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China Literature Ltd. (HK:0772)
:0772

China Literature (0772) AI Stock Analysis

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HK

China Literature

(OTC:0772)

Rating:61Neutral
Price Target:
HK$29.00
▼(-0.68%Downside)
The stock's score is primarily supported by strong cash flow and a solid balance sheet, despite profitability issues. Technical indicators show neutral momentum, while the valuation is negatively impacted by the net loss and lack of dividend yield.

China Literature (0772) vs. iShares MSCI Hong Kong ETF (EWH)

China Literature Business Overview & Revenue Model

Company DescriptionChina Literature Limited, an investment holding company, operates an online literature platform in the People's Republic of China. The company promotes intellectual properties primarily through its online literature platforms, such as QQ Reading and Qidian; and New Classics Media, a film and TV drama series production house. It is also involved in the self-operated channels business on partner distribution platforms. In addition, the company licenses the content to third-party partners for distribution, as well as offers online paid reading and content adaptations into various entertainment formats. Further, it provides reading, copyright commercialization, and writer cultivation and brokerage services; and operates text work reading and related open platform through technology methods and digital media, including personal computers, Internet, and mobile network. Additionally, the company engages in the production and distribution of television series, web series, and films; licensing and distribution of film and television properties; licensing copyrights; sale of physical books; and operation of in-house online games, etc. The company was founded in 2002 and is headquartered in Shanghai, the People's Republic of China. China Literature Limited is a subsidiary of Tencent Holdings Limited.
How the Company Makes MoneyChina Literature makes money through a multifaceted revenue model that includes online reading services, IP operations, and content licensing. The company generates revenue by offering premium content through subscriptions and pay-per-view models on its digital platforms. In addition, it monetizes its vast library of works by licensing content to third parties for adaptation into films, TV series, and games. Significant partnerships with media production companies enhance its IP development capabilities, further contributing to its revenue. Advertising services on its platforms also provide an additional income stream.

China Literature Financial Statement Overview

Summary
Income Statement
Balance Sheet
Cash Flow
Breakdown
TTMDec 2023Dec 2022Dec 2021Dec 2020Dec 2019
Income StatementTotal Revenue
7.92B7.01B7.63B8.67B8.53B8.35B
Gross Profit
3.85B3.37B4.03B4.60B4.23B3.69B
EBIT
852.81M709.31M1.42B1.25B966.43M1.19B
EBITDA
956.56M1.22B1.20B1.75B-2.62B1.61B
Net Income Common Stockholders
932.50M804.88M608.19M1.85B-4.50B1.10B
Balance SheetCash, Cash Equivalents and Short-Term Investments
628.54M6.28B7.51B7.21B6.26B6.35B
Total Assets
6.38B23.19B22.73B23.30B21.32B26.25B
Total Debt
878.18M238.10M617.98M1.45B1.33B1.39B
Net Debt
547.09M-2.56B-4.93B-3.08B-1.52B-4.54B
Total Liabilities
1.92B4.16B4.78B6.11B6.22B6.84B
Stockholders Equity
4.38B19.02B17.96B17.19B15.09B19.40B
Cash FlowFree Cash Flow
2.10B954.13M1.25B879.35M821.95M565.92M
Operating Cash Flow
2.13B1.13B1.58B1.12B1.11B782.50M
Investing Cash Flow
-2.48B-3.39B528.10M936.23M-4.19B-1.29B
Financing Cash Flow
-107.68M-510.82M-1.15B-349.99M-92.34M-1.93B

China Literature Technical Analysis

Technical Analysis Sentiment
Positive
Last Price29.20
Price Trends
50DMA
26.35
Positive
100DMA
26.73
Positive
200DMA
26.83
Positive
Market Momentum
MACD
0.67
Negative
RSI
61.76
Neutral
STOCH
79.37
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0772, the sentiment is Positive. The current price of 29.2 is above the 20-day moving average (MA) of 27.06, above the 50-day MA of 26.35, and above the 200-day MA of 26.83, indicating a bullish trend. The MACD of 0.67 indicates Negative momentum. The RSI at 61.76 is Neutral, neither overbought nor oversold. The STOCH value of 79.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0772.

China Literature Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
61
Neutral
$14.60B5.88-4.32%3.68%2.75%-30.55%
61
Neutral
$29.74B27.55-1.14%13.74%-125.64%
$3.84B33.8717.66%
€2.70B12.466.58%7.57%
72
Outperform
HK$18.44B7.1610.79%8.44%0.43%21.65%
67
Neutral
HK$8.60B45.352.01%-15.71%-80.38%
54
Neutral
HK$2.76B-0.40%-19.99%98.97%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:0772
China Literature
29.20
2.70
10.19%
MEIUF
Meitu
0.86
0.48
126.32%
DE:8AHA
Autohome Inc Class A
5.25
-0.62
-10.56%
HK:9898
Weibo Corp Class A
77.20
17.77
29.90%
HK:1896
Maoyan Entertainment
7.80
-0.71
-8.34%
HK:2390
Zhihu, Inc. Class A
10.64
1.92
22.02%

China Literature Corporate Events

China Literature Expands Stake in Target Company with Strategic Acquisition
May 30, 2025

China Literature Limited has announced a significant acquisition, where its PRC operating entity, Shanghai Hongwen, has agreed to acquire a 26.67% equity interest in a target company for approximately RMB324.80 million. This acquisition will increase China Literature’s stake in the target company to 31.48%, although the target will not become a subsidiary, and its financials will remain separate. This transaction is classified as a connected transaction under Hong Kong’s Listing Rules due to Tencent’s involvement, a major shareholder in both China Literature and the target company.

The most recent analyst rating on (HK:0772) stock is a Buy with a HK$32.00 price target. To see the full list of analyst forecasts on China Literature stock, see the HK:0772 Stock Forecast page.

China Literature Limited Successfully Passes All Resolutions at 2025 AGM
May 30, 2025

China Literature Limited held its Annual General Meeting (AGM) on May 30, 2025, where all proposed resolutions were passed by poll. The resolutions included the re-election of directors, authorization of director remuneration, re-appointment of auditors, and granting of mandates to the directors for share issuance and buyback. The successful passing of these resolutions indicates strong shareholder support and positions the company for continued operational stability and strategic growth.

The most recent analyst rating on (HK:0772) stock is a Buy with a HK$32.00 price target. To see the full list of analyst forecasts on China Literature stock, see the HK:0772 Stock Forecast page.

China Literature Limited Announces 2025 Annual General Meeting
Apr 22, 2025

China Literature Limited has announced its upcoming annual general meeting scheduled for May 30, 2025, in Hong Kong. Key agenda items include the consideration of audited financial statements, re-election of directors, and re-appointment of auditors. The meeting will also address resolutions related to the issuance of additional shares and related securities, reflecting the company’s strategic focus on expanding its financial and operational capabilities. This announcement underscores the company’s commitment to maintaining robust corporate governance and enhancing shareholder value.

China Literature Reports 2024 Results, Boosted by IP Success and AI Integration
Mar 18, 2025

China Literature Limited reported its annual results for 2024, showing a 15.8% increase in revenues to RMB 8.1 billion, despite an operating loss of RMB 336 million. The company highlighted the success of its IP operations, with revenues rising 34% year-over-year, driven by blockbuster titles and the commercialization of popular content like ‘Ne Zha 22.’ The integration of AI technologies, such as the DeepSeek-R1 model in their ‘Writer Assistant’ tool, has enhanced content creation, leading to significant growth in user engagement and new writer income. These developments underscore China Literature’s strategic focus on quality content and technological innovation, reinforcing its leading position in the industry.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.