Kangda International Environmental Co Ltd (6136) AI Stock Analysis

• Market Cap: HK$1.03B
• Dividend Yield: N/A
• Average Volume (3M): 4.01M
• Price to Earnings (P/E): 5.4
• Beta (1Y): 0.33
• Revenue Growth: 3.04%
• EPS Growth: 6.91%
• Country: HK
• Employees: 2,285
• Sector: Utilities
• Sector Strength: 65
• Industry: Regulated Water
• EPS (TTM): 0.05
• Shares Outstanding: 2,307,008,500
• 10 Day Avg. Volume: 5,214,000
• 30 Day Avg. Volume: 4,006,100
• PEG Ratio: 0.11
• Price to Book (P/B): 0.11
• Price to Sales (P/S): 0.29
• P/FCF Ratio: 1.86
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 60 Neutral
• Price Target: HK$0.50 ▲(13.64% Upside)

The overall stock score of 60 reflects stable financial performance with strong cash flow management and undervaluation based on the P/E ratio. However, high leverage and low net profit margins pose financial risks. Technical indicators suggest mixed momentum, with potential oversold conditions. The absence of earnings call and corporate events data limits further insights.

Positive Factors

Cash Generation

Strong cash generation enhances financial flexibility, enabling investment in growth opportunities and resilience against economic downturns.

Revenue Growth

Consistent revenue growth indicates a stable demand for services and a solid market position, supporting long-term business sustainability.

Gross Profit Margin

A strong gross profit margin suggests effective cost control and pricing power, contributing to long-term profitability and competitive advantage.

Negative Factors

High Leverage

High leverage can increase financial risk and limit flexibility, potentially impacting the company's ability to invest in growth or weather downturns.

Net Profit Margin

A low net profit margin suggests challenges in controlling operating expenses, which could hinder profitability and long-term financial health.

Financing Cash Outflows

Significant financing cash outflows may signal reliance on external funding, which could be risky if market conditions change or interest rates rise.

Kangda International Environmental Co Ltd Business Overview & Revenue Model

Company Description

Kangda International Environmental Co Ltd (6136) is a leading provider of environmental protection services and solutions in China. The company operates primarily in the sectors of water treatment, waste management, and air pollution control. Kangda specializes in the development and implementation of technologies and services aimed at improving environmental quality. Its core offerings include municipal wastewater treatment, industrial wastewater treatment, solid waste disposal, and air quality management systems.

How the Company Makes Money

Kangda International generates revenue through multiple streams, primarily by providing engineering, procurement, and construction (EPC) services for environmental projects. The company earns money from long-term service contracts for the operation and maintenance of wastewater treatment plants and waste disposal facilities. Additionally, Kangda benefits from government contracts and subsidies aimed at enhancing environmental protection. Strategic partnerships with local governments and private enterprises also play a crucial role in securing projects and expanding its market reach. The company may also generate income from consulting services related to environmental compliance and sustainability practices.

Kangda International Environmental Co Ltd Financial Statement Overview

Summary

Kangda International Environmental Co Ltd demonstrates stable revenue growth and effective cash flow management, with strong gross and operating margins. However, the high leverage and relatively low net profit margins highlight potential areas of financial risk and opportunities for operational improvements. The company is positioned for steady growth but needs to address its leverage to enhance financial stability.

Income Statement

The company has shown a slight increase in revenue over the past year with a revenue growth rate of 2.03%. Gross profit margin remains strong at 48.16%, reflecting efficient cost management. However, the net profit margin is relatively low at 7.43%, indicating room for improvement in controlling operating expenses. EBIT and EBITDA margins are healthy at 35.56% and 37.28%, respectively, suggesting strong core operations.

Balance Sheet

The company has a high debt-to-equity ratio of 1.62, indicating significant leverage, which could pose a risk if not managed carefully. Return on equity is moderate at 2.83%, showing limited profitability from shareholder investments. The equity ratio is 30.99%, pointing to a balanced asset financing structure but with considerable reliance on debt.

Cash Flow

Free cash flow grew by 51.44%, showing strong cash generation capabilities. The operating cash flow to net income ratio of 2.40 indicates robust cash conversion from earnings. Free cash flow to net income is also strong at 2.09, suggesting effective cash management. However, the high financing cash outflows could indicate potential refinancing needs.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.31B	2.26B	2.22B	2.90B	2.92B	3.33B
Gross Profit	1.13B	1.09B	1.08B	1.27B	1.34B	1.33B
EBITDA	811.24M	843.10M	907.38M	1.03B	1.09B	1.14B
Net Income	162.84M	168.00M	124.75M	235.68M	412.75M	470.49M
Balance Sheet
Total Assets	19.06B	19.15B	19.23B	18.97B	18.28B	17.65B
Cash, Cash Equivalents and Short-Term Investments	640.46M	521.16M	595.36M	559.94M	318.33M	430.26M
Total Debt	9.58B	9.61B	9.92B	9.52B	9.47B	9.27B
Total Liabilities	12.92B	13.13B	13.38B	13.23B	12.87B	12.53B
Stockholders Equity	6.05B	5.93B	5.71B	5.60B	5.27B	4.92B
Cash Flow
Free Cash Flow	567.69M	351.04M	231.81M	367.95M	319.11M	242.48M
Operating Cash Flow	636.41M	403.14M	292.92M	368.41M	320.17M	243.73M
Investing Cash Flow	-101.28M	151.77M	12.80M	101.98M	-122.08M	337.17M
Financing Cash Flow	-598.88M	-626.02M	-257.11M	-563.03M	-337.88M	-380.76M

Kangda International Environmental Co Ltd Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.44
• 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:6136, the sentiment is Positive. The current price of 0.44 is above the 20-day moving average (MA) of 0.43, below the 50-day MA of 0.44, and above the 200-day MA of 0.37, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 55.41 is Neutral, neither overbought nor oversold. The STOCH value of 61.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:6136.

Kangda International Environmental Co Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2281	75 Outperform	HK$627.59M	3.14	6.36%	6.03%	4.85%	-4.80%
3768	69 Neutral	HK$771.83M	2.89	4.69%	―	-9.45%	-17.46%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
6136	60 Neutral	HK$1.03B	5.43	2.82%	―	3.04%	6.91%
1542	43 Neutral	HK$57.00M	-2.66	-9.98%	―	-8.34%	-13.24%
1129	43 Neutral	HK$186.50M	-0.29	-31.95%	―	-43.38%	-25.63%
6839	40 Underperform	HK$184.95M	-0.09	-514.90%	―	-5.97%	-50.72%

Kangda International Environmental Co Ltd Corporate Events

Kangda International Engages in Strategic Finance Lease Agreements

Kangda International Environmental Co Ltd has entered into finance lease agreements with a lessor to transfer and lease back assets worth RMB50,000,000. This transaction, along with previous similar agreements, is classified as a discloseable transaction under Hong Kong’s Listing Rules, indicating a strategic move to manage assets and finances effectively.

Kangda International Updates on Share Option Exercise Amid Takeover Offer

Kangda International Environmental Co Ltd announced an update regarding the exercise of share options, resulting in the allotment of 75,933,500 shares. This move is part of the company’s ongoing share option scheme, which impacts its capital structure and may influence its market positioning. The announcement follows a mandatory unconditional cash offer by the Joint Offerors to acquire all issued shares and cancel outstanding share options, indicating potential shifts in ownership and strategic direction.