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China Zhengtong Auto Services Holdings Limited (HK:1728)
:1728

China Zhengtong Auto Services Holdings (1728) AI Stock Analysis

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HK

China Zhengtong Auto Services Holdings

(OTC:1728)

Rating:52Neutral
Price Target:
HK$0.00
▼(-100.00%Downside)
The overall stock score reflects significant financial challenges as the most impactful factor, with a weak financial performance heavily weighing down the score. While technical indicators suggest a positive price trend, the overbought RSI and negative valuation metrics temper enthusiasm.

China Zhengtong Auto Services Holdings (1728) vs. iShares MSCI Hong Kong ETF (EWH)

China Zhengtong Auto Services Holdings Business Overview & Revenue Model

Company DescriptionChina Zhengtong Auto Services Holdings Limited (1728) is a leading integrated automotive dealership group in China, focusing on premium and ultra-premium brands. The company operates through various segments, including automotive dealership, repair and maintenance services, pre-owned vehicle sales, and value-added services. Its portfolio features a wide range of luxury brands, and it offers an extensive selection of new and used vehicles, comprehensive maintenance solutions, and high-quality customer service.
How the Company Makes MoneyChina Zhengtong Auto Services Holdings makes money primarily through the sale of new and used vehicles, which constitutes the largest portion of its revenue. The company holds authorized dealership rights for premium and ultra-premium automotive brands, allowing it to capture significant market share in China's luxury vehicle segment. In addition to vehicle sales, the company generates revenue from after-sales services, including repair, maintenance, and the sale of automotive parts. Zhengtong also earns from offering value-added services such as insurance, financing, and extended warranty packages. Furthermore, strategic partnerships with automotive manufacturers and financial institutions enhance its service offerings and revenue potential.

China Zhengtong Auto Services Holdings Financial Statement Overview

Summary
The company's financial health is weak with declining revenues, persistent losses, negative equity, and poor cash flow generation. High leverage and inability to generate positive returns pose substantial risks.
Income Statement
20
Very Negative
The income statement reflects a challenging period with declining revenues and profitability. Total revenue dropped significantly over the years, particularly from 2019 to 2024. The gross profit margin has decreased considerably, and the company has been experiencing negative net profit margins in recent years, indicating ongoing losses. Additionally, EBIT and EBITDA margins have been negative, reflecting operational inefficiencies and financial struggles.
Balance Sheet
15
Very Negative
The balance sheet shows high leverage with a negative stockholders' equity in 2024, indicating insolvency risks. The debt-to-equity ratio is unfavorable due to negative equity, and equity ratio is negative, showing the company is highly leveraged. Return on equity has been negative, further reflecting financial distress and inability to generate shareholder value.
Cash Flow
10
Very Negative
The cash flow situation is concerning with negative free cash flows over the years, highlighting liquidity issues. Operating cash flow has been inconsistent and low relative to net income, indicating poor cash conversion. Free cash flow to net income ratio is not meaningful due to persistent losses, raising concerns about sustainability.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue20.75B24.13B22.61B20.99B16.88B
Gross Profit779.07M1.01B1.59B1.24B-5.17B
EBITDA-6.29M982.32M900.12M-178.45M-8.37B
Net Income-1.60B-849.28M-297.42M-2.20B-8.61B
Balance Sheet
Total Assets29.22B29.51B27.73B26.13B28.00B
Cash, Cash Equivalents and Short-Term Investments631.09M871.20M837.65M745.20M1.09B
Total Debt21.31B21.04B20.02B18.14B14.66B
Total Liabilities28.15B28.23B27.51B25.59B22.68B
Stockholders Equity-356.68M361.83M193.39M508.43M4.11B
Cash Flow
Free Cash Flow-347.73M-1.09B-712.02M-486.33M-239.67M
Operating Cash Flow31.09M36.79M158.79M155.63M346.23M
Investing Cash Flow202.72M-793.48M1.30B-345.83M22.41M
Financing Cash Flow-406.15M767.08M-936.38M-90.45M-1.36B

China Zhengtong Auto Services Holdings Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price0.14
Price Trends
50DMA
0.13
Positive
100DMA
0.12
Positive
200DMA
0.12
Positive
Market Momentum
MACD
<0.01
Positive
RSI
52.42
Neutral
STOCH
27.27
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1728, the sentiment is Neutral. The current price of 0.14 is below the 20-day moving average (MA) of 0.15, above the 50-day MA of 0.13, and above the 200-day MA of 0.12, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 52.42 is Neutral, neither overbought nor oversold. The STOCH value of 27.27 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HK:1728.

China Zhengtong Auto Services Holdings Peers Comparison

Overall Rating
UnderperformOutperform
Sector (56)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
67
Neutral
HK$28.34B8.116.95%5.71%-7.86%-36.99%
56
Neutral
HK$24.58B3.79-2.03%6.58%-0.32%-67.68%
54
Neutral
HK$3.94B18.421.44%7.17%-14.25%-65.33%
52
Neutral
$1.43B
-15.73%-73.42%
47
Neutral
€951.13M-5.36%5.69%-7.58%-21.25%
46
Neutral
HK$174.00M-9.04%-23.03%-1842.08%
46
Neutral
HK$2.83B40.67-56.58%2.32%-23.89%-1698.95%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:1728
China Zhengtong Auto Services Holdings
0.14
-0.06
-28.50%
HK:0881
Zhongsheng Group Holdings Ltd.
11.84
0.65
5.81%
HK:1771
Sunfonda Group Holdings Ltd.
0.29
-0.30
-50.85%
HK:3669
China Yongda Automobiles Services
2.18
0.69
46.41%
HK:1268
China MeiDong Auto Holdings
2.09
0.11
5.72%
HK:3836
China Harmony Auto Holding Limited
0.65
0.19
39.78%

China Zhengtong Auto Services Holdings Corporate Events

China Zhengtong Auto Services Concludes Share Acquisition Offer by Xinda Motors
Jun 30, 2025

China Zhengtong Auto Services Holdings Limited announced the conclusion of an unconditional mandatory cash offer by Xinda Motors Co., Limited to acquire all issued shares not already owned by Xinda Motors. The offer closed with valid acceptances for approximately 15.71% of the company’s total issued share capital, resulting in a cash consideration of HK$235,976,779.20. Following the offer, Xinda Motors and its concert parties now hold approximately 75% of the company’s shares, significantly altering the shareholding structure and potentially impacting the company’s market positioning and stakeholder interests.

China Zhengtong Auto Services Secures Strong Shareholder Support at AGM
Jun 19, 2025

China Zhengtong Auto Services Holdings Limited announced the successful passing of all resolutions at its Annual General Meeting held on June 19, 2025. The resolutions included the re-election of directors, authorization of director remuneration, reappointment of auditors, and granting of mandates related to share repurchase and issuance. This outcome reflects strong shareholder support and positions the company for continued operational stability and strategic flexibility in the automotive services market.

China Zhengtong Announces Unconditional Cash Offer by Xinda Motors
Jun 8, 2025

China Zhengtong Auto Services Holdings Limited has announced the dispatch of a composite document detailing an unconditional mandatory cash offer by CLSA Limited on behalf of Xinda Motors Co., Limited to acquire all issued shares not already owned by Xinda Motors. This move is expected to impact the company’s shareholding structure and may influence its market positioning, with further announcements anticipated if there are changes to the offer’s timetable.

China Zhengtong Auto Services Completes Major Share Subscription with Xinda Motors
Jun 2, 2025

China Zhengtong Auto Services Holdings Limited has completed a significant transaction with Xinda Motors Co., Limited, involving a connected subscription that increased Xinda Motors’ shareholding to approximately 75% of the company. This move, which involved the issuance of over 6.6 billion new shares, marks a substantial shift in the company’s ownership structure and could have implications for its market positioning and stakeholder interests.

China Zhengtong Auto Services Announces Key Developments in Shareholding Structure
May 28, 2025

China Zhengtong Auto Services Holdings Limited announced that Xinda Motors Co., Limited has waived a condition precedent related to a Whitewash Waiver under their Subscription Agreement, allowing the Connected Subscription Completion to proceed. This development will result in Xinda Motors and its concert parties increasing their shareholding to a maximum of 75% of the company’s shares. Consequently, a mandatory general offer for all remaining shares will be made, impacting the company’s ownership structure significantly.

China Zhengtong Auto Services Announces 2025 AGM Details
May 27, 2025

China Zhengtong Auto Services Holdings Limited has announced the details of its 2025 Annual General Meeting, scheduled for June 19, 2025, in Wuhan, Hubei Province. Key agenda items include the review of the company’s financial statements for 2024, re-election of directors, and authorization for the board to fix directors’ remuneration. Additionally, the company seeks approval for a mandate allowing the purchase of up to 10% of its own shares, which could impact its market positioning and shareholder value.

China Zhengtong Auto Services Faces Potential Acquisition by Xinda Motors
May 23, 2025

China Zhengtong Auto Services Holdings Limited has announced a potential unconditional mandatory cash offer by Xinda Motors Co., Limited to acquire all issued shares not already owned by Xinda Motors. The completion of this connected subscription is contingent upon fulfilling or waiving certain conditions, including regulatory approvals and the Whitewash Waiver. The outcome of these conditions will determine whether the subscription proceeds, impacting the company’s market positioning and shareholder interests.

China Zhengtong Auto Announces CEO Resignation
Apr 29, 2025

China Zhengtong Auto Services Holdings Limited has announced the resignation of its Chief Executive Officer, Mr. Chen Hong, effective April 29, 2025, due to changes in work arrangements. Mr. Chen will remain an executive director and a member of the environmental, social, and governance committee. In the interim, Mr. Luo Yaohuang, an executive vice president with over 20 years of experience in the industry, will assume the CEO responsibilities. The company will seek a permanent replacement in due course.

China Zhengtong Auto Services Announces Board Composition
Apr 29, 2025

China Zhengtong Auto Services Holdings Limited has announced the composition of its board of directors, highlighting the roles and functions of each member. This announcement provides transparency in corporate governance and may impact stakeholder confidence by clarifying the leadership structure and committee responsibilities.

China Zhengtong Auto Services Unanimously Approves EGM Resolutions
Apr 23, 2025

China Zhengtong Auto Services Holdings Limited announced the results of its Extraordinary General Meeting held on April 23, 2025. All proposed resolutions, including the re-election of directors and amendments to the articles of association, were unanimously approved by shareholders. This unanimous approval reflects strong shareholder support for the company’s leadership and strategic direction, potentially strengthening its governance and operational framework.

China Zhengtong Auto Services Announces EGM Results and Potential Acquisition
Apr 23, 2025

China Zhengtong Auto Services Holdings Limited held an Extraordinary General Meeting (EGM) on April 23, 2025, where key resolutions were passed, including the grant of a whitewash waiver. This waiver facilitates a possible unconditional mandatory cash offer by CLSA Limited on behalf of Xinda Motors to acquire all issued shares of China Zhengtong Auto Services, excluding those already owned by Xinda Motors. The announcement indicates significant corporate restructuring and potential changes in ownership, which could impact the company’s market positioning and stakeholder interests.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: May 30, 2025