company’s strategic decisions and operational oversight.