Honworld Group Ltd. (2226) AI Stock Analysis

• Market Cap: HK$312.53M
• Dividend Yield: N/A
• Average Volume (3M): 76.77K
• Price to Earnings (P/E): ―
• Beta (1Y): -0.09
• Revenue Growth: -0.28%
• EPS Growth: 1.40%
• Country: HK
• Employees: 509
• Sector: Consumer Defensive
• Sector Strength: 44
• Industry: Packaged Foods
• EPS (TTM): -0.47
• Shares Outstanding: 578,750,000
• 10 Day Avg. Volume: 113,700
• 30 Day Avg. Volume: 76,766
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: HK$0.50
• Price Target Upside: -12.28% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 41 Neutral
• Price Target: HK$0.50 ▼(-12.28% Downside)

The overall stock score is primarily driven by the company's poor financial performance, which poses significant risks to its future viability. Technical analysis and valuation also contribute to a low score, with mixed signals and negative profitability metrics. The lack of earnings call data and corporate events leaves these areas unaddressed.

Positive Factors

Brand Reputation

Honworld's established brand reputation in premium Chinese cooking wine supports long-term customer loyalty and market presence, crucial for sustaining revenue despite current financial challenges.

Product Quality

Emphasizing product quality and authenticity helps Honworld differentiate itself in the competitive condiment market, potentially aiding in market retention and expansion over time.

Distribution Network

A robust distribution network enhances market reach and accessibility, supporting sales growth and resilience against market fluctuations, which is vital for long-term business sustainability.

Negative Factors

Financial Instability

Persistent financial instability with declining revenue and losses undermines Honworld's ability to invest in growth and innovation, posing significant risks to its long-term viability.

Negative Cash Flow

Negative cash flow from operations indicates liquidity issues, limiting Honworld's ability to fund operations and growth internally, increasing reliance on external financing.

High Leverage

High leverage increases financial risk and limits flexibility, potentially hindering Honworld's capacity to navigate economic downturns or invest in strategic opportunities.

Honworld Group Ltd. Business Overview & Revenue Model

Company Description

Honworld Group Limited, an investment holding company, manufactures and sells cooking wine and other condiment products under the Lao Heng He brand in the People's Republic of China. The company offers soy sauce, vinegar, soybean paste, and fermented bean curd products. It also engages in the wholesale of condiment products. The company was incorporated in 2012 is headquartered in Huzhou, the People's Republic of China.

How the Company Makes Money

Honworld Group Ltd. generates revenue primarily through the sale of its premium Chinese cooking wine products. The company leverages its established brand reputation and extensive distribution network to reach a wide range of customers, including wholesalers, retailers, and direct consumers. By focusing on product quality and authenticity, Honworld maintains a competitive edge in the condiment market. The company may also engage in strategic partnerships to expand its market reach and enhance its product offerings, although specific partnership details are not disclosed.

Honworld Group Ltd. Financial Statement Overview

Summary

Honworld Group Ltd. is facing substantial financial difficulties, with declining revenue, consistent operating losses, negative equity, and poor cash flow management. The company's financial instability and heavy reliance on debt pose significant risks to its future viability and growth prospects.

Income Statement

Honworld Group Ltd. has experienced a significant decline in financial performance over recent years, with consistent negative EBIT, EBITDA, and net income figures. The Gross Profit Margin has been positive, but overall profitability is severely impacted by high operating losses. Revenue has declined significantly from 2019 to 2024, indicating a challenging business environment and diminished market position.

Balance Sheet

The balance sheet reveals negative stockholders' equity, indicating financial distress and potential insolvency risks. The Debt-to-Equity Ratio cannot be calculated due to negative equity, and the company is heavily leveraged with increasing total debt. These factors suggest a precarious financial position with limited stability and high financial risk.

Cash Flow

Cash flow from operations has been negative, and the company has failed to generate free cash flow. The absence of positive cash flow metrics raises concerns about liquidity and the company's ability to sustain operations without external financing.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	275.08M	258.78M	271.60M	252.67M	226.33M
Gross Profit	68.91M	74.11M	74.82M	68.51M	45.60M
EBITDA	-32.09M	-74.66M	-74.07M	-153.91M	-108.45M
Net Income	-516.56M	-524.32M	-495.32M	-466.56M	-845.29M
Balance Sheet
Total Assets	1.05B	1.11B	1.12B	1.19B	1.21B
Cash, Cash Equivalents and Short-Term Investments	6.35M	10.12M	9.81M	31.02M	8.44M
Total Debt	3.31B	2.81B	2.21B	1.76B	1.50B
Total Liabilities	3.90B	3.45B	2.93B	2.51B	2.21B
Stockholders Equity	-2.85B	-2.33B	-1.81B	-1.32B	-1.00B
Cash Flow
Free Cash Flow	-20.97M	-122.22M	-243.70M	-116.33M	-199.17M
Operating Cash Flow	-830.00K	-102.22M	-226.80M	-97.81M	-196.79M
Investing Cash Flow	-20.13M	-22.46M	-19.02M	-12.42M	81.33M
Financing Cash Flow	18.62M	126.05M	228.54M	131.75M	-53.31M

Honworld Group Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.57
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2226, the sentiment is Negative. The current price of 0.57 is below the 20-day moving average (MA) of 0.61, below the 50-day MA of 0.63, and below the 200-day MA of 0.63, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 30.38 is Neutral, neither overbought nor oversold. The STOCH value of 33.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:2226.

Honworld Group Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1837	79 Outperform	HK$1.95B	8.76	13.72%	4.44%	11.89%	27.80%
Sector *	62 Neutral	$20.32B	14.51	-3.18%	3.18%	1.92%	-6.57%
2226	41 Neutral	HK$312.53M	―		―	-0.28%	1.40%
3DS	―	€69.13M	23.60	-0.32%	―	―	―
1767	70 Outperform	HK$310.00M	11.74	5.48%	0.74%	5.43%	-25.42%
1285	64 Neutral	HK$435.75M	9.11	4.62%	9.52%	2.82%	-22.62%
1262	40 Underperform	HK$432.46M	―	-23.87%	―	4.72%	79.88%

Honworld Group Ltd. Corporate Events

Honworld Group Ltd. Enhances Governance with Revised Nomination Committee Terms

Honworld Group Ltd. has revised the terms of reference for its Nomination Committee, emphasizing the inclusion of independent non-executive directors and gender diversity. This move is aimed at strengthening the governance structure and ensuring diverse perspectives in decision-making, which could enhance the company’s industry positioning and stakeholder confidence.

Honworld Group Announces Executive Leadership Changes

Honworld Group Limited announced significant changes in its executive leadership, with Mr. Chen Wei resigning from his roles as executive director, chairman of the board, and authorized representative, effective June 3, 2025. Mr. Huang Dachun has been appointed as the new executive director, chairman of the board, and authorized representative, while Mr. Zhu Bing will take over as the chief executive officer. These changes are part of the company’s strategic efforts to ensure continued leadership and governance, with Mr. Huang bringing extensive experience from his previous roles in government and investment operations.

Honworld Group Limited Announces Board Restructuring

Honworld Group Limited has announced changes to its board of directors, effective from June 3, 2025. The board now includes Mr. Huang Dachun as Chairman, Mr. Zhu Bing as an Executive Director, Ms. Wang Yanping as a Non-executive Director, and three Independent Non-executive Directors: Mr. Shen Zhenchang, Mr. Ng Wing Fai, and Mr. Sun Jiong. These changes may impact the company’s governance and strategic direction, as the new board members will assume roles in key committees such as audit, remuneration, and nomination.

Honworld Group Appoints New Nomination Committee Member

Honworld Group Limited has announced the appointment of Ms. Wang Yanping as a member of its nomination committee, effective from May 27, 2025. This appointment reflects the company’s ongoing efforts to enhance its governance structure and strengthen its leadership team, potentially impacting its strategic direction and stakeholder relations.

Honworld Group Limited Announces New Board Structure

Honworld Group Limited has announced the composition of its board of directors, effective from May 27, 2025. The board includes Mr. Chen Wei as the Executive Director and Chairman, Ms. Wang Yanping as a Non-executive Director, and three Independent Non-executive Directors: Mr. Shen Zhenchang, Mr. Ng Wing Fai, and Mr. Sun Jiong. This announcement outlines the roles and functions of each director within the company’s three board committees, which are the Audit, Remuneration, and Nomination Committees. The new board structure is expected to enhance governance and strategic oversight at Honworld Group Limited.

Honworld Group’s AGM Resolutions Passed Unanimously

Honworld Group Limited announced that all resolutions proposed at their Annual General Meeting held on May 26, 2025, were passed unanimously. The resolutions included the adoption of financial statements, reappointment of the auditor, re-election of directors, and granting of mandates for share issuance and repurchase. This unanimous approval signifies strong shareholder support and may positively impact the company’s governance and strategic flexibility.