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Ajisen (China) Holdings Limited (HK:0538)
:0538

Ajisen (China) Holdings Limited (0538) AI Stock Analysis

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HK

Ajisen (China) Holdings Limited

(0538)

Rating:60Neutral
Price Target:
HK$1.00
▲(20.48%Upside)
Ajisen (China) Holdings Limited faces financial challenges with declining revenue and cash flow issues, impacting its overall score significantly. Positive technical momentum partially offsets these concerns, but the negative valuation metrics highlight financial risks.

Ajisen (China) Holdings Limited (0538) vs. iShares MSCI Hong Kong ETF (EWH)

Ajisen (China) Holdings Limited Business Overview & Revenue Model

Company DescriptionAjisen (China) Holdings Limited (0538) is a leading restaurant chain operator in China, primarily engaged in the operation of Japanese ramen noodle restaurants under the 'Ajisen Ramen' brand. The company specializes in providing high-quality, quick-service Japanese cuisine, with a focus on ramen noodles and a variety of side dishes. Ajisen (China) Holdings Limited operates an extensive network of restaurants across Mainland China and Hong Kong, catering to the growing demand for Japanese food in these regions.
How the Company Makes MoneyAjisen (China) Holdings Limited generates revenue primarily through its restaurant operations, where income is derived from the sale of food and beverages to customers. The company's key revenue streams include dine-in services, delivery services, and takeaway options. Additionally, Ajisen may benefit from franchising agreements, where franchisees operate restaurants under the Ajisen brand and contribute to the company's revenue through franchise fees and royalties. Strategic partnerships with suppliers and real estate developers can also enhance profitability by optimizing supply chain efficiency and securing prime restaurant locations.

Ajisen (China) Holdings Limited Financial Statement Overview

Summary
The company's financial performance is under pressure, with declining revenue, negative net profit margin, and cash flow constraints in 2024. While the balance sheet remains strong, the negative cash flow raises liquidity concerns.
Income Statement
55
Neutral
The company has experienced fluctuating revenue, with a significant decline in 2024 compared to 2023. Gross profit margin has remained relatively stable, but net profit margin has deteriorated due to negative net income in 2024. EBIT and EBITDA margins have also decreased, indicating challenges in operational efficiency.
Balance Sheet
68
Positive
The company maintains a strong equity base with a declining debt-to-equity ratio over recent years, showcasing financial stability. The equity ratio is healthy, indicating a solid capital structure. However, the return on equity has been negative in 2024 due to net losses, which is a concern.
Cash Flow
45
Neutral
The cash flow statement reveals challenges, with operating cash flow falling to zero in 2024. Free cash flow has also dropped significantly, impacting financial flexibility. The absence of free cash flow growth and operating cash flow to net income ratios in 2024 highlight cash flow constraints.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.72B1.82B1.43B2.00B1.82B
Gross Profit829.10M892.30M626.05M911.23M822.52M
EBITDA128.44M583.75M216.74M162.59M381.87M
Net Income-20.22M181.19M-143.91M20.94M-77.87M
Balance Sheet
Total Assets3.99B3.96B3.87B4.30B4.61B
Cash, Cash Equivalents and Short-Term Investments1.64B1.63B1.47B1.53B1.74B
Total Debt611.57M439.79M503.13M681.37M818.79M
Total Liabilities1.02B903.59M947.27M1.19B1.38B
Stockholders Equity2.91B3.00B2.87B3.06B3.16B
Cash Flow
Free Cash Flow319.48M432.86M244.87M296.46M279.67M
Operating Cash Flow429.94M503.18M299.92M417.72M405.33M
Investing Cash Flow-392.44M-506.58M-47.91M-104.57M-6.34M
Financing Cash Flow-333.31M-329.04M-347.82M-519.84M-350.22M

Ajisen (China) Holdings Limited Technical Analysis

Technical Analysis Sentiment
Positive
Last Price0.83
Price Trends
50DMA
0.78
Positive
100DMA
0.76
Positive
200DMA
0.77
Positive
Market Momentum
MACD
0.01
Positive
RSI
53.27
Neutral
STOCH
37.14
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0538, the sentiment is Positive. The current price of 0.83 is below the 20-day moving average (MA) of 0.84, above the 50-day MA of 0.78, and above the 200-day MA of 0.77, indicating a neutral trend. The MACD of 0.01 indicates Positive momentum. The RSI at 53.27 is Neutral, neither overbought nor oversold. The STOCH value of 37.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0538.

Ajisen (China) Holdings Limited Peers Comparison

Overall Rating
UnderperformOutperform
Sector (56)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
HK$2.11B26.395.40%3.44%1.63%-47.80%
69
Neutral
HK$4.16B17.908.26%8.28%2.29%35.94%
64
Neutral
HK$883.99M14.586.54%5.49%2.49%-33.12%
60
Neutral
HK$895.06M19.75-0.69%7.80%-7.18%-110.84%
56
Neutral
HK$24.58B3.79-2.03%6.58%-0.32%-67.68%
51
Neutral
HK$2.70B-20.95%-6.61%-5748.54%
51
Neutral
HK$811.50M-40.47%8.08%-21.14%-107.76%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:0538
Ajisen (China) Holdings Limited
0.83
-0.07
-7.78%
HK:6811
Tai Hing Group Holdings Ltd.
0.92
0.22
31.43%
HK:0520
Xiabuxiabu Catering Management (China) Holdings Co., Ltd.
0.79
-0.53
-40.15%
HK:0341
Cafe de Coral Holdings Ltd.
7.14
-0.32
-4.29%
HK:2217
Tam Jai International Co., Ltd.
1.57
0.63
67.02%
HK:2150
Nayuki Holdings Ltd.
1.62
-0.33
-16.92%

Ajisen (China) Holdings Limited Corporate Events

Ajisen (China) Renews Shanghai Office Lease with Cost Savings
Jun 30, 2025

Ajisen (China) Holdings Limited has announced the renewal of its tenancy agreement for office space in Shanghai, extending the lease from July 2025 to June 2028. This renewal, involving a connected transaction with JILIN Property, is exempt from certain regulatory requirements due to its size but will still be reported. The new agreement offers a 4.5% reduction in rent compared to the previous terms, potentially improving cost efficiency for the company.

Ajisen (China) Holdings Limited Announces Change in Trusteeship
Jun 19, 2025

Ajisen (China) Holdings Limited has announced a change in trusteeship concerning its controlling shareholder, the ANMI Trust, which is a discretionary family trust set up by Ms. Poon. The change was completed on June 18, 2025, and involved a waiver from the obligation to make a mandatory general offer for the company’s shares, which could have been triggered by this change. This development is significant as it maintains the current shareholding structure without necessitating a general offer, thus preserving the existing control dynamics within the company.

Ajisen (China) Holdings Limited Passes All Resolutions at AGM
May 20, 2025

Ajisen (China) Holdings Limited announced that all proposed resolutions were passed at its annual general meeting held on 20 May 2025. Key resolutions included the adoption of the financial statements for the year ended 31 December 2024, the declaration of a final dividend, the re-election of directors, and the reappointment of Deloitte Touche Tohmatsu as auditors. The approval of general mandates for the issuance and repurchase of shares indicates a strategic focus on flexibility in capital management, which may impact the company’s market operations and shareholder value.

Ajisen (China) Holdings Limited Announces 2025 Annual General Meeting
Apr 28, 2025

Ajisen (China) Holdings Limited has announced its upcoming annual general meeting scheduled for May 20, 2025, in Hong Kong. Key agenda items include the adoption of financial statements for the year ending December 31, 2024, the declaration of a final dividend, re-election of directors, and the re-appointment of Deloitte Touche Tohmatsu as the company’s auditor. The meeting will also seek approval for directors to allot and issue additional shares, with limitations on the aggregate amount of shares to be issued.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jun 24, 2025