Hop Fung Group Holdings Limited (2320) AI Stock Analysis

• Market Cap: HK$56.42M
• Dividend Yield: N/A
• Average Volume (3M): 11.00K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.09
• Revenue Growth: -23.51%
• EPS Growth: -5.26%
• Country: HK
• Employees: 229
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Packaging & Containers
• EPS (TTM): -0.05
• Shares Outstanding: 817,644,040
• 10 Day Avg. Volume: 2,800
• 30 Day Avg. Volume: 11,000
• PEG Ratio: 0.00
• Price to Book (P/B): 0.09
• Price to Sales (P/S): 0.31
• P/FCF Ratio: -2.22
• 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: 45 Neutral
• Price Target: HK$0.07 ▼(-16.25% Downside)

The score is held down primarily by weak financial performance (declining revenue, large losses, and negative cash flow). Technicals offer some support (price above major moving averages and positive MACD), but overbought momentum signals temper that benefit. Valuation remains unattractive due to a negative P/E driven by losses.

Positive Factors

Low leverage

A low debt-to-equity ratio (0.13) implies manageable leverage and greater financial flexibility. Over a multi-month horizon this reduces insolvency risk, preserves borrowing capacity for working capital or capex, and helps sustain operations while management pursues turnaround actions.

Improving FCF metrics

Despite current negative operating cash flow, a positive FCF-to-net-income ratio and 29.2% FCF growth signal improving cash conversion. This trend can underpin stabilization of liquidity and fund essential investments or deleveraging if sustained over several quarters.

Low market volatility (beta)

A very low beta indicates the company's equity has historically moved little with market swings, reflecting lower earnings volatility. For long-term investors this can mean steadier operational conditions and less refinancing or covenant stress during market turbulence.

Negative Factors

Deep negative margins

Very large negative operating and net margins indicate the core business is loss-making and failing to cover costs. Sustained margin deficits erode equity, consume cash, and make it hard to fund investments or return to profitability without structural cost reduction or revenue recovery.

Declining revenue

Sequential revenue decline reduces scale and hinders leverage on fixed costs, perpetuating losses. If top-line weakness persists, margin recovery and cash-flow improvement become harder, increasing the risk that turnaround measures cannot restore sustainable profitability.

Negative ROE and cash flow strain

Negative ROE coupled with negative operating and free cash flow points to structural profitability and cash-generation problems. Over months this undermines shareholder value, limits reinvestment capacity, and raises the need for external financing or strategic restructuring to survive.

Hop Fung Group Holdings Limited Business Overview & Revenue Model

Company Description

Hop Fung Group Holdings Limited, an investment holding company, manufactures and sells corrugated paper ware products in the People's Republic of China. It operates through Containerboard and Corrugated Packaging segments. The Containerboard segment offers corrugating medium and linerboards. The Corrugated Packaging segment provides corrugated paper boards and carton boxes. The company also offers management and accounting services. Hop Fung Group Holdings Limited was founded in 1983 and is based in Tsuen Wan, Hong Kong.

How the Company Makes Money

Hop Fung Group generates revenue primarily through the sale of its corrugated paper and packaging products. The company operates on a business-to-business (B2B) model, supplying its products to manufacturers and retailers across various sectors. Key revenue streams include custom packaging solutions tailored to specific client needs, standard packaging products, and related services such as design and logistics support. Significant partnerships with large retailers and manufacturers enhance its market presence and drive sales. Additionally, the company's focus on sustainability and innovation in product development helps attract environmentally conscious clients, contributing to its revenue growth.

Hop Fung Group Holdings Limited Financial Statement Overview

Summary

Financials are weak: revenue declined (-6.39%) and profitability is deeply negative (net margin -45.02%, EBIT margin -42.68%). Leverage is low (debt-to-equity 0.13), but negative ROE (-13.08%) plus negative operating and free cash flow indicate ongoing operational strain.

Income Statement

The company has been experiencing declining revenue with a negative growth rate of -6.39% in the latest year. Profitability metrics are concerning, with a negative net profit margin of -45.02% and a negative EBIT margin of -42.68%. These figures indicate significant challenges in generating profits from operations.

Balance Sheet

The balance sheet shows a relatively low debt-to-equity ratio of 0.13, suggesting manageable leverage. However, the return on equity is negative at -13.08%, indicating that the company is not generating positive returns on shareholders' equity. The equity ratio is not explicitly calculated, but the overall financial stability appears weak due to ongoing losses.

Cash Flow

Cash flow analysis reveals negative operating cash flow and free cash flow, although the free cash flow to net income ratio is positive at 1.12, indicating some efficiency in cash generation relative to net income. The free cash flow growth rate is positive at 29.2%, but the overall cash flow situation remains challenging with negative operating cash flow coverage.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	172.83M	211.52M	224.36M	424.41M	755.60M	1.04B
Gross Profit	13.57M	17.77M	13.93M	7.40M	-371.51M	127.87M
EBITDA	-65.89M	-38.27M	-41.44M	-114.17M	-375.47M	107.06M
Net Income	-89.96M	-95.23M	-100.80M	-192.72M	-422.79M	1.36M
Balance Sheet
Total Assets	870.23M	908.38M	1.02B	1.19B	1.64B	2.20B
Cash, Cash Equivalents and Short-Term Investments	24.58M	34.14M	47.27M	110.80M	246.68M	291.56M
Total Debt	91.98M	92.51M	73.77M	98.41M	236.94M	290.58M
Total Liabilities	160.82M	180.42M	177.53M	229.19M	393.87M	581.90M
Stockholders Equity	709.41M	727.96M	842.89M	961.91M	1.25B	1.62B
Cash Flow
Free Cash Flow	-29.29M	-29.50M	-40.87M	-3.64M	28.56M	-28.06M
Operating Cash Flow	-26.98M	-26.33M	-32.14M	374.00K	65.01M	105.63M
Investing Cash Flow	-1.91M	-3.11M	-5.20M	-1.58M	-32.51M	-131.56M
Financing Cash Flow	482.00K	16.06M	-26.33M	-132.24M	-81.26M	40.94M

Hop Fung Group Holdings Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.08
• 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:2320, the sentiment is Negative. The current price of 0.08 is above the 20-day moving average (MA) of 0.08, above the 50-day MA of 0.08, and below the 200-day MA of 0.09, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 37.45 is Neutral, neither overbought nor oversold. The STOCH value of 25.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:2320.

Hop Fung Group Holdings Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
6898	58 Neutral	HK$660.83M	41.42	13.20%	0.59%	-2.08%	-23.18%
1629	46 Neutral	HK$97.20M	-8.77	-4.08%	―	―	―
1820	46 Neutral	HK$751.58M	-24.49	-5.51%	3.20%	3.51%	-950.83%
8291	45 Neutral	HK$14.13M	3.20	―	―	-44.08%	―
2320	45 Neutral	HK$56.42M	-0.63	-12.11%	―	-23.51%	-5.26%
1239	43 Neutral	HK$251.73M	-2.55	―	―	-44.23%	41.20%