China National Culture Group Limited (0745) AI Stock Analysis

• Market Cap: HK$182.81M
• Dividend Yield: N/A
• Average Volume (3M): 91.74K
• Price to Earnings (P/E): 23.2
• Beta (1Y): 1.07
• Revenue Growth: 56.81%
• EPS Growth: N/A
• Country: HK
• Employees: 22
• Sector: Communication Services
• Sector Strength: 97
• Industry: Advertising Agencies
• EPS (TTM): 0.07
• Shares Outstanding: 234,366,460
• 10 Day Avg. Volume: 94,150
• 30 Day Avg. Volume: 91,736
• PEG Ratio: 0.02
• Price to Book (P/B): 0.23
• Price to Sales (P/S): 0.24
• P/FCF Ratio: -10.86
• 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: 49 Neutral
• Price Target: HK$0.78 ▲(4.86% Upside)

The score is held back primarily by weak financial quality—ongoing net losses and persistently negative operating/free cash flow—despite a strong 2025 revenue rebound and low balance-sheet leverage. Technicals are constructive with an uptrend, but elevated RSI signals near-term overheating risk. Valuation is mid-range (P/E ~23.2) with no dividend support provided.

Positive Factors

Revenue rebound (2025)

A ~51% revenue rebound in 2025 shows meaningful demand recovery and reaccelerated top-line growth. Durable revenue momentum can enable scale economies, support reinvestment in core services, and provide a runway for converting operating improvements into sustained net profitability if maintained.

Very low leverage

Effectively zero debt materially reduces refinancing and interest-rate risk and preserves strategic flexibility. A debt-light balance sheet supports investment or M&A optionality, cushions operating volatility, and lowers fixed obligations, improving survival odds during cyclic advertising downturns.

Improved operating profitability

A positive EBIT margin (~10.7%) signals the core advertising business can generate operating profits after the 2025 recovery. Sustained operating margin expansion is a durable driver of future free cash flow and provides a structural pathway to eventual net profitability if non-operating drains are addressed.

Negative Factors

Persistent net losses

Despite operating gains, a ~-10.9% net margin in 2025 shows non-operating items or one-offs still push the firm into losses. Continued bottom-line deficits erode equity, restrict retained-capital accumulation, and mean the company must fix structural cost or non-operating issues to deliver lasting shareholder returns.

Negative operating and free cash flow

Persistent negative operating and free cash flow indicates the business has not been self-funding, forcing reliance on external capital. This structural cash burn limits ability to invest organically, raises liquidity risk during weaker cycles, and can dilute shareholders if financing is required.

Volatile results and negative ROE

High historical earnings volatility and negative ROE signal inconsistent execution and damage to the equity base. This structural volatility makes forecasting and capital planning harder, deters long-term investors, and impairs the firm's ability to rebuild reserves and finance growth from retained earnings.

China National Culture Group Limited Business Overview & Revenue Model

Company Description

China National Culture Group Limited, an investment holding company, provides advertising and value-added services through mobile devices in the People's Republic of China and Hong Kong. It operates through Advertising, Movie, and E-commerce segments. The company also trades in and produces films; offers other film related services; and sells products through Internet. In addition, it is involved in the operation of a website; food and beverages industry advertising business; and provision of communication marketing platform services. The company was formerly known as China Railsmedia Corporation Limited and changed its name to China National Culture Group Limited in March 2014. China National Culture Group Limited was incorporated in 2002 and is headquartered in Sheung Wan, Hong Kong.

How the Company Makes Money

China National Culture Group Limited generates revenue through multiple channels within the cultural and entertainment industries. Key revenue streams include box office receipts from film production and distribution, ticket sales from cultural events and exhibitions, and advertising revenue from media-related services. Additionally, the company may engage in strategic partnerships and collaborations with other media companies and cultural institutions to enhance its offerings and expand its market reach, thus contributing to its earnings.

China National Culture Group Limited Financial Statement Overview

Summary

Strong 2025 revenue rebound and improved operating profitability (positive EBIT margin) support the score, and the balance sheet has minimal leverage. However, the company is still loss-making at the net level and has mostly negative operating/free cash flow in recent years, indicating weak cash conversion and ongoing execution risk.

Income Statement

Revenue rebounded strongly in 2025 (annual revenue up ~51% vs. 2024), and operating profitability improved materially with positive EBIT margin (~10.7%). However, the company remains loss-making at the bottom line in 2025 (net margin ~-10.9%), and results have been highly volatile over the last several years (very large losses in 2020–2022 and 2024, plus uneven revenue trends). Overall, improving trajectory in the most recent year, but profitability is not yet consistently durable.

Balance Sheet

The balance sheet is conservatively structured with effectively no debt (debt-to-equity at or near 0 across the period), which reduces financial risk and refinancing pressure. The main weakness is shareholder returns: return on equity remains negative in 2025 (~-10.7%) and was deeply negative in 2024, reflecting ongoing losses and meaningful equity erosion versus earlier years.

Cash Flow

Cash generation is a key pressure point: operating cash flow and free cash flow are negative in 2025 and were also negative in most recent years (2022–2024), indicating the business has not been consistently self-funding. While free cash flow improved versus 2024 in absolute terms (less negative), the overall pattern shows persistent cash burn and weak cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	43.71M	43.71M	27.88M	43.02M	67.46M	78.09M
Gross Profit	3.95M	3.95M	5.44M	18.55M	23.04M	23.13M
EBITDA	3.87M	4.68M	0.00	5.28M	-9.95M	-17.96M
Net Income	-4.78M	-4.78M	-43.67M	-1.50M	-34.55M	-56.32M
Balance Sheet
Total Assets	51.88M	51.88M	32.04M	78.01M	87.10M	101.81M
Cash, Cash Equivalents and Short-Term Investments	32.17M	32.17M	14.64M	27.59M	25.68M	25.91M
Total Debt	0.00	0.00	0.00	0.00	0.00	0.00
Total Liabilities	7.30M	7.30M	15.29M	17.02M	30.77M	35.96M
Stockholders Equity	44.58M	44.58M	16.75M	60.98M	56.34M	65.85M
Cash Flow
Free Cash Flow	-955.00K	-955.00K	-5.64M	-3.58M	-8.50M	376.00K
Operating Cash Flow	-955.00K	-955.00K	-5.64M	-3.58M	-8.50M	376.00K
Investing Cash Flow	-34.00K	-34.00K	0.00	-1.40M	-10.68M	-4.92M
Financing Cash Flow	15.30M	15.30M	0.00	6.81M	18.51M	6.16M

China National Culture Group Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
8121	55 Neutral	HK$27.61M	-6.83	-7.45%	―	34.13%	-139.87%
8627	54 Neutral	HK$63.20M	-18.97	-3.32%	―	-55.47%	-205.41%
0745	49 Neutral	HK$182.81M	23.21	31.70%	―	56.81%	―
8238	49 Neutral	HK$80.12M	-1.12	―	―	22.85%	76.33%
8153	46 Neutral	HK$27.04M	-0.42	-55.12%	―	-16.79%	62.70%

China National Culture Group Limited Corporate Events

China National Culture Group Announces 2025 Interim Results

China National Culture Group Limited has announced its unaudited interim results for the six months ending September 30, 2025. This announcement complies with the Hong Kong Stock Exchange’s listing rules and provides stakeholders with insights into the company’s financial performance and strategic direction.

China National Culture Group Partners with Gansu Performing Arts for Global Stage Play Venture

China National Culture Group Limited has announced a non-legally binding memorandum of understanding with Gansu Performing Arts Group to establish a joint venture focused on the global performance and promotion of a stage play. This collaboration is expected to expand the company’s movie segment and enhance its presence in the PRC market by leveraging the extensive local network and reputation of the state-owned Gansu Performing Arts Group.

China National Culture Group Projects HK$18 Million Profit for H2 2025

China National Culture Group Limited has announced an expected net profit of approximately HK$18 million for the six months ending 30 September 2025, driven by increased revenue, gross profit, and fair value gains on financial assets. The interim results, based on unaudited management accounts, are yet to be finalized and reviewed, with full financial results anticipated by the end of November 2025.

China National Culture Group Schedules Board Meeting to Discuss Interim Results and Dividends

China National Culture Group Limited has announced a forthcoming board meeting scheduled for November 28, 2025. The meeting will focus on approving the interim results for the company and its subsidiaries, and considering the payment of an interim dividend for the six months ending September 30, 2025. This announcement indicates the company’s ongoing efforts to maintain transparency and shareholder engagement by updating stakeholders on its financial performance and potential dividend distribution.