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Powerlong Real Estate Holdings Ltd. (HK:1238)
:1238
Hong Kong Market

Powerlong Real Estate Holdings Ltd. (1238) AI Stock Analysis

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HK

Powerlong Real Estate Holdings Ltd.

(1238)

Rating:36Underperform
Price Target:
Powerlong Real Estate Holdings Ltd. is currently facing substantial financial difficulties, with declining revenues, profitability, and cash flow issues. The high debt levels on its balance sheet and negative earnings outlook further exacerbate risks. Technically, the stock shows weak momentum, although it may see a short-term bounce due to oversold conditions. The negative P/E ratio indicates valuation challenges, and the absence of a dividend yield reduces its attractiveness to investors. Overall, the stock is under pressure with limited near-term catalysts for improvement.

Powerlong Real Estate Holdings Ltd. (1238) vs. iShares MSCI Hong Kong ETF (EWH)

Powerlong Real Estate Holdings Ltd. Business Overview & Revenue Model

Company DescriptionPowerlong Real Estate Holdings Limited, an investment holding company, invests in, develops, operates, and manages commercial real estate projects in the People's Republic of China. The company operates through four segments: Property Development, Property Investment, Commercial Operation and Residential Property Management, and Other Property Development Related Businesses. It develops commercial and residential properties. The company also operates hotels; and provides residential property management services, as well as construction services. As of December 31, 2021, it developed, owned, and operated 220 property development projects; operated investment properties primarily shopping malls with a total gross floor area (GFA) of approximately 7,286,508 square meters; had a land bank with a total GFA of 36.5 million square meters; and owned and managed eight international branded hotels and twelve self-owned branded chain hotels. The company was incorporated in 2007 and is based in Shanghai, the People's Republic of China.
How the Company Makes MoneyPowerlong Real Estate Holdings Ltd. generates revenue primarily through the sale and leasing of properties, particularly its large-scale commercial and residential complexes. The company benefits from rental income from its investment properties, including shopping malls and office spaces, which provide a steady stream of cash flow. Additionally, Powerlong engages in property management services, offering operational and maintenance support to enhance tenant satisfaction and retention. The company also engages in strategic partnerships and joint ventures to expand its project portfolio and share risks, contributing to its overall earnings growth. These activities, combined with its strategic geographic positioning in high-demand areas, enable Powerlong to capitalize on China's ongoing urbanization and economic development.

Powerlong Real Estate Holdings Ltd. Financial Statement Overview

Summary
Powerlong Real Estate Holdings Ltd. is facing significant financial challenges, with declining revenue, profitability, and cash flow. The balance sheet is burdened with high debt, and recent losses have impacted equity returns. While the company has a substantial asset base, the overall financial health is concerning, highlighting the need for strategic management and potential restructuring.
Income Statement
30
Negative
The company exhibits a declining trend in revenue and profitability, with a significant drop in gross profit margin from 27.8% in 2020 to 9.1% in 2024. The net profit margin has turned negative, indicating losses. Revenue growth is negative as well, with a substantial contraction seen in recent years. The negative EBIT and EBITDA margins underscore operational challenges.
Balance Sheet
45
Neutral
The balance sheet shows high leverage with a debt-to-equity ratio of 1.78 in 2024, indicating potential risk. However, the equity ratio stands at 17.2%, demonstrating some level of stability. Return on equity has turned negative due to losses, but the company maintains a substantial asset base.
Cash Flow
20
Very Negative
The cash flow statement reveals a challenging situation with zero operating and free cash flow in 2024. Previous periods showed some free cash flow generation, but the recent lack of cash flow raises concerns about liquidity and sustainability.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
25.76B22.90B31.38B39.90B35.50B
Gross Profit
2.35B2.45B9.88B12.52B12.82B
EBIT
-2.65B-1.85B7.03B9.04B10.03B
EBITDA
527.34M-538.26M7.27B9.27B10.25B
Net Income Common Stockholders
-5.77B-2.59B445.75M6.03B6.14B
Balance SheetCash, Cash Equivalents and Short-Term Investments
6.11B7.85B9.73B19.60B25.65B
Total Assets
192.02B214.81B233.75B245.06B195.13B
Total Debt
58.97B61.68B65.87B75.50B67.46B
Net Debt
52.87B53.95B56.28B56.09B42.12B
Total Liabilities
142.62B159.49B171.15B182.65B143.33B
Stockholders Equity
33.04B37.59B41.63B41.21B36.74B
Cash FlowFree Cash Flow
0.005.06B4.07B1.48B-12.40B
Operating Cash Flow
0.005.56B4.44B1.94B-12.01B
Investing Cash Flow
0.003.91B-1.65B-22.86B-5.24B
Financing Cash Flow
0.00-11.32B-12.55B15.10B22.36B

Powerlong Real Estate Holdings Ltd. Technical Analysis

Technical Analysis Sentiment
Negative
Last Price0.32
Price Trends
50DMA
0.34
Negative
100DMA
0.40
Negative
200DMA
0.47
Negative
Market Momentum
MACD
>-0.01
Negative
RSI
46.20
Neutral
STOCH
85.71
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1238, the sentiment is Negative. The current price of 0.32 is below the 20-day moving average (MA) of 0.32, below the 50-day MA of 0.34, and below the 200-day MA of 0.47, indicating a bearish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 46.20 is Neutral, neither overbought nor oversold. The STOCH value of 85.71 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:1238.

Powerlong Real Estate Holdings Ltd. 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
$2.83B10.920.41%8438.90%5.75%-21.03%
36
Underperform
HK$1.30B-16.13%10.08%-118.45%
$260.41M-90.47%
$23.72B6.179.66%6.59%
$1.38B-341.41%
$468.58M-71.13%
$134.95M-95.62%
* Real Estate Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:1238
Powerlong Real Estate Holdings Ltd.
0.32
-0.34
-51.52%
AGPYF
Agile Group Holdings
0.08
0.00
0.00%
CRBJF
China Resources Land
3.08
-0.64
-17.20%
CTRYF
Country Garden Holdings Co
0.01
-0.11
-91.67%
GZUHF
Guangzhou R&F Properties Co
0.12
0.02
20.00%
KWGPF
KWG Group Holdings
0.04
-0.01
-20.00%

Powerlong Real Estate Holdings Ltd. Corporate Events

Powerlong Real Estate Announces 2025 Annual General Meeting
Apr 28, 2025

Powerlong Real Estate Holdings Limited has announced its upcoming annual general meeting to be held on June 13, 2025, in Shanghai. Key agenda items include the adoption of financial statements for 2024, re-election of directors, and authorization for the board to manage director remuneration and share allotment. These resolutions aim to strengthen the company’s governance and operational capabilities, potentially impacting its market position and shareholder value.

Powerlong Real Estate Appoints New Financial Advisor for Liquidity Solution
Apr 23, 2025

Powerlong Real Estate Holdings Limited has appointed China International Capital Corporation Hong Kong Securities Limited as its new sole financial advisor to address its current liquidity issues. The company, along with its advisors, is working towards a holistic solution to reach an agreement with offshore creditors, emphasizing the need for patience and support from stakeholders.

Powerlong Real Estate Reports Q1 2025 Sales Figures
Apr 8, 2025

Powerlong Real Estate Holdings Limited reported unaudited operating statistics for March 2025, revealing a contracted sales value of approximately RMB696 million and a contracted sales area of 58,059 square meters. For the first quarter of 2025, the total contracted sales value reached RMB1,996 million with a total sales area of 168,323 square meters. These figures are preliminary and may vary from future audited reports, serving as a reference for investors who are advised to exercise caution.

Powerlong Real Estate Reports 12.5% Revenue Growth and CFO Change
Mar 31, 2025

Powerlong Real Estate Holdings Limited announced its annual results for the year ending December 31, 2024, reporting a 12.5% increase in revenue to approximately RMB25,757 million compared to the previous year. Additionally, the company experienced a 5.2% rise in rental income and income from commercial operational and residential property management services, totaling approximately RMB4,295 million. The announcement also included a change in the Chief Financial Officer position, indicating potential strategic shifts in the company’s financial management.

Powerlong Real Estate Reschedules Board Meeting for Annual Results
Mar 24, 2025

Powerlong Real Estate Holdings Ltd. has announced a change in the date of its board meeting originally scheduled for March 27, 2025, due to the need for additional time by the company’s auditor to finalize the annual results for 2024. The meeting will now take place on March 31, 2025, with all other details remaining unchanged. This rescheduling is crucial for ensuring accurate financial reporting, impacting stakeholders’ expectations and the company’s operational transparency.

Powerlong Real Estate Issues Profit Warning Amid Challenging Market Conditions
Mar 24, 2025

Powerlong Real Estate Holdings Limited has issued a profit warning, indicating an expected increase in losses for the year ending December 31, 2024, compared to the previous year. The anticipated losses, ranging between RMB5,300 million and RMB5,600 million, are attributed to a challenging operating environment in the real estate sector, including impairment provisions for property projects, decreased fair value of investment properties, foreign exchange losses, and reduced share of results from joint ventures and associates.

Powerlong Real Estate to Review Annual Results in Upcoming Board Meeting
Mar 17, 2025

Powerlong Real Estate Holdings Limited has announced a board meeting scheduled for March 27, 2025, to consider and approve the annual results for the year ending December 31, 2024. This meeting will also address any other business matters, potentially impacting the company’s operational strategy and stakeholder interests.

Powerlong Real Estate Reports February 2025 Sales Figures
Mar 9, 2025

Powerlong Real Estate Holdings Ltd. reported unaudited operating statistics for February 2025, revealing a contracted sales value of approximately RMB608 million and a contracted sales area of 51,933 square meters. For the first two months of 2025, the total contracted sales value reached approximately RMB1,300 million with a sales area of 110,264 square meters. These figures are preliminary and may differ from future audited reports, advising investors to exercise caution.

Powerlong Faces Liquidation Application Amidst Debt Challenges
Mar 9, 2025

Powerlong Real Estate Holdings Ltd. announced that a liquidation application has been filed against its wholly-owned subsidiary, Powerlong BVI, due to non-payment of senior notes. The company is actively negotiating with the applicants to resolve the issue and believes the application does not reflect the interests of other stakeholders. Powerlong is committed to finding a comprehensive solution to its liquidity issues and is working with financial and legal advisors to protect its operations and stakeholder interests.

Powerlong Real Estate’s Restructuring Scheme Lapses; Company Seeks New Solutions
Feb 28, 2025

Powerlong Real Estate Holdings Limited announced that its restructuring scheme has lapsed as certain conditions were not met by the Longstop Date of February 28, 2025. Despite this setback, the company remains committed to finding a holistic solution to its liquidity issues and has engaged Alvarez & Marsal Corporate Finance Limited as a financial advisor to explore feasible options with creditors. The company is seeking cooperation and patience from its offshore creditors to develop an optimal debt solution.

Powerlong Real Estate Faces Restructuring Setback as Court Denies Extension
Feb 21, 2025

Powerlong Real Estate Holdings Limited announced a setback in its restructuring process as the court denied the company’s request to extend the Longstop Date from 28 February 2025 to 31 May 2025. Despite efforts to fulfill restructuring conditions, some are likely to remain unmet, causing the scheme to lapse after the original Longstop Date. The company is committed to maintaining communication with creditors and emphasizes the importance of patience and understanding from stakeholders as it seeks a holistic solution for its debt obligations.

Powerlong Real Estate Announces January 2025 Sales Performance
Feb 10, 2025

Powerlong Real Estate Holdings Ltd. announced its unaudited operating statistics for January 2025, reporting a total contracted sales value of approximately RMB691 million and a sales area of 58,331 square meters. These figures are based on preliminary internal data and may vary from future audited financial statements, prompting the company to advise investors to exercise caution and seek professional advice when considering their securities.

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.