Impro Precision Industries Limited (1286) AI Stock Analysis

• Market Cap: HK$12.10B
• Dividend Yield: 3.23%
• Average Volume (3M): 1.47M
• Price to Earnings (P/E): 17.6
• Beta (1Y): 0.59
• Revenue Growth: 2.87%
• EPS Growth: 17.03%
• Country: HK
• Employees: 7,778
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 0.18
• Shares Outstanding: 1,887,285,600
• 10 Day Avg. Volume: 2,038,787
• 30 Day Avg. Volume: 1,469,679
• PEG Ratio: 0.59
• Price to Book (P/B): 0.78
• Price to Sales (P/S): 0.79
• P/FCF Ratio: 6.90
• 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$7.49
• Price Target Upside: 48.02% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 75 Outperform
• Price Target: HK$8.00 ▲(58.10% Upside)

The score is driven primarily by strong financial performance (growth, improving profitability, and better free cash flow) and a clear bullish price trend. Offsetting this, technical indicators show the stock is overbought (high RSI/Stoch), and valuation is only moderate with a modest dividend yield.

Positive Factors

Consistent Revenue Growth

Sustained top-line expansion over multiple years signals durable demand and successful customer penetration in core markets. This growth supports higher capacity utilization, enables scale-driven cost efficiencies, and underpins longer-term investment in R&D and tooling tied to recurring contracts.

Healthy Profit Margins

Maintained gross and net margins reflect pricing power, operational discipline and effective quality control in precision manufacturing. Margins of this level improve resilience to input-cost volatility, fund reinvestment and support sustainable free cash generation over the medium term.

Solid Balance Sheet Position

A strong equity base and moderate leverage provide financial flexibility to fund capex, absorb cyclical shocks, and support long-term contracts. Healthy equity ratio reduces refinancing risk and preserves capacity to pursue strategic partnerships or targeted M&A when opportunities arise.

Negative Factors

Rising Debt Levels

Increasing leverage, if unchecked, can raise interest costs and constrain strategic flexibility. Higher debt amplifies exposure to rate cycles and could force tighter cash allocation between servicing liabilities and investing in critical manufacturing capacity or technology upgrades.

Ongoing Capital Expenditure Needs

Precision engineering requires continuous investment in tooling and equipment. Persistent capex needs can pressure free cash flow and may necessitate external funding, which would increase leverage or divert resources from R&D and margin-enhancing initiatives over the medium term.

End-Market Concentration Risk

Heavy exposure to cyclical sectors like aerospace and automotive makes revenue and order visibility sensitive to macro and industry cycles. Prolonged downturns or shifts in OEM demand could reduce utilization and margin stability, challenging long-term revenue predictability.

Impro Precision Industries Limited Business Overview & Revenue Model

Company Description

Impro Precision Industries Limited develops, produces, and sells casting products and precision machining parts in the United States, Europe, the People's Republic of China, and internationally. It operates in four segments: Investment Casting, Precision Machining, Sand Casting, and Surface Treatment. The company offers passenger cars, commercial vehicles, high horsepower engines, hydraulic equipment, construction equipment, agricultural equipment, recreational boats and vehicles, aerospace, and medical components. It also offers surface treatment services, such as plating, anodizing, painting, and coating. In addition, the company manages logistic centers and warehouses, as well as provides customer maintenance services. It serves automotive, high horsepower engine, construction equipment, agricultural equipment, hydraulic equipment, aerospace, medical, energy, recreational boat and vehicles, fire and security systems, telecommunication, forestry, and the food processing industries. The company was founded in 1998 and is headquartered in Wan Chai, Hong Kong.

How the Company Makes Money

Impro Precision Industries generates revenue through multiple streams, primarily from the sale of precision components and engineering solutions to various industries. Key revenue streams include direct sales of manufactured parts, long-term contracts with major clients in the aerospace and automotive sectors, and provision of value-added services such as design support and engineering consultancy. The company also benefits from strategic partnerships with leading manufacturers and technology providers, which enhance its product offerings and market reach. The ongoing demand for high-quality, precision-engineered products in its target sectors contributes significantly to its earnings.

Impro Precision Industries Limited Financial Statement Overview

Summary

Strong fundamentals supported by consistent revenue growth (HKD 2.92B in 2020 to HKD 4.69B in 2024), improved profitability (net margin ~13.74% in 2024) and solid operating efficiency (healthy gross/EBIT/EBITDA margins). Cash flow improved with positive free cash flow in 2024 and good cash conversion. Balance sheet is generally stable with moderate leverage (debt-to-equity ~0.47), but rising debt levels remain a risk to monitor.

Income Statement

Impro Precision Industries Limited shows a strong income statement performance with a consistent revenue growth trend, rising from HKD 2.92 billion in 2020 to HKD 4.69 billion in 2024. The company has maintained a solid Gross Profit Margin, with the most recent year at approximately 27.08%. Net Profit Margin improved to 13.74% in 2024, indicating enhanced profitability. EBIT and EBITDA margins are commendable, reflecting efficient operational management. Overall, the income statement reflects robust growth and profitability.

Balance Sheet

The balance sheet shows a stable financial position with an improving equity base, reaching HKD 4.72 billion in 2024. The Debt-to-Equity Ratio has been maintained at a moderate level, indicating controlled leverage; as of 2024, it stands at approximately 0.47. The Equity Ratio is healthy at 57.78%, reflecting a strong equity position relative to total assets. However, the increasing debt levels over the years could pose a potential risk if not managed carefully.

Cash Flow

Impro Precision Industries Limited demonstrates strong cash flow generation capabilities. Free Cash Flow grew positively in 2024, reversing the negative trend in previous years. The Operating Cash Flow to Net Income Ratio is robust, indicating effective cash conversion from earnings. While Free Cash Flow to Net Income Ratio signifies good cash management, consistent capital expenditures need careful monitoring to avoid cash strain.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.73B	4.69B	4.60B	4.35B	3.78B	2.92B
Gross Profit	1.32B	1.27B	1.18B	1.40B	1.13B	875.46M
EBITDA	1.22B	1.18B	1.16B	1.17B	913.93M	371.69M
Net Income	686.17M	644.30M	585.09M	581.95M	382.78M	-148.19M
Balance Sheet
Total Assets	8.81B	8.17B	8.30B	7.76B	7.04B	5.67B
Cash, Cash Equivalents and Short-Term Investments	655.23M	601.75M	630.85M	483.29M	578.96M	601.99M
Total Debt	2.35B	2.20B	2.26B	2.21B	1.54B	853.75M
Total Liabilities	3.55B	3.43B	3.40B	3.36B	2.66B	1.64B
Stockholders Equity	5.24B	4.72B	4.88B	4.38B	4.36B	4.01B
Cash Flow
Free Cash Flow	506.58M	534.22M	570.04M	71.33M	-635.76M	317.07M
Operating Cash Flow	1.20B	1.15B	1.28B	782.29M	401.09M	864.57M
Investing Cash Flow	-795.81M	-690.00M	-772.89M	-1.22B	-1.03B	-574.52M
Financing Cash Flow	-119.48M	-467.17M	-359.69M	379.45M	579.93M	-339.12M

Impro Precision Industries Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5.06
• 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:1286, the sentiment is Positive. The current price of 5.06 is below the 20-day moving average (MA) of 5.87, below the 50-day MA of 5.38, and above the 200-day MA of 3.93, indicating a bullish trend. The MACD of 0.36 indicates Negative momentum. The RSI at 63.47 is Neutral, neither overbought nor oversold. The STOCH value of 59.34 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1286.

Impro Precision Industries Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2155	78 Outperform	HK$13.38B	16.61	13.83%	1.57%	-13.95%	-13.61%
2285	77 Outperform	HK$12.34B	10.82	14.64%	8.66%	28.34%	―
1286	75 Outperform	HK$12.10B	17.63	14.15%	3.23%	2.87%	17.03%
2722	73 Outperform	HK$9.03B	14.52	7.29%	2.50%	11.18%	46.57%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
0558	60 Neutral	HK$4.56B	13.28	17.97%	2.25%	14.32%	-19.44%
0187	42 Neutral	HK$6.52B	-508.75	-0.43%	―	7.11%	77.53%

Impro Precision Industries Limited Corporate Events

Impro Precision Wins Strong Shareholder Backing for New Share Option Scheme

Impro Precision Industries Limited has secured shareholder approval at an extraordinary general meeting held on 30 December 2025 to adopt a new share option scheme while terminating its existing scheme, following a poll vote in which approximately 97.9% of the votes cast were in favour. All 1,887,285,665 issued shares were eligible to vote with no restrictions or mandatory abstentions, and the resolution’s strong support, alongside full board attendance, underlines broad shareholder alignment on updating the company’s equity incentive framework, which is likely aimed at enhancing long-term alignment between management, employees and investors.

The most recent analyst rating on (HK:1286) stock is a Buy with a HK$7.49 price target. To see the full list of analyst forecasts on Impro Precision Industries Limited stock, see the HK:1286 Stock Forecast page.

Impro Precision Industries Announces EGM for New Share Option Scheme

Impro Precision Industries Limited has announced an Extraordinary General Meeting to be held on December 30, 2025, to consider the adoption of a New Share Option Scheme. This scheme aims to replace the existing one from 2018, subject to approval from the Stock Exchange. The new scheme is designed to enhance the company’s flexibility in granting share options, potentially impacting its operational strategy and shareholder value.

The most recent analyst rating on (HK:1286) stock is a Buy with a HK$7.49 price target. To see the full list of analyst forecasts on Impro Precision Industries Limited stock, see the HK:1286 Stock Forecast page.

Impro Precision Reports Strong Q3 2025 Sales Growth

Impro Precision Industries Limited reported a robust sales performance for the third quarter of 2025, with a notable 16.8% increase in revenue compared to the previous year. The company experienced significant growth in the diversified industrials and aerospace, medical, and energy segments, driven by strong demand in AI-related and medical end-markets. Despite challenges in the global economy, the company forecasts continued sales growth for the full year, although the automotive segment saw a decline.

The most recent analyst rating on (HK:1286) stock is a Buy with a HK$5.50 price target. To see the full list of analyst forecasts on Impro Precision Industries Limited stock, see the HK:1286 Stock Forecast page.

Impro Precision Industries to Adopt New Share Option Scheme

Impro Precision Industries Limited has announced its intention to terminate its Existing Share Option Scheme, which was adopted in June 2018, and replace it with a New Share Option Scheme. This move is in response to amendments in the Stock Exchange’s Listing Rules that came into effect in January 2023. The new scheme aims to align with market practices by offering incentives to eligible participants, enhancing enterprise value, and achieving long-term objectives for the company’s growth and development. The adoption of the new scheme is subject to shareholder approval and regulatory conditions.

The most recent analyst rating on (HK:1286) stock is a Buy with a HK$5.50 price target. To see the full list of analyst forecasts on Impro Precision Industries Limited stock, see the HK:1286 Stock Forecast page.