China Financial Services Holdings Limited (0605) AI Stock Analysis

• Market Cap: HK$317.65M
• Dividend Yield: N/A
• Average Volume (3M): 1.60M
• Price to Earnings (P/E): 7.3
• Beta (1Y): 11.96
• Revenue Growth: -25.98%
• EPS Growth: N/A
• Country: HK
• Employees: 112
• Sector: Financial
• Sector Strength: 80
• Industry: Financial - Credit Services
• EPS (TTM): 0.29
• Shares Outstanding: 209,286,070
• 10 Day Avg. Volume: 1,332,680
• 30 Day Avg. Volume: 1,597,420
• PEG Ratio: 0.09
• Price to Book (P/B): 0.44
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 1.40
• 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: 51 Neutral
• Price Target: ―

The overall stock score for China Financial Services Holdings Limited is driven by significant operational challenges and technical analysis indicating a bearish market sentiment. While the valuation appears attractive due to a low P/E ratio, the lack of dividends and operational cash flow issues weigh heavily on the stock's performance. Investors should be cautious due to liquidity concerns and negative momentum.

China Financial Services Holdings Limited Business Overview & Revenue Model

Company Description

China Financial Services Holdings Limited, together with its subsidiaries, provides various financial services in the People's Republic of China. The company primarily offers short-term financial services; provides direct loans, including real estate mortgage loans; mortgage loans of civil products, equity, movable properties, etc.; and loans for farmers. It also offers e-commerce and automobile supply chain finance; consumer finance, such as individual and installment credit loans; financial guarantees; financial leasing; and fund management services. China Financial Services Holdings Limited is based in Wanchai, Hong Kong.

How the Company Makes Money

China Financial Services Holdings Limited generates revenue through several key streams. The primary source is its financial leasing segment, where it provides leasing solutions to SMEs, allowing them to acquire necessary equipment and machinery without the upfront costs associated with direct purchase. The company earns money through interest income from these leases. Additionally, it engages in investment activities, earning revenue from capital gains and dividends from its securities portfolio. The financial consultancy segment also contributes to its income by offering advisory services to clients, where fees are charged for strategic financial advice and solutions. Significant partnerships with financial institutions and government initiatives to support SME growth in China also play a crucial role in enhancing the company's revenue potential.

China Financial Services Holdings Limited Financial Statement Overview

Summary

China Financial Services Holdings Limited is experiencing significant operational challenges as evidenced by its negative EBIT and shrinking revenues. While there are improvements in net income and debt management, the lack of operational cash flow indicates potential liquidity issues. The company must focus on stabilizing its operations and enhancing cash flow management to improve its financial health.

Income Statement

The income statement reveals a significant decline in revenue from 2019 to 2024, with a notable drop in gross profit margins. The net profit margin improved in 2024 due to a return to positive net income, but the EBIT and EBITDA margins remain negative, indicating operational inefficiencies. Revenue growth has been inconsistent, reflecting volatility in the company's core operations.

Balance Sheet

The balance sheet shows a stable equity position with a reduction in liabilities over time. The debt-to-equity ratio has decreased from previous years, indicating improved leverage management. ROE turned positive in 2024, reflecting better profitability. However, the equity ratio has been declining, suggesting a potential risk in asset financing stability.

Cash Flow

Cash flow analysis highlights strong free cash flow generation in earlier periods, but a complete lack of operational cash flows in 2024 raises concerns. Free cash flow to net income ratios were previously strong but are now non-existent, reflecting possible cash management issues. The absence of current operating cash flow data suggests operational challenges.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	106.95M	131.47M	202.21M	309.24M	718.39M
Gross Profit	97.71M	70.09M	71.87M	101.87M	394.00M
EBITDA	-10.63M	-57.05M	7.08M	-22.39M	-785.93M
Net Income	41.23M	-159.97M	-48.75M	-246.13M	-1.36B
Balance Sheet
Total Assets	1.74B	2.21B	2.64B	3.37B	4.05B
Cash, Cash Equivalents and Short-Term Investments	273.02M	481.51M	411.60M	571.67M	595.50M
Total Debt	679.24M	1.14B	1.38B	1.80B	2.18B
Total Liabilities	1.00B	1.51B	1.77B	2.36B	2.82B
Stockholders Equity	657.24M	620.71M	789.73M	923.82M	1.14B
Cash Flow
Free Cash Flow	0.00	285.44M	246.19M	589.24M	1.16B
Operating Cash Flow	77.00M	286.82M	247.17M	590.73M	1.16B
Investing Cash Flow	0.00	-18.97M	21.02M	6.59M	2.97M
Financing Cash Flow	0.00	-221.00M	-406.41M	-633.84M	-1.31B

China Financial Services Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.57
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0605, the sentiment is Positive. The current price of 1.57 is above the 20-day moving average (MA) of 1.44, above the 50-day MA of 1.26, and above the 200-day MA of 1.43, indicating a bullish trend. The MACD of 0.05 indicates Positive momentum. The RSI at 56.66 is Neutral, neither overbought nor oversold. The STOCH value of 58.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0605.

China Financial Services Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1669	74 Outperform	HK$300.00M	6.56	4.93%	6.67%	2.95%	-9.06%
6866	68 Neutral	HK$330.40M	7.82	1.97%	4.96%	-21.32%	-63.98%
Sector *	67 Neutral	$16.81B	11.85	9.77%	3.76%	12.07%	-8.35%
0605	51 Neutral	HK$317.65M	7.27	6.45%	―	-25.98%	―
1563		HK$321.27M	11.40	1.12%	―	―	―
1915		HK$159.00M	―	-0.58%	―	―	―
8452	46 Neutral	HK$107.80M	26.55	-1.70%	―	91.80%	―

China Financial Services Holdings Limited Corporate Events

China Financial Services Announces Major Capital Reduction Plan

China Financial Services Holdings Limited has announced a proposed capital reduction, aiming to decrease its share capital account by HK$1,334,829,000 to HK$745,284,000. This move is intended to eliminate accumulated losses and improve financial health, subject to shareholder approval and regulatory conditions.

China Financial Services Holdings Limited Announces Virtual AGM and Share Buyback Plan

China Financial Services Holdings Limited has announced its upcoming annual general meeting, scheduled to be held virtually on June 3, 2025. Key agenda items include the re-election of directors, the appointment of auditors, and a resolution granting the company the authority to buy back up to 10% of its shares, which could impact shareholder value and market perception.

China Financial Services Holdings Proposes New Articles of Association

China Financial Services Holdings Limited has announced a proposal to adopt a new set of articles of association. This move aims to align with recent amendments to the Companies Ordinance and Listing Rules in Hong Kong, promoting paperless corporate communications and expanding the paperless listing regime. The adoption is subject to shareholder approval at the upcoming annual general meeting, highlighting the company’s commitment to regulatory compliance and operational efficiency.

China Financial Services Holdings Reports Significant Turnaround in 2024 Financial Results

China Financial Services Holdings Limited reported a significant turnaround in its financial performance for the year ended December 31, 2024. The company achieved a profit attributable to owners of HK$41.2 million, compared to a loss of HK$159.9 million in the previous year, marking a 125.8% improvement. This positive outcome was driven by a reversal of impairments and liabilities, despite a 22.7% decrease in interest and financing consultancy services income. The results highlight the company’s efforts to stabilize its operations and improve its financial health, which could enhance its industry positioning and stakeholder confidence.

Resignation of Independent Director at China Financial Services Holdings

China Financial Services Holdings Limited announced the resignation of Mr. John Paul Ribeiro as an independent non-executive director, effective March 17, 2025. Mr. Ribeiro resigned to focus on personal engagements and confirmed no disagreements with the board. The company expressed gratitude for his contributions.

China Financial Services Holdings Announces Board Composition and Roles

China Financial Services Holdings Limited, a company incorporated in Hong Kong, has announced the composition of its Board of Directors and their roles within the organization. The Board includes both executive and independent non-executive directors, with Mr. Zhang Min serving as the Chief Executive Officer. The announcement details the membership of the Board committees, highlighting the roles of each director within the Audit, Remuneration, Nomination, and Business Risks Committees. This organizational update may impact the company’s governance structure and operational oversight, potentially influencing stakeholder confidence and strategic decision-making.

China Financial Services Holdings Limited Announces Positive Profit Alert for 2024

China Financial Services Holdings Limited has issued a positive profit alert, indicating a significant turnaround from a net loss of approximately HK$160.0 million in 2023 to an expected net profit of not less than HK$35.0 million for the year ending December 2024. This improvement is attributed to the reversal of liabilities from loan guarantees, a reduction in interest and handling expenses, and a decrease in impairment loss on loan receivables, reflecting a gradual recovery in China’s property market.

China Financial Services Announces HK$38 Million Loan Agreement

China Financial Services Holdings Limited announced a discloseable transaction involving a loan agreement with QLCG as the lender and Customer EX as the borrower. The loan, amounting to HK$38,000,000 with a 13.5% annual interest rate, is secured by commercial properties and guarantees, and is set for a one-year term. This transaction, exceeding certain percentage ratios under Hong Kong’s Listing Rules, requires notification and announcement, reflecting the company’s active engagement in financial assistance and its strategic positioning in the market.

China Financial Services Holdings Limited Announces Discloseable Financial Assistance Transaction

China Financial Services Holdings Limited announced the provision of financial assistance through two secured loans totaling RMB24,000,000 to four associated customers. The loans, which involve significant financial transactions, are classified as a discloseable transaction under Hong Kong’s Listing Rules due to their combined percentage ratios.