Petro-king Oilfield Services Ltd. (2178) AI Stock Analysis

• Market Cap: HK$117.41M
• Dividend Yield: N/A
• Average Volume (3M): 666.29K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.16
• Revenue Growth: -36.59%
• EPS Growth: 48.63%
• Country: HK
• Employees: 195
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): >-0.01
• Shares Outstanding: 1,726,674,700
• 10 Day Avg. Volume: 441,100
• 30 Day Avg. Volume: 666,290
• PEG Ratio: 0.07
• Price to Book (P/B): 0.58
• Price to Sales (P/S): 0.34
• P/FCF Ratio: 8.70
• 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: 59 Neutral
• Price Target: HK$0.07 ▲(36.00% Upside)

The score is primarily held back by weak financial profitability (negative net margin and ROE) despite improving margins and a return to positive free cash flow. Technicals are supportive, with price above major moving averages and positive MACD, but valuation remains a concern due to the negative P/E and lack of dividend yield data.

Positive Factors

Positive free cash flow

Sustained positive free cash flow improves funding flexibility for capital expenditures, debt servicing, and working capital. Over months this reduces refinancing risk, supports reinvestment in high-return services and underpins operational stability during oilfield services cycles.

Sharply improved gross margin

A large and persistent gross margin improvement signals stronger pricing power, better cost control or higher-margin service mix. That structural margin gain can sustain higher EBITDA contribution and buffer earnings through commodity or activity slowdowns over the medium term.

Lower leverage trend

Reduced leverage enhances financial resilience, lowering interest burden and increasing ability to bid on long-term contracts. Improved capital structure supports strategic investments, reduces refinancing exposure and strengthens balance sheet durability across economic cycles.

Negative Factors

Persisting unprofitability

Ongoing negative net margin and ROE indicate the company still struggles to translate strong gross margins into bottom-line profitability. Persisting losses erode retained earnings, limit internal funding for growth and raise questions about long-term earnings sustainability.

Declining revenue

Revenue contraction reduces scale benefits and stresses fixed-cost absorption in oilfield services. Without durable top-line recovery, margin gains may be offset by lower utilization and pricing pressure, hindering capacity to rebuild earnings and capture long-term market share.

Earnings quality mismatch

A negative operating-cash-flow-to-net-income ratio signals a disconnect between accounting earnings and cash conversion. This raises concerns over earnings quality and predictability of profit-derived cash, complicating forecasting and increasing risk for capital allocation decisions.

Petro-king Oilfield Services Ltd. Business Overview & Revenue Model

Company Description

Petro-king Oilfield Services Limited, an investment holding company, provides oilfield technology services in the People's Republic of China, the Middle East, and internationally. It operates through Oilfield Project Tools and Services, Consultancy Services, and Others segments. The company offers oilfield project tools and services, such as oilfield development plan, procurement advice, tools and equipment installation, and on-site project management services, as well as assembles and sells oilfield project tools. It also provides integrated project management services that include engineering and designing an overall development plan for an oilfield project; assisting and providing advice on sourcing; oilfield project management services in the areas of drilling, well completion, downhole operation, oilfield equipment installation, and production enhancement; and on-site operational management, supervision, support, and advice services. In addition, the company offers supervisory services that comprise management, supervision, and technical support in technical areas in various stages of the oilfield project. Further, it is involved in the trading of oilfield tools and equipment. The company was formerly known as Termbray Petro-king Oilfield Services Limited and changed its name to Petro-king Oilfield Services Limited in May 2014. Petro-king Oilfield Services Limited was founded in 2002 and is headquartered in Shenzhen, the People's Republic of China.

How the Company Makes Money

Petro-king Oilfield Services Ltd. generates revenue through multiple streams, primarily by providing specialized oilfield services to exploration and production companies. Key revenue sources include drilling services, well completion operations, and ongoing maintenance contracts. The company often engages in long-term contracts with major oil and gas firms, ensuring a steady flow of income. Additionally, Petro-king may benefit from strategic partnerships with technology providers, allowing it to offer advanced solutions that cater to the evolving needs of the industry, thus enhancing its competitive edge and revenue potential.

Petro-king Oilfield Services Ltd. Financial Statement Overview

Summary

Petro-king Oilfield Services Ltd. is showing signs of financial recovery with improved margins and cash flows, yet still faces challenges with profitability and revenue growth. While leverage is managed better, the company needs to focus on driving revenue and achieving consistent profitability to ensure sustainable growth.

Income Statement

The company showed an improvement in gross profit margin in the latest year at 77.0%, up from 12.3% previously, indicating better cost management. However, the net profit margin remains negative at -6.1%, showing persistent challenges in achieving profitability. Revenue declined by 7.1%, highlighting a need for growth focus. EBIT and EBITDA margins have improved but remain modest at 1.8% and 8.7% respectively.

Balance Sheet

The debt-to-equity ratio improved to 0.86, reflecting a decrease in leverage. Return on equity has improved but remains negative at -10.3%, indicating ongoing profitability issues. The equity ratio stands at 26.9%, showing a reasonable level of equity financing compared to total assets.

Cash Flow

Free cash flow turned positive at $11.5 million, a significant improvement from a negative position, indicating better cash management. The operating cash flow to net income ratio is negative due to negative net income, but operating cash flow itself improved. Overall, cash flow performance is strengthening.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	240.08M	292.44M	314.84M	313.77M	163.97M	307.99M
Gross Profit	119.18M	225.17M	38.76M	24.72M	5.89M	64.23M
EBITDA	7.79M	31.16M	-20.09M	17.70M	-36.66M	52.02M
Net Income	-29.19M	-17.79M	-73.51M	-28.59M	-105.28M	-73.03M
Balance Sheet
Total Assets	601.01M	642.94M	712.01M	823.41M	716.49M	1.02B
Cash, Cash Equivalents and Short-Term Investments	35.40M	15.61M	48.17M	39.96M	49.97M	29.55M
Total Debt	152.51M	148.65M	189.95M	231.15M	187.15M	351.38M
Total Liabilities	429.21M	462.68M	520.86M	561.68M	425.81M	664.27M
Stockholders Equity	164.09M	172.82M	186.83M	256.05M	286.01M	331.90M
Cash Flow
Free Cash Flow	43.71M	11.51M	-29.58M	19.11M	119.80M	-32.56M
Operating Cash Flow	48.51M	19.21M	-28.71M	22.88M	125.43M	-8.90M
Investing Cash Flow	914.00K	15.51M	43.60M	27.22M	-29.07M	23.93M
Financing Cash Flow	-38.27M	-42.74M	-29.49M	-28.51M	-98.86M	-16.24M

Petro-king Oilfield Services Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.05
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2178, the sentiment is Positive. The current price of 0.05 is below the 20-day moving average (MA) of 0.06, below the 50-day MA of 0.06, and below the 200-day MA of 0.06, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 67.50 is Neutral, neither overbought nor oversold. The STOCH value of 36.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2178.

Petro-king Oilfield Services Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3337	68 Neutral	HK$2.28B	6.71	8.78%	3.59%	10.16%	49.48%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
2178	59 Neutral	HK$117.41M	-4.02	-16.54%	―	-36.59%	48.63%
0353	53 Neutral	HK$345.78M	1.34	22.21%	―	-5.34%	400.80%
1623	48 Neutral	HK$332.50M	-0.92	-11.09%	―	-2.11%	-779.00%
1080	43 Neutral	HK$344.82M	-7.50	-10.68%	―	0.97%	33.70%
0568	42 Neutral	HK$5.46B	-29.64	-20.65%	―	17.21%	59.09%