Tai Cheung Holdings Limited (0088) AI Stock Analysis

• Market Cap: HK$2.10B
• Dividend Yield: 3.53%
• Average Volume (3M): 147.87K
• Price to Earnings (P/E): 27.7
• Beta (1Y): 0.24
• Revenue Growth: -50.00%
• EPS Growth: 55.44%
• Country: HK
• Employees: 146
• Sector: Real Estate
• Sector Strength: 57
• Industry: Real Estate - Development
• EPS (TTM): N/A
• Shares Outstanding: 617,531,430
• 10 Day Avg. Volume: 207,080
• 30 Day Avg. Volume: 147,866
• PEG Ratio: -0.28
• Price to Book (P/B): 0.33
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -9.04
• 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: HK$3.90
• Price Target Upside: 16.42% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 57 Neutral
• Price Target: ―

The overall score reflects a company with strong balance sheet fundamentals but facing challenges in profitability and cash flow generation. Technical analysis does not indicate any significant momentum, while valuation is moderately attractive due to a high dividend yield. The mixed financial and technical outlook results in a cautious stock assessment.

Positive Factors

Financial Position

Tai Cheung has a solid financial position with net cash of HKD859mn, enabling it to pursue land acquisitions when opportunities arise.

Luxury Home Sales

The decline in HIBOR has lowered mortgage rates and improved homebuyer sentiment, positively impacting luxury home sales.

Net Asset Value

The stock is trading at a significant discount to the assessed NAV, offering potential upside with a target price set at HKD3.90.

Negative Factors

Financial Performance

FY25 net profit fell 16% to HKD62.8mn, slightly below estimates, due to lower-than-expected hotel contribution.

Inbound Tourism

A derailment in inbound tourism is identified as a key risk, which could impact the recovery of hotel operations.

Tai Cheung Holdings Limited Business Overview & Revenue Model

Company Description

Tai Cheung Holdings Limited, an investment holding company, engages in property investment, development, and management businesses in Hong Kong and the United States. The company's property portfolio includes residential, industrial, and office/commercial buildings. It also provides construction and corporate secretary services. The company was founded in 1956 and is headquartered in Central, Hong Kong.

How the Company Makes Money

Tai Cheung Holdings Limited generates revenue primarily through its property development and investment activities. The company acquires land or existing properties, develops these into residential, commercial, or mixed-use projects, and then sells or leases them to generate income. Sales of developed properties provide substantial revenue, while leasing activities offer a steady stream of rental income. Additionally, the company may engage in property management services, which can include maintenance and operational management of their developed properties, thereby contributing to its revenue. Strategic partnerships with construction firms, real estate agents, and financial institutions also play a role in facilitating project development and sales, enhancing the company's revenue-generating capabilities.

Tai Cheung Holdings Limited Financial Statement Overview

Summary

Tai Cheung Holdings Limited shows a mixed financial performance. While the balance sheet is robust with low leverage and strong equity ratios, income and cash flow statements indicate volatility. Revenue growth is notable, but profitability is inconsistent, and cash flow generation is weak.

Income Statement

The company shows fluctuating performance with a notable revenue growth of 15.5% in the last year. However, the gross profit margin decreased significantly from 45.3% to 18.9%, and the net profit margin improved from negative to 61.5%, indicating profitability challenges. The EBIT and EBITDA margins have improved, showing a recovery from previous losses, but remain volatile.

Balance Sheet

The balance sheet is strong with a low debt-to-equity ratio of 0.006, indicating minimal leverage. The equity ratio remains high at 96.6%, reflecting financial stability. Return on equity improved significantly, indicating improved profitability from previous losses.

Cash Flow

Cash flow performance is weak with negative free cash flow and operating cash flow over the past year, though there is a slight improvement in free cash flow. The free cash flow to net income ratio indicates inefficiency in converting profits into cash.

Breakdown	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	121.70M	105.40M	189.80M	102.70M	127.40M
Gross Profit	23.00M	47.70M	60.90M	32.20M	83.80M
EBITDA	40.00M	-6.00M	16.50M	-16.20M	29.00M
Net Income	74.90M	-20.00M	2.90M	-28.20M	124.70M
Balance Sheet
Total Assets	6.66B	6.77B	6.97B	7.17B	7.47B
Cash, Cash Equivalents and Short-Term Investments	1.26B	1.42B	1.79B	2.07B	3.64B
Total Debt	39.40M	114.90M	139.40M	203.10M	287.90M
Total Liabilities	223.50M	263.20M	298.60M	345.50M	472.40M
Stockholders Equity	6.44B	6.51B	6.68B	6.82B	7.00B
Cash Flow
Free Cash Flow	-101.90M	-111.70M	-91.20M	-1.33B	83.30M
Operating Cash Flow	-101.40M	-111.40M	-90.90M	-1.33B	84.00M
Investing Cash Flow	143.80M	-70.40M	-14.30M	-800.00K	-800.00K
Financing Cash Flow	-223.40M	-163.10M	-213.00M	-237.20M	-289.70M

Tai Cheung Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.35
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0088, the sentiment is Positive. The current price of 3.35 is above the 20-day moving average (MA) of 3.25, above the 50-day MA of 3.17, and above the 200-day MA of 2.99, indicating a bullish trend. The MACD of 0.06 indicates Negative momentum. The RSI at 71.99 is Negative, neither overbought nor oversold. The STOCH value of 100.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0088.

Tai Cheung Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	70 Neutral	¥234.38B	14.42	10.69%	3.73%	18.23%	21.01%
0194	60 Neutral	HK$1.62B	―	-7.58%	7.94%	26.14%	-2.71%
0088	57 Neutral	HK$2.10B	27.69	1.18%	3.53%	-50.00%	55.44%
0095	40 Underperform	HK$1.67B	―	-25.08%	―	-39.64%	-125.38%
3ZH	―	€40.99M	―	-42.12%	―	―	―
CQH3	―	€105.85M	6.11	-2.79%	6.08%	―	―
USH	―	€248.57M	―	-10.95%	4.82%	―	―

Tai Cheung Holdings Limited Corporate Events

Tai Cheung Holdings Limited Strengthens Nomination Committee

Tai Cheung Holdings Limited has announced the appointment of two new members to its Nomination Committee. Ms. Ivy Sau Ching Chan, a non-executive director, and Mr. Patrick Chi Kwong Wong, an independent non-executive director, have been appointed to the committee effective March 13, 2025. This move reflects the company’s ongoing efforts to strengthen its governance structure and ensure diverse representation within its leadership team.

Tai Cheung Holdings Limited Announces Board Restructuring

Tai Cheung Holdings Limited has announced changes to its board of directors, effective March 13, 2025. The company has outlined the roles and functions of its executive, non-executive, and independent non-executive directors, as well as the composition of its audit, remuneration, and nomination committees. This restructuring may impact the company’s governance and operational strategies, potentially influencing its market position and stakeholder relations.

Tai Cheung Holdings Limited Forms Nomination Committee to Strengthen Board Governance

Tai Cheung Holdings Limited has established a Nomination Committee to enhance its board’s effectiveness by identifying and nominating suitable candidates for directorships. The committee, primarily composed of independent non-executive directors, is tasked with reviewing the board’s structure and diversity, assessing director independence, and making recommendations on board appointments and succession planning, thereby aligning with the company’s corporate strategy.