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Kato (Hong Kong) Holdings Ltd. (HK:2189)
:2189
Hong Kong Market
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Kato (Hong Kong) Holdings Ltd. (2189) AI Stock Analysis

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HK:2189

Kato (Hong Kong) Holdings Ltd.

(2189)

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Neutral 60 (OpenAI - 4o)
Rating:60Neutral
Price Target:
HK$0.50
▲(6.38% Upside)
Kato (Hong Kong) Holdings Ltd. receives a moderate score of 60. The company's strong revenue growth and high gross profit margin are offset by declining net profit margins and cash flow challenges. The stock's technical indicators suggest it is overbought, and while the valuation is reasonable, the P/E ratio is on the higher side. The attractive dividend yield provides some support to the overall score.

Kato (Hong Kong) Holdings Ltd. (2189) vs. iShares MSCI Hong Kong ETF (EWH)

Kato (Hong Kong) Holdings Ltd. Business Overview & Revenue Model

Company DescriptionKato (Hong Kong) Holdings Limited, an investment holding company, engages in the provision of residential and day care services for the elderly in Hong Kong. The company provides a range of residential care services for the elderly, including accommodation, professional nursing and care-taking, nutritional management, medical, physiotherapy and occupational therapy, psychological and social care, individual care, and recreational services; and sells healthcare and medical goods, as well as offers add-on healthcare services to its residents. It also operates home care support services; and invests in properties, as well as provides properties management services. As of March 31, 2022, it operated eight care and attention homes for the elderly with 1,129 residential care places across four districts in Hong Kong under the Fai To, Kato, Happy Luck Home, Tsuen Wan Centre, and Pine Villa brand names. The company was founded in 1991 and is based in Tuen Mun, Hong Kong. Kato (Hong Kong) Holdings Limited is a subsidiary of Sheung Fung Limited.
How the Company Makes MoneyKato (Hong Kong) Holdings Ltd. generates revenue primarily through the sale and leasing of residential and commercial properties. Its core revenue streams include income from property sales, rental income from leased properties, and service fees from real estate management. The company also benefits from strategic partnerships with local contractors and suppliers, which help in reducing construction costs and improving project timelines. Additionally, Kato may engage in joint ventures or collaborations with other developers to expand its portfolio and enhance its market presence, thereby contributing to its overall earnings.

Kato (Hong Kong) Holdings Ltd. Financial Statement Overview

Summary
Kato (Hong Kong) Holdings Ltd. shows strong revenue growth and a high gross profit margin, but faces challenges with declining net profit margins and cash flow. Improved leverage is a positive, but lower return on equity indicates reduced profitability.
Income Statement
65
Positive
Kato (Hong Kong) Holdings Ltd. has shown a mixed performance in its income statement. The company achieved a strong gross profit margin of 93.61% in the latest year, indicating effective cost management. However, the net profit margin has decreased significantly from previous years, now at 6.90%, reflecting challenges in maintaining profitability. Revenue growth of 11.60% is a positive sign, but the decline in EBIT and EBITDA margins suggests pressure on operational efficiency.
Balance Sheet
70
Positive
The balance sheet of Kato (Hong Kong) Holdings Ltd. demonstrates moderate financial stability. The debt-to-equity ratio has improved to 0.76, indicating a reduction in leverage compared to previous years. However, the return on equity has decreased to 5.01%, suggesting lower profitability from shareholders' investments. The equity ratio remains stable, reflecting a balanced capital structure.
Cash Flow
60
Neutral
Cash flow analysis reveals some concerns for Kato (Hong Kong) Holdings Ltd. The free cash flow growth rate has declined by 44.47%, indicating potential cash flow challenges. The operating cash flow to net income ratio is slightly above 1, showing adequate cash generation relative to net income. However, the free cash flow to net income ratio has decreased, suggesting reduced cash available for reinvestment or debt repayment.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue284.15M317.11M271.33M408.30M320.34M256.53M
Gross Profit143.09M296.85M135.21M185.43M143.75M123.15M
EBITDA75.11M96.84M133.61M206.90M161.67M131.88M
Net Income69.92M21.88M64.19M126.15M98.94M79.87M
Balance Sheet
Total Assets839.00M809.57M863.30M699.30M621.62M602.60M
Cash, Cash Equivalents and Short-Term Investments52.53M52.66M68.71M78.53M58.24M109.12M
Total Debt357.84M332.96M384.30M270.03M294.79M342.05M
Total Liabilities398.03M367.34M428.77M326.36M329.41M369.44M
Stockholders Equity440.89M436.75M434.29M372.63M291.53M232.63M
Cash Flow
Free Cash Flow128.06M71.11M108.10M103.78M42.00M111.80M
Operating Cash Flow103.75M90.89M132.42M159.91M118.98M117.95M
Investing Cash Flow-125.31M9.29M-236.10M-55.89M-75.39M-105.33M
Financing Cash Flow36.22M-86.55M69.67M-84.02M-93.67M52.25M

Kato (Hong Kong) Holdings Ltd. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price0.47
Price Trends
50DMA
0.43
Positive
100DMA
0.43
Positive
200DMA
0.44
Positive
Market Momentum
MACD
<0.01
Negative
RSI
91.29
Negative
STOCH
65.82
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2189, the sentiment is Positive. The current price of 0.47 is above the 20-day moving average (MA) of 0.43, above the 50-day MA of 0.43, and above the 200-day MA of 0.44, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 91.29 is Negative, neither overbought nor oversold. The STOCH value of 65.82 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2189.

Kato (Hong Kong) Holdings Ltd. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
400.47M12.560.00%6.80%-2.88%-21.65%
71
Outperform
658.76M8.631.07%8.12%0.47%50.46%
64
Neutral
341.67M-7.318.55%3.16%-21.31%-149.92%
60
Neutral
HK$470.00M21.465.02%4.26%16.87%-65.89%
55
Neutral
379.55M18.630.00%2.80%-0.69%0.00%
48
Neutral
939.72M6.460.00%2.30%0.00%
51
Neutral
$7.86B-0.30-43.30%2.27%22.53%-2.21%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:2189
Kato (Hong Kong) Holdings Ltd.
0.47
-0.03
-6.00%
HK:1419
Human Health Holdings Ltd.
0.98
0.14
16.67%
HK:1518
New Century Healthcare Holding Co. Ltd.
0.70
-0.08
-10.26%
HK:3689
Guangdong Kanghua Healthcare Co., Ltd. Class H
1.86
-0.34
-15.45%
HK:3869
Hospital Corporation of China Ltd
6.80
3.00
78.95%
HK:0722
UMP Healthcare Holdings Limited
0.50
0.07
16.28%

Kato (Hong Kong) Holdings Ltd. Corporate Events

Kato Holdings Announces Successful AGM Resolutions
Sep 10, 2025

Kato (Hong Kong) Holdings Limited, a company incorporated in the Cayman Islands, announced the successful passing of all proposed resolutions during its Annual General Meeting held on September 10, 2025. The resolutions, which were approved by shareholders through a poll, included the adoption of audited financial statements, re-election of directors, approval of directors’ remuneration, declaration of a final dividend, reappointment of the company’s auditor, and granting of mandates to the directors for share issuance and repurchase. This outcome reflects strong shareholder support and positions the company for continued governance and operational activities in the upcoming year.

Kato (Hong Kong) Holdings Announces 2025 AGM and Key Resolutions
Jul 31, 2025

Kato (Hong Kong) Holdings Limited has announced its upcoming annual general meeting, scheduled for September 10, 2025, where shareholders will consider various resolutions including the adoption of financial statements, re-election of directors, and the declaration of a final dividend. The meeting will also address the re-appointment of PricewaterhouseCoopers as the company’s independent auditor and authorize the board to manage directors’ remuneration and the issuance of shares, impacting the company’s governance and shareholder value.

Kato Holdings Announces Changes to AGM and Dividend Schedule
Jul 21, 2025

Kato (Hong Kong) Holdings Ltd. has announced changes to the schedule of its annual general meeting (AGM), the proposed dividend payment date, and the closure of its register of members. The AGM, initially set for August 29, 2025, will now take place on September 10, 2025. Consequently, the dividend payment date has been moved from September 17, 2025, to September 29, 2025. These adjustments are crucial for shareholders as they affect the timing of dividend receipts and voting rights at the AGM.

Kato Holdings Announces Updated Final Dividend for FY2025
Jul 21, 2025

Kato (Hong Kong) Holdings Ltd. has announced an updated final cash dividend of HKD 0.02 per share for the financial year ending March 31, 2025. This update includes key dates such as the ex-dividend date on September 15, 2025, and the payment date on September 29, 2025, reflecting the company’s commitment to providing returns to its shareholders.

Kato Holdings Proposes Amendments to Articles of Association
Jul 21, 2025

Kato (Hong Kong) Holdings Limited has announced proposed amendments to its articles of association to align with changes in the Listing Rules and Cayman Islands laws. These amendments aim to enhance electronic communication, facilitate electronic and hybrid meetings, and improve corporate governance and operational flexibility. The company also plans to adopt a new set of articles incorporating these changes, which include provisions for electronic communication, hybrid meetings, management of treasury shares, and updates for clarity and consistency.

Kato Holdings Reports Revenue Growth but Decline in Profit for 2025
Jun 23, 2025

Kato (Hong Kong) Holdings Ltd. announced its annual results for the year ending March 31, 2025, reporting a total revenue of approximately HK$317.1 million, marking a 16.9% increase from the previous year. Despite the revenue growth, the company’s profit attributable to owners decreased by 65.9% to approximately HK$21.9 million. The board recommended a final dividend of HK2.0 cents per share, pending shareholder approval. The results reflect a challenging year with increased expenses across several categories, impacting overall profitability.

Kato Holdings Declares Final Dividend for 2025
Jun 23, 2025

Kato (Hong Kong) Holdings Limited has announced a final ordinary cash dividend of HKD 0.02 per share for the financial year ending March 31, 2025. This announcement, made on June 23, 2025, outlines key dates including the ex-dividend date on September 3, 2025, and the payment date on September 17, 2025. The dividend decision reflects the company’s financial performance and commitment to returning value to its shareholders.

Kato Holdings Enhances Board Governance with New Nomination Committee
Jun 23, 2025

Kato (Hong Kong) Holdings Ltd. has announced the adoption of terms of reference for its Nomination Committee, which is part of its board of directors. The committee will consist of at least three members, primarily independent non-executive directors, with a focus on diversity by including at least one member of a different gender. This move is expected to enhance the governance structure and ensure a diverse and independent oversight within the company’s board operations.

Kato Holdings Issues Profit Warning Amidst Decline in Property Values
Jun 19, 2025

Kato (Hong Kong) Holdings Limited has issued a profit warning, indicating a significant decrease in profit for the year ending March 31, 2025. The expected profit is not less than HK$18.0 million, a sharp decline from the previous year’s HK$64.2 million, primarily due to a fair value loss on investment properties. This announcement suggests potential challenges for the company and advises shareholders and potential investors to exercise caution.

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: Sep 11, 2025