Ausnutria Dairy Corp. Ltd. (1717) AI Stock Analysis

• Market Cap: HK$3.75B
• Dividend Yield: 2.83%
• Average Volume (3M): 187.34K
• Price to Earnings (P/E): 12.8
• Beta (1Y): 0.60
• Revenue Growth: 0.52%
• EPS Growth: 99.51%
• Country: HK
• Employees: 3,288
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Packaged Foods
• EPS (TTM): 0.11
• Shares Outstanding: 1,778,144,900
• 10 Day Avg. Volume: 165,000
• 30 Day Avg. Volume: 187,345
• PEG Ratio: 0.39
• Price to Book (P/B): 0.55
• Price to Sales (P/S): 0.42
• P/FCF Ratio: -36.22
• 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: HK$3.10
• Price Target Upside: 48.33% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 59 Neutral
• Price Target: HK$2.00 ▼(-4.31% Downside)

The overall stock score is primarily influenced by the company's stable financial position and reasonable valuation. However, bearish technical indicators and challenges in cash flow management weigh down the score. The lack of growth initiatives and liquidity concerns are significant risks.

Positive Factors

Strong Equity Position

A conservative leverage ratio indicates financial stability, providing the company with flexibility to invest in growth opportunities without excessive debt burden.

Improved Profitability Margins

Improved profitability margins suggest effective cost management and operational efficiency, enhancing the company's ability to generate profits from its operations.

Global Market Presence

A strong global market presence diversifies revenue streams and reduces dependency on any single market, providing resilience against regional economic fluctuations.

Negative Factors

Stagnant Revenue Growth

Stagnant revenue growth suggests potential challenges in market expansion or product demand, necessitating strategic initiatives to drive future growth.

Negative Free Cash Flow

Negative free cash flow indicates that capital expenditures are not being matched by operational inflows, potentially affecting long-term cash sustainability and investment capacity.

Low Operational Efficiency

Low operational efficiency margins suggest that the company may need to optimize its operations to improve profitability and competitiveness in the market.

Ausnutria Dairy Corp. Ltd. Business Overview & Revenue Model

Company Description

Ausnutria Dairy Corporation Ltd, an investment holding company, primarily engages in the research and development, milk collection, processing, production, packaging, marketing, and distribution of infant formula and other dairy products. The company operates in two segments, Dairy and Related Products, and Nutrition Products. It offers cow milk-based formula products under the Allnutria, Hyproca Hollary, Hyproca Hypure, Neolac, and Puredo brand names; and goat milk-based infant formula products under the Kabrita brand. The company also produces formula milk powder products on an original equipment manufacturing basis. In addition, it engages in the manufacturing and distribution of nutrition products; development, distribution, and sale of probiotic products; and provision of financing services. The company operates in the People's Republic of China, the European Union, Southeast Asia, Australia, New Zealand, the Middle East, North and South America, and internationally. The company was founded in 2003 and is based in Sheung Wan, Hong Kong. Ausnutria Dairy Corporation Ltd operates as a subsidiary of HongKong Jingang Trade Holding Company Limited.

How the Company Makes Money

Ausnutria Dairy Corp. Ltd. generates revenue primarily through the sale of its dairy products, with a significant focus on infant formula, which is a highly profitable segment in the dairy industry. The company employs a multi-channel distribution strategy, supplying products through both online and offline retail platforms. Key revenue streams include sales from domestic markets and exports to international markets, particularly in regions with high demand for premium dairy products. Ausnutria also benefits from strategic partnerships with various retailers and distributors, which enhance its market reach. Additionally, the company invests in brand development and marketing to strengthen its market presence and drive consumer loyalty, ultimately contributing to its earnings.

Ausnutria Dairy Corp. Ltd. Financial Statement Overview

Summary

The company has a stable financial position with strong equity and improved profitability margins. However, challenges in cash flow management and stagnant revenue growth indicate a need for strategic initiatives to enhance operational efficiency and liquidity.

Income Statement

The company has shown consistent revenue generation with a slight increase in 2024 compared to previous years. Gross Profit Margin remained strong at 41.98% in 2024, reflecting a good cost management strategy. Net Profit Margin improved to 3.19% in 2024 from 2.36% in 2023, indicating enhanced profitability. However, EBIT Margin and EBITDA Margin are relatively low at 5.16% and 8.71% respectively, suggesting operational efficiency could be improved. The revenue growth has been stagnant, indicating a need for strategic growth initiatives.

Balance Sheet

The balance sheet shows a stable position with a Debt-to-Equity Ratio of 0.39, suggesting conservative leverage. Return on Equity (ROE) is relatively low at 4.12% in 2024, indicating modest returns to shareholders. The Equity Ratio remains strong at 59.23%, highlighting a solid capital structure with a significant proportion of assets financed by equity. The company has maintained a healthy cash reserve, although there is a slight decline in cash and cash equivalents over the years, which might restrict liquidity.

Cash Flow

The cash flow position is mixed, with Operating Cash Flow to Net Income Ratio of 1.27 in 2024, indicating good cash conversion. However, Free Cash Flow has been negative, reflecting high capital expenditures that have not been matched by operational inflows, potentially affecting long-term cash sustainability. The Free Cash Flow to Net Income Ratio is negative, signaling concerns over cash efficiency and capital expenditure management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.66B	7.40B	7.38B	7.80B	8.58B	7.99B
Gross Profit	2.32B	3.11B	2.85B	3.39B	4.15B	3.98B
EBITDA	513.11M	645.26M	503.39M	529.50M	1.26B	1.50B
Net Income	180.81M	235.97M	174.39M	216.53M	763.79M	1.00B
Balance Sheet
Total Assets	10.50B	9.66B	10.03B	9.80B	9.51B	9.25B
Cash, Cash Equivalents and Short-Term Investments	1.01B	1.42B	2.04B	1.87B	2.26B	1.86B
Total Debt	2.73B	2.25B	2.42B	1.56B	1.30B	1.09B
Total Liabilities	4.31B	3.88B	4.28B	4.23B	4.02B	4.10B
Stockholders Equity	6.13B	5.72B	5.69B	5.65B	5.54B	5.17B
Cash Flow
Free Cash Flow	-168.74M	-86.32M	-459.31M	-1.06B	514.93M	623.59M
Operating Cash Flow	92.45M	299.37M	224.71M	-357.54M	1.07B	1.13B
Investing Cash Flow	-770.46M	-899.16M	-740.92M	-723.98M	-606.57M	-402.58M
Financing Cash Flow	-325.59M	-273.59M	682.45M	664.11M	-34.09M	-494.87M

Ausnutria Dairy Corp. Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.09
• 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:1717, the sentiment is Negative. The current price of 2.09 is below the 20-day moving average (MA) of 2.17, below the 50-day MA of 2.22, and below the 200-day MA of 2.20, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 39.31 is Neutral, neither overbought nor oversold. The STOCH value of 13.19 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:1717.

Ausnutria Dairy Corp. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0151	67 Neutral	HK$57.01B	12.60	24.70%	3.34%	2.03%	1.43%
9985	66 Neutral	HK$25.92B	19.48	18.11%	4.83%	23.90%	10.72%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
1717	59 Neutral	HK$3.75B	12.85	4.53%	2.83%	0.52%	99.51%
0345	58 Neutral	HK$6.70B	28.91	7.63%	2.21%	-3.39%	91.63%
2319	56 Neutral	HK$58.71B	-180.14	-0.74%	3.65%	-7.36%	-107.25%
6186	55 Neutral	HK$36.50B	12.54	10.48%	6.98%	-0.64%	-24.62%

Ausnutria Dairy Corp. Ltd. Corporate Events

Ausnutria Dairy Clarifies Probiotics Supply Agreement Caps

Ausnutria Dairy Corporation Ltd announced a clarification regarding its Probiotics Supply Framework Agreement, specifying the annual transaction caps for the financial years ending in 2025, 2026, and 2027. The caps are set at RMB10 million, RMB40 million, and RMB65 million, respectively, indicating a significant increase over the period, which may impact the company’s market positioning and operations.

Ausnutria Dairy Signs Probiotics Supply Agreement with Yili Industrial

Ausnutria Dairy Corporation Ltd. has entered into a Probiotics Supply Framework Agreement with Yili Industrial, a controlling shareholder, to supply probiotics and related products until December 2027. This agreement, classified as a continuing connected transaction under Hong Kong’s Listing Rules, does not require independent shareholders’ approval but is subject to reporting and annual review requirements, indicating a strategic partnership that could enhance Ausnutria’s market positioning and operational scope.