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Nine Dragons Paper Holdings (HK:2689)
:2689

Nine Dragons Paper Holdings (2689) AI Stock Analysis

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HK

Nine Dragons Paper Holdings

(OTC:2689)

Rating:56Neutral
Price Target:
HK$3.00
▼(-12.79%Downside)
Nine Dragons Paper Holdings' overall stock score is influenced primarily by its mixed financial performance, which poses challenges to growth and stability. The technical analysis offers some short-term optimism, but the valuation suggests moderate appeal. Absence of dividend yield and the potential financial risk due to leverage and cash flow volatility are key concerns.

Nine Dragons Paper Holdings (2689) vs. iShares MSCI Hong Kong ETF (EWH)

Nine Dragons Paper Holdings Business Overview & Revenue Model

Company DescriptionNine Dragons Paper (Holdings) Limited, together with its subsidiaries, manufactures and sells packaging paper, recycled printing and writing paper, and specialty paper and pulp products in the People's Republic of China. The company offers linerboard products, including kraft, test, white top, and coated linerboards; corrugating medium containerboard products; corrugated cardboard products; carton box products; corrugated sheet products; and coated duplex boards. It also provides recycled printing and writing paper, such as uncoated wood-free paper and office paper; capacitor tissue paper; low and high voltage, ultra-high-voltage transformer coil winding, and heat-resistant insulating paper; and recycled and kraft pulp products. It also distributes its products in Vietnam, Malaysia, and the United States. The company was founded in 1995 and is headquartered in Dongguan, the People's Republic of China. Nine Dragons Paper (Holdings) Limited is a subsidiary of Best Result Holdings Limited.
How the Company Makes MoneyNine Dragons Paper Holdings generates revenue primarily through the manufacturing and sale of various paper products. The company's key revenue streams include the production and sale of containerboard, which is used extensively in packaging, and printing and writing paper. They have a vertically integrated business model that incorporates the collection and processing of recycled paper, reducing costs and enhancing sustainability. Additionally, Nine Dragons Paper benefits from strategic partnerships and joint ventures that expand its market reach and distribution capabilities. Significant factors contributing to its earnings include economies of scale in manufacturing, a strong presence in the Chinese market, and an increasing demand for eco-friendly packaging solutions.

Nine Dragons Paper Holdings Financial Statement Overview

Summary
Nine Dragons Paper Holdings has shown a mixed financial performance. While there is some improvement in revenue and profit margins in 2024, the performance remains inconsistent with previous years. The balance sheet shows expansion but with increased leverage risk, and the cash flow is volatile with negative free cash flow, indicating liquidity challenges.
Income Statement
45
Neutral
Nine Dragons Paper Holdings has shown mixed performance in its income statement. While there is a modest increase in total revenue from 2023 to 2024, the revenue growth has been inconsistent over the years, with a decline observed from 2020 to 2023. Gross profit margin improved significantly from 2023 to 2024, indicating better cost management, but net profit margin remains low, reflecting challenges in translating revenue growth into bottom-line profitability. The EBIT and EBITDA margins have improved in 2024 from the previous year, yet they have not reached the higher levels seen in earlier years.
Balance Sheet
55
Neutral
The balance sheet shows a robust increase in total assets over the years, signaling expansion. However, the debt-to-equity ratio has risen, indicating higher leverage risk, which could be a concern if not managed properly. The equity ratio has remained relatively stable, suggesting a consistent capital structure. Return on equity has improved in 2024 as net income turned positive, but it remains lower compared to earlier years, pointing to room for improvement in generating returns for shareholders.
Cash Flow
40
Negative
Cash flow statements reveal a volatile free cash flow, with significant negative free cash flow in recent years, indicating high capital expenditures and potential liquidity concerns. The operating cash flow to net income ratio turned negative in 2024, highlighting inefficiencies in converting profit to cash. While there have been significant cash inflows from financing activities, these are primarily driven by debt, potentially increasing financial risk.
BreakdownTTMJun 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income Statement
Total Revenue62.35B59.50B56.74B64.54B61.57B51.34B
Gross Profit6.20B5.71B1.53B6.99B11.69B9.03B
EBITDA6.56B6.18B2.17B6.68B11.31B8.54B
Net Income1.15B772.35M-2.38B3.28B7.10B4.17B
Balance Sheet
Total Assets143.30B138.37B120.65B107.08B92.17B79.32B
Cash, Cash Equivalents and Short-Term Investments11.86B10.68B10.44B9.78B10.15B5.66B
Total Debt70.14B69.03B56.76B44.20B34.14B26.31B
Total Liabilities94.12B89.89B75.51B59.58B45.78B38.52B
Stockholders Equity48.68B48.01B44.65B47.05B45.93B40.37B
Cash Flow
Free Cash Flow5.83B-13.61B-10.77B-9.59B-3.54B4.15B
Operating Cash Flow5.98B-794.20M6.92B3.03B2.52B8.95B
Investing Cash Flow-12.87B-12.66B-17.42B-12.32B-5.64B-4.51B
Financing Cash Flow11.27B13.67B11.14B8.92B7.63B-7.22B

Nine Dragons Paper Holdings Technical Analysis

Technical Analysis Sentiment
Positive
Last Price3.44
Price Trends
50DMA
3.09
Positive
100DMA
3.18
Positive
200DMA
3.23
Positive
Market Momentum
MACD
0.08
Negative
RSI
72.82
Negative
STOCH
90.57
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2689, the sentiment is Positive. The current price of 3.44 is above the 20-day moving average (MA) of 3.22, above the 50-day MA of 3.09, and above the 200-day MA of 3.23, indicating a bullish trend. The MACD of 0.08 indicates Negative momentum. The RSI at 72.82 is Negative, neither overbought nor oversold. The STOCH value of 90.57 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2689.

Nine Dragons Paper Holdings Peers Comparison

Overall Rating
UnderperformOutperform
Sector (43)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
56
Neutral
$16.14B16.042.05%9.33%
43
Neutral
AU$1.41B-6.14-40.62%3.98%-4.78%-42.91%
$1.27B7.144.75%4.12%
€451.66M
64
Neutral
HK$1.84B6.075.95%2.89%-5.61%-34.60%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:2689
Nine Dragons Paper Holdings
3.44
0.25
7.84%
LMPMF
Lee & Man Paper Manufacturing
0.28
0.00
0.00%
DE:SCD1
Shandong Chenming Paper Holdings Co., Ltd. Class H
0.06
-0.14
-70.00%
HK:2002
China Sunshine Paper Holdings Co. Ltd.
1.73
-0.38
-18.01%

Nine Dragons Paper Holdings Corporate Events

Nine Dragons Paper Clarifies 2016 Share Option Scheme in 2024 Annual Report
Jun 27, 2025

Nine Dragons Paper Holdings Limited has released a supplemental announcement regarding its 2024 Annual Report, providing additional details on its 2016 Share Option Scheme. The company has not granted any options under this scheme for the year ended June 30, 2024, with 466,622,081 shares available for grant. This represents approximately 9.94% of the company’s total ordinary shares. The announcement clarifies the terms of the option scheme, including the exercise period and acceptance process, without affecting other information in the annual report.

The most recent analyst rating on (HK:2689) stock is a Hold with a HK$3.80 price target. To see the full list of analyst forecasts on Nine Dragons Paper Holdings stock, see the HK:2689 Stock Forecast page.

Nine Dragons Paper Announces Executive Committee Changes
Apr 30, 2025

Nine Dragons Paper Holdings Limited announced a change in the composition of its Executive Committee, effective April 30, 2025. Mr. Lau Chun Shun will step down due to internal job relocation, and Mr. Ken Liu, an executive director, will join the committee. This adjustment in the board’s structure may influence the company’s strategic direction and operational efficiency.

Nine Dragons Paper Announces Executive Director Resignation
Apr 8, 2025

Nine Dragons Paper Holdings Limited announced the resignation of Mr. Zhang Yuanfu as an executive director, effective April 8, 2025, due to age-related reasons. Mr. Zhang will continue to serve as the Chief Financial Officer, and his departure is amicable with no disagreements with the board. The board expressed gratitude for Mr. Zhang’s contributions during his tenure.

Nine Dragons Paper Holdings Announces Board Composition and Governance Structure
Apr 8, 2025

Nine Dragons Paper Holdings has announced the composition of its board of directors and their roles within the company. This announcement provides clarity on the governance structure, which includes a mix of executive and independent non-executive directors. The board is supported by four committees, each with defined roles, ensuring robust corporate governance. This structure is likely to strengthen the company’s strategic decision-making and operational oversight, potentially enhancing its market position and stakeholder confidence.

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: Jun 24, 2025