Wecon Holdings Ltd. (1793) AI Stock Analysis

• Market Cap: HK$260.00M
• Dividend Yield: 5.63%
• Average Volume (3M): 78.00K
• Price to Earnings (P/E): 6.1
• Beta (1Y): <0.01
• Revenue Growth: -9.62%
• EPS Growth: -2.68%
• Country: HK
• Employees: 167
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): <0.01
• Shares Outstanding: 800,000,000
• 10 Day Avg. Volume: 44,800
• 30 Day Avg. Volume: 78,000
• PEG Ratio: 0.79
• Price to Book (P/B): 0.47
• Price to Sales (P/S): 0.12
• P/FCF Ratio: 10.26
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 52 Neutral
• Price Target: HK$0.33 ▲(49.09% Upside)
• Action: Reiterated Date: 01/24/26
• Date: Action: Reiterated 01/24/26

The score is primarily held back by weak financial performance—declining revenue, negative EBIT margin, and sharply lower free cash flow growth—despite a low-debt balance sheet. Technicals are supportive with strong momentum and the price above major moving averages, but the overbought RSI adds near-term risk. Valuation is mixed, with a relatively high P/E only partly offset by the dividend yield.

Positive Factors

Very low leverage

A debt-to-equity ratio of 0.017 indicates a highly conservative leverage profile, giving the company durable financial flexibility. Low leverage reduces default risk, supports investment or restructuring capacity, and preserves borrowing headroom during multi-quarter recoveries.

Positive EBITDA margin

A positive EBITDA margin despite an overall negative EBIT implies core operations generate cash before depreciation and amortization. This structural operational efficiency provides a base to restore operating profitability as revenue stabilizes, supporting long-term margin recovery.

Strong FCF-to-income conversion

A free cash flow to net income ratio of 0.89 shows earnings largely convert to cash, which is durable for funding capex, dividends or working capital needs. Even with volatile growth, high conversion supports solvency and the ability to reinvest without adding substantial leverage.

Negative Factors

Declining revenue

A 15.05% revenue decline erodes scale and magnifies fixed-cost drag, pressuring margins and ROE over multiple quarters. Sustained top-line contraction undermines long-term profitability potential and requires durable demand or contract wins to reverse the structural deterioration.

Negative EBIT margin

A negative EBIT margin signals operational losses before financing and taxes, indicating structural cost or pricing issues. Without sustained margin improvement, the company faces limited internal funds for investment, weaker competitiveness, and heightened sensitivity to sector downturns.

Sharp FCF decline and weak cash conversion

An 88.78% drop in free cash flow growth and an operating cash flow to net income ratio of 0.054 indicate materially weakened cash generation. This restricts reinvestment capacity, raises liquidity risk over several quarters, and forces reliance on balance sheet buffers despite low debt.

Wecon Holdings Ltd. Business Overview & Revenue Model

Company Description

Wecon Holdings Limited, an investment holding company, operates as a construction contractor in Hong Kong. It operates through two segments, Construction Contracts; and Repair, Maintenance, Alteration and Addition (RMAA) Works Services. The company provides building construction services for residential, commercial, and industrial buildings; and RMAA works services, such as general upkeep, maintenance, improvement, refurbishment, alteration, and addition of existing facilities and components of buildings and their surroundings. Wecon Holdings Limited was founded in 1974 and is headquartered in Central, Hong Kong.

How the Company Makes Money

Wecon Holdings Ltd. Financial Statement Overview

Summary

Weak operating and cash-flow trends offset balance-sheet strength. Revenue fell -15.05% and EBIT margin is negative, while free cash flow growth declined -88.78% and operating cash flow to net income is low (0.054). Positives include very low leverage (debt-to-equity 0.017) and a healthy equity base, but profitability is thin (net margin 0.70%, ROE 2.67%).

Income Statement

Wecon Holdings Ltd. has experienced a decline in revenue over the past year, with a negative revenue growth rate of -15.05%. The gross profit margin has also decreased slightly, indicating pressure on profitability. However, the company managed to maintain a positive net profit margin of 0.70%, showing some resilience in net income generation despite challenging conditions. The EBIT margin is negative, reflecting operational challenges, but the EBITDA margin remains positive, suggesting some level of operational efficiency.

Balance Sheet

The company's balance sheet shows a low debt-to-equity ratio of 0.017, indicating a conservative leverage position. Return on equity is modest at 2.67%, reflecting limited profitability relative to equity. The equity ratio is healthy, suggesting a strong capital structure with a significant portion of assets financed by equity.

Cash Flow

Cash flow analysis reveals a significant decline in free cash flow growth by -88.78%, indicating potential liquidity challenges. The operating cash flow to net income ratio is low at 0.054, suggesting limited cash generation from operations relative to net income. However, the free cash flow to net income ratio is relatively high at 0.89, indicating that a substantial portion of net income is converted into free cash flow.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	1.13B	1.06B	1.16B	869.03M	1.15B	1.10B
Gross Profit	43.67M	37.52M	45.10M	39.02M	53.65M	55.40M
EBITDA	13.36M	15.84M	14.47M	14.53M	17.72M	28.55M
Net Income	8.66M	7.39M	6.00M	5.95M	14.21M	19.24M
Balance Sheet
Total Assets	652.22M	537.33M	594.19M	454.72M	532.23M	498.32M
Cash, Cash Equivalents and Short-Term Investments	201.11M	106.28M	96.48M	77.96M	104.08M	143.20M
Total Debt	9.97M	4.60M	9.29M	6.72M	7.89M	4.66M
Total Liabilities	379.22M	261.13M	315.86M	172.88M	246.54M	217.31M
Stockholders Equity	273.00M	276.20M	278.33M	281.85M	285.69M	281.01M
Cash Flow
Free Cash Flow	-559.00K	12.68M	21.59M	-1.72M	-33.74M	34.31M
Operating Cash Flow	11.87M	14.17M	21.69M	-690.00K	-30.52M	38.49M
Investing Cash Flow	-15.85M	20.93M	7.58M	-13.45M	6.57M	-30.18M
Financing Cash Flow	-13.98M	-16.27M	-15.09M	-15.35M	-13.29M	-23.34M

Wecon Holdings Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.22
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1793, the sentiment is Positive. The current price of 0.22 is below the 20-day moving average (MA) of 0.32, below the 50-day MA of 0.29, and above the 200-day MA of 0.21, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 55.62 is Neutral, neither overbought nor oversold. The STOCH value of -33.33 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1793.

Wecon Holdings Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
1953	56 Neutral	HK$434.70M	-97.78	-1.01%	―	-29.24%	-40.35%
1793	52 Neutral	HK$260.00M	6.09	3.15%	5.63%	-9.62%	-2.68%
1920	43 Neutral	HK$393.12M	507.61	-104.46%	―	62.98%	67.20%

Wecon Holdings Ltd. Corporate Events

Wecon Holdings Faces HK$0.28-Per-Share Privatisation and Delisting Plan

Wecon Holdings Limited is the target of a proposed privatisation led by Triple Arch Limited, a British Virgin Islands–incorporated offeror, which plans to acquire all scheme shares and subsequently withdraw Wecon’s listing from the Hong Kong Stock Exchange. The structure involves cancelling existing scheme shares at HK$0.280 in cash per share and issuing an equivalent number of new fully paid shares to the offeror, effectively transferring full control while also cancelling shares held under the company’s award plan, with no dividends expected before the deal is implemented or lapses.

The proposal, launched on 26 February 2026 under a scheme of arrangement pursuant to Cayman Islands law, will proceed subject to customary conditions and approvals, including the scheme becoming effective and listing withdrawal being cleared. The move signals a strategic shift to take Wecon private, potentially reshaping its ownership and governance while removing public market scrutiny, and it will determine the exit value for minority shareholders whose shares are cancelled in exchange for cash.

The most recent analyst rating on (HK:1793) stock is a Hold with a HK$0.34 price target. To see the full list of analyst forecasts on Wecon Holdings Ltd. stock, see the HK:1793 Stock Forecast page.

Wecon Halts Trading Ahead of Takeovers Code Announcement

Wecon Holdings Limited has requested a halt in trading of its shares on the Stock Exchange of Hong Kong, effective from 9:00 a.m. on 27 February 2026. The company cited the pending release of an announcement related to the Code on Takeovers and Mergers, indicating that the forthcoming information qualifies as inside information.

The move signals that a potential corporate transaction or change of control may be under consideration, which could have material implications for shareholders and the company’s future strategic direction. Investors are likely to scrutinize the upcoming announcement for clarity on valuation, governance and possible shifts in ownership structure that may affect Wecon’s market positioning and regulatory obligations.

The most recent analyst rating on (HK:1793) stock is a Hold with a HK$0.33 price target. To see the full list of analyst forecasts on Wecon Holdings Ltd. stock, see the HK:1793 Stock Forecast page.