VCREDIT Holdings Limited (2003) AI Stock Analysis

• Market Cap: HK$1.05B
• Dividend Yield: 9.77%
• Average Volume (3M): 112.03K
• Price to Earnings (P/E): 1.7
• Beta (1Y): 0.09
• Revenue Growth: 16.56%
• EPS Growth: 110.71%
• Country: HK
• Employees: 870
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 0.48
• Shares Outstanding: 489,459,780
• 10 Day Avg. Volume: 67,879
• 30 Day Avg. Volume: 112,026
• PEG Ratio: 0.35
• Price to Book (P/B): 0.20
• Price to Sales (P/S): 0.33
• P/FCF Ratio: 0.63
• 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: 58 Neutral
• Price Target: HK$2.00 ▼(-21.26% Downside)

The score is driven primarily by improving but still inconsistent financial performance (stronger 2024 growth, materially lower leverage, but volatile cash flow), offset by weak technical momentum and downtrend signals. Valuation is a major positive due to the very low P/E and high dividend yield.

Positive Factors

Improved capital structure

A materially lower debt-to-equity ratio meaningfully reduces balance-sheet risk and interest burden, improving financial flexibility. This strengthens the company’s ability to withstand credit cycles, support lending capacity and pursue strategic initiatives over the next several quarters.

Revenue and margin recovery

Re-acceleration of top-line growth alongside a healthy net margin indicates the core digital consumer-credit business is regaining traction. Sustained revenue expansion with solid margins supports operating leverage, cash generation and longer-term viability of the online lending model.

Strong free cash flow in 2024

Free cash flow nearly matched net income in 2024, signaling improved earnings quality and real cash conversion. Reliable FCF enables deleveraging, dividends or reinvestment and is a durable indicator of the firm’s ability to fund operations without aggressive external financing.

Negative Factors

Volatile cash generation

Pronounced swings in operating and free cash flow make cash availability unpredictable, raising refinancing and liquidity risk during downturns. This volatility complicates capital allocation, dividend predictability and undermines confidence in sustainable internal funding sources.

Uneven historical performance

A history of sharp downturns and inconsistent revenue trends reduces visibility into sustainable growth rates and makes forecasting tougher. Structural instability in demand or credit cycles implies management must continually manage credit risk and re-price products to stabilize earnings.

Lower returns versus prior peak

Moderate ROE well below prior peak suggests reduced earnings power or increased competition. Persistently lower returns constrain the firm’s ability to generate excess shareholder value and may limit capacity to sustain high dividends or fund growth without raising new capital.

VCREDIT Holdings Limited Business Overview & Revenue Model

Company Description

VCREDIT Holdings Limited, an investment holding company, provides consumer finance services to prime and near-prime borrowers in China. The company offers credit cards balance transfer and consumption credit products. It also provides loan facilitation, guarantee, micro credit, and financial leasing services, as well as technology services. The company was formerly known as Vision Capital Group Limited and changed its name to VCREDIT Holdings Limited. VCREDIT Holdings Limited was founded in 2006 and is headquartered in Admiralty, Hong Kong.

How the Company Makes Money

VCREDIT Holdings Limited generates revenue primarily through the interest and fees charged on its consumer finance products. The company offers credit card balance transfer services, where it earns interest from the outstanding balances transferred to their platform. Additionally, VCREDIT provides online consumption credit products, where it collects service fees and interest. The company employs sophisticated data analytics and risk management tools to minimize defaults and ensure a steady revenue stream. Strategic partnerships with financial institutions and technology companies also play a crucial role in expanding its customer base and enhancing its service offerings, contributing to its overall earnings.

VCREDIT Holdings Limited Financial Statement Overview

Summary

Financial results are improving but remain uneven. Revenue growth re-accelerated in 2024 (+16.8%) and profitability is positive (net margin ~17.5%). Balance-sheet risk has improved meaningfully with much lower leverage (debt-to-equity ~0.49 in 2024 vs. ~1.35 in 2023). The main drawback is volatility across cycles—especially cash flow (negative in 2021 and 2023) despite a strong 2024 rebound—suggesting inconsistent cash conversion and earnings power below prior peak years.

Income Statement

Revenue growth re-accelerated in 2024 (+16.8% vs. +1.3% in 2023), but longer-term performance is uneven with a sharp downturn in 2020 (negative revenue and losses). Profitability in recent years is positive (2024 net margin ~17.5%, up from ~16.0% in 2023), yet still well below the very strong margins seen in 2021–2022, pointing to a lower earnings power versus prior peak levels.

Balance Sheet

Leverage has improved materially: debt-to-equity fell to ~0.49 in 2024 from ~1.35 in 2023 (and ~2.07 in 2021), suggesting a healthier capital structure and reduced balance-sheet risk. Returns on equity are moderate and stable recently (~10–11% in 2023–2024) but down significantly from 2021’s elevated level, indicating the balance sheet is stronger, though not currently translating into outsized shareholder returns.

Cash Flow

Cash generation is volatile. 2024 operating and free cash flow rebounded strongly (operating cash flow ~HK$1.46B; free cash flow ~HK$1.42B), and free cash flow roughly matches net income (~0.97x), which supports earnings quality. However, the business has shown large swings (negative operating/free cash flow in 2021 and 2023), and 2024’s free-cash-flow growth is sharply negative, highlighting unpredictability in cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.45B	2.73B	2.84B	1.77B	2.98B	-96.09M
Gross Profit	3.45B	2.73B	1.47B	1.24B	1.97B	-96.09M
EBITDA	0.00	0.00	0.00	748.90M	1.56B	0.00
Net Income	573.81M	478.17M	453.91M	532.47M	1.18B	-869.56M
Balance Sheet
Total Assets	14.51B	11.71B	11.93B	10.10B	11.28B	8.34B
Cash, Cash Equivalents and Short-Term Investments	0.00	1.69B	1.64B	2.13B	2.45B	2.00B
Total Debt	4.46B	2.27B	5.62B	4.54B	7.01B	4.77B
Total Liabilities	9.75B	7.10B	7.77B	6.28B	7.88B	6.05B
Stockholders Equity	4.75B	4.61B	4.17B	3.82B	3.39B	2.28B
Cash Flow
Free Cash Flow	-1.05B	1.42B	-1.37B	3.01B	-1.04B	5.24B
Operating Cash Flow	-1.01B	1.46B	-1.34B	3.04B	-1.02B	5.27B
Investing Cash Flow	9.56M	45.83M	70.36M	-176.11M	-122.74M	-27.36M
Financing Cash Flow	1.23B	-714.17M	580.52M	-3.18B	1.55B	-5.91B

VCREDIT Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.54
• 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:2003, the sentiment is Negative. The current price of 2.54 is above the 20-day moving average (MA) of 2.38, above the 50-day MA of 2.53, and below the 200-day MA of 3.22, indicating a bearish trend. The MACD of -0.10 indicates Positive momentum. The RSI at 32.62 is Neutral, neither overbought nor oversold. The STOCH value of 15.08 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:2003.

VCREDIT Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1577	80 Outperform	HK$680.00M	6.20	8.46%	5.46%	-24.04%	60.24%
0900	71 Outperform	HK$3.12B	6.53	10.90%	6.92%	4.78%	24.02%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
1601	64 Neutral	HK$1.37B	3.78	9.89%	7.43%	1.11%	3.98%
6866	64 Neutral	HK$430.70M	7.13	2.75%	4.88%	-12.94%	-15.93%
2003	58 Neutral	HK$1.05B	1.70	12.71%	9.77%	16.56%	110.71%
3848	49 Neutral	HK$1.75B	215.16	1.28%	0.27%	-7.88%	-28.43%

VCREDIT Holdings Limited Corporate Events

VCREDIT Holdings Updates on Share Option and Award Schemes

VCREDIT Holdings Limited announced supplemental information to its 2024 Annual Report, detailing the status of its Post-IPO Share Option Scheme and Share Award Schemes. No new share options were granted under the Post-IPO Share Option Scheme, with a significant portion of shares still available for future grants. The Share Award Scheme No. 1 saw some shares vesting during the year, while Share Award Scheme No. 2 had no awards granted, leaving a substantial number of shares available for future awards. These developments indicate the company’s ongoing efforts to manage its equity compensation plans effectively, which could impact employee retention and shareholder value.