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Ares Asia Limited (HK:0645)
:0645
Hong Kong Market

Ares Asia Limited (0645) AI Stock Analysis

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HK

Ares Asia Limited

(0645)

Rating:55Neutral
Price Target:
The stock of Ares Asia Limited scores 55, primarily weighed down by financial struggles, including declining revenues and negative cash flows which pose liquidity risks. Despite these concerns, the stock shows positive technical trends with strong price movement above key averages. However, valuation remains a concern due to negative earnings and lack of dividends, reflecting ongoing operational challenges.

Ares Asia Limited (0645) vs. iShares MSCI Hong Kong ETF (EWH)

Ares Asia Limited Business Overview & Revenue Model

Company DescriptionAres 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 MoneyAres 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
Ares Asia Limited faces significant financial challenges, with declining revenues and persistent losses impacting profitability. Its balance sheet remains relatively stable with low leverage, but cash flow issues highlight liquidity risks. The company must address operational inefficiencies to improve financial health and enable growth.
Income Statement
45
Neutral
The company has experienced declining revenue over recent years, with a notable drop from 2020 to 2024. Gross profit margins are thin, and the company has consistently reported net losses, indicating challenges in profitability. Revenue growth showed volatility, with a significant decline in the most recent period.
Balance Sheet
65
Positive
The balance sheet shows a strong equity position compared to liabilities, with the equity ratio indicating financial stability. The company has maintained low levels of debt, resulting in a favorable debt-to-equity ratio. However, the declining asset base is a concern for future operations.
Cash Flow
40
Negative
Cash flow analysis reveals negative operating cash flows, putting pressure on liquidity. Free cash flow has also been negative in recent periods, reflecting operational challenges. The cash position is declining, which could hamper future investments or debt servicing.
BreakdownTTMMar 2024Mar 2023Mar 2022Mar 2021Mar 2020
Income Statement
Total Revenue45.77M70.38M52.59M101.56M117.51M99.87M
Gross Profit257.00K331.00K1.06M408.00K869.00K1.27M
EBITDA-1.35M-1.25M-753.00K-1.83M-1.78M88.00K
Net Income-1.36M-1.26M-829.00K-2.13M-2.26M-689.00K
Balance Sheet
Total Assets7.20M7.82M19.17M24.62M47.60M29.98M
Cash, Cash Equivalents and Short-Term Investments2.77M6.26M7.70M8.78M9.17M10.43M
Total Debt369.00K139.00K341.00K533.00K139.00K377.00K
Total Liabilities892.00K865.00K10.95M15.57M36.42M16.54M
Stockholders Equity6.31M6.96M8.22M9.05M11.18M13.44M
Cash Flow
Free Cash Flow-1.47M-1.23M-1.78M31.13M-27.82M218.00K
Operating Cash Flow-1.45M-1.21M-1.75M31.13M-27.82M218.00K
Investing Cash Flow-20.00K-20.00K878.00K-2.00K-900.00K1.00K
Financing Cash Flow-202.00K-210.00K-210.00K-31.52M27.46M6.36M

Ares Asia Limited Technical Analysis

Technical Analysis Sentiment
Negative
Last Price0.11
Price Trends
50DMA
0.16
Negative
100DMA
0.17
Negative
200DMA
0.12
Negative
Market Momentum
MACD
-0.01
Negative
RSI
28.37
Positive
STOCH
38.89
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0645, the sentiment is Negative. The current price of 0.11 is below the 20-day moving average (MA) of 0.12, below the 50-day MA of 0.16, and below the 200-day MA of 0.12, indicating a bearish trend. The MACD of -0.01 indicates Negative momentum. The RSI at 28.37 is Positive, neither overbought nor oversold. The STOCH value of 38.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:0645.

Ares Asia Limited Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
63
Neutral
$6.99B18.83-1.16%6.86%4.65%-25.28%
55
Neutral
HK$57.48M-40.71%-27.98%-16.20%
$17.42M
$15.10M0.05
HK$77.75M-35.91%
HK$84.72M-3.24%
47
Neutral
HK$153.85M17.95
272.07%
* Real Estate Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:0645
Ares Asia Limited
0.11
0.02
22.22%
FSHRF
Feishang Anthracite Resources
0.01
-0.01
-50.00%
MOAEF
Mongolia Energy
0.06
-0.04
-40.00%
HK:0065
Grand Ocean Advanced Resources Co., Ltd.
0.38
-0.90
-70.31%
HK:0704
Huscoke Holdings Limited
0.10
0.01
11.11%
HK:8203
Kaisun Holdings Limited
0.27
-0.08
-22.86%

Ares Asia Limited Corporate Events

Ares Asia Limited Announces Key Management Changes
Apr 25, 2025

Ares Asia Limited has announced a change in its company secretary and authorized representative roles, effective April 25, 2025. Ms. Fung Mei Ling has resigned from her position, and Mr. Lee Tsi Fun, Nicholas, with over 20 years of experience in international audit firms and listed companies, has been appointed as her successor.

Ares Asia Initiates Arbitration Over Coal Purchase Dispute
Feb 26, 2025

Ares Asia Limited has announced that its subsidiary, Ares Asia Resources Pte. Ltd., has initiated arbitration proceedings against a Singaporean supplier due to a contractual dispute over a coal purchase agreement. The arbitration seeks compensation for damages and costs totaling USD3,833,500. The outcome of this arbitration could impact the recoverability of receivables from an end customer, amounting to approximately USD3,317,000, and potentially affect the company’s financial position. The company is actively seeking legal advice and will update stakeholders as the situation develops.

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: Apr 07, 2025