Precision Tsugami (China) Corp. Ltd. (1651) AI Stock Analysis

• Market Cap: HK$7.74B
• Dividend Yield: 8.85%
• Average Volume (3M): 1.31M
• Price to Earnings (P/E): 11.9
• Beta (1Y): 0.46
• Revenue Growth: 5.23%
• EPS Growth: 17.63%
• Country: HK
• Employees: 2,240
• Sector: Industrials
• Sector Strength: 85
• Industry: Manufacturing - Tools & Accessories
• EPS (TTM): 0.97
• Shares Outstanding: 380,554,000
• 10 Day Avg. Volume: 1,130,914
• 30 Day Avg. Volume: 1,308,424
• PEG Ratio: -0.35
• Price to Book (P/B): 1.05
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 3.74
• 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: 74 Outperform
• Price Target: ―

Precision Tsugami demonstrates strong financial health with consistent profitability and a solid balance sheet, bolstered by low leverage. Despite positive technical indicators, the lack of recent earnings call data leaves some uncertainty regarding future guidance. The stock's attractive valuation, with a reasonable P/E ratio and solid dividend yield, further supports its investment case. Nevertheless, the recent decline in revenue and cash flows suggests a need for strategic focus on growth.

Precision Tsugami (China) Corp. Ltd. Business Overview & Revenue Model

Company Description

Precision Tsugami (China) Corporation Limited, an investment holding company, manufactures and sells computer numerical control machine tools primarily in Mainland China and Taiwan. The company offers precision turret machines, precision automatic lathes, precision machine centers, precision grinding machines, precision thread and form rolling machines, and other components under the TSUGAMI brand name. Its products are used in various industries, such as automobile parts and components, mobile phones and communication facilities, automation, medical instruments, and construction machinery. The company also exports its products to Japan, South Korea, Europe, the United States, and internationally. The company was founded in 2003 and is based in Pinghu, China. Precision Tsugami (China) Corporation Limited is a subsidiary of Tsugami Corporation.

How the Company Makes Money

Precision Tsugami (China) Corp. Ltd. generates its revenue primarily through the sale of its precision machinery products. The company's key revenue streams include the sale of CNC lathes, machining centers, and other precision equipment to various industrial sectors. Additionally, the company may earn income from providing after-sales services, maintenance, and spare parts to its clients. Strategic partnerships with industrial players and a strong distribution network also contribute to the company's earnings, enabling it to reach a broad customer base across different markets.

Precision Tsugami (China) Corp. Ltd. Financial Statement Overview

Summary

Precision Tsugami (China) Corp. Ltd. showcases financial strength with consistent profitability and a strong balance sheet. The company has demonstrated operational efficiency and maintains low leverage, which reduces financial risk. However, recent revenue dips and declines in cash flow suggest potential challenges in sustaining growth, necessitating strategic initiatives to enhance sales and cash generation.

Income Statement

Precision Tsugami has demonstrated a stable gross profit margin of approximately 29% to 30% over the years with a slight decrease in total revenue in 2024 compared to 2023. The net profit margin has been consistent, ranging between 12% and 14% over the analyzed period. The EBIT and EBITDA margins have shown stability, reflecting efficient operating performance. However, the recent decline in revenue indicates a need for strategic focus on growth.

Balance Sheet

The company maintains a robust equity base, with an equity ratio of around 75% or higher, indicating strong financial stability. The debt-to-equity ratio is exceptionally low, demonstrating minimal reliance on debt financing. Return on equity has been strong, although it has slightly decreased from 2023 to 2024. The balance sheet reflects prudent financial management and a low-risk profile.

Cash Flow

Operating cash flow remains solid, though it decreased in 2024 compared to 2023, affecting free cash flow growth. The company consistently generates positive free cash flow, with a healthy free cash flow to net income ratio, indicating good cash generation relative to earnings. Despite a decline in cash flows, the company is managing its capital expenditures efficiently.

Breakdown
TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
3.60B	3.12B	4.05B	4.42B	3.12B	1.94B
	Gross Profit
1.12B	895.54M	1.04B	1.17B	765.31M	392.09M
	EBIT
726.72M	681.78M	783.16M	913.62M	543.74M	207.84M
	EBITDA
850.17M	762.46M	840.03M	967.44M	587.07M	252.72M
	Net Income Common Stockholders
598.75M	479.97M	579.19M	667.40M	391.95M	155.82M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
948.52M	1.11B	977.57M	570.93M	430.12M	325.01M
	Total Assets
3.75B	3.63B	3.51B	3.51B	2.71B	1.93B
	Total Debt
3.68M	4.09M	3.16M	24.84M	3.29M	2.99M
	Net Debt
-944.84M	-1.11B	-974.41M	-546.10M	-426.82M	-202.02M
	Total Liabilities
854.74M	930.65M	980.47M	1.29B	950.61M	460.57M
	Stockholders Equity
2.90B	2.70B	2.53B	2.22B	1.76B	1.47B
Cash Flow		Free Cash Flow
174.58M	417.83M	709.28M	332.21M	201.63M	24.67M
	Operating Cash Flow
237.60M	505.81M	763.40M	429.51M	300.77M	175.95M
	Investing Cash Flow
215.38M	-154.79M	-383.28M	-117.31M	30.19M	-266.42M
	Financing Cash Flow
-315.03M	-311.59M	-296.98M	-186.88M	-105.86M	-104.80M

Precision Tsugami (China) Corp. Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 20.35
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1651, the sentiment is Neutral. The current price of 20.35 is below the 20-day moving average (MA) of 21.07, below the 50-day MA of 20.92, and above the 200-day MA of 15.01, indicating a neutral trend. The MACD of -0.31 indicates Positive momentum. The RSI at 45.57 is Neutral, neither overbought nor oversold. The STOCH value of 64.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HK:1651.

Precision Tsugami (China) Corp. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1651	74 Outperform	HK$7.74B	11.86	21.60%	8.85%	5.23%	17.63%
Sector *	66 Neutral	$4.47B	12.21	5.40%	3.65%	4.14%	-12.00%
CSDXF		$6.33B	7.96	9.73%	6.06%	―	―
CTPCF		$41.43B	4.86	7.93%	3.95%	―	―
GWLLF		$22.71B	8.69	14.58%	2.56%	―	―
SNPMF		$93.29B	9.28		26.17%	―	―
WEICF		$18.66B	11.44	13.40%	9.97%	―	―

Precision Tsugami (China) Corp. Ltd. Corporate Events

Precision Tsugami (China) Reports 60% Profit Surge Amid Industry Recovery

Precision Tsugami (China) Corporation Limited has announced a significant profit increase of approximately 60% for the fiscal year ending March 31, 2025, with profits expected to reach RMB782 million. This growth is attributed to a recovery in the domestic manufacturing sector, increased capital expenditure in key industries, and the company’s strategic expansion efforts. The company has also implemented cost reduction and efficiency improvement initiatives, contributing to its strong financial performance. The machine tool industry remains subject to cyclical changes, aligning with the company’s expectations.

Precision Tsugami Expands Production Capacity with New Land Acquisition

Precision Tsugami (China) Corporation Limited has announced plans to expand its production capacity by acquiring a parcel of land in the Pinghu Economic Technological Development Zone, China. This strategic move aims to construct a new production plant to meet the rising demand for CNC high precision machine tools, driven by the rapid growth in the automotive, humanoid robot, and AI sectors. The expansion is expected to strengthen the company’s industry position and enhance its competitiveness.