VSTECS Holdings Limited (0856) AI Stock Analysis

• Market Cap: HK$10.30B
• Dividend Yield: 3.79%
• Average Volume (3M): 7.52M
• Price to Earnings (P/E): 9.5
• Beta (1Y): 0.93
• Revenue Growth: 20.56%
• EPS Growth: 14.73%
• Country: HK
• Employees: 5,622
• Sector: Technology
• Sector Strength: 84
• Industry: Technology Distributors
• EPS (TTM): 0.74
• Shares Outstanding: 1,436,452,000
• 10 Day Avg. Volume: 8,257,920
• 30 Day Avg. Volume: 7,519,239
• PEG Ratio: -0.21
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -37.05
• 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: HK$7.60
• Price Target Upside: 6.00% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 76 Outperform
• Price Target: HK$7.00 ▼(-2.37%Downside)

The stock is supported by strong financial growth and attractive valuation metrics. The technical indicators suggest positive price momentum, although overbought signals could introduce short-term risk. The main area of concern is the lack of operating cash flow, which could affect liquidity if not addressed.

Positive Factors

Dividend Policy

VSTECS raised its dividend payout ratio to 40%, offering a dividend yield of 5% and demonstrating strong shareholder returns.

Market Position

VSTECS has become the largest IT distributor in several Southeast Asian countries, including Thailand, Malaysia, the Philippines, and Indonesia.

Revenue Growth

Total revenue increased by 21% year-over-year, driven by strong demand for AI solutions and significant growth in the South East Asian market.

Strategic Partnerships

VSTECS is deepening its partnership with leading cloud platforms like Alibaba, Huawei, and AWS to expand into lower-tier cities and boost sales of high-end products.

Negative Factors

Gross Profit Margin

Gross profit margin declined by 0.3 percentage points to 4.4% due to intense domestic competition and increased revenue from lower-margin AI server distribution.

Market Competition

Intense competition in the domestic market is exerting pressure on VSTECS's profit margins.

VSTECS Holdings Limited Business Overview & Revenue Model

Company Description

VSTECS Holdings Limited (0856) is a leading integrated information and communications technology (ICT) provider in Asia, focusing on the distribution of IT products, enterprise systems, and IT services. The company operates through various sectors, including technology distribution, enterprise system solutions, and managed services. VSTECS partners with numerous global technology brands to offer a wide range of products, including computer systems, software, networking equipment, and digital media products.

How the Company Makes Money

VSTECS Holdings Limited generates revenue primarily through its distribution of IT products and solutions, leveraging its extensive network and partnerships with major global technology manufacturers. The company earns money by purchasing products from these manufacturers and selling them to a broad range of customers, including resellers, system integrators, and corporate clients. Additionally, VSTECS provides value-added services such as logistics, technical support, and marketing, which enhance its revenue streams. The company also generates income from its enterprise systems segment by offering integrated solutions and managed services to businesses, helping them optimize their IT infrastructure and operations. Key factors contributing to its earnings include strategic alliances with leading technology brands, a robust distribution network, and a focus on expanding its service offerings in high-demand areas such as cloud computing and cybersecurity.

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

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

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

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.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
89.09B	73.89B	77.32B	78.34B	69.96B
	Gross Profit
3.93B	3.50B	3.37B	3.64B	3.13B
	EBIT
1.70B	1.44B	1.31B	1.60B	1.35B
	EBITDA
1.75B	1.62B	1.47B	1.73B	1.48B
	Net Income Common Stockholders
1.05B	922.03M	823.07M	1.31B	1.07B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.44B	4.13B	8.23B	4.38B	4.05B
	Total Assets
38.39B	35.02B	34.77B	32.18B	29.43B
	Total Debt
9.68B	8.44B	8.65B	6.53B	7.01B
	Net Debt
5.73B	5.12B	4.82B	3.28B	3.45B
	Total Liabilities
29.52B	26.80B	27.11B	24.27B	22.60B
	Stockholders Equity
8.64B	8.22B	7.66B	7.91B	6.83B
Cash Flow		Free Cash Flow
1.69B	601.41M	-171.90M	527.57M	2.42B
	Operating Cash Flow
1.82B	640.23M	-147.87M	580.07M	2.45B
	Investing Cash Flow
-300.93M	137.76M	-517.66M	-47.04M	-36.37M
	Financing Cash Flow
-837.13M	-1.37B	1.25B	-942.10M	-1.45B

VSTECS Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.17
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 7.17 is above the 20-day moving average (MA) of 6.46, above the 50-day MA of 6.03, and above the 200-day MA of 5.19, indicating a bullish trend. The MACD of 0.21 indicates Negative momentum. The RSI at 69.72 is Neutral, neither overbought nor oversold. The STOCH value of 77.80 is Neutral, 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

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1088	80 Outperform	HK$822.74B	11.16	12.78%	7.20%	-7.73%	-6.97%
1686	80 Outperform	€17.97B	18.65	19.23%	1.67%	12.91%	5.31%
0856	76 Outperform	HK$10.30B	9.48	12.48%	3.79%	20.56%	14.73%
2382	65 Neutral	HK$70.02B	23.82	11.45%	0.84%	18.80%	142.93%
Sector *	62 Neutral	$11.97B	10.29	-7.47%	2.99%	7.32%	-8.06%

VSTECS Holdings Limited Corporate Events

VSTECS Holdings Limited Successfully Passes All AGM Resolutions

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.

The most recent analyst rating on (HK:0856) stock is a Buy with a HK$7.20 price target. To see the full list of analyst forecasts on VSTECS Holdings Limited stock, see the HK:0856 Stock Forecast page.

VSTECS Holdings Limited Reports Strong Q1 2025 Financial Growth

VSTECS Holdings Limited reported a significant financial performance improvement in the first quarter of 2025, with revenue increasing by 16-17%, gross profit by 20-21%, and net profit attributable to shareholders by 28-29% compared to the same period in 2024. This unaudited financial update suggests a strong start to the year for VSTECS, indicating positive momentum in its operations and potentially enhancing its market position, though stakeholders are advised to exercise caution as the figures are preliminary and subject to change.

The most recent analyst rating on (HK:0856) stock is a Buy with a HK$7.20 price target. To see the full list of analyst forecasts on VSTECS Holdings Limited stock, see the HK:0856 Stock Forecast page.

VSTECS Holdings Limited Announces 2025 AGM and Key Resolutions

VSTECS Holdings Limited has announced its annual general meeting scheduled for May 22, 2025, where key agenda items include the approval of financial statements, declaration of a final dividend, re-election of directors, and re-appointment of auditors. Additionally, the meeting will consider resolutions to authorize the board to allot and issue shares, which could impact the company’s capital structure and shareholder value.

VSTECS Holdings Limited Announces 2025 Annual General Meeting

VSTECS Holdings Limited has announced its upcoming annual general meeting scheduled for May 22, 2025, in Hong Kong. The meeting will address several key matters, including the consideration of the audited financial statements for 2024, the declaration of a final dividend, the re-election of directors, and the re-appointment of KPMG as auditors. Additionally, the company seeks approval for the directors to allot and issue additional shares, subject to certain conditions. These resolutions aim to strengthen the company’s governance and financial strategies, potentially impacting its market position and shareholder value.

VSTECS Holdings Limited Unaffected by U.S. Tariff Changes

VSTECS Holdings Limited announced that the recent U.S. tariff on imports will not materially impact its business operations, as its sales are concentrated in mainland China, Hong Kong, Macau, and the ASEAN region, with products mainly sourced from Asia. The company’s board reassures stakeholders that the new U.S. tariff policy poses no direct adverse effects on their business, maintaining stability in their market operations.

VSTECS Holdings Declares Final Dividend for 2024

VSTECS Holdings Limited announced a final cash dividend of HKD 0.257 per share for the year ended December 31, 2024. The dividend will be paid on June 30, 2025, following shareholder approval on May 22, 2025. This announcement reflects the company’s financial performance and commitment to returning value to its shareholders.

VSTECS Holdings Limited Announces Final Cash Dividend for 2024

VSTECS Holdings Limited has announced a final ordinary cash dividend of HKD 0.257 per share for the financial year ending December 31, 2024. This dividend will be paid on June 30, 2025, following shareholder approval on May 22, 2025. The announcement reflects the company’s commitment to returning value to its shareholders and may impact investor sentiment positively.

VSTECS Holdings Limited Reports Strong Financial Growth for 2024

VSTECS Holdings Limited reported its consolidated financial results for the year ended December 31, 2024, showcasing a significant increase in revenue and profit compared to the previous year. The company’s revenue rose to HK$89.09 billion, up from HK$73.89 billion in 2023, while the profit attributable to equity shareholders increased to HK$1.05 billion from HK$922 million. This growth highlights the company’s strong market positioning and operational efficiency, benefiting stakeholders with a proposed final dividend of HK$369 million.