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Towngas China Co Ltd (HK:1083)
:1083
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Towngas China Co (1083) AI Stock Analysis

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HK:1083

Towngas China Co

(OTC:1083)

Rating:76Outperform
Price Target:
HK$4.50
▲(4.65% Upside)
Towngas China Co benefits from strong technical momentum and attractive valuation metrics. However, challenges in cash flow management and maintaining net profitability slightly offset these positives. With no recent earnings call or corporate events impacting the analysis, the overall score reflects these strengths and areas for improvement.
Positive Factors
Business Transformation
Towngas Smart Energy is transforming from a pure gas distributor to a smart energy service provider, particularly for industrial parks, to ride on China’s decarbonization plan.
Power Generation
Power generation jumped from 0.28b kWh in 1HFY23 to 0.68b kWh in 1HFY24.
Strategic Partnerships
Towngas Smart Energy has formed alliances with various strategic partners, including SPIC, Tencent, Longi, CATL, etc., to strengthen its competitive advantages.
Negative Factors
Earnings Growth
Lower earnings growth is anticipated due to weak economic recovery and slow development of smart energy.
Electricity Tariff Risks
A downgrade to HOLD reflects higher downside risk in electricity tariff due to increasing participation of distributed solar projects in market-based transactions.

Towngas China Co (1083) vs. iShares MSCI Hong Kong ETF (EWH)

Towngas China Co Business Overview & Revenue Model

Company DescriptionTowngas China Co (1083) is a leading energy services provider in China, focusing primarily on the distribution and sale of piped natural gas and the provision of related energy services. The company operates within the utilities sector, offering a range of services including gas pipeline construction, the sale of gas appliances, and the supply of natural gas to residential, commercial, and industrial customers. Towngas China Co is a subsidiary of The Hong Kong and China Gas Company Limited, one of the largest energy suppliers in Asia.
How the Company Makes MoneyTowngas China Co makes money primarily through the distribution and sale of natural gas. Its key revenue streams include the sale of piped gas to residential, commercial, and industrial customers across China. The company also generates income from the installation and construction of gas pipelines, as well as the sale of gas-related appliances and equipment. Additionally, Towngas China Co benefits from long-term supply contracts and partnerships with local governments and other stakeholders, which help to secure steady and reliable revenue. The company’s strategic location and established infrastructure further contribute to its financial success by enabling efficient distribution and service delivery.

Towngas China Co Financial Statement Overview

Summary
Towngas China Co shows strong revenue growth and operational efficiency, evidenced by improved gross and EBIT margins. However, the slight decrease in net profit margin and negative free cash flow highlight challenges in profitability and cash generation. The balance sheet is stable, but improvements in cash flow management are needed.
Income Statement
75
Positive
Towngas China Co has demonstrated strong revenue growth, with total revenue increasing by 7.4% from 2023 to 2024. The gross profit margin improved to 25.65% in 2024, indicating effective cost management. However, the net profit margin slightly decreased to 7.54%, suggesting some challenges in maintaining profitability at the net level. The EBIT margin increased to 18.98%, highlighting operational efficiency improvements.
Balance Sheet
68
Positive
The company's debt-to-equity ratio stands at 0.75, reflecting a moderate level of leverage. The equity ratio is 44.21%, indicating a solid equity base relative to total assets. Return on equity is at 6.85%, showing a modest return for shareholders. Overall, the balance sheet is stable but shows room for improvement in leveraging equity more effectively.
Cash Flow
40
Negative
The cash flow analysis reveals challenges, with free cash flow remaining negative in recent years. The lack of operating cash flow data for 2024 prevents a detailed analysis, but the consistent negative free cash flow indicates issues in cash generation and capital management. This poses a risk to financial flexibility.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue21.31B19.84B20.07B17.13B12.83B
Gross Profit5.47B4.72B2.32B2.72B2.32B
EBITDA2.91B2.73B2.53B3.60B2.69B
Net Income1.61B1.57B964.86M1.25B1.45B
Balance Sheet
Total Assets53.04B53.46B52.94B54.24B42.89B
Cash, Cash Equivalents and Short-Term Investments2.73B4.11B4.08B4.08B2.34B
Total Debt17.47B18.56B19.83B19.54B11.58B
Total Liabilities27.28B28.23B29.08B29.06B20.24B
Stockholders Equity23.45B22.85B21.50B22.90B20.72B
Cash Flow
Free Cash Flow-1.49B-3.42B-1.57B-177.88M343.03M
Operating Cash Flow2.35B1.30B1.80B2.61B2.71B
Investing Cash Flow-2.77B635.96M-3.57B-8.14B-2.95B
Financing Cash Flow-862.84M-1.75B1.98B7.31B425.26M

Towngas China Co Technical Analysis

Technical Analysis Sentiment
Positive
Last Price4.30
Price Trends
50DMA
4.00
Positive
100DMA
3.65
Positive
200DMA
3.30
Positive
Market Momentum
MACD
0.09
Negative
RSI
68.59
Neutral
STOCH
90.07
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1083, the sentiment is Positive. The current price of 4.3 is above the 20-day moving average (MA) of 4.11, above the 50-day MA of 4.00, and above the 200-day MA of 3.30, indicating a bullish trend. The MACD of 0.09 indicates Negative momentum. The RSI at 68.59 is Neutral, neither overbought nor oversold. The STOCH value of 90.07 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1083.

Towngas China Co Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
$73.53B11.2313.65%4.67%-5.28%-13.15%
76
Outperform
$15.69B9.186.98%4.40%7.42%-2.02%
71
Outperform
$45.27B13.766.04%5.95%-2.64%1.97%
66
Neutral
$17.90B18.758.12%3.41%7.32%12.01%
60
Neutral
€12.01B28.272.75%1.57%-3.03%-0.47%
59
Neutral
$45.32B11.099.94%4.75%1.39%-21.74%
50
Neutral
HK$10.36B71.811.91%0.53%-1.26%-40.09%
* Utilities Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:1083
Towngas China Co
4.30
1.46
51.36%
HK:1635
Shanghai Dazhong Public Utilities (Group) Co., Ltd. Class H
2.51
1.19
90.87%
HK:1193
China Resources Gas Group
19.99
-6.60
-24.81%
HK:3633
Zhongyu Gas Holdings Limited
3.78
-0.88
-18.83%
HK:2688
ENN Energy Holdings
64.30
11.67
22.16%
HK:0384
China Gas Holdings
8.40
1.64
24.30%

Towngas China Co Corporate Events

Towngas Smart Energy Schedules Board Meeting for Interim Results
Aug 5, 2025

Towngas Smart Energy Company Limited has announced a board meeting scheduled for August 15, 2025, to approve and publish its unaudited consolidated interim results for the first half of 2025. The meeting will also consider the payment of an interim dividend, which could impact the company’s financial strategy and shareholder returns.

The most recent analyst rating on (HK:1083) stock is a Buy with a HK$3.45 price target. To see the full list of analyst forecasts on Towngas China Co stock, see the HK:1083 Stock Forecast page.

Towngas Smart Energy Adjusts Convertible Bonds Conversion Price
Jul 14, 2025

Towngas Smart Energy Company Limited has announced an adjustment to the conversion price of its Convertible Bonds, reducing it from HK$6.06 to HK$5.94 per share. This adjustment follows the payment of dividends and the issuance of scrip shares, allowing for an increase in the maximum number of shares to be issued upon full conversion of the bonds. The adjustment is expected to enhance the company’s market positioning by potentially increasing shareholder value and liquidity.

The most recent analyst rating on (HK:1083) stock is a Buy with a HK$3.45 price target. To see the full list of analyst forecasts on Towngas China Co stock, see the HK:1083 Stock Forecast page.

Towngas Smart Energy Announces Final Dividend with Scrip Option
Jun 12, 2025

Towngas Smart Energy Company Limited has announced a final ordinary dividend of HKD 0.16 per share for the financial year ending December 31, 2024. Shareholders have the option to receive their dividends in cash or convert them into scrip shares at a price of HKD 3.446 per share. The payment date is set for July 14, 2025, with the first date for dealing in scrip shares on July 15, 2025. This announcement reflects the company’s commitment to providing shareholder value and may impact its market positioning by offering flexible dividend options.

The most recent analyst rating on (HK:1083) stock is a Buy with a HK$3.45 price target. To see the full list of analyst forecasts on Towngas China Co stock, see the HK:1083 Stock Forecast page.

Towngas Smart Energy Announces Special Dividend with Scrip Option
Jun 12, 2025

Towngas Smart Energy Company Limited has announced a special dividend of HKD 0.03 per share for the financial year ending December 31, 2024. Shareholders have the option to receive the dividend in cash or convert it into scrip shares at a price of HKD 3.446 per share. The payment date for the dividend is set for July 14, 2025, with the first date of dealing in scrip shares on July 15, 2025. This announcement reflects the company’s commitment to providing value to its shareholders, potentially impacting its market positioning and stakeholder relations positively.

The most recent analyst rating on (HK:1083) stock is a Buy with a HK$3.45 price target. To see the full list of analyst forecasts on Towngas China Co stock, see the HK:1083 Stock Forecast page.

Towngas China Co Revises Annual Caps to Boost Gas and Smart Energy Transactions
Jun 6, 2025

Towngas China Co has announced a revision of its annual cap amounts for continuing connected transactions under its Master Gas and Smart Energy Related Agreement with HKCG. The revised annual caps for the years ending December 2025 and 2026 are significantly increased, reflecting the company’s strategy to expand its gas resources business and capitalize on the rising demand for fuel gas. This adjustment is expected to enhance synergies and optimize the supply-demand structure, benefiting both Towngas China Co and its stakeholders.

The most recent analyst rating on (HK:1083) stock is a Hold with a HK$3.00 price target. To see the full list of analyst forecasts on Towngas China Co stock, see the HK:1083 Stock Forecast page.

Towngas China Co Enhances Liquidity Through Asset Disposal
Jun 3, 2025

Towngas China Co announced the disposal of its equity interests in subsidiaries engaged in rooftop photovoltaic power generation projects to an asset-backed securities program, raising approximately RMB470 million. This move is part of the company’s strategy to improve liquidity through securitization of its solar assets while retaining a stake in the profits. The proceeds will be used for further investments in renewable energy projects, debt repayment, and general working capital.

The most recent analyst rating on (HK:1083) stock is a Buy with a HK$3.45 price target. To see the full list of analyst forecasts on Towngas China Co stock, see the HK:1083 Stock Forecast page.

Towngas Smart Energy Secures Shareholder Approval for Key Resolutions at AGM
May 29, 2025

Towngas Smart Energy Company Limited held its Annual General Meeting on May 29, 2025, where all proposed resolutions were approved by shareholders. The resolutions included the adoption of financial statements, re-election of directors, authorization for directors’ remuneration, re-appointment of auditors, and granting mandates for share buybacks and issuance. The successful approval of these resolutions reflects strong shareholder support and positions the company for continued operational stability and strategic growth.

The most recent analyst rating on (HK:1083) stock is a Buy with a HK$3.45 price target. To see the full list of analyst forecasts on Towngas China Co stock, see the HK:1083 Stock Forecast page.

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 10, 2025