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Zuoli Kechuang Micro-finance Co. Ltd. Class H (HK:6866)
:6866
Hong Kong Market

Zuoli Kechuang Micro-finance Co. Ltd. Class H (6866) AI Stock Analysis

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HK

Zuoli Kechuang Micro-finance Co. Ltd. Class H

(6866)

Rating:68Neutral
Price Target:
Zuoli Kechuang Micro-finance Co. Ltd. has a solid financial foundation due to its strong balance sheet and attractive valuation metrics. However, declining revenues, profitability concerns, and cash flow volatility pose significant risks. Technical indicators show mixed signals, suggesting cautious optimism in the short term.

Zuoli Kechuang Micro-finance Co. Ltd. Class H (6866) vs. iShares MSCI Hong Kong ETF (EWH)

Zuoli Kechuang Micro-finance Co. Ltd. Class H Business Overview & Revenue Model

Company DescriptionZuoli Kechuang Micro-finance Company Limited operates as a microfinance company in the People's Republic of China. The company offers unsecured, guaranteed, collateralized, and pledged loans; enterprise loans, including agriculture loans and technology enterprises credit loans, as well as loans for other small and medium-sized enterprises and microenterprises; individual business, start-up, and other loans; and Internet micro-loans. The company was formerly known as Deqing Zuoli Kechuang Micro-finance Company Limited and changed its name to Zuoli Kechuang Micro-Finance Company Limited in April 2014. Zuoli Kechuang Micro-finance Company Limited was founded in 2011 and is headquartered in Huzhou, the People's Republic of China.
How the Company Makes MoneyZuoli Kechuang Micro-finance Co. Ltd. makes money by earning interest on the loans it provides to its clients, which include small and medium-sized enterprises and individual entrepreneurs. The company charges interest on both secured and unsecured loans, with interest rates determined by the risk profile of the borrower and prevailing market conditions. Additionally, the company may earn revenue from loan-related fees, such as origination fees, processing fees, and late payment penalties. Zuoli Kechuang Micro-finance may also benefit from partnerships with banks or financial institutions for funding and risk-sharing purposes, which can enhance its lending capacity and reduce operational risks.

Zuoli Kechuang Micro-finance Co. Ltd. Class H Financial Statement Overview

Summary
Zuoli Kechuang Micro-finance Co. Ltd. shows a robust balance sheet with low leverage and high equity ratio, indicative of financial stability. However, the declining revenue and profitability margins signal potential challenges in maintaining growth and profitability. Cash flow volatility further underscores the need for a cautious approach in financial management.
Income Statement
65
Positive
The company's revenue has been declining over the past years, with a revenue growth rate of -36.55% from 2022 to 2023 and -36.53% from 2023 to 2024. The gross profit margin remains strong at 100%, indicating good cost control. However, the net profit margin decreased from 47.48% in 2023 to 50.44% in 2024. The EBIT margin remains healthy, though it declined from 76.89% in 2022 to 68% in 2024.
Balance Sheet
78
Positive
The company maintains a strong equity position with an equity ratio of 76.93% in 2024, showcasing a solid balance sheet with low leverage. The debt-to-equity ratio improved to 0.23 in 2024 from 0.31 in 2023, indicating reduced financial risk. Return on equity decreased slightly to 3.15% in 2024, reflecting a drop in profitability.
Cash Flow
60
Neutral
Operating cash flow has been volatile, with a significant decline from 2023 to 2024. Free cash flow also decreased by 43.53% from 2023 to 2024. The operating cash flow to net income ratio is strong at 2.58 in 2024, but the free cash flow to net income ratio has dropped to 2.58, indicating potential cash flow challenges.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue123.77M195.08M208.27M251.94M263.65M
Gross Profit123.77M195.08M208.27M251.94M263.65M
EBITDA0.000.000.000.000.00
Net Income62.44M92.65M93.34M116.49M110.24M
Balance Sheet
Total Assets2.58B2.66B2.79B2.65B2.60B
Cash, Cash Equivalents and Short-Term Investments10.52M17.48M16.59M42.68M78.23M
Total Debt463.26M596.46M761.88M649.97M663.06M
Total Liabilities537.41M654.60M761.88M649.97M663.06M
Stockholders Equity1.98B1.94B1.90B1.86B1.75B
Cash Flow
Free Cash Flow160.85M284.92M-5.50M69.12M142.81M
Operating Cash Flow160.85M284.95M-5.46M70.28M148.84M
Investing Cash Flow58.00K96.00K-26.00K118.00K-7.04M
Financing Cash Flow-167.85M-284.04M-19.51M-104.22M-118.83M

Zuoli Kechuang Micro-finance Co. Ltd. Class H Technical Analysis

Technical Analysis Sentiment
Negative
Last Price0.27
Price Trends
50DMA
0.28
Negative
100DMA
0.28
Negative
200DMA
0.28
Negative
Market Momentum
MACD
<0.01
Positive
RSI
32.83
Neutral
STOCH
36.90
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:6866, the sentiment is Negative. The current price of 0.27 is below the 20-day moving average (MA) of 0.28, below the 50-day MA of 0.28, and below the 200-day MA of 0.28, indicating a bearish trend. The MACD of <0.01 indicates Positive momentum. The RSI at 32.83 is Neutral, neither overbought nor oversold. The STOCH value of 36.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:6866.

Zuoli Kechuang Micro-finance Co. Ltd. Class H Peers Comparison

Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
79
Outperform
HK$61.70B6.2914.62%4.88%1.21%2.15%
70
Outperform
HK$70.07B42.2711.20%0.26%35.04%102.30%
68
Neutral
HK$330.40M7.821.97%5.00%-21.32%-63.98%
67
Neutral
$16.89B11.799.73%3.75%11.97%-8.33%
46
Neutral
HK$13.04B-6.64%2.39%-35.35%-14.20%
40
Underperform
$163.62M-155.60%-46.94%-89.98%
40
Underperform
HK$1.06B-95.62%-31.29%57.76%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:6866
Zuoli Kechuang Micro-finance Co. Ltd. Class H
0.28
-0.04
-12.50%
HK:1528
Red Star Macalline Group Corporation Ltd Class H
1.65
0.32
24.06%
HK:1818
Zhaojin Mining Industry Co
19.78
4.84
32.40%
HK:1813
KWG Group Holdings
0.31
>-0.01
-1.59%
HK:3311
China State Construction International Holdings
11.68
1.24
11.85%
HK:2012
Sunshine Oilsands
0.48
-0.09
-16.67%

Zuoli Kechuang Micro-finance Co. Ltd. Class H Corporate Events

Zuoli Kechuang Enhances Governance with New Nomination Committee
Apr 25, 2025

Zuoli Kechuang Micro-finance Co. Ltd. has established a Nomination Committee under its Board of Directors to regulate the appointment of management officers and optimize the board’s composition. This move aims to improve corporate governance by ensuring diversity and balance in the board’s talent and expertise, thereby potentially enhancing the company’s strategic development and operational efficiency.

Zuoli Kechuang Micro-finance Reports Decline in Q1 2025 Profits
Apr 25, 2025

Zuoli Kechuang Micro-finance Co. Ltd. announced its unaudited consolidated results for the first quarter of 2025, showing a decrease in net interest income and profit compared to the same period in 2024. The company’s profit before tax dropped significantly from RMB 53,830,000 to RMB 20,858,000, indicating challenges in maintaining profitability amid rising administrative expenses and lower other net income.

Zuoli Kechuang Micro-finance Announces 2024 AGM with Strategic Financial Resolutions
Apr 24, 2025

Zuoli Kechuang Micro-finance Co. Ltd. has announced its 2024 Annual General Meeting (AGM) scheduled for June 13, 2025, where key resolutions will be discussed and potentially approved. These include the approval of the company’s annual reports, financial statements, profit distribution plan, and external auditor’s fees. Additionally, the company seeks approval for a bank credit line up to RMB300 million and external guarantees up to RMB800 million. A special resolution will address the issuance of debt financing instruments up to RMB1 billion to supplement working capital, reflecting the company’s strategic financial planning and potential growth initiatives.

Zuoli Kechuang Updates Cash Dividend Details for 2024
Apr 24, 2025

Zuoli Kechuang Micro-finance Co. Ltd. has announced an update regarding its cash dividend for the financial year ending December 31, 2024. The final ordinary dividend declared is RMB 0.0127 per share, with key dates including an ex-dividend date of June 27, 2025, and a payment date of August 29, 2025. This announcement reflects the company’s commitment to returning value to its shareholders and maintaining transparency in its financial operations.

Zuoli Kechuang Announces New Share Charge Arrangement
Apr 23, 2025

Zuoli Kechuang Micro-finance Company Limited announced the release of a previous share charge and the establishment of a new share charge involving 322,540,960 domestic shares, representing 27.33% of the company’s total issued share capital. This new share charge, held by substantial shareholder Deqing Puhua Energy Company Limited in favor of Zhegu (Hangzhou) Corporate Management Company Limited, is not intended to secure the company’s debts or obligations, indicating a strategic financial maneuver that may impact stakeholder interests and the company’s market positioning.

Zuoli Kechuang Proposes Amendments to Enhance Governance
Apr 17, 2025

Zuoli Kechuang Micro-finance Co. Ltd. has announced proposed amendments to its Articles of Association in response to changes in the Company Law and other regulatory guidelines in China. These amendments aim to enhance corporate governance and require approval from shareholders at the upcoming annual general meeting, as well as necessary approvals from relevant authorities.

Zuoli Kechuang Schedules Board Meeting to Review Q1 Results
Apr 11, 2025

Zuoli Kechuang Micro-finance Co. Ltd. has announced a board meeting scheduled for April 25, 2025, to review and approve the unaudited consolidated first quarterly results for the period ending March 31, 2025. This meeting is crucial for the company as it will provide insights into its financial performance and strategic direction, potentially impacting its market positioning and stakeholder confidence.

Zuoli Kechuang Micro-finance Updates Dividend Payment Date
Mar 19, 2025

Zuoli Kechuang Micro-finance Co. Ltd. has announced an update to its cash dividend declaration for the financial year ending December 31, 2024. The company declared a final ordinary dividend of RMB 0.0127 per share, with the payment date set for August 29, 2025. This announcement may impact the company’s financial planning and investor relations as it reflects the company’s commitment to returning value to shareholders.

Zuoli Kechuang Announces 2024 Final Dividend
Mar 19, 2025

Zuoli Kechuang Micro-finance Co. Ltd. has announced a final ordinary cash dividend of RMB 0.0127 per share for the financial year ending December 31, 2024. This announcement reflects the company’s financial performance and commitment to returning value to its shareholders, potentially impacting its market positioning and stakeholder relations.

Zuoli Kechuang Micro-finance Reports 2024 Annual Results with Decreased Profit
Mar 18, 2025

Zuoli Kechuang Micro-finance Co. Ltd. announced its audited annual results for the year ending December 31, 2024, showing a decrease in net interest income and profit compared to the previous year. The company’s total assets slightly decreased, while net assets increased, indicating a stronger equity position. The results reflect challenges in maintaining interest income and managing expenses, impacting overall profitability.

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: Apr 20, 2025