Zhengye International Holdings Co., Ltd. (3363) AI Stock Analysis

• Market Cap: HK$175.00M
• Dividend Yield: 6.29%
• Average Volume (3M): 12.07K
• Price to Earnings (P/E): 6.8
• Beta (1Y): 0.14
• Revenue Growth: 0.80%
• EPS Growth: 81.27%
• Country: HK
• Employees: 2,705
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Paper, Lumber & Forest Products
• EPS (TTM): <0.01
• Shares Outstanding: 500,000,000
• 10 Day Avg. Volume: 7,000
• 30 Day Avg. Volume: 12,066
• PEG Ratio: -0.02
• Price to Book (P/B): 0.16
• Price to Sales (P/S): 0.07
• P/FCF Ratio: -0.28
• 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$0.35 ▼(-3.61% Downside)

Zhengye International Holdings' overall stock score is primarily impacted by its weak financial performance and bearish technical indicators. While the stock appears undervalued with a high dividend yield, significant operational inefficiencies and liquidity challenges pose risks. The lack of positive market momentum further weighs on the stock's attractiveness.

Positive Factors

Revenue Diversification

Diversified revenue streams across different sectors reduce dependency on a single market, enhancing resilience against sector-specific downturns.

Strategic Partnerships

Strong partnerships expand market reach and sales capabilities, supporting long-term growth and competitive positioning.

Stable Balance Sheet

A balanced approach to leveraging indicates financial stability, providing a solid foundation for future investments and growth.

Negative Factors

Operational Inefficiencies

Operational inefficiencies can hinder profitability and limit the company's ability to reinvest in growth, impacting long-term competitiveness.

Weak Cash Flow

Weak cash flow limits financial flexibility, potentially affecting the company's ability to fund operations and invest in growth opportunities.

Low Profitability

Low profitability indicates challenges in cost management and pricing power, which can affect long-term financial health and shareholder returns.

Zhengye International Holdings Co., Ltd. Business Overview & Revenue Model

Company Description

Zhengye International Holdings Co., Ltd. (3363) is a diversified investment holding company based in Hong Kong, primarily engaged in the manufacturing and sale of various products including textiles, electronics, and construction materials. The company operates through several subsidiaries that focus on different sectors, providing a wide range of goods and services to both domestic and international markets. Zhengye is committed to innovation and quality, aiming to enhance its market presence and customer satisfaction across its core product lines.

How the Company Makes Money

Zhengye International generates revenue through multiple streams, including the sale of manufactured goods in its core sectors. Key revenue streams include the production and distribution of textiles, where the company supplies both wholesale and retail markets. The electronics segment contributes to earnings through the sale of consumer electronics and components, while construction materials provide an additional revenue source through contracts with construction firms and developers. The company has established significant partnerships with distributors and retailers, which enhance its market reach and sales capabilities. Additionally, Zhengye may engage in strategic investments and joint ventures that provide potential for revenue growth and diversification.

Zhengye International Holdings Co., Ltd. Financial Statement Overview

Summary

Zhengye International Holdings Co., Ltd. faces challenges in maintaining revenue growth and operational profitability. Despite a stable balance sheet with moderate leverage, the volatility in cash flows underscores potential issues in liquidity management. The company must address operational inefficiencies and enhance cash flow generation to improve its financial stability.

Income Statement

The company experienced a decline in revenue from 2021 to 2024, with a revenue drop of approximately 31.6% since 2021. Gross profit margins have decreased over time, from a high of 19% in 2019 to 12% in 2024. Net profit margin in 2024 showed improvement with a positive 1.5%, up from a negative margin in 2023. However, EBIT margins have been negative since 2023, indicating struggles in operational efficiency.

Balance Sheet

The debt-to-equity ratio is relatively stable, around 0.95 in 2024, indicating moderate leverage. The equity ratio is reasonably healthy at 39%, providing a cushion against liabilities. However, the consistent reduction in stockholders' equity from 2019 to 2024 suggests potential challenges in maintaining asset growth relative to liabilities.

Cash Flow

The cash flow statement reveals volatility, with operating cash flow dropping to zero in 2024 from positive figures in previous years. Free cash flow has been inconsistent, with a significant decline in 2024. The lack of positive free cash flow growth and operating cash flow to net income ratio raises concerns about the company's cash generation capabilities.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.41B	2.44B	2.39B	3.01B	3.56B	2.49B
Gross Profit	233.70M	293.88M	270.00M	341.73M	676.97M	390.87M
EBITDA	51.68M	92.34M	156.94M	263.18M	416.39M	225.89M
Net Income	23.69M	36.39M	-17.55M	47.17M	160.84M	54.77M
Balance Sheet
Total Assets	3.00B	2.88B	2.99B	2.98B	3.03B	2.68B
Cash, Cash Equivalents and Short-Term Investments	198.23M	187.38M	253.91M	279.84M	229.58M	185.37M
Total Debt	1.21B	1.06B	1.05B	1.09B	1.24B	1.16B
Total Liabilities	1.59B	1.47B	1.62B	1.58B	1.65B	1.49B
Stockholders Equity	1.12B	1.12B	1.09B	1.11B	1.11B	965.68M
Cash Flow
Free Cash Flow	-349.56M	-648.55M	-249.50M	-36.21M	-431.27M	-366.57M
Operating Cash Flow	-116.02M	-417.90M	-120.77M	148.76M	-194.98M	-202.17M
Investing Cash Flow	-280.72M	-267.94M	-150.04M	-233.72M	-197.43M	-139.04M
Financing Cash Flow	370.71M	619.31M	244.89M	135.22M	436.63M	295.49M

Zhengye International Holdings Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.36
• 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:3363, the sentiment is Negative. The current price of 0.36 is below the 20-day moving average (MA) of 0.36, below the 50-day MA of 0.37, and below the 200-day MA of 0.39, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 16.86 is Positive, neither overbought nor oversold. The STOCH value of 6.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:3363.

Zhengye International Holdings Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2314	69 Neutral	HK$12.20B	8.91	4.88%	3.91%	1.95%	-9.10%
2002	64 Neutral	HK$1.54B	8.24	3.56%	3.45%	-5.66%	-56.96%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
2689	59 Neutral	HK$26.79B	13.93	3.81%	―	6.14%	134.18%
0731	50 Neutral	HK$301.31M	17.46	11.34%	―	-9.44%	―
3363	48 Neutral	HK$175.00M	6.82	2.13%	6.29%	0.80%	81.27%
1812	47 Neutral	HK$4.76B	-0.16	―	―	-76.55%	-966.54%

Zhengye International Holdings Co., Ltd. Corporate Events

Zhengye International Announces Property Disposal in Connected Transaction

Zhengye International Holdings Co., Ltd. announced a discloseable and connected transaction involving the disposal of a property by its non-wholly owned subsidiary. The property, located in Zhongshan City, China, is being sold to Zhongshan Xiongdi Supply Chain Co., Ltd. for approximately RMB8,807,400. This transaction is considered a discloseable transaction under the Hong Kong Stock Exchange’s Listing Rules due to its size and the involvement of connected persons, including company executives. The sale is expected to be completed with payment installments by the end of December 2025.