LX Technology Group Limited (2436) AI Stock Analysis

• Market Cap: HK$4.95B
• Dividend Yield: N/A
• Average Volume (3M): 50.00
• Price to Earnings (P/E): ―
• Beta (1Y): 0.11
• Revenue Growth: 32.83%
• EPS Growth: 90.24%
• Country: HK
• Employees: 970
• Sector: Technology
• Sector Strength: 88
• Industry: Computer Hardware
• EPS (TTM): 0.02
• Shares Outstanding: 353,259,000
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 50
• PEG Ratio: 0.33
• Price to Book (P/B): 1.45
• Price to Sales (P/S): 0.44
• P/FCF Ratio: -4.19
• 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: 48 Neutral
• Price Target: HK$14.00 ▲(204.35% Upside)

The score is primarily weighed down by weak financial quality (ongoing losses, high leverage, and negative free cash flow) and limited valuation support due to negative earnings. Technicals are the main offset, showing strong momentum, but the extremely overbought RSI increases near-term reversal risk.

Positive Factors

Strong revenue growth

Sustained 32% revenue growth indicates expanding product adoption and market penetration across the firm's telecom, IT and digital services. Over 2–6 months this top-line momentum supports scale economics, R&D reinvestment and channel leverage if margins gradually improve.

Diversified revenue streams

Multiple streams—hardware, software, subscriptions, consulting and maintenance—plus strategic telco partnerships reduce customer concentration and revenue volatility. Recurring contracts and partnerships provide predictable demand and durable cross-sell opportunities over the medium term.

Operating cash generation

Positive operating cash conversion despite accounting losses suggests core operations produce real cash, improving liquidity flexibility. This durable cash capability can fund working capital and selective investment while management works to close profitability gaps.

Negative Factors

Ongoing unprofitability

Persistent negative net and EBIT margins signal structural profitability issues. Without sustained margin expansion or cost rationalization, the company may struggle to convert revenue growth into earnings, constraining reinvestment and long-term shareholder returns.

High financial leverage

Elevated debt-to-equity increases interest burden and reduces strategic flexibility. In a multi-quarter horizon, high leverage magnifies downside risk if margins or cash flows falter, potentially forcing asset sales, higher financing costs, or equity raises that dilute existing investors.

Negative free cash flow

Persistent negative free cash flow constrains the firm's ability to fund capex, repay debt, or invest in growth organically. Over 2–6 months this structural cash deficit likely necessitates external financing or operational changes, raising execution and solvency risk.

LX Technology Group Limited Business Overview & Revenue Model

Company Description

LX Technology Group Limited operates as a device lifecycle management solution provider in the People's Republic of China. The company operates through Recycling Business and Device Subscription Services segments. It is involved in the sale of refurbished de-commissioned information technology (IT) devices to resellers of IT devices through proprietary quotation platform and e-commerce platforms; and the provision of device and IT technical subscription services to SMEs. The company was founded in 2004 and is headquartered in Shenzhen, the People's Republic of China.

How the Company Makes Money

LX Technology Group Limited generates revenue through multiple streams, primarily by offering telecommunications infrastructure services and IT solutions. The company's main revenue sources include the sale of hardware and software products, subscription-based services for cloud solutions, and consulting fees for IT advisory services. Additionally, strategic partnerships with major telecommunications providers and technology firms enhance its market reach and provide access to new clients, contributing significantly to its earnings. The company also benefits from ongoing maintenance contracts and service agreements, ensuring a steady income flow from existing clients.

LX Technology Group Limited Financial Statement Overview

Summary

Revenue is growing strongly (32.3% from 2022 to 2023), but the business remains unprofitable with negative net profit and EBIT margins. Leverage is high (elevated debt-to-equity) and free cash flow has been negative, raising liquidity and financial stability risk despite operating cash generation.

Income Statement

The company has shown a consistent increase in revenue over the years, with a notable revenue growth rate of 32.3% from 2022 to 2023. However, profitability remains a concern as indicated by negative net profit margins and EBIT margins in recent years. The gross profit margin has been relatively stable but low, reflecting challenges in cost management or pricing strategy.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio, indicating significant leverage, which could pose financial risks. The equity ratio has improved over the years, but the company still faces challenges in maintaining a strong equity base. Return on equity is negative, reflecting ongoing profitability issues.

Cash Flow

The company has experienced negative free cash flow in recent years, indicating potential liquidity issues. The operating cash flow to net income ratio is positive, suggesting that the company can generate cash from operations despite net losses. However, the free cash flow to net income ratio is negative, highlighting challenges in covering capital expenditures.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.55B	2.37B	1.79B	1.66B	1.33B	1.02B
Gross Profit	205.41M	196.40M	147.63M	199.28M	193.14M	146.86M
EBITDA	211.16M	179.72M	183.45M	374.82M	-216.63M	-24.65M
Net Income	-11.51M	-56.95M	-131.27M	99.95M	-448.70M	-177.13M
Balance Sheet
Total Assets	1.81B	1.72B	1.68B	1.56B	1.18B	941.08M
Cash, Cash Equivalents and Short-Term Investments	578.62M	402.37M	460.23M	457.08M	118.55M	80.38M
Total Debt	871.81M	821.63M	710.29M	563.83M	1.68B	327.66M
Total Liabilities	1.06B	1.01B	941.29M	753.55M	1.81B	1.11B
Stockholders Equity	729.51M	714.27M	736.57M	807.31M	-630.22M	-169.89M
Cash Flow
Free Cash Flow	-148.15M	-247.24M	-159.51M	14.19M	-162.53M	-202.99M
Operating Cash Flow	1.17M	51.42M	164.49M	342.36M	278.78M	109.93M
Investing Cash Flow	-119.53M	-222.60M	-28.84M	-597.92M	-450.97M	-319.98M
Financing Cash Flow	-59.46M	59.13M	96.70M	287.46M	210.37M	214.51M

LX Technology Group Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2436, the sentiment is Positive. The current price of 4.6 is below the 20-day moving average (MA) of 11.99, below the 50-day MA of 7.27, and above the 200-day MA of 4.26, indicating a bullish trend. The MACD of 2.11 indicates Positive momentum. The RSI at 76.25 is Negative, neither overbought nor oversold. The STOCH value of 54.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2436.

LX Technology Group Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3336	55 Neutral	HK$1.61B	-2.97	-11.23%	―	-11.28%	-122.85%
2436	48 Neutral	HK$4.95B	-424.24	-1.60%	―	32.83%	90.24%
1079	43 Neutral	HK$428.01M	-23.26	-23.45%	―	29.21%	-137.50%
8159	42 Neutral	HK$63.36M	-1.47	-58.39%	―	2.76%	-141.34%
3638	40 Underperform	HK$454.31M	-12.99	-32.47%	―	-52.55%	-262.35%

LX Technology Group Limited Corporate Events

LX Technology Grants HK$18.2 Million in Share Awards Under Employee Incentive Plan

LX Technology Group Limited has granted a total of 1,331,100 share awards under its Beauty Bear Employee Incentive Plan’s restricted share award scheme to 78 participants, including two directors and 76 employees, representing about 0.38% of its issued share capital. The awards, which carry a nominal purchase price of HK$0.01 per share and a market value of approximately HK$18.18 million based on the grant-date closing price, will vest in full on the first anniversary of the award date subject to annual performance appraisals that determine vesting levels and are subject to a clawback mechanism, underscoring the company’s strategy to align management and employee incentives with corporate performance and retention objectives.

The most recent analyst rating on (HK:2436) stock is a Sell with a HK$13.50 price target. To see the full list of analyst forecasts on LX Technology Group Limited stock, see the HK:2436 Stock Forecast page.

LX Technology Reshapes Board with Director Resignation and HR Chief’s Promotion

LX Technology Group Limited has announced board changes effective 31 December 2025, with non-executive director Li Jing resigning from the board and from a subsidiary directorship to focus on personal commitments, and confirming there is no disagreement with the board or other matters requiring shareholder attention. The company has simultaneously elevated Chen Shuang, currently head of the human resources centre and a long-serving HR and training specialist with experience at several major Chinese corporates, to the role of executive director under a three-year service agreement, a move that underscores the group’s emphasis on human resources management and suggests a continued strategic focus on talent development and internal leadership as it refines its governance structure.

The most recent analyst rating on (HK:2436) stock is a Hold with a HK$4.00 price target. To see the full list of analyst forecasts on LX Technology Group Limited stock, see the HK:2436 Stock Forecast page.

LX Technology Group Announces Board and Committee Composition

LX Technology Group Limited has announced the current composition of its board of directors, listing four executive directors and three independent non-executive directors, underscoring a governance framework that separates management from oversight. The company has also detailed the structure and membership of its three key board committees—audit, remuneration and nomination—specifying which directors serve as chairpersons and members, thereby clarifying lines of responsibility and reinforcing transparency in its corporate governance arrangements for investors and other stakeholders.

The most recent analyst rating on (HK:2436) stock is a Hold with a HK$4.00 price target. To see the full list of analyst forecasts on LX Technology Group Limited stock, see the HK:2436 Stock Forecast page.