Ares Asia Limited (0645) AI Stock Analysis

• Market Cap: HK$86.73M
• Dividend Yield: N/A
• Average Volume (3M): 206.07K
• Price to Earnings (P/E): ―
• Beta (1Y): >-0.01
• Revenue Growth: -98.92%
• EPS Growth: -76.92%
• Country: HK
• Employees: 6
• Sector: Energy
• Sector Strength: 52
• Industry: Coal
• EPS (TTM): -0.01
• Shares Outstanding: 513,175,400
• 10 Day Avg. Volume: 348,000
• 30 Day Avg. Volume: 206,066
• PEG Ratio: -0.06
• Price to Book (P/B): 2.80
• Price to Sales (P/S): 3.88
• P/FCF Ratio: -3.13
• 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: 48 Neutral
• Price Target: HK$0.14 ▲(9.23% Upside)

The score is primarily constrained by very weak financial performance (revenue collapse, persistent losses, and negative operating cash flow), only partly cushioned by low balance-sheet leverage. Technicals are moderately constructive in the short term (price above key short/intermediate moving averages and positive MACD), but valuation remains unattractive due to loss-driven negative P/E and no indicated dividend support.

Positive Factors

Low balance-sheet leverage

Consistently modest debt-to-equity gives the company structural financial flexibility despite operating weakness. Low leverage reduces refinancing and solvency risk, providing runway to restructure operations or await shipping market recovery without immediate capital raises.

Shipping-focused chartering business

A core focus on vessel chartering and shipping aligns the firm with enduring global seaborne trade demand. Chartering exposure can offer recurring contract revenues and operational flexibility versus fixed-asset heavy models, supporting longer-term revenue opportunities when shipping rates normalize.

Positive gross profit in most years

Sustained positive gross profit implies the core transport operations can cover direct voyage and fuel costs. That structural gross-margin buffer means management can potentially restore profitability by cutting overhead or redeploying capacity, supporting medium-term recovery prospects.

Negative Factors

Severe revenue collapse and volatility

A ~93% YoY revenue collapse signals a material erosion of operating scale and customer activity. Persistent top-line volatility undermines fixed-cost absorption, makes forecasting and contract negotiation harder, and raises durable questions about market position and revenue sustainability.

Persistent net losses and weak margins

Chronic annual net losses and deeply negative operating margins erode equity and limit reinvestment capacity. Over time this impairs ability to modernize fleet or secure long-term charters, forcing either strategic overhaul or external capital support to restore viable profitability.

Negative and inconsistent operating cash flow

Frequent negative operating cash flow indicates the business cannot reliably self-fund operations or capex. Even with a low leverage profile, persistent cash burn creates liquidity pressure, heightens dependence on external financing, and limits capacity to pursue growth or weather downturns.

Ares Asia Limited Business Overview & Revenue Model

Company Description

Ares Asia Limited engages in the coal trading business. It primarily sells thermal coal purchased from various countries to the People's Republic of China. The company was formerly known as KTP Holdings Limited and changed its name to Ares Asia Limited in April 2012. The company was incorporated in 1993 and is headquartered in Kowloon, Hong Kong. Ares Asia Limited is a subsidiary of Reignwood International Holdings Company Limited.

How the Company Makes Money

Ares Asia Limited makes money through its trading operations in the thermal coal market. The company purchases coal from producers and sells it to end-users, such as power plants and industrial users, primarily in Asian countries where coal remains a significant energy source. Revenue is generated from the margin between the purchase price and the selling price of coal. The company may also engage in long-term supply agreements with key clients, providing a stable revenue stream. Additionally, Ares Asia Limited's earnings can be influenced by fluctuations in coal prices, transportation costs, and its ability to manage supply chain efficiencies.

Ares Asia Limited Financial Statement Overview

Summary

Income statement and cash flow are very weak: revenue collapsed (~93% YoY in 2025), losses are persistent with sharply negative margins, and operating cash flow has been negative in most years and worsened in 2025. The main offset is a comparatively low-leverage balance sheet (modest debt-to-equity), but shrinking assets and negative returns on equity indicate limited value creation.

Income Statement

Revenue has been highly volatile and recently collapsed (2025 revenue down ~93% year-over-year), signaling a major contraction in activity. Profitability is consistently weak: the company has posted net losses every year provided, and 2025 margins deteriorated sharply (net margin around -71% with deeply negative operating profitability). A modest positive is that gross profit has stayed positive in most years, but the very thin gross margins and persistent operating losses dominate the picture.

Balance Sheet

Leverage appears low, with debt-to-equity consistently modest across the period, which reduces financial stress and refinancing risk. However, equity returns are persistently negative (loss-making years translate into negative returns on shareholders’ equity), indicating weak value creation. Assets also declined materially versus earlier years, pointing to a smaller balance sheet and potentially reduced earning capacity.

Cash Flow

Cash generation is inconsistent and recently pressured: operating cash flow has been negative in most years and worsened significantly in 2025. While 2022 showed a large positive operating and free cash flow, it was not sustained, raising questions about durability and working-capital swings. Free cash flow broadly tracks net income (often near 1x), but because both are frequently negative, that linkage does not translate into healthy cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.32M	3.32M	70.38M	52.59M	101.56M	117.51M
Gross Profit	101.00K	101.00K	331.00K	1.06M	408.00K	869.00K
EBITDA	-2.37M	-2.25M	-1.25M	-753.00K	-1.83M	-1.78M
Net Income	-2.36M	-2.36M	-1.26M	-829.00K	-2.13M	-2.26M
Balance Sheet
Total Assets	5.13M	5.13M	7.82M	19.17M	24.62M	47.60M
Cash, Cash Equivalents and Short-Term Investments	1.90M	1.90M	6.26M	7.70M	8.78M	9.17M
Total Debt	221.00K	221.00K	139.00K	341.00K	533.00K	31.26M
Total Liabilities	530.00K	530.00K	865.00K	10.95M	15.57M	36.42M
Stockholders Equity	4.60M	4.60M	6.96M	8.22M	9.05M	11.18M
Cash Flow
Free Cash Flow	-4.11M	-4.11M	-1.23M	-1.78M	31.13M	-27.82M
Operating Cash Flow	-4.11M	-4.11M	-1.21M	-1.75M	31.13M	-27.82M
Investing Cash Flow	0.00	0.00	-20.00K	878.00K	-2.00K	-900.00K
Financing Cash Flow	-253.00K	-253.00K	-210.00K	-210.00K	-31.52M	27.46M

Ares Asia Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.13
• 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:0645, the sentiment is Positive. The current price of 0.13 is below the 20-day moving average (MA) of 0.13, above the 50-day MA of 0.13, and below the 200-day MA of 0.14, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 78.96 is Negative, neither overbought nor oversold. The STOCH value of 97.13 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0645.

Ares Asia Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
0645	48 Neutral	HK$86.73M	-4.59	-47.78%	―	-98.92%	-76.92%
0276	46 Neutral	HK$137.33M	-0.08	―	―	-38.71%	-193.94%
0065	45 Neutral	HK$76.12M	-1.24	-31.67%	―	-20.97%	-213.53%
0704	43 Neutral	HK$95.10M	-1.07	-3.24%	―	―	―
1738	42 Neutral	HK$173.95M	-0.25	―	―	-42.18%	-3.23%
8203	39 Underperform	HK$151.00M	-10.11	―	―	47.32%	2.60%

Ares Asia Limited Corporate Events

Ares Asia Limited Updates Nomination Committee Composition

Ares Asia Limited has announced a change in the composition of its Nomination Committee, effective November 28, 2025. This change involves the appointment of Ms. Ruayrungruang Woraphanit as a member, aligning with the revised Corporate Governance Code set to be effective from July 1, 2025, which may impact the company’s governance structure and compliance.

Ares Asia Limited Updates Nomination Committee Terms

Ares Asia Limited has revised the terms of reference for its Nomination Committee as of November 28, 2025. The committee is structured to include at least three members, with a majority being independent non-executive directors, and emphasizes diversity by requiring at least one member of a different gender. This revision aims to enhance corporate governance and ensure a diverse and independent oversight in the nomination process, potentially impacting the company’s governance structure positively.

Ares Asia Limited Reports Interim Financial Losses Amid Revenue Decline

Ares Asia Limited reported its unaudited interim results for the six months ending September 30, 2025, revealing a significant decline in revenue from the previous year, with figures dropping from US$3,317,000 in 2024 to US$493,000 in 2025. The company experienced a loss from operations amounting to US$717,000, compared to a loss of US$648,000 in the same period last year, indicating ongoing financial challenges. The announcement highlights the company’s struggle to maintain profitability, which could affect its market positioning and stakeholder confidence.

Ares Asia Limited Announces Board Composition and Roles

Ares Asia Limited has announced the composition of its board of directors and their respective roles within the company. The board includes executive directors, non-executive directors, and independent non-executive directors, with specific members assigned to the Audit, Remuneration, and Nomination Committees. This announcement provides clarity on the governance structure of the company, which is crucial for maintaining transparency and effective management, potentially impacting stakeholder confidence and the company’s strategic direction.

Ares Asia Limited Schedules Board Meeting for Interim Results Review

Ares Asia Limited has announced that its board of directors will meet on November 28, 2025, to review and approve the interim financial results for the six months ending September 30, 2025, and to consider the payment of an interim dividend. This meeting is significant as it will provide insights into the company’s financial health and potential returns for shareholders.