Tern Properties Co. Ltd. (0277) AI Stock Analysis

• Market Cap: HK$429.71M
• Dividend Yield: 1.15%
• Average Volume (3M): 1.47K
• Price to Earnings (P/E): 6.7
• Beta (1Y): 0.05
• Revenue Growth: -8.55%
• EPS Growth: N/A
• Country: HK
• Employees: 17
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): 0.05
• Shares Outstanding: 277,232,900
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 1,466
• PEG Ratio: -0.02
• Price to Book (P/B): 0.20
• Price to Sales (P/S): 9.90
• P/FCF Ratio: 69.61
• 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: 42 Neutral
• Price Target: HK$1.50 ▲(2.04% Upside)
• Action: Reiterated Date: 10/23/25
• Date: Action: Reiterated 10/23/25

Tern Properties Co. Ltd. is facing significant financial and operational challenges, with ongoing losses and declining cash flows. The technical indicators suggest a bearish trend, and the valuation is unattractive due to negative earnings. The strong balance sheet provides some stability, but strategic improvements are necessary to enhance profitability and investor confidence.

Positive Factors

Balance sheet strength / low leverage

A strong equity position and low leverage provide durable financial stability, giving the company flexibility to fund operations, absorb downturns, or pursue restructuring without immediate refinancing pressure. This structural buffer supports multi-month operational continuity while management works on profitability fixes.

Positive operating cash conversion

Positive operating cash flow relative to net income indicates the core operations convert revenue into cash even with accounting losses. Over a 2–6 month horizon this cash conversion can sustain working capital, support essential capex, and give management time to implement efficiency measures before free cash flow trends fully reverse.

High gross profit margins at core level

Elevated gross margins imply the underlying business retains pricing power or favorable direct-cost structure. That structural advantage makes profitability recoverable if SG&A or other overheads are addressed, enabling management to target operating efficiencies that can restore sustainable margins over several months.

Negative Factors

Persistent negative profitability

Ongoing negative net margins signal the company is not generating accounting profits from operations, which erodes retained earnings and limits internal funding for growth. Persisting losses over months restrict strategic options, force capital allocation tradeoffs, and increase reliance on external financing or asset sales to cover deficits.

Declining free cash flow / liquidity pressure

Declining free cash flow reduces the company's ability to invest, pay obligations, or return capital. Even with low leverage, sustained FCF contraction heightens refinancing and operational risks over a 2–6 month horizon, forcing tougher near-term choices such as cutting investment, restructuring assets, or seeking external capital.

Negative return on equity

A negative ROE means shareholders' capital is not being used to create value, reflecting structural profitability or allocation problems. Over time this undermines capacity to attract funding and limits strategic initiatives; absent operational turnaround, negative ROE can persist and constrain long-term growth.

Tern Properties Co. Ltd. Business Overview & Revenue Model

Company Description

Tern Properties Company Limited, an investment holding company, engages in property investment and treasury investment businesses primarily in Hong Kong. The company owns commercial, office, and residential properties. It also invests in debt and equity securities. The company was formerly known as Eco Properties Limited and changed its name to Tern Properties Company Limited in March 1988. The company was incorporated in 1968 and is based in Central, Hong Kong. Tern Properties Company Limited is a subsidiary of Noranger Company Limited.

How the Company Makes Money

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Tern Properties Co. Ltd. Financial Statement Overview

Summary

Tern Properties Co. Ltd. faces significant financial challenges, particularly in terms of profitability and revenue growth. The company maintains a strong balance sheet with low leverage, which is a positive aspect. However, the persistent losses and declining cash flows highlight the need for strategic improvements to enhance operational efficiency and profitability.

Income Statement

The income statement reveals a challenging financial situation with consistent negative net profit margins, indicating ongoing losses. Revenue has been declining over the years, with a notable drop in the most recent period. Despite high gross profit margins, the company struggles with negative EBIT and EBITDA margins, reflecting operational inefficiencies.

Balance Sheet

The balance sheet shows a strong equity position with a low debt-to-equity ratio, indicating financial stability and low leverage. However, the return on equity is negative, suggesting that the company is not generating sufficient returns on its equity base. The equity ratio is healthy, reflecting a solid capital structure.

Cash Flow

Cash flow analysis indicates a mixed performance. While the operating cash flow to net income ratio is positive, suggesting some operational cash generation, the free cash flow has been declining, indicating potential liquidity challenges. The free cash flow to net income ratio is stable, but the overall cash flow growth rate is negative.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	62.85M	50.40M	56.03M	51.88M	57.13M	64.49M
Gross Profit	54.49M	45.16M	51.11M	49.62M	55.28M	63.01M
EBITDA	29.46M	-46.79M	-3.00M	-68.30M	-45.49M	-120.05M
Net Income	15.91M	-54.46M	-9.80M	-75.20M	-55.08M	-134.23M
Balance Sheet
Total Assets	2.65B	2.63B	2.68B	2.75B	2.84B	3.19B
Cash, Cash Equivalents and Short-Term Investments	401.88M	375.37M	331.83M	202.20M	169.12M	158.25M
Total Debt	40.37M	42.18M	45.54M	47.68M	51.00M	244.83M
Total Liabilities	109.86M	105.05M	108.09M	109.31M	109.58M	307.95M
Stockholders Equity	2.54B	2.52B	2.58B	2.64B	2.73B	2.88B
Cash Flow
Free Cash Flow	14.97M	7.17M	14.62M	21.20M	17.65M	32.71M
Operating Cash Flow	14.97M	7.17M	15.63M	21.20M	17.65M	32.71M
Investing Cash Flow	-60.73M	-34.55M	20.80M	42.97M	182.66M	184.34M
Financing Cash Flow	-8.34M	-9.55M	-8.93M	-10.18M	-204.27M	-80.61M

Tern Properties Co. Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.47
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0277, the sentiment is Negative. The current price of 1.47 is below the 20-day moving average (MA) of 1.59, below the 50-day MA of 1.53, and below the 200-day MA of 1.59, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 47.83 is Neutral, neither overbought nor oversold. The STOCH value of 80.19 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:0277.

Tern Properties Co. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0606	66 Neutral	HK$619.20M	3.36	0.38%	―	-5.91%	-94.58%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
0021	52 Neutral	HK$329.94M	-2.67	-4.29%	―	1303.01%	-45.00%
0089	51 Neutral	HK$661.64M	-0.66	-4.58%	3.60%	-4.31%	19.29%
0727	47 Neutral	HK$966.60M	-2.92	-7.00%	―	-49.07%	94.90%
0277	42 Neutral	HK$429.71M	6.69	0.63%	1.15%	-8.55%	―

Tern Properties Co. Ltd. Corporate Events

Tern Properties Reshapes Board and Committee Line-Up

Tern Properties Company Limited has announced an updated composition of its board of directors, effective 26 February 2026, confirming a structure that includes executive and independent non-executive directors. The board is jointly led by Co-Managing Directors and Joint Chairmen Emily Chan Yan Wai and Alan Chan Yan Lam, alongside executive director Andrew Chan Yan Tin and four independent non-executive directors.

The company has also clarified the membership of its three key board committees, appointing independent non-executive director Chan Kwok Wai as chairman of the Audit, Remuneration and Nomination Committees. The refreshed governance structure, with independent directors leading all major committees, underscores a continued emphasis on oversight, remuneration discipline and transparent nomination processes, which is relevant for shareholders focused on corporate governance standards.

The most recent analyst rating on (HK:0277) stock is a Hold with a HK$1.50 price target. To see the full list of analyst forecasts on Tern Properties Co. Ltd. stock, see the HK:0277 Stock Forecast page.

Tern Properties Names Former Financial Controller as Independent Non-Executive Director

Tern Properties Company Limited has strengthened its board structure by appointing experienced financial executive Mr. Lee Siu Kau as an independent non-executive director, effective 26 February 2026. Lee, a qualified accountant with multinational financial management and governance experience, will also serve on the audit, remuneration and nomination committees, reinforcing the company’s oversight and compliance framework.

Lee previously served as the company’s financial controller until February 2024 but confirms he meets independence requirements, holds no shares in the company and has no relationships with existing directors or major shareholders. His three-year appointment, with an annual director’s fee of HK$138,000 and rotation-based re-election, is expected to enhance board independence and strengthen financial and strategic supervision for shareholders and other stakeholders.

The most recent analyst rating on (HK:0277) stock is a Hold with a HK$1.50 price target. To see the full list of analyst forecasts on Tern Properties Co. Ltd. stock, see the HK:0277 Stock Forecast page.