Diwang Industrial Holdings Limited (1950) AI Stock Analysis

• Market Cap: HK$116.64M
• Dividend Yield: N/A
• Average Volume (3M): 624.75K
• Price to Earnings (P/E): 4.6
• Beta (1Y): 0.05
• Revenue Growth: -12.19%
• EPS Growth: 108.93%
• Country: HK
• Employees: 217
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 0.02
• Shares Outstanding: 720,000,000
• 10 Day Avg. Volume: 150,400
• 30 Day Avg. Volume: 624,746
• PEG Ratio: 2.13
• Price to Book (P/B): 0.14
• Price to Sales (P/S): 0.16
• P/FCF Ratio: -2.73
• 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: 60 Neutral
• Price Target: HK$0.21 ▼(-10.00% Downside)

The overall stock score of 60 reflects a mixed outlook. The strong balance sheet and attractive valuation are offset by weak cash flow performance and bearish technical indicators. The absence of earnings call data and corporate events limits further insights.

Positive Factors

Strong Balance Sheet

A robust balance sheet with a high equity ratio indicates financial stability and prudent leverage management, supporting long-term growth potential.

Improved Profitability

The shift to a positive net profit margin reflects enhanced operational efficiency and cost management, contributing to sustainable profitability.

Strong Gross Profit Margins

High gross profit margins indicate effective cost control and pricing power, which are critical for maintaining competitive advantage and profitability.

Negative Factors

Inconsistent Revenue Growth

Fluctuating revenue growth suggests potential market challenges and may impact the company's ability to scale and sustain long-term growth.

Weak Cash Flow Performance

Weak cash flow performance indicates challenges in funding operations and capital expenditures, potentially leading to increased reliance on external financing.

Rising Debt Levels

Increasing debt levels could strain financial resources and limit the company's ability to invest in growth opportunities, affecting long-term financial health.

Diwang Industrial Holdings Limited Business Overview & Revenue Model

Company Description

Diwang Industrial Holdings Limited (1950) is a Hong Kong-based investment holding company primarily engaged in the manufacturing and trading of various industrial products. The company operates through multiple sectors, including electrical and electronic components, machinery, and consumer goods. Diwang focuses on providing quality products and services to a diverse clientele, leveraging its expertise in manufacturing and supply chain management to meet market demands.

How the Company Makes Money

Diwang Industrial Holdings Limited generates revenue through the sale of its manufactured products across different sectors. Key revenue streams include the production of electrical components, machinery, and consumer goods that are distributed both domestically and internationally. The company benefits from established partnerships with suppliers and distributors, which enhance its market reach and operational efficiency. Additionally, Diwang may engage in contract manufacturing services, providing tailored production solutions for clients, further diversifying its income sources. Fluctuations in demand for industrial products and the company's ability to innovate and adapt to market trends are significant factors influencing its earnings.

Diwang Industrial Holdings Limited Financial Statement Overview

Summary

Diwang Industrial Holdings Limited shows a mixed financial performance. The balance sheet is strong with a robust capital structure, but the income statement indicates irregular growth and profitability trends. The cash flow performance raises concerns due to persistent negative flows, suggesting potential liquidity constraints.

Income Statement

The company exhibits a mixed income statement performance. It has shown strong gross profit margins, consistently above 40% in recent years, indicating effective cost management. The net profit margin improved from negative in 2020 to positive in 2024, reflecting significant recovery. However, revenue growth has been inconsistent, with a decline noted in 2024, suggesting potential market challenges. Additionally, EBIT and EBITDA margins have fluctuated, indicating some volatility in operating performance.

Balance Sheet

The company's balance sheet is strong, with a healthy equity ratio of approximately 77% in 2024, pointing to a robust capital structure. The debt-to-equity ratio remains low, demonstrating prudent leverage management. Return on equity improved to 4.66% in 2024, showcasing better profitability on shareholders' investments. However, there is a noticeable increase in total debt in 2024, which may need monitoring.

Cash Flow

The cash flow statement reveals considerable weaknesses, with negative free cash flow growth and operating cash flow over the past years. This indicates challenges in generating sufficient cash from operations to cover capital expenditures and suggests reliance on external financing. The absence of operating cash flow in 2024 further highlights potential liquidity issues. The free cash flow to net income ratio is unfavorable, underlining inefficiencies in translating profits into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	537.53M	566.48M	570.57M	501.44M	233.94M	134.44M
Gross Profit	243.71M	257.30M	233.38M	193.70M	38.88M	31.60M
EBITDA	37.98M	44.27M	46.54M	90.38M	12.93M	12.07M
Net Income	23.40M	30.03M	19.45M	21.85M	-2.60M	-3.16M
Balance Sheet
Total Assets	923.48M	827.68M	737.59M	446.38M	313.17M	264.01M
Cash, Cash Equivalents and Short-Term Investments	82.31M	60.70M	58.47M	57.82M	64.71M	79.64M
Total Debt	114.06M	64.96M	25.00M	10.00M	0.00	0.00
Total Liabilities	218.13M	158.94M	99.00M	96.00M	43.59M	26.66M
Stockholders Equity	654.96M	644.09M	613.92M	331.14M	269.58M	237.35M
Cash Flow
Free Cash Flow	-32.17M	-34.13M	-273.61M	-42.09M	-32.23M	-14.38M
Operating Cash Flow	27.37M	58.98M	-216.32M	-14.50M	-2.06M	5.78M
Investing Cash Flow	-51.68M	-90.18M	-61.43M	-14.85M	-87.68M	-16.34M
Financing Cash Flow	57.76M	37.11M	278.90M	48.47M	38.96M	76.80M

Diwang Industrial Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.23
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1950, the sentiment is Negative. The current price of 0.23 is above the 20-day moving average (MA) of 0.20, above the 50-day MA of 0.21, and above the 200-day MA of 0.21, indicating a bearish trend. The MACD of -0.01 indicates Positive momentum. The RSI at 24.74 is Positive, neither overbought nor oversold. The STOCH value of 42.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:1950.

Diwang Industrial Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2116	68 Neutral	HK$244.80M	13.42	7.30%	1.96%	29.04%	-1.55%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
1950	60 Neutral	HK$116.64M	4.62	3.61%	―	-12.19%	108.93%
0301	56 Neutral	HK$630.42M	-18.13	-14.53%	―	0.35%	-153.95%
1047	54 Neutral	HK$147.68M	444.44	0.07%	―	5.65%	―
0701	49 Neutral	HK$375.03M	-3.73	-8.05%	―	-24.13%	-27.54%
1932	48 Neutral	HK$130.00M	-2.09	-15.93%	―	-25.21%	12.04%

Diwang Industrial Holdings Limited Corporate Events

Diwang Industrial Holdings Delays Circular Dispatch for Major Transaction

Diwang Industrial Holdings Limited has announced a delay in the dispatch of a circular related to a major transaction involving the sale of a 24% interest in one of its subsidiaries. Initially expected by December 2, 2025, the circular will now be dispatched by December 31, 2025, due to the need for additional preparation time. This delay may impact shareholders’ timelines for reviewing transaction details and participating in the associated Extraordinary General Meeting.

Diwang Industrial Holdings Announces Major Transaction with Second Disposal of Subsidiary Interest

Diwang Industrial Holdings Limited has entered into a Second Sale and Purchase Agreement to sell a 24% interest in a subsidiary to an independent third party for RMB29,860,000. This transaction, combined with a previous sale, constitutes a major transaction under Hong Kong’s Listing Rules, requiring shareholder approval. The company will retain control of the subsidiary, and the financial results will continue to be consolidated with the group’s results.

Diwang Industrial Holdings Releases Supplemental Announcement on Annual Report

Diwang Industrial Holdings Limited has issued a supplemental announcement to its annual report for the year ended December 31, 2024, providing additional details on its continuing connected transactions and share option scheme. The independent non-executive directors have confirmed that these transactions were conducted in the ordinary course of business, on normal commercial terms, and in the interests of shareholders. The company’s auditor has also reviewed these transactions and found no issues. Additionally, the share option scheme remains unchanged, with 20 million shares available for grant as of the end of 2023 and 2024.