Best Food Holding Co. Ltd. (1488) AI Stock Analysis

• Market Cap: HK$1.58B
• Dividend Yield: N/A
• Average Volume (3M): 608.80K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.21
• Revenue Growth: -23.85%
• EPS Growth: -59.56%
• Country: HK
• Employees: 1,582
• Sector: Consumer Cyclical
• Sector Strength: 56
• Industry: Restaurants
• EPS (TTM): -0.14
• Shares Outstanding: 1,578,664,000
• 10 Day Avg. Volume: 1,000
• 30 Day Avg. Volume: 608,800
• PEG Ratio: 0.08
• Price to Book (P/B): 6.38
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 14.89
• 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: 39 Underperform
• Price Target: ―

Best Food Holding Co. Ltd. is currently facing severe financial difficulties, with declining revenues, negative equity, and zero operating cash flow posing significant risks. While technical indicators show some mixed momentum, the overall financial instability and unattractive valuation create a challenging environment for the stock. The company needs to make substantial improvements in its operations and financial health to improve its stock performance.

Best Food Holding Co. Ltd. Business Overview & Revenue Model

Company Description

Best Food Holding Company Limited, an investment holding company, operates a chain of restaurants in the People's Republic of China and internationally. It operates Chinese fast food and hot pot restaurants. As of December 31, 2021, the company operated approximately 700 stores under Best Food brands, including 500 direct-owned and 216 franchised stores. It also provides technical consultation, wholesale and retail, leasing and business, and catering management services; and manufactures condiments. The company was formerly known as Lee & Man Handbags Holding Limited and changed its name to Best Food Holding Company Limited in October 2016. The company was incorporated in 2011 and is based in Central, Hong Kong. Best Food Holding Company Limited is a subsidiary of Sonic Tycoon Limited.

How the Company Makes Money

Best Food Holding Co. Ltd. generates revenue primarily through the operation and management of various restaurant brands and food retail businesses. The company earns income from direct sales of food and beverages in its restaurant outlets, franchise fees, and royalties from franchised businesses. Additionally, the company may engage in partnerships or joint ventures that contribute to its revenue streams. Best Food Holding Co. Ltd. focuses on expanding its brand portfolio and enhancing operational efficiencies to drive profitability and shareholder value.

Best Food Holding Co. Ltd. Financial Statement Overview

Summary

Best Food Holding Co. Ltd. is facing significant financial challenges. Declining revenues and profitability, along with a negative equity position and zero operating cash flow, indicate a precarious financial situation. The company must address its operational inefficiencies, reduce debt levels, and improve cash flow generation to stabilize its financial health.

Income Statement

The company has been experiencing declining revenues and profits over recent years, with a significant drop in revenue from 752.96M in 2021 to 494.17M in 2024. Gross profit margins are also shrinking, from 35.2% in 2020 to 23.7% in 2024, indicating declining operational efficiency. Net profit margin remains negative, with increasing losses, highlighting profitability challenges.

Balance Sheet

The balance sheet reveals a concerning negative equity position as of 2024, with stockholders' equity at -249.63M, indicating financial instability. The debt-to-equity ratio is not meaningful due to negative equity, but total debt remains high, posing a risk of over-leverage. The equity ratio has deteriorated from 40.2% in 2019 to a negative position, reflecting a weakened financial structure.

Cash Flow

The cash flow statement shows a troubling trend with zero operating cash flow in 2024, down from 83.48M in 2023, indicating a lack of liquidity. Free cash flow has turned negative, and the company has been unable to generate positive cash flow from operations, which is critical for sustainability.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
494.17M	610.62M	537.51M	752.96M	650.69M
	Gross Profit
117.17M	164.10M	117.81M	209.89M	351.52M
	EBIT
69.20M	-23.16M	-101.13M	-78.88M	-109.70M
	EBITDA
-12.77M	-18.23M	-18.38M	-473.49M	58.74M
	Net Income Common Stockholders
-241.83M	-151.66M	-166.71M	-651.84M	-151.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
44.83M	71.76M	100.82M	120.39M	151.67M
	Total Assets
801.68M	1.11B	1.34B	1.52B	2.16B
	Total Debt
772.46M	760.09M	781.37M	801.19M	817.79M
	Net Debt
751.13M	724.45M	747.27M	738.62M	694.05M
	Total Liabilities
1.02B	1.06B	1.13B	1.16B	1.16B
	Stockholders Equity
-249.63M	-17.00K	152.80M	286.99M	924.12M
Cash Flow		Free Cash Flow
0.00	71.59M	65.52M	28.95M	80.12M
	Operating Cash Flow
0.00	83.48M	81.91M	63.23M	112.90M
	Investing Cash Flow
0.00	24.50M	-31.86M	-7.68M	2.05M
	Financing Cash Flow
0.00	-106.28M	-78.84M	-114.13M	-123.36M

Best Food Holding Co. Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1488, the sentiment is Negative. The current price of 1 is below the 20-day moving average (MA) of 1.02, below the 50-day MA of 1.00, and above the 200-day MA of 0.96, indicating a neutral trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 41.55 is Neutral, neither overbought nor oversold. The STOCH value of 100.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:1488.

Best Food Holding Co. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3393	76 Outperform	HK$7.44B	9.75	13.34%	5.03%	18.17%	33.08%
3311	71 Outperform	HK$65.39B	6.66	14.62%	4.54%	1.21%	2.15%
Sector *	62 Neutral	$6.80B	11.08	2.79%	5.80%	2.68%	-24.86%
3318	51 Neutral	HK$2.00B	94.02	0.59%	―	-21.05%	-87.68%
3389	48 Neutral	$444.81M	13.54	-2.04%	―	-27.93%	-293.98%
1488	39 Underperform	HK$1.58B	―	-439.69%	―	-23.85%	-59.56%

Best Food Holding Co. Ltd. Corporate Events

Best Food Holding Co. Ltd. Announces Change in Share Registrar

Best Food Holding Co. Ltd. has announced a change in its Hong Kong branch share registrar and transfer office, effective from May 15, 2025. This operational shift to Tricor Investor Services Limited is expected to streamline the process for shareholders, ensuring efficient management of share transfers and collections.

Best Food Holding Extends Convertible Bond Maturity Date

Best Food Holding Co. Ltd. has announced an extension of the maturity date for its convertible bond with Sonic Tycoon, a controlling shareholder, by 25 months to December 2027. This extension, which maintains all other terms of the bond, is classified as a connected transaction under Hong Kong’s Listing Rules and requires approval from independent shareholders. The extension aims to provide the company with more flexibility in managing its financial obligations and could impact its financial strategy and stakeholder interests.

Best Food Holding Faces Financial Challenges Amidst Industry Competition

Best Food Holding Company Limited reported a challenging financial year ending December 2024, with a revenue decrease of 22.3% compared to the previous year, and a loss of RMB 257.851 million. Despite the overall industry pressure from increased competition and price wars, the company saw a 6.1% increase in total system sales and expanded its store network by over 110 new locations. Brands like HHG and Xinladao are focusing on innovation and expansion to counter market pressures, while Yujian Xiaomian and King of Clay Pot have achieved notable growth and profitability, indicating potential areas of strength within the company’s portfolio.

Best Food Holding Co. Ltd. Issues Profit Warning Amid Impairment Losses

Best Food Holding Co. Ltd. has issued a profit warning, anticipating an increase in net loss to not more than RMB280 million for the year ending December 31, 2024, compared to a net loss of RMB163 million in 2023. This expected loss is primarily due to the impairment of trademarks and investments in certain associates, driven by the closure and underperformance of some restaurants and a decrease in enterprise value to sales multiples. Despite these challenges, the company plans to adjust its business strategies to maintain stable cash flow and continue its long-term development strategy.