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VSTECS Holdings Limited (HK:0856)
:0856
Hong Kong Market
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VSTECS Holdings Limited (0856) AI Stock Analysis

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HK:0856

VSTECS Holdings Limited

(0856)

Rating:74Outperform
Price Target:
HK$11.00
▲(1.29% Upside)
The overall stock score of VSTECS Holdings Limited is positively influenced by strong financial performance, particularly in revenue growth and profitability. However, liquidity concerns reflected in the cash flow statement and overbought technical indicators present risks. The valuation is fair, but improved cash management is needed for sustainable growth.
Positive Factors
Cloud Computing
Cloud computing business delivered robust growth with revenue up by 68% YoY, mainly attributable to strong demand for AI computing power and deepened cooperation with leading hyperscalers.
Financial Performance
Total revenue increased by 14% YoY to HK$45.5bn, with net profit up by 36% YoY to HK$649mn, driven by strong demand for AI computing power.
Market Expansion
VSTECS is expected to continue benefiting from the growing demand for AI computing power as one of the leading distributors of AI chips and computing power in Asia.
Negative Factors
Profit Margins
GPM was down by 0.3ppt YoY to 4.4%, primarily due to the intense competition in the domestic market and increased revenue contribution from AI server distribution, which tends to have a lower GPM.

VSTECS Holdings Limited (0856) vs. iShares MSCI Hong Kong ETF (EWH)

VSTECS Holdings Limited Business Overview & Revenue Model

Company DescriptionVSTECS Holdings Limited, an investment holding company, develops information technology (IT) product channel and provides technical solution integration services in North Asia and South East Asia. It operates through three segments: Enterprise Systems, Consumer Electronics, and Cloud Computing. The Enterprise Systems segment provides enterprise system tools, such as middleware, operating systems, Unix/NT servers, databases, and storage equipment for IT infrastructure; and IT infrastructure design and implementation, training, maintenance, and support services. The Consumer Electronics segment offers finished IT products, including computers, mobile phones, drones, smart sports watches, 3D printers, game consoles, etc. The Cloud Computing segment provides cloud computing solutions and services. The company is also involved in the retail of IT products, equipment, and accessories; import and export of IT products; and provision of supply chains management and warehouse transport, electronic settlement business center, and project investment and marketing research services. It serves individuals, small and medium enterprises, large corporations, and government entities through a distribution network of resellers comprising retailers, system integrators, and corporate dealers. The company was formerly known as VST Holdings Limited and changed its name to VSTECS Holdings Limited in June 2017. VSTECS Holdings Limited was founded in 1991 and is headquartered in Central, Hong Kong.
How the Company Makes MoneyVSTECS Holdings Limited generates revenue primarily through the distribution of ICT products and services. The company acts as an intermediary between global technology vendors and end-users, earning margins on the products it distributes, which include computers, network equipment, software, and peripherals. Additionally, VSTECS offers value-added services such as system integration, technical support, and consulting, which provide additional revenue streams. Strategic partnerships with major technology brands enhance its product offerings and market reach, contributing significantly to its earnings. The company's revenue model benefits from its extensive distribution network across Asia, enabling it to leverage economies of scale and establish a strong presence in the ICT market.

VSTECS Holdings Limited Financial Statement Overview

Summary
VSTECS Holdings Limited shows strong revenue growth and profitability improvements, particularly in the income statement. However, the balance sheet reveals moderate leverage, and the cash flow statement indicates potential liquidity issues with zero operating cash flow in 2024. Overall, the company is growing but should focus on improving cash management to ensure sustainable financial health.
Income Statement
80
Positive
The income statement shows a strong performance, with a solid gross profit margin of 4.41% in 2024, indicating efficient cost management. The net profit margin increased to 1.18%, reflecting improved profitability. Revenue grew by 20.53% from 2023 to 2024, demonstrating robust growth. EBIT and EBITDA margins also saw slight improvements, suggesting operational efficiency.
Balance Sheet
75
Positive
The balance sheet is stable with a debt-to-equity ratio of 1.12, indicating moderate leverage which is manageable but should be monitored. The return on equity (ROE) improved to 12.18%, showing effective use of equity to generate profits. The equity ratio is 22.51%, suggesting a balanced capital structure but highlighting reliance on liabilities.
Cash Flow
60
Neutral
The cash flow statement reflects challenges with cash management as operating cash flow was zero in 2024. The free cash flow growth rate is unavailable due to zero free cash flow, and the operating cash flow to net income ratio cannot be calculated. Improvements in cash flow management are necessary to enhance liquidity.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue89.09B73.89B77.32B78.34B69.96B
Gross Profit3.93B3.50B3.37B3.64B3.13B
EBITDA1.75B1.62B1.47B1.73B1.48B
Net Income1.05B922.03M823.07M1.31B1.07B
Balance Sheet
Total Assets38.39B35.02B34.77B32.18B29.43B
Cash, Cash Equivalents and Short-Term Investments5.44B4.13B8.23B4.38B4.05B
Total Debt9.68B8.44B8.65B6.53B7.01B
Total Liabilities29.52B26.80B27.11B24.27B22.60B
Stockholders Equity8.64B8.22B7.66B7.91B6.83B
Cash Flow
Free Cash Flow1.69B601.41M-171.90M527.57M2.42B
Operating Cash Flow1.82B640.23M-147.87M580.07M2.45B
Investing Cash Flow-300.93M137.76M-517.66M-47.04M-36.37M
Financing Cash Flow-837.13M-1.37B1.25B-942.10M-1.45B

VSTECS Holdings Limited Technical Analysis

Technical Analysis Sentiment
Positive
Last Price10.86
Price Trends
50DMA
9.29
Positive
100DMA
7.69
Positive
200DMA
6.49
Positive
Market Momentum
MACD
0.55
Positive
RSI
60.64
Neutral
STOCH
17.30
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0856, the sentiment is Positive. The current price of 10.86 is above the 20-day moving average (MA) of 10.62, above the 50-day MA of 9.29, and above the 200-day MA of 6.49, indicating a bullish trend. The MACD of 0.55 indicates Positive momentum. The RSI at 60.64 is Neutral, neither overbought nor oversold. The STOCH value of 17.30 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:0856.

VSTECS Holdings Limited Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
HK$15.76B12.7813.99%2.37%18.23%38.95%
61
Neutral
$36.05B6.66-10.10%1.86%8.68%-8.81%
€437.36M15.034.79%
73
Outperform
HK$2.34B5.9113.40%5.10%6.01%9.76%
73
Outperform
HK$884.51M8.4510.77%6.70%-17.97%46.24%
69
Neutral
HK$2.84B6.6014.95%8.81%-0.06%-6.11%
53
Neutral
HK$478.42M68.252.38%20.64%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:0856
VSTECS Holdings Limited
10.91
6.78
164.16%
DE:7C3
Cogobuy Group
0.27
0.16
145.45%
HK:1184
S.A.S. Dragon Holdings Limited
4.55
0.92
25.34%
HK:2166
Smart-Core Holdings Ltd.
1.96
0.81
70.43%
HK:3991
Changhong Jiahua Holdings Ltd.
0.93
0.49
111.36%
HK:6036
Apex Ace Holding Ltd.
0.44
0.00
0.00%

VSTECS Holdings Limited Corporate Events

VSTECS Holdings Limited Announces Board Composition and Committee Roles
Aug 8, 2025

VSTECS Holdings Limited has announced the composition of its Board of Directors, highlighting the roles and functions of each member. The board includes a mix of executive, non-executive, and independent non-executive directors, with committees dedicated to audit, remuneration, and nomination. This announcement underscores the company’s commitment to strong corporate governance and strategic leadership, which is crucial for maintaining its competitive edge in the technology sector.

VSTECS Holdings Announces Board and Committee Changes
Aug 8, 2025

VSTECS Holdings Limited announced significant changes in its board of directors and committee composition. Mr. Yu Dingheng has resigned as an independent non-executive director (INED) to focus on his investment management company, and Dr. Gao Bin has been appointed as his successor. Dr. Gao brings extensive experience in finance and investment, having held leadership roles in various financial institutions, and will serve as the chairman of the Audit Committee and a member of the Remuneration and Nomination Committees. This transition is expected to strengthen the company’s governance and strategic direction.

VSTECS Holdings to Review Interim Results and Dividend
Aug 1, 2025

VSTECS Holdings Limited has announced a board meeting scheduled for August 21, 2025, to discuss and approve the interim results for the first half of the year ending June 30, 2025. The meeting will also consider the recommendation of an interim dividend and address any other business matters, potentially impacting the company’s financial strategy and shareholder returns.

VSTECS Holdings to Mitigate Forex Risks with Innovative Payment System
Jul 28, 2025

VSTECS Holdings Limited has announced its intention to collaborate with a third-party service provider to implement financial solutions aimed at mitigating foreign exchange risks through stablecoin-based cross-border payments. This strategic move is expected to reduce operational costs and enhance profitability stability amidst geopolitical uncertainties in ASEAN, although no binding agreements have been finalized yet.

VSTECS Holdings Explores Stablecoin Solutions for Southeast Asia
Jul 14, 2025

VSTECS Holdings Limited has initiated discussions to explore stablecoin payment and settlement solutions, aiming to enhance cross-border trade efficiency and optimize supply chain liquidity in Southeast Asia. The discussions are in preliminary stages, with no binding agreements yet, and focus on using compliant stablecoins to reduce transaction costs and exchange rate risks.

VSTECS Holdings Limited Announces Share Option Grant to Employees
Jun 23, 2025

VSTECS Holdings Limited has announced the grant of 29,400,000 share options to its employees, including all directors, under its share option scheme. The options, exercisable at a price of HK$7.29 per share, are subject to performance targets related to revenue growth of a specified subsidiary. This initiative aims to incentivize employees and align their interests with the company’s growth objectives, potentially impacting the company’s operational focus and stakeholder engagement.

VSTECS Holdings Limited Successfully Passes All AGM Resolutions
May 22, 2025

VSTECS Holdings Limited announced that all proposed resolutions at their Annual General Meeting on May 22, 2025, were passed as ordinary resolutions. Key resolutions included the approval of financial statements, the declaration of a final dividend, re-election of directors, and granting of mandates for share issuance and repurchase. The successful passing of these resolutions reflects strong shareholder support and positions the company for continued operational and strategic initiatives.

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: Jul 16, 2025