Perennial Energy Holdings Ltd. (2798) AI Stock Analysis

• Market Cap: €1.31B
• Dividend Yield: 6.1%
• Average Volume (3M): 870.83K
• Price to Earnings (P/E): 6.5
• Beta (1Y): 0.48
• Revenue Growth: -26.28%
• EPS Growth: -69.55%
• Country: HK
• Employees: 3,699
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Coal
• EPS (TTM): <0.01
• Shares Outstanding: 1,600,000,000
• 10 Day Avg. Volume: 548,500
• 30 Day Avg. Volume: 870,833
• PEG Ratio: -0.26
• Price to Book (P/B): 0.45
• Price to Sales (P/S): 0.83
• P/FCF Ratio: -1.79
• 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: €1.00
• Price Target Upside: 21.86% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 70 Outperform
• Price Target: HK$1.00 ▲(21.95% Upside)

Perennial Energy Holdings Ltd. has a solid valuation with a low P/E ratio and high dividend yield, making it attractive for value and income investors. However, the company faces challenges in cash flow management and profitability, which are significant concerns. Technical indicators suggest a moderate upward trend, but caution is advised due to potential overbought conditions. Overall, the stock presents a balanced risk-reward profile with notable strengths in valuation but weaknesses in financial performance.

Perennial Energy Holdings Ltd. Business Overview & Revenue Model

Company Description

Perennial Energy Holdings Limited, an investment holding company, operates as a coal mining company in the People's Republic of China. The company principally explores for and mines various coals, such as clean, middling, sludge, and raw and coking coal; and operates a coal refinery. It also produces and sells coalbed methane gas. It operates three underground coal mines comprising Hongguo Coal Mine with a licensed area of 3.0225 sq. km; Baogushan Coal Mine covering a licensed area of 2.4736 sq. km; and Xiejiahegou Coal Mine with a licensed area of 1.0135 sq. km located in Panzhou City, Guizhou Province. The company was incorporated in 2017 and is headquartered in Liupanshui, China. Perennial Energy Holdings Limited is a subsidiary of Spring Snow Management Limited.

How the Company Makes Money

Perennial Energy Holdings Ltd. generates revenue through several key streams. Primarily, the company earns income from the sale of electricity produced by its renewable energy projects, including solar and wind farms. Additionally, it may engage in power purchase agreements (PPAs) with utilities or large corporations, securing long-term contracts that provide stable revenue. The company also invests in energy efficiency projects, offering consulting and implementation services to businesses looking to reduce their energy consumption and costs. Strategic partnerships with other energy firms, governmental bodies, and technology providers enhance its operational capabilities and market reach, contributing to its overall earnings. Furthermore, grants and incentives from governments for renewable energy projects can also bolster its financial performance.

Perennial Energy Holdings Ltd. Financial Statement Overview

Summary

Perennial Energy Holdings Ltd. shows a mixed financial performance. The income statement reveals strong gross margins but declining profitability and revenue growth. The balance sheet is robust with a strong equity position and manageable debt levels, providing financial stability. However, the cash flow statement indicates significant challenges, with negative operating cash flow and deteriorating free cash flow, raising concerns about liquidity and cash management.

Income Statement

Perennial Energy Holdings Ltd. shows a mixed performance in its income statement. The gross profit margin for 2024 is strong at 51.9%, indicating effective cost management. However, the net profit margin has decreased to 25.8% from 29.4% in 2023, reflecting a decline in profitability. Revenue growth has been negative over the past year, with a decrease of 0.6%, indicating potential challenges in sales expansion. The EBIT margin stands at 33.8%, and the EBITDA margin is 42.7%, both showing a decline from the previous year, suggesting pressure on operational efficiency.

Balance Sheet

The balance sheet of Perennial Energy Holdings Ltd. is robust with a high equity ratio of 64.9%, reflecting a strong capital structure. The debt-to-equity ratio is moderate at 0.38, indicating manageable leverage. Return on equity is healthy at 13.9%, although it has decreased from 18.1% in the previous year, suggesting a slight decline in shareholder returns. Overall, the company maintains a stable financial position with a solid equity base.

Cash Flow

The cash flow statement reveals significant challenges for Perennial Energy Holdings Ltd. The operating cash flow has turned negative in 2024, indicating cash flow issues from core operations. Free cash flow has also worsened, showing a negative growth rate. The operating cash flow to net income ratio is negative, highlighting inefficiencies in converting income to cash. These factors suggest potential liquidity concerns and the need for improved cash management.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.71B	1.72B	1.78B	1.54B	1.40B
Gross Profit	885.13M	944.29M	1.12B	918.48M	716.00M
EBITDA	728.64M	803.84M	1.07B	845.22M	624.30M
Net Income	440.23M	504.19M	743.96M	301.77M	345.48M
Balance Sheet
Total Assets	4.86B	4.33B	4.08B	3.24B	2.68B
Cash, Cash Equivalents and Short-Term Investments	205.46M	129.96M	202.06M	180.85M	139.60M
Total Debt	1.19B	915.15M	788.55M	525.84M	378.69M
Total Liabilities	1.70B	1.54B	1.62B	1.47B	1.16B
Stockholders Equity	3.16B	2.79B	2.46B	1.77B	1.52B
Cash Flow
Free Cash Flow	-789.30M	-515.67M	-293.73M	98.07M	249.94M
Operating Cash Flow	-423.94M	213.38M	180.74M	553.43M	492.27M
Investing Cash Flow	-590.49M	-866.80M	-734.56M	-662.75M	-756.70M
Financing Cash Flow	1.10B	545.07M	575.02M	150.57M	160.72M

Perennial Energy Holdings Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.82
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2798, the sentiment is Positive. The current price of 0.82 is above the 20-day moving average (MA) of 0.79, above the 50-day MA of 0.81, and above the 200-day MA of 0.79, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 58.16 is Neutral, neither overbought nor oversold. The STOCH value of 78.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2798.

Perennial Energy Holdings Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1733	72 Outperform	2.22B	8.06	10.64%	22.67%	-23.72%	-86.69%
2798	70 Outperform	€1.31B	6.52	6.31%	6.10%	-26.28%	-69.55%
1303	68 Neutral	536.30M	8.12	15.06%	―	39.98%	-73.77%
0866	58 Neutral	7.56B	20.69	25.46%	1.34%	-20.71%	209.68%
6885	46 Neutral	503.30M	-1.48	-11.09%	―	-26.97%	-76.57%
1393	39 Underperform	271.71M	-0.48	-58.13%	―	15.80%	51.68%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%

Perennial Energy Holdings Ltd. Corporate Events

Perennial Energy Reports Significant Financial Decline in H1 2025

Perennial Energy Holdings Ltd. announced a significant decline in its financial performance for the first half of 2025, with revenue dropping by 31.9% year-on-year to approximately RMB591.5 million. The company’s gross profit also saw a steep decrease of 65.1%, and its profit and total comprehensive income plummeted by 98.9% compared to the previous year. The board has decided not to declare an interim dividend, reflecting the challenging financial period the company is experiencing.

The most recent analyst rating on (HK:2798) stock is a Hold with a HK$1.00 price target. To see the full list of analyst forecasts on Perennial Energy Holdings Ltd. stock, see the HK:2798 Stock Forecast page.

Perennial Energy Holdings Announces Board Composition and Roles

Perennial Energy Holdings Limited has announced the composition of its board of directors and the roles they hold. The board includes both executive and independent non-executive directors, with specific members assigned to the audit, remuneration, and nomination committees. This announcement provides clarity on the leadership structure of the company, which may influence its strategic direction and governance practices.

The most recent analyst rating on (HK:2798) stock is a Hold with a HK$1.00 price target. To see the full list of analyst forecasts on Perennial Energy Holdings Ltd. stock, see the HK:2798 Stock Forecast page.

Perennial Energy Holdings to Review Interim Results and Dividend

Perennial Energy Holdings Limited has announced that its board of directors will convene on August 25, 2025, to approve the unaudited interim results for the first half of the year ending June 30, 2025. The meeting will also consider the payment of an interim dividend, which could impact the company’s financial strategy and shareholder returns.

Perennial Energy Issues Profit Warning Amid Market and Operational Challenges

Perennial Energy Holdings Limited has issued a profit warning, indicating a significant decline in net profit for the first half of 2025, with expected figures ranging between RMB6 million to RMB0.1 million, marking a decrease of up to 99.9% compared to the same period in 2024. This downturn is attributed to falling clean coal market prices, operational delays due to geological challenges, and rising compliance-related costs, impacting the company’s gross profit margins and operational efficiency.

Perennial Energy Holdings Enhances Governance with Audit Committee

Perennial Energy Holdings Limited, a company incorporated in the Cayman Islands and listed on the Hong Kong Stock Exchange, has established an Audit Committee to comply with the listing rules. The committee, formed in 2018, is composed of non-executive directors, with a majority being independent, to oversee the company’s financial reporting and auditing processes. The announcement outlines the committee’s structure, membership criteria, and meeting protocols, which aim to enhance transparency and governance within the company.

Perennial Energy Holdings Limited Forms Nomination Committee to Strengthen Governance

Perennial Energy Holdings Limited has established a Nomination Committee to ensure a formal and transparent process for appointing new directors and planning for board succession. This move aligns with the company’s commitment to adhere to the listing rules of the Hong Kong Stock Exchange, aiming to enhance governance and operational efficiency.

Perennial Energy Holdings Establishes Remuneration Committee for Enhanced Governance

Perennial Energy Holdings Limited has established a Remuneration Committee to enhance transparency and objectivity in setting remuneration for its directors and senior management. The committee, which complies with the Hong Kong Stock Exchange’s listing rules, consists of at least three members, primarily independent non-executive directors, and is tasked with reviewing and recommending remuneration policies, thereby potentially impacting the company’s governance and stakeholder trust.