Sprocomm Intelligence Limited (1401) AI Stock Analysis

• Market Cap: HK$1.31B
• Dividend Yield: N/A
• Average Volume (3M): 2.29M
• Price to Earnings (P/E): 74.0
• Beta (1Y): 0.95
• Revenue Growth: 2.36%
• EPS Growth: -50.14%
• Country: HK
• Employees: 1,414
• Sector: Technology
• Sector Strength: 84
• Industry: Consumer Electronics
• EPS (TTM): <0.01
• Shares Outstanding: 1,000,000,000
• 10 Day Avg. Volume: 2,381,400
• 30 Day Avg. Volume: 2,286,200
• PEG Ratio: -0.62
• Price to Book (P/B): 1.71
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 1.00
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 53 Neutral
• Price Target: ―

Sprocomm Intelligence Limited's overall score reflects considerable financial challenges, with declining margins and potential liquidity issues impacting its financial health. Technical analysis suggests a mixed outlook with short-term recovery signals but long-term bearish trends. The stock's high P/E ratio raises concerns about overvaluation, especially in the absence of a dividend yield. These factors combined lead to a cautious score, indicating potential risks for investors.

Sprocomm Intelligence Limited Business Overview & Revenue Model

Company Description

Sprocomm Intelligence Limited (1401) is a company engaged in the design, development, and manufacturing of mobile communication products. The company primarily focuses on the production of smartphones and feature phones, catering to a broad spectrum of markets with a range of technologically advanced and user-friendly devices. Sprocomm Intelligence is known for its commitment to innovation and quality, aiming to deliver high-performance mobile solutions to its customers.

How the Company Makes Money

Sprocomm Intelligence Limited generates revenue primarily through the sale of its mobile communication products, including smartphones and feature phones. The company's key revenue streams include direct sales of devices to consumers and partnerships with telecommunications operators who distribute these products through their networks. Additionally, Sprocomm may engage in OEM (Original Equipment Manufacturer) and ODM (Original Design Manufacturer) services, producing devices under other brands, which contributes to its income. The company's earnings are significantly influenced by its ability to innovate, maintain competitive pricing, and establish strong distribution channels in various markets.

Sprocomm Intelligence Limited Financial Statement Overview

Summary

Sprocomm Intelligence Limited faces challenges across its financial statements. The income statement demonstrates declining revenue and profit margins, reflecting operational headwinds. The balance sheet reveals increased leverage and lower equity contribution, which may affect financial stability. Cash flow issues are particularly concerning, with missing data suggesting potential liquidity risks. Overall, the company needs to address operational inefficiencies and improve cash flow management to enhance its financial health.

Income Statement

Sprocomm Intelligence Limited exhibited a mixed performance. The gross profit margin for 2024 is approximately 8.83%, which is a decline from 10.61% in 2023, indicating decreased efficiency in cost management. The net profit margin improved to 0.56% from 1.15% in 2023, highlighting better bottom-line management despite lower revenues. Revenue growth was negative at -3.16% from 2023 to 2024, showing a decline in sales, but the EBIT and EBITDA margins both turned negative, reflecting challenges in operational profitability.

Balance Sheet

The balance sheet reflects moderate leverage with a debt-to-equity ratio of 0.51, which is manageable but has increased from 0.46 in 2023. The return on equity (ROE) was 4.44%, a decrease from 9.19% in 2023, indicating lower efficiency in generating profits from equity. The equity ratio stands at 10.84%, suggesting a low proportion of assets financed by equity, pointing to potential stability risks if liabilities grow.

Cash Flow

Cash flow statements show that the company did not report any operating or free cash flow for 2024, a significant drop from 2023's strong free cash flow of $1.565 billion. This absence of cash flow data indicates potential liquidity issues or unreported cash movements. The operating cash flow to net income and free cash flow to net income ratios cannot be evaluated due to missing data, raising concerns about cash generation efficiency.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
2.82B	2.92B	2.82B	1.45B	2.00B	2.18B
	Gross Profit
299.59M	257.77M	299.59M	203.63M	172.24M	193.42M
	EBIT
36.98M	-17.48M	64.26M	-24.08M	-46.45M	-19.52M
	EBITDA
51.27M	-3.19M	110.69M	591.00K	-25.52M	-674.00K
	Net Income Common Stockholders
32.37M	16.34M	32.37M	6.51M	-17.75M	30.88M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
67.95M	79.36M	67.95M	36.63M	82.90M	28.10M
	Total Assets
3.82B	3.40B	3.82B	1.46B	1.10B	1.21B
	Total Debt
162.75M	187.06M	162.75M	57.68M	78.46M	60.17M
	Net Debt
94.80M	107.69M	94.80M	21.04M	-4.45M	33.84M
	Total Liabilities
3.47B	3.03B	3.47B	1.14B	786.86M	872.34M
	Stockholders Equity
352.08M	368.14M	352.08M	320.22M	315.92M	333.34M
Cash Flow		Free Cash Flow
1.57B	0.00	1.57B	547.36M	18.23M	-70.67M
	Operating Cash Flow
1.57B	0.00	1.57B	555.86M	21.35M	-40.15M
	Investing Cash Flow
-1.59B	0.00	-1.59B	-567.85M	53.39M	79.32M
	Financing Cash Flow
47.69M	0.00	47.69M	-35.94M	-17.35M	-138.03M

Sprocomm Intelligence Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.31
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1401, the sentiment is Negative. The current price of 1.31 is below the 20-day moving average (MA) of 1.37, below the 50-day MA of 1.46, and below the 200-day MA of 3.18, indicating a bearish trend. The MACD of -0.05 indicates Negative momentum. The RSI at 35.84 is Neutral, neither overbought nor oversold. The STOCH value of 3.70 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:1401.

Sprocomm Intelligence Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2318	72 Outperform	$991.98B	6.84		7.49%	11.71%	37.04%
2382	65 Neutral	$69.31B	23.58	11.45%	0.85%	18.80%	142.93%
Sector *	62 Neutral	$11.97B	10.29	-7.47%	2.99%	7.32%	-8.06%
2018	58 Neutral	$46.30B	23.50	8.06%	0.63%	31.55%	141.88%
1401	53 Neutral	HK$1.31B	74.01	4.55%	―	2.36%	-50.14%

Sprocomm Intelligence Limited Corporate Events

Sprocomm Intelligence Schedules 2025 AGM to Discuss Key Resolutions

Sprocomm Intelligence Limited has announced its 2025 Annual General Meeting (AGM) scheduled for May 30, 2025, in Shenzhen, China. The meeting will address several key resolutions, including the approval of the 2024 financial statements, re-election of directors, and re-appointment of auditors. Additionally, the company seeks authorization to allot and issue new shares, which could potentially impact its capital structure and shareholder value.

Sprocomm Intelligence Proposes Name Change to Future Machine Limited

Sprocomm Intelligence Limited has proposed to change its English name to Future Machine Limited and adopt a new Chinese name. This change is intended to better reflect the company’s future business plans and development, providing a new corporate image and identity. The name change is subject to shareholder approval and regulatory consent in the Cayman Islands. The change will not affect shareholder rights, daily operations, or financial position, and existing share certificates will remain valid. The company plans to update its stock short name on the Hong Kong Stock Exchange following the change.

Sprocomm Intelligence Announces Board Changes

Sprocomm Intelligence Limited has announced a change in its board composition with the resignation of Ms. Tseng Chin I as an independent non-executive director, effective April 1, 2025, to focus on personal commitments. The company has expressed gratitude for her contributions. Concurrently, Ms. Wang Huihui has been appointed as the new independent non-executive director. Ms. Wang, a practicing lawyer with expertise in financial regulations and compliance, will also join the remuneration and nomination committees. Her appointment is expected to enhance the company’s governance with her legal expertise.

Sprocomm Intelligence Limited Announces Board and Committee Structure

Sprocomm Intelligence Limited has announced the composition of its board of directors and the roles within its established committees. This announcement outlines the leadership structure, which includes both executive and independent non-executive directors, and highlights the company’s governance framework, potentially impacting its strategic direction and stakeholder engagement.

Sprocomm Intelligence Reports 2024 Financial Results with Revenue Growth but Declining Profitability

Sprocomm Intelligence Limited announced its annual financial results for the year ending December 31, 2024, reporting a revenue increase to RMB 2,917,434,000 from the previous year. However, the company experienced a decline in net profit to RMB 15,609,000 and a decrease in gross profit margin to 8.8%. These results indicate challenges in maintaining profitability despite revenue growth, which may impact stakeholder confidence and necessitate strategic adjustments to improve financial performance.

Sprocomm Intelligence Schedules Board Meeting for Financial Results and Dividend Consideration

Sprocomm Intelligence Limited, a company incorporated in the Cayman Islands, has announced a board meeting scheduled for March 27, 2025. The meeting will focus on approving the company’s final results for the year ending December 31, 2024, and considering the payment of a final dividend. This announcement indicates the company’s ongoing financial activities and potential shareholder returns, reflecting its operational focus and strategic financial planning.

Sprocomm Intelligence Announces Key Leadership Change

Sprocomm Intelligence Limited has announced a change in its company secretary and authorized representative roles. Ms. Jian Xuegen has resigned, and Mr. Li Yiu Hong has been appointed to these positions effective February 28, 2025. Mr. Li brings a decade of experience in auditing, accounting, and finance, and is a certified public accountant. This transition is expected to maintain the company’s compliance with listing rules and ensure continued effective corporate governance.

Sprocomm Intelligence Issues Profit Warning Amid Strategic Margin Adjustments

Sprocomm Intelligence Limited has announced a profit warning, indicating a significant drop in expected net profit for the year ended December 31, 2024, compared to the previous year. This decline is primarily due to a strategic decision to reduce the gross profit margin to secure sales orders from key customers and an increase in administrative expenses. The announcement suggests a challenging period for the company, with potential implications for its market position and investor confidence as it navigates these financial adjustments.