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Arrail Group Ltd. (HK:6639)
:6639
Hong Kong Market
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Arrail Group Ltd. (6639) AI Stock Analysis

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HK:6639

Arrail Group Ltd.

(6639)

Rating:54Neutral
Price Target:
HK$2.50
▲(13.12% Upside)
The overall stock score of 54 reflects a mixed financial performance with strengths in cash flow management but challenges in revenue growth and operational efficiency. The technical analysis suggests caution due to mixed signals, and the high P/E ratio indicates potential overvaluation. The absence of earnings call and corporate events data limits further insights.

Arrail Group Ltd. (6639) vs. iShares MSCI Hong Kong ETF (EWH)

Arrail Group Ltd. Business Overview & Revenue Model

Company DescriptionArrail Group Limited operates dental hospitals and clinics in China. It operates through Arrail Dental and Rytime Dental brand names. The company's dental services comprise general dentistry; orthodontics; and implantology. As of March 21, 2022, it operated 51 clinics under the Arrail Dental brand and 54 clinics under the Rytime Dental brand; and seven hospitals under the Rytime Dental brand.. The company was founded in 1999 and is based in Beijing, China.
How the Company Makes MoneyArrail Group generates revenue primarily through its dental and medical service offerings. The company's revenue model is based on the fees charged for various treatments and consultations provided at its clinics. Key revenue streams include payments for dental procedures, cosmetic enhancements, routine check-ups, and specialized medical services. Additionally, Arrail Group may benefit from partnerships with health insurance providers, which can facilitate patient access to its services and create a steady flow of revenue from insured patients. The company's focus on expanding its clinic network and enhancing service offerings also contributes to its earnings growth.

Arrail Group Ltd. Financial Statement Overview

Summary
Arrail Group Ltd. exhibits promising growth with improving profitability and strong cash flow generation. While financial stability is evident through a strong equity ratio, moderate leverage requires careful management. The company is on a positive trajectory but must continue enhancing profitability and managing debt to sustain growth.
Income Statement
72
Positive
Arrail Group Ltd. has shown strong revenue growth of 18.47% in the most recent year, signaling positive momentum. The gross profit margin improved to 22.49%, reflecting better cost management. However, the net profit margin is still low at 0.98%, indicating limited profitability. The turnaround in EBIT and EBITDA margins to 1.49% and 18.46%, respectively, from negative figures in prior years demonstrates improving operational efficiency.
Balance Sheet
65
Positive
The company has a healthy equity position with an equity ratio of 53.95%, denoting financial stability. However, the debt-to-equity ratio of 0.60 suggests moderate leverage which could pose risks if not managed carefully. The return on equity is modest at 0.98%, reflecting the need for enhanced profitability to generate better shareholder returns.
Cash Flow
78
Positive
Operating cash flow grew significantly, supporting a strong free cash flow growth rate of 686.08%. The operating cash flow to net income ratio of 16.12 demonstrates good cash generation relative to earnings. A solid free cash flow to net income ratio of 10.74 further underscores the company's capability to generate cash.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.75B1.69B1.75B1.47B1.62B1.52B
Gross Profit364.84M342.09M392.68M247.08M336.56M364.42M
EBITDA93.34M312.65M322.35M87.85M42.10M207.44M
Net Income20.83M21.99M17.16M-219.91M-701.03M-599.42M
Balance Sheet
Total Assets3.13B3.16B3.25B3.06B2.99B2.35B
Cash, Cash Equivalents and Short-Term Investments997.94M1.09B1.10B937.53M1.26B727.31M
Total Debt1.05B1.03B1.05B955.68M890.67M1.03B
Total Liabilities1.39B1.38B1.42B1.37B1.38B4.81B
Stockholders Equity1.67B1.71B1.76B1.61B1.56B-2.50B
Cash Flow
Free Cash Flow172.32M172.69M184.21M23.50M108.63M213.50M
Operating Cash Flow217.17M231.14M276.65M131.66M224.28M242.87M
Investing Cash Flow74.11M-153.52M-176.00M-342.44M-203.94M61.75M
Financing Cash Flow-274.06M-206.84M-106.96M-280.35M380.86M217.51M

Arrail Group Ltd. Technical Analysis

Technical Analysis Sentiment
Negative
Last Price2.21
Price Trends
50DMA
2.35
Negative
100DMA
2.23
Negative
200DMA
2.40
Negative
Market Momentum
MACD
-0.07
Positive
RSI
44.59
Neutral
STOCH
53.35
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:6639, the sentiment is Negative. The current price of 2.21 is below the 20-day moving average (MA) of 2.29, below the 50-day MA of 2.35, and below the 200-day MA of 2.40, indicating a bearish trend. The MACD of -0.07 indicates Positive momentum. The RSI at 44.59 is Neutral, neither overbought nor oversold. The STOCH value of 53.35 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:6639.

Arrail Group Ltd. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
HK$8.52B29.0331.23%1.43%28.53%22.34%
69
Neutral
HK$959.32M12.037.39%2.77%0.20%-36.95%
68
Neutral
HK$1.93B10.167.31%9.16%-3.19%-20.30%
60
Neutral
HK$7.52B28.12-9.67%2.17%-8.56%-403.12%
54
Neutral
HK$1.25B47.941.27%-4.30%13.83%
54
Neutral
HK$2.45B33.92-6.41%1.03%2.05%-285.88%
51
Neutral
$7.95B-0.40-42.50%2.21%22.29%-1.85%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:6639
Arrail Group Ltd.
2.21
-0.89
-28.71%
HK:1846
EuroEyes International Eye Clinic Limited
3.00
-1.47
-32.89%
HK:1951
Jinxin Fertility Group Ltd.
2.74
0.52
23.42%
HK:2219
Chaoju Eye Care Holdings Ltd.
2.73
0.08
3.02%
HK:2373
Beauty Farm Medical & Health Industry, Inc.
36.24
20.40
128.79%
HK:3309
C-MER Eye Care Holdings Limited
1.95
0.08
4.28%

Arrail Group Ltd. Corporate Events

Arrail Group Ltd. Announces 2025 AGM with Key Resolutions
Jul 25, 2025

Arrail Group Ltd. has announced its 2025 Annual General Meeting to be held on September 26, 2025, in Beijing. Key agenda items include the adoption of the company’s audited financial statements, re-election of executive directors Mr. Zou Qifang and Mr. Zhang Jincai, re-appointment of PricewaterhouseCoopers as auditors, and authorizing the board to manage director and auditor remunerations. The meeting will also address resolutions regarding the issuance of additional shares, which could impact the company’s capital structure and shareholder value.

Arrail Group Waives Default Interest Amid Positive Loan Negotiations
Jul 24, 2025

Arrail Group Limited, a company incorporated in the British Virgin Islands and continued in the Cayman Islands, announced a supplemental update regarding its loan agreement. The company has waived a default interest amounting to US$53,041 due to positive negotiations for a loan extension and additional collateral provided by the borrower. The waiver is considered fair and reasonable, aiming to maintain a strong relationship with the borrower and minimize financial losses.

Arrail Group Limited Establishes Nomination Committee to Strengthen Governance
Jun 27, 2025

Arrail Group Limited, a company incorporated in the British Virgin Islands and continued in the Cayman Islands, has announced the terms of reference for its Nomination Committee. The committee will be comprised of a majority of independent non-executive directors and will be responsible for reviewing the board’s structure, identifying qualified individuals for board positions, and making recommendations on director appointments and succession planning. This move is expected to enhance the company’s governance practices and ensure a diverse and skilled board to support its corporate strategy.

Arrail Group Announces Loan Agreement Amendment and Additional Share Pledge
Jun 27, 2025

Arrail Group Limited, a company incorporated in the British Virgin Islands and continued in the Cayman Islands, has announced a connected transaction involving an amendment to a loan agreement and the pledge of additional shares by its controlling shareholder. The principal amount of the loan has been reduced from US$11 million to US$7.5 million, and the loan term extended by another year. To secure the loan, additional shares have been pledged, representing approximately 9.13% of the company’s total issued share capital. This transaction is subject to reporting and announcement requirements under the Listing Rules but is exempt from circular and independent shareholders’ approval.

Arrail Group Ltd. Reports Increased Profits Despite Revenue Decline
Jun 27, 2025

Arrail Group Ltd. announced its annual results for the year ended March 31, 2025, reporting a 3.3% decrease in revenue to RMB1,688.4 million, attributed to the economic environment affecting treatment prices. Despite the revenue decline, the company achieved a 39.4% increase in operating profit and a 20.5% rise in annual profit, driven by cost reduction and efficiency measures. The company also expanded its operations by opening a new dental hospital in Wuxi, increasing its total dental chairs to 1,566, and reported a slight increase in patient visits.

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: Aug 20, 2025