Steve Leung Design Group Limited (2262) AI Stock Analysis

• Market Cap: HK$913.12M
• Dividend Yield: N/A
• Average Volume (3M): 67.00K
• Price to Earnings (P/E): 96.4
• Beta (1Y): 0.51
• Revenue Growth: 9.92%
• EPS Growth: N/A
• Country: HK
• Employees: 400
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): <0.01
• Shares Outstanding: 1,141,401,000
• 10 Day Avg. Volume: 14,700
• 30 Day Avg. Volume: 67,000
• PEG Ratio: -2.08
• Price to Book (P/B): 1.35
• Price to Sales (P/S): 1.12
• P/FCF Ratio: 14.98
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 44 Neutral
• Price Target: HK$0.78 ▼(-3.00% Downside)

The overall stock score of 44 reflects significant challenges in valuation and technical analysis. The high P/E ratio suggests overvaluation, while technical indicators point to bearish momentum. Financial performance shows some recovery, but consistent profitability remains a challenge. The absence of earnings call insights and corporate events leaves the stock's outlook largely dependent on financial and market trends.

Positive Factors

Balance Sheet Health

The company's low leverage indicates reduced financial risk and strong capitalization, providing a stable financial foundation for future growth.

Cash Generation Ability

Improved cash flow management and lower capital expenditures enhance financial flexibility, supporting sustainable operations and potential investments.

Operational Efficiency

A healthy gross profit margin reflects efficient operations, which can lead to better profitability and competitive positioning in the design industry.

Negative Factors

Profitability Challenges

Despite positive net profit margins, the low percentage indicates ongoing challenges in achieving consistent profitability, impacting long-term financial health.

Volatile Cash Flow

Volatile cash flow can pose risks to financial stability, affecting the company's ability to manage operations and invest in growth consistently.

Industry Fluctuations

Industry volatility can impact project demand and revenue stability, posing challenges to maintaining steady growth and profitability over time.

Steve Leung Design Group Limited Business Overview & Revenue Model

Company Description

Steve Leung Design Group Limited (2262) is a Hong Kong-based design firm specializing in architecture and interior design. Founded by renowned designer Steve Leung, the company operates primarily in the luxury residential, commercial, and hospitality sectors. By combining innovative design concepts with a deep understanding of market trends, the firm offers a range of services, including project management, consultancy, and branding, aimed at enhancing the aesthetic and functional qualities of spaces.

How the Company Makes Money

The company generates revenue primarily through its design services, which include architectural and interior design projects for high-end residential, commercial, and hospitality clients. Key revenue streams come from project fees, consultation charges, and management services for various design and construction projects. Additionally, Steve Leung Design Group may also earn income through strategic partnerships with property developers and construction firms, where they provide tailored design solutions. Their reputation for excellence and a strong portfolio of completed projects further contribute to securing new contracts and maintaining a steady flow of income.

Steve Leung Design Group Limited Financial Statement Overview

Summary

The company shows signs of financial recovery with improved profitability and cash flow management. It maintains a strong balance sheet with low leverage, but challenges remain in achieving consistent profitability and growth.

Income Statement

The company showed a modest improvement in revenue from 2023 to 2024, with a revenue growth rate of 3.34%. However, the gross profit margin was 39.92% in 2024, which reflects healthy operational efficiency. The net profit margin turned positive at 0.49% in 2024 after experiencing losses in the previous years, indicating a return to profitability. The EBIT margin rebounded to 5.93%, showcasing better control over operating expenses. Despite these improvements, the company still faces challenges in sustaining consistent profitability, as evidenced by fluctuating margins over the years.

Balance Sheet

The company's balance sheet shows a stable financial position with a debt-to-equity ratio of 0.20 in 2024, reflecting low leverage and reduced financial risk. The equity ratio stood at 60.96%, indicating strong capitalization and a solid asset base. Return on Equity (ROE) was low at 0.59% due to minimal net income, suggesting limited returns for shareholders. Overall, the company's balance sheet demonstrates stability, but profitability remains a concern.

Cash Flow

The cash flow statements indicate a healthy operating cash flow to net income ratio of 16.61 in 2024, showcasing strong cash generation relative to net income. Free cash flow increased by 33.41% from 2023 to 2024, highlighting improved cash management and lower capital expenditures. However, the company's cash flow from operations has shown volatility over the years, which could be a potential risk factor.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	397.77M	367.69M	355.80M	381.00M	455.04M	432.97M
Gross Profit	155.80M	146.82M	139.03M	139.25M	188.90M	187.94M
EBITDA	35.31M	38.84M	13.19M	-19.89M	49.82M	99.94M
Net Income	9.53M	1.80M	-18.84M	-62.44M	2.94M	33.53M
Balance Sheet
Total Assets	478.75M	497.35M	497.86M	523.08M	649.84M	710.05M
Cash, Cash Equivalents and Short-Term Investments	112.67M	140.88M	148.89M	153.34M	276.96M	275.26M
Total Debt	41.63M	61.70M	75.27M	71.16M	66.20M	87.03M
Total Liabilities	160.21M	183.29M	181.80M	183.88M	171.96M	210.19M
Stockholders Equity	308.29M	303.27M	304.54M	326.42M	466.92M	487.80M
Cash Flow
Free Cash Flow	50.17M	27.43M	20.56M	-40.03M	60.96M	43.09M
Operating Cash Flow	51.75M	29.99M	21.72M	-35.21M	66.83M	56.14M
Investing Cash Flow	-1.47M	-2.11M	-671.00K	26.47M	-29.33M	-12.17M
Financing Cash Flow	-36.61M	-34.64M	-24.42M	-75.81M	-69.90M	-49.82M

Steve Leung Design Group Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2262, the sentiment is Negative. The current price of 0.8 is below the 20-day moving average (MA) of 0.95, below the 50-day MA of 1.03, and below the 200-day MA of 1.06, indicating a bearish trend. The MACD of -0.07 indicates Positive momentum. The RSI at 7.17 is Positive, neither overbought nor oversold. The STOCH value of >-0.01 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:2262.

Steve Leung Design Group Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1627	80 Outperform	HK$1.34B	5.66	14.15%	8.96%	26.57%	-2.39%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
1726	53 Neutral	HK$1.53B	-19.09	-68.32%	―	26.40%	-6.44%
2262	44 Neutral	HK$913.12M	96.39	3.15%	―	9.92%	―
1499	41 Neutral	HK$955.95M	-80.91	-7.49%	―	-16.73%	65.63%
1707	41 Neutral	HK$52.08M	-3.37	-9.58%	―	3.97%	14.02%
1683	39 Underperform	HK$793.15M	―	-8.55%	―	-37.55%	-1727.78%

Steve Leung Design Group Limited Corporate Events

Steve Leung Design Group Clarifies Ownership in Transaction

Steve Leung Design Group Limited announced supplemental information regarding a discloseable transaction related to a Renewal Offer Letter. The announcement clarified the identity of the ultimate beneficial owner of the Landlord and the Agent involved in the transaction, revealing that Manhattan Realty Limited, owned by Mr. Tien Pei Chun, James, is the ultimate beneficial owner. This disclosure provides transparency in the company’s dealings, potentially impacting stakeholder trust and industry positioning.

Steve Leung Design Group Secures Six-Year Lease Renewal for Hong Kong Headquarters

Steve Leung Design Group Limited has announced the renewal of its tenancy agreement for its headquarters in Hong Kong. The new lease, effective from May 2026 to April 2032, allows the company to continue its operations at the same premises, ensuring stability for its business activities. The renewal is considered a discloseable transaction under the Hong Kong Listing Rules, reflecting the company’s strategic decision to maintain its current location, which aligns with market rental conditions and is deemed beneficial for the company and its shareholders.