Welife Technology Limited (1703) AI Stock Analysis

• Market Cap: HK$55.20M
• Dividend Yield: N/A
• Average Volume (3M): 0.00
• Price to Earnings (P/E): 4.4
• Beta (1Y): -1.35
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: HK
• Employees: 224
• Sector: Consumer Cyclical
• Sector Strength: 66
• Industry: Restaurants
• EPS (TTM): -0.01
• Shares Outstanding: 1,150,000,000
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 0
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: 56 Neutral
• Price Target: ―

Welife Technology's strong revenue growth and improved profitability are offset by significant challenges in cash generation and financial stability. The technical analysis does not indicate any strong trends, and lack of valuation metrics adds uncertainty. Overall, the stock presents moderate potential but with notable risks.

Welife Technology Limited Business Overview & Revenue Model

Company Description

Palace Banquet Holdings Limited, an investment holding company, operates restaurants in Hong Kong. The company offers Cantonese dining and banquet services, including wedding banquet services. As of March 31, 2022, it operated seven Chinese full-service restaurants under the Palace brand name, one restaurant under the Royal Courtyard brand name, and one restaurant operating under the Sea Moon Cuisine brand name. The company was formerly known as The Palace Holdings Limited and changed its name to Palace Banquet Holdings Limited in October 2018. Palace Banquet Holdings Limited was founded in 2006 and is headquartered in Wan Chai, Hong Kong.

How the Company Makes Money

Welife Technology Limited generates revenue through a combination of product sales, service contracts, and strategic partnerships. The company earns money by selling its technology products directly to consumers and businesses, offering software licensing agreements, and providing subscription-based services. Additionally, Welife Technology leverages partnerships with other tech firms to expand its market reach and enhance its product offerings, leading to increased sales and recurring revenue streams. The company also invests in research and development to innovate and maintain a competitive edge in the technology sector.

Welife Technology Limited Financial Statement Overview

Summary

Welife Technology shows strong revenue growth and improved profitability, but faces challenges in cash generation and financial stability. While leverage has decreased, the company remains at risk due to its low equity base and insufficient cash flow generation.

Income Statement

Welife Technology has shown a significant improvement in its income statement metrics. The gross profit margin improved from 24.39% in 2023 to 30.69% in 2024, indicating better cost management. The net profit margin turned positive at 6.83% in 2024, a substantial recovery from the negative margins in previous years. Revenue growth was robust at 38.77% in 2024, demonstrating strong topline growth. However, the EBIT margin at 30.69% in 2024 reflects dependency on non-operating items, as EBITDA margin showed a decrease from the prior year.

Balance Sheet

The balance sheet shows a mixed picture. While the debt-to-equity ratio improved to 1.81 in 2024, indicating reduced leverage, the company still carries significant debt levels. Return on Equity (ROE) was strong at 70.61% in 2024, showing efficient use of equity, but this is partly due to low equity levels. The equity ratio remains low at 22.24%, suggesting higher financial risk.

Cash Flow

The cash flow statement reveals challenges, as operating cash flow and free cash flow were reported as zero in 2024, which might indicate issues in cash generation. In previous years, free cash flow growth showed positive trends, but the current lack of operating cash flow is concerning. The absence of cash flows in 2024 suggests potential liquidity management issues.

Breakdown	TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement
Total Revenue	345.28M	422.41M	304.36M	294.12M	224.08M	650.80M
Gross Profit	87.88M	129.66M	113.61M	112.23M	73.93M	266.61M
EBITDA	14.31M	32.94M	57.38M	64.28M	3.35M	76.36M
Net Income	7.38M	28.84M	-6.94M	-32.01M	-124.27M	-112.37M
Balance Sheet
Total Assets	131.23M	183.67M	255.80M	336.60M	536.01M	765.89M
Cash, Cash Equivalents and Short-Term Investments	62.49M	78.29M	95.80M	100.18M	147.50M	139.01M
Total Debt	40.37M	74.04M	175.97M	257.28M	402.99M	545.57M
Total Liabilities	107.02M	142.83M	243.93M	317.83M	485.23M	627.60M
Stockholders Equity	24.21M	40.84M	11.87M	18.77M	50.78M	138.30M
Cash Flow
Free Cash Flow	0.00	0.00	57.28M	34.76M	20.31M	21.20M
Operating Cash Flow	0.00	0.00	59.88M	37.96M	32.41M	64.91M
Investing Cash Flow	0.00	0.00	17.96M	-23.20M	-722.00K	-62.68M
Financing Cash Flow	0.00	0.00	-62.27M	-82.08M	-3.20M	-125.96M

Welife Technology Limited Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 0.05
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Neutral
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1703, the sentiment is Neutral. The current price of 0.05 is below the 20-day moving average (MA) of 0.05, above the 50-day MA of 0.05, and below the 200-day MA of 0.05, indicating a neutral trend. The MACD of >-0.01 indicates Neutral momentum. The RSI at 100.00 is Negative, 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 Neutral sentiment for HK:1703.

Welife Technology Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	57 Neutral	HK$25.99B	4.36	-4.73%	5.52%	-0.90%	-51.66%
1703	56 Neutral	HK$55.20M	4.44		―	―	―
8232	54 Neutral	HK$213.52M	―	-60.82%	―	-1.71%	39.00%
8412	50 Neutral	HK$39.73M	―	-202.81%	―	-55.08%	-316.18%
8428	48 Neutral	HK$76.14M	―	-392.91%	―	-23.17%	56.37%
3666	44 Neutral	HK$79.67M	―		―	-31.70%	-85.40%
8120	44 Neutral	HK$59.63M	―	-58.38%	―	-14.40%	25.64%

Welife Technology Limited Corporate Events

Welife Technology Announces Interim Results Corrections and Legal Settlements

Welife Technology Limited announced corrections to its unaudited interim results for the six months ended 30 September 2024, highlighting significant post-reporting period events. The company disclosed the disposal of its subsidiaries, Eternal Grand Group and Global Gourmet Group, to independent third parties, as well as ongoing litigations related to unpaid bonds and professional fees. A settlement was reached regarding a winding-up petition, resulting in a litigation loss of approximately HK$13,804,000 for the year ended 31 March 2024, and the petition was subsequently dismissed by the High Court of Hong Kong.

Welife Technology Faces Continued Trading Suspension Amid Compliance Review

Welife Technology Limited has received additional resumption guidance from the Hong Kong Stock Exchange, requiring an independent internal control review to ensure compliance with listing rules. Trading of the company’s shares remains suspended since November 2023, and will continue until the company addresses the issues and satisfies the Stock Exchange’s requirements.

Welife Technology Faces Winding-Up Petition Amidst Debt Dispute

Welife Technology Limited, incorporated in the Cayman Islands, is facing a winding-up petition filed by 杰晟思控股 （深圳） 有限公司 due to an alleged failure to repay debts amounting to RMB9,400,000. The petition is scheduled for a hearing on April 16, 2025, in the High Court of Hong Kong. The company’s assets and share transfers may be affected unless a court order states otherwise. Welife Technology has engaged legal counsel to protect its interests and considers the petition an abuse of process, with plans to potentially apply for its dismissal.

Welife Technology Limited Announces Board Composition and Roles

Welife Technology Limited has announced the composition of its board of directors and the roles within its board committees. The company has appointed executive, non-executive, and independent non-executive directors, with specific individuals assigned to the audit, nomination, and remuneration committees. This announcement provides clarity on the leadership structure, which may influence the company’s governance and strategic direction.

Welife Technology Seeks to Resume Trading Amidst Operational Continuity

Welife Technology Limited has submitted a resumption proposal to the Hong Kong Stock Exchange to resume trading of its shares, following a suspension. The company continues its restaurant operations and is working to fulfill the necessary conditions for resumption, including completing audits and addressing board composition issues.

Welife Technology Limited Corrects Board Meeting Date

Welife Technology Limited announced a correction to a previous announcement regarding the date of its board meeting. The meeting will take place on March 7, 2025, to approve various financial results and possibly recommend an interim dividend. This correction ensures stakeholders are accurately informed about the company’s financial reporting schedule.