Sinomax Group Ltd. (1418) AI Stock Analysis

• Market Cap: HK$551.25M
• Dividend Yield: 7.3%
• Average Volume (3M): 66.13K
• Price to Earnings (P/E): 3.9
• Beta (1Y): 0.71
• Revenue Growth: 13.36%
• EPS Growth: 120.39%
• Country: HK
• Employees: 3,333
• Sector: Consumer Cyclical
• Sector Strength: 64
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): 0.04
• Shares Outstanding: 1,750,002,100
• 10 Day Avg. Volume: 117,200
• 30 Day Avg. Volume: 66,133
• PEG Ratio: 0.13
• Price to Book (P/B): 0.54
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.84
• 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$0.50
• Price Target Upside: 61.29% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 72 Outperform
• Price Target: HK$0.50 ▲(61.29%Upside)

The stock's strong valuation with a low P/E ratio and high dividend yield is the most significant positive factor. Technical analysis supports a positive outlook with the stock trading above key moving averages. Financial performance is improving, but cash flow concerns and moderate profitability limit the score.

Sinomax Group Ltd. Business Overview & Revenue Model

Company Description

Sinomax Group Ltd. (1418) is a company engaged in the production and sale of polyurethane (PU) foam products. The company's core products include memory foam pillows, mattresses, and other bedding products, which are sold under the Sinomax brand. Sinomax operates in the consumer goods sector, providing comfort-based products designed to enhance sleep quality and overall well-being for its customers.

How the Company Makes Money

Sinomax Group Ltd. generates revenue primarily through the manufacturing and sale of its polyurethane foam products. The company sells its products through various retail channels, including direct-to-consumer sales, as well as through partnerships with major retailers. Sinomax benefits from economies of scale by producing a large volume of foam products, which allows it to maintain competitive pricing while ensuring product quality. The company's earnings are also supported by its focus on innovation in product development, leveraging advanced foam technologies to meet consumer demand for comfort and support. Additionally, Sinomax may engage in licensing agreements or partnerships with other brands to expand its market reach and enhance its revenue streams.

Sinomax Group Ltd. Financial Statement Overview

Summary

Sinomax Group Ltd. shows positive revenue growth and improved operational margins. However, profitability and cash flow stability remain challenges, with recent cash flow concerns indicating potential liquidity issues.

Income Statement

Sinomax Group Ltd. has shown a positive revenue growth trend over the years, with a significant increase from 2023 to 2024. The gross profit margin has also improved, indicating enhanced cost management. However, the net profit margin remains relatively low, though there has been a notable improvement compared to previous losses. The EBIT and EBITDA margins have shown recovery, reflecting better operational efficiency.

Balance Sheet

The company's balance sheet reflects moderate leverage, with a stable debt-to-equity ratio. Stockholders' equity has increased, contributing to a better equity ratio. However, the return on equity (ROE) is moderate, indicating room for improvement in profitability relative to equity.

Cash Flow

Sinomax Group Ltd.'s cash flow situation shows potential concerns, with operating cash flow and free cash flow at zero in the latest period. Previous periods showed positive free cash flow growth, but the recent lack of free cash flow could pose liquidity challenges. Despite past positive cash flow to net income ratios, recent data is unavailable for a comprehensive assessment.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.09B	3.61B	3.15B	4.26B	3.23B
Gross Profit	1.05B	919.72M	586.55M	716.95M	623.82M
EBITDA	324.37M	320.07M	165.32M	234.82M	251.80M
Net Income	138.07M	62.59M	-35.97M	15.30M	58.52M
Balance Sheet
Total Assets	2.56B	2.41B	2.24B	2.83B	2.51B
Cash, Cash Equivalents and Short-Term Investments	262.44M	309.92M	168.96M	229.71M	147.18M
Total Debt	743.79M	722.62M	822.00M	944.87M	785.45M
Total Liabilities	1.56B	1.49B	1.35B	1.82B	1.56B
Stockholders Equity	973.71M	925.76M	895.20M	992.82M	954.51M
Cash Flow
Free Cash Flow	184.10M	358.11M	98.55M	69.70M	46.68M
Operating Cash Flow	206.16M	420.35M	149.60M	118.34M	76.11M
Investing Cash Flow	-82.70M	-49.46M	-20.79M	18.62M	20.61M
Financing Cash Flow	-214.09M	-231.43M	-191.18M	-55.86M	-197.91M

Sinomax Group Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.31
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1418, the sentiment is Positive. The current price of 0.31 is above the 20-day moving average (MA) of 0.29, above the 50-day MA of 0.29, and above the 200-day MA of 0.27, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 81.93 is Negative, neither overbought nor oversold. The STOCH value of 67.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1418.

Sinomax Group Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1418	72 Outperform	HK$551.25M	3.93	14.54%	7.30%	13.36%	120.39%
1373	70 Outperform	HK$650.96M	7.75	9.47%	4.35%	-4.58%	-31.73%
Sector *	57 Neutral	HK$26.40B	4.11	-2.03%	5.49%	-0.23%	-68.02%
0396	51 Neutral	HK$79.19M	5.16	19.25%	―	20.86%	―
1575	43 Neutral	HK$180.55M	―		―	-37.59%	-244.66%
1198	42 Neutral	HK$714.60M	―		3.85%	―	―
2127	41 Neutral	HK$76.58M	―	-38.40%	―	-72.73%	-764.81%

Sinomax Group Ltd. Corporate Events

Sinomax Group Ltd. Acquires Key Intellectual Property from Kimberly

Sinomax Group Ltd., through its subsidiary Sinomax USA, has entered into an agreement to acquire intellectual property from Kimberly, a Delaware-based company, for US$4.6 million. This acquisition, classified as a discloseable transaction under Hong Kong’s Listing Rules, involves the transfer of various IP rights related to household goods and accessory products, potentially enhancing Sinomax’s market position and operational capabilities.

Sinomax Group Updates Nomination Committee Terms for Enhanced Governance

Sinomax Group Limited has announced amendments to the terms of reference for its Nomination Committee, which is part of its Board of Directors. These changes, effective from July 1, 2025, aim to enhance the governance structure by ensuring a diverse and competent board composition. The amendments align with the Corporate Governance Code under the Hong Kong Stock Exchange’s listing rules, emphasizing the importance of independent non-executive directors and gender diversity within the committee.

Sinomax Group Announces Unanimous Approval of AGM Resolutions

Sinomax Group Limited, a company incorporated in the Cayman Islands, announced the successful approval of all resolutions at its Annual General Meeting held on May 16, 2025. The resolutions, which were passed unanimously, included the approval of the company’s audited financial statements, the declaration of a final dividend, the re-election of directors, and the re-appointment of PricewaterhouseCoopers as auditors.

Sinomax Group Announces Nomination Committee Change

Sinomax Group Limited has announced a change in the composition of its nomination committee. Ms. Lam Fei Man, an executive director, has been appointed as a member of the nomination committee, effective from May 16, 2025. This appointment may influence the company’s governance and decision-making processes, potentially impacting its strategic direction and stakeholder relations.

Sinomax Group Announces Board Restructuring

Sinomax Group Limited has announced changes to its board of directors, effective from May 16, 2025. The board comprises a mix of non-executive, executive, and independent non-executive directors, with Mr. Lam Chi Fan serving as the Chairman. The announcement outlines the roles and functions of each director within the company’s four board committees, which include Audit, Corporate Governance, Nomination, and Remuneration Committees. This restructuring of the board is likely aimed at strengthening corporate governance and enhancing strategic oversight within the company.