Kwan On Holdings Ltd. (1559) AI Stock Analysis

• Market Cap: HK$171.96M
• Dividend Yield: N/A
• Average Volume (3M): 155.67K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.67
• Revenue Growth: 9.07%
• EPS Growth: -6.24%
• Country: HK
• Employees: 97
• Sector: Industrials
• Sector Strength: 90
• Industry: Engineering & Construction
• EPS (TTM): -0.03
• Shares Outstanding: 1,869,159,900
• 10 Day Avg. Volume: 36,000
• 30 Day Avg. Volume: 155,666
• PEG Ratio: -0.14
• Price to Book (P/B): 1.21
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 2.13
• 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: 40 Underperform
• Price Target: ―

Kwan On Holdings Ltd. faces significant financial instability, with declining revenue and profitability posing major challenges. The technical analysis indicates weak momentum, and the valuation is unattractive due to ongoing losses. The company must focus on operational efficiency and revenue growth to improve its financial health.

Kwan On Holdings Ltd. Business Overview & Revenue Model

Company Description

Kwan On Holdings Limited, an investment holding company, engages in the construction and property development business in Hong Kong and internationally. It operates through Construction, Property Development, and Trading segments. The company offers construction and maintenance works on civil engineering contracts and building works contracts. It undertakes works related to buildings, waterworks, site formation, roads, and drainage services. The company also engages in the provision of contracting work on civil plumbing, fire protection, insulation, concrete repair, and related activities; property holding activities; and provision of construction site workmen services, as well as is involved in the trade of diesel and chemical materials. In addition, it develops and sells residential units, commercial units, and car parking spaces. The company was founded in 1975 and is headquartered in Central and Western, Hong Kong.

How the Company Makes Money

Kwan On Holdings Ltd. makes money primarily through its construction services, which involve building and engineering projects for both governmental and private clients. The company generates revenue by undertaking contracts for infrastructure projects, such as roads, bridges, and public facilities. These contracts often involve long-term projects where Kwan On Holdings Ltd. earns money based on project milestones and completion. Key revenue streams include payments from government contracts, private developers, and partnerships with other construction firms. Additionally, the company might engage in joint ventures or partnerships with other engineering firms to expand its project base and enhance its service offerings. Strategic partnerships and a strong reputation in the construction industry contribute significantly to its earnings.

Kwan On Holdings Ltd. Financial Statement Overview

Summary

Kwan On Holdings Ltd. is facing significant financial challenges, with declining revenues and persistent losses impacting its profitability. While there is some improvement in cash management, the company's debt levels and negative return on equity highlight ongoing financial instability. Strategic focus on improving operational efficiency and revenue generation is critical for recovery.

Income Statement

The company has shown a consistent decline in revenue with a negative revenue growth rate from 2023 to 2024. Gross profit margin and net profit margin are negative, indicating poor profitability. EBIT and EBITDA margins are also negative, reflecting operational inefficiencies.

Balance Sheet

The debt-to-equity ratio has improved slightly as total debt decreased from 2023 to 2024, but it remains a concern. Return on equity is negative due to losses, indicating poor return for shareholders. The equity ratio is stable, suggesting some level of balance between assets and equity.

Cash Flow

The company has seen a positive turnaround in free cash flow from negative in 2023 to positive in 2024, indicating improved cash management. Operating cash flow to net income ratio is positive, suggesting operational cash generation despite net losses. However, free cash flow to net income ratio remains a concern.

Breakdown	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	654.45M	624.19M	515.36M	538.73M	599.91M
Gross Profit	-118.25M	-31.59M	-35.72M	12.07M	66.01M
EBITDA	-167.25M	-87.30M	-47.78M	-182.00K	36.48M
Net Income	-155.40M	-111.72M	-67.97M	-24.41M	16.22M
Balance Sheet
Total Assets	650.74M	854.54M	808.94M	959.07M	927.80M
Cash, Cash Equivalents and Short-Term Investments	26.54M	47.62M	149.35M	172.43M	109.53M
Total Debt	88.46M	181.03M	250.48M	243.38M	269.59M
Total Liabilities	517.14M	514.88M	382.80M	437.91M	411.65M
Stockholders Equity	170.01M	341.52M	427.53M	521.70M	516.52M
Cash Flow
Free Cash Flow	30.68M	-52.33M	-19.14M	103.95M	-276.64M
Operating Cash Flow	31.32M	-49.01M	-17.03M	114.73M	-267.81M
Investing Cash Flow	39.55M	-14.61M	2.71M	-4.15M	-519.00K
Financing Cash Flow	-90.20M	-29.22M	-8.70M	-43.38M	260.81M

Kwan On Holdings Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.09
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1559, the sentiment is Negative. The current price of 0.09 is above the 20-day moving average (MA) of 0.09, above the 50-day MA of 0.09, and below the 200-day MA of 0.11, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 48.26 is Neutral, neither overbought nor oversold. The STOCH value of 21.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:1559.

Kwan On Holdings Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9998	64 Neutral	HK$144.80M	7.01	8.54%	―	43.39%	38.64%
Sector *	58 Neutral	HK$14.11B	4.63	-3.01%	6.76%	3.67%	-54.16%
1757	53 Neutral	HK$134.40M	124.44	1.19%	―	-34.92%	―
1865	52 Neutral	HK$202.60M	―	-17.85%	―	-20.23%	-1808.04%
1707	51 Neutral	HK$176.40M	―	-9.34%	―	-40.18%	3.09%
1459	50 Neutral	HK$178.68M	32.35	0.31%	6.06%	-20.04%	-58.20%
1559	40 Underperform	HK$171.96M	―	-54.25%	―	9.07%	-6.24%

Kwan On Holdings Ltd. Corporate Events

Kwan On Holdings Granted Waiver for Circular Dispatch Delay

Kwan On Holdings Ltd. announced a delay in the dispatch of a circular related to a major transaction involving a disposal and guarantee. The company received a waiver from the Hong Kong Stock Exchange to extend the dispatch deadline to May 23, 2025, due to the need for additional time to finalize important financial statements. This extension allows Kwan On Holdings to ensure compliance with listing rules while maintaining transparency with its shareholders.

Kwan On Holdings Completes Major Transaction with Subsidiary Disposal

Kwan On Holdings Limited, listed on the Hong Kong Stock Exchange, has completed a major transaction involving the disposal of a subsidiary and the provision of financial assistance. This completion marks a significant change in the company’s structure as the target company will no longer be consolidated within the group’s financial results, potentially impacting its financial reporting and strategic focus.

Kwan On Holdings Announces Major Subsidiary Disposal and Financial Assistance

Kwan On Holdings Limited announced a major transaction involving the disposal of a wholly-owned subsidiary and the provision of financial assistance. This transaction will result in the subsidiary no longer being consolidated into the company’s financial results. The company will continue to provide a guarantee for a bank facility, and the transaction requires shareholder approval under the Hong Kong Stock Exchange Listing Rules. The company has already obtained the necessary written approval from a major shareholder, Sino Coronet, which holds a majority of the company’s shares.