SH Group (Holdings) Limited (1637) AI Stock Analysis

• Market Cap: HK$65.20M
• Dividend Yield: N/A
• Average Volume (3M): 18.27K
• Price to Earnings (P/E): 12.1
• Beta (1Y): 0.47
• Revenue Growth: -30.55%
• EPS Growth: N/A
• Country: HK
• Employees: 157
• Sector: Industrials
• Sector Strength: 84
• Industry: Engineering & Construction
• EPS (TTM): 0.04
• Shares Outstanding: 400,000,000
• 10 Day Avg. Volume: 17,800
• 30 Day Avg. Volume: 18,266
• PEG Ratio: -0.07
• Price to Book (P/B): 0.21
• Price to Sales (P/S): 0.08
• P/FCF Ratio: 0.55
• 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: Hold
• Number of Analyst Covering: 1

• Rating: 66 Neutral
• Price Target: HK$0.00 ▼(-100.00% Downside)

The stock of SH Group (Holdings) Limited is moderately attractive, driven by strong technical indicators and a solid balance sheet. While the company is recovering with improved cash flow, challenges remain with declining revenue and low profit margins. The valuation is reasonable, but the lack of dividend yield may deter some investors.

SH Group (Holdings) Limited Business Overview & Revenue Model

Company Description

SH Group (Holdings) Limited is a Hong Kong-based investment holding company that primarily operates within the construction and engineering sectors. The company focuses on providing comprehensive construction services, including civil engineering, building construction, and infrastructure development. Its core products and services encompass project management, planning, and execution, catering to both public and private sector clients.

How the Company Makes Money

SH Group (Holdings) Limited generates revenue through various streams, primarily by undertaking construction contracts for infrastructure and building projects. The company's revenue model is based on fixed-price contracts, cost-plus contracts, and time-and-material contracts, allowing it to cater to diverse client needs. Key revenue streams include income from civil engineering works, building construction projects, and maintenance services. Additionally, the company may engage in joint ventures and partnerships with other firms in the industry, which can enhance project scope and execution capabilities, contributing to its overall earnings. The firm's ability to secure contracts through competitive bidding and maintain strong relationships with government entities and private developers plays a crucial role in sustaining its revenue growth.

SH Group (Holdings) Limited Financial Statement Overview

Summary

SH Group (Holdings) Limited is showing signs of recovery with improved profitability and strong cash flow growth. However, the company faces challenges with declining revenue and low profit margins. The balance sheet remains strong with low leverage, providing a stable foundation for future growth.

Income Statement

The company has experienced a significant decline in revenue over the past year, with a revenue growth rate of -18.33%. Gross profit margin is low at 5.42%, and net profit margin is also weak at 0.89%. However, the company has managed to return to profitability with a positive net income, indicating some recovery from previous losses.

Balance Sheet

The balance sheet shows a strong equity position with a very low debt-to-equity ratio of 0.23%. Return on equity is modest at 2.30%, suggesting limited profitability relative to equity. The equity ratio is healthy, indicating a stable financial structure with low leverage risk.

Cash Flow

The company has shown a strong improvement in cash flow, with a free cash flow growth rate of 28.82%. The operating cash flow to net income ratio is 0.62, indicating good cash generation relative to net income. Free cash flow closely matches net income, suggesting efficient cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	745.05M	608.49M	876.18M	954.25M	753.33M	707.59M
Gross Profit	11.86M	32.97M	16.29M	8.66M	45.60M	61.40M
EBITDA	-16.67M	10.84M	-12.77M	-10.45M	19.28M	55.49M
Net Income	-12.98M	5.39M	-15.21M	-11.00M	11.73M	44.13M
Balance Sheet
Total Assets	410.50M	378.04M	495.45M	506.74M	508.11M	512.38M
Cash, Cash Equivalents and Short-Term Investments	80.56M	99.87M	44.63M	114.46M	249.54M	241.04M
Total Debt	11.65M	534.00K	37.59M	630.00K	2.75M	4.34M
Total Liabilities	190.34M	143.75M	266.54M	262.62M	217.28M	217.68M
Stockholders Equity	220.16M	234.29M	228.91M	244.12M	290.84M	294.70M
Cash Flow
Free Cash Flow	68.71M	88.51M	-119.71M	-118.04M	46.06M	138.60M
Operating Cash Flow	69.02M	88.52M	-119.39M	-117.51M	46.42M	138.84M
Investing Cash Flow	6.04M	3.04M	71.83M	-50.22M	-15.14M	-25.72M
Financing Cash Flow	-34.01M	-38.68M	30.84M	-20.44M	-17.78M	-16.44M

SH Group (Holdings) Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.16
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1637, the sentiment is Positive. The current price of 0.16 is above the 20-day moving average (MA) of 0.15, above the 50-day MA of 0.15, and above the 200-day MA of 0.13, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 64.01 is Neutral, neither overbought nor oversold. The STOCH value of 41.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1637.

SH Group (Holdings) Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1591	66 Neutral	HK$64.00M	36.39	-3.98%	―	-50.14%	-114.40%
1637	66 Neutral	HK$65.20M	12.07	2.33%	―	-30.55%	―
Sector *	58 Neutral	HK$13.55B	5.55	-2.78%	5.86%	2.50%	-57.10%
1826	55 Neutral	HK$98.57M	10.00	-265.97%	―	141.76%	―
1472	52 Neutral	HK$58.00M	―	-3.05%	―	67.24%	-42.19%
1630	49 Neutral	HK$75.00M	―	-8.05%	―	-29.39%	78.42%
1718	48 Neutral	HK$56.02M	―	-72.83%	―	4.32%	-143.93%

SH Group (Holdings) Limited Corporate Events

SH Group Announces Annual General Meeting with Key Resolutions

SH Group (Holdings) Limited has announced its upcoming annual general meeting, scheduled for August 29, 2025, in Hong Kong. Key agenda items include the adoption of financial statements, the re-election of directors, and the re-appointment of Deloitte Touche Tohmatsu as auditors. Additionally, the meeting will consider authorizing the board to issue additional shares, subject to specific conditions, which could impact the company’s capital structure and shareholder value.

SH Group Updates Audit Committee Terms to Strengthen Governance

SH Group (Holdings) Limited has announced revisions to the terms of reference for its Audit Committee, effective from June 25, 2025. These changes include the composition and quorum requirements, emphasizing the need for independent non-executive directors with appropriate qualifications to ensure compliance with listing rules. This move is likely to strengthen the company’s governance framework and enhance its financial oversight capabilities.

SH Group Updates Nomination Committee Terms

SH Group (Holdings) Limited has announced revisions to the terms of reference for its Nomination Committee, effective from June 25, 2025. The committee, which plays a crucial role in the governance of the company, will continue to be composed of at least three directors, with a majority being independent non-executive directors and at least one member of a different gender. This update reflects the company’s commitment to diversity and effective governance, potentially impacting its operational transparency and stakeholder trust.

SH Group Reports Turnaround with Profit in FY2025 Despite Revenue Drop

SH Group (Holdings) Limited reported its annual results for the year ended March 31, 2025, showing a notable decrease in revenue to HK$608.5 million from HK$876.2 million in the previous year. Despite the drop in revenue, the company achieved a turnaround with a profit of HK$5.4 million compared to a loss of HK$15.2 million the previous year, indicating improved operational efficiency and cost management.

SH Group Proposes Amendments to Articles of Association

SH Group (Holdings) Limited has announced proposed amendments to its Articles of Association to align with the latest requirements of the Hong Kong Stock Exchange Listing Rules. These amendments aim to enhance electronic communication, allow the holding of treasury shares, and make housekeeping changes for legal and operational clarity. The adoption of these changes is subject to shareholder approval at the upcoming annual general meeting.

SH Group Announces Board Meeting to Review Annual Results and Dividend

SH Group (Holdings) Limited has announced a board meeting scheduled for June 25, 2025, to discuss and approve the annual results for the fiscal year ending March 31, 2025, and to consider the recommendation of a final dividend. This meeting is significant as it will provide insights into the company’s financial performance and potential returns for shareholders, impacting its market positioning and stakeholder interests.

SH Group Projects Positive Turnaround with HK$2.0 Million Profit

SH Group (Holdings) Limited has announced a positive profit alert, projecting a net profit of at least HK$2.0 million for the fiscal year ending March 31, 2025, compared to a net loss of approximately HK$15.2 million the previous year. This anticipated turnaround is primarily attributed to an increase in the value of financial assets and higher revenue and gross profit from variation orders with improved margins. The company advises caution as the results are based on preliminary assessments and are subject to adjustments.

SH Group Secures Continued Banking Facilities with Key Leadership Conditions

SH Group (Holdings) Limited announced that its banking facilities with a maximum amount of HK$150,000,000 have been renewed by the bank following a periodic review. The continuation of the facility is contingent upon Mr. Yu Cheung Choy and Mr. Lau Man Ching maintaining their positions as the largest shareholders and executive directors. This arrangement underscores the importance of their leadership in the company’s strategic operations and financial stability, with any breach potentially leading to immediate repayment obligations.