Shun Wo Group Holdings Ltd. (1591) AI Stock Analysis

• Market Cap: HK$57.60M
• Dividend Yield: N/A
• Average Volume (3M): 989.07K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.67
• Revenue Growth: 11.27%
• EPS Growth: -1272.22%
• Country: HK
• Employees: 59
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): -0.04
• Shares Outstanding: 400,000,000
• 10 Day Avg. Volume: 2,452,600
• 30 Day Avg. Volume: 989,066
• PEG Ratio: 0.10
• Price to Book (P/B): 0.45
• Price to Sales (P/S): 0.38
• P/FCF Ratio: -5.07
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 47 Neutral
• Price Target: HK$0.15 ▲(6.43% Upside)

The score is primarily held back by weak financial performance quality—2025 losses and sharply negative operating/free cash flow—despite a conservatively financed balance sheet. Technicals add only modest support given mixed trend signals, and valuation remains pressured by loss-making results and no provided dividend yield.

Positive Factors

Conservative balance sheet

Very low leverage and a sizeable equity base provide structural resilience in the cyclical engineering and construction sector. This conservatism supports bidding capacity, access to credit when needed, and reduces solvency risk, enabling the firm to withstand multi-quarter downturns.

Historical revenue growth

Sustained revenue gains through 2023–2024 indicate the company can secure projects and grow top-line share. That track record suggests an established market position and backlog potential that can support recovery and medium-term revenue stability if execution normalizes.

Proven cash generation (2024)

The firm demonstrated it can convert earnings into free cash flow in favorable periods, evidencing underlying cash-generation capability. This structural ability reduces financing dependence and supports reinvestment or working-capital needs when margins and project delivery improve.

Negative Factors

Profitability reversal in 2025

A switch to losses and sharply negative operating/free cash flow signals inconsistent earnings power. Persistent earnings volatility undermines long-term return on equity and makes capital allocation, investment planning, and stakeholder confidence harder to sustain over multiple quarters.

Gross margin compression

Margin contraction points to structural pricing pressure or rising input costs versus historical levels. Sustained compression reduces operating leverage and the firm's ability to fund SG&A or reinvest, making long-term margin recovery and profitability more challenging without operational changes.

Deteriorating cash conversion / working capital strain

Marked deterioration in cash conversion increases funding and liquidity risk even with low debt. If working-capital pressure persists, the company may need external financing or scale back projects, which can impair growth, delay backlog conversion, and raise long-term funding costs.

Shun Wo Group Holdings Ltd. Business Overview & Revenue Model

Company Description

Shun Wo Group Holdings Limited, an investment holding company, undertakes various foundation works in Hong Kong. It undertakes excavation and lateral support, socketed H-piling and mini-piling, and pile caps construction works. The company was founded in 1995 and is headquartered in Sai Wan Ho, Hong Kong. Shun Wo Group Holdings Limited is a subsidiary of May City Holdings Limited.

How the Company Makes Money

Shun Wo Group Holdings Ltd. generates revenue mainly through its construction and engineering services. The company earns money by undertaking contracts for foundation works and related construction projects. These contracts often involve agreements with private developers and public sector entities for building infrastructure and other construction endeavors. The company's revenue streams are primarily from project-based work, where they bid for and secure contracts that stipulate the scope of work, timelines, and payment terms. Additionally, Shun Wo Group may engage in partnerships or joint ventures with other construction firms to undertake larger or more complex projects, thereby broadening its revenue opportunities. The company's profitability is influenced by factors such as the demand for construction services, the competitive landscape, and the efficiency with which it can complete projects within budget and time constraints.

Shun Wo Group Holdings Ltd. Financial Statement Overview

Summary

Financials are mixed. The balance sheet is a strength with very low leverage and solid equity support, but operating performance is volatile: 2025 swung back to losses with compressed gross margin, and cash generation deteriorated sharply with negative operating cash flow and deeply negative free cash flow.

Income Statement

Results are volatile. Revenue grew strongly into 2023–2024 (2024 up ~6.6% YoY), but 2025 revenue fell sharply versus 2024 despite still showing a positive growth rate in the dataset. Profitability swung from solid in 2024 (net margin ~11.8%, healthy operating margin) back to losses in 2025 (negative operating and net margins), indicating weak earnings consistency and potential project/margin normalization risk. Gross margin has also compressed from 2024 to 2025, reinforcing a less favorable pricing/cost backdrop.

Balance Sheet

The balance sheet looks conservatively financed with very low debt (debt-to-equity near zero across periods) and a sizeable equity base relative to assets, which provides resilience in a cyclical construction environment. However, profitability on equity has been inconsistent—strong in 2023–2024 but negative in 2025—suggesting that while leverage risk is low, returns are not stable and depend heavily on earnings execution.

Cash Flow

Cash generation has deteriorated meaningfully. 2024 showed strong operating cash flow and free cash flow that broadly tracked reported earnings, but 2025 flipped to negative operating cash flow and deeply negative free cash flow, pointing to working-capital strain and/or elevated investment needs. The sharp drop in free cash flow growth and weaker cash conversion increases funding and liquidity risk if the downturn persists, even with low balance-sheet leverage.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	180.94M	166.25M	333.43M	312.91M	242.29M	144.36M
Gross Profit	21.77M	25.34M	60.79M	22.35M	14.66M	18.26M
EBITDA	-10.42M	668.00K	45.75M	23.50M	944.00K	-3.65M
Net Income	-16.89M	-5.69M	39.47M	18.93M	-4.50M	-6.07M
Balance Sheet
Total Assets	180.88M	203.41M	203.41M	169.46M	142.19M	111.29M
Cash, Cash Equivalents and Short-Term Investments	82.06M	85.24M	93.39M	51.18M	22.98M	44.80M
Total Debt	385.00K	606.00K	0.00	0.00	0.00	0.00
Total Liabilities	57.13M	63.39M	57.70M	63.21M	54.87M	19.48M
Stockholders Equity	123.75M	140.02M	145.71M	106.25M	87.32M	91.81M
Cash Flow
Free Cash Flow	-9.98M	-12.30M	46.27M	28.16M	-23.82M	2.97M
Operating Cash Flow	-2.09M	-1.80M	48.90M	37.01M	-21.36M	12.34M
Investing Cash Flow	-6.58M	-6.04M	-541.00K	-6.81M	-454.00K	-11.27M
Financing Cash Flow	-429.00K	-316.00K	0.00	0.00	0.00	-67.00K

Shun Wo Group Holdings Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.14
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1591, the sentiment is Negative. The current price of 0.14 is below the 20-day moving average (MA) of 0.14, below the 50-day MA of 0.14, and below the 200-day MA of 0.15, indicating a bearish trend. The MACD of <0.01 indicates Positive momentum. The RSI at 47.70 is Neutral, neither overbought nor oversold. The STOCH value of 12.50 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:1591.

Shun Wo Group Holdings Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
1637	59 Neutral	HK$132.00M	12.94	4.53%	―	-40.54%	―
1472	50 Neutral	HK$91.00M	-6.55	-4.84%	―	71.16%	-67.47%
1591	47 Neutral	HK$57.60M	-3.41	-12.77%	―	11.27%	-1272.22%
1718	46 Neutral	HK$77.59M	-0.86	-46.48%	―	-0.64%	13.72%
2195	43 Neutral	HK$76.96M	-2.41	-19.00%	―	48.86%	54.49%

Shun Wo Group Holdings Ltd. Corporate Events

Shun Wo Group Announces HK$18.67 Million Rights Issue

Shun Wo Group Holdings Ltd. has announced a proposed rights issue to raise up to approximately HK$18.67 million by issuing 133,333,333 Rights Shares at HK$0.14 each. The proceeds are intended for acquiring plant and machinery and general working capital. The rights issue is non-underwritten and available only to qualifying shareholders, with no minimum subscription level required. The company has ensured compliance with relevant listing rules, indicating no significant dilution effect on its share capital.

Shun Wo Group Holdings Reports Increased Revenue but Rising Losses in Interim Results

Shun Wo Group Holdings Ltd. reported its unaudited interim results for the six months ending September 30, 2025, revealing a significant increase in revenue to HK$78,730,000 from HK$64,040,000 in the same period in 2024. Despite the revenue growth, the company faced increased direct costs and administrative expenses, resulting in a loss of HK$16,271,000, a notable rise from the previous year’s loss of HK$5,077,000. This financial performance indicates challenges in managing operational costs, which could impact the company’s market positioning and stakeholder confidence.

Shun Wo Group Issues Profit Warning Amid Rising Losses

Shun Wo Group Holdings Limited has issued a profit warning, anticipating a significant increase in net loss for the six months ending September 2025, compared to the same period in 2024. The increase in net loss is attributed to intense competition in the foundation industry, reduced income from bank deposits and project management fees, higher impairment losses, and increased administrative expenses.

Shun Wo Group Holdings Ltd. Announces Board Meeting for Interim Results Review

Shun Wo Group Holdings Ltd. has announced a board meeting scheduled for November 27, 2025, to review and approve the unaudited interim results for the six months ending September 30, 2025, and to consider the declaration of an interim dividend. This meeting is significant for stakeholders as it will provide insights into the company’s financial performance and potential dividend payouts, which could impact the company’s market positioning and investor relations.

Shun Wo Group Holdings Announces Shareholding Structure Change

Shun Wo Group Holdings Limited announced a change in the shareholding structure of its controlling shareholder, May City. Mr. YH Wong has acquired an additional 30% shareholding interest from Mr. Lai, resulting in Mr. Wong holding 70% and Mr. Tony Wong holding 30% of May City. This transaction does not impact the management and operations of the company.

Shun Wo Group Holdings Ltd. Announces Board and Committee Structure

Shun Wo Group Holdings Ltd. has announced the composition of its board of directors and the roles within its established committees. The announcement outlines the leadership structure, potentially impacting the company’s governance and strategic decision-making, which may influence stakeholder confidence.